The interest of investors in the development of new renewable energy projects is extremely high, including from investment and pension funds. All investors, however, seek to ensure that their investments will be made in a framework of “stability and predictability”. So but banks must be careful not to give loans to those opportunistic and inexperienced investors, but only to those who are strategic and know the field.

“What the banks must not do, because there is liquidity and appetite, is to endanger this stability, because it will lead to the loss of confidence and then of interest in this subsector. So, what we must not do is grant overly relaxed financing structures or financing to investors with an opportunistic approach or without sufficient experience”, said Oana Mogoi, Sector Head Utilities & Natural Resources, ING Bank, at the conference “More renewables for Romania”, organized by Energynomics.

ING did not propose to finance a specific number of MW installed in power plants producing energy from renewable sources in Romania, but is rather interested in financing those projects that are in line with its own financing policy and investors who share the same market understanding.

 

“The appetite is much greater and not only from the area of ​​traditional investors. What we set out to do, as there is this potential, is to finance successful projects of traditional, experienced investors who can bring a very good contribution to Romania”, added Mogoi.

One of the things needed in this context is the integrated approach to new investments, because if these projects develop too quickly, the energy system could suffer.

According to Mogoi, a very good way to limit production capacities is overtaxation “and we are now seeing it happening in the case of existing projects”.

In the first wave of renewables, from 2008-2012, banks were warned that they would finance the renewables system too aggressively, but such a statement is untrue, as the loans granted to renewable energy projects at that time were of medium size.

But in retrospect, the banks that financed those projects could have taken an integrated approach to lending. In other words, they could have assessed more closely a number of aspects related to the pace of investments in the network, the availability of backup capacities or the evolution of green energy quota in total  energy consumption and the evolution of the overall economy.

Banks are currently said to be under-financing green energy projects, but this is not true.

Compared to the first wave of investments in renewables, there is a general increased interest in this area, and the explanation lies in the fact that now there is pressure on other sectors as well not on energy only to align with the changes inherent in the energy transition, a situation that was not so pressing ten years ago. Moreover, sustainability “becomes an important element in accessing bank financing”.

“There is an appetite, but we must all understand that we live in a different market context, with other risks”, continued Mogoi.

For example, obligations related to sustainability are becoming a certainty, and EU states already have legislation that refers to this aspect, which forces listed companies to disclose their sustainability targets and achieved milestones, starting in 2024 based on 2023 figures. That means companies should have already in place sustainability frameworks with concrete investments and funding sources.

The conference “More renewables for Romania” was organized by Energynomics with the support of our partners among which ABB, ACE Industrial Software, BCR, Consolight, Eaton Electric, Elektra Renewable Support, EnergoPower, European Energy, Finder, Geminox, Huawei, ING Bank, LAPP Romania, Marsh & McLennan Companies, Phoenix Contact, Photomate, Prime Batteries Technology, REI Grup, Renomia-Gallagher, Valmont, Volt, Wiren România, Wise Finance Solutions.