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“I believe this year and next year [the market will] Switch to the CfDs once again,” stated Pawel Olkowicz, 3rd. Image: PV Tech.
Funding structures such as agreements for distinction (CfDs) might be an important enhance to the work of the nascent power purchase arrangement (PPA) market in the Eastern European solar sector.
This was an essential takeaway from the current panel conversation held at Solar Media’s Large Scale Solar Central Eastern Europe in Warsaw this afternoon, with Pawel Olkowicz, vice president of job financing at Sonnedix, recommending a mix of PPAs and CfD plans might provide “incomes and returns on an appropriate level.”
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Going over top priorities for an independent power manufacturer (IPP) such as Sonnedix, he accentuated “the mix of [delivering] profits that are as steady as possible, by the mix of CfDs, PPAs and a roi that we need to safeguard in front of our financiers, and bankability of the job.”
“We all understand that there’s an oversupply of production and generation today,” he included. “The technique that we, as an IPP, take is that if we can not take bankable PPAs, we require to go to some other steady capital source, such as a CfD. “I believe this year and next year [the market will] switch to the CfDs once again … based upon the estimations that we’ve currently made, it’s possible to blend PPAs with CfDs and get earnings and returns on an appropriate level.”
Dealing with offtakers
The danger cravings of offtakers, and their top priorities with regard to energy sources and cost, might have an essential effect on the long-lasting health of the PPA market.
“Especially in Eastern Europe, the offtakers are exceptionally price-sensitive,” stated Severin Vartigov, primary industrial officer and nation supervisor at Enery. “The decision-making is 80% price-driven and just 20% ESG-driven, and associated to ecological targets.”
“We have designers, IPPs, investors, and no offtakers,” he included, mentioning that the panel that looked for to go over the function of offtakers in this plan included no agents from offtakers. “This is the marketplace we require to run in!”
“As a banks we are on the financiers’ side,” stated Małgorzata Lipowska, director of the structured financing department, BNP Paribas Bank Polska, who likewise required higher awareness of the, sometimes, clashing top priorities of those associated with the PPA area.