Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Low Carbon raises £230 million for new solar projects

© Shutterstock / ChrispicturesLloyds Bank.

NatWest, Lloyds Bank and AIB have provided a £230 senior debt facility to Low Carbon for new solar projects. An accordion facility gives a  £200 million extension for a total of 1 GW of new solar projects across the UK and the Netherlands.

Up to £430 million loaned to Low Carbon for large-scale solar PV projects in the UK and the Netherlands amounting to 1 GW of solar capacity.

The decision by three household name banks shows the confidence placed in Low Carbon and the solar market in the UK and the Netherlands.

Financially it demonstrates a shift from the specific project financing model.

Low Carbon has established an innovative finance facility with three leading commercial banks, NatWest, Lloyds Bank and AIB. The facility will enable the construction of large-scale renewable energy projects in the UK and the Netherlands.

The resulting capacity of at least 1 GW will provide clean, affordable power to more than 360,000 homes and avoid 308,000 tonnes of CO2e according to the company.

Large loan facility widens boundaries of project finance

Financing of renewable energy from banks usually takes the form of project finance where each project’s risks and future cash flows are assessed. The lenders to a project would have either no recourse or only limited recourse to the company that develops or “sponsors” the project. Lenders will not forgo recourse to a project’s Sponsor unless there is a projected revenue stream from the project that can be secured for purposes of ensuring repayment of the loans.

That such a large loan facility has been placed in the trust of Low Carbon for a cluster of projects, 17 mentioned, is testament to market expectations of growth in the solar market. At the same time, it says something about the reliance being placed on the management team, as the growth in appetite makes addressing execution risk a high priority.

Low Carbon Founder and Chief Executive, Roy Bedlow, said: “We are delighted that three of the UK and Ireland’s leading banks have demonstrated a major endorsement of our business and its ambitions for expansion. The next decade is crucial to slowing the pace of climate change, and it is imperative that we rapidly deploy renewable energy at scale.”

Low Carbon has set a goal to create 20GW of new renewable energy capacity by 2030.

Solar market in the UK and Netherlands

In the UK after a few years of withdrawn support for solar, the Contracts for Difference scheme re-allowed solar PV projects and onshore wind to participate, announced in 2019. That catalysed millions of pounds of funding for renewable projects bid in the fourth round auction held in December 2021

Earlier this year the government announced that from 2023, CfD auctions will be held annually, which was welcomed heartily by the solar industry. Solar Energy UK’s chief executive Chris Hewitt said: “The UK needs to treble its solar energy output by 2030 to keep pace with net-zero targets. Investors are lining up to do just that, and this announcement will give them greater confidence.”

Lloyds Banking Group’s sustainability strategy targets the provision of £15 billion for sustainable finance by 2024.

James Taylor, Head of Infrastructure & Project Finance at Lloyds Bank, said of the investment: “Funding the development of renewable power generation is crucial to achieving UK’s Net Zero targets. In particular, low risk technologies such as solar PV will play a key role by accelerating the transition away from fossil fuels in a cost-effective manner.”

The Netherlands, according to figures released in 2022 by SolarPower Europe, has the most solar panels per capita in Europe, largely a result of government support.

More from SG Voice

Latest Posts