Reports show finance-related challenges remain the largest barriers to renewable energy development
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November 14, 2012
An analysis of two reports by the National Renewable Energy Laboratory’s (NREL) Renewable Energy Finance Tracking Initiative (REFTI) shows that despite healthy expected returns, finance-related challenges remain the largest barriers to renewable energy development. The reports on solar and geothermal technologies show greater than 10 per cent expected returns for both developers and tax equity investors. Yet roughly half of both geothermal and solar respondents (350 in total) reported financial issues (project economics, PPAs, creditworthiness, and raising capital) as the largest barriers to development. In light of this, only 11 to 13 per cent of respondents reported abandoning their projects. Geothermal projects reported the highest returns among all technologies with both developer and tax equity returns estimated to exceed 15 per cent. NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.