“Project finance”, an innovative approach to the development of renewable energy projects.

Project finance or Project finance consists in gathering, combining and structuring the various contributions of funds necessary for large-scale investments, private, public or mixed, while ensuring their financial viability. Project financing differs from other financing methods (in particular “corporate” financing) by the fact that the contributions of funds will mainly be remunerated by the cash flows generated by the project itself.

This financing, which is often based on the creation of a project company (ad-hoc company or SPV: Special Purpose Vehicle), limits the risk for outside investors and for the parent company.

The SPV is linked to multiple contracts, each of which has an important role to play and its own risks. Therefore, during funding, an in-depth audit phase (Due Diligence) checks each of them to ensure that we have a true picture of the different stakeholders and their respective commitments.

Project Finance’s approach is often used for the financing of large renewable energy projects for the production of electricity by the private sector within the framework of Public Private Partnerships (PPP).