How to Get Financing for a Wind Energy Project – More Information Will be Available on the Universal Business Structured Solution’s Web Site on December 10th, 2012

“Wind power is developing rapidly at both the European and global level. Between 1992 and 2008, the global installed capacity of wind power increased from 2.5 GW to more than 120 GW, an average annual growth rate of more than 25%. Due to ongoing improvements in turbine efficiency, wind power is increasing in economic competitiveness against conventional power production.”
Source: The European Wind Energy Association.

A very substantial share of the heat and electricity produced all around the world is generated by a coal, gas or nuclear powered plants.
By using Wind Energy Systems the following will be avoided, comparing to more conventional methods:

1. The emissions that in turn contribute to poor air quality and global warming
2. The Depletion of fossil fuel reserves
3. Price volatility created by global energy commodity market fluctuations
4. The health and safety issues related to mining, processing, consumption and disposal of fuels and wastes

Wind Electric Power offers attractive alternatives to conventional electricity generation. Among today’s renewable energy choices, Wind Electric Power is one of the market’s most attractive options. Wind Electric Power Solar is:
1. Clean – No carbon footprint or harmful emissions.
2. Cost Effective – Current tax incentives make wind electricity cost-competitive with conventional electricity.
3. Dependable – wind turbines may last 20 to 30 years, or longer

Uneven heating of the atmosphere is the main cause of wind, also the spin of the earth and irregularities of the earth’s surface, add a small amount of winds. Humans have many uses for a wind flow, such as: pumping water, sailing boats, but also generating electricity.

Generating electricity from the wind energy (or wind power) refers to the process by which wind turbines convert the movement or kinetic energy of the wind into electricity.

Wind energy has really become integrated into our culture, worldwide in fact, over the last couple of decades. We developed wind mills that harnessed energy, started popping them up a little bit everywhere, then the technology developed even more, methods of storing energy, and then there are offshore wind farms that developed, and today you can buy your own wind mill and power your house yourself!

Wind energy today is the part of the social consciousness and our culture’s growing green energy trend, so the demand for a renewable energy financing has been increasing dramatically.

The first and the most important thing for any Wind Energy Project is the wind survey done by a reputable third party firm that would provide a proof of constant and high amounts of wind for the future project.

Although the wind’s energy is free, special equipment is needed to convert it to electricity. The up-front costs of this equipment can be a daunting barrier to any startup or even income producing Wind Project. That is why the majority of the Wind Projects look for a financing.

Funding any Wind Energy Project would require the following information to be provided:
a. Resumes of all principals
b. Budgeted forecast for at least 5 years
c. A professionally written executive summary & business plan
d. Finalized Power Purchase Agreements (PPA)

It is crucial that the principals are able to clearly convey all the essential information: generation of revenue, risk assessment and its mitigation.

The best way to start a conversation is to send an executive summary to the Universal Business Structured Solution, that would be a short outline of the whole project.

Predevelopment funding is not available, but a bridge financing can be provided if project owns sufficient collateral and has an exit strategy-take out financing for a bridge in place. In some cases our experts can arrange both: the bridge and the permanent financing.

In order to provide the best possible financial structure due diligence and underwriting process is necessary, and the risk and return factors have to be carefully assessed.

A very wide range of financial products and up to 100% financing are available for a qualified Renewable Energy Project. Universal Business Structured Solution Energy Finance Team is dedicated to bring the best possible financial structure to the table by capitalizing on the industry specific expertise and strategic alliance with a very broad array of industry leaders and funding sources. Our financial programs include Debt, Mezzanine, Equity, Joint Ventures options.

Debt Financing
Debt Financing is based on a collateral and a future cash flow of the Power Purchase Agreements (PPA). A loan usually is secured by the company’s assets, power purchase contracts and a mortgage on the real property . Depending on the risk profile some cases call for liens on all personal property, personal guarantee from the principals, as well as an assignment of agreements, permits and operating revenues to a lender.

Mezzanine loan
Mezzanine loan comes to the picture when senior’s debt resources become exhausted. It is basically debt capital that takes a junior position to a senior debt, has higher interest rate and sometimes gives lenders rights to convert to an ownership or equity interest in the company.
Equity Investment and Joint Venture/Strategic Partnerships
Equity Investment is much riskier to a capital provider than debt, and therefore will require higher Internal Rate of Return (IRR). Financial models with all the supporting documentation are required in order for sophisticated investor to evaluate viability of equity investment in the proposed Renewable Energy Financing Project.
Bridge Financing
Bridge Financing is a short term financial solution that provides necessary liquidity while waiting for an anticipated and reasonably expected exit strategy (inflow of cash). Bridge Loan is more expensive than other more conventional loans, but can be funded in a relatively short period of time.