Project financing and refinancing renewables projects supported by the Renewables Obligation (RO) scheme: key Facility Agreement provisions specific to this type of project
Produced in partnership with Caroline Saul of Osborne Clarke

The following Energy practice note produced in partnership with Caroline Saul of Osborne Clarke provides comprehensive and up to date legal information covering:

  • Project financing and refinancing renewables projects supported by the Renewables Obligation (RO) scheme: key Facility Agreement provisions specific to this type of project
  • Introduction
  • Project financing and renewable projects
  • Facility agreement provisions in renewable projects
  • Conditions precedent
  • Representations and covenants
  • Replacement of PPAs and Counterparties
  • Events of Default
  • Portfolio Financings
  • Security—generally
  • More...

Project financing and refinancing renewables projects supported by the Renewables Obligation (RO) scheme: key Facility Agreement provisions specific to this type of project

Introduction

This Practice Note will look at the issues to take into consideration when financing renewable energy projects in the UK, particularly those that receive Renewables Obligation Certificates (ROCs), how those financed using bank or institutional debt are done on a non- or limited recourse basis and the importance of a guaranteed income stream for those projects. It builds on:

  1. the overview of project financing structures found in: Financing a project—overview

  2. the introduction to the documents used in project financings found in Practice Note: Project finance—key finance documents

but does not look in detail at the process and consequences of achieving ROC accreditation for a project, which can be found in Practice Notes: Renewables Obligation (RO)—accreditation of renewable electricity generators and Renewables Obligation (RO)—key features.

Project financing and renewable projects

Project financing (which can also be referred to as non-recourse, limited recourse or structured financing, depending on the negotiated continuing input of the sponsor) of a renewable energy project in the UK is the financing of the construction and/or operation and maintenance of such project, based on the forecast income (receivables) for that project for the life of the proposed loan.

For ROC projects, the forecast receivables comprise:

  1. amounts received under the power purchase agreement (PPA) for

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