Finance: Geothermal Asset Finance Increases 14% in 2016

Global Trends in Renewable Energy Investment 2017 (Frankfurt School-UNEP Collaborating Centre)

The only sector to see an increase in asset finance in 2016 was geothermal

Global Trends in Renewable Energy Investment 2017, published on April 6th by UN Environment, the Frankfurt School-UNEP Collaborating Centre, and Bloomberg New Energy Finance, finds that all investments in renewables totaled $241.6 billion (excluding large hydro). These investments added 138.5 gigawatts to global power capacity in 2016, up 8 per cent from the 127.5 gigawatts added the year before.

The only sector to see an increase in asset finance in 2016 was geothermal, with a 14% rise to $2.5 billion. The level of investment in new geothermal capacity worldwide has been relatively consistent over the last eight years, averaging $2.2 billion, so last year’s total is unlikely to mark any new trend.

The largest geothermal plants reaching financial close in 2016 were the ENDE Laguna Colorada project in Bolivia, at 100 MW and $612 million, and the KenGen Olkaria V undertaking in Kenya, at 140 MW and $403 million. Japan was instrumental in the financing of both these projects, its government agreeing a credit line for the Bolivian installation and the Japan International Cooperation Agency signing a loan deal with KenGen for the latter. There were also $100 million-plus projects financed in Turkey, Iceland and Honduras.

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