Public Commentary: The information below sets out FG Capital’s perspective on renewable-energy carbon-credit transactions. It is provided for informational purposes only and should not be construed as investment advice or a solicitation.
RE Carbon Projects – Renewable Energy Project Finance (Wind, Solar, Hydro)
Utility-scale wind, solar-photovoltaic, and run-of-river hydro facilities displace fossil-fuel generation, creating verifiable emission reductions alongside electricity sales. Our advisory team combines project-finance expertise with carbon-market insight, enabling sponsors to secure competitive funding, optimise revenue stacks, and place high-integrity credits with reputable offtakers.
Technology Scope
• On-shore Wind:
Turbine arrays from 50 MW to 500 MW with stable capacity factors.
• Solar PV:
Fixed-tilt or single-axis tracker plants, including bifacial modules.
• Run-of-River Hydro:
Low-impact installations utilising natural river flow without large reservoirs.
Advisory Framework
1 | Feasibility & Baseline Analysis
• Grid-emission factor validation and additionality assessment.
• Selection of appropriate methodology (e.g., Verra ACM0002 or Gold Standard ACM0002).
2 | Capital Structuring
• Limited-recourse senior debt, mezzanine tranches, and equity co-investment.
• Integration of advance credit purchase agreements to underpin debt-service cover.
3 | Implementation Oversight
• EPC contract review, grid-connection milestones, and environmental-social safeguards.
• Compliance with IFC Performance Standards where applicable.
4 | MRV & Certification
• Continuous energy-metering coupled with conservative grid-factor updates.
• Third-party verification and registry issuance scheduling.
5 | Credit Monetisation
• Structured forwards with investment-grade corporates.
• Ongoing trading support following issuance to optimise pricing.
Indicative Financial Parameters
| Metric | Wind | Solar PV | Run-of-River Hydro |
|---|---|---|---|
| CapEx (USD / kW) | 1,150 – 1,400 | 700 – 950 | 1,300 – 1,600 |
| Emission Reductions (tCO 2 e / MWh) | 0.45 – 0.80 (grid dependent) | ||
| Forward Credit Price (Year 0, USD / t) | 9 – 13 | ||
| Target Equity IRR (post-tax) | 14 % – 17 % | 12 % – 15 % | 13 % – 16 % |
Representative Capital Stack
| Tier | Security Package | Cost of Capital | Typical Providers |
|---|---|---|---|
| Senior Project Debt | Pledge over project assets and revenue accounts | SOFR + 275 – 350 bps | Multilateral banks, infrastructure debt funds |
| Subordinated Loan | Second-ranking charge; cash-sweep covenant | SOFR + 500 – 650 bps | Private credit funds |
| Advance Credit Purchase | Offtake agreement; delivery-failure remedies | Fixed price USD 10 / t | Corporate sustainability desks |
| Sponsor Equity | Residual cash flow | Target IRR 14 % – 17 % | Independent power producers |
Stakeholder Benefits
- Project Sponsors: Optimised capital structure and accelerated time-to-financial close.
- Local Communities: Job creation, grid stability, and reduced air-quality impacts.
- Credit Purchasers: Long-term supply of verifiable emission-reduction units from essential infrastructure.
- Investors: Exposure to contracted cash flows complemented by market-linked carbon upside.
Engagement
Stakeholders considering a renewable-energy carbon project are invited to engage with our advisory team. We would be pleased to discuss feasibility assessments, financing solutions, and long-term market strategies.
This document has been prepared solely for informational purposes. It does not constitute investment advice, nor does it form part of any offer to purchase or subscribe for securities, financial instruments, or services. Independent professional guidance should be obtained before acting on any information contained herein.
