Finance firm seeks to pour up to EUR 200m in off-grid renewables

An international finance company is looking to invest EUR 100 million-200 million (USD 113-226m) in off-grid solar- and wind-diesel hybrid and storage projects, with a focus on mines and large industrial customers.

Consultancy THEnergy has been mandated to build a pipeline of such renewable energy projects. The unnamed finance company will establish an off-grid fund to make the planned investment over three years. When debt capital is added to the calculation, the finance company expects a total investment of EUR 200 million–400 million.

“We are looking at developed projects, but would also like to address intensive energy users that are not connected to the grid, source their energy from diesel power plants and are interested in decreasing their electricity bill,” said Thomas Hillig, founder of THEnergy.

When working with large industrial customers, the plan is to offer green energy under power purchase agreements (PPAs), with the fund acting as an independent power producer (IPP). This will eliminate the high initial investment needed for renewable energy projects, which, until now, was a significant barrier for diesel displacement projects with wind and solar.

THEnergy said the minimum investment would be EUR 3 million per project, with a sweet spot of EUR 10 million-15 million per project. The finance company expects a double-digit return, depending on the country, currency and off-takers.

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