Triodos Bank and FEH develop new financing concept
Triodos Bank’s main focus is to advance the transformation of energy systems. In cooperation with Frankfurt Energy Holding GmbH (FEH), Europe’s leading sustainability bank is now focusing on the further development of the decentralised energy system transformation. Both partners jointly develop and finance photovoltaic portfolios consisting of roof-mounted systems.
What is special about this is that FEH and Triodos Bank have agreed on project and financing standards for locations that are not yet known at the time the loan is granted by signing a credit line. This closes a gap in the market, as such a financing concept for medium-sized PV systems (up to 750 kWp) is not yet known in the German banking sector. Up to now, roof-mounted PV systems have mostly been financed as individual projects, which means that project developers and banks have to pay a high level of individual review.
In order to ensure fast and efficient implementation of individual systems, FEH has set up a special purpose vehicle (SPV). The contracts for individual rooftop PV systems are highly standardised, so that after a brief review – in which only deviations from the agreed standards are discussed – loans can be paid out quickly. Traditionally, the pre-construction financing phase for project developers involves high equity costs if they do not want to wait for financing approval. The cooperation between FEH and Triodos Bank now provides for debt financing, in which the protracted part of the bank’s collateral is only provided subsequently.
“In addition to the planning security which is important to us and which the cooperation gives us, we can significantly increase the speed of project sales with a greatly simplified disbursement process and thus low capital expenditure. Furthermore, the high degree of standardization is an essential way of mastering the current conditions in the PV environment. With the jointly developed product, we have found a very good solution to meet the challenges in the current market and to simplify the projects/PV rooftop systems, which are always the same in terms of handling,” explains Robin Lehmberg, who is responsible for photovoltaic project financing at FEH.
Dominic Hereth, Head of the Energy & Climate Team at Triodos Bank, explains: “Our cooperation has the common goal of taking the energy turnaround a step further despite the current investment backlog in major wind and solar projects. In order to increase our impact, we are aiming to implement similar concepts with portfolio financing of EUR 15 million or more with additional partners after completion of the pilot phase with FEH”.
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