April 2019

From subsidy-free renewables to the rise of corporate power purchase agreements (PPAs), Deutsche Bank Corporate Trust’s Dean Kennedy and Thalia Delahayes discuss the latest trends in clean energy investment

Infrastructure Investor magazine recently interviewed Deutsche Bank’s Dean Kennedy and Thalia Delahayes on why clean energy infrastructure is so popular. During the interview, they shared the following insights:

  • Positive interest in battery storage: There has been a lot of interest in battery storage in the US, driven by legislation and a number of incentive programmes. In terms of technology, lithium-ion has been the main focus and the decrease in battery costs is pushing this new asset class forward. While in Europe, particularly in the UK, there are a number of specialist battery storage funds that are cropping up now, as well as dedicated electric vehicle and other sub-sector funds
  • Offshore wind blows strong: European countries have installed a total of offshore wind capacity of 18,500MW compared to 30MW installed in the US. The first US offshore wind deal was done in 2016, in Block Island, and currently a further six states have committed to deploy more than 15GW of offshore wind along the Atlantic coast. Wind remains key in Europe as well. The UK clearly represented the lion’s share of the market last year, with well over £10bn ($13bn; €11bn) of debt raised for greenfield or refinancings
  • More corporate involvement of power purchase agreements (PPAs): Deutsche Bank has been involved in two greenfield onshore wind financings in the Nordics in the last year. Both of those were backed by corporate PPAs. Further corporate involvement in PPA is expected in Ireland, which is targeting 40% of renewables electricity generation by 2020, ramping up by another 15% by 2030
  • Subsidy-free renewables on the rise: Subsidy-free opportunities are expected to continue while the costs of building renewable projects, such as solar and wind, are expected to come down

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