Renewable energy projects are capital intensive. Land, engineering, equipment, grid connections and early-stage development work all require investment long before the first kilowatt hour is sold. For developers, utilities and corporates, the question is rarely whether solar, wind or hydro are technically viable. The real challenge is how to fund projects at a scale and cost that supports long-term returns.
Renewable energy financing brings together debt, equity and policy support to make these projects bankable. Structures are built around contracted revenues, such as power purchase agreements, feed-in arrangements or merchant price forecasts, with risk allocated across investors, lenders, sponsors and sometimes the public sector.
This guide explains the main funding models for renewable energy, how they work in practice and which parties they suit. It also sets out how Financely Group helps sponsors and corporates structure and secure tailored capital for solar, wind and hydro projects through banks, private credit funds and long-term investors.
Renewable energy financing refers to the capital structures used to fund projects that generate power or heat from clean sources such as solar, wind and hydro. It covers:
Funding can include:
The aim is to build a capital stack where each source of funding is aligned with project risk, duration and expected returns.
Debt financing for renewable energy usually takes the form of term loans or project finance facilities. Banks and lenders advance capital that is repaid from project cash flows over time. Key characteristics include:
For larger projects, export credit agencies or development finance institutions may provide longer-term or partially guaranteed debt for eligible technologies and jurisdictions.
Equity is provided by project sponsors, infrastructure funds, utilities or strategic investors. Equity holders absorb construction and operating risk and receive returns through dividends and asset value growth. Features include:
In some cases, corporates invest equity to support decarbonisation goals or secure long-term power for their own operations.
Project finance is a structure where debt is raised mainly on the basis of project cash flows, not the balance sheet of the sponsor. Renewable assets are prime candidates for this approach where they have:
Lenders rely on detailed financial models, technical reports and legal documentation. Once operational, the project company services its debt from revenues generated by selling power or certificates.
Green bonds are fixed income instruments where proceeds are earmarked for eligible environmental projects. For renewable energy sponsors, these bonds can:
Issuers must meet reporting and use-of-proceeds standards set out in green bond frameworks and market guidelines.
Many jurisdictions offer grants, tax incentives, tariff support or credit guarantees to accelerate renewable deployment. These mechanisms:
Understanding how these schemes interact with project structure, tax and local regulations is a key part of the financing strategy.
While every transaction is bespoke, most solar, wind and hydro projects use variations of the same core building blocks. The mix of debt, equity and policy support depends on jurisdiction, resource profile and sponsor objectives.
Renewable assets require significant upfront investment, while revenues arrive gradually over many years. Structured financing allows sponsors to commit to large projects without tying up their entire balance sheet, and gives investors exposure to long-dated cash flows that are often contracted.
Debt, equity and policy tools spread risk across multiple parties. Senior lenders focus on base case cash flows and security, while equity investors price construction and merchant exposure. Public incentives, guarantees or contracts can further reduce specific risks tied to tariffs, resource or offtake.
Once built and contracted, solar, wind and hydro plants often generate predictable, inflation-linked cash flows over long periods. For infrastructure funds, pension investors and utilities, these projects can provide steady returns that match long-dated obligations.
Many jurisdictions link financing terms to environmental performance and policy goals. Projects may benefit from tax credits, priority grid access, guarantees or premium tariffs that enhance bankability. Aligning financing with these frameworks helps sponsors secure better terms and reduces policy risk where rules are stable.
Structured capital flows into renewable projects support emissions reduction, cleaner air and more resilient energy systems. For corporates and governments, financing decisions in this area are not only financial choices but also part of wider climate and sustainability commitments.
A wide range of stakeholders rely on renewable energy financing to move projects from planning to operation, including:
Renewable energy projects are technical, legal and financial undertakings at the same time. Sponsors must align engineering, permits, offtake contracts and funding in a single coherent structure. Finding capital that understands these interdependencies is critical.
Financely Group works with developers, corporates and investors that need arranged capital for solar, wind and hydro projects. Through regulated partners, we:
The objective is to reach a financing structure that is bankable, repeatable across portfolios and aligned with each client’s strategy on risk and return.
Whether you are building a single solar plant, a portfolio of wind farms or a run-of-river hydro asset, the financing strategy will shape timelines, risk allocation and long-term returns. Early engagement with suitable lenders and investors can resolve key questions around structure and bankability before significant costs are committed.
If you are planning or advancing a renewable project and need debt, equity or hybrid solutions, a focused funding process can turn preliminary models into financed assets with clear commercial frameworks.
Share your solar, wind or hydro project details, capital requirement and current documentation with our team to explore tailored renewable energy financing options through our global lender and investor network.
Request Renewable Energy Financing TodayDisclaimer: This page is for general information only and does not constitute legal, tax, accounting or investment advice. Financely Group acts as advisor and arranger through regulated partners and is not a bank or direct lender. Any renewable energy financing, project finance, bond issue, equity investment or other capital solution is subject to underwriting, KYC, AML, sanctions screening, ESG review, legal due diligence, documentation, perfected security and approvals by relevant stakeholders. No public offer or solicitation is made on this page.
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Disclaimer: Financely provides financing based on due diligence and feasibility. Approval is not guaranteed, and past performance does not predict future outcomes. All terms are subject to review. Financely primarily assists with structuring and distribution. Qualified parties carry out the project if the client approves the proposal.
Financely advises growth-focused businesses on accessing capital by introducing their opportunities to professional investors. Financely is not a securities broker or dealer. Where appropriate, engagements are coordinated with regulated broker-dealers, investment banks, legal counsel, and other specialists.
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All mandates start with an RFQ. We review submissions, issue a brief Go/No-Go memo, and where bankable, release a Term Sheet that leads to funding. We arrange capital across Senior Secured, Unitranche, Second Lien/Mezzanine, Preferred Equity, and Gap Solutions. We do not process deals by email or chat.
Letters of Credit, Standby LCs, Confirmations, Receivables Finance, and Inventory Lines with control.
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Financely Inc. (“Financely”) provides corporate-finance advice and is wholly owned by Aurora Bay Trust, a trust formed under Bahamian law, together with its authorized affiliates. Depending on deal structure, jurisdiction, and local rules, engagements may be carried out through Financely Group LLC, a non-deposit-taking, non-banking financial company; Ashford Capital Advisory LLC; or another related entity.
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