Triodos Bank predicts 2011 solar financing crunch

The head of business banking at Europe's largest sustainable bank has warned that many solar projects will fail to move forward this year as developers rush to secure financial backing before the government cuts the incentives available through its feed-in tariff scheme.

Bevis Watts, head of business banking at Triodos, told BusinessGreen the bank expects to receive applications from significant numbers of large-scale solar farm developers in 2011. But he warned that many of them will be turned away, especially if they have not secured planning permission and other consents before applying for financing.

Under the feed-in tariff scheme, individuals or developers who install renewable energy systems receive payments from their energy supplier based on how much energy they generate. But the government is set to review rates in 2012, or potentially sooner if installation rates are higher than expected, and has already identified scope to cut feed-in tariffs by up to 10 per cent.

Watts said 2011 will be "a huge year" for solar developers as they rush to get projects under way before the incentives are cut. But he warned many projects are going to be under a lot of time pressure and will fail to secure planning permission or other relevant consents before 2012.

Source:BusinessGreen