The big question: what do you need for final investment decision?

William David Hartell

Managing Director and CEO of Stellae Energy

Stellae Energy is currently developing geothermal power projects across three volcanic island arc nations in the Western Tropical Pacific. Securing investment for renewable energy projects can pose significant challenges. Pre-financial investment decision (FID) funding is essential, as it typically involves early-stage equity investments, representing approximately 10% of the total project cost. Post-FID investment is typically structured as debt financing, which can require about 20% equity component.

One of the critical steps in overcoming financing challenges is educating potential investors

One of the critical steps in overcoming these financing challenges is educating potential investors about the renewable energy technologies involved. It is crucial to highlight that these technologies are well-proven, identifying risks and rigorous mitigations to sufficiently de-risk projects and the stage gate processes including independent assessments leading up to FID.

Renewable energy projects also require significant regulatory, legal and community approvals. Demonstrating proactive processes towards these approvals is necessary to provide confidence that planned schedules and investments in the business case will be maintained.

By providing this information, Stellae Energy is working to build investor confidence and support for our projects, helping to secure the necessary funding and reach the FID stage, which is pivotal for project execution.

About Stellae Energy

Stellae Energy is a UK-based energy development company that provides end-to-end technical and business collaboration, advisory solutions and assets for emerging and established organisations in energy, mining and renewables (geothermal, solar PV, wind, batteries, hydrogen/ammonia, waste to energy, fuel cells, and carbon capture and storage) sectors. These solutions and services include performance reviews, business transformation studies, digitalisation, conceptual frameworks, investment due diligence advisory, financing plans, exit strategies assistance, and project sanction and development stage gate support.

Gustavo Silva

Chief Operating Officer at Qair Brasil

Demand for clean energy is growing, and investments in major global energy projects are increasingly aligning with countries’ geopolitical and strategic priorities in order to drive the energy transition. This is reshaping energy markets around the world, resulting in larger-scale initiatives that require substantial investment and resilient infrastructure.

New niches and technologies are also emerging, creating opportunities for fresh entrants. As these new players join the field, there will be a growing need for pre-market agreements, stronger alignment with sustainability goals, and a business environment with a certain level of maturity.

Ensuring the long-term viability of projects requires access to financing solutions

To secure a FID, it is becoming essential to consider not only the business potential of the project but also the geopolitical landscape and the political and economic conditions in which it will operate. Ensuring projects’ long-term viability will require access to financing solutions that can adapt to these evolving market dynamics and sustain projects throughout their lifecycle.

About Qair Brasil

Qair Brasil, the Brazilian subsidiary of independent French power producer Qair Group International, leverages over 30 years of experience in the renewable energy sector with operations in more than 20 countries. Its project portfolio includes more than 10GW in renewable energy initiatives, with nearly 500MW already in commercial operation and an additional 100MW currently under construction. In the next three years, Qair Brasil plans to invest US$484m in expanding its footprint. The company is now advancing through the pre-implementation phase for more than 420MW of solar power capacity.

Michael Alsford

Chief Financial Officer at Storegga

Progressing to FID for carbon capture and storage (CCS) and low-carbon hydrogen projects depends heavily on a number of factors, including sufficient financial incentives, a supportive regulatory framework and proactive government action. Uncertainty in any of these areas can delay investment decisions significantly.

Governments play a pivotal role by providing reliable support mechanisms such as clear funding structures, tax incentives and grants. For example, the UK government’s use of contracts for difference offers revenue support to low-carbon hydrogen producers, reducing customer offtake risk.

Governments play a pivotal role by providing reliable support mechanisms

Banks can also play a crucial role by providing project-level financing, but securing investment can prove challenging for initial projects. The involvement of export-credit agencies and national infrastructure banks, such as the UK’s National Wealth Fund, could help to unlock this investment.

Regulatory clarity is equally essential. To mitigate risks and foster confidence, developers require well-defined rules on the business model, permitting process and liabilities exposure. Any uncertainty in these areas will increase investor caution and slow down decision-making.

Ultimately, consistent commitment from governments and coordinated infrastructure development will be critical. When the public and private sectors collaborate to create a stable environment with shared risks, projects are far more likely to progress to FID, enabling the scale up of the CCS and low-carbon hydrogen industries.

About Storegga

Storegga is a leading independent developer of CCS and hydrogen projects, dedicated to reducing global greenhouse gas emissions and driving sustainable energy solutions. With a diverse portfolio of pioneering initiatives, Storegga is at the forefront of advancing large-scale decarbonisation efforts. Its flagship projects include the Acorn CCS and Cromarty and Speyside hydrogen projects in the UK, Trudvang CCS in Norway, Penyu Basin CCS in Malaysia and Harvest Bend CCS in the United States. Storegga’s institutional shareholders include Macquarie, GIC, Mitsui, M&G, Snam and ADNOC.