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Awakened investor interest in geothermal – key take away of IGC Invest Geothermal

EGEC panel at IGC Invest Geothermal conference, Frankfurt/ Germany
Alexander Richter 9 Nov 2017

In an exclusive and well attended first IGC Invest Geothermal - geothermal finance and investment forum, participants explored geothermal investment opportunities and heard about ways of financing projects.

The first IGC Invest Geothermal, a global geothermal investment and finance forum, was successfully concluded this week. In an exclusive setting, with a wide representation of investors, bankers, lawyers and developers, lively discussions provided a positive outlook for the investment opportunities in geothermal development worldwide. The event was organized by Enerchange and ThinkGeoEnergy. The event has been able to

With a diverse group of speakers, the event brought together a wealth of experience, geographically, with participants from Indonesia, Turkey, USA and Europe. Rather interesting presentations on financing geothermal development and its value for developers and investors provided a great insight to opportunities worldwide.

In the opening session, geothermal in generals and the worldwide development was introduced by Alexander Richter from ThinkGeoEnergy. Amanda Lonsdale from the East Africa Geothermal Facility showed the challenges that especially in the drilling phase there is a lack of financing. Moreover financing is either private or public, but a combination of both does not exist so far. Benjamin Richter of Rödl & Partner introduced the benefits of the technology and the return on investment. Looking at the value of geothermal projects at the different stages was then the topic of a presentation by Gunnar Tryggvason of KPMG in Iceland.

The second session, the EGEC Policy Forum showed the development in different countries looking at how different countries have used a variety of different support schemes to stimulate the geothermal development. This has guaranteed  continuous geothermal project development. Very popular are feed-in tariffs and risk insurance schemes for initiating the geothermal development. One of the question discussed is how long a public feed-in tariff should be prolonged and should there be a slight degression or a sudden end of the support?

Presentations by Philippe Dumas of EGEC, Paolo Bertuzzi, CEO of Turboden, Cornelia Viertl of the German Ministry for Economic Affairs and Energy gave a general overview on the challenges faced by governments and the industry in pushing the market deployment.

On the experience in the French market and what its companies have to offer internationally, Jean-Jacques Graff of ÉS Géothermie and President of the French Geothermal Association talked about past and ongoing development, as well as what can be learned from the experience.

Deniz Yurtsever of EBRD introduced her bank’s support scheme for geothermal development in Turkey, which has been a very successful tool in the dramatic growth of geothermal power generation capacity in the country.

The current market and the business opportunities in Indonesia, were presented by Budi Herdiyanto of Indonesia’s Ministry of Energy and Mineral Resources, highlighting the incredible growth for geothermal generation capacity planned in the country.

De-risking geothermal projects showed the development worldwide with an overview by Maria Ueltzen from the Key Partner Rödl & Partner, and focused after the presentation about the KfW funding programs for Latin America on the Indonesian development. Here Ilham Nugroho form the Ministry of Finance and Pradana Murti, from PT SMI introduced the new Indonesian mechanisms for de-risking projects in Indonesia to become the leading geothermal country worldwide.

The panel on early stage and project finance, featured a discussion round with Johan Larssen of Climeon, Tim Jackson of InfraCo Africa, Eirikur Bragason of KS Orka, as well as Adel Baba Aissa from Geotermico. Representing a developer, supplier and investment funds, the discussions gave an interesting view on how a faster development starting with smaller sized plants could make a difference, as well as adding additional revenue streams e.g. in the form of heat to projects. The session was closed with a presentation on project financing by Hezy Ram of GreenMax Capital Advisors, and on due diligence for power plant development by Hartwig Schröder of enpros.

In the final session, the Blended Finance roundtable, Andrew Johnstone from Climate Investor One showed his model in the combination of private equity and public finance to develop renewable projects worldwide. For the integration of geothermal especially the risk might be show stopper. How this can be dealt with was shared with in a lively discussion by Tim Jackson of InfraCo Africa, Deniz Yurtsever of EBRD, Hezy Ram of GreenMax and Amanda Lonsdale of East Africa Geothermal Facility.

Overall, the conference and discussions showed a grown interest by the finance community on financing geothermal projects, but also an interest to explore new ways of financing projects and potential partnerships.

Participants of the IGC Invest Geothermal will get an access code for the presentations to download by next week. If you were not able to attend and would like to get the presentations and the participant documentation, it is available for purchase for EUR 150 (incl. VAT). If you are interested send an email to agentur@enerchange.de