Banks want to see “evolutionary rather than revolutionary” plans when it comes to providing the funding for new power projects.

Dipak Haria, associate director of Barclays Bank’s infrastructure and structured project finance team, said that this particularly applied to wind energy. “If it’s a completely new turbine we would need to see a lot of tests.”

Dipak Haria

He also told an energy conference in London that regulatory issues in Europe and the US were making investors very cautious about putting their money into the energy market.

He singled out the Electricity Market Reform in the UK – “launched a year ago but we still have no real detail” – and the soon-to-end production tax credit scheme in the US as two areas which are “causing a lot of uncertainty”.

He also said that recent national decisions on solar feed-in tariffs has been damaging for investor confidence. He said the “worst example was Spain” – where a new government stopped feed-in tariffs for solar power in January – and the UK, which he said had carried out a “botched consultation” that resulted in a High Court case which the government lost which stalled investor confidence.

These elements together had created such a pause in investment, he said, that European lending to energy infrastructure projects – which until recently had been dominant globally – had slipped, with Japanese financiers stepping in.

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