Deutsche Bank AG plans to lend about $1 billion for Japan solar projects, joining Goldman Sachs Group Inc. in funding cleaner energy as the government struggles to restart nuclear power plants after the Fukushima disaster.

The bank is ready to provide financing for three to six projects in the next 12 to 18 months, said Hans Van Der Sande, director of Deutsche Bank’s structured products group at its Tokyo branch. The Frankfurt-based lender agreed last month to provide a 11.1 billion yen ($109 million) loan for a solar power project on a former golf course north of Tokyo to be operated by a unit of Spain’s Gestamp Renewables Corp.

Japan may add the most solar power capacity in the world this year, according to Bloomberg New Energy Finance, as a two-year-old incentive program attracted investors including Goldman Sachs. Even so, renewable energy accounts for less than 11 percent of its total production, compared with 31 percent in Germany, leaving the nation reliant on fuel imports after the closure of all of its atomic reactors and contributing to 23 straight months of trade deficits.

“Every time a country implements these very, very attractive standards you have a gold rush and that gold rush started two years ago,” Van Der Sande said in an interview. “Now the water is kind of pulling back, smaller people are leaving and the real players are staying.”

Lending Rates

Deutsche Bank declined to disclose the interest rates for the solar loans. The average new lending rate in Japan was a record-low 0.779 percent in May, according to central bank data. Average interest margins on dollar lending in the Asia-Pacific region outside of Japan were 2.35 percentage points so far in 2014, according to data compiled by Bloomberg.

“We got reverse inquiries from some of our clients offshore saying ‘we are interested in Japan solar and developing projects there but having difficulty getting finance from Japanese banks,’” said Van Der Sande. Local banks tend to require that project sponsors use Japanese solar panels that international operators don’t want to use because they are more expensive, he said.

Unprecedented BOJ stimulus to overcome deflation has lowered interest rates in Japan. The benchmark 10-year yield has dropped 24 1/2 basis points, or 0.245 percentage point, to 0.55 percent since December 2012 when Prime Minister Shinzo Abe came to power calling for an expansion of monetary easing.

The yen has weakened 15 percent during the period to 101.85 per dollar as of 3:58 p.m. in Tokyo, making it more expensive for Japan to buy fuel from abroad.

Goldman Projects

At least three of 12 solar power plants that Goldman Sachs helped organize through investor funding are producing power, according to Toru Inoue, a vice president at the U.S. bank’s Infrastructure & Structured Financing Group in Japan.

Insurance companies have invested in bonds arranged by Goldman Sachs and sold by special purpose companies established for the purpose of funding solar deals, Inoue said. Two projects in Japan’s northern Miyagi prefecture raised about 1 billion yen in funding through the sale of notes that carried either an A-or A rating from Japan Credit Ratings Agency Ltd., according to documents from Goldman Sachs.

The bonds carried a premium over similarly rated straight corporate debt because of the relative newness of the product and lower liquidity, he said. Investors want bigger deals and more liquidity, according to Inoue.

Megabank Deals

Mizuho Financial Group Inc., Mitsubishi UFJ Financial Group Inc. and Sumitomo Mitsui Financial Group Inc. provided about 164 billion yen in funding for disclosed solar projects in Japan, or 89 percent of the total, as of May 23, according to Takehiro Kawahara, an analyst at Bloomberg New Energy Finance. He expects the nation to add 10,300 megawatts of solar capacity this year.

“While international investors have also been very keen to enter the Japan solar market, very few have been successful thus far,” said Kawahara. “While there is no legal barrier to entry, the large number of entrenched Japanese financial institutions make it difficult for international players without local partners to enter the market.”

The Japanese government’s subsidy program originally paid about triple the amount Germany extended for its solar industries.

Japan approved a cut in tariffs for solar power as a building boom meant the technology made up 97 percent of new renewable capacity since it offered incentives.

High Tariffs

The tariff was reduced in April 2013 to 37.8 yen per kilowatt hour from 42 yen. Japan’s method of subsidy for the industry is similar to the program Germany, Spain and the U.K. implemented, offering an above-market rate for solar power.

Japan gave final approval in March for the 11 percent cut to 32 yen a kilowatt-hour for the 20 years from the fiscal year starting April and offered 36 yen for offshore wind, the Ministry of Economy, Trade and Industry said in a statement. Japan’s sales tax rose 3 percentage points to 8 percent in April and should be added to each rate from then, while the previous tariffs included the lower 5 percent rate.

Orix Corp. began building a 51-megawatt solar power plant on a former golf course in the western prefecture of Mie. The plant will start running in May 2016, the company said in a statement June 4.

The Tokyo-based finance and leasing company has been building large-scale solar power stations across Japan. The company said in April that 17 plants have started running with a combined capacity of 41.3 megawatts.

Mizuho Bank Ltd. and partners will provide loans for a 111-megawatt solar power station being built on the northern island of Hokkaido by SoftBank Corp.’s clean energy unit and Mitsui & Co., according to a statement on March 7. Development Bank of Japan Inc., Sumitomo Mitsui Banking Corp. and nine other institutions will also finance the project.

“Many of clients we talk to are talking to Japanese banks, but I think many of them are finding it difficult to believe that they will ever get financing there,” said Deutsche Bank’s Van Der Sande. “The Japanese banks are very busy making solar loans to their good Japanese clients.”

Kawa Solar (Conergy Group) has secured a bank guarantee facility of $60m for the expansion of the company’s solar projects business.
The loan facility has been arranged by Deutsche Bank and financed by Tennenbaum Capital Partners and is expected to strengthen financial support across Conergy’s power plants value chain.
The value chain ranges from project development, through the engineering, procurement and construction (EPC) of new plants, to the operations and maintenance (O&M) of completed plants.
Conergy Group global COO Alexander Gorski said the new financing will allow Conergy Group to rapidly scale up global projects business.
“Backed by strong equity investors, we have generated exceptional growth in utility-scale projects this year,” Gorski said.
Conergy’s EPC business has been managing solar power plants totalling 650MWp worldwide and the O&M business for the management of 300MWp of assets for 200 customers, to date.
“With the new bank guarantees, Conergy Group is expected to accelerate its participation in high growth markets.”
Conergy Group board member Andrew de Pass said: “The support of Deutsche Bank and Tennenbaum Capital Partners positions Conergy to execute its global growth plan in solar power projects, and confirms Conergy as one of the strongest downstream companies in solar with a truly global footprint.”
Tennenbaum Capital Partners managing director Timothy Gravely said: “We have deep expertise in the energy technology sector and we are pleased to leverage that on behalf of Conergy.”
With the new bank guarantees, Conergy Group is expected to accelerate its participation in high growth markets while expanding project capacity supported by bank guarantees by up to 400MWp.
Conergy’s projects are backed by majority shareholder Kawa Capital Management.

Unidaan FZ LLC tapped to supply Vikram Solar solar products and services in ‘MENA’ region.

BNRG Renewables, an Irish-based solar energy group, has raised €918,000 to re-finance two solar farms in Kent powering 82homes using the power of online crowdfunding.

The two 249kW sites in the UK, known as BNRG Gorse, have over 540 investors each expecting inflation linked returns of 7.35pc with BNRG funding the projects initially off balance sheet and now re-financed by way of crowdfunding using the site Abundance.

While BNRG have previously funded one of their solar developments through Abundance, BNRG Gorse is their first project in which Irish resident investors (as well as those throughout the European Economic Area) could invest as well.

The company have heralded the growing success of crowdfunding as a legitimate model of raising funding for a business by allowing them to source funds cheaply from a larger group of people, some of whom may have only very modest sums to invest.

The minimum investment for the project was just €6.29 which can be held for as long as 20 years and BNRG’s founder, David Maguire, believes they will continue to use it for some of their future projects: ““While our core business is in larger utility scale projects of which we have developed and constructed over €150m worth of assets, we have developed a number of commercial scale projects and crowdfunding is a great solution for these smaller renewable projects. It feels fantastic to be playing a wider part in a sustainable economy, not only offering clean power but good investments directly to the public.

A memorandum of understanding signed this past week sets up an agreement between BC First Nations and the Clean Energy Association of BC (CEBC) to cooperate in developing British Columbia’s renewable sector, including hydroelectric power.

The document — which includes the signatures of 13 First Nations groups, the First Nations Energy and Mining Council, and CEBC — also includes wind, biomass, biogas, solar, geothermal and natural gas generation.

“There is no reason why the clean energy sector cannot power a new era of economic development for First Nations in British Columbia,” Sechelt (shishalh) First Nation councilor Garry Feschuk said. “First Nations are distributed throughout B.C and so are the clean generation fuels. We should all be able to benefit from this sector.”

British Columbia is home to 125 First Nations groups that have had some involvement in the development of renewable energy so far, CEBC said, and all are still welcome to sign the memorandum.

“British Columbia’s clean energy sector has a strong track record of working collaboratively with First Nations to promote economic development,” Minister of Energy and Mines Bill Bennett said. “Working with First Nations is a key part of doing business in British Columbia, and this MOU will help to strengthen these important partnerships.”

Brazil is drafting local-content policies designed to spur the development of a domestic solar- manufacturing industry.

PSEG (NYSE: PEG) Solar Source will acquire a 13-MW solar power facility near El Paso, Texas from juwi solar (JSI) for $22 million.

JSI developed the PSEG El Paso Solar Energy Center and is leading the engineering, procurement and construction of the project.

“We are actively evaluating solar projects throughout North America and are pleased to be making our first solar investment in Texas,” said Diana Drysdale, president of PSEG Solar Source. “In addition to continuing our expansion into more states, this project will increase our solar capacity to more than 100-MW, which is a great milestone as we build our business.”

Upon completion, JSI will operate the project for PSEG Solar Source.

El Paso Electric Company signed a 30-year power purchase agreement for power produced at the facility, which is adjacent to the existing El Paso Electric Newman Generating Station.

The site is expected to be completed by the end of the year.

Renewable energy may reap as much as two-thirds of the $7.7 trillion in investment forecast for building new power plants by 2030 as declining costs make it more competitive with fossil fuels.

According to the Global New Energy Development Report 2014, China has surpassed Germany as the world’s largest PV market. The report, which was prepared by Hanergy Holding Group and China New Energy Chamber of Commerce, provided a comprehensive and authoritative overview of the global renewable energy market.

Trina Solar will supply 60MW of PV modules to Xinyi Solar for solar projects in Anhui, China, which will be used in utility scale and agricultural greenhouse solar projects.

Of the total 60MW, Trina Solar will supply 5MW of its TSM-PC05A modules, 30MW of TSM-PC14 modules and 25MW of dual glass TSM-PDG5 modules.

The PDG5 dual glass solar panel will be used as a roof bracing piece for an agricultural greenhouse located within Xinyi Solar’s power plant in Anhui province.

According to Trina solar, compared to conventional modules, dual glass PDG5 modules offer appropriate transmittance of sunlight, which better maintains greenhouse temperatures

In addition to this, their high performance in harsh environments offers resistance to the use of pesticide sprays in the greenhouse.

Panel shipments are expected to be completed by August 2014.

Trina Solar Module Business Unit president Zhiguo Zhu said the company is pleased to be working with its long term strategic partner Xinyi Solar to support its continuing solar project development in China.

“Following the launch of our PDG5 module in early 2013, Trina Solar has received significant interest from both existing and prospective customers due to its superior value proposition and numerous unique features,” Zhu said.

“With an extended 30-year warranty, our modules will be able to maintain a stable output throughout the course of their life time, which we believe will ultimately generate high returns for our customers.”

Wesley Lee, CEO of Xinyi Solar, said, “We chose to partner with Trina Solar because they not only offer a wide range of diverse products but also due to their continued efforts in R&D and innovation. We believe Trina’s high quality dual glass solar modules are the best fit for our project needs out of the products currently available on the market for our project. We look forward to continuing to work closely with Trina Solar as we develop our downstream business across China.”

Trina Solar said that its PDG5 is a UL/IEC certified frameless module comprises two layers of 2.5mm heat-strengthened glass.