IRENA and Terrawatt Initiative team up to boost global solar development

The International Renewable Energy Agency (IRENA) and the Terrawatt Initiative ahve agreed to collaborate to scale up solar energy under a new initiative officially launched on the margins of InterSolar Europe.

Leaders in energy, finance and law will collaborate to scale up solar energy under a new initiative officially launched on the margins of InterSolar Europe. The Solar Energy Standardisation Initiative, led by the International Renewable Energy Agency (IRENA) and the Terrawatt Initiative, aims to spur global solar development by standardising contracts to streamline the development and finance of solar projects.

Country commitments submitted under the Paris Agreement entail roughly USD 1.2 trillion in solar energy investment by 2030. To reach this target, governments must implement efficient regulatory schemes that enable massive development of solar projects – with minimal risk – and allow private investors to enter the market at scale. There is also a need to reduce transaction costs so solar power can penetrate more markets across the globe.

“High transaction costs for some solar projects are due, in large part, to the complexity of the contractual documents supporting the projects,” said Henning Wuester, Director of IRENA’s Knowledge, Policy and Finance Centre. “Simplifying the negotiation of these contractual documents will help reduce transaction costs, and allow investment in solar PV to advance more rapidly in more markets worldwide. That is what this initiative hopes to achieve.”

“This initiative aims to create a common industry language across all the assets, contracts or markets that are needed to develop renewable energy projects,” added Jean-Pascal Pham-Ba, Secretary General of the Terrawatt Initiative. “This will help quickly increase investment to the levels required to achieve global sustainable development and climate goals.”

The Initiative will bring together public and private sector stakeholders to define and agree on a standard template for solar project documents that are effective and acceptable by finance institutions.

The first meeting of the Initiative will be held, on the sidelines of Intersolar Europe in Munich, with stakeholders including Agence Française de Développement, Chadbourne & Parks, CITI, the Climate Bonds Initiative, the European Bank for Reconstruction and Development, Eversheds, Gide Loyrette Nouel, Global Solar Power, Herbert Smiths Freehills, the Inter-American Development Bank, the International Finance Corporation, Norton Rose Fulbright, Simmons & Simmons, Trilegal, the United Nations Development Programme, and Watson Farley & Williams.

The initiative aims to share templates and standard documentation by COP 22 in November 2016.