IMPROVING MECHANISMS FOR ATTRACTING INVESTMENT IN RENEWABLE ENERGY PROJECTS AT INDUSTRIAL ENTERPRISES

Abstract

The article examined mechanisms for attracting investment in on-site renewable energy projects of industrial enterprises. The author synthesised risk-return theory and the concepts of the cost of capital and de-risking, and interpreted corporate power purchase agreements, the sale of surplus electricity to the grid, green loans, green bonds, energy performance contracts and blended finance involving development finance institutions as a single system. Using the levelised cost of electricity formula, the author found that an increase in the weighted average cost of capital from 4 to 20 percent raised the levelised cost of solar electricity 2.7 times. The results showed that institutional measures lowering the cost of capital were the decisive factor of project efficiency. The financial and legal instruments created in Uzbekistan for industrial enterprises were systematised. A conceptual model was developed and proposals for attracting investment were substantiated. The results can be used by industrial enterprises, commercial banks and public authorities in setting the terms of financing for renewable energy projects.