This working paper sets out to provide a short introduction to risk and return in making financing and investment decisions in the energy sector, focusing on renewable energy.
It will specifically draw on the outcomes of consultation roundtables with financiers on renewable energy policy to illustrate what financiers need from policy to reduce risk and increase returns; what types of issues arise in different policy frameworks; and how policy can affect the attractiveness of different investments. The review of the UK’s Renewables Obligation policy provides a useful focal point for illustrating the latter.