Technical assistance (TA) from development finance institutions (DFIs) plays a crucial role in the success of energy storage projects, particularly in emerging and high-risk markets. Here’s how TA impacts these projects:
Impact of Technical Assistance
- De-risking Investments: TA helps de-risk energy storage projects by providing feasibility studies, technical due diligence, and capacity-building services. This support can make projects more attractive to investors, leading to increased access to funding.
- Capacity Building: TA often includes training and advisory services that enhance the technical and operational capabilities of energy storage companies. This can lead to improved project planning, execution, and maintenance.
- Enhancing Bankability: By supporting the development of bankable project proposals, TA ensures that energy storage projects meet international standards and can attract commercial financing. This is particularly important in nascent markets where bankable projects are scarce.
- Integration of ESG Principles: Post-investment TA can help integrate environmental, social, and governance (ESG) principles into energy storage projects, enhancing their sustainability and social impact.
- Market Development: TA can also contribute to the development of regulatory environments and investment climates, making markets more conducive to energy storage investments.
Examples of TA in Action
- AfricaGoGreen Fund: This fund involves a technical assistance facility (TAF) that supports project development and provides capacity-building services, illustrating how TA can be structured to benefit specific sectors.
- DFC Technical Assistance: The U.S. Development Finance Corporation (DFC) offers technical assistance to prepare projects for financing, ensuring they meet development and commercial sustainability standards.
In summary, TA from DFIs can significantly enhance the viability and impact of energy storage projects by addressing key challenges in project preparation, execution, and sustainability.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-technical-assistance-from-dfis-impact-the-success-of-energy-storage-projects/
