tax credits, and political support that can transform project economics. v Define the project early : Big ideas are not enough. Investors want specifics. Clear scope, scale, site selection, and technology choices build confidence and accelerate partner alignment. w Conduct multi-disciplinary feasibility : Quality feasibility work separates concept and execution. Studies must integrate engineering with commercial viability, regulatory analysis, permitting, and environmental impact. Multi- disciplinary feasibility is essential. x De-risk technology and integration : Novel technology combinations create uncertainty. Strong teams demonstrate a clear grasp of TRLs, integration risks, and performance assumptions, supported by pilot testing, vendor vetting, and realistic modelling. y Build a bankable commercial model : Technical soundness alone will not suffice. Investors demand credible offtake agreements, price stability, and stress-tested models. Early conditional offtake and floor pricing add vital security. z Secure favourable legal and fiscal structure : Tax credit eligibility, grid interconnection, land use, and permitting paths can make or break a project. Successful developers address these early to avoid costly delays. { Demonstrate institutional credibility : Capital flows to trusted teams. Track record, EPC strength, and original equipment manufacturer (OEM) engagement must be visible and verifiable. Execution capability cannot be assumed – it must be proven. | Define and allocate risk clearly : Investors expect transparent, living risk registers that show acknowledgement, ownership, and mitigation. Ambiguity kills capital deployment. Together, these imperatives form a blueprint for bankable innovation. They are not a checklist to revisit at financial close – they are the foundation for FOAK success. Managing cost risk amid uncertainty Every major project today faces cost escalation due to the realities of trade policies, supply chain bottlenecks, inflation, and geopolitical tension. If left unmanaged, these erode bankability. Procurement strategy is the first line of defence. Developers are increasingly bringing
sourcing closer to the owner, gaining control over supplier selection, applying for volume- based discounts, and avoiding stacked markups. Timing matters too: advancing procurement can mitigate tariff shocks, though it may require upfront capital or storage. Price escalation cannot always be avoided – but it can be navigated. Where possible, lock in pricing for high-value or long lead-time equipment. Evaluate whether price adjustment clauses, indexed contracts, or financial hedging tools can stabilise cost exposure. Trade strategy is also legal strategy. In some cases, trade attorneys may be able to reclassify equipment under less-impacted tariff codes or secure duty exclusions. When options are limited, shifting sourcing to allied trade regions or countries with favourable bilateral agreements may provide alternative paths forward. When disruption is unavoidable, creativity becomes protection. Options include contracts with price floors or ceilings, trigger clauses for renegotiation, clear equipment specifications, or performance incentives for suppliers. Above all, it should ensure that total installed cost (TIC) reflects full exposure, not best-case assumptions. In short, cost and supply risk must be designed around, not designed through. Teams that manage uncertainty proactively will move forward while others stall in rework, renegotiation or redlines. FOAK projects will always carry complexity, but with the right frameworks, this can be transformed into clarity. By embedding bankability from the earliest stages, aligning technical choices with policy priorities, and addressing risks head-on, developers can bridge the gap between innovation and investment. The reward is more than just financing a single facility; it is building the confidence, credibility, and momentum needed to scale the technologies that will define the low-carbon economy. In the end, making innovation bankable is not only about unlocking capital – it is about accelerating the transition to a more resilient, competitive, and sustainable future.
Jacqui Allen Jacqueline.Allen@woodplc.com
www.decarbonisationtechnology.com
23
Powered by FlippingBook