Overview

Sky Energy Capital

Sky Energy Capital Inc. is an advisory firm focused on providing financing solutions to the clean energy sector.

A key area of expertise is commercial-scale solar and energy efficiency project finance. Presented with the right opportunity, Sky Energy Capital will consider investment opportunities in the broader renewable energy and sustainability arena.

Solar - A Time to Shine

A convergence of favorable  factors make the solar power development sector an especially compelling area in which to invest.

  1. Price - Solar photovoltaic (PV) panel prices have declined significantly.  Over the past five years, prices for solar modules have decreased more than 60%.  Many market analysts predict a continued trend of falling prices due to high levels of module supply capacity and intense competition among the manufacturers; many of whom are now based in China.
  2. Innovation -  Constant technological innovation has been another attribute inherent to the solar industry, as solar modules become increasingly efficient over time.  Perhaps more important, the recent advent of thin film technology has enabled manufactures to reduce their production costs to well below $1.00 per watt.   Many market analysts predict that solar will reach “grid parity” in certain jurisdictions (be able to compete with traditional sources of electricity generation without subsidies) in just a few short years, due to ongoing innovation in this highly competitive environment.
  3. Opportune Timing - Government incentives for renewable energy development are currently available. One of the most successful programs for encouraging investment and accelerating the growth of the renewable energy sector came about with the introduction of the Feed in Tariff (FIT) program. Initially pioneered in Germany in 1990's and having undergone a number key modifications over past twenty-five years, the FIT model has since been emulated by more than 30 other countries.

What is a Feed-In Tariff Program

A feed-in-tariff program is a policy mechanism aimed at accelerating renewable energy development by offering long term, fixed rate power purchase contracts, at above market rates for renewable electricity production.  Policy makers determine appropriate power prices for each renewable energy technology based on its development costs and calculating what Return on Investment (ROI) developers would need to earn, in order for them to pursue the construction of a renewable generation facility.

With a signed Power Purchase Agreement (PPA), offering developers certainty over contract price and duration,  the investment risk is largely removed for many types of renewable energy projects - particularly PV Solar.

Other jurisdictions, like the United States, also offer generous incentives, but do so via tax credits, grants and loan guarantees. For example, many renewable energy projects qualify for a 30% grant (refund) based on the eligible capital costs of building the renewable power facility.  However, a feed-in tariff program is considered by many to be the most effective method for encouraging private capital investment to flow into the development of new renewable energy production facilities.

The combination of these favorable factors present investors with an unusual opportunity to achieve attractive risk adjusted returns in certain jurisdictions in North America and within particular sectors of the renewable energy industry.

Ontario’s Feed-In Tariff (FIT) Program

Within Canada, the province of Ontario represents one of the the most attractive jurisdictions for investing in the renewable energy space.  With the 2009 passage of Ontario's Green Energy Act legislation, and through 20 year, fixed-rate power purchase agreements with Ontario's grid operator, IESO, renewable energy producers benefit in receiving long-term, above market rates for their renewable energy production.

Sky Energy Capital Inc.

Suite 706 - 522 Moberly Road
Vancouver, BC | V5Z 4G4
Phone: 604.229.1945
Fax: 604.229.1945