How Wind Owners can Benefit from Fintech Platforms

Banking CIO Outlook | Friday, September 28, 2018

Digitalization has created an impact on almost every stage of a wind farm’s lifecycle. Software simulations and analytics, for instance, are assisting wind planner and owners in optimizing turbine placement and project development. With the help of smart sensors and IoT-enabled monitoring software, wind turbines can now diagnose themselves and even foresee component failures before they occur. By using a similar digital platform, wind owners can also optimize their profits as well as long-term project plans.

These platforms rely on fintech or financial technology, which is the application of modern technology to all kinds of financial processes and projects including solar and wind energy. According to Benjamin Cohen, CEO and founder of T-Rex—a provider of enterprise solutions for renewable energy project finances, the ultimate goal is to manage risks effectively, enhance capital costs, and also optimize the returns on investments. An efficient fintech platform is capable of collecting, managing, and analyzing data along with providing users with tips and suggestions that give their projects a boost.

Cohen also points out how it is almost impossible for humans to match the speed and performance of a fintech program by merely resorting to traditional financial models. With the help of automated checks on calculations, wind operators can make sure that the project’s revenue-driven operation and maintenance costs are adjusted for every purchase agreement in an hourly Power Purchase Agreement (PPA). Also, owing to the changing nature of renewables, conventional finance tools fail to provide the analytical precision required to monitor financial risks, which results in several high-potential projects failing to receive sufficient funding. As a result, fintech can be of great help to investors and owners of wind projects that produce returns based on both the winds and the energy demands.

The most common problem that wind owners face is that of data management. By leveraging a top-notch fintech platform, users can integrate and analyze information from various datasets. The prime objective of investing in fintech is to optimize the capital structure of a firm’s portfolio in addition to achieving better financial returns. Hence, wind owners must focus on a financial platform that is tailored specifically for the industry.

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