Green Financial Risk Manager

Better access to low-cost capital is critical to improve the affordability of clean energy transitions

Putting the world on a path to achieve net zero emissions by 2050 requires a substantial increase of capital-intensive clean energy assets – such as wind, solar PV, energy efficient buildings, electric vehicles and hydrogen electrolysers – which have relatively high upfront investment costs and lower operating and fuel expenditures over time. Around 70% of clean energy investment over the next decade will need to be carried out by private developers, consumers and financiers. Rapidly increasing investment in clean technologies also depends on enhancing access to low-cost financing, particularly in emerging and developing economies. While clean energy transitions rely on much higher levels of both equity and debt, capital structures also hinge on the widespread mobilization of low-cost debt, e.g. for new capital-intensive, utility-scale solar projects supported by long-term power purchase agreements. 

Financial risk management

The aim of risk management is, generally, to identify, measure, and manage risks that could have a significant impact on the business' goals. In this context, the focus is twofold, ensuring that the company can meet its financial obligations, and ensuring predictable business performance. Treasurers are then tasked, more specifically, with managing:

1.     Liquidity risk: the company is unable to fund itself or is unable to meet its obligations; overlapping the above

2.     Market risk: changes in market prices (typically foreign exchange, interest rates, commodities) cause losses to the business

3.     Credit risk: that a counterparty default causes loss to the business.

Operational risk - losses to the business due to fraud or error - will sometimes fall under Treasury, although as these risks are not directly financial in nature, they are often delegated to a dedicated risk management team. In many sales- or lending-oriented businesses, credit risk is likewise not in direct Treasury's team scope. However, Treasury, will exercise some oversight regarding both. 

Cash flow and CAPEX planning made easy

Can you map your cash flow and CAPEX planning with a comprehensive solution that enables integrated financial planning? 

Does your solution offer the flexibility to simulate various scenarios, analyze the impact of your investments, and demonstrate the planned liquidity of your company? 

Do you have the time to focus on the planned strategic decisions that should drive your company forward? 

Green Financial Risk Manager fulfills your requirements !