Energy Project Financing and Pricing for Economic Development : Present a write up on the above...


Energy Project Financing and Pricing for Economic Development :

Present a write up on the above topic and subject matter and also suggestions on contemporary issues.

Project Financing :

Project financing is a combination of two words *Project*, which means a combination of activities that have an ending point or completion point. And *Financing*means funding of the project to start a project.

Answer and Explanation:

Energy project financing means sources of funds are recognized through which projects can get finance and plan can be started. The project involves a group of activities that leads to a different result, and it is different from routine activities. Many companies are formed, and programs are launched to provide funds for an energy project. Financing of energy projects leads to various economic development, such as:

_Economic Development

  • Energy projects like _ solar and wind energy play a vital role in the development of an economy as these energies are beneficial for society. Economic developments like _ new technologies are used to generate power, powers are environmentally friendly, and productivity from natural resources increases.
  • Renewable energy generation projects have grown in modern times, and investment in these projects is more. So more financing must be done to expand and innovate these projects.
  • Society is becoming more aware day by day when they came to know about the importance of the resources.

Example_ Solar panels are placed by many persons over their houses for electricity generation in foreign countries.

Energy project pricing means analyzing the cost of the project as, according to the price of project funds will be raised. This pricing helps in economic development by analyzing social- cost-benefit analysis as to what is the price of the project and what benefits will be offered by this project to the economy. As cost is more but benefits are not sufficient that that project will not lead to economic development.

Example _ British Petroleum has given funds for oil and gas generation plants in the North Sea.

_Suggestions regarding financing, these projects as these are essential for economic development are _

  • These are environment-friendly projects, which are vital to utilize the energy resources provided by nature. Financing these projects became more important than the funding of corporate projects.
  • The standard of living of people raises as they have power and other resources to use.
  • Employment is generated in society as workers are needed to convert renewable resources into useful energy.

Proper funding must be done as these projects are essential for the development of an economy.

Learn more about this topic:

What Is Financing? - Definition & Types

from Corporate Finance: Help & Review

Chapter 8 / Lesson 7

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