Deutsche Bank lends US$1b in Japan solar gold rush
German lender joins Goldman Sachs in funding cleaner energy in the country as the government struggles to restart nuclear power plants
Deutsche Bank plans to lend about US$1 billion for Japan solar projects, joining Goldman Sachs Group in funding cleaner energy as the government struggles to restart nuclear power plants after the Fukushima disaster.
The Frankfurt-based lender agreed last month to provide an 11.1 billion yen (HK$843.4 million) loan for a solar power project on a former golf course north of Tokyo to be operated by a unit of Spain's Gestamp Renewables Corp.
Japan may add the most solar power capacity in the world this year as a two-year-old incentive programme attracted investors including Goldman Sachs. Even so, renewable energy accounts for less than 11 per cent of its total production, compared with 31 per cent in Germany, leaving the country reliant on fuel imports after the closure of all its atomic reactors and contributing to 23 consecutive months of trade deficits.
"Every time a country implements these very, very attractive standards, you have a gold rush and that gold rush started two years ago," Van Der Sande said. "Now the water is kind of pulling back, smaller people are leaving and the real players are staying."
Deutsche Bank declined to disclose the interest rates for the solar loans. The average new lending rate in Japan was a record-low 0.779 per cent in May, data from the central bank showed. Average interest margins on US dollar lending in Asia-Pacific outside Japan were 2.35 percentage points so far this year.
"We got reverse inquiries from some of our clients offshore saying 'we are interested in Japan solar and developing projects there but having difficulty getting finance from Japanese banks'," said Van Der Sande.
