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Feed-in tariffs allow investors to get a return on their investment at a lowish rate (7-8% for onshore wind, for instance), taking into account the leverage that can be put in place (again ,for onshore, 80% of debt at 5% cost or so).

Offshore, return expectations are a bit higher (but not that much) and debt is a bit more expensive so you get a average cost of capital at 8-9% rather than 6-7% for onshore.

Tariffs typically last 15 years but can be less.

Wind power

by Jerome a Paris (etg@eurotrib.com) on Fri Jul 20th, 2012 at 12:21:10 PM EST
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