projektfinanciering

Projektfinanciering, or project financing, is a method of financing large-scale, capital-intensive projects in which the lenders’ repayment primarily depends on the future cash flows generated by the project rather than the sponsors’ general creditworthiness. The arrangement typically centers on a Special Purpose Vehicle (SPV) that owns the project assets and contracts with builders, operators, and customers.

Finance is usually non-recourse or limited-recourse; lenders’ claims are directed at the project’s assets and cash flows, not the sponsors' balance sheets. The capital stack combines equity from sponsors, senior debt from banks or institutional lenders, and sometimes mezzanine finance, guarantees, or credit enhancements from export credit agencies or multilaterals. A robust set of project agreements governs risk allocation and performance: an engineering, procurement, and construction (EPC) contract; an operation and maintenance (O&M) agreement; an offtake contract (for example a power purchase or tolling agreement); and the financing documents, security packages, and covenants.

Advantages include isolating project risk, enabling large investments, and potential off-balance-sheet treatment in some accounting frameworks. Disadvantages are high transaction costs, lengthy deal structuring, extensive due diligence, and exposure to construction risk, regulatory changes, and revenue variability. The approach is common in energy, transportation, and infrastructure projects, but is also used in other sectors. Successful project financing requires clear revenue streams, credible sponsors, robust risk allocation, and effective contract enforcement.

In English, the term is project financing; the spelling projektfinanciering is used in several Northern European languages.