Financing Landfill Gas Projects in Developing Countries

This report offers an overview of the range of financial resources that may go into a financial assessment of an LFG system. This includes major sources of capital and operating funds, revenue from energy sales, and descriptions of incentives or support that may contribute to a project’s bottom line. Risk mitigation techniques, which are integral to successful financing, are also detailed and may be among the most important aspects to understand when undertaking an LFG project. The report is structured as follows: chapter one gives an introduction to LFG project development and discusses opportunities and challenges faced in developing-country contexts.Chapter two outlines the process of evaluating an LFG project’s feasibility. Chapter three details three broad categories of financing or funding (public sources, private sources, and sources based on environmental attributes of a project) that have been used in various permutations to facilitate the development of LFG infrastructure around the world. Chapter four outlines incentive schemes, such as feeder tariffs, beneficial tax structures, public guarantees, subsidies, and co-financing that are typically essential to a project’s development. Chapter five describes various types of risk at different stages of project development and offers mitigation techniques based on the advice of experts and practitioners. Chapters six-eight offer case studies from landfill gas projects in Thailand, Latvia, and Brazil. Shorter case examples intended to illustrate aspects of successful projects or combinations of the financing or funding methods are found throughout the document.