Asia’s transition to renewable energy is accelerating, but the region still faces significant barriers to scaling clean power. State-owned utilities—the dominant off-takers in most markets—must manage rising demand, system reliability, and political expectations while integrating intermittent renewable energy. At the same time, Independent Power Producer (IPP) sponsors are playing a growing role in financing, constructing, and operating large-scale energy infrastructure, especially through greenfield solar, wind, and hydro projects.
This guidance outlines how Asian off-takers and IPP sponsors, particularly Chinese IPP sponsors, can work more effectively together to deliver bankable, operationally sound, and socially accepted green IPPs. It provides actionable insights across the project lifecycle—from request for proposals (RfP) and power purchase agreement (PPA) structuring to construction, financing, and long-term operation.
Key findings include:
- For (Chinese) IPP sponsors: Success depends not only on financing capacity and engineering delivery, but on the ability to navigate complex local regulations, labour expectations, and payment or FX risk in the operation phase. Sponsors must align EPC and O&M performance with international standards, engage early on environmental and social safeguards, and structure projects for long-term reliability—not just construction speed.
- For Asian off-takers: The credibility of renewable expansion depends on issuing realistic and transparent RfPs, ensuring PPA structures support bankability, and providing timely permits, payments, and grid readiness. Many off-takers can improve coordination between central and local agencies, especially on land and environmental approvals, while upholding performance oversight and public accountability.
By preparing each phase of the IPP based on a growing awareness of opportunities and challenges, transaction costs for both IPP bidders and off-takers will be significantly reduced, while project delivery and quality should improve (see Figure below).
Phase 1 and 2: planning and tender
- Asian off-takers should issue clear, realistic Request for Proposals (RfPs), including draft PPA and (if applicable) Joint Venture term sheets. Bid evaluation criteria and local content requirements must be transparent and achievable.
- Chinese IPP sponsors should prepare for longer timelines and internal approval cycles, and seek early clarity on licensing, land acquisition, and currency risks.
Phase 3: Negotiation
- Off-takers must ensure PPA terms are bankable: long-term duration, fixed or indexed tariffs, and clear payment security mechanisms (e.g., escrow accounts, guarantees).
- IPP sponsors should be ready to address regulatory expectations, share risk on curtailment or technology changes, and provide cost-transparent EPC and O&M models.
Phase 4: Construction
- Off-takers should streamline permitting processes, support land access, and monitor construction timelines against PPA obligations.
- Chinese IPPs must meet local content rules, manage visa and labour constraints, and invest in training for local workforce integration. Clarity on cost responsibility for technical modifications is essential.
Phase 5: Delivery
- Off-takers must ensure timely payments and manage curtailment transparently. FX conversion mechanisms should be predictable to protect revenue repatriation.
- IPP sponsors should maintain high O&M standards, adopt international testing protocols, and monitor environmental and social compliance throughout the project life.
About the green IPP guidance document
The guidance can be downloaded as pdf here.
The guidance was written by Christoph Nedopil, Fabby Tumiwa, Mustafa Sayed, Muhammad Aulia Anis, Rika Isnarti and Umar Farooq. It was published together with Griffith Asia Institute, Pakistan China Institute, Institute for Essential Services Reform (IESR), and Climate Smart Ventures.
Dr. Christoph NEDOPIL WANG is the Founding Director of the Green Finance & Development Center and a Visiting Professor at the Fanhai International School of Finance (FISF) at Fudan University in Shanghai, China. He is also the Director of the Griffith Asia Institute and a Professor at Griffith University.
Christoph is a member of the Belt and Road Initiative Green Coalition (BRIGC) of the Chinese Ministry of Ecology and Environment. He has contributed to policies and provided research/consulting amongst others for the China Council for International Cooperation on Environment and Development (CCICED), the Ministry of Commerce, various private and multilateral finance institutions (e.g. ADB, IFC, as well as multilateral institutions (e.g. UNDP, UNESCAP) and international governments.
Christoph holds a master of engineering from the Technical University Berlin, a master of public administration from Harvard Kennedy School, as well as a PhD in Economics. He has extensive experience in finance, sustainability, innovation, and infrastructure, having worked for the International Finance Corporation (IFC) for almost 10 years and being a Director for the Sino-German Sustainable Transport Project with the German Cooperation Agency GIZ in Beijing.
He has authored books, articles and reports, including UNDP's SDG Finance Taxonomy, IFC's “Navigating through Crises” and “Corporate Governance - Handbook for Board Directors”, and multiple academic papers on capital flows, sustainability and international development.
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