Nola Capital Corporation Announces Results of Waste-to-Energy Industry Survey

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Waste-to-Energy companies face a challenging financing environment for their projects.

"It is obvious people need to be selective who they deal with so they don’t waste an inordinate amount of time trying to obtain financing."

U.S. waste-to-energy companies are struggling to find adequate financing according to a study released by Nola Capital Corporation.

The survey received confidential responses from more than 150 public and private businesses in 31 states that included waste-to-energy companies, lenders, investors and industry consultants. The amount of financing being requested ranged from a low of $2 million to a high of $85 million.

“The amazing thing we saw in the survey was 68 percent of the respondents voiced concerns about their ability to source adequate funding for their projects. It is obvious people need to be selective who they deal with so they don’t waste an inordinate amount of time trying to obtain financing,” said Art Housholder, a Managing Director of Nola Capital Corporation.

“But the survey shows a majority of corporate borrowers still see opportunities in the future that involve either building or purchasing additional waste-to-energy facilities,” added Housholder.

Among the results:

  • 72 percent of the waste-to-energy companies in the survey said their financing needs were for expansion or acquisition and their current operations are either modestly or highly profitable.
  • 97 percent of all respondents said they were optimistic that the need for waste-to-energy projects will continue to be strong in the future.
  • 47 percent of all respondents predicted a modest slowing of the nation’s economy within the next 12 to 18 months.
  • 23 percent predicted a substantial slowing of the nation’s economy.
  • 8 percent of the waste-to-energy companies surveyed said their needs were primarily for recapitalization or refinancing of existing debt.
  • 59 percent of the waste-to-energy companies surveyed said they had at least one failed funding attempt over the past two years.
  • 58 percent of the lenders/investors surveyed said they had closed at least one waste-to-energy funding in the past year.
  • 61 percent of all respondents said it normally takes at least 6 months to close a funding after a LOI is signed.
  • 4 percent of waste-to-energy companies surveyed said they had sourced capital from more than one source over the past year.
  • 71 percent of waste-to-energy companies said it took them 12 months to 18 months to find and close funding for their projects.
  • 79 percent of lenders/investors said their primary obstacles to funding projects were technology concerns, an aversion to what they consider to be a risky industry and inadequate equity in the projects.

Householder said his company originally initiated the survey for internal use, but then decided the results would be interesting to the public.

Nola Capital will conduct the survey every six months to determine trends.

About Nola Capital Corporation

Depending upon a particular project, the company may act as a funder, a table underwriter or a capital partner in a financing for U.S. private or public projects. For further information please visit the Company’s website http://www.nolacap.com.

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