Energy project finance reference. This educational resource covers project investment and financing concepts. It is separate from Jaken Energy’s commercial electricity and natural gas procurement service; it is not a financing offer or a promise of funding.
Offtake agreements and bankable revenue
An offtake agreement provides a contractual route to selling a project’s output. Price matters, but volume, quality, delivery, credit and remedies determine whether the expected revenue can support financing. A letter of interest is not an executed purchase commitment.
What to evaluate
Review commencement conditions, minimum purchases, take-or-pay provisions where applicable, force majeure, curtailment and termination. Identify who bears transport, imbalance or specification failures. Align the contract with the project’s realistic production capability.
Build a defensible comparison
A lender may require direct agreements, notice and cure rights or assignment consents. Assess counterparty financial strength and replacement options. A long term does not eliminate default risk; a fixed price does not eliminate volume or delivery risk.
Documents and questions to prepare
- Volume, quality and delivery obligations
- Commencement and termination conditions
- Counterparty credit and support
- Assignment and lender protections
For commercial property owners
Start with the property’s actual accounts, lease responsibilities and plans for ownership or sale. Keep commodity procurement, building improvements and project investment as separate decisions. Include the costs you retain and the savings you retain after tenant reimbursement. An improvement that lowers a tenant-paid expense may benefit tenants without producing the same increase in owner income.
Prepare a base case and a downside case using dated evidence for costs, revenue and funding. Any financing rate, tax benefit or return is a project assumption until supported by current documents. Legal, tax, engineering and lender review should follow the actual transaction.
For the existing property’s supply-cost decision, use the contract-cost calculator or request a property energy review.
Primary sources
Reviewed October 12, 2026. Program rules, tariffs and financing terms should be checked again before a transaction.