We have talked about private finance in general terms, but there are differences in appetite for new infrastructure between types of private finance. Commercial banks, for instance, see new projects as an opportunity to expand their customer/relationship base, whereas refinancing existing projects does not offer them these opportunities.
Although commercial debt is in the most senior or protected position should problems arise, equity will need to have been completely written off before commercial debt is at risk. But because debt-holders will have a far greater total amount of money at risk, their focus will always be on what can go wrong, what is the likelihood of these problems, and what can mitigate them if they do happen. Equity investors are also interested in these factors, but they will also want to consider the upside of the project.