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Significant renewable energy (RE) investments have to be implemented in order to achieve the ambitious RE targets set in the EU for 2020 and beyond. Moreover, a great amount of capital has to be leveraged, as these projects are followed by high investment and financing costs. Main aim of this paper is the provision of a comprehensive assessment of the existing risk elements of RE investments in relation to the respective policies and the evaluation of their impact on the weighted average cost of capital (WACC) in Greece. A consultation procedure with key national energy stakeholders took also place, including policy makers, project developers, investors, equity providers, bankers and energy analysts in the Greek RE market, in order to provide a validation of the respective results. It has been concluded that the policy design risk represents the risk element with the greatest impact on the cost of capital and, thus, the level of RE investments' deployment. Βased on the cost of capital valuation process followed, the WACC was estimated to reach approximately 12% for onshore wind and little lower values for solar PV projects in Greece. ; This work was supported by the Intelligent Energy Europe (IEE) Programme within the framework of the project "DIA-CORE - Policy dialogue on the assessment and convergence of RES policies in EU Member States" (Project Number: IEE/12/833/SI2.645735), the Horizon 2020 Programme of the European Commission in the context of the project "TRANSrisk - Transitions pathways and risk analysis for climate change mitigation and adaptation strategies" (Grant Agreement No. 642260) and the European Climate Foundation within the framework of the Pricetag project (Project Number: EPONL17190).

The European Union has set itself a binding target of "at least" 20% renewable energy in final energy consumption by 2020. To meet this target, considerable investments are required. Total annual investments are estimated at €60-70 billion per year. These investments will have to come from investors, bankers and equity providers. In contrast to investments in conventional electricity generation, investments in renewable energy sources (RES), such as wind and solar power, require large upfront investments, but low working/operating capital. Most investments are to be made upfront, before the system becomes operational. From an investor's perspective, this means that the overall investment risks increases. To compensate for this risk, investors require a higher rate of return on their investments, leading to increased cost of capital for RES investments. Before investing in a renewable energy project, investors indeed perform a risk analysis to decide whether to invest or not. If investors perceive an investment as risky, they will demand a higher fee for making capital available. The cost of this compensation – the cost of capital - must be paid from the revenues of the projects and, thus, directly influences the cost structure of the project. If the investment is perceived as risky, the cost of capital increases. Due to the capital-intensiveness of renewable energy projects, the cost of capital is a crucial element in every renewable energy investment decision and can significantly influence the business case of a project. To address these risks and, thus, lower the cost of capital, RES policies are designed to create more certainty in revenues and expenditures of RES projects. In case policies fail to address uncertainties, the increased cost of capital might cause a decrease in the number of RES projects actually realised, as only highly profitable projects will be implemented. This makes the cost of capital a crucial and decisive factor for RES investments and, subsequently, for meeting the EU 2020 RES target. The DiaCore project aims at providing an estimation of the current cost of capital for wind onshore projects across the EU and assessing the impact of policy design changes on cost of capital. According to our findings, the Weighted Average Cost of Capital (WACC) significantly varied across EU Member States between 3.5% in Germany and 12% in Greece for onshore wind projects in 2014.