In Project finance, what is the best level of debt funding? higher the better or lower the better?

In my opinion lower level of debt is the best

debt funding has both higher and lower depended on the project cash inflow

I feel Debt funding has both the positive and negative impact depending on the project cash inflows .

As the cost of equity is very high , debt funding is a good option to save equity investment . The global ratio for debt:equity is: . Advantages : High IRR , Low Payback Period .

However , the same is very risky if your project does not generate the expected cash flows.

Project Finance depend on organization's paying capacity, project finance need and organization's overall anual turnover

A proper mix should be chosen depending on debt service cost, equity available, returns and risk appetite of stakehlolders

The optimal capital structure or debt to equity ratio is the one the maximizes the compayn's value. Theoretically, debt is cheaper (tax deductability), but it increases overall risk of the company.

In my opinion I think lower is better