PV Power Plant Project Development and Implementation in Southeast Asia. Renewable Energy Asia Exhibition 6th June, 2012

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1 PV Power Pant Project Deveopment and Impementation in Southeast Asia Renewabe Energy Asia Exhibition 6th June, 2012

2 Presentation outine 1 The PV project deveopment process 2 Key components of a PV farm 3 Typica business modes and financing structures PV Power Pant Project Deveopment Experiences 4 5 Key risks/issues to beware of and the mitigation measures, particuary in Asia Case studies on PV project deveopments 6 Q & A 2

3 The PV project deveopment process 10 good reasons to switch to soar photovotaic eectricity 1. The fue is free 2. It produces no noise, harmfu emissions or pouting gases 3. PV systems are very safe and highy reiabe 4. The energy pay-back time of a modue is constanty decreasing 5. PV Modues can be recyced and therefore the materias reused in the production 6. It requires ow maintenance 7. It brings eectricity to remote rura areas 8. It can be aestheticay integrated in buidings (BIPV) 9. It creates thousands of jobs 10. It contributes to improving the security of Asia's energy suppy 3

4 Current Soar Power Status PV modue price experience curve Evoution of prices of arge PV systems 4

5 PV Eectricity Generation Cost Leveised cost of eectricity (LCOE) Deveopment of utiity prices & PV generation costs 5

6 Soar Power Goba Market.. Goba Cumuative Instaed Capacity Share (MW; %) Evoution of Goba Annua Market Scenario per Region (MW) 6

7 Word map of goba cumuative capacity showing the acceerated and paradigm shift scenarios by region 7

8 Detaied Annua Historica Market Data and Outook for Asia Pacific Source: EPIA, May

9 Detaied Cumuative Market Data and Outook for Asia Pacific Source: EPIA, May

10 Goba Annua Cumuative Instaed Capacity per Region (MW) Source: EPIA, May

11 Thaiand s Soar Instaation Trend Source: NSTDA, Sep

12 PV Appications The Photovotaic technoogy can be used in severa types of appications: Grid-connected domestic systems Consumer goods Off-grid systems for rura eectrification Off-grid industria appications Grid-Connected Power Pants Soar Farms aso known as PV farms, BIPV and roof- top PV systems or so caed argescae centraized PV grid connected systems produce eectricity from the sun and se the eectricity to the utiity grid. 12

13 Genera Considerations for Large Scae PV Projects Project Considerations Areas with rich soar resources Areas where the eectrica grid is unavaiabe or unreiabe Access to transmission ines More distributed Large Pants Key Project Risks Component breakdown (e.g. Short-circuit) Weather damage Theft/Vandaism Risk management considerations Performance guarantee avaiabe (e.g. Up to 25 years) Standard components/easy substitution Maintenance can be negected Other considerations in SEA: Poitica and Financia Poitica and bureaucratic hurdes Lack of transparency projects driven by government Financia PV not competitive to grid eectricity Quaity contro Lack best practice standards 13

14 The PV Project Deveopment Process 1 st Step: Pre-Deveopment Find reiabe power purchaser and/or markets Determine the pre-feasibiity and expected output Obtain a icenses ike for exampe: PPA, grid connection and other oca icenses Secure the and; buy or ease decision 2 nd Step: Technica Seect the most efficient technoogy for the chosen ocation Find a reiabe turn-key contractor Obtain binding proposas Seect a suppiers and contractors 3 rd Step: Finance Prepare a fu feasibiity study and business pans Estabish access to capita and banks Sign a finance reated contracts Sign EPC contract and order a components 4 th Step: Impementation System instaation Secure agreements to meet a O&M needs Connect the system to the grid Finaize a documents and approvas to start the actua eectricity saes 14

15 Modue Types and Technoogies Modues Wafer technoogy 90 % market share Thin-Fim technoogy 10 % market share CPV Efficiency = 25% Mono-crystaine Efficiency = 16-19% Poycrystaine Efficiency = 14-15% A-SI:H Efficiency = 4-8% Micro-Crystaine Efficiency = 7-9% CdTe Efficiency = 10-11% CIS Efficiency = 7-12% 15

16 Centraized or Decentraized System Design Decentraized System Design Suitabe for systems in the ower MW range Easy to insta Less compicated to maintain Especiay suitabe for systems with different integrated soar generator types High output efficiencies Centraized System Design Suitabe for systems in the muti-mw range More cost efficient for arge scae power pants Especiay suitabe for systems with homogeneous soar generator types High output efficiencies 16

17 Mounting Systems Static system 1-axis 2-axis Output 100% 115 % 125% Occupied area 100% % 200% Maintenance Cost 100% 106% 120% 17

18 Monitoring and Contro Monitoring of centra inverters, tracking system and connection boxes Readout of inverter and string data Shows system status of a components and initiates aarm Internet porta Anaysis software Aarm function 18

19 Typica Business Modes and Financing Structure Project Finance is A funding structure that reies on future cash fows from a specific project as the primary source of repayment with that project s assets and rights hed as coatera security. Five key components are: Cash fow predictions Risk aocation agreements Funding and repayment mechanisms Lega security and provisions Project reporting and compiances 19

20 Contractua Situation in Typica PV Project Finance Structure Operations and Maintenance (O&M) Operator Government Sponsor = Equity Investor EPC Contractor SPV Specia Project Vehice Off take: Utiity or Markets? Banks: Lead Arranger Syndicate Bank 1 Land owner Insurances Technica/Commercia Syndicate Bank 2 Syndicate Bank n Poitica Risk Insurance 20

21 Genera Non-Recourse Structure Annex Power Investor EPC (PD?) A SPV P RE Pant Equity Debt Debt Faciity Bank Pedge a rights and securities 21

22 Overview Documents Project Document on Project side Lease Agreement(s) Off-Take Agreement EPC Contract Operation & Maintenance Agreement Reports (ight studies) Insurance Buiding permit Environmenta Studies (if appicabe) Technica Report (technica DD) Lega report (ega DD) Project Document on Financia side Direct Agreements The oan / Agreement The share Purchase Agreement Bank abiity criteria Back-to-Back structure Interactive with other Agreements Fixed price ( Lump sum ) Payment Procedure Security Currency Parent Company Guarantee Standard Bonds Technica requirements fuy agreed Fixed deivery date Suspension and Interruption of Performance Performance Guarantees Poitica risk Force Majeure Defects of iabiity > Caps 22

23 Key Risk Factors and Mitigation Strategies for PV Projects in Asia Project Phase Key Risks Mitigation Strategies Technica Specia component certification requirements by the oca authorities Grid-connection reated probems Component suppy shortages Seect ony components which fufi a oca requirements Buid a cose reationship the oca grid owner Use strong suppiers and EPC partners Financia Banks have imited experiences in PV debt financing, structures and risks Specia country reated documentation is normay needed There is ony a imited amount of equity investors for PV projects in Asia Eary reationship buiding with the bank is crucia Detaied, creditabe and in-depth documentation Eary reationship buiding with possibe equity partners is a crucia Government Loca suppiers coud be protected by high duties or other reguations High country and poitica risks Higher risk for sudden changes in the subsidy poicies Use of oca suppiers for keycomponents Use of oca banks and investors Use of oca government funding and support 23

24 Project Name: Thaiand 3 MWp Power Pant Location: Ayutthaya, Thaiand Project Area: 69,000 m² Expected Annua Output: 4,463 MWh/year System Type: Fixed Decentraized System Modue Type: Thin Fim - 40,075 Modues Construction Period: 1st Phase: 3 months 2nd Phase: 5 months EPC Contractor: Annex Power (Thaiand) One of the argest commercia PV power pants currenty under construction in SEA 24

25 Project Name: Thaiand MWp Power Pant Location: Lopburi, Thaiand Size: MWp Project Area: 43,000 m² Expected Annua Output: 3,500 MWh/year System Type: Fixed Decentraized System Modue Type: Poycrystaine -10,800 Modues Construction Period: 6 months Annex Power Function: EPC and O&M Year of Execution:

26 Project Name: Thaiand 3.85 MWp Power Pant Location: Nakhon Prathom, Thaiand Size: 3.85 MWp Project Area: 56,000 m² Expected Annua Output: 5,600 MWh/year System Type: Fixed Decentraized System Modue Type: Poycrystaine - 16,240 Modues Construction Period: 4 months Annex Power Function: EPC and O&M Year of Execution: 2012 One of the argest commercia PV power pants currenty under construction in SEA 26

27 Project Name: Thaiand 9 MWp Power Pant Location: Nakhon Prathom, Thaiand Size: 9 MWp Project Area: 128,000 m² Expected Annua Output: 13,927 MWh/year System Type: Fixed Decentraized System Modue Type: Poycrystaine 40,000 Modues Construction Period: 6 months Annex Power Function: EPC and O&M Year of Execution: 2012 One of the argest commercia PV power pants currenty under construction in SEA 27

28 Project Name: Thaiand MWp Power Pant II Location: Lopburi, Thaiand Size: MWp Project Area: 43,000 m² Expected Annua Output: 3,500 MWh/year System Type: Fixed Decentraized System Modue Type: Poycrystaine -10,800 Modues Construction Period: 6 months Annex Power Function: EPC and O&M Year of Execution:

29 Project Name: Thaiand 1.2 MWp Power Pant Location: Khon Kaen, Thaiand Size: 1.2 MWp Project Area: 17,750 m² Expected Annua Output: 1,920 MWh/year System Type: Fixed Decentraized System Under Construction Modue Type: Thin Fim 12,964 Modues Construction Period: 4 months Annex Power Function: EPC and O&M Year of Execution: Mid

30 YOUR RENEWABLE ENERGY PARTNER IN SOUTH EAST ASIA For additiona information pease contact Mr. Danie Gaefke at or via teephone: +66 (0)