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Rwanda 8.5 MW project - the
first utility-scale solar plant in
East Africa12 months from PPA to
Interconnection -
the quickest power project ever in
Africa?
Joint presentation by:
Lead investor EPC, O&M Developer
Introduction to GWG
Gigawatt Global, a multi-national renewable energy company, is a leading frontier solar developer which developed the first utility-scale solar field in East Africa.
Page 2
A solar IPP with an integrated business model
Equipment
manufacturing
Scatec Solar
Project
developmentFinancing Construction Operations
Ownership
(IPP)
• Long-term
ownership
• Investment
JV with
• Performance
• Maintenance
and repair
• Project
management
• Construction
monitoring
• Equity and
debt
structuring
• Own
development
• Local
partners
• Funding of
developers
Attractive for developers: •Take 100% equity requirements together with Norfund •Bring all required debt financing•Do full EPC, O&M and asset management
INTRODUCTION TO SCATEC SOLAR
A strong position in emerging markets
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Established 2001
Main offices
Norway Oslo
South Africa Cape Town
United States San Francisco
Market Cap ~ 400 MUSD
Operational Power Plants
Czech Republic 20 MW
Kalkbult, RSA 75 MW
Linde, RSA 40 MW
Dreunberg, RSA 75 MW
ASYV, Rwanda 9 MW
Plants under construction
Jordan 43 MW
Red Hills, Utah 100 MW
Honduras 60 MW
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INTRODUCTION TO SCATEC SOLAR
• 430 MW in operation / under construction
• 310 MW in emerging markets
copyright: Scatec Solar Solutions GmbH
www.scatecsolar.com • [email protected]
The opportunity – SSA is finally starting to add MWs
5
Generation
capacity in SSA
Power
investment by
source
Source: Research by Anton Eberhard
Most Chinese
projects are
large hydro
Thermal +
renewable
Solar power is a potential game changer for Africa
“I’d put my money on the sun and solar energy.
What a source of power! I hope we don’t have to
wait until oil and coal run out before we tackle
that.”
Thomas Edison, 1931
Why solar power?
•Solar is cost competitive: Cheaper than new-build coal in
South Africa
•Simpler and faster to build than any other source – 9
months for 75 MW Kalkbut
•Scalable and flexible technology – rooftop to large-
scale, grid to off-grid
•Clean and sustainable
Why solar power?
•Solar is cost competitive: Cheaper than new-build coal in
South Africa
•Simpler and faster to build than any other source – 9
months for 75 MW Kalkbut
•Scalable and flexible technology – rooftop to large-
scale, grid to off-grid
•Clean and sustainable
Rwanda overview
Significant reforms in the 2000s to enable private investment
•52 / 185 in World Bank “Doing Business” report
•Corruption Index (Transparency International): 49/183
•Net FDI inflows from 8 to 110 MUSD in 2000 to 2013 (~ 15x)
•Real GDP growth 8% 2001 - 2013
•Poverty rate from 59% in 2001 to 45% in 2011
Energy facts when development was initiated
•Population of 11+ million
•Installed capacity: 110 MW
•15% of population with grid access
•40% of capacity is diesel
•Targeted capacity by June 2018: 563 MW
•Existing IPP framework + 1 prior energy deal negotiated
Project overview
Page 8
• Location: 60 km outside Kigali,
on Agahozo-Shalom Youth
Village land
• Capacity: 8.5 MWp, increased
grid capacity by 6%
• Annual generation: 15.5 GWh
• Technology:
• Polycrystalline modules
(BYD from China)
• Single-axis trackers
(Ideematec from
Germany)
• SMA inverters from
Germany
• PPA details: 25 years
• Total project cost: 23.7 MUSD
• Location: 60 km outside Kigali,
on Agahozo-Shalom Youth
Village land
• Capacity: 8.5 MWp, increased
grid capacity by 6%
• Annual generation: 15.5 GWh
• Technology:
• Polycrystalline modules
(BYD from China)
• Single-axis trackers
(Ideematec from
Germany)
• SMA inverters from
Germany
• PPA details: 25 years
• Total project cost: 23.7 MUSD
Developer Lead investor
• Aug 2013: Start of DD Process
with potential lenders
• Aug 2013: EPC tender
• Oct 2013: Active engagement
with Norfund / Scatec
• Nov 2013: Scatec EPC offer; in-
principle agreement between
parties
• Nov 2013: Mandating of FMO
and EAIF as lenders
• Dec / Jan 2014: Final agreement
between GWG, Scatec and
Norfund
• 14 Feb 2014: Financial close
• Mar 2012: Partnership w / ASYV
• Apr 2012: EOI
• Jun 2012: First engineering visit
• Nov 2012: MOU with GoR
• Dec 2012: EIA, initial design and
Grid Study completed
• Jan 2013: Feasibility and EIA
studies approved
• Feb - July 2013: PPA
negotiations with EWSA
• July 2013: PPA signed
<<<<<<<<<<<<<
12 months from PPA to Interconnection
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Project development Financing Construction Operations
• Dec 2013 – Feb 2014: Negotiations with
sub-suppliers
• Feb 2014: Site mobilization
• Mar 2014: Site preparation completed
• Apr – May 2014: Project slow down
• Jun – Jul 2014: Installation of trackers,
modules and electrical work
• 26 Jul 2014: Interconnection
• Aug 2014: Testing and Commissioning
• Sep 2014: Formal Operation Date
July 2013 – PPA Feb 2014 – Financial Close July 2014 – Interconnection
Summary of success factors
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• Strong local partner
• GoR a strong customer: Tight timeline, but committed to avoiding
delays and strong negotiators
• Strong legal representation– Norton Rose Fulbright
• Existing IPP framework
• Permits in good order – IFC performance standards
• From PPA to Financial Close, parallel negations but prioritization of
speed
• Debt providers (FMO/EAIF) had already worked together
• Strong equity consortium (Scatec / Norfund) which had worked
together and with track-record in Africa
• Integrated offering of Equity + EPC + O&M
• Taxes: Critical to get it right
• Grants for pre-development (OPIC / Power Africa and EEP)
Recommendations for future large-scale grid connected solar deployment
• Standard and bankable contractual documents
• Experienced local and international advisers
• Strong dialogue with lenders
• Direct negotiations - critical to define criteria and evaluate “value for money”
• Feed-In-Tariffs – hard to get the tariff right
• Tender programs – more complex but most relevant to achieve scale
• Leverage international efforts like IFC «Scaling Solar» and Uganda «GET FIT»
• Long-term plan with clear targets
• Continuity in program vs one-off projects
• Land constraints need to be overcome
• Clear understanding of the grid required (e.g. grid issues South Africa)
• Grant funding in early stage development
Develop bankable
framework
Develop bankable
framework
Carefully
consider
procurement
approach
Carefully
consider
procurement
approach
Create scale and
predictability
Create scale and
predictability
Other Other
Contacts
Andrzej Golebiowski
Vice President Business Development
Country Manager South Africa
Mobile: + 27 79 606 0225 (ZA) / + 47 45 21 49 04 (NO)
Page 12
Chaim Motzen
Managing Director and Co-Founder
Mobile: + 972 52 352 90 87
