Accelerating the Integration of Renewables

Transcription

1 GE Power & Water Accelerating the Integration of Renewables Lorenzo Stocchino August 31, 2010

2 Agenda 1. Introduction- GE Energy 2. GE s Renewable Portfolio 3. Developing Renewables- (Wind example) 4. GE GDSI 5. GDSI Case Study South Africa Best practice 6. Q&A 2 /

3 GE s portfolio 4 businesses operating in more than 100 countries 130+ years Over 320,000 employees worldwide 2009 revenue $157B, earnings $11,2B Energy Infrastructure Technology Infrastructure GE Capital NBC Universal Power & Water Energy Services Oil & Gas Aviation Enterprise Solutions Healthcare Transportation Aviation Financial Services Commercial Finance Energy Financial Services GE Money Treasury Cable Film International Network Sports & Olympics 3 /

4 GE Power & Water portfolio Diverse technologies totaling $21 billion revenue in 09 Gas Turbines Steam Biogas Wind Nuclear Cleaner Coal Water Solar Renewable Energy Renewables building on power generation technology & expertise 2010 General Electric Company. 4 / 4

5 Renewable Energy Portfolio 1.5MW Series 2.5MW Series Offshore Services Solar Capacity factor leadership 98% availability Expanding MMW reach Advanced load controls Reliable direct-drive Increased output & rotor dimension Performance upgrades Asset life management Thin film technology Inverters & utility scale systems Grid Integration Leadership Plant Optimization System Wide Monitoring and Control $1.5B invested in technology 2009 General Electric Company. 5 / 5

6 GE s renewable portfolio Wind Solar Leading N. American wind turbine supplier World s most reliable 98% availability 13, MW installed globally Thin film technology Grid friendly Inverters Utility scale solutions Biogas Power range: 0.25 MW-4 MW Fuel flexibility: Biogas or a variety of renewable alternative gases Geothermal Power Range 5-70MW >8000MW in 22 Countries Opportunity for diversification GE Company Proprietary 6/

7 Renewable Energy in Africa

8 A snap shot Opportunities... Large & diverse resource Powering Off Grid Cleaner environment Alternative land use Improved market access Challenges Enablers Legislation (FITs & REN targets) Partnerships Access to financing Streamlined permitting Grid Access Infrastructure Capital Development experience 8 /

9 How do we get from here; To here? TO 9 /

10 By developing; a project that is sustainable environmentally & socially technically economically for energy buyer (COE) for investor (ROE / IRR) financially lenders (DSCR) Sustainability = risk management 10 /

11 Developers need to bring together: Developer/ Investor Lenders Invst agmt Loan agmt Planners Bld prmt PPA Utility Land owner Land agmt IPP Wind Plant EPC O&M agmt Operator Carbon developer ERPA WTG, BOP vendors Key party Key agmt ERPA Emission reduction purchase Agreement 11 /

12 Wind power project life time risk profile Risk Profile (p) High Declining Low Customer Shared GE Money at risk (US$) development risk construction risk PPA risk wind risk turbine risk WTG warranty Development Construction Debt Period 12 years 12 /

13 Development risk can sometimes be shared Risk Profile (p) Medium high Declining Low Customer Shared GE Money at risk (US$) development risk construction risk PPA risk wind risk turbine risk WTG warranty Development Construction Debt Period 12 years 13 /

14 Risk management What can GE offer? In selected cases, GE participates in the development consortium with; financial support technical expertise grid studies wind resource assessment carbon monetisation GE can structure a deal to best fit the needs of the customer/partner 14 /

15 Global Development & Strategic Initiatives Project Financing Joint Venturing Strategic Analysis & Support CMC Sales Finance GDSI Legal Marketing EHS New Product Launches Project Development Site Acquisition Deal Structuring GDSI are part of a wider team 15 /

16 GDSI Value üge Relationship- Leveraging GE capabilities for the benefit of our customers enhanced relationship with GE ü People- 40 people globally with expertise in development, deal structuring, and finance ü Products- Diverse energy solutions: thermal, wind, solar PV, Jenbacher engines ü Technical Expertise- Access to world class technical support group and research center ü Access to partners- Strong relationships with project developers and utilities ü Knowledge- Project development expertise to support key projects 16 /

17 GDSI roles Specific examples include: Project feasibility studies Economic modeling Permitting Regulatory initiatives Community relations Transmission studies Land resources Financial start-up support Facilitating/arranging debt & equity placement Carbon monetization Project sell down 17 /

18 Project Development Timeline Development Greenfield development Project definition Feasibility studies (technical, economic, financial) Site selection & acquisition Permitting & licensing 2-5 years GDSI Core development Commercial structuring Contract negotiation Grid connect Fuel supply Power off-take EPC Finance Financial structuring & credit evaluation Construction Financial structuring Financial engineering Debt & equity arrangement Develop or co-develop opportunistically Development financing MIP and GIP Funds 1-2 years 20+ years Minority investment in international developers with a strong deal pipeline Operation GE Capital Markets GE Energy Financial Services Post COD Ownership & asset management 18 /

19 Typical GDSI Model Development Phase Construction Phase O&M Phase Fully developed Project Construction Start Project Initiation Financial Close COD ERPA Emission reduction purchase Agreement 19 /

20 Typical GDSI Model Development Phase Construction Phase O&M Phase Fully developed Project Construction Start GDSI Project Initiation Financial Close COD GDSI GDSI Exit/ Exit ERPA Emission reduction purchase Agreement 20 /

21 Typical GDSI Model Development Phase Construction Phase O&M Phase Fully developed Project Construction Start GDSI Project Initiation Financial Close COD GDSI Partially Exit GDSI Exit ERPA Emission reduction purchase Agreement 21 /

22 Potential Deal Structures GE can structure a deal to best fit the needs of the customer/partner: Simple Complex Sale Agreement Assigning asset (Land, PPA, Grid) in exchange for a lump sum payment Developer Option Agreement Limited development support Success fee upon exercise of option Joint Development Agreement (JDA) Detailed contract outlining roles & responsibilities, decision making, etc GE equity stake Structure flexibility to meet customer needs 22 /

23 South Africa A case study Market Overview SA is new market identified as GDSI target SA generates 2/3 of Africa s electricity Installed capacity of 45GW, mostly coal Increasing gap between supply and demand 2GW/y for next 20y Drivers for GE participation 1. High CO2 footprint 2. High energy demand growth 3. Short term risk of supply interruption GE halo effect / Skin in the game 5. Technical knowledge and Funding 2008 REN Policy debate March 2009 FIT approved 2010 REN Policy improvements debate with stakeholders target 4Q 10 June 08 GDSI Africa Pole Leader appointed May 09 GTZ workshop Cape Town June 09 1 st partner onboard 3Q 2011 Nov 09 1y wind data GE Dev Day Add l JDAs in negotiation Aug 2010 Strong GDSI pipeline under development 23 /

24 GDSI When a piece is missing Finance Expertise development technical project finance carbon monetization Name credibility Project site Global perspective network 24 /

25 Project Development Experience Project Country Plant Type MWs Arklow Ireland 7x3.6MW Offshore wind 25 Gunfleet Sands UK 30x3.6MW Offshore wind 108 Cefn Croes UK 39x1.5MW Onshore wind 59 Tappaghan UK 13x1.5MW Onshore wind 20 Griffin UK 61x2.5, 8x1.5MW Onshore wind 165 Ally France 26x1.5MW Onshore wind 39 Cham de Cham Longe France 12x1.5MW Onshore wind 18 La Navica & Dehesica Spain 29 x 1.5MW Onshore wind 59 Baglan Bay UK 109H Gas CC 500 Atlantic US 107FA Gas CC 250 Westbrook US 207FA Gas CC 520 Dell US 207FA Gas CC 520 McAdams US 207FA Gas CC 520 Towantic US 207FA Gas CC 520 Samalayuca Mexico 3x107FA Gas CC 700 Uch Pakistan 309E Gas CC 560 Paiton Indonesia 2x660 ST Pulverized Coal 1320 Selective examples of GDSI projects 25 /

26 Investment & partnership: GE to Government (PPP): ünew project development with GDSI üstrategic partnerships: EPC s, Developers, Distributors, VARs, Installers üemployment: training and skills transfer üdirect business with power utilities: Wind, Solar, Waste 2 Power, Geothermal ü Advisor role on technology and funding üsupply Chain: promote local content üafter sales Service: Repairs and Maintenance 26 /

27 Thank You George Njenga Tel Johannes Cilliers Lorenzo Stocchino