Case Studies of 567KW Rooftop Solar PV in ADB’s HQ and NED’s 73MW Solar Farm in Thailand

Walk the Talk

Aiming Zhou Energy Specialist Regional and Sustainable Development Department

Bangladesh Solar Development Forum 20, September Dhaka

Content
ADB’s Current Clean Energy Investment Examples of Solar Project Financing by ADB ADB’s Rooftop Solar Project in 2011 Thailand 73MW Solar Project in 2010 Conclusions

ADB Low-Carbon Programs and Initiatives
Clean Energy Program
Asia Solar Energy Initiative Quantum Leap in Wind Energy for All Promoting Carbon Capture and Storage Asia Climate Change and Clean Energy Venture Capital Initiative

Carbon Market Program – TSF, APCF, FCF Sustainable Transport Initiative

ADB’s Composition of CE Financing
(Cumulative 2008‐2010, in US$ million)

Hydro 1,554 54%

Wind 676 23%

Solar Others 206 7% 459 16%

Total Energy-related Investment (2008-2010): $ 9.1 Billion Total Clean Energy Investment (2008-2010): $ 4.8 Billion.
Note: “Others” in the breakdown of RE projects pertains to biomass/biogas, waste to energy

Why Solar Energy
In 2010, $100 billion (approximately 5%) of global retail electricity demand could be competitively addressed with solar power… ~600 GWs ($2 Trillion of Solar)
1000000 # of MWh sold at each price point 100000

Area of solar competitiveness 2020 2015 Solar Electricity Price Declining 2010

10000
MWh

1000

100

Conventional Electricity Price Rising

10

1
>27 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 2 3 4 5 6 7 8 9

US Cents per kWh

Source: Jigar Shah, 2011

Approaches for Solar Project Financing
Bankable Solar Projects • PPA • System Lease • Contractual Intermediary • Utility Owned • User Owned • Others

2011 ADB’s 567kW Rooftop Solar Project at Headquaters

Purposes of ADB 567 kWp Rooftop Solar Project
1. Greening ADB Building Operations Energy Efficiency (chillers, lighting etc.) Solar Power Supply to ADB Headquarter Bldg Others

Purposes of ADB 567 kWp Rooftop Solar Project (continued)
2. Technology Demonstration 3. Business Model, build-operate-transfer with PPA

ADB
PPA
Power

• Portion of Facility Building rooftop is leased for 15 years at $1/sq meter, total estimated area size is 5,166 sq meter • Solar power is sold to ADB at the rate decided by the bidding • Financing (commercial financiers) • Construction (567 kWp) • Operation (~ 600 MWh per year) • Transfer (buyout option within 15 years and free at year 16)

Suntech/Propmech Consortium
Loan Repayment

Business Financing

Commercial Financier

ADB Headquarters Complex

Details of Procurement Process
1. Pre Bidding Screening and clearance of legal, technical and commercial aspects for the project within Manila Jurisdiction Internal process for project development and approval by ADB Management 2. Bidding Process The Bidding Process: Conception pre- qualification criteria Draft technical and legal specification document Invitation to bid to qualified bidders (July, 2010) Selection of contractor / PPA signed 3. Project Development Construction (5-6 months) Trial operation and normal operation (December, 2011 – February , 2012)

Diagram of ADB Rooftop Solar System
567 kWp Rooftop PV System Meralco 34.5KV/380Y/200V

Inverters

Switch 600MWh/yr

Busbar

ADB Substations 18,300 MWh/yr ADB Headquaters Compus

The solar system supplies about 3% of the electricity consumption in ADB’s complex

ADB Rooftop Solar Project Visual Impact

Highlights
No upfront cost to ADB
The business model uses a PPA between the Suntech/Propmech Consortium (Project Implementer) and ADB (End User), whereby the project implementers bear the investment cost and O&M costs and user purchase the electricity at bid price.

ADB’s credit worthiness helps the consortium secure non-recourse loan financing
PPA will help the project implementers to secure financing from local commercial financiers. With a 15-year PPA from ADB, this project becomes a bankable project

Challenges to replication
Challenges could arise in countries that have regulated and partially deregulated electricity markets. This model needs permission for third party-owned systems to sell to end users

2010 ADB Funded Project in Thailand:NED Solar Power Project

Project Features
• • • • •
73 megawatt (gross) in Lopburi Province, Central Thailand. Thin-film Thailand’s first large, utility-scale solar generating facility. 5-year automatically renewable PPA between with Electricity Generating Authority of Thailand (EGAT) under the Small Power Producers Program. Multi-Sponsors: CLP Group, Mitsubishi, and the Electricity Generating Public Company.

Contractual Structure

17

Highlights
ADB loan
Thai Baht-denominated loan for $63 million equivalent (25% of project cost) 18 years tenor, back-ended equity injection, non-recourse project financing Attractive fixed rate in Thai Baht covering all disbursements and locked-in over the entire 18 years tenor

ADB grant
$2 million grant from ADB’s Clean Energy Financing Partnership Facility to cover any contingency costs arising from the use of highly complex, innovative thin film PV technology on a large scale.

ADB Clean Energy Financing toward  $2 Billion  by 2013 Go Solar

Source: ADB Database

Thank You !

Contact: azhou@adb.org

More information:  www.adb.org/clean‐energy

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