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HYBRID PHOTO-VOLTAIC/DIESEL GENERATION OPPORTUNITY page 1 of 2
Investment: USD 90 million Funding Period: 5 years
Description: Five hybrid solar/diesel power generation installations,
(one per year for five years) each comprised of 5 MW
of solar photovoltaic panels and 7.5 MW of diesel generators.
Location: States of Para and Rondonia - Northern Brazil
Investment Highlights
Government Support
The Brazilian Government supports installation of electric
generation facilities in remote areas through a cash
rebate (paid over a maximum period of six years)
equal to up to 75% of capital costs.
Projects Required to Replace
Obsolete Installations:
Current installed diesel generation capacity in many remote areas is old and inefficient and requires replacement.
High Technical Efficiency:
Northern Brazil has one of the highest levels of solar
power insolation rates (up to 3.3 kwh/year per watt of
installed capacity) in the world.
Strong Project Team:
Project team includes former Regional Director of the
Brazilian Electric Power Regulatory Authority ("ANEEL").
Sales Secured by Long Term Contract:
Each project would sell power under a long term fixed price contract.
Key Investment Parameters
Solar Diesel Total
1. Generation Capacity per Project (MW) 5 7.5 12.5
2. Number of Projects 5 (1/year for 5 years)
3. Capital Investment (USD millions) Per MW Solar Per Project Total
Solar Panels 2.8 14.0 70.0
Diesel Generators 0.6 3.0 15.0
Development Costs 1.0 5.0
Total Investment 3.4 18.0 90.0
4. Partnership Parameters
Sponsors Investors Total
Share of Operating Cash Flow 30% 70% 100%
Share of Investment and Rebate 100% 100%
HYBRID PHOTO-VOLTAIC/DIESEL GENERATION OPPORTUNITY page 2 of 2
Investor Annual Investment and Net Cash Flow (USD millions)
Cash
Investment Operating Total
Year Investment Rebate Cash Flow Cash Flow
2013 (18) 0 0 -18
2014 (18) 2 2 -14
2015 (18) 5 4 -9
2016 (18) 7 6 -5
2017 (18) 9 8 0
2018 0 12 10 22
2019 0 12 11 23
2020 0 9 11 21
2021 0 7 12 19
2022 0 5 13 17
2023 0 2 13 15
2024 0 0 14 14
2025 0 0 14 14
2026 0 0 15 15
2027 0 0 16 16
2028 0 0 16 16
Total (90) 70 166 146
Investor Financial Returns
Investment: USD 90 million
[email protected]%: USD 12 million
IRR (%) 20%
(unleveraged)
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