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Africa GreenCo

by

Laura C

on 7 September 2016

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Transcript of Africa GreenCo

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Governments lack the resources, the expertise and the efficiency to achieve this on their own.
MOVE AND MEASURE
to discuss the health-related physical components
the benefits of physical activity and exercise
the current recommendations, and
to design your own 30 minute "Game Plan"
TO DISCUSS THE BETTER
SMART
GOAL-SETTING
The vehicle to be set up as a PPP between national utilities, development finance institutions (DFIs) and private investors, with a management team with IPP negotiating experience.
THANK YOU
Africa GreenCo does not own any of the grid, or seek to replace existing monopolies – and it would be used as a vehicle for large scale projects only (i.e. those that require more than one offtaker)
TO ORGANIZE A BETTER "SLEEP HYGIENE"
TO DESIGN YOUR OWN 10 MINUTE "RECOVERY"
Scale of Problem and Sustainable Energy for All
This reality = our support for the Sustainable Energy for All, a global initiative calling for:
1. providing universal access to modern energy services
2. doubling the global rate of improvement in energy efficiency and
3. doubling the share of renewable energy in the global energy mix
Energy = alleviation of poverty, promotion of economic development, improvement of quality of life and progress in health, education, job creation and gender equality.
SE4All goals = not possible without scaling up private investments
SE4All objective is ambitious = trebling annual investment in renewables to
$1.2 trillion
, to double generation by 2030.
Renewable Energy Potential
Hydro Potential is estimated around 1,750 TWh
Geo-thermal energy is estimated at 9,000 MW
Solar has more than 11 terawatts of potential capacity
Onshore wind can deliver about 109 gigawatts of capacity
Challenges for the Private Sector
The creditworthiness of off takers
The lack of supply and size of high quality bankable deals
The lack of necessary expertise and knowledge in developing IPPs
Africa GreenCo as one potential solution
Africa GreenCo as a Public-Private Partnership
Africa GreenCo’s Main Function
To offtake and catalyse the development of regional renewable energy projects by acting as a single entity to enter into PPAs for the bulk of the power with IPPs on the one side and long term sales arrangements and bilateral trades with national utilities on the other.
With PPA risk mitigated, and an intermediate and creditworthy buyer of power in place, Africa GreenCo enhances the potential of new projects to achieve financial close.
Under such conditions, a far larger quantity of international investors and lenders would deploy capital to renewable energy projects in the region, at a lower required hurdle rate for invested capital.
This would help with:
1. Progress towards achievement of cost-reflective tariffs
2. Better project preparation capacity
3. Reduced cost of capital for IPPs with consequent decrease in required tariffs
4. An increase in national utility creditworthiness
5. Movement towards a more adequate regional policy and regulatory frameworks and regional power trade
Potentially Applicable Projects
(amongst others)
1. Inga 3 BC (4,800MW) Hydro

2. Batoka Gorge (1600 MW) Hydro

3. Ruzizi 3 and/or 4 (145MW) and (287MW) Hydro

4. Baringo Silali (2000 MW Geothermal) and other geothermal projects in Kenya

5. Mano River Union Generation Projects

6. Ethiopian Geothermal projects
Africa GreenCo’s Transaction Schematic
Africa GreenCo’s Revenue Streams
1. A transaction margin between PPA and PSA on projects
(will start only once project is finalised and electricity starts flowing)
2. Return on any investment into the underlying IPP
3. Return on required upfront cash injection – requirement to achieve creditworthiness
4. Monatising Carbon Credits
Main barriers to implementation
• Clear political approval to be obtained

• Substantial funding and interest required from DFIs

• Underdeveloped transmission and interconnection networks and tie lines

• Lack of sophisticated legal framework for trading

• Lack of clear wheeling rules and rules for access to the transmission grid

• Difficulty aligning national and regional investment decisions

• Differences in regulatory environments between countries

• Insufficient institutions with independent regulatory

• Slow progress towards achievement of cost reflective tariffs

• Poor project preparation capacity

• Challenges of ownership and accountability for regional programmes

• Lack of renewable energy zoning and resource mapping in the region.
Benefits of the Africa GreenCo approach
Catalyse development of large regional scale renewable energy
Promote exchange of power with neighbouring countries
Help develop a more integrated regional power market
Help achieve scale
Reducing risk for IPPs and attracting private sector finance
Increasing the entry of turnkey contractors into the region and competition between works contractors
Africa GreenCo could lead development of off-grid renewable energy for the region acting as an aggregating vehicle for off-grid
Better health outcomes and substantial reduction in carbon emissions deployment of renewables
Incremental job creation and better public access to energy 
(i.e. the achievement SE4All goals)
Regional power planning leading to substantial reduction of costs and saving up US$47.5bn over 20 years
Decrease in standby capacity investments
Countries encouraged and enabled to move towards cost- reflective
Africa GreenCo’s Supporters

The Right Honourable Andrew Mitchell MP
Former UK Secretary of State for International Development

Anne Baldock
To 2012 Global Head Energy & Infrastructure Allen & Overy, Non-Exec Director Low Carbon Contracts Company

Arthur Smith
President-Elect, National Council for Public-Private Partnerships Chair and U.S. representative to the United Nations Economic Commission for Europe (UNECE)’s Team of Specialists on Public-Private Partnerships

Crispin Holliday
Commercial Director at Aldwych International Ltd

David L. Massie
Chairman & Chief Executive Oficer IAF Capital

David Munene Mwangi
David Munene Mwangi, is an Energy Consultant who took voluntary early retirement in August 2010 from the
Kenya Power and Lighting Company Limited (KPLC), where he had worked for 32 years. David’s current and former clients include US AID, KfW, IFC, the World Bank, Re-Consult of Turkey, Tata Power Company of India and two private Kenyan companies developing power plants in the country - Gulf Energy and Lake Turkana Wind Power Company.

Geoffrey Hamilton
Head of the Public-Private Partnership programme at the UNECE

Helena McLeod
Head of KPMG (IDAS) Renewable Energy and Climate Change Portfolio

Jose Maria Nacarino Mejias
Senior Project Manager, International Projects Department, Africa Division, ACCIONA

Kaushik Ray
Partner, Trinity International LLP

Sir Malcolm Bruce MP
To March 2015 Chair of UK International Development Select Committee

Penny Herbst
Penny has more than 30 years’ experience across numerous transactions working in senior treasury, inance and renewable energy roles at ESKOM. In this time she held sole responsibility for structuring, negotiating and clos-ing several large multilateral facilities totalling over $7 billion for ESKOM and South Africa.

Rene T. Meyer
Consultant at NORPLAN/KfW/Get-Fit (Uganda)

Ryan Anderson
Head of Renewable Energy advisory services at Multiconsult/NORPLAN

Steve McCauley
Executive Leadership Coach

For more information please visit www.africagreenco.com
or email Ana at ana.hajduka@africagreenco.com
The Problem in Sub-Saharan Africa
SSA is suffering from a sustained and chronic power crisis.

31 percent of its population has access to electricity = nearly 600 million people without energy access.

The combined power generation capacity of SSA, excluding South Africa, is only 28 GW equivalent to the installed capacity of Argentina.
But via Public-Private Partnerships we can help leverage the required private sector capital.
Africa GreenCo calls for the set up of a public-private partnership in the form of a Green Regional, Energy: Efficient, New and Creditworthy Offtaker - one method of leveraging private capital for large scale regional renewable energy projects.

Africa GreenCo was endorsed and included as a recommendation in the SE4All Finance Committee Report.
Prezi Presentation - Laura Chivu
laura.c.chivu@gmail.com
Calling for the set up of a PPP in the form of a Green Regional, Energy: Efficient, New and Creditworthy Offtaker in order to:
1 = streamline development

2 = mitigate offtake and credit risk

3 = catalyse private sector finance for large-scale regional renewable energy projects
Full transcript