Lieberose Solar Park_Presentation-Worked (2)

8/12/2019 Lieberose Solar Park_Presentation-Worked (2)

1/43

JUNE3, 20

PRESENTED

GROUP1

LIEBEROSE SOLAR PARK FINANCANALYSIS


2/43

Problem Statement

Solution Scope of Liberose Solar Park Project Background Liberose Construction Flow Site Details & Optimal Installations of Solar Panel Creating a Financing Plan

Investors involved Cash flow/ Future Worth AnalysisAlternative Financing Solution

Future Advancement/ Deconstructioning Conclusion

Agenda


3/43


4/43

Problem Statement

Climate change symptoms are

becoming more harmful to thecurrent way of life causing for aneed of action.

Efficiency and sustainability ofcurrent living styles are consideredfor combating climate change.

However, even with their increase,fossil fuel energy generation willcontinue to put out overwhelmingamounts of CO2.


5/43

Solution

The best solution renewable and sustainableway of generating energy, clean energy.

Wind farms and solar parks, both solarthermal and photovoltaic technologies, have

been popping up all over the world in thelast few decades.

While these energy sources are notconsistent, modern methods make theseparks highly competitive in todays energymarket.


6/43

Solution

These parks have been making huge

impacts on clean energy consumption.Many countries and companies arepushing for worldwide clean energyand one of the world leaders isGermany.

Germany has over 120 solar parks

with the second largest solar park inthe world, Lieberose (Love Rose).


7/43


8/43

Provides clean energy to over 15,000

homes. Land burdened with munitions being

re-naturalized. Outputs 53 MW or 53 million

kWh/year. Takes up 162 hectares of land, the

equivalent of 400 acres. It was designed to come online in the

year 2009 and last for more than 20years.

Scope of Liberose Solar Park Project


9/43

Around 35,000 tons of CO2are savedfrom entering the atmosphere annually.

Awarded official partner of theSustainable Europe Campaign by the

European Commission.

Scope of Liberose Solar Park Project


10/43

Background

Germany has been using

renewable energy technologiessince 1990.

It has about 13 million squaremeters of roofs and fields coveredwith solar panels and more than21,300 wind turbines.


11/43

Major Project Developers

Juwi Group

Founded in 1996 by Fred Jung andMatthias Willenbacher in Germany.

Juwi has implemented over 2,300plants which produce a combined totalof approximately 3,000 MW of power.

First Solar Worldwide, it provides more than 8 G

power.

It is also a financer, engineer, construand operator of many of the worlds lplants.


12/43

Major Project Developers

Major projects Juwi has led in development


13/43


14/43

Construction

The construction ofLieberose SolarPark planned totake place betweenJanuary andDecember in 2009.

The project endedup being completedand commissionedin October of 2009.


15/43

Construction

Early stages of construction of the project included clearing and

preparing the land from previous military use. Dangerous ammunitionswere removed from the park as part of the clearing process.


16/43

The mounting systems for the panels weremanufactured by Schletter GmbH.

Each mount holds 25 panels and costsaround $1000 USD. Therefore a total of14,000 mounts are needed for the700,000 panels, creating a total cost of$14,000,000 USD.

Next, around 700,000 PV thin film

modules, predominantly supplied by thenearby German subsidiary of marketleader First Solar in Frankfurt/Oder, wereinstalled.

Installation of equipments


17/43

The modules supplied by First Solar, FS-272-277modules, had an approximate cost of $150 USD per

module.

Installation of equipments

There were also 37 SMA inverters rated aone rated at 900MV installed. Though thnot specifically listed it is determined thabetween $100,000 to $200,000 USD per


18/43

The company Leoni, equipped the sinstalled pipes that transport the ge700,000 solar modules to the inver

More than 1000 km of sophisticatein total.

The management of Leoni reports textremely weather resistant and halife of at least 150,000 hours of opeof more allowed than 30 years.

The BETAflam solar cable is doublehalogen-free, with a highest resistaretardant, UV, ozone, hydrolysis as

withstand temperatures from -40 t

It is also the first cable that is univethe installation of photovoltaic syst

America, as it is both approved by TAmerican UL (Underwriters Labor

Installation of Equipments


19/43

An aerial view of Lieberose solar park


20/43

The Operation of a PV System

Photovoltaic systems are a form of energygeneration that converts sunlight into electricity.

The material used in PV cells is crystalline-silicon.When light hits the material it releases electronsthat are collected at the metal conductors along eachcell.

These electrons then flow through the conductors tothe outputs. The output of the solar panels are nottypically connected directly to a load. Instead the

solar panels are either directly connected to aDC/AC inverter or to a charge controller and abattery which is then connected to the inverter.

Photovoltaic systems can be used in many differentapplications.


21/43

Installations of Solar Panel for Optimal Perfor

The orientation of the solar panels isimportant for getting optimal performanceand energy output. Some applicationsallow for the panels to vary or track thesun throughout the day while others arefixed in place.


22/43

Lieberose solar park is located in ameadow on top of the old militaryfacilities.

While solar tracking causes for higherefficiency in the photovoltaic panels itcosts money and energy. For Lieberose the

benefits do not outweigh the costs when it

comes to solar tracking. Therefore thepanels at the solar park are fixed in placefacing south at around a 23 degree angle.

Installations of Solar Panel for Optimal Perfor


23/43


24/43

Creating a Financing Plan

Juwi and First Solar implemented a financing plan that takes outside capital andthrough two development banks.

The outside capital accounts for 80% of the total investment and was received frobanks: KfW IPEX Bank (provided 1/3 of the volume), Bremer Landesbank, DZ BaHessen-Thringen (provided 1/5 of the volume), and NordLB.

The long-term financing includes funds from the promotional programs of the EuInvestment Bank and KfW Bankengruppe.

The remaining 20% of the capital was equity, financed by the developers Juwi Gr

Solar at first through mezzanine loans (this allow the lender to take hold of stockproject or company if the loan is not paid back in time).

The total investment volume was more than EUR 160 million -around $215millitransaction implies a deal value of $4.06 million per MW of installed capacity.


25/43

Upon completion, the park was sold to WealthCap -subsidiary ofUniCredit bank- in 2010. WealthCap launched a fund Photovoltaic1 for Lieberose solar park. Investors were allowed to participate

with min subscription EUR 10000 + 5% premium.

After the lease has run out, First Solar will take the modules backinto one of the companys recycling plants. Up to 95% of thesemiconductor material can be reused in new modules and 90% ofthe glass can be reused in new glass products. So, Lieberose will stay

sustainable after deconstruction. The waste load is reduced considerably, and thus the recycling

procedure relieves the environment.



26/43

WealthCap, the investor who purchased the Lieberose Solar Park, has provided an article VP Solar 1 that includes acash outflows & inflows with only major forms of costs and revenues were consider during calculation.

Given the feed-in tariff is $0.42/kWh and some annual costs of the park beside a few assumptions, a cash flow, breworth analysis can be done.



27/43

h fl / h l i


28/43

Cash flow/ Future Worth Analysis

Here the annual benefits (revenue) were ignored to determine what the Solar Park owners would have to pay in ordeend of the term given the annual costs, the initial investment, and salvage benefit.

Given the information from WealthCap:1. Total annual costs (M&T, lease, insurance, repair etc.. came out to be around $3,046,400.

2. An investment benefit received in year 2 for $2,448,000

3. Salvage value of $23,800,000, the present worth was calculated considering 7% interest rate.

It can be seen that the solar park needs to have an annual revenue witha present value of at least $238,985,054.72.

Based on the predicted revenue fromWealthCapsreport, the annual

benefits from Lieberose is about $22.9 million. Using more precise numbers, the annual profit PV is found to be about

$357,501.48. Meaning that the solar park is making a sizeable annualprofit.

While the profit may not seem much, the park has a FV of$14,655,949.00 at the end of 20years.Thats$14.6millio in profits!

Also it's not meant for profit but for improving the health of the landand providing clean energy.


29/43

Future Worth Analysis

This determines the value of the project in thefuture after all benefits and costs have been

paid off and accumulated at their growth rateof 7%. This analysis helps to determineproject's profitability and feasibility in thefuture. If the number comes out to be negativethen the costs outweigh the benefits and theproject will only lose money.

As can be seen, net future worth($23,019,029.44) indicates the project isprofitable.


30/43

Breakeven Analysis

This determines at what point in time the project will stopseeing only debt at the end of each year and begin seeing profit.

A straight forward calculation was done comparing the growthof benefits and costs over the time period of the project.

From graph, breakeven point occurs bet. Years 10 & 11.

These forms of analysis only consider the exchange of cash forbenefits & costs w/o any additional benefits that might exist,like the Solar Park preventing 35,000 tons of CO2 fromentering the atmosphere.

This benefit is very large equivalent to preventing 37,593,985pounds of coal being burned, or saving 28,689 acres of U.S.forest, or preventing the consumption of 81,395 barrels of oil.

These benefits on top of monetary profits in the analysis makethis project very significant and worth pursuing.

Alt ti A l i


31/43

Alternative Analysis

Another analysis on Lieberose was done by Noel Barton on a personal blog in June of 2011.

Noel determined that the peak output power, the annual power output, and the cost of power w

analyze the solar park. She was unable to find the Poutput of the solar park. So, she estimated it based on the CO2 sav

atmosphere.

Noel determined that the annual output was 52 GWhr and the peak output was 52.8 MW at a p3.03/Watt (4.12 $/Watt).

Using a Levelised Electricity Cost (LEC) calculation that assumes no inflation, no tax, fundinginterest rate with 25 year payback period, and a standard operation & maintenance of 3% cost fNoel found the results in table.

Noel considered her results reasonable whencompared to the markets of other PV solar parks.

While her assumptions are likely due to lack of info onthe analysis, they do not cover every detail that goesinto the project financing.


32/43

Alt ti A l i


33/43

While First Solar and Juwi Group decided to refinance their debt through two developmeassumed that they pay constant annuity (principal plus interests) over the 20 year life sp

more profitable ways for financing the project. A few different methods are looked at for as the input appears to be fixed.

The first method explored is charging up to EUR $0.03 (USD $0.04) additional charge foenergy sold. The next method was to have a different payment plan for the debt. Instead principal payments plus interests might it be cheaper to pay only interest until the end ofyear, or to have constant annual payments ever year. The last method was looking at filliof the equity through use of bonds instead of mezzanine loans.


Alternati e Anal sis


34/43

Additional Charge

From the cash flow analysis it was found that the annual profit that the solar pa$357,501.48 with a FV at the end of 20 years of $14,655,949.00 and an 7% inter

While the project has many other benefits maximizing the monetary value couldbeneficial. By increasing the price of energy from USD $0.43/kWh to $0.48/kW$0.03 increase) the profit margins increase greatly.

The annual profits increase to approximately USD $2,669,501.48 which is 8 timprofit. This has a future worth of USD $109,437,527.25.




35/43

Payment Plan

When paying off loans, debt, or investments there are multiple ways to tackle the large sums. sums of money gain interest over time making large numbers larger and sometimes daunting.

One ways to pay off the debt can be paying a constant principal price plus the interest accumuAnother method is to pay only the interest accumulated each year and pay off the entire capitaprojects life.

This method is not recommended as $215 million is a very large sum of money and can be difflast method looked at is paying a constant payment each year.

The total costs of these plans at the end of the 20 years can be seen in the table below.

More detailed tables can be found in the Appendix (Alternative Analysis). As clearly shown in would be paying almost $40 million less with plan 1, paying capital plus interest each year, thproposed plan. This type of technique minimizes the input into the project

Plan 1: Capital plus interest $417,251,230.92 (USD)

Plan 2: Interest only until end of period $577,177,495.22 (USD)

Plan 3: Constant payment $454,012,270.40 (USD)




36/43

Bonds vs. Mezzanine Loans

As mentioned earlier First Solar and Juwi Group had 20% of their total investment through eqloans.

These loans or investments have a set monetary value and only increase by the interest of the in which they are placed.

Bonds on the other hand often have a higher interest rate associated with them and could provmonetary value in the future, maximizing output from a similar input.

For the mezzanine loans, which are approximately (USD) $43 million there future worth is ap

million at the end of the 20 years. If bonds were purchased, assuming $3000.00 face value per bond and a total of 60,000 bond

semiannual payments and an 8% interest rate their future worth is approximately $94.5 millioyear.

Comparing the future values it is clear that the bonds value turns out to be greater.


Conclusion


37/43

Based on the analysis of the original and alternative plans the team has determined that the projebenefit from the following:

Constant principal payments plus interest annually, Bonds instead of mezzanine loans, and a charge for energy.

Ultimately this project was likely not for profit but for the betterment of the community throuand the providing of clean energy.

According to all forms of analysis this project is very feasible and makes a decent profit even brecommendations for financing.

After recommendation for financing the project becomes highly profitable making almost 10 tcurrently predicted.

Projects like Lieberose Solar Park help to drive renewable energies into modern markets whileland and air, and are recommended everywhere.

Conclusion

R f


38/43

Refrences

[1] http://www.solaripedia.com/files/242.pdf [2] http://www.juwi.com/project_development.html [3] http://www.firstsolar.com/en/about-us [4]

http://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&D&Category_Code=14&Product_Code=140002-001

[5] http://www.freecleansolar.com/First-Solar-Panel-Thin-Film

p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwE

Q & A
http://www.solaripedia.com/files/242.pdfhttp://www.juwi.com/project_development.htmlhttp://www.firstsolar.com/en/about-ushttp://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://www.freecleansolar.com/First-Solar-Panel-Thin-Film-FS-272-p/fs-272.htm?gclid=CjgKEAjwzIucBRDzjIz9qMOB3TASJABBIwL17xgO7FZVneXehhZG2Y9tM46eYLnifgcvvfaCCLJd3vD_BwEhttp://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://secure.schletter.us/mm5/merchant.mvc?Store_Code=S&Screen=PROD&Category_Code=14&Product_Code=140002-001http://www.firstsolar.com/en/about-ushttp://www.firstsolar.com/en/about-ushttp://www.firstsolar.com/en/about-ushttp://www.firstsolar.com/en/about-ushttp://www.juwi.com/project_development.htmlhttp://www.juwi.com/project_development.htmlhttp://www.solaripedia.com/files/242.pdfhttp://www.solaripedia.com/files/242.pdf


39/43

Q & A


40/43

What is the overall capacity of Liberose sola

project?

53MW

40MW

53MW


41/43

53MW


42/43

Arizona, USA Bradenburg, Germany

Where is Liberose Solar Park Located?


43/43

Documents

Lieberose Solar Park_Presentation-Worked (2)