James Saunders Next Gen 09


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James Saundres, Managing Director of Commercial Ventures Quintain discusses multi utility initiatives, vacuum waste disposal and fibre initiatives at NextGen 09 in Leeds on 16 and 17 November 2009

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James Saunders Next Gen 09

  1. 1. Multi Utility Challenges and Ventures James Saunders Managing Director, Commercial Ventures Quintain Estates Development © Quintain Estates and Development PLC 1
  2. 2. Quintain • Urban Regenerator – Wembley City – Greenwich Peninsula • Focussed on long-term revenue from infrastructure ownership • Challenging existing models of working with incumbents © Quintain Estates and Development PLC 2
  3. 3. What Multi-Utility means to Quintain • Synergies in deployment • Synergies in operations • Forming alliances of interested parties • Innovating business models • Designing new services that meet real consumer needs © Quintain Estates and Development PLC 3
  4. 4. Multi-Utility Challenges • Competing interests amongst alliance partners – Different mandates – Different risk tolerances – Different expectations: IRR’s, Year ends – Attitude to open book / documentation – Incumbents don’t play ball unless inside Musco © Quintain Estates and Development PLC 4
  5. 5. Multi-Utility Challenges • Lack of UK Precedents and Experience – Most Musco’s on hold – Few Esco schemes live – Few NGA networks operational – Consultants with no implementation experience – New business models, technology, alliances – Large corporates stretching into new niche areas – Business model has consistently been the hardest issue to resolve © Quintain Estates and Development PLC 5
  6. 6. Multi-Utility Challenges • Unclear Regulation – OfGem, OfWat, OfCom hard to navigate – Little joined up thinking, except protecting consumer – Changing goal posts – Private Wires, Battery Backup – Lawyers stretching to interpret rules (and learning at your pace) – Changing Regulatory landscape does not encourage new entrants and new models – Next Gen Telecoms are an after-thought compared to Decentralised Energy © Quintain Estates and Development PLC 6
  7. 7. Multi-Utility Challenges • Current Market Uncertainty - > build rate uncertainty – Balance sheets are weaker – Capex plans are difficult to commit – Can’t sell services if no residents or slower move in rates – Developer bears most of the risk in alliances – Partners withdraw from particular area or de-prioritise new initiatives Developer plot-by-plot mentality, not site-wide © Quintain Estates and Development PLC 7
  8. 8. So what are developers left with? • You can form an alliance of incumbents, but this is NOT a MUSCO  Need to take control and set clear criteria that work for you  Assemble a flexible team that has the right skills and experience to tackle the uncertainties ahead  Use modular / upgradeable technology  Focus on consumer benefits - not premium pricing  Flex the business model  Prepare to think again – tender operations separately from asset build  Hope for, but do not rely on, subsidy regime © Quintain Estates and Development PLC 8
  9. 9. What are Quintain doing? • Quintain are currently not implementing Musco’s • We are focussing on the infrastructure elements that make sense given development programme • Challenging incumbents view of the world • We seek partners with depth of operating experience (often from outside UK) • Sustainable Supply Chain management • Prioritising Renewable Energy, Telecoms and Waste Disposal • Taking the “Brave Pill” • Learning, re-applying, exporting © Quintain Estates and Development PLC 9
  10. 10. Waste Disposal: • Goals: – Zero wheelie bin environment – Fewer refuse truck trips – Higher recycling levels • Solution: Envac Vacuum Waste Disposal • Results: – 40% Increase in recycling – 90% fewer refuse truck trips – 400 tonnes less carbon per annum – 15p a month per resident to run © Quintain Estates and Development PLC 10
  11. 11. Envac System 1A: Waste is thrown into a waste inlet 1B: The system can be retrofitted with additional inlets 2: The computer- controlled evacuation takes 30 seconds 3: All waste is sucked out through a network pipes at a speed of 70km/h 4: Fans create the partial vacuum that sucks the waste through to the reception facility in the terminal station 5: The waste is directed to the correct container 6: The air is cleaned by filters before it is released © Quintain Estates and Development PLC 11
  12. 12. Fibre Optic Communications • Goals: – High speed broadband, TV, phone and multiple IP services to residents and businesses – Utilising single fibre connection – Instant activation for resident – Scalable across Quintain developments and others around UK • Solution: Velocity1 – JV with Industria Media – Flexible IP platform capable of delivering multiple services • Initial Services (because none other available) – 8,16,32,mb/s broadband with 100mb/s boost – Freeview TV and Sky-by-Wire – Phone with free calling packages – Local information portal • Open Access roadmap • Results: 90% consumer take-up of services. © Quintain Estates and Development PLC 12
  13. 13. © Quintain Estates and Development PLC 13
  14. 14. What have we learned after 12 months? • Consumer higher receptive to new services • However you must deliver the market norms – Service, Support, Quality, Bundles • Consumer very aware of national advertised pricing – “up to” etc • No need to deliver 100mb/s today, but need the capability • Residents can run businesses from home • Residents seek out your development because of superior internet access • Private customers value Broadband above all else; Affordable housing TV • Instant activation major benefit, especially in rental market • Marketing story for developers strong • There is a chronic shortage for FTTH ISP’s in the marketplace © Quintain Estates and Development PLC 14
  15. 15. THANK YOU © Quintain Estates and Development PLC 15