Alex Hewitt, Wind Prospect CWP: Boco Rock Wind Farm financing

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Alex Hewitt, Managing Director, Wind Prospect CWP delivered this presentation at 2013 Australian Wind Energy Conference. The event gave conference attendees key insights into how the new Abbott Government may impact future developments in the industry. The conference has a long-standing history of bring together key policy stakeholders, government representatives, project developers, energy companies and regulators. For more information about the annual event, please visit the conference website: https://www.informa.com.au/windenergyconference.

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Alex Hewitt, Wind Prospect CWP: Boco Rock Wind Farm financing

  1. 1. Boco Rock Wind Farm: Financing Alex Hewitt | Managing Director, CWP November 2013 Working in Partnership. Delivering Capacity.
  2. 2. BOCO ROCK WIND FARM • Planning approval received August 2010 • REF (T-Line) consent approval received March 2011 • Consented for 122 WTGs, 270 MW nameplate capacity • Located 10km southwest of Nimmitabel, 30km north of Bombala • Stage 1 Financial Close – June 2013 • 58 x GE 1.7-100 WTGs • 9 x GE 1.62-100 WTGs • Nameplate capacity of 113.18 MW Boco Rock Wind Farm • Wind farm to be connected into Essential Energy’s 132 kV sub transmission network at Steeple Flat Zone Substation Page 2
  3. 3. WIND FARM STAGES – 1, 2 & 3 • General Electric (GE Energy) WTG Supplier • Mix of GE 1.7-100 and GE 1.62100 WTGs • 67 turbines in Stage 1 • Connection to 132kV network • 25 km from Collector Substation • Essential Energy responsible for co-development of Steeple Flat Zone Substation Page 3
  4. 4. PROJECT MILESTONE SUMMARY • • • • • Financial Close 26th June 2013 $361 Million Project Financing – 5 Banks (domestic and international), Equity - EGCO Construction Cost (EPC) $270 Million EPC Delivered by GE-Downer Consortium Long-Term Energy Offtake with EnergyAustralia Financing of 113 MW Wind Farm Australia 2013 Page 4
  5. 5. KEY CHALLENGES • Primarily revenue predictions – Energy yield – Tariffs: post-PPA forward pricing • CAPEX - FOREX movements • Interest rate fluctuation Page 5
  6. 6. EUR: AUD EXCHANGE RATE VARIATION Page 6
  7. 7. NSW ANNUAL ENERGY FORECAST Figure 1: Annual Energy Forecast for NSW Source: AEMO 2012 National Electricity Forecasting Report, 29 June 2012 Page 7
  8. 8. UTILITY PRICING REVIEW Synapse Energy assessed a wide range of carbon price forecasts by US utilities. These utilities have a real and live exposure to the energy market, cost curves, abatement technologies and politics both domestically and internationally. The outcomes of these reviews can be seen in US dollars below. Figure 4: Synapse Utility Review Utility Mid Case CO2 Price Forecasts Source: Page 19 Synpase Energy Economics, Inc. “2012 Carbon Dioxide Price Forecast”, 4 October 2012 Page 8
  9. 9. PROJECT TEAM Others involved: • Team of ~60 people working over last 12 months on lead up to Financial Close • Cost $5m spent of financing • Herbert Smith Freehills • KWM • Baker & McKenzie • ANZ Financial Advisory • HSBC Financial Advisory • GL-Garrad Hassan • SKM • PB Power • Senergy • PwC • Strathern • AON • Environ • ROAM Consulting • ACIL Tasmin • GE Energy/Downer EDI Documents Contracts – Key Documents Over 2000 pages of final contracts and Due Diligence reports • • • • • • • • • • • • • • 4 wind reports 3 market forecasts ( post PPA) MLA forecast Environmental report Tax and accounting report Technical DD report Legal DD report Insurance report CEMP (including 8 sub reports) • • • • EPC (480 pages ) PPA (5 docs ) Land - Leases and easements, Biobanking, transfer of crown roads Approval conditions – principal DA, EPBA GCA, generator registration, Steeple Flat Co-Development FSA – turbines and BOP contracts AMA and engineering Loan agreement Numerous ancillary agreements – direct agreements, insurance, guarantees, security, escrow Page 9
  10. 10. STAKEHOLDER RELATIONSHIPS • Landowners – • Council – • Hosts 17 wind farm + 7 Transmission Line Mayor, General Manager, Roads and Planning Govt. Agencies – C’wth Dept. Environment – NSW Dept. Planning – NSW Dept. Environment – Crown Lands – Office of Water • Politicians • Essential Energy • AEMO Page 10
  11. 11. Page 11
  12. 12. ROADWORKS AND COLLECTOR SUBSTATION CONSTRUCTION Page 12
  13. 13. QUESTIONS Page 13
  14. 14. GRID CONNECTION ARRANGEMENT Williamsdale 978 Essential Energy’s Cooma-Bega 132kV and 66kV Subtransmission System 97D Snowy Adit 33kV (Essential Energy) Jindabyne East COOMA Substation 66kV (Essential Energy) 132kV (Essential Energy) 97R/1 974 New Cooma Bega 132 kV Line (Cooma to Steeple Flat now single circuit 132 kV) 132kV (TransGrid) Essential Energy’s Needs Existing Cooma Bega 132 kV Line (No Change) • N-1 redundancy for Bega • Automated switching capability for Bombala • Improved security of supply for 22 kV network Boco Rock Wind Farm Project’s Needs G N.O. 810/3 Brown Mountain Hydro (5MW) G STEEPLE FLAT Substation (132/66 kV transformer to provide the normal supply to Bombala) • • • • Minimal grid CAPEX Brogo Minimal network disruptions Maximise community collaboration and benefit sharing 7802 Bankability 97R/2 & S839 Maher St ZS 66/11kV 974 Quira ZS 66/33/11kV 810/4 7803 Boundary St ZS 66/33kV Bombala Zone Substation 66/22kV Eden South Pambula BEGA Substation Page 14

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