armed- westfield energy: photovoltaic project in pr
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TRANSCRIPT
SANTA CRUZ
Monetization through Development of a Solar PV Project
WESTFIELD ENERGY
February 7, 2013 Atlanta, Georgia
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RENEWABLE ENERGY
• Increasing oil prices have driven PREPA’s rates to double that of the US average rate of 11 cents per kWh
•PREPA’s current system is oil reliant
•In order to address this, PREPA has a plan to either convert its plants to dual fuel or to source non-oil reliant PPAs
•PREPA plans to increase its renewable energy from 1% of its portfolio in 2012 to 16% by 2016
WESTFIELD ENERGY
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PHOTOVOLTAIC SOLAR (PV)
• Photovoltaic (PV) systems help the environment by producing clean, renewable energy that replaces energy produced by power plants that burn coal, oil, and natural gas.
• The amount of solar energy available on earth for PV power is 10,000 times greater than the total world energy use
WESTFIELD ENERGY
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SOLAR ECONOMICS
• $1.60 - $1.80/Watt Construction Costs
•$.06 - $.07/KWh Generation Cost
•$.24/KWh PREPA Retail Price
•$.13 - $.15/KWh PPA Prices
•Interconnection Costs
WESTFIELD ENERGY
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KEY GLOBAL SOLAR DEVELOPERS
WESTFIELD ENERGY
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HYBRID DEVELOPERS
WESTFIELD ENERGY
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TOP GLOBAL SOLAR PROJECTS
WESTFIELD ENERGY
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PROJECTS IN P.R.
•AES Ilumina, 24 MW Guyama
•Western Wind, 30 MW Yabucoa
•Salinas Solar (Sonnedix, Yarotek) 12 MW
WESTFIELD ENERGY
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EXISTING POWER INFRASTRUCTURE
WESTFIELD ENERGY
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In 2011, 68 percent of Puerto Rico’s electricity came from petroleum, 16 percent from natural gas, 15 percent from coal, and 1 percent from hydroelectric power.
Puerto Rico has adopted a Renewable Portfolio Standard requiring 20 percent of net electricity sales to come from renewable energy resources by 2035.
The existing power system in Puerto Rico has an installed capacity of approximately 5,830 MWs and a peak load of about 3,350 MW.
SANTA CRUZ MONETIZATION STRATEGY
WESTFIELD ENERGY
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•Property will be marketed to leverage its value in the renewable energy space.
•Potential counterparties will include key global solar developers, global energy producers, as well as PREPA and PRLA
•Approximate target price for parcel in its entirety is $40 million
•Westfield Energy will leverage relationships with the overarching energy industry as well as with state controlled entities
SANTA CRUZ MONETIZATION STRATEGY – CONT’D
WESTFIELD ENERGY
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• Westfield Energy will serve as consultant and broker to ownership group
• Ownership group will commit to allow Westfield Energy exclusive rights to negotiate with renewable energy developers, global energy companies, and state authorities on the parcel for a rolling three year time period terminating when final negotiations have ceased with a given counterparty
• Minimum price to be established by ownership group
SANTA CRUZ MONETIZATION STRATEGY – CONT’D
WESTFIELD ENERGY
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• Ownership group retains all rights to market and sell property completely unencumbered to any other entity at any time outside of the scope of the agreement with Westfield Energy.
• Ownership group is bound to sell the property if minimum threshold price is negotiated by and contracted with Westfield Energy counterparty as defined in Agreement.
• A six percent (6%) fee calculated on the purchase price will be paid to Westfield Energy directly by the Purchasing Party.
• Ownership group will only pay a fee on the amount of the purchase price that exceeds $40 million.
SANTA CRUZ MONETIZATION STRATEGY – CONT’D
WESTFIELD ENERGY
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• Ownership group to pay a 10% fee to Westfield Energy on the amount of the purchase price that exceeds $40 million.
• Ownership group has complete access to all bids, proposals, and counterproposals disseminated between parties.
• Ownership group to establish one primary contact for reporting and informational purposes between Westfield Energy and ownership group.
A SUCCESSFUL PARTNERSHIP
WESTFIELD ENERGY
Tom Coleman is the Principal at Westfield Energy, LLC. Mr. Coleman has been working in the energy industry since 1990 upon his graduation from Vanderbilt University’s Owen Graduate School of Management. Mr. Coleman has held leadership roles at Williams Energy, Southern Company, Bear Stearns, and JP Morgan prior to starting Westfield Energy. His experience includes negotiating highly structured electric tolling deals, municipally financed natural gas and electric prepays, electric power purchase agreements, M&A negotiations, renewable energy tax benefit transactions, land acquisition and sale, and energy related commercial real estate transactions. Over the course of his 20 plus years of experience he has developed relationships with IOU counterparties, state run power and gas authorities, LDCs, VC backed projects, and renewable project developers.
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