Hydropower Projects
Net Metering
In Pakistan, the hydroelectric power plants are more than 50 years’ old which requires upgradation: modernization, digitalization and hybridization of the existing hydroelectric power plants (HPPs). The KP province, northern areas in particular and Pakistan as whole has great hydropower potentials.
The development of PPP and private hydro power projects requires huge funding by the government, private investment, climate investment funds and other national and international development banks and donor agencies. Project financing, in both cases, PPP and HPPs, is key to the success of hydroelectric power project investment, the flexible mix of equity and long term debt financing
We are here to coordinate with the national and international institutions, manufacturers, suppliers, legal firms, and other concerned agencies for arranging financing for 10 Million Euro and more for a period from 10 to 20 years for hydropower, wind and solar projects.
We are providing turnkey supply of HPP, (financing, feasibility, design, manufacturing, installation of plant and sub-station, commissioning, training), upgradation of micro, mini and small hydro power projects; supplying products and services in collaboration with the reputed national and international hydro power plants manufacturers:
Monitor & Control:
- Compact, modular design concept
- Oil-free Kaplan runners
- Fish friendly solutions
- The new generation of integration, automation, control center system, optimize your operation and process control
- Hydropower plant inspection, and assessment, operation and maintenance, digital solutions and services
- An innovative Low Head solution for existing infrastructure like dams, gates, weirs, etc., usage of ecological flow for additional power generation.
- Upgradation of micro, mini and small hydro power plants
- Digitalization of hydropower plants and processes (IoT Industry 4.0)
- Hybridization, the integration of solar & wind power with batteries/hydrogen energy storage systems in the existing or new hydropower plants.
Project Financing of PPP and Private HPPs
- Flexible mix of equity and debt financing
- Balance of interests of private investors and the state
- Analysis and management of investment project risks
- Concession for the construction of hydroelectric power plant
- Cash flow guarantee is extremely important for investment: buy energy from 10 to 20 years.
Benefit of Project Financing
- Investor join the project only after obtaining licensing and participation of government (in case of PPP)
- The government facilitate during construction & operation of facilities
- A private investor will start a project if the expected income significantly exceeds the cost of the capital involved
- Competent private sector partners have a beneficial effect on the prospects for an investment project.
Limited Resource Project Finance
It’s a unique mechanism to raise significant amount of funds without involving its own assets as collateral for debt. Instead, the investment project acts as a collateral, and the borrowed funds are provided through ‘SPV’ as an independent initiator. The borrowed funds do not put pressure on the balance of initiating Company. Therefore, project financing is also called off-balance sheet financing. In case of bankruptcy of initiating Company, the lender can continue construction. However, the obvious drawback of this scheme is complexity of the multilateral contractual relationship to ensure the viability of hydropower project – which can be resolved if the project is turnkey supply includes civil works, on ‘water-to-wire’, basis.325
Revenue in 2017 (Million)
525
Collaegues & Counting
302
Successfully Project
25
Year of experience
Alternative Ways to Finance HPPs:
Equity Financing
- It is raising capital in exchange for a certain part of a company or project by issuing shares
- Shareholders receives dividends
- Equity financing of HPPs involves the future cash flows to the lenders
- Two large groups of hydropower equity investors:
- Financial Investors: Private investors or mutual funds, usually not specialized in any sector, esp. hydropower; but always looking for financial opportunities
- Strategic Investors: Energy Company and sectoral investment funds, experienced in hydropower, to invest large sums in construction of HPPs on turnkey supply including civil works, ‘water-to-wire’ basis.
- If the project fails, equity investors are not paid divided
Debt Financing
- It has the advantage over equity financing, as the entrepreneur remains independent
- Owner does not lose his share of the business nor oblige to ask anyone shareholders to involve in his operating strategy
Long-Term Loans from Commercial Banks
- Banks, Companies, individuals provides money for the business and the borrower is obliged to pay the debt plus agreed interest
- Lenders do not have strategic decisions nor do they share risks and dividends
- However, under standard terms and conditions lenders may control over the assets
The Team
Our Experts
Mike Rich
Lead Architect
Jenny Smith
Head Engineer (US)
George Doe
Head Engineer (CN)
Maria Jay
Head Engineer (AU)
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