GIB - Bankability Study by Marco Grossmann at GIB Summit

GIB Bankability Study on City of Johannesburg Fuel Switch

––––––––––––––––––––––––––––––May 21th 2014

Marco GrossmannProject Leader

2 Global Infrastructure Basel Foundation ©www.globalinfrastructurebasel.com

Content

1) Goal of and Approach to the Bankability Study

2) Rea Vaya BRT and Metrobus

3) Draft Content Bankability Study


Goal and Approach

The ultimate goal of the study is to create a document that serves potential investors as brochure for financing a fleet of approximately 400 Diesel Dual Fuel buses, by:

• Applying the GIB Grading to mitigate risk and to showcase sustainability of the project in order to potentially lower borrowing/interest rates

• Conducting in depth analysis of the fuel switch of Rea Vaya and Metrobus

The approach is not to reinvent the wheel, but:

• To hold qualitative interviews in order apply the GIB Grading

• To collect, analyse and further develop already carried out work

• To build a tailor made financial model


Rea Vaya BRT

• Being rolled out in phases• Phase 1A: for 2010 SWC

from Soweto to CBD• Phase 1B: second route

from Soweto but different alignment

• Phase 1C: linking North and South and creating TOD opportunities


Rea Vaya

• Phase 1A– 25k of trunk route (dedicated) for

18 m articulated buses– 3 complementary and 5 feeder

routes using 13 m buses– 30 Rea Vaya stations service

passengers– Passenger numbers average of

43 000 per day– 143 Euro IV buses – 1000 permanent employment– Registered for voluntary carbon

credits• Phase 1B

– Another 18 km, 17 stations– 134 Euro V buses– Being rolled out since October

2013– Projected passenger numbers

60 000 per day– 600 permanent job opportunities


Metrobus

Timeline• 1942: Metrobus

established as City department

• 2001: Metrobus becomes a municipal owned entity

• 2010/11: Transport Department looks at future options for Metrobus to respond to changing public transport environment in City, aging fleet and outdated fare collection system

Key facts and figures• 1000 employees• 450 buses• 3 major depots

Draft Content of Bankability Study

Global Infrastructure Basel Foundation ©www.globalinfrastructurebasel.com 7

1. Context and selected best practice examples

2. Sustainability and Risk Analysis

3. Technology analysis

4. Technology provider

5. Logistics/Infrastructure

6. Legal and Policy Framework

7. Financial Cost/Benefit Analysis


Sustainability and Risk Analysis

Accountability

Transparency

Customer Focus

Results Orientation

Poverty Responsiveness

Power-Balanced Partnership

Shared Incentives

Sound Financial Mechanisms

Proactive Risk Management

Resource Protection

0

2

43.433.57

3.14

2.67

3.33

3.50

3.33

3.29

3.33

3.00

Good Performance (65 Percentile)

Modest Performance (10 Percentile)

Self Evaluation


Technology Analysis 1/2

General Description of Dual Fuel Technology (DDF)

• NGV market overview

• Technical description of DDF

Economy

• Proven and Safe Technology

• Reduced running cost due to lower cost of CNG

• Effects on maintenance cost

• Availability of CNG / Grid, possibility to diversify

to Biogas/methane (Fuel Security)

Ecology

• Reduced Carbon Emissions (15 – 20 %)

• Huge potential in Biogas/methane for further reduction (as well as NOx, PMs etc.)

Society

• Job creation opportunities through CNG, Biogas, TOD

• Local assembly of body and chassis

Ecology

Society

Economy


Technology Analysis 2/2

NGV and Bio fuels

Electric Vehicle’s and Hybrids

Fuel Cells

Building on todays innovation for tomorrows solutions

Maturing “Fit for Purpose” technology Innovation Cycles for each solution in an integrated and sustainable manner

Low Skill Jobs and High Innovation

Medium Skill Jobs and High Innovation

High Skill Jobs and High Innovation


Logistics and Infrastructure

Stakeholder-Analysis

• Gas Distributors,

• Grid Operators,

• Regulating Bodies

Fuel Security

• Pricing policies regarding CNG

• Availability of CNG, incl. outlook

• Solutions for Filling Stations


Legal and Policy Framework

Policies and Regulations in place e.g.:

• Municipal Financial Management Act

• Supply Chain Management Act• Division of Revenue Act• Land Transport Act• Requirements towards local job

creation, public consultation etc.


Financial Cost/Benefit Analysis

Composition of tailor made financial model, by comparing

Diesel vs Diesel/Gas vs Dedicated CNG in terms of:

• CAPEX, • OPEX (bus running and fix cost),

• Rate of Return (IRR), • Net Present Value (NPV), • Payback time, lifetime analysis,• Sensitivity Analysis

Thank you for your attention!Contact information

Mr. Marco [email protected]

+41 (0)61 205 10 36

mailto:[email protected]

mailto:[email protected]

GIB - Bankability Study by Marco Grossmann at GIB Summit

Investor Relations

Transcript of GIB - Bankability Study by Marco Grossmann at GIB Summit