International Business Meeting, Port-au-Prince, 1-2 October , 2009
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Transcript of International Business Meeting, Port-au-Prince, 1-2 October , 2009
HAITI: OPEN for BUSINESS OCTOBRE 1st 2009
investment opportunities in renewable energies
Dieuseul ANGLADE, eng. Director General
Bureau of Mines and Energy
International Business Meeting, Port-au-Prince, 1-2 October, 2009
BME
Presentation Plan
1. Overview of the energy Sector
2. Investment opportunities
3. Conclusion
BME
1. Overview of the energy sector
Haiti energy “consumption” matrix(% TOE)
hydro
Haiti energy “markets” matrix(USD)
Diesel(380 M) Wood-Charcoal
(150 M)
Wood
* Most wood-fuel consumed by SMEs (Moonshine, drycleaners, bakeries)
Biomass (wood & charcoal)
72%
Petroleumproducts
25%
Other petroleum fuels
BME
The energy demand
Transportation, industry and domestic consumption
• 380 000 tons de charcoal per year for families:a US$ 150 M market
• 200 000 tons of wood in the SMEs : a US$ 60 M market
• 130 millions gallons of diesel : a US$ 380 market
1. Overview of the energy sector
BME
2.1 Liquid fuels
bio-fuels (biodiesel)
Progressive substitution of 45 million gallons of diesel consumed by the thermal generators in power plants.
130 million gallons of diesel consumed yearly.
The telecommunications companies consume about 4% of the imported diesel.
2. Investment opportunities
BME
2.2 Cooking energies
WoodlotsProject of creation of woodlots in unused lands
Substitution of keroseneReplacement of kerosene lamps with lighting by small PV systems in rural areas
Briquette production
Production of briquettes from waste/renewable sources of biomass as substitutes for wood & charcoal
2. Investment opportunities
BME
2. Investment opportunities2.1 Wind Energy
• Lac Azuéï 10 km from P-au-P grid; 50 MW potential
wind speeds : 5 to 7 m/s.
• Northern Haiti Near Cap-Haitien grid; 2 MW potential
wind speed : 5 to 6 m/s.
The preliminary study is being executed by 3E, a Belgian firm.
Feasibility studies will be undertaken next.
BME
2.3 Solar energy
Solar panel assembly plants
Small PV rural solar projectsFor lighting, pumping, seafood and vaccine conservation
2. Investment opportunities
BME
The energy market is the second largest in Haiti after the food market.
There are already good examples of successful public-private partnerships in the Haitian Energy Sector, where the Government has committed to buying all the power produced for 5 to 15 years:
SOGENER, HAYTRAC, E-POWER
3. Conclusions
BME
The Government of the Republic of Haiti has also committing to the following actions :
• Elaboration and submission to the vote of Parliament a bill for the creation of the enabling framework for the acceleration of the use of renewable energy and the associated technologies ;
• Implementation of various forms of incentive mechanisms for the promotion of private sector investment in renewable energy (production and deployment);
3. Conclusions
BME
• Pursuing actions related to the development of biofuels, in particular: feasibility studies, R&D and the reinforcement of Public-Private partnerships;
• Carrying out a public awareness campaign for renewable energy, utilizing instruments designed to inform and motivate.
HAITI IS WORKING HARD TO MAKE THE ENERGY SECTOR A GROWING
AND SUSTAINABLE SECTOR
3. Conclusions
BME
THANK YOU
Dieuseul ANGLADE, Ing. Directeur General
Bureau des Mines et de l’Énergie
Email : [email protected] Web site: www.bme.gouv.ht
BME
IDB International Business MeetingInvestment in Wind Power Generation from an International
Investor’s Perspective
Rolando Gonzalez-Bunster
International Business Meeting, Port-au-Prince, 1-2 October, 2009
BasicEnergy
Economic and Commercial Aspects
• Country’s political situation should be stable and should present
macroeconomic growth in the short term.
• Payment risk needs to be minimal
– Capital for these projects migrates very easily. If too much risk is perceived in a certain
country and/or market, investors will identify alternate places to deploy their capital and
develop similar projects where less risk is perceived.
– Long Term (15-20 yr) Power Purchase Agreements (“PPAs”) are a must to secure financing.
• Involvement of multilateral funding is highly desirable.
– Commercial financing in developing countries tends to be very short term with high interest
rates which limits the possibilities to develop capital-intensive projects like wind power
projects.
Financing sources like IDB play a significant role in promoting these projects in developing countries.
BasicEnergy
Site Selection• Initial site selection is a very methodical and technical exercise.
– Once a site is selected, significant time and resources need to be dedicated to research its
feasibility.
• Wind atlases which contain macro wind measurements are not enough
(these only provide general guidelines). Site-specific towers need to be
erected in order to measure wind behavior for at least one (1) year.
• For financing purposes, these site-specific measuring towers need to be
measure wind speeds at least 2/3rds the height of the expected hub height of
the wind turbines (as high as 100+ meters).
– These measurements need to be validated by independent third parties
An investor will typically invest in securing the site and purchasing wind turbines once the site is validated by site-specific wind measurements
BasicEnergy
Permitting• Too much bureaucracy hinders project development.
• In countries where wind projects have not been developed, authorities are
typically hesitant to fast-track permitting - this creates a barrier against
developments.
– Other countries are competing for these projects and are willing to have more streamlined
permitting processes.
• Permitting is required for financing, hence if the permitting process is not
clear and streamlined, achieving financing can become challenging.
A single point permitting window is highly desirable
BasicEnergy
Technical and Construction Aspects
• Available offloading ports are one of the early items that need to be
identified when making an investment decision.
– The lack of proper infrastructure to offload the equipment from the ships could easily
eliminate the chance for a successful project.
• Access to site from to the unloading point to the each of the towers’ location
is also an important task that needs to be performed early on in the
investment decision process.
– If too much investment is required due to: 1) poor road conditions; 2) tight curves that don’t
allow blade transportation; or 3) Mountainous terrain; then project feasibility can be
jeopardized.
• Access to grid as close to the site as possible.
– A long transmission line can increase project cost significantly and threaten the project’s
feasibility.
• Terrain profile can influence balance of plant costs
BasicEnergy
Carbon Credits• Although the variable costs of wind projects are minimal, the construction
aspect is very capital-intensive. As such, power prices need to be high
enough to repay the financing and allow for an acceptable return to the
investor. Energy prices are typically not enough to allow for this.
• To solve this issue, carbon credits are one of the few lifelines to make
projects feasible.
• The current Clean Development Mechanism (CDM) expires 2012. Difficult
to predict carbon credit impact on a project’s economics post 2012.
• A wind project in Haiti would displace Diesel (no. 2) generation – this is a
“cleaner” fuel than Coal or Heavy Fuel Oil which results in less carbon
credits than the same project could generate in other countries with a
“dirtier” energy matrix.
BasicEnergy
THANK YOU!
Rolando Gonzales Bunster, Basic Energy
BasicEnergy
Prospects for Jatropha curcas
cultivation in HaitiCHIBAS
CHIBASInternational Business Meeting, Port-au-Prince, 1-2 October, 2009
Why Jatropha?• Haiti presently imports over twice as much diesel fuel as gasoline (ethanol is a
substitute of gasoline)
• Haiti heavily depends on diesel for the production of electricity
• Feedstock for ethanol production would compete for the best arable land; which is
limited
• Ethanol would have a relatively small local market
• Oil processing and production of bio-diesel is scalable
• Plant oil can be used directly (for local electric power generation, mills, irrigation, and
small industry)
• And Jatropha is potentially a multipurpose crop (reforestation & restoration of
degraded land, biodiesel, SVO, charcoal briquettes, high protein animal feed and
honey)
CHIBAS
CHIBAS
> USD 350 M
> USD 150 M
> USD 60 M
Energy matrix (Market)
% o
f en
ergy
mix
(m
arke
t)To
ns o
f O
il E
quiv
alen
tThe market for Biodiesel
* Most of the wood is not sold on the market
*
• How much land can be usedto grow Jatropha ?
• Expected yields ?• What are the profits from
growing Jatropha ?
Mapping the risks (red):
Land use, environment,
areas suitable for food crops,
other socio-economic risks, etc…
Land availability for Jatropha
CHIBAS
Land use map
Land availability for Jatropha
CHIBAS
A B
In green: area where you can grow Jatropha with limiting the negative impacts.
A: >800,000 ha
B: >500,000 ha
There is enough land to meet Haiti’s diesel market!
A multipurpose cropThe markets for Jatropha
Edible Jatropha
• Oil & Biodiesel (liquid biofuels) 100 million gallons (280 M USD)
• Charcoal briquettes80,000 ton (23 M USD)
• High protein animal feed550,000 ton (165 M USD)
• Honey12,000 ton (36 M USD)
Non edible Jatropha
• Oil & Biodiesel (liquid biofuels)100 million gallons (280 M USD)
• Charcoal briquettes200,000 ton (60 M USD)
• Honey12,000 ton (36 M USD)
CHIBAS
Working with small holdersMaximizing profit along the value chain
• Integrate small holders to the Jatropha value chainThere is an opportunity to develop a market chain integrating small holders
and producers; one that is profitable to ALL the actors of the value chain
(IDB market study)
• “Lwil Agogo” – building strategic alliances along the value chainProfitable businesses integrating the small holders and producers
CHIBAS
CHIBAS at the service of the local agro-industry
1. CHIBAS will be improving, releasing and promoting the use of improved
Jatropha varieties as multipurpose crops (food/feed and energy);
2. CHIBAS is a technical center to serve the farmers and the agribusiness
sector in getting access to the best and most adequate technology and the
best agricultural practices;
3. CHIBAS realizes feasibility studies to establish plans for the formulation of
project designs (or projects) and investment strategies (including a
complete sustainable and profitable value market chain assessment)
maximizing incomes for the farmers and the local communities.
CHIBAS
THANK YOU!
Gael Pressoir, CHIBAS, Executive DirectorGeneticist & Plant [email protected]: gael_pressoirPhone: +509 3465 0449
CHIBAS
Can the biodiesel value chain be an opportunity for Private Sector Investments in Haiti?
BID & USAID-DEED
Source: Biodiesel Value Chain Feasibility Study for Haiti – IDB and USAID/DEED
International Business Meeting, Port-au-Prince, 1-2 October, 2009
The study has considered 3 lines of business
FARM BUSINESS
JATROPHA PRODUCTION CENTER (JPC)
BIODIESEL
Jatropha pressingChemical plant
Oil
Cake
Machine to press jatropha
Solid fuel-pellet
IDB & USAID-DEED
FARM JATROPHA PRODUCTION CENTERBIODIESE
LINDUSTRY
Final products considered in the study
Final products subject to more investigation but with potential
% Shown as % of dry fruit.
Notes:
GENETICR&D
SEEDS
The main products have been considered
IDB & USAID-DEED
Logical FrameworkOpportunity:• There is a market
• Private Investments provide good returns
• 3A benefits are huge
Challenges:• Entrepreneurship• Regulation & Public
Investments• R&D best crops• Focus of development
actors: arid/semi-arid lands
Strategic Options for Haiti:
• Private Sector
• Public Sector and Development agencies
Scenario we can accomplish together
IDB & USAID-DEED
Except for the small scale biodiesel plant, the three businesses present NPV positive in all scenarios
Farm business:NPV/ ha
Jatropha Production Center businessNPV/ JPC
Biodiesel business:NPV/ industrial plant
Income/ ha1 = $229
1 Income in fifth year
2 5 19 4 46 186
$ 689,774 $ 3,123,851
$ 674,215
$ 43,945,922
$ 3,395,491 $ 688,714
700 ha 6,500 ha 65,000 ha
Variation of NPVs according to oil prices and jatropha land productivity
Asumption:Diesel pump price in Haiti: $2,31
IDB & USAID-DEED
$US2,5/gallon and 200gl oil/ha seem to be the break-even point for the Haitian biodiesel business
Break-even point
Assumptions:• Diesel price at pump in Haiti• Oil price (JPC business): 50% diesel price• Jatropha dry fruit (Farm business): 10% oil price• JPC business includes pellets business
Variation of NPVs according to oil prices and jatropha land productivity
($US / gal) ($US / gal)
($US / gal)
IDB & USAID-DEED
The economic impact in terms of development of each business is also significant in all scenarios analyzed
700 ha 6500 ha 65000 ha
$ 229 $ 229 $ 229
$ 218 $ 218 $ 218 Salary
Profits
238 2210 22100Jobs
$447/ha
35 195 260 3250 32502600
$ 554
$ 664
$ 554
$ 709$ 664
$ 554
2 5 19 4 46 186
700 ha 6,500 ha 65,000 ha
$1000-1150/ha
Farm business:Income/ ha
Jatropha Production Center businessIncome/ ha
Biodiesel business:Income / industrial plant
194,000 gl/year
1,8MM gl/year 18MM gl/year
$ 29,284
$ 573,341
$ 7,304,394
IDB & USAID-DEED
For a scenario of 500,000 ha of jatropha planted, 450,000 jobs can be created. Also, $460 of income per year can be generated for a minimum of 250,000 producers
(1) From the fifth years and on
500,000HECTARES
• 250,000 owners• 184,000-203,000 jobs
(170,000 approximately on the farms)
• Income per capita(1): > $460/ owner (=$2000/ owners with the JPC’s) > $220/ worker
• Environment: • Replace the entire charcoal market ($320M)• Renewing arid lands for fruit crops in the future
450,000 jobs
Attractive vision because:• scheme of farm owners integrated with the JPC’s• arid or semi-arid land• can possibly be a transitory and complimentary culture• efforts both focused and at a national scale
VISION
IDB & USAID-DEED
THANK YOU!
Eduardo Almeida, BID
IDB & USAID-DEED
Eucalyptus Project for Biomass Production
FGV - BID
International Business Meeting, Port-au-Prince, 1-2 October, 2009
Agroclimatic Zoning Land Capability
Methodology
FGV - BID
Eucalyptus
Phase 1 – Land Suitability
FGV - BID
Eucalyptus in the World
Source: ABRAF, 2007
FGV - BID
Haiti Energy Matrix
Area Covered by Forest:
3,8%Source: IEA.
FGV - BID
Biomass Project
Manufacturing
Firewood Stove
Bricket
FGV - BID
18 month
Process of Forest Production
FGV - BID
Forest Management Population (trees/ha) 3,460Spacing (m) 1,70 × 1,70 Cutting cycle (years) 4° and 7°
4° year- 1.730 trees 200 m³/ha
7° year-1.730 trees 350 m³/ha
Average in 7 years 50 m³/ha/year
Biomass ProductionFire wood production per ha year (50% Humidity) 31,6 tBiomass production per ha year (10% Humidity) 15,8 t
Forestry Project
FGV - BID
0
20000
40000
60000
80000
100000
120000
1 2 3 4 5 6 7 8 9 10 11 12
Project Production
Biomass Volume t
Biomass ProductionTotal biomass production in the 4°, 5° and 6° year 40.000 t per yearTotal biomass production After 7° year 110.000 t per year
Forestry Project
Total area: 6.000ha – 1.000ha per yearEarly planting First harvest
FGV - BID
Biomass Project
BPF Natural Gas Firewood (50% humidity) charcoalBiomass (10%
humidty)
9.700 Kcal/Kg 9.065 Kcal/Kg 2.400 Kcal/Kg 7.365 Kcal/Kg 4.600 Kcal/Kg
FGV - BID
Total Investments per unit of 1.000ha, USD
Forestry Unit
Nursery investment for seedling USD 980.000
Investment in Infrastructure Forestry USD 950.000
Investment in machine shop USD 200.000
Others USD 100.000
Production cost per ton of eucalyptus (50% of humity) (1) USD/t 32
Industrial Plant Valor
Installed capacity t/hour 20,40
Year production after 7° year of biomass (10% of humidity) t 110.000
Industrial Investment USD 9.000.000
Grid investment - low voltage USD 50.000
Infrastructure investment USD 150.000
Water well USD 50.000
Production cost of Biomass USD/t 25
Economic issues after 7° year Valor
Sale price of biomass (bripell) USD/t 200
Annual revenue USD 22.000.000
EBITDA USD 15.090.000
IRR % 26%
(1) Considering harvest and transport in radius of 80 Km and average of 12 years.
Project Production Bripell with Eucalyptus Biomass
FGV - BID
The Biodiesel Haiti project
Biocarburants d’Haiti, SA
International Business Meeting, Port-au-Prince, 1-2 October, 2009
Who we areBiocarburants d’Haiti S.A.
Haitian Corporation established in 2007 Major stakeholders: 4 local entrepreneurs: Reynold
Roy, Reginald Noel, Georges Garnier, Pascale Oriol Paid up capital: us $ 120,000 Present activity: production of biodiesel on an
experimental basis out of used vegetable oil collected from local restaurants
Current production: 500 gal /month sold to individuals
Biocarburants d’Haiti, SA
What do we want to do ?
Based on experience acquired over the past 2 years:
Transform current activity into a biodiesel production project out of jatropha oil
Biocarburants d’Haiti, SA
How do we want to do it? Phase 1 : use 1200 hectares of land located in
plateau central and owned by one of the major stakeholders to plant jatropha.
Phase 2 : encourage small farmers to participate in a jatropha plantation program (with the help of winner project usaid)
Incentives will include: free seeds from our nurseries, technical assistance and a guaranteed purchase agreement at a pre approved price
Biocarburants d’Haiti, SA
Our production Goal: 1 Million gallons of biodiesel
Phase 1: 300 gal/ha/year
for a total production : 360,000 gal of biodiesel
Expected time to full output : 3 years
Phase 2: 640 000 gal out of jatropha plantations own by small farmers
Expected time to full output: 3 years from end of phase 1
Biocarburants d’Haiti, SA
Target Market
Private industries with electricity generation capacity (generators)
currently 22 % of Haiti’ s diesel consumption or 25 M gal / year
Biocarburants d’Haiti, SA
2011 2012 2013 2014 2015 2016 20170
0.5
1
1.5
2
2.5
3
3.5
YearM
ark
et
sh
are
(%
)
At today’s diesel price of $ 2.80 we expect to be 10 to 15 % cheaper
At today’s price, sales at end of phase 2 will amount : $ 2.5 millions
Expected net profit on sales : 21 %
Biocarburants d’Haiti, SA
What price?
2011 2012 2013 2014 2015 2016 2017
-20
-15
-10
-5
0
5
10
15
20
25
YearT
RC
-ac
tio
n (
RO
E, %
)
What is the estimated investment?
2,8 Millions us $ for plant and related equipment as well as
plantation program
Biocarburants d’Haiti, SA
What are we looking for in potential partners?
Help in refining and completing project document
Equity financing Assistance in securing bank financing Technical, logistical and managerial
support once project launched
Biocarburants d’Haiti, SA
WINECO-TEVASAEthanol plant
TEVASAInternational Business Meeting, Port-au-Prince, 1-2 October, 2009
Terminal VarreuxWHARF SPECIFICATION
DRAFT 11.0 METERS FOR WHARF 9.8M FOR TANKERS
LOA 190 METERS MAXFENDERS YOKOHAMA
LIST OF TANKS
46,000 BBLS 1646,000 BBLS, WITH FLOATING ROOF 225,000 BBLS 217,500 BBLS 18,300 BBLS 4
TEVASA
Caribbean Basin Initiative (CBI)
TEVASA
• Ethanol produced/processed in beneficiary countries are permitted to enter the US duty- free
• Ethanol has to originate from bio-mass sources and has to have undergone a full transformation process in the CBI country
• Tax saving of US 54 cents a gallon
30 million gal.year dehydration plant
TEVASA
• In full operation by mid 2010• Expansion possible to 60 M gal• Corresponding tanks and infrastructure
additions to accommodate the increased volume are planned
30 million gal.year dehydration plant
TEVASA
• In full operation by mid 2010• Expansion possible to 60 M gal• Corresponding tanks and infrastructure
additions to accommodate the increased volume are planned
Processing ethanol for the US market
TEVASA
• Final stages of negotiations• Ethanol will originate from Brazil and after
processing in Haiti it will be exported to US for further blending with gasoline
Plant Layout
TEVASA
ENERSA
Renewable Energy For a Better World
Transforming Haïti’s energy challenges into wealth and job creating opportunities
International Business Meeting, Port-au-Prince, 1-2 October, 2009
ENERSA
COMPANY PROFILE• Haïti’s only designer and
MANUFACTURER of solar panels and solar appliances
• Small, young,… but the FASTEST GROWING solar company in the country (700% growth)
2007 2008 2009 E 2010 P
Sales $US 40000 100000 700000 2000000
250 000
750 000
1250 000
1750 000
2250 000
Company Sales History & Projections 2007 - 2010
• Socially responsible company– Trained from scratch & employed so far
18 solar technicians (almost all of them youth from Cité Soleil)
– Investing in our Human Resources – Investing in environmental projects– Supporting youth initiatives
– Industry leader in number of installations (in just over 2 years of operations)
– From 800 sq ft, moving to new 10,000 sq ft facility
• Widest covered geographic area
– 58 towns & remote villages… and counting– contracts in all 10 departments of the country
In very little time, we became the best local partner for nationwide solar projects
ENERSA
SOLAR as a strategic solution
Haïti in excellent radiation zone 750,000 to 1M households without access
Grid Access12%
Other Sources
22%
No Electricity66%
HAÏTI ELECTRICITY ACCESS
• Making PV affordable & accessible• Reducing the country’s dependence
on imported fossil fuel• Creating jobs
So, we’re in the business of Socioeconomic Development
Germany has 10 times that, just in solar PV- 1,500 MW PV installed in 2008 alone
Spain Installed 1,800 Mw PV in 2008
has an OVERALL installed capacity of about 360 MWwhile Haïti
Estimated total PV installed : only 700 Kw
SOLAR STREET LIGHTMARKET VALUE ADDED CHAIN
ENERSA
15%
15%
28%
14%
21%
7%
PV MARKET VALUE ADDED CHAIN
Si- Feedstock
Wafer
Cell
Module
BOS
Installation
Manufacturing Division
Installation Division
43%
Si- Feedstock
Wafer
Cell
Module
BOS
Installation
Solar appliance
59%
MANUFACTURING as a wealth creating option
ENERSA
OUR PRODUCTS
Mobile phone chargerSTANDARD model
Mobile phone chargerBELT model
Mobile phone chargerBELT model plus
CHAJMANSmall BusinessMobile phone Charging station
Solar Lamp- Light- Radio- Mobile phone
Solar Home System- 3 Lights- Radio- Mobile phone
Solar Module PS-X- 30W- 60W- 120W
NATIONAL TEAM WORK
Components from other Haïtian
industrial companies as
much as possible
ENERSA
OTHER PRODUCTS & SERVICES
Village Mini Central Solar Plant
Solar Irrigation Pump
Coffee Export Coop
Hospital
MULTI Kw INSTALLATIONS
4 main focus:a) Securityb) Costc) User friendlyd) Install. friendly
Custom design forspecific projects
STRONG R&D DEPARTMENT
ENERSA
OUR MAIN SUCCESSSOLAR STREET LIGHT
• Theft proof• hurricane proof• 12h of light per night• Fully automatic (ON/OFF) • 3 days autonomy• 25% cheaper than
imported
Designed in Haïti Solar panel made in Haïti LED light bulb made in Haïti Pole made in Haïti
ENERSA
FINANCING HAÏTI’S SOLAR REVOLUTON
Mezzanine FinancingInventory Loan$
Market segmentsfinancing mechanism
(credit / loan)$$$
Local component
supplier
Other local installers
Co
nsu
mer
Inst
itu
tio
ns
Go
vern
men
t
Manufacturing Division
Installation Division
Foreign component
supplier
Mic
ro
Bu
sin
ess
Ho
use
ho
ld
• Consumer appliances• OFF-Grid :
- Residential (SHS)- Commercial / Institutional- Stand-Alone Utilities
ECONOMICALLY VIABLE MARKET SEGMENTS
INDUSTRY STRUCTURE FLOW CHART
ENERSA
Opening solar market through
proper financing mechanism
5%
15%-20%
20% - 25%
50 % ( NOTE ABLE TO AFFORD )
Cash able
1 – 3 year credit
3 - 5 year credit
SOLAR HOME SYSTEM MARKET POTENTIAL
ECONOMICALLY VIABLE
50% penetration potential with proper financing
375,000 HH in Haïti$ 175 M market
200 M HH worldwideNeed subsidy
SOLAR NEEDS SUBSIDIES ? NO… NOT FOR ALL MARKET SEGMENTS
ENERSA
NO VILLAGE TOO REMOTE…
THANK YOU
Renewable Energy For a Better World
Our Greatest Achievement?
Changing people’s lives
COUNTING ON YOUR SUPPORT
PROFITABLE solar company, but…