Renewable Energy

Through our strategic business unit Turbine Services International, we aquire, develop, construct, and operate strategic assets for our Investors.

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Business Case:

The EU Emissions Trading System (EU ETS) works on the 'cap and trade' principle. A 'cap', or limit, is set on the total amount of certain greenhouse gases that can be emitted by the factories, power plants and other installations in the system. The cap is reduced over time so that total emissions fall. In 2020 emissions from sectors covered by the EU ETS will be 21% lower than in 2005.

Within the cap, companies receive or buy emission allowances which they can trade with one another as needed, they can also buy limited amounts of international credits from emission-saving projects around the world, the limit on the total number of allowances available ensures that they have a value. After each year, a company must surrender enough allowances to cover all its emissions, otherwise heavy fines are imposed, if a company reduces its emissions, it can keep the spare allowances to cover its future needs or else sell them to another company that is short of allowances.

The flexibility that trading brings, ensures that emissions are cut where it costs least to do so and by putting a price on carbon and thereby giving a financial value to each tonne of emissions saved, the EU ETS has placed climate change on the agenda of company boards and their financial departments across Europe.
A sufficiently high carbon price also promotes investment in clean, low-carbon technologies and in allowing companies to buy international credits, the EU ETS also acts as a major driver of investment in clean technologies and low-carbon solutions, particularly in developing countries.

Value Creation Strategy

In order to ensure the project selected has been adequately assessed, we enter the project at the Development Phase, although the Development Phase offers a Higher Risk, the outlay required is smaller and by using a sliding Milestone Investment model with investment opportunities along the scale, it allows an investor to decide when they wish to enter and leave the process.
By entering at an earlier stage, the project input areas can be changed to the final end-owner’s requirements and thus an owner specific model can be created. In order to de-risk the projects further, we only select projects that are planning approved.
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Growth Model
The goal is to develop Renewable Energy generating projects, to own and operate or sell to third parties such as utility companies, by conducting the activities required to develop a renewable energy project and assembling related development assets, it will add economic value to the projects which can be marketed to financial institutions to finance the construction of the projects or sell to third parties who desire to own and operate a renewable energy project.
If the managers decide to own and manage a project, we will coordinate and manage the project’s development activities, including securing PPAs with third party purchasers of the project’s energy production, financing agreements with qualified financial institutions who can utilise the project’s production tax credits, construction agreements and, if necessary, OEM supply agreements and other development activities as appropriate.
Upon completion of the project’s development, we anticipate that we will receive operating income from the project along with other financial benefits. We believe that the development activities and the assets will assemble a value to utilities, institutional equity investors and developers interested in meeting the demand for renewable energy created by government policies.

In making investment decisions, we will evaluate potential project returns against its internally generated rate of return guidelines and establish these guidelines by identifying a base rate of return and adjusting the base rate by potential risk factors, such as risks associated with project location and stage of project development.
We will endeavor to mitigate these risks by
(1) evaluating all projects and the markets in which we operate,
(2) selecting strategic partners with complementary skills and local experience,
(3) structuring investments through subsidiaries,
(4) managing up-front development costs,
(5) utilizing limited recourse financing and
(6) linking revenue and expense components where appropriate.


Example Project

Multiple SPV's - Single Wind Turbine Market
Single Wind Turbine Portfolio (N Ireland)
Government Support (NI)
Currently, Northern Ireland offers one of the world’s best government backed incentive schemes for the operation of medium sized, single wind turbine projects of up to 250 kW in maximum

generation capacity. The government incentivises the operation of this size of turbine by granting four renewable energy obligation certificates (ROCs) to a project for every megawatt hour generated. Combined with the electricity generated, this results in a strong revenue stream from day 1 of the projects operation. The electricity and ROCs will be sold through a PPA provider for the life time of the Project, which secures the returns to the project investors.
Government support has ceased from March 2017 and only Grace Period Projects based on certain criteria, will be awarded a 12 months extension by Ofgem.
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Value Creation Strategy (Single Wind Turbine Market NI)
In order to ensure the project selected has been adequately Assessed & De-Risked but still holds Value Creation, we enter the project at Stage 3 (as shown above), although the Development Phases offer a Higher Risk for a smaller outlay, time line constraints for these type of Projects do not permit this early stage 1 & 2 activity.
By using a sliding Milestone Investment model with investment opportunities along the scale, it allows an investor to decide when they wish to enter and leave the process, by entering at an earlier stage, the project input areas can be changed to the final owners/investors requirements and thus an owner specific model can be created.
In order to De-Risk the projects further, we only select SWTM projects at present that have (1) Full Planning Permission, (2) a Grid Connection Offer that qualifies for Grace Period, (3) Turbine Type Approved in planning & wind speed at the site fits our requirements and the (4) Development has been funded by the Land Owner to that point, we then sign agreement for a One - Off payment once the Project reaches Financial Close or an agreement for a % at time of becoming Operational and acquired by the Investor.

Present Position
We presently have a number of SPV's being placed into a SWTM Portfolio for Investors.