HYDROPOWER CONFERENCE FOR SUSTAINABLE DEVELOPMENT 2011 Financing a Regional Hydropower Project as a PPP (BURUNDI, DRC & RWANDA) THE RUZIZI III PROJECT - 145 MW Presented by: Ir Claude KAYITENKORE, Energy Director of EGL ADDIS ABABA, 31 MARCH- 01 APRIL 2011.
1. INTRODUCTION CONTENTS 2. RUZIZI III PROJECT STRUCTURE 3. RUZIZI III PROJECT PPP STRUCTURE 4.OVERVIEW OF FINANCIAL ASPECTS OF RUZIZI III PROJECT: Equity,Debt, Financing Plan, Risks and Tariffs. 5. CURRENT STATUS AND PERSPECTIVES OF THE RUZIZI III PROJECT 6. PARTNERS 7. RECOMMANDATION HYDROPOWER FOR SUSTAINABLE DEVELOPMENT 2011 - The RUZIZI III Hyropower 2
1. INTRODUCTION Entity in charge of promoting the Project: EGL, a specialized entity in charge of Energy of the Economic Community of the Great Lake Region CEPGL(Burundi, DRC and Rwanda. 3
Geographical Situation of the Project 4
Components Ruzizi I ( rehabilitation) 28 MW ( 21 MW) 1958 Snel -DRC Ruzizi II ( rehabilitation) 44MW -1989 SINELAC ( Burundi, Rwanda, DRC) Construction RUZIZI III - 145 MW- IPP (PPP) Comprehensive costs of the Ruzizi cascade Project USD Total 401 423 100 Financing Source 8 618 400 Ruzizi III Project 18 409 700 Ruzizi III Project 374 395 000 Ruzizi III Project 5
Management of Lake Kivu Water Management Marketing Purchase of Water Rights Dispatch Heavy Maintenance M Projet Company 2. RUZIZI III PROJECT STRUCTURE Ruzizi I Ruzizi II Ruzizi III Ruzizi IV Operation SNEL Treaty Water Basin Management Coordinating Entity Operation SINELAC Operation RUZIZI III Operation RUZIZI IV 6
International Reservoir Multiple Water Uses Optimizing the Operation Financing Why this structure? A Treaty for water management A water basin management Authority for Lake Kivu A Coordinating Entity for all the Plants Structure the Project as a PPP
Lenders Operator 4. PPP STRUCTURE OF RUZIZI III PROJECT Loan Agreements O&M Contract Shareholders Shareholders agreement Ruzizi III EPC Contractor Concession PPAs Power Companies Governments 8
The Stakeholders are : The Stakeholders EGL: Responsible for the project ; The countries granting the concessions ; Ruzizi III Project Company (the Concessionnaire) ; National Regulatory Entities ; Lake Kivu Basin Authority. HYDROPOWER FOR SUSTAINABLE DEVELOPMENT 2011 - The RUZIZI III Hyropower 9
Investors 70%+ IFI (SFI, Proparco) <15% The Equity IFIs Governments 30% - Ruzizi III Project Company Power Companies 10
Internat. Instit. Governments 102 m 100 m The Debt IFC, Proparco.. 80 m Ruzizi III Project Company Commercial Banks 60 m HYDROPOWER FOR SUSTAINABLE DEVELOPMENT 2011 - The RUZIZI III Hyropower 11
Source Financing (US$ M) Project Financing Plan Cost (US$ M) Cost (MEURO) HYDROPOWER FOR SUSTAINABLE DEVELOPMENT 2011 - The RUZIZI III Hyropower Purpose Trust Fund 8 12 9 Preparation Developer 4 Capital 135 386 291 Ruzizi III Engineer IFI to Gov. 102 64 48 Financing costs and reserve accounts IFI to Projet 100 9 7 Rehab. Ruzizi I SFI, Proparco 80 18 14 Rehab. Ruzizi II Commercial Banks 60 IFIs to Gov. 92 92 69 Transmission Total 581 581 437 12
Completion Market Production Main risks of Ruzizi III Project ( to be negociated ) > Investors Governments Inflation and interest rates Local Inflation Hard currency Exchange rate Political Force Majeure HYDROPOWER FOR SUSTAINABLE DEVELOPMENT 2011 - The RUZIZI III Hyropower 13
0.2500 0.2000 0.1500 0.1000 0.0500 - Purchase Tariffs PurchaseTariffs from the Plants : RI $US: RII $US: RIII $US: USD / KWH 0.029/kWh 0.043/kWh 0.108/kWh Tariff - Ruzizi I Tariff - Ruzizi II Tariff - Ruzizi III 14
5.CURRENT STATUS AND PERSPECTIVES OF THE RUZIZI III PROJECT Feasibility study has been completed in May 2010 ; Detailed specifications and tender documents of the hydroelectric power plant Ruzizi III ( completed in March 2011) ; The final report of the ESIA will be presented at the end of April 2011; The institutional and financial arrangements studies of the project will be completed at Mid- May 201; The recrutement of the Project Advisor and the prequalification process of the Investors /Developers are on going ( Mid-May 2011) ; Financial Roundtable : juin 2011 Financing closure: 2011 Mid 2012; Start of the construction : Start 2013; Commissionning : 2017. 15
6. PARTNERS French Development Agency African Development Bank European Investment Bank World Bank Group KFW FMO European Union Austrian Cooperation Agency 16
7.RECOMMANDATION THROUGH THE THREE COUNTRIES OF THE GREAT LACS REGION, EGL CALL UPON ALL INVESTORS AND DEVELOPERS TO TAKE THE OPPORTUNITY TO INVEST IN THE DEVELOPMENT AND THE CONSTRUCTION OF RUZIZI III REGIONAL HYDROPOWER PLANT. THE DATA ROOM DOCUMENTATION IS BASED ON THE FOLLOWING WEB SITE: www.egl-echanges-energetiques.net/ruzizi-iii THE TENDER DOCUMENTS FOR THE FOLLOWING HAS BEEN ANNONCED : 1. RFP OF THE PROJECT ADVISOR ( preparation of tender documents, selection of prefered investor/developer on a minimum rate of return on equity, contracts negociations, financing closure etc ) 2. PREQUALIFICATION ( RFQ) OF THE INVESTORS /DEVELOPERS Development, financing, construction and operation of Ruzizi 3 ( 20 years or more ) ; Heavy maintenance of Ruzizi 1 &2; Optimization of Ruzizi River Cascade. 17
Thank You! 18