Movilidad educacional en México: cambio temporal

Interest in financing RE in the GCC region has been developing and some of the factors driving this interest include an existing client base, a resource base and a potential market size. A Bloomberg report by Justice in (2008) highlighted that although oil producing countries such as the GCC may not be in need for external capital to finance their local energy projects, they have a history of raising private third-party finance in areas that are being undertaken commercially for the first time at scale in the region, in this case RE.

IPPs have generally been a new phenomenon to GCC countries, with the first IPP power plant launched in 1996 in Oman, and Abu Dhabi soon following behind with a 710 MW Independent Water & Power Producer (IWPP) project. Since then the GCC countries have increasingly moved away from historical government funding of power plants towards capitalizing on the private sector’s resources. This was regarded as an alternative supply to fund the power and water needs of the region and by that freeing up government investments to be funneled into other needed infrastructure projects. With the success of IPP models in the region, it is estimated that by 2015, 34% of the total non-captive installed power capacity in the GCC will come from IPPs/IWPPs (Sarraf, et al., 2010). Although IPP frameworks have become more main stream in the GCC power sector, the model has primarily been utilized for large scale traditional power stations which meet certain dispatchability and generation requirements.

There are several reasons as to why IPP models have become popular in the region, primarily because with rapidly growing economies, pressure on governments to invest in public goods and infrastructure increases. Avoiding upfront large capital investments by amortizing these expenses over a 20-25 year period allows governments the freedom to invest in other development projects that could bring higher and more beneficial economic returns.

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Additionally, private developers bring to the table a host of sophisticated processes and business conduct that help drive up management efficiency of power plants resulting in a more competitive LCOE. Such efficiencies also improve speed and punctuality in execution resulting in a shorter time period from the moment of tendering through to the commissioning phase. Increased private sector employment opportunities and the engagement of local and international financial institutions are other indirect benefits that IPPs bring to the health of the GCC economies (Sarraf, et al., 2010).

Engagement with experienced international RE companies is one way for economies to develop capacity in the sector. Partnering with these International companies can be another way to establish an ‘in house’ expertise to develop and involve local industries. Currently in the GCC a number of projects that have partly used external private third-party finance exist, for example, Masdar in UAE, the King Abdullah University of Science and Technology in Saudi Arabia, and the development of a Science and Technology Park in Qatar.

In the UAE, RE projects have the potential to become commercially attractive for investors since it will be straight forward for RE to build on or adapt to the well-established frameworks in the conventional power industry, including tendering processes for IPPs. In addition the sector is attractive because of security due to the guaranteed long term PPAs by the governments where all utility companies and grid or distribution systems are available and owned by the government (Hamilton, 2011). The first IPP model for a RE plant is the 100 MW solar thermal Shams 1 project in Abu Dhabi (Quick, 2015).

In the following section, Abu Dhabi’s Shams 1 solar IPP contractual framework is reviewed to help conceive a solar IPP structure specifically for Dubai’s market and its local stakeholders.

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Figure 11 Shams 1 project structure (Goebel, 2012)

Figure 11 shows the breakdown of the contractual agreements and stakeholders involved in Shams1. The key stakeholders in this structure are as follows:

1. Shams Power Company, in this case the SPV or Project Company, will sell the generated electricity to Abu Dhabi Water & Electricity Company (ADWEC). Shams Power Company holds 20% equity of the project out of which 60% of equity comes from the Abu Dhabi Future Energy Company (ADFEC) and 40% comes from Total Abengoa Solar. The remaining 80% is bank financed.

2. ADFEC signs a Land Agreement with Shams Power Company.

3. An Operation and Maintenance (O&M) Agreement between Shams Power Company and Total Abengoa Solar.

4. A Connection Agreement between Shams Power Company and Transco. Transco is the transmission company of Abu Dhabi, in other words the grid operator.

5. A PPA between Shams Power Company and Abu Dhabi Water and Electricity Company (ADWEC), the sole off-taker of electricity and water in Abu Dhabi.

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6. A Green Payment Agreement between Shams Power Company and Department of Finance by which the Department of Finance pays the premium for each kWh over and above the traditional kWh that ADWEC pays today for traditional fossil fueled power.

7. A Gas Supply Agreement between Shams Power Company and Abu Dhabi National Oil Company. 8. An Engineering, Procurement and Construction (EPC) Agreement between Shams Power

Company and Abener/Teyma Joint Venture.

The Shams 1 project in Abu Dhabi modified the traditional PPA most commonly used in Abu Dhabi to incorporate the “take-or-pay”/non dispatchable characteristic of a solar plant (Nash & Kersey, 2012) (as was covered in Section 2.5.2). The PPA terms stipulate that all electricity produced must be purchased by the off taker (Goebel, 2012).

The literature review so far investigated the drivers for the global and regional need for RE. The literature review also discussed the main components that are the most important enablers of RE deployment especially in the UAE. These components can be grouped under three categories. First is the choice of technology based on the energy source, second is the policies and regulations and third is the funding and financing.

Furthermore, in the UAE context the review conducted highlighted that private sector involvement is limited to supply side. To be able to address the research question, the following section will draw upon business model literature to understand the components of a successful business model and to help explore the possibility of conceptualizing a business model that could introduce the private sector to pay for the difference between the cost of solar and the cost of conventional power.