16
Due Diligence
Due Diligence
contents01/ introduction
02/ overview
03/ due diligence
04/ project experience
05/ worldwide offices
06/ supporting information
teessidewind farm
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Natural Power is an independent renewable energy
consultancy and services provider with over twenty
years of in-house project experience. We provide
expertise at every stage of the project lifecycle: from
feasibility, development, pre-construction, construction,
operations to re-powering, and through all elements of
due diligence.
Natural Power’s 360° lifecycle experience spans more
than 800 projects, with a team of over 340 experts. Our
approach to consultancy services allows us to focus on
reducing interface risk and working smarter from day
one of your power project, through:
→ The application of pioneering new technologies, methodologies and best practices to tackle the most complex and challenging issues
→ The provision of project management experience delivering both practical and innovative consulting
→ Building wide and lasting relationships with our clients, who then benefi t from our full lifecycle experience at every stage of their project
→ Providing trusted, impartial due diligence services to fi nancial investors that equal the breadth of services off ered to development clients
introduction01/
analysisservices
permittingsupport
340+renewableenergypeople
11offi ces
worldwide
21years industryexperience
155 operational assets
managed
projectsconstructed
112+
due diligenceportfolio
environmental services
80 GW+
7 GW
25 GW+
47 GW
our mission and vision:to create a better environment by providing market leading advice and services to our clients
Stephen Trotter, Managing Director
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overview02/
Re-Powering
Construction
Feasibility
Development
Pre-Construction
Operations
Our Due Diligence (DD) experience spans more than 200 projects and portfolios, with a team
of over 50 due diligence specialists working as part of a 340+ strong company.
Our lifecycle approach to consultancy services is unparalleled within the market, allowing us to
focus on reducing interface risk and working smarter from day one of your project.
Our clients include major international banks, developers, Independent Power Producers (IPPs),
utilities, investment funds and other financial institutions.
Natural Power routinely performs detailed technical DD across a number of different transaction
scenarios:
→ Project finance debt transactions, where we fulfil the duties of Lender’s or Owner’s Independent Engineers / Technical Advisors, from pre-finance technical DD to project commissioning and handover
→ Merger and Acquisition (M&A) transactions, often containing a mixture of operating, pipeline and pre-construction assets, where Natural Power perform technical DD duties on behalf of the acquirer or on behalf of the vendor
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due diligence03/
03.1/ Our experience
Our DD services are available globally, and to date have included projects in the US, France,
the UK, Ireland, Finland, Sweden, Canada, Romania, Chile, Romania, Turkey, South Africa and
many more.
We deliver technical due diligence work on the following renewable energy technologies:
→ Offshore wind
→ Onshore wind
→ Solar PV
→ Renewable heat
→ Hydro
Advice based on real-life experienceNatural Power’s extensive record of designing, delivering and operating renewable energy
projects on behalf of our clients gives us a true lifecycle perspective as to what makes a
successful project; we apply this experience and perspective when performing due diligence, to
the benefit of our clients
Established credibility & trustOur industry experience, reputation and proven technical expertise means that our clients see
us as a highly credible supplier of technical DD services. Our extensive list of clients in the
financial sector trust us to identify technical risks and to translate them into the context of their
transaction. We always strive to solve and mitigate project risks, allowing our clients to make
confident and informed investment decisions. We are proud to be a key partner to our DD
clients, assisting them in achieving their investment ambitions
our team of 50 due diligence specialists has worked across over 200 projects worldwide, giving us unparalleled experience of a range of transaction scenarios
Giles Dearden, Director of Due Diligence
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resource mapping
Flexibility and resourcesWe have a broad team of technical experts across our business that are ready to help with
your DD projects, on what are typically short timescales and demanding schedules. We have
technical DD delivery resources based in the UK, France, the US, Ireland and Scandinavia that
afford us substantial flexibility and adaptability and that provide a central point of contact
for clients to ensure stream-lined delivery. Our offices in London, Paris and New York State
place us close to the powerhouses of renewable energy financing, allowing us to stay in close
communication with you and your transaction teams.
Clarity of reportingWe understand that the process of due diligence is one of translating technical risks and issues
into potential project impacts. Our reports seek to do this clearly and concisely, by way of
colour coded risk identification, taking full account of the severity, likelihood and consequent
impact of material issues. This risk focussed approach allows us to quickly and clearly convey
findings to you, and is backed with fully referenced technical reporting.
We understand project riskWe understand the need for translating what are often highly technical issues into language
that can be fully appreciated by a non-technical audience. Our senior DD personal and project
managers work closely with our clients to ensure that risks are kept in proportion, and that
we communicate in such a way that we can present risks, and opportunities, in the context of
your transaction. This allows us to maximise the value of our advice and to assist in developing
transaction strategies and tactics as required.
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broxted solarfarm
Working with the whole transaction teamWe know that technical DD does not stand in isolation, and that there are a wide range
of technical issues and considerations to be taken into account when undertaking a project
transaction. We form effective working relationships across your project teams to understand
the wider commercial, legal and financial implications. This allows us to continually present our
finding in the context of your project, ensuring its integration with other advisors’ scopes of work
so that they are effectively managed and communicated.
Comprehensive scope of worksWe have the required skills, resources and experience to fulfil the full scope of works for a
technical due diligence, including:
→ Energy Yield Analysis (EYA) and Plant Performance Analysis (PPA)
→ Project design and technology certification
→ Asset integrity inspections
→ Permit, lease and conditions review
→ Environmental impact review
→ Contract and warranties review
→ Costs analysis and benchmarking
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feasibility and development
reviews
03.2/ Risk management for key agreements and contacts
Risk management is one of the key elements in any commercial investment such as renewable
energy projects. Risk issues such as contracts, contractors, plant and insurance can be
managed correctly and appropriately to mitigate risks away from investors and lenders,
reducing the costs of financing renewable energy projects.
Investors, lenders and project owners are naturally cautious towards any element of project
agreements risk that may lead to unexpected negative fluctuations in a project’s cash flows or
value. Therefore there is a fundamental requirement to manage risk in a way that mitigates any
occurrence that could give rise to a negative financial impact on the project.
Natural Power has a unique insight into the full lifecycle of renewable energy projects having
designed, permitted, constructed and now operating many GW of plant for a mixed base of
clients with differing attitudes to risk.
This insight allows us to reduce and manage the key risks associated with project agreements
which include, but are not limited to:
→ Planning and permit conditions
→ Environmental risk management, particularly with regards to ecological and hydrological risks
→ Engineering, Procurement and Construction (EPC) Contracts
→ Warranty, operations & maintenance agreements
→ Turbines supply agreements
→ Grid connection agreements
→ Power Purchase Agreements (PPA)
→ Tax credits and Subsidy Schemes
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03.3/ Feasibility and development
Considerations towards the following criteria are made when assessing the work undertaken in
the planning phases of a renewable energy project including:
→ Planning permit review, including comment on condition discharge in the form of a high level timetable for completion of remaining conditions with highlighted potential hold-ups or reliance on third parties
→ Land agreement(s) review with specific comment on potential construction risks and economics of these agreements
03.4/ Finance-grade Energy Yield Assessment (EYA) Analysis
Natural Power is an established and trusted provider of technical resource due diligence studies.
Through our consistent focus on technical innovation including pioneering the development and
use of wind farm design and optimisation software, advanced flow modelling and operational
experience, we are well placed to address project risk and to offer expert advice and unique
solutions. We routinely apply our resource and site assessment expertise to provide finance
grade energy yield analyses and site classification reports to a variety of clients including
developers, utilities, financial institutions, vendors and prospective investors. Our services are
relied upon by leading financiers across the globe.
→ Our rigorous procedures ensure a consistent and singular approach to analyses across the international teams. All technical wind engineering work undertaken by Natural Power is carried out in accordance with a detailed quality management system (QMS), which is ISO 9001:2008 certified.
→ We are experienced in both development and operational phase energy assessments. Our wind farm experience includes a wide variety of terrain and site types including thermally driven wind regimes, complex terrain, forestry and offshore projects. Furthermore, we are experienced in all scales of projects, from single turbines to 1GW+ renewable energy projects both onshore and offshore
→ Resource and energy yield aspects of a due diligence commission typically take one of two courses:
→ Where energy yield reports are available these will be scrutinised with respect to quality of data inputs, the use of traceable and verified methodologies and adherence to recognised industry best-practice
→ Where the available report(s) are not found to present suitably robust estimates of the Annual Energy Production (AEP), a rigorous assessment of the site resource regime and energy production of the proposed wind farm can be undertaken to provide robust estimates from available raw resource and/or production data
→ We work with our key established partners to provide finance-grade solar PV resource predictions, energy yield analyses and technology, and can provide solar resource studies on a global basis through the application of a proven and verified technology platform, in addition to detailed expert solar technology and design advice
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03.5/ Environmental
A detailed review of the ecological and hydrological requirements of the projects is undertaken.
The review focuses on project risk management and includes the following key considerations:
→ Review of the planning consent condition requirements
→ Review of any documentation to discharge planning consent conditions to ensure it is compliant with condition requirements, legislation and guidance
→ Assessment of cost implications associated with the planning consent conditions for Capex and Opex financial models
→ Review of the potential implications that the planning consent conditions may have on the construction and operation programmes/timelines
→ Ensure that all licence/permitting requirements associated with the planning consent conditions are in place when required
→ Review of post-construction monitoring requirements of the planning consent conditions, to ensure that they are appropriate, fit for purpose and to outline when and how long monitoring will take place
03.6/ Constructability
A detailed review of the ecological and hydrological requirements of the projects is undertaken.
The review focuses on project risk management and includes the following key considerations:
→ Review of the planning consent condition requirements
→ Review of any documentation to discharge planning consent conditions to ensure it is compliant with condition requirements, legislation and guidance
→ Assessment of cost implications associated with the planning consent conditions for Capex and Opex financial models
→ Review of the potential implications that the planning consent conditions may have on the construction and operation programmes/timelines
→ Ensure that all licence/permitting requirements associated with the planning consent conditions are in place when required
→ Review of post-construction monitoring requirements of the planning consent conditions, to ensure that they are appropriate, fit for purpose and to outline when and how long monitoring will take place
03.7/ Finance review and Scenarios analysis
Reviews are conducted of technical inputs to the financial models, including use of EYA
production assumptions, estimated turbine supply and Balance of Plant (BOP) contract costs,
management and ancillary costs, contingency sums for the construction budget, O&M cost
estimates and recommendations.
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construction project
management
Client Year Project Services
2013-14 Project Clover: operational 316 MW Offshore wind farm
Provision of full vendor’s technical DD package
2013Bord Gáis M&A: operational 200MW onshore wind portfolio
Provision of vendor’s technical DD package
2013-14Finnish portfolio M&A: pre-construction 100MW onshore wind portfolio
Buyer’s technical DD, resource analysis, Owner’s Technical Advisor
2014Wind/solar portfolio: operational 10MW wind and solar portfolio refinancing
Technical DD review on behalf of the lender
Confidential 2014-15 Project Clover: 3 project, 80 MW onshore wind portfolio
Full technical DD review on behalf of the prospective purchaser
2014 16 MW onshore wind project Full technical DD review on behalf of the purchaser
Confidential 2015 European wind/solar portfolio: operational 400 MW
Provision of full vendor’s technical DD package
2015 Neart na Gaoithe: consented 400 MW offshore wind project
Provision of full vendor’s technical DD package
Confidential 2015Project Ocean: pre-construction 1,428MW offshore wind portfolio
Buyer’s technical DD, resource and costs analysis on behalf of the prospective purchaser
Confidential 2015UK onshore wind portfolio: operational yield assessments for refinancing of 7 sites
Technical DD review on behalf of the sponsor with reliance to the lender
2015 Harburnhead: 60MW onshore wind site
Full technical DD review on behalf of the prospective purchaser
project experience04/
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craigengeltwind farm
Natural Power delivers services and operates assets globally for our clients, with eleven offi ces
across Europe and North America and agencies active in South America and Asia Pacifi c.
worldwide offi ces
USASaratoga SpringsSeattle
SCOTLANDCastle Douglas (Global HQ)StirlingInverness
ENGLANDNewcastleLondon
IRELANDDublin
WALESAberystwyth
FRANCE
NantesParis
TURKEYAnkara [Agency]CHILE
Valparaiso [Agency]
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Natural Power delivers services and operates assets globally for our clients, with eleven offi ces
across Europe and North America and agencies active in South America and Asia Pacifi c.
worldwide offi ces
USASaratoga SpringsSeattle
SCOTLANDCastle Douglas (Global HQ)StirlingInverness
ENGLANDNewcastleLondon
IRELANDDublin
WALESAberystwyth
FRANCE
NantesParis
TURKEYAnkara [Agency]CHILE
Valparaiso [Agency]
05/
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supporting information
Health & SafetyNatural Power operates a Safe System of Work procedure, this procedure outlines the
requirements and guidelines required for safety in the workplace and mitigation of risk.
Health & safety is the number one priority for Natural Power both from an operational and
management point of view. The safety of our staff , contractors, and the public must come
before any technical or commercial considerations.
In accordance with statutory requirements, for all routine and non-routine activities undertaken
by employees and others working on behalf of Natural Power, a risk assessment must be
undertaken and suffi cient controls introduced to manage the risk. Method statements are
activity specifi c and are prepared where their absence would adversely aff ect the ability to
exercise the controls identifi ed by risk assessment.
The ControlCentre is an industry leading innovation providing 24/7 monitoring and
communication services through trained operatives in our control room, ensuring our fi eld
staff have round the clock access to log on and off of the remote / lone working system. This
combined with our hand-held SPOT devices ensures staff members working in the fi eld have a
safe environment to operate in.
QualityNatural Power has established rigorous procedures and work instructions for all aspects of our
business. All staff currently work to a list of core procedures for quality control and business
management as part of our on-going commitment to our Quality Management System (QMS).
A totally integrated project management system is used throughout all departments, that
includes fi le tracking and back-up along with resource management, document checking and
authorisation, providing a full audit trail for all documents and project activities.
All data and reports are subject to a minimum two stage quality assurance process in line
with ISO 9001:2008 procedures where documents are produced by a technical specialist then
checked by another specialist before being checked and approved by a senior manager,
ensuring a consistently high quality output to clients at all times.
Our asset management, construction and ecology management group, technical services and
development consultancy services have all achieved the ISO 9001:2008 certifi cation and Achilles
Verify Category B2. Full details of our QMS are available on request.
06/
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EnvironmentNatural Power has internal goals with regards to environmental practice relating to energy
use, carbon footprint reduction and recycling. We have had an Environmental Management
System (EMS) in place since 2001 and have progressed our EMS to an integrated Quality and
Environmental Management System and now hold ISO 14001:2004 certifi cation.
All policies and arrangements are reviewed on an annual basis by our Quality and
Environmental Manager and the management team.
The processes required for the Quality and Environmental Management System, their sequence
and interaction have been identifi ed along with the criteria and methods required to ensure
their eff ective operation and control. All subcontractors would be expected to work to the
Natural Power Environmental Policy Statement; evidence of this is required on appointment.
Before each project commences an environmental risk assessment is carried out covering all
aspects required for the scope of work.
Disaster recoveryNatural Power recognises the need for our clients’ projects to have robust systems and
processes in place to ensure that data, documents and key staff continuity are retained in the
event of a major incident.
Natural Power’s electronic Document Management System ensures that project documents are
stored in a secure and ordered location on a central server which is backed up regularly to
off -site storage.
All emails are archived in a cloud based system which allows recovery of deleted mail and
also provides email continuity in the event of a failure of Natural Power’s servers or internet
connection.
Hard copies of key documents are stored in a fi reproof safe.
Multiple offi ce locations assist in provision of continuity in the event of a major incident, such as
fi re, aff ecting any particular location.
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what we do
→ Leading independent renewable energy consultancy
→ Analysis, engineering, planning & permitting, environmental, project management and due diligence services
→ Onshore wind, off shore renewables, solar, hydro, renewable heat and grid & infrastructure
→ Established in 1995, 11 offi ces globally, 340+ staff
No part of this document or translations of it may be reproduced or transmitted in any form or by
any means, electronic or mechanical including photocopying, recording or any other information
storage and retrieval system, without prior permission in writing from Natural Power. All facts and fi gures correct
at time of print. All rights reserved.© Copyright 2017.
For full details on our ISO and other certifications, please visit: naturalpower.com/company
