Sustainable Energy Thematic Session

Brief Presentation by Clifford Chance, Atkins Acuity and INGConference: SFC Asia Launch EventSingapore, 22 November 2016

November 2016

Energy Efficiency and Renewable energy projects are key to reduce GHG emission in Asia

41.4% Of the total investment needed are in the power

sector (2013-2020)

34%

17%

Source: IEA, World Energy Outlook Analysis

SolarWindBiomass and W2E

Renewables

Energy Efficiency

BiofuelsSmall hydro GeothermalMarine

Renewable energy

Energy Efficiency

To avoid 3 degree of global warming, the following measures should be implemented in Asia

by 2020…..

Energy savingBuilding retrofittingGreen BuildingTransport

Energy StorageMethane reduction

Inefficient coal plants

Fossil-fuel subsidies

Buildings have a large impact on the environment…

3

40% of global energy use

60% of total electricity consumption

1/3 of global GHG emissions

25% of global water consumption

40% of global resources

Source: UNEP

With population growth and increasing urbanization, this will only get worse unless action is taken

4

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H2 Building, Tianjin, China

Green building activities in the future

0%

10%

20%

30%

40%

50%

60%46%

38% 37%27% 25%

55%

40%

19%13%

45%Global

Planned green

activity over the

next three

years*

20% of construction cost 30% energy consumption 35% in Carbon emissions

7 years projected investment recovery period4 Million Yen estimated operations cost savings per annum

*Source: Word Green Buildings Trends 2016

November 2016

Promising Renewable Energy Market (e.g. ASEAN)

Brunei

Cambodia

Indonesia

Laos

Malaysia

Myanmar

Philippines

Singapore

Thailand

Vietnam

RE Target Selling Tariffs Incentives Financing Support Permits and Licenses Technical Aspects

Target share of renewable energy up to 50% and triple renewable energy generation capacity to 15GW by 2030

Philippines

Target share of renewable energy from < 5% to 25% by 2025

Indonesia

No declared renewable energy mix target but aims for 350MW of solar installations on public sector rooftops by 2020.

Singapore

Target share of renewable energy from 6% in 2015 to 11% by 2020

Malaysia

Target share of renewable energy up to 25% by 2022

ThailandTarget share of renewable from 3% in 2010 to 5% by 2020 and 11% by 2050.

Vietnam

Source: ACE – ASEAN, Eco-Business

November 2016

SFCA - Extended Renewable Financing Platform

Nam Theun 2 1070MW HydroLaos

EDC Burgos150 MW WindfarmPhilippines

Sarulla330 MW GeothermalIndonesia

IP5WTE

Singapore

Nagi13 MW Solar PVJapan

SFCA ConsiderationsSmall and large deals

Realistic development periodPositive E&S impactFocused bank groupBespoke Structure

E-submission

SFCA is complementary to conventional project financing. Taking into account the above considerations, SFCA intends to accelerate, collaborate, shaping, digitalize the fund raising for sustainability deals in the region

ING’s conventional financing in Asia

November 2016

Bankability, risk allocation considerations remain important

Gov’t Suppor

t

Tariff levels and

currency

Supply vs

Demand

GFM and terminat

ion regime

Land/ Right of

Way

GFM and terminati

on regime

Technical, E&S, EPC, O&M

Fuel availabili

ty

KYC, CDD

DSCRs and IRRs

STAKEHOLDERS

• OFFTAKER

• GOVERNMENT

• SPONSORS

• BANKS

• ECA / DFIS

• CONTRACTORS

• OPERATORS

November 2016

Zoom on energy storage – an increasingly bankable asset

Clifford Chance’s energy storage experience

Lakeland Solar & Storage Project, Nth Qld

•13 MW PV with 5.3MWh/1.4MW LI battery

• Australia’s first grid-connected, utility scale solar and storage project

Redstone, RSA

•100MW CSP tower

•molten salt storage of up to 12 hours

Enhanced Frequency Response, UK

•200MW of EFR; four year contracts

•Acting for a leading technology provider

Proponents will benefit from the global experience of Panel members, which will be important for the financing of newer technologies

Energy storage

Drivers

•Intermittency issues

•Ancillary services revenues

•Price arbitrage

•Grid cost savings

•Decentralization

•Costs falling rapidly

•Off-Grid applications