Sino-Danish Renewable Energy Development Programme (RED) Proposal Preparation Package China National Renewable Energy Center (CNREC) March 1, 2012 Beijing 1
Call for Proposals Support to Danish-Chinese cooperation in the field of renewable energy Call for Proposals No.: RED-C2-2012-1 Implementing Organization: CNREC The Sino-Danish Renewable Energy Development Programme 1 is now ready to support joint Danish-Chinese cooperation on the research and development of renewable energy technologies. The support scheme was launched on 23 February 2012 and it is open for proposal from partnerships established between Chinese and Danish research institutions, universities and enterprises with a view to undertaking joint innovation/r&d in RE technology. The support scheme has a total funding capability of 30 million DKK. In general the scheme will only be able to support part of the total cost of the cooperation project additional funding from the involved organization is required. The following technology areas will have high priority for the support scheme: Wind energy: - Off-shore wind power: resource assessment and special issues regarding offshore wind farm in China - Testing of wind turbines with focus on large wind turbines Bioenergy - Biomass resources, mapping, sustainability, availability - Biofuels development and demonstration - Biomass for CHP, demonstration - Biogas demonstration 1 The Sino-Danish Renewable Energy Development Programme (RED), developed by the Government of China and supported by Government of Denmark, is established to providing assistance with institutional capacity building in China and renewable energy technology innovation in China. The Programme consists of two components, which are Component 1 focusing on establishment of China National Renewable Energy Center (CNREC) and Component 2 focusing on investment and technical assistance. 2
Solar Energy - Solar heating for district heating systems - Testing of solar panels Integration of renewable energy into the energy systems - RE planning on provincial and city levels - District heating as an integrator of RE - Institutional barriers and solutions to integration of RE - RE and smart grid set-up. Furthermore priority will be given to projects demonstrating: - A strengthening of on-going or new cooperation between Chinese and Danish companies and institutions - A good likelihood of a continued cooperation beyond the current project - Innovative development and/or use of renewable energy technologies within the priority areas - Technical and economic feasibility with a high probability for success - Capacity building for involved partners. Partnerships that want to use the support scheme should submit a proposal to China National Renewable Energy Centre (CNREC), which manage the scheme for the Danish Embassy in Beijing. A template for the proposal and further guidelines for application are available at the web sites of the RED Programme, www.cnred.org.cn, and the Danish Embassy, www.kina.um.dk. There is no fixed deadline for submission of proposal. Proposals will be evaluated on an on-going basis as long as funding is available. Further calls for proposals might be issued if necessary to cover the whole range of priority areas. Get further information about the support scheme from Ms. Han Cuili at hancuili@cnrec.org.cn 8610-63908086-105 Mr. Kaare Sandholt at ks@cnrec.org.cn 8610 6390 8295 3
List of Contents A. Standard Application Form----------------------------------------------------5 B. Application Instruction---------------------------------------------------------7 4
A. Standard Application Form 1. The project a. Title b. Technology area (select one) Wind energy Bioenergy Solar energy Integration of renewable energy into the energy systems c. Project type (select one) Minor research project Demonstration project d. Project purpose e. Project budget f. Other funding programs 2. Proponents a. Main proponents introduction (including the below mentioned aspects) Registration in China/Denmark, respectively Ownership of the company/institution Financial base (include the last 2 years Annual financial Reports) Key staff within the proposed field of cooperation, personnel resources in the organization, background for international involvement and track-record in the sector Number of years of experience within this type of cooperation (Danish proponent only) Systems in place to register and account for the costs of the proposed project b. Project manager c. Other participants 3. Summary a. Executive summary b. Time schedule 4. Technology a. Description of the technology and its development towards the market b. Project content and activities c. Distribution of rights 5. Objectives a. Objectives b. R&D strategies c. Dissemination of results 5
6. The Market a. Target group and added value for the users b. Competitors c. Market potential d. Market strategy 7. Organization and Financing a. Organization, managing, human capacity b. Financing c. Public/private partnership and education/capacity building of researchers d. Investments and operational budget in the project period e. How will the grant help the project objectives 8. Research (Danish background, Chinese background referring to the proposed project, the cooperation necessity and feasibility, etc.) 9. Annexes 6
B. Application Introduction 1 The Sino-Danish Renewable Energy Development Programme (RED for short) is jointly developed by the Chinese and Danish governments. It is aimed at institutional capacity building and technology innovation for renewable energy development. The agreement between the governments of the People s Republic of China and of the Kingdom of Demark regarding Renewable Energy Development (RED) was signed by the Ministry of Commerce, P.R. China, and the Royal Embassy of Demark on December 2008. The funding by the Danish government totals 100 million Danish Kroner (DKK, equivalent to about 130 million RMB). The National Energy Administration, P. R. China, is the national executing agency. 2 RED programme includes 2 Components. The objectives of Component 2 have been defined in the RED Programme Document from September 2008: Objective 3 The immediate objective of Component 2 is that Danish-Chinese institutional and business partnerships are in place to cooperate on further development of RE technologies in China. This is to be achieved by undertaking market analysis of potential areas for Danish-Chinese cooperation in RE and subsequently providing grants to partnerships established between Chinese and Danish research institutions, universities and enterprises with a view to undertaking joint innovation/r&d in RE technology. 4 The Component 2 of the RED Programme will address GOC s plans and priorities with regard to RE technology development and GHG policies and targets by advancing the introduction of RE technologies and strengthening the Chinese R&D capacity in this field. Denmark is recognized as being at the forefront in a number of RE technology areas including their application. Transfer of and collaboration within these RE technology fields will bring advanced Danish technologies into play in China, which will assist China in attaining its RE goals. 5 At the same time, the component 2 will open a window of opportunities of Danish research institutions, universities and business firms for expanding innovation cooperation activities as well as developing knowledge and market base in China. This, in turn, will contribute to strengthen Denmark s advanced position in RE technologies and to developing RE-related business in China. R&D cooperation between the two countries will also pave the way for China s integration into international technology cooperation in the RE area and contribute to the foundation for exchange of RE students between China and Denmark. 6 The component will support R&D institutions, universities and business enterprises in 7
Denmark and China by bringing them together in the form of partnership primarily to support one another in the applied R&D part of the innovation chain. The Programme will focus on emerging, innovative technologies for which the potential for commercialization is considered high, i.e. there has to be a potential market application in sight within a time horizon of 3-5 years, allowing concrete results to be produced during the Programme implementation period. Funding and successful implementation of cooperation projects such as RE development as well as pilot and demonstration projects are expected to create recognition of the important role that the CNREC (covered by Component 1) will play in instigating technological developments. Hence, Components 1 and 2 are closely interrelated. Requirements to the Application 7 For preparing the proposal, eligible entities (proponents) must use a standard format (Standard Application Format) prepared and issued by the CNREC. The proposals will be evaluated according to the turns they are received, and if the proposals are approved, they can get support from the program. The total budget for this call for proposals is 30 million DKK. The Embassy will enter into a contract (Sub-Grant Agreement) with proponents of selected projects. The approved proposal will form an integral part of the contract. 8 The budget of the application is recommended to be in DKK at least as to the costs related to the Danish Proponent, as the contract/sub-agreement to be signed by the Royal Danish Embassy (RDE) will be in DKK. 9 Regarding VAT and exchange rate: All Danida funding under the RED Programme is exclusive of value added tax (VAT). The exchange rate used for reference to the equivalent amount in currencies of the DKK contract value is fixed as the exchange rate published by Danske Bank on the day of signing the contract. When the RDE makes bank transfers to the contract holder, the exchange rate to be used will be the one used by RDE on the day of transfer. Any fluctuations of the exchange rate must be borne by the contract holder. Activities that can be supported and Size of projects 10 Minor research projects and pilot demonstration projects are to be supported. Minor research projects are projects jointly carried out by Chinese and Danish companies in order to clarify research topics, further basis for cooperation, the feasibility of demonstration projects, market investigation etc. within the priority areas. The projects do not have any construction as part of the implementation. Grant support provided by the minor research projects will be limited to a maximum of 80% of the total project cost of the project value with a maximum of 1 mill. DKK. The remaining costs of the project value should be covered by the project Proponent. 8
11 For pilot demonstration projects for R&D, including construction, engineering works, etc., the grant provided will be limited to 50 per cent of the project cost. Activities that can be supported: actual investment, but also include more upstream support like technical studies, development of standards or strengthening of existing renewable energy centers. In their proposal the proponents need to make clear how the proposed project will lead to or contribute to demonstration of renewable energy technologies. 12 The proposals will be prepared by the recommended proponent and evaluated by the CNREC staff. The minimum demonstration project value is 2 million DKK (smaller proposals cannot be considered as this could lead to too many small projects). No maximum project value is established for the demonstration project proposals, but the maximum grant for each project will be 8 million DKK. The project proponent should cover the remaining cost of the project value. 13 Pilot demonstration projects contribute to providing information that is not known or in insufficient detail. Pilot demonstration projects contribute to scaling-up when the projects increase the interest for the renewable energy technology demonstrated and when these projects can be replicated. Associate for support 14 Companies and institutions in China and in Denmark are required to associate for support. Each proposal should have at least one main Chinese proponent and one main Danish proponent. Additional sub-contractors are allowed. The Embassy will sign the Sub-Grant Agreement with one representative of each main proponent. Eligible Technologies 15 Projects related with the following areas or subareas can be supported with high priority: Wind energy: - Off-shore wind power: resource assessment and special issues regarding offshore wind farm in China - Testing of wind turbines with focus on large wind turbines Bioenergy - Biomass resources, mapping, sustainability, availability - Biofuels development and demonstration - Biomass for CHP, demonstration - Biogas demonstration Solar Energy - Solar heating for district heating systems - Testing of solar panels 9
Integration of renewable energy into the energy systems - RE planning on provincial and city levels - District heating as an integrator of RE - Institutional barriers and solutions to integration of RE - RE and smart grid set-up 16 Furthermore priority will be given to projects demonstrating: A strengthening of on-going or new cooperation between Chinese and Danish companies and institutions A good likelihood of a continued cooperation beyond the current project Innovative development and/or use of renewable energy technologies within the priority areas Technical and economical feasibility with a high probability for success Capacity building for involved partners. 17 For pilot demonstration project, proponents must give a measurable indication of the improvement that is planned to be made as a result of the grant provided by the RED component 2. Type of costs to be covered by the grant 18 The type of costs which can be partly covered by the grant, comprise: Labor cost of proponents staff Cost of consultants (national and international) Investments Travel cost related to the demonstration project Promotion cost (if relevant) to a limited extent (maximum 5% of the grant) Activities That Can NOT Be Supported 19 The following activities will NOT be supported: Investment in commercial production equipment Equity investment in joint ventures Purchase of production licenses Activities covered already by other donor funded programs Full-fledged Feasibility studies Labor for Research and Development (proponent staff) 20 In the proposal, the proponent should mention their own staff used for implementing the proposed project (CVs) and their involvement (number of days over a specified period). The assignment of staff to the project activities should be in line with the responsibility and seniority of the staff members. When asking for payment, the proponent will need to 10
submit an accounting of the actual time worked on the study by each own staff member. Other Costs 21 All other cost will be supported based on evidence of actual expenditure. This includes travel cost. Record Keeping 22 The above implies proper record keeping by the supported companies and institutions. The CNREC will, where necessary, provide technical assistance for this and include this aspect in information and training meetings. For demonstration projects, the Proponent must open a separate bank account marked Danida funding and all details on this account must be delivered to the RED together with the first invoice. Duration of Projects 23 As a general rule, projects shall have duration of not more than 24 months. Selection Criteria 24 CNREC will establish a committee comprising 3-5 staff, the Embassy representatives and representatives from the DEA to review and evaluate the proposal, including providing detailed comments on missing information, areas that need further details or clarification and other improvement required, lowering the grant requested. The comments on the proposals will be sent to the proponents and 2 weeks are given to make the revision. Then CNREC prepares an evaluation report with the final proposal to the RED Programme Steering Committee (PSC) for acceptance and for the Embassy for approval. 25 After getting No Objection from the Embassy, CNREC will inform the proponents on the results. If the proposal is accepted, the CNREC will prepare sub-grant agreement. The final proposal will form an integral part of the grant agreement. 26 In evaluating the proposals the following aspects will be considered: Contribution to achieving the objectives of the RED Component 2 Chances of success of the proposal The proponents are strong and well established; Strategy to finish the proposed project; The parties have experience in proposed areas. Cost effectiveness The ratio of the contribution to achieving the objective of the RED Component 11
Selection Process 2 and the financial support required. 27 In February 2012, the CNREC will issue a Call for Proposals, which will clearly specify which technology areas will be supported. No deadline is set for proposal submitting, but proposals are evaluated according to the turns they are received as far as the budget set by the CNREC allows. 28 To apply for a grant from the RED Component 2, cooperating companies and institutions must submit an electronic copy and 7 hard copies of project proposal (using the standard application format) and all required attachments, both in Chinese and in English, including all documents, brochures etc. The proposal and all information provided will be treated by the CNREC as confidential. In case of inconsistency, the English version will prevail. Grant Agreement 29 For each project approved under this call for proposal by the RED Component 2, a sub-grant agreement will be signed. In this grant agreement, signed by the Embassy and the proponents, the amount of support and the activities the proponents will need to carry out for receiving this, will be specified. The final proposal will form an integral part to this agreement. If necessary, specific requirements for a particular project can be included in the grant agreement. The grant agreement will also clearly specify the reporting requirements of the proponents. 30 The Proponent is responsible for quality assurance of the project or services covered by a contract or an agreement. Reporting Requirement 31 Biannual technical and financial status reports must be elaborated by the Proponent and submitted to CNREC and RDE. 32 For sub-grant agreement, the proponent will need to prepare one or more progress reports to request payment when certain milestone is reached. The schedule of submitting these reports will be included in the contract between the proponents and the Embassy. CNREC develops the format of the progress report and provides to the proponent once the project is operational. The intension of the progress report is to enable CNREC to monitor progress of the projects supported. The progress reports should be revised until it is acceptable. When the progress report is submitted to CNREC for requesting payment, CNREC can arrange for a site visit to check, when necessary. After that, a monitoring or evaluation report will be prepared by CNREC for the Danish Embassy. The Embassy releases the payment if the evaluation report indicates that it is acceptable. 12
33 The most important report is the final report, which will consist of a technical and financial report. The technical report will need to report on the work carried out, outputs and outcomes of the projects. The financial reporting needs to provide evidence on the total project cost and evidence that the expenditure was in line with that proposed in the proposal. For this purpose receipts, invoices and other proof needs to be submitted on expenditure for the project. If needed, CNREC can require a more detailed investigation of the accounting for the project. Grant Payment 34 Because the project can be large, the grant payment is not standardized, and will be different for each project. Request for payment should be accompanied with budget and account of expenditure. The grant payment schedule, based on milestones reached will be specified in the contract between the Embassy and the proponents. CNREC can arrange for the site visit to check if the project is in reported progress. An audit report is needed to clear the final grant payment. 13