Green Infrastructure Phase II Emerging Renewable Power Program Project Application Webinar March 9, 2018
2 Contents Background Applicant Guide Overview: Eligibility and funding Application process Project Application Form General Feedback regarding Expression of Interest responses Q&A
3 Background PAN-CANADIAN FRAMEWORK GREEN INFRASTRUCTURE PHASE II
Pan-Canadian Framework on Clean Growth and Climate Change: Role of the Electricity Sector 4 The electricity sector is key to meeting Canada s target of reducing GHGs by 30% from 2005 levels by 2030 Reduce emissions from electricity generation Currently 11 % of total emissions Secure emissions reductions through efficiency and electrification of other sectors Create an incentive for use of nonemitting electricity Regulation: Pricing carbon pollution (ECCC) Action 1. Low-Carbon Energy Supply 2. Power Systems Infrastructure 3. Grid Modernization 4. Remote Electricity Supply + Demand 5. Transportation Demand 6. Buildings & Communities Demand
Budget 2017 Announcement: Emerging Renewable Power Program $200 million to support the deployment of emerging renewable energy technologies nearing commercialization 5 year program starting FY 2018/2019 (i.e. April 2018) Emerging renewable projects face higher risks, costs and more regulatory issues than projects using established renewable energy sources 5 Program Objectives Expand the portfolio of commercially-viable, investment-ready, renewable energy technologies available in Canada Support development of new supply chains Reduce electricity sector GHG emissions Expect to support 2-4 different technology types, with total number of projects supported depending on their size https://buyandsell.gc.ca/sites/buyandsell.gc.ca/files/trl_diagram_0.pdf
6 Applicant Guide Overview EMERGING RENEWABLE POWER PROGRAM APPLICANT GUIDE
Applicant Guide: Program Expected Results ( 8) 7 Increased deployment of emerging RE power projects Reduced barriers to deployment of emerging RE power projects Increase in renewable energy capacity from emerging sources Environmental benefits, including GHG reductions Increase in renewable technology supply chains Increase in awareness and understanding of regional energy resources and impacts from renewable energy projects
Applicant Guide: Eligible technologies ( 3,4,&11) 8 Emerging renewable power projects are defined as using technologies that: Have been successfully deployed at the utility scale in other countries but not yet in Canada; or Have been successfully demonstrated in Canada but not yet commercially deployed.
Applicant Guide: Eligible technologies ( 3,4,&11) 9 Eligible Offshore Wind Geothermal Instream Tidal Concentrated Photovoltaic Other (must meet emerging definition) Not Eligible Renewables that are already commercial (onshore wind, conventional PV, small hydro, ) Renewable heating Energy Storage Renewable fuel production Residential and building integrated renewable energy projects Non-organic waste to power
10 Applicant Guide: Eligible Recipients ( 9) Legal entities validly registered in Canada Provincial, territorial, regional, or municipal governments and their departments or agencies Indigenous communities or governments, tribal councils or entities that fulfil a similar function
Applicant Guide: Duration and funding limits ( 15) 11 Applicants may request up to 50% of their total project expenditures, to a maximum of $50 million. Funding for the program is available for projects between April 1, 2018 and March 31, 2023.
Applicant Guide: Repayable Contributions ( 14) 12 Project funding will be repayable IF the project generates a profit for the Recipient within 5 years of project commissioning. Repayment will be proportional to the amount of profit and NRCan s funding of the original project.
Applicant Guide: Holdback ( 24) 13 A percentage of the contribution agreement will be withheld until all the conditions of the contribution agreement have been met Proponent must achieve a minimum average of 50% their expected capacity factor over the two-year period starting from the date of Project commissioning The percentage withheld will be determined based on the risk level of the Project.
14 Applicant Guide: Eligible Expenditures ( 12) See Applicant Guide for more details Examples: salaries, professional services, equipment and reasonable travel costs that must all be directly related to the project Overhead must be limited to 15% of total project costs In-kind from the applicant is considered as cash for the purposes of the project budget In-kind would only come from project partners In-kind must be verifiable
15 Applicant Guide: Ineligible expenditures( 13) Applicants could choose to identify ineligible expenditures in the proposal, but they would not be included in the total project cost amount used to calculate the amount eligible for NRCan funding. Ineligible costs include: Land acquisition costs; Legal costs; Project Application preparation costs; Costs related to energy storage or heating components of a Project; All costs associated with the protection of intellectual property; and Costs incurred before the proposal approval notification date, or after the Project Completion Date. Applicants could identify the following costs attributable to the total project costs (proponent contribution) but will not be refunded for: Collaborations with federal laboratories; The reimbursable portion of Federal and Provincial Taxes; or, In-kind costs
Applicant Guide: Basis and timing of payments ( 16) 16 Contribution agreements (CA) will set out the required terms, including timing for payment Final payment will not be made until all Project activities have been completed by the Proponent and are deemed acceptable to NRCan. Per the CA, a percentage of funding (holdback) may be in place depending on the project risk of meeting targets.
Applicant Guide: Stacking of Assistance ( 17) 17 The proponent must disclose all funding sources at the application phase and at completion of the Project. The maximum level of total Canadian government funding authorized under this program will be 75% of Eligible Project Costs. 100% of eligible costs could be stacked if the proponent is a provincial, territorial, municipal government or their departments and agencies, or an Indigenous Recipient.
18 EMERGING RENEWABLE POWER PROGRAM APPLICANT GUIDE : APPLICATION PROCESS STAGES
Applicant Guide: Application Process Stages ( 18) 1. Submission of the Project Application 2. Initial screening based on eligibility 3. Evaluation by a panel of experts 4. Due diligence phase 5. Negotiation of contribution agreements 19
Applicant Guide: Proposal Evaluation criteria ( 20) Mandatory pass or fail criteria include: recipient being validly incorporated in Canada project location in Canada and meets minimum size requirement electricity production for sale or use in Canada Technology is eligible Application completeness Rated criteria will include the following themes in order of importance: Program objectives Project plan Financial stability 20
Applicant Guide: Proposal Evaluation criteria ( 20) 21 1. Program Objectives Cost of Project to the Program Life Cycle Energy Costs of Project Project size GHG Reductions Socio-economic benefits including jobs Indigenous Involvement 2. Project Plan Expected Commissioning Date Project Design and Proposed Work Plan Permits Impact Statement or Federal Environmental Assessment Community Involvement Project Risks Expected Energy Resource Project Team Experience 3. Financial Stability Financial Plan of Applicant Power Purchase Agreement (or Power Pool) Plan Proponent Financial Contribution 4. Other Considerations Although the costs of energy storage or heating components related to a project are ineligible for program funding, points may be given to proposed projects that include these components Bolded criteria will be more heavily weighted during the evaluation process
Applicant Guide: Due Diligence & CA Negotiations ( 21&22) The due diligence phase will include an evaluation of the Project s financial and technical risk where the applicant may be asked for detailed clarification or more information. Any funding provided by NRCan is subject to there being a signed contribution agreement (CA) by both parties. NRCan would have no obligation to make a financial contribution prior to signing the CA. 22
23 PROJECT APPLICATION FORM
24 Project Application Form Proposals must be submitted by 23:59 EST, April 20, 2018 The completed project application form and all annexes must be submitted by e-mail (or mail) both as an Excel file and as a signed PDF
25 Section 1: Information about the Proponent Project Application Form To be filled out by the program ERPP Registration Number (internal): Date proposal was received (internal) yyyy/mm/dd 1.1 Legal name of the Proponent: Address of the legal entity: Legal status (e.g. limited partnership, corporation, Crown corporation) of the Proponent: Jurisdiction of the business (province or territory): Street City Province Postal code Business registration number:
Project Application Form: Section 2 26 2.2: select your technology type from drop down menu 2.4: Net Capacity - total megawatt contribution the project will make to the grid, after taking into account power consumed on site 2.4: Nameplate Capacity - maximum rated output 2.5: Capacity factor: expected average annual power production in GWh divided by rated (net) peak power
Project Application Form: Section 3 27 The requested information depends on technology type selected in section 2.2 Please contact us if you have any questions regarding the requested information Section 3: Information about the expected energy resource 3.1 (offshore wind*) Expected average annual wind speed at the site: (show how this is estimated in A4) m/s : m (hub height): * offshore wind is used as an illustrative example, and its use does not imply it will be considered more favourably than other technologies for this program.
Project Application Form: Sections 4-7 28 Suggest completing Annexes first and summarizing your information in sections 4,5,6 Total costs from Apr 1, 2018 to Mar 31, 2023 Section 7: Supporting documents The following information must be attached seperately to your PAF Annex Check Remarks by Proponent A1 Provide information about the Proponent and the development team s experience in the electric power plant sector. Provide relevant experience with the technology or similar applications. Please limit to 2 pages. A2 Short description of the project and technology, including size, site location, ownership of project and socio-economic benefits such as jobs, heating, food security, energy security, etc. Please limit to 2 pages.
Project Application Form: Annexes 6 and 7 29 A6: Applicant guide provides a link to a table of GHG emissions per province (click on Canada NIR: 2017NIR PT2 pg. 233) A7: include any technical standards applicable to your industry
Project Application Form: Annex 9 30 Provide a detailed a breakdown of the expected Project costs by fiscal year (April 1 to March 31) between the period of April 1, 2018 and March 31, 2023 Note: only costs incurred over program life can be eligible Identify eligible Project costs and ineligible Project costs Identify sources of funds for the Project.
Applicant Guide: Proposal Evaluation (Annex 10 - Schedule B) 31 Life Cycle Electricity Costs (LCEC) for projects submitted under the Emerging Renewable Power Program Estimated Cost of Project Project Name Capacity (MW) Exp. Annual Prod. (GWh) Exp. Cap. Factor Technology 50 400 91.3% Cost CAD Project Lifetime Capital Total Project Costs Provide total of all expected costs incured by the developer to build the project from it's design to commissioning, including component costs, permits, substation, labour and construction costs exclusive of funding $400,000,000 30 Average Operation and Maintenance Costs per year Provide undiscounted average annual costs over the lifetime of the project including all labour and material costs as well as annual costs such as land lease and insurance and allowances for periodic repair and replacements of components. $10,000,000 O&M Costs per Unit MWh $25.00 * Information in red is provided only as an example and does not constitute costs of a real project. Calculations Total Costs over lifetime of Project $700,000,000 LCEC: $/MWh $58.33 Once this form is filled, the information provided will be protected and may be used only in aggregated format
32 General Feedback regarding Expression of Interest responses EXPRESSION OF INTEREST RESPONSES
33 Expression of Interest Purpose NOT A SCREENING TOOL Used to inform program planning Used to help improve instruction in the Applicant Guide Used to provide general feedback to potential applicants in advance of the RFP
Completed EOIs by Technology 34 Other (fuel cell) Other hydro Conventional Storage Tidal EOI packages requested: 347 Total EOIs submitted: 57 Project Application Packages requested as of March 2: 38 Other solar Offshore wind Biomass Geothermal Concentrated PV
35 Feedback: Technology Type Ensure the project technology type is eligible for the Program. If applying under other category, Annex 2 must include a strong description/justification of why the technology and project is both emerging and renewable.
36 Feedback: Proponent and Project Location All projects must be in Canada All proponents must be Canadian legal entities. Proponents in the process of incorporating in Canada must complete the process to be considered eligible.
37 Feedback: Stage of Project Program will support commercial projects Feasibility studies which are not part of a full deployment project are not eligible
Other NRCan Programs supporting renewables: High-level comparison and considerations Program Project types Recipient Types Other requirements Emerging Renewable Power Program Smart Grid Program Clean Energy for Rural & Remote Communities Clean Growth Electric Vehicle Infrastructure Electric Vehicle and Alternative Fuel Infrastructure Energy Efficient Buildings Deploy Utility-scale renewable generation Any in Canada Commercial tech not yet in Canada; Demonstrated but not deployed Demo, Deploy, Hybrid Demo, Deploy, Hybrid R&D, FEED, Demo, up to first commercial installations Demo Grid benefits, grid integrated or microgrid Reduction of diesel use for heat & power in remote communities and/or industrial sites, as well as bioheat for rural locations. Call is tech agnostic; Must reduce impact on air, land, water. Grid management of EV charging infrastructure Utilities, system operators Any in Canada Preference for Indigenous-led and/or supported projects; minimum RE generation requirements for deployment Any in Canada Requires funding from Province / Territory; Must benefit mining, energy or forestry sectors; TRL levels 3-9 Any in Canada Deploy EV fast chargers Any in Canada Applicant must be engaged with the relevant energy supplier R&D, Demo Behind the meter technology Any in Canada 38
39 Q&A Proposals must be submitted by 23:59 EST, April 20, 2018 Program Inquiries: nrcan.erpp-pere.rncan@canada.ca Program website: https://www.nrcan.gc.ca/energy/funding/20502 Program FAQ: continually updated on website