A_Brief_Presentation_of_Suberia_Technology

A Brief Presentation of Suberia's Solar Technology

1. Introduction

In the last decades, concentrated solar irradiation has been exploited in centralized, large scale

power plants (referred as CSP, Concentrated Solar Power), with nominal power ranging from tens

to hundreds of megawatts. In the last years, the broader market penetration of large CSP plants

has been hindered, on the one hand, by the impressive market expansion of PV and, on the other,

by financial barriers and project bankability issues, in particular after the 2008 financial recession

encountered by local developers taking part in national solar initiatives. Recently novel designs of

concentrated solar technologies, less expensive and more scalable, have been successfully

developed and applied to process heat generation for industrial and civil applications. This

technology solution, referred as CST (Concentrated Solar Thermal), is expected to intercept the

increasing demand for energy saving technologies and offer a new opportunity in response to

policies oriented to energy efficiency and greenhouse gas emission reduction. Due to lower capital

costs, financing constraints are expected to be less of a barrier for small-scale distributed CST

plants while maintaining strong economic returns. Distributed CST plants are characterized by

smaller land and environmental footprints, thereby lowering social costs arising from competing

land issues and smaller capital requirements.

Small, distributed CST and CSP systems represent a significant and largely untapped market

sector for solar thermal, which ranges from micro-generation for ambient heating and cooling, to

medium temperature heat and power generation as summarized in the following Table:

Plant type Output Scale(min - max)

Operating Temperature

Energy Output

Applications

Micro-generation 10s kW – 100s kW 90°C – 150 °C Heat ambient heating and cooling

Medium Temperature Heat

100s kW - 10s MW 90°C - 300°C Heat Process Heat

Power Generation 1 MW – 10s MW Around 300°C Electricity Power generation

Co-Generation 100s kW - 10s MWAround 300°C + Water 90 °C

Electricity + Heat

Power generation + ambient

heating and cooling

Suberia Systems srl, Piazza della Repubblica 22 – 09125, Cagliari (CA) - P.I. 03456270929

2. The proposal from Suberia

Suberia Systems srl (referred as Suberia later in the document) proposes to the market a no-

compromises solution, based on Linear Fresnel Reflectors (LFR) that incorporate concentrating

optics. This solution offers the highest performance and cost competitiveness at distributed scale,

from commodity micro-thermal generation to medium-scale power generation. What is new in

Suberia's approach?

Suberia’s technology derives from a well-balanced combination of proprietary (patent filed) highly

advanced components (the reflectors, which make up the optical system for concentrating the

solar irradiation) with the simplicity of the plant solutions (e.g. design, materials, installations,

disposal etc.). Suberia's plants make extensive use of components fabricated worldwide in very

large scale to serve several industrial sectors. This results in products being highly available in

local markets at competitive prices. The installation of Suberia's plant does not require any

specialized skill in solar technologies. The required expertise is largely available in local

construction companies operating in process heat industries.

Suberia has successfully combined the simplicity of high performing, cost-competitive, proprietary

reflectors (the most crucial component of the technology) with a light and highly scalable design

suitable for micro-generation. The reflectors are the key element for making Suberia plants cost-

effective and contemporaneously high-performing.

The differences of Suberia’s solution with respect to its direct Fresnel competitors are evidenced in

(i) a cheaper metallic structure, easier to install and manufacture locally, (ii) a high-performance

thin glass mirror very precisely curved and assembled in a light and durable reflective panel, (iii) a

proprietary, reliable solar field control system, wired or totally wireless depending on customer

choice or local installation costs, (iv) an original low-cost solution for the heat storage based on

single tank, thermocline concept, (v) competitive price, aligned to the lowest cost in the market

sector, but with no compromises to performance, and (vi) the extensive use of standard, commonly

available components that facilitates the participation of local suppliers and lowers the import

costs.

3. The technology in short

The technology is based on the above-mentioned solar concentrating system named Linear

Fresnel Reflectors, an optical system able to reflect and concentrate the solar radiation on a focal

line where a vacuum receiver tube is positioned. The vacuum receiver tube is a technologically

advanced component that adsorbs the solar radiation which, in turn, is transformed very efficiently


into heat on the tube surface. In the receiver tube, water or thermal oil flows to transport the heat

generated on the tube surface. A typical size of the concentration module for micro-generation and

process heat is 24m long and 5m wide, with around 72 m2 of effective reflective surface. A

concentration module intercepts 72 kW of direct solar radiation at nominal peak conditions

(assumed 1000 W/m2), that can be converted to around 45 kW of heat flux. Modules can be

connected together to form lines and loops to increase the irradiation collecting surface and to

achieve the heat flux and temperatures required by the final application.

The heat transported by the thermal fluid (water or oil) can be directly employed to feed thermal

processes, or accumulated in heat storage tanks. The thermal fluid can also be employed in a

thermo-electrical turbo-generator system (ORC - Organic Rankine Cycle) for power generation.

The heat-to-power conversion efficiency of an ORC turbo-generator ranges from 16% to 24%

depending on power production scale and operating temperatures.

Images of LFR systems are shown below:

4. The market for Suberia's CST plants

The Suberia solution fits in with a peculiar market demand: the production of process heat at low-

medium range temperatures.

Heat is often under-appreciated in public policy discussions on energy, frequently overshadowed

by transportation energy and electric power. However, heat accounts for 37 percent of energy

consumed within most developed countries, and 47 percent of the world’s energy consumption.

While many associate solar energy with electricity-producing photovoltaic (PV) panels, solar can

also be very effective for heating purposes. Solar thermal energy is most commonly used to heat

outdoor swimming pools and residential water, but it can also be used for many types of industrial

processes.

Most energy applications in industrial production processes is below 250°C – a temperature level,

which could be well supplied by Suberia's technology. The lower temperature level (< 80°C) can


already be provided today with commercially available solar thermal collectors. However, current

alternatives create troublesome challenges in precisely controlling the output temperature, in

particular when the solar irradiation is low and intermittent as in winter periods.

Solar heat applications for industrial processes is still in its infancy and yet, there is potentially an

enormous range of solar thermal applications within this sector which can supply a large portion of

our total energy demand. It is an economic, commercially viable and available technology, which

due to the different market barriers, however, has not reached its market potential. Despite the

limited penetration of solar technologies in the industrial sector, its potential is quite large. For

instance, in 2007 the industrial sector represented 28% of the final energy consumption in the

EU 27, and about 30% in the South Mediterranean Countries (SMCs), with a significant

part of heat required below 250°C. Tapping into this potential would provide a significant

solar contribution to industrial energy systems.

The industrial sector in the United States is the leading source of energy consumption At nearly

one third of total energy use, it exceeds both the transportation and residential sectors. Within the

industrial sector, nearly two thirds of energy used is consumed as heat. Industry’s role as the

largest consumer of energy in the USA, its large heat requirements, and its heavy reliance on fossil

fuels, present tremendous opportunity for application of solar thermal technology.

Besides industrial processes, solar thermal energy can be successfully used for all heating and

cooling end-use applications. In US, The residential, commercial, and industrial sectors spend over

$270 billion annually on heating and cooling. Solar heating and cooling (SHC) technologies

possess a wide range of applications and proven uses, including domestic water heating, space

heating, swimming pool heating, air conditioning, process heating, steam generation, and air

heating.

SHC draws from an inexhaustible energy source while displacing fossil fuels and electricity

otherwise needed for heating and cooling. This reduces emissions of CO2 and air pollutants while

stimulating local job and economic growth.

By taking into account the above arguments, various customer segments can be identified,

distinctive in terms of final application and size of the investment.

o Big industries that employ considerable amount of heat for their processes (for examples, chemical, pharmaceutical and textile farms);

o Agricultural farms and food processing industries that need heat or refrigeration for their processes (food preservation, sterilization, dehydration etc.);

o Small-medium size enterprises aiming to save energy costs for their production process or for ambient heating and cooling;


o Financial companies that aim to propose to the market financing solutions in the Energy Efficiency sector;

o Public bodies that want to take advantage of energy savings and auto-production incentives. Western economies seek investment in industry and technologies that further stimulate economic growth.

o Industrial and commercial areas that expects to lower their energy consumption costs for ambient cooling of refrigeration by means of solar cooling combined with high performance solar chillers;

o Small urban and rural conglomerate with infrastructures for remote ambient heating and cooling;

o Sportive and touristic infrastructures for the generation of hot water and ambient heating and cooling;

o Desalination – combined with desalination plants for the production of fresh water from sea in desert or arid areas

The above list highlights the wide and articulated range of potential customers for the Suberia

technology

5.

6. System parameters and financial summary for 1 Megawatt Thermal Plant

In the following Tables the main technical and economical parameters, relative to 1 MW Suberia's

solar thermal production, are presented:

PURE-SOLAR CONFIGURATION, NO STORAGE, SOLAR MULTIPLE = 1.0

Parameter Value Units

Plant Nominal Power 1,0 MW (thermal)

Energy received (DNI reference value – South of Europe)

20005,5

kWh/m2/yrkWh/m2/day

Peak Irradiation (Nominal) 1000 W/m2

Total collector surface 1728 m2

Required ground surface 3750 m2

Heat Production 2’011’000 KWh

Equivalent hours 2000 hr/year

Solar field efficiency 58 %

Plant lifetime 25 years

Yearly greenhouse gas reduction 364 Tons of CO2


ECONOMICS & FINANCIALS

Parameter Value Units

Project cost per kW installed 650 €/kW

Levelised Cost of Energy 0.044 €/kWh

Fuel Cost of Energy (assumed) 0.1 €/kWh

Value of annual solar energy production 201'100 €

IRR (25 yr) 27.5 %

NPV (25 yr) 1'918'000 KWh

Payback 4 years

The above financial summary assumes no incentives and no financing. The above performance

and cost estimations are based on generic and preliminary assumptions. It is advised to adopt the

appropriate prudence in applying the above results to real and specific cases since several

parameters might vary substantially, depending on the operational and financial context in which

the technology is applied and used.

7. 5-year economic and financial plan of Suberia

At present, Suberia , started in October 2012, is completing its first stage of development, devoted

to the pre-competitive research and development of plant design, reflectors manufacturing, and the

electronics for the process control. The 3-years work of the first stage will be completed with the

installation of a demonstrative system, in the premises of a local industrial factory (SeTrand) that

operates of special waste treatment facility. SeTrand will use the hot water generated by Suberia's

CST plant to increase the temperature, and consequently reduce the viscosity, of a muddy mixture

before the treatment and abatement of the contained chemical contaminants. The installation of

the demonstrative system is planned to be completed by the end of 2015 in the period October-

November. The subsequent 5-year strategic plan of Suberia, i.e. 2016-2020, will be focused on the

commercial demonstration of the technology, the business development, the market expansion and

consolidation and the selection of an internal team with suitable technical and administrative

expertise. The first part of the five years is marked by the investments in: (i) the equipment for the

establishment of a serial production line for the reflectors, (ii) the dies for press-forming and

molding of specific plant components, (iii) the organization of the logistics for the storage of plant

components and their worldwide delivery at the installation sites, and (iv) all the remaining

appropriate actions for achieving the expected cost competitiveness and yearly volume of sales,

as shown in the following histogram:


The Suberia business plan is based on the assumption that the target sale volume of 120 MW/year

can be reasonably achieved at the 4th year according to the following trend, as pictured in the

graph below:

Taking into account all Indirect Costs (not presented here) the EBITDA results as follows:

The predicted loss/profit balance for the current business plan is shown in the following histogram:


1° Yr 2° Yr 3° Yr 4° Yr 5° Yr -

20

40

60

80

100

120

140

1 15

70

120 120

1° Yr 2° Yr 3° Yr 4° Yr 5° Yr -

200

400

600

800

1,000 860

150 250 250 250

Investments ---- '000 €

1° Yr 2° Yr 3° Yr 4° Yr 5° Yr-5,000

-

5,000

10,000

15,000

20,000

25,000

30,000

-408 1,022

8,409

21,627 25,104

EBITDA ---- '000 €

Thermal Plants -- #MW thermal

The scope of this presentation is to provide a brief summary of the technical solution that the

Company aims to offer in the market, together with the Company’s 5-year development plan.

Details that support the summary provided here can be provided upon request.

The above preliminary estimations, combined with the increasing interest of the market toward

energy saving solutions and the availability of financing initiatives that can facilitate their diffusion,

highlight the high market penetration and profitability potential of the solution proposed by Suberia.


Operating Profit/Loss ---- '000 €

1° Yr 2° Yr 3° Yr 4° Yr 5° Yr

-4,000

-

4,000

8,000

12,000

16,000

20,000

-523 559

5,743

14,997

17,391

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