Curacao the solar energy caribbean paradise

Curaçao, “the Solar Energy Caribbean Paradise”

Dr. Arnoldus M. van den Hurk Mir [email protected]

Arnold Holding Ltd. (c) 2012 -‐ Curaçao, "The Solar Energy Caribbean Paradise" 1

“Insert de Video”

… only 2 minutes


Comments about the video •  ... 970 Trillion of kWh of energy falling from the skies every day ...

•  That means about .... 200 Trillion USD falling from the skies every day (in a Curaçao’s feed-‐in tariff price) –  Or … 3.13 Ymes 2011’s world GDP

•  That means about ... 6,200 Trillion every month –  Or about … 100 Ymes the 2011’s world GDP

•  That means about ... 52 quadrillion of US dollars falling every year –  Or about … 800 Ymes the 2011’s world GDP

•  During 25 years of the average of an investment Solar PV project, –  over than 1.3 quinYllion of dollars of potenYal income are waiYng for

investors Arnold Holding Ltd. (c) 2012 -‐ Curaçao, "The Solar Energy Caribbean Paradise" 3

What is a solar energy paradise? •  In technical terms, a paradise in solar energy is the region

with a combinaYon of … –  HIGH SOLAR IRRADIATION –  HIGH ELECTRICITY PRICES

•  But in “financial terms”, a solar energy paradise needs another keystone … –  LOW “WACC” (Weighted Average Cost of Capital), which means the combinaYon of •  RelaYve low “Cost of Debt” •  Moderate to Low “Return of Equity” •  Adequate Credit/Equity RaYo

•  Let's see if the island of Curaçao meets these requirements


What are the key points to become a Solar Photovoltaic Paradise ?

•  The following keystones must be mastered in order to succeed in the investment of a solar photovoltaic plant 1.  Solar Resources -‐ IrradiaYon kWh/m2 2.  Electricity Prices, present and future 3.  Right selecYon of type of solar energy technology and EPC 4.  A good system Performance RaYo 5.  Professional OperaYon & Maintenance 6.  Land /Rookop Rental 7.  Insurances 8.  Corporate and Income Tax 9.  Loan amounts and interest rates 10.  Debt / Equity RaYo and WACC

•  Would you like to know how these key issues affect the Internal Rate of Return on an investment in a 1 MWp installaYon at Curacao? –  Shall we go!!


1.  Solar Resources: kWh/m2


•  The model is based on 1 MW installaYon – Debt/Equity RaYo of 50/50% – Cost of Debt 5.72% -‐ Return of Equity 11.43%

2a. Electricity current Prices •  Average electricity prices can be derived for market segments. In general, electricity

prices are a funcYon –  of fuel cost, capital cost, labour cost, grid cost, energy taxes, energy subsidies, greenhouse gas

(GHG), emission cost and profit margins of generaYon, transmission and distribuYon companies. •  We’ll compare how the electricity tariffs of other ciYes would affect the IRR in a PV

Solar Curaçao


2b. Electricity Prices … future trends

•  Future trends on electricity price in Curaçao –  Based on tariff evoluYon of last decade, the current tariff prices trend points to a yearly basis increase of 4.793% during next 25 years

•  How sensible it would be the IRR to other changes in tariff evoluYon in 1 MW PV Solar plant?


3. SelecYon of the appropriate solar energy technology and EPC


4. System Performance RaYo

•  How the Performance RaYo affect on the Profitability of a PV System and, consequently, the IRR:


5. OperaYon & Maintenance •  O&M are not so expensive than in other power electricity generaYon opYons (wind, fossil fuels, etc.) –  This factor also implies a lower impact over the IRR than in other studied variables


Scenario)1) Scenario)2) Scenario)3) Scenario)4)O&M)(%)Net)Income)) 9,50%) 7,04%) 3,52%) 2,50%)

IRR) 28,75%) 29,54%) 30,23%) 30,98%)

0,00%)

5,00%)

10,00%)

15,00%)

20,00%)

25,00%)

30,00%)

35,00%)

Sensi&bily*analysis*O&M*vs*IRR*

6. Land /Rookop Rental

•  How land rental affect on the profitability of 1 MW PV system at Curaçao?


7. Insurances

•  How cost of insurances affect on the profitability of 1 MW PV plant


8. Corporate & Income Tax


9. Interest rates

•  How the interest rates affect the IRR of an solar PV investment in …


10. Debt / Equity RaYo •  How Debt/Equity RaYo affects on the investment structure for 1 MW PV and the WACC rate: –  5.33% cost of debt and 10.66% return on Equity


Savings and Real Estate implicaYons

•  Some Real Estate products are linked to economic business development (e. g. an Hotel, a warehouse, etc.)

•  An hotel like the Marrioq with an installaYon of 1 MW of solar would supply between 25 – 30% total amount o electricity during 25 years – With SAVINGS: more than 21 million $US –  REAL ESTATE: increase of 5.6 million $US in yearly hotel valuaYon (that balances the price o the PV facility)

•  Isn’t amazing? This is the power of the Sun Arnold Holding Ltd. (c) 2012 -‐ Curaçao, "The Solar Energy Caribbean Paradise" 17

PV Americas Paradise Map 2010

•  GRAPHIC OF THE STUDY OF Q-‐Cells


Curaçao (0.235)

PV Americas Paradise Map 2020


Curaçao (0.342)

CONCLUSIONS – The Candidates and the winner is …

FRANKFURT LOS ANGELES BARCELONA CURAÇAO

1. RadiaYon 4 2 3 1

2. Electricity Prices 3 2 4 1

5. O&M 3 4 1 2

6. Land costs 4 1 2 3

7. Insurances 3 4 1 2

8. Corporate Tax 3 4 2 1

9. Interest Rate 1 2 4 3

10. Debt /Equity 2 1 4 3

RATIO 69,57% 80,00% 76,19% 100,00%


“Insert de Video, again”

… for for those who have been late


Coming back to video •  ... 2.70 billion of kWh of energy fall from the skies every day to Curaçao … •  .... 850 millions of USD fall from the Curaçao’s skies every day (current Curaçao’s

Feed-‐in Tariff) –  Which means the 30% of the Curaçao GDP (2008)

•  ... 24.8 billion of dollars every month –  Which means close to 12 Ymes the Curaçao GDP. –  Or close to 200 million dollars per capita (Curaçao)

•  ... 302,54 billion of dollars every year to Curaçao –  Which means … 0.5% of 2011’s world GDP with only the 0.002% of the world

populaWon –  Or 2,153 million dollars per CAPITA (Curaçao)!!

•  During 25 years of the average of an investment Solar PV project, over than 7.56 trillion of dollars will fall to Curaçao Island in terms of potenYal solar electricity at current prices –  Thanks to the energy of the sun, during next 25 years, the 11.6% of current

World GDP will fall in this Caribbean Paradise named Kursao. •  Good we can’t see it – Bad we don’t use it


EPILOGUE: Alexander & Diogenes Corinth, Greece, 340 B. C.

Alexander the Great addressed

Diogenes with greeYngs, and asked if he wanted anything …

Diogenes replied

"Yes, stand a li]le out of my sunshine.”

And then, Alexander says:

If I were not Alexander, I should wish to be Diogenes


Mi sYma Kòrsou!!!

Dank u wel Thank you Gracias Gràcies Obrigado

Danki !

[email protected]


Investor Relations

Curacao the solar energy caribbean paradise