SHET-MERKE River Small Hydro Power Plant

 

 

 

1.  Project Background

 

Description: Hydro.jpgThe project envisages the construction of a turnkey SHPP on Shet-Merke River in the Raimbek district of Almaty region in Kazakhstan. Preliminary technical assumptions based on available data are as follows:

 

   Design Flow (Q) = 1000 l/s

   Minimal Flow (Qmin) = ~600 l/s

   Penstock (water pipe)

L = 9.78 km, d = 1m

   Net head = ~220 m

   Construction site @ approx.

1670 m a.s.l.

   Capacity = approx. 2-4 MW

depending on no. of turbines

 

 

The water is to be supplied by an existing Soviet-era reinforced concrete/steel water pipe. The weir/pipe structures were originally built to supply a nearby reservoir with water for irrigation purposes, however, since there is no real demand for irrigation the local authorities have a agreed to transfer water / land use rights to SME

A 35 kV transmission line crossing the riverbed at the site of the proposed SHPP will serve as connection point to the grid.

 

      Special attractivity of this project is lays in the relative very investment cost by using existing hydrotechnical infrastructure.

      We estimate investment cost at 4-500k/MW capacity;

      Design, permitting and construction shall take 12-18 months

      Total investment for 3MW capacity is ~ 1.5Million

 

 

 

2. Regulatory Framework Feed-In Tariff

 

Presidential decree № 577 On the Concept of Transition of the Republic of Kazakhstan to the Green Energy from May 30th, 2013

 

Share of Power Generation

2020

2030

2050

3%

20%

50%

 

As of 12th June 2014, the Government of Kazakhstan incentivized the development of renewable energy by introducing a state-guaranteed feed-in tariff fixed for 15 years*

 

Renewable Energy Source

Feed-In Tariff (Tenge/kWh excl. VAT)

Planned Capacity

(MW)

Potential Capacity

(MW)

Wind

22,68

1787

354,000

Solar

34,61

713,5

3,760,000

Small Hydro

16,71

539

4,800

Biogas

32,23

15,05

300

 

In April 2016 an amendment was passed by the Kazakh government in response to the devaluation of the national currency (Tenge) in August 2015 whereby the Approved fixed rates .... are subject to annual indexation based on changes in the exchange rate of the national currency against foreign currencies... 

 

3.  General Information about the Shet-Merke Energo LLC The Local Player

 

Registered in December 2014 with the aim to develop and exploit renewable energy sources in Kazakhstan

The company represents a Joint Venture by the following:

       Mr. Sergey Tereshchenko, Prime Minister of Republic of Kazakhstan from 1991-1993 and prolific entrepreneur particularly in the agricultural industry

       Mr. Akynbekov Amze Aynabekovich, regional government affiliate and business associate of Mr. Tereshchenko

       Sekom HandelsgmbH, a privately-held Austrian company involved in trade and renewable energy development

Current project portfolio includes the planning, construction and operation of:

       2 MW SHPP on Shet-Merke river, Raimbek District of Almaty Region

       Up to 200 MW Wind Farm at Djungar Gate

       Up to 100 MW Wind Farm at Shelek Corridor

       Project portfolio may be expanded to include solar energy projects

 


 

3.  Location of Proposed SHPP

 

Description: Screenshot 2014-09-06 16.01.42.png 

 

 

Description: Screen Shot 2016-05-18 at 10.23.34.png

 

 

 

 

 

 


 

4.      Project financial indicators

 

 

Revenue before tax:

Amortization:

Capital costs:

Required investments:

Period for payback:

Net discounted income:

Discounted profitability index of investments:

Key risks and measures to reduce and prevent risks:

Tax benefits/privileges:

 

330k/MW/year

2 – 2.5 years

650k/MW

1500000

3 years

4 Million

4.0 at 12%

Government guarantee for tarif and exchange rate

10 years free of corporate and property tax

 

5.      Offer to investors

   Required amount of investments:

Investor participation form:

Guaranteed profit:

 

1.5M

SPV or JV (50%)

100% net revenues for the first 2 years and 50% after for the next 8 years.

i.e. 700 x 2 + 350 x 8 = 4.2M in 8 years