Project Finance Executive Summary - Vacaville, CA · Project Finance Executive Summary ... it was...

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P: 307.200.7075 F: 866.593.9753 E: [email protected] www.PristineSun.com Western Regional Office: 4695 MacArthur Court, 11 th Floor Newport Beach, CA 92660 Headquarters: 970 W. Broadway, Suite E-393 Jackson, WY 83002-3000 Pristine Sun LLC a clean energy company $1 Billion in energy assets by 2015 Project Finance Executive Summary Pristine Sun LLC Pristine Sun’s core management team have an average of 10 years’ experience each in the development and finance of solar & wind projects, with a combined total of $1 Billion+. One example: in 2001-2004 our core team developed the project site that is the largest wind farm in Kansas: the ~$450 Million (250 MW) Smoky Hills Wind Farm. Our business model is simple: rapidly acquire 20-year Power Purchase Agreements (or PPAs) to sell clean electricity to the host property owners, then underwrite and finance these low-risk projects that offer leveraged IRRs of at least 25% after tax and pre-tax unleveraged IRRs of 11-15%. Pristine Sun has signed PPAs in hand totaling $100 Million + $150 Million of Feed-In-Tariff (FIT) projects that can be “shovel ready” within ~90 days from a funding commitment (totaling $250 Million of projects need financing commitments now), plus $600 Million+ of LOIs for additional 150 MW of PPAs in our development pipeline. These projects are primarily rooftop & carport solar PV with private companies, churches and private schools, with some Feed In Tariff projects where the utility is the power buyer. Some projects include small wind turbines and/or solar hot water. In 2010 we funded the first $250,000 of small commercial & residential PPA projects with our own capital and are currently funding several more internally. In March 2011 we closed on funding for three projects in Hawaii (Maui Brewing Company, Maui Chemical Corp and Maui Brewpub) totaling $3 Million (~600 kW) and each of these projects should be under construction by Earth Day 2011 (April 26 th ). We expect to close financing in April on $4 Mil- lion of additional projects in Maryland and California.

Transcript of Project Finance Executive Summary - Vacaville, CA · Project Finance Executive Summary ... it was...

Page 1: Project Finance Executive Summary - Vacaville, CA · Project Finance Executive Summary ... it was recapitalized by Italian utility Enel SPA which finished construction on a ... has

P: 307.200.7075

F: 866.593.9753

E: [email protected]

www.PristineSun.com

Western Regional Office:

4695 MacArthur Court, 11th

Floor

Newport Beach, CA 92660

Headquarters:

970 W. Broadway, Suite E-393

Jackson, WY 83002-3000

Pristine Sun LLC

a clean energy company

$1 Billion in energy assets by 2015

Project Finance

Executive Summary

Pristine Sun LLC

Pristine Sun’s core management team have an average of 10 years’ experience each in the

development and finance of solar & wind projects, with a combined total of $1 Billion+. One

example: in 2001-2004 our core team developed the project site that is the largest wind

farm in Kansas: the ~$450 Million (250 MW) Smoky Hills Wind Farm. Our business model is

simple: rapidly acquire 20-year Power Purchase Agreements (or PPAs) to sell clean electricity

to the host property owners, then underwrite and finance these low-risk projects that offer

leveraged IRRs of at least 25% after tax and pre-tax unleveraged IRRs of 11-15%.

Pristine Sun has signed PPAs in hand totaling $100 Million + $150 Million of Feed-In-Tariff

(FIT) projects that can be “shovel ready” within ~90 days from a funding commitment

(totaling $250 Million of projects need financing commitments now), plus $600 Million+ of

LOIs for additional 150 MW of PPAs in our development pipeline. These projects are primarily

rooftop & carport solar PV with private companies, churches and private schools, with some

Feed In Tariff projects where the utility is the power buyer. Some projects include small wind

turbines and/or solar hot water.

In 2010 we funded the first $250,000 of small commercial & residential PPA projects with

our own capital and are currently funding several more internally. In March 2011 we closed

on funding for three projects in Hawaii (Maui Brewing Company, Maui Chemical Corp and

Maui Brewpub) totaling $3 Million (~600 kW) and each of these projects should be under

construction by Earth Day 2011 (April 26th

). We expect to close financing in April on $4 Mil-

lion of additional projects in Maryland and California.

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Each project must meeting the following minimum standards to be

approved by Pristine Sun LLC for financing:

1. Rebates & incentives equal 70% or more of installed project cost

2. Shading is no more than 15% of annual insolation

3. Roof condition is average or better (if roof-mount)

4. City permitting conditions are reasonable

5. Serving utility offers true net metering

6. EES generation equals at least 33% of customer usage

7. Good credit (Dun & Bradstreet and/or Moody’s)

8. Installation will be in U.S./U.S. territory or Ontario, Canada

9. No recent bankruptcies

10.No significant pending judgments

11.No criminal record (for key principals)

12.If customer is a tenant, the landlord gives consent for meter to

be controlled by Pristine Sun in the event tenant moves out

13.Equity in property is greater than value of EES equipment

14.Pre-tax unleveraged IRR > 12%

15.After-tax leveraged IRR > 25%

a clean energy provider

Investment Criteria

$1 Billion in energy assets by 2015

“Principals each have at least 10 years of energy project development and/or

finance experience. We have created a marketing machine that has generated a

whopping $250 Million of solar & wind projects in less than 9 months.”

1 of 10 projects we built

for SPRINT Corp.

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Alysia Carlson Helming, Principal. Ms. Helming has over 18 years’ experience in providing internal and external advisory services to CFOs & CEOs for Fortune 500

and mid-sized corporations, including Bushnell, Wells Fargo Bank, Hallmark Cards, DST Systems and Exelon. Most recently, Alysia offered Interim CFO services to KC Biofuels,

LLC and Probiotics Holdings, LLC. Prior to this, Alysia was Director of Financial Planning & Analysis at Bushnell Outdoor Products, where she served as the Company’s liaison

with attorneys, bankers, and buyers to successfully sell the company in an $800 Million transaction in 2007. Alysia was a co-founder and CFO for Kansas Wind Power (now Trade

Wind Energy), a wind power development company. Prior, Alysia played an integral role in transitioning the KC/Omaha offices of Andersen Business Consulting into a new start

up consulting firm called MarketSphere Consulting. Alysia was a Manager with Andersen Business Consulting. Prior to joining Andersen, Alysia was the Vice President of Strategy

for the Investment Management & Trust Group at Wells Fargo Bank. Her 7 year career at Wells Fargo began as Financial Analyst for the CFO. Alysia holds a BA in Economics

(emphasis in Finance and Accounting) from the University of California, Santa Cruz. In 2006, she coordinated the KC premiere of the feature-length movie "The Great Warming"

starring Alanis Morrissette and Keanu Reeves, and helped with the nationwide opening of the film. Ms. Helming first became certified in wind and clean energy project finance in

2003 and has developed numerous financial models and pro-formas for the wind, solar, and biofuels finance industry.

Troy Helming, Principal. Mr. Helming has been a CEO or President, as well as a clean energy visionary, for nearly 20 years. He founded Kansas Wind Power LLC (now

TradeWind Energy LLC), raised millions of seed capital, acquired PPAs/LOIs with utilities for $300 Million of wind and solar projects, and developed wind farm sites. He sold the

company in 2003; it was recapitalized by Italian utility Enel SPA which finished construction on a 250 MW $450 Million wind farm (Smoky Hills Windfarm). In 2005 Mr. Helming

wrote & published a book The Clean Power Revolution, created The Freedom PlanSM (a blueprint to convert America to 100% renewable energy and save the U.S. economy $1

Trillion per year), published numerous articles, has been a keynote speaker in 13 states and 4 countries, promoted renewable energy tirelessly on TV & radio, fought the construc-

tion of various new coal plants, and served for the Sierra Club as an expert witness on wind energy. In 2007 Mr. Helming designed, built, and operated an EPA-registered 10 mgpy

biodiesel refinery. Since 2001 Mr. Helming has designed, sold, permitted, installed, and serviced numerous small wind, solar, fuel cell and energy efficiency solutions and been a

consultant for dozens of companies (including McKenzie & Company, Bank of America, Citigroup, etc.). Mr. Helming was trained in sales by AT&T in 1990, won the 1st ever Class

Excellence Award awarded to the MO/KAN branch, and won numerous top national sales awards during a successful 10 year career in telecommunications. He holds a BS in

Business Administration from the University of Kansas (where he was captain of the National Champion yell-leading squad on ESPN & 2-time All American), has certifications in

wind energy finance, system design & technical sales, and is a member of Mensa.

Josh Crooker, Principal. Mr. Crooker has 10 years of full-time renewable energy experience, primarily wind and solar. He has developed sites for and/or designed, sold,

permitted and/or personally installed over $500 Million of solar and wind projects, including commercial projects for a Fortune 100 client and government agencies. He attended

the University of Missouri-Rolla for Electrical Engineering and then moved to Kansas City to continue school at University of Missouri-Kansas City studying Information Technol-

ogy. Mr. Crooker acquired his pilot’s license in 1999 and obtained Instructors certificates and Commercial Pilots License. As the former President of Krystal Planet Corporation,

an energy efficiency and clean energy product marketing, training, and project development company, Mr. Crooker has been involved in all aspects from design, feasibility studies,

installation, construction, operation, maintaining, and updating of wind systems, solar photovoltaic, solar thermal systems, and biodiesel production. Mr. Crooker has been an

integral management team member in the development of numerous clean energy systems from small residential through large commercial and utility scale.

Carl Peterson, Principal. Mr. Peterson has 28 years of experience in the independent energy business. During that time, he has been directly responsible for arranging

both the debt and equity financing for a total of 32 energy projects throughout the United States. Those projects include: hydroelectric, geothermal, and co-generation projects

with a combined value of excess of $750 Million. After attending Boise State University, Mr. Peterson worked for the Xerox Corporation. During his tenure with Xerox, Mr.

Peterson received over 5000 hours of advanced sales and management training. Every year, for ten years, he distinguished himself by performing in the top 1% of a five thousand

man sales force, and was promoted four times. In 1984, he was offered an equity partnership with one of his consulting clients, the Bonneville Pacific Corporation; a company that

was formed to build privately owned power plants around the western U.S. Until 1990, Mr. Peterson was the Senior Vice President of New Business Development and Finance

for the Bonneville Pacific Corp. Since 1990, Mr. Peterson’s consulting practice has helped clients in obtaining both debt and equity financing for projects they are developing, with

an emphasis in energy, especially the green energy sector.

Tim Woolsey, Supply Chain Director, CPM/CPIM. Mr. Woolsey is a seasoned professional executive director with 25 years in operations, production,

manufacturing, and supply chain management experience in demanding technical environments in United States and overseas. Mr. Woolsey has a BA Degree in Business Economic

and professional association certificates from APICS (cpim) and ISM (cpm). He possesses direct and pertinent professional experience in engineering, construction, electronics,

semiconductor, and ERP Software’s industries. Exceptional liaison skills: builder of bridges between production, operations, and supply chain functions. Mr. Woolsey’s has man-

aged international operations for large multi-national firms such as Saudi Aramco (the world’s largest oil company) and Siemens Information Systems. Mr. Woolsey will oversee

the management of the operations department for Pristine Sun handling major supplier and vendor deliverables involving large, multi-million dollar contracts with a complex,

worldwide supplier base. Tim will bring World Class Manufacturing and Lean Six Sigma processes to Pristine Sun ensuring that the company is providing the highest customer

satisfaction to our customers and timely completion of projects to maximize value and yields for our financial partners.

Felix Yu, Principal. Mr. Yu has over 15 years banking industry finance experience in functions including corporate finance, strategic planning, management reporting, and

performance operating metrics, global sales/trading operations and investment management marketing support. Previously, he was Vice President and Division Finance Officer at

Wells Fargo & Company's Business Banking Group, Technology and Operations. At Wells Fargo, he managed the financial impact and reporting of major bank mergers, consolida-

tion of operations centers, and development and implementation of performance metric models He started his banking career as an associate at JPMorgan Chase & Company's

Hong Kong branch, supporting the sales & trading middle office. He has a B.S. in Physics from UCLA, and an M.B.A from Carnegie Mellon University.

a clean energy provider

Management Team

$1 Billion in energy assets by 2015

Sales & Marketing team

Note: administrative support team members are not listed.

Madison Baker

Gavin Carmichael

Frank Erickson

Andrew Fairbanks

Ralph Funk

Green Diversity Group

Erika Kantola

Wade Kenyon

Tiffany Lee

Bill Miller

Tamas Oltman

Bryan Ottinger

Pat Reagan

Steve Smith

Chuck Vrabel

Mandy Zhang

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a clean energy provider

Strategic Alliances &

Key Vendors

$1 Billion in energy assets by 2015

“EPA Analysis

Confirms that America

Can Shift to Clean

Energy While Also

Reducing Energy Bills”

New York Times

6/21/2010

Installers / EPC / O&M contractors:

Abengoa Solar

Akeena Solar / Westinghouse

Apollo Era Solar

Erickson Electric

Derbigum

Nations Roof

Preferred Electric

Smart Solar

Standard Solar/Gridpoint

Schneider Electric

Teyma USA

Capital Sources:

SMX Capital

Bridge Bank

ACC Capital

MRE Capital

Marquette Equipment Finance

Meridian Bank NA

Commercial & Industrial Bank of China

Dalmatian Global Solar

Triton Capital Alliance

Key Professionals & Vendors:

Wildman, Harrold, Allen & Dixon LLP

Taylor English Duma LLP (tax & accounting)

The Reznick Group (solar-specific accounting)

Ryan Inc. (tax consulting)

Allianz

Abacus Construction Management, Inc.

DC Power Systems (design, logistics, supplier)

Enphase (microinverters)

Sat Con (inverters)

PV Powered (central inverters)

Solar Max Technology

Sunlink (racking & mounting systems)

OnGrid (utility billing analyses software)

PV Watts (system design, insolation forecasts)

RESPR Inc (forecast/output certification)

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a clean energy provider

Market Potential

$1 Billion in energy assets by 2015

“Solar photovoltaics (including

modules, system components,

and installation) will grow from

a $36.1 billion industry in 2009

to $116.5 billion by 2019. New

installations reached just more

than 7 GW worldwide in 2009, a

sevenfold increase from five

years earlier.” Clean Edge 2010

The U.S. solar PPA

industry has raised at

least $2.5 Billion in

project financing

(that we know about

from press releases)

in the last 2 years.

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a clean energy provider

Project Development

$1 Billion in energy assets by 2015

PHASE 1: ORIGINATION & SITE CONTROL

Customer signs Letter of Intent

Remote site survey & billing analysis

Job Estimate

Document preparation

Customer signs PPA, deposit check

PHASE 2: UNDERWRITING & FINANCING

Credit report

Title report

Financial modeling

Preliminary financing approval

Revise documentation as needed for lenders

Obtain installer bids

Select installer

Prepare Design Document and additional docs

Customer signs additional docs

Legal review

Final financing & project approval

PHASE 3: ENGINEER, PROCURE, CONSTRUCT

Acquire permits

Construction

Testing & commissioning

Inspections

Complete & submit rebate applications

PHASE 4: ASSET MANAGEMENT

Send welcome letter to customer

Set up customer in CRM and billing systems

Run system output maximization algorithms

Assign O&M contractor and panel washing contractors, set schedule

Maximize REC / carbon credit revenue via trading desk(s)

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Although numerous

solar PPA providers

have emerged in the

last few years, our

focus is on the

underserved middle

market (small and

mid-size projects).

Nearly all of our

competitors build

only large projects

of 500 kW or

greater, and only in

a few states.

a clean energy provider

Competitive Advantages

$1 Billion in energy assets by 2015

Risk Mitigation

ADVANTAGE DESCRIPTION

PPA Capital

The limiting factor in the solar PPA market is financing for solar projects. With the

track record of our management team in raising capital for wind, solar, and real

estate projects, we believe we can beat most of our competitors in the capital

raising game.

Management

Unlike many of our competitors who have financial people as key management, we

bring decades of renewable energy project development experiences and real

estate construction experience to the party.

Full service

One would be hard pressed to find a clean energy company that can offer the full

range of services needed that we provide: land development, environmental engi-

neering & studies, design/build, permitting, feasibility studies, consulting, energy

efficiency review and deployment, solar/wind/geothermal/fuel cell resource as-

sessment and product design & installation, PPA / conventional financing, EPC

(engineer, procure, construct), LEED, service, O&M (Operations & Maintenance),

backup power/energy storage, monitoring, repair, and customer billing systems.

Energy Efficiency

Review (EER)

As a value added service, we offer every customer an EER as part of their PPA or

conventional financed purchase of a renewable energy system. Nearly any struc-

ture has “low hanging fruit” energy efficiency options – including lighting, tankless

water heaters, programmable thermostats, and more – that can reduce energy

demand with a fast ROI and lower the size of the required renewable energy sys-

tem.

RISK KEY POINTS HOW WE MITIGATE IT

Natural

Disaster Loss of equipment, loss of revenue

Insurance includes: property, business

interruption, builders & installation risk,

general liability, Errors & Omissions,

Directors & Officers, Worker’s Comp.

Lawsuits Liability for design, installation, officers &

directors exposure, etc. See Solar SPF coverage above.

IRS

Recapture

If the project sustains a major loss,

project owners are liable for recapture of

the Federal Investment Tax Credits,

Renewable Energy cash grants,

accelerated Depreciation

Solar SPF insures against the loss of all

federal tax related benefits to projects in

the event of a major loss that is not

rebuilt within one year.

REC

Revenue

Renewable Energy Certificates (RECs) are

tradable, include the carbon credits, and

are a major source of supplemental

revenue.

Solar SPF insures against these losses.

Building

Foreclosure

Property is foreclosed upon for any

reason.

Energy produced by our equipment can

be sold back to the utility.

Customer

Default

Customer goes out of business or cannot

pay for any other reason.

We disconnect their service, begin selling

the power back to the utility; we have

trade risk credit insurance & submit a

claim for payment (covers up to 2 years).

Construc-

tion Risk

Will the contractor complete the job, and

perform quality work that will last 20

years with minimal maintenance?

Hire only large EPC contractors that can

wrap the construction project with a

completion bond and make them provide

the Operations & Maintenance contract.

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Pristine Sun LLC

$1 Billion in energy assets by 2015

For supporting documentation, Excel models, and sample executed con-

tracts, request our mutual NDA or send us your mutual NDA.

COMPANY PROJECT FUNDING POLICIES:

1. We will not pay “due diligence” fees or any other “up front” fees prior

to receipt of a binding, executed term sheet.

2. We will not grant exclusive funding rights to any party.

3. We are willing to be flexible on legal structure and equity participation

for funding partners, as needed.

Contact for more info:

Troy Helming at [email protected] or M 949-910-0442, OR

Joshua Crooker at [email protected] or M 913-424-9478.

Contact Info

California Office:

4695 MacArthur Court, 11th Floor

Newport Beach, CA 92660

Headquarters:

970 W. Broadway, Suite E-393

Jackson Hole, WY 83002-3000

www.PristineSun.com

Pristine Sun LLC

P: 307.200.7075

F: 866.593.9753

E: [email protected]