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Transcript of Windshare 2008 AGM Welcome Members. Windshare 2008 AGM Welcome & Introductions 2007 Windshare Board...
Windshare Windshare 20082008
AGMAGM
Welcome MembersWelcome Members
Windshare 2008 AGM
Welcome & IntroductionsWelcome & Introductions
2007 Windshare Board
Paula BoutisJohn BinnsRiki BurkhardtEvan FerrariJennifer JefferyRose KudlacStewart Russel
Treasurer - David Robertson
Introduction to:
Joanna SlezakRichard Lawrence
Deb Doncaster – Community Power Fund
Windshare 2008 AGM
Agenda Agenda (motion to approve agenda)(motion to approve agenda)
1. Welcome and Introductions2. Agenda Review3. Approval of minutes from 2007 AGM4. Recognition of Board & Staff: 5. Board Elections:6. WindShare Board Report – A year in Review:
a) Year Overview b) Administration
Coffee Break7. WindShare Board Report – Continued:
c) Technical and Production c) Technical and Production d) Financial Report
8. New InvestmentExPlace scenarios
9. Election Results 10. ADJOURNMENT 11. ANNOUNCEMENTS
Windshare 2008 AGM
“Energy and persistence alter all things.”
Benjamin Franklin
Windshare 2008 AGM
“The definition of insanity is doing the same thing over and over and expecting different results.”
Benjamin Franklin
Windshare 2008 AGM
APPROVAL OF MINUTES 2007 AGM
Riki BurkhardtRiki Burkhardt
Windshare 2008 AGM
RECOGNITION
Rose KudlacRiki BurkhardtPaula Boutis
Windshare 2008 AGM
BOARD ELECTIONS
Seven Member BoardThree year termsOpen to members and members in waitingThree vacancies to fill tonight
Dianne SaxEvan FerrariTed Tracewicz
Nominations from the floor?
Stewart Russell Stewart Russell
Windshare 2008 AGM
BOARD ELECTIONS
Each Candidate will have 2 minutes
Windshare 2008 AGM
BOARD ELECTIONS
-Can vote for up to three people-Election ballots to be submitted into Ballot Boxes-Ballots will be counted over Coffee Break
-Board can appoint new members during the year but must ratify new members at next AGM
Windshare 2008 AGM
WINDSHARE BOARD REPORT
WINDSHARE BOARD REPORT a) Year Overview b) Technical and Production c) Financial Report
Windshare 2008 AGM
WINDSHARE BOARD REPORT Overview of 2007Overview of 2007 Original Goal – multiple turbinesOriginal Goal – multiple turbines Environmental CO2 emission reductionEnvironmental CO2 emission reduction Board continues to look at ways of Board continues to look at ways of
increasing production reducing costs reducing our risk making us profitable.
Financial – not there yetFinancial – not there yet Challenging year for production and maintenance 1 turbine exposes us to higher financial risk while multiples reduce risk
Main Bearing issue - future Financials demonstrate the difficulties that this situation presents us
New Investments – trials and tribulationsNew Investments – trials and tribulations Lakewind – ExPlace Other possible opportunities
Windshare 2008 AGM
WINDSHARE BOARD REPORT What happened to Lakewind What happened to Lakewind Project?Project? Worked with TREC & Countryside Energy CooperativeWorked with TREC & Countryside Energy Cooperative
10 megawatt (5 turbine) project near Kincardine,
On hold for up to five yearsOn hold for up to five years Orange Zone - Ontario Power Authority (OPA) agreement Orange Zone - Ontario Power Authority (OPA) agreement
- Bruce Power - Bruce Power No new production unless generated at Bruce Nuclear Plant Many of you sent letters to the Minister of Energy decision to leave the Lakewind for another day was difficult
Windshare 2008 AGM
WINDSHARE BOARD REPORT Lakewind on Hold – Now What?Lakewind on Hold – Now What?
No potential new projectsNo potential new projects October, 2007 joint Visioning sessionOctober, 2007 joint Visioning session
Re-evaluate something close to home - ExPlace.
Windshare 2008 AGM
WINDSHARE BOARD REPORT More Tirbines at the Ex?More Tirbines at the Ex? Why more turbines at the Ex?Why more turbines at the Ex? 2005 feasibility add one turbine at ExPlace 2005 feasibility add one turbine at ExPlace
not financially feasible
Number of these issues have changed considerably Number of these issues have changed considerably since 2005, namely:since 2005, namely: Access to a long term contract - Standard Offer Program Guaranteed price for 20 years Turbine technology has improved
20% more efficient than our current turbine
Windshare 2008 AGM
WINDSHARE BOARD REPORT ExPlace Fasibility StudyExPlace Fasibility Study
ExPlace now receptive to 2 more turbines ExPlace now receptive to 2 more turbines (electricity self sufficiency by 2015)
Toronto Hydro very interested in joint ventureToronto Hydro very interested in joint venture Has potential to move quicker than Lakewind Has potential to move quicker than Lakewind Good working relationships with all associated Good working relationships with all associated
with this development and locationwith this development and location
Windshare 2008 AGM
WINDSHARE BOARD REPORT ExPlace Fasibility StudyExPlace Fasibility Study
Enabled us to conduct Feasibility study:Enabled us to conduct Feasibility study: 1) Continuing to operate only one turbine 1) Continuing to operate only one turbine 2) Adding two more turbines at ExPlace2) Adding two more turbines at ExPlace
Windshare 2008 AGM
E1E1
E2E2
Proposed Wind Turbine LocationsProposed Wind Turbine Locations
04/02/0804/02/08
Windshare 2008 AGM
Administrative CommitteesAdministrative Committees
Joint Venture (WindShare & Toronto Hydro)Joint Venture (WindShare & Toronto Hydro) Rose Kudlac, John Binns, Stewart Russell, Evan Ferrari
Technical Committee Technical Committee Rose Kudlac & John Binns, Stewart
Finance Committee Finance Committee (David Robertson, looking for new treasurer)
Communications Committee Communications Committee Jennifer Jeffery
Admin Admin Riki Burkhardt
Windshare 2008 AGM
Windshare Windshare 20082008
AGMAGM
Coffee BreakCoffee Break
Windshare 2008 AGM
WINDSHARE BOARD REPORT
John Binns
Technical and ProductionTechnical and Production
Windshare 2008 AGM
Production/TechnicalProduction/TechnicalExhibition Place Turbine•Lagerwey LW52 wind turbine •Installed Dec 2002, energy generation Jan 2003•Rotor diameter 52m, Hub height 60m•600 kW capacity (de-rated), direct drive, gearless model •AC-DC-grid AC converter •Normal rotation speed 24.5 rpm •2.5 m/s minimum wind threshold for blade rotation •Approximately 500 kilowatts energy production in winds of 11 m/sec •At 95% availability potential maximum energy generated 5,000,000KwH per year•Average energy generated 1,000,000KwH per year•4,000,000 KwH achieved June 2007
Windshare 2008 AGM
Energy RevenueEnergy Revenue
WS fiscal year October-SeptemberWS fiscal year October-September Power Purchase Agreement (PPA) Jan 2003-Power Purchase Agreement (PPA) Jan 2003-
Dec 2006-$0.0969/KwHDec 2006-$0.0969/KwH Hourly Ontario Energy Price (HOEP) Jan Hourly Ontario Energy Price (HOEP) Jan
2007-27 April 20072007-27 April 2007 Renewable Energy Standard Offer Renewable Energy Standard Offer
Programme (RESOP) 27 April 2007 onwards-Programme (RESOP) 27 April 2007 onwards-$0.11/KwH$0.11/KwH
Windshare 2008 AGM
Sep-March
701,963
866,003
946,342962,316
626,250
464,314
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
2003 2004 2005 2006 2007 2008
Year over Year ProductionWindshare Turbine
Kw h
Windshare 2008 AGM
Cumulative Production Windshare Turbine
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
Kwh
2003
2004
2005
2006
2007
2008
2003 - - - 33,350 142,352 234,454 345,088 456,436 523,192 589,838 622,399 701,963
2004 71,407 183,920 291,097 431,322 493,860 572,351 673,755 747,825 806,404 832,930 855,426 866,003
2005 119,043 219,466 368,612 455,239 533,101 614,604 698,449 749,425 793,247 839,062 893,746 946,342
2006 49,757 196,400 351,285 486,321 622,141 695,292 741,951 803,486 861,529 920,771 954,815 962,316
2007 14,143 34,871 99,556 121,706 231,308 358,584 480,448 510,257 533,956 540,327 582,010 626,250
2008 63,295 136,460 242,884 388,656 464,314
1 2 3 4 5 6 7 8 9 10 11 12
Windshare 2008 AGM
Production by Fiscal MonthWindshare Turbine
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
Oct Nov Dec Jan Feb Mar Apr Ma Jun Jul Au Sep
Kwh
2003
2004
2005
2006
2007
2008
Windshare 2008 AGM
Production TechnicalProduction Technical
Technical Management Joint Venture Committee
WindShare – Evan Ferrari, Rose Kudlac, [Dave Robertson], Stewart Russell, John Binns
THESI –Jack Simpson, Leo Guidolin, Joyce MacLean Bettink NV McDowell Electrical WS Technical Committee-volunteers
Technical communication Online operations log (Yahoo)– captures information to
create a database of incidents and their resolutions
Windshare 2008 AGM
Future ChallengesFuture Challenges
Main bearing replacement (crane rental)Main bearing replacement (crane rental) OverheatingOverheating LWMS (Shoebox)LWMS (Shoebox)
Windshare 2008 AGM
““Sagging cables”Sagging cables”Replacement of power cable Replacement of power cable clampsclamps 9 x 3 component sandwich clamps, holes 9 x 3 component sandwich clamps, holes
drilled to 1” rather than 2.5cm diameterdrilled to 1” rather than 2.5cm diameter Slippage of up to 20cm between clampsSlippage of up to 20cm between clamps Single prototype machined and drilled, Single prototype machined and drilled,
installed to test for slippage.installed to test for slippage. New clamps machinedNew clamps machined Replaced over 3 Sundays, finished Jan 27, Replaced over 3 Sundays, finished Jan 27,
20082008 Cost $450 for 9 clamps, labour $0 Cost $450 for 9 clamps, labour $0
Windshare 2008 AGM
Windshare 2008 AGM
Windshare 2008 AGM
Windshare 2008 AGM
Windshare 2008 AGM
WINDSHARE BOARD REPORT Treasurers ReportTreasurers Report
Dave Robertson
Windshare 2008 AGM
Treasurer’s ReportTreasurer’s Report
Audited Financial StatementsAudited Financial Statements Balance Sheet Operations statement
Income TaxIncome Tax FY 2008 ForecastFY 2008 Forecast
Windshare 2008 AGM
Treasurer’s ReportTreasurer’s Report
Auditors:Auditors: Cowperthwaite Mehta Chartered Accountants
Windshare 2008 AGM
Treasurer’s ReportTreasurer’s Report
Fiscal Year – Oct 1, 2006 to Sept 30, 2007Fiscal Year – Oct 1, 2006 to Sept 30, 2007 Low income because:
Large amount of down time for repairs Paid at market rates not RESOP or original 9.67 cent per Kwh.
High operating costs to recover from downtime High operating costs direct result of no warranty Low overhead expenses Negative operating income Refunds to shareholders for shares not replaced Significant reduction in cash Cash shortage funded by EC loans
Windshare 2008 AGM
Balance SheetBalance SheetAssets (page 1)Assets (page 1)
Current AssetsCurrent Assets 20072007 20062006
CashCash $169,305$169,305 $169,788$169,788
Accounts ReceivableAccounts Receivable 18,57218,572 67,21067,210
Inventory –partsInventory –parts 10,02710,027 10,02710,027
Prepaid expensesPrepaid expenses 17,03917,039 16,70616,706
TOTALTOTAL $214,943$214,943 $263,731$263,731
Windshare 2008 AGM
20072007 20062006
Capital AssetsCapital Assets 615,984615,984 $657,264$657,264
Funds held in escrowFunds held in escrow 291,503291,503 307,066307,066
TOTALTOTAL $1,122,430$1,122,430 $1,228,061$1,228,061
Windshare 2008 AGM
Balance SheetBalance SheetLiabilities/Equity (page 1)Liabilities/Equity (page 1)
Current LiabilitiesCurrent Liabilities 20072007 20062006Accounts Payable & Accrued LiabilitiesAccounts Payable & Accrued Liabilities $9,422$9,422 $17,793$17,793Current Portion DebtCurrent Portion Debt 150,000150,000 150,000150,000Deferred RevenueDeferred Revenue 75,00075,000 75,00075,000
TOTAL CURRENT LIABILITIESTOTAL CURRENT LIABILITIES 234,422234,422 242,793242,793
PHASE II FUNDS IN ESCROWPHASE II FUNDS IN ESCROW 291,503291,503 307,066307,066
Member EquityMember EquityMembers’ Equity Share CapitalMembers’ Equity Share Capital 776,423776,423 786,923786,923Accumulated DeficitAccumulated Deficit (179,918)(179,918) (108,721)(108,721)
TOTAL MEMBER EQUITY TOTAL MEMBER EQUITY $596,505$596,505 $678,202$678,202
TOTALSTOTALS $1,122,430$1,122,430 $1,228,061$1,228,061
Windshare 2008 AGM
Debt FinancingDebt Financing
Environment CanadaEnvironment Canada Loans Loans $150,000 loan 0% interest Continuing to negotiate reuse of funds in next
project
Windshare 2008 AGM
Members’ Equity and Funds in Members’ Equity and Funds in EscrowEscrow(page 1)(page 1)
Members’ EquityMembers’ Equity 20072007 20062006
Preference SharesPreference Shares $776,000$776,000 786,500786,500
Membership SharesMembership Shares 423423 423423
Funds in EscrowFunds in Escrow 20072007 20062006
Preference SharesPreference Shares 291,503291,503 307,066307,066
Membership SharesMembership Shares 193193 202202
Windshare 2008 AGM
Balance SheetBalance SheetLiquidity Liquidity
Negative working capital $<19,479> (2006, $20,938).
Working capital decreased by operating loss.
Windshare 2008 AGM
Statement of OperationsStatement of Operations
Total energy delivered to the grid for Sept. 30, 2007 Total energy delivered to the grid for Sept. 30, 2007 year end was 626,250 KWH (2006; 946,342 kWh) year end was 626,250 KWH (2006; 946,342 kWh) (50% WindShare’s)(50% WindShare’s)
IssuesIssues Downtime reduced revenue Low rate reduced revenue High operating expenses
No warranty Local electrical contractor Brought in Bettink from Europe Regular maintenance by electrical contractor Management on site no longer volunteer
Windshare 2008 AGM
Statement of Operations Statement of Operations Revenues (page 2)Revenues (page 2)
RevenueRevenue 20072007 20062006Power Sales & Power Sales & Management FeesManagement Fees
$18,977$18,977 $46,621$46,621
Windpower Production Windpower Production Incentive ($0.12/kWh)Incentive ($0.12/kWh)
3,2903,290 5,7595,759
Interest & Exchange gainInterest & Exchange gain 7,7257,725 8,2428,242
TotalTotal $22,267$22,267 $60,622$60,622
Windshare 2008 AGM
Statement of Operations (page Statement of Operations (page 2)2)
ExpensesExpenses 20072007 20062006Turbine O&MTurbine O&M $30,817$30,817 $24,472$24,472
InsuranceInsurance 9,3299,329 9,8839,883
Land LeaseLand Lease 1,0001,000 1,0001,000
Realty taxesRealty taxes 3,8503,850 5,7985,798
Professional FeesProfessional Fees 7,6797,679 17,05717,057
Office expensesOffice expenses 6,7126,712 5,3255,325
Interest & Bank ChargesInterest & Bank Charges 522522 424424
TotalTotal $59,909$59,909 $63,959$63,959
Windshare 2008 AGM
Statement of Operations Statement of Operations Operating Income & Net Loss Operating Income & Net Loss (page 2)(page 2)
Operating Income & Net LossOperating Income & Net Loss 20072007 20062006
RevenuesRevenues $22,267$22,267 $60,622$60,622
ExpensesExpenses $59,909$59,909 63,95963,959
(Loss) from Operations(Loss) from Operations (37,642)(37,642) (3,337)(3,337)
AmortizationAmortization 41,28041,280 41,28041,280
Net Income (Loss)Net Income (Loss) $(78,922)$(78,922) $(44,617)$(44,617)
Deficit, openDeficit, open (108,721)(108,721) (64,104)(64,104)
Deficit, closeDeficit, close $(179,918)$(179,918) $(108,721)$(108,721)
Windshare 2008 AGM
Statement of Operations Statement of Operations Statement of Cash FlowsStatement of Cash Flows
Sources/Uses of CashSources/Uses of Cash SourcesSources
Preference and Membership shares
UsesUses Refunds to members Operating loss
Windshare 2008 AGM
Income TaxIncome Tax
Non-capital losses can be carried forward Non-capital losses can be carried forward and applied to future taxable incomeand applied to future taxable income
Both CCA and prior losses deductible Both CCA and prior losses deductible against future income afteragainst future income after
Windshare 2008 AGM
2007 Forecast2007 Forecast
2007 budget as yet not set. PPA rate to be 2007 budget as yet not set. PPA rate to be negotiated as to start date of RESOP negotiated as to start date of RESOP
Use conservative estimate for operating costsUse conservative estimate for operating costs Operating costs include maintenance contractOperating costs include maintenance contract Projections done for revenue & expenses for one Projections done for revenue & expenses for one
turbine and/or 2 additional turbines in budgetturbine and/or 2 additional turbines in budget 2007 budget shows operating surplus but net loss 2007 budget shows operating surplus but net loss
after amortization. after amortization. Continues to be not sustainable in the long term. Continues to be not sustainable in the long term.
Risk of more downtime and related repair costs Risk of more downtime and related repair costs remains high with no warranty.remains high with no warranty.
Not enough economies of scaleNot enough economies of scale
Windshare 2008 AGM
Acceptance of AuditedAcceptance of AuditedFinancial StatementsFinancial Statements
Motion:Motion: To accept the Audited Statements for TREC To accept the Audited Statements for TREC
WindShare Co-operative (No 1) Incorporated WindShare Co-operative (No 1) Incorporated for Fiscal Year ended September 30, 2007for Fiscal Year ended September 30, 2007
Windshare 2008 AGM
Appointment of AuditorsAppointment of Auditors
Board of Directors recommendation…Board of Directors recommendation…Motion:Motion: That Cowperthwaite Mehta Chartered That Cowperthwaite Mehta Chartered
Accountants be re-appointed auditors for Accountants be re-appointed auditors for TREC WindShare Co-operative (No 1) TREC WindShare Co-operative (No 1) Incorporated for Fiscal Year 2008Incorporated for Fiscal Year 2008
Windshare 2008 AGM
ExPlace Feasibility
OPTIONS
OPERATE LAGERWEY ALONE BUILD 2 NEW TURBINES DO BOTH
Windshare 2008 AGM
ExPlace Feasibility
AssumptionsAssumptions
Finance new Enercons with debentures (4%)Finance new Enercons with debentures (4%) Discount rate 4%Discount rate 4% NPV measure is return to existing NPV measure is return to existing
shareholdersshareholders
Windshare 2008 AGM
ExPlace FeasibilityExPlace Feasibility
Economic feasibilityEconomic feasibility
Option NPVOption NPV
Lagerwey alone out of cash in 11 Lagerwey alone out of cash in 11 yearsyears
Enercons alone 0Enercons alone 0
Both (680k) Both (680k)
Windshare 2008 AGM
ExPlace FeasibilityExPlace Feasibility
AnalysisAnalysis
Just Lagerwey is out of the questionJust Lagerwey is out of the question Just 2 new Enercons still leaves us with the Just 2 new Enercons still leaves us with the
Lagerwey to deal with. NPV of zero means all the Lagerwey to deal with. NPV of zero means all the return would go to the debenture holders.return would go to the debenture holders.
Have not costed removal of the Lagerwey although it Have not costed removal of the Lagerwey although it is being discussed with our JV partnersis being discussed with our JV partners
Negative NPV means original shareholder Negative NPV means original shareholder investment discounted by approximately 80%investment discounted by approximately 80%
Windshare 2008 AGM
EXPlace FeasibilityEXPlace Feasibility
ConclusionsConclusions Must do something to improve outlook for Must do something to improve outlook for
shareholdersshareholders 2 new Enercons about the only available 2 new Enercons about the only available
optionoption
Windshare 2008 AGM
ExPlace FeasibilityExPlace Feasibility
NEXT STEPSNEXT STEPS Continue the analysis of the 2 new EnerconsContinue the analysis of the 2 new Enercons If positive result can be developed then If positive result can be developed then
decision will come to membershipdecision will come to membership Apply to CP Fund for additional funding to Apply to CP Fund for additional funding to
continue analysis and processcontinue analysis and process
Windshare 2008 AGM
ExPlace FeasibilityExPlace Feasibility
ANTICIPATED SEQUENCE OF EVENTSANTICIPATED SEQUENCE OF EVENTS Receive approval from NavCanReceive approval from NavCan Do final feasibility analysis for membershipDo final feasibility analysis for membership Call member meeting to decideCall member meeting to decide If approved:If approved:
Finalize negotiations with THESI Finalize negotiations with ExPlace Commence environmental screening Apply for RESOP Commence marketing of debentures
Place order with EnerconPlace order with Enercon
Windshare 2008 AGM
ExPlace Feasibility
Dave Robertson
Motion: That the WindShare Board continue to pursue That the WindShare Board continue to pursue
building more turbines at Explace (and other building more turbines at Explace (and other developments) with a goal of coming back to developments) with a goal of coming back to the membership with a new offering statementthe membership with a new offering statement
Windshare 2008 AGM
Your 2008 Board:1. Gary Zavitz2. Ted Tracewicz 3. Dianne Sax4. Stewart Russell5. Jennifer Jeffery 6. Evan Ferrari7. John Binns
Treasurer – Dave Robertson
Windshare 2008 AGM
AgendaAgenda
10. QUESTIONS & ANSWERS 9:25-9:35
11.ADJOURNMENT 9:35
12.ANNOUNCEMENTS 9:35