Presented by Daniel E. DuBois. Lessons Learned Developers – dont fall in love with your projects What do I mean ?

Presented by Daniel E. DuBois

Lessons Learned

• Developers – don’t fall in love with your projects

• What do I mean ?

Lessons Learned

• Is your project doomed (and you don’t know it)?

• Some clues – 1. Unrealistic economics2. The community hates it (or you)3. No transmission4. It’s a money pit

Unrealistic Economics

• Major components – Scale– Wind resource– Capital costs (turbines + BOP)– Expected return– O&M (planned & unplanned)– Revenue

Unrealistic Economics

• Create some practical guidelines • Example – (assumptions)

– Scale = 50MW (land – 100 acres /WTG)– Wind = 7 m/s (30% NCF)– Installed costs = $2,000 / MW installed– O&M = $50-70k/WTG – Projected return 9% IRR

• Revenue = $80/mWh escalated at 2%

Unrealistic Economics

Wind vs. Required Revenues

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$0.02

$0.04

$0.06

$0.08

$0.10

$0.12

$0.14

$0.16

6.0 6.5 7.0 7.5 8.0 8.5

Average Wind Speed in M/S

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Based on the production of a 50MW project requiring a 9% IRR Unlevered Return

Community relations

• Positive community relations is critical– It is the root of every permitting process

• Is it not going well?– Some clues –

• Misinformation (rumors)• Organized opposition• Law suits

Community relations

• What to do?– Improve communication– Regular local presence (local office)– Town hall meetings– Enlist supporters (land owners)– Monthly newsletter

Interconnection vs. Transmission

• Do you have interconnection problems ?

– Distance - On-site vs. miles– Property rights– Competition

• Do you have transmission problems?

– Deliverability standard– Energy/capacity– Curtailment

Money Pit

• Is your project a money pit?– Are you over budget?– Unforeseen expenses

• Law suits• Transmission studies

– Are you behind schedule• Permitting delays

• Contingency planning

Conclusions

• Evaluate development projects – Objectively– Realistically– Often