Photovoltaics versus Concentrated Solar Power

1. Photovoltaics versus Concentrated Solar Power Dr. Martin Stickel ICCI International Energy and Environment Fair and Conference Isanbul, 14th May 2010

2. Fichtner GmbH & Co. KG Photovoltaics and Concentrated Solar Power Financial Results depending on Plant Location Summary Agenda

3. The Fichtner Group • Established in 1922 – still a family-owned concern • Germany’s biggest independent engineering and consultancy enterprise • More than 1700 employees worldwide – 450 in our Home Office • Project experience in 150 countries • Over 1200 ongoing projects – around 650 in our Home Office • Active on behalf of:• enterprises in the central services and utilities sector • energy-intensive industries• international development and commercial banks • government and communal institutions and authorities • Total turnover of 179 million € in 2008 – 67% international turnover 3

4. FICHTNER – Independent Engineering and Consulting Founded in 1922 and 100% family owned since then Germany’s biggest independent engineering and consultancy company Staff strength: Home office (Stuttgart) ca. 450 Total ca. 1,700 Turn-over 2008: Home office: 122 million EUR Total: 179 million EUR On a global level FICHTNER is on average involved in approx.1,200 projects with an overall investment volume of about 60 billion EUR. FICHTNERis represented in more than 50 countries worldwide.

5. FICHTNER Turkey FICHTNERhas been working for more than 40 years on various projects in Turkey Established in July 2008, FICHTNER Turkey is100% owned by FICHTNER Germany Completed numerous projects mainly in the private sector Brought together experienced international experts & local engineers/consultantsand worked on the most important projects of Turkey Vision of FICHTNER Turkey: Become one of the biggest well established engineering companies in the region Provide state-of-the art engineering and technical services to meet the demands of the growing energy market Make use of Turkey’s young population: Train local engineers and technical staff to make them compatible with international experts Use them for the most challenging projects in the region and worldwide

6. Renewable Energy Technologies Hydropower Wind Power Solarthermal Power Photovoltaic Geothermal Power Solid Biomass Sewage and Landfill Gas Biogas Biomass to Liquid (BtL) Fuel Cells

7. Our Range of Engineering and Consultancy Services • Project phaseOur serviceObjective • Concept study Development and review of Definition of approach realization concepts • Feasibility study Investigation of technical and Financing agreement/depiction of financial viability financial performance • Conceptual and Drawing up permit Construction and operation layoutengineering application documents permits • Detail engineering Drawing up tender documents Project- and client-specific tender documents • Tendering and Bid evaluation and Plant procurement to meet quality,contractaward contract negotiations time and cost requirements • Construction and installation Site supervision Functional plant • Commissioning / test operationSupervision of commissioning Production-ready plantand tests • Operation Check of routine operation Regular commercial utilization

8. Fichtner GmbH & Co. KG Photovoltaics and Concentrated Solar Power Financial Results depending on Plant Location Summary Agenda

9. Solar Irradiation in Turkey Turkey shows similar irradiation characteristics as Spain, one of the largest solar energy markets.

10. Worldwide Installed PV Supply

11. PV „Grid Parity“ in Germany Bundesverband Solarwirtschaft

12. Solar Technologies

13. Photovoltaics Source: Juwi AG

14. Photovoltaic Power - Module Types • Mono-crystalline silicon: Most efficient technology (efficiencies of around 18% (commercial) to 28% (research) • Multi-crystalline silicon: Cheaper than mono-crystalline silicon but also less efficient. Research cells approach 24% efficiency, and commercial modules approach around 16% efficiency. • Thin film: • Cheaper than crystalline silicon but less efficient. • Various materials (amorphous silicon, Cadmium Telluride, Copper Indium Diselluride (CIS)) Selection of the technology depending on: site, irradiation, temperature, costs vs. efficiency etc.

15. Photovoltaic Power - Module Tracking

16. Concentrated Solar Power (CSP) • General Technology Principle • Concentration of solar energy flow (direct irradiation required) • Conversion of Solar irradiation into high temperature heat • Conversion of high temperature heat into mechanical energy • Conventional power generation technology • Characteristics • High energy density • Conventional components used (hybridisation possible) • Economy of scale leads to large scale plants • Possibility of thermal energy storage • Types of Solar Thermal Power Plants • Parabolic Trough • Fresnel Trough • Solar Tower (Central Receiver) • Parabolic Dish (Dish/Stirling) • Solar Chimney

17. 395°C Steam 370°C, 100bar Solar HX Air and vapour Steam turbine 30 MW Cooling Tower G ~ Storage Air Air Condenser 295°C ParabolicTrough Field Electricityto the grid Parabolic Trough Source: Fichtner

18. CSP Advantage: Operation without Sunshine Thermal storage transfers excess solar heat into evening hours. • Extension of full load operation to night time hours • Reduction of part load operation (cloud transients) • Dispatchable power generation • State-of-the-art technology: Two-tank molten salt storage (E.g. AndaSol 1-3: 1050 MWh [7.5 h])

19. Trends & Expectations Capital Costs PV plants: 2.5-4 €/Wp EPC prices depending on module type and tracking system Decreasing module costs (future 1€/Wp), i.e. even lower EPC prices Capital Costs CSP plants: 4-6 €/Wp (parabolic trough, 50MW) Due to technological innovations and economies of scale decreasing electricity generation costs expected Peak load or “base load” PV: Peak load plants purely depending on global solar irradiation CSP: Possibility of energy storage & relatively high predictability of plant availability Project Capacities PV: 1kW – 50MW CSP: Parabolic trough 10MW – 300MW Fresnel 30MW (first commercial plant)

20. Fichtner GmbH & Co. KG Photovoltaics and Concentrated Solar Power Financial Results depending on Plant Location Summary Agenda

21. Feasibility of Solar Projects Plant Concept & Simulation of Electricity Generation Revenues for Electricity Sales Feed-in Tariff Plant CAPEX Plant OPEX Modelling of Project Economics Fichtner Cost Database Net present value Internal rate of return Levelized electricity costs…

22. PV Performance Projection - Example

23. PV Performance Projection - Example

24. Site Assessment Source: Google Maps

25. Site Assessment • Example: Johannesburg, South Africa

26. Sensitivity of O&M Costs

27. Sensitivity of Land Costs

28. Sensitivity of Ambient Temperature

29. Sensitivity of Direct Normal Irradiation

30. Fichtner GmbH & Co. KG Photovoltaics and Concentrated Solar Power Financial Results depending on Plant Location Summary Agenda

31. Global Annual Solar Cell Production Source: Photon

32. PV: Projection of Module Production Capacity Source: Paula Mints, Navigant Consulting, Inc., 2009

34. Summary • No general „better“ technology but project specific technology selection • Size, topography, irradiation (global / direct), Accessibility, grid condition • Feed-in tariffs • Relevance of dispatchability / storage • Design optimization required for each project • Thorough project development and due diligence process • Reliable design • “Bankable” EPC and O&M Contracts • performance and plant acceptance criteria and procedures • liquidated damages and incentive schemes • Reliable Yield Forecasts • Enormous potential for solar technologies in Turkey and worldwide

35. Contact • Whom to contact? FICHTNER GmbH & Co. KG Büyükdere Cad. 87/5 34387 Mecidiyeköy Istanbul Turkey Phone 212- 2171767 Fax 212-2178124 Mobile 0549-2171775 E-Mail Rabia.Recla@fichtner.de www.fichtner.com.tr FICHTNER GmbH & Co. KG Sarweystraße 3 70191 Stuttgart Germany Dr. Martin Stickel Manager PV / Solar Technologies Phone +49 (0)711 8995-684 Fax +49 (0)711 8995-495 Mobile +49 (0) 172 6358294 E-Mail martin.stickel@fichtner.de www.fichtner.de

36. Typical Project Constellation Investor Lender Insurance company Equity Loans Policies Solar Project Special Purpose Vehicle (SPV) Operation Contract Project Rights Developer Management O&M Contract Power purchase agreement EPC Contract Utility Service Company EPC contractor(s) Objectives: • Implementation of a long life power plants with high energy yield and availability • Proper and safe operation complying with the relevant requirements • Low cost, high return on investment

37. Typical Solar Power Technical Due Diligence Phase I: Pre-Financial Close Due Diligence • Project structure and obligations of project parties • Solar radiation measurements and long-term global solar radiation assumptions • Technical concept such as layout, grid connection, civil works • Energy yield assessment as to the reliability of the input data, simulation, methods and results (SOLPRO / PVSYST) • Suitability of site (e.g. radiation, temperature, site complexity, soil conditions) • Contracts / project agreements including mainly: EPC-Contract, grid connection agreement, PPA, O&M, technical and administrative operation • Adequacy of the technical warranties and verification procedures (e.g. performance test, availability, technical characteristics) • Qualification of involved parties, QC/QA concept • Permits and licenses (status, constraints e.g. due to noise, etc.) • Project insurances • Time schedule / • Project management / risk management • Financial model: elaboration of model or providing input data to bank’s / financial advisor’s model • Analysis of project sensitivities / risk assessment Facilitate investment / financing decisions Conceptual study and decision-making phase Engineering and contract award Construction Operation

38. Typical Solar Power Technical Due Diligence Phase II: Construction Monitoring • Construction monitoring (compliance with contract / specifications) • Compliance with project schedule • Review of EPC contractor‘s / owner‘s progress report • Site and workshop inspections • Preparation of monthly or quarterly progress reports Facilitate investment / financing decisions Phase III: Testing and completion certificate Conceptual study and decision-making phase • Certification of completion • Review of commissioning and of trial operation • Attendance and monitoring of the performance and reliability tests • Review of performance test results in view of liquidated damages requests • PV plant installation and mounting inspections Engineering and contract award Phase IV: Monitoring during term of project loan facilities Construction • Carry out annual site visits • Preparation of (semi-) annual operating status reports including • operating performance (availability, power performance, energy yield) • maintenance and extraordinary events Operation

40. PV World Market 2008 Bundesverband Solarwirtschaft

41. Technologies Planning Water and Infrastructure IT, Economics and Finances Integrated Expertise Energy Technology Comprehensive technological know-how as foundation • conventional technologies • innovative technologies / renewable energies Power Supply Extensive planning experience in all project phases Classical planning services are rounded off by our over-arching expertise in consultancy Environmental Technology Consultancy Broad-based range of services from one source Complete solutions on a sound technical and economic footing

42. Integrated Solar Combined Cycle (ISCC) Stack Exhaust 100°C 395°C Steam 540°C, 100bar Solar HX HRSG Air and vapour Steam turbine 60 MW G ~ Storage Cooling Tower Air Air Condenser 295°C Exhaust 600°C ParabolicTrough Field Electricityto the grid Gas turbine 90 MW Solar Island Combined Cycle Island G ~

43. Solar Thermal Power Plants – Fresnel • Principle / Characteristics • Line-focussing with long mirror strips onto fixed absorber • Lower optical efficiency compared to parabolic trough • More simple design offers potentially lower investment cost • Direct steam generation in absorber (25 – 100 bar / 270 – 550°C) • Conventional water-steam-cycle (now saturated, future superheated) • Efficient use of land due to compact design • Status • Relatively new technology • Several pilot plants in operation in Australia, Spain and USA • First pre-commercial demonstration plant for electricity generation • (5 MWe) started operation end of 2008 in California • First large scale plant shall start operation in 2012 in California • using Ausra’s Compact Linear Fresnel Reflector technology. • New 30MW project announced in Spain, recent large investment by Swiss utility

44. Solar Thermal Power Plants – Solar Tower • Principle / Characteristics • Tracked field of mirrors („heliostats“), point focussing (factor > 500) • Concentration on small area on top of the tower („receiver“) • High concentration factors = high temperatures (up to 700°C) • High solar-electric efficiency due to higher temperatures • Different heat transfer fluids (molten salt, air, water/steam) • generation of steam by heat exchanger • conventional water-steam-cycle • Status • Potential successfully demonstrated in several large pilot plants • Solar Tower technologies at different development stages • First two commercial plants in operation in Spain (PS 10 & 20) • Several large plants (>100 MWe) under development in US • Despite first commercial plants still more R&D needed

45. PV related services • technical due diligences - on behalf of lenders as well as investors • techno-economic feasibility and conceptual studies • yield projections • specifications for large-scale PV installations • check of construction and operating contracts - EPC and O&M - under their technical and commercial aspects • supervision of construction and progress monitoring • participation in acceptance tests • verification of electricity yields during operation • other PV related technical advisory

46. Methodology

47. Methodology – Financial Calculation • Levelized electricity costs (LEC) in €/kWh It Investment expenditures in the year t in € MtOperations and maintenance expenditures in the year t in € Et Electricity generation in the year t in kWh i Discount rate n Life time of the system in years

48. Site Assessment • Nassau, Bahamas

49. Sensitivity of Wind Speed

50. Extract of Reference Projects – Solar Thermal Spain, AndaSol-1, -2, -3: Three Solar Rankine Cycle Plants with storage, each 50 MWe Spain, PS-10 10 MW Central Receiver Plant BMU / KfW, ZIP Program Ten research projects for Market Introduction of Solar Technology Greece, Theseus AE Project Company 50 MW Solar Rankine Cycle Plant Spain, RentaSolar S.A. Project Company for PV Power Plants in Spain Abu Dhabi: Design and Engineering 100 MWe CST Plant Arizona, USA Project Development for 250 MWe Solar Rankine Cycle Plant India, Mathania 140 MWe ISCC (solar 30 MWe) World Bank Global Market Initiative (GMI)EM-Power Botswana Site Selection and Feasibility Study for 200 Mwe CST Plant Egypt, Kuraymat: 150 MWe ISCC (solar 20 MWe) Morocco, Ain Beni Mathar 400 MWe ISCC (solar 20 MWe) Jordan Project Development for 50 MWe Solar Rankine Cycle Plant Australia Site Selection and Feasibility Study 200 MW CST Plant Egypt, El Nasr Solar Process Heat Plant