10 MW Waste-to-Energy Transaction and Investment Advisory
K&M was hired by one of the industry’s leading integrated waste technologies solutions provider in the region. The client’s 10 MW Waste to Energy pilot project innovation is a first of its kind in Kenya. The project is based on three specific forms of biomass: municipal solid waste, agricultural crop residues and livestock waste or manure. The WtE pilot which is also phase 1 of the project will be located in Kibera, an informal settlement in Nairobi. This is a single line facility with a capacity of 300 tons per day, and a total of 100,000 tpa. For this pilot phase, the output will be biomethane and electricity. The expanded facility will have a capacity of 250,000 tpa and the outputs will be biomethane, ethanol and electricity. K&M Advisors will provide financial / commercial advisory services with the primary objectives of (i) raising the necessary funds to complete project development and (ii) successfully achieving project financial close for the pilot project.
K&M was contracted to assist a private client on the negotiation of the Regasified LNG Sale and Purchase Agreement (RLSPA). A draft version of the RLSPA was submitted to the client on March 31, 2021. In addition to the RLSPA, the LNG supplier proposed that the client and themselves enter into a Pipeline Interconnection Agreement (PIA) that will govern the construction of the pipeline from the LNG terminal to WEB’s battery limit. K&M will review and comment on the RLSPA and PIA.
Africa GreenCo has retained K&M Advisors to advise on the development of the company’s procurement procedures and policies. In Zambia, Africa GreenCo will act as an intermediary offtaker and service provider, purchasing power from renewable IPPs and selling that electricity to utilities and private sector offtakers (i.e. commercial and industrial users) as well as other markets of the Southern Africa Power Pool (SAPP). Therefore, Africa GreenCo must have procurement policies and processes that reinforce its role as a credible, independent party. K&M is working closely with Africa GreenCo to develop procurement policies, procedures and documents; and a due diligence and appraisal framework through which Africa GreenCo determines how, and from whom, it purchases and sells power. K&M will: • Review, assess, and recommend changes to existing documents regarding procurement
• Develop procurement policies and associated rules and procedures best suited to meeting the evolving needs of GreenCo
• Develop project appraisal and due diligence framework, including bid documents and associated templates
CUC is considering LNG as a new fuel for power generation. There are several LNG import solutions that Cayman could consider, and the majority of them are likely to result in a cost of fuel that is lower than diesel. However, before proceeding with the development of a specific solution, CUC wants to develop an LNG-to-Power strategy that considers all the technically viable LNG-to-Power options, and narrows the options to two or three that have the lowest costs, a manageable level of risk, and could be implemented in a reasonable timeframe.
IFC has retained K&M Advisors to set up and manage a virtual data room (VDR) platform for the Shire Valley Irrigation Project, for which is IFC assisting with the procurement of the O&M contract and negotiation of water purchase agreements with off-takers. K&M is working closely with IFC to set up, manage and monitor activity within the VDR to help facilitate timely communication and information sharing with the bidders.
K&M was the technical advisor and consulting engineer to KTI Energy and Resources Services, Inc., for a 5 million gallon per day water desalination plant and municipal waste-to-energy facility capable of generating 40 MW (net) for sale to the grid to be completed for the Defense Housing Authority in Karachi. This project was offered on a build-own-operate basis. The scope of services for the contract included the following: obtaining USAID/TDP grant-in-aid for the feasibility study, developing of the Preliminary Feasibility Report, assisting the client and its agents in conducting negotiations in Pakistan for power purchase and water supply agreements, assembling the financial package, participating in the development of the procurement documents, serving as the Owner’s Engineer for construction contract negotiations and construction and start-up period.
K&M was engaged by the World Bank to assist the Jamaica Public Service Company (JPSC) to structure, competitively procure and negotiate the 60 MW Rockfort IPP. The project is located in an industrial area at Kingston Harbor, and consists of 3×20 MW low speed MHI diesel units and all associated support facilities. The generators are of a two stroke valveless design and use heavy fuel oil. K&M’s work was organized in two phases.
During Phase I K&M reviewed the existing legal, regulatory and institutional framework and identified specific constraints to be addressed before private power projects could be realized. During Phase II K&M analyzed the project’s feasibility; drafted and issued prequalification documents; identified, analyzed and allocated risks; developed the contractual structure; draft tender documents and project agreements; supervised the tendering process; and participated in the bid evaluation, developer selection and contract negotiations.
This was the first IPP in the Caribbean and in Jamaica to reach financial close. A principle feature of the financing package was a credit enhancement to facilitate use of Caribbean Basin Projects Financing Authority (CARIFA) 936 bond financing. Additionally, the project secured the first financing offered by Jamaica’s newly established Private Sector Energy Fund, which was developed by the World Bank to promote and facilitate private sector participation in energy development. The US$114 million project reached financial close in 1994 and commercial operation in 1996.
K&M was engaged by USAID to assist the Jamaica Public Service Company, Ltd., the state-utility, to establish the regulatory and technical conditions necessary for the development of private power projects on a turnkey basis. K&M’s scope of work included: identifying regulatory and legal barriers, prepared pre-qualification notices and documents used to short-list project developers, establishing evaluation criteria for the prequalification process, preparing construction contracts, preparing tender documents, and writing Implementation and Power Purchase Agreements. Directly resulting from K&M’s work, the Jamaica Public Service Company procured private turnkey contracts for over 200 MW of additional capacity to its system. This represented an approximate 37% increase in installed capacity over the entire national grid system.
K&M was engaged by USAID to serve as IPP consultant for the private sector rehabilitation, lease and operation of the 100 MW San Francisco Private Power Project in Panama City. K&M assisted the Institución de Recursos Hidraúlicos y Electrificación (IRHE) by identifying changes to the legal and regulatory framework needed to enable IPPs, preparing the bid documents, and drafting project agreements. The project agreement became the model document for attracting private sector participation in the energy sector and provided the initial framework for power sector reform in Panama.
K&M served as primary technical consultants to the World Bank, Office of Energy and Infrastructure, and the U.S. Agency for International Development (USAID) to establish guidelines for tendering and evaluating private power projects. Published in 1994, “Submission and Evaluation of Proposals for Private Power Generation Projects in Developing Countries” IEN Occasional Paper No. 2, remains the standard process and conditions for international competitive bidding of private power projects. The Guidelines are designed to help governments of developing countries address impediments faced by the private sector in power generation development and investment.