Wartsila Oyj Abp · OMXHEX:WRT1V
Wartsila Oyj Abp — Wärtsilä — Investor Presentation (March 2018)
10 slides from Wartsila Oyj Abp's investor presentation, Mar 23, 2018
Slide 1: UK presentation
WÄRTSILÄ ENERGY SOLUTIONS UK presentation Jan Andersson 1 © Wärtsilä PUBL I C 23/03/2018 Wärtsilä Energy Solutions / Jan Andersson
Slide 2: Data Center Business Model electric only
BUSINESS MODEL Data Center Business Model electric only: IPP builds gas engine power plant on or near Data 1 Center site and includes: Utility • Operation, Maintenance, and Dispatch • All permitting and interconnection • Fuel supply agreement Data Center Primary IOU Peaking 3 Power - PPA 4 Power - P
Slide 3: Project timeline
BUSINESS MODEL Project timeline From year 4 and onwards • Grid connection is established • Data Center buys power from utility During year 1 – 3 • IPP operates as a merchant plant on • IPP provides the Data Center with power various markets • IPP installs engines to comply with redundancy • IPP plan
Slide 4: Year 1-3 and Year 4 and onwards
BUSINESS MODEL Year 1-3 Year 4 and onwards Before the grid connection is established the IPP When the grid connection is established the IPP supplies the required power to the Data Center operates as a merchant plant on Day ahead, Intraday and Balancing markets Data Center pays capacity fee for the
Slide 5: Trading model with historical data to assess the IPP plant feasibility
BUSINESS MODEL Trading model with historical data to assess the IPP plant feasibility Trading assumptions Technical solution Financial • Economical lifetime: 20 years • Equity/debt: 30% / 70% • Return on investment: 9% WÄRTSILÄ • Investment cost: 500 EUR/kW • Interest rate: 6% • Efficiency, net: 45
Slide 6: Market trading model
BUSINESS MODEL Market trading model Intraday and/or balancing market Day ahead market • After day ahead market trading • Daily auction where prices for next day half-hours shifts to intraday or balancing are cleared markets • Bids from generators and consumers • In UK National Grid buys and sells •
Slide 7: IPP trading model
BUSINESS MODEL Trading model Day before Delivery GRID delivery half hour Keeping grid in balance Day ahead Market Balancing Daily auction IPP places bid Generation for DAM market Continuous trading If cleared, IPP is committed IPP Real time trading to generate 7 © Wärtsilä PUBL I C 23/03/2018 Wärtsi
Slide 8: Net present value and project IRR
BUSINESS MODEL Description UNIT High speed 2016 2017 Day ahead market (DAM) Energy MWh 0 73 372 74 516 Costs MEUR 0 3.86 4.43 Revenues MEUR 0 5.66 5.43 Balancing market (BM) Energy sold MWh 0 34 710 49 408 Energy purchased MWh 0 25 966 16 936 Costs MEUR 0 2.69 3.62 Revenues MEUR 0 2.82 3.96 DAM cost
Slide 9: Cost of IPP emergency contract plus back-up energy is cheaper than own back-up generators
BUSINESS MODEL Cost of IPP emergency contract plus back-up energy is cheaper than own back-up generators Own back-up plant IPP back-up Cost of back-up power: 0.55 MEUR Cost of back-up power Cost of capital: Fixed O&M: 2.09 MEUR 0.44 MEUR ~0.20 MEUR TOTAL COST: 3.08 MEUR Maximum emergency contract va
Slide 10: Jan Andersson contact details
Jan Andersson jan.andersson@wartsila.com +358 40 715 7890 www.smartpowergeneration.com/data-centers