Accelerator
How IslandPower can help accelerate the energy transition
The Problem
Communities
Issues faced by Communities in making the transition to a sustainable low carbon economy:
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Fragile and unstable energy systems with minimal resilience
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Energy island microgrids require bespoke solutions
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High energy costs limit economic growth & capacity to invest
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Competition to meet high external energy costs fragments communities
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Exposure to climate instability
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Slow roll out of renewables
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Slow roll out of renewables
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Communities lack market power compared to wholesale consumers in dealing with developers
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Perverse market incentives for fossil fuelled generation & against reduction in energy use
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Centralised power networks concentrate risk in single points of failure
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Absence of neutral objective energy advice.
Investors
Issues faced by Investor in Community energy infrastructure:
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Lack of Upside - levelised Cost of Energy approach acts against participation in efficiency gains
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Political Risk - changes in energy policy threaten financial returns
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Market Risk - from volatility and illiquidity
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Rent - seeking - incumbent monopolies impede adoption of new technology
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Obsolescence - from rapidly evolving technology
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Commoditisation - limits returns
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Credit Risk - communities lack scale
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Performance Risk - over-optimistic forecasting.
Developers
Issues faced by Developers of community projects:
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Access limited by community suspicion of developer motivations
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Transactional model acts to minimises build quality and efficiency
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Poor co-ordination with exiting networks and technology
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Market based mechanisms results constrain use of production capacity
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Limited access to community-scale capital at reasonable rates
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Complexity & cost of community investment legal design
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Political risk from tariff and policy change
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Macro projects favoured over micro due to economies of scale.
The Solution
Communities
How IslandPower addresses Community issues and accelerates development:
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Enabling energy independence leading to energy security and resilience
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Creating independent microgrids as Energy Islands by definition
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Combining tried & tested, adaptive technologies to tailor low cost/low carbon Natural Grids
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Working dynamically and transparently with communities for purpose & surplus, not profit
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Introducing Edge Fund investment to communities to finance development and fund long term sustainable operation
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Sharing surplus equitably via energy dividends to address community fuel poverty and provide sustainable positive returns to investors
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Designing collaborative, inclusive and adaptive legal platform with community, investor and developer participation to shared common purpose
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Empowering communities through local control and operation of energy generation providing post Covid19 sustainable employment.
Investors
How IslandPower addresses Investors issues and accelerates returns:
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Creating globally tax transparent Edge Fund agreements between investors and service providers for the purpose of investment in the transition to a zero carbon economy
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Enabling transparency while maintaining privacy through shared energy ledgers - NewClear
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Tailoring exposure to risk via short term development & long term infrastructure investment options
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Designing asset classes providing positive energy returns from revolving pools of (capital partnership) development investment and long term (prepay) "energy loans"
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Enabling simple, effective pooling of diversified risk and surplus as networked local microgrids scale into a global Natural Grids
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Tailoring exposure to risk via short term development & long term infrastructure investment options
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Transcending borders and jurisdictions through simple, effective mutual agreements which mimes professional time costs and accelerate development time-line.
Developers
How IslandPower addresses Developer issues and accelerates development:
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Converting transactional development costs into relationship through development as a service:
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Opening access to previously uneconomic microgrid markets -
Small is Beautiful
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Minimising business development time costs while accelerating time-lines
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Incentivising efficiency gains through provision of Energy as a Service
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Maximising community participation in development, operation and maintenance
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Identifying and procuring optimal combinations of energy technology partners e.g. solar/wind/storage as a service
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Identifying and procuring optimal combinations of public, private and philanthropic ('Blended Finance') Edge Fund investments
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Identifies and establish pathfinder locations and delivery partners
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Transforms high cost, high carbon microgrids to low carbon, low cost, sustainable Natural Grids.
SMART
ACCELERATOR
What is a SMART accelerator?
A Smart accelerator is a practical “Edge Fund” that identifies projects for development and operation. The fund focuses on ‘exergy’ (energy delivered) as opposed to energy produced. This allows us to rapidly build energy networked system that are dynamic, flexible, efficient and long lasting.
S.M.A.R.T. as an acronym used in project management to focus the ideas and objectives of a project on attainable goals that can be measured.
S.M.A.R.T. acceleration is achieved by identifying urgent issues and quick wins and finding the most timely and effective solution to any given problem. IslandPower's SMART accelerator builds on the innate knowledge of local communities and skill sets in order to deliver fast, quantifiable and qualifiable change.
Our innovative partnership based legal and financial structure ensure fast adoption rates for communities and technical partners. Avoiding the Political, Economic, Technological and Social/Legal (PESTEL) problems that are often a barrier to development. Central to this is our transparency.
PHASES
Opportunities are broken down into two distinct classes:
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Physical development
Identified projects that require Smart acceleration
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Financial development
Existing projects that require refinancing and further development
Investment class
Development Phase
Financial development
Investment classes have two phases:
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Development
Identified projects that require low cost, low carbon, resilient and renewable networks
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Operational
Manage projects that have been developed or refinanced by IslandPower
Both phases allow investors to withdraw their capital or reinvest it into the next phase.
This virtuous cycle increases project development velocity and possible project returns over
the long run.
Investment phase
Operational Phase
Financial development
SMART
ACCELERATOR
What is a SMART accelerator?
Smart acceleration of development combines accelerated project identification, development and operation with pre-qualified Edge Fund investment aligned with community interests. Long term investment in stable flows of ‘exergy’ (energy delivered - as opposed to energy produced) is combined with short term investment in rapid delivery of networked energy systems which are efficient, durable, yet adaptively 'future-proofed'..
S.M.A.R.T. describes project management which focuses on concepts and objectives with attainable and measurable goals and outcomes.
S.M.A.R.T. acceleration identifies 'hot spots' of high cost/high carbon energy use to achieve rapid quick win efficiencies through timely and effective combinations of technologies.
IslandPower then introduces innovative and transparent Edge Fund surplus sharing partnership investment to rapidly mobilise innate local community knowledge and skills to a common purpose of energy independence and resilience.
PHASES
There are two distinct financial development opportunities:
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Physical development
- identify projects suitable for Smart Acceleration.
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Financial development
- identify and refinance existing projects, or pools of
projects, to release development credit for future
projects.
Investment - two asset classes:
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Development Finance
Short term investment in transition of energy islands from
high cost/ high carbon to low cost/ low carbon Natural Grids.
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Operational Funding
Long term/low risk investment in stable flows of low carbon
energy or energy savings developed or refinanced by
IslandPower
Investment class
Development Phase
Financial development
Development investors may reinvest capital in new development or maintain some or all for the long term
Physical development
This revolving pool of development credit accelerates development programmes and long run returns for risk-friendly investors and 'venture philanthropist'
Investment phase
Operational Phase
Investment in operational practices and improvement to dynamic systems
Improved local skills & capacity increase resilience of operating partners and enhance local economy