Victoria CFA Society October 9, 2007
Forward Looking Statement This presentation may contain "forward-looking statements" within the meaning of Canadian securities legislation and the United States Private Securities Litigation Reform Act of 1995 . These forward-looking statements are made as of the date of this presentation and the Company does not intend, and does not assume any obligation, to update these forward-looking statements. Forward-looking statements relate to future events or the anticipated performance of the Company and reflect management’s expectations or beliefs regarding such future events and anticipated performance. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved", or the negative of these words or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual performance of the Company to be materially different from any anticipated performance expressed or implied by the forward-looking statements. Such factors include various risks related to the Company’s operations, which are detailed from time to time in the Company’s interim and annual financial statements and management’s discussion and analysis of those statements, all of which are filed and available for review on SEDAR at www. sedar.com. Although the Company has attempted to identify important factors that could cause actual performance to differ materially from that described in forward-looking statements, there may be other factors that cause its performance not to be as anticipated. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. 2
Vision Mission Statement Vision Mission Statement Plutonic Power Corporation is Plutonic Power identifies and focused on becoming the pre- develops environmentally friendly eminent supplier of ‘green and economically viable non- electricity’ in British Columbia storage run of river power projects that will benefit all stakeholder groups and maximize shareholder value. 3
Management and Board of Directors Management Team Board of Directors Management Team Board of Directors • Walter Segsworth, Chairman • Donald McInnes, President & CEO • R. Stuart (Tookie) Angus • Grig Cook, Chief Operating Officer • Bruce Ripley, Exec. VP. Operations • Dr. Peter Flynn • Paul Sweeney, Exec. VP. Business Dev • Michael Volker • Robert Poore, Dir Corp. Affairs • Dr. William Lindqvist • Marc Stachiw, Dir Corp. Development • Peter Wong, CFO • Donald McInnes • Bill Irwin, Dir. Lands Resource Mgmt. • Grig Cook • Elisha Moreno, Dir. Communications • Tom Syer, Dir. Policy and Regulatory 4
Capital Structure • Stock Symbol: PCC:TSX • Capital Structure – 39.5 million shares <basic> – 47 million shares <fully diluted> • Ownership: Insiders : ~11% Institutional: ~60% • Current Price (Oct 3, 2007): ~ $8.25 • Cash: ~ $10 million / no debt* • Market Cap: ~ $325 million, FD $385 million • 52 week high / low: $9.75 – $1.80 * Does not include $38 million payback upon East Toba/Montrose financial close 5
Why Green Power in BC • BC Energy Plan for 2007 – Target reducing BC GHG emissions 33% by 2020 – All electricity generation: zero net emissions by 2016 – $25 million Clean Energy Fund (RoR included) – Provincial self-sufficiency by 2016 (20,000 Gw.h) – 90% of BC Energy from clean renewable resources • BC imports electricity – 7,400 GWh out of total electricity consumption of 55,000 GW.h – 1 in 8 homes powered by imported electricity • Environmental concerns addressed • National green power programs underway 6
BC’s Climate Change Initiative Challenge 2007 Speech from the Throne, the BC government announced its intention to reduce greenhouse gas emissions in the province to 33% below current levels by 2020. A cumulative total of 20 megatonnes of CO 2 . Solution • BC Energy Plan to become self sufficient on clean energy. • Negates ~7500 GW.h per annum of nonrenewables • BC Clean offsets = 8.25 Megatonnes or 41% of target • Equivalent to removal of 1.6 million cars from the road 7
No major capacity built in over 20 years 3500 5 Hydropower 3000 Thermal 2 2 IPPs Operating IPPs Contracted 2500 Mega-Watts 2000 F2006 CFT 38 1500 NO MAJOR ADDITIONS SINCE 1984 # of projects 1 1000 2 11 14 500 1 2 21 4 2 12 1 0 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 8
BC Hydro Calls for Power # EPAs # operating Awarded Operating projects Awarded GWh GWh 2006 Open 38 0 7125 0 2004 VICFT 1 but terminated 0 2000 0 2003 Green 14 1 1535 15 2002 CBG 2 1 223 140 2001 25 20 1032 951 1994 RFP/NI 3 1949 1989 RFP 14 427 1988 RFP 3 1536 Pre-1988 2 84 Total 45 5100 9
Clean Power Call 2007 • Acquisition target of 5000 GWh/a • Clean and renewable resources • Over 10 MW • Longer in-service dates (until 2016?) • Power Call also expected in 2009 Draft 2007 Clean Power Call Schedule Draft Terms Fall 2007 Application for filed with BCUC Late 2007 Issuance of Call Spring 2008 10
11 IPPs in BC
Current Operating IPPs in BC # GWh MW total GWh MW total average average Hydro 35 1600 360 35 10 Biomass 4 750 96 188 24 Biogas 3 60 9 20 3 Gas 2 2640 345 1320 173 TOTAL 45 5100 810 115 18 12
Long term export opportunities • BC Hydro primary existing customer • Longer term export opportunities • BC Hydro/Powerex have been exporting power for years • Renewable Portfolio Standards driving California to look at BC renewable energy • Current transmission constraints to sell into U.S. 13
CAUSE and EFFECT Is it a case of the Cure being as dangerous as the Disease?
15 Supply / Demand Gap
16 Imports vs. Exports
17 What is Run of River
18 Intake Example
19 Powerhouse Example
Run of River Benefits • Non-depleting resource • Small environmental footprint • No dams or reservoirs • No change to rivers downstream • Considered ‘green energy’ • Long life facilities – 50 years + • Low operating costs – under 20% of revenue • No fuel price risk • No technology risk – 35 established run of river projects in B.C. 20
Environmental Impact Comparison Total Im pact (W eighted) Oil Coal Gasification (Without CO2 removal) Gasification (90% CO2 removal) Natural gas (Single Cycle) Natural gas (Co-generation) Natural gas (Combined Cycle) Nuclear Biomass Photovoltaic Wind Hydro Storage Run of River 0 50 100 150 200 250 300 Source: Ontario Report: OPA and SENES Relative Impact 21
Plutonic Project Site Benefits • Large ‘utility grade’ locations • Remote sites (avoiding NIMBY problems) • Existing road infrastructure • Non-salmon bearing streams – Ease of environmental permitting • High head projects (vertical drop) • High rainfall areas (fuel source) • Glacial run-off (steady flows) 22
23 Topography and Rainfall Areas
24 34 Development Locations
East Toba River Intake Site Buried Penstock Intake Site Inflatable Weir Head pond Flow East Toba River 25
East Toba River Powerhouse Site 4.8 km Buried Penstock Corridor (3m dia.) 565 metres vertical head Powerhouse East Toba Project –Conceptual Rendition of Powerhouse Confluence with Toba River 26
East Toba / Montrose Project • 196 MW: ~ 745 GWh (75,000 homes) • Permitting completed Q2 2007 • Construction Underway • Construction period: 3.5 years • General Contractor: Peter Kiewit Sons Co. – Large experienced contractor in hydropower – EPC contract signed Sept. 20, 2007 – Date, cost, performance guarantees • Proposed COD early 2010 Toba, late 2010 Montrose 27
East Toba/Montrose Economics • Capital Costs: – $500 million fixed EPC price – $160 million in interest, closing costs, insurance, etc. • EPA Contract Term: 35 years • First year Annual revenue: ~ $67 million* – Escalated at 50% CPI for term of contract • Annual expenses (O&M and taxes): ~ $13 million • EBITDA: ~ $54 million • Equity Cash Flow: ~ $20 million * Does not include $10/MWh for 10 years EcoEnergy incentive (Potential additional $7.5 million to cash flow for 10 years) 28
Plutonic/GE Deal • GE to invest $100 million in equity • GE/Manulife to finance $470 million in project debt • $90 million in other guarantees and letters of credit • Plutonic retains 40% carried economic interest • Plutonic will be 51% legal project owner • Economic interest will revert to 51% Plutonic and 49% GE after 35 years 29
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