1. Africa Talks Lucas Hautvast, CEO & President
ENGIE - South Asia, Middle & East Africa
10 June 2015
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2. ENGIE – Global Energy Leader
Three core businesses: Power – Gas – Energy Services
Serving governments, cities, industries & businesses
Expertise in four key sectors: independent power production, renewable energy, natural gas, energy services

3. Electricity to Governments Utilities to industries
ENGIE has 73.9 GW gross capacity in operation and 10.1 GW gross capacity of IPP projects under construction outside of Europe (31 Dec 2014)
IPP business models
Electricity to Governments
Utilities to industries
Power to the Public
ENGIE is the leading IPP in the Gulf countries:
27.5 GW gross (gas-fired) capacity awarded since 1996 (i.e. 60% of all MW capacities in the Gulf)
Long-term Power Purchase Agreements with state-owned utilities
Success factors: competitive tariffs, strong partnerships, innovative technical and financial structuring
One of the major private power producers in Thailand
Generation and supply of electricity, steam, demineralized water and energy services to large industrial customers located in Map Ta Phut industrial & petro-chemical complex
Largest IPP in Brazil, representing ca. 7% of the country’s total installed power generation capacity
Tractebel Energia is publicly-listed with public pension funds, central bank as key shareholders
Gulf Countries
UAE, Saudi Arabia, Qatar, Kuwait, Bahrain, Oman
27,500 MW in operation & under construction
Glow Group
Thailand
3,200 MW
Tractebel Energia Brazil – ca.13,000 MW
in operation & under construction

4. Investment climate & attractiveness
What are private investors looking for?
Transparency in the process
Institutional strength
Certainty & stability of policies and regulations
Clear and consistent policies
Effective administration, reducing barriers to business entry & expansion
Investors in the energy sector are in a country for the long-term, we are tied to physical assets, we cannot and will not walk away from assets; so certainty and stability is essential for us to make investment decisions
Energy is a complex business, if the goals for adding capacity are there, but no process for acquiring land or getting an environmental permit, then we know we are looking at long delays or projects that will never get built;
We need to know what a Government’s priorities are, is it adding MWs, is it a renewable goal, is it increasing access to the citizens, do you intend to tender as EPC or welcome IPPs etc.
Once priorities are clarified, we as investors can and will go about making it happen

5. Cost-competitiveness of renewable power has reached historic levels
Levelised cost of electricity (LCOE) of solar PV has halved between and 2014
The most competitive utility-scale solar PV projects are now at USD 0.08 per kWh without subsidies, compared to a range of USD to USD 0.14/kWh for fossil fuel power
The recent tender in Dubai resulted in a successful bid for a solar PV PPA for under USD 0.06/kWh
Onshore wind is now a very competitive source of electricity available; the recent bid in Egypt drawing the lowest bid under 4 UScents / Kwh
I’m happy to be associated with one of the two projects, I’ll leave you to find out which one…

6. Africa: rich in resources … but with immediate & growing needs
I mentioned Egypt and that draws me to Africa…blessed with natural resources to provide incredible amounts of power to the continent
Source: IEA 2014

7. Where will Africa’s energy come from ? Renewables, yes …
Renewables from 22% to 44% of installed capacity:
50% of total growth in capacity
66% of growth for mini-grid and off-grid in rural areas
Given their cost competitiveness, renewables WILL play an increasing role in Africa
Source: IEA 2014

8. But also natural
gas
Safe and clean; can be stored, so perfect buffer when used alongside intermittent renewables
Flexible dispatch in power generation: short start-up, shut-down times
Competitive base-load option for countries with gas reserves
Technically recoverable reserves of natural gas in Africa are estimated to be about 75 tcm, almost 10% of the world’s total
While major recent discoveries have been in and off Mozambique and Tanzania, Algeria, Egypt, Nigeria are expected to continue to tap into their gas reserves to serve
Governments are keen to target gas for domestic use, for example in Nigeria, which has a domestic gas supply obligation
Substantial shale gas resources in RSA
But as we all know, there are limitations to renewables and we see natural gas as a bridge from the heavy dependence on fossil fuels in the world today to an increasingly carbon free world…

9. Africa going forward … IPP should be part of the solution
Renewables (and gas) should be part of the solution

10. West Coast 1 wind farm (RSA) Commercial Operation on 9 June 2015
Thank you !
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