Presentation Wind Energy 2016

”WOULD YOU RECOMMEND AN INVESTMENT IN THE GERMAN ONSHORE-WIND-ENERGY INDUSTRY?“

Speakers' Corner WindEnergy Hamburg, September 27, 2016, 11:45 - 11:55 hElin Lüdemann (RSM), Domenico Blyth (CVM)

RSM-CVM-WIND-ENERGY STUDY

Contents

1. Introduction: Presentation of the speakers and their companies

2. Presentation of the RSM-CVM-Wind-Energy Study

3. Concl.: ”Would you recommend an investment in the German onshore-wind-energy industry?“

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Dipl.-Kfm., M.Sc., Domenico Blyth is a Project Manager at CVM since 2009. Mr. Blyth graduated with a diploma in “European Business Studies“ at the University of Aachen. In addition, he studied at the University of Florence, Italy. He graduated with a masters degree at the University “Mid Sweden“ in Östersund, Sweden. From 2007 to 2009 Mr. Blyth worked in the plant engineering and construction business. His present work consists of the supervision of M&A-projects and of consultancy of insolvent clients of small and medium-sized enterprises (branches: renewable energies, machinery and plant engineering, metal working, trade, automotive and services). Contact details: [email protected], tel.: 0049-231-841747-0

Dipl.-Kffr., StB, WP, Elin Lüdemann is a working at RSM in Hamburg since 2014. After graduating with a diploma in business administration at the university of Hamburg in 2002 Mrs. Lüdemann worked as a manager in the audit department of EY until 2013. In 2008 she passed her exam as German tax advisor and in 2012 as German CPA. She is specialized in accounting related consulting and a member of the RSM working committee “(Green) Energy“. Contact details: [email protected], tel.: 0049-40-35006-215

mailto:[email protected]

mailto:[email protected]


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CVM Capital Value Management GmbH is an independent M&A consulting firm based in Dortmund. Their business focuses on accompanying and consulting mergers and acquisitions of medium-sized companies within the branches “industry“ and “trade“. In addition, CVM is specialized in insolvent companies and enterprises during their financial recovery phase. Since 2010 CVM successfully supported about 50 transactions. In 2016 new offices in Berlin and Hamburg have been established. They are led by Kai Peppmeier and his colleague Andreas Knaup.

RSM is the 10th largest accounting firm in Germany. The network contains more than 1,000 employees at more than 23 locations in Germany and it is one of the largest professional service firm focused on the middle market. Therefore, RSM Germany has a deep understanding of unique needs of middle-market companies. RSM Germany provides dedicated resources and nationwide capabilities. As a member of RSM International – the 6th largest network of independent accounting, tax and consulting firms – RSM in Germany cooperates with a global network of experts.

Contents


2. Presentation of the RSM-CVM-Energy Study


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Structure of the study

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A. IntroductionI. Status Quo – the German wind industry as of todayII. Structure und approach of the study

B. Market development – global, European and German wind-energy marketC. Chances and risks of the German wind-energy industry

I. Political factorsII. Economical factorsIII. Social and environmental factorsIV. Technical factors

D. Results of the research of RSM and CVME. ConclusionPersons in charge

C. I. Political factors: EEG 2017 core statements

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• Name of the law has finally been changed to Renewable Energy Source Act 2017 (known as ”EEG 2017”), bill passed by German Bundesrat July 8, 2016

• In future, there will be tenders to promote the wind-energy on- and offshore, certain photovoltaic and biomass plants

• There should be three tenders (in 2017 and from 2020 et seqq.) respectively four (in 2018 and 2019)

• Volume of tenders plant 2,800 MW (gross) for onshore-wind-energy-plants per year from 2017 to 2019 and 2,900 MW (gross) from 2020 et seqq., the law includes exceptions

• Concerning the reward system in accordance with EEG 2017: the so called „Zuschlagswert“ at the location referred to is relevant in accordance with exhibit 2 para 4 EEG 2017 (so called „einstufiges Referenzertragsmodell“)

Please note the speech of our RSM colleagues, Jan Königshoven and Armin Kroniger, “EEG 2017 – the brave new world of the promotion of renewable energies!?”, September 28, 2016, 14:45 – 14:55 h



D. Selected take aways of the study (1/8)

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We have polled:

14%

29%

14%

32%

11% Wind Power Plant Manufac-turers

Planners of Wind Power Plants

Wind Power Plant Operators

Potential Investors, i.e. banks

Other Participants



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39% of the interviewed companies foresee a positive trend within the next one to five years (the polling of the participants took place until March 2016). By contrast 57% expect a stagnation or even a downturn in business within the mentioned period of time.

Expansion Stagnation Recession not specified0%

10%

20%

30%

40%

50%

39%

25%

32%

4%



10

More than half of the participants (54%) deem it is economically reasonable to extend their own spectrum of services and add an own technical operation management.

54%

14%

32%

YesNonot specified



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Generally speaking, 89% of the polled companies evaluate all four income drivers as „1= very significant “ to „3= neutral“ within the calculation of existing wind-energy plants and wind-energy plants being constructed.

Wind Power Plant-efficiency factor

Technical availability

Feed-in compensation

Wind quality

0 5 10 15 20 25 30

9

12

12

17

10

7

8

7

6

6

5

1

3

3

3

3

1 2 3 4 5 not specified



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When talking about the main cost drivers of existing wind power plants the polled companies assess the costs of acquisition (54%) and leasing (36%) as “very significant“. The costs of maintenance (53%), financing (46%) and repair (46%) have been evaluated as “significant “.

Taxes

Insurance costs

Depreciation

Repair costs

Maintenance

Leasing costs

Financing costs

Acquisition costs

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

4%

7%

14%

18%

29%

36%

25%

54%

14%

7%

18%

46%

53%

29%

46%

25%

39%

43%

18%

11%

4%

11%

11%

6%

14%

14%

25%

7%

4%

7%

4%

7%

11%

4%

21%

18%

21%

18%

14%

20%

11%

11%


Operational costs



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Evaluating the cost drivers of wind-power plants being constructed the polled companies rate the costs of investment (54%), planning (39%) and leasing (39%) as “very significant”.

Costs for Surveyors

Costs concerning Federal Immission Control Act

Development costs

Planning costs

Leasing costs

Investment costs

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

7%

11%

18%

39%

39%

54%

15%

25%

29%

25%

29%

29%

50%

29%

25%

25%

18%

4%

7%

11%

11%

7%

7%

14%

17%

17%

11%

14%

13%




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Compared to the current level of interest in Germany p.a. 6% as an internal rate of return in an investment in the German onshore-wind-energy market will be highly financially rewarding.

4 to 6% greater than 6% not specified0%

10%

20%

30%

40%

50%

21%

47%

32%

Contents




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3. Concl.: ”Would you recommend an investment in the German onshore wind-energy industry?“


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In summary the polled companies conclude that the political factors respectively the political circumstances in Germany are the toughest challenges they will face in the near future.

Technical factors

Social and environmental factors

Economical factors

Political factors

0 5 10 15 20 25 30

9

13

18

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Many thanks!Please feel free to ask your questions now!

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Presentation Wind Energy 2016

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Transcript of Presentation Wind Energy 2016