Place image in this area. TK RENEWABLES WPT2 EIBHLIN MARSH & KIERAN MC LAUGHLIN Place image in this area.

TK RENEWABLES GENCOMM MEETING 27TH JUNE 2018 STORNAWAY

Objective: To develop a Financial/Commercial Decision-Making Model to be used to project, evaluate and optimise the financial performance of zero/low carbon/SMART community scale hydrogen systems across the North West Europe (NWE) region.

METHODOLOGY Initially use public data to create the model Develop on a common platform Validate using the data from the 3 Implementation work packages Develop a workplan for approval by Gencomm partners

PLAN FORMAT - Content and duration of project activities - Start up activities – early adopter group, demo data agreed etc. - Content and duration of project activities - Information collection tools - Data analysis process and rules - Additional market data activities - Development of data templates - Skills and abilities required to undertake the work - Development of input/output templates - Validation steps - Activities and Resources

DATA REQUIREMENTS INPUTS For each of the 3 implementation workpackages the following parameters will be defined The technical operating parameters and specifications The electricity costs for a range of sizes of plant Curtailment factors Equipment operational life Capital and operational costs for agreed size ranges Hydrogen Production Equipment Hydrogen Distribution Equipment Hydrogen market Values per region

DATA REQUIREMENTS OUTPUTS As examples the outputs from the model will likely include: Calculated cost of electricity by technology Calculated cost of hydrogen per kg Total System Capex Total System Opex Volume of hydrogen per day/per annum Assessment of viability to supply certain hydrogen markets Communication plan for engagement with potential users

VALIDATION Upfront discussions will be held with the 3 Gencomm demonstration sites to identify and request the required data to allow validation of the model Testing with the early adopter group and undertake any modifications to ensure the points made by the early adopter group are addressed

DEVELOPMENT There are a number of existing Financial Models in use today but many are quite complex and can be too cumbersome. MARKAL Model – MARKet Allocation simulates the market for energy technologies. TIMES model – The Integrated MARKAL-EFOM System which is a combination of models TIAM model – TIMES Integrated Assessment Model All are interesting but too global in scale for our project

DEVELOPMENT The required system needs to be able to make performance predictions and cost-of-energy estimates for all 3 technologies within this project namely wind, solar and AD which are based on installation and operating costs and system design parameters which have been specified as inputs to the model. .

DEVELOPMENT We will be designing and developing a bespoke model similar to the System Advisor Model (SAM) developed by the National Renewable Energy Laboratory based in the USA. Development will be using Visual Basic Excel software.

DEVELOPMENT The SAM model is a good example of what a comprehensive model should look when complete. The following screen shots are examples of the type of basic information the GENCOMM Financial will display when complete.

Graphs and Charts on the Results page displays graphs of results that you can easily export to your documents.

Graphs and Charts on the Results page displays graphs of results that you can easily export to your documents.

In this screenshot, you can see several rows of the cash flow table for a 10-megawatt utility-scale project with a two-partner flip financial structure.

TIMING These are the types of results which we intend to have available as part of our model outputs.

TIMING The validated model will be operational by March 2019.