INTERNATIONAL EXPERIENCE

The technical due diligence review for the financing included the analysis of the plants’ output, the technical evaluation of the projects, including the main equipment, civil engineering and electrical system, as well as the evaluation of the technical aspects of the main contracts of the project (EPC, O&M and PPA) and of the economic model of the financing.

The technical due diligence review for the financing included the analysis of the plants’ output, the technical evaluation of the projects, including the main equipment, civil engineering and electrical system, a visit to the facilities to ascertain their state and an opinion on their useful life. The O&M arrangements and associated O&M contracts were also analyzed, as well as compliance with permits and licenses, environmental compliance and the financial model of the transaction.

The technical due diligence review for the financing included the analysis of the plant’s output, the technical evaluation of the project, including the main equipment, civil engineering and electrical system, as well as the evaluation of the technical aspects of the main contracts of the project (EPC, O&M and PPA) and of the economic model of the financing. The environmental and social due diligence review included the evaluation of the environmental and social aspects of the project per the Equator Principles and the review of the Environmental and Social Action plan, all in accordance with the Inter-American Investment Corporation (IIC) Environmental and Social Sustainability Policy.

The financed public works (OPF) project consisted of the remodeling for the Federal Electricity Commission (CFE) of 4 transmission lines and 10 electrical substations mainly situated in Mexico City. The turnkey contractor received financing for the construction of the project.

Our work entailed the analysis of the technical and economic situation of the project for the banks providing the financing.

Technical due diligence review for the issue of PV project bonds without recourse for a total amount of €404 million, analysis of the plants’ output, technical evaluation of the projects, visit to the facilities to evaluate the state thereof, analysis of useful life and incidents occurred. We also evaluated the O&M arrangements and technical aspects of the O&M contracts, the environmental permits and the financial model of the transaction.

The project consisted of a 50 MW forest biomass plant situated in Curtis, Galicia.

Our technical advice on the project included the drawing up of the technical and contractual specifications for the engagement of the builder of the plant under an EPC arrangement, the evaluation of the biomass resource, contractual negotiations with bidders and the technical due diligence review for the financing of the project. We advised the client throughout the project on the technical risks of the project with a view to future financing.

The project consisted of two 15 MW forest biomass plants situated in Fundao and Viseu (Portugal).

The technical due diligence review for the financing included the evaluation of the biomass resource, the analysis of the plants’ output, the technical evaluation of the project, including the main equipment, civil engineering and electrical system, as well as the evaluation of the technical aspects of the main contracts of the project (EPC, O&M and PPA) and of the financial model of the financing.

The technical due diligence review for the financing involved the technical evaluation of the project, including the main equipment, civil engineering and electrical system, and the evaluation of the technical aspects of the main contracts of the project (EPC, O&M and PPA) and of the economic model of the financing.

Our work included the forecast of future electricity prices (pool prices) using a fundamental model. Among others, the model uses as a hypothesis the installed capacity by type of technology, commodity prices, international exchanges, etc. The peak coefficient of the Valiente wind farm was also estimated by matching it in the market, taking into account its hourly load curve and variable costs.

In preparing the expert report, we evaluated the income of a cogeneration plant under the different regulatory frameworks (RD 661/2007 and RD 413/2014) taking into account the initial operation of the plant, analyzed the operating measures to be adopted in light of the remuneration system regulated in RD 413/2014, and calculated the profits obtained by applying these operating measures.

Preparation of a financial model to simulate the specific remuneration to which the wind farms that took part in the May 2017 auction will be subject, with different levels of discount when certain regulatory parameters vary, such as market price or reasonable return, in order to obtain the IRR for the project and for shareholders.

• Assistance with monitoring, verification of emissions and surrender of emissions allowances according to legislative requirements.
• Analysis of the ability to use carbon credits (EUAs, CERs, other fungible credits in emissions trading systems linked to the European system) to fulfil the obligations to surrender allowances.
• Free allocation of European emissions allowances for the period 2013-2020: independent calculation of the expected allocation according to the established legislation. Preparation of an Excel template and explanatory memo on the assumptions used.
• Modification of greenhouse gas emissions permits in line with modifications to the plants.
• Recurring advice on the management of obligations under international legislation and domestic implementing provisions.
• Advice on matters relating to the Union Registry.
• Advice on emissions allowance trading based on standard models (ISDA, IETA; CMOF, EFET, others).
• Advice on trading on stock exchanges or organized platforms (Exchange) and on periodic auctions of emission allowances.

The project consisted of a 110 MW CSP plant using power tower technology situated in Tonopah (USA). Our technical advice included monthly supervision of the construction of the facility, including visits to the plant and supervision of its operation during the first year of service.

The project consisted of the replacement of conventional public street lighting systems with LED technology in a large town, including the modernization of electrical circuits and control systems. Our technical due diligence review for the financing included the analysis of the lighting project, the LED technology to be installed, the potential savings of the project and all contractual, environmental, social and economic aspects of the project.

• Initial design of the Sector Mitigation Mechanism (MSM), taking into account the technologies to be incentivized and emissions reduction potential.
• Search for potential cogeneration projects participating in the MSM as mitigation activities and selection of the projects that best fit the established eligibility criteria.
• Economic and technical analysis of the viability of the MSM with the selected mitigation activities, estimating the potential reduction and incentives assigned.
• Final design of the MSM with the incentive mechanism and preparation of an implementation plan.

Aim: Performance of an Environmental Risk Analysis, in accordance with the provisions of the Environmental Liability Law and its partial implementing regulations, of the project to reopen an open-cast iron mine, to be submitted to the competent public authority.

The main tasks included:

• Evaluation of the project to reopen the mine through review of the documentation and a visit to the mine.
• Preliminary identification of the hazards and initiating events associated with the reopening of the mine.
• Determination of the Basic Environmental Status of the area.
• HAZID and HAZOP meetings to confirm the hazards and initiating events (IE) identified and select the most representative ones.
• Working meetings to determine the likelihood of the risk scenarios occurring.
• Determination of accident scenarios and conditioning factors.
• Estimation of the amount of the required financial guarantee.

Aim: performance of a detailed technical audit of 65 facilities of different types (landfills, mechanical/biological treatment plants, composting facilities, CDW treatment plants, anaerobic biodigestion, biogas recovery and electricity generation plants, etc.) for the management of solid urban waste throughout Portugal.

The main tasks included:

• Technical due diligence review of the facilities and operating data provided.
• Identification of deficiencies, breaches and malpractice in the management of the facilities.
• Establishment of areas for improvement and recommendations.

• Review of the main carbon footprints of organizations similar to that of the client in order to select the best practices available.
• Analysis of the European environmental footprint process and possible related considerations such as the organization footprint.
• Review of data by analyzing all relevant parameters as well as a representative sample of the primary and secondary sources.Preparation of an Excel workbook for obtainment of the carbon footprint in accordance with the WBCSD GHG Protocol standards, both for calculation structuring and associated technical guides. Application of the guidelines and spirit of ISO 14064 for the potential certification of the organization under the two standards.
• Obtainment of an emissions factor with sufficient traceability that can be updated on an annual basis and verified by a third party.

Aim: to design and implement a General Regulatory Compliance System at AENA, review the functioning of the Corporate Compliance Model, provide the entire organization with the necessary training and raise awareness, all with the participation of a multidisciplinary team with extensive experience in this area made up of professionals from the Garrigues Group.

The main tasks included:

• Review of the general regulatory framework, corporate policies and code of conduct of Aena’s corporate governance system and preparation of the necessary documents.
• Analysis of the regulatory compliance risks and existing controls associated with them.
• Additional necessary controls, supervision and reporting.
• Training and communication of the System.

Aim: Integral management, with all parties involved (public authorities, third parties, operator, subcontractors, etc.), of a procedure concerning groundwater affected by historical metal contamination.

The main tasks included:

• Detailed technical study of the problem.
• Representation of and spokesperson for the company vis-á-vis the different parties affected/involved.
• Organization of meetings with the public authorities to take care of the administrative matters involved in managing the project and create a trusted communication framework between the parties.
• Identification and selection of the company tasked with designing and executing the environmental recovery and landscape restoration project.
• Supervision of all tasks and work to be performed.

Aim: review of the environmental and social risks of energy projects in accordance with the IFC Performance Standards and the Equator Principles.

The main tasks included:

• Review of the environmental and social aspects of the projects prior to the financial close of the transaction.
• Preparation of a table identifying and providing a quantitative assessment of risks.
• Supervision of compliance with the Environmental and Social Monitoring Plans during the construction and subsequent operation of the plants.

Aim: preparation of expert reports on technical and economic disputes with the public contracting bodies in relation to public service concessions for integrated water cycle and waste management.

The main tasks included:

• Gathering and review of documentation.
• Meetings with legal counsel to ascertain the litigation strategy.
• Preparation of expert report.
• Defense of the report in court.

Aim: corporate management in the area of corporate responsibility and compliance management, from a risk management approach.

The main tasks, performed in conjunction with a multidisciplinary team from Garrigues, included:

• Assessment of the institutional situation and corporate management of material aspects.
• Due diligence review of relevant areas from a legal standpoint.
• Risk map
• Preparation of Master Plan.

CORE (Control del Riesgo Empresarial -corporate risk monitoring)- is a software tool for risk and compliance management that simplifies and reduces the work needed, both during the design of the management system and in the later stages of its life cycle.

CORE helps:

1. Integrate the management of all types of risks and monitoring procedures (legal, environmental, operational, regarding the supply chain, etc.) in a single platform.
2. Identify the persons responsible for each type of risk, monitoring, country, location, business unit, etc.
3. Provide guidance in the risk identification and analysis process and standardize assessment methods through the use of specific questionnaires tailored to each type of risk.
4. Monitor the actions established in the management system, assigning a status, person responsible and timescale for each of them, with the possibility of creating delegated actions and personalized alerts.
5. Simplify document access and management for the documents generated in the system, by associating the policies and procedures, and the templates or records arising in connection with them, with the risks, monitoring procedures and actions.
6. Simplify communications through automatic notification of the assignment of responsibilities or proximity of deadlines, as well as management of manual email distribution lists.
7. Prepare reports from predesigned internal reporting templates and export information to Excel spreadsheets in a structured way, for the preparation of specific reports (statistics, indicators, etc.).

Aim: to prevent the commission of criminal offenses at organizations and improve their defense options by complying with the conditions or requirements for exemption or reduction of the Company’s criminal liability in criminal proceedings, all of the above with a multidisciplinary team of expert criminal lawyers from Garrigues and consultants from G-advisory.

The main tasks included:

• Knowledge of the organization and preparation of a preliminary risk map.
• Training on criminal matters and preparation of the definitive risk map.
• Installation of and training on the compliance management tool (CORE).
• Preparation of the management system and its constituent documents.
• Support for the implementation of the criminal risk management systems.

Aim: to prevent the commission of criminal offenses at organizations and improve their defense options by complying with the conditions or requirements for exemption or reduction of the Company’s criminal liability in criminal proceedings, all of the above with a multidisciplinary team of expert criminal lawyers from Garrigues and consultants from G-advisory.

The main tasks included:

• Knowledge of the organization and preparation of a preliminary risk map.
• Training on criminal matters and preparation of the definitive risk map.
• Installation of and training on the compliance management tool (CORE).
• Preparation of the management system and its constituent documents.
• Support for the implementation of the criminal risk management systems.

Aim: to reinforce ESG aspects in the management of the Group’s suppliers to ensure they are considered a risk factor, at the same level as other risk factors (operating, quality, health and occupational risk prevention, and legal risks).

The main tasks included:

• Definition of an ESG risk methodology specific to GNF.
• Preparation of an ESG risk map, by supplier subtype.
• Development of specific questionnaires to analyze ESG risks.
• Review of GNF’s codes and policies in order to integrate environmental, social and governance aspects with respect to its suppliers.

Aim: technical and business advice to the consortium of companies led by AGBAR for the presentation of a bid in the largest tender process for management of the integrated water cycle to date in Spain.

The main tasks included:

• Technical due diligence review of the facilities and operating data provided.
• Appraisal of amounts and needs in connection with the required investments.
• Preparation of water demand projections.
• Validation of the hypotheses of the economic and financial model prepared for the bid.

• Definition of the CDM project, specifying the scope of same.
• Analysis of the viability of the project as a CDM. Detailed analysis in order to determine whether the project is eligible according to the criteria established by the CDM Executive Board.
• Analysis of the Certified Emissions Reductions (CERs) obtainable by the project.
• Review of data relating to calculation of the baseline.
• Design of the project as a CDM: preparation of the Project Design Document. Selection of the most suitable baseline and monitoring methodology. Review of environmental aspects.
• Presentation of the project to the designated national authority (DNA) for obtainment of letters of no-objection and approval.
• Technical assistance for validation and registration. Assistance to the client for validation of the project by an designated operational entity (DOE) and registration of the project as a CDM.

• Gathering of information. Identification of the sectors to be studied and data sources.
• Evaluation of technologies and systems. Identification of the main mitigation technologies for each sector.
• Preparation of a support tool to quantify mitigation potential.
• Characterization and evaluation of mitigation costs and potential for the evaluated technologies.
• Preparation of database, scenarios, development of simulations, analysis and preparation of conclusions.

The report included a full description of the Spanish electricity market and its different activities: generation, transmission, distribution and trading. It also explained the operation of the wholesale electricity market. The report also contained an estimate of the future income and costs of the electricity system with a view to evaluating the potential existence of a tariff deficit in the future, analyzing the different factors that could lead to deviation from the projected estimates.

• Gathering and analysis of data on economic sectors in the regions of St. Petersburg and Leningrad.
• Analysis of the expected climate change impact.
• Identification of mitigation options in the region.
• Identification of adaptation options in the region.
• Design of the regional climate change strategy: principles and general considerations.