Advancing Renewable Energy

The UK’s Renewable Industry Accelerator

Advancing Renewable Energy

The Birth of a Global Industrial Economic Opportunity Since privatisation in the 1980’s, our competitive market and system of independent

regulation has delivered reliable, affordable electricity. It is crucial for the UK’s

international competitiveness and economic development that this continues, however,

we face a number of unprecedented challenges in the coming decades:

Security of supply is threatened:

Over the next 10 years we will lose around a quarter (20GW) of

our existing generation capacity as our old, more polluting plants

close. With likely demand set to double over the same period

our electricity demand will exceed generation capability and we

will face an increasing likelihood of blackouts.

Decarbonisation is essential:

The UK must start its transformation to a low carbon economy

immediately if we are to meet our 15% renewable energy target

by 2020 and 80% by 2050. To put us on the latter trajectory,

power sector emissions need to be largely decarbonised by

2030.

The Government Renewable Energy Roadmap:

The challenges of decarbonisation and security of supply will

need to be met through a combination of measures. The

Government have listed *8 technologies that will be developed

to produce 90% of the renewable energy we need for 2020.

Innovate to reduce cost and accelerate deployment:

A rapid scale up in technology innovation is required to levelise

the cost of producing renewable electricity and accelerate

deployment to meet our obligations. However market failure,

technology reliability and performance certainty has led to risk

aversion amongst investors.

Transition Requires Innovation Needs De-Risking To Gain Investment

*Technologies include – onshore wind, offshore wind, marine energy, biomass (electricity & heat), ground

& air source heat pumps, renewable transport

Images provided courtesy of Ocean Harvesting Ltd

Advancing Renewable Energy

Narec Group Provides a Seamless Industry Solution Our mission is to reduce financial risk and provide capital in order to accelerate the

deployment timeframe of renewable technology and reduce the cost per megawatt hour

Technologies

are selected

for testing

Narec provides

‘highly

accelerated

Lifetime testing’

and specialised

development

Narec’s

processes

evolve &

underpin

industry

certification

standards

Narec Capital

provides a

range of

specialist risk

mitigation

solutions

Narec Capital

introduces early

stage capital to

support

promising

technologies

and projects

Robust, cost

effective

technologies

are rapidly

launched into

project status

Understanding Risk & Knowledge Transfer

*

* Narec Capital is a joint venture between Ashberg Ltd (a fully regulated FSA company) and Narec

Images provided courtesy of Narec

Images provided courtesy of Narec

Advancing Renewable Energy

Narec World Leading FacilitiesTesting, Development & Validation

• Narec is recognised in the renewable energy industry

as one of the lead centres of excellence worldwide for

offshore wind technology development.

• Narec major clients in Europe, Asia Pacific and the UK.

• Narec has R&D collaborations in more than 10

countries.

• In 2010, Narec was

appointed Technology

Advisor to The Crown

Estate in relation to

the Offshore Wind

Round 3 programme.

• By end of 2012,

Narec will have the

largest onshore

physical asset base in

the world constructed

at a cost of more than

£130m.

Narec 3MW Capacity Turbine Drive Train Test Facility

Narec 100m Blade Test Facility

Narec 100m Blade Test Facility

Initiate Cost Benefit

Blyth Offshore

Demonstrator

Full

project

100MW -

£300M+

£18M+

develop

ment

phase

• Strategic enabler for Round 3

• Allows manufacturers to de-risk through

demonstration

• Compliments onshore assets to ensure

technology works

• Income from lease of sites & services

• Create data set to support insurance

wrappers

Project Fujin

15MW Drive train

test rig

£45M +

• Strategic enabler for Round 3

• Allows manufacturers to de-risk through test

& demonstration

• Part of strategic set of test rigs

Project Nautilus

3MW Drive train

test rig

£16M

• Strategic enabler for wave & tidal

deployment

• Allows manufacturers to de-risk through test

& demonstration

• Part of strategic set of test rigs

Blade Test II £18.5M

• Strategic enabler for Round 3

• Allows manufacturers to de-risk through test

& demonstration

• Part of strategic set of test rigs

Infrastructure £7.5M • Enabler for all of the above projects

Advancing Renewable Energy

Narec Capital Business Proposition & Key Future Partners

De-risking Renewable Projects and Technologies to Increase Capital Flow

Specialist

Consultancy

• Technical DD

• Project

Management

Oversight

• Strategy

• Simulation

• Knowledge

Transfer

• Training and

Search

Financial Risk

Mitigation

• Risk analysis

• Extended

Warranty

• Broking

• Specialist

underwriting

• Smart Asset

Management

• Forensic Audit

Capital Markets

• Capital Raising

• Debt and Equity

Structuring

• M&A

• Due Diligence

• Listing

• Refinancing

• Operational

Restructuring

Incubation &

Commercialisation

• Technology

Validation

• Incubation

• Commercial

Strategy

• Grant Application

• Management

• Discretionary

Portfolio

De-risking Capital Flow

Advancing Renewable Energy

Commercialisation Strategy and Market

Entry

• Commercialisation workshops to develop

first class technical propositions into

market leading commercial propositions

• Market insight and positioning proposals

• Matchmaking service to create partnerships

and collaborations

Project Development Oversight

• Professional project management oversight

on all aspects of renewable energy project

development

• Advice on key milestones in order to

enhance consortium profile and capital

raising

Technical Due Diligence

• Provide bespoke due

diligence for renewable

energy projects and

technologies for all key

project stakeholders

• Leverage Narec’s 120

specialist engineers to

work with insurers,

investors and industry

participants

Business and Supply Chain Modelling

• Develop cutting edge business models to

exploit rapid growth opportunities

• A powerful modelling capability using 3D

visualisation to solve and communicate

complex logistics, supply chain and

deployment decisions

Resources and Recruitment

• Develop bespoke specific client training

packages with accredited training partners

• Provide expert search and selection so that

skilled resource can be rapidly identified

and deployed

Narec Capital provides an end to end suite of consultancy services to mitigate risks and raise capital across the full range of renewable energy

markets and associated supply chains, including: wind; wave; tidal; solar; and bio products. These services are also offered to enabling fields such

as distributed energy; energy efficiency, energy storage and low carbon vehicles utilising collaborations with the national technology assets at

Narec and other Centres of Renewable Excellence.

Bespoke consultancy services can be applied by Clients at key project milestones between market entry and financial close. Narec Capital values

long-term Client relationships, where the application of our risk mitigation, capital raising and incubation services lead to shared interest in building

sustainable value. Ad hoc technical due diligence can be facilitated to support third party fund raising, post event loss adjusting claims and investor

assurance.

Specialist ConsultancyKnowledge & Market Insight

Advancing Renewable Energy

Test

Assets &

Clients

CorporatesKey

Projects

Financial Risk

Mitigation

Data

Co

‘Smart’

Asset

Management

Products

Wind WarrantySpecialist Underwriting MGA

(2013)

Services

Financial Risk MitigationRisk as a Function of Asset Base Utilisation

L

Partnership

• Co-broking

• Facility Broking

• Joint Product Development

Forensic

Audit

Narec Capital Risk

SolutionsBroking

(2011)

Partnership services and

product development

In conjunction with an array of partner insurers

Advancing Renewable Energy

Capital MarketsIncubated Companies & Large Scale Financing Initiatives

Narec Solar

• Up to £5m investment

• Narec spinout

• Niche product

• Fully commercialised with

established client base

Narec Capital uses its relationship with its parent company Ashberg Ltd (a fully regulated financial services company), to conduct corporate

finance activity. With its centre of operations in London, Narec Capital has access to a range of investors from business angels to banks and

pension funds. Our staff have over 130 years of capital markets experience with a strong track record of execution. Ashberg also provides a link

to emerging markets with senior advisors based in both Africa and India.

Jack Up Vessels

• £350m investment

• Guaranteed contracts

• Premier offshore operators

Bio Fuel

• Large UK Biorefinery

• £60m - £350m

• Exclusive to Narec Capital

Kinetic Traction

• £2m investment

• Narec developed IP

• Commercial model in use

• Consortium build

Aquamarine Power

• Narec sweat equity in Round 1

financing

• Narec developed power take off

• Tested at Narec dry dock

Image provided courtesy of Narec Solar

Advancing Renewable Energy

Incubation & CommercialisationExploiting Strategic Early Stage, High Value, Rapid Return Opportunities

Narec Capitals ‘engineering led’ Incubator focuses on technologies that advance deployment time frames and reduce the cost per MW/H of

renewable technologies:

Industry

Academia

Narec IP

Assessment &

Management

DecisionTRL 3 4 5 6 7 8 9 +2

years sales

Entry Point

10 weeks 1-2 years

TRL 1-3

1 year

Commercial PrototypeEarly Stage Design

‘Promising’ technologies funded:

Advanced Renewable Deployment portfolio

open market

Insurance wrapper

Commercialisation:

Trade Sale

VC

IPO

Multiple deals evaluated:

Market Demand

Disruptive Technology

Robust Business Models

Technical Due Diligence

Grant / Public Funding

Engineering

Development

Validation &

Accreditation

Image provided courtesy of Idermar Image provided courtesy of Idermar

Advancing Renewable Energy

Developers

Supply Chain

Utilities

Ports

OEMs /

Integrators

ManufacturersNational Grid

Financial

InstitutionsGovernments /

SWFs

Wealthy Families

& Business Angels

Entrepreneurs /

SMEs

Covering the Full Industry SpectrumTechnology Meets Capital

Advancing Renewable Energy

International ConnectivityAcademic & Industry Alliances

Advancing Renewable Energy

Example of Spanish/UK Offshore

Marine Technology Development

and Commercialisation project

• Client: Idermar Meteo based at I.H Cantabria

• Proposition : Floating offshore meteorological station

Idermar introduced to Narec Capital at the UKTI British Embassy Madrid

Offshore Wind Supply Chain event 26th October 2010

Idermar clearly have a market leading technical proposition

Idermar needed support with their commercialisation strategy

Narec Capital are engaged to undertake the following:

1. Commercialisation workshop

2. Technical due diligence & independent validation and verification

3. Provide a broad insurance solution

4. Capital fund raising for the next stage of Idermars evolvement

Narec Capital is providing a Seamless Idermar Solution