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What are different project "buckets" and associated "…
What are different project "buckets" and associated "components that banks should consider when evaluating rural mini-grid projects and C/I DER projects?
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External interactions
Regulatorary
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RURAL ISOLATED: For not interconnected assets: confirmation with DisCo on non-interference with 5-year expansion plan, or assurance the site is outside an existing IEDN
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partnerships
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RURAL: use of REA initial 250+ sites while they released 250 good ones, other ones might still be good, review wasn't comprehensive
DisCo Interactions
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TRIPARTITE: initial contract term, renewal term lengths and comparison against debt tenor
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TRIPARTITE: are distribution assets owned by the developer, owned by DisCo (with utility paying usage fee) or part of a split asset model?
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TRIPARTITE: If the DisCo is contributing to distribution system expansion (or receiving a usage fee), how will that payment get disbursed? (ie rate based, repaid through annual payments)
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TRIPARTITE: If the developer is paying for distribution expansion/improvements, will the loan cover the costs of this expansion? If not, does the developer have set aside cash/equity to cover these costs?
Financial metrics
project financials
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RURAL ISOLATED: calculation of required payment if DisCo were to enter area (for isolated minigrid) and comparison against debt service
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Developer Considerations
Industry Exposure
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BOTH: operational expertise (vertically bundled, EPC, operator)
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Credit worthiness
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BOTH: ownership structure (incorporated, partnership, etc)
BOTH: escrow account, letter of credit, DSRA
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