Back

Energy production plant
100% Funded

100%
Need:0.00€
Interest rate:19.5%
Period:24 months
Target: 450 000€
Opens: 2019/02/07
Expires: 2019/02/21
Type: Specialized
Location: Riga, Latvia
Investments: 369

Summary


An energy company “Powerhouse Sarkandaugava” LTD is planning to raise capital to develop a 15 MW biomass boiler house located in industrial zone of Riga city. Energy production plant is going to be connected to district heating system of Riga.
District heating system in Riga is owned and managed by municipality owned operator JSC “Rigas Siltums” which buys thermal power from independent energy producers. There are only seven energy production plants in Riga.
The shareholder of development company is well known and experienced in energy sector – owns and manages the same size and type energy plant – a 15 MW biomass boiler house which is, as previously mentioned, one of the seven thermal power production plants in Riga.
Current investment opportunity offers CROWDESTOR investors to make a loan with 19,50% annual interest rate.
Minimum target to be raised in CROWDESTOR platform is EUR 200 000,00 and the maximum target is EUR 450 000.00.
 

Loan

Minimum target: EUR 200 000,00.
Maximum target: EUR 450 000,00.
Loan term: 24 months.
Interest rate: 19.50% per annum.
Interest payments: paid monthly after first 6 months. For first 6 month interest payments are capitalized and paid in bullet payment together with the Loan principal payment.
Loan repayment: In full at the end of the Loan Term.
Early repayment: In case of early repayment of the Loan, the Borrower pays 10% from scheduled Interest Payments.
Security:

  • Guarantee by Borrower;
  • Mortgage on real estate;
  • BuyBack guarantee of the Crowdestor Buyback Fund.

 


 

Remember, interest rate payments start calculating from the day you make your investment!

 


 

Project


Biomass boiler house with a capacity of 15 MW is being developer in Riga. Technology includes a water heating boiler with nominal output 12MW and a flue gas condenser which increase energy output in a range of 14 MW and 15 MW, depending on humidity of wood chips and daytime temperature.
Business concept – 100% of thermal power will be sold to district heating operator in Riga city AS «Rīgas Siltums».
Loan will be used to partially finance development expenses. The main expense positions are the following:

 

  • 35 000 EUR – initial sketch design including the process of receiving all technical rules for connecting the necessary engineering communications (natural gas, water, district heating system, electricity, sewerage)
  • 30 000 EUR – technical and cost efficiency audit for the solutions offered by technology supplier and architect
  • 150 000 EUR – down-payment for acquisition of the real estate. Total real estate acquisition price is 517 000 EUR
  • 60 000 EUR – implementation of environmental impact assessment
  • 120 000 EUR – implementation of full technical project
  • 25 000 EUR – legal costs
  • 20 000 EUR – other unexpected, administrative costs
  • 10 000 EUR – receipt of construction permit of Construction Authority of Riga


 

Technical details


 
It is planned to install Austrian technology - “Kohlbach” K12-12000 HW furnace and water heating three-step boiler with a capacity of 12 MW. Permissible safety pressure for this technology is 10 bar and operating temperature of 125°C.
The boiler house can ensure a continuous heat production 24/7 during all year. System is connected to the heat exchanger of JSC “RĪGAS SILTUMS”. Wood biomass is planned to be used as the fuel. It is planned to produce up to 100 000 MWh of heat energy per year.
Delivery of wood chips to the boiler house is planned by using road transportation heavy trucks with moving floors. Wood chips are loaded exactly onto to the moving floors of the boiler house. The trailers are equipped with moving floors, which means that the vehicle pushes wood chips (instead of dumping) through the back of the trailer, approximate freight capacity is 100 m3. Road vehicles with half-trailers of moving floors are equipped with a cover, which during the transportation fully excludes any distribution of dust in the surrounding environment. The closed wood chip acceptance area is enclosed by walls from all sides (metal frame with planking), it can be entered through the liftgate. After the wood chips have been delivered and unloaded, wood chips are fed to the water heating boiler with the help of hydraulic sliders. The technological process provides immediate supply of the wood chips to the boiler unit for combustion. The planned fuel reserve, which will be fully stored in the covered warehouse, will not exceed the consumption of 7 days under maximum load. It is technically possible to operate the boiler house at the maximum load of more than 8000 h/year.
For purification of flue gases after the boiler, before the air preheater a multicyclone is designed to purify the flue gases from the solid particles, ash particles, providing the maximum concentration of 180 mg/m3.
Wood chips have high moisture content, which along the outflowing flue gases causes large heat losses during the combustion process. Thanks to water spraying in the fuel gas flow fuel gas condensation method allows to recover a significant part of this heat and significantly increases the efficiency of the boiler. Flue gas condensed increases total energy out-put up to 15MW per hour.
The operation of the fuel gas condenser economizer is fully automated according to the temperature schedule.

Water heating boiler with furnace


“Kohlbach” K12-12000 HW furnace has been installed in the boiler house and water heating three-step boiler with a capacity of 12 MW, the maximum permissible safety pressure of 10 bar and the maximum operating temperature of 125°C.
Constructively the boiler device consists of interconnected parts of power source: primary furnace, secondary furnace and boiler. The secondary furnace and boiler are connected above the primary furnace. In the boiler the fuel gas pipe system is positioned vertically.

Fuel gas and ash system


The fuel gas system consists of chimneys, multicyclone, air preheater, smoke pump, fuel gas condenser economizer with fuel gas fan and chimney. A by-pass is planned around the primary heat carrier of the gas condenser economizer that allows the maintenance of the condenser without interrupting the boiler operation.
For purification of fuel gases after the boiler, before the air preheater a multicyclone is designed to purify the fuel gases from the solid particles, ash particles, providing the maximum concentration of 180 mg/m3.
Combustion air preheater is equipped with automatic compressed air fuel gas purification system to provide higher efficiency of the heating surface.
Wood chips have high moisture content, which along the outflowing fuel gases causes large heat losses during the combustion process. Thanks to water spraying in the fuel gas flow fuel gas condensation method allows to recover a significant part of this heat loss and significantly increases the efficiency of the boiler.
The operation of the fuel gas condenser economizer is fully automated according to the temperature schedule, a condenser smoke pump is designed to overpower the resistance of the device.
Fuel gas temperature in condenser operating mode is 48.5°C at 40% fuel humidity; heat carrier secondary circuit return temperature is 45°C or 53.5°C at 60% fuel humidity; heat carrier secondary circuit return temperature is 50°C, and fuel gas temperature after the boiler (without condenser in active operation mode) is 200°C at 40% fuel humidity and 175°C at 60% fuel humidity. The fuel gas condenser economizer also reduces the content of the hard particles in the fuel gases to 100 mg/m3.
Separate stand-alone insulated steel chimney at the height of 35 m is planned for fuel gas discharge.
With the help of ash screw conveyor the ashes from the ash chain transporter and from the multicyclone and air preheater are fed to the ash chain transporters, which deliver them to the ash container. The ash container is closed, and the planned volume of it is 10 m3. According to the planned consumption of wood chips – 50 000 t/year (with a fuel ash content of 1.65% and flying ash content of 154 kg/year), it is expected that about 880 t of ashes will be generated in a year. It is planned that at the average capacity of the boiler house the container will have to be emptied once every two days.

 
 

Thermal power market in Riga


 
The buyer of thermal power – municipality and government owned district heating operator AS «Rigas Siltums». Total heat demand in Riga is ~ 2 500 000 MWh pey year.
Demand for thermal power in Riga is 24/7/365.
Our forecasted max annual production is 100 000 MWh which is only 4.0% from total demand.
Thermal energy produced is going to be sold trough a tender to AS «Rigas Siltums». As the major part of thermal energy is purchased from large cogeneration plants owned by the State energy company AS Latvenergo, which are considered as having a dominant role in energy market, and its thermal power price is public and regulated by The Public Utilities Commission. Strategy for Borrower to give a price of 1-10% lower than AS Latvenergo depending on season.
As thermal power market in Riga is a subject of supervision by Public Utility Commission and Competition Authority, thermal power sales agreements with district heating operator “Rigas Siltums” are identical for all 7 energy companies.
The heat supply system in the summer period from end of april till beginning of october is united and all 7 energy producers are competitors. During the heating period when heat demand increases even more than 10 times, two separate heating zones are created by district heating operator - TEC-1 and TEC-2 heat supply zones.
TEC-1 heating zone - there are two energy producers in this zone - Eco Energy Riga and Latvenergo TEC-1.
TEC-2 heating zone - there are 5 energy producers in this zone - Juglas Jauda, Energia Verde, Rīgas Enerģija, Rīgas BioEnerģija un Latvenergo TEC-2.*
“Sarkandaugava Powerhouse” boiler house is being developed in the heating zone TEC-1, where is less competition.
*Information from the Competition Council Case No. 3114/09/05/1.
 

The 7 competitors


 

Company Electrical out-put Thermal power out-put Technology Zone where object is located
Latvenergo TEC-1 144 490 Natural gas cogeneration and natural gas boiler hous TEC-1
Eco Energy Riga 15 Biomass boilerhouse TEC-1
Rīgas BioEnerģija 48 Biomass boiler house TEC-2
Rīgas Enerģija 4 20 Biomass cogeneration TEC-2
Juglas Jauda 12 15 + 8 Natural gas cogeneration and biomass boiler house TEC-2
Energia Verde 4 20 Biomass cogeneration TEC-2
Latvenergo TEC-2 832 1124 Natural gas cogeneration and natural gas boiler house TEC-2

 


 

About the Borrower


The Borrower is an SPV “Powerhouse Sarkandaugava” SIA, a company registered in the Republic of Latvia with registration number 40203189833, established by CROWDESTOR OU sistercomany “CROWDESTOR INVESTMENTS” SIA. The Shareholder and CEO of “Powerhouse Sarkandaugava” SIA is Janis Timma, who is also shareholder and CEO of CROWDESTOR OU and CROWDESTOR INVESTMENTS SIA.
Janis has been actively engaged in energy sector since 2010, focusing on development and capital raising for different type and size energy plants. He has been Head of Energy department in BDO Law for 6 years. Since 2013 Janis is CEO of Latvian Cogeneration Association and is having active role in communication with government institutions regarding improvements of energy sector regulation in Latvia. Janis is also CEO and shareholder of 14 MW biomass boilerhouse in Riga. Educated in Finances at University of Latvia, Law at Business University Turiba and in WU Executive Academy, program Executive Energy Expert.
 

SWOT

Strong, opportunities

 

  • Total heat demand in Riga is ~ 2 500 000MWh per year. Our annual  production is 100 000 MWh which is  only 4% from total demand;
  • Simple technology, lifetime for equipment is 25+ years;
  • Senior debt paid in less than 7 years;
  • Main competitor in TEC-1 zone will stop operations due to end of subsidies;
  • Experienced developer.

Weak, threats

  • Price increase of wood chips;
  • New competitors.

Subscribe to newsletter

Subscribe to our newsletter and stay updated on the latest investments and special offers!