“It does not have to be complicated to get regular and guaranteed income on your investments along with positive contribution to sustainable development of environmental protection.”
How does it work?
- Pipeline of green energy projects: IQ’s Green Energy team is continuously monitoring and supporting projects that are in the process of being prepared by initiators and developers of renewable energy sources. The projects vary from size and type of source. In general we are interested in projects of biomass (up to 1 MW), wind turbines (up to 10 MW) and solar (up to 2 MWp). For larger projects we co-operate with institutional investment companies.
- Project Financing:
When the project reaches an advanced stage of development, it is then introduced to IQ’s Green Energy investors. Every project will have its specific details, but in general the Modus Operandi is as follows:
- The investor provides a loan to IQ Green Energy against annual interest and profit share for the duration of 5 to 15 years. The interest and profit share will generate a guaranteed annual yield for the investor, varying from 8 to 12% return on investment. Yields and repayment instalments are paid annually.
- The developer (after obtaining all requirements such as permissions, licences, contracts and approved bank debt capital finance) obtains equity finance up to 80% of the total equity required for the construction of the project. Depending on the level of financing and other markers, IQ Green Energy becomes a shareholder in the project and assumes position in the management board of the operation of the renewable energy source.
By investing in Green Energy sources through IQ Green Energy Investments, investors secure their financial means long-term with guaranteed return on investment. The return on investment is guaranteed by interest on loan and profit share in the project. On average the interest generates ¾ of the return and the profit share ¼ of the guaranteed return on investment. The profit share is linked to the guaranteed production of the renewable energy source, which may provide a higher return than guaranteed.
Example:
Solar project up to1MW.
Total investment: 3 million Euro.
Total required equity: 600.000 Euro.
Equity loan through IQ Green Energy Investments (80%): 480.000 Euro.
The investor obtains:
- Annual interest 7.5%
- Profit share of 50% of profit over shares of IQ Green Energy Investments (guaranteed 50% profit is 13.450 Euro, representing 2.8% ROI).
- 10.3% annual guaranteed return on investment obtained by the investor.
There are many factors that need to be taken into account before the investment criteria and conditions can be finalized for each different project considered by IQ Green Energy. In general IQ Green Energy stipulates three major conditions concerning the ownership and operation of the project:
- Profit over shares: the profit which IQ Green Energy obtains as a shareholder decides which percentage of shares will be required by IQ Green Energy Investments.
- Vote over shares: the percentage of shareholders vote of IQ Green Energy Investments has to guarantee IQ’s Green Energy investors their safe long-term investment.
- Vote in the management board: idem ‘Vote over shares’.
Reasons why to invest in renewable energy producing projects:
1) Supporting the environment through responsible investments.
This nature-friendly way of investing is supported by the state government as well as the European Union guarantees investments in renewable energy sources.
2) Technology is far developed.
For the past few decades astounding progress in technology of renewable energy source has been made. It has now reached the level at which also smaller renewable energy projects are feasible.
3) Growing energy sector.
Getting energy from fossil fuels and uranium is being replaced by renewable sources. More and more large and small renewable energy sources are being developed.
4) Guaranteed purchase and buy-out price of “green” electricity.
The regional distributors and transmission system operator are obliged to purchase electricity from renewable sources and to conclude a contract for the supply, if producers offer electricity according to the conditions of Section 5 and prices in accordance with Section 6 of Law No. 180/2005 Coll. These laws guarantee the buy-out price and the actual purchase of the produced electricity for 20 years. These are national laws which are supported by the European Union.
5) Guaranteed inflation indexation of the buy-out price of “green” electricity. During the lifetime of power plant the purchase price is yearly increased in accordance with the industrial Producer Price Index (PPI) with a maximum of 4%. If the PPI is negative the price remains on same level as the previous year.
6) Big energy potential.
In the Czech Republic (middle European country) the conditions are suitable for the operation of Solar-plants, Biomass-stations and wind-turbines (although less wind-energy potential due to restricted locations).
The largest piece of the energy cake in the Czech Republic belongs to coal plants (60,7%) and nuclear plants (21,4%) with a distance following large hydro plants (12.4%) and gas plants (4,6%). The share of other alternative sources including biomass is very small (0.9%), while the target is to have 8% energy coming from renewable energy sources by the end of 2010. There is a new target set at 12% energy from renewable sources by the year 2015.
Company details:
| IQ Green Energy Investments (IQ Fund management s.r.o.) | |
| Registered seat/postal address: | Rehnice 8, 294 06 Brezno u Mlade Boleslavi, Czech Republic |
| Email: | greenenergyinvestments@iq-group.info |
| Tel: | +420-312312057 |