Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

KENYA ASSOCIATION OF MANUFACTURERS

CEEC

TERMS OF REFERENCE

DETAILED FEASIBILITY STUDY

RFP Number CEEC / FSS/2/2017

SOLAR PHOTOVOLTAIC (PV)

KENYA

June 12, 2017

Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

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Project Background
The Kenya Association of Manufacturers (KAM) is collaborating with the Ministry of Energy and
Petroleum of the Government of Kenya and DANIDA to promote renewable energy & energy
efficiency activities in the country, with a view to reducing energy costs among Kenyan
enterprises. KAM has received a request from the project sponsors for the development of
renewable energy projects. The project sponsors were selected as a result of KAMs work under
the CEEC & Energy Audit Initiatives. For these projects the KAM/CEEC team:

Will coordinate between the consultant and the client;

Will sign Non-disclosure and Confidentiality agreements with project sponsors;
CEEC has assisted in developing these terms of reference for a detailed feasibility study;
In the event that the detailed feasibility study turns positive, KAM may then pass the project
to partner banks for financial consideration.

Specific Objectives of the Study

The detailed feasibility study will provide KAM with advice on the Solar Photovoltaic power
generation potential of the pre-qualified sites. In addition, the studies will identify barriers to
project development. The objectives of the study are to:

Identify physical and economical aspects for developing Solar PV power projects at the
chosen site(s).
Examine the local topography, resource assessment and provide an initial assessment of the
project(s) viability
Identify key areas of risk and suggest mitigation actions
Determine the economic viability of each site/s
Evaluation of the site/s to identify the most suitable option for location of structures
Develop detailed designs of the PV system and grid tie connection assessment and design
Develop a roadmap for the next steps going forward (pre-planning)

The study should provide clear advice on which options are the most viable, and where
subsequent decision-making will need to balance various factors against each other.

Ideally, the consultant should provide advice on a range of potential business models, indicating
the strengths and weaknesses of each.

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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

Scope of the study

The scope of work is to conduct a detailed feasibility study, which will include:

1.0 Site Visit

1.1 Preparation of the site visit

Print maps, aerial photos or satellite images of the site
Print the site visit questionnaire (IA_Site Visit Questionaire.xls) which is the questionnaire
shall help gather all necessary information on the site needed for a final judgement on its
suitability
A Digital camera, compass and GPS are mandatory to capture site local data.

1.2 Execution of the site visit

When driving to the site pay attention to important properties of the area surrounding
properties:
Land cover and general land use situation
Activities of the local population and industry
Infrastructure state including road conditions
At the site the following activities shall be performed on site while filling out the site visit
questionnaire:

a) Obtain a general overview of the location

b) Find the compass points and especially direction towards East-West
c) Look after the boundaries of the proposed property and draw them in the map
d) Write down and save the coordinates of the site from the GPS including the map datum
or projection information.
e) Check and advise the topography and morphology of the site
f) Figure out the approximate slope of the terrain
g) Estimate the predominate wind direction and exposure to high wind loads
h) Evaluate the air pollution and dust load situation; this can also be derived from the land
cover.
i) Assess the shadow situation
j) Draw all obstacles on the borders of the site from East-to-West into the map and take
photographs
k) Repeat the same for any obstruction within the site (transmission line poles, pumping
house, protective walls and fences, etc.)
l) Take a series of pictures that will be stitched to a panoramic view starting from East to
West
m) Complete the remaining items of the site visit questionnaire
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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

n) It is recommended to take meaningful photographs. Any detail that may affect the
usability of the gross area of the property as shall be documented on the map and
supported by corresponding photos.
o) The GPS can be used to note down coordinates of important marks on the site. If the GPS
is left in track recording mode, the pictures can be associated to the walking path
afterwards.
p) Ensure all criteria and questions of the site visit questionnaire have been filled.
q) Perform an Energy Needs Assessment of the client:
Determine current energy sources;
Advise on the main energy uses;
Determine annual energy consumption (kWhs);
Determine annual energy cost (KShs);
Create load profiles.

1.3 Classification of Criteria and Characteristics

After the site visit evaluate the impressions gained by revising the notes taken on the site
questionnaire and identifying sites which are affected by severe blockers such as huge external
shading obstacles or difficult topography.

2.0 Conceptual Design

Conceptual design, along with demand identification and analysis, makes up the initial stage of
the design process of a plant. The need analysis transforms the often vague statement of a design
task into a set of design requirements. Conceptual design encompasses the generation of
concepts and integration into system-level solutions, leading to a relatively detailed design
specifications for the principle components and plant parameters.

Carryout the following steps to determine the basic technical parameters and conceptual layout:

a) Determine the size of the roof top of the property investigated. Determine roof top
size to be used for the Solar PV power plant;
b) Select a module type, size and a suitable price point;
c) Size and Type of Inverters; Recommend inverter manufacturers and a suitable inverter
type. Advise recommended price point;
d) Select a mounting structure or racking system for the modules;
e) Define the elevation of the modules in single, double or triple rows, as well as upright
or crosswise direction;
f) Define the capacity of the plant
g) Create a preliminary layout of the plant by use of specialised software simulation (e.g.
PVSyst etc.);

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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

h) For construction and O&M purposes consider to leave sufficient space between the
panels for a maintenance;
i) Create a preliminary, top view plant layout with a drawing program showing the
dimensions and location of the area required for the complete plant.

The information and values obtained during the concept design process may then be summarised
in the respective section (Concept Design Information) of the sheet step 3 site development in
the Site Assessment Matrix.

4.0 Yield Assessment

After the basic plant parameters have been defined in the conceptual layout, this technical data
shall be used as input for the Annual Energy Production (AEP) Forecast. The results of the yield
assessment shall be added to the respective section (Annual Energy Production Information) of
the sheet step 3 site development in the Site Assessment Matrix.

5.0 Electrical Interconnect Study

The Contractor will conduct an interconnection study, evaluating the connection of electricity
from the project site to the grid.
The Contractor will examine all the aspects of grid interconnection challenges, including selection
of Point of Interconnection (POI) on the grid, utility regulatory and technical requirements, grid
capacity limitations.

The work in this task will focus on:

review of the Kenya Electricity grid code
Proposing the suitable Point of Interconnection (POI)
Identifying equipment and material requirements of the proposed (POI)

The Interconnection Report shall contain the results of the interconnection study, any major
technical issues or fatal flaws with the interconnection, and a detailed economic review of the
interconnection costs.

6.0 Statement on Technical Project Feasibility

As an outcome of the above activities, a definite statement on the technical feasibility of the
priority site with sufficient solar and roof top space resource, as well as suitable main
infrastructure and first production estimation is obtained.

All information during the site assessment is now contained in the respective sections and sheets
of the Site Assessment Matrix. It will represent the input for the further financial analysis and
final evaluation of the site(s).
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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

6.0 Detailed Cost Estimate Preparation

The Consultant will prepare detailed costs estimates for the engineering, procurement and
construction, based on the conceptual designs. The estimates will include equipment and
materials, as well as associated components such as electrical interconnection and permitting
requirements. After preparing the conceptual design for the PV installation, the Consultant will
generate a detailed cost estimate capturing estimates for all primary and ancillary equipment
and materials.

PV module
Balance of System Costs (including civil works and security)
Inverter and system controls,
The components required for mounting and racking the PV system,
The combiner box and miscellaneous electrical components,
Site preparation and installation
Labor costs for installation and grid connection
System design, management, installer overhead, permit fees and any up-front financing
costs.

7.0 Implementation Plan

The Consultant shall prepare a detailed Implementation Plan designed to provide for
implementation of the project in a timely manner and in a cost-effective way. The
Implementation Plan will establish sequence of tasks, assign responsibility for each process and
task, and determine corresponding time limits for their implementation.

8.0 Financial & Economic Analysis

The Contractor shall perform a detailed financial evaluation that shall include:

a) Estimate of Capital Expenditure (Capex) and Operations & Maintenance (O&M);

b) Assessment of parameters for Financial Viability (project IRR and NPV, DSCR, RoE,
discounted Payback);
c) Comparison of funding scenarios;
d) Sensitivity analysis;
e) Risk identification matrix for financial risks, mitigation strategies;
f) Benefit calculation (avoided fuel demand and CO2 emissions);
g) Parameters for Economic Viability (Present Value of cost and benefits, LCOE, IRR, cost-
benefit ratio);
h) Identification of the least cost option.

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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

9.0 Permitting, Environmental and Social Impacts

a) Planning and consents required (e.g. ERC, Grid connection, PPA, NEMA etc.);
b) Potential permitting and environmental constraints;
c) Environmental impacts of the project (s);
d) Discuss any Risks of developing the project at the site, and how these risks are
best mitigated going forward;
e) Evaluate and discuss the social impacts of the project (e.g. job creation, revenue,
technology and skills transfer etc.).

The resulting report will summarize the different project options for the project sponsor in terms
of the powerplant layout, the scale of generation, the likely income from the project, key
assumptions made, variations of costs etc. It should also include a high level risk assessment
based on the identified options and provide clear recommendations for KAM on how best to
develop the project and any specific requirements for later project phases.

Assignment Methodology

Consultants should propose how they intend to approach the delivery of the requirements set
out above. Where possible the project should be phased to include break points, such that any
barriers identified in the development of the project that would completely prohibit further
development, should be outlined. KAM will determine, in consultation with the appointed
consultant, whether the project should proceed further.

KAM would expect the following activities to be included:

Initial introductory meeting with KAM to assess needs, preferences and aspirations, as
well as to agree ways of working, timeframe, logistics, etc.;
Confirm the scope of works following the introductory meeting with any amendments /
adjustments to the proposal highlighted and issued. It is anticipated there will be minimal
changes;
Site visits to conduct surveys and data collection;
Regular progress reports and close liaison and collaboration with KAM;
Presentation to KAM of the findings and draft reports, with opportunities for discussion
and questions. The outcome of this will be used to finalize the reports.

Expected Outputs

The expected outputs are stated in the scope of works. These are predominantly in a report
format or specific to the deliverables.
1) An inception report which shall include inter alia the site questionnaire
2) A preliminary report should be provided electronically, and will include the site visit
report, economic and financial analysis and conceptual design
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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

3) A draft final report should be submitted (electronically) for comments.

4) A meeting with KAM, and any other parties invited by KAM, should be held to present the
draft report and receive comments and suggestions for the final report.
5) Following comments, three hardbound copies of the final deliverable will be provided to
KAM. In addition, an electronic copy (CD) of the final report is to be provided.

Project Timetable

The key milestones are:

July 7th, 2017: Consultant(s) pre-qualification completed and contracting
July 12th, 2017: Project initiation Consultant(s) meeting with KAM and visits to project
sites
August 7th, 2017: Submission and presentation of the preliminary report
August 17th, 2017: Submission of draft Final report
August 30th, 2017: Submission of Final report

There is flexibility in the timetable for the project phases and details of the timescales for
completion of each phase will be agreed with selected consultant at the project initiation.

Start and Duration of Work

The Consultant is advised that the Work is anticipated to commence upon receipt of the award
letter from KAM, and the execution of a contract for services associated with the detailed
feasibility Study. The Consultant should be in a position to staff the project and immediately
proceed with the Work. Unless a different completion date is agreed to in the contract, the
Engineer shall complete the Work associated within forty five (45) calendar days of execution of
the contract.
Any questions regarding the terms of reference for the detailed feasibility should be emailed to
the KAM contacts below:

Email: ceecteam@kam.co.ke

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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

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Annex 1
Sample Contract for Consultant Services

CONTRACT FOR CONSULTANTS SERVICES

Between

KENYA ASSOCIATION OF MANUFACTURERS

And

_________________________________

Dated:

THIS CONTRACT (Contract) is entered into this ___________________, by and between

_____________________________ (the Client) having its principal place of business at
_____________________________ [Clients address], and _________________________ (the
Consultant) having its principal office located at __________________________.
WHEREAS, the Client wishes to have the Consultant perform the services hereinafter referred to,
and WHEREAS, the Consultant is willing to perform these services,

NOW THEREFORE THE PARTIES hereby agree as follows:

1. Services
(i) The Consultant shall perform the services specified in Annex A Terms of Reference,
which is made an integral part of this Contract (the Services).
(ii) The Consultant shall provide the personnel listed in Annex B, Consultants Personnel,
to perform the Services.
(iii) The Consultant shall submit to the Client the reports in the form and within the time
periods specified in Annex C, Consultants Reporting Obligations.

2. Term
The Consultant shall perform the Services during the period commencing _________ [starting
date] and continuing through ___________[completion date], or any other period as may be
subsequently agreed by the parties in writing.

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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

3. Payment

A. Ceiling
For Services rendered pursuant to Annex A, the Client shall pay the Consultant an amount not to
exceed ______________________________. This amount has been established based on the
understanding that it includes all of the Consultant's costs and profits as well as any tax obligation
that may be imposed on the Consultant.

B. Schedule of Payments
The schedule of payments is specified below:
30% upon the Client's submission of the inception report;
40% upon the Client's receipt of the preliminary report, acceptable to the Client; and
30% upon the Client's receipt of the final report, acceptable to the Client

C. Payment Conditions
Payment shall be made in ________ [currency], no later than 30 days following submission by
the Consultant of invoices in duplicate to the Coordinator designated in paragraph 4.
IBAN and BIC references shall be provided together with the first request for payment.

4. Project Administration

A. Coordinator
The Client designates Mr./Ms. ___________________ as Client's Coordinator; the Coordinator
will be responsible for the coordination of activities under this Contract, for acceptance and
approval of the reports and of other deliverables by the Client and for receiving and approving
invoices for the payment.

B. Reports
The reports listed in Annex C, Consultant's Reporting Obligations, shall be submitted in the
course of the assignment, and will constitute the basis for the payments to be made under
paragraph 3.

5. Performance Standards
The Consultant undertakes to perform the Services with the highest standards of professional
and ethical competence and integrity. The Consultant shall promptly replace any employees
assigned under this Contract that the Client considers unsatisfactory.

6. Confidentiality
The Consultants shall not, during the term of this Contract and within two years after its
expiration, disclose any proprietary or confidential information relating to the Services, this
Contract or the Client's business or operations without the prior written consent of the Client.
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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

7. Ownership of Material
Any studies reports or other material, graphic, software or otherwise, prepared by the Consultant
for the Client under the Contract shall belong to and remain the property of the Client. The
Consultant may retain a copy of such documents and software.

8. Consultant Not to be Engaged in Certain Activities

The Consultant agrees that, during the term of this Contract and after its termination, the
Consultant and any entity affiliated with the Consultant, shall be disqualified from providing
goods, works or services (other than the Services and any continuation thereof) for any project
resulting from or closely related to the Services.

9. Insurance
The Consultant will be responsible for taking out any appropriate insurance coverage.

10. Assignment
The Consultant shall not assign this Contract or sub-contract any portion of it without the Client's
prior written consent.

11. Law Governing Contract and Language

The Contract shall be governed by the laws of Kenya, and the language of the Contract shall be
English.

12. Dispute Resolution

Any dispute arising out of the Contract, which cannot be amicably settled between the parties,
shall be referred to adjudication/arbitration in accordance with the laws of the Kenya.

13 Corruption
The Consultant declares that:
a) he did not engage in any action to influence the Project implementation process to the
detriment of the Client, in particular no collusive practice took place nor will take place,
and the selection proceedings, contract negotiations, award, and execution have not and
will not be subject to any corrupt practice as defined in the United Nations Convention to
combat corruption dated 31 October 2003.

14. Environmental and Social Standards

The Consultant undertakes to:
(i) comply and procure that its Sub-consultants, if any, comply with international
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Terms of Reference RFP Number CEEC / FSS/2/2017 Solar Power feasibility Study

environmental and labour standards consistent with applicable law and regulations in the
country of implementation of the Project, including the fundamental conventions of the
International Labour Organisation (ILO) and international environmental treaties;
(ii) adopt any environmental and social risk mitigations measures as defined in the
environmental and social management plan or the notice of environmental and social
impact issued by the Client.

FOR THE CLIENT: FOR THE CONSULTANT:

Signed by ______________________ Signed by ________________________

Title: ______________________ Title: ________________________

June 12, 2017