Taing the risk of being accused as naive again, ALL ESI shareholders should check this Q&A site. I have highlighted some interesting Q&As. Just click on the topic or question links on the page for the answers.
Especially note the merit criteria, and the most technically superior projects may not be selected, referring readers back to the Merit Criteria.
The Merit Criteria are crucial.
Merit Criteria and Assessment • 1. What are the merit criteria? There are three merit criteria:
1. THE PROJECT o Merit of the clearly defined need, objectives and strategies for the Project o Merit and validity of the proposed technical basis of the Project o Appropriateness of the proposed budget, the amount of funding sought from the Program and its leverage versus other sources of Project funding. o Commercialisation plan (including the link to the off-takers and off-take technologies) is credible, including the adequacy of the competitor analysis and understanding of barriers to market entry with appropriate mitigation strategies. o Merit of a clear understanding of the risks for the Project (including possible issues of concern to the community) and strategies for mitigation o The credibility of the link that Respondents make from the output(s) of their upgrading process to the off-takers and off-take technologies for that (those) output(s) that reduce emissions from the use of lignite.
2. THE CAPABILITY AND CAPACITY OF THE RESPONDENT AND ITS PARTNERS TO DELIVER THE PROJECT. o The Project delivery strategy and timeline is well articulated, sensible and realistic. o The financial, technical and Project management strength and capacity of the Respondent and its partners (including a demonstrated track record) to ensure progression of the Project to the next stage towards commercialisation.
3. THE CONTRIBUTION OF THE PROJECT TO THE ALDP PROGRAM OBJECTIVES o Contributes to the Program’s objective of the pre-commercial demonstration scale coal upgrading processes for raw lignite that link to suitable fully integrated end-to-end lignite Projects. These must offer prospective end-use product and / or processes from a broad range of possible applications that maximises low emissions outcomes as well as economic and technological and social benefits from the economic utilisation of the Latrobe Valley’s extensive lignite reserves. Potential applicants will need to be aware that under each merit criteria there are further sub-category questions / requirements that they need to address. See Part C EOI eligibility and merit criteria of the EOI Application and Guidelines.
4. Will the most technically superior projects be selected for funding? Not necessarily. As you will see from the merit criteria, the heaviest weighting is on the capability and capacity of the project proponents to deliver the project. The quality and viability of the technical solution is very important, however, it is critical that the technology can be successfully translated into a viable project in the Latrobe Valley. See Part C Clause 2 - EOI Merit Criteria for details.
General Queries • 1. What is the Advanced Lignite Demonstration Program? • 2. What is a coal upgrading technology? • 3. How many projects will be funded? • 4. Is there a set ratio for private sector investment to public funds? • 5. Who will have ownership of the intellectual property (IP) generated during the proposed projects? • 6. For what period will the funding for this program be available? • 7. What is the timeframe for delivery of the project? • 8. What happens if the project completion is delayed due to some unforseen reason? • 9. Have the government funds been committed and will they be withdrawn if a new government comes into office? • 10. Is it possible to have an extension of time for the EOI, to develop more fully a proposal? • 11. Is it possible to accelerate the grant assessment process to start our project earlier than the published timelines? • 12. Would a copy of the ALDP proponent funding agreement be made available for review before the end of the EOI period? • 13. What commitments to streamlining the approvals processes is the government offering ALDP projects? • 14. Will projects under this program be considered projects of State Significance? • 15. Will the Minister for Planning be willing to fast track approvals for projects under this program? • 16. What are you seeking in terms of security? Is the security requirement reduced as the project proceeds? • 17. Will successful proponents be required to sign funding agreements with both governments? • 18. Can we discuss potential project ideas with you to gauge the level of interest? • 19. We note that 6-8 years is generally considered the minimum operation time for plants of this nature to prove reliability and thus bankability. Will the Program support the project over this time? • 20. What are governments plans for export infrastructure in the Latrobe Valley region? Will plans for infrastructure be made available by 2016 (end of program)? • 21. If we are invited to submit a response to the second stage of assessment (RFP stage), how much time will be allowed to develop the response? • 22. Are applications, including support letters from project partners, treated as Confidential (Commercial in Confidence)? How is this then treated in the event there is an FOI request?
• 23. What assurance can the Government give that it be will be active in supporting development of appropriate transport & infrastructure within a certain timeframe. What can be done to support continued interest from potential investor parties in terms of - at least in some way - addressing their concern over appropriate support for infrastructure development? Eligibility • 1. What types of projects are eligible? • 2. What types of projects are not eligible? • 3. What is a pre-commercial demonstration technology? • 4. Can my project be delivered outside of Victoria? • 5. Who can apply? • 6. Can international companies apply for a grant under the ALDP program? • 7. Can one company lead or partner on multiple applications? • 8. Is there any limitation or restriction to be the lead organisation and principal contact? • 9. Is university or public organisation participation a must? • 10. Are technologies that have been demonstrated internationally or on coals other than Latrobe Valley lignite eligible? • 11. What scale of project will you fund through this program? • 12. My project is only coal drying. Is the project eligible? • 13. Is it a requirement that I need to demonstrate a fully integrated end-to-end project for this Pre-commercial demonstration phase or can I just demonstrate the coal upgrading portion as long as I identify a plan for end processes and products that could be added once the coal upgrading portion is commercial? • 14. Will projects be required to include CCS? • 15. Would previous government funding for the technology be discounted for this ALDP project? EOI Application and Project Development • 1. How do I apply? • 2. Can my company mention that they are applying for ALDP to a third party? • 3. Is there an expectation that the demonstration plant be dismantled at the completion of the project? • 4. Will there be any limit on the number of technologies that may apply to the EOI? • 5. Will there be Stakeholder Workshops? • 6. When will the results of the EOI and the RFP be announced? • 7. Will a lignite supply be made available to projects? • 8. Will the current Latrobe Valley Generators need to be project partners? • 9. The EOI template does not allow sufficient space to provide evidence that we have adequately address the criteria. • 10. If I want to disclose confidential information to government at any time during the Advanced Lignite Demonstration Program, will it be kept confidential? • 11. Will the government be able to facilitate assistance for local fabrication of plant? • 12. In Part C, Section 1.3 of the EOI document, it states that expenditure prior to the signing of the funding agreement is not eligible, however some expenditures such as Front End Engineering and Design (FEED) may able to be claimed and will be considered by the Department on a case by case basis. Can you please provide more guidance under which FEED study costs would be considered as an eligible expense? • 13. What level of commitment is required from project partners in the EOI submission? • 14. Is it acceptable that the main equipment and material used for constructing the project will be sourced/manufactured in another country? • 15. Will the IAP identify possible project partnerships between EOI applicants? Will the IAP consider recommending these suggested partnerships for submission to the second stage of assessment? • 16. How will the panel view the question regarding whether the project will proceed without government support? • 17. How will project milestones and grant instalments allocated to successful projects? • 18. How do I demonstrate an overall reduction in carbon emissions and increase in energy efficiency if my technology / product stream is new? • 19. What level of detail is required for cost estimates, competitor analysis, sensitivity analyses etc for the EOI stage of application Merit Criteria and Assessment • 1. What are the merit criteria? There are three merit criteria: 1. THE PROJECT o Merit of the clearly defined need, objectives and strategies for the Project o Merit and validity of the proposed technical basis of the Project o Appropriateness of the proposed budget, the amount of funding sought from the Program and its leverage versus other sources of Project funding. o Commercialisation plan (including the link to the off-takers and off-take technologies) is credible, including the adequacy of the competitor analysis and understanding of barriers to market entry with appropriate mitigation strategies. o Merit of a clear understanding of the risks for the Project (including possible issues of concern to the community) and strategies for mitigation o The credibility of the link that Respondents make from the output(s) of their upgrading process to the off-takers and off-take technologies for that (those) output(s) that reduce emissions from the use of lignite. 2. THE CAPABILITY AND CAPACITY OF THE RESPONDENT AND ITS PARTNERS TO DELIVER THE PROJECT. o The Project delivery strategy and timeline is well articulated, sensible and realistic. o The financial, technical and Project management strength and capacity of the Respondent and its partners (including a demonstrated track record) to ensure progression of the Project to the next stage towards commercialisation. 3. THE CONTRIBUTION OF THE PROJECT TO THE ALDP PROGRAM OBJECTIVES o Contributes to the Program’s objective of the pre-commercial demonstration scale coal upgrading processes for raw lignite that link to suitable fully integrated end-to-end lignite Projects. These must offer prospective end-use product and / or processes from a broad range of possible applications that maximises low emissions outcomes as well as economic and technological and social benefits from the economic utilisation of the Latrobe Valley’s extensive lignite reserves. Potential applicants will need to be aware that under each merit criteria there are further sub-category questions / requirements that they need to address. See Part C EOI eligibility and merit criteria of the EOI Application and Guidelines. • 2. What is the application process? • 3. What level of project co-funding is required? • 4. Will the most technically superior projects be selected for funding? Not necessarily. As you will see from the merit criteria, the heaviest weighting is on the capability and capacity of the project proponents to deliver the project. The quality and viability of the technical solution is very important, however, it is critical that the technology can be successfully translated into a viable project in the Latrobe Valley. See Part C Clause 2 - EOI Merit Criteria for details. • 5. How do you define the ‘Best Practice’ in the field? Are there any standards? • 6. The EOI requires us to provide evidence that a pilot plant has been built and successfully operated and that results are available for assessment. What do you mean by pilot plant? Can we use a pilot plant for some similar technology as our example? • 7. What do you mean by “mass and energy balance”? • 8. What do you mean by ‘links’ to off-takers and off-take technologies in the commercialisation plan section of the EOI (Section 2.1.4)? • 9. How do you define the “industry standard costs” with regards to market and competitor analysis? Do you have particular standard or data for it (Section 2.1.4 (iii))? • 10. In the risk analysis section (Section 2.1.5) What do you mean by“ Possible issues of concern to the community”? Can you give me some examples? • 11. Section B 2.2.2(i) requires us to provide evidence of current and future business operations which are directly relevant to the Project. What kind of “business operations” are you referring to? Can you give me some examples? • 12. Our company is considering a range of projects with various levels of risk and return. What preference is there from government regarding the preferred risk return ratio? • 13. Is there a requirement for demonstration projects to return a profit? • 14. What percentage of manufacturing/materials need to be domestically sourced? • 15. Who is on the IAP? • 16. What flexibility is there with regards to the timing of the instalments of grant funds over the project life? • 17. We are a relatively small company. How can we demonstrate our capability and capacity to deliver a project of this scale? • 18. How much technical detail should be included in the EOI given that the IAP is unlikely to be familiar with this novel technology? • 19. Will an internationally focused commercialisation plan be looked upon favourably? • 20. Is generation of electricity an eligible end product under this Program? Tax Implications and other government financial support • 1. Will projects be liable to pay for emissions generated during the operation of the demonstration plant? • 2. What you have to do if your ALDP project is liable to pay for emissions? • 3. If the output of the ALDP project is exported are emissions exempted from the carbon price mechanism? • 4. Can an application be made under the Jobs and Competitiveness Program in relation to a ALDP project facility that does not have a direct liability under the carbon price mechanism? • 5. If a Business is eligible for the R&D Tax Incentive will it be able to apply for funding under the ALDP?
ESI Price at posting:
1.5¢ Sentiment: Hold Disclosure: Held
(20min delay)