PHAROS SOLAR ENERGY PSE Mohmed Hamdy Mohmed 3135822

PHAROS SOLAR ENERGY “PSE” Mohmed Hamdy Mohmed : 3135822 Dheeraja Cheenakula : 3135786

INTRODUCTION �Energy is one of the basic necessities in day-to-day life and its importance is well known. �Sun is Available daily and we should use it in Energy to reduce air pollution, carbon dioxide emissions resulting from the burning of diesel and mazut. �The cost of generating electricity from solar energy decreased from 359 $ per megawatt / hour in 2009 to 79 $ in 2014, a decrease of 78% in just five years. �International research and technology -particularly Germany- have brought down the cost of the production of electricity from solar energy from about 40 cents to eight cents per kilowatt �Our business ensures the importance of Solar Energy and how to invest in this field in Egypt and grow fast in a market needs energy ASAP.

MARKET ANALYSIS � Egypt is currently considered an electricity-poor country, meaning that its annual electricity output (31, 600 megawatts) is low compared to the total population (92 million). � Egypt is working to reach a level of electricity production of 85, 000 megawatts by 2030. Renewable and new energies, including solar and wind energy and biogas, are important components of this target, set to make up 20 per cent of all energy produced by 2022 and 35 per cent by 2030. � This requires the establishment of solar power stations, each with a productive capacity of 1, 000 megawatts, with a targeted production of 15, 000 megawatts by 2030.

• A state solar energy project should not stop only with the construction of a number of solar plants every year. It should also include the establishment of integrated industrial compounds to produce photovoltaic components that rely on quartz (widely available in Egypt’s Eastern Desert and in Sinai), including highgrade poly silicon, ingots and wafers, and the photovoltaic cells used to produce PV modules. • This can help meet the construction needs of local solar power stations instead of importing such components from abroad. The construction of solar plants with a capacity of 1, 000 megawatts annually will bring in annual investments of (11 -13 billion LE(600 million $ ). This includes the import of the components, estimated at 9 -10 billion L. E (450 -500 million $ ) annually, of which some LE 56 billion (250 million $ ) is for photovoltaic modules.

• Egypt is located geographically between latitudes 22 and 31. 5 north, so the Egypt is at the heart of the global sunbelt, and thus it is one of the richest countries in the world solar Energy. • The annual average number of hours of sunshine per day ranges between 9 hours to 11 hours in the desert south of Egypt, and increase the hours of sunshine to 3, 600 hours a year in most parts of Egypt with 3000 K watt h / year.

Average weather in EGYPT Month Jan Feb March April May June July Aug Sep Oct Nov Dec Average Temp in Celcius 14 14 17 21 25 27 28 28 26 23 19 15

Global Horizontal irradiation & irradiation in Egypt

PSE BUSINESS PLAN �PSE aims to Economic and Eco-friendly availability of Energy which is from sun. �Our main focus is on buildings of houses, Universities, Schools, Offices, Restaurants and Transit places. �PSE is a self marketing strategy which benefits the customers in a low level in houses, universities, schools and ect, and feel the difference in paying and saving there money which encourages them to tell new people and increase using the new renewable energy plus a huge campaign to aware people the importance of using the renewable energy.

THE COMPANY �It is a company by partnership with limited liability (two partners). �Imports the solar panels and distribute it to our target customers �With an installed capacity for processing of 250 Watt of energy per each solar panel.

COST CALCULATIONS

INVESTMENT COSTS-PROPERTY �Land : 1000 m 2 @ price each meter = 10000 LE ( 500$ ) �Total Property Value : 10000000 LE ( 500000 $ ) �License and Registrations : 500000 LE ( 25000$ ) with 50% encouragement reduction from government total = 250000 L. E ( 12500$ ) �Total : 10, 250, 000 ( 525000 $ )

BUILDING COSTS BUILDING Administration office AMOUNT 1, 000 The Stores 1, 000 Parking 200, 000 Engineering Costs 500, 000 Miscellaneous 400, 000 Total 2, 900, 000 Ø Exchange rate 1$ = 20 L. E & all prices are in L. E

MACHINERY COSTS Machines & equipments Price Amount Depreciation rate by % Depreciation Cost 250 watt / solar panel 1386 100000 20 110, 880, 000 Transportation Cars 300, 000 5 20 300, 000 Maintainance tools 100, 000 5 20 100, 000 Total costs 140, 600, 000 Total Depreciation Cost Ø Exchange rate 1$ = 20 L. E & all prices are in L. E 11, 128, 000

INVESTMENT AND FINANCING Total Investment 150, 000 Bank Loan @ 10% interest 50, 000 Own Capital Funds 100, 000 Ø Exchange rate 1$ = 20 L. E & all prices are in L. E

FINANCING COSTS year Balance of debit Interest rate 1 50, 000 12. 5 6, 250, 000 5, 000 2 45, 000 12. 5 5, 625, 000 3 40, 000 12. 5 5, 000, 000 4 35, 000 12. 5 4, 375, 000 5 30, 000 12. 5 3, 750, 000 5, 000 6 25, 000 12. 5 3, 125, 000 7 20, 000 12. 5 2, 500, 000 5, 000 8 15, 000 12. 5 1, 875, 000 9 10, 000 12. 5 1, 250, 000 5, 000, 000 12. 5 625, 000 Sum of Interest Sum of Repayment Interest Costs per year Refunding Bank Loan 34, 375, 000 50, 000

LABOUR COSTS Labor Costs Number of persons Manager 2 Supervisors 3 Maintenance Engineers 3 Administration and Staff 4 Technicians 5 Labor 10 Drivers 5 Security 10 Labor cost to company per month 200, 000 Labor cost to company per year 2, 400, 000 ØExchange rate 1$ = 20 L. E & all prices are in L. E

INSTALLATION COST • One solar panel produces 250 watt. h is about 1. 25 M 2 and we need about 1500 watt. h then we need 6 solar panels with space about 8 m 2 to enough our needs from Electricity for month 200 K. watt. h because we need roughly about 6. 5 k. watt. h daily. ( 200 k. watt. h / 30 days =~ 6. 5 K. watt. h ). • Price for 1 solar panel produce 250 watt. h is 1386 LE and we need 8 then the total @ 11088 LE • Price for installation above the roof of the building for system produce average monthly 200 K. watt. h @ 4000 LE • The total price for installation the new source of energy is 15000 LE

INSTALLATION COST year 1 2 3 4 5 6 7 8 9 10 Total no of sales 10, 000 10, 000, 000 10, 000, 0 00 10, 000, 0 00 10, 000 cost of one solar panel about 1. 25 m 2 1386 1386 1000 1000 11088 11088 11088 10, 01 1, 088 10, 011, 0 88 10, 008, 0 00 10, 008, 000 cost of 8 m 2 solar panel ( 6 panels *1. 25 m 2 = ~ 8 m 2 ) Total Cost

Year 1 CONSUMPTION COSTS 2 3 4 5 6 7 8 9 10 Installation cost 10, 011, 088 10, 011, 088 10, 008, 000 10, 008, 000 Marketing and Advertisem ent 100, 00 0 100, 000 50, 000 50, 000 Utilities (energy) 600, 00 0 600, 000 600, 000 Transporta tion 100, 00 0 100. 000 100. 000 Maintenanc e 50, 000 50, 000 50, 000 Total consumptio n cost 10, 861, 088 10, 861, 088 10, 811, 088 10, 811, 088

SELF COSTS Year 1 2 3 4 5 6 7 8 9 10 Deprecia tion Cost 11, 128, 00 0 11, 128, 00 0 11, 128, 00 0 Finance cost 6, 250, 000 5, 625, 000 4, 375, 000 3, 750, 000 3, 125, 000 2, 500, 000 1, 875, 000 1, 250, 000 625, 000 Consum ption cost 10, 861, 08 8 10, 861, 08 8 10, 811, 08 8 10, 811, 08 8 Labor cost 2, 400, 000 2, 400, 000 2, 400, 000 Total Cost Number of solar panels Cost of one solar panel 30, 639, 088 30, 014, 088 29, 389, 088 28, 764, 088 28, 139, 088 27, 464, 088 26, 839, 088 26, 214, 088 25, 589, 088 24, 964, 088 100, 000 100, 000 100, 000 1386 1386 1000 1000

PRICE DEFINITION �The self costs for the installation of solar panel to produce 250 watt. h is 1386 LE and we need 8 then the total @ 11088 LE. �Total cost for installation is @ 15000 LE. �If the space is more it will be a offer for universities, huge buildings and huge factories.

CASH FLOW Year 1 2 3 4 5 6 7 8 9 10 Depreci ation cost 11, 128, 0 00 11, 128, 0 00 11, 128, 0 00 Finance cost 6, 250, 00 0 5, 625, 00 0 5, 000, 00 0 4, 375, 00 0 3, 750, 00 0 3, 125, 00 0 2, 500, 00 0 1, 875, 00 0 1, 250, 00 0 625, 000 Consu mption cost 10, 861, 0 88 10, 861, 0 88 10, 811, 0 88 10, 811, 0 88 Labor Cost 2, 400, 00 0 2, 400, 00 0 2, 400, 00 0 Total cost 30, 639, 08 30, 014, 08 29, 389, 08 28, 764, 08 28, 139, 08 27, 464, 08 26, 839, 08 26, 214, 08 25, 589, 08 24, 964, 08 8 8 70, 000, 0 71, 000, 0 72, 000, 0 74, 000, 0 75, 000, 0 75, 000, 0 00 00 00 Sales revenue

CASH FLOW Year 1 2 3 4 5 6 7 8 9 10 Profit before tax 20, 000, 000 20, 000 21, 500, 000 22, 000 23, 000 24, 000 Tax on Profit 0% 0% 0% 30% 30% 30% 20, 000, 000 20, 000 14, 700, 000 15, 050, 000 15, 400, 000 16, 100, 000 16, 800, 000 Profit after tax Cash flow (Deprec iation + 31, 128, 00 31, 128, 00 25, 828, 00 26, 178, 00 26, 528, 00 27, 228, 00 27, 928, 00 Profit) 0 0 0 0 0 Repay ment of Credit 5, 000, 0 00 5, 000, 0 00 5, 000, 0 00 Dividen d 26, 128, 00 26, 128, 00 20, 828, 00 21, 178. 00 21, 528, 00 22, 228, 00 22, 928, 00 0 0 First 5 years no Taxes encouragement from the government to the investment in renewable energy

Return on Investment 250, 000 200, 000 L. E 150, 000 100, 000 Dividend Investment 50, 000 Year 0 0 1 2 3 4 5 6 7 8 9 10

CONCLUSION ØOur business plan is an environmental friendly approach to provide affordable clean and cheap Energy for along time to our consumers. As this approach is from the first of leading companies in its kind in Egypt to supply requires consumer from the energy, we have presumed a minimal consumer participation in the initial years and it gradually increases in the further years. ØWith such reasonable assumptions, our profit yield can be maintained more or less constant for the considered period. ØOur future plan is to open a new unit to manufacture the solar panels in line with our requirements.

PHAROS SOLAR ENERGY - Save the Polar go Solar