Hogan Lovell OffshoreBook 2023 230809 OnlinePDF - Flipbook - Page 154
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Japan
be required to understand the decommissioning method, the amount of the
decommissioning costs, the basis for
calculating those costs, and the method
by which those costs will be secured.
With respect to the basis for calculating
decommissioning costs, it is sufficient
to describe the breakdown of costs for
constructing the facility in the ocean and
stating that decommissioning costs are
calculated by multiplying that by 70%.
With respect to the decommissioning
method, it is sufficient to state simply
that it will all be decommissioned or a
part of the facility will be left behind.
The income and expenditure plan needs
to consist of materials that make it possible to grasp the appropriateness of the
income and expenditure plan, including
the investigation and design costs,
construction costs, materials and equipment procurement costs, O&M costs,
removal costs, occupancy fees, equipment utilization rates, income estimates,
and the internal rate of return (IRR). The
IRR needs to use the "pre-tax IRR" based
on the formula set out below. Note that
it is not assumed that the business will
be operating before the operation start
date, and electricity generated during
the commissioning period before the
operation start date is not permitted to
be sold as a business outside the procurement period.
C0+C1/ (1+r)+C2/ (1+r)2+···
+Ct/ (1+r)t=0, where
•
• Ct is the cash flow occurring at time t
and
• r is the internal rate of return (IRR)
k) Selection Process
The selection of a business operator
by public offering is made by (i) examining the business operator’s proposed
occupancy plan to see that it conforms
to the standards listed in each item of
Article 15, Paragraph (1), of the Renewable Energy Sea Areas Use Law; and (ii)
evaluating all plans that conform to the
conformity standards in accordance with
the evaluation standards, and selecting
the person deemed to be most appropriate for enabling the long-term, stable
and efficient implementation of the
power generation business.
l) Evaluation of the Plan
The bidder whose occupancy plan
receives the highest score is selected as
the business operator. The proposed
supply price can receive a maximum of
120 points, and the elements related to
the feasibility of the project can receive
a maximum of 120 points (for a total of
240 points).
The formula used to evaluate the supply
price is as follows:
(lowest supply price / participant’s
supply price) × 120, where
(1)
"lowest supply price" is the lowest
supply price among the supply
prices stated in the occupancy plan
