Business Location - Pittsburgh Regional Alliance

Pennsylvania
Ohio
West Virginia
Maryland
Site Development Fund Submittal Requirement Workshop
Weirton, WV | Cranberry Township, PA | Somerset, PA
16-17 September 2013
Agenda | 90 minutes
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Introductions
Summary Update on the Site Development Fund
CH2M HILL / IDC Architects Site Selection Overview
Site Submittal and Prioritization Process
Questions & Answers
Introductions
Summary Update on the Site Development Fund
CH2M HILL / IDC Architects
Site Selection Overview
Business Location Consulting
CH2M HILL Site Selection Experience & Team
Over 1000 Completed!
North America
United States
Canada
Mexico
Central America
Panama
South America
Brazil
Europe
United Kingdom
Ireland
Spain
Germany
Italy
Czech Republic
Slovakia
Hungary
Poland
Belgium
The Netherlands
Middle East/Asia
Abu Dhabi
Dubai
India
China
Taiwan
Japan
Australia
North American Site Selection / Analysis
CH2M HILL Experience
More Than 1000 Sites Analyzed
NH
WA
VT
MT
OR
MN
ID
WI
SD
IA
NV
PA
NE
UT
OH
IL
CO
MO
IN
OK
NM
WV
TX
VA
KY
NC
SC
AL
DE
MD
AR
MS
CT
RI
NJ
TN
AZ
MA
NY
MI
WY
CA
ME
ND
Sites per State/Province:
< 10
10–30
> 30
GA
Typical Project Requirements:
LA
FL
– Large industrial sites
– Significant water and power users
– Highly specialized/skilled workforce
– Sensitivity to adjacent users and setbacks
Business Location Analysis
PROJECT DEFINITION
• Develop & Define Project Requirements
• Develop Location Scoring Criteria
• Define Search Parameters
BUSINESS LOCATION SCREENING
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Develop detailed business drivers
Collect data and develop analysis methodology
Apply criteria and weighting
Evaluate and reduce location list
BUSINESS LOCATION ANALYSIS
• Prepare RFI and send to reduced list
• Develop financial, schedule & other key assumptions
• Create NPV model
• Initial incentive analysis & negotiations
• Apply NPV & additional analysis to produce final list
SITE ANALYSIS AND SITE SELECTION
• Site Visits & data verification
• Conceptual Site Layout & detailed analysis
• Environmental, Bldg & Dev. Permits & Schedule
• Detailed Site/Building Analysis
• Select Preferred Site(s)
DUE DILIGENCE
• Finalize Incentive MOU
• Site Acquisition
Owner’s Requirements and continual refinement
Representative Consulting Projects
Feasibility Studies
• Due Diligence of Solar PV Mfg for Financing
• Economic Feasibility of LCD Mfg in Brazil
• Market & Economic Analysis of Renewable Power
• Polysilicon Market Analysis – Investment Bank
Capital Project Planning
• Schedule Integration - MEMC, Intel
• DOE Loan Guarantee Project Structuring – Calisolar
• Concept Definition (IE, Estimate, Schedule) : Solopower
Business Location/Site Selection
• International Business Risk & NPV Analysis: First Solar
• Site Selection: Schott Solar, Starbucks
• Site Analysis: Lumileds Malaysia
• Financial NPV Analysis: GE
Business Location – Representative Projects
Site Selection
• Location Evaluation & Incentive Analysis
• Financial Modeling – How do incentives, taxes, and geographically-influenced costs
impact project NPV?
• Business Climate & Infrastructure Assessment
Site Analysis & Permitting
• Site analysis…what are we doing here???
• Assessment of Environmental Permits and Government Approvals
• Review of site infrastructure and barriers to development
Financial Modeling
• Incentive & Tax Analysis
• Utility & Labor Costs
• Project NPV Analysis by location
Site Planning
• Utilize rapid prototyping to test-fit site plan onto finalist sites
Kureha
Business Location Analysis, Incentive Negotiation
PROJECT CHALLENGE: Determine optimal sites for
activated carbon plant, key ingredient for electric
automotive batteries.
OUTCOME: Sited in Charleston, WV. Market conditions
forced delay in implementation.
Project Features
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Screen of 7 southeastern states
First activated carbon plant in the US (raw materials imported from Japan)
Design issues – plant over 100 ft tall.
Evolving technology in battery market / speed to market requirement (Indianabased client purchased 100% of output for 5 years)
Services Provided
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Site selection
Detailed engineering and design services
Negotiation of development and costs from site owner
Full service incentives negotiation ($2 million grant from state of WV)
Project Location:
SE USA
Project Size:
40 million; 5 acres
Project Schedule:
Not applicable to consulting services.
Will be added once plant construction
is complete
Key CH2M HILL Personnel:
William Hearn
Tate and Lyle
Business Location Consulting
PROJECT CHALLENGE: Determine optimal location for
expansion of sucralose production.
OUTCOME: Limited restart of production in McIntosh, AL.
Project Features
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Rapid project completion in order to meet board decision timeline
Availability of chlorine and other key raw materials at the site
Avoidance of expenditures for infrastructure
Global site search (India, Poland, Singapore)
Access to qualified labor – avoidance of high turnover
Project Location:
Global
Project Size:
$40 million on 10 acres (leading to
commercial-scale)
Project Schedule:
Services Provided
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Site Selection (5 sites)
Estimate of equipment relocation costs by scenario
10-Year operating cost model to determine NPV
Identification of proxy sites in India, Poland and Singapore
Estimate of costs for key raw materials
Not applicable to consulting services.
Will be added once plant construction
is complete
Key CH2M HILL Personnel:
William Hearn, John Jordan, select use
of overseas staff
Schott Solar
Business Location Consulting, Incentive Negotiation
PROJECT CHALLENGE: Identify sites for NAFTA expansion
of solar photovoltaic, concentrated solar, and solar cell
production.
OUTCOME: Sited in Albuquerque, New Mexico. Phase One
construction is complete; future phases planned and
designed.
Project Features
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Site selection involving NAFTA region; focus on southwest United States
Collaboration between US-based and German management
Rapid decision timeline to meet customer orders
Risk associated with evolving national regulatory environment for solar support
Services Provided
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Assessed and reviewed over 85 sites in 5 states
20-year NPV operating cost model: labor, taxes, facilities, incentive offsets
Project design, cost estimating and schedule
Full service incentives negotiation ($129 million over 20 years, including
abatement of 95% of property taxes)
 Development Agreement for project participation (federal, state and local
government); $16 million New Market Tax Credits allocation
Project Location:
USA
Project Size:
80 acres; 1,500 employees at full
build-out
Project Schedule:
Not applicable to consulting services.
Will be added once plant construction
is complete
Key CH2M HILL Personnel:
William Hearn, John Frank, Dick
Sheehy, Sharon Schlechter
GE / PrimeStar Solar
Site Selection
PROJECT CHALLENGE: Find the manufacturing location in
the US with the lowest cost per watt for solar panels
OUTCOME: Ten States were selected to be evaluated.
Financial data was collected and the NPV model was used
to narrow the list to three with the lowest cost.
Project Features
 Existing facilities were preferred
 NPV Comparison model was used to eliminate States
 Electricity Cost and Environmental Permitting were major components in the
evaluation
Services Provided
 Net Present Value (NPV) Modeling
 Industrial Engineering Report
 Electricity cost evaluation
Project Location:
Colorado
Project Size:
More than 750,000 sq. ft.
Project Schedule:
3 months
Key CH2M HILL Personnel:
Monty Stranski, Sharon Schlechter &
Dick Sheehy, William Hearn
Confidential Food Client
Business Location Consulting
PROJECT CHALLENGE: Select the ideal location for coffee
processing facility, considering access to ports, labor,
permitting, and availability of local incentives.
OUTCOME: Narrowed location options from 48 states to 3
finalist states.
Project Features
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Screen of states as a lead-in to site search
Logistics issues (raw materials via port / hundreds of source locations)
Environmental Regulation Comparison (air emissions)
Balance of different stakeholder groups in the company to yield an acceptable
shortlist of state
 Access to talent in workforce based on past issues at other locations
Project Location:
USA
Project Size:
$150 million; 125 jobs
Project Schedule:
2011
Services Provided
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Preliminary engineering process review
Assessment of regulatory environment for permitting
State screening (data and phone interviews to assess operating environment)
Preliminary assessment of available incentives
Key CH2M HILL Personnel:
William Hearn, John Browning, Amy
Maule
Site Submittal & Prioritization Process
Site Submittal Requirement Workshops
• Dates & Locations
– September 16, 2013 – Weirton, West Virginia
– September 16, 2013 – Cranberry Township, Pennsylvania
– September 17, 2013 – Somerset, Pennsylvania
• Purpose
– To present the Site Submittal Questionnaire and answer any questions
associated with the document and overall Site Submittal & Prioritization
Process.
Site Submittal Requirements
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20+ useable acres preferable (smaller sites acceptable) with adaptable
topography and flood plain status
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Description of applicant – political subdivisions, non-profit
organizations, and for-profit entities
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Demonstration of site control (fee ownership or option to purchase)
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Environmental site assessments – Phase I & Phase II, if available
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Must be commercial/industrial areas; zoning ordinances preferred
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Preliminary cost per buildable acre analysis & project funding request
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Sources & uses of funding schedule (commitment to prepare pads
within 1 year) and status of any funds (committed, received & applied)
Site Submittal Questionnaire
• Applicant organizations will fill out the Site Submittal Questionnaire
in order for an understanding of the candidate sites
• The Site Submittal Questionnaire will provide criteria to effectively
compare the various sites to one another within the various regional
target industries
• The Site Submittal Questionnaire will be available to all workshop
participants. Invitees unable to attend the workshops and other
relevant parties will be able to access the form via web link on the
Pittsburgh Regional Alliance (PRA) website PittsburghRegion.org
to reach and encourage a broad base of applicants to the fund
Site Submittal Questionnaire
Initial Site Screening
• In conjunction with resources from the PRA, CH2M HILL will screen
the sites submitted for consideration by the fund
• This initial site screening will include a preliminary desktop
evaluation and site ranking of the top 16 sites for further evaluation
• The following screening criteria will be employed:
– Completeness and clarity of the site information;
– Conformance of the site to the pre-qualification criteria;
– A subjective assessment of the apparent site readiness and
attractiveness for development.
Target Industry Evaluation
• Regional industry targets and more specific evaluation criteria will
be developed for up to six sectors that emerge from the site fund
applicants
• CH2M HILL / IDC Architects will rank the top 16 sites within the
appropriate target industry sector
• Power of 32 / PRA representatives will review and sign-off on the
ranking with the highest scoring sites invited to present to the Market
Advisory Team established for the project
Logistics / Distribution
• Market Access
• Highway Access
• Traffic Impact
• Land cost
Data center
• Fiber Access
• Electricity Cost and Quality
• Risk Factors
• Latency
• Speed to Market
Technology Manufacturing
• Industry Cluster
• Speed to Market
• Taxes – Real Estate and Equipment
• Electricity – Quantity, Cost and Quality
• Quality of Life
• Water and Waste Water capacity
Office and Research & Development
• Technology Link – University
• Jobs
• People
Heavy Industry
• Raw Material
• Market Access
• Labor Cost
• Zoning
• Local Support
• Environmental Permits
• Electricity - Quantity, Cost and Quality
Site Presentations
• The top 7 to 10 highest scoring sites will be invited to give site
presentations
• CH2M HILL Site Selection professionals will participate in the
interview evaluation along with Power of 32 Market Advisory Team
and PRA representatives
• Site presentations will be evaluated against a scoring methodology
to determine final site ranking and recommendation for further due
diligence and funding discussions
Outline Schedule
• September 16-17, 2013 – Site Submittal Requirement Workshops
• October 9, 2013 – Site Submittal Questionnaires due from
applicants
• Late October – Initial Screening & Shortlist of 16 Sites
• Early November – Development of Target Sector Evaluations and
Site Scoring
• Mid-November – Site Presentations and Presentation Evaluations
• December – Selection of top sites for initial funding discussions
Questions & Answers