Tabreed District Cooling Company

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 IFC is considering making an equity investment in a District Cooling Company (“DCC” or the “Company”) proposed to be set up in Singapore (the “Project”) along with National Central Cooling Company (“Tabreed” or “Sponsor”). The initial focus market of DCC will be India but the company may expand to undertake business in other Asian geographies at a later stage. National Central Cooling Company PJSC is a UAE-based regional utility company which is listed on the Dubai Stock Exchange. Tabreed was established in 1998 and currently delivers over 1.40 million refrigeration tons (RT) of cooling, across 86 plants located throughout the Gulf Cooperation Council (GCC). DCC through special purpose vehicles (‘SPV’) in India will enter into long term concession agreements with major real estate developers, governments or municipalities to deploy district cooling (‘DC’) systems/technology in commercial, industrial and retail establishments or mater plans across India. DCC’s projects will in many cases be just one part of a larger real or industrial estate project. DCC enters into three types concessions: (a) to acquire, operate and maintain (O&M) the existing operational cooling systems in an existing building, campus or industrial establishment (referred to as brownfield projects); (b) to design, finance, construct, install and undertake O&M of DC system for a greenfield/under construction building, campus or industrial establishment (referred to as greenfield projects); and (c) to set up a centralized, standalone DC facility to serve multiple buildings or industrial establishment in an area/city/municipality (referred to as centralized DC project). Further, DCC’s facilities and operations are typically situated within the building, campus or premises of the existing building or industrial establishment in brownfield projects. However, in greenfield projects, DCC’s facilities and operations may be located within the building or premises of the buildings or industrial establishments or outside the premises as well. In centralized DC projects, the company’s facilities are typically standalone facilities located outside the premises of the buildings or industrial establishments to which the DC is being provided. In centralized DC projects, typically the company delivers the cooling water at a connection point for a building/industrial establishment/premises and all equipment/facilities within the premises are operated and maintained by the building/industrial establishment/premise owner/facility manager. The company currently does not have any operating or under construction project in India but is currently discussing projects with several potential clients. The company is in early stage discussion for the following prospects: (i) a brownfield project, a real estate development (an information technology special economic zone with[six buildings) on a 25.27 acre premise), which has R134a based 11100 RT of centralized cooling; (ii) two greenfield projects - one industrial establishment (a pharma city) to be developed on 7,823 ha and an information technology (IT) park with 12 buildings to be developed on 78 acres of land. Land acquisition for the pharma city is currently underway and it will have centralized cooling with R134a based 3000 RT chillers with provision for scaling up as demand grows up to 51000 RT. The IT park is under construction which will also have centralized cooling R134a based with 36000 RT chillers and thermal energy storage (TES) tank of 6000 RT, at full capacity for cold water at 5 degree Celsius; and (iii) one centralized DC system for a city municipality, which is expected to provide DC to seven different buildings/real estate developments requiring 10180 RT of cooling. The centralized cooling facility will be located on a 3500 m2 parcel of land owned by and in possession of the municipal corporation. The pipeline from the centralized cooling facility to the recipient buildings/premises will be laid within the right of way (RoW) of existing roads. Typically, in a centralized DC system, the company builds a standalone single storey facility which require a plot size of about 3100 to 4200 m2 for 5000 RT to 15000 RT of DC plant capacity to house the chiller, control room and offices. The chilled water is piped to the recipient buildings through pipes laid in the right of way (RoW) of existing roads or utility corridor. In case of greenfield projects, like in case of pharma city or the IT park, a centralized DC system can also be put in place, but this is typically located within the premises of the project site. Chillers may also be located within individual buildings in greenfield projects. The DC plants deploy high efficiency water-cooled chillers to generate chilled water to be distributed through pipelines to establishments. Thermal energy storage is used to supplement the chilling load and optimize power consumption. Cooling water is sourced from either the building’s sewage treatment plant or municipal connections and electricity is sourced from the grid or through third party open access arrangements (renewable energy is used if agreed with the master developer). Diesel generator (‘DG’) sets are used to provide backup. The entire system is SCADA-integrated for remote operation and automation.