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HEP-Solar Japan 1 – successfully placed!

HEP – Solar Japan 1 is an Alternative Investment Fund (AIF), intended for private investors, which wish to participate in the attractive growth opportunities offered by the Japanese photovoltaic market.

Japan's potential for solar power has been a reminiscent of the great development opportunities for photovoltaics in Germany since the beginning of the new millennium. Especially in the south, the solar radiation is 22% above the world average and even 30% higher than in Germany.

It was the Fukushima disaster that called to Japan's population and their political leaders` minds that the unilateral use of nuclear power is at risk. The country now wants to reduce its dependence on nuclear power and expensive energy imports and wants to convert its supply of energy.

By the year 2030, according to the plans of the Japanese government, the share of renewable energies in the production of electricity will be at least 20 percent. This is approximately twice as high as at the moment. The legal requirements have been set. In 2012, the Japanese government introduced a feed-in tariff model for photovoltaic systems according to the German model.

The new HEP – Solar Japan 1 invests in in four already fixed, large solar farms in the vicinity of Osaka. About the thus achieved diversification, the investment is designed conservatively. The plan is an average payout of 9% p.a.

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HEP-Solar Project Development V

The aim of the fund company is to develop and to sell solar parking rights in Japan. This project will be developed with a total size of 25 MWp. A solar park hereby represents all the agreements that are necessary to build a solar farm and operate at least the statutory period of guaranteed feed-in tariff.

In the coming years Asia will evolve as the largest PV market. Experts believe that China will be the largest market, followed by the USA, Germany and Japan.

By 2020, Japan aims to increase its share of electricity generated from renewable sources from the current 1 percent (excluding hydropower) to 20 percent. The climatic conditions in Japan are ideal for photovoltaics. The U.S. investment bank Jefferies & Company assesses the Japanese funding as one of the world's most attractive for commercial investors. For the coming year the Bank of Japan predicted more than a ten percent share of the world market for photovoltaic systems located in Japan.

The delivery head for large plants in Japan is fixed and guaranteed for 20 years, which can make this appear to be a relatively low-risk type of investment. Jefferies & Company predicts a return of investment of six per cent, but also emphasizes that this estimate is very conservative. In particular, the module prices underlying the calculation could be far below in practice. Total returns of 20 percent are therefore more likely than the conservative estimate of six percent.

The Japanese "EEG" is very similar to the German "Renewable Energy Law". Not only the principle of the priority network supply but also the cost compensation has been adopted.

The expected rate of return (IRR) is at about 10.66% pa, the planned duration of the participation ends on 31/12/2016

HEP Solarfonds England 1
(already placed)

The solar park with a total area of 18 hectares is located approximately 10 kilometers southeast of the popular resort of Newquay, Cornwall in the southern UK, the sunniest part of the country. The radiation intensity in Cornwall is comparable to southern Germany. On 28 July 2011, the 5 mega-watts peak (5 MWp) large solar farm was taken in operation. The attractive feed-in tariff was hereby secured for the next 25 years, which in England is currently at 30.70 pence/kWh (34.60 ct. *) plus export surcharge, for the parks, which feed electricity and do not consume. The feed-in tariff applies to all systems connected to the grid until August 1st, 2011 and is guaranteed for 25 years. There is an adjustment for inflation over 25 years.

The facility consists of modern TÜV certified crystalline silicon modules from Bosch Solar Energy AG, Erfurt, with a 25-year performance warranty. Bosch Solar Energy AG, Erfurt was also the general contractor of the plant. The inverter and monitoring system was provided by the world market leader SMA Technologie AG and the technical inspection was carried out by Evergy Engineering GmbH as an independent reviewer. Advanced technology and German know-how ensure maximum yield. A conservative calculation provides a maximum investment security for all investors. Thorsten Etile, CEO of HEP Capital AG: "Once again we are able to market an exciting product and thereby once again underline a sense for unusual and yet balanced and profitable investments. Therefore we predict a backflow of about 352 percent (before tax) for the solar park to investors of England 1 over the entire term of 25 years - applying the usual high standards of our company."

This results in a predicted total payout of over 352% before tax over the entire term of 25 years. Financing by a major German bank also ensures a security interest over the entire term of the fund.

Solar Fund Nordendorf
(already placed)

Sunny Nordendorf – Nordenforf is located about 25 km north of Augsburg in the south and sunny part of Germany. The solar park is located on the B2 and has a total area of 19.5 hectares. The system is already in operation since December 2009 and since then produces clean solar electricity that is fed with a guaranteed fee of 31.94 cents / kWh in the public power grid. The entire park has a total capacity of 7.5 MWp and mathematically covers the electricity needs of about 2,700 households.

Quality from A to Z – The system consists of modern TÜV-certified crystalline silicon modules from Moser Baer with a 25-year performance warranty. The inverter and the monitoring system is supplied by the world market leader SMA Technologie AG and the technical inspection was carried out by Evergy Engineering GmbH as an independent reviewer. Draka Service GmbH is responsible for ongoing management and life time maintenance, including a performance guarantee – and for unforseen events our all risk insurance is available. The latest technology and german know-how guarantee maximum yield.

Reliability in the fund concept – A conservative calculation provides a maximum investment protection for all investors. Due to the high legal refunding at low module prices high payouts of 7.5% pa to over 30% can be predicted. Funding through a German bank also guarantees an interest rate steadiness throughout the fund life.

HEP Solarpark Spremberg
(already placed)

The solar park Spremberg is located on the busy highway Forster Landstraße on a former military site on a total area of 19.5 hectares. The facility consists of modern silicon modules by the German solar company Q-Cells, Bitterfeld-Wolfen. The solar power plant has a total capacity of 5,300 kWp and the 24,000 solar modules will provide nearly 1,900 households with clean electricity and at the same time save 4,400 tons of CO² each year. The minimum investment amount is EUR 10.000 and has a projected total dividend of 260% over 20 years before tax. With the investment in HEP Spremberg Solar GmbH & Co.KG the investor has income from business operations. A detailed description of the tax treatment can be found in the share issue prospectus. The interest was placed within a few weeks and was concluded in April 2010.

HEP-Solar Private Equity II
(already placed)

The goal is the development of four solar projects in the south of England. Compared to Germany, a new feed-in (Renewable Obligation Order, since April 2010) in the UK promises an approximately 61% higher rate of compensation for plants added to the grid in 2011. The expected rate of return (IRR) is 10.8% pa, the planned duration of interest ends 31.12.2012.

HEP-Solar Private Equity I
(Private Placement, placed, settled)

The HEP Solar Private Equity I developed solar projects in Germany. The placement was completed within a week. The planned end of investment was on 31.12.2010. In May 2010 the HEP-Solar Private Equity I concluded with an achieved rate of return (IRR) of around 16% pa, wich surpassed the prospected return by about 110%.

Further Information

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HEP Capital AG

Römerstraße 3
74363 Güglingen
Phone +49 (0) 7135 93446-0
E-mail: info@hep-capital.com