Sustainergy Holding - Politecnico di Milano€¦ · The entry key to Solar Street Lighting market...

The entry key to Solar Street Lighting market in the Middle East and GCC

Sustainergy Holding

Supervisor: Prof. Federico Frattini Assistant Supervisor: Vito Manfredi Latilla

2018/2019 Academic Year

School of Industrial and Information Engineering

Master of Science in Management Engineering

(Energy and Environmental Management)

Master Graduation Thesis

Ibrahim El-Said Desouky, 863177

Acknowledgement

I would first like to thank my thesis supervisor prof. Federico Frattini and the advisor Prof.Vito

Manfredi of the school of management engineering at the Polytechnic of Milan. It’s gratitude

because since day one he believed my idea of building my company (Sustainergy) and

supported me with business contacts to reach a fast growth with a positive result. Besides, the

door to Prof.Vito office was always open whenever I ran into a trouble spot or had a question

about my research or writing.

I would also like to praise the marketer expert Prof.Marco Gatti with his entrepreneurial

mentality who were involved in the validation survey for this research project. Without their

passionate participation and input, Sustainergy could not have been successfully built, and the

validation survey could not have been successfully conducted. I would like to thank him from

the bottom of my heart for his collaboration, patience and the investment in the idea.

I would also like to acknowledge the General Manager of Sunmaster Engr. Steven Zang, who

was very generous to provide his technical knowledge to reach the success point and I am

gratefully indebted to his valuable comments on the technical part of this thesis.

I would like to notice, appreciate and thank all the support and motivation from my team

colleges Valentina Sofia and Super Mary (MariaGrazia) that have positively affected the final

result. Highly greeting for your work.

Last but not least, the massive gratitude from the moon and back to all my family members,

one by one regarding the tremendous priceless support.

Table of Contents

Abstract ................................................................................................................................... 1

Executive summary ................................................................................................................. 2

Introduction ............................................................................................................................ 2

Aim of the study ...................................................................................................................... 3

Methodologies ........................................................................................................................ 3

1. Chapter one (regulations and market circumstances) ............................................... 4

1.1. Circumstances of the energy market in Egypt............................................................ 4

1.1.1. Regulations for Energy efficiency in Egypt ................................................................. 4

1.1.2. The main objectives of the electricity sector strategy ............................................... 5

1.1.3. The Egyptian government role to support renewable energy ................................... 6

1.1.4. The actions to achieve energy efficiency improvement in Egypt .............................. 6

1.1.5. The environmental impacts regarding actions ........................................................... 6

1.1.6. Solar Irradiation in Egypt ............................................................................................ 7

1.1.7. Increasing the potential SSL applications in Egypt ..................................................... 8

1.2. Circumstances of the energy market in the GCC countries ....................................... 9

1.2.1. Solar Irradiation in GCC ............................................................................................ 11

1.2.2. GCC countries’ targets toward energy efficiency & renewable energy ................... 12

1.2.3. GCC countries plans and strategies toward renewable energy ............................... 14

1.2.4. Kingdom of Saudi Arabia .......................................................................................... 14

1.2.5. United Arab Emirates ............................................................................................... 14

1.2.6. Bahrain ...................................................................................................................... 15

1.2.7. Kuwait ....................................................................................................................... 16

1.2.8. Oman ........................................................................................................................ 16

1.2.9. Qatar ......................................................................................................................... 17

1.2.10. Conclusion from the GCC market analysis ............................................................... 17

2. Chapter two (technologies) ...................................................................................... 18

2.1. The lighting lamps ..................................................................................................... 18

2.1.1. Incandescent Lighting ............................................................................................... 19

2.1.2. Solid-State Lighting ................................................................................................... 19

2.1.3. Gas Discharge Lighting .............................................................................................. 20

2.1.5. Smart Lighting projects in Italy (European reference) ............................................. 26

2.2. Solar panels ............................................................................................................... 29

2.2.1. Monocrystalline silicon solar panels......................................................................... 30

2.2.2. Polycrystalline silicon solar panels ........................................................................... 31

2.3. Battery ...................................................................................................................... 31

2.3.1. Lead Acid battery ...................................................................................................... 32

2.3.2. Lithium-Ion battery ................................................................................................... 32

2.4. Controllers ................................................................................................................ 34

2.4.1. Types of controllers used in the solar streetlight applications ................................ 35

2.4.2. Advantages of controllers ......................................................................................... 36

2.5. Metal structure ......................................................................................................... 36

2.5.1. Poles .......................................................................................................................... 36

2.5.2. Arms .......................................................................................................................... 37

2.5.3. Brackets .................................................................................................................... 38

2.5.4. Corrosion protection ................................................................................................ 39

2.5.5. Thermic galvanisation ............................................................................................... 39

2.5.6. Powder coating ......................................................................................................... 40

2.6. Cables ........................................................................................................................ 40

2.6.1. Cables Definition ....................................................................................................... 40

2.6.2. Cable components .................................................................................................... 41

2.6.3. Battery cables with lugs ........................................................................................... 42

2.6.4. Battery interconnects ............................................................................................... 42

2.6.5. PV arrays’ cables ...................................................................................................... 42

2.6.6. Connectors ................................................................................................................ 42

2.7. Smart management control systems........................................................................ 43

2.7.1. The approaches and devices of the MCS .................................................................. 43

2.7.2. The advantages of the MCS ...................................................................................... 45

2.7.3. Sunmaster MCS technologies ................................................................................... 45

2.8. Technologies of the Solar Power System ................................................................. 46

2.8.1. Inverters .................................................................................................................... 46

2.8.2. Basic electrical specifications of the On-Grid power inverter .................................. 48

2.8.3. Diagnostics and reporting information .................................................................... 51

2.8.4. The types of solar power systems ............................................................................ 52

2.9. The types of solar streetlight .................................................................................... 55

3. Chapter three (market analysis) ............................................................................... 57

3.1. PEST analysis ............................................................................................................. 57

3.1.1. The advantages of PEST analysis .............................................................................. 57

3.1.2. Factors of PEST analysis ............................................................................................ 57

3.1.3. Practical PEST analysis on the Egyptian market ....................................................... 58

3.1.4. Opportunities and threats of the political factors .................................................... 60

3.1.5. Opportunities from PEST analysis ............................................................................ 60

3.1.6. Threats from the PEST analysis ................................................................................ 61

3.1.7. Actions toward exploiting the opportunities and avoiding the threats ................... 61

3.2. SWOT analysis ........................................................................................................... 61

3.2.1. Introduction of SWOT analysis ................................................................................. 61

3.2.2. Strengths of PV market ............................................................................................. 62

3.2.3. Strengths of Sustainergy ........................................................................................... 62

3.2.4. The weakness of the PV market ............................................................................... 62

3.2.5. The weakness of Sustainergy ................................................................................... 62

3.2.6. Opportunities for Sustainergy .................................................................................. 63

3.2.7. Threats for Sustainergy ............................................................................................. 63

3.2.8. Recommendations .................................................................................................... 63

3.2.9. Conclusion of the SWOT analysis ............................................................................. 64

4. Chapter Four (Competitive advantages strategies).................................................. 65

4.1. The engines of growth .............................................................................................. 65

4.1.1. Exploitation of the engines of growth ...................................................................... 65

4.2. Competitive advantage............................................................................................. 66

4.2.1. Cost leadership strategy for Italwarmi & Sustainergy .............................................. 67

4.2.2. Cost leadership and Porter’s five forces ................................................................... 67

4.3. Strategic Alliance concept ........................................................................................ 68

4.3.1. Advantages of the strategic alliance......................................................................... 68

4.3.2. The Risks of Strategic Alliance .................................................................................. 69

4.3.3. Applications of the strategic alliance theory in Italwarmi & Sustainergy BMs ........ 69

4.4. Benchmarking ........................................................................................................... 70

4.4.1. Introduction of the Benchmarking ........................................................................... 70

4.4.2. Comparison between GE and Sunmater .................................................................. 71

4.4.3. Comparison between Sol and Sunmaster ................................................................ 72

5. Chapter five (Italwarmi & Sustainergy Business Models) ........................................ 73

5.1. Business Model Canvas ............................................................................................ 73

5.2. Italwarmi Business Model ........................................................................................ 74

5.3. Kuwait Salem Air Force Base case study .................................................................. 78

5.3.1. The project description ............................................................................................. 78

5.3.2. Determination of the project configuration ............................................................. 79

5.3.3. The Lighting configuration ........................................................................................ 87

5.4. Market players of SSL & SPS ..................................................................................... 88

5.4.1. Stakeholders identifications ..................................................................................... 88

5.4.2. The evaluation processes ......................................................................................... 89

5.5. The project phases .................................................................................................... 91

5.5.1. Project Development ................................................................................................ 91

5.5.2. Implementation phase ............................................................................................. 93

5.5.3. Performance measurement ..................................................................................... 93

5.5.4. Handover .................................................................................................................. 94

5.6. Startup introduction ................................................................................................. 94

5.6.1. The Startup theory .................................................................................................... 94

5.6.2. The lean startup methodology ................................................................................. 95

5.7. Sustainergy business model ..................................................................................... 96

5.8. Case Study for the Higher Technological Institute in Egypt ................................... 100

5.8.1. Project description .................................................................................................. 100

5.8.2. Project result .......................................................................................................... 102

5.9. Future development of Italwarmi & Sustainergy ................................................... 103

5.9.1. Blue ocean theory ................................................................................................... 103

5.9.2. Product & Service innovation ................................................................................. 104

5.9.3. Energy efficiency service ........................................................................................ 105

References .......................................................................................................................... 106

List of Tables

Table 1: part of the revenues of Sunmaster, Italwarmi and Egytalia in 2019. ............................ 2

Table 2: current and futuristic installation capacity of the renewables in the GCC. Source:

Middle East Electricity’s report. ................................................................................................. 13

Table 3: Comparison between the lighting technologies, the data are extracted from the

following sources: Lighting technologies comparison. http://www.gigavision.com.au/study-

centre/lighting-technology-comparison , Studying material of Economic Assessment for

Energy Efficiency Solutions in industrial buildings. Prof. Giovanni Toletti, 2017, Catalogue from

the technical department in SunMaster and Isolar. China. ....................................................... 23

Table 4: comparison between the smart lighting projects in Italy, affirming LED is the best

available technology in the lighting applications. Sources: Reverberi, ASSIL, Phillips Italia

projects references..................................................................................................................... 28

Table 5: comparison between the types of solar panels. Source: studying material of Energy

management & sustainability Prof. Vittorio Chiesa. .................................................................. 29

Table 6: comparison between LFP and Gel battery. Source: solar electricity handbook,

Sunmaster batteries’ technical data sheet. ............................................................................... 34

Table 7: the relation between the number of solar arrays and the nominal and max. voltage.

Source: solar electricity handbook 2017. ................................................................................... 49

Table 8: practical analysis of PEST model factors. Source: World Bank, market research

reports, the global economy websites. ...................................................................................... 59

Table 9: benchmarking between GE Vs Sunmaster. Source: Sunmaster technical data sheet,

price lists, GE technical data sheet and prices. .......................................................................... 71

Table 10: benchmarking SOL Vs Sunmaster. Sources: Sunmaster technical data sheet, price

offer, Sol Inc technical datasheet and price offer. ..................................................................... 72

Table 11: choosing the optimal LED wattage. Source: Sunmaster technical department. ....... 79

Table 12: feasibility analysis for HTI project. ........................................................................... 102

Table 13: prices and technical specifications of the All in One. Source: Sunmaster price offer.

.................................................................................................................................................. 102

Table 14: prices and technical specifications of the split system. Source: Sunmaster price

offer. ......................................................................................................................................... 103

List of Figures

Figure 1: electricity production 2015 in Egypt. Source: International Energy Agency. ............... 4

Figure 2: electricity consumption 2015 in Egypt. Source: International Energy Agency. ............ 4

Figure 3: 30/35 vision for electricity production in Egypt. Source: MERE. .................................. 6

Figure 4: the solar irradiation map of Egypt. Source: Global Solar Atlas. .................................... 8

Figure 5: BenBan solar sark project in Aswan, Egypt. Source: Forbes Middle East. .................... 9

Figure 6: global share of Oil & Gas production. Source: petroleum study and research centre

of KSA. .......................................................................................................................................... 9

Figure 7: solar Irradiation map in the GCC region. Source: International Renewable Energy. . 11

Figure 8: renewable energy targets in the GCC countries. Source: International Renewable

Energy Agency. ........................................................................................................................... 12

Figure 9: Incandescent Lamp. Source: Phillips catalogue. ........................................................ 19

Figure 10: LED Lamp configuration. Source: Sunmaster online course. ................................... 19

Figure 11: diagram of Gas Discharge Lighting. ........................................................................... 20

Figure 12: diagram of the Induction Lighting. ............................................................................ 21

Figure 13: typical life of standard lighting technologies. Source: the elusive “life” of LEDs: How

TM-21 contributes to the solution. LEDs Magazine, November 2011. ...................................... 25

Figure 14: Monocrystalline Solar Panel. Source: Amerisolar technical data sheet. .................. 30

Figure 15: Polycrystalline Solar Panel. Source: Amerisolar technical data sheet. ..................... 31

Figure 16: GEL Battery. Source: Sunmaster catalogue. .............................................................. 32

Figure 17: Lithium Ion battery chemical reactions. Source: Studying material of fundamentals

of energy technologies Prof. Matteo Zago (Polimi). .................................................................. 33

Figure 18: Controller. Source: Sunmaster catalogue. ................................................................ 34

Figure 19: diagram of how the PWM controller works in the SPS. Source: Sunmaster online

course. ........................................................................................................................................ 35

Figure 20: diagram of how MPPT controller works in the SPS. Source: Sunmaster online

course. ........................................................................................................................................ 35

Figure 21: the arms position in the solar streetlight system. Source: Sunmaster catalogue. .. 37

Figure 22: drawing of the arm design. Source: Sunmaster technical data sheet. ..................... 38

Figure 23: drawing of the connection between the split system’s components. Source:

Sunmaster online course. ........................................................................................................... 39

Figure 24: Plastic Tubing. Source: Cable Tie Company. ............................................................. 41

Figure 25: Battery Cables. Source: Sunmaster catalogue. ......................................................... 42

Figure 26: panels interconnection. Source: Sunmaster technical data sheet. .......................... 42

Figure 27: Connector’s Male & Female terminals. Source: Sunmaster technical data sheet. .. 43

Figure 28: the electrical current conversion from DC to AC. Source: Sunmaster technical data

sheet. .......................................................................................................................................... 46

Figure 29: screenshot for a platform of the power tracking. Source: solar electricity handbook.

.................................................................................................................................................... 51

Figure 30: Off-Grid system components and connections. Source: Indiamart website. ........... 52

Figure 31: On-Grid system components and connections. Source: Indiamart website. ........... 53

Figure 32: Hybrid system components and connections. Source: Indiamart website. ............ 54

Figure 33: All in one board. Source: Sunmaster technical data sheet. ...................................... 55

Figure 34: split system components. Source: Sunmaster catalogue. ........................................ 56

Figure 35: conclusion of Sustainergy SWOT analysis. ................................................................ 64

Figure 36: Italwarmi Business Model. ........................................................................................ 74

Figure 37: Trade off the projects regarding project size & the business strength. ................... 75

Figure 38: Salem air force base project’s stakeholders. ............................................................ 78

Figure 39: result from the excel sheet of the initial lighting configuration. Source: Sunmaster

technical department. ................................................................................................................ 79

Figure 40: solar irradiation chart of the project location in Kuwait. Source: solar GIS maps. ... 80

Figure 41: screenshot of Sunmaster configuration software. Source: Sunmaster technical

department. ............................................................................................................................... 81

Figure 42: the Dialux of the Double Arms. Source: Sunmaster technical data sheet. ............... 82

Figure 43: the Dialux of the Single Arms. Source: Sunmaster technical data sheet. ................. 83

Figure 44: the color rendering of the Double Arms. Source: Sunmaster technical data sheet. 84

Figure 45: the color rendering of the Single Arms. Source: Sunmaster technical data sheet. .. 85

Figure 46: road dimensions for the Single Arms. Source: Sunmaster technical department.... 86

Figure 47: road dimensions for the Double Arms. Source: Sunmaster technical department. 86

Figure 48: project wiring diagram for the SSL components. Source: Sunmaster technical

department. ............................................................................................................................... 87

Figure 49: stakeholders of SSL & SPS projects. .......................................................................... 89

Figure 50: SSL & SPS projects tender process. ........................................................................... 90

Figure 51: project management phases. .................................................................................... 91

Figure 52: profit share between Sustainergy & Italwarmi. ........................................................ 94

Figure 53: Startup Process Stages. ............................................................................................. 95

Figure 54: Sustainergy Business Model. ..................................................................................... 96

Figure 55: layout of the parking area. Source: Sunmaster technical department................... 100

Figure 56: layout of the entrance area. Source: Sunmaster technical department. ............... 101

List of Abbreviations

AC: Alternate Current ................................................................................................................. 46

AER: Authority for Electricity Regulation ................................................................................... 16

AGM: Absorbent Glass Mat ........................................................................................................ 32

ARAMCO: Arabia American Oil Company .................................................................................. 75

ASSIL: Associazione Nationale Produttori Illuminazione ........................................................... 26

AWG: American Wire Gauge ...................................................................................................... 42

B2B: Business to Business .......................................................................................................... 24

BAPCO: Bahrain Petroleum Company ........................................................................................ 15

BMC: Business Model Canvas .................................................................................................... 96

CDMA: Code Division Multiple Access ....................................................................................... 45

CFL: Compact Fluorescent Lamp .................................................................................................. 7

CIGS: Copper Indium Gallium Selenide ...................................................................................... 29

CIS: Copper Indium Selenide ...................................................................................................... 29

CRI: Colour Rendering Index ...................................................................................................... 22

CRM: Customer Relationship Management ............................................................................... 65

CSP: Concentrated Solar Power ................................................................................................. 16

DC: Direct Current ...................................................................................................................... 35

DEWA: Dubai Electricity and Water Authority ........................................................................... 15

DSP: Directory System Protocol ................................................................................................. 47

e.g.: Example ................................................................................................................................ 3

EBRD: European Bank for Reconstruction and Development ..................................................... 9

EPC: Engineering, Procurement and Commissioning ................................................................... 1

ESCO: Energy Saving Company ................................................................................................... 75

EU: European Union ..................................................................................................................... 5

EWA: Electricity and Water Authority ........................................................................................ 15

FIT: Feed in Tariff .......................................................................................................................... 9

FLA: Flooded Lead Acid .............................................................................................................. 32

FRP: Fibre Reinforced Polymer ................................................................................................... 36

GCC: Gulf Cooperation Council .................................................................................................... 1

GCF: Green Climate Fund ............................................................................................................. 9

GDP: Gross Domestic Product .................................................................................................... 10

GE: General Electric .................................................................................................................... 73

GHG: Greenhouse Gases .............................................................................................................. 2

GHI: Global Horizontal Irradiation .............................................................................................. 11

GPRS: General Packet Radio Service .......................................................................................... 45

HDG: Hot Dip Galvanised ........................................................................................................... 39

HVAC: Heating, Ventilation and Air Conditioning ........................................................................ 5

IEA: International Energy Agency ................................................................................................. 4

IFC: International Finance Corporation ........................................................................................ 9

IoT: Internet of Things ................................................................................................................ 44

IP: International Protection Standard ........................................................................................ 25

IRENA: International Renewable Energy Agency ....................................................................... 10

IT: Information Technology ........................................................................................................ 44

KISR: Kuwait Institute for Scientific Research ............................................................................ 16

KSA: Kingdom of Saudi Arabia .................................................................................................... 10

LC: Letter of Credit ..................................................................................................................... 94

LED: Light Emitting Diode ............................................................................................................. 3

LIP: Lithium Iron Phosphate ....................................................................................................... 33

M&V: Measurement and Verifications ...................................................................................... 93

MCS: Management Control System ........................................................................................... 43

MERE: Egyptian Ministry of Electricity and Renewable Energy ................................................... 7

MoT: Ministry of Transportation .................................................................................................. 8

MoU: Memorial of Understanding ............................................................................................... 4

MPPT: Maximum Power Point Tracking ..................................................................................... 35

NCA: Nickel Cobalt Aluminum .................................................................................................... 33

NDC: National Determined Contribution ................................................................................... 13

NEEAP: National Energy Efficiency Action Plan ...................................................................... 15

NREA: New and Renewable Energy Authority ............................................................................. 9

O&M: Operating and Maintenance ........................................................................................... 43

OLED: Organic Lighting Emitting Diodes .................................................................................... 19

OPEC: Organisation of the Petroleum Exporting Countries ....................................................... 10

PEST: Political, Economic, Socio-Cultural, Technological ............................................................. 1

PI: Public Institution ................................................................................................................... 88

PLED: Polymer Lighting Emitting Diodes .................................................................................... 19

POD: Points of Difference........................................................................................................... 44

PPA: Power Purchasing Agreement ............................................................................................. 6

PWM: Pulse Width Modulation ................................................................................................. 35

R&D: Research and Development ................................................................................................ 3

RAECO: Rural Areas Electricity Regulation .............................................................................. 16

RAEE: Rifiuti Apparecchiature Elettriche e Ellettroniche ........................................................... 26

REDOX: Reduction Oxidation Reactions ..................................................................................... 31

RFP: Request for Proposal .......................................................................................................... 89

RFQ: Request for Qualification ................................................................................................... 89

SDGs: Sustainable Development Goals ........................................................................................ 5

SME: Small and Medium Enterprises ......................................................................................... 98

SMS: Short Message Service ...................................................................................................... 46

SPS: Solar Power System .............................................................................................................. 1

SWOT: Strength, Weakness, Opportunities, Threats ................................................................... 1

TUV: Technical Inspection Association ....................................................................................... 42

UAE: United Arab Emirates ........................................................................................................ 10

UNFCCC: United Nations Framework Convention on Climate Change ...................................... 13

UNOPS: United Nations Office or Projects Services ................................................................. 104

USA: United State of America .................................................................................................... 10

UV: Ultraviolet ............................................................................................................................ 21

VDC: Direct Current Voltage ....................................................................................................... 42

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Abstract

Nowadays, the global trend indicates that most of the countries are focusing on the adoption

of the energy efficiency technologies to face the challenge of the massive increase on the

electricity demand due to the population growing, also fighting the global climate change and

the lack of clean energy resources. That is why the applications of renewable energy

technologies have a substantial potential portion from the overall market share of the energy

sector worldwide. Based on that, there are highly promising business opportunities for

Italwarmi SRL and Sustainergy incase both enhanced the customers' value propositions by

introducing sustainable PV services and products at competitive prices.

Remark 1: Italwarmi SRL is an Italian trading company founded 1998, the firm has signed a joint

venture agreement with Sunmaster SSL manufacturer which appoint that Italwarmi is taking

the obligation of the business development, creating the market analysis, strategic plan,

business relations, digital marketing and handling all the international sales deals outside Asia

boundaries. Besides, Italwarmi has non-exclusive international sales agency agreements with

Amerisolar, Canadian Solar, Q solar, Trina, BYD and Jinko that gives the company the advantage

of having more alternative suppliers for the solar panels' price varieties.

Remark 2: Sustainergy has not existed before this paper; it is a business model that comes out

from Italwarmi because they have a mutual structure will be shown later in detail. The idea was

started two years ago in 2017, the owners of Itawarmi and Sustainergy have started a

collaboration to enhance the first party's business model to reach growth of sales in the GCC

and Middle East PV market and seize in return 33% profit share from each project. After

achieving success with Italwarmi, the two parties adjusted the agreement states that

Sustainergy is an exclusive agent in Egypt as a first step, then positively assessing the

performance over two years to upgrade an exclusivity agreement in GCC.

This paper is focusing on how to achieve two main objectives. The first one is the sustainable

development of Italwarmi business model to maximise the PV products' growth of sales

worldwide, especially in the GCC region and the Middle East countries. Accordingly, reinvest a

large part of the profit in expanding the company activity to EPC company with professional

capabilities in the designing, engineering, procurement, and commissioning of full-scale PV

projects. The second object is building a startup energy company (Sustainergy) with scalable

characteristics to grow over time through a diversified portfolio to compete in the trading,

engineering and consultancy segments of the energy market in Egypt. Sustainergy’s purpose is

accessing the PV sector, mainly, commencing to operate in the SSL applications as EPC and

gradually seek to implement the small scale of SPS projects in the residential area, then propose

to participate in large scale projects in the commercial and the industrial PV sector.

The starting point is gathering precise data about the circumstances of the energy market in

Egypt and the GCC such as the market structure, energy production and consumption,

renewable energy installation capacities and countries' visions, missions and strategic. Hence,

creating a market analysis including PEST and SWOT studies for the Egyptian market to reduce

the gap of the market uncertainty during taking the strategic decisions and create a competitive

business model because Sustainergy will bear the full financial risk as a new entrant in the

Egyptian market, not Italwarmi.

2 | P a g e

It is imperative also fingering all the available SSL and SPS technologies in the global market

and identifying the best to utilise in the PV applications in term of the economic sufficient and

energy efficient, subsequently recognising the status quo of Sunmatser by accomplishing

benchmarking with other global competitors. Last but not least, promoting the business model

of Italwarmi based on proper business methodologies to be the primary partner of Sustainergy

to enter the Egyptian market with a very highly competitive advantage then promoting the

company activities in the GCC countries.

The summing-up in (table 1) is pointing a part of the development success in numbers,

Italwarmi obtained 238,773.45 USD, and Sustainergy generated 78,796 USD from trading and

technical consultancy activities within six months from launching the strategic plan.

Executive summary

Introduction

In modern time, the world is suffering a scarcity of energy resources challenge and

environmental issues like climate change and the negative impact of GHG emissions; therefore,

all the countries are looking for the best alternatives to overcome these barriers. On the energy

production side, the exploitation of the renewable energy technologies (e.g. PV, Wind,

Hydropower, Biomass) instead of using the traditional resources (e.g. oil, gas, coal, nuclear) is

the best way to generate green energy to heighten the eco-system and diminishing the GHG

emissions. On the energy consumption side, the adoption of the energy efficiency measure is

the most valuable solutions to save energy usage in several sectors at widescale.

Lighting systems are essential technologies in the whole world that better human being life.

They are categorising into indoor and outdoor lighting and being in different sectors industrial,

commercial and residential.

Lighting applications account for 19% of the overall electricity consumption worldwide and

spend around 32 TWh of annual electricity consumption. Result as all the countries begin to

modernise their lighting systems by replacing the traditional one with highly efficient new

lighting technologies, particularly in the outdoor lighting applications (e.g. highways, streets,

tunnels, bridges).

SSL systems are one of the most diffused energy efficiency technologies around the world in

countries having high solar irradiation. The SSL consists of several components such as solar

panel, battery, lamp, cables, controller, mounting structure and pole. All these components

connect to illuminate a specific area by producing electricity from the solar panel during the

daylight and store in the battery to power the lighting lamp when the night.

Project Sunmaster

(R) USD

Italwarmi

(R) USD

Egytalia

(R) USD

Yemen (UN) 3,80,0000 190,000 62,700

Kuwait (Ministry of Defense) 711,104 35,555 11,733

KSA (Royal commerce, Rexel) 264,369 13,218.45 4,363

TOTAL 4,775,473 238,773.45 78,796

Table 1: part of the revenues of Sunmaster, Italwarmi and Egytalia in 2019.

3 | P a g e

Sunmaster is a Chinese family business; They are a manufacturer of various solar products, e.g.

SSL, solar garden lights, small and medium SPS and solar home lighting products. The

production plant based in China on 8,000 square metres with multiple workshops to produce

solar panels, LED lamps, controllers and poles. The production capacity is 500,000 units of SSL

and SPS, the systems' components have all the certifications approving that its products are

meet the international standards; thus, the company export its goods to more than 90

countries around the world. Sunmaster runs its activities following the responsibility

management concept treating ethical and sustainable aspects. The company intends to provide

the customers with lighting facilities having low carbon emissions. According to the statistics,

there are 1.6 Bn of people who live in darkness without lighting and having no access to

electricity.

Sunmaster has developed most demanded products by collaborating with other sister storage

systems manufacturer, and universities in China (e.g. Faudan University) to meet the

customers' needs around the world. The factory has an influential R&D department including

physical, thermology, photology, mechanics, electronics thanks to their collaboration with

Semiconductor Institute of Beijing University and LED Research Center of Zhejiang University.

Aim of the study

The original purpose is advancing Italwarmi business model to achieve growth of sales; further,

the founding of Sustainergy as EPC company with a flexible business model to compete and

generate profits in Egypt and the GCC region PV market through the following current activities:

1. Trading SSL and SPS components by formal agreement with Italwarmi SRL behalf of

Sunmaster, Amerisolar, Canadian Solar, Jinko, Trina, Q Solar and BYD (Solar panels

manufacturers).

2. Introducing technical consultancy in the SSL and SPS design, configuration, installation and

commissioning.

3. Participations for the tenders in Egypt to supply, design, installation of the SSL and SPS

applications. Moreover, submission for the bids in other Middle East countries by building

strategic alliances with lighting, contracting and other EPC companies.

4. Sustainable development of the company business model to cover the other applications

in the PV sector such as solar carports, solar water pumps and solar power plants.

5. Sustainable market analysis to create new business opportunities in the Middle East and

Africa as an expansion for the company activities in the future.

Methodologies

- Cost leadership strategy.

- PESTE analysis.

- SWOT analysis.

- Blue Ocean Strategy.

- Sunmaster benchmarking with global competitors.

- Strategic Alliance.

- Engines of growth.

- Business model canvas.

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1. Chapter one (regulations and market circumstances)

This chapter reviews the status, trends and evolving policy frameworks for renewable energy

in Egypt and the GCC states.

1.1. Circumstances of the energy market in Egypt

The energy sector in Egypt follows the generation mix between renewable technologies and

the traditional one, according to the last statistic of the IEA, in 2015 the electricity production

from renewable energy technologies is approximately 8.2% with 15,030 GWh on the other side,

the electricity production from fossil fuel is 91.8% with 16,694,7 GWh. The surplus amount

1,158 GWh of production is going to export, the energy industry usage is 6,337 GWh, and there

is 20,389 GWh of energy losses due to the fragile energy efficiency measures. This market

structure is started to change regarding the regulatory framework and the future strategic

energy plan, initiatives, objective and the actions toward increasing the adoption of renewable

energy technologies. The total electricity consumption is 15,420,5 GWh divided amid various

sectors, the highest use is related to the residential area with 44%, and more than 50% of the

electricity consumption spends in the industrial, commercial and public services that are

involving the illumination of streets, tunnels, bridges and highways.

1.1.1. Regulations for Energy efficiency in Egypt

Egypt and the European Union have mutual energy challenges concerning the insufficient

energy ratio of production and consumption. Since both need to overcome the barriers of

energy security supply, energy sources diversifications and restructuring the energy market.

The two parties have established a strategic energy partnership called the Euro-Mediterranean

Agreement that signed in Cairo, Egypt, on 23rd April 2018 to improve the energy sector. The

MoU declares a collaboration to figure out common objectives, setting strategic plans and

practical actions to reach their targets.

21%

71%

7%0%1%

Electricity production 2015

Oil 38237 GWh

Gas 128710 GWh

Hydro 13432GWh

PV 253 GWh

Wind 1345 GWh

25%

0%

44%

26%5%

Electricity consumption 2015 Industry 39187

GWh

Transport 601 GWh

Residential 67238GWh

Commercial andpublic service40170 GWhAgriculture 7009GWh

Figure 1: electricity consumption 2015 in Egypt. Source: International Energy Agency.

Figure 2: electricity production 2015 in Egypt. Source: International Energy Agency.

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The following manners are correlating and supporting Italwarmi & Sustainergy main activities

by increasing the market demand onward more diffusion of solar street lighting systems and

solar power systems.

1. Assistance including joint energy measures and renewable energy projects: this

cooperation comprises the financial, the technical and the environmental aspects of the

renewable energy projects approaching the reform of the energy policies and regulatory

framework of the renewable energy technologies. These enrichments will attract more

investor to implement several energy projects in Egypt.

2. Increase the awareness: both parties adopted the idea of supporting the educational

organizations particularly the universities and providing training programs to flourish the

knowledge of the energy status globally, the advantage of the energy efficiency serving the

production and consumption perspectives.

3. SME incentives: they aim to deliver most of the support to the small and medium-sized

enterprises because they do not have energy management systems and have weak

capabilities to manage the energy issues.

4. Energy efficiency strategies and policies: Egypt has a short-term objective within 2018-

2020 and long-term one until 2035 for the energy efficiency saving that should reach for

implementing the national energy strategy.

5. Cross-cutting assets: Egypt and the EU are paying attention to the energy efficiency of the

cross-cutting assets e.g. pumps, compressors, lighting and HVAC. The EU will assist Egypt

throughout institutional strengthening, knowledge transfer, developing the action plans,

developing regulations and implementation of specific energy efficiency projects.

6. Collaboration in the technological, scientific and industrial fields: the advancement of the

energy sector by passing the best available European technology and the best international

practices that can suit with the Egyptian market circumstances to accomplish the energy

efficiency saving within a short period.

The Egyptian renewable energy strategic vision for 2030 is restructuring the energy sector to

match the national sustainable requirements, achieve the United Nations SDGs and maximizing

the efficient use of various resources contributing to the economic growth, competitiveness,

achieving social justice and preserving the environment.

1.1.2. The main objectives of the electricity sector strategy

- Utilisation of the available resources.

- Promoting the utilisation of renewable energy.

- Growing energy efficiency through the Euro-Mediterranean Agreement.

- Environment conservation by adopting advanced measures on the supply side.

- Future planning to satisfy the demand increase.

The target is increasing the electricity production by using 40% of renewable energy until 2030

and 43% until 2035 taking consideration 18% target of energy efficiency measures.

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1.1.3. The Egyptian government role to support renewable energy

- Facilitation of the land allocation and permits, (7,650 Km2 are ready allocated).

- Information availability.

- Long-term PPA.

- Constitutional guarantees and benefits from carbon credits.

- Custom duties are 2%.

- The governorates council has approved to utilise the solar energy streets and public

building lighting.

- The total installed capacity of PV systems is more than 80 Mw for different aims in

different sectors.

- The cabinet has issued a legislative decree to disseminate the use of PV in 1,000

administrative building.

1.1.4. The actions to achieve energy efficiency improvement in Egypt

- Optimising the share of the combined cycle power plants.

- Usage of super-critical steam technology.

- Revamping of traditional thermal power plants to work in the dual firing system.

- Improve power plants efficiency and rehabilitation and renewal of transmission and

distribution networks to reduce fuel consumption and electrical losses.

- Modernisation of the transmission network by conversion into the smart grid.

- Energy conversion measures (Mainly efficient lighting and power factor correction) in

many administrative buildings.

- Labelling and standards program for home appliances.

- Energy efficiency codes for residential, commercial and public lighting.

1.1.5. The environmental impacts regarding actions

- The scheduled electricity generation is around 49 TWh/year by 2023.

- Fossil fuel saving about 9.7 million TOE/year.

- CO2 emission reduction of 25.3 million TCO2/year.

Figure 3: 30/35 vision for electricity production in Egypt. Source: MERE.

2034/2035

Nuclear 10% Natural Gas 17%

Wind 13% CSP 13%

Hydro 6% PV 11%

Coal 30%

2029/30

Nuclear 10% Natural Gas 24%

Wind 16% CSP 11%

Hydro 4% PV 9%

Coal 26%

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One of the MERE actions to implement their strategic energy plan and achieve a 20% reduction

of the GHG emissions is to substitute the traditional lighting technologies such as Sodium

vapour lamps with LEDs. SSL projects almost outfitted in rural areas where is a difficulty to

access to the national electricity grid, the government will assign SSL projects to Contracting or

lighting companies through the participation in bids.

The concept of using SSL technologies is to achieve energy efficiency by incorporating the

production and consumption phases. Thus, the amount of energy using by the LED bulb is

producing from the solar panel as a renewable energy technology. Regarding, the MERE has

started to distribute twelve million CFL indoor lamps and thirteen million LED outdoor bulbs at

half price with eighteen months guarantee to support the energy efficiency.

Remark: there are three types of outdoor lighting projects that Sustainergy performs:

1. Replacement of the traditional bulbs with LEDs.

2. Substitution of the full on-grid lighting with SSL.

3. Implementing SSL project in the new infrastructure (e.g. new residential compounds, new

roads).

1.1.6. Solar Irradiation in Egypt

Egypt has a solar irradiation range 2,000-2,483 KWh/m2/year thanks to the geographical

location and sunshine duration 9-11 hr/day that gives potential productivity more than 50,000

Mw produced power. As noted in the solar resource map, Egypt characterised by high average

daily irradiation rate and relatively high frequency of bright days. In Cairo, there is a low average

daily irradiation rate and frequency of the sunny days due to the urbanisation and the high

pollution. Southern Egypt has higher solar irradiation than the north resulting that most of the

new solar projects will take place in upper Egypt.

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1.1.7. Increasing the potential SSL applications in Egypt

The Egyptian road network has consisted of 23,619 kilometres of roads divided into 6,715,303

of single roads, 3,920 kilometres of double roads and 476 kilometres of highways. The strategic

plan of the ministry of transportation to upgrade the national road network, they are working

on the enlargement of the highways roads to expedite the interconnection between the

Egyptian provinces.

The MoT estimated 8 $ billion investments to execute expansion road projects over the next

five years. The strategic plan involves series of new roads alike Ras Sudr-Sharm El Sheikh road

with 71 $ million as an initial investment, Safaga-El Quseir-Marsa Alam road with 85 $ million

investment and a road from Alexandria in the North-West of the Nile to Abu Simbel by setting

640 $ million investment besides the development of the bridges and tunnels. These

improvements will lead to tremendous progress and drive economic growth in several sectors

(e.g. residential sectors to face the high population increasing, commercial and industrial

sector). The link here is that all the new roads infrastructure projects will utilise the SSL as

Figure 4: the solar irradiation map of Egypt. Source: Global Solar Atlas.

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South and

Eurasia

Africa

10%

Global total: 193.5 trillion cubic metres

illumination technology to avoid the cost of cabling connection between the lighting points and

the national grid.

Further international assistance to the

energy sector in Egypt is that the EBRD

is assisting the Egyptian government by

signing an official agreement with the

NREA to implement the FIT program

through funding more than one billion

dollars in cooperation with the GCF.

Moreover, a cluster of ten banks

including the IFC, the private

investment arm of the World Bank has

invested 653 $ million in accomplishing

13 of the 32 solar plant projects at

(Benban) one of the world largest

photovoltaic park with 750 Mw PV

installation capacity for 37.5 Km2 installation area in upper Egypt allocated by NREA.

In 2017, the installation capacity of the renewable energy technologies was 45,192 Mw, and

the maximum load was 30,800 Mw; accordingly, 32.8 million consumers are used 1,950 Kwh as

electricity consumption.

1.2. Circumstances of the energy market in the GCC countries

The two figures are pointing out the production share of the GCC and the Middle East countries

comparing to the rest of the world in 2017.

Figure 6: global share of Oil & Gas production. Source: petroleum study and research centre of KSA.

18%

Middle East

19%

Central America

Global total: 1,696 thousand billion barrels

Figure 5: BenBan solar sark project in Aswan, Egypt. Source: Forbes Middle East.

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Concluding that the economy of the GCC countries is stable and sustainable in many years, the

key driver of the GCC economic growth is the accessibility to the enormous oil and gas

resources. Most of these countries are wealthy because of the small number of population and

the massive oil and gas reserves. KSA and UAE are the two largest economies in the GCC cluster,

with two-thirds of the total GDP. Based on the IRENA statistics in 2018, KSA has reached 47%,

and UAE has achieved 26%, followed by Qatar and Kuwait by 11% and 9%. KSA is considered

the highest oil producer after the USA and Qatar is the 4th largest gas producer.

Within the last ten years in the Middle East, there were radical changes in the political and

economic regimes. The Arabian spring revolutions since 2011 affected the energy market

structure.

From the economic point of view, the energy market structure dramatically changed

concerning the peak in the oil price in 2011 and the increase in the inflation rate. Further, the

Oil price is extremely volatile, but it is almost inelastic to the demand because the consumption

is not reducing in a short time. For this reason, OPEC always keeps its price below a certain

threshold, which would make better to switch to another energy source. Hence, to change it,

there is a necessity to change the price offer, and which is currently the OPEC objective.

Accordingly, the GCC countries realized that the future is toward the renewable energy after

the significant drop in the oil & gas prices which are the main income resource for most of the

GCC countries (KSA, UAE, Qatar, Kuwait, Bahrain, and Oman). In this region from an economic

perspective, the transition from fossil fuel to renewable is inevitable. The countries started to

set strategic plans through building internal strategic alliances between the Middle Eastern

countries, then, signed memorial of understanding with the European Commission, USA, and

the Far East countries who have the renewable energy technologies.

Remark: There are two main factors support GCC countries strategies.

1. The huge financial resources from the oil & Gas, as explained before.

2. The significant amount of solar irradiation as the fuel of solar power applications.

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1.2.1. Solar Irradiation in GCC

Generally, the average solar irradiation amount is GCC countries is as good as those in the other

countries of the Middle East and North Africa. According to the GHI map, the GCC countries

have abundant solar resources as shown in the figure, particularly in the North-Western and

central regions of Saudi Arabia and the southwestern region of Oman can generate 2,289

kWh/m2/yr, even Bahrain, Kuwait, Qatar and UAE have a useful annual average of the solar

irradiation.

Nowadays, there is a peak up in the national plans, targets, and strategies to adopt renewable

energy technologies in the GCC. Alongside energy efficiency, renewables play an essential role

in regional efforts to conserve natural resources and diversify the energy mix, which remains

heavily dominated by fossil fuels. Renewables also have the potential to generate valuable jobs,

innovate and knowledge-based economies. The relatively low oil prices that have prevailed

since 2014 have had little effect on regional renewable energy plans which have pushed down

prices for solar PV and other renewable technologies to levels that are competitive with oil and

natural gas.

Figure 7: solar Irradiation map in the GCC region. Source: International Renewable Energy.

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1.2.2. GCC countries’ targets toward energy efficiency & renewable energy

The GCC countries start to set objectives to face the challenges of the new energy market

circumstances. The following illustration summarizes the set of targets which are in the

implementation phase now.

Figure 8: renewable energy targets in the GCC countries. Source: International Renewable Energy Agency.

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The UAE has taken the first move toward setting the legislation for the energy efficiency

targets, pushing the other countries to engage with the sustainable energy targets under the

UNFCCC regulations, which became later a national trend for each member in the GCC and the

Middle East. Those targets gradually translated into policies and projects based on each country

GDP and the energy demand and supply in their market.

By 2030, KSA vision is to reduce 130 million tons of CO2 emissions by launching investment

programs in energy efficiency, including production and consumption perspectives. Moreover,

the adoption of energy efficiency measures to develop the water and wastewater management

and reduction in gas flaring from the oil & gas sector.

In 2016, UAE signed the Paris agreement for energy efficiency measurements. They decided to

approach the strategy of economic diversification that will yield mitigation and adaptation co-

benefits. Thanks to this strategy, they increase the share of the clean energy in the national

generation mix up to 24% by 2021. The ministry of climate change and environment initiated

“the national climate change plan of the UAE” to clarify the country strategy to reduce 40% of

the energy consumption in 2050.

The NDC in Bahrain relies on the energy efficiency in building, industrial sector and transport

and the energy sector but the small scale of renewable projects because the country is

geographically small, and the demand of the electricity is not too high. In 2018, the renewable

installation capacity included only 5 Mw On-grid solar PV plant operated by the ministry of

electricity.

By 2030, Kuwait has approved the reduction of the GHG emissions by releasing the regulations

to increase the renewable installation capacity and reform the prices of the petroleum

products. Additionally, launching less fuel intensive transport systems, including a metro and

railway project. The Kuwaiti Parliament legalized the environment protection law to promote

energy efficiency and clean energy.

Oman’s NDC calls for urgent energy measures policies state to boost the energy efficiency

technologies in different sectors such as transportation, electricity generation mix and

supporting the energy efficiency of the sustainable buildings.

KSA UAE Bahrain Kuwait Oman Qatar

Renewables

installation capacity

(2018)

142 MW 589 MW 6 MW 79 MW 8 MW 43 MW

Renewables share in

the total power

capacity (2018)

0.2 %

2 %

0.1 %

0.4 %

0.1 %

0.4 %

Future installation

capacity by (2022) 700 MW 3.14 GW 100 MW 1200 MW 2.8 GW 350 MW

Table 2: current and futuristic installation capacity of the renewables in the GCC.

Source: Middle East Electricity’s report.

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The national 2030 vision in Qatar pursues climate change solutions and aims the balance

between national electricity consumption and environment protection. Thus, the energy

legislation institution in Qatar has committed to promoting energy efficiency, clean and

renewable energy, education, and R&D to develop the infrastructure and the transportation

sector.

1.2.3. GCC countries plans and strategies toward renewable energy

After the clarification of the energy market resources, circumstances and the targets of the GCC

countries, it is the turn to identify the accelerations to approach these targets. The

accelerations here are policies and legislation that each country issues as guidelines to assure

the strategic plans and the road maps until reaching the energy efficiency objectives. Most of

the policies are common, but still, each country has specific priorities to achieve their vision.

1.2.4. Kingdom of Saudi Arabia

The public institution in KSA set a dedicated regulation as incentives to attract investments in

energy efficiency solutions. The first effective action is the government merged the ministry of

oil, and the ministry of electricity under one responsible organisation called the ministry of

energy.

Renewable energy plans and strategies

In 2016, the ministry of energy approved the national energy program aims to release several

renewable projects through regulated auctions. The 1st round was in October 2017, with the

issuance plans for one solar project and one wind project. There are several rounds to be

released by 2020. Moreover, the electricity and cogeneration regulatory authority approved

the net metering scheme for residential PV in 2017.

KSA has started the collaboration with Egypt and Jordan around the 2030 vision; the main

objective is building a new large business zone called Neom near the Red Sea and the Gulf of

Aqaba. The energy accelerator of Neom is renewable energy as a green city on 26,500 squares,

and the KSA Crown prince dedicated 500 billion USD as public and private investments.

1.2.5. United Arab Emirates

The energy market in UAE is the second largest one in the GCC after KSA energy market. The

public institution futuristic vision is toward enhancing the educational system and the

considerable investment in the research and development, the UAE considered as the leader

of the renewable energy applications in the GCC region, and they are also the largest and

fastest growing solar market. UAE has started by reducing the dependence on the oil & gas

sector as a main source of the national power generation and compensate the reduction by

releasing auctions that awarded more than 2 Gw of solar projects in the last years, considering

the PV technology has the largest share of 83% from 589 Mw renewable energy installed

projects.

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In 2018, during the world government summit in Dubai, UAE announced to create the

sustainable development goals centre for the Arab Region. Besides the government institution

has launched several renewable energy strategies to reach the SDGs that included in the plans

of UAE Vision 2021, UAE Green Growth Strategy, UAE Future Energy Strategy 2050 and the UAE

Centennial Plan 2017 that ensured the country unified energy strategy as a law, an additional

focusing on the economic diversification, knowledge creation and technology innovation. The

strategies aim to increase the share of the renewable energy in the national electricity

generation mix to 50% by 2050, and the country has reachable short to medium term targets

to generate 27% of the energy from clean resources by 2021; also, this percentage will increase

by 15% by 2030.

The DEWA and Expo 2020 have signed an MoU aiming to have 50% of Expo power supply from

diversified renewable energy sources. The MoU included a pilot project considered as the first

solar driven hydrogen electrolysis facility in the GCC region.

1.2.6. Bahrain

Currently, Bahrain has a boosting in the population growth and industrial development, so the

power demand has increased gradually. The energy power generation almost depends on fossil

fuel. On the other hand, the country is the minor producer of crude oil among the GCC

countries.

The diversification of the electric power generation by adopting renewable energy technologies

is a necessity because of the new energy market circumstances.


In 2017, Bahrain signed the Paris agreement for the climate change, based on that the

Kingdom economic plan vision to 2030 is approaching the SDGs and following the

Renewable Energy Framework of the League of Arab states. These approaches pool

together under NEEAP with obvious renewable energy production targets of 5% by 2025,

10% by 2035 and the efficiency of energy consumption target 6% by 2025. Its aims for

efficiency improvements in both energy supply and demand through 22 initiatives across

all economic sectors.

Regulatory framework and policy instruments

BAPCO is responsible for the project management of Bahrain PV park with 100 Mw of

installation capacity the commissioning stage of the project will finalise in 2019. Most of the

renewable energy projects will get funds from public and private investments. In 2018, the EWA

announced USD 720 million projects as an extension of the Bahrain PV park under competitive

bidding supervision from NEEAP. In early 2018, EWA announced a USD 17.18 million

investment in developing the Al Dur PV power plant and the Al Dur Wind Farm, with installed

capacities of 3 Mw and 2 Mw. BAPCO will further provide USD 25 million investment in 5 Mw

distributed power plant to supply electricity to the BAPCO town of Awali.

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1.2.7. Kuwait

The government in Kuwait has decided to support the renewable energy resources and

diversify the sources of the national electricity generation, exploiting only the oil production

for export to sustain the national economic progress. The government feasibility analysis for

the renewable energy projects assures the savings up to USD 750 million by 2030 comparing to

the adoption of the traditional technologies in the electricity generation.


The energy vision is depending on 10% renewable energy by 2020 and 15% by 2030

contribution with an installation capacity of 5.7 Gw CSP, 4.6 Gw solar PV and 0.7 Gw wind.

The installation capacity divided into small, medium and large-scale projects.

KISR in Kuwait is responsible for the development of renewable projects such as 10 Mw of solar

PV capacity in Shagaya city, 10 Mw of wind and 50 Mw of CSP. The same organisation is

responsible for the 2nd phase of a solar power project in Shagaya with 1.5 Gw installation

capacity funding by Kuwait National Petroleum Company around 1.2 billion USD, and it is

expected to start the operation by 2022.

1.2.8. Oman

Comparing Oman’s oil & gas reserves with the other GCC, Oman has the smallest amount of

the hydrocarbon resources, hence they still fighting to access renewable technologies.

According to AER, they have one of the world’s highest solar energy densities and excellent

potential for wind technology due to the geographical position and the mountain typology of

their lands. Like its neighbours, the Supreme Council for Planning in Oman has started a

diversification-based economy strategy on the non-oil revenue.


In 2015, the Public Authority for Electricity and water had started the national energy

strategy to 2040. The vision is to reach 10% of the generation mix from renewable energy

sources such as solar power and wind by 2025. The authority announced the first bid in

2017 for 500 Mw solar project encouraged by bank loans support and incentives from the

government plus a new bid for the 100 Mw solar plant awarded in November 2018.

The RAECO has released a short-term energy strategy for renewable installation capacity

of 90 Mw by 2020. In 2016, Oman had expansion from 2 Mw of the solar installation

capacity to 8 Mw in 2017.

The government committed a regulatory framework developed by AER, including FIT

incentives to motivate the distribution companies to aggregate the residential rooftops

and to auction their building surface for solar PV development. The AER identifies qualified

residential buildings and invites the qualified customers to join the pool, followed by a

tender for private investors to install the solar system on each building.

The AER sets minimum technical standards and a FIT rooftop PV that gain the benefits of

2 billion m3 of gas saving over 25 years with a monetary value of 1 billion USD and Co2

17 | P a g e

emission reduction of 3.2 million tons over 25 years. Further benefits, the reduction of the

average yearly electricity bills for the customer about 42% and decrease the needed

investments for electricity networks and generation capacity.

1.2.9. Qatar

The government has started to balance between natural gas and renewable energy sources in

the national power generation. They decided to exploit the profit from exporting natural gas

as financial resources to fund renewable energy projects.


Qatar set national strategic plans, the first one is a long-term vision for 2030, and the second

one is shorter to be reached by 2022. since the country will host the 2022 world cup, the

ministry of energy and Industry aims at increasing the installation capacity of the solar power

up to 500 Mw by 2020 and announced a target of 10 Gw of solar power by 2030.

Regarding the strategic energy plan of 2022, Qatar General Electricity and Water Corporation

released a cooling system project for the world cup stadiums. They will power the cooling

system by 3500 Mw of solar power Installed capacity. They announced that the world cup

would be taking place in November and December of 2022 in order to reduce the tournament

cooling demand.

Regulatory framework and policy instrument

A collaboration between the General Electricity Corporation and Qatar petroleum has started

to initiate a prequalification of bidders for 500 Mw solar tender as the first stage by 2020.

Furthermore, these entities made a 500 USD joint venture with Siraj Power to reach

developments in the solar power plan sector.

1.2.10. Conclusion from the GCC market analysis

The energy resources, market circumstances, targets and the strategic plans in the GCC affirms

that there is a mega trend toward the transition from the traditional energy resources toward

renewable, particularly, the PV technology. That is creating new business opportunities in this

region. Italwarmi and Sustainergy reconsidered priorities of which country to focus on avoiding

wasting efforts and the distortion of the companies’ resources and capabilities. Therefore,

Italwarmi has decided to sign exclusive agreements with local companies in the GCC, which are

geographically small like (Oman, Kuwait, Qatar and Bahrain). The contracts declare Italwarmi

to supply Sunmaster’s products only to the second party and restricted selling to any third party

in the specified marketplace, on the other hand, the latter party have to reach pre-agreed

minimum quantity per year; besides, forbidden buying SSL products from a company other than

Italwarmi. Penalty terms impose on the party who causes any deviation from the exclusive

agreement terms. By now Italwarmi signed two exclusive contracts with Bait Al-Aseel in Kuwait

and Green Wave in Qatar that will generate at least per year 2 $ millions of revenues to

Sunmaster, 100,000 $ to Italwarmi and 33,000 $ for Sustainergy; further, there are two others

under negotiation with two companies in Oman and Bahrain. However, it is distinct dealing

18 | P a g e

with the market in KSA and UAE. Both have larger geographical areas and higher competitive

market than others; hence, Italwarmi considered to perform an in-depth market analysis for

the two countries to exploit the opportunities as much as possible. Briefly, the agreements

strategy in the GCC is to sign exclusive contact in (Oman, Qatar, Bahrain, Kuwait) that will

generate consistent profit over three years and focuses all the substantial operating efforts on

UAE and KSA.

2. Chapter two (technologies)

The technical methodology

The concept of the PV system is generating the electricity when the solar panels exposed to the

sun rays during the daytime, then storing the electricity in a rechargeable battery backup to

utilise during the night.

Technologies of solar streetlights

Here in this chapter, the study of SSL & SPS components’ technical parameters. SSL is an

integrated system involving different technologies which are commodity products using in

several industrial sectors such as solar panels, LED lamps, batteries, cables, controllers, battery

boxes, mounting structures, poles, motion sensors and smart control systems.

Each element of the SSL system has distinct specifications; therefore, the choice of a suitable

device concerns the site inspection, the design and the system configuration. Most of these

technologies enhanced in terms of boosting the efficiency, lifespan and decreasing the prices

through the R&D departments by the time.

2.1. The lighting lamps

The lighting source is one of the vital electrical devices in SSL. From the consumption

perspective, the type of lighting lamp impacts the energy efficiency of the system. Hence, the

identifications of the commonly used lighting technologies and the comparison between them

are essential to convince the customers with LED as the most efficient technology.

There are four lighting technologies:

- Incandescent lighting.

- Gas discharge & induction lighting.

- Solid state lighting.

- Laser lighting.

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2.1.1. Incandescent Lighting

Thomas Edison invented the eldest lighting

technology in 1878. About this technology, the

electric current flows through the Tungsten filament

emitting the lighting and heat. The filament reaches

high operating temperature and transmits light over

a wide range of wavelengths. Through the operating

temperature, the colour of the light usually differs

from warm yellow to white.

The incandescent lamps release around 98% of the

input electric current as heat rather than visible light.

Incandescent lamps have flexible dimming

advantage and can be easily controlled

but are limited in terms of a lifetime because of the

fragility and the high stress of the filament and the fixture glass. The main benefit of the

incandescent is the reasonable price, high performance and the easiness of the installation.

2.1.2. Solid-State Lighting

The title solid-state refers commonly to the light emitted by electroluminescence. There are

three types of light-emitting diodes used in the lighting systems and mostly different from the

incandescent technology or fluorescent one in a sense that they convert most of the energy in

visible lights rather than heat.

LED technology developed at the beginning of 1900. Within ’90s researchers start to improve

the LED technology to reach high energy efficiency and a wide range of colours; thus, the LED

technology turned to be quality and price competitive technology for indoor and outdoor

lighting.

There are three types of the solid-state lighting technologies:

- LED.

- OLED.

- PLED.

The LED lamp consists of a chip and a driver:

• The chip carries two elements of the treated

material called P-type and N-type

semiconductors that can generate photons

through a process of spontaneous emission.

They are placed in direct contact, forming a

region called the P-N junction, that has a

transparent package, allowing lighting rays to

pass through.

Figure 9: Incandescent Lamp. Source: Phillips catalogue.

Figure 10: LED Lamp configuration. Source: Sunmaster online course.

20 | P a g e

• The driver optimises the power required for the LED chip and fixed inside the luminaire.

Nowadays, LED technology is one of the most diffused lighting technologies in the market

thanks to several advantages, e.g. long life, durability, design flexibility, low price, and

energy efficiency.

OLED

OLED is manufacturing by using organic materials. This technology is still under development,

but available with a coloured range based on the molecular thin film. OLED has beneficial

attributes such as low price and high performance compared with the other solid-state lighting

technologies. Only LED within the solid-state lighting technologies is considered as the highest

competitive technology with OLED in the current market.

The R&D departments of several lighting companies are working on the OLED improvement in

order to raise the product potentiality and prove the applicability of using OLED technology in

outdoor applications.

PLED

In this type, polymers are used as a manufacturing raw material to produce electroluminescent

conductive emitting diodes.

PLED is an energy efficient; but it is in the pre-commercialization phase and still under

development to be economically efficient and competitive with the most diffused outdoor

lighting technology LED. PLED designed as a thin film display with specifications of high

brightness, full-spectrum, and low drives voltage, though the enhancement of the PLED

technology strictly linked with the OLED technology because of the similarity of the

functionality principle.

2.1.3. Gas Discharge Lighting

Recently, gas discharge lighting was adopting as neon lighting technology for the indoor lighting

applications, and after a particular development, by adding some substance like Sodium, metal

halides and mercury, it is involved in the outdoor lighting. Each of these materials presents

different specifications related to prices, energy efficiency, performance, lifetime and light

colour. The gas-discharge lamps provide the light when the electric current passes through an

ionised gas.

Electrode

Glass Bulb

Lead Wire

Plasma

Figure 11: diagram of Gas Discharge Lighting.

21 | P a g e

There are different types of discharge lamps representing the following:

• Low-pressure sodium lamp: it is the most efficient type of gas-discharge lamps that work in

an operating pressure lower than the atmospheric one. They are the most efficient gas-

discharge lamp type. Since it generates a monochromatic yellow light, it is using in only

specific applications.

• High-pressure sodium lamp: this technology has the same functionality as the low-pressure

sodium lamp. It has a high working pressure which specifies high performance but low

energy efficiency.

• Fluorescent lamp: mercury is the primary raw material in this lamp. The electric current

passes through the mercury to excite and produces UV light to be absorbed by a phosphorus

coating inside the lamp that produces the visible light.

• Compact Fluorescent lamp: this type has the same manufacturing material of the traditional

fluorescent. The companies developed it to overcome the design defects of the fluorescent

one and make it fit the outdoor lighting systems. The compact bulb specified with higher

energy efficiency but a higher price than the conventional one.

• Mercury Vapor lamp: the functionality is the same as the previous lighting technologies

once the electric current passes into the vaporised mercury, the light comes out. It is more

efficient, and longer lifetime than the fluorescent technologies, on the other hand, it has a

high intensity of white light that decreases the competitive chances in the outdoor lighting

market.

• Metal Halide lamp: the manufacturing of metal halide lamp involves a mixture of halide and

vaporised mercury. Accordingly, this lamp is more advanced technology than the mercury

vapour in term of energy efficiency and design.

• Induction Lighting: recently, the induction lamp had a low diffusion in the market lighting

until 1970 when General Electric and Philips acquired their patents. The R&D departments

upgraded the induction technology in order to increase the efficiency and make the design

applicable in the outdoor lighting systems that made the technology became more diffused

technology and spread at a wide scale.

Mercury

Electromagnet

Fluorescentpowder

Frequencegenerator

Figure 12: diagram of the Induction Lighting.

22 | P a g e

Induction Lamp technology involves several chemical components (e.g. mercury, argon and

krypton). The light generates by using an electromagnetic field to excite the chemical

substances, then, creates UV rays inside the bulb that release the visible light. The working

principle and the structure of the induction lighting is similar to the fluorescent lamp, but it

does not have an electrode in the tube.

The induction lighting lamp requires three components indicated in the above-mentioned

image:

- Frequency generator.

- Electromagnet.

- Discharge tube.

Firstly, the generator creates a high-frequency current that passes in the electromagnet

generating an electric field. Then, the induction process starts by exciting the mercury and

forms visible light. This technology has the advantages of a long lifetime and high efficiency

compared to fluorescent technologies.

2.1.4. Comparison between lighting technologies

In this part, the review of an accurate analysis and precise comparison between all the previous

lighting technologies to identify the best available one, denoting out the economic and

technical characteristics. This comparison is in terms of the performance, energy efficiency,

costs and lifetime.

The technical parameters to evaluate the performance of each lighting technology

• Lifetime: is the parameter that describes the interval time from the first operation of the

lighting technology until discarded, estimating in hours unit.

• Luminous efficiency (lm/W): it identifies the efficiency of lighting technology. It is related

to the amount of light emitted from the light source, independent of the effect of the

luminaire and any optical control. Luminous efficiency is measured as the ratio of luminous

flux to wattage power.

• Colour temperature (K): this parameter refers to how warm or cold the light appears. It has

a unit measure in degrees Kelvin (K), the higher the value, the cooler the light. Commonly in

street lighting are using 6,000K cool white lights, but in some urban area are requesting

warm white at 2,700K.

• CRI: it describes how well a white light source performs in accurately displaying the colours.

It gives the ability of the artificial light source to reveal the colours of various objects

regularly in comparison with the natural light source. The higher is the value, the more the

light is similar to the natural one. Natural light has a CRI of 100.

• Dimming control: it refers to the flexibility of the optimisation of the lamp lighting power

and the related variation of luminous flux.

23 | P a g e

Parametrical comparison

In the table a statistical comparison between all the parameters of available lighting

technologies.

Light

Technology

Lifetime

(hr) CRI

Color

Temperature

(K)

Luminous

efficacy

(lm/w)

Start time

(min)

Dimming

control

Incandescent 1,000-

5,000 100 2,800 11-15 Immediately Excellent

Low-Pressure

Sodium

10,000-

18,000 0 1,800 100-180 Up to 15 No

High-Pressure

Sodium

12,000-

30,000 25 2,000 60-130 Up to 15 Very low

Fluorescent 10,000-

20,000 70-90 2,700-6,200 50-100 Up to 5 Good

Compact

Fluorescent

8,000-

20,000 85 2,700-6,200 40-72 Up to 5

Mercury Vapor 12,000-

24,000 15-55 4,000 40-60 Up to 5 No

Metal Halide 6,000-

20,000 65-95 3,000-4,300 70-110 Up to 15 Very low

Induction 60,000-

100,000 85 2,,700-6500 62-95 Up to 5 Good

LED 5,0000-

100,000 85-90 32,00-6,400 70-160 Immediately Excellent

As a summing-up, the LED lighting technology is considered the best available solution among

all the traditional ones in terms of the performance, energy efficiency, lifetime and cost. From

the market feedback, most of the purchasing requests are to the LED lamps, and all the

competitors are focusing on manufacturing LED with different wattage range and exploit their

R&D departments to enhance the quality besides reducing the production cost to keep the

sustainability.

Comparing this technology with the other available electric-based lighting technologies, it

appears evident as LED reaches better performance results in artificial and outdoor lighting

applications.

Additionally, the competitive traditional lighting technologies are the low-pressure sodium

lamps, but unlike LED, their low flexibility of dimming light lessens their competition

potentiality in the outdoor lighting applications, further assurance based on lighting researches

Table 3: Comparison between the lighting technologies, the data are extracted from the following sources: Lighting technologies comparison. http://www.gigavision.com.au/study-centre/lighting-technology-comparison , Studying material of Economic Assessment for Energy Efficiency Solutions in industrial buildings. Prof. Giovanni Toletti, 2017, Catalogue from the technical department in SunMaster and Isolar. China.

http://www.gigavision.com.au/study-centre/lighting-technology-comparison


24 | P a g e

in Italy will be reviewed next topic, all the energy efficient lighting projects related to the

substitution of the traditional lighting technologies with LED lights.

Cost

The LED lighting market is roughly competitive due to the demand increase, and the price

depends on several factors, for instance, the production technologies, labour market and

acquisition of the raw materials, therefore the leading manufacturers in the lighting market

exert a lot of efforts and investments to sustain the price ware and gain a competitive

advantage. In the Chinese market, the price of bulk orders is lower than the medium and low

quantity orders, and mainly most of the manufactures deal as B2B. There are expectations refer

to the reduction of the LED lamps prices in the upcoming years.

Energy efficiency

The notion of the paper based on the energy efficiency methodology, it is one of the main

drivers to support the growth of the LED lamps market, because LEDs can provide a high light

intensity by consuming less electricity than the traditional one. The reason for this low energy

consumption associated with the fact that the light emitting diode technology transforms most

of the electric power into visible light rather than heat. Less than 10 % of the power used by

incandescent lamps is converted into light because a large amount of power converts into heat.

Remark: Sunmaster has licences to use the chip of Philips, Cree and BridgeLux.

Control An advantage is an easiness in controlling the dimming of LED lamps without a negative effect

on the lifetime or the performance. The LED lamps have high flexibility in the dimming mode

of the management control system compared with the other traditional technologies.

Sunmaster LED lights can work for 12 hours at full power (100%) or with dimming mode 100%

for 4 hours + 60% for 2 hours + 30% for 6 hours. While most of the fluorescent lamps can reach

only about 30% of full brightness and characterise by a step-level dimming. For this feature,

LEDs are the preferred technology in the SSL projects that usually involve smart control and

dimming systems. Furthermore, traditional light sources tend to have a shorter lifespan during

the more they are dimmed on and off, whereas LEDs are unaffected by rapid cycling. In addition

to flashing light displays, this capability makes LEDs suitable for the lighting integrated system

All-in-one, including the motion sensors.

Remark: All-In-One is an integrated lighting system that Sunmaster introduces with different

ranges of wattage power.

Lifetime

The LED long lifespan reduces maintenance cost and long-term operating cost contrasted to

the standard lighting technologies. The lifespan is the average length of working life of a

material object uses in specific operating conditions. The junction temperature influences the

lifespan because the LED chips are susceptible to the temperature; the LED chip with low

quality heat dissipation has a shorter lifespan.

25 | P a g e

Another feature, the High-quality housing of the LED lamps in the SSL application, is an essential

factor in enhancing the lifetime during the operating hours. Also, avoiding the exposure of the

lamp to the dirt and the rain increase the lifetime. Therefore, it is necessary that the street light

LED lamp has an IP65 that enable it to work in the dusty and rainy environment.

Remark: the IP is a protection measurement of the LED will have against solid objects such as

dust, sand, dirt and liquids.

Among the traditional technologies, only the induction lamps can reach a competitive level

with LED lifetime, but they are not energy efficient. The LED bulbs to last ten times more than

the compact fluorescent bulbs and around 100 times longer than typical incandescent bulbs.

This advantage facilitates the operating and maintenance plan because, in the worst-case

maintenance scenario, LEDs continue operating but with a low output that makes the operators

avoid urgent intervention.

Beam angles according to IESNA standard

Each lighting source has a beam angle that refers to the directionality of the generated light

rays; the beam angle is the measurement of lighting distribution. The traditional lighting

technology has a wide beam angle that can reach 360 degrees as the light spreads to all the

way directions but with less intensity.

The LED lighting technology can optimise the beam angle concerning the project requirements

and makes the lighting distribution on a focal point to illuminate a specific area and avoid the

lighting distortion. It is possible to reach that by applying special lenses over the led chip that

changes the standard flux of light.

The optimisation of the beam angle is a crucial determinant in the SSL applications to identify

the distance between each pole on the roadsides. Practically, it requires a wide beam angle in

some projects of the SSL alongside the road and narrow one regarding the width of the road.

Therefore, the flexibility to regulate the beam increase the efficiency of the system.

Figure 13: typical life of standard lighting technologies. Source: the elusive “life” of LEDs: How TM-21 contributes to the solution. LEDs Magazine, November 2011.

26 | P a g e

2.1.5. Smart Lighting projects in Italy (European reference)

This topic aims to end the doubts about the benefits from the execution of the SSL and raise

the sustainable advantages, addressing the economic, social and environmental features.

Considering the flow of the technologies starts from Europe and America to reach the Middle

East and Africa; it is important to note these advantages to the customers and show them the

benefits come out from practical projects have successfully implemented in the European

countries as a reference.

As a result from the statistics and reports of the Italian association of lighting manufacturers

(ASSIL), there are 1,308 smart city’s projects in 158 different municipalities with total

investment 3.7 billion Euro, among these projects at least 46 are related to the smart street

lighting in which the substitution of the traditional lighting technologies with the LED lighting

technologies.

Bergamo

Bergamo city started a Smart City lighting project for increasing energy efficiency, reducing

general costs and obtaining more eco-sustainability and safety. The project established by

replacing more than 15,000 of traditional lamps with LED lamps.

Thanks to the efficiency of smart lighting systems technology, the city achieved 50% of energy

saving and 3.15 million euros over nine years.

Bergamo diminished the electricity consumption from 8.8 million kWh to 5 million kWh yearly

in addition to obtaining many advantages in terms of energy efficiency, safety, light quality,

and sustainability.

With the new LED lighting solutions, Bergamo city avoids replacing 5,000 lamps every year

besides the smart control system the city has the chance to check the lighting system for all the

time, being informed about any possible damage in real time. Bergamo releases 1,600 fewer

tons of CO2, 900 tons of oil equivalent and 0.7 tons of RAEE.

Brescia

Ago, Brescia has utilised the smart lighting systems by accomplishing an energy savings project

and substituting all the traditional lamps in public lighting with LED lights. They replaced more

than 16,000 luminaires. According to these improvements, the Commune anticipates a 40%

drop in energy consumption. That led to financial saving up to 8 million euros within ten years

and a reduction in the maintenance cost due to the long-life cycle of the LED bulbs. The impact

on the environment is favourable, causing a cut of more than 1.5 tons per year of RAEE, the

replacement of the traditional lamps removed any mercury traces regarding the reference

standards. On the social level, the design of the lighting system has guaranteed better lighting

for citizens’ safety.

Montecchio Emilia

In 2013, The municipality of Montecchio Emilia had decided to implement an innovative public

lighting system to follow the trend of smart cities and adopting smart street lighting services.

The project was built to replace more than 2,300 lighting fixtures with a capacity of 303,773

27 | P a g e

kW having a massive consumption of 1.6 million kWh, by inserting management control system

in ten lighting poles to control four security cameras and nine hotspot access points to activate

the WI-FI service for the public users in Montecchio historical centre.

Beneficial from the smart street lighting and services, the power consumption deducted from

303,773 kW to 150,000 kW approximately saving one million kWh as a more than 55% of energy

savings.

Turin

Municipality to realise significant cost reductions and 60% of energy savings. By following the

Horizon 2020 European projects and the indications of the European Commission energy

targets, Turin has turned into a smart city.

Turin has represented a prestigious project for resolving the main problems in terms of energy,

environment, and mobility. The goal was to launch a new model of development, which is both

socially and economically credible and has effective results. Turin is officially a greener city;

Nowadays, it saves 10,700 fewer tons of Co2 and 4,000 tons of oil equivalent. The smart lighting

systems allowed Turin to reduce the average of every single luminaire from 150W to 75W.

28 | P a g e

Acknowledging the previous results of the projects in Italy, it confirms that LED requires less

power than traditional lighting technologies, rising the energy savings, notably for street

lighting systems in which the lighting lamp operates for a long time. The only competitive

traditional technology with LED is low-pressure sodium, but it has a limited lifetime and

dimming control lower than the LED one.

Remark: the previous topic is in use in case the customers in the Middle East still asking the

benefits from implementing Smart SSL system, Italwarmi & Sustainergy usually attach this part

of the study with the project’s feasibility analysis and the energy assessment files.

Bergamo Montecchio

Emilia Brescia Turin

Purpose

Increase energy

efficiency and light

quality, reduce costs and

be a more eco-

sustainable and safe

city.

Be up to date

with the smart

city trend, and

benefit from the

advantages of the

smart street

services.

Implement a smart

lighting system to

take advantage of

the energy savings

and replace all

public lamps with

LEDs.

Align the city with

the 20-20-20

European

framework in

terms of energy

efficiency,

environment and

mobility.

Strategy

Replace 15,000

traditional lamps with

LEDs.

Replace 2,300

lighting fixtures,

install 4 cameras,

9 Wi-Fi access

points and a

management

control system.

Replace 16,000

traditional lamps

with LEDs.

Turn into a “full”

smart city

Reduce the

average

consumption of

luminaires from

150W to 75W.

Savings

Reduced energy

consumption by 43%

3.15 million € net

savings within 9 years.

Avoided replacement of

5,000 lamps.

Reduced energy

consumption by

55%.

Reduced energy

consumption by

40%

8 million € net

savings within 10

years.

Avoided

replacement of

2,500 lamps and

10,000 luminaires

per year.

Reduced energy

consumption by

60%

Saving of 10,700

tonnes of CO2

(4,000 tonnes of

oil equivalent) a

year.

Table 4: comparison between the smart lighting projects in Italy, affirming LED is the best available

technology in the lighting applications.

Sources: Reverberi, ASSIL, Phillips Italia projects references.

29 | P a g e

2.2. Solar panels

The solar panel technology is the power generator of the SSL. It is a renewable energy

technology that supplies the lighting fixture with the power to sustain the illumination. The

solar panel converts the incident sun rays on the earth surface into electricity due to the silicon

material. The silicon as a semiconductor is the core raw material of the solar panels

manufacturing.

The solar panel is manufactured by the using the doping process in which the insertion of

phosphorus substance from the fifth group and boron element from the third group in the

crystalline structure of the silicone, then the connection of two different layers together.

In the current market, there are a lot of solar panel types, Such as Monocrystalline,

polycrystalline, Transparent solar panels, amorphous silicate, cadmium telluride, CIGS-CIS and

organic cells. As noted in the table, the solar panels types have different efficiency range based

on the raw materials. In the upcoming years, the photovoltaic market reaches a massive

flourishment thanks to the investment in the R&D to improve the efficiency of the

underdevelopment solar panels.

The most diffused solar panels technologies in SSL applications are monocrystalline and

polycrystalline because they have high technical and economic efficiency.

Mono-

Crystalline

Silicon

Poly-

Crystalline

Silicon

Amorphous

Silicon

Cadmium

Telluride CIGS-CIS

Efficiency 16-21% 15-20% 6-9% 10-14% 11-13%

Maturity Mature Mature Under Development Under

Development

Under

Development

Advantages

• High

efficiency.

• Reliable

technology.

• High

efficiency.

• Reliable

technology.

• High

architectural

integration.

• Good efficiency

for irradiation

diffusion.

• Production

cost

reduction.

• Production

cost

reduction.

• Long term

performance

stability.

Disadvantages • Higher

unitary

cost.

• Higher

unitary

cost.

• Low efficiency.

• Low stability of

long-term

performances.

• Cadmium

toxicity.

• Difficult

acquisition of

raw

materials.

Table 5: comparison between the types of solar panels.

Source: studying material of Energy management & sustainability Prof. Vittorio Chiesa.

30 | P a g e

The difference between monocrystalline and polycrystalline

Silicon solar panels are the most popular technologies that dominated 80% of the PV market.

There are differences between monocrystalline and polycrystalline in the shape and the

performance. Both have a reliability and maturity market. Appointing the difference between

the Mono & Poly- crystalline solar panels is essential for selecting the right panel type in the

early phase of project management to fit the requirements and estimate an accurate feasibility

analysis.

2.2.1. Monocrystalline silicon solar panels

The external dark black colour characterises the Monocrystalline

silicon solar panels. It is manufacturing from cylindrical silicon

ingots that cut into wafers. They have higher efficiency by better

exploitation of the sun irradiation due to the purity of the silicon.

Advantages of monocrystalline silicon solar panels

- High efficiency.

- Smaller installation area.

- Long lifespan.

- Excellent performance under low irradiation conditions.

Disadvantages

- High expensive solar panels.

- Circuit breakdown when the solar panel covers with dirt,

shade or snow.

- Lower performance while increasing the operating

temperature.

- Silicon waste during the manufacturing process.

Figure 14: Monocrystalline Solar Panel. Source: Amerisolar technical

data sheet.

31 | P a g e

2.2.2. Polycrystalline silicon solar panels

It has a commercial name multi-crystalline solar panel. Unlike

monocrystalline solar panels, melted silicon poured into a

square mould, cooled then sliced into square wafers creating

the shape of polycrystalline.

Advantages

- The production process is simpler and cheaper than the

monocrystalline solar panel.

- No silicon wastes.

- Higher performance while increasing the operating

temperature compared to the monocrystalline solar

panel.

Disadvantages

- Lower efficiency due to low silicon purity.

- Require higher installation area than the monocrystalline

solar panel.

- Lower architecture integration.

2.3. Battery

The energy storage system is critical to enhancing the diffusion of renewable energy

technologies in several electricity applications, primarily in the Off-Grid (stand-alone) solar

street lighting systems. Therefore, the European Commission supports the energy storage

industrial sector to achieve its 2020 energy objectives of reducing GHG emissions.

Technically, the energy storage battery increases the flexibility of the renewable energy

technology. In the solar street lighting application, the battery is necessary to store the

electricity produced during the daytime to power the LED bulb during the night. The batteries

solve the problem of output wattage variability by providing a constant power source to run

the LED light in the solar street lighting system.

The battery is an electrochemical cell consists of two dissimilar electrodes and electrolyte. The

anode is a negative electrode, and the cathode is a positive electrode. The electrolyte is the

medium that separates between the two electrodes and in charge of the ions flow from the

cathode (-ve) to the anode (+ve).

The functionality of most batteries is standard; there is a REDOX electrochemical reaction inside

the battery; the reduction and oxidation reactions occur during the charging and the

discharging process. The electrons are produced from the oxidation reaction and flow through

an external circuit to achieve the discharging process, at the same time the ions generate by

the cathode from the reduction reaction and transfer via the electrolyte to compensate the

loss of ions. There are many types of energy storage systems in the renewable energy market

(e.g. the Lead Acid battery, Lithium Iron Phosphate battery, Nickel-cadmium battery and Nickel

metal hydride battery).

Figure 15: Polycrystalline Solar Panel. Source: Amerisolar technical data

sheet.

32 | P a g e

2.3.1. Lead Acid battery

The Lead Acid battery is one of the oldest energy storage technologies, and it has various types.

All designs of lead-acid share the same basic chemistry, where the positive is the electrode

made of lead-dioxide, while the negative electrode formed of metallic lead and the electrolyte

is sulfuric acid.

• Flooded Lead Acid batteries: are electrolyte filled batteries, FLA requires regular

maintenance to equalize charges and to keep the top and terminals clean. It has an average

lifespan and low cost per Amp hour.

• AGM batteries have a little internal resistance that gives the advantage to power a high

current intensity and provides suitable electrical reliability. The advantage that AGM battery

has a charging rate five times more than FLA.

• GEL batteries have the same internal material of

the AGM type. The main difference in the

electrolyte of the AGM battery is a liquid. In

contrast, in the gel battery, the electrolyte has

some solid silica additive. The price of the Gel

Batteries is slightly different from the AGM battery,

and it characterizes by slower discharge rate and

higher operating temperature.

2.3.2. Lithium-Ion battery

The Lithium-ion batteries are the highest diffused rechargeable battery in which lithium ions

move from the anode to the cathode during the discharging process, and from the cathode to

the anode during the charging. Almost the anode's raw material is graphite. There are different

types of Lithium Ion batteries concerning the cathode material, e.g. a layered oxide (such as

lithium cobalt oxide as noted in the figure), a polyanion (alike lithium iron phosphate), or raw

material same (Nickel-cobalt-Aluminum). Originally the battery usage depends on the choice

of the material for the anode, cathode, and electrolyte; thus, the battery specifications are

changing dramatically.

Figure 16: GEL Battery. Source: Sunmaster catalogue.

33 | P a g e

The most popular Types of Lithium-Ion batteries are:

1. Lithium Iron Phosphate is a sort of Li-Ion rechargeable battery for high power applications.

LIP cells feature with high discharging current, non-explosive, and long cycle life; however,

on the downside, its energy density is lower than regular Li-Ion batteries.

The Lithium Iron Phosphate technology is characterized by high thermal and chemical

stability, which provides better safety than other Lithium-ion technologies made of different

cathode materials. LiFePO4 is more stable under overcharge or short circuit conditions, and

it can withstand the high temperatures without degradation.

2. Lithium ternary: power lithium ternary primary raw materials are NCA, due to high

temperature, the NCA structure usually becomes unstable. It has low performance under

high operating temperature. Lithium ternary batteries have a lower lifecycle than the

Lithium Iron Phosphate batteries.

The most diffused energy storage systems in the solar street lighting applications are Gel

batteries and the Lithium Iron Phosphate. There is a considerable difference between them

in term of the technical specifications and the prices.

𝐿𝑖𝑥𝐶6 ⇌ 𝑥𝐿𝑖+

+ 6𝐶+𝑥𝑒−

𝑥𝐿𝑖+ + 𝐿𝑖1−𝑥𝐶𝑜𝑂2+ 𝑥𝑒− ⇌ 𝐿𝑖𝐶𝑜𝑂2

Charge

Charge

Discharge Discharge

Charge

Discharge

Figure 17: Lithium Ion battery chemical reactions. Source: Studying material of fundamentals of energy technologies Prof. Matteo Zago (Polimi).

34 | P a g e

The table as mentioned earlier is figuring out a comparison between two of the best available

technologies in the batteries’ market that are used in the solar street lighting systems so as

indicated the differences between LIP & GEL batteries technical specifications.

Lithium Iron phosphate has significantly higher cycle life than Gel battery; thus, the working

lifetime of the LIP is higher than the Gel. All the electrical parameters such as voltage, power,

energy density, the specific energy of the LIP is higher than the gel batteries. Additionally, the

maximum temperature limit in the LIP is higher than gel batteries that give LIP higher internal

chemical and thermal stability.

2.4. Controllers

The controllers are a crucial component in the SSL applications. The role of the controller is to

regulate the input and output electrical current of the battery. Whatever the battery type, the

controller is used to secure the battery from damaging factors such as overcharging and

discharging.

LIP GEL

Nominal Voltage 3.3V 2V

Energy Density 300 WH/L 100 WH/L

Specific Energy 128 WH/KG 40 WH/L

Power 1,000 W/KG 400 W/KG

Cycle Life 5,000@ 80% DOD 1,900 @ 80% DOD

Calender Life 8-12 Years 5-8 Years

Max. Temperature 40 25

Safety High Moderate

Table 6: comparison between LFP and Gel battery.

Source: solar electricity handbook, Sunmaster batteries’ technical data sheet.

Figure 18: Controller. Source: Sunmaster catalogue.

35 | P a g e

2.4.1. Types of controllers used in the solar streetlight applications

- PWM controller (Pulse-Width Modulation) aims at ensuring that the charging process

never reaches the overcharging of the battery. The PWM controller allows a certain

amount of current that meets the battery target voltage to input. After reaching the

charging target, the controller disconnects between the battery and the solar panel.

- MPPT controller (Maximum Power Point Tracking): the concept behind using an MPPT

controller is to provide an indirect connection between the battery and the PV array.

This connection type includes a DC/DC voltage converter takes extra PV voltage and

transforms it into additional current at a lower voltage without necessarily losing the

power.

The optimisation of the electric current flow due to an adaptive algorithm allows the controller

to follow the maximum power point of the solar panels after adjusting the incoming voltage,

to maintain the most efficient level of power for our system. On the economic side, the price

MPPT controllers are higher than PWM controllers and the efficiency is up to 15-20% higher

than PWM. Generally, for small application such as a solar streetlight, a PWM controller is

economically efficient. On the other side, MPPT is suitable for large solar power systems.

Figure 19: diagram of how the PWM controller works in the SPS. Source: Sunmaster online course.

Figure 20: diagram of how MPPT controller works in the SPS. Source: Sunmaster online course.

36 | P a g e

2.4.2. Advantages of controllers

Besides the necessity of the controller, they have the following advantages:

- The reverse protection: if the reverse flow occurs, the solar panel acts as a load on the

battery; thus, it absorbs the electricity directly from the battery leading to unnecessary

discharging. The controller works to prevent the reverse current by facilitating the one-

directional flow of current from the solar panel to the battery and cuts out the reverse

flow during the night.

- Overload or overcharging protection: overcharging the batteries is an unrecommended

behaviour because it could reduce their lifetime. The controller role is to stop the

charging of the batteries once they are sufficiently charged.

- Temperature protection: since the increase of the system components operating

temperature harms the overall system performance and sustainability. The controller

can protect the system by reducing the power or switch off in case of increasing the

operating temperature thanks to the temperature sensor inside the controller.

- Starting on-off: the controller detects the voltage from the solar panels. If the voltage is

close to zero, it means it is becoming dark, and the light should be switched on. The same

for switching off, when the sunlight starts to produce electricity through the solar panels,

it means no needs to power the LED; accordingly, it switches off.

- Dimming: one of the controller functions is to dim the LED light. The lamp can work at

100% for a certain period and then dim to 50% until reaching 0%. The highest

performance of the Illumination system reached at its brightest level (100%) during peak

times of high traffic and then dimmed to accommodate times of low traffic, allowing for

maximum energy efficiency.

- Light driver: the controller has a built-in LED driver function. The LED driver is an

electrical device having a control loop built into them to regulate the input LED power

by providing them with a constant quantity of power. The power level of the LED is

maintained constant by the LED driver because of the variability of the temperature up

and down effects on the electrical properties of the LED light. Without the proper driver,

the LED may become too hot and unstable, causing poor performance or failure.

2.5. Metal structure

After the explanation of the electrical devices of the SSL, now the turn to identify all the

mechanical component that supports the structure of the lighting system, they are

representing in poles, arms, mounting structures and the foundation kits.

2.5.1. Poles

Mainly, there are four types of poles used to support streetlight luminaires and all the system

components. The poles are classified based on their manufacturing raw material such as wood,

reinforced concrete, steel and FRP.

The most common pole uses in the street lighting applications is steel poles regarding the long

lifespan, good architecture shape and ease installation. Steel is exceedingly durable compared

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to other metals, and it is 100% reusable, making it fully compliant and matching with the cradle-

to-cradle policy.

Also, it has highly beneficial properties in respect of metal-fatigue. It is insensitive to galvanic

corrosion and is suitable for welding. A thermally galvanised pole is guaranteed to stand for at

least 40 years without maintenance, and the well-preserved pole has a theoretical limitless life

span.

There are factors to be considered when selecting a pole for streetlight application such as wind

calculations and application location like desert or close to the sea locations, a further factor,

the mechanical loading of the attached components such as LED fixture, solar panel, controller

and batteries. Also, flags, banners, billboards or any similar items will be attached to the pole

in the future should be considered. The selected pole must have sufficient strength to

withstand the loading of these external loads.

Poles manufacturing based on the project’s specifications because for each project, there are

dimensions variety such as the cylindrical radius, the thickness, the height and the pole design.

2.5.2. Arms

As shown in the figure, the arm is holding the luminaire next to the top point of the pole.

Luminaire outreach arms are curved or straight and the length of the outreach is the horizontal

distance from the vertical centerline of the mast to the tip of the outreach, excluding the lamp

mounting spigot. The arm is installed horizontally to the pavement with a 5-degree angle as a

maximum.

Figure 21: the arms position in the solar streetlight system. Source: Sunmaster catalogue.

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Factors are considering for the pole arm selection:

- The pole types.

- Pole location to curb or roadway.

- Arm strength: the arm length must be sufficient to withstand the weight of the luminaire

and the wind loading on the luminaires.

2.5.3. Brackets

Brackets are necessary components in the solar street lighting applications to assembly all the

solar street lighting system components to match the system design.

Nowadays, there are several brackets available on the market for fixing the solar panel and

lighting fixture, the purchasing decision based on the bracket’s material, the dimensions and

the price.

The bracket shape is noted in the sketch and shown its position in the solar street lighting

system.

Figure 22: drawing of the arm design. Source: Sunmaster technical data sheet.

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2.5.4. Corrosion protection

The majority of the poles in the SSL are manufacturing from steel Q235. This type has

protection from the air oxidation, salt and moisture that result in material corrosion to increase

the lifetime of the steel pole, it must be treated for preservation. In case an application involves

untreated pole, then it gradually eroded and discarded in a short time. The universal protection

methodologies for the poles steel are thermic galvanisation and the powder coating.

2.5.5. Thermic galvanisation

In 1742, the French chemist Malouin discovered the galvanisation process to preserve steel

against air oxygen, salt and moisture. Nowadays, the poles workshops have a developed

economic galvanisation process using the SSL industry. The HDG is a form of galvanisation; it is

the method of covering iron with zinc, which combines with the film of the base steel when

dipping the metal in a bath of molten zinc at a 449 °C temperature.

When the surface of the steel exposed to the atmosphere, the pure Zn reacts with oxygen

atoms to form zinc oxide, which further reacts with carbon dioxide to form zinc carbonate, a

usually dull grey, relatively durable material that protects the steel underneath from further

corrosion in many rough weather conditions. Galvanised steel is using in applications where

corrosion resistance is vital without affording the high of stainless-steel poles, and It has a

superiority in terms of cost and lifecycle.

Figure 23: drawing of the connection between the split system’s components. Source: Sunmaster online course.

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The thermal galvanisation has significant advantages concerning other preservation methods:

1. Full submersion in which the entire steel surface is coating with a layer of zinc. Besides, the

inside of the pole and steel components surrounding and attached with the pole.

2. Lower cost than stainless.

3. Long life expectancy.

4. Coating life and performance are reliable.

5. Outstanding resistance to mechanical damage.

2.5.6. Powder coating

It is the method for the creation of a protection layer on the steel structure to prevent from

the corrosion by applying a dry powder on the steel, then using the electrical charges to adhere

the powder on the intended steel surface. At the last stage of the process, the steel is heated

in a furnace at temperature 180°C, that resulting in a complete powder adhesion to the steel

surface. The powder ultimately hardens into a high-quality protective layer.

The advantage of the powder coating is the high resistance to mechanical stress. It forms a flat

surface area, which is easy to clean and has a long lifespan.

2.6. Cables

They are the connection that transmits the electricity from such a point to another. From the

technical point of view, the cables’ specifications should be chosen accurately to avoid any

damage that may happen in case overload occurred on poorly chosen cables.

2.6.1. Cables Definition

The electrical cable is producing through the assembly of two or more lines operating side by

side or bundled, which is used to transmit electric current from point to another. Electrical

cables consist of at least two conductors and typically have an outer covering. For cables

carrying higher voltages, the conductors within the cable encasing in a protective shield.

Cable sizing regarding the solar applications

Electrical cable sizes are expressing by gauge; a smaller value gauge indicates a larger size of

cable and the most common gauge for electrical cabling used in residential buildings is 12-

gauge range. Many large household appliances use electrical cables in the six to the eight-gauge

range.

Remark: to realise the importance of the cable sizing, imagine that when cables between

batteries back up, and from the batteries to the inverter have small size gauge, the available

current flow to the inverter is lower than the required, and it may fail to supply larger loads.

For example, if plugging the charger of the mobile phone to charge a laptop, the current flow

fails to supply the laptop battery efficiently regarding the low size of the cable. Appropriately

sized cables impose less resistance and thereby help to maximise the system efficiency;

therefore, there are recommended cables sizes for the SSL systems and a different one for the

SPS. While doing the design of the SPS, the designer should consider the expansion of the

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project as a factor that allowing the enlargement of the system installation capacity in the

future thus, the adoption of a higher current cable is the best choice.

2.6.2. Cable components

Besides the wires running side by side as a component of the cables, there are heat shrink

tubing and connectors.

Heat shrink tubing

It is a shrinkable plastic polymer tube used to protect

cables from external weather conditions and repair

the damaged wires or to connect them; also, it is used

to create cable entry seals, offering environmental

sealing protection. Heat-shrink tubing is making of

nylon or polyolefin, the polymer material shrinks

radially but not longitudinally when heated.

Connectors

They are electrical devices have plug and socket

connectors or terminal blocks, but individual screw

terminals and fast-on or quick-disconnect terminals

are more common than the socket connectors. Small electric components have bare lead wires

for soldering which are manufactured using casting. There are various connectors such as

plated copper lugs, blade connectors, ring and spade terminal, plugs and sockets.

1. Plated Copper Lugs: the lug is one of the various electrical connectors. It is an electro-

mechanical tool used to connect electrical ends, usually portable equipment and creates an

electrical circuit. Typically, electrical connectors consist of plugs with a male end and jacks

with a female ended. It requires a tool for fixing and removal or serve as a permanent

electrical joint between two wires or devices. An adapter can be used to bring together

different connectors effectively.

2. Blade connector: a blade connector is a type of single wire connection using a flat

conductive blade which is inserting into a blade receptacle.

3. Ring and spade terminal: the connectors have ring and spade terminals which in charge to

make the electrical conduction between devices. This type is one of the simple connectors

since the electricians mechanically fix them by utilising a screw or bolt to remove or attach

the spade terminal.

Figure 24: Plastic Tubing. Source: Cable Tie Company.

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2.6.3. Battery cables with lugs

First, Battery cables are used to connect batteries to the

solar controller and the PV module. They are also used to

connect multiple batteries. The cables have flexible

stranded TUV-listed copper wire, and the suitable cable size

depends on the current flow intensity. The cable end sides

are equipping with lug barrels covered with heat-shrink

tubing.

2.6.4. Battery interconnects

The battery interconnections are marked in red heat-shrink tubing for positive and Blue heat-

shrink tubing on the black wire for negative. During connecting the batteries in series or

parallel, the technician should accurately recognise the +ve and -ve signs on the battery. In the

battery series connection, connect the -ve with the +ve of the two batteries, on the other hand,

the battery in parallel, connect the +ve with +ve and the -ve with -ve of the batteries.

2.6.5. PV arrays’ cables

Solar array cables connect the solar panels and to connect the

solar array to the solar controller. Usually, they are attached to

the modules which are also TUV listed. The cable connectors on

these are fully waterproof when connected, touch-protected and

designed for up to 1,000 VDC and 30 A and resistant to high

temperatures. Most of the output cables manufacturing with 10

AWG PV wire, and Amphenol H4 connectors, and can be used in

solar arrays up to 1,000 VDC.

2.6.6. Connectors

These output cables are also Amphenol H4 connectors and

compatible with the modules to connect strings with On-Grid

inverters or combination boxes. They have two terminals, one is a

male end, and the other is a female end. They can be used to long or short the cables on the

modules and used to connect to a rooftop junction box, For example, if the application needs

a 30’ male and a 20’ female, order a 50’ cable made with black 10 AWG 1,000 VDC-rated PV-

Wire cable.

Figure 25: Battery Cables. Source: Sunmaster catalogue.

Figure 26: panels interconnection. Source: Sunmaster technical data

sheet.

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• Amphenol Helios H4 connectors: the 1,000 VDC-

rated Amphenol Helios H4 connector includes the pins

which enabling connecting the cables custom cables

at the job site. A proper crimping tool and wrench set

are required to assemble the connector. These

connectors are for use with 10 AWG PV wire.

• MC4-Solarline 2 branch connectors: these

waterproof Y-connectors make it possible to parallel

wire PV modules with multi-contact output cables.

Branch connectors are rating for the maximum

current of 30 A and the maximum voltage of 600 VDC.

2.7. Smart management control systems

The transition from the traditional public lighting to SSL is highly efficient with the adoption of

the smart management control system. Thanks to the high flexibility ensured by the light-

emitting technology can be exploited to reach higher performances, considering efficacy,

energy efficiency and lower O&M costs. All the manufacturers of the SSL systems enter the

market with MCS as a leading product regarding the demand increasing.

Since each manufacturer is looking to having a competitive advantage by using his technology,

the SSL market has different models of MCS. The main LED’s manufacturers started to develop

hardware and software aimed at controlling the illumination system together. The main aim of

a lighting control system is to provide light when and where it is needed to increase energy

efficiency. The MCS allows communication between the various input and output components

installed in the overall lighting system and one or more central computing systems that with

specific algorithms or with manual control regulate the lighting output of the various lamps.

MCS is the so-called adaptive lighting control, where the light is regulating according to the

different data collected by the sensors. The communication infrastructure could be Wi-Fi or

wired, but with the no-cables technology is considered as the real opportunity.

Further, the MCS is more developed in the private sector where investments on energy

efficiency measures and innovative systems have a higher priority than in the public

administration. In the industrial, residential and commercial buildings these systems, indeed,

have already a high diffusion. The spread of the MCS is related to the availability of financial

resources that, in the case of private entities, could be higher.

2.7.1. The approaches and devices of the MCS

• An automated algorithm: it regulates the voltage and the lighting output of the lamps within

a range. In this case, usually, the lighting is scheduled and programmed according to the

different time intervals of the day. For example, during the high traffic, the illumination

output is 100%, then the dimming mode reduces the lighting output until reach 80% within

the moderate traffic and 60% or less during the low traffic. The importance of this type is

the higher reduction in energy consumption without investment.

Figure 27: Connector’s Male & Female terminals. Source: Sunmaster technical data sheet.

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• Point to point control system: it is the most innovative approach that allows to monitor and

dim each lamp individually or in clusters. In this case, it is possible to control in real time the

lighting output of each lamp in the solar lighting system, the state, failures, the energy

consumption and scheduling the intervention and the maintenance with higher precision

and lower costs.

The MCS is under development in the R&D departments of the hardware manufacturers and

the software developers. For this reason, different players in the markets of lighting and IT

platforms are starting a partnership to develop a dominant design.

This collaboration improved the management control systems by the insertion of IoT

technologies. The functionality of these systems is to optimise the light output taking the

consideration of all the empirical data collected by fixed sensors in the lighting system.

The most common sensors are:

• Photocells sensor: is an electronic device positioned on the top of the luminaire to detect

the changing light level. It uses to manage the light output of the lighting systems.

Automatically, the light turns on when it gets dark, or they detect motion. The photocells

sensor saves energy by turning themselves off when extra light is unnecessary.

• Motion sensor: this device reacts to physical movement; it detects the movement in the

lighting location by the infrared or microwaves and reflects as signals to activate the light.

Also, it is used as energy-saving technology in commercial buildings, turning off lights in

empty offices. Many of these products have adjustable for use in several applications of

solar street lighting systems such as driveways or walking paths.

• Speed and direction sensor: it works for a more comprehensive detection area to classify

the movement following its speed and its direction. This classification provides the right

response according to predefined lighting scenarios.

The central management server is responsible for data collection and analysis. With software,

it creates the central control interface where it is possible to monitor the state of the system

and apply for the energy-saving strategies and programs. This interface also allows controlling

in real time the lighting system in case of emergency. The software is the real PoD of the

companies. It analyses all the data coming from the sensors trying to interpret them and

determine the necessary level of light. Manufacturers pointed out as the core component of

the overall system requires informatics knowledge and capabilities that traditionally was

absent or low in LED and lighting companies; this is the reason why, especially for smaller

companies, the IT companies became a valuable resource and the established partnership

could represent the real source of competitive advantage.

Once analysed and elaborated the data, the software communicates to the gateways the level

of lighting desired for the different nodes. With the actual technology, each gateway usually

can manage between 200 and 300 nodes simultaneously, which designed for reliable

operation, even in the hard weather conditions.

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2.7.2. The advantages of the MCS

• Cost reduction: the adoption of a suitable control system, it can save energy up to 50% by

decreasing the maintenance and the operating expenses in addition to reducing the carbon

dioxide emissions.

• Easiness to use: ease of access and be well-informed on the SSL current state via an internet

connection, by computer, mobile or tablet.

The MCS consists of the following hardware devices and software:

1. Control centre: this is the monitoring platform of the control system. It consists of the PC,

server, SSL control software, Web server, and other devices. The control centre functionality

is to receive data from the GPRS/CDMA module of the data centre. Therefore, it facilitates

to check the working conditions, monitoring the lights, and control them in real time.

2. Gateway: the component collects information from a unit and transmits it to another. It

collects the terminal controller’s information gathered from the solar lights. Here, the

Zigbee signal is translated to GPRS/Ethernet signal, then forwarded to the control centre.

3. Terminal controller: the device works on managing, charging, and discharging solar system

batteries. The information following is from the solar panel, battery and the LED fixtures.

Moreover, it controls the lights’ dimming and switching on and off.

2.7.3. Sunmaster MCS technologies

• Gateway CC08Z with the following functions:

- Turning on/off, dimming, and querying the terminal controller.

- Adjusting the lighting schemes automatically according to pre-setting.

- Storing the collected data and the device execution history.

- Communicating uplinks (i.e. GPRS/CDMA/Ethernet).

- Communicating downlinks (i.e. Zigbee/RS485).

- Remote upgrading.

- Encrypting data during communication.

- Alarming the control centre.

• Controller RTU12W with the following functionality:

- Switching on/off, dimming and querying the terminal controllers.

- Data collection from the solar panel, battery, light status, current and voltage of each

lamp.

- Uplink communication (i.e. Zigbee).

- Downlink communication (i.e. RS485).

- Remote upgrading functions.

- Data encryption during communication.

- Alarming the gateway.

In addition to the remote monitoring system, there is a possibility of adding security cameras

powered by the same solar panel as an integrated system, it gives many advantages with low

cost and has the following features:

1. 3G/4G transmission module included thus, no cables required for connection and ease of

the installation.

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2. Remote camera power on/off via SMS, that gives the possibility to take/send photos via

SMS.

3. Eco-Friendly since, the camera is powered by solar/wind power, fit in with the local

landscape.

4. Affordable according to the durable and reliable lighting structure reduces maintenance

costs.

5. Safe corresponding to the system ensuring the operation in case of emergency.

2.8. Technologies of the Solar Power System

Most of the adopted technologies in the SPS are mainly the same as the SSL (e.g. the solar

panels, batteries, controllers, and cables). The difference is the existence of the inverter in SPS,

and obviously, the LED fixture and the pole are excluding. Finally, the design and the dimensions

of the solar arrays mounting structure customising according to the installation area in the

application. The following topic to clarify the inverters and types of SPS.

2.8.1. Inverters

The inverter is one of the major electrical components of the SPS, either off-grid or on-grid. It

is used to convert the direct current (DC) from the energy storage system or the PV arrays into

alternating current (AC).

The inverter types for the SPS applications

The inverter specification should be chosen accurately because the inverter type affects the

overall performance of the PV system. Any faults with an inverter are challenging to be

detected unless the inverter shuts down. Solar inverters are classifying into three broad types

based on the types of the SPS such as Off-Grid, On-Grid or Hybrid systems.

Off-Grid inverters

This type is using as a central electrical device in the stand-alone SPS. The specification of the

off-grid inverter fits neither the on-grid systems nor the hybrid system. The DC flows to the

inverter from the batteries charges by the PV arrays converting into AC flows to power the

electric devices.

Moreover, it works as a power tracker to monitor the maximum power of the solar panel and

energise high-quality power with regulated voltage and frequency to the loads. The inverter is

featured with energy storage and staggering power consumption as well. This type is sufficient

for medium-sized or large-scale residential, commercial and industrial PV applications which

DC Power In AC Power Out

Figure 28: the electrical current conversion from DC to AC. Source: Sunmaster technical data sheet.

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are off the grid, such as a village, farm, factory, and office buildings.

Technical features of the stand-alone solar power systems:

• High-speed DSP digital control.

• Multi-string PV connected.

• Multiple remote control for startup and shutdown.

• Using multicore control technology and auto MPP trackers, auto-start AC rectifier enables

PV and AC source to supply power to the loads at the same time in the event of insufficient

PV, which reduces battery discharge times and extend the battery life.

• Full-bridge inverter control technology, providing secure power supply in the event of three

phases 100% unbalanced loads.

• Intelligent staggering power consumption function.

• Intelligent AC and PV complementation power supply function to extend the battery life.

• Inbuilt AC rectifier and MPPT control modules, configured battery parameters by the

operating interface, self-regulation for charging voltage and current and easy maintenance

and power expansion.

On-Grid inverters

This type is specifically designed to be homogeneous with the tie-grid solar power systems with

a utility-supplied sine wave. Briefly, the sine wave is the electricity waveform for the AC power

with the following advantages:

- Generating less electrical noise during the operating.

- Equipment and appliances last longer, run with average operating temperature and

more efficiently.

For safety reasons, Grid-tie inverters automatically shut down when the loss of utility supply.

There is no battery back-up as in the Off-Grid. Grid-tie inverters convert the DC power from

the solar energy system into AC power and convert the voltage to the same as the grid; this

allows to connect SPS into the grid.

Technical features of the Tie-Grid inverters:

• Grid-tie inverters work in conjunction with the grid, to be able to export electricity to it. The

AC pure sine waveform generated by the inverter has to align with the waveform from the

grid.

• There is an additional safety feature with grid-tie inverters to cut off power from the solar

array if the grid shuts down.

• Grid-tie inverters are connected directly to the solar panels. In an in-series system, this

means the input voltage from the panels can fluctuate wildly, often jumping or dropping by

several hundred volts in an instant. Off-Grid inverters cannot cope with such massive

voltage jumps.

• In the GCC countries, the grid-tie inverters must fit for use with the grid according to

standard specifications for the input voltage, power rating, power tracking and the number

of strings the inverter can support diagnostics and reporting information.

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Hybrid inverter

The based interactive inverters manage photovoltaic array output power production, battery

back-up, and the utility grid. All these stages are connecting to the hybrid inverter.

The hybrid inverter has an Emergency Power Supply that offers back-up power if the utility

power fails. In this case, the power is come out from the battery back-up to the maximum

capacity of the inverter installed. The designer should consider a sufficient independent battery

back-up without using the utility power. The priority of the hybrid inverter is to use solar

power; if there is over consumption from solar power, the inverter compensates the imbalance

from the utility power. If solar power exceeds the average consumption, the excess power is

storing in the battery back-up. If the batteries are full of charge, the excess power injects into

the grid; therefore, Solar Hybrid Inverters offer great value for production and consumption

security.

2.8.2. Basic electrical specifications of the On-Grid power inverter

Input voltage

The input voltage is the potential difference between a negatively charged object and a

positively charged one, with Volt as a unit measure of the potential difference. It represents

the work done per unit charge to move electrons between the positive and negative terminals.

If a potential difference exists, then energy can be extracted.

Choosing the suitable inverter for the SPS is based on a broad voltage range, from this voltage

range, the designer can identify how many solar panels the inverter can cope with either the

connection is in series or parallel and increase the design flexibility considering the future

expansion of the system. The On-Grid inverters are manufactured to withstand the variability

of input voltages and the most common voltage range in the residential sector is 50v up to 500v

per string. Nowadays, thanks to the development of inverter technology, one inverter can be

connected with two or more strings. These types of inverters are more expensive than the

traditional one.

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There is a difference between the rated nominal voltage and the maximum voltage that the

solar panel generates. As listed in the table, the higher the nominal voltage from the solar array,

the greater the voltage fluctuation. The voltage from a single 12v solar panel can raise from 12

volts within the deficient productive day of the solar irradiation up to 20v in an intensely sunny

day a dup to 26v in an open circuit.

Practically, the role of the inverter in the SPS is to ensure that the solar panel works safely not

only with the nominal voltage array but also with the generation of the peak voltage and the

maximum open circuit voltage. If power generation exceeds the peak voltage of the inverter,

the inverter shuts down automatically to avoid the damage.

The same functionality at the minimum input voltage, if the total voltage of the system drops

below the minimum input voltage, the inverter switches off automatically. In these cases, the

solar panels still generate energy and considered as electricity loss. A low minimum input

voltage means more power generation at the start and end of the day to ensure higher power

generation in the cloudy days or the winter season.

Power rating

There are two power ratings for the On-grid inverter:

- Input power rating: They are the minimum and maximum amount of power the inverter

can accept from the solar array.

- Output power rating: They are the maximum amount of power and current the inverter

can generate as an AC output.

Number of 12v

PV

Nominal PV

voltage

Low voltage on dull

day

Peak voltage

in intense

sunlight

Max. open-

circuit voltage

1 12v 12v 20v 26v

2 24v 24v 40v 52v

4 48v 48v 80v 104v

6 72v 72v 120v 156v

8 96v 96v 160v 208v

10 120v 120v 200v 260v

15 180v 180v 300v 390v

20 240v 240v 400v 520v

25 300v 300v 500v 650v

30 360v 360v 600v 780v

35 420v 420v 700v 910v

40 480v 480v 800v 1,040v

Table 7: the relation between the number of solar arrays and the nominal and max. voltage.

Source: solar electricity handbook 2017.

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Input power rating

The input power rating indicates the minimum and maximum wattage range with which the

inverter can interact. There are three main parameters to be considered for choosing the most

efficient inverter:

• A nominal power rating in watts: it is the maximum amount of power the inverter can

convert from DC input to AC output. In case, the inverter receives overpower from the solar

panel, it is going into heat, and the inverter automatically switched off to protect from

overheating damage.

• A minimum and maximum power range: this parameter shows minimum power input to

the inverter to start the conversion from the DC input to AC output. On the other hand,

ensure the maximum power input to the inverter without any damage. Therefore, the wider

the input power rating, the more the efficient the inverter.

• A start-up power rating: is a minimum power required for starting the operation of the

power inverter. Thus, below this minimum amount of power, the inverter does not start up.

Output power rating

The output power rating is the maximum continuous AC power that the inverter can generate.

The output power information signals the voltage, the nominal power output in watts, the

maximum output current in amps, the maximum efficiency rating of the inverter and the

alternating current frequency.

Power tracking

The power inverter has a built-in MPPT controller. Currently, the MPPT controller is the norm;

it is active for the SPS to monitor the input and the output power rating of the inverter.

However, there are a few older designs of inverter still on the market, often sold at competitive

prices online. No matter how cheap these inverters are, the performance loss rarely makes

them a worthwhile investment since the inverter is the brain of the SPS.

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2.8.3. Diagnostics and reporting information

The status of the SPS performance can be remotely monitored as the same in the SSL

applications thanks to the development of the IoT.

The highly advanced technologies of the inverters now have a built-in internet connection,

allowing them to connect to a wireless network and signalling any detected fault. That means

the end user can receive the updates via e-mail, via a website, or even send notifications to the

mobile phone application. The diagnostics and reporting systems usually have the same

software design as in the following image that is ensuring the SPS has one central information

platform.

The diagnostics identify the faults of the SPS, such as the following:

- Insufficient or excess power from the solar array Grid.

- Connection status.

- Grid voltage or frequency.

- Overheating.

Most solar inverters provide much more information, signalling the voltage and current from

the solar array and the generated amount of AC power at that moment. They are also able to

show the amount of energy generated by the system, both for that day and since the day one

the system installed.

Figure 29: screenshot for a platform of the power tracking. Source: solar electricity handbook.

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2.8.4. The types of solar power systems

There are several types of the SPS differ according to the solar system configuration such as

Off-Grid system, On-Grid system, Hybrid system or Fallback system. Each type is preferable in

a specific sector such as the residential, the commercial and the industrial sector.

Off-grid system

The stand-alone system is the most diffused PV technology in the solar market. It was the

starting point for developing other types. The users prefer this type for installation in remote

areas because of no need to expand the electricity infrastructure to power the utilities in the

residential applications. The Off-grid system usually adopted to generate power less than 1Kw

and the functionality of the system is basically, generating the electricity from the sun during

the daylight and store it in the battery bank, then the electricity consumption starts after

convert the DC flow into AC through the inverter to be familiar with the electricity type of the

appliances.

From a business strategy perspective as a startup, Egytalia should enter the market by

introducing the off-grid systems as a first step because it is the simplest type among the SPS.

Figure 30: Off-Grid system components and connections. Source: Indiamart website.

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On-Grid system

Grid-tie comes to the SPS market thanks to the potential profitability from the feed-in tariffs

regulations in Europe and the USA; then the technology moved to the Australian energy

market after public institution supporting the application with incentives.

Currently, the demand for this type is increasing in Egypt and the GCC countries due to the

availability to sell the electricity to the government that generates profit. In the grid -tie

system, the homes or the companies run on solar power obtained during the daylight and

stored in the battery bank or powered directly from the local grid in the urgent case or

during the maintenance period of the SPS. Any surplus energy is injecting in the national

municipal grid or selling to the nearby company.

The stand-alone system is the most diffused PV technology in the solar market. It was the

starting point for developing other types. The users prefer this type for installation in

remote areas because of no need to expand the electricity infrastructure to power the

utilities in the residential applications. The Off-grid system usually adopted to generate

power less than 1Kw and the functionality of the system is basically, generating the

electricity from the sun during the daylight and store it in the battery bank, then the

electricity consumption starts after convert the DC flow into AC through the inverter to be

familiar with the electricity type of the appliances.

Remark: from a business strategy perspective as a startup, Sustainergy should enter the

market by introducing the off-grid systems as a first step because it is the simplest type

among the SPS.

Figure 31: On-Grid system components and connections. Source: Indiamart website.

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Hybrid System (grid-tie with power backup)

The hybrid system is a grid-tie with a battery -back-up. Even has a commercial name in the PV

market as an interactive grid system. The concept of this type is that the user can benefit from

the power output for his usage and inject the surplus in the national grid for tariffs in return.

Unlike the standard grid-tie, however, the battery bank is considered as a contingency for

power cuts.

Typically, the designer considers setting up power cut protection circuits attached to the

system to maintain the power supply for the principal utilities such as lighting and

refrigeration without wasting power for the other appliances in the urgent cases. The

electricity utilities are selected in the protection circuits according to the end-user priorities.

The hybrid system cost is much higher than the standard one due to the battery back-up and

the controllers, having power back-up adds 35–50% of additional costs over a standard grid-

tie system if using lithium batteries, or between 20–25% of additional costs if using more

conventional lead-acid batteries.

Figure 32: Hybrid system components and connections. Source: Indiamart website.

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2.9. The types of solar streetlight

There are two types of solar street lighting, the standard one is called the split system, and the

integrated one is called All-in-one as commercial names on the SSL market. The similarity of

the two types is that they have the same electrical and mechanical components such as (LED,

solar panels, batteries, poles, cables).

The difference is the design of the systems. The All-in-one has a better integrated architectural

design. It consists of a board that includes all the solar street lighting components, as shown in

the image.

Figure 33: All in one board. Source: Sunmaster technical data sheet.

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The standard solar streetlight has a different design from the all in one. As shown in the image,

the components are positioning separately, especially the battery can be fixed underground,

or it places on the top of the pole.

The advantages of All-in-one are:

- Easiness installation.

- Beautiful architecture design for city life streets.

- The plug and play option that facilitates maintenance.

- Lightweight design.

- Rust, Dust, and Waterproof.

The disadvantage of the All-in-one is the inflexibility of the system customization related to the

variability of the geographical locations because the inclination of the solar panels cannot be

Figure 34: split system components. Source: Sunmaster catalogue.

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optimized to exploit the highest amount of solar irradiation. In many cases, the module

inclination goes against the optimal lighting distribution; therefore, the designer should trade

off the lighting efficiency and the solar panel efficiency.

The advantage of the standard split solar streetlight is the flexibility of the system

customization to meet any project specifications such as increasing the capacity of the solar

panel and the battery according to the project requirements.

It has the disadvantage of taking a long time in the installation because of the assembly of the

components. Moreover, if the battery is positioning underground, there is electricity lose due

to the long-distance cabling between the solar panels and the battery. Most demand of the

Split systems is from the highways illumination and the outdoor lighting facilities in remote

areas. On the other hands, the significant demand for the All-in-one is from the parking,

residential, commercial areas.

3. Chapter three (market analysis)

3.1. PEST analysis

3.1.1. The advantages of PEST analysis

1. Enabling the company to identify the potential opportunities to exploit and detect the

threats to avoid in the future.

2. Provide alternatives to the decision makers to improve the company against the significant

change in the circumstances.

3. Protect the decision makers from operating in unstable markets or make them avoid

participating in unprofitable projects regarding their company’s capabilities and reduce the

gap of uncertainty about the success of reaching the company objectives.

4. Make the policymakers more aware of new market or region and help them to create an

accurate roadmap to reach the objectives.

3.1.2. Factors of PEST analysis

The PEST analysis is practically carried out by identifying the four points frameworks in order

to assess the following range of factors:

• Political: Political stability, government effectiveness, corruption and regulations.

• Economic: GDP, trends, interest rates, inflation rate, unemployment level, price controls,

exchange rates.

• Sociocultural: demographic changes, education, birth rate, Labor power.

• Technological: patent protection, industry spending on R&D, productivity improvements

through automation, technological trends affecting the industry.

Remark: Sometimes, the tool analysis is called (PESTE) by adding the Ecological factor, which is

most common in the marketplaces around the world. It is related to the environmental

responsibility and eco-sustainability; this factor based on the environmental protection laws,

decommissioning costs and environmental concerns of customers. Most of them are derivate

from convections such as Paris agreement, which is recognized by the Egyptian and GCC

governments and stated in the MoU between them and the European Commission.

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3.1.3. Practical PEST analysis on the Egyptian market

Once finishing the identification of each factor, the decision makers should brainstorm the

opportunities and threats that each area presents, then, identify actions that can be taken to

exploit any opportunity and to manage or eliminate threats.

The practical way to carry out this analysis is the identification of each possible factor (F), after

that detecting their current values (V1) then, starting the prediction of the changes that might

happen until 2025 in order to foresee if these values increase or decrease and determine the

approximate future value (V2). The final evaluation is rating the impact (I) of the future values

(V2) in the upcoming five years from -5 to +5. Last but not least, concluding the opportunities

and threats; consequently, the company can identify the properly added value reactions to

translate the opportunities into profit and avoid the threats.

The prediction is based on the exploitation of the regulation’s analysis in chapter 1 and

continually gathering data about the political, economic, socio-culture and technological

potential changes in each country through the direct interaction with the market players,

attending economic conferences and building stable relationships with the responsible

ministries.

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Factors

(F)

Value

(V1)

Prediction

(P)

Value

(V2)

Impact

(I)

Political

Political stability

range (-2.5 to 2.5) -1.42 Increase 1 +2

Political risk

range (1 to7) 6 Decrease 3 +3

Government effectiveness

range (-2.5 to 2.5) -0.62 Increase 1 +2

Regulatory quality

range (-2.5 to 2.5)

-0.86 Increase 1.5 +3

Rule of law

range (-2.5 to 2.5) -0.53 Increase -0.7 -3

Control of corruption

range (-2.5 to 2.5) -0.54 Increase 0 -4

Economic

Economic growth (%) by 2023 5.46% Increase 5.98% +4

Inflation rate (%) 12.49% Decrease 7.19% +4

Interest rate (%)

14.1% Decrease 11% +3

Exchange rate

(EGP regarding 1 USD) 17.25 Decrease 15 EGP +3

Unemployment rate (%) 9.87% Decrease 6.44% +3

Tax rate (%) 23% Increase 30% -1

Labor Force

(Millions) 31.87 Increase 35.5 +2

Socio-

Cultural

Population size

(Millions)

100 Increase 112 +2

Human development

range (0 to 1) 0.696 Increase 0.8 +3

Globalization index

range (0-100) 63.08 Increase 80 +4

Innovation Index

range (0-100)

27.2 Increase 35 +4

Education spending from GDP

(%) 3.76% Increase 7% +4

Health spending per capita

(USD/Person) 130.99 Increase - +3

Tech. SSL & SPS components Importing Local

manufacturing

Takes at least 5 years to compete

the foreign products +5

Table 8: practical analysis of PEST model factors.

Source: World Bank, market research reports, the global economy websites.

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3.1.4. Opportunities and threats of the political factors

Political factors are the base of any marketplace. They are integral and rely on each other one

by one. There is a proportional relation between political stability and other factors. For that

reason, the more the country reach political stability, the higher the economic growth and

society satisfaction. Egypt suffered from political instability for almost eight years after the

Arabian Spring revolutions. Since 2014, Egypt has started a comeback after a presidential

election led to stability for four years and the election has been placed again in 2018 to extend

the stability period until 2025; as a result, the political risk is gradually decreasing over the time.

Accordingly, a composition of the cabinet settled with the primary objective of increasing

economic growth and solve the lack of energy resources. The government engaged with the

world bank and the international monetary fund for a bunch of loans on the long run to start

the economic reform and finance the national projects in the energy Industry under their

supervision. The Egyptian government’s objectives must be aligned with the international

monetary fund instructions while reforming the energy sector by adopting renewable energy

technologies to reduce carbon emissions.

The health of the economic system will recover, and the GDP will increase by accessing to stable

political circumstances that motivates the government to invest more in improving the social

factors such as the education, innovation and human development regarding that, the country

gets well-educated workforces with high competitive skills comparing with that in the

developed countries. Furthermore, increasing the social awareness about climate change and

the necessity to work toward the energy efficiency that raises the promotion of the PV

technologies. The economic growth creates new business opportunities with a positive impact

on the unemployment rate, inflation rate and the exchange rate.

The last factor is the technology, the technological trend is to adopt the cost-efficient PV

products that do not exist in the local industry, but there is a willingness to encourage investor

to localize the PV products that will take at least five years to build highly advanced production

facilities and compete with the international one.

3.1.5. Opportunities from PEST analysis

Sustainergy should exploit the following opportunities:

1. Increase the demand on the PV technologies thanks to the flow of the foreign investment

that will finance the large-scale PV projects and create chances for Sustainergy.

2. The new set of regulatory frameworks for the PV sector to incentivize the EPC and flourish

the PV market.

3. The modified business taxation policies that compensate the taxes payers by improving

services in return to support their businesses activities such as introducing facilities to own

lands and issuing licenses that will reduce the bureaucracy and motivate the companies to

work with passion.

4. Control the corruption by activating the rule of law to increase the reliability and

transparency that all impact the health of the economic system. As a result, Sustainergy can

implement the strategic plan and use the competitive advantages against amateur and

professional player on the market.

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5. The low labour cost, whereas the installation of the SSL is required low skilled electrical

technicians.

6. There are no local manufacturers for the components of SSL & SPS; hence, the demand will

be covered by exporting. The government issued new legislation to optimize export trading;

additionally, they revised the customs clearance cost.

3.1.6. Threats from the PEST analysis

Sustainergy should avoid the following threat

Low control of corruption and the deactivation of the regulations by the bureaucracy are the

worst political factors that impact negatively on Sustainergy business model because the

absence of control leads to unfair competition and loss of opportunities. These defects waste

the efforts of Sustainergy and the other systematic players and become an advantage for the

weak competitors in the market.

3.1.7. Actions toward exploiting the opportunities and avoiding the threats

Sustainergy should exert great efforts at the beginning by building business relations and

getting approval on Sunmaster products from the ministry of renewable energy. That will

facilitate winning tenders and generate a profit on the short run; therefore, the company

proliferates resulting an excellent reputation in the Egyptian SSL market that enables the

company to upgrade the business model shortly to participate in other PV applications focusing

on projects with high installation capacity. On the other side, Sustainergy should find

alternatives, considering the worst-case scenarios. The best solution to overcome the threat is

diversifying the company portfolio by operating in Egypt and the GCC countries in parallel; the

company can operate beyond the domestic market thanks to the alliances with Italwarmi and

Sunmaster. In case, there is an occurrence of adverse changes in the Egyptian market

circumstances, Sustainergy can sustain by operating in other marketplaces.

3.2. SWOT analysis

3.2.1. Introduction of SWOT analysis

The SWOT analysis usually follows PEST analysis, and they have factors in common. The

difference is that the PEST analysis investigates the significant picture factors that might

influence a strategic plan, market circumstances, or a potential new business. SWOT analysis

explores the determinants factors of the business relations, product line or the product itself.

These tools complement one another and are using together.

SWOT analysis focuses on Strength, Weakness, Opportunities and Threats. The identification

of the strengths and the weaknesses correlated to the organization capabilities to compete in

a specific environment, the other two determinants, address the circumstances in which the

company operate. All the factors are linked together in the sense that it helps the decision

makers in exploiting the strengths to convert the opportunities into real benefits and identify

the weaknesses to progress them and expect what precisely the future threats are. This SWOT

application included not only the strengths and weaknesses of Sustainergy, but it also indicated

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the weaknesses and strengths of the PV market in Egypt, which impact the opportunities and

challenges that the company may face.

Regarding the market research in chapter one, the conclusion is the following SWOT analysis

in Egypt.

3.2.2. Strengths of PV market

1. The massive amount of solar irradiation thanks to the geographical location of Egypt that

supports the idea of practically adopting the PV technologies in addition to the necessity to

supply the rural areas with the electricity.

2. The PV systems are flexible to be installed in the remote area with no need for the

connection with the national grid or invest in the electricity infrastructure such as cable

expansion and civil work.

3. Low maintenance & operating cost compared with conventional energy resources.

4. Egyptian PV regulatory framework such as the FIT stimulates the public and the private

sector to invest in the PV projects.

5. There is no local PV industry; the project procurement relies on importing the PV products.

3.2.3. Strengths of Sustainergy

1. Cost leadership strategy that gives Sustainergy a competitive advantage against the

competitors.

2. Exclusive agreements with Sunmaster and Italwarmi to promote SSL products.

3. Agency agreement with Amerisolar and Canadian solar that increase Sustainergy bargaining

power as a buyer when participating in SPS projects.

4. Adoption of the vertical integration, Sustainergy responsible for all the stages of the SSL &

SPS projects (site inspection, design, procurements, installation, commissioning, operating

and maintenance).

5. Strategic alliances with Hammer Egypt one of the roles played in the PV.

3.2.4. The weakness of the PV market

1. Lack of awareness about the environmental issues which is one of the energy efficiency

barriers.

2. Information asymmetries and low accessibility to the data related to the benchmarking.

3. FIT law disactivated since October 2017, leading to a decrease in the investment.

4. Lack of logistics supports to implement wide-scale projects in remote areas.

5. High initial investment cost.

3.2.5. The weakness of Sustainergy

1. The new entrant in the PV market; thus, Sustainergy should exert many efforts until building

projects reference and increase the reputation.

2. The business model based on the agreement with Sunmaster; therefore, in case Sunmaster

faces loss or failure that will negatively impact on Sustainergy.

3. Sustainergy has weak technical capabilities to implement SPS projects.

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3.2.6. Opportunities for Sustainergy

1. Increasing the demand for the PV projects’ consultancy.

2. Increasing the demand for PV products.

3. The demand increasing creates a high competition; however, the exploitation of this

demand increases the growth of sales.

3.2.7. Threats for Sustainergy

1. Any disagreement with Sunmaster will affect negatively on Sustainergy business model.

3.2.8. Recommendations

1. Sustainergy and Italwarmi should search for new alternatives considering the worst-case

scenario of Sunmaster failure or disagreement.

2. Sustainergy should strengthen the technical capabilities of the SPS design and keep

improving the SSL sector.

3. Put all the efforts to start big and undertake many SSL projects and reinvest in the business

development to overcome the weaknesses and overcome the challenges.

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3.2.9. Conclusion of the SWOT analysis

POSITIVE FACTORS NEGATIVE FACTORS

Strengths Weaknesses

Company

• Cost leadership strategy.

• Strategic Alliances.

• Vertical Integration.

• Agency & Exclusivity agreements.

Company

• New entrant in the Egyptian PV market.

• Independency on Sunmaster.

• Low technical knowledge about SPS.

Market

• Huge amount of solar irradiation.

• Flexibility of the PV systems.

• Low M & O costs.

• PV regulatory framework.

• No Local industry.

Market

• Leak of awareness about EE.

• Information asymmetries.

• FIT deactivation.

• Lack of logistics support to remote

areas.

• High initial investment cost.

Opportunities Threats

• Demand increase on the PV

consultancy.

• Demand increase on the PV

products.

• High market potentiality.

• Any disagreement with Sunmaster will

affect negatively on Sustainergy

business model.

Figure 35: conclusion of Sustainergy SWOT analysis.

SWOT

EXTE

RN

AL

FAC

TOR

S IN

TER

NA

L FA

CTO

RS

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4. Chapter Four (Competitive advantages strategies)

4.1. The engines of growth

4.1.1. Exploitation of the engines of growth

Italwarmi & Sustainergy can exploit the engines of growth as the following:

1. Memorable experiences: contacting all the customers registered in the CRM system and

discuss with them the feedback correlated to their experience with Sunmaster products and

service. This resource makes the company better understand its customers’ needs.

2. Analytics: gathering all the feedback information in reports and starting the analytical stage,

in which, takes the consideration of every single detail about the products design, prices and

quality and the customer satisfaction about the technical consultancy and the customer

services. The result of the analytical process enables the decision makers to reduce the

uncertainty and make them confidently take the right decisions that add value to the

company.

After applying the previous steps, the following remarks have been concluded:

Remark 1: the result was positive in some points such as the prices and the high quality of

the customer service. Most of the customers have indicated that the prices are reasonable

compared with many competitors, and by doing a benchmarking and periodically checking

on the leading competitors’ prices. Italwarmi has high skilled core competence, the company

hire dedicated employees in the customer service department who speak different

languages which is an advantage for the international business, but on the other hand, the

customers complain about the leak of their technical knowledge.

Remark 2: the customers’ feedback was cynical about the quality and the design of some

LED fixture modules. Based on the negative and positive feedback, it is the turn to exploit

the suitable alternatives from the engines of growth to enhance the weaknesses and sustain

the development of the positive points.

3. Product innovation: by starting with the solution for the design and low quality, the product

innovation is the best engine of growth to be used to serve the development of the design

and improve the quality. Recently, sunmaster was manufacturing a variety of LED fixtures,

and the modern Chinese industry is producing different qualities, low and high depending

on the customer budget which is very wrong management style that leads to adverse effects

on the company’s reputation and reliability. Thus, the solution is to focus only on the highly

demanded LED modules and kick out the low demanded one from the product range. After

that, the technical department works on increasing the quality of the concentric product’s

material for example, in the project case in Kuwait, Sunmaster offered the consultant die

casting aluminium material for the LED fixture instead on the traditional aluminium one.

Plus, HDG steel pole instead of the powder coating in order to withstand the weather

circumstances of the desert in Kuwait.

Additionally, dedicate a portion of the budget for designing a modern shape of the

integrated built-in solar lighting to fit the demand of the residential segment. Last but not

least, building a business relationship with a laboratory of a third-party to test the products

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and issue an accurate testing report to attach with the products’ technical data sheets, that

would increase the company reliability.

4. Unique hardware and software designs: the improvement of the documents’ structure is

one of the most effective actions that have a tremendous positive impact on customer

satisfaction. The restructuring and the modification of the technical data sheets templates,

price lists, catalogues, business profile and create a new version of the projects gallery as a

reference can increase the company reliability and attract the customer to contact

Sunmaster. On the other side, using great advanced software to create lighting calculations

such as the Dialux, makes the company introduce better and faster technical service.

Moreover, Sunmaster created software calculator to configure the SSL & SPS according to

the project specifications as described in the project cases.

5. Social Media: nowadays, the social media platforms especially Facebook and LinkedIn are

considered as appropriate communication channels to reach the customers and keep them

updated with all the latest news about the industry and the range of the products. Upgrading

the company’s online pages strengthens the branding and the company image.

6. Word of mouth: meeting the potential customers face to face eases to facilitate the

negotiation stage well and create customer loyalty to the company. Therefore, part of the

strategic plan is to engage with the customers in their countries to be more aware of their

business culture and participating on the ground in the project’s implementation phase

that’s also increase the company reliability.

7. Creation of growth hacking team: the engines of growth are variable, and new of them raise

by the time. Detecting the new engines of growth is relying on the company internal

competencies and the management team creativity. Thus, creating a hacking team gives the

company the accessibility and acquisition of new resources that sustain and enhance

company performance. Italwarmi has created a scouting team consists of four international

members (Indian, Colombian, African, Turkish) who are responsible for doing market

research, discovering new creative tools and studying the market in India and the Far East,

South America, Africa and Turkey.

4.2. Competitive advantage

Pros of the competitive advantage

Strategies serve to any organization or individual in a competitive environment. In any strategic

plans, the competitive advantage is used to be one of the most influential factors in any

company that makes an entity’s goods or services superior to all a customer’s other choices.

There are three main determinants should be considered in any business model to pursue a

competitive advantage.

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• The benefit: it is the value added to the customer makes him reach satisfaction by using the

company’s product or service which should be extremely reflected on the value proposition

section of the company business model to make it more competitive.

• Target market: is representing the targeted customers and their needs, that makes the

decision makers more precise in the key resources utilization and wisely identify the

company objectives and the key activities to reach them in a cost-efficient way.

• Competition: the first step toward winning a competition, the company should recognize

the competitors and define their weaknesses and strengths, that has happened in the

benchmarking with one of the most prominent players (SOL) in the SSL sector. The

benchmarking included the products range, the prices, the quality and the technical service

that the competitor introduces on the market.

Briefly, the successful business model shows the ability to articulate the introduced benefits to

be provided to the target market in a better way than the competitors, delivering this clear idea

to the customers is necessary to increase the company reliability. Traditionally, the company

can achieve a competitive advantage by implementing one of three porter’s generic strategies:

cost leadership strategy, differentiation strategy and focus strategy.

4.2.1. Cost leadership strategy for Italwarmi & Sustainergy

The most suitable competitive strategy fits with Sunmaster, Italwarmi and Sustainergy business

model is the cost leadership strategy that seeks competitive advantage in a low-cost position

achieved through aggressive cost reduction and high market share. The sources of the

competitive advantages are:

- Economies of scale

- Economies of learning.

- Process technology and process design.

- Product design.

- Input cost.

- Capacity utilization.

- Management organizational efficiency.

4.2.2. Cost leadership and Porter’s five forces

• The threat of new entrants: cost leadership strategy considering as an entry barrier that can

frighten off the new entrants due to their needs to enter on a large scale in order to have

cost competitive.

• Bargaining power of buyers: the cost reduction strategy can decrease buyer’s power by

driving prices far below competitors, causing them to exit in case of the participation in the

private projects or to lose and quit during the tender’s RFP evaluation but after that shifting

power with buyers back to the company.

• Bargaining power of suppliers: this competitive advantage strategy can mitigate suppliers’

power by:

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- Being able to absorb the suppliers’ cost increases due to low-cost production after

dominating the market and increase the growth of sales.

- In the case of the company reach a significant market share, they can make large

purchases, reducing the chances of suppliers using power.

• Substitutes: this step should be agreed between Sunmaster and Italwarmi Joint venture

because it concerns investments in order to create substitutes. Cost leadership strategy is

well positioning to:

- Buy patents developed by potential substitutes that already done when Sunmaster has

acquired the LED chip patent of Philips instead of Bridgelux to optimize the position after

the US-China war economy.

- Lower prices to keep value position.

• Existing competitors: can use a cost leadership strategy since competitors avoid price wars

with cost leaders, creating higher profits for the entire industry. The success of this

determinant has been approved practically by rewarding the project in Kuwait (Salem Air

Force Base) against GE, Phillips and Sol who have avoided the price war.

Remark: the positive result of cost leadership strategy is shown theoretically, in the

benchmarking case and practically, in winning the project in Kuwait against big lighting

manufacturers such as GE, Phillips and Sol.

4.3. Strategic Alliance concept

It is a collaborative agreement between two firms who have decided to share their resources a

sharing benefits project. The strategic alliance imposes on both parties’ lighter responsibilities

than in the joint venture agreement. In case two companies adopt the Strategic alliance

collaboration, each of them remains his management structure but gains mutually new

opportunity.

4.3.1. Advantages of the strategic alliance

A strategic alliance supports the companies to introduce better their value proposition by

compensating their weaknesses by sharing the internal resources and competencies that’s

make firms offer a more practical value, can snowball into a new market, or get superiority and

competitive advantage over an opponent. The collaboration allows the two businesses to work

toward a mutual objective goal that will raise a short-term or long-term benefit to both. The

benefits may be formal or informal between the two parties. Through the informal alliance, the

firms stop gaining benefits at the end of the partnered business period within the

responsibilities of each member are clearly defined.

The Purpose of Strategic Alliance

The aims of adopting a strategic alliance are achieving fast growth while entering a new market

and reaching potential accessibility to acquire new resources and knowledge that one of the

parties has not before.

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4.3.2. The Risks of Strategic Alliance

There is a potential risk correlated to the interest conflict between the two parties; this risk

likely happens in the informal strategic alliances more than the formal one. In the adoption of

a long-term strategic alliance, probably one of the parties becomes more dependent on the

other, which may cause additional friction as obtaining one side advantage. Therefore, it is

better to go through the formal agreement in which all the collaboration terms are well defined

and recognized by each party. Further, in case it is necessary that one party provides

proprietary information to the other, there must be trust between the two allies.

4.3.3. Applications of the strategic alliance theory in Italwarmi & Sustainergy BMs

Practically, the strategic alliances appeared three times in the business models, twice in the

new business model of Italwarmi and one time in Sustainergy business model.

• The first time, when Italwarmi created an informal strategic alliance with (KB development

SRL) as a technical consultant partner for the PV power plant and the installation stages of

the SPS in case the customers asked for technical supervision on the project’s installation

stage until the handover. The agreement has been issued before the business trip to Saudi

Arabia, the mutual benefit is to enter a new potential market for the two parties and It

generates a beneficial bargaining power for Italwarmi while discussing with the companies

and representatives from the government the opportunities to participate in the power

plant projects with a substantial installation capacities. On the other side, KB developments

will get new opportunities outside their national boundaries without taking a risk in the

sense that Italwarmi will charge all the business trips cost and takes the negotiation

responsibilities with the customer.

• The second strategic alliance is a formal agreement that has signed between Italwarmi as

an exclusive international representative of Sunmaster based on a joint venture agreement

and (Bait Al-Aseel) as a contractor company in Kuwait. The agreement states that Italwarmi

has to exclusively support Bait Al-Aseel commercially by supplying very competitive prices

with high-quality solar street lighting components and technically through building the

lighting design and the solar system configuration additionally, providing the installation

instructions for Salim air force base outdoor lighting facilities project.

• The third strategic alliance is a formal agreement between Sustainergy as a first party and

Hammer Egypt as a second party. The second party is an EPC company specialized in the PV

sector, particularly in the solar street lighting applications. Regarding this agreement,

Sustainergy, as a startup company in the Egyptian PV market, needs support through

collaborating with Hammer Egypt at the beginning to easily reward projects through tenders

or even participate in private projects. Hammer Egypt will gain a competitive price

advantage in the equipment procurement of the SSL & SPS from the bargaining power of

Sustainergy thanks to the integrated partnership with Italwarmi.

All the previous strategic alliances have been implemented practically and generated positive

results for all the parties. These agreements facilitate the success in all cases thanks to the

flexibility of the strategic alliances because they avoid all the hurdles that a joint venture would

include, and the parties do not need to merge capital thus there is no financial risk, and they

remain independent of one another.

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4.4. Benchmarking

4.4.1. Introduction of the Benchmarking

The concept behind the benchmarking is to compare two companies that have points of

similarities, and they should operate in the same industry and work in the same market

circumstances. Therefore, the opportunity to do the benchmarking raised within the

competition in the project of Salim Air Force base in Kuwait between Sunmaster, GE, Philips

and (Sol Inc) and all the data available about the companies to create a reliable benchmark.

There are three types of the benchmarking (Internal, strategic and competition).

Herein, the purpose of the benchmarking is a step forward to win the competition, the

company should recognize the competitors and define their weaknesses and strengths based

on the technical and commercial data.

Philips and GE are manufacturers of only LED fixtures, and some of them produce batteries and

controllers. Nevertheless, no company from the previous produces all the SSL components such

as poles, cables, batteries, battery boxes, controllers, cables and solar panels. Sunmaster is

adopting the vertical integration modern economic theory, they have the manufacturing

facilities for LED fixtures, Solar panels, Poles, Controllers, battery boxes and collaborate with

sister companies as a family business to supply batteries and cables. That gives Sunmaster a

competitive price advantage upon the big players in the lighting industry but make it impossible

to full benchmark with them.

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4.4.2. Comparison between GE and Sunmater

As shown in the (table 9) a comparison between GE and Sunmaster covers the price and the

technical parameters of the LED fixture product. The conclusion refers to the highly competitive

advantage for Sunmaster over GE from commercial and technical perspectives.

During this competition in Kuwait, Sunmaster faced one of the biggest brands that have

production facilities for LED fixture and solar panels. Sol Inc is a company that has a reputation

in the solar lighting industry with 20 years’ experience. They offer technical consultancy for the

designing and the installation stages as Sunmaster does. In the (table 10), the result of the

benchmarking between Sunmaster and Sol, the comparison is included the technical and

commercial aspects. In the technical perspective, Sunmaster has superiority on Sol for the main

proposed components, for instance, the LED fixture, Battery and solar panels, further the

lighting design and the system configuration are more reliable and efficient than Sol. Sol has

offered only 219 Pcs of single arms at a price five times higher than Sunmaster one which is

technically and economically insufficient.

Comparison Statement

GE Vs Sunmaster

No

Parameters

GE

SunMaster

Remarks: SunMaster are specialized

only in manufacturing of Solar

streetlights components such as

LED, PV, Pole, Controller and

battery box for more than 10 years’

experience.

1 Luminous Flux >8600lm > 11000lm 65W Lamp Test Report attached

Sunmaster lamp is higher in LED

efficiency, brighter with the lower

power consumption; Direct current

is much safety; and the color

temperature is flexible regarding the

project requirements.

2 LED efficiency >110lm/w >180lm/w

3 Color

Temperature 5000K 4000K

4 The electric

current AC DC

5 Power Factor >0.9 >0.98

6 Fixture material Aluminum Di-Casing Aluminum &

Anodized Aluminum

Attached in the catalogue

specifications.

7

Weight

10Kgs

6Kgs

Lighter material is better lower

mechanical stress on the pole in case

of the high wind.

8 LED chip brand Undefined USA Bridgelux Letter of certification by Bridgelux

attached.

9 Price 339USD 114USD

GE price is 3 times higher than the

price of Sunmaster, thanks to the

adoption of leadership strategy.

Table 9: benchmarking between GE Vs Sunmaster.

Source: Sunmaster technical data sheet, price lists, GE technical data sheet and prices.

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4.4.3. Comparison between Sol and Sunmaster

Parameters SOL Sunmaster Remark

1 LED Chip Brand CREE USA Bridgelux

Letter of certification by Bridgelux

attached. The lifespan of the Bridgelux

chip is longer than the Cree brand.

2 Luminous Flux 3,692 lm >11,000 lm 65w Lamp and the testing report

attached, Sunmaster’s lamps are

higher in LED efficiency, and produces

more lumens than Sol’s one with the

same electricity consumption.

3 LED efficiency 130 to 165 lm/w 170 to 210 lm/w

4 Color Temperature 3,000 K 4,000 K

5 The electric current Alternate current Direct current

6 Power factor Undefined >0.98

7 Fixture material Aluminum

Die Casing &

Anodized

Aluminum

Die Casting and Anodized strengthen

the Lamp fixture and make it

withstand with the high temperature

circumstances in the Kuwait. The Lamp

catalogue and specification attached.

8 8m HDG Pole Full Hot Dip

Galvanized

Full Hot Dip

Galvanized

Complied

9 Wind resistance

Based on speed

145Km/Hr

Based on speed

162Km/Hr

The wind resistance of Sunmaster pole

is better in sense that the project in

and open desert area with high wind

turbulence speed. Thus, Sunmaster’s

pole is safer.

10 panel Undefined 150 w poly

150w solar panel is enough for the

project requirement as explained in

the project case study

11 Battery Ni-Cd GEL Battery

Ni-CD cannot resist the high

temperature in Kuwait and each cell

has 1.2V so to get 12v for one battery,

it must include 10 cells connected in

series and the charging will be slow

because too many connections.

12 Battery position Underground On the top

The battery position on the top is

better because it requires the cables

between the solar panel, the battery

and the LED lamp to be shorter than

the storage position underground.

Thus, the is no electricity loss for the

top position.

13 Price (complete Set) 4,263USD Single

arms

722USD Single arms

979USD Double arms

Sunmaster prices is 5 times cheaper

than Sol prices which negatively

impacted on the project total budget.

Table 10: benchmarking SOL Vs Sunmaster. Sources: Sunmaster technical data sheet, price offer, Sol Inc technical datasheet and price offer.

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The conclusion from benchmarking Sunmaster with Sol and GE confirming that Sunmaster has

very potential business chances and highly competitive advantages and they can gain a

considerable reputation followed by a good position in the GCC market and get a significant

market share.

5. Chapter five (Italwarmi & Sustainergy Business Models)

The idea came out after one-year work experience as a freelancer with Italwarmi in the SSL &

SPS applications. Within this period, I have gained a proper technical & commercial knowledge

which motivated Italwarmi on behalf of Sunmaster to hire me as a business developer and

regional sales manager to work on the upgrading of Italwarmi business model for getting a 33%

sharing from Italwarmi’s net profit. The aim of the business model is the expansion of the

company activities in the Middle East and reaching significant sales growth. Italwarmi is an

international intermediary for Amerisolar and has a joint venture agreement with Sunmaster.

5.1. Business Model Canvas

It is a visual chart consisting of nine blocks that describing the company value proposition,

infrastructure, customers segmentation and the financial structure to help in increasing the

creativity and flexibility while improving the competitive structure of the business, managing

the multichannel marketing opportunities and help the management team to overcome the

decision making complexity.

Applications of BMC

1. Understanding and sharing the status-quo: facilitate to capture, understand, visualise,

communicate and share how Italwarmi and Sustainergy compete involving all the actors

such as debtholders, shareholders, and the stakeholders.

2. Analysis: analyse Italwarmi and Sustainergy business logic by observing, measuring the

company’s performance and show how they are linked together as partners.

3. Benchmarking: comparing the status quo of the two companies and the competitors.

4. Management: thanks to this methodology, managers can set the strategic plan easily in a

creative way and react to the external changes in a flexible way.

5. Prospect: it supports future development by reducing, market uncertainty and support

taking related decisions.

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5.2. Italwarmi Business Model

The business model represents how Italwarmi works, describing the value the firm offers to

one or more segments of customers, the structure of Italwarmi and its network of partners for

creating and delivering this value.

Figure 36: Italwarmi Business Model.

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Customer segment: there are several players in the global PV energy market such as EPC, ESCO,

Constructions, Lighting and contracting companies; therefore, Italwarmi addresses different

customer segments based on two main parameters (the business strength and the project size).

The business strength characteristics are the market share, turn over, reputation. On the other

side, the project size classifying on the required quantity for the project, moreover the

reputation of the End User, for example, the participation in projects related to Ministry of

defence, ARAMCO and Royal Commerce in Saudi Arabia.

Based on the previous map Herein the customers classification:

• High potential: since the focus activity of Sunmaster is the manufacturing of SSL. As a fact,

the lighting companies with an expert business profile are the high potential customers

besides, EPC and ESCO. The big companies concentrate on the big projects that lead to the

supply of a massive quantity of PV products.

• Intermediate potential: lighting companies with intermediate or low business profile and

participate in big size projects. In this situation, the best solution is to support the companies

technically, in case they have the willingness and motivation to participate. However, big

firms with small projects, collaboration with them is essential to build a profitable business

relationship for future projects.

• Low potential: the companies as mentioned above with a shallow business profile and

submit to small size projects in this matter, supporting them is good for the potentiality in

the future.

Value proposition: Italwarmi increases the profitability to Sunmaster as the leading partner,

further Amerisolar, Canadian Solar as a support regarding non-exclusive agency agreements

and adds value to the customers by offering the very competitive prices, technical support in

the power systems design, configuration, installation and facilitate the communication with the

logistics companies in China.

In particular, Italwarmi supports the key partners to reach the following:

• Increasing the growth of sales.

• Maximisation of the profitability.

• Enhancing the reputation by focusing on the big projects.

• Creating close business relationships with the customers.

Figure 37: Trade off the projects regarding project size & the business strength.

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Channels: Italwarmi could reach segmented customers through communication channels as

the following:

• Indirect communication: Emails, telephone, Skype and others.

• Direct communication: making business trips in the status of having a high potential

customer with a big project.

Customer relationship: Italwarmi is creating a tense relationship with potential customers as a

supplier with highly advanced technical assistance. Using two types of customers assistance:

• Personal assistance: inwhich the customer can interact directly with the Italwarmi

employees in the pre-purchasing, purchase and post-purchasing stages.

• Dedicated assistance: for big companies in the Middle East, there is a possibility to interact

with the customers in Arabic to be more confident in clarifying their project specifications.

Revenues stream: the main revenue stream of Italwarmi is 5% commission from the total

amount of each order from Sunmaster, 0.01 $/Wp from Amerisolar, 0.01 $/Wp from Canadian

solar.

Key resources: Italwarmi achieves its objective regarding the accessibility to the following

resources:

• Financial resources: investing the cash inflow as revenues from the sales growth of

Sunmaster, Amerisolar and Canadian Solar.

• Technological resources: including several technologies such as (Office, PC, Internet and

telephone).

• Human resources: Italwarmi has highly skilled professional employees with willingness and

capability to increase company performance.

Remark: Itawarmi has a diversified product portfolio that gives the company the

advantages of sharing of resources, sharing of competences, similar target markets.

Key activities: Italwarmi can achieve the objectives through these remarkable activities:

• Sustainable communication with the customers:

- Doing a registration in the CRM system and sending them periodic emails like advertising

and newsletters to keep the customer updated with the new products and product

developments.

- Automatic following up emails after sending them the price quotations.

- Calling the customers by phone or web conference to increase the reliability.

• Digital marketing: the marketing strategy is creating various online marketing tools on the

Sunmaster and Amerisolar platforms to attract more customers. The tools are:

- Launch an online course: the course contents illustrate all about the SSL to increase the

new entrant’s knowledge because one of the barriers is the lack of technical knowledge.

The online course is consisting of 30 Episodes reviewing all the technical details and

parameter of each component, how to do the design, and how to do the installation.

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Thanks to this course, the reputation of the company increases and the traffic on the

Sunmaster platform is going up.

- Ask an expert service: it is a problem-solving service that the customer can go through

in case he has any urgent technical inquiries. It is a low-cost service 100 USD.

- Articles blog: writing technical articles about the PV applications and the new

opportunities then published on the website blog, which makes the website more

professional.

- Webinar: Recording a video about the company presentation and publish it on the

webinar.

- Platforms: creating short videos for Social Media platforms such as (LinkedIn, YouTube,

Facebook).

- Improvement the documentation: the routine activity is sending the customer the price

offer with the technical data sheets. The improvement process is aiming to restructure

the form of the documents, especially, the technical data sheet, the catalogues and price

lists as a very crucial issue to send a precise, reliable, accurate technical details about

each component of the SSL and indicate all the technical parameters to facilitate the

technical evaluation from the customer side.

- Business profile: continuously updating the business profiles and the companies’

presentation, including the design and the content of the documents.

- Projects reference: creating a projects gallery, including the big projects that have been

done by the company. Explain all the project details such as the project specifications,

the project location, the main partners and real images for the installation and the

operations activities.

Key partners: Italwarmi establishes tight partnerships with shareholders and stakeholder

partners in the sense that the main factors of any business sustainability are good business

relations and professional communication skills. The key partners of Italwarmi are:

• Sunmaster: a Chinese company released in 2006 with more than 13 years’ experience in the

solar lighting industry with a production capacity 500,000 sets SSL per year. The company

has a turnover 35000000USD in 2019 with around 80% from the domestic and the Indian

market.

• Amerisolar: an American company with several manufacturing plants in Far East countries

such as China, South Korea, Taiwan and Vietnam with production capacity 1200MW. The

company is a professional manufacturer of Crystalline solar panels, transparent and thin

films.

• Canadian Solar: founded in 2001 in Ontario, Canada, the company has manufacturing

facilities in Canada, China, Brazil and South East Asian countries, Canadian Solar now has 9

GW production capacity.

Cost structure: Italwarmi model is a value-driven business model; the principal objective is to

maximise the attractiveness of the key partners’ value proposition. Italwarmi faces the labour

cost, office facilities expenses and taxations.

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5.3. Kuwait Salem Air Force Base case study

Introduction

To participate in projects outside the company boundaries, Sunmaster has decided to go with

the strategic alliances with EPC, lighting and contracting companies in the project location to

facilitate the negotiations and the implementation phase.

Remark: Italwarmi is using the name of Sunmaster externally, but for administration

considerations in Italy, they are running as Italwarmi.

Sunmaster has implemented a solar street lighting project successfully in Kuwait through

creating a strategic alliance with Bait AL-Aseel lighting company in Kuwait. Who has an

excellent business portfolio in the local traditional lighting sector, but they have a lack of

experience in the execution of the SSL projects since the solar application is a new technology

in the Middle East. Their weaknesses were the key entrance to sign an exclusive project

agreement with them in order to assist them technically and economically by supplying Salem

Air Force Base project with a high-quality solar lighting product besides the technical

consultancy for the design and installation phases at a very highly competitive price against

Philips, GE and Sol Inc.

5.3.1. The project description

The project scope is the construction of the outdoor lighting facilities for two roads of Salem

Air Force Base in Kuwait based on the following dimensions:

- Road1 is 10 metres width divided into two lanes with a distance 10 Km.

- Road2 is 20 metres width included two parts with an island in the middle, each part is

divided into two lanes with a distance 7 Km 800 metres.

Sunmaster

Ministry of Defence

Dar Al-Handasa

(Consultant)

Leonardo Aerospaces

Bait Al-Aseel

(Lighting Company)

Figure 38: Salem air force base project’s stakeholders.

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5.3.2. Determination of the project configuration

Based on the dimensions as mentioned above, the technical department determined the

system configuration concerning the following steps:

1. Using the configuration formulas to identify the suitable pole height, LED fixture height and

the pole distance as noted in the screenshot of the Excel sheet.

2. Determination of the LED power from the down table.

Pole height (m) 3-4 4-5 5-6 6-7 8-9 10-12

Led power (Watt) 5-20 10-30 20-40 30-40 50-80 60-120

Table 11: choosing the optimal LED wattage. Source: Sunmaster technical department.

Figure 39: result from the excel sheet of the initial lighting configuration. Source: Sunmaster technical department.

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3. Measuring the Solar Irradiation by using http://re.jrc.ec.europa.eu/pvgis.html

and insert the exact project location, accordingly, getting the average solar irradiation per

day. Identifying the lowest amount in the following chart then divide on 30 as the average

number of days per month over the year. In this project case, the average amount of solar

irradiation is 164/30= 5.4677 Kwh/m2/day.

4. Estimating of the solar panel output, battery capacity and the controller amps by using

Sunmaster specialized software calculator as pointed in the figure. The designer input the

loading data such as required lamp power, the number of days' autonomy of the battery

backup and the lighting hours per day. Usually, Sunmaster prefers to design the system

based on 24v as optimal operating voltage better than 12v because the 24 voltage in more

efficient and the power loss is lower than in 12 voltage system.

Figure 40: solar irradiation chart of the project location in Kuwait. Source: solar GIS maps.

http://re.jrc.ec.europa.eu/pvgis.html

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5. Finally, the approval of the configuration by using the Dialux Software: this software can

smoothly design the lighting for different applications such as whole building, emergency

lighting, the interaction between indoor and outdoor scene and road lighting. It gives an

accurate distribution of the light to avoid any distortion or allocating dark points between

the two lighting points and detect any deviation or faults in all the four previous steps.

Figure 41: screenshot of Sunmaster configuration software. Source: Sunmaster technical department.

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As shown in the figures, the Dialux identify the accurate Luminous flux, the wattage, the lamp

overhang and the pole distance.

Figure 42: the Dialux of the Double Arms. Source: Sunmaster technical data sheet.

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Remark: The configuration formula assumed that the optimal pole distance is 27m; on the

other hand, the Dialux determined 24m to the best choice configuration is 24m.The colour

rendering is an important parameter to ensure the right lighting distribution on the road

considering the determined distance between two lighting points and the width of the road.

As specified in the colour rendering figures, the accuracy of the lighting distribution and the

non-existence of any dark points along the road.

Figure 43: the Dialux of the Single Arms. Source: Sunmaster technical data sheet.

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Figure 44: the color rendering of the Double Arms. Source: Sunmaster technical data sheet.

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Figure 45: the color rendering of the Single Arms. Source: Sunmaster technical data sheet.

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Regarding the previous calculations, the configuration of the systems for the two roads are:

• Road1: a quantity of 404 single arm solar lighting sets.

• Road2: a quantity of 287 double arms solar street lighting sets.

Figure 46: road dimensions for the Single Arms. Source: Sunmaster technical department.

Figure 47: road dimensions for the Double Arms. Source: Sunmaster technical department.

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5.3.3. The Lighting configuration

Both roads have the same components of technical specifications as the following:

1. Fixture Model: STL42-65W.

2. LED Lamp: 65w/24v, 1pcs,4000k, Bridgelux LED chip >170lm/w, die casting Aluminum with

E-coat epoxy primer finish and powder topcoat to withstand the desert circumstances,

colour code is RAL7046.

3. Solar Panel: One piece of Poly-Crystalline solar panel 150w/36v.

4. Battery: Gel type 60Ah/12v, two pieces with free maintenance, Working Time: 10-

12hours/day and two backup days.

5. Pole: 8M height, Q235 steel hot dip galvanized, with bracket lamp arm and solar panel

bracket.

6. Wireless Solar Controller: Zigbee wireless remote control, one Piece of MPPT controller

10A/24v and protection code IP68. The End User has requested a smart management

control system to use it in the emergency cases such as night air strike attack; hence, they

can switch off the light by one click.

7. Battery Box: Galvanized steel on the top pole installation.

8. Cables: Complete set for the wiring and the connection between all the components is plug

and play to facilitate the installation activity.

9. Color code: RAL70469.

Figure 48: project wiring diagram for the SSL components. Source: Sunmaster technical department.

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In the above diagram, is showing one of the facilities that Sunmaster provides to the customer

to expedite the installation stage in a case that the customer will do the installation

independently. After the handover of the project, the customer asked for 200 Pcs single arms

as a project extension, and Sunmaster successfully supplied in the meantime.

5.4. Market players of SSL & SPS

The availability of financial and technical resources are the main drivers for the implementation

of energy efficiency projects. Since the EPC companies can compensate for the scarcity of the

technical capabilities for the targeted customers, EPC model is the best organisational structure

to start up in the energy industry addressing the Egyptian market and the GCC region in a later

stage. The main activity of EPC is providing solutions to overcome the production obstacles and

increase consumption efficiency. In the production aspect, the company addresses the solar

applications through supplying and implementing SSL and SPS projects in the residential,

commercial and the industrial sectors on the other side; the EPC introduces energy efficiency

measures to the industrial sector especially for the SMEs who are suffering from scarcity of

technical and financial capabilities.

5.4.1. Stakeholders identifications

A stakeholder analysis is a fundamental process to determine whose interests should be

considered when developing and implementing SSL & SPS projects. The managers can use this

analysis before starting a new project to detect potential barriers and the direct & indirect

benefits through the visualisation of the overall interactions between the different actors in

the project.

In the public tenders, the chief stakeholder of the EPC is the public institution who decides and

assign EPC the SSL projects. However, in the private projects, the procedures are much more

comfortable, and the timeline is shorter because the customer has better financial capabilities

than the PI and may go directly to a trustable EPC which has a professional business profile with

excellent projects references.

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EPC has internal and external stakeholders who play essential roles to get the project

accomplished that is going to be deeply explained in the project phases section. The following

part points out all the stakeholders in the EPC model and how the PI selects an EPC who

participates in the public tenders.

5.4.2. The evaluation processes

The process of selecting an EPC involves identifying potential partners, requesting proposals,

conducting in-depth analysis and evaluation of the EPC’s business profile to identify the best-

qualified EPC for the execution of the SSL project.

This selection of an EPC occurs through an RFQ & RFP process that compares the qualifications,

services, and pricing offered by multiple candidates. Firstly, the PI initiates the RFQ process

then, the interested EPCs submit their corporate resumes, business profiles, experience, and

initial plan. Once received, the PI creates a “short list” of 5-8 companies. This list is composed

of the companies whose profile best matches with the PI needs in the RFQ. Later, the PI asks

for an RFP that is a much more detailed explanation of the project.

This document contains all cost savings measures, products, M&V plans, and the performance

contract. The RFP process aims to inform the EPCs as early as possible with all the requirements

the PI may have regarding the scope and technical approach of the project. The PI objective is

to select the most well-suited EPC to implement the project precisely and to provide the

desired services in terms of the cost & technical criteria. The chart below outlines the typical

process used to select an EPC.

EPCInternal Stakeholders

- Owners.

- Managers.

- Empolyees.

External Stakeholders

- Public Institution.

- Manufacturers.

- Consultants.

- Sub-Contracting.

- External Investors.

Figure 49: stakeholders of SSL & SPS projects.

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The PI hires a selection committee for the period of the RFP process, which applies the

evaluation procedures, generally makes the selection of the winning proposal and criteria set

in the RFP. Thus, earlier in the RFP development process, and as an EPC, it is important to

determine who will join the selection committee to decide the most convenient criteria that

may be used to evaluate the proposals. The selection committee includes consultants that have

experience and participated in some similar existing projects, other members from the PI and

other interested stakeholders.

The committee evaluates EPCs’ initial proposals based on comparing the relative strength of

each proposal in terms of technical approach, experience, qualifications of the pricing and

compliance with other requirements submitted in the RFP. At this moment, the full

specification of the project is yet to be determined, and it is reasonable to give the criteria

relating the EPC’s qualifications and experiences a higher score in the evaluation than the

financial offer, which remains uncertain.

On the other side, the PI should introduce details about the project specifications and the data

that help the candidates to create a perfect project management plan and enable them to

decide the warranties, payment terms, on-going verification, and operations.

By analysing the proposals, evaluating on these criteria and giving scores to each category, the

hired committee can select a short list of the top-ranking proposals.

The final step in the selection process is to determine which top-ranked EPC can provide the

right solutions to reach the project achievement and meet the users need. After reviewing the

proposals, the selection committee evaluates the submitted solutions through an interview

with one or more of the top ranked EPCs. The most used approach for this interview is to

prepare one set of questions for all candidates, addressing any inquiries that remained

unsolved after reviewing the proposal. When the evaluators interviewed and scored each

interviewee, a combined score from the proposal and interview can be used to determine the

top-ranked EPC. For this reason, often, samples of previous work, contacting past companies

to get their feedback and a particular review of key personnel experience can be used to decide

whether the EPC has successful experience working with similar projects. Additional

confirmation of qualifications involves documentation from performed projects, client

feedback, and proof of the firm’s financial and organisational stability.

Issue RFP

(PI)

Host Pre-Meeting

(PI)

Site Visit

(EPC)

Evaluation of the proposal

(PI)

Assignation of the contract

(PI)

Figure 50: SSL & SPS projects tender process.

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5.5. The project phases

Once the EPC and the PI stipulated the contract, the project phases start. Here are summarised

the different phases of the project with the related activities carried out by the EPC.

Figure 51: project management phases.

5.5.1. Project Development

1. Energy Auditing (Ask an expert): once an EPC rewarded to perform an energy audit, EPC

and the PI sign initial contract. The scope of this agreement is to interpret the reach of the

audit and to set a minimal cost for executing the investigation, also noting the payment

terms. Typically, the cost of the energy audit is covered in the total financed amount if the

project proceeds through implementation. The energy audit is to be done through site

inspection, gathering of data, analysis of data and finally, the identification of the cost and

energy savings opportunities.

2. Feasibility analysis: the feasibility study is often provided by EPC as a free of charge to scope

the potentiality of implementing the energy savings projects. Often, these initial project-

scoping reports include as a part of a response to the RFP issue.

3. Contracting (Performance-Based Contract): it is the most convenient agreement between

the PI and EPC to implement the SSL or SPS project that aims to achieve the best available

solution with the highest cost efficiency. The two parties negotiate together to define the

terms & conditions of the project, and the contract declares the duties and rights of both. It

represents the framework the EPC will head through, identifying how they will implement

the project phases. The performance measurement phase remains across the time horizon

of the contract in which both parties can save their rights. Besides, this contract includes

payment terms.

Regarding the several types of Performance-Based Contract, the most appropriated types

for the implementation of the projects are:

• Guaranteed saving contract: they are the most common form of Performance-Based

Contracts and are widely used by the PI in case, the project is a replacement of the

traditional lighting technologies with SSL technologies. These contracts are characterised by:

- A term with a fixed payment schedule in which the EPC accomplish certain project stages.

- Financial resources typically provided by the PI.

- EPC would have no added benefit if savings estimates exceeded in case that the

implemented project is the replacement of traditional lighting system.

Project Development

ImplementationPerformance

MeasurementHandover

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• Shared saving contract: this type less frequently using than guaranteed saving contract, the

PI and the EPC share cost savings from the project in case that the implemented project is a

replacement of traditional lighting systems. This type is characterised by:

- Arrangements vary, but EPC gets a constant share from the saving that increases or

decreases over the time regarding the contract.

- The EPC typically provides the equipment procurement cost until covered by the PI after

a maximum period of 90 days from the equipment delivery.

- Both the EPC and the PI may obtain an additional monetary benefit if there is exceed

savings.

• Standard contract: this contract usually is using in the implementation of new SSL projects

in new areas where is no existence of the lighting systems before and it includes terms as

the following:

- Payment terms and condition.

- The warranties of the equipment and the performance of the system.

- Delivery time of the procurement equipment.

- The project timeline the execution stages.

- The project handover.

- Penalties for each party in case of deviation from the contract terms.

4. Designing & Engineering: throughout this stage, designers work to reach the most

appropriate design of the system. This design mainly based on the circumstances of the

project that will be provided by the PI and the data included in the energy audit report

collected within several visits to the project location. All these data should match with the

safety standards and the project budget.

5. Financing: the PI usually does not have enough financial resources to fund the entire SSL

projects, for this reason, they assign the difficulty of financial resources to the banks or to

the EPCs who have the capabilities to diversify the financial resources, increasing the

number of funds.

The source of financing can vary, and financial resources are often provided by large

institutional lenders, although in some cases the lowest share of capital may come from the

PI and the highest share from the EPC. Additionally, the structure of the debt may diversify

by the EPC financing experience; in some contracts, they allow the financing to be excluded

from the balance sheet and not accrue towards their debt limits.

• Self-Financing (PI capital): the PI full funds the project by outsourcing the budget from

external financiers or internal budgets or both. This financial structure is better for EPC and

reduces their financial risk.

• EPC financing: in many cases, an EPC provides funding for a project from their capital to get

in a return within 90 days from starting the project execution. This type is most commonly

an option when working with service providers; however, most of the EPC arrange third-

party financings like bank loans or private investors.

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5.5.2. Implementation phase

1. Equipment Procurement & Installation: once the contract rewarded, the EPC finalises the

design, purchasing the equipment, and works on the installation of the equipment stage.

2. Commissioning: the EPC is doing this stage to guarantee the effectiveness of the equipment

and the system configuration, ensuring that the design matches the project targets.

Commissioning is typically performed by the EPC, but the PI may address an independent

commissioning agent as a consultant.

3. Operations & maintenance: O&M activities are essential to keep on the guaranteed savings

and the system efficiency over a specific time noticed in the Performance-Based Contract.

The PI or the EPC is responsible for the O&M activities, and they are a source of cost savings

due to avoiding the expenditures for equipment repairing or equipment replacement

regarding the technical faults.

4. Facility management: the EPC provides training to the operators on the new technology

including operating and maintenance issues, how to interact with any normal faults directly

and solve it without losing time and, resulting, a cost reduction.

5.5.3. Performance measurement

1. On-going operations & maintenance: ensuring the continuous O&M after implementing the

Performance-Based Contract is necessary to sustain the savings related to the lower energy

consumption. It is necessary to plan and manage these activities to guarantee that adequate

staff is highly trained to perform and solve the faults at any time.

2. Periodic measurement and verification (M&V): initial savings verification activities may

include surveys, inspections, spot measurements, and short & long-term metering. The

project will be accepted after these commissioning and savings verification activities have

been completed. M&V has the advantage to:

- Quantify energy savings from a project.

- Monitor equipment performance.

- Ensure savings persist and identify additional savings.

- Verify proper O&M.

- Verify cost savings and performance guarantees are meet the customer objectives.

3. Technologies performance: equipment performance is another crucial factor to optimise

energy consumption and reach the optimal savings. The EPC is responsible for maintaining

the high performance of the technologies, they have to assure that the improvements meet

the expected performance levels and the targeted saving. Therefore, preventative

maintenance activities can positively impact the performance and life cycle of the

equipment.

The EPC does that by initiating M&V plan declares the responsibilities to reach long-term

high performance, including who holds repairing the broken components or equipment. In

case the equipment life is shorter than the contract period, it is considered scheduling

replacement in the financial plan.

The M&V plan should also define how the performance is testing, and what are the

procedures if performance does not meet expectations or if inadequate preventive

maintenance impacts performance.

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5.5.4. Handover

After passing all the previous stages successfully, the project will be closed out at the end of a

Performance-Based Contract; accordingly, all financial commitments between the PI, the EPC

and the financiers will be resolved. Project handover typically occurs at the end of the planned

performance period but may occur earlier if EPC terminates the project for convenience.

Since one of the main barriers for the implementation of this project is the scarcity of capital

income, technical knowledge, and accessibility to financial resources, PIs turn to address to

EPCs. Most of these companies, indeed, have the capabilities and experiences to overcome the

economic and technical barriers by providing the best available solution.

Remark: In the procurement stage, Sunmaster and Amerisolar will play a central role to support

the EPC as a startupper company by providing very competitive prices and LC payment terms

within 90 days limit, in addition to their high-quality brand with a global reputation.

5.6. Startup introduction

After getting the profitable result within six months since the initiation of Italwarmi’s

developed business model, the idea of

releasing an EPC company in Egypt raised by

investing part of the 33% profit from

Italwarmi. Consequently, I started to create

a new business model for Sustainergy as an

EPC startup to operate in SSL & SPS sector in

Egypt. Italwarmi collaborated Sustainergy as

an accelerator, offered all the services and

assistance such as office, technical service,

sales force, and networking with potential

partners. Italwarmi will obtain a profit in

return by increasing Sunmaster &

Amerisolar growth of sales in Egypt and

been able to participate in tenders through

Sustainergy. After an evaluation stage in the sense that if Sustainergy business model reaches

success in Egypt, both parties will expand the operating in the GCC through upgrading the

existing business model to fit the new marketplace circumstances.

5.6.1. The Startup theory

“The startup is a temporary organization in search of scalable, repeatable, profitable business

model” Steve Blank. Which means that the startup is not a smaller version of a large company.

It is a flexible business model that passes through a transition stage into a company due to

scaling up and repeating the activities that lead to maximising the profits. When the startup

grows and becomes a company, it changes the management team, switching from initial

entrepreneurs to senior managers.

67%

33%

Shareholders

Italwarmi Egytalia

Figure 52: profit share between Sustainergy & Italwarmi.

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The search The execution

of of

the business model the business model

5.6.2. The lean startup methodology

The lean startup splits the startup into two phases: Search and execution.

1. Search: this stage includes two activities:

• Customer discovery:

- Market segmentation by customers.

- Understanding each segments’ problems and needs.

- Focusing on the high potential customers to generate maxim profit.

- Sustainable development of low potential customers and support them for

future collaboration.

• Customer validation:

- Create a sustainable business model that fits with the market circumstances and

internal capabilities.

- Test the business model if it does not work, pivot and iterate the process.

- If it works and generates profits, start future development.

2. Execution stages:

• Customer creation:

- Build a stable relationship with the customers for long term collaboration.

- Monitoring the performance of the business model.

- Build demand through marketing and sales.

- Scale up the business.

• Company building:

- The transition from startup mode.

- Customer development team.

- Function department.

CompanyTransitionScalable Startup

Figure 53: Startup Process Stages.

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5.7. Sustainergy Business Model

Based on the above-mentioned theory, the startup is built on the following business model.

BMC is representing Sustainergy as EPC company, describing the value that the company offers,

Identifying the main partners, key resources.

Figure 54: Sustainergy Business Model.

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Customer segment: Sustainergy addresses different customer segments Like:

• Industrial sector: by trying to approach all the industrial companies, especially, SMEs who

do not have enough financial and technical capabilities to operate efficiently.

• Commercial sector: including agricultural companies, hospitals and shopping malls.

• Residential sector: focusing on the private & public construction companies in Egypt.

Value proposition: Sustainergy adds value to the segmented customers over introducing

designing, budgeting, supply, execution of the SSL & SPS projects. Furthermore, providing

energy solutions to all the industrial sectors companies to diminish their energy consumption

efficiently. In particular, the company reaches all the sustainability aspects as:

• Environmental: by decreasing the lighting pollution, carbon dioxide emissions and

degrading energy consumption from fossil fuel.

• Economical: raise the energy saving, which results in reducing the operating cost, besides,

lessen the financial risk of the investment for the PI that has a scarcity of technical & financial

resources.

• Social: improving the traffic and users’ safety, progressing the security and upgrading the

outdoor architectures of the cities, moreover, creating new job opportunities over time.

Channels: Sustainergy could reach easily segmented customers through:

• Communication Channels: Italwarmi is practising a robust digital marketing plan and

utilising various marketing tools (online courses, word of mouth, exhibitions, project

references, publishing customers feedback, online technical articles, business trips). Besides

considering that Sustainergy will follow the same tools independently.

• Direct contact: by (phone, E-mail, meetings) with the main stakeholders to manage

negotiations about specific deals & agreements, in particular with:

- The customers to arrange and confirm the Performance-Based Contract.

- Creditors (banks or external investors) to increase financial resources.

- Designers to formalise the layout of the project.

- Manufacturers & Supplier to purchase the project equipment.

- Co-contractor to execute the installation & maintenance plans.

• Distribution Channel: which represent in delivering all the physical requirements to the

project location such as (LED lamps, solar panels, sensors, cables, junction boxes, poles,

switches, batteries). The company will do this part by collaborating with a logistics company.

Customer relationship: there two cases in which Egytalia to build business relations with the

customers:

• Execution of SSL & SPS projects: after rewarding the project through RFD & RFQ, the

relationship between the two parties will be developed via:

- Co-creation: negotiating with the customer to define suitable terms of the

Performance-Based Contract for both.

- Formal agreements: officially signing the contract.

- Direct action: initiating the agreement while starting the project stages.

• Supply SSL & SPS projects: Egytalia builds a stable relationship with the customer by:

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- Offering the project design for free.

- Offer special prices based on the quantity.

- Offering the online course free of charge as a promotion for high quantity orders.

Revenues stream: there are three revenue streams:

• Commissioning fees from selling Sunmaster products as an exclusive agent in Egypt plus,

Amerisolar and Candian solar panels as an intermediary agent.

• Revenues from Installation and execution of SSL & SPS projects.

• From the energy audit and introducing energy solutions to the SME.

Key resources: Sustainergy achieves its aim thanks to the following necessary resources:

• Financial resources: the company can build its financial plan based on crediting bank loan,

commissions from Sunmaster & Amerisolar, customers budget, and Private investors.

• Technological resources: Sustainergy is adopting several technologies, for instance (LED

fixtures, solar panels, batteries, poles, mounting structure, foundation kits, and cables).

• Human resources: such as designers, technicians, operators, consultants, and engineers.

Key activities: Sustainergy does remarkable routine activities to achieve its goal through:

• Energy Audit:

- Identification of energy and related cost saving opportunities.

- Estimating solar irradiation.

- Measuring the road dimensions.

- Measuring the installation area (SPS project).

• Designing & Engineering: the creation of the construction layout, the LED wattage, the

power of the solar panels, the battery capacity, the pole height, and the wind resistance,

the distance between the lighting points and the battery position.

• Financial plan: diversifying the financial resources to increase the budget.

• Equipment Procurement: purchasing the required equipment from manufacturers &

suppliers.

• Installation & Commissioning: both start in the implementation phase consequently.

• Operations & Maintenance: starting the activation of the lighting system accordingly

monitoring and detecting faults to fix it.

• Facility Management: introduce specialised training for operators regarding the advanced

technologies of the smart control system.

• Performance Management: periodically measuring the LED lighting & the control system

efficiency besides calculating the amount of saving energy.

Key partners: Sustainergy establishes valuable partnerships with certain entities in order to

better introduce the service in a cost-efficient way.

• Manufacturers & Suppliers: Sustainergy has a strong relationship with Sunmaster and

Amerisolar who provide the SSL & SPS projects with the most effective technologies and all

the equipment at very competitive prices and reasonable payment terms such as a letter of

credits after 30, 60 or 90 days.

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• Consultant companies: Sustainergy should introduce their business profile, project

references and, the product samples to the consultant companies to be registered on their

vendor list and increase the company reputation rapidly.

• Public Institutions: for instance, (Municipalities, local authority, highway authority, Ministry

of Electricity, Ministry of renewable energy) that would provide the EPC with relevant and

specific data and information about the project circumstances.

• Creditors: who would supply the Sustainergy with the financial resources.

• Logistic company: who in charge of the equipment transportation from the port to the

project location.

• Lighting companies: by creating Strategic Alliances with them in the Middle East countries

as occurred in Saudi Arabia and Kuwait.

• Contracting Companies: The same collaboration of the lighting companies as with Marshall

International in Yemen and Green wave in Qatar.

Cost structure: Sustainergy has different expenses related to (Labours, designing the power

systems, installation cost, maintenance cost, operational cost, taxation and the cost of capital,

equipment costs, M&V cost, other ongoing costs).

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5.8. Case Study for the Higher Technological Institute in Egypt

Egytalia has started to focus on the private projects in Egypt until getting the approvals on

Sunmaster’s products from the ministry of renewable energy and electricity to allow

participating in the public tenders. Egytalia collaborated with the Higher Technological Institute

to implement a solar lighting project for the parking and the entrance areas.

5.8.1. Project description

Herein in the layouts, the result of the site survey by using the google map, the technical team

identified the dimensions (width and length) of the paths and the parking slots. Regarding that,

the designer followed the same designing procedures as mentioned in the Salem Air Force case

study to assume the suitable wattage and the pole height.

Figure 55: layout of the parking area. Source: Sunmaster technical department.

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In this application, The technical department recommended the Integrated lighting product

(All-in-one) over the split system because it is more economic sufficient, give better

architecture view for the university and more energy efficient due to the motion sensor that

dims the light during the low traffic period then goes brighter in the high traffic. The light sensor

is automatically switching on the light after dusk and turning it off after dawn. Furthermore,

Egytalia suggested WiFi security cameras for the 24 hours/day security video surveillance with

a low price that gives the ability to watch the range area from a monitoring room. The same

solar panel of the lighting set powers the cameras by only using 63AH battery capacity rather

than 42AH.

Figure 56: layout of the entrance area. Source: Sunmaster technical department.

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5.8.2. Project result

This table figures out the project feasibility analysis noticing 7,210USD as a net profit has been

generated from the project without paying taxes because the government set zero taxation

incentive in the first year for start-up companies that have been owned by youth under 35

years old.

An internal benchmarking between the split system and the integrated lighting pole has been

carried out to confirm which module is cost and technical efficiency to be adopted in the

parking zones and the small applications. As in the tables, the unit price of the single arms All-

in-one set is 530USD and the price for each lighting split system is 1,020USD, concluding that,

the price difference does have much impact on the total budget of this project due to the small

required quantity. However, the price range will show the customer preference to go with the

cheaper module in the significant quantity projects for the same applications hence, both

modules give the same technical performance even more, the integrated module has better

architecture design and more comfortable in the installation because all the components are

connecting together as a plug and play.

Factors Price offered $ Cost $ Profit $

Survey 0 0 0

Design 200 0 200

Sample 200 100 100

Procurement 15000 9340 5660

Customs clearance 300 300 0

Transportation 800 800 0

4 workers / 3 days 2000 1250 750

Crane Leasing / 3 days 700 700 0

Civil works 1000 500 500

∑Sum 20200 12990 7210

Table 12: feasibility analysis for HTI project.

Table 13: prices and technical specifications of the All in One. Source: Sunmaster price offer.

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5.9. Future development of Italwarmi & Sustainergy

All entrepreneurs seek business sustainability and new business opportunities. The company

should maintain business development by continually improving the company strategy, setting

new plans and Identifying new profitable objectives and entering new markets. Additionally,

undertaking activities toward innovative ideas in order to introduce new products and enhance

services.

5.9.1. Blue ocean theory

It is one of the advanced strategies that is using by managers to enter new markets beyond the

domestic demand boundaries through exploiting the first move advantage to discover new

markets and avoid the high competition in the exiting crowdy marketplace. The traditional

strategies are successful and adding value only in the existing market in which the decision

makers should trade off the cost reduction and adding more value for the products or the

service to reach the customer satisfaction and increase the growth of sales.

Nowadays, entrepreneurs think in a creative way outside the box by considering the following

principles:

- Creating or discovering unfought market space.

Table 14: prices and technical specifications of the split system. Source: Sunmaster price offer.

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- Make the competition irrelevant.

- Create and capture new demand.

- Break the value and cost reduction trad off.

- Align the whole system of the company’s activities in pursuit of the differentiation and

low cost.

The question is how to adopt this methodology in Italwarmi business model as future

development. The idea is after reaching well positioning in the GCC countries and Egypt in the

long run. The decision makers should consider the futuristic change of the circumstances in this

region. There are uncontested market spaces in three countries where many people in business

hesitate to expand their business activities and put efforts to enter these marketplaces because

they are unsecured areas and the market seems unstable. In Syria, Iraq and Yemen, there is a

huge business opportunity for all the applications of the PV sector. These countries are

suffering from lack of energy resources after the civil war, and most of their infrastructure and

energy utilities have been destroyed. The potential opportunities are correlating to the

necessary needs to rebuild the energy utilities under the supervision of international

organizations such as the United Nations. These countries seek to collaborate with the united

nations in the commercial and the technical aspects of the PV projects. The UNOPS started to

release many tenders for all the segments of PV sectors residential, commercial and industrial

to implement a vast installation capacity projects related to the SSL and SPS applications. These

markets are less competitive and have a huge potentiality.

The two categories of the blue ocean (formulation and execution) are under the structure to

be ready for the implementation at the mid of 2020 after finishing the market analysis in Syria,

Iraq and Yemen.

5.9.2. Product & Service innovation

Thanks to the highly advanced technologies that sunmaster adopt in the mechanical workshop,

the company can produce new high-quality product range such as solar built-in lighting pole,

carports, mountings solar poles for video surveillance, mobile solar power and solar power

cabinet. Based on Sunmaster’s manufacturing capabilities, Italwarmi and Egytalia can promote

new products on the market.

The development of the technical department is a crucial part of reaching product and service

innovation. Since the service that the company introduce is a technical consultancy, and

product innovation are relevant to the product design, the quality of both will increase by

enhancing the technical skills of human resources. That might happen by hiring high skilled

designers, technicians and engineers or through introducing training programs to the

employees. Product and service innovation will be the responsibility of Sunmaster, Italwarmi

and Egytalia. The three parties will participate in the development by sharing the resources

according to their competencies and the availability of the resources for each.

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5.9.3. Energy efficiency service

More ambitious toward the future, Egytalia is considering a creative idea of expanding the

company activities comprises introducing energy efficiency technical consultancy covering the

energy consumption aspect in the industrial sector. Egytalia will plan to enhance the technical

skills by building energy efficiency team that enable the company to proceed energy

assessments and energy audit services and introduce energy efficiency solutions through the

adoption of the best available cost-efficient technologies in the market.

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Engr.Mahmoud Ali, Philips price and technical quotation).

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