FINANCING AGREEMENT

The European Community, hereinafter referred to as "the Community", represented by the Commission of the European Communities, hereinafter referred to as "the Commission",

of the one part, and

The Association of Southeast Asian Nations (ASEAN), hereinafter referred to as "the Beneficiary", represented by the Secretary-General of ASEAN,

of the one part,

Whereas the Cooperation Agreement between the European Community and Indonesia, Malaysia, the Philippines, Singapore and Thailand, member countries of the Association of Southeast Asian Nations signed on 7 March 1980 in Kuala Lumpur, and extended to Brunei Darussalam on 16 November 1984 and to Viet Nam on 14 February 1997 hereinafter referred to as the “Agreement”, provides for financial and technical cooperation with ASEAN in the pursuit of its objectives;

1. The project described in Article 2 shall be implemented in accordance with the Financing Agreement, the General Terms and Conditions set out in Annex 1 and the Technical and Administrative Conditions in Annex 2 which form an integral part of this Agreement.
   
   

2. The Financing Agreement and the Technical and Administrative Conditions amend or supplement the General Terms and Conditions and, in the case of conflict, take precedence over the latter.

The Commission shall provide a grant to contribute to the financing of the project referred to below :

Project number : ALA/97/0464
Title : EC-ASEAN COGEN
Programme

Hereinafter referred to as "the project" which is described in the Technical and Administrative Conditions in Annex 2.

The total cost of the project is estimated to 250 million euro.

Community financing shall be not more than 25 million euro.

The Agreement shall run for 5 years.

The Community’s financial commitment shall remain valid until 31 December 2005 for the final settlement of outstanding invoices by the Commission.

The beneficiary shall contribute not more than 225 million euro to the project.

Where all or part of the Beneficiary’s contribution is in kind it shall be specified in this present agreement.

Correspondence relating to the implementation of this Agreement should be marked with the number and title of the project and be sent to :

(a) for the EUROPEAN COMMUNITY

Commission of the European Communities
SCR - Common Services for External Relations
200, rue de la Loi
B-1049 Brussels
Belgium

(b) for the BENEFICIARY

The ASEAN Secretariat
Programme Coordination and External Relations
70 A Jl. Sisingamangaraja
Jakarta 12110
Indonesia

This Agreement shall be drawn up in triplicate, two for the Commission and one for the Beneficiary, the three texts being equally authentic.

This Agreement shall enter into force on the date on which it is signed by the Parties. Any Party may rescind the Agreement by notifying the other Parties in writing. In that case, it shall continue to apply in respect of the obligations deriving from agreements or contracts concluded under this Agreement.

In witness whereof, the undersigned representatives, duly empowered to this effect, have signed this Agreement.

(Date) 29 July 1999 (Date) 13 September 2000

FOR THE EUROPEAN FOR THE BENEFICIARY COMMUNITY

Annex 1 : General Conditions

Annex 2 : Technical and Administrative Conditions

The Community’s commitment for the project, which is specified in the Financing Agreement, shall determine the level of the Community’s contribution.

The Community’s financial commitment must be implemented by the time limit specified for the project in the Financing Agreement.

If the Financing Agreement stipulates that the implementation of the project requires the beneficiary to make a financial contribution, disbursement of the Community contribution shall be conditional on the beneficiary’s obligations being fulfilled.

Cost overruns are incurred where, at the time the contract is awarded or the estimate for a project is drawn up, the amount of a contract or estimate exceeds the initial budget.

Cost overruns are also incurred where, in the course of implementation of a contract or estimate, as a result of an increase in the volume of work or change or adjustment to the project, taking into account the known or likely impact of price variations, the costs provided for in the contract or estimate, including contingency reserves, are likely to be exceeded.

Any cost overruns shall be borne by the beneficiary.

Once it appears that cost overruns are likely to be incurred, the beneficiary shall inform the Commission and notify them of the measures which they intend to take in order to cover such cost overruns, either by reducing the scale of the project or calling on his own resources.

If the project cannot be scaled down or the overruns cannot be covered by the beneficiary’s own resources, the Commission may, exceptionally, at the beneficiary’s substantiated request, adopt an additional Community financing decision. If the request is approved, the relevant costs shall be financed, without prejudice to the relevant Community rules and procedures, by an additional contribution to be set by the Commission.

TITLE II - IMPLEMENTATION

The project shall be implemented by the beneficiary in close collaboration with the Commission in accordance with the provisions of this Agreement.

The Head of Delegation shall represent the Commission vis-a-vis the beneficiary’s government for the purposes of implementing this Agreement and in respect of the funds for which the Commission acts as authorizing officer.

1. Where appropriate, the beneficiary shall authorize and validate any expenditure covered by this Agreement against appropriations committed by the Commission. The beneficiary shall remain financially liable to the Commission until the Commission clears the operations for the execution of which the beneficiary is responsible.
   
   

2. For payments in currencies other than that of the beneficiary’s national currency the Commission shall make direct payment for services provided.
   
   

3. For payments in the beneficiary’s national currency at least two accounts must be opened in the sole name of the project :

• one account in euro or in the currency of a Member State of the Community;

• one account in the beneficiary’s national currency.

These accounts shall be opened in the beneficiary’s country with a commercial financial institution recognized by the beneficiary and approved by the Commission.

4. The accounts referred to in paragraph 3 shall be replenished to meet actual cash requirements. Transfers shall be made in euro or, exceptionally, in the currency of a Member State, and shall be converted into the beneficiary’s national currency as payments fall due at the exchange rate applying on the date of payment.
   
   

5. Interest on the deposits in the accounts referred to in paragraph 3 shall be used exclusively for the project. The interest, which should be entered under a separate heading in the accounts, and the charges on these accounts shall accrue to or be borne by the project. However, the Commission’s prior approval is required before the interest can be used for the project.
   
   

6. At regular intervals, and, at least once every quarter, the beneficiary shall send the Commission a statement of actual expenditure and revenue, together with supporting documents. These documents and all accounts shall be kept for five years following the last date of payment.

1. Payments to contractors shall be made in euro, directly by the Commission, for contracts made out in euro. Payments for contracts in the beneficiary’s national currency shall be made in this currency.
   
   

2. Contracts signed under this Agreement shall be eligible for payment only if they have been concluded before the date of expiry of this Agreement. The last payment for such contracts must be effected no later than final date or financial commitments set in Article 3 of the Financing Agreement.

Notwithstanding Articles 12 and 13, works and supply contracts shall be awarded after open invitations to tender and service contracts shall be awarded after restricted invitations to tender.

1. Tendering procedures for works, supply and service contracts shall be open on equal terms to all natural and legal persons in the Member States of the Community and to all national and legal persons in the Beneficiary country.
   
   

2. For jointly financed projects, the Commission, treating each case on its own merits, may agree to allow nationals of countries other than the partner countries concerned to bid for tenders and contracts. In such instances, firms from third countries shall be eligible only if there are reciprocal arrangements.

The Commission and the beneficiary shall take the necessary steps to ensure the widest possible participation on equal terms in tendering procedures and in works, supply and service contracts financed by the Community.

To this end they shall :

• ensure invitations to tender are published far enough ahead in the Official Journal of the European Communities and the official gazette of the beneficiary’s country;
  
  

• remove any discriminatory practice or technical specifications which could prevent wide participation, on equal terms, by any natural or legal person referred to in Article 10.

Works and supply contracts shall be awarded on the basis of the general terms and conditions applying to such contracts and approved by the Commission.

Exceptionally, in urgent cases or where the nature, small scale or particular features of certain work or supplies warrant, the Commission or the beneficiary, with the Commission’s agreement, may authorize:

• contracts to be awarded on an open invitation to tender restricted to tenderers from particular geographical areas;

• contracts to be awarded on restricted invitation to tender;

• contracts to be concluded by direct agreement;

• contracts to be performed by direct labour.

1. For works and supply contracts, the beneficiary shall submit the tender dossiers for the Commission’s approval before invitations to tender are issued. On the basis of the decisions approved, and in close collaboration with the Commission, the beneficiary shall issue invitations to tender, receive and assess tenders, and select the successful tenderer.
   
   

2. The Commission shall always be represented when tenders are opened. She has the right to be present, as an observer when the tenders are assessed.
   
   

3. The Beneficiary shall submit the results of the scrutiny of the tenders and the name of the proposed contractor to the Commission for approval. With the Commission’s prior approval the beneficiary shall sign contracts, riders thereto and estimates and shall notify the Commission thereof. The Commission shall, it necessary, make individual commitment for contracts, riders thereto and estimates.

Individual Commitments shall take precedence over commitments under the Financing Agreement.

1. As a general rule, service contracts shall be prepared, negotiated and concluded by the Commission on the beneficiary’s behalf.
   
   

2. The Commission shall draw up, if necessary after prequalification, a short list of candidates on the basis of criteria which guarantee thequalifications, professional experience and independence of bidders, and their availability for the operation in question.
   
   

3. If express provision is made in the Agreement, the responsibilities referred to in paragraph 1 shall be delegated to the beneficiary with the Commission’s approval and under a representative’s supervision. In that case the general specifications for public service contracts financed by the European Community shall apply.

The procedures for service, supply and works contracts in the beneficiary country are set out in the Technical and Administrative Conditions to the Agreement (See tables numbers 1, 2 and 3 in Annex 2).

For each operation the Commission and the beneficiary shall ensure that the tender selected is the economically most advantageous in terms of the price of the services provided, costs, technical value, qualifications and guarantees provided by tenderers, and the type of the works or supplies and the conditions of performance. These criteria must be mentioned in the tender document and the notice of contract award.

Natural and legal persons participating in tendering and works, supply or service contracts shall be granted equal and provisional right of establishment and residence in the beneficiary’s country where this is justified by the nature of the contract. This right shall remain valid for one month after the contractor is selected.

Contractors and natural persons and members of their family whose services are required for the contract shall enjoy similar rights for the duration of the contract up to one month following the final acceptance of work performed under the contract.

The supplies required for the performance of works, supply and service contracts must originate in countries allowed to participate pursuant to Article 10, unless an exception is authorized by the Commission.

1. No tax, duties or other charges shall be financed from the Community’s contribution.
   
   

2. In context of the cooperation, the beneficiary government shall apply to contracts financed by the Community tax and customs arrangements no less favourable than those applied to the most-favoured State or most-favoured international organization.

The beneficiary’s government shall undertake to authorize the import or acquisition of foreign exchange required for implementation of the project. It shall also undertake to apply its national rules on foreign exchange on a non-discriminatory basis to the countries authorized to participate pursuant to Article 10.

If studies are financed under this Agreement the Commission and the beneficiary shall be entitled to use the data contained in such studies, and to publish it or pass it on to third parties.

1. Without prejudice to paragraph 2 any disputes which arise between the beneficiary and a contractor from a Member state, during implementation of a contract financed by the Community shall be settled, at the free selection of the contractor, in accordance with the conciliation and arbitration rules of the International Chamber of Commerce in Paris.
   
   

2. The beneficiary shall undertake to reach agreement with the Commission before a final position is taken on any request for compensation, irrespective of whether it is justified, from the contractor. If no agreement can be reached, the Commission shall not provide a financial commitment for any amounts granted unilaterally including those by the beneficiary.

The project shall be implemented in such a way to ensure maximum visibility for the European Community’s involvement at all times. Actions of communication and information shall be determined in close collaboration with the EC Delegation.

Special attention shall be devoted on implementing these rules at events in all public or official written material connected with the project. Objects, equipment and documentation connected with the project shall carry the European Community flag with the text in the language of the Beneficiary. The symbols identifying the European Community, shall be of the same size and appearance as any symbols identifying the Beneficiary, should the latter be present.

1. The Commission shall have the right to send its own agents or authorized representatives to undertake any technical, accounting or financial assignments it may consider necessary to monitor the implementation of the project.
   
   

2. The Court of Auditors, in the accomplishment of its responsibilities under the Treaty establishing the European Community, shall have the right to undertake a full audit, if necessary, on the basis of supporting documents of accounts and accounting documents and any other documents relating to the financing of the project and on the spot.
   
   

3. The beneficiary shall be notified if agents appointed by the Commission or the Court of Auditors are sent to the project site.
   
   

4. To this end the beneficiary:

• shall undertake to provide any information or documents requested, and to take any measures to facilitate the work of persons undertaking such audits;
  
  

• shall keep the dossiers and accounts required to identify the work, supplies or services financed under this Agreement and the supporting documents relating to local expenditure in accordance with the best accounting practice;
  
  

• shall assist the Court of Auditors, in the accomplishment of its responsibilities under the Treaties establishing the European institutions, in auditing the project’s accounts, if necessary, on the spot;
  
  

• shall ensure the Commission’s representatives can inspect any accounting or other documents relating to projects financed under this Agreement and shall assist the Court of Auditors in monitoring the use made of Community funds.

1. Any matter relating to the implementation or interpretation of this Agreement shall give rise to consultation between the beneficiary and the Commission. This procedure may, if necessary, lead to this Agreement being amended.
   
   

2. If any obligation under the Agreement is not met, the Commission may suspend financing after consulting the beneficiary.
   
   

3. The beneficiary may decide to withdraw wholly or partially from the project with the Commission’s approval.
   
   

4. Any decision taken by the Commission to suspend financing or by the beneficiary to withdraw totally or partially from a project shall be notified to all Parties in writing.

Any dispute between the Community and the beneficiary, arising from the implementation of this Agreement which is not settled by common accord by the Parties in due time, shall be settled by arbitration, in accordance with the Permanent Court of Arbitration’s Optional Rules for Arbitration involving International Organisations and States (La Haye).

Any communication or agreement between the Parties shall be recorded in writing giving the number and title of the project. This shall be sent by letter to the authorized addressee at the latter’s address. In emergencies, communications by fax, telegram or telex shall be allowed provided they are immediately confirmed by letter. The addresses shall be set out in the Financing Agreement.

Beneficiary : The Association of Southeast
Asian Nations (ASEAN)
Tittle : EC-ASEAN COGEN PROGRAMME
Project No. : ALA/97/0464

1. BACKGROUND

1.1. Origin of the Programme

The importance of the energy sector in relations between the European Union and Asia has been emphasised at meetings such as the Essen Council in December 1994 where the Commission was invited to put forward concrete initiatives within the framework of the “New Asia Strategy”. In Commission communications such as “Creating a New Dynamic in EU-ASEAN Relations”, the importance of this sector was also noted. In order to develop a co-ordinated strategy for this sector, the Commission prepared a communication to the Council, with the title “Europe-Asia Co-operation Strategy for Energy” which was presented in July 1996 by Vice-President Marin, Vice-President Sir Leon Brittan and the Commissioner Papoutsis. The “Europe-Asia Co-operation Strategy for Energy”, Brussels, 18.07.1996, ref. COM (96) 308 final, sets out the framework for the next phase of the EC-ASEAN COGEN Programme.

The European Parliament on 16 May 1997 voted a resolution on the Europe-Asia Cooperation Strategy for Energy which:

• expects the Commission to make punctual proposals and suggestions as to how energy ventures in Asia can be financed;
  
  

• welcomes the fact, given Europe-Asia Co-operation on Energy is a crucial issue, that the Commission has acknowledged the need to increase significantly the funding earmarked by the Community for this area.

The Energy Council adopted conclusions on the “Europe-Asia Co-operation Strategy for Energy” on 27 May 1997. Among these conclusions it noted that:

• the energy sector deserves special attention in the context of the relations between the European Union and its Member States on one side, and Asia on the other;
  
  

• the process of economic development in co-operating Asian countries calls indeed for special attention to be given to the elaboration of an adequate energy policy at both national and regional level;
  
  

• the strengthening of the Security of Supply in both the EU and Asia, the participation in the European industry in Asia’s energy market, and the protection of the global environment, are the main objectives for energy co-operation activities and programmes between the EU and Asia;
  
  

• energy co-operation between the EU and Asia should be targeted at modernisation of the electricity sector, promotion of natural gas, introduction of clean coal and combined heat and power technologies, promotion of energy efficiency and energy conservation, security of energy supplies to rural areas (in particular by an increased use of new and renewable energy), development of regional energy resources;
  
  

• in order to implement its strategy, the European Union should intensify the dialogue and target actions by means of increasing awareness and supporting the European energy industry.

1.2 Main Physical and socio-economic features of sector concerned

Due to the demographic and economic growth taking place in South East Asia, the demand for energy could double between now and 2005. This growth will have repercussions for EU in three areas : on security of supply (EU will be dependent on the outside world for 55% of its requirements in 2005 and 75% in 2015), on the EU energy industry (ASEAN already represents a significant portion of the world market) and on the global environment (protective measures implemented in EU will have only limited effect unless action is taken simultaneously in Southeast Asia).

1.3 Nature of problem to be addressed

One major problem to the adoption of clean and efficient technologies for energy conversion, is the lack of references in ASEAN. The key element which will convince an industrialist in ASEAN to install new equipment is evidence of similar equipment operating in real conditions, within the ASEAN region. The Programme will help to mobilise the private sector (which is being asked to play an increasingly important part in the energy sector because of the amounts of funding involved), while preserving the long-term public interest by taking into account the social environmental aspect of energy development.

II PROJECT DESCRIPTION

II.1 Wider objectives

The Programme will :

• enhance EU-ASEAN economic co-operation in the energy sector;
  

• strengthen the security of energy supply in ASEAN and EU;
  

• protect the global environment.

II.2 Specific objectives

More specifically the Programme will :

• raise awareness in ASEAN of proven, clean and efficient energy technologies from EU and increase awareness in EU of market opportunities in ASEAN;
  
  

• adapt institutional frameworks in order to promote technology exchanges and investment;
  
  

• support energy companies by mobilising EU and ASEAN investors and operators.

II.3 Expected results

In the short term, the Programme will establish the following results :

• business/investment flows generated;
  
  

• EU and ASEAN companies linked;
  
  

• enhanced facilities for access to financial sources;
  
  

• pollution abatement and fuel resource conservation;
  
  

• publications/databases on clean and efficient energy technologies, end-users, suppliers, private partners and public agencies.

II.4 Programme components

The Programme will focus upon the promotion of proven clean and efficient cogeneration technologies. The Programme will consist of the following components:

• implementation of full scale demonstration projects involving a contribution from the Programme towards the investment, training and monitoring costs;
  
  

• information dissemination and promotion of clean and efficient cogeneration technologies;
  
  

• technical, policy and financial seminars, conferences and study tours;
  
  

• feasibility studies;
  
  

• strategic studies;
  
  

• technological and policy training;
  
  

• financial packaging, networking and fund mobilisation;
  
  

• regular contact with equipment suppliers and installation owners, financiers and policy makers.

A more detailed explanation of the full scale demonstration project scheme is included at Annex A.

III. COST AND FINANCIAL ARRANGEMENTS

The total Programme cost is estimated at 250 million euro. The Commission shall contribute a total amount of 25 million euro, and the balance will be provided by the ASEAN private sector. The cost estimates are summarised (in million euro) as follows:

Input	EC	ASEAN	TOTAL
Technical Assistance, Tender in Europe	4.7		4.7
Technical Assistance, Expertise Contracted in ASEAN	5		5
Travel and Operating Cost	4		4
Equipment	10	225	235
Monitoring and Evaluation	0.3		0.3
Contingencies	1		1
TOTAL	25	225	250

A more detailed budget breakdown is included at Annex B.

Monitoring and Evaluation budget will be contracted directly by the Commission.

Contingencies can only be used after written agreement by the Commission.

The Programme is expected to be completed within a period of five years, following the signature of the Financing Agreement between the Commission and the ASEAN authorities.

The Community disbursements for the implementation of these projects will be executed after verification of the conformity of the expenses with the needs in the work programme and in accordance with the availability of annual budgetary appropriations.

IV. IMPLEMENTATION

IV.1. Organisation and management

The Asian Institute of Technology (AIT), Bangkok, Thailand, will be the Executing Agency responsible for the overall execution of the Programme. The following organisation and management structure will be established in order to execute the Programme.

A Programme Steering Committee (PSC), the function of which will be to:

• provide strategy and policy guidance to the Programme;
  
  

• supervise implementation of the Programme;
  
  

• recommend eligibility criteria for full scale demonstration projects to the European Commission for approval;
  
  

• endorse adaptations of to the Programme components during the Programme implementation;
  
  

• evaluate the performance and impacts of the Programme.

The PSC will comprise:

• as Chairman a senior representative of SCNCER;
  
  

• a SOME representive;
  
  

• a ASEAN Secretariat representative;
  
  

• other members justified by the competence of the institution they would represent (proposed by the ASEAN Secretariat and agreed by the Commission);
  
  

• the Programme Coordinator, who also acts as Secretary to the PSC;
  
  

• the European Commission as observers with the right to speak;
  
  

• AIT Secretariat representatives as observers;
  
  

• ASEAN Country Coordinator representatives as observers;
  
  

• European Focal Point representatives as observers;
  
  

• other observers on a case by case basis;

The PSC will be convened once every 6 months.

Reporting to the PSC will be a Programme Technical Committee (PTC), the function of which will be to:

• provide technical guidance to the Programme;
  
  

• adjudicate proposals for full scale demonstration project funding.

The PTC will comprise:

• the Programme Coordinator;
  
  

• AIT Secretariat representatives;
  
  

• ASEAN Counztry Coordinator representatives;
  
  

• European Focal Point representatives;
  
  

• The PTC will be convened every 3 months.

The function of the AIT secretariat will be to:

• undertake execution and coordination of the Programme at the ASEAN regional level;
  
  

• execute the implementation, training and monitoring of full scale demonstration projects;
  
  

• execute the implementation and management of COGEN databases.

ASEAN Country Coordinating Institutions for each participating ASEAN Member State will be subcontracted by AIT. The function of each will be to:

• undertake day-to-day execution of the Programme at the national level;
  
  

• participate in PTC/PSC meetings.

A European Focal Point will:

• provide a dedicated secretariat in Europe;
  
  

• provide marketing and technical guidance to the Programme;
  
  

• participate in PTC/PSC meetings;
  
  

• act as a counterbalance to ensure dissemination and the participation of the European Industry.

IV.2 Work plans and reporting

AIT Secretariat will produce a technical and financial work plan each year, for the duration of the Programme, taking into account the views of the PSC and PTC. This work plan will be submitted to the Commission for approval.

Routine documentation within the Programme will comprise:

• annual work plans and budget estimates;
  
  

• an annual report of activities, related to the approved work plan and a financial statement of expenditure;
  
  

• progress reports for each PTC meeting;
  
  

• audit reports.

In addition, the following specific documents will be submitted to the Commission for approval:

• an inception work plan within 3 months of start-up, approved by the PSC;
  
  

• supplementary (special) reports as requested by the Commission, such as a report after half of the Programme duration, as an input for the mid-term review, which details the work plan for developing a sustainable future for the Programme following termination of EC support;
  
  

• a final report on termination of EC support.

To prepare special progress reports, a part time monitoring and evaluation team will be recruited when needed, and will report directly to the Executing Agency, copying its reports simultaneously to the PSC and the Commission.

After agreement by the PSC, the Executing Agency will provide to the Commission copies of :

• inception work plan within three months following the start-up;
  
  

• annual work plans and budgets, after the first year, at least three months before the starting date of the period in question;
  
  

• any special progress reports, not later than 45 days following the close of the reporting period.

Progress reports and the annual and final reports shall be prepared in confirmation with standard formats provided by the Commission.

The final report will be provided to the Commission at the latest six months after termination of the EC financial support.

All documents and reports due to the Commission will be provided in English in five copies through its Delegation in Bangkok.

The short term experts, (e.g. for monitoring) will provide separate reports, normally at the end of each mission, for both the Executing Agency and the Commission as fixed at the time of drawing up the contracts.

IV.3. Technical assistance inputs

IV.3.1. Tender in Europe

Technical assistance to be provided through the tender in Europe will be as follows:

(i) AIT Secretariat based staff

The Programme Coordinator will:

• organise Programme Steering Committee (PSC) meetings;
  
  

• operate as a member of the PSC;
  
  

• oversee the implementation of any decision taken by the PSC;
  
  

• provide strategy and policy guidance to the Programme;
  
  

• coordinate activities of the Programme at ASEAN and EU level;
  
  

• liase permanently with the ASEAN and EC authorities participating in the Programme;
  
  

• provide the ASEAN and EC authorities with reports on the progress of activities;
  
  

• ensure that the terms of references of subcontracted expertise are honoured.

The experts in the fields of gas, coal and biomass fuels will:

• conduct a literature review on the potential market for clean and efficient cogeneration in ASEAN industries;
  
  

• identify the most relevant key industries where there is potential for cogeneration;
  
  

• prepare sectoral reports on the present status and potential of the cogeneration market in these key industries;
  
  

• prepare a technical report regarding available cogeneration technologies in Europe;
  
  

• assist in the expansion and modification of databases of the Programme;
  
  

• assist in preparing a directory of European cogeneration equipment and services;
  
  

• assess the technical capabilities of local equipment suppliers, and their relevance with respect to potential partnerships with European suppliers;
  
  

• advise potential customers on the selection of technology in relation with their objectives/requirements;
  
  

• review technical assumptions and provide technical advise/recommendations on business opportunities for cogeneration equipment;
  
  

• consolidate the existing model for techno-economic evaluation of clean cogeneration projects;
  
  

• undertake feasibility studies and techno-economic analyses;
  
  

• assist in the definition of technical criteria for the selection of full scale demonstration projects;
  
  

• participate in the adjudication and selection of full scale demonstration projects;
  
  

• follow-up of the contractual obligations of full scale demonstration projects beneficiaries during engineering, manufacturing, erection, commissioning and handing over phases;
  
  

• assist in the preparation of the terms of references of training and monitoring contracts related to full scale demonstration projects;
  
  

• assist in the supervision of the training and monitoring activities;
  
  

• participate in advertising activities (technical leaflets, visits, seminars,...);
  
  

• assist in the preparation of documents published by the COGEN Programme.

Environmental expertise will be necessary in order to:

• provide advice on environmental issues to industries where there is potential for cogeneration;
  
  

• participate in the adjudication and selection of demonstration projects;
  
  

• assist in the monitoring and evaluation of demonstration projects;
  
  

• develop an overall environmental plan for the Programme.

(ii) European Focal Point based staff.

The marketing expert will:

• act as the European Coordinator, and manager of the dedicated secretariat facilities in Europe.
  
  

• advise suppliers on their business strategy for South East Asia;
  
  

• assist in the expansion and modification databases of the Programme;
  
  

• disseminate business opportunities from South East Asia to relevant equipment suppliers in Europe;
  
  

• advise in producing promotional material published by the Programme.

The technical expert will:

• identify the appropriate cogeneration technologies available in Europe and that could meet ASEAN market requirements;
  
  

• prepare a directory of European cogeneration equipment and services;
  
  

• assist the expansion and modification of databases of the Programme;
  
  

• assist in the definition of the technical criteria for the solution of full scale demonstration projects;
  
  

• participate in the adjudication and selection of the full scale demonstration projects.

Additional staff to support the European Focal Point will also be recruited according to Commission procedures.

(iii) Part-time Expertise.

Part-time expertise will provide services in both Europe and South East Asia. This expertise will cover the fields of financing, information technology and communication, training and contractual /legal matters.

IV.3.2 Technical assistance contracted in ASEAN

Technical assistance to be contracted in ASEAN will be as follows:

(i) AIT Secretariat based staff.

Business/finance/marketing expertise will:

• provide advice to companies on key elements to consider in forming business partnerships (i.e. joint venture, licensing, etc.);
  
  

• assist companies in devising appropriate legal, contractual and commercial frameworks in forming business partnerships;
  
  

• provide advice on matters related to financial, economic and commercial aspects of projects;
  
  

• advise on the financial and commercial objectives of energy projects supported by the Programme;
  
  

• review the key revenues and the technical, financial and operational assumptions of projects;
  
  

• develop a general financial model and customize this model for individual projects;
  
  

• undertake financial analyses of projects and their sensitivity under various conditions;
  
  

• identify and comment on the key commercial and financial risks for the projects and advise on measures to mitigate these risks;
  
  

• assist the project developers in devising appropriate legal, contractual and commercial frameworks for the projects to allocate risks in an equitable manner;
  
  

• devise credit structures for the projects which meet the needs of the project developers;
  
  

• advise on the terms and conditions appropriate for the financing of the projects;
  
  

• prepare Project Information Memoranda for distribution to prospective lenders, guarantors and other sources of financing;
  
  

• assist in negotiations with prospective financiers in obtaining financing facilities which may include, but not be limited to, foreign and local currency loans and/or guarantee facilities and other types of financing such as swaps, convertible bonds and subordinated debt;
  
  

• organise a communication and promotion strategy for the Programme;
  
  

• develop relevant promotional material in order to help achieve the objectives of the Programme, such as raising awareness and replication of appropriate technologies;
  
  

• liase with media/press regarding promotion of the Programme;
  
  

• organise advertising activities (technical leaflets, visits, seminars,...).

Specific expertise in the field of information technology will be necessary in order to:

• modify and expand databases of the Programme;
  
  

• develop the use of the website of the Programme;
  
  

• integrate full use of the internet within operation of the Programme;
  
  

• develop the use of computer hardware and software.

Training experts will undertake the training campaign for each demonstration project. They will:

• assist in the definition of the training campaign;
  
  

• organise training workshop/seminars;
  
  

• produce detailed training materials (manuals, videos, etc.).

Monitoring experts will undertake the monitoring campaign for each demonstration project. They will:

• assist in the definition of the monitoring campaign;
  
  

• conduct detailed technical and economic monitoring;
  
  

• produce detailed monitoring reports;
  
  

• assist in producing promotional material presenting monitored performance of the demonstrating projects.

The accounts expert will:

• develop a management information system in order that the financial states of the Programme can be seen at all times;
  
  

• monitor status of the equipment fund for full scale demonstration projects;
  
  

• produce financial reports as required by the contractual frameworks of the Programme;
  
  

• liaison with independent auditors as necessary.

(ii) ASEAN Country Coordinating Institutions.

ASEAN Country Coordinating Institutions will act as focal point in each participating ASEAN member country and provide local expertise. Technical assistance to be provided on a national basis will be as follows:

• participate in the adjudication and selection of demonstration projects;
  
  

• assist in the definition and implementation of training and monitoring associated with demonstration projects;
  
  

• promotion of demonstration projects through newsletters, seminar/workshops, site visits etc.;
  
  

• provide documentation on a regular basis concerning trade fairs/exhibitions, tenders, energy/environment trends and regulations;
  
  

• maintain and update the databases of the Programme;
  
  

• organise field trips/study tours/site visits;
  
  

• maintain and develop contacts with all relevant public and private sector organisations;
  
  

• raise awareness of cogeneration as a clean and efficient energy solution.

Additional staff to support AIT Secretariat will be recruited in accordance with Commission procedures.

IV.4 Procurement

Tendering in Europe, will be organised by the Commission following EC normal procedures.

Local contracts (including support staff) shall be contracted by AIT according the standard procedures in accordance with tables 1, 2 and 3 attached to this document (or in any updates provided by the Commissions services).

The contribution of the Commission to the equipment of the full scale demonstration projects will be disbursed according to Commission procedures. The selection of full scale demonstration projects will be performed according to the technical reliability of the equipment, the financial and economical feasibility, the replicability and the energy-environment impact of the project. Precise eligibility criteria for full scale demonstration projects will be drafted by the PSC and sent to the Commission for approval.

V. MONITORING AND EVALUATION

The Commission shall be informed of the progress of the Programme by quarterly reports and by the Steering Committee. These reports, composed of an analytical part and financial part, will contain sufficient detail to permit judgement of the progress of the Programme in line with its objectives, approved work plans and corresponding budgets. A final report shall be submitted, including the details of its execution and its results and achievements. Independent monitoring including a mid term evaluation of the Programme will be conducted by suitably qualified experts.

VI. SPECIAL CONDITIONS

In order to ensure the best conditions for the execution of the contracts, the provision for facilitating the effective functioning of European Expertise signed with ASEAN countries will apply. This includes:

VI.1 Entry and residence facilities

Expatriate personnel taking part in works, supplies or service contracts and members of their immediate family, are permitted to enter the state of the Executing Agency, to work there and to leave the said state, as necessary for the execution of the contract.

VI.2 Import and re-export of equipment

Necessary permits will be obtained for the import and export of professional equipment required to carry out the project.

VI. 3 Taxation

Natural and legal persons from the EU countries, executing technical cooperation contracts financed out of the EU grant and seconded to AIT, Bangkok, Thailand shall be exempted from business and income tax in Thailand.

A Full Scale Demonstration Project (FSDP) can be defined as the implementation of a proven technology, on a full scale basis, in order to demonstrate its technical reliability and economic viability. Such a project therefore, constitutes a shop window, aiming to convince other potential end-users to select the technology.

Within the framework of the FSDP scheme, the project is co-financed by the Commission, up to 15% of the equipment cost (with a maximum ceiling at 400,000 euro per project), and by the end-user, who provides the remaining 85% and owns the equipment.

Adjudication of projects

Projects are proposed jointly by both the supplier and customer. The opportunity to participate is widely advertised in ASEAN and in Europe, and is open to any European supplier, and any ASEAN end-user. The projects are selected, according to four main criteria : technical reliability, financial and economic feasibility, replicability and energy/environment impact.

The contribution of the Commission (maximum 15%) towards to the equipment cost induces the funding of the remainder of the purchase price (minimum 85%) by the ASEAN customers. Therefore, the contribution of the Commission towards an FSDP immediately generates a much larger contribution from the other parties involved. Larger projects, for which the contribution reaches the maximum ceiling of 400,000 euro will increase cost effectiveness even further.

By definition, the demonstration projects are replicable. With effective promotion, the FSDPs should lead to additional purchases of clean and efficient energy equipment 4 or 5 times the original investment and possibly more. It means that the contribution of the Commission towards an FSDP could generate a total purchase of clean and efficient energy equipment of at least around 25-30 times the original contribution.

The 15% maximum financial contribution should not be seen as a subsidy, making the project feasible, the project must be financially and economically feasible without support of the Commission. The financial contribution by the Commission (and the associated contractual obligations) ensures access to the actual technical and financial data of the project. This allows promotion of the performance of the technology, especially through site visits by other end-users. Furthermore, it enables the measurement of the impact of the Programme, in terms of economic exchanges induced.

P/M = Person month