Four supplier proposals. One that the lender will sign.
A 50 MW / 100 MWh BESS procurement, walked end-to-end. The numbers, the framework, and the contract questions that decide where the money actually goes.
Sample deliverable. Suppliers shown as A / B / C / D. Numbers shifted from any specific KKME procurement. The brand list at the end is KKME's actual working set, distinct from the four anonymised suppliers in this memo.
What the developer asked for.
A renewable infrastructure developer, lender already in the room. Four-supplier RFQ, three weeks to selection, twelve-year design life. The job: get a contract that makes the lender comfortable and the equity sponsor confident the protection lines up with the price.
What came back was not yet comparable.
Four proposals, four different price baskets. Different Incoterms, different SOH bases, different bundling of PCS and MV. Headline €/kWh ranged from €71 to €119 — most of that gap was measurement, not value.
Same scope, same Incoterms, same yardstick.
Each supplier responds on a single template. KKME's. Round 2 issues four private gap lists — same questions, no cross-leakage — and demands the answer in the units that the lender's model uses.
Equipment and logistics, line by line.
Once the four are normalised, the headline DAP price spreads from €8.3M to €11.7M. The €/kWh nameplate spread tightens from 56% to 33%. Most of the original gap was measurement — what's left is real difference in scope, chemistry, and bundling.
CAPEX DAP — normalised, by category
| Item | A | B | C | D |
|---|---|---|---|---|
| Battery layer (DC) | ||||
| Battery containers | €6,520,00016 × 6.25 MWh | €7,350,00019 × 5.65 MWh | €7,140,00021 × 5.02 MWh, bundled | €6,820,00021 × 5.02 MWh, bundled |
| €/kWh DC equipment | €65.2 | €68.7 | bundled | bundled |
| PCS + MV layer | ||||
| PCS units (5 MW × 11) | €2,920,000EU PCS direct | €3,180,000EU PCS bundled | bundled | bundled · string PCS |
| MV transformer + SWG | in PCS unit | skid · €420k | €460,000 | €440,000 |
| Logistics, customs, regulatory | ||||
| Freight (DAP) | €110,000 | €124,000 | €352,000 | €264,000 |
| Customs duty (2.70%) | €265,000 | €292,000 | €202,000 | €232,000 |
| F-gas declaration | €3,200~16 ctn × €200 | €3,800~19 ctn × €200 | €4,200 | €4,200 |
| EPR / recycling (LT) | €248,000€2.5/kWh × 100 MWh | €252,000 | €245,000 | €256,000 |
| Commissioning | ||||
| Cold + hot + SAT | €82,000 | €124,000 | €78,000 | €238,000 |
| CAPEX DAP — total | €10,148,000 | €11,745,000 | €8,481,000 | €8,254,000 |
| €/kWh DC nameplate | €101.5 | €117.5 | €84.8 | €82.5 |
| €/kWh usable @ POI | €106.8 | €123.7 | €89.3 | €86.8 |
Twelve years of operating cost.
Three categories: preventive maintenance, performance guarantee package, warranty extensions Y6-12. Two suppliers price all three. Two defer the back end of the warranty curve to "later in negotiation" — a number that lands somewhere, the question is where.
OPEX 12-yr — full schedule, by supplier
TCO scenario B — CAPEX + warranty extensions
TCO scenario C — Scenario B + performance guarantees
How much energy actually reaches the grid.
Degradation, RTE, and the cumulative GWh delivered over twelve years. SOH curves are reported at 2 c/d, 100% DOD, 25 °C — the only basis on which all four supplied data. Reference lines mark the 80% bankability threshold and the 65% augmentation trigger.
SOH @ 2 c/d, 100% DOD, 25 °C — Y0 to Y15
Round-trip efficiency at POI, Y0
Cumulative MWh delivered, Y0–Y12
What the SOH and RTE gap costs.
A 1 percentage-point shift in RTE or availability moves real money. On a 50 MW / 100 MWh asset running day-ahead arbitrage plus aFRR and mFRR, the four use cases below set the order of magnitude. Capacity market revenue is excluded — Lithuania's mechanism is still in design.
Cumulative lost-revenue exposure relative to A — Y0 to Y12
Where each supplier sits on contractual teeth.
Liability cap, LD framework, governing law, BG transferability. The lines that decide whether the lender accepts the contract or asks for a guarantor.
| Layer | A | B | C | D |
|---|---|---|---|---|
| Capacity LD framework | Built-in F1 formula | Custom mechanism | Custom mechanism | Optional add-on |
| RTE LD | F2 binding | In PG package | Per LTSA | Not offered |
| Availability LD | F3 binding | In PG package | Per LTSA | Optional add-on |
| Liability cap | 100% contract | 30% contract | 100% LTSA / yr | Open |
| APG / PB / WB | EU bank · URDG 758 | EU bank · URDG 758 | CN bank · conditional | Pending |
| Transferable to lender | Yes | Yes | No · CN law | In review |
| Governing law | LT | LT | CN (negotiable) | HK (preferred) |
| Delay LD | 0.05% / d · 10% cap | 0.10% / d · 15% cap | 0.20% / d · 20% cap | Pending |
| Service SLA — emergency | 6 h | 6 h | 8 h | 12 h |
Sign to DAP — what each supplier promises.
Lead time from contract signature to DAP-site delivery. Range across the four: 22 to 30 weeks for the BESS containers. The MV transformer is a separate single-source 14–16 week order — KKME runs it in parallel with the BESS contract, not after, or it sets the critical path.
Risk register at selection.
Severity × likelihood. The four red cells are deal-breakers if not closed before signature; everything else moves into the project risk log and gets managed through commissioning.
From four to one — what each drop costs.
Round 2 close. Three suppliers are eliminated in sequence, each on a single decision axis. The numbers below are the reason each one leaves the table.
Four normalised proposals on the table.
CAPEX spread €8.25M to €11.75M. SOH Y10 spread 68.7% to 75.8%. Liability caps 30% to 100%. Three of the four pass the technical bar; only one passes the lender bar without restructuring.
Supplier B — premium cell does not pay back.
B is the technical leader: 530 Ah cell, +7 pp Y10 SOH, +3 pp RTE. But the CAPEX premium is €1.60M against A on the same scope. Twelve-year revenue advantage is roughly €630k. NPV at 8% discount: B trails A by ~€1.18M.
Supplier C — bank guarantee structure is a hard block.
C is the cheapest viable proposal on CAPEX (€1.67M below A) and competitive on performance. But the proposed APG / PB / WB suite is a Chinese bank, conditional demand, governed by CN law and not transferable to an EU lender. The lender's term sheet requires URDG 758 first-demand from an EU bank. C cannot meet this without a guarantor or restructuring at material cost.
Supplier D — cheapest CAPEX, most expensive twelve years.
D's headline CAPEX is €1.89M below A. But D's per-year operating cost runs roughly €1.05M heavier than A's bundled pack over twelve years, and a binding LD framework costs €920k extra. D's SOH floor is 60% — five points below A's contractual 65%. Once the protections are priced in, A is €400k cheaper on full twelve-year TCO.
Supplier A.
Best balance of cost, contract structure, and lender pack. F1/F2/F3 LDs binding from contract signature, EU bank URDG 758 BG suite, 100% liability cap, Lithuanian governing law, 0.05% delay LD with 10% cap. €106.8/kWh usable at POI on a 12-year horizon.
Four-axis evaluation
Composite score
What goes to Supplier A's negotiation team.
A short, signed-off term sheet that anchors the supply contract redline. KKME drafts it, the developer's law firm reviews, the lender's counsel co-marks the BG and termination lines.
- Scope
- Battery DC containers + 11 × 5 MW EU PCS (procured direct) + MV transformer (LT, separate)
- Capacity
- 50 MW / 100 MWh nameplate, 92 MWh @ POI Y0
- Cycling
- 2 c/d, 100% DOD, 25 °C ambient
- Design life
- 12 years
- Site
- 110 kV POI, 30 kV MV inside fence
- Price
- €10,148,000 DAP, fixed in EUR
- Incoterms
- DAP-site (Lithuania)
- Customs
- 2.7% LT, separately invoiced, buyer scope
- F-gas / EPR
- Itemised; declarations transferred at delivery
- Validity
- 30 calendar days from term sheet signature
- Advance
- 20% on signature, against APG
- B/L
- 30% against bill of lading
- Delivery
- 40% on DAP-site delivery
- PT pass
- 10% on performance test acceptance
- Long-stop
- 120 days from B/L for final tranche
- APG
- 100% of advance, EU bank, URDG 758, transferable to lender
- PB
- 15% of contract, EU bank, URDG 758, until performance test
- WB
- 5% of contract, EU bank, URDG 758, retention through warranty
- Issuer
- Supplier A's EU contracting entity
- Capacity LD
- F1 — linear, €/MWh shortfall against guaranteed Y0/Y5/Y10 SOH
- RTE LD
- F2 — linear, €/pp shortfall annually, capped at 10% contract
- Availability LD
- F3 — linear, €/pp shortfall annually, capped at 10% contract
- Delay LD
- 0.05% / day, 10% contract cap
- Liability cap
- 100% of contract value
- Base
- 5 yr product + performance, bundled in price
- Extension
- Y6-10 priced at ~1.5%/yr of equipment, decision by end Y4
- SOH floor
- 65% binding @ Y10 + augmentation trigger
- SLA
- 6 h emergency, 3 cal d general, 7 BD complex
- Spares
- Strategic kit on site, replenishment SLA defined
- Governing law
- Republic of Lithuania
- Jurisdiction
- Vilnius arbitration, ICC rules, English language
- IP escrow
- BMS firmware + PCS firmware, EU escrow agent
- Force majeure
- Standard EU template, no policy-change carve-out for export tax
- EAR
- Supplier-arranged through DAP, max €10k deductible
- Risk transfer
- At DAP-site delivery (truck floor)
- Title
- At advance payment + APG posting
- Lender step-in
- Direct agreement, supplier to consent
From selection memo to contract.
What happens between this memo and COD. Numbered actions with target weeks from selection.
How KKME runs procurement.
Six stages, end to end. KKME runs each one with the developer — the same person who scopes the brief negotiates the LD framework and is present at FAT.
Translate the developer brief into an RFQ that's actually comparable.
One Incoterms basis. One cycling profile. One scope envelope. Suppliers respond on a single template — KKME's, not theirs.
First-pass comparison and a private gap list per supplier.
Every line item challenged. Every footnote read. Same questions to all, no cross-leakage between suppliers.
Best & final on price, scope, protections, BG.
Competitive pressure on three fronts at once: price, contract, lender pack. Anonymised market signal where it serves the developer.
Decision memo to developer and lender.
One memo, one recommendation, every number traceable to a supplier document. Lender can verify any line without calling the supplier.
Supply contract redline against the selected proposal.
LD framework, BG structure, governing law, termination, IP, insurance. KKME drives the redline alongside the developer's law firm.
FAT, SAT, milestone management through COD.
Factory acceptance, site acceptance, milestone payments, retention release. KKME stays engaged through year-1 performance review.