ZERO CAPEX SCHEME

 Hydro Lestari offers two distinct Zero CAPEX partnership models, designed to meet different customer, regulatory, and financing requirements:

1. Build–Finance–Operate–Transfer (BFOT) Model
2. Tariff-Based Build–Finance–Operate (BFO) Model
    

Each model allows customers to develop critical water and environmental infrastructure without upfront capital investment, while ensuring long-term performance and compliance.

Under the BFOT model, Hydro Lestari develops and operates the facility as a long-term infrastructure asset, which is transferred to the customer at the end of the contract term.

Hydro Lestari:

• Establishes a Special Purpose Vehicle (SPV) dedicated to the project
• Takes full responsibility for:
  • Engineering and detailed design
  • Construction and commissioning
  • Project financing and capital investment
  • Asset ownership during the contract period
  • Operation, maintenance, and performance management
     

The customer:

• Enters into a long-term agreement, typically 10–30 years
• Pays an agreed service-based charge or capacity-based fee, covering:
  • Operating and maintenance costs
  • Capital investment amortisation
• Receives full ownership of the asset at contract completion, in good operating condition

• Municipal infrastructure projects
• Industrial facilities requiring asset ownership in the long term 
• Projects with fixed demand and long operational horizons

Under the Tariff-Based BFO model, Hydro Lestari builds, finances, and operates the treatment facility and recovers its investment through a unit-based tariff, typically charged per cubic metre (m³) of water or wastewater treated.

Hydro Lestari:

• Designs, builds, and finances the treatment facility
• Owns and operates the plant throughout the contract term
• Ensures compliance, performance, and operational efficiency
   

The customer:

• Pays a treatment tariff, calculated on:
  • Cost per m³ of treated water or wastewater
  • Minimum guaranteed volume and contract term
• Commits to a minimum contract duration, sufficient to allow full recovery of capital and operating costs
• Does not take ownership of the asset at the end of the contract (unless separately agreed)
   

• Tariff-based payment structure
• Volume-linked cost (pay for actual usage)
• Predictable operational expenses
• No capital expenditure or asset ownership responsibility
   

• Industrial users with variable water demand
• Projects where asset ownership transfer is not required
   
• Fast deployment or temporary / expandable facilities

 Both the BFOT and Tariff-Based BFO models can be applied to:

• Potable water treatment plants
• Industrial water treatment systems
• Containerised and modular RO plants
• Ultra-pure water systems
   

• Industrial wastewater treatment plants
• Leachate treatment facilities
• Wastewater recycling and reuse systems
   

• POME bio-solids recovery
• Resource valorisation into organic fertilizer feedstock
• Revenue-sharing arrangements where applicable

• Zero upfront CAPEX
• Flexible commercial models to suit different needs
• Long-term risk-sharing partnerships
• Fully integrated technical and financial responsibility
• Performance-driven operations
• Strong focus on sustainability and regulatory compliance