Renewable Energy Generation Ltd

1
RenewableEnergyGeneration Ltd

• Overview

Developing the Worlds Renewables
2
Introduction to REG

• Renewable Energy Generation is the largest
  publicly quoted renewable energy company in the
  UK dedicated to investing in operating plant
• Market capitalisation of 100m
• Listed on the London Stock Exchanges AIM market
  with the symbol RWE
• REGs mission is to build the value of its
  shareholder equity by owning and operating
  renewable energy projects thereby contributing to
  national sustainable energy targets
• REG has a vastly experienced development and
  operational team and already owns
• The Cornwall Light Power Company Ltd and
  through it
• The Goonhilly Downs wind farm in Cornwall
• CLP Wind Projects 24 UK wind projects, 5
  consented
• In addition REG is the main equity investor in
  Polands largest wind farm at Tymien 50MW
• REG has no debt and 55m of cash in hand

Goonhilly Downs
3
REG shareholders

• REGs shareholders include some of the largest
  financial institutions in Europe
• Legal and General
• Invesco Perpetual
• Fidelity
• New Star
• Foreign and Colonial
• Hendersons
• Credit Suisse
• UBS
• REG has recourse to its shareholders if further
  capital required
• But we must now build out what we have acquired

Goonhilly Downs
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REGs current investments

• CLP Wind Projects UK
• 75MW when developed
• 24 sites across UK, 5 consented
• Developed by National Wind Power RWE
• Good wind regimes cost competitive
• 4m

• Tymien 1 Poland
• 50MW Fully Operational in Q1 2006
• Near Baltic Coast
• 15 year PPA, partnered with EEZ and Invenergy,
  IRR above REG portfolio average
• Stable, attractive renewable energy incentive
  scheme provided by accession to EU
• 7.9m

• Goonhilly Downs Cornwall, UK
• 5.6MW
• Excellent 12 yr production record
• 2.5 yr PPA signed at very high prices
• Freedom to explore repowering potential
• Freedom to play the green power market
• 4.5m

Goonhilly Downs
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Tymien, Poland

• Polands largest wind farm 50MW
• Uses 25 Vestas V90 machines
• REG is main equity investor in project
• Working with Invenergy of the US and EEZ of
  Poland
• EU backed project
• 15 year PPA with 2 state owned distribution
  companies
• Two follow on stages taking total capacity to
  150MW
• An excellent first project in Eastern Europe for
  REG

Tymien
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REGs future plans

• Tymien 2 3, Cisowo Poland
• 118MW
• First right as principal investor in Tymien 1
• IRR similar to Tymien 1
• Tymien 1, 2 3 will total 150MW
• Cisowo will total 18MW
• Scheduled for 2006 and 2007

• WindWorks UK
• 75MW
• High Sharpley, High Pow, Braich Ddu close to
  construction
• Pipeline of projects

• Goonhilly Downs Cornwall, UK
• Repowering Programme 15MW
• The wind turbines currently in use are 0.4MW
  each, modern turbines are typically gt1MW

• Other CEE Region
• Greece has existing projects and infrastructure
• Romania anticipates EU entry
• Bulgaria has excellent resources

• Latin America
• Brazil has strong renewables program
• Mexico stalled on regulatory issues
• Chile developed country infrastructure

Goonhilly Downs
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Carbon Sales

• Carbon Sales important to emerging market
  projects
• Value in range of 20 per tonne (long-term
  contracts are lower)
• Depending on carbon intensity, can mean 15 per
  MWH
• CDM is virtually useless in providing project
  support
• Process highly uncertain additionality makes
  outcomes highly uncertain
• Mechanism is amateur CDM Executive Board is
  part-time and underfunded
• RESULT Few trades and little interest
• JI offers better prospects
• National basis
• Not well understood in prospective markets
• Need for support by EU

8
Institutional Barriers

• LDCs often present substantial barriers to
  renewable energy development
• Transparency a concern local utilities may have
  entrenched interests opposed to new equipment
  suppliers
• Land registration and title massively important
  to renewables particularly wind
• Deregulation is not on national agendas
  traditional western country PPA structure may not
  be viable

9
Conclusion

• Increasing interest in private sector equity
  investment in renewables in emerging markets
• Need action to deal with barriers
• Reform of Carbon Trading
• Begun at Montreal Conference, but needs momentum
• Deal with institutional barriers
• Need to build on work of IFC/World Bank in
  electricity reform
• Renewables are economic, especially in high cost
  LDC power markets
• Renewed efforts needed to spearhead change