Price Risk in CDM projects How EnBW can help Project Owners in the Mitigation of Price Risks www.enbw.com

The Power Pioneers EnBW Energie Baden-Württemberg – Facts and Figures

EnBW AG is the third largest German Utility › External revenue: m € 16,305 (2008) › EBIT: m € 1,468 (2008) › Employees: 20,357 (2008) › Total capacity: MW 15,000 (2008) › Sales: ›Electricity: bill. kWh 140 (2007) ›Gas: bill. kWh 75 (2007)

EnBW AG

2 2 EnBW’s Generation Capacity

Hesse Lippendor f Generation: (Saxony) › 2 nuclear power plants Cattenom (F) Mannheim Nuclear power plant Capacity: 4,846 MW (2008) Bexbach › Obrigheim1 (Saar land) Conventional power station Philippsburg Neckar Heilbr onn › 10 thermal power stations: Hydr o- station power stations Capacity: 6,585 MW (2008) › Wal heim 1 operations ceased on Karlsruhe May 11, 2005 as a r esult of › 11 hydro-electric power stations - Marbach Rhine power Münster the nuclear energy consensus stations Gai sbur g (CERGA/RKI) St ut t gar t › Capacity: 3,472 MW (2008) -Deizisau Forbach › Other Renewable energies Gl em s

Ulm Upper Danube power stations › Capacity: 100 MW (2008) F Rhine-Main-Danube-power stations

TOTAL installed capacity : 15,000 Schluchsee- Bavaria power stations Biberach Iller power stations MW Freiburg Fessenheim (F)

Variospower stations on the Upper Rhine Sel l r ain- Sil z (/) EnAl pin AG Vorarlberger Illwerke CH A

3 3 Volatility of the secondary CER Price

Price of the CER 2009

22 21,85 21 20 19 18 17 16 15 14 13 12

EURO/ tCO2 EURO/ 11 10 9 8 7 7,60 6 5 11.08.2008 25.08.2008 08.09.2008 22.09.2008 06.10.2008 20.10.2008 03.11.2008 17.11.2008 01.12.2008 15.12.2008 29.12.2008 12.01.2009 26.01.2009 09.02.2009 23.02.2009 09.03.2009 23.03.2009 06.04.2009 20.04.2009 04.05.2009 18.05.2009 01.06.2009 15.06.2009 29.08.2008 12.02.2009 › A price decrease of more than 60% in not even 6 months shows the high volatility in the secondary market › This volatility results in fundamental market risks and might substantially harm the profit of CDM project owners › Within a cooperation project owners might use the competence in risk management of EnBW in order to mitigate price risks 4 Cooperation Opportunities between Project Owners and EnBW

Price risk of CDM project owner

ERPA with fixed price structures

ERPA with ERPA with mixed indexed price structures indexed and fixed price structures

Equity investment in the CDM project

Expected revenue of CDM project owner

› Depending on the cooperation the price risks of CERs will be divided differently between the project owner and EnBW › With our flexible approach we cover the whole value chain of CDM and hence we can meet the individual risk preference of each project owner

5 Project Owner’s additional Benefits of a Cooperation with EnBW

What we can provide generally: › Coordination of the CDM developing process › Participation in our technological expertise › Facilitation of financing What we provide in general in an ERPA: › With flexible up-front payments we contribute to the financing of your project › We pay for the Validation and Registration of your Project as well as for the Verification and Certification of the Kyoto Credits

6 EnBW‘s country focus is on CDM projects in South America and Africa

Planned Investment Portfolio: › Latin-America: 300 Million USD › Africa: 300 Million USD Requirement: › Reliable project partner in host country

Pana ma Kenya Uganda Peru Zambia Brazil Chile South Africa

7 Please contact us for further information

Contact: Dr. Markus Schaller ++49 160 5870 008 [email protected]

The Power Pioneers Back-Up

The Power Pioneers EnBW’s Experience in

Hydro Power: traditionally most important, some retrofitting 100MW 63 running river, 12 pump storage, 3,472 MW

Wind: On-shore 80 MW (end 2009) Off-shore planned for 2010 to 2014: 1.200 MW in Baltic/

Biomass: concentration on regionally applications 45 MW el, 120 MW heat, approx. 350,000 t wood/a

10 EnBW Wind Power Activities Summary

Onshore Capacity: 80 MW in Germany On-Onshore and Offshore Portfolio: WindTurkey farm projects (approx. 340 MW until 2020) and Poland › ProjectOffshore development Portfolio: Capacityand funding to be installed: 1.188 MW › Construction› 2 projects and commissioning in German : „Baltic 1“ and „Kriegers Flak“ › Operation› Planned for 2010 and 2011 › National› 2and projects international in the German cooperations North Sea: „He Dreiht“ and „Hochseewindpark Nordsee“ › Participation› Planned and acquisition for 2013 andof wind 2014 farms and portfolios

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