REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 1 / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / / /

BUSINESS CASE FOR GREEN POWER, AND: GLOBAL CORPORATE RENEWABLE ENERGY INDEX (CREX)

16 NOVEMBER 2011

SAN FRANCISCO, RENEWABLE ENERGY MARKETS CONFERENCE

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 2 / / / /

6.24.9 5.1

6.6 7.5

10.89.3

11.513.012.9

16.8

23.9

17.819.9

25.2

28.4

23.5

31.430.0

31.1

19.7

31.428.6

27.9 27.626.3

33.0

41.6

30.6

35.0

41.8

Q1 04

Q2 04

Q3 04

Q4 04

Q1 05

Q2 05

Q3 05

Q4 05

Q1 06

Q2 06

Q3 06

Q4 06

Q1 07

Q2 07

Q3 07

Q4 07

Q1 08

Q2 08

Q3 08

Q4 08

Q1 09

Q2 09

Q3 09

Q4 09

Q1 10

Q2 10

Q3 10

Q4 10

Q1 11

Q2 11

Q3 11

Four quarter running average

GLOBAL ASSET FINANCING FOR NEW BUILD CLEAN ENERGY ASSETS, Q1 2004–Q3 2011 ($BN)

Source: Bloomberg New Energy Finance Note: Total values include estimates for undisclosed deals

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 3 / / / /

DESCRIPTION MODEL EXAMPLE

REC procure

ment

Green power

procurement

Siting Financing Power offtake

REC offtake

Utility service Siting Financing

Power offtake

REC offtake

Cor

pora

te s

usta

inab

ility

• Company purchases RECs

• Company partakes in utility’s green power offer

Inte-grated

• Company provides siting, financing, buys power, retires RECs

Siting Financing

Power offtake

REC offtake

Asset finance

• Company finances project (eg, debt, equity, tax equity)

On-site PPA

• Company provides siting (eg, rooftop) and consumes power

Siting Financing Power offtake

REC offtake

Siting Financing

Power offtake

REC offtake

Inve

stm

ents

CORPORATE PARTICIPATION IN RENEWABLE ENERGY: BUSINESS MODEL OPTIONS

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 4 / / / /

TOP COMPANIES FOR RENEWABLE ENERGY PROCUREMENT (RANKED BY % RENEWABLE IN 2010)

Basic materials

Comm-unications

•Plum Creek Timber •Newmont Mining (*) •Praxair(*)

•News Corp •Koninklijke KPN NV •Nokia

Consumer goods

•Kohl’s •Whole Foods Market •Starbucks

Energy and

utilities

•CLP Holdings •Origin Energy •AGL Energy

Financial services

Industrial

•Toronto Dominion •Swiss Reinsurance •Nordea Bank

•Vestas Wind Systems •Koninklijke Philips •Deutsche Post

Tech-nology

•Adobe Systems • Intel •Dell

Source: Bloomberg New Energy Finance, EPA, CDP

(*) Based on 2009 results. For 2010, only one company in this sector (Plum Creek) submitted data.

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 5 / / / /

RENEWABLE ENERGY PROCUREMENT BY SECTOR (AVERAGE %)

Source: Bloomberg New Energy Finance, EPA, CDP Note: Analysis only reflects results from companies who responded to both the 2009 and the 2010 iterations of the survey, to enable proper comparison across years.

0%

5%

10%

15%

20%

25%

30%

Com

mun

icat

ions

Con

sum

er

Fina

ncia

l

Indu

stria

l

Tech

nolo

gy

RE / total electricity (%) in 2009 RE / total electricity (%) in 2010

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 6 / / / /

RENEWABLE ENERGY PROCUREMENT BY REGION

Source: Bloomberg New Energy Finance, EPA, CDP Note: Analysis only reflects results from companies who responded to both the 2009 and the 2010 iterations of the survey, to enable proper comparison across years.

0

10

20

30

40

50

60

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

North America Europe Asia & Oceania

RE / electricity consumption (%) in 2009

RE / electricity consumption (%) in 2010

# of companies in 2009 & 2010

Weighted average renewable energy % Number of companies

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 7 / / / /

RENEWABLE ENERGY PROCUREMENT BY SECTOR AND TECHNOLOGY TYPE (VOLUME WEIGHTED %), 2010

Source: Bloomberg New Energy Finance, EPA, CDP Note: Volume weighted by GWh of renewable energy procurement

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Com

mun

icat

ions

Con

sum

er

Fina

ncia

l

Indu

stria

l

Tech

nolo

gy

Other/UnknownNational blendWaste energyHydroWindSolarGeo-thermalBiomass/ biofuel

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 8 / / / /

COMPARISON OF PROCUREMENT PREFERENCES, 2009-10 (% OF TOTAL PROCUREMENT)

Source: Bloomberg New Energy Finance, EPA

0%10%20%30%40%50%60%70%80%90%

Carbon Offsets Direct Investment

Green Pricing RECs

2009

2010

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 9 / / / /

TRACKING THE INDEX ON BLOOMBERG: CREX<GO>

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 10 / / / /

PERFORMANCE OF CREX AGAINST BENCHMARK INDEX (CUMULATIVE % RETURN ON PORTFOLIO)

Source: Bloomberg New Energy Finance, MSCI Inc

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Jun 08 Dec 08 Jun 09 Dec 09 Jun 10 Dec 10

CREX

MSCI World Index

Note: MSCI World Index is commonly used benchmark for global stock funds, comprised of more than 1,600 companies in 24 developed markets. CREX is comprised of 102 companies who provided survey responses with 2010 data. Note that while this survey has treated Motorola as one entity (to enable comparison between 2009 and 2010), the index separates Motorola into its two publicly traded entities: Motorola Mobility and Motorola Solutions. CREX assigns equal weighting to each company. Performance is for total returns.

REM CONFERENCE: CORPORATE RENEWABLE ENERGY INDEX (CREX) – NOV 2011 11 / / / /

TAX EQUITY STRUCTURES: PARTNERSHIP FLIP MODEL (10-YEAR FLIP – YIELD CONTINGENT)

Source: Bloomberg New Energy Finance

Pre-flip Post-flip

Tax equity investor

Project company (100% equity)

ITC/PTC Power and REC sales

100% cash flows

MACRS

99% of tax credits; 35.75% of cash flows in yrs 1-5; 60% of cash flows in yrs 6-10

sources of tax credits sources of revenue

sources of funding

100% tax credits

Developer

1% of tax credits;

64.25% of cash flows in yrs 1-5; 40% of cash flows

in yrs 6-10

Tax equity investor

Project company (100% equity)

ITC/PTC Power and REC sales

100% cash flows

MACRS

5% cash flows; 99% of tax credits

sources of tax credits sources of revenue

sources of funding

100% tax credits

Developer

95% cash flows; 1%

of tax credits

Lender

Interest payments

Loan

Lender

Interest payments

/ / / / / / / / / / / / / / / / / / / / / / / / / / / /

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