FOR SIXTY YEARS WEHAVE BEEN TAKING THEPOWER FROM WATER ANDHANDING IT OVER TONATIONS

LINKING THE DOTSBucharest,

February 20, 2014

ISPH PROJECT DEVELOPMENTA GREAT COMPANY IS

EXACTLY THE SUM OF ALL ITS SERVICES

HYDROPOWER WATER INFRASTRUCTURE

ENVIRONMENT CONSULTANCY

ISPH PROJECT DEVELOPMENTOVER 60 YEARS OF HYDROPOWER DESIGN

1949 1963 1996 2013

1st Hydro Engineering Department

Institute of Hydroelectric Studies and Design

Private ownership ISPH Project Development

900KM OF TUNNELS

AND GALLERIES

150LARGE DAMS

180HYDROPOWER

PLANTS

6000MW INSTALLED CAPACITY

60YEARS

OF ENGINEERING

WHY HYDROPOWER?

Hydropower is Romania’s most available, reliable, affordable and sustainable energy source

Requiring only the power of moving water – rivers and streams – hydropower is also domestic and sustainable

Hydropower is free from a dependence on volatile fuel prices

HYDROPOWER IS AVAILABLE

Hydro is Romania’s largest source of clean electricity, accounting for over 90 percent of all renewable energy generation in Romania and a third of total electricity generation

Hydropower has generated clean, affordable electricity for more than 100 years, but it has yet to realize its full potential

HYDROPOWER IS AVAILABLE

Much of hydropower’s future growth can be focused on facilities and infrastructure already built

Modernization projects upgrade turbines and other equipment, expanding the capacity and lifespan of existing hydropower facilities

The process of upgrading Romania’s hydropower facilities has already begun, with great success

HYDROPOWER IS RELIABLE

Hydropower has been a reliable source of power in Romania for over a century

Based on a constant source of energy hydropower can support other renewable energy sources as they are brought onto the grid

Pumped storage can help store the electricity generated by other power sources for later use

HYDROPOWER IS AFFORDABLE

Hydropower is among the most cost effective energy sources across the board

Hydropower offers the lowest levelized cost of electricity across all major fossil fuel and renewable energy sources

Hydropower generating equipment can often operate for long periods of time without needing major replacements or repairs

HYDROPOWER IS SUSTAINABLE

Using hydropower avoids more than 10 million tons of carbon pollution in Romania each year

Energy and water for sustainable development depend not only on supply choices, but also on how these choices are implemented

HYDROPOWER PROJECTS DEVELOPMENTOVERVIEW

Private involvement in the energy sector is becoming increasingly important as public funding diminishes

Hydropower projects will have to compete for financing on the same terms as other projects, both in public budgets and in the private market

Hydropower projects involve large up front investment, and are often regarded as high risk compared to other type of power projects

HYDROPOWER PROJECTS DEVELOPMENTSMALL HYDROPOWER PROJECTS – PARTICULAR ISSUES

Small hydropower projects, i.e. those with a maximum output of less than 10 MW, often have additional features that make them less profitable and thus more difficult to finance than larger projects.

Several of the cost components involved in developing hydropower do not change proportionally with project size.

HYDROPOWER PROJECTS DEVELOPMENTSMALL HYDROPOWER PROJECTS – PARTICULAR ISSUES

As the expected revenue of the project is small, there is little capacity to absorb unforeseen expenses

Consequently the economic feasibility of a small project is very cost-sensitive and the risk is higher than for larger projects

Tight cost control is necessary to succeed

HYDROPOWER CONSULTANCYTHE KEY ROLE OF HIGH QUALITY ENGINEERING SERVICES

High quality engineering services has an important role in:

- reducing the cost of development and financing to make the project more profitable

- reducing the risks involved in small hydropower development and operation to make projects more attractive to developers and financiers

HYDROPOWER CONSULTANCYTHE KEY ROLE OF HIGH QUALITY ENGINEERING SERVICES

Cost reduction strategies

Area development package. The joint development of a number of small hydro projects in an area has multiple cost-saving effects.

Multi-disciplinary development groups. Supported by an experienced consultant, the development group will develop experience in all fields, enabling them to quickly evaluate the feasibility of proposed projects

HYDROPOWER CONSULTANCYTHE KEY ROLE OF HIGH QUALITY ENGINEERING SERVICES

Risk reduction strategies

Accurate data assumption. Hydropower developers rely on measurement of stream flow and rainfall to estimate power production and floods

Stepwise development. Stepwise increase in the production capacity reduces the up front investment, and the debt obligations can more easily be adjusted to the economic strength of the project

LINKING THE DOTSWHERE DO YOU NEED ISPH?

Regulatory requirements, planning and permitting

Environmental solutions

Preliminary and detailed hydropower design

Construction management

Start-up and commissioning

Power delivery

ISPH PROJECT DEVELOPMENTBY ENGAGING US, YOU GET ACCESS TO

Our multi-disciplinary design team who mixes expertise and proven reputation for quality design hydropower projects

Comprehensive services and expertise in regulatory requirements, planning and permitting to ensure hydropower project success

The expertise of our valued associates and advisors, well known names in their respective fields

THANK YOU!

HYDROPOWER WATER INFRASTRUCTUREENVIRONMENT CONSULTANCY

293 Calea Vitan, 031295 Bucharest RomaniaT +40 (0) 21 314 72 70, F +40 (0) 21 312 09 25, E info@isph.ro, W www.isph.ro