2. BNEF
UNIVERSITY

3. BNEF UNIVERSITY
JENNY CHASE
Head of Research, Solar
Bloomberg New Energy Finance

4. / / / / / /
PV INDUSTRY: BOOMING IN CRISIS
Falls in price are not purely due to margin compression – they are
also due to gains in efficiency and cost
The entire PV value chain has been remarkably adept at reducing
prices as incentives come down, and installation volumes continue
to grow strongly
We expect installation growth to continue and prices to stabilise in
2013, although consolidation will continue

5. / / / / / /
EBIT MARGINS OF PV MANUFACTURERS, Q4 2012
Source: Bloomberg New Energy Finance
The largest 17 quoted
pureplay PV
manufacturers made a
total net loss of at least
$8.9bn in 2011 and 2012

6. / / / / / /
THE PV MODULE EXPERIENCE CURVE, 1976–2012 ($/W)
Source: Paul Maycock,
Bloomberg New Energy
Finance
0.1
1
10
100
1 10 100 1,000 10,000 100,000 1,000,000
experience curve
1976
2006
2012
1985
2003
2012
experience curve
historic prices (Maycock)
Chinese c-Si module prices (BNEF)
Thin-film experience curve
First Solar thin-film module cost
Cost
per W
(2012$)
Cumulative capacity (MW)

7. / / / / / /
AVERAGE EFFICIENCY OF PV CELLS, 2010-2012 (%)
Source: Bloomberg New
Energy Finance
17.5 17.7 17.2
16.2 16.3 16.1
18.2 18.1 18.2
16.8 16.7 16.8
18.6 18.5 18.6
17.0 17.0 17.0
Mono cell
Average all
mono
China mono International
mono
Average all
multi
China multi International
multi
2010 2011 2012

8. / / / / / /
GERMAN PV COST AND REMUNERATION
0
100
200
300
400
500
600
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Q2
2006
Q1
2007
Q3
2007
Q1
2008
Q3
2008
Q1
2009
Q3
2009
Q1
2010
Q3
2010
Q1
2011
Q3
2011
Q1
2012
Q3
2012
Q1
2013
Capex sub 10kW (EUR/W) Feed-in tariff <10kW (EUR/MWh)
Residential power price (EUR/MWh) Commercial power price(EUR/MWh)
Source: BSW-Solar,
Eurostat, Bloomberg New
Energy Finance
EUR/W EUR/MWh

9. / / / / / /
GERMAN PV COST AND REMUNERATION
Source: BSW-Solar,
Eurostat, Bloomberg New
Energy Finance
EUR/W EUR/MWh
0
100
200
300
400
500
600
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Q2
2006
Q1
2007
Q3
2007
Q1
2008
Q3
2008
Q1
2009
Q3
2009
Q1
2010
Q3
2010
Q1
2011
Q3
2011
Q1
2012
Q3
2012
Q1
2013
Capex sub 10kW (EUR/W) Feed-in tariff <10kW (EUR/MWh)
Residential power price (EUR/MWh) Commercial power price(EUR/MWh)

10. / / / / / /
PV BUILD 2007-2012, CENTRAL FORECAST (MW/YEAR)
Source: Grid operations,
incentive programme
operators, industry
associations, Bloomberg
New Energy Finance
2.8GW
6.6GW 7.7GW
18.2GW
28.7GW 30.6GW
35.7GW
46.6GW
54.5GW
2007 2008 2009 2010 2011 2012 2013 2014 2015
Western Europe Eastern Europe Japan USA
China India Rest of World
Historical Forecast

11. BNEF
UNIVERSITY

12. BNEF UNIVERSITY
JUSTIN WU
Head of Research, Wind
Bloomberg New Energy Finance

13. / / / / / /
THE WIND INDUSTRY IN 2013
Margin
pressure
Manufacturing
overcapacity – 2
times demand
Pricing pressure –
27% drop since
2008
Market uncertainty
– 17% drop in
demand in 2013

14. / / / / / /
TRANSFORMATION OF WIND TURBINE MANUFACTURERS?
Equipment
manufacturer
Energy service
company
GearboxesBlades
Design Siting
O&M
Monitoring
Design
Gearboxes
Blades

15. / / / / / /
TRANSFORMATION OF WIND TURBINE MANUFACTURERS?
Equipment
manufacturer
Energy service
company
MW MWh

16. / / / / / /
TRANSFORMATION OF WIND TURBINE MANUFACTURERS?
Equipment
manufacturer
Energy service
company
Low margins
High competition
Less product
differentiation
One off revenue
Higher margins
More product
differentiation
Longer term
revenue stream

17. / / / / / /
HOW TO BECOME AN ENERGY SERVICES COMPANY?
Product differentiation – turbines designed for specific markets
Increase service revenue – bundle O&M contracts with turbines
sales
Flexible manufacturing – quality instead of quantity

18. / / / / / /
TURBINE PRODUCT STRATEGY
Target
specific
markets
Low wind speeds
High altitude
Extreme environments
Offshore wind
Diversify
tech &
component
risk
Lower costs
& improve
output
Drive train configuration
Generators
Power converters
Hub heights
Rotor diameter
Improved operations

19. / / / / / /
PRICING BY TURBINE TYPE, 2008-13 (EUR M/MW)
1.10 1.10
1.21 1.20
1.06
1.02
0.98
0.94
0.90
0.85 0.82 0.82
0.99 0.99 1.02
0.99
H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2
2008 2009 2010 2011 2012 2013
WTPI Old models New models
16%
average
price gap

20. / / / / / /
O&M AND TURBINE SALES ANNUAL REVENUE POTENTIAL
2008-15E (EUR BN)
3.4 3.8 4.0 4.3 4.8 5.4 6.2 7.0
18.7
28.5
26.4
29.2
30.3
25.1
29.8 29.2
2008 2009 2010 2011 2012 2013 2014 2015
O&M Turbine sales
24%
17%
O&M will be
¼ of turbine
sales
revenue by
2015

21. / / / / / /
FLEXIBLE MANUFACTURING
Cut costs Expand into
new markets
Reduce
presence in
heavily
oversupplied
markets
Meet local
needs in new
markets
(servicing,
local content
requirement)

22. / / / / / /
THE WIND INDUSTRY’S NEW ROI
Resilience: ability to survive pricing pressure and overcapacity in
supply chain by rethinking business model
Optionality: selling more than one product, selling an energy
service
Intelligence: specific products targeted to specific customers in
specific markets

24. BNEF UNIVERSITY
MARK TAYLOR
Head of Research, Geothermal & CCS
Bloomberg New Energy Finance

25. BNEF
UNIVERSITY

26. / / / / / /
ONLINE GEOTHERMAL POWER ASSETS
Just 11.4GW online
globally
196GW estimated
potential

27. / / / / / /
ESTIMATED GEOTHERMAL RESOURCE POTENTIAL (MW)
113GW (est.) in 39
developing countries
Seen as economic
development tool

28. / / / / / /
ANNOUNCED GEOTHERMAL PROJECTS
10.3GW (224 projects)
stuck in pre-drilling

29. / / / / / /
PROJECTS STUCK BECAUSE OF DRILLING RISK
Sticking point
$m
Source: Bloomberg New Energy Finance

30. / / / / / /
A GLOBAL EXPLORATION DRILLING FUND
LOANS
COMMERCIAL
BANK
LOANS
LOANS
DEVELOPMENT
FINANCE ORG
GEOTHERMAL EXPLORATION
DRILLING FUND
PORTFOLIO

31. / / / / / /
PROJECT SUCCESS PROBABILITY
DRILLING SUCCESS FACTORS FUND COSTS ($M)
44%
73%
62%
55%
75%
69%
0.34%
11% 13%
27%
30%
18%
100-
150C
150-
190C
190-
230C
230-
300C
300C+ Steam
field
Field success rate Field prevalence
1%
5%
34%
60%
549
Set-up Admin Debt service Write-offs Total costs
Source: Bloomberg New Energy Finance, Rinova International, IFC

32. / / / / / /
INTEREST RATES CHARGED TO SUCCESSFUL PROJECTS
SENSITIVITY TO DRILLING SUCCESS SENSITIVITY TO COST OF CAPITAL
Historical
weighted
average
success
0%
10%
20%
30%
40%
50%
60%
70%
40% 50% 60% 70% 80% 90%
Drilling success rate
Multilateral
3.5%
Private
7%
0%
10%
20%
30%
40%
50%
60%
70%
0% 5% 10% 15%
WACC
Source: Bloomberg New Energy Finance, Rinova International

33. / / / / / /
KEY TAKEAWAYS
Fund is feasible – provide access to capital
Leverage investment 1:18
Catalyse capacity expansion

35. BNEF UNIVERSITY
ALBERT CHEUNG
Head of Research, Energy Smart Technologies
Bloomberg New Energy Finance

36. BNEF
UNIVERSITY

37. / / / / / /
RESILIENCE: IMPACT OF SANDY ON THE POWER GRID
806
630
450
300
156 14
LIPA JCP&L ConEd PSE&G CL&P Pepco
Total customers that
lost power: 8.6m
SANDY STORM DAMAGE ESTIMATES
OF SELECTED UTILITIES ($M)

38. / / / / / /
RESILIENCE: CAN SMART TECHNOLOGY HELP?
PEPCO (DC) – SANDY 2012
• 425,000 smart meters installed and
activated at time of storm
• ‘Last-gasp’ functionality for outages
• Meters ‘pinged’ to locate faults
• Power restored to 130,000 homes
in two days
VERMONT ELECTRIC COOP:
OUTAGE FREQUENCY, 2005-2010
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
Jan-05
Jun-05
Nov-05
Apr-06
Sep-06
Feb-07
Jul-07
Dec-07
May-08
Oct-08
Mar-09
Aug-09
Jan-10
Jun-10
System average interruption frequency index (SAIFI)

39. / / / / / /
RESILIENCE: UTILITY RECONSTRUCTION PLANS ($M)
PUBLIC SERVICE ELECTRIC & GAS (NJ)CONSOLIDATED EDISON (NY)
240
200
165
106
105
100
60Upgrading selected ovehead lines
Network reconfiguration
Floodproof 460/208/120 volt equip
Gas system flood protection
Electric/steam flood barriers
Moving selected line underground
Substation flood barriers
976
1,700
1,040
454
215
200
140
60
Move 20 miles of lines undground
Protection of gas metering stations
Improve redundancies
Improve distribution lines
Smart grid deployment
Modernize gas mains
Upgrade switching/substations
3,809
Network reconfiguration
Smart grid deployment

40. / / / / / /
OPTIONALITY: MICROGRIDS
15
9
9
4.8
2.41
1
0.5
Princeton distributed
energy resources (MW)
Back pressure steam turbine
Demand response
Diesel generation
CHP
PV
Chilled water storage
Steam-driven cooling
Gas turbine / HRSG
Total: 43MW
PRINCETON UNIVERSITY MICROGRID CASE STUDY
• Resilience:
• Can provide power, cooling and heat to entire
campus in island mode, when utility is down
• Optionality:
• Can use DERs to participate in wholesale and
ancillary service markets
• Can purchase power in wholesale markets –
arbitrage and hedging
• ‘Safe haven in the storm’ during Sandy
• Key enablers:
• Smart microgrid technology
• Renewable energy policy
• Restructured market

41. / / / / / /
INTELLIGENCE: SMART ENERGY DATA APPLICATIONS
Geospatial visualisation tools for situational intelligence
Space-Time
Insight
BuildingIQ
DataRaker/Oracle
Using near real-
time data feeds to:
• Predict
renewable
generation
• Track outages
• Monitor asset
health
• Coordinate
emergency
response

42. / / / / / /
INTELLIGENCE: SMART ENERGY DATA APPLICATIONS
Predictive optimisation of building energy use using building data,
weather forecasts and demand response programme information
Utility DR
programs,
pricing data
BMS system
-HVAC
-Lighting
-Occupancy
Weather
data
Building
optimisation
engine
Improved DR
capacity and
overall building
efficiency
Space-Time
Insight
BuildingIQ
DataRaker/Oracle

43. / / / / / /
INTELLIGENCE: SMART ENERGY DATA APPLICATIONS
Cloud-based, big data tools to mine smart meter data
Using smart meter
data analytics to:
• Pinpoint energy
theft
• Identify faulty
metering
conditions
• Build asset
utilisation
profiles
Space-Time
Insight
BuildingIQ
DataRaker/Oracle

45. / / / / / /
BNEF UNIVERSITY
HARRY BOYLE
Head of Research, Bioenergy
Bloomberg New Energy Finance

46. / / / / / /
BNEF
UNIVERSITY

47. / / / / / /
BIOENERGY MARKET SIZES, 2013 AND 2020
2013:
$125bn
111
26
4
23
56
First-gen biofuels
Biomass-to-power
Waste-to-energy
Biochems
Next-gen
biofuels
62
0.0011
20
41
First-gen biofuels
Biomass-to-power
Waste-to-
energy
Biochems Next-gen
biofuels
2020:
$220bn

48. / / / / / /
FIRST-GENERATION BIOFUELS CAPACITY, 2004 – 2013 (M GALLONS)
Source: Bloomberg New Energy Finance
10 12
15
22
31
35
39
41 42 42
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Hydrotreatment Transesterification 1-Gen fermentation

49. / / / / / /
OLD SCHOOL VERSUS NEW SCHOOL BIO-INNOVATION
SURPLUS BIOMASS INCINERATION POWER
SOFT COMMODITIES
FERMENTATIO
N
ESTERIFICATI
ON
ETHANOL
BIODIESEL
Limited innovation; uses well known processes
UPSTREAM MIDSTREAM DOWNSTREAM
40 FEEDSTOCKS x 50 TECHNOLOGIES x 20 PRODUCTS
= 40,000 THEORETICAL PATHWAYS
ALL BIOMASS
MULTIPLE
PATHWAYS
TAILORED
PRODUCTS

50. / / / / / /
SELECTED BIOENERGY PATHWAYS
GRAINS;
SUGARCANE
AGRICULTURAL RESIDUES;
WASTE; WOOD; ENERGY
CROPS
OILS, FATS, WASTE HYDROTREATMENT
GASIFICATION
TRANSESTERFICATION
FERMENTATION
ENZYMATIC / ACID
HYDROLYSIS & FERMENT.
INCINERATION;
GASIFICATION; CO-FIRING
ANAEROBIC DIGESTION
BIODIESEL,
RENEWABLE DIESEL
ETHANOL, BUTANOL
ELECTRICITY,
BIOMETHANE
SOLVENTS, PAINTS,
LUBRICANTS,
COSMETICS,
PLASTICS, RUBBERS
DIESELGAS.POWERCHEMICALS
FEEDSTOCKS TECHNOLOGIES PRODUCTS

51. / / / / / /
TECHNOLOGY GLOBAL SHAKE OUT
ENERGY CROPS
D1 OILS, MENDEL
CORN / WHEAT
MUNICIPAL WASTE
FULCRUM, ENERKEM
JATROPHA
AG. RESIDUES
POET, DUPONT
SUGARCANE
WASTE GASES
LANZATECH, JOULE
GASIFICATION
RENTECH, CHOREN, CHEMREC
PYROLYSIS
DYNAMOTIVE
TRANSESTERIFICATION
TORREFACTION
ENZYMATIC HYDROLYSIS
DSM, M&G, NOVOZYMES, RAIZEN
ADVANCED
FERMENTATION
MYRIANT, COBALT, AMYRIS
HYDROTREATMENT
NESTE OIL, DIAMOND GREEN
ISOBUTANOL BUTAMAX, GEVO
N-BUTANOL GREEN BIOLOGICS
FARNESENE AMYRIS
HVO NESTE OIL, DYNAMIC
BIOCHEMICALS
SOLAZYME, GENOMATICA
BIODIESEL
TORREFIED PELLETS
ALGAL BIOFUELS
SYNTHETIC GENOMICS
BIOGASOLINE
LS9, PRIMUS GREEN ENERGY
FEEDSTOCKS TECHNOLOGIES PRODUCTS
STRUGGLINGSTILLGOING

52. / / / / / /
CELLULOSIC ETHANOL COSTS ($ PER GALLON)
2012 2016
3.56
0.95
1.46
0.19
0.56
0.22
0.15 0.18 -0.17
Feedstock
Capex
Pretreatment
Enzymatichydrolysis
Fermentation
Labour
Utilities
By-products
Total
2.55
0.85
1.14
0.10 0.29
0.09 0.09
0.18 -0.19
Feedstock
Capex
Pretreatment
Enzymatichydrolysis
Fermentation
Labour
Utilities
By-products
Total

53. / / / / / /
NEW TECHNOLOGY GLOBAL LANDSCAPE
SUGARCANE AG. RESIDUES
“SIMPLE” “MORE COMPLEX”
SUGARS
TAILORED FATS / OILS
FARNESENE
LAURIC ACID
OLEIC ACID
BIODIESEL
FUELS
ETHANOL
BUTANOL
RENEWABLE DIESEL
BIOGASOLINE
CHEMICALS
C2: ETHYLENE, MEG, PET
C3: PROPYLENE, ACRYLIC ACID
C4: BUTADIENE, BUTENE, BUTANOL
PRODUCTMARKETFEEDSTOCK
PHARMACEUTICALS,
TRANSPORT, FOOD,
PLASTICS
ROAD, AVIATION & MARINE
PLASTICS, PAINTS, SOLVENTS,
LUBRICANTS, RUBBER, PLASTICS

54. / / / / / /
CONCLUSIONS
Do investors understand the dynamics of niche and bulk
agricultural commodity markets well enough? Fingers burnt during
1-gen roll out
Bioenergy industry already shown its ability to innovate: now going
through a natural shake-out stage, where some technologies pass
and some fail
Steel going in ground for a dozen semi-commercial scale cellulosic
ethanol plants, with well-capitalised players heavily involved:
industry inflection point almost there