Invenergy The Power of Innovation Discussion Outline

Invenergy The Power of Innovation

Discussion Outline p Introduction to Invenergy p Wind generation development 101 p The impact of HB 1871 – The Illinois state RPS Invenergy

Invenergy Wind Overview Operational Projects Contracted Projects Invenergy Offices Invenergy

Invenergy Midwest Portfolio Grand Ridge Location: IL Size: 350 MW COD: Mid 2008 Interconnection: PJM Bishop Hill Locations: IL Size: 400 MW COD: Late 2008 Interconnection: PJM/MISO Wind Project Victory Location: IA Size: 99 MW COD: December 2006 Interconnection: Mid. Am Forward Location: WI Size: 200 MW COD: 2007 Interconnection: ATC Nelson CC Location: IL Size: 600 MW COD: Mid 2009 Interconnection: PJM White Oak Location: IL Size: 150 MW COD: Late 2007 Interconnections: MISO Gas-Fired Project Invenergy

Wind Development 101 p Wind turbines p Land p Interconnection agreement p A market for the energy p A market for the renewable energy credits Invenergy

Wind Intensity in the U. S. Invenergy

Wind Turbines p How big are they? n n p How are they put together n n n p Tower - 80 meters (about 25 stories) at the hub Blades – 38 meters (about 100 feet) long Concrete footing poured Three tower pieces assembled in place Three blades attached to the hub and lifted into place How fast do they turn? n 16 RPM (one rotation every four seconds) Invenergy

Land Use p Wind farms and agriculture are very compatible n n p Wind farms require from 50 – 100 acres per turbine, with a typical wind farm comprising of 100 turbines When completed, each turbine only removes 0. 25 acres from production Hosting a wind farm greatly benefits the community n n Tax base increased by ~ $2. 5 MM per turbine Affected landowners receive compensation through easement and waiver agreements Invenergy

Interconnection Agreement p p p The interconnection agreement allows for the generator to interconnect to the electric transmission system This process is one of the most time consuming steps of the development process: In recent experience, neither PJM nor MISO has been able to adhere to these timelines Invenergy

Marketing the Energy and RECs p p How wind energy and RECs are sold varies by market In less actively traded markets, energy and RECs are sold under long term contracts to load serving utilities n n n p Contracts typically 20 – 25 years long Pricing fixed for the term Common in CO and WI In more actively traded markets, energy and RECs are often sold separately n n Energy sold into power pool Energy price risk managed through commodity risk managers, typically for 10 years RECs sold to load serving entities Common in TX and PJM Invenergy

Impact of HB 1871 p On May 3 rd, the IL House passed a bill providing for a renewable portfolio standard (RPS) for IL n n n p Sets a requirement that 25% of IL’s energy requirements are met by renewables by 2025, with implementation beginning in 2007 Requires in state generation through 2011 Protects ratepayers through caps on rate impacts Clear ratemaking requirements will be critical to its implementation n n Provides for 20 year power purchase agreements Provides for the Commission to review and approve solicitation processes Invenergy

U. S. Renewable Portfolio Standards MN: 25% by 2025; *WA: 15% by 2020 (Xcel: 30% by 2020) VT: RE meets load growth by 2012 ME: 30% by 2000; 10% by 2017 goal - new RE WI: requirement varies by utility; 10% by 2015 goal MT: 15% by 2015 MA: 4% by 2009 + 1% annual increase RI: 15% by 2020 CT: 10% by 2010 IA: 105 MW CA: 20% by 2010 ☼ NV: 20% by 2015 ☼ AZ: 15% by 2025 ☼ CO: 20% by 2020 (IOUs) *10% by 2020 (co-ops & large munis) *NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) ☼ NY: 24% by 2013 IL: 8% by 2013 ☼ NJ: 22. 5% by 2021 ☼ PA: 18%¹ by 2020 *MD: 7. 5% by 2019 *DE: 10% by 2019 ☼ DC: 11% by 2022 TX: 5, 880 MW by 2015 Solar water heating State RPS HI: 20% by 2020 State Goal ☼ Minimum solar or customer-sited requirement * Increased credit for solar or customer-sited ¹PA: 8% Tier I / 10% Tier II (includes non-renewables); SWH is a Tier II resource Invenergy

Comparison on State RPSs Invenergy

Meeting the IL RPS through Wind Invenergy

Proposed IL Wind Projects Source - AWEA Invenergy

Summary p Wind energy can contribute significantly to serving Illinois’ energy supply needs going forward p HR 1871 sets a high, but attainable, goal for renewables in IL, and will play a leading role in meeting it p In order to meet that goal, developers, ISO’s, landowners, utilities, and those that oversee them will have to work together Invenergy

Questions? Invenergy