Offshore Wind in the UK January, 2010
EDPR s debut in offshore wind and UK market Selected in the UK Round 3 to develop 1.3 GW of wind offshore capacity Expanding in size in a new technology and a new market establishing a platform for future projects Entering in a market with a well established regulatory framework and sustainable attractive returns Partnering with a Scottish offshore wind company leveraging on its strong technical expertise and local presence Expecting to get key consents in 2013/14 and begin construction and operation between 2015 and 2020 Important step enhancing EDPR s future growth options 1
UK is today the leading offshore wind market... UK: the biggest offshore wind market... (MW by YE2008 (1) )...with an increasing public and political support 598 Market Share Awarded GW 409 32 241 166 110 1.5 7.3 UK Denmark Netherlands Sweden Other 39% 27% 16% 11% 7% UK Round 1 UK Round 2 UK Round 3 2001 2003 2009/10 With the UK Round 3 a total of 41 GW of wind capacity have been awarded to be developed on UK waters (1) Source: EER - Global Offshore Wind Energy Markets and Strategies: 2009 2020 2
and offers attractive returns supported by a well established regulatory framework UK (1) : Compulsory Renewable Energy Quota (%) 14.4% 13.4% 15.4% Renewable Obligation Order was recently extended until 2037 Remuneration: wholesale price + ROC (2) +LEC (3) 10.4% Tradable ROCs per MWh produced: wind offshore is entitled to receive 1.5 ROC/MWh (2 ROC/MWh if projects pojectsaeco are commissioned sso eduntil March ac 2014) Electricity suppliers have to redeem ROCs or pay the buy-out price (defined and indexed to CPI) 2010 2013 2014 2015 Avg. 2009 price 124/MWh: wholesale price of 43/MWh; 1.5x 51/ROC; LEC of 5/MWh Stable regulatory framework providing visibility over future cash-flows (1) Excluding Northen Ireland (2) Renewable Oblication Certificate (3) Levy Exemption Certificate 3
EDPR has partnered with SeaEnergy to participate in the UK Round 3, leveraging on complementary knowledge Partnership Structure to develop wind offshore sites in the UK to leverage on complementary expertise and develop a sustainable position in the offshore Local Presence + Renewables Limited Wind Assessment Offshore Develop. Offshore Engineering g 75% 25% Procurement Financing Moray Offshore Renewables Offshore Construction Operating SeaEnergy as a partner to deliver unrivalled offshore technical know-how and experience to the consortium 4
EDPR and SeaEnergy consortium was selected to develop 1.3 GW in the North of the UK UK Round 3 9 zones tottaling up to 32 GW EDPR and SeaEnergy Zone 1 1 Zone Development Agreement for 1.3 GW in Zone 1, located on the Smith Bank in the Moray Firth, Scotland (near other SeaEnergy projects) 2 Sites to be developed in transitional waters (30-60m of 3 depth) an at 25 km shore distance 9 4 Low level of administrative and environmental constraints expected on the development 8 5 Very high wind resource profile in Northern Scotland 7 6 EDPR to enter a new market and to develop new skills and capabilities 5
EDPR and SeaEnergy will first proceed with the study and development phase of the offshore project Award Project Development Consent Construction and Operation The Crown Estate awards Zone Partner Signing i of Zone Development Agreement Site identification Environmental and feasibility studies Wind resource analysis Apply for consents Obtain consents from competent t authorities Start construction Initiate operation Jan. 2010 2013 2015 2020 Success in the consent phase will give the option to start construction and operation 6
Consolidating leadership as a top global player Increasing medium-term profitable growth options 2 1 Enhancing portfolio diversificationifi Developing know-how and core competencies in new technology 4 Entering in a stable and supportive market 3 7
Annex
SeaEnergy to deliver unrivalled offshore technical know-how and experience to the partnership Expertise Focused on offshore wind farms with strong development experience in marine projects Strong in-country political establishment relationships Strong engineering and construction offshore expertise SeaEnergy: Beatrice Construction Offshore oil and gas heritage and first mover in intermediate waters offshore wind farms installation techniques Experience Champion of offshore renewables in Scotland First 5 MW turbines installed offshore, first deployment in deep water and first installation from a floating vessel Beatrice Expansion (25% of 920 MW, development) Beatrice (10 MW, operation) Inch Cape (25% of 905 MW, development) Presence in other offshore sites under development in Scotland (near Zone 1) 9