Executive Summary October 2010

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Executive Summary October 2010

  1. 1. Executive Summary October 2010 Proprietary Information
  2. 2. AGENDA • Integrated Energy Solutions Overview • Bio-Coal™ Intro • Power Plant Example • Competition • Target Customers • Market Assessment • Projected Revenues • Current Status
  3. 3. INTEGRATED ENERGY SOLUTIONS LLC • Founded in 2009 • Focused on Renewable Energy • Research and Development, Technology Licensing, Project Development, and Project Execution
  4. 4. INTEGRATED ENERGY SOLUTIONS LLC Officers and Executive Committee: Al Rettenmaier, President Tim Orrick, Esq., VP/General Counsel Advisory Committee: Dennis Huber, Chief Technology Officer, CenturyLink Telecommunications Bob Dunn, VP, JE Dunn Construction
  5. 5. INTEGRATED ENERGY SOLUTIONS LLC IES is Focused on Biomass Co-Firing for Coal Fired Power Plants Now….. • Algae – Bio-Coal™ Technology next up is…… • Wood Torrefaction - TorrWood
  6. 6. BIO-COAL™ IS ALGAE BIOMASS COFIRING • Produces No Cost Renewable Power in Existing Coal Fired Power Plants • Reduces Emissions • Meets Renewable Portfolio Standards (RPS) – at a Fraction of the Cost of Wind Energy 5000 gal Algae Growth Facilities at Chamois Power Plant in Missouri
  7. 7. BIO-COAL™ IS A SIMPLE SOLUTION  Cultivate/Grow Native Algae • No “Super Algae” • Simple Nutrients, No Manipulation • CO2 Supply from Air, Flue Gas or Other Source  Harvest the Algae  Feed the Algae/Coal Mixture to Power Plant
  8. 8. COAL INDUSTRY ISTURNINGTO ALGAE Recent Article on Algae Co-Firing: “Biomass - Getting Fired Up About Algae in PC Burners”, Modern Power System Magazine, Aug 2010 • Article Describes 10% Algae/ 90% Coal Test Burn by Siemens/PetroAlgae • Favorable Results including a 20% NOx Reduction!
  9. 9. BIO-COAL™ POWER PLANT EXAMPLE Sunflower Electric, Holcomb, KS • 360 MW Pulverized Coal Power Plant • Replace 10% of Coal with Algae Seambiotic Algae Growth Facility At a Coal Power Plant in Israel
  10. 10. BIO-COAL™ REPLACES COAL Sunflower 360 MW Example Before Bio- Coal™ After Bio- Coal™ Savings Coal Usage, tons/y 1,650,000 1,485,000 165,000 Coal Cost, $/y $49,368,000 $44,431,200 $4,936,800
  11. 11. BIO-COAL™ EMISSIONS REDUCTIONS Sunflower 360 MW Example Before Bio-Coal™ After Bio-Coal™ CO2 Emissions, tons/y 2,534,424 2,204,949 SO2 Emissions, tons/y 1,154 1,039 NOx Emissions, tons/y 3,926 3,141 Hg Emissions, tons/y 327 294
  12. 12. BIO-COAL™ EMISSIONS REDUCTIONS Sunflower 360 MW Example Emission Reduction with Bio-Coal™ Percent Reduction CO2 Emissions, tons/y 329,475 13% SO2 Emissions, tons/y 115 10% NOx Emissions, tons/y 785 20% Hg Emissions, tons/y 33 10%
  13. 13. COMPARISON OF BIO-COAL™ RENEWABLE ENERGYTO NEW WIND ENERGY
  14. 14. BIO-COAL™ RENEWABLE ENERGY Sunflower 360 MW Example Before Bio-Coal™ After Bio-Coal™ Renewable Megawatts 0 36
  15. 15. BIO-COAL™ CAPITAL COST VS WIND ENERGY Sunflower 360 MW Example Bio-Coal™ Wind Energy Equivalent Renewable Megawatts 36 109* Cost of Equivalent Renewable Megawatts $58,000,000 $218,000,000 *Includes capacity factor of 33%
  16. 16. BIO-COAL™ PRODUCTION COST VS WIND ENERGY Sunflower 360 MW Example Bio-Coal™ Wind Energy Renewable Electricity Cost, $/kWh $0.00* $0.04* *Includes Renewable Production Incentive, Biomass Credits and Emissions Reduction Credits
  17. 17. BIO-COAL™ INCENTIVES Numerous Biomass Incentives are Offered • American Clean Energy Leadership Act – ‘‘(G) allow triple credits for generation of energy from algae; • Renewable Electricity Production Tax Credit or Incentive - 2.1 ¢/kWh • US Dept of Treasury Renewable Energy Grant – 30% of qualifying facility cost • USDA Biomass - $45/ton
  18. 18. ALGAE HARVESTING COMPETITION Current State-of-the-Art Algae Harvesters Make Algae “Paste” – Not Fuel • Evodos – Advertising Energy Usage of 0.7 kWh/kg algae – Bio-Coal™ Uses 80% Less • Algaeventures Systems Inc. – New Technology HDD – makes “paste” • Bio-Coal™ Makes Fuel for Combustion
  19. 19. TARGET CUSTOMERS Coal Industry Segment Application Coal Power Plants On-site algae ponds, sequester CO2, harvest/combust algae for fuel replacement and emission reductions Coal Mines Enhanced coal value: Coal product with renewable component and reduced emissions Railroads New rail transport facilities for Bio-Coal™ Engineering/Construction Companies New algae growth and Bio- Coal™ harvesting facilities
  20. 20. BIO-COAL™ MARKET FACTORS • Climate – southern latitudes/warmer climates are best for algae growth • Renewable Portfolio Standards – states with RPS targets must have renewable energy • Available Land – algae farms need large tracts of relatively flat land • Existing Coal Fired Power Plants – the more existing coal plants, the larger the market
  21. 21. TARGET MARKETS BASED ON FACTORS In order of Existing Coal Power Plant Capacity: Texas, North Carolina, Missouri, Florida, Arizona, Oklahoma, Utah, Colorado, Virginia, Kansas, New Mexico, Nevada and California These states have a total of 100,000 MW of existing coal plants and a projected renewable energy build-out of 16,761 MW by 2025 (EIA- DOE) to meet existing RPS mandates
  22. 22. BIO-COAL™ MARKET SIZE • Survey of Power Plants in the Target States Indicates that 1 in 4 Existing Coal Power Plants are Favorable for Bio-Coal™ • At 10% Algae this Yields 2,500 MW of Algae Power Production • Total Investment Estimated at $4 Billion • Total Algae Production: 11,500,000 ton/yr
  23. 23. BIO-COAL™ MARKET SIZE Market Assessment: • 2,500 MW of Renewable Energy from Bio- Coal™ = Capital Cost of $4.0 billion • In 2008, $23 billion Spent in US for Renewable Energy (EPA Source) • Conclusion: This Level of Investment is Already Being Made
  24. 24. BIO-COAL™ MARKET SIZE Market Assessment: • 2,500 MW Renewable Energy from Bio-Coal™ • RPS Projected to Require 76,000 MW of Renewable Energy by 2025 – per Union of Concerned Scientists • Conclusion: Market is in Place for 15 Years
  25. 25. BIO-COAL™ MARKET SIZE Market Assessment: • US Coal Power Plants Use 1 Billion Tons of Coal per Year • 2,500 MW of Algae from Bio-Coal™ = 11,500,000 Tons of Algae • Algae Value of $500 Million Annually • Represents 1% of Coal Market
  26. 26. REVENUE PROJECTIONS • Assuming Capital Cost of $4 billion • Bio-Coal™ License Fees: $57 MM revenue • Equipment Supply: $800 MM revenue • Engineering: $200 MM revenue • Bio-Coal™Royalties: $2/ton or $23 MM/yr
  27. 27. INTEGRATED ENERGY SOLUTIONS LLC Current Status: • Developing Business Plan • Locking Up IP Long Term • Conducting Additional Proof of Concept Testing in University Laboratory • Looking for a Strategic Partner and Investor

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