World's Largest Solar Project

MOHAVE SUN POWER APRIL 1, 2009 Presented by: Mitchell Dong

SOLAR GRAND PLAN 2 Visionary plan for solar power to replace coal and gas Solar can provide 100% of US electricity Solar can drive an all electric car fleet Cut carbon emissions by 80% by 2050 Ken Zweibel of GWU author of Scientific American, Jan 2008 article CONFIDENTIAL

ENERGY FROM THE SUN 3 Data source: Wikipedia

DESERTS OF THE WORLD 4 Data source: www.geographyalltheway.com

EUROPE AND SAHARA DESERT 5 Data source: American Geological Institute

SOLAR RADIATION IN USA 6 Data source: NREL

DESERT ENERGY 7 4% of the US deserts could meet US electricity needs Desert Area Sq mi Solar Desert Area % of GWh/yr Served collectors Desert US SW US 20,000 500,000 4% 3,800,000 Sahara Europe 20,000 3,500,000 0.50% 3,300,000 Gobi China 15,000 500,000 3% 2,500,000 Kalahari Africa 3,000 360,000 1% 480,000 Australian Australia 1,000 600,000 0.30% 220,000 CONFIDENTIAL

OPERATING POWER PLANTS IN NORTH AMERICA 8 Data Source: Platts

US ELECTRIC TRANSMISSION GRID 9

NATURAL GAS PIPLINE NETWORK 10

NATIONAL HIGHWAY SYSTEM 11 Data Source: Wikipedia

EXISTING AND FUTURE INFRASTRUCTURE 12 160,000 miles high voltage electric transmission lines 300,000 miles of gas pipelines 50,000 miles in US highway system Estimated 50,000 miles of new transmission lines would be needed for solar from SW to all of US CONFIDENTIAL

COST OF IMPLEMENTATION IN US 13 Cents/kwh Annual cost Capital cost $/watt 15 cents $600 billion $6 trillion $9 10 cents $400 billion $4 trillion $6 5 cents $200 billion $2 trillion $3 Assumptions: 3,800,000 gwh / yr annual US consumption 10% cost of capital 15% conversion efficiency from sun to electricity Assumes cost of parabolic trough solar generation Assumes cost of molten salt storage Includes 50,000 miles of DC transmission lines CONFIDENTIAL

COST BENEFITS 14 New electric grid $365 billion / yr on oil expenditures (2/3 imported) = $250 billion / yr on oil imports $50 billion / yr on coal $100 billion / yr on natural gas CONFIDENTIAL

CUMULATIVE ENERGY SUPPLY 15 Investment of $26 trillion, or over $1 trillion/year, is needed, but the credit squeeze could delay spending, potentially setting up a supply-crunch once the economy recovers

SUM SOLAR GRAND PLAN 16 Bold but feasible In the past 50 years, we have built 300 coal fired plants 300 gas fired plants 100 nuclear plants 100 large hydro We can build 3000 new solar plants Now, an example of one such proposed plant CONFIDENTIAL

EXAMPLE: HUALAPAI VALLEY SOLAR PROJECT 17 Largest planned solar project in the world 340 MW with storage or equivalent of 500 MW without storage Obama’s stimulus package could finance the entire $2.1 billion project Proven technology: Parabolic Trough Experienced developer with track record CONFIDENTIAL

TECHNOLOGY OF SOLAR TROUGHS 18 Most mature of utility-scale technologies Longest track record (since 1984 in USA) Projects – operational Solar Energy Generating Systems (354 MW, CA, 1984-90) Nevada Solar One (64 MW, 2007) Projects – under construction Andasol 1-7 (50 MW each, Spain, first one online 2009) Solnova 1-5 (50 MW each, Spain) Extresol 1-3 (50 MW each, Spain) 10 other projects under construction in Spain, total 500 MW CONFIDENTIAL

PARABOLIC TROUGH – CLOSE UP 19 CONFIDENTIAL

PARABOLIC TROUGH – PANORAMA 20 CONFIDENTIAL

PARABOLIC TROUGH – AERIAL VIEW 21 CONFIDENTIAL

PARABOLIC TROUGH 22 Parabolic Trough with Drive Pylon Mirror Washing - Deluge Method Molten Salt Tanks Steam Turbine Assembling

PARABOLIC TROUGH – SCHEMATIC 23 CONFIDENTIAL

REGIONAL MAP OF SOUTHWEST US 24

HUALAPAI VALLEY SOLAR PROJECT 25

HUALAPAI VALLEY SITE 26

TRANSMISSION LINES AT SITE 27

SITE- HUALAPAI VALLEY 28 Proposed Transmission and Distribution Lines

PLANT LAYOUT 29

CAPEX 30 Total $2.1 billion, including the following: $1 billion in the solar collector field of mirrors, tubes, pipes $200 m in molten salt storage $120 m in heat transfer fluid $200 m in steam turbine generator and power block $75 m in balance of plant $ balance in EPC fees, contingency, land, interest during construction, owners costs, etc CONFIDENTIAL

EPC CONTRACT – POTENTIAL TERMS 31 Engineering, Procurement and Construction contract Key terms: performance, price & schedule Guarantees performance of entire plant Guarantees the completion date Fixed price, with possible commodity escalators Contingency for commodity price increases CONFIDENTIAL

POTENTIAL TEAM – CONSTRUCTION 32 Possible constructors include: Abengoa (Spain) Acciona (Spain) ACS / Cobra Group (Spain) MAN Solar Millennium (Germany) Black and Veatch (USA) Lauren Engineers and Constructors (USA) Fluor (USA) SNC Lavalin (USA) URS Washington Division (USA) CONFIDENTIAL

ENVIRONMENTAL PERMITS 33 Permits Required Federal NEPA process / EIS Arizona Corp Commission license Air Permit Aquifer Protection Permit Mohave County Zone change and special use permit CONFIDENTIAL

POWER PURCHASE AGREEMENT (PPA) – POTENTIAL TERMS 34 Take-or-pay contract Production of peak power – most desirable Thermal storage of 6-8 hours As available 95% capacity factor for summer peak 25-30 year term Power price to be determined in RFP competitive process Meets the utility’s renewable energy requirements Renewable Energy Credits (RECs) go to utility CONFIDENTIAL

POTENTIAL TEAM – POWER PURCHASERS 35 14 possible customers APS or Arizona Public Service LADWP or LA Dept Water & Power PGE or Pacific Gas & Electric Nevada Power (formerly Sierra Pacific Power) SCE or Southern California Edison SDGE or San Diego Gas & Electric SRP or Salt River Project TEP or Tucson Electric Power (Unisource) Southern California Public Power Agency (SCPPA) Northern California Public Power Authority Sacramento Municipal Utility District (SMUD) Western Area Power Administration (WAPA ) Bonneville Power Administration (BPA) Large industrial users or energy trading companies CONFIDENTIAL

FINANCING - EQUITY 36 30% solar ITC Refundable as a cash grant by Treasury Majority of equity for project CONFIDENTIAL

FINANCING - DEBT 37 DOE loan guarantee program for renewables $10 billion authorized under 2005 Energy Policy Act $60 billion added by Obama/Congress Up to 80% of project cost Federal Financing Bank 30 years at 3.5% Project Applied on Feb 26, 2009 CONFIDENTIAL

DEVELOPMENT BUDGET – PER SITE 38 $ 1,500,000 – Land options (24 months) $ 1,500,000 – Engineering, design (18 months) $ 1,000,000 – Environmental and permitting (18 months) $ 750,000 – PPA deposit, paid to the utility (12 months) $ 600,000 – Site prep, mapping, test and monitoring (6 months) $ 300,000 – Project management (24 months) $ 250,000 – Electrical studies (6 months) $ 250,000 – Legal (12 months) $ 6,150,000 per site (slightly less for 2nd and 3rd sites) Note: This does not include an estimated $ 15 million for PPA security deposit. This deposit, paid to the utility, can vary depending on the utility and negotiated PPA terms. CONFIDENTIAL

PROJECT SCHEDULE 39 Development Period: 2009-10 (1.5-2 years) Design and engineer facility - 3Q 2009 Secure all environmental approvals and permits - 2Q 2010 Negotiate PPA - 1Q 2010 Negotiate EPC - 2Q 2010 Financing Period: 2010 (0.5-1 year) Organize lenders and equity investors - 2Q 2010 Construction Period: 2010-13 (2.5-3 years) Install foundations and framing Assembly and installation of solar collectors Install steam cycle and power block Operations period 25 years, starting in 2013 CONFIDENTIAL

CLOSING 40 Largest planned solar plant in the world 340 mw solar trough project in the Mohave by 2013 $2 billion financing from stimulus money Solar industry can build 100 such plants in next 5-10 yrs Must bring cost down by 75% 3000 solar plants in next 10-20 yrs 10,000 solar plants globally in the next 20-40 yrs Small fraction of the Sahara, Gobi, Kalahari and Mohave deserts CONFIDENTIAL

CONTACT INFORMATION 41 Mitchell Dong Mohave Sun Power LLC ________________________________ 85 Hamilton Street Cambridge, MA 02139 Office: +1 617.864.3770 Fax: +1 617.864.2701 mldong@pgix.com Skype address: mldong141 CONFIDENTIAL

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World's Largest Solar Project

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