Clean Energy Investment Trends By Michael Liebreich Of New Energy Finance June 2008

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    Clean Energy Investment Trends By Michael Liebreich Of New Energy Finance June 2008 - Presentation Transcript

    1. Clean Energy Investment Trends REFF Wall Street Market Drivers Michael Liebreich Chairman & CEO new energy finance New York, 19th June 2008
    2. Total Global New Investment in Clean Energy 2004 2007 $148.4bn 1% of global fixed 60% asset investment Growth Clean energy 58% Growth asset finance is 76% $92.6bn 9.6% of global Growth energy $58.7bn infrastructure spend $33.4bn 2.5 times the size of commercial aircraft 2004 2005 2006 2007 investment sector Adjusted for reinvestment. Geared re-investment assumes a 1 year Source: New Energy Finance, IMF WEO Database, IEA WEO lag between VC/PE/Public Markets funds raised and re-investment in 2007, Boeing 2006 Annual Report projects. Grossed up value based on disclosed deals © new energy finance, 2008 2
    3. NEX vs. AMEX Oil, NASDAQ and S&P 500 2003 - 2007 500 NEX AMEX Oil NASDAQ S&P 500 450 400 350 300 250 200 150 100 50 0 30 Dec 02 30 Dec 03 30 Dec 04 30 Dec 05 30 Dec 06 30 Dec 07 Index Values as of 09 June 2008 Source: New Energy Finance, Bloomberg © new energy finance, 2008
    4. NEX vs. AMEX Oil, NASDAQ and S&P 500 crunch! Credit 500 NEX AMEX Oil NASDAQ S&P 500 450 400 350 300 250 200 150 100 50 0 30 Dec 02 30 Dec 03 30 Dec 04 30 Dec 05 30 Dec 06 30 Dec 07 Index Values as of 09 June 2008 Source: New Energy Finance, Bloomberg © new energy finance, 2008
    5. Total public markets transactions, Q1 2004 Q1 2008 $12.8bn Secondary IPO $5.4bn $5.3bn$5.2bn $4.3bn $3.9bn $3.7bn $2.0bn$1.9bn Convertible & Other $1.5bn $1.4bn $1.2bn $1.0bn $0.9bn $0.2bn $0.4bn $0.1bn $0.1bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Main markets only. OTC markets include with VCPE figure Source: New Energy Finance © new energy finance, 2008
    6. Total asset financing transactions Q1 2004 Q1 2008 $37.1bn $30.5bn $27.8bn Acquisition $24.7bn $24.9bn $19.1bn $16.5bn Refinancing $15.3bn $15.8bn $14.3bn $13.4bn $9.0bn$9.1bn $7.8bn New build $5.8bn $4.4bn $3.3bn$3.8bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Grossed up values based on disclosed deals. Source: New Energy Finance © new energy finance, 2008
    7. Venture capital and private equity for companies, Q1 2004 Q1 2008 $4.7bn $3.7bn $3.5bn $3.5bn PIPE/OTC $3.4bn $2.9bn PE Buy-out $2.5bn $2.5bn $2.1bn $1.9bn PE Expansion Capital $1.6bn $1.5bn $1.4bn $1.2bn $1.2bn VC Late Stage $0.6bn $0.4bn VC Early Stage $0.2bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Grossed up values based on disclosed deals. Source: New Energy Finance © new energy finance, 2008
    8. NEX vs. AMEX Oil, NASDAQ and S&P 500 crunch! Credit 500 NEX AMEX Oil NASDAQ S&P 500 450 400 350 300 250 200 150 100 50 0 30 Dec 02 30 Dec 03 30 Dec 04 30 Dec 05 30 Dec 06 30 Dec 07 Index Values as of 09 June 2008 Source: New Energy Finance, Bloomberg © new energy finance, 2008
    9. Total public markets transactions, Q1 2004 Q2 2008 INDICATIVE Q2 2008 VALUE $12.8bn Secondary IPO $5.4bn $5.3bn$5.2bn $4.3bn $3.9bn $3.7bn $2.0bn$1.9bn Convertible & Other $1.5bn $1.4bn $1.2bn $1.0bn $0.9bn $0.2bn $0.4bn $0.1bn $0.1bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Main markets only. OTC markets include with VCPE figure Source: New Energy Finance © new energy finance, 2008
    10. Venture capital and private equity for companies, Q1 2004 Q2 2008 INDICATIVE Q2 2008 VALUE $4.7bn $3.7bn $3.5bn $3.5bn PIPE/OTC $3.4bn $2.9bn PE Buy-out $2.5bn $2.5bn $2.1bn $1.9bn PE Expansion Capital $1.6bn $1.5bn $1.4bn $1.2bn $1.2bn VC Late Stage $0.6bn $0.4bn VC Early Stage $0.2bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Grossed up values based on disclosed deals. Source: New Energy Finance © new energy finance, 2008
    11. Total asset financing transactions Q1 2004 Q2 2008 INDICATIVE Q2 2008 VALUE $37.1bn $30.5bn $27.8bn Acquisition $24.7bn $24.9bn $19.1bn $16.5bn Refinancing $15.3bn $15.8bn $14.3bn $13.4bn $9.0bn$9.1bn $7.8bn New build $5.8bn $4.4bn $3.3bn$3.8bn Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 '04 '04 '04 '04 '05 '05 '05 '05 '06 '06 '06 '06 '07 '07 '07 '07 '08 '08 Grossed up values based on disclosed deals. Source: New Energy Finance © new energy finance, 2008
    12. Eurozone wind farm financing rate, Euribor rate and ECB official rate 8% ECB rate Fed rate Euribor US Libor Total rate including spread Total rate including spread 7% 6% 5% 4% 3% 2% 1% Jan 2007 Apr 2007 Jul 2007 Oct 2007 Jan 2008 Apr 2008 Source: New Energy Finance © new energy finance, 2008
    13. US wind farm financing rate, US Libor and Fed funds rate 8% Fed rate US Libor Total rate including spread 7% 6% 5% 4% 3% 2% 1% Jan 2007 Apr 2007 Jul 2007 Oct 2007 Jan 2008 Apr 2008 Source: New Energy Finance © new energy finance, 2008
    14. Yields on tax equity in affordable housing and wind projects 2007 - 2008: % 7.00% 6.50% 5.75% 5.00% Affordable Housing tax yields PTC yields Summer 2007 Summer 2008 Anecdotal evidence based on interviews with tax equity investors and wind project developers. Source: New Energy Finance © new energy finance, 2008
    15. USD denominated contracts, Q4 2002- Q12008: Sample Size and $m/MW 12 1.4 Number 1.3 Price 10 38% rise in prices 1.2 Q4 '06- Q1'08 1.1 8 1.0 6 0.9 0.8 4 0.7 0.6 2 0.5 0 0.4 Q4 003 Q3 004 Q2 005 Q3 006 Q2 004 Q4 005 Q2 007 Q1 002 Q2 003 Q3 003 Q4 004 Q1 004 Q3 005 Q1 005 Q2 006 Q1 006 Q3 007 Q4 007 Q1 007 8 Q4 006 Q1 003 00 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 _2 Q4 Notes: 10 point rolling average, averaged by quarter of contract signing. Where no data points Source: Companies, New Energy Finance present, previous value from the previous quarter is usd © new energy finance, 2008
    16. Wind turbine supply lead times April 2001 - March 2008 25 20 15 10 5 0 Sep '02 Mar '03 Oct '03 Apr '04 Nov '04 May '05 Dec '05 Jul '06 Jan '07 Aug '07 Feb '08 Lead times 30pt rolling avg Notes: Trend line reflects 30point rolling average beginning in April 2001. Lead times are based on expected start of delivery, less date of contract signed. Source: New Energy Finance © new energy finance, 2008
    17. Reported US wind project power prices: $/MWh 7% 40.0 100 Increase $36.0/MWh Number of reporting projects (RH) $33.5/MWh Weighted average price (LH) 90 35.0 80 Electricity price ($/MWh) 70 30.0 60 50 25.0 40 30 20.0 20 10 15.0 0 Average 2003 Average 2007 Q4 Q4 Q4 Q4 Q4 06 03 04 05 07 20 20 20 20 20 Notes: Prices are average of reported quarterly contract prices weighted by volume of Source: Federal Energy Regulatory electricity. Reporting projects exclude projects connected in ERCOT zone. Commission, New Energy Finance Desktop © new energy finance, 2008
    18. NEX vs. Wind Sector 240 Turbine Manufacturer (6) 220 200 NEX Wind 180 (15) 160 NEX (89) 140 Developer/ Power Generator (7) 120 100 80 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Index Values as of 19 May 2008 Source: New Energy Finance, Bloomberg © new energy finance, 2008
    19. Projected solar silicon production by tier, 2006- 2011 ktonnes 147 118 80 Silicon Tier 3 49 Silicon Tier 2 27 19 Silicon Tier 1 2006 2007 2008 2009 2010 2011 Methodology explained in Research Note, “The cell maker’s dilemma: When will the silicon shortage ease?”. Based on data  Source: New Energy Finance, and assumptions updated in February 2008.  2008 © new energy finance, 2008 
    20. 2006 US biofuels bull run And investment shift to South America $13.1bn $8.7bn $6.9bn $4.2bn $4.0bn M&A/MBO $0.7bn $1.0bn $1.0bn New $0.2bn 2001 2002 2003 $0.04bn 2004 $0.2bn 2005 2006 investment 2007 VC/PE, Public Markets and Asset Finance only. Excludes re-investment adjustment. Source: New Energy Finance Grossed up value based on disclosed deals © new energy finance, 2008
    21. Biofuels contribution to food price increases, 2004 - 2007 Max price impact  of Biofuels  Grains  168%  + 8.1%  Food Oils  136%  + 17.0% Sugarcane  63%  + 2.7% Input cost  $ depreciation  Other Supply & Demand  Biofuels Base currency: US$ Source: New Energy Finance, USDA  © new energy finance, 2008
    22. Grain supply-demand drivers, 2004-2007: m hectares (% change of land use) Added land 20.2 (2.9%) Consumption habits 2.7 (0.4%) Animal feed -2.6 (-0.4%) Yield Increase -3.6 (-0.5%) Urbanisation -4.8 (-0.7%) 100%= 686m Hectares. Total net impact on Australia -6.6 (-1.%) land availability equivalent to -3.9% Biofuels -7.6 (-1.1%) Population -24.1 (-3.5%) Source: New Energy Finance, USDA © new energy finance, 2008
    23. Grain land use for ethanol production 2007 (k hectares) US EU 27 China 0 0 0 Rice Sorghu 0 0 0 m 0 172 137 Wheat 22 831 Corn 9,017 Source: New Energy Finance, USDA © new energy finance, 2008
    24. New Energy Finance New Carbon Finance www.newenergyfinance.com www.newcarbonfinance.com Michael Liebreich +44 20 7092 8803 michael.liebreich@newenergyfinance.com Decision support for your clean energy and carbon market investments

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