The document discusses the proposed Tarnita Lapustesti Pumped Storage Hydro Power Plant project in Romania. It notes that the project would be approximately 1 billion euros in size, utilize mature pumped storage technology, and help provide energy security and balance renewable energy on Romania's national power system. The project involves constructing reservoirs at Lapustesti and Tarnita with a total installed capacity of 1000 MW.

1. 2015 Hidro Tarnița S.A. all rights reserved

2. INVESTMENT CONSIDERATIONS
WHY ROMANIA ?
- EU member
- NATO member
- Strong macro indicators
- Well qualified work force
WHY Tarnita Lapustesti Pumped Storage ?
- Sizeable project – approx. EUR 1 Billion
- Romania lacks pumped storage capacities
- Location - regional provider of energy security
- Mature technology - 99% from total storage ;
- Quick NPS balancing
- Clean technology;
- Good financials
WHY ENERGY SECTOR?
- Mature market with room to grow
- Access to EU Energy Union
- Key sector of economy
- Regional leadership role Romania
- Regulated sector
2015 Hidro Tarnița S.A. all rights reserved

3. PROJECT LOCATION
2015 Hidro Tarnița S.A. all rights reserved
Balance point and
storage point for Wind
Farm Energy on the NPS
Relative equal distances
from 2 nuclear power plants,
Cernavoda in Romania, Pecs
in Hungary or Kozlodui in
Bulgaria

4. ROLE AND ADVANTAGES
Renewables
Dispatchable consumer
Black start
Energy Storage
NPS security
Sustainable development
Clean source
2015 Hidro Tarnița S.A. all rights reserved

5. ROLE AND ADVANTAGES
 Hydroelectric parameters:
- NWL upper reservoir, Lapustesti storage 1,086.00 masl
- NWL lower reservoir, Tarnita storage 521.50 masl
- Mean gross head 564.50 m
- Total installed flow in turbine mode 212.00 m3/s
- Total installed flow in pump mode 152.00 m3/s
- Total installed capacity 4 x 250 MW reversible
- Pumping cycle weekly
- Energy produced in generator mode 1,649 TWh/year
- Energy consumed in pump mode 2,103 TWh/year
Estimated investment cost: 966 mil. Euro
Estimated construction period: 5-7 years
*Data from the feasibility study drawn up and updated by ISPH PD SA in 2014.
2015 Hidro Tarnița S.A. all rights reserved

6. © 2015 Hidro Tarnița S.A
DESCRIPTION AND MAIN CONSTRUCTIVE
CHARACTERISTICS OF THE DEVELOPMENT SCHEME

7. TECHNICAL DATA - OVERVIEW
© 2015 Hidro Tarnița S.A

8. MACROECONOMIC INVESTMENT APPROACH
2015 Hidro Tarnița S.A. all rights reserved
Similar
investments
opportunity
7% gross dividend yield Electrica shares (2014)
6,28% yield USD 30 years T-bills
5,80% coupon rate for USD 15 years T-bills
5,3% gross dividend yield Fondul Propietatea shares (2014)
8% IRR for equity shares in hydro project (Tarnița – Lăpuștești PSHPP)
Source: Public information and Tarnita Feasibility Study
Good technical solution
Proven feasibility
Mature Technology
Sustainability
Green field project
Project
bankability
Economic growth
especially on local level
Energy security
national security
component

9. NATIONAL POWER SYSTEM
2015 Hidro Tarnița S.A. all rights reserved
Coal
27%
Oil&Gas
23%
Hydro
27%
Wind
12%
Biomass
0%
Solar
5%
Geothermal
0%
Nuclear
6%
Total Installed Capacity (April 2015) – 24.555 MW
Coal
Oil&Gas
Hydro
Wind
Biomass
Solar
Geothermal
Nuclear
Resources
 Coal
 Nuclear
 Hydro
 Gas
 Wind & Solar
Challenges
 Network capacity,
 increased share of RES
 Interconnections
 Energy price
 Phasing out of existing plants

10. © 2015 Hidro Tarnița S.A* Source: TRANSELECTRICA S.A.
NATIONAL POWER GRID - CONNECTION
Elements of NPS connection are:
- 400 kV substation
- PSP double circuit line 400 kV – Mintia (158 km);
- PSP double circuit line 400 kV– Cluj Gădălin (74 km).
- 400 kV ring to be closed with Tarnita PSHPP node – investment of Transelectrica S.A.

11. TOTAL INSTALLED CAPACITY EVOLUTION ON TYPE OF RESOURCES
2015 Hidro Tarnița S.A. all rights reserved

12. RENEWABLES DEVELOPMENT
2015 Hidro Tarnița S.A. all rights reserved
Puterile instalate si disponibile intre anii 2010-2014
EOLIAN
0.000
200.000
400.000
600.000
800.000
1000.000
1200.000
1400.000
1600.000
1800.000
2000.000
2200.000
2400.000
2600.000
2800.000
01.01.2010
20.10.2010
01.01.2011
10.03.2011
01.06.2011
01.08.2011
01.11.2011
01.01.2012
01.06.2012
07.09.2012
24.10.2012
07.12.2012
01.01.2013
01.04.2013
01.07.2013
01.10.2013
01.12.2013
01.01.2014
01.03.2014
01.04.2014
Pi,Pd [MW]
Pi
Wind installed capacity
Puterile instalate si disponibile intre anii 2010-2014
FOTOVOLTAIC
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
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850
900
950
1000
1050
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1150
1200
01.01.201020.10.201001.01.201110.03.201101.06.201101.08.201101.11.201101.01.201201.06.201207.09.201224.10.201207.12.201201.01.201301.04.201301.07.201301.10.201301.12.201301.01.201401.03.201401.04.2014
Pi,Pd [MW]
Pi
Solar installed capacity

13. INVESTMENTS IN ENERGY FIELD
2015 Hidro Tarnița S.A. all rights reserved
Foreign direct
investment in energy
sector 2008 - 2012
Investments evolution on
resources 2011 - 2013

14. ENERGY POLICIES AND STRATEGY
2015 Hidro Tarnița S.A. all rights reserved
European energy policy OBJECTIVES Competitiveness :
Affordable and
competitive prices;
Improved energy
efficiency; Promotion of
new technologies, growth
and jobs
Security of energy
supply: Diversification of
energy sources, supply
countries and routes;
Grid Stability; Adequate
energy infrastructures
Sustainability : Reduction of
emissions; Reduction of energy
consumption; Development of
alternative energy sources
National energy strategy
 Keeping a diversified and well balanced energy mix
 Increasing energy security by new generation units and by using the national potential for new energy sources
 Developing nuclear energy, essential to achieving decarbonisation targets;
 Using the potential of energy efficiency
 Encouraging investments and building an attractive and predictable environment for investors
 Prudent and sustainable development of renewable energy, in a cost-effective manner, with an emphasis on the
sustainable biomass potential
 Keeping coal as an important energy resource for ensuring our energy security
 Sustaining clear regulations for vulnerable consumers in the context of the energy price increases
 Taking advantage of the national geographical and energy potential
 Consolidating the management of the state companies from the energy sector

15. DRIVERS OF INVESTMENTS
2015 Hidro Tarnița S.A. all rights reserved
European energy policy OBJECTIVES
Policy
Sustainability Security
Bankability
Environment
Main objective of the WFD
is to prevent deterioration of
the water bodies status
Energy
Reduction of CO2 emissions
Directive 2009/28/EC
renewable source encouragement
Usage of
existing
facilities for
Hydro Power
generation

16. ENERGY POLICIES AND STRATEGY
2015 Hidro Tarnița S.A. all rights reserved
 Investment opportunities include:
Development of new
production
Rehabilitation of
operating units
Strengthening
interconnections
Balancing NPS
Secure the proper operation
of the National Grid
considering the impact of
the renewable energy
Areas of development
Investments need according
to Romanian Energy
Strategy 2015 – 2035
100 billion euro

17. NATIONAL STRATEGIC PROJECTS
2015 Hidro Tarnița S.A. all rights reserved
Nuclear
• Cernavoda NPP
Units 3 and 4 –
New Nuclear Build
• Cernavoda NPP
Unit 1 – LTO
Project considered
for 2022-25
Hydro
• Pump Storage
Hydro Power Plant
Tarnita – Lapustesti
• Turnu-Magurele –
Nicopole HPP (in
cooperation with
Bulgaria)
Coal
• Mintia TPP
Rehabilitation
(hard coal)
• New Unit at
Rovinari TPP
(lignite)
REGIONAL DEVELOPMENT
 Enhancing interconnections with the neighboring countries - Moldavia, Bulgaria, Serbia, Hungary
 Market coupling

18. © 2015 Hidro Tarnița S.A
Lapustesti plateau view
Lapustesti plateau viewTarnita Dam
TARNIŢA – LĂPUŞTEŞTI

19. 2014 Hidro Tarnița S.A. all rights reserved
Ovidiu Demetrescu
CEO
contact@hidrotarnita.ro
www.hidrotarnita.ro
Telefon: +40 21 313 83 29
Fax: +40 21 313 51 30