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Wind Energy: a critical solution to climate change

Net Zero Cities ForumOctober 23, 2013

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Content

• The case for wind

• Vestas’ role

• Involving consumers

Why wind? Today wind has what it takes to meet energy demands of the future

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Biomass

Hydro

Solar

Wind

Competitive – low cost of energy1

Predictable – business case certainty2

Independent – stable electricity supply

Fast – short ramp-up time

Clean – few emissions, no water usage and 85 % recyclability

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Cost of Energy, USD/mwh0 50 100 150 200 250 300

Solar

Biomass

Wind

Coal and gas

Ramp-up-time, years

0

Nuclear

Coal

Solar

Wind

20.00010.000

Water cons., liters / 5 mwh

0 100 200

Coal

Biomass

Nuclear

Wind

GHG-emission, gCO2/kwh

85%ROI- Predictable revenue

- Stable costs

- Proven technologies

Indicative wind business case

Business Case Certainty

- No borders

- No wind scarcity

- No geopolitical disputes

Power Independence

Note: * Minor water usage for cleaning purposes in wind and solar energySources: New Energy Finance (2009), Singapore IEW conference (2009), WEF (2009), EWEA (2009), Vestas Global Marketing & Corporate Relations department.

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Fair Comparison: Wind is clearly the more attractive option

• Wind has the lowest external costs of all energy technologies

Onshore wind energy Nuclear Fossil fuels

Decommissioning Social cost

Environmental cost OPEX

CAPEX

Source: Direct costs compiled from EER 2009 and 2010 and IEA 2010. Indirect costs compiled and/or calculated based on data from EPA 2011, World Bank 2011, and Stern Review 2006. Fossil fuel data based on supercritical coal and CCGT gas technologies. Wind energy data based on onshore wind plants. Nuclear data is pre-Fukushima, based on new-build using generation III technology.

Cost of Energy (averages)• The benefits of wind energy

• Predictable• Independent• Fast• Clean• Competitive

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Water savings with wind

Throughout its full lifecycle, wind energy uses less water than other power generating technologies require just for electricity generation.

According to the LCA of the Vestas V112 turbine, the total water footprint amounts to 27.7 l/MWh – corresponding to 4% of the water needed to generate 1 MWh in a wet-cooled Natural Gas Combined Cycle (NGCC) plant*

* Data does not account for the water required to build the gas plant or for the water consumption of gas extraction and processing.

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Wind energy already benefits Colorado

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Wind energy already installed in Colorado avoids carbon emissions equivalent to taking 715,000 cars off the road and saves 1,490,000,000 gallons of water per year.

Colorado has been a leader in wind energy: 11% of the state’s electricity mix is supplied by wind.

There are over 4,000 Coloradoans employed in wind energy in 17 factories and the industry has invested over $4 billion of capital investment into the state.

Wind industry pays $7.5 million each year to landowners who lease their property for turbines.

Net Debt/EBITDA

2007 2008 2009 2010 2011-800

-600

-400

-200

0

200

400

600

800

-2.0x

-1.5x

-1.0x

-0.5x

0.0x

0.5x

1.0x

1.5x

2.0x

-1.82x

-0.05x

-0.29x

0.78x

1.79x

Net debt Net-debt to EBITDA (RHS)

xxxxxxxWhat’s Vestas doing?

Made in the USABlades, towers and nacelles

Vestas established four North American

manufacturing facilities in Colorado as well

as other operations to support the business,

including a regional spare parts and tools

warehouse in Denver.

By building and centrally locating its North

American factories, Vestas’ customers,

business partners and suppliers benefit from

lower logistical costs, improved response

time and customized solutions.

Today, over 70% of a Vestas wind turbine

is made domestically. In addition the factories

have exported components to Mexico,

Canada, Brazil and Europe.

COLORADO

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Industry-leading track record in turbine developmentVestas’ track record of turbine evolution over 33 years is unmatched in the wind industry

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Vestas is reducing the Cost of Energy

HigherEnergy

Production

LowerCAPEX

LowerOPEX

Business Case Certainty

Dedicated low wind designs: A modern V100-1.8 produces 18% more energy compared to a V90-2.0 MW at 7.0 m/s on a 100 MW site

Flexible Load & Power Modes ensure maximum production on complex sites

Lost Production Factor for Vestas turbines has continuously declined and is now below 2%

The continuously increasing capacity of our turbines results in fewer foundations, roads, cablings etc. for MW constrained sites

Advances in load control has lead to lighter towers and smaller foundations

Lower overall park maintenance cost on MW constrained sites due to fewer turbines to maintain and twice as long service intervals (once per year compared to previously every 6 months)

Vestas cutting edge offerings SiteHunt® and SiteDesign® reduce uncertainty in the wind resource assessment and guarantees that our customers get the maximum possible output from each turbine

Vestas initiatives

reducing Cost of Energy

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Energy Transparency: Changing the world’s energy mix

85% of consumers worldwide want more renewable energy.

62% of consumers worldwide would prefer to purchase brands produced using wind energy.

Source: 2012 Global Consumer Wind Study

The Energy Transparency Initiative brings a novel perspective on the interface between climate change and the corporate world.

Shedding light on how the private sector is part of the solution to climate change, not the problem, the Energy Transparency Initiative reaches out to consumers, corporations, and institutions to incite much needed action on climate change.

A growing number of private-sector players have already embarked on this journey to a more sustainable economy. Through the Energy Transparency campaign, Vestas has set out to recruit new corporate pioneers for this journey.

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WindMade™

By Vestas for the people

WindMade™ is the first global consumer label that identifies products and companies made with wind energy.

The objective behind WindMade is to drive demand for wind power, to boost investment and growth of the renewable energy market.

Developed and funded by Vestas, WindMade is today its own NGO with more than 70 members. Pioneer WindMade companies include brands such as Motorola, LEGO and Deutsche Bank.

“WindMade is probably the most unique communication innovation made in the wind business in the last 30 years.”

Denise BodeFormer AWEA CEO

Susan InnisSenior Manager, Public Affairs(303) 655-5534suinn@vestas.com

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