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Europæiske energiselskaber 25 May 2010 Welcome to "After Work Meeting": The US Cleantech Market - Emerging Trends and Opportunities for Danish Companies May 25th, 2010

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Market opportunities for Danish cleantech companies in the American market

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Page 1: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Welcome to "After Work Meeting":

The US Cleantech Market- Emerging Trends and Opportunities for

Danish Companies

May 25th, 2010

Page 2: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Welcome

Nicolai Sederberg Rottbøll

Head of Secretariat

Copenhagen Cleantech Cluster

Page 3: Opportunities in the us cleantech market

OPPORTUNITIES IN THE US

CLEANTECH MARKET25 MAY 2010

26.05.2010 CPHCLEANTECH.COM

[email protected]

T: +45 3322 0222

Page 4: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Opportunity Spotting for Danish Companies

in the American CleantechMarket

Giles Jackson, PhD., Associate Professor, Byrd School of Business

Page 5: Opportunities in the us cleantech market

Giles Jackson

Page 6: Opportunities in the us cleantech market

“Summing up, it is clear the

future holds great opportunities.

It also holds pitfalls. The trick

will be to avoid the pitfalls, seize

the opportunities -- and get back

home by six o'clock”

Woody Allen

Page 7: Opportunities in the us cleantech market

“WORK IN PROGRESS”

Page 8: Opportunities in the us cleantech market

Climate Mitigation Initiative. http://cmi.princeton.edu/wedges/

2010 McKinsey

Study: 100%

renewables is

feasible by 2050.

Page 9: Opportunities in the us cleantech market

Q: How do we grow a slither into a wedge?A: “New Industrial Revolution” (Dr. Steven Chu)

2010 EIA study: US energy supply = 48.3% coal, 20.5% natural gas, 1.2% petrol fired plants, 20.1 nuclear, 6.1% hydro, 3.7% renewables. Av. price 9.35c/kWh.

Utility industry spent 0.17% of sales on R&D 2003-2006. DOE R&D down from $6 billion 1978 to $1.8 billion 2004.

2009 Federal budget allocated just 8.2% of $147 billion R&D budget to all energy, general science, natural resources, environmental research and green buildings.

The bad news: Fossil fuel companies outspent renewables companies by 7-to-1 in lobbying services, Q1 2010 (Center for Responsive Politics).

The good news: States are forging ahead regardless. Green stimulus funds (US will spend 18% of $248 billion 2010).

Page 10: Opportunities in the us cleantech market

Goal: reduce global warming pollution to 95.25 % of 2005

levels by 2013, 83 % of 2005 levels by 2020, 58 percent of

2005 levels by 2030, and 17 % of 2005 levels by 2050.

APA is ―crucial to the success of American entrepreneurship‖

- John Doerr, venture capitalist

INTRODUCED MAY 11

Page 11: Opportunities in the us cleantech market

CLEANTECHNUCLEAR ENERGY $50bn in loan

guarantees, but storage issue unresolved. Rash of lawsuits filed by states.

OFFSHORE OIL/GAS States can veto drilling

up to 75 miles from shore.

COAL (CARBON CAPTURE) 80% projected increase

in cost of energy. Duke Energy’s 612MW plant (ready in 2012) will cost $2.88 billion.

Dr. Chu: goal is to reduce to 20-25% over current cost within 10 years.

FOSSIL FUELSRENEWABLE ENERGY Clean Energy Technology Fund; $5bn clean

energy manufacturing tax credit. But no Renewable Electricity Standard.

VEHICLES & TRANSPORTATION National Transportation Low Emissions

Energy Plan; Clean Vehicle Technology Fund; tax incentives for fleet conversion; mandatory targets/standards for states and metro areas (boosting urban transit).

BIOFUELS National Academies of Sciences to study

how different sources of biomass can contribute to energy independence, protect the environment and reduce global warming pollution.

CAP & TRADE Cap and trade system with introductory

carbon price of $12, increasing 3% annually. Ceiling set at $25, increasing 5 % over inflation annually. Utilities start in 2013 and other industries 2016.

APA

Today: no level carbon playing field.

Page 12: Opportunities in the us cleantech market

The strategy to appease powerful special interests and lure Republicans failed. Idea of raising price of energy unpopular given fragile recovery … add to that Climategate and diminished credibility of the IPCC. … with more Republicans expected in November.

“It goes without saying that a cap and trade law –or, better, an outright carbon tax – is needed, and eventually it will happen. After healthcare, nobody should say the chances of reform in 2010 are nil, but the odds look long.”

Financial Times, May 17

Page 13: Opportunities in the us cleantech market

TRENDS & OPPORTUNITIES

Page 14: Opportunities in the us cleantech market

57% of US energy is wasted in production, distribution and consumption. A top priority is doing more with less. With guidance from the CCC, our study* profiled 45 US firms in four areas:

E-Vehicles – Pike Research projecting > 600,000 vehicles next 5 years. 12 contenders at the brink of commercialization. Chevy Volt, Coda Automotive (fall 2012), Tesla S Sedan (IPO), Nissan Leaf, etc.

Biofuels and materials – DOE wants a commodity. Advanced biofuels need investment. Biofuels could supply 58% of US fuel needs (2005 US government study). Three phases: (I) waste fuels 2010, (II) Jatropha 2014, (III) algae based fuels 2016 (Pike Research).

Smart grid – like the pre-Internet (lack of standards). Needs a platform, power storage to level the load, and high-voltage transmission lines. Huge shortage of manpower is projected. DOE has given $3.4 billion for 100 grid projects, which will rise to $8.1 billion (earth2tech.com).

Green homes & smart buildings – buildings are responsible for 2/5 of carbon. Innovation driven by building code reform, tax incentives and rebates (Energy Star, Home Star & soon Building Star), tightened standards for appliances, aging housing stock and better information, e.g. energy information on appliance labels.

*Co-authored with Morten King-Grubert & Lasse Becker, with student assistance

Page 15: Opportunities in the us cleantech market

In 2009, 1125 patents filed with US Patent & Trademark Office. Biomass/biofuel up 260%; solar 60%; fuel cells and hybrid/EVs 20%; wind and geothermal flat; hydro/tidal in decline (Clean Energy Patent Growth Index).

In 2009 USPTO launched the fast-track program to speed up the patent process for 3,000 already-filed patents.

Eligible patents required to focus on one of four areas: environmental quality, renewable energy development, energy conservation or greenhouse gas emissions reductions.

Page 16: Opportunities in the us cleantech market

Total clean energy investment reached $27.3 billion in Q1, down from $31.6 billion Q4 ‘09, but more than the $20.8 billion in Q1 ’09 (Bloomberg).

Venture investment showed strongest Q1 of all time with $1.9 billion invested, up 83 % from Q1 ‘09.

Corporate direct investment up 140 % from Q4. Utility investments in renewable power and smart grid.

Capital scarce and costly; large scale debt financing limited to proven technologies, leaving start-ups dependent on more costly equity financing.

Early stage ventures increasingly seeking corporate partnerships to escape Valley of Death. E.g. biofuels.

Energy efficiency has become a magnet (faster and more reliable returns), boosted by the Home Star Energy Retrofit Act of 2010 (invests $6 billion over two years).

Page 17: Opportunities in the us cleantech market

FEDERAL

Page 18: Opportunities in the us cleantech market

Qualified firms receive 30% cash grant from US Treasury in lieu of Production Tax Credit (PTC) or Investment Tax Credit (ITC). Reduces dependence on scarce tax equity.

$2.6 billion was disbursed as of March 1 2010, creating 4250MW of new renewables capacity: 86% ($2.2 billion) went to 40 large wind projects (almost

3900MW; 20% of total installed capacity in 2009) 6% went to 10 geothermal projects (137MW) 4.5% went to 302 solar projects (61MW) 2.8% went to 8 biomass projects (130MW) 0.5% went to 4 landfill gas projects (20.5MW) 0.1% went to 2 fuel cell projects (1.3MW) $883,009 went to 20 small wind projects (0.7MW)

2010 DOE/LBNL report deemed program a success.

Page 19: Opportunities in the us cleantech market

$400 million earmarked for high-risk “moonshot” technologies (2009-2011).

Round I: $51 million went to 37 firms (out of 3600). Winning teams are required to share at least 10 percent of the project costs.

Round II: $106 million in grants announced April 30. $34.6 million allocated to 10 projects developing energy storage tech for plug-in vehicles. In addition, 13 projects working on electrofuels (e.g. converting hydrogen and CO2 into motor fuel) got $41.2 million.

Round III: Innovative Materials and Processes for Advanced Carbon Capture Technology (IMPACCT), Batteries for Electrical Energy Storage in Transportation (BEEST), Innovations in Electrofuels.

Page 20: Opportunities in the us cleantech market

Cooperative Agreement: Smart Grid Research, Development,and Demonstration

FOA Number: DE-FOA-0000313Issue Date: Friday, April 16, 2010Total Funding Available: $30 millionCost Sharing: 20% for R&D projects; 50% for demonstration projects

Highly adaptive protection and control systems are needed to enable smart grid functionality. This announcement consists of three (3) areas of interest addressing the need to develop: Integrated distribution management systems for distribution

automation Advanced sensing, monitoring, and control technologies for

enhanced asset utilization and grid reliability Voltage regulation and overvoltage protection for high

penetration of renewable generation

CASE STUDY SMART GRID RFP (DOE)

Page 21: Opportunities in the us cleantech market

STATE

Page 22: Opportunities in the us cleantech market

VOLUNTARY MARKET:DISCRETIONARY

COMPLIANCE MARKET:MANDATORY

Pike Research, 2010

Scenario 1 (no federal renewable portfolio standard): 50% growth by 2015 (11.5% CAGR).

Scenario 2 (with 15% standard in all 50 states): 300% growth by 2015 (329 million MWh).

Scenario 1 (sluggish economic growth): 8.6% CAGR

Scenario 2 (normal economic growth 2-2.5%): 17.2% CAGR

Page 23: Opportunities in the us cleantech market

CASE STUDY

California’s electricity use per-capita has remained relatively stable last 35 years.

By 2020 all new homes in California will be zero net energy. By 2030 all commercial buildings will be zero net energy.

California has $3.8 billion in rate payer funding for its energy efficiency programs 2010-2012, the largest in the world except China. It has a $78 million budget to fund emerging tech.

Utilities not penalized for “selling less” and incentivized to offer value-added services.

On the horizon: distributed generation meet target of 33% renewable energy by 2020 (feed in tariff for projects up to 20MW).

Utilities that want to finance innovation with ratepayer dollars have to go through the public utilities commissions.

CALIFORNIA

Page 24: Opportunities in the us cleantech market
Page 25: Opportunities in the us cleantech market

NREL is on a steep incline (2000 people up from 1200 two years ago; supercomputing complex for smart grid apps being built; full slate of additional infrastructure plans funded by Recovery Act).

NREL has expressed interest in exploring potential partnerships with Danish cleantech firms (Cooperative R&D Agreements, technical services agreements, licensing, etc).

Important event: 23rd Annual Industry Growth Forum, Oct 19-21.

NREL

pioneered the

National

Alliance of

Clean Energy

Business

Incubators

Page 26: Opportunities in the us cleantech market

SBIR was established to meet the research and development needs of the federal agencies by providing funding to small businesses to stimulate technological innovation. http://www.oe.energy.gov/sbir.htm

Danish firms are eligible to participate but actual recipient must be 51% US-owned.

Small businesses that win an SBIR award retain the rights to any technology that they develop.

Page 27: Opportunities in the us cleantech market

… identify players operating within and between clusters who

can assist with exploration, market entry and development.

Source: nvc.vt.edu

Page 28: Opportunities in the us cleantech market

…leverage cluster knowledge, relationships and resources to get

basic questions answered.

Page 29: Opportunities in the us cleantech market

Bloomberg New Energy Finance: US emissions will be 0.4% below 2005 levels by 2020, and 2.0% below 2005 levels by 2030, even without new carbon reduction policies. A major “step-change” in clean energy technology, along with new, more aggressive policies will be needed. The longer the delay, the more costly it will be.

Properly positioned, Danish experience and know-how could “catalyze” this step-change.

Although the “low-hanging fruit” is not quite as close as we’d like, it’s also true that in America, practically anything is still possible.

Page 30: Opportunities in the us cleantech market

SPECIAL THANKS TO

Page 31: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Danish CleantechCompetences and Potential

Anders Stouge, Director

Danish Energy Industries Federation

Confederation of Danish Industry

Page 32: Opportunities in the us cleantech market

Anders Stouge 25. May 10

Anders StougeDirector

[email protected] Energy Industries Federation

Page 33: Opportunities in the us cleantech market

25. May 10Anders Stouge

Confederation of Danish Industry (DI)Committed Industry

•DI is a private organisation funded entirely by currently 11,000 companies

•DI aims to provide the best possible working conditions for the Danish industry

•DI has become a strong common voice for industry with a strong role in society.

•DI has a strong international strategy

33

Page 34: Opportunities in the us cleantech market

25. May 10Anders Stouge

DI and Trade Federations

34

Page 35: Opportunities in the us cleantech market

25. May 10Anders Stouge

• CRONTMIJ Carl Bro A/S

• COWI A/S

• DONG ENERGY A/S

• Vattenfall A/S

• SEAS-NVE

• TRE FOR

• SYD Energi Partner A/S

• Danfoss A/S

• Grundfos A/S

• Logstor A/S

• Siemens A/S

• ABB A/S

• Haldor Topsoe A/S

• Burmeister & Wain Scandinavian Contractor A/S

• BWE A/S

•Vestas Wind Systems A/S

• SolarCap A/S

• Semco Maritime A/S

35

Logstor A/S

Page 36: Opportunities in the us cleantech market

25. May 10Anders StougeDenmark has taken a great leap towards being a Bright Green Nation

with GDP growth, CO2 reductions and stable energy consumption

Page 37: Opportunities in the us cleantech market

25. May 10Anders Stouge

37

Denmark is now the leading energy technology

exporting nation in the EU

-10%

0%

10%

20%

30%

40%

50%

60%

0% 2% 4% 6% 8% 10% 12%

Catching Up Moving ahead

Share of total exports

Growth in exports share 2003-2008

Loosing momentumFalling behind

Exports to USA: 13% (2009)

Page 38: Opportunities in the us cleantech market

25. May 10Anders Stouge

US - don't miss the train!!

38

Source: Steven Chu, Secretary of Energy, EIA Energy Conference, 2010

Page 39: Opportunities in the us cleantech market

25. May 10Anders Stouge

Messages from Secretary Chu

"We can and must become the global leader in the clean energy economy of the future

America has the opportunity to lead the world in a new industrial revolution:

• To ensure American competitiveness,

• Decrease dependency on foreign oil,

• And mitigate climate change."

39

To achieve our clean energy goals, we need rapid, large-scale deployment of technology.

Technology deployment requires investment.

Investment flows toward opportunities for profit.

Market opportunities are structured by policy.

Source: EIA Energy Conference, 2010

Page 40: Opportunities in the us cleantech market

25. May 10Anders Stouge

US and emissions targets

40

Copenhagen Accord:17 percent below 2005levels by 2020.

2013: - 4,75% 2020: - 17,0%2030: -42,0%2050: -83,0%Below 2005 levels

See: http://kerry.senate.gov/americanpoweract/intro.cfmCame out May 12, 2010

Page 41: Opportunities in the us cleantech market

25. May 10Anders Stouge

US - Annual Energy Outlook 2010Total energy use

41

Page 42: Opportunities in the us cleantech market

25. May 10Anders Stouge

US - Annual Energy Outlook 2010Electricity production by source

42

Page 43: Opportunities in the us cleantech market

25. May 10Anders Stouge

US - Annual Energy Outlook 2010Electricity production and renewables

43

Page 44: Opportunities in the us cleantech market

25. May 10Anders StougeA large part of electricity production worldwide is still

produced from fossil fuels, emitting CO2

Page 45: Opportunities in the us cleantech market

25. May 10Anders StougeSmart Grid, Denmark and The US

Page 46: Opportunities in the us cleantech market

25. May 10Anders Stouge

Where to focus?

Energy

Energy

Population

Population

GDP

GDPCOCO 22

22 COCO

Energy

CO

GDP

Energy

Population

GDPPopulationCO 2

2

46

(1)

(2)

(3)

Demography Wealth EnergyIntensity

CarbonIntensity

Kaya Identity

Page 47: Opportunities in the us cleantech market

25. May 10Anders Stouge

47

Energy

CO

GDP

Energy

Population

GDPPopulationCO 2

2

EnergyIntensity

CarbonIntensity

May be influenced by choice of technology and instruments

Difficult to influence

Demography

Wealth

Efficient energy generation

Highly efficient gas and steam turbines Coal carbon capture storage (CCS) Cogeneration …

Switch to renewables Wind Biomass Solar …

Efficient energy distribution Smart grid High-voltage DC transmission systems Distributed heating and cooling systems …

Efficient energy consumption Fuel efficient vehicles Building technology measures Energy saving lighting Energy saving equipment Energy Management …

Innovative solutions for reduction of CO2 emissions

Where to focus?

Page 48: Opportunities in the us cleantech market

25. May 10Anders Stouge

48

1990

2000

2008

2025 2030

CO2-udledningen reduceres med 50 pct.

Givet BNP og befolkning i 2030

0

10

20

30

40

50

60

70

80

0 100 200 300 400 500 600 700 800 900

Da

nm

ars

k u

ds

lip

af

CO

2 i

fo

rho

ld t

il

bru

tto

en

erg

ifo

rbru

ge

t K

g/G

J

Danmark bruttoenergiforbrug i forhold til BNP(GJ/kr.)

Vejen til lavere udslip af CO2 kræver stort fokus på energieffektiviseringer og CO2-venlig teknologi

Kilde: Danmarks statistik, Energi Styrelsen og DI Energibranchen

CO2-udslip nedbringes ved mere CO2-venlige teknologier

CO2-udslip nedbringes ved energieffektiviseringer

Hvad er det samfundsøkonomiske byttefold mellem energiintensitet og CO2-intensitet?

Har indflydelse på hvordan den ønskede CO2-reduktion opnås, og om det er ensamfunds-økonomisk optimal sti der betrædes

Hvilken betydning har det for forsyningssikkerhed?- på kort sigt- på længere sigt

The case of DenmarkCarbon Intensity vs. Energy Intensity

Energy Intensity

Carb

on

Inte

nsity

Page 49: Opportunities in the us cleantech market

25. May 10Anders Stouge

How much will sales prices change if energy

prices double?

49

0

2

4

6

8

10

12

14

pe

r ce

nt

Energy-price sensitivity , whole Economy

Energy -price sensitivity, industry

Denmark

Taking into account direct and indirect use of energy (input-output calculations)Source: Danmarks Nationalbank, Monetary Review 2nd Quarter

Page 50: Opportunities in the us cleantech market

25. May 10Anders Stouge

Heat/power production ► Most efficient plants ► Energy efficiency

0

0,2

0,4

0,6

0,8

1

1,2

1,4

1,6

1,8

20 25 30 35 40 45 50 55 60

Efficiency percentage

Ton CO2 pr.

MWh

World (average)

Most efficient power

plant in Denmark

In the future through

research and development

Page 51: Opportunities in the us cleantech market

25. May 10Anders StougeDenmark produces a large proportion of its CO2-free

electricity from solar, wind, geothermal and biomass

In 2020 renewable energy sources will account for at

least 30% of total Danish final energy consumption

Page 52: Opportunities in the us cleantech market

25. May 10Anders StougeDanish companies are among the world leaders in

developing and commercialising new energy competences

Page 53: Opportunities in the us cleantech market

25. May 10Anders Stouge

European Climate Foundation - Roadmap 2050The costs of 80% RES in 2050 similar to BAU

53

Very important to focus on common EU finance mechanism For RES and the right common framework for building and financing transmissions line - else the calculations will not hold

Page 54: Opportunities in the us cleantech market

25. May 10Anders Stouge

Smart energy systems will curtail the costs

54

Kilde: European Climate Foundation

Page 55: Opportunities in the us cleantech market

25. May 10Anders Stouge

Environmentally friendly and intelligent infrastructures are essential

for achieving the necessary CO2 reductions and secure energy

supplies in every region of the world

Page 56: Opportunities in the us cleantech market

25. May 10Anders Stouge

Fostering RETs’ transition towards mass market integrationM

ark

et D

eplo

yment

TimeDevelopment Niche markets Mass market

Imposed market risk, guaranteed but declining minimum returnPrice-based: FIPQuantity-based: TGC with technology banding

Stability, low-risk incentivesPrice-based: FIT, FIPQuantity-based: Tenders

Continuity, RD&D, create market attractivenessCapital cost incentives: investment tax credits, rebates, loan guarantees etc.

Stimulate market pullVoluntary (green) demand

Low cost-gap technologies (e.g. wind onshore)

High cost-gap technologies (e.g. PV)

Mature technologies (e.g. hydro)

Prototype & demonstration stage technologies (e.g. 2nd

generation biofuels)

Technology-neutral competitionTGCCarbon trading (EU ETS)

Note: The positions of the various technologies and incentive schemes along the S-curve are an indicative example at a given moment. The actual optimal mix and timing of policy incentives will depend on specific national circumstances. The level of competitiveness will also change in function of the evolving prices of competing technologies.

Page 57: Opportunities in the us cleantech market

25. May 10Anders Stouge

Page 58: Opportunities in the us cleantech market

25. May 10Anders Stouge

U.S. anchor companies

Page 59: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Danish Business Case in the American Cleantech Market

Michael Zarin

Director, Government Relations

Vestas

Page 60: Opportunities in the us cleantech market

Michael Zarin, Vestas Wind Systems A/S

Wind Energy, Vestas, and

U.S. Cleantech

Page 61: Opportunities in the us cleantech market

61 | Vestas Wind Systems A/S, 25 May 2010

VESTAS STARTED THE WIND INDUSTRY

AND WE ARE HERE TO STAY- We installed our first wind turbine in 1979

Page 62: Opportunities in the us cleantech market

62 | Vestas Wind Systems A/S, 25 May 2010

What we do…

A new value chain focused on customers

Page 63: Opportunities in the us cleantech market

63 | Vestas Wind Systems A/S, 25 May 2010

OUR MAIN TASK IS TO SERVE OUR CUSTOMERS

- Business Case Certainty

- Cost of Energy

- Easy to Work With

Page 64: Opportunities in the us cleantech market

64 | Vestas Wind Systems A/S, 25 May 2010

WE OFFER OUR CUSTOMERS THE

BROADEST PRODUCT RANGE

Constantly improving efficiency on platforms.

Competitive and predictable cash flows.

3MW

Platform

V90

V112

2MW

Platform

V80

V82

V90

V100

6MW

Platform

KW

Platform

V52

V60

Page 65: Opportunities in the us cleantech market

65 | Vestas Wind Systems A/S, 25 May 2010

OUR QUALITY IS CONTINUOUSLY IMPROVING

- The generating effect of Vestas turbines has grown 100-fold in 30 years

- In 2010 our aim is to reach Five Sigma

Page 66: Opportunities in the us cleantech market

66 | Vestas Wind Systems A/S, 25 May 2010

WIND, OIL AND GAS

Our vision is to put wind on a par with oil and gas.

Page 67: Opportunities in the us cleantech market

67 | Vestas Wind Systems A/S, 25 May 2010

From Vision to Reality

Page 68: Opportunities in the us cleantech market

68 | Vestas Wind Systems A/S, 25 May 2010

This is not about Quarters

– it’s about Years.

Page 69: Opportunities in the us cleantech market

69 | Vestas Wind Systems A/S, 25 May 2010

Vestas’ Global Manufacturing Footprint

Norway

Kristiansand: Nacelles Castings

Spain

Olvega: Controls

León: Nacelles Assembly

Vivero: Nacelles Assembly

Damiel: Blades

Germany

Lübeck: Generators

Magdeburg: Nacelles Castings

Lauchhammer: Blades

Sweden

Lidköping: Nacelles Castings

Guldsmedshyttan: Nacelles Castings

Denmark

Lem: Blades

Controls

Nacelles Machining

Skagen: Nacelles Machining & Hubs

Varde: Towers

Rudkøbing: Towers

Ringkøbing: Nacelles Assembly

Viborg: Nacelles Assembly

Hammel: Controls

Nakskov: Blades

China

Tianjin: Nacelles Assembly

Blades

Generators

Controls

Nacelles Machining

Xuzhou: Nacelles Casting

Hohhot: V60 Factory Complex

(Blades, Controls, Nacelles Assembly)

Italy

Taranto: Nacelles Assembly

Blades

India

Chennai: Nacelles Assembly

USA

Pueblo, CO: Towers

Windsor, CO: Blades

Brighton, CO: Blades

Nacelles Assembly

Page 70: Opportunities in the us cleantech market

70 | Vestas Wind Systems A/S, 25 May 2010

Our Biggest Markets are in Europe, US, Asia

Page 71: Opportunities in the us cleantech market

71 | Vestas Wind Systems A/S, 25 May 2010

Globally Installed Wind Power Capacity

2003-2009

GWEC, 2010

Page 72: Opportunities in the us cleantech market

Vestas and the U.S. market

Page 73: Opportunities in the us cleantech market

73 | Vestas Wind Systems A/S, 25 May 2010

In the region, for the region – U.S. market

Sourcing Nacelles Blades Towers Service &

MaintenanceR&D

Sales and

HQ

•Chicago, IL •Brighton,CO•Brighton,CO•Windsor, CO •Pueblo, CO •Brighton, CO

•Houston, TX

•Boston, MA

•Brighton, CO

•Portland, OR

+ rep offices

Page 74: Opportunities in the us cleantech market

74 | Vestas Wind Systems A/S, 25 May 2010

We know of no other

company in our industry

that invests* more in

the US than we do.

* ~ USD 1 Billion

Vestas is the largest Job Creator in the US wind industry:

Page 75: Opportunities in the us cleantech market

75 | Vestas Wind Systems A/S, 25 May 2010

Vestas:

Supplying the U.S. market

Source: American Wind Energy Association and Vestas Wind Systems A/S

Ramping up in Colorado

Blades, Brighton

Towers, Pueblo

Nacelles, Brighton

• North America manufacturing base – four factories in

Colorado

• Sourcing office in Chicago – North America supply

chain in areas such as castings, metal fabrication,

composites, gears, bearings, and electro-mechanical

components

• Some of our main suppliers have established

themselves in the U.S.

• Suppliers are qualified through PPAP (Production Part

Approval Process)

• Process is highly rigorous

• Some examples of qualified suppliers have been in

machining, sheet metal, weldings and wiring

Page 76: Opportunities in the us cleantech market

76 | Vestas Wind Systems A/S, 25 May 2010

Recovery underway… new challenges emerge

• Strong five-year North American industry forecast

• 2009 an active year, driven by pre-crisis financing and power purchase agreements

• Vestas ramping up for continued market growth

• U.S. approves >$1billion in ITC Grants to developers

• Capital infusions may allow developers to initiate new projects

• First indications that Congress may be open to extending program in 2011

• Policy environment relatively good, but much work remains

• National renewable energy standard would drive near-term investment

• Energy and climate legislation could also provide a boost

• Some state renewable energy requirements being challenged, but holding ground

• Green Energy Act in Ontario and transmission expansion in Alberta boost Canadian

outlook

• Ontario domestic production requirements – making the best of an unfortunate

policy

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Principle Challenges

• Wholesale power prices low; affects prices for power purchase agreements for wind and other sources

• Recession reduces overall U.S. demand for electricity by 6.5%

• Low natural gas prices, as unconventional gas supplies reach market while consumer demand falls

• Wildlife concerns could hamper siting of projects in parts of U.S.• E.g., Wyoming ban on wind in Sage Grouse Core Areas, may extend to other western states

• Public opposition to utility-scale wind growing in some parts of U.S. and Canada

• Increasing press coverage of noise and purported health concerns

• Transmission access is a challenge in much of the best wind regimes

• Challenge is both physical access as well as cost to get on line

• U.S. Manufacturers Tax Credit is over subscribed

• Some political pressure to increase local content requirements

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THANK YOU FOR YOUR ATTENTION

Copyright Notice

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in any form or by any means—such as graphic, electronic, or mechanical, including photocopying, taping, or information storage and retrieval systems without the prior written permission of Vestas Wind Systems

A/S. The use of these documents by you, or anyone else authorized by you, is prohibited unless specifically permitted by Vestas Wind Systems A/S. You may not alter or remove any trademark, copyright or other

notice from the documents. The documents are provided ―as is‖ and Vestas Wind Systems A/S shall not have any responsibility or liability whatsoever for the results of use of the documents by you.

Vestas wishes to acknowledge and respect all copyrights in connection with the illustrations used in this presentation. In case we have unintentionally violated copyrighted material, we want to be informed

immediately in order to straighten things out and thus to honour any obligatory fees.

Page 79: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Q&A

Page 80: Opportunities in the us cleantech market

Europæiske energiselskaber

25 May 2010

Networking and Snacks