Windshare Windshare 20082008

AGMAGM

Welcome MembersWelcome Members

Windshare 2008 AGM

Welcome & IntroductionsWelcome & Introductions

2007 Windshare Board

Paula BoutisJohn BinnsRiki BurkhardtEvan FerrariJennifer JefferyRose KudlacStewart Russel

Treasurer - David Robertson

Introduction to:

Joanna SlezakRichard Lawrence

Deb Doncaster – Community Power Fund

Windshare 2008 AGM

Agenda Agenda (motion to approve agenda)(motion to approve agenda)

1. Welcome and Introductions2. Agenda Review3. Approval of minutes from 2007 AGM4. Recognition of Board & Staff: 5. Board Elections:6. WindShare Board Report – A year in Review:

a) Year Overview b) Administration

Coffee Break7. WindShare Board Report – Continued:

c) Technical and Production c) Technical and Production d) Financial Report

8. New InvestmentExPlace scenarios

9. Election Results 10. ADJOURNMENT 11. ANNOUNCEMENTS

Windshare 2008 AGM

“Energy and persistence alter all things.”

Benjamin Franklin

Windshare 2008 AGM

“The definition of insanity is doing the same thing over and over and expecting different results.”

Benjamin Franklin

Windshare 2008 AGM

APPROVAL OF MINUTES 2007 AGM

Riki BurkhardtRiki Burkhardt

Windshare 2008 AGM

RECOGNITION

Rose KudlacRiki BurkhardtPaula Boutis

Windshare 2008 AGM

BOARD ELECTIONS

Seven Member BoardThree year termsOpen to members and members in waitingThree vacancies to fill tonight

Dianne SaxEvan FerrariTed Tracewicz

Nominations from the floor?

Stewart Russell Stewart Russell

Windshare 2008 AGM

BOARD ELECTIONS

Each Candidate will have 2 minutes

Windshare 2008 AGM

BOARD ELECTIONS

-Can vote for up to three people-Election ballots to be submitted into Ballot Boxes-Ballots will be counted over Coffee Break

-Board can appoint new members during the year but must ratify new members at next AGM

Windshare 2008 AGM

WINDSHARE BOARD REPORT

WINDSHARE BOARD REPORT a) Year Overview b) Technical and Production c) Financial Report

Windshare 2008 AGM

WINDSHARE BOARD REPORT Overview of 2007Overview of 2007 Original Goal – multiple turbinesOriginal Goal – multiple turbines Environmental CO2 emission reductionEnvironmental CO2 emission reduction Board continues to look at ways of Board continues to look at ways of

increasing production reducing costs reducing our risk making us profitable.

Financial – not there yetFinancial – not there yet Challenging year for production and maintenance 1 turbine exposes us to higher financial risk while multiples reduce risk

Main Bearing issue - future Financials demonstrate the difficulties that this situation presents us

New Investments – trials and tribulationsNew Investments – trials and tribulations Lakewind – ExPlace Other possible opportunities

Windshare 2008 AGM

WINDSHARE BOARD REPORT What happened to Lakewind What happened to Lakewind Project?Project? Worked with TREC & Countryside Energy CooperativeWorked with TREC & Countryside Energy Cooperative

10 megawatt (5 turbine) project near Kincardine,

On hold for up to five yearsOn hold for up to five years Orange Zone - Ontario Power Authority (OPA) agreement Orange Zone - Ontario Power Authority (OPA) agreement

- Bruce Power - Bruce Power No new production unless generated at Bruce Nuclear Plant Many of you sent letters to the Minister of Energy decision to leave the Lakewind for another day was difficult

Windshare 2008 AGM

WINDSHARE BOARD REPORT Lakewind on Hold – Now What?Lakewind on Hold – Now What?

No potential new projectsNo potential new projects October, 2007 joint Visioning sessionOctober, 2007 joint Visioning session

Re-evaluate something close to home - ExPlace.

Windshare 2008 AGM

WINDSHARE BOARD REPORT More Tirbines at the Ex?More Tirbines at the Ex? Why more turbines at the Ex?Why more turbines at the Ex? 2005 feasibility add one turbine at ExPlace 2005 feasibility add one turbine at ExPlace

not financially feasible

Number of these issues have changed considerably Number of these issues have changed considerably since 2005, namely:since 2005, namely: Access to a long term contract - Standard Offer Program Guaranteed price for 20 years Turbine technology has improved

20% more efficient than our current turbine

Windshare 2008 AGM

WINDSHARE BOARD REPORT ExPlace Fasibility StudyExPlace Fasibility Study

ExPlace now receptive to 2 more turbines ExPlace now receptive to 2 more turbines (electricity self sufficiency by 2015)

Toronto Hydro very interested in joint ventureToronto Hydro very interested in joint venture Has potential to move quicker than Lakewind Has potential to move quicker than Lakewind Good working relationships with all associated Good working relationships with all associated

with this development and locationwith this development and location

Windshare 2008 AGM

WINDSHARE BOARD REPORT ExPlace Fasibility StudyExPlace Fasibility Study

Enabled us to conduct Feasibility study:Enabled us to conduct Feasibility study: 1) Continuing to operate only one turbine 1) Continuing to operate only one turbine 2) Adding two more turbines at ExPlace2) Adding two more turbines at ExPlace

Windshare 2008 AGM

E1E1

E2E2

Proposed Wind Turbine LocationsProposed Wind Turbine Locations

04/02/0804/02/08

Windshare 2008 AGM

Administrative CommitteesAdministrative Committees

Joint Venture (WindShare & Toronto Hydro)Joint Venture (WindShare & Toronto Hydro) Rose Kudlac, John Binns, Stewart Russell, Evan Ferrari

Technical Committee Technical Committee Rose Kudlac & John Binns, Stewart

Finance Committee Finance Committee (David Robertson, looking for new treasurer)

Communications Committee Communications Committee Jennifer Jeffery

Admin Admin Riki Burkhardt

Windshare 2008 AGM

Windshare Windshare 20082008

AGMAGM

Coffee BreakCoffee Break

Windshare 2008 AGM

WINDSHARE BOARD REPORT

John Binns

Technical and ProductionTechnical and Production

Windshare 2008 AGM

Production/TechnicalProduction/TechnicalExhibition Place Turbine•Lagerwey LW52 wind turbine •Installed Dec 2002, energy generation Jan 2003•Rotor diameter 52m, Hub height 60m•600 kW capacity (de-rated), direct drive, gearless model •AC-DC-grid AC converter •Normal rotation speed 24.5 rpm •2.5 m/s minimum wind threshold for blade rotation •Approximately 500 kilowatts energy production in winds of 11 m/sec •At 95% availability potential maximum energy generated 5,000,000KwH per year•Average energy generated 1,000,000KwH per year•4,000,000 KwH achieved June 2007

Windshare 2008 AGM

Energy RevenueEnergy Revenue

WS fiscal year October-SeptemberWS fiscal year October-September Power Purchase Agreement (PPA) Jan 2003-Power Purchase Agreement (PPA) Jan 2003-

Dec 2006-$0.0969/KwHDec 2006-$0.0969/KwH Hourly Ontario Energy Price (HOEP) Jan Hourly Ontario Energy Price (HOEP) Jan

2007-27 April 20072007-27 April 2007 Renewable Energy Standard Offer Renewable Energy Standard Offer

Programme (RESOP) 27 April 2007 onwards-Programme (RESOP) 27 April 2007 onwards-$0.11/KwH$0.11/KwH

Windshare 2008 AGM

Sep-March

701,963

866,003

946,342962,316

626,250

464,314

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

2003 2004 2005 2006 2007 2008

Year over Year ProductionWindshare Turbine

Kw h

Windshare 2008 AGM

Cumulative Production Windshare Turbine

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Kwh

2003

2004

2005

2006

2007

2008

2003 - - - 33,350 142,352 234,454 345,088 456,436 523,192 589,838 622,399 701,963

2004 71,407 183,920 291,097 431,322 493,860 572,351 673,755 747,825 806,404 832,930 855,426 866,003

2005 119,043 219,466 368,612 455,239 533,101 614,604 698,449 749,425 793,247 839,062 893,746 946,342

2006 49,757 196,400 351,285 486,321 622,141 695,292 741,951 803,486 861,529 920,771 954,815 962,316

2007 14,143 34,871 99,556 121,706 231,308 358,584 480,448 510,257 533,956 540,327 582,010 626,250

2008 63,295 136,460 242,884 388,656 464,314

1 2 3 4 5 6 7 8 9 10 11 12

Windshare 2008 AGM

Production by Fiscal MonthWindshare Turbine

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

Oct Nov Dec Jan Feb Mar Apr Ma Jun Jul Au Sep

Kwh

2003

2004

2005

2006

2007

2008

Windshare 2008 AGM

Production TechnicalProduction Technical

Technical Management Joint Venture Committee

WindShare – Evan Ferrari, Rose Kudlac, [Dave Robertson], Stewart Russell, John Binns

THESI –Jack Simpson, Leo Guidolin, Joyce MacLean Bettink NV McDowell Electrical WS Technical Committee-volunteers

Technical communication Online operations log (Yahoo)– captures information to

create a database of incidents and their resolutions

Windshare 2008 AGM

Future ChallengesFuture Challenges

Main bearing replacement (crane rental)Main bearing replacement (crane rental) OverheatingOverheating LWMS (Shoebox)LWMS (Shoebox)

Windshare 2008 AGM

““Sagging cables”Sagging cables”Replacement of power cable Replacement of power cable clampsclamps 9 x 3 component sandwich clamps, holes 9 x 3 component sandwich clamps, holes

drilled to 1” rather than 2.5cm diameterdrilled to 1” rather than 2.5cm diameter Slippage of up to 20cm between clampsSlippage of up to 20cm between clamps Single prototype machined and drilled, Single prototype machined and drilled,

installed to test for slippage.installed to test for slippage. New clamps machinedNew clamps machined Replaced over 3 Sundays, finished Jan 27, Replaced over 3 Sundays, finished Jan 27,

20082008 Cost $450 for 9 clamps, labour $0 Cost $450 for 9 clamps, labour $0

Windshare 2008 AGM

Windshare 2008 AGM

Windshare 2008 AGM

Windshare 2008 AGM

Windshare 2008 AGM

WINDSHARE BOARD REPORT Treasurers ReportTreasurers Report

Dave Robertson

Windshare 2008 AGM

Treasurer’s ReportTreasurer’s Report

Audited Financial StatementsAudited Financial Statements Balance Sheet Operations statement

Income TaxIncome Tax FY 2008 ForecastFY 2008 Forecast

Windshare 2008 AGM

Treasurer’s ReportTreasurer’s Report

Auditors:Auditors: Cowperthwaite Mehta Chartered Accountants

Windshare 2008 AGM

Treasurer’s ReportTreasurer’s Report

Fiscal Year – Oct 1, 2006 to Sept 30, 2007Fiscal Year – Oct 1, 2006 to Sept 30, 2007 Low income because:

Large amount of down time for repairs Paid at market rates not RESOP or original 9.67 cent per Kwh.

High operating costs to recover from downtime High operating costs direct result of no warranty Low overhead expenses Negative operating income Refunds to shareholders for shares not replaced Significant reduction in cash Cash shortage funded by EC loans

Windshare 2008 AGM

Balance SheetBalance SheetAssets (page 1)Assets (page 1)

Current AssetsCurrent Assets 20072007 20062006

CashCash $169,305$169,305 $169,788$169,788

Accounts ReceivableAccounts Receivable 18,57218,572 67,21067,210

Inventory –partsInventory –parts 10,02710,027 10,02710,027

Prepaid expensesPrepaid expenses 17,03917,039 16,70616,706

TOTALTOTAL $214,943$214,943 $263,731$263,731

Windshare 2008 AGM

20072007 20062006

Capital AssetsCapital Assets 615,984615,984 $657,264$657,264

Funds held in escrowFunds held in escrow 291,503291,503 307,066307,066

TOTALTOTAL $1,122,430$1,122,430 $1,228,061$1,228,061

Windshare 2008 AGM

Balance SheetBalance SheetLiabilities/Equity (page 1)Liabilities/Equity (page 1)

Current LiabilitiesCurrent Liabilities 20072007 20062006Accounts Payable & Accrued LiabilitiesAccounts Payable & Accrued Liabilities $9,422$9,422 $17,793$17,793Current Portion DebtCurrent Portion Debt 150,000150,000 150,000150,000Deferred RevenueDeferred Revenue 75,00075,000 75,00075,000

TOTAL CURRENT LIABILITIESTOTAL CURRENT LIABILITIES 234,422234,422 242,793242,793

PHASE II FUNDS IN ESCROWPHASE II FUNDS IN ESCROW 291,503291,503 307,066307,066

Member EquityMember EquityMembers’ Equity Share CapitalMembers’ Equity Share Capital 776,423776,423 786,923786,923Accumulated DeficitAccumulated Deficit (179,918)(179,918) (108,721)(108,721)

TOTAL MEMBER EQUITY TOTAL MEMBER EQUITY $596,505$596,505 $678,202$678,202

TOTALSTOTALS $1,122,430$1,122,430 $1,228,061$1,228,061

Windshare 2008 AGM

Debt FinancingDebt Financing

Environment CanadaEnvironment Canada Loans Loans $150,000 loan 0% interest Continuing to negotiate reuse of funds in next

project

Windshare 2008 AGM

Members’ Equity and Funds in Members’ Equity and Funds in EscrowEscrow(page 1)(page 1)

Members’ EquityMembers’ Equity 20072007 20062006

Preference SharesPreference Shares $776,000$776,000 786,500786,500

Membership SharesMembership Shares 423423 423423

Funds in EscrowFunds in Escrow 20072007 20062006

Preference SharesPreference Shares 291,503291,503 307,066307,066

Membership SharesMembership Shares 193193 202202

Windshare 2008 AGM

Balance SheetBalance SheetLiquidity Liquidity

Negative working capital $<19,479> (2006, $20,938).

Working capital decreased by operating loss.

Windshare 2008 AGM

Statement of OperationsStatement of Operations

Total energy delivered to the grid for Sept. 30, 2007 Total energy delivered to the grid for Sept. 30, 2007 year end was 626,250 KWH (2006; 946,342 kWh) year end was 626,250 KWH (2006; 946,342 kWh) (50% WindShare’s)(50% WindShare’s)

IssuesIssues Downtime reduced revenue Low rate reduced revenue High operating expenses

No warranty Local electrical contractor Brought in Bettink from Europe Regular maintenance by electrical contractor Management on site no longer volunteer

Windshare 2008 AGM

Statement of Operations Statement of Operations Revenues (page 2)Revenues (page 2)

RevenueRevenue 20072007 20062006Power Sales & Power Sales & Management FeesManagement Fees

$18,977$18,977 $46,621$46,621

Windpower Production Windpower Production Incentive ($0.12/kWh)Incentive ($0.12/kWh)

3,2903,290 5,7595,759

Interest & Exchange gainInterest & Exchange gain 7,7257,725 8,2428,242

TotalTotal $22,267$22,267 $60,622$60,622

Windshare 2008 AGM

Statement of Operations (page Statement of Operations (page 2)2)

ExpensesExpenses 20072007 20062006Turbine O&MTurbine O&M $30,817$30,817 $24,472$24,472

InsuranceInsurance 9,3299,329 9,8839,883

Land LeaseLand Lease 1,0001,000 1,0001,000

Realty taxesRealty taxes 3,8503,850 5,7985,798

Professional FeesProfessional Fees 7,6797,679 17,05717,057

Office expensesOffice expenses 6,7126,712 5,3255,325

Interest & Bank ChargesInterest & Bank Charges 522522 424424

TotalTotal $59,909$59,909 $63,959$63,959

Windshare 2008 AGM

Statement of Operations Statement of Operations Operating Income & Net Loss Operating Income & Net Loss (page 2)(page 2)

Operating Income & Net LossOperating Income & Net Loss 20072007 20062006

RevenuesRevenues $22,267$22,267 $60,622$60,622

ExpensesExpenses $59,909$59,909 63,95963,959

(Loss) from Operations(Loss) from Operations (37,642)(37,642) (3,337)(3,337)

AmortizationAmortization 41,28041,280 41,28041,280

Net Income (Loss)Net Income (Loss) $(78,922)$(78,922) $(44,617)$(44,617)

Deficit, openDeficit, open (108,721)(108,721) (64,104)(64,104)

Deficit, closeDeficit, close $(179,918)$(179,918) $(108,721)$(108,721)

Windshare 2008 AGM

Statement of Operations Statement of Operations Statement of Cash FlowsStatement of Cash Flows

Sources/Uses of CashSources/Uses of Cash SourcesSources

Preference and Membership shares

UsesUses Refunds to members Operating loss

Windshare 2008 AGM

Income TaxIncome Tax

Non-capital losses can be carried forward Non-capital losses can be carried forward and applied to future taxable incomeand applied to future taxable income

Both CCA and prior losses deductible Both CCA and prior losses deductible against future income afteragainst future income after

Windshare 2008 AGM

2007 Forecast2007 Forecast

2007 budget as yet not set. PPA rate to be 2007 budget as yet not set. PPA rate to be negotiated as to start date of RESOP negotiated as to start date of RESOP

Use conservative estimate for operating costsUse conservative estimate for operating costs Operating costs include maintenance contractOperating costs include maintenance contract Projections done for revenue & expenses for one Projections done for revenue & expenses for one

turbine and/or 2 additional turbines in budgetturbine and/or 2 additional turbines in budget 2007 budget shows operating surplus but net loss 2007 budget shows operating surplus but net loss

after amortization. after amortization. Continues to be not sustainable in the long term. Continues to be not sustainable in the long term.

Risk of more downtime and related repair costs Risk of more downtime and related repair costs remains high with no warranty.remains high with no warranty.

Not enough economies of scaleNot enough economies of scale

Windshare 2008 AGM

Acceptance of AuditedAcceptance of AuditedFinancial StatementsFinancial Statements

Motion:Motion: To accept the Audited Statements for TREC To accept the Audited Statements for TREC

WindShare Co-operative (No 1) Incorporated WindShare Co-operative (No 1) Incorporated for Fiscal Year ended September 30, 2007for Fiscal Year ended September 30, 2007

Windshare 2008 AGM

Appointment of AuditorsAppointment of Auditors

Board of Directors recommendation…Board of Directors recommendation…Motion:Motion: That Cowperthwaite Mehta Chartered That Cowperthwaite Mehta Chartered

Accountants be re-appointed auditors for Accountants be re-appointed auditors for TREC WindShare Co-operative (No 1) TREC WindShare Co-operative (No 1) Incorporated for Fiscal Year 2008Incorporated for Fiscal Year 2008

Windshare 2008 AGM

ExPlace Feasibility

OPTIONS

OPERATE LAGERWEY ALONE BUILD 2 NEW TURBINES DO BOTH

Windshare 2008 AGM

ExPlace Feasibility

AssumptionsAssumptions

Finance new Enercons with debentures (4%)Finance new Enercons with debentures (4%) Discount rate 4%Discount rate 4% NPV measure is return to existing NPV measure is return to existing

shareholdersshareholders

Windshare 2008 AGM

ExPlace FeasibilityExPlace Feasibility

Economic feasibilityEconomic feasibility

Option NPVOption NPV

Lagerwey alone out of cash in 11 Lagerwey alone out of cash in 11 yearsyears

Enercons alone 0Enercons alone 0

Both (680k) Both (680k)

Windshare 2008 AGM

ExPlace FeasibilityExPlace Feasibility

AnalysisAnalysis

Just Lagerwey is out of the questionJust Lagerwey is out of the question Just 2 new Enercons still leaves us with the Just 2 new Enercons still leaves us with the

Lagerwey to deal with. NPV of zero means all the Lagerwey to deal with. NPV of zero means all the return would go to the debenture holders.return would go to the debenture holders.

Have not costed removal of the Lagerwey although it Have not costed removal of the Lagerwey although it is being discussed with our JV partnersis being discussed with our JV partners

Negative NPV means original shareholder Negative NPV means original shareholder investment discounted by approximately 80%investment discounted by approximately 80%

Windshare 2008 AGM

EXPlace FeasibilityEXPlace Feasibility

ConclusionsConclusions Must do something to improve outlook for Must do something to improve outlook for

shareholdersshareholders 2 new Enercons about the only available 2 new Enercons about the only available

optionoption

Windshare 2008 AGM

ExPlace FeasibilityExPlace Feasibility

NEXT STEPSNEXT STEPS Continue the analysis of the 2 new EnerconsContinue the analysis of the 2 new Enercons If positive result can be developed then If positive result can be developed then

decision will come to membershipdecision will come to membership Apply to CP Fund for additional funding to Apply to CP Fund for additional funding to

continue analysis and processcontinue analysis and process

Windshare 2008 AGM

ExPlace FeasibilityExPlace Feasibility

ANTICIPATED SEQUENCE OF EVENTSANTICIPATED SEQUENCE OF EVENTS Receive approval from NavCanReceive approval from NavCan Do final feasibility analysis for membershipDo final feasibility analysis for membership Call member meeting to decideCall member meeting to decide If approved:If approved:

Finalize negotiations with THESI Finalize negotiations with ExPlace Commence environmental screening Apply for RESOP Commence marketing of debentures

Place order with EnerconPlace order with Enercon

Windshare 2008 AGM

ExPlace Feasibility

Dave Robertson

Motion: That the WindShare Board continue to pursue That the WindShare Board continue to pursue

building more turbines at Explace (and other building more turbines at Explace (and other developments) with a goal of coming back to developments) with a goal of coming back to the membership with a new offering statementthe membership with a new offering statement

Windshare 2008 AGM

Your 2008 Board:1. Gary Zavitz2. Ted Tracewicz 3. Dianne Sax4. Stewart Russell5. Jennifer Jeffery 6. Evan Ferrari7. John Binns

Treasurer – Dave Robertson

Windshare 2008 AGM

AgendaAgenda

10. QUESTIONS & ANSWERS 9:25-9:35

11.ADJOURNMENT 9:35

12.ANNOUNCEMENTS 9:35