A Low Cost, Renewable Energy Future NEM

WINDLAB LIMITED

2 APRIL 2019

ROGER PRICE

CHAIRMAN AND CEO

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Summary Information

This Presentation contains a summary of information about Windlab Limited ACN 104 461 958 (Windlab), its subsidiaries, and its activities which are current as at the date of this Presentation.

No representation or warranty, express or implied, is provided in relation to the accuracy, reliability or completeness of any statements, estimates or opinions, conclusions or other information provided in this Presentation. Statements in this Presentation are made only as of the date of this Presentation unless otherwise stated and the information in this Presentation remains subject to change without notice. Subject to its obligations under applicable law, Windlab is not responsible for updating, nor undertakes to update, this Presentation.

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The information contained in this Presentation has been prepared solely for informational purposes. This Presentation does not constitute an offer to sell, or the solicitation of an offer to buy, any securities in Windlab.

Forward looking statements

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Disclaimer

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About Windlab

Australian based, ASX listed, international renewable energy development company

WindScapeTM provides distinct, technology based competitive advantage; a strong scientific and analytical pedigree

Headquartered in Canberra, offices in North America and Southern Africa

Introduction

Completed 1093 MW

Total development

pipeline

50 projects>7,500 MW

Near term development

pipeline(permitted)

12 projects~1,500 MW

Capacity under management >A$1 Billion

Global Offices

Brisbane

Nairobi

About this Study

♦ Modelled a mostly renewable energy NEM using real demand and generation data; and

♦ Estimates the amount and cost of storage and dispatchable energy required

1. Modelling a Mostly Renewable NEM

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Data was, wherever possible, based on scaled-up operational generation data from AEMO

Supplemented with modelled data in geographic areas with sparse generation data

• Wind in QLD and Nth NSW

• Utility PV in all states except NSW

Created 30-minute energy traces of wind, rooftop and utility solar, covering 2017 & 2018 (2 year period).

Constructing the Renewable Datasets

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Demand: Actual 2017 + 2018

Hydro 7.8 GW, supplying 8.0% of demand. Same as historical.

Wind from ~7 GW to 37 GW, supplying 64% of demand

Utility PV from 2.7 GW to 15 GW, supplying 18% of demand

Rooftop PV from ~9.5 GW to 26 GW, supplying 18% of demand

Transmission Assumptions

Stage 1 interconnection recommendations from ISP (moderate increase in NSW-QLD and VIC-SA transfer limits)

RiverLink interconnector from SA to NSW

Modelled Scenario

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Modelled Scenario, By State

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Daily Storage, by state

25GW / 99GWh of daily storage, 85% round trip efficiency

Storage Options

• Existing pumped hydro storage: ~1.1 GW / 22 GWh

• 3 million residential batteries: ~18 GW / 36 GWh

• 10 million EVs ~ 500 GWh!! x10% = 50 GWh

2. Modelled Results

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NEM Daily Average Generation (1 year)

6.3% of total generation came from “Other” (14 GW, CF=10%)11% of generation curtailed (spilled)

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Model results: typical fortnight for NSW

NSW

Other could be:• Gas (transitioning to biogas/biofuels)• Demand management• Additional hydro• Long-term storage (Snowy 2.0, hydrogen etc)

Exports

Charging

Imports

curtailed

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Model results: Typical fortnight: VIC & QLD

VIC

QLD

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Wind + PV: NEM daily generation (2 years)Problematic winter deficits! Not possible to completely fill with existing hydro. Optimisation should act to reduce the size of these deficits.

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Model Results: Daily NSW Wind versus Deficit

NSW wind generation is somewhat negatively correlated to the generation deficit (R=-0.50)

Most days with a large NEM generation deficit (calm, cloudy winter days) tend to have reduced NSW wind generation.

During the 10% of days with largest NEM deficit, NSW wind tends to underperform

CF=17% on 10% of days with biggest deficit, compared to CF=35% over full 2 years -> relative performance of 47%

Shortfall of NEM wind+PV

Excess NEM wind+PV

R=-0.50

Good wind in NSW

Poor wind in NSW

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Preliminary Results: performance during the days with the largest generation deficit

Look at the 10% of days that have the largest generation deficit (ie. calm, cloudy winter days).

All states and technologies tend to underperform, but QLD wind has the highest normalised generation, at 86% of average QLD wind generation.

QLD solar has the best performance of the PV options (performs OK in winter)

QLD is an important state for renewables! An optimised mostly renewable NEM will be biased towards wind and solar generation in QLD with excess exporting to the other states.

100% implies average generation

NSW wind: relative performance = 47%

QLD Wind:86%

3. Conclusions

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Total Cost of Renewables

Base Cost Assumptions

Wind: $50/MWh (all states)

Solar: $50/MWh (QLD) - $60/MWh (TAS)

Firming Cost Assumptions

Storage: $85/MWh (Battery and PHS)

“Other” (Back-up generation): ~$168/MWh

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Conclusions

Model based primarily on NEM production wind and solar data.

Realistic interconnector limits (current + stage 1 recommendations from ISP+RiverLink)

Investigated a scenario with :

• 64% wind + 36% solar + 8% existing hydro

• 25 GW / 99 GWh of daily storage Model indicates:

• 94% of generation from wind+solar+hydro

• 6% supplementary generation required from “Other”

• ~11% spilled and ~3% lost in storage efficiency

All in Wholesale Cost < $70/MWh

A 94% renewable NEM can be achieved rapidly, reliably and cost effectively with realistic levels of storage and modest

investment in interconnectors.

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Key Observations

QLD generation is very important;

➢ QLD wind is not well correlated to other wind and solar and performs well on days when overall NEM wind and solar is well short of demand.

➢ QLD solar is useful as it remains relatively productive during winter.

TAS generation and hydro is very important;

➢ Large amount of hydro capacity is important in balancing wind and solar.

➢ TAS wind is helpful as it is also not well correlated to other wind and solar.

Improved interconnection between QLD-NSW (and within QLD) and TAS-VIC should be a priority to optimally achieve a mostly renewable NEM.

Snowy 2.0 has minimal effect on the need for “Other” generation. Reduces it from 6% to 5.1% of demand

Current “market signal” mechanisms will NOT put in generation in the RIGHT place