BURBO BANK EXTENSION PROJECT BRIEFING MAY 2014

DO

NG

ENER

GY

3

About DONG EnergyDONG Energy is one of the leading energy groups in Northern Europe and has been a pioneer in the offshore wind industry for more than 20 years. We are the market leader in offshore wind, and we are involved in more than half of the current operating offshore wind farms worldwide. DONG Energy’s long term vision is to lead the transformation towards a lower carbon energy mix, while remaining focused on reducing the cost of energy.

Burbo Bank Extension Offshore Wind FarmThe proposed Burbo Bank Extension Offshore Wind Farm (’Burbo Bank Extension’) is located west of the operational Burbo Bank Offshore Wind Farm (’Burbo Bank’) in Liverpool Bay, around 7 km north of the North Wirral coast near the village of Meols, 8.5 km from Crosby beach, and 12.2 km from the Point of Ayr on the Welsh coast. The offshore site area is 40 km², and the wind farm could have a capacity of up to 259 MW which would be enough to power 170,000 UK homes.

The offshore turbines of Burbo Bank Extension will be in English waters while the onshore infrastructure will be located in Wales, so the offshore export cable will cross through England and Wales.

Since 2010, we have conducted two rounds of consultation with the communities close to the proposed offshore wind farm from

the North Wales Coast through to the West Lancashire coastline.

The offshore wind farm will be connected by an underground cable to the National Grid substation at Bodelwyddan, in St Asaph, Denbighshire. We have had and still have extensive dialogue with a number of landowners and residents along the proposed route.

* Indicative figure based on Renewable UK Statistics (2013) where a generic offshore wind farm with a capacity of 1GW would power: (1,000MW x 0.3196 average load factor x 8760 hours in a year / 4.226MWh annual domestic electricity consumption) = 662,493 homes.

Facts

Capacity up to 259 MW

Providing electricity for up to 170,000 UK homes *

Number of turbines up to 69

Turbine blade tip height up to 223m

Onshore cable route from Rhyl to Bodelwyddan,

Denbighshire

Potential jobs during construction 135 full-time jobs and 55

full-time jobs in in the local

supply chain

Potential jobs during operations 75 full-time jobs for the

expected 25-year lifetime of

the project

Potential local investment during £15 million

construction

2

Our investment in the UKWe are committed to investing in renewable energy generation infrastructure for the UK. Our total committed investment in renewable energy in the UK to date is £4 billion. In the UK, we have six operational offshore wind farms and two under construction. Moreover, we have an extensive programme of future offshore wind farms under development.

Find out more about us at www.dongenergy.co.uk.

DONG Energy has a growing portfolio of nationally significant projects in the North West of the UK. In total, DONG Energy has a committed investment of £4 billion in the UK, a significant proportion of which is in the North West region.

The UK Government aims to generate 15% of domestic energy from renewable sources by 2020. Offshore wind is a central part of this aim as well as the UK Government’s long-term aim of achieving an 80% reduction in CO2 emissions by 2050. These targets are driven by a need to secure energy supply and address climate change.

The proposed Burbo Bank Extension is classed as a nationally significant infrastructure project (NSIP), contributing to national renewable energy targets, and has the potential to generate enough electricity to annually meet the needs of 170,000 UK homes.

The need for renewable energy

4

Offshore and onshore elements of Burbo Bank ExtensionAs shown in this map, the offshore turbines of Burbo Bank Extension will be in English waters while the onshore infrastructure will be located in Wales. The offshore export cable will therefore cross the boundary of England and Wales.

The installation of underground cables is expected to begin in the first quarter of 2015. The works are set to include a temporary working width of approximately 25 meters along the cable trench, but may vary according to the nature and complexity of the works.

Onshore works will be indicatively undertaken for most of 2015 and early 2016, while offshore works are expected to commence in Q2 2016 and proceed until early 2017. First power is indicatively expected to be produced at the end of 2016 and a full commission potentially in mid-2017. A timetable for the detailed proposed construction works will be confirmed once the design detail is finalised and a construction contractor has been appointed.

5

At DONG Energy we have set a target to reduce the cost of electricity from offshore wind by 35-40% for projects approved in 2020 compared to 2012. With the proposed Burbo Bank Extension, we are taking steps to reach this target, including the potential for installing fewer and larger turbines.

Reducing the cost of electricity

DONG Energy are actively involved in accelerating the development of turbines. When turbines are designed for maximum

efficiency , this helps to bring down the cost of energy generated by offshore wind.

The blades of the 8MW turbine are 164 meters in diameter with a sweep area of 21,124 square meters. This means that the diameter of the turbine blades is almost one third bigger than the London Eye.

The 8MW turbineAs a result of a competitive commercial tender, Vestas Wind Systems has been chosen as the preferred supplier with a proposal to deliver an 8MW turbine for Burbo Bank Extension.

The turbines eventually chosen will remain within the design envelope parameters, including tip height of the vertical blade, rotor diameter and gross electrical output capacity, as assessed as part of the consent process.

For illustrative purposes only.

223m 8MW Wind Turbine 135m The London Eye 310m Shard, London

To learn more about how an offshore wind farm is installed, you can scan the QR code with your smartphone to watch a video of the installation of the world’s largest wind farm, London Array.

Watch video

26th September 2014: Development Consent Order Award

October 2014: Marine Licence Award

Q1 2015 – Q2 2016: Onshore Substation, Construction and Civil Works

Q1 2015 – Q2 2016: Export Cable Installed

Q2 2016 – Q3 2016: Turbine Foundations Installed

Q4 2016 – Q1 2017: Turbines Installed

Q3 2016 – Q4 2016: Offshore Substation Installed

Q4 2016: First Power Generated

Q1 2017 – Q2 2017: Commissioning

Anticipated MilestonesBurbo Bank Extension

Dates are indicative and subject to change.

XXXXX

N

E

S

WENGLAND

Point of Ayr

WALES

River Dee

Burbo Bank Extension

Export cable

Onshore substation

PRESTATYN

MOSTYN

FLINT

HOYLAKE

LEASOWE

RHYL

ST ASAPH

DENBIGHSHIRE

FLINTSHIRE

WIRRAL

RHUDDLAN

BODELWYDDAN

For illustrative purposes only.

SCALE 1:166,725

0 3 6Kilometers

0 1.5 3Nautical Miles

Chart Version : FinalChart Date : 10/03/2013Chart Printed : 10/03/2013

Chart produced by DONG Energy Wind Power (UK) Ltd. Copyright 2013c

6 7

Creating value in local areasAcross our wind farms, DONG Energy actively recruits and employs local people and provides significant investment to the areas in which we operate:

• 5,697 people were registered as having worked at our Walney Offshore Wind Farms during the two-year construction period.

• In the same period, around £1 million per month was contributed to the local economy around Barrow-in-Furness.

• Walney Offshore Wind Farms now support a total of 76 full-time jobs that are expected to be sustained for the estimated 25-year lifetime.

• At West of Duddon Sands Offshore Wind Farm, we have spent £4 million to build an operations base in Barrow-in-Furness.

• At Westermost Rough Offshore Wind Farm on the east coast, DONG Energy won a bid for expanding the harbour access with a new lock which now benefits many other business operations at the port.

An offshore wind farm the size of Burbo Bank Extension requires a sizeable investment and represents a significant opportunity to the economies of Liverpool, North Wales and the UK as whole.

Potential local value from Burbo Bank Extension

• 135 full-time jobs could be created in North-West England and North Wales during the expected two-year construction period of Burbo Bank Extension. This activity would directly generate around £15 million.

• 55 additional full-time positions could be created in the local supply chain during construction. This supply chain spend could create an additional contribution of £4 million in the regional economy during the construction phase.

• For the operations and maintenance of the wind farm, it is estimated that there would be a total of 75 full-time jobs and more than £4.2 million of value added to the UK economy each year.

• DONG Energy also sponsors local schemes across our sites. Examples of this support include apprenticeship schemes at the London Array and up-skilling the next generation of engineers at Menai College.

• In total, as a result of direct employment, engaging the local suppliers and induced spend from the being in the area, it is estimated that 775 jobs could potentially be created in the UK during the construction period, with 200 of these in North Wales and North West England. For the 25 year operation lifetime of the project 155 jobs could be created in the UK, with 55 of these in North Wales and North West England.

Engaging with the local supply chain

“We want to meet with suppliers in the local area that may be able to assist us with the proposed Burbo Bank Extension. We are keen to get work underway as soon as we have all of the consents and permissions that we need, and these events will help to enhance and expand our knowledge of the local supply base, as well as share information on how to become a supplier to DONG Energy for this project and any future works in the local area.”

Ferdinando GiammicheleProject Development ManagerDONG Energy

135 full-time jobs during

construction.

55 additional full-time

positions in the local supply

chain.

75 operations and

maintenance full-time jobs.

“All of our staff are local to the North West area, most being from Liverpool and the Wirral. Our staff include Engineers, a Warehouse Coordinator, a Health and Safety Manager and an Assistant Operations Manager. There is a plethora of training opportunities within DONG Energy. For example, Wind Turbine Technicians are given offshore survival training, first aid and working at height training to name but a few.”

Lee RollasonOperations Manager Burbo Bank DONG Energy

DONG Energy intend to offer communities located near the potential proposed Project a Community Benefit Fund (CBF). The CBF will only be implemented if DONG Energy makes a positive financial investment decision to construct the Project and would come into effect after construction starts, which could be in Spring 2015.

Community benefit funding

DONG Energy has appointed GrantScape to carry out local consultation to seek views from all stakeholders on how the community benefit fund should be set up.

This consultation will commence in March 2014 with an online consultation survey. If and when it is decided to build the Burbo Bank Extension, GrantScape will also hold

a series of public exhibitions to allow all stakeholders to find out more about the fund and to share their views on where and who should benefit.

To find out more, please email burbobankextensionCBF@grantscape.org.uk or call GrantScape on 01908 247634.

At DONG Energy, health and safety needs to be a truly integrated part of the everyday work of our employees and contractors.

An outstanding health and safety record

Health and safety is a key factor when we evaluate and choose suppliers. Also, we expect the Burbo Bank Extension to create new health and safety jobs.

In May 2013, the Burbo Bank Operation & Maintenance Team won DONG Energy’s Health and Safety Executive Award for 2012 for a highly positive safety culture, reflected in their continuous hard work to create a safe site.

“At Burbo Bank we have a really good safety record, based on consistent hard work by everyone from our management, to our cleaners and technicians. With respect to our suppliers, safety is top of our list. We choose local suppliers that we know will work safely. With the Burbo Bank Extension, we’re going to have more suppliers and more people working on our site, but the way we treat our suppliers will stay the same.”

John VernonHealth and Safety ManagerDONG Energy

At DONG Energy, we are committed to engaging with local suppliers and utilising local talent wherever possible. For the proposed Burbo Bank Extension, local suppliers could supply product categories such as vessels, geosciences, construction site logistics and onshore substation works. Most local suppliers are, however, generally subcontractors in tiers two to five. For example, a tier one supplier of wind turbines, foundations, cables or advisory services could require local crew, specialists, catering, hotel accommodation, fuel, small components or hire equipment.

As part of DONG Energy’s ongoing initiatives to engage with and develop the local supply chain, we will hold “meet the buyer” events in Denbighshire and New Brighton in May this year. See more information on the back page.

Procurement strategyWe have a procurement strategy that focuses on ensuring that local suppliers get the opportunity to participate in tenders for services and components and that services/components are acquired locally where it makes sense from an economic and quality perspective.

For instance, the development phase of the Burbo Bank Extension has cost about £7M, of which more than 95% has been spent in the UK to date with UK-based staff, contractors and services.

Our Operations team for the existing Burbo Bank Offshore Wind Farm buy their equipment and supplies from local or UK suppliers, except when the required equipment is not available in the UK, is not competitively priced, or where we have pre-existing international supply agreements.

We continue to examine opportunities for further increasing our UK content, and we are a signatory to the government’s vision that over 50% of the content of all offshore wind farms will come from the UK. Proposals to open turbine & other offshore wind component factories in the UK will assist in meeting this target and we support these initiatives.

DONG Energy Burbo Bank Extension (UK) Ltd.33 Grosvenor PlaceLondon SW1X 7HYTel: +44 (0) 207 811 5200

D

ON

G EN

ERG

Y

“Meet the buyer” events

Contact usIf you have questions or would like an electronic copy of the above documents, please email:burbobankextension@dongenergy.co.uk

To find out more, please visit the project website:www.burbobankextension.com

Wednesday 7th May 12.00 - 16.00The Beaches Hotel, Beach Road East, Prestatyn, Denbighshire, LL19 7LG

Thursday 8th May 12.00 - 16.00 Floral Pavillion, Marine Promenade, New Brighton, Wirral, CH45 2JS

Further informationBurbo Bank Extension Offshore Wind Farm Environmental Statement, Volume 3 - Chapter 33: Socio-Economic Impact Assessment. March 2013.

Burbo Bank Extension Offshore Wind Farm Environmental Statement, Volume 1 - Chapter 6: Project Description. March 2013.

DONG Energy is keen to engage with the local supply chain. We have arranged two events to meet companies from the area to discuss how they may be able to supply goods and services, either as subcontractors or direct suppliers.

To find out more about the opportunities available, please come along to one of the following events:

© DONG Energy Power (UK) Ltd. 2014. All rights reserved. No parts of this publication may be reproduced by any means without prior written permission from DONG Energy Power (UK) Ltd.

Every effort has been made to ensure the accuracy of the material published, however DONG Energy Power (UK) Ltd. is not liable for any inaccuracies.