Consolidation in offshore windMax Ter Linden, RBS New Energy Technologies Group

EWEA Offshore, Stockholm, September 2009

2

RBS (ABN AMRO) is a leading investment bank in in wind power

2009USA

Dewind

USD 50mAdvisor on sale to Daewoo Shipping

2009China

China Wind Power

HKD 600mABB equity

raising

2009Denmark

Vestas

EUR 817mABB equity

raising

2008Finland

Masdar

EUR 120mAdvisor on WinWinD

investment

2007Spain

Ecotecnia

EUR 350mAdvisor on sale

to Alstom

2007Germany

Suzlon

EUR 1.3bAdvisor on Repower

acquisition

2004Denmark

Bonus

UndisclosedAdvisor on sale to

Siemens

2008Romania

CWP

600 MW wind projectAdvisor on sale to

CEZ

3

The economics of offshore wind vis-à-vis alternatives

Source: RBS analysis

LRMC (EUR/MWh 2009 inc. WACC) based on USD 80 oil price and EUR 30 carbon price

0

50

100

150

200

250

300

Coal Gas Onshorewind

Biomass Offshorewind

Nuclear Solar PV Wave Tidal

4

The financial crisis is affecting the renewables sector less than utilities

-11.2%

-33.0%

-56.5%

10

20

30

40

50

60

70

80

90

100

110

Sep-08

Oct-08

Nov-08

Dec-08

Jan-09

Feb-09

Mar-09

Apr-09

May-09

Jun-09

Jul-09

Aug-09

Sep-09

Wind Developers Wind Turbine Suppliers Utilities

Source: Factset

5

The value drivers for offshore wind are challenging today…

Capex

Tariff

Low carbon prices

Limited availabilityof funding

Grid uncertainty

• Cost of EUR 2500- 3500 per kW• Limited competition equipment and service suppliers • Electricity demand down 5-10% • Generally weak electricity prices today at EUR 40-50 per MWh• Good support schemes in Germany, UK and Belgium

• EUR 10-15 per ton today• Kyoto scheme ends in 2012• New scheme in Copenhagen uncertain

• Project finance market down 50%• Utilities reconsidering Capex plans• Performance bonds difficult to procure

• Governments and TSOs developing schemes• Schemes differ significantly and national focus• Uncertainty in UK and in Germany after 2015

6

…resulting in four key offshore wind M&A trends

Big is beautiful

Small is beautiful

Outsmart yoursupply chain

Technology itch

• Balance sheet is key for equipment suppliers

• Capital for manufacturing and working capital

• Procurement of performance bonds

• Funding difficult for large projects despite scale advantage

• Teaming up for projects, medium-sized utilities can also be friends

• Turbine makers less keen on backward integration

• If you can’t get a competitive EPC, do it yourself and provide a wrap

• Buy a boat if you don’t like the rental business

•Go PMG or direct drive

•Alternatively something different with standard components

7

Horizontal consolidation in offshore is accelerating…

Componentmanufacturing

Turbine supply

Installation services

Project development

Construction and operation

Ramp up in manufacturing and working capital

Investors primarily from LLCCs

Contractors stepping up wind effort as infra and oil & gas slow down

Developers team up with utilities

E.G. PNE - DONG, UK third round

For large projects utilities team up or seek financial co-investors

e.g. Statoil Hydro - Statkraft or Masdar into London Array (EON / Dong)

Turbine manufacturers acquiring specialized offshore players

e.g. GE-Scanwind, XEMC - Darwind

8

…while vertical integration is coming back

Componentmanufacturing

Turbine supply

Installation services

Project development

Construction and operation

Utilities integrating backwards into EPC business and installation, possibly turbines

e.g. Dong – A2Sea

Utilities becoming involved earlier in project development buying distressed projects and developing these further

Utilities less keen on buying developers

Component makers to integrate forward into turbine supply

e.g. Alstom, Areva, Dongfang

Companies looking for OEM positions

e.g. Ship maker DSME- Dewind

Developers integrating backward into turbine making

e.g. BARD

Thank you

Contact details:max.ter.linden@rbs.com+31 20 628 1249