FACTS & FIGURES 2010

FACTS & FIGURES 2010(Updated August 2010)

RWE Facts & Figures | Updated August 2010 2

* Footnotes are to be inserted manually (using “copy” and “paste“).

RWE Facts&Figures 2010 contains certain forward-looking statements as defined by US federal securities laws. This predominantly relates to the following statements:

Projections of revenue, income, earnings per share, capital expenditure, dividends, the capital structure and other financials;Statements of plans or objectives for future operations or concerning the company’s future competitive position;Expectations of future economic performance; andStatements of assumptions underlying several of the foregoing types of statements, all of which are forward-looking statements.

Also words such as “anticipate”, “believe”, “estimate”, “intend”, “may”, “will”, “expect”, “plan”, “project”, “should” and similar expressions are intended to identify forward-looking statements. The forward-looking statements reflect the judgement of RWE’s management based on factors currently known to it. No assurances can be given that these forward-looking statements will prove accurate and correct, or that anticipated, projected future results will be achieved. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. Such risks and uncertainties include, but are not limited to, changes in the general economic and social environment, business, political and legal conditions, fluctuating currency exchange rates and interest rates, price and sales risks associated with a market environment in the throes of deregulation and subject to intense competition, changes in the price and availability of raw materials, risks associated with energy trading (e.g. risks of loss in the case of unexpected, extreme market price fluctuations and credit risks resulting in the event that trading partners do not meet their contractual obligations), actions by competitors, application of new or changed accounting standards or other government agency regulations, changes in, or the failure to comply with, laws or regulations, particularly those affecting the environment and water quality (e.g. introduction of a price regulation system for the use of power grids, creating a regulation agency for electricity and gas or the introduction of trading in greenhouse gas emissions), changing governmental policies and regulatory actions with respect to the acquisition, disposal, depreciation and amortisation of assets and facilities, operation and construction of plant facilities, production disruption or interruption due to accidents or other unforeseen events, delays in the construction of facilities, the inability to obtain, or to obtain on acceptable terms, necessary regulatory approvals regarding future transactions, the inability to successfully integrate new companies within the RWE Group to realise synergies from such integration and the potential liability for remedial actions under existing or future environmental regulations and the potential liability resulting from pending or future litigation. Any forward-looking statement is valid only as of the date on which it is made. RWE neither intends to, nor assumes any, obligation to update these forward-looking statements. For additional information regarding risks, investors are urged to consult RWE’s latest annual report, other reports recently filed with the Frankfurt Stock Exchange or the SWX Swiss Exchange and the material furnished to the US Securities and Exchange Commission by RWE.

Forward-Looking Statement


133 RWEElectricity

GenerationFuelsTradingNetworkSupply

GasUpstreamLNGTradingTransportDownstream

AccountingNuclear Provisions

Investor Relations

137137166169171173179179189192195198205205207

74

55

4

7777939799

103115115122

575864666971

71111303236364051

Market DataElectricity

GenerationFuelsTradingGrid Supply

GasLNGDownstream

Political EnvironmentCombined Heat and Power (CHP) ActRenewable Energy ActEmissions TradingNational Allocation Plan II (NAP)Large Combustion Plant Directive (LCPD)Network

At a GlanceStructureStrategy

CornerstonesAcquisitions and DivestmentsSustainability

Financial InformationRWE ShareFixed Income Financing

Risk Management

At a

Gla

nce

Polit

ical

Envi

ronm

ent

Mar

ket D

ata

RW

E

Table of Contents


RWEMarket Data

At a Glance

Political EnvironmentAt a Glance


7 Structure11 Strategy36 Financial Information51 Risk Management


Our Corporate Responsibility Strategy: Ten Fields of Action (II)33Our Corporate Responsibility Strategy: Ten Fields of Action (I)32

In 2009, RWE Spent €2,229 Million on Environmental Protection 35The Technology of the Future: RWE to Gain Leadership in Europe in Virtually CO2-free Power Plant Technology 34

Sustainability [32 – 35]

RWE's Mid-term Financial Targets through to 2012 29

Status of RWE's New Build Projects (as of May 2010)26RWE Acquisition Criteria27Efficiency Enhancement Programme is on Track to Deliver €1.2 Billion by 201228

RWE Today: One of the Leading Integrated European Utilities8

Major Divestments since FY 2008 31Major Acquisitions since FY 2008 30

Cornerstones [11 – 29]

Structure [7 – 10]At a Glance [7– 54]

Acquisitions and Divestments [30 – 31]

Investment Programme of €28 Billion 2010 – 201325Stable Portfolio: 28% of Operating Result Derived from Regulated Businesses (2009)24Managing CO2: We Complement Physical Measures by Comprehensive Financial Optimisation23Our Strategy to Reduce the Impact of CO2 on Our P&L in 201322Prepared for Post-Kyoto: Our Generation Portfolio is Set to Be 75% "Zero or Low Carbon" by 202521Nabucco Will Link Caspian & Middle East's Supply to Cover Europe's Increasing Demand20Excelerate Energy: Innovative LNG Solutions19Excelerate Technology Increases Flexibility in Gas Supply18Fossil Fired Generation Strategy: Growth, Higher Flexibility, Less CO2 Emissions17Our Renewable Energy Strategy: Growing Generation Capacity and Profit − in Existing and New Markets16Nuclear Strategy: Preservation of Nuclear Expertise, Growth in New and Existing Markets, Zero CO215RWE's Simple Strategy – Where to and Why?14Our Focus Remains Europe – but with a Far Wider Scope13More Growth, Less CO2 – Our Strategic Roadmap for 2012/201312RWE's Strategy – Stability and Growth: The Right Mix for Adding Value11

Strategy [11 – 35]RWE's Customers (2009)10RWE Group Structure: A Mirror of the Value Chain9

RWE Group Structure 2010: More Market-driven, Leaner and Faster7

Table of Contents


Asset Management: Investment Strategy (excl. Plan Assets) 41

Credit Risk Management at the RWE Group 54

Fixed Income Financing [40 − 50]

Financial Information [36 − 50]RWE Share [36 − 39]

Risk Management [51 – 54]

At a Glance [7– 54]

RWE Supply & Trading Commodity Risk Limit System 53RWE's Commodity Risk Management Infrastructure 52Organisation of Risk Management in the RWE Group 51

RWE Securities 50RWE Bond Programme49RWE AG: Financial Risks and Managing Interest Rate Risk – Asset/Liability Management 48Credit Rating 2010 – RWE AG 47Major Goal Remains to Secure Sound Credit Standing as Expressed by A-flat/A2 Rating46Gross Financial Debt – Currency and Interest Exposure 45RWE AG: Strong Sources of Financing 44RWE's Corporate Treasury – Basis for Groupwide Financial Risk Management 43Asset Management: Investment Strategy (Domestic Plan Assets; Smaller Plans Deviate Slightly) 42

Management of Financial Assets: Centralised Structure 40

RWE's Dividend Policy (II) 39RWE's Dividend Policy (I) 38RWE Share Profile 37RWE AG Shareholder Structure 36

Table of Contents


RWE Group Structure 2010: More Market-driven, Leaner and Faster

RWE AG(Group Centre)

> Amprion (formerly RWE Transportnetz Strom, Germany)> Thyssengas (formerly RWE Transportnetz Gas, Germany)> RWE Technology > Internal Services

Region Function

StructureMarket DataPolitical EnvironmentAt a Glance RWE

Germany

RWE Vertriebincl. RWE Aqua, eprimo,RWE EffizienzRWE Rheinland Westfalen NetzenviaM/MITGASKEVAG LEWSüwagVSEKELAG

Essent RWE npower RWE HungáriaRWE Polska(Poland)VSE (Slovakia)RWE Transgas(Czech Republic)NET4GAS (Czech Republic)RWE Holding (Turkey)

RWE Innogy RWE Dea RWE Supply & Trading

RWE Power

Central Eastern and South

Eastern Europe

UnitedKingdom

Netherlands/Belgium

Trading/Gas Midstream

UpstreamGas & OilRenewablesPower

GenerationSales and

Distribution Networks


We have leading positions in two of Europe’s largest markets as well as in fast growing CEE markets and own a large upstream position in both Europe and North Africa.

RWE Core Markets

United Kingdom

Netherlands

Luxembourg

Austria

Hungary

Poland

Slovakia

CzechRepublic

Germany

RWE Today: One of the Leading Integrated European Utilities

Electricity Gas Water

*) Market positions of the RWE Group in terms of sales.


Leading Positions in Core Markets

GasElectricityMarket*)

Product

Germany No. 2 No. 3

UK No. 3 No. 4

> No. 2 in Hungary

> No. 3 in Slovakia

> Presence in the Czech Republic

> No. 6 in Poland

> Leading position in Hungary

> No. 2 in Slovakia

> No. 1 in the Czech Republic

Eastern Europe

Total Europe No. 3 No. 6

Netherlands No. 2 No. 1


1) Not included: Amprion, Thyssengas, RWE Effizienz, RWE Technology and internal services.2) Including lignite production.

Conventionalpower generation

Renewableenergy

Energy trading/ gas midstream

Electricity and gas grids

Electricity and gas supply

RWE Dea

RWE Power2)

RWE npower

RWE Supply & Trading

RWE Innogy

Essent

RWE Rheinland Westfalen Netz

German regional companies

Central Eastern and South Eastern European regional companies

RWE Vertrieb

RWE npower

Essent

Power generation

Gas and oilproduction

RWE Group Structure: A Mirror of the Value Chain1)


> Integrated business model: strong presence in all parts of the energy value chain> Stability and growth: well balanced portfolio of leading market positions in mature and growing markets in Europe



RWE's Customers (2009)

15

8

16

0 5 10 15 20

Water

Gas

Electricity

Millions


*)

*) Figure relates to drinking water and sewage water. Population served in Continental Europe.


RWE's Strategy – Stability and Growth: The Right Mix for Adding Value

> Regional focus> Cost leadership> Focus on high-value customers and regulated business> Vertical integration> Synergies

Electricity

Gas

Focus on European key regions

Focus primarily on energy

Germany

UK

Netherlands/Belgium

Central Eastern and South Eastern Europe incl. Turkey

> Focus on high-quality markets> Strong presence with critical mass > Regional synergies> No "problem zones"

Strategy – CornerstonesMarket DataPolitical EnvironmentAt a Glance RWE


What we aim to do Target

Safeguard and increase existing margins in RWE key markets, i.e. Germany and UK

Increase level of regional diversification

Boost proportion of renewables in our generation portfolio while creating value

Reduce carbon exposure

Strengthen gas midstream activities

Grow equity gas business organically

GER: safeguard/increase margins on current volumesUK: safeguard/increase volumes and profitability

Grow share of non-German operating result from 34% (2009) to 40 - 50% by 2012

More than triple the installed base to 4,500 MW by 2012; operating result of at least €0.5 billion p.a. by 2013

Reduction of 20% (compared to 2008 emissions) by 2012

Profitably increase contracted European gas supply purchase volume from 40 to 60 bcm p.a. by 2012

Operating result of at least €0.9 billion p.a. by 2013

More Growth, Less CO2 – Our Strategic Roadmap for 2012/2013 (As of February 2010. Mid-term targets are under review; announced in August 2010)



x.y

RWE core markets with established market positions

Additional markets especially for renewables business

Growth markets under observation

Expected electricity/gas consumptiongrowth in % p.a. (2010 − 2020)

0.25/1.25

0.25/2.25

3.75/4.50


3.00/2.00

Our Focus Remains Europe – but with a Far Wider Scope


RWE's Simple Strategy – Where to and Why?

> Strengthening RWE‘s business along the entire value chain (from upstream to the end customer)

> Reducing risks from different markets and regulators by geographic diversification> Reducing selected commodity positions (CO2)> Stable regulated business

> Modernisation of power plant portfolio> Strong expansion of renewable energies

… moresustainable

> High share of investments outside of Germany> Growth in regions new to RWE

… moreinternational

…and in the end more valuable despite all challenges!

… more robust



Nuclear Strategy: Preservation of Nuclear Expertise,Growth in New and Existing Markets, Zero CO2

NDA sites

Cernavoda

Investment criteria

> Security: Focus on countries with an existing nuclear framework (legal, infrastructure, waste)> Nuclear framework: Highest standards (plant security, technology, quality), focus on new builds> Strategic fit: Attractive market, compatible with RWE‘s portfolio and strategy> Financial criteria: the same standard criteria as for other generation new build projects

Romania

> Construction of two new CANDU units (2 x 720 MW) in Cernavoda

> Commissioning planned for 2015/16

> RWE with 9% stake in consortium of GDF Suez, Iberdrola, CEZ, Enel, Accelor-Mittal and the Romanian utility Nuclearelectrica

UK

> New nuclear pro-gramme since 2006

> Horizon Nuclear Power JV with E.ON to build up to 6 GW

NPP units being planned/considered

National framework for new builds until 2015

National framework for new builds between 2016 and 2025

RWE activities

National frameworks



Our Renewable Energy Strategy: Growing Generation Capacity and Profit − in Existing and New Markets(Accounting view + PPA*), as of December 31, 2009)(As of February 2010. Mid-term targets are under review; announced in August 2010)

0

2

4

6

8

10

12

14

16

18

20

22

RWE Innogy: Generation assets and project pipeline

Inoperation

Underconstruction

Pipelinestatus 1

Pipelinestatus 2

Totalpipeline

Pipelinestatus 3

2.2 0.41.2

8.1

7.3 16.7

GW

RWE Innogy: Organic capacity ramp-up translating into profits

> We maintain our capacity target of 4.5 GW in operation or under construction by 2012, which translates into a minimum generation of 15 TWh/a from 2013 onwards

> On this basis, the company aims to have hit the €500 million operating result mark by 2013

> Organic growth (incl. development of acquired pipeline) and select strategic acquisitions

> Value creation remains priority over additional MW


Pipeline status 1 – Permitted projects: all permits (including grid) in place, but not yet under constructionPipeline status 2 – Unconsented projects: RWE Innogy has rights to the project, e.g. land agreementsPipeline status 3 – Prospects: identified sites with a known MW capacity, initial discussion on agreements

*) PPA = Power Purchase Agreement.

RWE Innogy: Breakdown of assets in operation

2.2 GW

Biomass5%

Germany41%

Other 4%

Onshorewind 64%

Offshorewind 7%

Hydro24%

UK 23%

Spain 19%

Netherlands10%

France3%

2.2 GW

Biomass

Hydro

Offshore windOnshore wind


Fossil Fired Generation Strategy: Growth, Higher Flexibility, Less CO2 Emissions

Comparison of ramp capacities between new CCGT unit and new coal vs. old coal unit

0

200

400

600

800

1.000

0 5 10 15 20 25 30

MW

min

Max cap. ~ 875 MWMin cap. ~ 260 MW*)

Max gradient +/- 38 MW/min

New CCGT

Max cap. ~ 600 MWMin cap. ~ 420 MWMax gradient +/- 8 MW/min

*) One turbine gets turned off.

Old coal

Max cap. ~ 800 MWMin cap. ~ 320 MWMax gradient +/- 26 MW/min

New coal

,

New gas-fired 875 MW plant: > 58% efficiency for peak time, or all load regimes

New hard coal-fired 1,600 MW plant in Hamm –two flexible 800 MW units for mid-merit regime

Small and flexible units can be dispatched more quickly to capture extra margin potential along the merit order



> Gulf Gateway (USA)> Northeast Gateway (USA)

Excelerate Deepwater Ports Excelerate GasPorts Ship-to-ship transfer (STS)

> Teesside GasPort (UK)> Third party GasPorts in Bahia Blanca

(Argentina) and Mina Al-Ahmadi(Kuwait)

> German GasPort in Wilhelmshaven(development underway)

> Transfer between conventional and Excelerate ships is possible

> Proves for additional flexibility and 3rd party cargos/transport

> Main assets: two US offshore Deepwater Ports (capacity of approx. 10 bcm/a); GasPort in the UK (capacity of approx. 4 bcm/a), a fleet of currently nine LNG vessels with transport capacity of approx. 4.8 bcm/a, third-party GasPorts

> Other import projects under development utilising these technologies> Discharge of LNG at conventional import terminals also possible

Excelerate Technology Increases Flexibility in Gas Supply



Under Development

Gulf Gateway

WilhelmshavenGasPort

Northeast Gateway

Teesside GasPort

Bahia Blanca GasPort

Mina al-AhmadiGasPort

Excelerate Energy: Innovative LNG Solutions


Operational

> Main Excelerate operations include:– 2 US offshore Deepwater Ports – 3 GasPorts: Argentina,

Kuwait and UK– 9 LNG vessels in operation

(1 traditional carrier and 8 Energy Bridge regasification vessels)

> Excelerate Energy has a proven technology, ideally tailored to the needs of flexible and peak-load demand

> Excelerate offers cost-effective solutions: a Gateway incurs typically one tenth the costs of a conventional LNG receiving terminal

> Excelerate vessels can also be used as “floating storage”

Focusing on delivering LNG to downstream markets, Excelerate acquires LNG shipping capacity through flexible time charters and ownership positions to import it and develop unique market access points around the world


Nabucco Will Link Caspian & Middle East's Supply to Cover Europe's Increasing Demand

x.x

Nabucco pipeline

RWE pipelines

RWE customer markets

Number of RWE customers

Potential gas sources for Nabucco

UK 2.6 m

Germany1.1 m

Czech Rep.2.3 m

Hungary*2.1 m

Netherlands1.9 m

> The Nabucco pipeline project links RWE's downstream positions with the Caspian region and other potential gas resources

> 3,300 km pipeline link to large gas resources in the Caspian and Middle East

> Key next target: “open season” process to market transport capacity to shareholders and third-party shippers expected to start during the course of 2010

> Final investment decision expected at the end of 2010 with gas scheduled to start flowing by 2014

> Final construction phase completed by 2019/20 with a max. capacity of 31 bcm/a

> Partners: BOTAS (Turkey), Bulgarian Energy Holding (Bulgaria), Transgaz (Romania), OMV (Austria), MOL (Hungary) and RWE, each holding 16.7%

> Investment: up to approx. € 8 billion> Intensive talks with potential supply countries like

Azerbaijan, Turkmenistan, and Northern Iraq> RWE received invitation to concrete negotiations from

Azerbaijan

Egypt

Iraq

Iran

Kazakhstan

Turkmenistan

Saudi Arabia


Azer-baijan

Russia

*) Including minority holdings ≥ 20%.


Prepared for Post-Kyoto: Our Generation Portfolio is Set to Be 75% "Zero or Low Carbon" by 2025

Output 2025

RW

E ge

nera

tion

mix

(c

apac

ity in

%)

Capacity 2009 Capacity 2025: ~65 GW

RW

E ge

nera

tion

mix

(o

utpu

t in

%)

Output 2009

Lignite & hard coal

Renewables

Gas

Pumped storage, other

Nuclear


75%

Lignite & hard coal

Renewables

Gas


Nuclear

Lignite & hard coal

Renewables

Gas


Nuclear

Lignite & hard coal

Renewables

Gas


Nuclear


2008-2012 2013-2020 2013

Our Strategy to Reduce the Impact of CO2 on Our P&L in 2013

Certificates to be purchased*) Operating result 2009–2013 Offsetting factors

> Expected higher level of powerand gas wholesale prices

> New build to be commissioned> Substantial increase in profit from

renewables and upstream gas & oil> Stable contribution from retail and

network business> Increased efficiency enhancement

programme

2009 2010 2011 2012 2013

60 – 70

160 – 170 +100

Organic growth/High earnings visibility

Small M&As

Essent

CO2 reduction, CDM/JI

Million mt p.a.

2013 above 2009

*) Excluding Essent; Essent produces CO2 emissions of approx. 8 to 10 million metric tons p.a.


(As of February 2010. Mid-term targets are under review; announced in August 2010)


Managing CO2: We Complement Physical Measures by Comprehensive Financial Optimisation

> Our large low carbon new-build programme as well as our investments in renewables will lead to substantial improvement of our CO2 intensity by 2013

> For phase 3 (2013 – 2020) we aim to reach a “market average” position in terms of our exposure to changes in CO2 prices

0.80

0.45

0.67

Today 2013 2020

Specific CO2 emissions exposure (mt/MWh)

New builds and

shutdowns2)

Renewables CDM/JI Portfoliooptimisation New

builds RenewablesShut-

downs/lower

load factor

Portfoliooptimisation

Market average

1)

1) Assumes standardised load factors for RWE portfolio including Essent based on commodity price levels and power demand in 2007 – 2009.2) Conventional new builds currently under construction and agreed plant shutdown; assumes nuclear lifetime extension.



Stable Portfolio: 28% of Operating Result Derived from Regulated Businesses (2009)External revenue (€47,742 million) Operating result (€7,090 million)

Unregulated business 72%

Regulated business 28%

Regulated business particularly includes:> German electricity and gas networks> Czech gas networks and storage> Electricity supply in Hungary> Continental European water business> Renewables






EBITDA (€9,165 million)


Investment Programme of €28 billion 2010 – 2013

Committed capex

GermanForeign

German vs foreign capex

2010 2011 2012 2013

95%80%

55% 50%

2010 – 201360% of capex will be spent outside of Germany.

Up to half of annual capex is still flexible in later years.

Strategy – CornerstonesMarket DataPolitical Framework ConditionsAt a Glance RWE

€2,100 m p.a.~50% Generation~50% Sales & Distribution

€500 m p.a.

€1,000 m p.a.

€900 m p.a.

€1,400 m p.a.

€1,000 m p.a.

€100 m p.a.

Germany

UK

Netherlands/Belgium

CEE

Renewables

Upstream

Other

€7.0 bn p.a.+/- 10%

2010 – 2013

As of February 2010.



0.5Denizli(CCGT, 776 MW)

2.6Eemshaven(Hard coal/biomass, 1,560 MW)

2.2Hamm (Hard coal, 1,528 MW)

1.2Pembroke (CCGT, 2,188 MW)

1.1Claus C (CCGT, 1,304 MW)

0.4Moerdijk 2 (CCGT, 426 MW)

2.5BoA Neurath(Lignite, 2,100 MW)

0.8Staythorpe(CCGT, 1,650 MW)

0.5Lingen(CCGT, 887 MW)

2014201320122011201020092008200720062005Capex (€ bn)

Status of RWE's New Build Projects (as of May 2010)

F*)

B

Units 1 – 5

Units 1 – 4

Unit G

Unit A

Unit D E

*) Data on start of full commercial operation is preliminary and cannot be finally determined yet due to an accident in 2007.



RWE Acquisition Criteria(As of February 2010. Mid-term targets are under review; announced in August 2010)

> IRR > hurdle rate after tax; hurdle rate = project specific WACC(5.5 - 6.5%, upstream 8.5%) plus value contribution and risk premium dependent on risk of the business and region

> ROCE has to match WACC in the 3rd year of full inclusion of acquired assets (including goodwill)> New leverage factor target: from 2010 onwards, we want to orientate ourselves towards an upper limit of 3.0 net debt/EBITDA.

Our major goal remains to secure an A flat/A2 rating.

Financial criteria

> Business complementarity– Products– Regions– Synergies

> Provide growth potential> Improvement of CO2 profile

Strategic criteria



> Fully accretive to operating result (i.e. post-cost inflation and one-off cost of programme)> Underpinned by a significant portfolio of projects across the Group, e.g.:

– Cost savings by RWE’s German sales & distribution businesses(e.g. merging of callcentres, standardisation of back-office processes, IT pool purchasing and grid maintenance)

– Key performance-improvement projects at RWE Power and RWE npower to increase thermal efficiency, availability and capacity of existing power stations as well as cost-cutting measures

€ million

Cumulative operating result contribution of the programme compared to 2006

0

300

600

900

1200

2007 2008 2009 2010 2011 2012

€1,200 millionannual contributionin total as of 2012vs. 2006

1,200

900700

450

200100

Efficiency Enhancement Programme is on Track to Deliver €1.2 Billion by 2012



RWE's Mid-term Financial Targets through to 2012

Targets

Recurrent net income Dividend Efficiency

Approx. 5% CAGR*) through to 2012 based on an average realised price for German electricity forwards of at least €60/MWh, US$80 per barrel of Brent crudeand carbon costs of€20/mt CO2

Payout ratio of 50% –60% of recurrent net income with the goal to at least match the previous year’s dividend for each fiscal year from 2010 to 2013

Compliant with at least an A flat/A2 rating category

Approx. 5% CAGR*)

through to 2012 based on an average realised price for German electricity forwards of at least €60/MWh, US$80 per barrel of Brent crude and carbon costs of €20/mt CO2

€1.2 billion improvement in annual operating result by the end of 2012 vs. 2006

Operating result

Capital structureCapital structure

*) Based on 2008 (excluding Essent).As of February 2010.




Major Acquisitions since FY 2008

702009Breagh gas field and surrounding exploration licenses, UK

502008Excelerate Energy, USA

1002009Favorit GmbH, Germany49 to 1002009Luxempart Energie S.A. (holds stake in SOTEG S.A.), Luxembourg

502008Greater Gabbard Offshore Windparks Ltd., UK1002008Powerhouse Holding B.V., Netherlands

1002009Essent N.V., Netherlands

502008Fri-El S.p.A., Italy1002008Urvasco Energía S.A., Spain

Percentage of participation

Year of acquisition

Company

Strategy – Acquisitions and DivestmentsMarket DataPolitical EnvironmentAt a Glance RWE


Major Divestments since FY 2008

51% less one share2009swb, Germany*)

from 100 to 60.5%from 60.5 to 0 %

20082009

American Water, USA502008Tarragona Power, Spain

8.232008Rhenag, Germany

Percentage stakeYear of divestmentCompany

Strategy – Acquisitions and DivestmentsMarket DataPolitical EnvironmentAt a Glance RWE

*) Divestment by Essent in order to obtain approval for acquisition of Essent N.V. by RWE.


Our Corporate Responsibility Strategy: Ten Fields of Action (I)

Best reputation of all comparable companies in the industry

Reputation Index5)…to strengthening our regional reputation by making efficient use of resources.

Community engagement

Customer Loyalty Index of > 771)Customer Loyalty Index4)

(CLI)…to having satisfied and hence loyal customers.

Pricing

- Compliance with the (n-1) criterion, 1, 3)

- SAIDI < 25 minutes1)

- (n-1) criterion- System Availability

Interruption Duration Indicator (SAIDI) in minutes per year and customer

…to ensuring system security across our transmission networks at all times.…to supplying our customers with the energy they need at all times.

Security of supply

- RWE real estate: 5%1)

- RWE vehicle fleet: 20%1)

- RWE power plants: 11%2)

- RWE customer projects: 8%2)

Increase in energy efficiency in %

…to increasing both our own energy efficiency and that of our customers.

Energy efficiency

0.45 mt CO2/MWh by 2020Average CO2 emissions in metric tons per MWh of electricity generated (mt CO2/MWh)

…to significantly reducing our power plant portfolio‘s CO2 intensity. Our goal is to take physical and financial measures to lower our CO2 exposure to the level of an average competitor in our markets no later than 2020.

Climate protection

TargetKPIsWe are committed…Field of action

1) Applies only to companies based in Germany. 2) Applies only to companies based in Germany and the UK. RWE organises contests for customers (residential, commercial and industrial), municipalities and the public and provides them with advice and assistance with a view to improving energy efficiency. Some of these activities are evaluated to determine how beneficial they are in terms of saving money and the climate. Energy savings are calculated on the basis of a before-and-after comparison. 3) Meeting the n-1 criterion ensures that the fault-induced outage of a major network component (such as a line, transformer or generator) does not cause the entire network to fail. 4) The Customer Loyalty Index is based on an annual customer survey covering all Geman sales companies. Standardised questions and answers on issues such as value for money, customer satisfaction and customer loyalty are used as a basis for determining approval ratings on a scale of 1 to 100.5) The Reputation Index builds on an annual poll of opinion leaders and the public. Journalists, politicians, industry, NGO, trade association and research institute representatives as well asa representative cross-section of the population are canvassed using standardised questions and answers on their perception of RWE for this purpose.

Our objectives are based on both what society expects of us as an responsible energy supplier and on those issues which in our view are crucial to our sustainability as a business.

Strategy – SustainabilityMarket DataPolitical EnvironmentAt a Glance RWE


Our Corporate Responsibility Strategy: Ten Fields of Action (II)

Average position among comparable companies

Demographic Index1)…to ensuring the long-term availability of sufficient numbers of appropriately skilled personnel.

Demographic change

- LTIF: 3/1,000,000 h- Most employees of

companies based in Germany have access to some means of measuring their personal WAI

- Number of accidents per million working hours (LTIF: X/1,000,000 h)2)

- Introduction of the Work Ability Index3) (WAI) in %

…to ensuring that all our own and sub-contractors’employees return home at the end of the day just as healthy as they were when they arrived at their workplace.…to maintaining our employees’ productivity.

Occupational health and safety

- 100% compliance

- 100% coverage

- Compliance with licensing requirements in %

- Group-wide environmental management coverage in %

…to operating our plants safely at all times and in compliance with licensing regulations.…to implementing our environmental management system permanently at 100 % in order to supervise the safe operation of our plants and networks in compliance with statutory regulations

Environmental protection

95% coverageGroup wide innovation management coverage in %

…to ensuring the availability of the best technical solutions for our purposes in our core processes through innovations.

Innovations

95% of the procurement volume

Supplier management coverage in all procurement areas in %

…to avoiding reputational risks by making compliance with internationally recognised social and environmental standards an integral part of our supply contracts.

Supply chain

TargetKPIWe are committed…Field of action

1) The RWE Demography Index is made up of five workforce age structure indicators. The index is determined based on a comparison to targets. This results in the Demography Index, with rankings between 0 (high demographic risk) and 100 (low demographic risk). 2) Workplace and business travel accidents per million working hours.3) The Work Ability Index is a standardised yardstick that reveals the degree to which an employee is capable of doing his or her work, determined on the basis of individual skills and work conditions.



In parallel, CO2 scrubbing for lignite and hard coal will be developed further for advanced conventional power planttechnology:> RWE npower is going to build a 3 MW carbon dioxide capture pilot plant at its Aberthaw coal power station in South Wales.

When commissioned, it will be the UK’s biggest carbon capture pilot plant.> RWE Power, BASF and Linde have joined forces to develop new processes for CO2 capture from combustion gases

in coal-fired power plants. A pilot scrubbing plant for power station flue gases in Niederaussem was put into operation in August 2009.

> American Electric Power (AEP), RWE and Alstom are collaborating in a similar project, which has been implemented in the AEP hard coal-fired Mountaineer plant (1,300 MW) in New Haven, West Virginia, USA.

1) IGCC: Integrated Gasification Combined Cycle.

2) CCS: Carbon Capture and Storage.

2

RWE Power is considering developing and building a virtually CO2-free 450 MW coal-fired IGCC1) plant including CO2transport and storage to demonstrate the whole CCS2)-chain. The new power plant would be fuelled by Rhenish lignite resources. But we are facing serious problems: > Lacking acceptance at intended storage site in Schleswig-Holstein (northern Germany) > No funding for the project as a whole within the scope of the European Energy Programme for Recovery (EEPR)> No viable regulatory framework for CCS in Germany at present

1

The Technology of the Future: RWE to Gain Leadership in Europe in Virtually CO2-free Power Plant Technology



In 2009, RWE Spent €2,229 Million1) on Environmental Protection

1) Including capital expenditure.2) E.g. operation of flue gas desulphurisation systems.3) Mainly wastewater treatment.4) E.g. recultivation projects at Rhenish opencast mines.

Climate protection €1,482 million 66%

Clean air2) €345 million 15%

Waste disposal €172 million 8%

Water protection3) €127million 6%

Landscape conservation4) €87million 4%

Noise abatement €10 million 1%

Restoration ofcontaminated sites €6 million 0%


Total: €2,229 million(2008: 2,115 million)


RWE AG Shareholder Structure*)

> 260,000 shareholders own 562.4 million shares.> 80% of all RWE shares are held by institutional investors. > The regional breakdown is as follows:

> Free float 80%(excluding RW Energie-Beteiligungsgesellschaft and own shares)

80%All institutional shareholders:

16%RW Energie-Beteiligungsgesellschaft

4%BlackRock

60%Other institutional shareholders

*) As of December 2009.

Financial Information – RWE ShareMarket DataPolitical EnvironmentAt a Glance RWE

1%Employee shareholders

Shares of subscribed capital

5%Own shares

14%Private shareholders

2%Rest of the world13%Continental Europe (excl. Germany)12%UK/Ireland17%USA/Canada36%Germany


RWE Share Profile*)

39,000,000 preference shares39,000,000 preference shares

523.4 million common shares494.6 million common shares28.8 million common shares

Total number of sharesTotal number of shares outstandingTotal number of treasury shares

Non-par-value sharesCommon shares Preference sharesShare information

Germany – official –Frankfurt/Main DüsseldorfXetraAbroadSIX Swiss Exchange (secondary listing)New York, OTC trading(Sponsored level-one ADR programme for common shares)

Listings–74975E303US CUSIP No. (ADR)1158 8901158 883Swiss Security ID Code703714703712German Security Identification No.DE 000703 7145DE 000703 7129ISINRWE3 GYRWE GYBloomberg

RWEGpr.F (Frankfurt)RWEGpr.DE (Xetra)

RWEG.F (Frankfurt)RWEG.DE (Xetra)

Reuters

*) As of April 6, 2010.



2001 2002 2003 2004 2005 2006 2007 2008 2009

RWE's Dividend Policy (I)

Dividend yield based on year-end price of RWE common shares%

2001 2002 2003 2004 2005 2006 2007 2008 2009

Dividend per share€

Bonus€0.10

4.2%

€3.50

*) Truncated fiscal year of RWE AG from July 1 to December 31, 2001.

*)

3.2% 4.5% 4.0% 3.7% 2.8%

€1.00 €1.00 €1.25 €1.50 €1.75

3.3%

€3.15 €4.50

7.1%


5.2%

€3.50


RWE's Dividend Policy (II)

Payout trendDividend payout (€ million)

1,867

2,401

1,689

1,968

984

619703

844

0

500

1000

1500

2000

2500

3000

2002 2003 2004 2005 2006 2007 2008 2009 2010e - 2013e

One-off payoutratio increase

(sale of Thames Water)

One-off payoutratio increase

(sale of 39.5% of American Water)

3,000

2,500

2,000

1,500

1,000

500

0

Regular payoutratio of

50% – 60%*)


*) Based on recurrent net income.


> Defines investment strategy> Sets guidelines for the implementation

> Members: CFOs of RWE AG, RWE Power, RWE npower, RWE Dea, enviaM, Lechwerke, Süwag, Head of Finance of RWE AG

As of December 31, 2009.

RWE AG Group Finance

Investment guidelines

Master “KAGs”: RWE AG Group

> "Spezialfonds": 11> Subfunds: 44

> RWE AG subsidiaries: €2.4 bn> RWE Pensionstreuhand e.V. (PTV): €3.3 bn> RWE Pensionsfonds AG (PF): €5.8 bn

> UK Pension Trust - RWE npower: £3.5 bn

Assetmanagement

contract

Asset Management Committee (AMC)

Recommendations &reporting

Investment strategy,guidelines & restrictions

> Centralised asset management by RWE AG

Internal management External management

Master “KAGs”: PTV + PF

> "Spezialfonds": 4> Subfunds: 59

Financial Information – Fixed Income FinancingMarket DataPolitical EnvironmentAt a Glance RWE

Management of Financial Assets: Centralised Structure


0%

5%

10%

15%

20%

25%

30%

Min15%

Strategic Asset Allocation (SAA) Target Portfolio

> SAA is defined for each subsidiary by weight per asset class; not single securities

> Each asset class is defined by a specific benchmark index> SAA is reviewed once a year

Equity Range

0%

15%

30%

45%

60%

75%

90%

Europe

USAPacific

Totalequity

Max25%

Max85%

Min75%

Bond Range

Total bonds

US high yield

European bonds

Asset Management: Investment Strategy (excl. Plan Assets)


Equities 20%

Bonds 80%

Max. Min. Strategic asset allocationMax. Min. Strategic asset allocation


Strategic Asset Allocation (SAA) Target portfolio

> SAA is defined by weight per asset class; not single securities > Each asset class is defined by a specific benchmark > Evolution of the SAA is based on an asset liability study

Equities 29%

Bonds 58%

Alternative investments 10%

Real estate 3%

0%5%

10%

15%

20%

25%

30%

Min24%

0%15%

30%

45%

60%

75%

90%Totalequity

Max34%

Max76%

Total bonds

Min53%

Bond range

Europe

USAPacific

Emergingmarkets

EasternEurope

Equity range

Bonds 10+

Corporates US high yield

Asset Management: Investment Strategy (Domestic Plan Assets; Smaller Plans Deviate Slightly)

Max. Min. Strategic Asset AllocationMax. Min. Strategic asset allocation


35%


RWE's Corporate Treasury – Basis for Groupwide Financial Risk Management

RWE AG

Liquidity transfer via cashpool Hedging (fx, interest rates) Intercompany loans

RWE subsidiaries

> RWE AG acts solely as external counterparty for financial transactions (excluding regulatory requirements)> Corporate Group Treasury has the overall responsibility for treasury operations> Central database for groupwide financial risk management

External market

Capital market

Ratings

FX deals (incl. derivatives)

Interest deals (incl. derivatives )

CP programme

Money market



RWE AG: Strong Sources of Financing


0,0

0,5

1,0

1,5

2,0

2,5

2010

2015

2020

2025

2030

2035

2040

0

4

8

12

16

20

Capital market debt maturities*)

> Balanced profile with limited maturities2010 - 2013 (~€4.0 billion)

€ billion

Maturities of debt issued

— Accumulated outstanding debt

Fully committedsyndicated loan(€4.0 bn up to Oct. 2011)

Commercial paper(up to 1 year)

$0.3 bn ($5.0 bn)

€0.0 bn

€0.3 bn (June 30, 2010)

for liquidityback-up

Strong sources of financing

MTN programme(up to 30 years)

€30 bn

€17.2 bn (June 30, 2010)

*) RWE AG and RWE Finance B.V., as June 30, 2010.

2.5

2.0

1.5

1.0

0.5

0.0


Gross Financial Debt – Currency and Interest Exposure*)

Gross financial debt - currency

£ 36%

€ 61%

*) Including cross-currency swaps; as of June 30, 2010.

We hedge the translation risk of our international activitieswith debt in foreign currencies.

Gross financial debt - interest exposure

Fixed 81%

Floating 19%

$ 1%


Others 2%


Securing A-flat rating remains a major goal Leverage factor as an operational tool

> RWE is well positioned with an A-flat / A2 rating compared to peers

> Rating category has proven right during financial market crisis

> Target is to keep leverage factor below or equal to 3.0

> Target can be exceeded in single years but has to be brought back to < 3.0 thereafter

> Leverage factor remains the main internal tool for managing our rating category

2.8

2.12.12.5

Major Goal Remains to Secure Sound Credit Standing as Expressed by A-flat/A2 Rating

≤ 3.0

2006 2007 2008 2009 2010onwards

Net Debt/EBITDA

Target

RWE

Centrica CEZEdF EdP Ene

lEON

GdF S

uez

Iberdrol

a

AAA Aaa

AA

A

BBB

Aa2

A2

Baa2

Moody‘s

S&P

Source: Bloomberg.July 27, 2010.



Credit Rating 2010 – RWE AG

> On January 13, 2009, Standard & Poor's revised its outlook on RWE’s rating to negative from stable, following RWE'sdebt-funded bid for the unregulated generation and supply businesses of Essent N.V.

> The ratings for RWE AG are underpinned by its leading domestic position in power generation and supply in Germany, its focus abroad on northwestern European countries with power markets increasingly linked to the German power market, and its significant share of regulated earnings (about 30% of total earnings). These strengths are partly offset by the high carbon intensity of RWE's generation fleet and resulting exposure to the tightening of carbon constraints in the EU, especially from 2013; its exposure to wholesale power prices, although this is mitigated by the group's prudent strategy of selling forward the bulk of its output; heightened regulatory pressures in Germany; and the weakening of its financial profilefollowing the €7.3 billion debt-financed acquisition of Dutch utility Essent N.V. (A/Negative/A-1), which was completed in September 2009.

> The negative outlook reflects the view that RWE's financial profile is below S&P’s expectations for the ratings following the Essent acquisition and the uncertainty as to its recovery to levels in line with the ratings. It also reflects S&P’s opinion that RWE could opportunistically consider midsize debt-funded acquisitions in Eastern Europe.


Standard & Poor's (A, "Outlook Negative") Moody's (A2, "Outlook Negative")

> On November 4, 2009, Moody’s downgraded the long-term senior unsecured debt ratings of RWE AG to A2 from A1. The outlook on all ratings is negative.

> The rating actions follow the completion by RWE of its acquisition of 100% of Essent N.V. in a transaction valued at approx. €7.3 billion. While acknowledging the positive impact which the combination with Essent has on certain aspects of RWE’s business risk profile, these are offset, in Moody’s view, by the weaker financial flexibility implied by the enlarged Group’s debt burden.

> The negative outlook reflects the risk in Moody’s view that, in the current challenging operating environment and given its substantial capital investment programme the Group’s earnings might not grow sufficiently to compensate for higher debt levelsand that credit metrics therefore remain weaker than appropriate for the A2 rating category.


RWE AG: Financial Risks and Managing Interest Rate Risk –Asset/Liability Management


Main financial risk factors are:> RWE Group companies are

subject to strict risk management

> Financial derivatives are not to be used for speculative purposes and serve only to hedge risks arising from operations

Interest rate riskForeign exchange (FX) risk Counterparty risk

Interest-bearing debt

Assets under management

Investments

Other financial positions, e.g. derivatives, collateral

FX hedges for commodities

*) Average Value at Risk (95/1) in Q1 – Q4 2009.

Assets

Liabilities

> Measurement of portfolio life vs. benchmark life> Analysis of value at risk of bond portfolio (Value at Risk €21.3 m*)

> Measurement of market values and value at risk of financial debtand derivatives (portfolio view; Value at Risk €167.8 m*)

> Sensitivity analysis of interest rate curve movements for net interest and the underlying market values

> Target/actual comparison of net interest


RWE Bond Programme

Major bonds issued by the RWE Group*)

*) As of February 15, 2010.

Issuer Currency PlacementCurrency Issuance

Volume (m)

Volumein € (m)

Termin Years

Issuance Date

Maturity Date

Coupon (%)

German Securities

CodeISIN

RWE AG NOK Private 250.0 31.0 7 18.06.2003 18.06.2010 4,890 748538 XS0170287238RWE AG SGD Private 50.0 26.0 7 08.07.2003 08.07.2010 2,300 748539 XS0171753600RWE Finance BV GBP Public 500.0 576.3 7 03.07.2003 17.08.2010 4,625 878796 XS0170731847Redemptions - 2010 633.4RWE Finance BV EUR Public 1,500.0 1,500.0 2 16.06.2009 16.09.2011 2,500 A1AH10 XS0434069497RWE Finance BV EUR Public 1,808.0 1,808.0 11 26.04.2002 26.10.2012 6,125 855327 XS0147030554RWE Finance BV USD Public 250.0 183.7 3 11.02.2010 11.02.2013 2.000 A1ATAH XS0485309156RWE Finance BV GBP Public 630.0 726.1 11 26.04.2002 03.06.2013 6,375 855329 XS0147048259RWE Finance BV EUR Public 1,000.0 1,000.0 5 20.11.2008 20.11.2013 5,750 A0T3SN XS0399648301RWE Finance BV EUR Public 530.0 530.0 10 23.07.2004 23.07.2014 4,625 A0DAN1 XS0196302425RWE Finance BV EUR Public 2,000.0 2,000.0 6 09.02.2009 10.02.2015 5,000 A0T6L5 XS0412842428Redemptions 2011 - 2015 7,747.9RWE Finance BV EUR Public 850.0 850.0 15 20.04.2001 20.04.2016 6,250 648661 XS0127984747RWE AG EUR Private 100.0 100.0 15 15.11.2002 15.11.2017 floating 748536 XS0158243013RWE Finance BV EUR Public 980.0 980.0 15 23.07.2003 23.07.2018 5,125 957955 XS0172851650RWE Finance BV EUR Public 1,000.0 1,000.0 10 20.11.2008 31.01.2019 6,625 A0T3SP XS0399647675Redemptions 2016 - 2020 2,930.00RWE Finance BV GBP Public 570.0 657.0 20 20.04.2001 20.04.2021 6,500 648663 XS0127992336RWE Finance BV EUR Public 1,000.0 1,000.0 13 09.02.2009 10.08.2021 6,500 A0T6L6 XS0412842857RWE Finance BV GBP Public 500.0 576.3 13 06.07.2009 06.07.2022 5,500 A1AJN3 XS0437307464RWE Finance BV GBP Public 487.5 561.9 20 03.07.2003 06.12.2023 5,625 878761 XS0170732738RWE Finance BV GBP Public 760.0 876.0 28 26.04.2002 03.06.2030 6,250 855328 XS0147048762RWE AG EUR Private 600.0 600.0 30 14.02.2003 14.02.2033 5,750 748537 XS0162513211RWE Finance BV GBP Public 1,000.0 1,152,6 30 06.07.2009 06.07.2039 6,125 A0AJN2 XS0437306904RWE AG JPY Private 20,000.0 163.4 30 17.02.2010 17.02.2040Redemptions - 2021 onwards 5,587.1Total 16,898.4Currency exchange rates: CHF GBP NOK USD SGD YPY(€1 =) 1.4661 0.8676 8.0530 1.3607 1.903 122.420



RWE Securities

Securities in RWE's Group accounts as of March 31, 2010

Securities held as non-current assets: € 220mSecurities held as current assets: € 3,451mTotal securities: € 3,671m

Fixed income 82%

Equities/other 18%



Organisation of Risk Management in the RWE Group

RWE Group Center

Risk CommitteeRisk Management Committee Asset Management Committee

> Supervises commodity price and credit risk management in operating companies

> Members: CFO of RWE AG, heads of the Group Risk Management, Group Finance and Value Chain Management Departments of RWE AG, CFOs of RWE Power, Essent, RWE Dea, RWE Vertrieb, RWE npower, RWE Transgas, RWE Supply & Trading and RWE Innogy

Group Risk Management

> Responsible for implementing, monitoring and refining the groupwiderisk management system

> Members: heads of RWE AG’s Compliance, Corporate Controlling, Finance, Risk Management, Legal/Corporate Matters, Accounting, Strategy, Audit and Insurance Departments

> Manages risks associated with investments in securities

> Members: CFO of RWE AG, Head of Corporate Finance, CFOs of RWE Group companies with security investments or pension assets

RWE AG Executive Board

Risk ManagementMarket DataPolitical EnvironmentAt a Glance RWE

Operating companies


RWE's Commodity Risk Management Infrastructure

> Overall responsibility for risk management system> Defines the Group's commodity risk appetite and establishes principles of the Group‘s commodity risk

strategy> Defines global limit structures and hedge policies for operating companies

> Monitors commodity risks and commodity risk management in operating companies with regard to both the market and the credit side

Risk Committee (headed by CFO of RWE AG)


> Develops market and credit risk strategies, guidelines and frameworks for commodity risk management> Is responsible for the approval of methods and models for the valuation of commodity risks > Details the global limit structure and risk policies of operating companies in cooperation with Value Chain

Management> Analyses and approves credit limits for large commodity counterparties, large suppliers and banks

Group risk management

> Handles operative commodity and credit risk management> Controls and monitors commodity risk positions

Operating companies

Value chain management

> Establishes the infrastructure for implementing risk strategies of operating companies in internal commodity markets

> Defines and dynamically adjusts hedging strategies for liquid commodity positions and approves large commodity transactions in co-operation with Group Risk Management



RWE Supply & Trading Commodity Risk Limit System

> RWE Supply & Trading is the RWE Group’s interface to the wholesale markets for energy and energy commodities, while serving as an internal transaction partner for hedging commodity risks

> The global risk limits in the energy trading business are set and constantly monitored by the Executive Board of RWE AG and the Risk Committee

> Risk limits are then further detailed:


Global limits for market and credit risks/singlecounterparty limits

granted by

granted by

granted by


Group Risk Management (to be agreed with Value Chain Management)

RWE Supply & Trading Board

Detailed commodity and credit limits

Limits for single desks/books/traders/individual counterparties

restrict

restrict


Credit Risk Management at the RWE Group


> Bundling of know-how in a central credit risk management unit> RWE Supply & Trading was a key driver of the EFET*) standards for power and gas with more than 130

EFET agreements having been signed so far> RWE Supply & Trading plays a leading role in the development of exchanges/OTC clearing

Driver of credit risk mitigation

> Counterparties are assessed using internal rating tools. The results are mapped to the results of an external rating, if available

> All counterparties are monitored frequently and reviewed on a regular basis

Robust counterparty risk assessment and monitoring

> Credit capital costs are based on the rating of a counterparty > Performance determination includes credit risk charges

Clear credit incentives

> Potential future credit exposure (= potential replacement value) is calculated with a Value-at-Risk-like methodology

> In addition, both current and future settlement exposure is measured> Counterparty credit exposures are reviewed on a near-real-time basis

State of the art measurement and monitoring of exposures

> Groupwide credit policy has been established. Above all, it is based on overall limitation and maximum individual counterparty limits and tenors (based on the creditworthiness of a counterparty) for upper-size business

High-level credit policy

*) EFET: European Federation of Energy Traders.


Political Environment


RWEMarket DataAt a Glance Political Environment

57 Combined Heat and Power Generation (CHP) Act

58 Renewable Energy Act64 Emissions Trading66 National Allocation Plan II69 Large Combustion Plant Directive

(LCPD)71 Network


The German Energy Industry Act: Key Elements of Network Fee Calculation 73The German Energy Industry Act: Unbundling in the German Energy Grids 72The German Energy Industry Act: Regulating Network Access and Network Usage Fees in the Electricity and Gas Markets 71

Network [71 – 73]

CDM/JI Projects Give RWE Access to Cost-effective Reduction of Greenhouse Gas Emissions (I) 66

Renewable Energy's Share of Total Electricity Generation in Germany 61German Renewable Energy Act Compensation and Forecast through 2015 62

Renewable Energy Act [58 – 63]

German Renewable Energy Act (II) 59Renewable Energy Surcharges Expected to Increase further 60

Subsidy Efficiency: Contribution of German Renewable Energy Act – Subsidised Power Generation in 2008 63

The EU Large Combustion Plant Directive (LCPD) 69

CDM/JI Projects Give RWE Access to Cost-effective Reduction of Greenhouse Gas Emissions (II) 67

German Combined Heat and Power Generation (CHP) Act 57

Large Combustion Plant Directive (LCPD) [69 – 70]

NAP II [66 – 68]

Emissions Trading [64 – 65]

Political Environment [57 – 73]

Due to the LCPD a Shut-down of 11–12 GW by the End of 2015 (or Earlier) is Expected in the UK 70

RWE's Current Kyoto Credit Portfolio for 2008 – 2012 68

Emissions in Germany, UK and EU-27 (2009) 65Allocated CO2 Allowances in Germany, UK and EU-27 (2009) 64

German Renewable Energy Act (I) 58

Combined Heat and Power Generation (CHP) Act [57]

Table of Contents


German Combined Heat and Power Generation (CHP) Act*)

Network operators have the right to pass on all feed-in paymentsPassing-on clause

Max. 0.05 ct/kWh for large consumers with a yearly consumption of more than 100,000 kWh Max. 0.025 ct/kWh for energy-intensive industry (> 4% of energy costs of gross production value)

Limitation of the burden on industry

Allocation to total supplies to end customers from the public supply gridFunding

Annual cap of €750 million including € 150 million for heat pipes.€524 million in 2008; €4,899 million since April 2002

Volume

Specific subsidisation of CHP plants dependent on– Commissioned since January 1, 1990– Modernised plants– Small plants– Block-type central cogeneration and fuel cell plants

Levels of subsidy

Electricity actually generated in CHP plants (back pressure) including internal consumption of industry Support is no longer connected to the feed into supply grids

Object of subsidy

Modernisation and new build of high efficient CHP plants for energy conservation and CO2 reduction 25% share of CHP electricity generation by 2020

Aim

Effective since April 2002 with amendment which came into effect as of January 1, 2009 Term

CHP legislationIssue

*) Figures and scheme taken from the amendment in 2008 effective January 1, 2009.

CHPMarket DataPolitical EnvironmentAt a Glance RWE


German Renewable Energy Act*) (I)

Grid operators have the right to pass on all surcharge payments to the suppliersPassing-on clause

Hardship clause came into effect as of January 1, 2006; reduced amount of 0.05 ct/kWh if a company consumes more than 10 GWh and electricity costs are at least 15% of gross production value

Limitation of the burden for industry

Amount allocated to total supplies to end customers from the public supply grid was about 1 ct/kWh in 2008

Funding

Approx. €9.9 billion feed-in tariffs in 2009 without system costs (grid, balancing power); projection for 2010: €12.4 billion, projection for 2012: €16.8 billion

Volume

Different price schemes for existing and new renewable plants (wind, water, biomass, solar)Levels of subsidy

Electricity actually generated in renewable plants which feed into the supply gridObject of subsidy

Supports introduction of renewables-based electricity generation plants and helps to meet the emissions reduction target set by the federal government: min. 30% electricity production from renewables by 2020

Aim

Effective since April 2000 and amended on August 1, 2004 and January 1, 2009 Different support of plants with service lives of up to 20 years

Term

Renewable energy legislationIssue

*) Figures and scheme taken from the German Renewable Energy Act effective as of January 1, 2009.

Renewable Energy ActMarket DataPolitical EnvironmentAt a Glance RWE


German Renewable Energy Act1) (II)

31.94 – 43.01as of July 1, 2010: 25.02 – 34.05 as of Oct. 1, 2010: 24.26 – 33.03

Photovoltaics3)

5.02 – 9.20 (onshore)3.50 – 15.00 (offshore)

Wind power

10.50 – 23.00Geothermal energy

7.79 – 23.09Biomass

4.16 – 9.00Landfill gas, sewage gas, pit gas

3.50 – 12.67 Hydropower

1) Figures and scheme taken from the German Renewable Energy Act effective as of January 1, 2009.2) Depend on size of plant, year of commissioning operation and technology.3) Reduction of subsidy rate approved by the German Upper and Lower House Mediation Committee;

revised law still pending (July 13, 2010).

Sources: Bundesministerium für Umwelt, Naturschutz und Reaktorsicherheit(German Ministry for the Environment, Nature Conservation and Nuclear Safety).

Renewable Energy Act subsidy rates2)

ct/kWh



2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Power generated Power generated (forecast) Feed-in fees Feed-in fees (forecast)

€ billion

TWh1401201101009080706050403020100

Renewable Energy Surcharges Expected to Increase further

Development of power generated in accordance with the German Renewable Energy Act(REA) and REA surcharges for 2000 – 2012 (forecast)

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), July 2009.German transmission system operators (www.eeg-kwk.net), May 2009.

0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 10.0 16.09.0 12.0

130

11.0 14.013.0 15.0



39%

57%

32%

30% 4%

7%25%

6%

639 TWh

Renewable Energy's Share of Total Electricity Generation in Germany

1) REA = German Renewable Energy Act.2) After netting out avoided network fees.

Source: German Energy Balances Task Force, German Energy and Water Association (BDEW), February 2009; transmission system operators.

Gross generation in Germany (2008)

71 TWh

REA1) generation

€8.7 bn2)

REA compensation

Lignite

Nuclear

Hard coal

Other (including 4% hydro that is not REA-compensated)

Gas

PhotovoltaicHydro

Biomass

Wind13%

20%

23%

10%

23%

11%

Renewable energy (REA-compensated)


Photovoltaic

Hydro

Biomass

Wind


0

5

10

15

20

25

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Hydro Biomass Onshore wind Offshore wind Photovoltaic Other

1.61.22.2 2.6

3.6 4.5

5.8

7.9

20.4

22.0

9.0 10.0

12.3

14.6

16.8

18.85.4

5.8

5.3

4.9

0.5

0.1

2.2

3.6

2.60.4


€ billion (gross)

Source: REA medium-term forecast of electricity transmission system operators.

German Renewable Energy Act Compensation and Forecast through 2015

0.2


Subsidy Efficiency: Contribution of German Renewable Energy Act – Subsidised Power Generation in 2008Installed capacity MW

Power generatedTWh

Extra cost in millions of euros, based on an average electricity price of €60/MWh

80 23 1,562 1.6 1,127 0 1,953


25,000

20,000

15,000

10,000

5,000

0

60

50

40

30

20

10

0

Hydro Bio and pit gas

Biomass Geothermal Onshorewind

Offshorewind

Photovoltaic


Allocated CO2 Allowances*) in Germany, UK and EU-27 (2009)A

lloca

ted

allo

wan

ces

in G

erm

any

2009

Allo

cate

d al

low

ance

s in

Uni

ted

Kin

gdom

200

9

Electricity 55%

Other industries 3%

Metals 15%

Cement & lime 8%

Combustion 12%

Allo

cate

d al

low

ance

s EU

27 2

009

Emissions TradingMarket DataPolitical EnvironmentAt a Glance RWE

Refineries 7%

Electricity 51%

Other industries 3%

Metals 11%

Cement & lime 7%

Combustion 19%

Refineries 9%

Total : 392 million mt CO2


Electricity 50%

Other industries 4%

Metals 12%

Cement & lime 11%

Combustion 15%

Refineries 8%

Total : 1,959 million mt CO2

*) Excluding auctioned certificates and new entrant reserves. Source: Bloomberg.


Emissions in Germany, UK and EU-27 (2009)Em

issi

ons

in

Ger

man

y 20

09Em

issi

ons

in

Uni

ted

Kin

gdom

200

9

Electricity 69%

Metals 6%

Cement & lime 7%

Combustion 10%

Emis

sion

s EU

-27

2009

Emissions TradingMarket DataPolitical EnvironmentAt a Glance RWE

Refineries 6%

Electricity 67%

Other industries 2%

Metals 7%

Cement & lime 3%

Combustion 14%

Refineries 7%



Electricity 61%

Other industries 3%

Metals 7%

Cement & lime 8%

Combustion 13%

Refineries 8%

Total : 1,869 million mt CO2

*) Excluding auctioned certificates and new entrant reserves. Source: Bloomberg.

Other industries 2%


CDM/JI Projects Give RWE Access to Cost-effective Reduction of GreenhouseGas Emissions (I)

Source: UNFCCC; http://cdm.unfccc.int.

Clean Development Mechanism (CDM)

Emission reductions through investment by an industrialised country in a country without reduction commitments are credited to the emission account of the investor country

Joint Implementation (JI)

Emission reductions through investment by one industrialised country in a second industrialised country are credited to the emission account of the investor country

Germany/UK

Germany/UK E.g. Russia

Emission rights E.g. China

Emission rights

Investment

Investment

National Allocation Plan (NAP) IIMarket DataPolitical EnvironmentAt a Glance RWE


CDM/JI Projects Give RWE Access to Cost-effective Reduction of GreenhouseGas Emissions (II) Expected average annual certificates from registered CDM projects by host country in May 2010%

> By May 2010, the UN had approved nearly 2,213 CDM projects that are expected to supply more than 1.8 billion certificates by the end of 2012

> A substantial portion of the certificate volumes contracted are accounted for by Chinese projects

Source: UNFCCC; http://cdm.unfccc.int.

China 60.3

India 11.6

Brazil 5.8

Republic of Korea 4.1Mexico 2.6Malaysia 1.4Chile 1.3Argentina 1.2Nigeria 1.1Indonesia 1.1

Others 9.5



RWE's Current Kyoto Credit Portfolio for 2008 – 2012

Projects by March 2010 Contract volume by technology

0

20

40

60

80

100

120

Contract volume Risk adjusted volume RWE's RedemptionCapacity (2008 - 2020)

~ 100

Contract volume by region

Energy efficiency 13.09N2O 12.27HFC23 10.48 Other 7.40Biomass 4.78 Wind 2.96Coal mine methane 1.85 Solar 1.54Methane 1.33Biogas 0.98Hydro 14.41

China 44.15South Korea 8.01 South-East Asia 7.56 India 3.76 Egypt 3.64 Ukraine 1.44Eastern Europe 0.40LDCs 0.35South America 0.18

Risk-adjustedvolume


In validation phase

Inoperation2)

ERPA1)

Inoperation2)

In validation phase

ERPA1)

1) ERPA = Emissions Reduction Purchase Agreement.2) In operation: All projects which have already issued certificates.3) Latest EU directive for certificates implies that RWE Power will not have additional redemption capacity for 2013 to 2020, but certificates

can still be used after 2012. Figure including RWE Power, RWE npower, Essent.

RWE's redemptioncapacity (2008 – 2020)3)

Contractvolume

Million certificates


The EU Large Combustion Plant Directive (LCPD)

Step 1

> Power plants had to choose whether to comply with the LCPD or request a limited life derogation (opt out)> Power stations which opted out are allowed to run for 20,000 hours, or until the end of 2015, whichever comes sooner

Step 2

Those power stations which comply with the LCPD are governed in one of two ways*):> Emission Limit Value (ELV)

The power station must adhere to specific limits to the amounts of pollutants produced on a "milligramme per cubic metre of waste gas" basis

> National Emission Reduction Plan (NERP) A company is given an overall allowance (amount of a pollutant that can be emitted per year) of emissions it may produce. The emission allowances issued under NERP are tradable within a member state

Step 3

> In addition to the above, existing oil and coal-fired power plants must reduce nitrogen oxide emissions from 500 mg/Nm3 to 200 mg/Nm3

by January 1, 2016. This will entail fitting selective catalytic reduction (SCR) equipment

*) While most the EU member states, including Germany, chose to implement Emission Limit Values (ELV), a number have opted for National Emission Reduction Plans (NERPs), while in the UK individual power plants could choose between being regulated on the ELV, or under a NERP.

Since 2008, coal and oil-fired power stations have been governed by the Large Combustion Plant Directive (LCPD). This imposes new limits on the amounts of sulphur dioxide (SO2), nitrogen oxides (NOx) and dust power stations can emit.

LCPDMarket DataPolitical EnvironmentAt a Glance RWE


Due to the LCPD a Shut-down of 11–12 GW by the End of 2015 (or Earlier) is Expected in the UK

LCPDMarket DataPolitical EnvironmentAt a Glance RWE

11,84221,997257133,839TotalFitted039313393CoalUskmouth PowerUskmouthNo FGD1,1520241,152CoalScottish PowerCockenzie1 unit fitted02,304142,304CoalScottish PowerLongannetN/A01,320121,320CCGTScottish & Southern EnergyPeterheadFitted02,000142,000CoalScottish & Southern EnergyFiddlers FerryFitted1,0001,000242,000CoalScottish & Southern EnergyFerrybridgeNo FGD1,0200241,020CoalRWE npowerTilburyNo FGD1,0000121,000OilRWE npowerFawleyNo FGD1,3700131,370OilRWE npowerLittlebrookFitted01,500131,500CoalRWE npowerAberthawNo FGD2,0000142,000CoalRWE npowerDidcot AFitted01,000121,000CoalInternational PowerRugeleyFitted02,000242,000CoalEDF EnergyWest BurtonFitted02,000142,000CoalEDF EnergyCottamNo FGD1,3000121,300OilE.ON UKGrainNo FGD1,0000121,000CoalE.ON UKIronbridgeFitted02,000142,000CoalE.ON UKRatcliffeNo FGD2,0000142,000CoalE.ON UKKingsnorthFitted03,960163,960CoalDrax PowerDrax2 units fitted02,000142,000CoalBritish EnergyEggboroughfitted052012520Coal/OilAESKilroot

FGD3) statusCapacity opted out2)

(MW)

Capacity opted in1)

(MW)

Number of plants

Numberof boilers

Installed capacity

(MW)

FuelOperatorInstallation

1) Compliant with LCPD emission limits (Drax, Eggborough, Peterhead and Longannet in NERP). 2) Limitation of operating hours to 20,000 between Jan. 1, 2008 and Dec. 31, 2015. No requirement to fit FGD.3) FGD: flue gas desulphurisation. Source: company information.


The German Energy Industry Act: Regulating Network Access and NetworkUsage Fees in the Electricity and Gas Markets

Unbundling of networks from generation, wholesale and retail

(number of operators)

Exploration/ generation

Regulation of network access and network usage fees

Retail

Competition

CustomersExchange

tradingOTC

CompetitionCompetition

Transport Bundesnetz-

agentur*)

(electricity: 4, gas: 14) Distribution

federal states(ca. 1,200)

DistributionBundesnetzagentur*)

(ca. 300)

NetworkMarket DataPolitical EnvironmentAt a Glance RWE

*) German Network Agency.


The German Energy Industry Act: Unbundling in the German Energy Grids

TSO1)

1) TSO = Transport System Operator.

2) DSO = Distribution System Operator.

DSO2)

>100,000 customers

DSO2)

<100,000 customers

Legalunbundling

Obligatory

Obligatory

Functionalunbundling

Obligatory

Detailed rules to unbundlestaff, equal treatmentprogramme

Accountingunbundling

Obligatory

Auditor's certificate

Separate balance sheets and profit and loss accounts mustbe disclosed and sentimmediately to the regulator



The German Energy Industry Act: Key Elements of Network Fee Calculation

> All network usage fees must be approved ex-ante. All ex-ante approvals can be revoked by the German Network Agency at any time

> The permitted proportion of equity-financed assets is restricted to 40%

> Current cost accounting for rate of return and imputed depreciation will continue to apply for all investments until December 31, 2005

> All investments as from January 1, 2006, will yield interest based on inflation-adjusted historic cost accounting and be subjected to imputed depreciation

> Tax treatment:– No recognition of corporation taxes (incl. taxes on

fictitious profit) until the incentive-based regulation has entered into force but recognition of „Gewerbe-steuer” (trade tax)

– Recognition of the taxes on fictitious profit as from the introduction of incentive-based regulation. At the same time, adjustment of the required rates of return

Improved conditions for upcoming incentive-based regulation as of 2009: > Improved returns on equity

7.56% for existing electricity and gas assets and 9.29% for new investments> Special treatment of investment in growth and restructuring

Fast-track treatment of large budgeted growth investment projects by the regulator to ensure adequate and timely remuneration for utilities> Increase of expected average efficiency> Average efficiency of German electricity distribution companies estimated at 94% indicating average company-specific efficiency targets of only

1.0% p.a. ("individual X factor")

6.5

7.91 7.56

6.37

7.8

9.29

7.82

9.21

0

1

2

3

4

5

6

7

8

9

10

Current allowed RoE First proposal Final decisionFirst proposal Final decision

10.00

9.00

8.00

7.00

6.00

5.00

4.00

3.00

2.00

1.00

0.00

GasElectricity

Investments before 2006 Investments since 2006

%



Market Data


RWEPolitical EnvironmentAt a Glance Market Data

77 Electricity115 Gas


Transfer Capacity in Europe from and to Germany (Winter 2009/2010) 102Germany: Import and Export of Electricity (2009) 101Germany's Transmission System Operators (2009) 100The European ENTSO-E Power Transmission Grid 99

Grid [99 – 102]

Major European Electricity Exchanges 97Trading [97 – 98]

Power Trading Volumes in Continental Europe 2001 – 2009 98

Fuels [93 – 96]

Reach of Uranium Reserves (II) Reach of Uranium Reserves (I)

Balancing Power: How Does it Work?

Wind Generation Works More or Less Like Negative Demand

Growing Number of Cancellations Increases Efficiency Gap and Value of RWE's New-build Projects

German Energy and Power Mix (2009)

9695

92

89

82

80

CO2 Reduction Potential of Coal-fired Power Plants by Increased Efficiency

Electricity [77 – 115]Market Data [77 – 133]

Main Sea Freight Trading Routes for Hard Coal (II) 94Main Sea Freight Trading Routes for Hard Coal in 2009 (I) 93

Power Generation Capacity Remaining in Europe and Germany 91

The CO2 Cap-and-trade System has Reduced the Gap in the Merit Order between Upper Base-load and Lower Peak-load Electricity

90

The Merit Order and Aspects Influencing its Structure Provide a Better Tool for Looking at the Dynamics of Power Plant Portfolios 88Nuclear Power Plants in Germany: Remaining Capacities after Shut-Down 87Residual Electricity Volumes of Nuclear Power Plants 86

85Power Generation in Germany: CO2 Emissions per Plant Type 84Attractiveness of Coal and Gas Differs in Germany and the UK 83

UCTE Methodology for Evaluating the Generation Capacity Remaining in Europe 81

Capacity Trends in 50 Years of Thermal Power Generation in Europe: Gas on the Rise since 1993 79Europe's Total Generation Capacity: 922 GW Gross, 859 GW Adjusted Net 78Shares of Primary Energy Sources in Total Electricity Generation in Europe (2009) 77

Generation [77 – 92]

Table of Contents


Czech Gas Market: Basics of the Regulatory Framework 132Czech Gas Market: Gas-Price Setting Mechanism 131Status of Czech Gas Market Liberalisation and Regulation 130Relevant Institutions and Their Role in Regulating the Czech Gas Market 129European Gas Trading Points 128Natural Gas Supplies in Germany (2009) 127Grid Access in the German Gas Market 126Government Charges Included in the German Gas Price 125German Residential Gas Prices from 1999 to 2009 Compared with Other European Countries 124German Residential Gas Prices Compared with Other European Countries 123Europe's Largest Gas Companies (2009) 122

Downstream [122 – 132]Present Liquefied Natural Gas (LNG) Production Capacity (2009) (II) 121Present Liquefied Natural Gas (LNG) Production Capacity (2009) (I) 120

Blackouts in Europe in Minutes (2008) 113

Shipments of Liquefied Natural Gas (LNG) to Europe in 2009 119How the Liquefied Natural Gas (LNG) Value Chain Works 118

Gas [115 – 132]LNG [115 – 121

Supply [103 – 114]

Government Charges Account for 41% of German Household Electricity Bills

Industrial Customers Pay Higher Governmental Charges, but Net Electricity Prices are 6% below the Level of 1998

German Households Rank Second in Terms of State-Caused Charges on the Electricity Bills

112

110

107

The Largest Electricity Companies in Europe (2009)

Electricity [77 – 114]Market Data [77 – 132]

LNG is Becoming an Increasingly Important Component of Global Gas Supply 117The New Global Gas “Gearbox” – Mainly Driven by LNG 116Gas Markets Develop and are Getting Global – Flexibility Becomes Key Success Factor 115

The Largest Electricity Companies in Germany in Terms of Sales to End Customers (2008) 114

Government Inflates German Electricity Bills 111

German Electricity Consumption Fees 109Competition Has Been a Reality since 1999: Freedom of Choice for German Residential Electricity Customers 108

Pan-European Comparison of the Household Electricity Prices 106Electricity Prices in Europe (for Industrial Customers) 105Development of Energy Consumption in Germany 104

103

Table of Contents


66.5

90.4

83.5

36.3

71.0

541.8

593.0

59.4

40.0

29.7

289.9

3.6

111.6

154.6

46.0

29.5

297.7

137.0

374.4

0 100 200 300 400 500 600 700

Shares of Primary Energy Sources in Total Electricity Generation in Europe (2009)

0% 20% 40% 60% 80% 100%

UK

Sweden

Spain

Slovak Republic*

Portugal*

Poland*

Netherlands

Luxembourg*

Italy

Ireland*

Hungary*

Greece*

Germany

France

Finland

Denmark*

Czech Republic*

Belgium

Austria* Nuclear

Hydro

Wind

Gas

Oil

Coal/Lignite

Other

Total power generation

Source: Enerdata, 2010.

% TWh

0 20 40 60 80 100

Electricity – GenerationMarket DataPolitical EnvironmentAt a Glance RWE

*) 2008 data.


*) Assumptions: Net capacity is 93% of gross capacity for conventional power plants; recognition of plants > 10 MW for conventional power plants in Eastern Europe,of plants > 20 MW for the rest of Europe.

Sources: Platts Database, CERA, RWE.

Countries

AustriaBalkan (5)Baltic (3)BelgiumBulgariaCzech RepublicDenmarkFinlandFranceGermanyGreeceHungaryIrelandItalyLuxembourgNetherlands

Generation structure in 2008

NorwayPolandPortugalRomaniaSlovakiaSloveniaSpain

SwedenSwitzerlandUK


Europe's Total Generation Capacity: 922 GW Gross, 859 GW Adjusted Net

OCGTOld gasblock

CCGT

Other renewables

Pumpedstorage

Other

Wind

Oil

GasLignite

Hard Coal

Nuclear

Hydro

143

146

199

65

190

70

83

26

150

174109

65

190

40

133

134

65

72100

26

37

Grossinstalledcapacity

Adjusted netgenerationcapacity*)

922 GW859 GW

> In 2010, more than 13 GW of CCGTs are scheduled to go online.


Capacity Trends in 50 Years of Thermal Power Generation in Europe: Gas on the Rise since 1993

Annual commissionings of thermal power generation capacities in the EU-27 in GW*)

*) Adjusted net generation capacity. Sources: Platts Database, Worldwatch Institute, RWE, 2010.

GW

>

GW

> >

GW

>

GW

>

Oil (46 GW) Gas (159 GW)

Year of commissioning Year of commissioning

Lignite (51 GW)

Year of commissioning

Hard coal (118 GW)


Nuclear (133 GW)


GW

Electricity – GenerationMarket DataPolitical Framework ConditionsAt a Glance RWE

0 5 10 152010

2000

1990

1980

1970

1960

0 5 10 152010

2000

1990

1980

1970

1960

0 5 10 152010

2000

1990

1980

1970

1960

0 5 10 152010

2000

1990

1980

1970

1960

0 5 10 152010

2000

1990

1980

1970

1960


German Energy and Power Mix (2009)

Primary energy consumption:455 million tons of coal equivalent

Gross power generation: 597 TWh (preliminary)

Natural gas 22%

Other 36%

Renewables 9%

Lignite 11%

Nuclear 11%

Hard coal 11%

Natural gas 13%

Nuclear 23%

Renewables 16%

Lignite 24%

Hard coal 18%

Other (incl.pumped storage 6%

Source: Arbeitsgemeinschaft Energiebilanzen (Energy Balance Working Group), BDEW, February/March 2010.



UCTE Methodology for Evaluating the Generation Capacity Remaining in EuropeInstalled national generating capacity+ Hydro power stations+ Nuclear power stations+ Fossil power stations+ Renewable energy sources (other than hydro)+ Not clearly identifiable energy sources

= National generating capacity- Unusable capacity

– Of which mothballed capacity- Outages and overhauls (fossil fuel power stations)

= Reliable available capacity- Load

= Remaining capacity

5% to 10%

Source: UCTE.


Minimum criteria: The capacity remaining in any given country should be at least 5% or 10% of the national generating capacity.


010203040506070

0 1 2 3 4 5 6 7 8 9 10 11 12

0

10

20

30

40

50

Current status of new build projects (Germany)

Source: RWE, February 2010.

Ramp-up capability of power plant portfolio in GW per hour

Max. load swing in GW within 12 hours

base load

+

+

+

+

+

+

Flexibility of generation system (Germany)

Load swing from

demand and

renewables

Source: RWE, December 2009.

GW

> Rising share of renewables generation will lead to:– Increase of load swings in the system– Price spikes and negative prices due to lack of flexibility in

current power plant portfolio– Shut downs of old inefficient and inflexible power plants

> The efficiency gap is amplified by increasing number of cancellations and delays of new-build projects– Eight large power plant projects with a combined capacity of

8.6 GW cancelled in the last 12 months– Local public opposition and quality problems cause delays in

projects under construction

+

Cap

acity

(GW

)

Most likelyUnder construction

Cancelled/stopped

QuestionableUnlikely


Growing Number of Cancellations Increases Efficiency Gap and Value of RWE’s New-build Projects


Attractiveness of Coal and Gas Differs in Germany and the UK

1) Including renewables and CHP.2) Oil, OCGT, hydro, etc.

German power price UK power price

> Large proportion of low marginal cost plant from nuclear, lignite, CHP and wind.

> Load factor for new coal plant somewhat higher in Germany than in the UK.

> Higher share of high marginal cost plant.> New gas plant in UK has significantly higher load factor than in

Germany.

0 10 20 30 40 50 60 70 80 90 100

Proportion of installed capacity (in %)

Mustrun1)

Hard coal

OC

GT

+C

CG

T

LigniteNuclear

Peak

ing2)

Newlignite

Newhard coal

NewCCGT

Hourly DemandMin. Max.

Pow

er p

rice

0 10 20 30 40 50 60 70 80 90 100

Proportion of installed capacity (in %)

Inter-connector

+Must run1)

Hardcoal

CCGTNuclear

Peak

ing2)

Newhard coal

NewCCGT

Hourly demandMin. Max.

Pow

er p

rice

Summergas prices



0

0,5

1

1,5

Lignite Hard coal Natural gas

Power Generation in Germany: CO2 Emissions per Plant Type1)

Kg/kWh

CO2 emissions from new plant technology (BoA)2):0.95 kg CO2/kWh

1) Unweighted factor per fuel-specific installed capacity.2) Lignite-optimised plant.

1.14

0.92

0.44


1.50

1.00

0.50

0


World average

EU average

State of the art technology

Steam power plant700°C technology

But:Efficiencylosses of

7- 12% points

2010 2020

About 50%

669 g CO2/kWh

288 g coal/kWh

30%

1,116 g CO2/kWh

480 g coal/kWh 38%

881 g CO2/kWh

379 g coal/kWh 45%

743 g CO2/kWh

320 g coal/kWh

… %

… g CO2/kWh

… g coal/kWh

CCStechnology2)

CO2 Reduction Potential of Coal-fired Power Plants1)

by Increased Efficiency

CO2 emissions per kWh

1) Average data for hard coal-fired power plants.2) CCS: Carbon Capture and Storage.

Source: VGB Tech, Electricity Generation Facts & Figures 2009/10, September 2009.

Efficiency1)

CO2 emission

Use of fuel


CO2 reduction

- 21%

- 90%

- 40%

- 33%

Time


0.00.0

125.1114.9

110.3100.2

88.287.4

86.663.3

54.247.3

18.514.013.4

11.07.8

6.31.0

0 25 50 75 100 125 150

Neckarwestheim 2Emsland

Isar 2Brokdorf

KrümmelGrohnde

Philippsburg 2Gundremmingen CGundremmingen B

GrafenrheinfeldUnterweser

Biblis B Philippsburg 1

BrunsbüttelBiblis A

Isar 1Neckarwestheim 1

ObrigheimStade

Residual Electricity Volumes of Nuclear Power Plants


Note: RWE has a total allotment of 107.25 TWh from Mülheim-Kärlich. Source: www.bfs.de/en/kerntechnik/strommengen.html.

1) Expected remaining lifetime at least until September 2010 and until June 18, 2011 with the additional 4.8 TWh generation quota from EON’s Stade nuclear plant.2) Transfer of 21.45 TWh from Mülheim-Kärlich to Biblis B (possible without governmental permission; possible lifetime extension until Jan. 2014).

On June 28, 2010, RWE Power transferred 8.1 TWh out of this quota to Biblis B. Including the 8.1 TWh the lifetime could last until January 2012.

Residual electricity volumes as of June 30, 2010 in TWh net

2)

1)


Nuclear Power Plants in Germany: Remaining Capacities after Shut-Down

5,44404/18/20191,34615Vattenfall: 50% / E.ON: 50%Krümmel

17,62206/19/20118785E.ONIsar 1

005/11/20231,30519EnBW: 99.8% / Deutsche Bahn: 0.2%Neckarwestheim 21,30502/07/20221,32918RWE: 87.5% / E.ON: 12.5% Emsland2)

2,63401/26/20211,40017E.ON: 75% / SW München: 25% Isar 24,03401/12/20201,41016E.ON: 80% / Vattenfall: 20% Brokdorf

6,79002/13/20191,36014E.ON: 83.3% / SW Bielefeld: 16.7% Grohnde8,15011/04/20181,39213EnBW: 99.8% / Deutsche Bahn: 0.2%Philippsburg 29,54202/04/20171,28812RWE: 75% / E.ON: 25% Gundremmingen C2)

10,83002/27/20161,28411RWE: 75% / E.ON: 25% Gundremmingen B2)

12,11406/24/20151,27510E.ONGrafenrheinfeld 13,38907/07/20128909EnBW: 99.8% / Deutsche Bahn: 0.2%Philippsburg 114,27905/30/20127718Vattenfall: 66.7% / E.ON: 33.3%Brunsbüttel15,05005/04/20121,3457E.OnUnterweser16,39501/10/20121)1,2276RWEBiblis B2)

18,55006/18/20111)1,1674RWEBiblis A19,66709/04/20107853EnBW: 99.8% / Deutsche Bahn: 0.2%Neckarwestheim 120,45705/11/20053402EnBW: 99.8% / Deutsche Bahn: 0.2%Obrigheim20,75711/14/20036401E.ON: 66.7% / Vattenfall 33.3%Stade21,397

RemainingGerman capacity

after shutdown

Date of shutdown

(load factor: 85%)

Capacity per power plant

MW

Phase-outsequence

OwnerPower plant

1) Separate estimation for Biblis A and B according to actual schedule. Regarding Biblis A, the generation quota (4.8 TWh) from E.ON‘s Stade nuclear plant isincluded.

2) Lifetime of these RWE plants can be further extended by transferring parts of the Mülheim-Kärlich contingent of 107.25 TWh in total. For Biblis B, thisallocation is capped at 21.45 TWh. On June 28, 2010, RWE Power has transferred 8.1 TWh of this quota to Biblis B. Including the 8.1 TWh the lifetime of Biblis B could last until January 2012.


As of June 30, 2010.


The Merit Order and Aspects Influencing its Structure Provide aBetter Tool for Looking at the Dynamics of Power Plant Portfolios

The German merit order –the marginal power plant principle

> Due to low price elasticity of demand, prices in electricity markets are driven by the merit order structure

> The operation of power plants follows the sequence of short-run marginal costs: the merit order

> Margins depend primarily on the cost efficiency of the availablesupply, not on adequacy (marginal plant mechanism)

Nuclear LigniteHardcoal Gas Oil

Varia

ble

cost

s in

€/M

Wh

Supplied capacityin MW

Market price

Capacity in demand (marginal plant)

Min. Max.


Due to the significant time requirement for planning, permitting and constructing new generation capacity, as long as there are no systematic shifts in commodity price relations (e.g. hard coal vs. gas), merit order forecasts are valid for several years.


Change in German merit order dueto wind generation


Wind Generation Works More or Less Like Negative Demand

> Being treated as “negative demand”, must-run capacity (e.g. power generation from wind) changes the demand which has to be covered by conventional power plants

> This means, although must-run changes the resulting market price indirectly, it does not change the structure of the merit order

> In times of high must-run feed-in and low domestic demand the overall effect is partially compensated by exports

Varia

ble

cost

s in

€/M

Wh


DemandDemand- wind

Demand- wind+ exports

Market price

Offer price



Change in German merit order due to CO2

The CO2 Cap-and-trade System has Reduced the Gap in the Merit Order between Upper Base-load and Lower Peak-load Electricity

> Marginal costs for old lignite-fired power stations increased more than marginal costs for efficient hard coal plants

> Marginal costs for old hard coal-fired power stations rose more compared to those of efficient gas-fired power stations

> As this is a dynamic system with changing fuel price relations (e.g. gas vs. hard coal), it is difficult nevertheless to predict at which CO2 price level a switch between the fuel types in the merit order would happen

With CO2 Without CO2


Offer price

Varia

ble

cost

s in

€/M

Wh




Power Generation Capacity Remaining in Europe and Germany

Europe Germany

Total power plant capacity

- Unusable capacity

- Reserve capacity- Outages and overhauls*)

Reliable available capacity

- Load

*) Thermal power plants only.

Source: Union for the Coordination of Transmission of Electricity (UCTE).

660.5 134.7

= 466.3 = 93.5

Remaining capacity 104.9 25.3

Import balance 2.8 2.2


131.1

28.135.0

361.4

27.9 6.86.5

68.2

Status: December 2008GW


Balancing Power: How Does it Work?

Primary> Automatic control at the generator/turbine > E.g. thermal power plants

Secondary reserve> Automatic control by the TSO,

load frequency control> E.g. pumped storage

Frequency

5 s 30 s 15 min 1 h

5 s 30 s 15 min 1 h

Primary Secondary

Minute reserve Hour reserve

TSO1) BRP2)

Starting point – e.g. power station breakdownf

...

Minute reserve> Manual activation by TSO> Manual, e.g. thermal power plants

1) TSO: Transmission system operator.2) BRP: Balance-responsible party.



Main Sea Freight Trading Routes for Hard Coal in 2009 (I)

Seaborne hard coal trade in 2009: 859 million mt

API = All Publications Index

27

70

63

90

23

230

273

To theFar East

Canada/USA

INDONESIA

SOUTH AFRICA

CHINA

CANADA

USA

COLOMBIA/VENEZUELA

AUSTRALIA

API#2

API#4

API#3

RUSSIA

Source: Verein der Kohlenimporteure e.V. (German Coal Importers‘ Association), Annual Report 2008/2009, published in July 2010.

44

Electricity – FuelsMarket DataPolitical EnvironmentAt a Glance RWE


Main Sea Freight Trading Routes for Hard Coal (II)

API = All Publications IndexCIF = Cost, Insurance, FreightCIS = Commonwealth of Independant StatesFOB = Free On BoardThe TFS API was a registered trade mark of the Tradition Financial Services Company (TFS). The TFS ascertains different API prices by a price survey from Argus Media and McCloskey.

API Index was renamed from July 2005 on to AM API#... (A for Argus Media and M for McCloskey).Source: Verein der Kohlenimporteure e.V. (German Coal Importers‘ Association), Annual Report 2008/2009, published in July 2009.


The TFS API#3® is a weekly (every Friday) basket index price with a basis of 6,700 Kcal/kg, GAD (gross air dryed) FOB Newcastle (Australia) and published on a weekly and a monthly average basis. Calculation: (FOB Newcastle price + Barlow Jonker Index (BJI)) divided by 2

API#3

The TFS API#4® is a weekly (every Friday) basket index price with a basis of 6,000 Kcal/kg, NAR FOB Richards Bay (South Africa) and published on a weekly and a monthly average basis. Calculation: (FOB Richards Bay price ascertained by McCloskey + SACR Spot Coal Price Index + FOB Richards Bay price ascertained by Argus Media) divided by 3

API#4

The TFS API#2 is a monthly basket index for the ARA (harbours of Amsterdam, Rotterdam, Antwerp) coal price with a basis of 6,000 Kcal/kg, CIF, ARA, NAR (net as received) calculated on the last business day of the month. Calculation: (MCIS NWE steam coal marker price + international index) divided by 2

API#2

Major products traded on worldwide coal markets


Source: Nuclear Energy Outlook 2008 (OECD Nuclear Energy Agency).

Based on a constant annual consumption of about 70,000 metric tons (capacity currently installed in nuclear power plants)

50 100 150 200 250 300 700 > 1,000 years

Provenreserves

50210 400

Definitively probable reserves

50

Probable conventional resources

200

Uranium from phosphates & sea water

Conventional uranium production Non-conventional uranium production

Improved uranium use through fast neutron

systems

Result of exploration activity from 1950 to 1970. Significant new uranium

exploration only since 2005

> 21,000


Reach of Uranium Reserves (I)


Reach of Uranium Reserves (II)

> The amount of uranium that can be produced and the reach of the reserves depend on the effort required, especially in terms of production techniques and production costs

> Most of the deposits are in regions that are politically stable such as Australia (22.5%), Canada (8.4%) and America. Major reserves have also been developed and are being mined in Kazakhstan (13.7%), South Africa (8.2%), Niger (5.8%), Namibia (5.1%), Ukraine (3.8%) and Uzbekistan (2.1%)

> Today’s known and probable reserves are the result of exploration activity conducted from 1950 to 1970. Given the sufficient levels ofsupply and low uranium prices, major uranium exploration was not carried out until 2005

> Similar to other raw materials such as oil, gas and coal, the level of known uranium reserves depends on the phases the exploration cycles are going through

> Uranium exploration is currently going through the beginning of the second exploration cycle. Other raw materials already have more than five cycles behind them

> Since uranium only accounts for a small portion of total electricity generation costs, rises in the price of uranium only have a minor effect on them



Major European Electricity Exchanges

NordPool Oslo

European Energy Exchange (EEX), Leipzig

APX Power NL, Amsterdam

APX Power UK, London

Powernext, Paris

Belpex, Brussels

Omel, Madrid

Energy Exchange Austria (EXAA), Graz

UK

SPAIN

FRANCE

NORWAY

AUSTRIA

NETHER-LANDS

GERMANY

SWEDEN

FINLAND

DENMARK

BELGIUM

Electricity – TradingMarket DataPolitical EnvironmentAt a Glance RWE


0

1000

2000

3000

4000

5000

6000

7000

8000

2001 2002 2003 2004 2005 2006 2007 2008 2009

Power Trading Volumes in Continental Europe 2001 – 2009

TWh*)

ScandinaviaNetherlands OTCNetherlandsFrance OTCFranceGermany OTCGermany

*) Measurable power trading volumes at exchanges and brokering platforms (OTC).

Electricity – TradingMarket DataPolitical EnvironmentAt a Glance RWE

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000


ES

FR

PT IT

BE

NL

CHAT

PL

CZ

SK

SIHR

RS

MK

BA

AL

GR

UA

BG

RO

DE

L

GB

IE

DZ TNMA

TR

LT

BY

MD

LV

RU

UA

DK

SENO EE RU

DK

UCTE North, synchronous grid

HU

FI

DC link

Baltic

Nordel

UCTE South, synchronous grid

GB

Ireland

Non-participating countries

UCTE, asynchronous

Electricity – GridMarket DataPolitical EnvironmentAt a Glance RWE

The European ENTSO-E*) Power Transmission Grid

*) ENTSO = European Network of Transmission System Operators for Electricity.


Germany's Transmission System Operators (2009)


13193038Load share [%]

1,9366,7005,4005,200System size [km] (380 kV)

1,7212,8655,3006,100System size [km] (220 kV)

7685138175Annual transmission [TWh]

34,600 109,000139,40073,100Area covered [km²]*)

EnBW50 HertzTranspowerAmprion

Amprion

50HertzTransmission

EnBW

Transpower

*) In Germany.


Germany: Import and Export of Electricity (2009)

Source: Amprion.

TWh SWEDEN0.97

DENMARK6.05

3.65 1.19

POLAND

1.930.39

7.94

CZECHREPUBLIC

6.06

AUSTRIA

2.99SWITZERLAND

0.14

8.454.82

FRANCE1.69

13.67LUXEMBOURG

BELGIUM

2.986.34

GERMANY

∑ Import 30.61∑ Export 38.65

NETHERLANDS



Transfer Capacity1) in Europe from and to Germany (Winter 2009/2010)

MW> Transmission capacity between Germany and

its neighbouring countries is small comparedto capacity installed in Germany.

> Wholesale markets in Germany, Austria and Switzerland are gradually converging; due to its size, Germany is the dominant sub-market.

1) Transfer capacities should be consideredseparately and are not cumulative.

2) Depending on wind situation in Germany.

Source: www.entsoe.euNTC-Matrix Winter 2009-2010.

DENMARK EAST550

SWEDEN610WEST2)

1,500

NETHERLANDS

3,000 3,850

GERMANY

POLAND2)950 550 600

1,1001,200

2,300

CZECHREPUBLIC2)

2,200

AUSTRIA

2,200

3,200

1,500

3,050

2,800

FRANCE

800

SWITZERLAND



The Largest Electricity Companies in Europe (2009)

Consolidated electricity sales volumeBn kWh1)

1) Last completed fiscal year in each case. Net figures, excluding proprietary trading.

2) Electricity production.

Source: RWE, May 2010.

119,7

194,6

204,8

253,1

282,8

287,7

618,5

815,9

0 100 200 300 400 500 600 700 800

EnBW (GER)

Vattenfall (SWE)

Iberdrola

GDF (FRA)

RWE (GER)

ENEL (ITA)

EdF (FRA)

E.ON (GER)

Electricity – SupplyMarket DataPolitical EnvironmentAt a Glance RWE

2 )


Development of Energy Consumption in Germany

Development by segment

8.78.78.58.38.38.3

228.1252.4255.3253.7249.7248.5

16.016.516.416.316.216.2

118.5 118.7 119.8 120.8 121.3119.8

139.2139.5140,2141.5141.3140.4

0

100

200

300

400

500

600

2004 2005 2006 2007 2008 2009

ElectricityTWh

Residential customers TransportServices Industry

Agriculture

Gas TWh

Residential and commercial customers*Industry Power plants

Source: Bundesverband der Energie- und Wasserwirtschaft e.V.(German Energy and Water Association), 2010.

83 104 104 126 112

400 408 410 386 369 328

479 468 459 438 437448

1150

200

400

600

800

1000

1200

2004 2005 2006 2007 2008 2009

531.9 534.2 539.6

962 980 973

Source: Bundesverband der Energie- und Wasserwirtschaft e.V.(German Energy and Water Association), 2010.

1,200

1,000

541.2

*) Also includes transport and district heating.

538.4

888


511.8940 932


6.396.456.56

6.836.89

7.908.28

8.939.04

9.339.44

9.6210.1210.26

11.1010.72

11.1111.2011.2211.34

11.5811.75

12.9112.97

13.7314.03

0 2 4 6 8 10 12 14 16

BulgariaEstoniaFranceFinland

SwedenLithuaniaRomania

LatviaCroatiaPoland

PortugalSlovenia

Great BritainEU-27

AustriaNetherlands

BelgiumSpain

Czech RepublicGermany

LuxembourgIrelandMalta

HungaryItaly

Slovakia

Electricity Prices in Europe (for Industrial Customers)

Average electricity prices for industrial customers*) in the second half of 2009 in selected European countries €ct/kWh

*) Basis: industrial customers with a consumption of 500 – 2,000 MWh; prices excluding value-added tax and all other recoverable taxes and levies. Source: Eurostat, April 2010.



8.18

10.32

12.25

12.89

14.07

15.94

16.45

16.46

16.84

18.50

18.55

18.82

19.09

19.97

22.94

25.53

0 5 10 15 20 25 30

Bulgaria

Greece

France

Finland

UK

Portugal

EU-27

Sweden

Spain

Netherlands

Ireland

Luxembourg

Austria

Italy

Germany

Denmark

Pan-European Comparison of the Household Electricity Prices

Ct/kWh

Source: Eurostat, May 2010, rounding differences may occur.

Ø EU-27

Electricity prices including all taxes and levies; second half of 2009.



4.8

8.7

11.9

12.2

13.2

16.3

18.0

24.9

24.7

24.9

27.7

35.7

40.8

56.1

0 5 10 15 20 25 30 35 40 45 50 55 60

UK

Greece

Ireland

Luxembourg

Portugal

Bulgaria

Spain

The Netherlands

France

Finland

Austria

Sweden

Germany

Denmark

German Households Rank Second in Terms of State-Caused Charges on theElectricity Bills

Source: Eurostat, 2nd half of 2009 (average); prices incl. taxes, levies and fees, annual consumption of 2,500 – 5,000 kWh, Bundesverband der Energie- und Wasserwirtschaft e.V., (German Energy and Water Association), June 2010.


%


Competition Has Been a Reality since 1999: Freedom of Choice for German Residential Electricity Customers; Increasing Churn Rates

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), June 2010.


Churn rate of electricity customers (accumulated)

2.73.1

4.3

7.4

8.3 8.5

1

2

3

4

5

6

7

8

9

Nov. 2005 Nov. 2006 Nov. 2007 Dec. 2008 Oct. 2009 June 2010

Million

7% 8%11%

18.9%20.7%

21.4%


6.356.356.266.356.276.466.53 6.605.104.323.36

1.82

2.002.05

2.042.08

2.15 2.22 2.07 2.09 2.14 2.17 2.16 2.11

8.204.804.884.303.732.922.301.91

1.631.15

0.90

0.26

0.990.67

0.76 0.77 0.85 0.79 0.70 0.52 0.63

0.45

0.61

0

2

4

6

8

10

12

14

16

18

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

German Electricity Consumption Fees

State-caused charges for all electricity customers€ billion (excluding value-added tax)

Concession fees (estimated)

Electricity tax3)

Kraft-Wärme-Kopplungsgesetz (German Combined Heat and Power Act)1)

Erneuerbare-Energien-Gesetz (German Renewable Energy Act)2)

1) Old Combined Heat and Power Act of May 2000 replaced by new Combined Heat and Power Act in April 2002.2) Previously Stromeinspeisegesetz (German Electricity Feed-In Act), since April 2000: German Renewable Energy Act.3) According to estimates of the German Tax Estimation Task Force.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), January 2010.

12.8812.3011.8911.35

9.488.50

6.92

2)

13.49 13.83 13.94

Electricity – SupplyMarket DataPolitical Framework ConditionsAt a Glance RWE

17.11

+ 319%

4.08


92%98%121%

99%102%85%

74%61%69%

57%57%

92%98%

31%24%

20%

22%20%

22%22%

24%13%13%10%

4%2%

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Industrial Customers Pay Higher Governmental Charges, but Net Electricity Prices are 6% below the Level of 1998

Taxes, levies & fees Renewable Energy Act, Combined Heat and Power Act, electricity tax.Net electricity pricesGeneration, transmission and sales.

1) Medium voltage, purchase of 500 kW/3,150 h.2) Until April 2010.Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), April 2010.

Development of average industrial1) electricity prices (including electricity tax)1998 = 100%

+ 23%

+ 1,450%

- 6%

67

123

7073 85

96107

122 121

Change (1998 = 100%)141


122

2)

10096

In 2000, industry benefited from liberalisation in the tune of some €5.6 billion.In 2010, net industrial electricity prices are 6% below the level of 1998.


40,53

28,57

41.5337.9535.5534.2732.7331.5629.8428.3225.0825.1533.8037.60

26.1725.20

24.6522.4921.7020.8220.3018.6716.6815.51

14.4012.35

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Government Inflates German Electricity Bills

Average monthly electricity bill of a three-person household (3,500 kWh/a)€/month

Taxes, levies & feesRenewable Energy Act, Combined Heat and Power Act, concession fees, electricity tax and value-added tax.

Net electricity pricesGeneration, transmission, distribution, metering, sales and marketing.

49.95 48.20

40.66 41.7646.99 50.14

52.38 54.43 56.7660.20

Change (1998 = 100%)

+ 38%

+ 131%

+ 8%

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), April 2010.

63.15


67.70

Gains resulting from deregulation are being eroded by additional burdens imposed by policymakers.

69.10


Government Charges Account for 41% of German Household Electricity Bills1)

23.69 ct/kWh break down as follows (as of April 2010):

Wholesale price/network usage fees/sales:13.89 ct/kWh

Network usagefee/metering/

energy data 5.80 24.5 % management

Wholesale7.19 30.4% price

Sales and0.90 3.8% marketing

1) 3,500 kWh/a.2) VAT at 19%.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), April 2010.Rounding differences may occur.

State:9.80 ct/kWh

Value-added tax2) 3.78 16.0%

Electricity tax 2.05 8.7%

Concession fee 1.79 7.6%

RenewableEnergy Act 2.05 8.7%

Combined Heatand Power Act 0.13 0.5%

41%



Blackouts in Europe in Minutes (2008)

103.8102.5

89.4

57.752.5

43.7

18.3

0

20

40

60

80

100

120

Germany Austria Hungary France UK Portugal Spain

Source: Verband der Elektro- und Informationstechnik (German Electrical Engineering and Information Technology Association), February 2010.

Minutes



The Largest Electricity Companies in Germany in Terms of Sales to End Customers (2008) Billion kWh*)

*) Including consolidated participations.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), March 2010.

4.4

6.9

7.9

8.1

10.9

11.6

24.2

78.1

81.6

85.9

0 10 20 30 40 50 60 70 80 90 100

Stadtwerke Hannover AG, Hanover

N-ERGIE AG, Nuremberg

Stadtwerke München GmbH, Munich

RheinEnergie AG, Cologne

EWE AG, Oldenburg

MVV Energie AG, Mannheim

Vattenfall Europe AG, Berlin

E.ON AG, Düsseldorf

EnBW AG, Karlsruhe

RWE AG, Essen



Gas Markets Develop and are Getting Global –Flexibility Becomes Key Success Factor

> Gas supply and pricing structures change> International LNG further growing: Linking

European, American and Asian gas markets> Liquidity of European gas markets rising with

gas prices increasingly volatile> Shift of key success factor: From "volume

creates value" to "flexibility creates value“

Source: BG Group; RWE

Gas – LNG Market DataPolitical EnvironmentAt a Glance RWE


The New Global Gas “Gearbox” – Mainly Driven by LNG

Crystallisation of pre-FID LNG projectsCrystallisation of pre-FID LNG projects

China & India demand elasticityChina & India demand elasticity

Qatar's sales strategy & tacticsQatar's sales strategy & tactics

Major pipe exporters sales strategy & tacticsMajor pipe exporters sales strategy & tactics

Pace of global economic recoveryPace of global economic recovery

Pricing support from coal displacementPricing support from coal displacement

Global LNG outagesGlobal LNG outages

Pace of production curtailmentPace of production curtailment

Gas – LNG Market DataPolitical EnvironmentAt a Glance RWE

Source: Wood Mackenzie Global Gas Service.


LNG is Becoming an Increasingly Important Component of Global Gas Supply

Global natural gas demand and LNG's share Bcm

Source: CERA.

7%13% 15% 17%

2003 2010 2015 2020

2,000

3,000

4,000

1,000

Asia PacificAfricaMiddle East

South and Central AmericaNorth AmericaGlobal LNG

Europe and Eurasia

Gas – LNGMarket DataPolitical EnvironmentAt a Glance RWE


How the Liquefied Natural Gas (LNG) Value Chain Works

Gasfield

Pipeline

Liquefaction

Storage

Shipping

Storage

Regasification

Pipeline

Vessel transport volume (standard range):135 – 155 thousand m3 LNG ≈ 81 – 93 million m3 regasified volume≈ 495 – 565 thousand boe≈ 0.9 – 1.0 TWh

Transport system

Liquefaction plantGas: ∼ 600 m3 at 15 °C

LNG: 1 m3 at -162 °C

Power generation

Regasification terminalGas: ∼ 600 m3 at 15 °C

LNG: 1 m3 at -162 °C

Gas – LNGMarket DataPolitical EnvironmentAt a Glance RWE Gas – LNGMarket DataPolitical EnvironmentAt a Glance RWE


Shipments of Liquefied Natural Gas (LNG) to Europe in 2009

Billion cubic metres/year

Europe's import of LNG is on an upward trend because> indigenous gas production is dropping> a more diversified portfolio of gas supply is desired> new regasification infrastructure is being built

0.08United Arababian Emirates

1.970.040.720.164.180.08Trinidad & Tobago

0.09Yemen

0.08Australia

0.090.08Equatorial Guinea

0.08Belgium

0.440.171.38Norway

9.992.422.990.7413.076.5327.015.70Total

5.751.550.176.034.980.32Qatar

1.300.08Oman

2.142.350.084.990.94Nigeria

0.72Libya

0.510.171.630.094.100.08Egypt

1.680.111.270.537.685.194.20Algeria

UKPortugalItalyGreeceFranceBelgiumSpainTurkeyToFrom


Source: BP Statistical review, June 2010.


Present Liquefied Natural Gas (LNG) Production Capacity (2009) (I)

Million metric tons/year

4.00Gassi Touil12.30Arzew

23.8Algeria

29.7Nigeria8.4021.30NLNG

4.003.50Skikda

9.60Sakhalin9.6Russia

5.00PLNG5.0Peru

1.50Kenai1.5USA

23.20MLNG23.2Malaysia

9.70Tangguh16.70Bontang1.40Arun LNG

27.8Indonesia7.20Brunei LNG

7.2Brunei4.30Pluto LNG

3.50Darwin LNG15.90North West Shelf

23.7Australia

TotalCapacity underconstruction

Existing capacity

Source: Pira, 2009.



Present Liquefied Natural Gas (LNG) Production Capacity (2009) (II)

Million metric tons/year

5.00Luanda5.0Angola

6.00Adgas

7.8028.50RasGas

6.0Abu Dhabi

23.4017.80QatarGas77.5Qatar

3.60Qalhat7.10Oman LNG

10.7Oman7.00Yemen LNG

7.0Yemen4.20Snøhvit

4.2Norway3.70EGLNG

3.7Equatorial Guinea14.90Atlantic LNG

14.9Trinidad and Tobago2.200.60Marsa el-Brega

2.8Libya5.005.00SEGAS

7.20ELNG17.2Egypt

TotalCapacity underconstruction

Existing capacity


Source: Pira, 2009.


Europe's Largest Gas Companies1) (2009)

Gas sales volume2)

Billion m3

1) No information available on Centrica.2) Standard factor: 1 TWh = 0.093 billion m3.

Source: RWE market analysis based on annual reports.

26.6

30.9

36.1

82.4

103.7

111.28

113.2

0 20 40 60 80 100 120

Gas Natural (ESP)

RWE (GER)

Wintershall (GER)

Gasterra (NED)

ENI (ITA)

GdF (FRA)

E.ON (GER)

Gas – DownstreamMarket DataPolitical EnvironmentAt a Glance RWE


01

23

45

67

89

1011

1213

14

DEN SWE AUT NED CZE ESP POL GER ITA BEL FRA UK

German Residential Gas Prices Compared with Other European Countries

All-gas household: annual consumption: 5,560 – 55,560 kWh*)

€ct/kWh (incl. taxes)

*) Cooking, hot water and heating.

Source: Eurostat 2010; average prices for 2009; based on 2008 purchasing power standards.

Average gas price

6.10


5.96.7

7.9

5.8 6.3 6.37.1

6.2

4.2

5.15.0

6.9


0

1

2

3

4

5

6

7

8

9

10

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

German Residential Gas Prices from 1999 to 2009 Compared with OtherEuropean CountriesAll-gas household: annual consumption: 23,500 kWh*)

€ct/kWh (incl. taxes)

Belgium

Austria

Germany

Italy

*) Cooking, hot water and heating; 5,560 – 55,560 kWh after second half of 2007.

Source: Eurostat, 2010.

Spain

France

Netherlands

United Kingdom



Government Charges Included in the German Gas Price

*) Example based on the average price per kWh for an all-gas household (as of beginning of 2010) with a consumption of 20,000 kWh.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), 2010.

Import/production,transportation, storage and distribution 70%

Prorated production levy 3%

Value-added tax 16%

Gas tax 9%

Concession fee 2%


30% of the gas price*) payable by an all-gas household is allocable to taxes and levies(gas tax, concession fee, production levy and value added tax)


Grid Access in the German Gas Market

> Grid access was modified and simplifiedas of October 1, 2008.

> Cooperation agreement signed by RWE to activelypromote competition.

> There are 6 market areas in Germany, each of whichhas a virtual trading point (VTP).

> This enables unlimited access within each market area.

Source: RWE.

Source of gas/Point of import

Two-

cont

ract

mod

el

Entry contract

Exit contract

Long-distance gridoperator

VTP

End consumer

MARKET SECTOR

MARKET SECTOR

Grid connection point

Grid connection point

Regional gridoperator

Local grid operator

VTP = Virtual trading point, where trading activities can be transactedVTP



Natural Gas Supplies in Germany (2009)

Total volume: 1,058 TWh*)

Russia 339 TWh 32%

Norway 307 TWh 29%

Netherlands 212 TWh 20%

National 138 TWh 13%

Denmark/United Kingdom, others 63 TWh 6%

*) Preliminary figure.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), March 2010.



Gas trading pointTransport route


Bacton

DENMARK

Zelsate

Oude

Frankfurt an der Oder

CZECHREPUBLIC

Balgzand

Vesterled

Lang

eled

Fran

pipe

Zeep

ipe

Norpipe

Eur

opip

e 1+

2

Ellund

DE

UD

AN

BBL NETRA

IUK

Blaregnies

Dunkirk

GERMANY(EGT/BEB/WG/RWE/ONTRAS)WEDALRTR

TENP

FRANCE(PEG)

Obergailbach

St. Katherina

WAGOberkappel

TAG

AUSTRIATarvisio

Wallbach

Griesspass

Baumgarten(CEGH)

UNITED KINGDOM

(NBP)

MEGAL

Waldhaus

BocholtzS‘Gravenvoeren

LUXEMBOURG

BELGIUMAachen

Emden

NETHERLANDS(TTF)Zeebrugge

SWITZERLAND

European Gas Trading Points


Relevant Institutions and Their Role in Regulating the Czech Gas Market


The State Energy Inspection Authority is authorised to assess buyer and seller behaviour and recommend sanctions to ERO.

Market regulation is monitored by 4 institutions: > Energy Regulatory Office (ERO)> Office for the Protection of Competition (UOHS)> State Energy Inspection Authority> Ministry of Industry and Trade

ERO is an autonomous authority, which is responsible for the regulation of the Czech energy marketMost importantly, ERO handles the granting of licenses and the regulation of TPA tariffs for networks and is responsiblefor the control of gas supply prices

UOHS is the central state administration authority responsible for establishing conditions that promote and safeguard competition, supervising public procurement as well as acting as advisor and monitor for the provision of state aid

The Ministry of Industry and Trade is responsible for approving new investment projects; it also refines energy policies and passes basic legislation (Energy Act and related explanatory decrees)

1

2

3

4

5


Status of Czech Gas Market Liberalisation and Regulation


At the same time, a new market model was introduced. It consists of a virtual trading point, an entry-exit system and the possibility of gas sales beyond the distribution system operators’ (DSOs) balancing zones. In order to control the constitution of the market, legal restrictions are set as a framework in which, for example, the principal of non-discriminatory supply conditions for non-consolidated regional gas companies (RGCs), including other market participants, is monitored.

> The opening of the Czech market began in 2005 > Since January 1, 2006, all end customers have been eligible, with the exception of residential customers > On January 1, 2007, all customers including residential customers became eligible and the process of market opening was

completed

Full market liberalisation and complete market opening was achieved and competitors started to enter the market

The transmission system operator RWE Transgas Net, s.r.o. (renamed Net4Gas in March 2010) was set up as an entity that is legally independent from RWE Transgas, a.s. which holds the gas trading license. However, ownership however was retained by RWE. On January 1, 2007, regional gas companies (RGCs) were separated from the regional gas distribution system operators (DSOs).

Net4Gas is subject to the following restrictions due to its dominant position in the Czech gas market: > The commodity price (i.e. gas price): This price is being monitored by ERO.

RWE Transgas has to offer non-discriminatory prices to the same customer segment.> Transportation and distribution price: This price is regulated and has to be approved by the ERO.

The calculation is made on a “cost plus” basis and the costs have to be justified in detail.> Storage prices: Storage prices are not regulated, but are set in multi-round online auctions organised by SSOs.

1

2

3

4

5


Czech Gas Market: Gas-Price Setting Mechanism

> External factors influence approx. 70 – 80% of the final price of natural gas

*) Negotiated third-party access.

RWE Transgasregional gascompanies

4 – 8%

Supervisedby ERO

Gross trademargin

Entity

Portion of final price

Price composition

The ”value chain” Commodity Storage Distribution Transmission

Typical pricestructure

linked to otherfuels (oil, coal)

NTPA*), prices are set in auctions

Regulated Regulated

70 – 80% 4 – 8% 15 – 20% 3 – 5%

Foreignproducers(Russia, Norway)

RWE Gas storage

Distribution system

operators

RWE Transgas Net



Costs: ”Inflation - X” escalation (inflation is composed of the Consumer Price Index (CPI) with 1% premium and indexof selected B2B services). Incentives stem from outperfomance potential over the X-factor set by ERO.

Depreciation: Planned book values with ex-post correction to actual values.

Regulated asset base: The ERO defines the value, which forms the initial basis. Annual planned net investments are added to the basis. Ex-post corrections reflect actual net investments (DSO).

Unbundling: There are some residual allowed costs from previous regulatory periods related to the unbundling of system operators from vertically integrated companies.

Revaluation: For regulatory purposes, the ERO currently acknowledges the restated depreciation of revalued assets (according to Czech accounting standards). However, the revaluation effected assets only to a minor extent.

Escalation of Costs, Depreciation and Regulated Asset Base


Czech Gas Market: Basics of the Regulatory Framework


RWE


Market DataPolitical EnvironmentAt a Glance RWE

137 Electricity179 Gas205 Accounting207 Investor Relations


RWE's Emissions Profile in 2009 164RWE's Rhenish Lignite Mining Region 163RWE Lignite Production in the Rhenish Mining Region 162Lignite-Fired Power Generation: Higher Efficiency, Less CO2 (II) 161Lignite-Fired Power Generation: Higher Efficiency, Less CO2 (I) 160

RWE Shares of the European Power Generation Market by Region (2009) 138RWE Generation: No. 5 in Europe 137

RWE's Share of the German Power Generation Market Relative to Peers (2009) 139

RWE Group Generation Output and Capacity by Load Factor (2009) 143RWE's Germany Division's Power Plant Portfolio 2009 (I) 144RWE's Germany Division's Power Plant Portfolio 2009 (II) 145

RWE's Netherlands/Belgium Division's Power Plant Portfolio 2009 (II) 149RWE's Netherlands/Belgium Division's Power Plant Portfolio 2009 (I) 148

Fuels [166 – 168]

Age Structure of RWE's Power Plants in Germany in 2009 in MW RWE npower's Major Power Plants in the UK

RWE's Germany Division's Power Plant Portfolio 2009 (IV)

157158

147

RWE's Renewables Division's Power Plant Portfolio 2009 (IV)

RWE Group Electricity Production by Geographic Region (2009)

155

141

RWE's Use of Fuels in Proprietary Power Plants (II)

RWE's Hard Coal Purchases by Country of Origin in 2009

RWE's Renewables Division's Power Plant Portfolio 2009 (I)

RWE's UK Division's Power Plant Portfolio 2009

168

166

152

150

RWE Power's Major Power Plants in Germany

Electricity [137 – 178]RWE [137 – 207]

RWE's Use of Fuels in Proprietary Power Plants (I) 167

RWE Power's Nuclear Power Plant Decommissioning Concept165

Thermal Efficiency of RWE's German New Build Power Plants159

156

RWE's Renewables Division's Power Plant Portfolio 2009 (III) 154RWE's Renewables Division's Power Plant Portfolio 2009 (II) 153

RWE's Central and Eastern Europe Division's Plant Portfolio 2009 151

RWE's Germany Division's Power Plant Portfolio 2009 (III) 146

The Role of Electricity Purchase Agreements at RWE Power in Germany (2009) 142

RWE Group Electricity Production by Primary Fuel and Electricity Purchases (2009) 140

Generation [137 – 165]

Table of Contents


RWE Dea's Key Performance Indicators 186RWE Dea – Gas and Oil Production Target: Doubling of Annual Volume by 2015 185

RWE Electricity Sales by Customer Group (2009) (II) 177

Trading/Gas Midstream Division: Trading Volumes in 2009 170Centralised Pan-European Asset Management: Moving Assets Closer to the Market to Widen Margins 169

Trading [169 – 170]

RWE Supply & Trading: Full Integration of RWE Group's Midstream and Trading Activities 192RWE’s Gas Procurement Portfolio is Only Partly Exposed to the Gas-to-Oil Spread 193

Liquefied Natural Gas (LNG) will be of Growing Importance for RWE 189

Trading [192 – 194]

RWE: Making Use of Options is Key for our Gas Portfolio Management 194

RWE Dea – Reserves/Resources 2009 (P50) 182

Gas [179 − 204]

RWE's German Transmission Business (2009) 172

Network [171 – 172]RWE's German Electricity Network (2009) 171

LNG [189 – 191]

Upstream [179 – 188]

Supply [173 – 178]

RWE Dea: Defined Development Projects Secure Future Earnings Growth 179

RWE npower: Competing in the UK Retail Market 178

The Distinctive Features of Excelerate Vessels

RWE Dea's Asset Reserve Contribution (2009) (II)

RWE Electricity Customers by Region (2009)

190

184

174

Electricity [137 – 178]RWE [137 – 207]

RWE's LNG Value Chain with Excelerate191

Upstream Oil & Gas – Overview of RWE Dea's Activities 188Investment in International & Organic Growth: RWE Dea's Capex Plan per Region 187

RWE Dea's Asset Resource Contribution (2009) (I) 183

Classification of Reserves & Resources 181The Upstream Business Value Chain 180

RWE Electricity Sales by Customer Group (2009) (I) 176RWE Group Electricity Sales Volume by Geographic Region (2009) 175

RWE Shares in European Electricity Supply Markets (2009) 173

Table of Contents


RWE's German Gas Market Areas RWE Transgas Located in Strategically Important Part of European Transit Network RWE's Position in the European Gas Transit Business

Downstream [198 – 204]197196195

RWE AG Investor Relations – Contacts 207Investor Relations [207]

How the Size of the Provision is Determined 206Nuclear Provisions 205

Nuclear Provisions [205 – 206]Accounting [205 – 206]

Transport [195 – 197]

RWE Shares of the European Gas Downstream Market (2009) 198RWE Gas Customers by Region (2009) 199

Gas [179 − 204]RWE [137 – 207]

RWE's Regional Gas Companies: Nationwide Coverage in the Czech Republic 204Transmission and Storage System in the Czech Republic at a Glance 203RWE Group Gas Sales Volume by Geographic Region (2009) 202RWE Gas Sales by Customer Group (2009) (II) 201RWE Gas Sales by Customer Group (2009) (I) 200

Table of Contents


RWE Generation: No. 5 in Europe

EU-27 (2009): 3,200 TWh*)

Source: 2009 annual reports, RWE

EdF (incl. EnBW) 19%

Others*) 36%

Enel 8%

Vattenfall 5%

E.ON 9%

RWE 6%

GdF/Suez 9%

Market DataPolitical EnvironmentAt a GlanceElectricity – GenerationRWE

CEZ 2%

Iberdrola 4%

*) Estimated


RWE Shares of the European Power Generation Marketby Region (2009) % of inhouse-generation (excluding electricity purchased from third parties)

*) Including contracted generation.

Source: UCTE, National Grid, RWE.

25

7

15

2

0

10

20

30

40

Germany UK Central and EasternEurope

Netherlands/Belgium*)



RWE's Share of the German Power Generation Market1) Relative to Peers (2009)

*) Including contracted generation.

Source: H.-W. Schiffer, Energiemarkt Deutschland (German Energy Market), Cologne, 2010, (based on company information and on Geman Energy and Water Federation; RWE calculations).

RWE 147.5 TWh 26%*)

E.ON 111.4 TWh 20%

Vattenfall Europe 65.0 TWh 12%

EnBW 67.0 TWh 12%

Others 169.6 TWh 30%


Total net electricity production (including self generators): 560.5 TWh


RWE Group Electricity Production by Primary Fuel and Electricity Purchases(2009)

0

20

40

60

80

100

120

Lignite Hard coal Nuclear Gas Renewableenergies

Pumpedstorage, oil,

other

Electricitypurchases

Bn kWhTotal: 300.0*) bn kWh

RWE power plantsElectricity procured from power plants that are not owned by RWE that we can deploy at our discretion on the basis of long-term agreements

*) The difference between 300.0 bn kWh of power generation output and 282.8 bn kWh of electricity sales is due to grid losses and own use.

Lignite Hard coal Nuclear Gas Renewable energies

Pumped storage, oil,

other

Electricitypurchases

33.9 29.7

2.1

112.8

16.2

70.9

44.1

6.5



RWE Group Electricity Production by Geographic Region (2009)

Bn kWh

*) Net, excluding trading. Purchases for physical deliveries to customers only.

27.7

20.2

7.5

––

1.1–

0.1

0.7–

–

5.6

Other

6.51.5

0.8–

1.00.8

3.60.7

Renewable energiesthereof contracts

44.116.2

1.6–

10.7–

31.116.2

Hard coalthereof contracts

300.06.553.6212.2Total

112.82.025.964.7Electricity purchases*)

187.24.527.7147.5Subtotal

2.11.4

––

0.2–

1.91.4

Pumped storage, oil, otherthereof contracts

29.72.115.811.7Gas

33.9––33.9Nuclear

70.9––65.3Lignite

Total NL UK Germany



The Role of Electricity Purchase Agreements at RWE Power in Germany (2009)

Total capacity*): 32.4 GW Total generation: 143.6 TWh

Evonik (STEAG) 12%

RWE 73%

Others 8%

E.ON 7%

Others 4%

RWE 87%

Evonik (STEAG) 8%

E.ON 1%

*) As of December 31, 2009.

> RWE has full entrepreneurial control over power plants> Long-term contracts relating to fossil-fired and hydro power plants> RWE can use most outside purchases until the end of the power plant's useful life> Pricing is largely dependent on generation costs (fuel, CO2)



RWE Group Generation Output and Capacity by Load Factor (2009)

Output Capacity

Base load1) 86%

Peak load2) 14%

Base load3) 65%

Peak load4) 35%

1) Base in Germany: lignite, nuclear, coal (75%), gas (cogeneration), renewables (5%); base in the Netherlands/Belgium: coal (100%), renewables, gas (80%); base in the UK: coal (33%), gas base in CEE: lignite, renewables.

2) Peak in Germany: coal (25%), gas (condensation), renewables (95%), oil, pump storage;peak in the Netherlands/Belgium: gas (20%); peak in the UK: coal (67%), oil.

3) Base in Germany: lignite, nuclear, coal (50%), renewables, gas (cogeneration);base in the Netherlands/Belgium: coal (100%), renewables, gas (25%); base in the UK: coal (50%), gas;base in CEE: lignite, renewables.

4) Peak in Germany: coal (50%), gas (condensation), oil, pumped storage; base in the Netherlands/Belgium: gas (75%);peak in the UK: coal (50%), oil; peak in CEE: gas.



RWE's Germany Division's Power Plant Portfolio*) 2009 (I)

95100.09569.01061963VSEVSE Unit 1

Hard coal270100.0270100.02701971RWE PowerEnsdorf C600100.0600100.06001984RWE PowerGersteinwerk Werne Kv2

49.0Steag36651.0717100.07171981RWE PowerGW Bergkamen A765100.0765100.07651985RWE PowerIbbenbüren

75.4Vattenfall, E.ON12524.612524.65081991RWE PowerRostock588100.0588100.05881963, 1969RWE PowerWestfalen A-C

30.44Various shareholders54.369.67869.6781975enviaMPolandBedzin2,8633,2383,632Total hard coal

5,4866,2956,295Total nuclear25.0E.ON96675.01,288100.01,2881985RWE PowerGundremmingen C25.0E.ON96375.01,284100.01,2841984RWE PowerGundremmingen B12.5E.ON1,16387.51,329100.01,3291988RWE PowerKKW Emsland

1,227100.01,227100.01,2271976RWE PowerBiblis B1,167100.01,167100.01,1671975RWE PowerBiblis A

Nuclear

10,16210,16210,162Total lignite

118100.0118100.01181901, 1987, 1988

RWE PowerWachtberg54100.054100.054RWE PowerFortuna Nord52100.052100.0521939, 1993RWE PowerBerrenrath

2,047100.02,047100.02,0471955-1975RWE PowerWeisweiler151100.0151100.01511993, 1994RWE PowerGoldenberg941100.0941100.09412003RWE PowerNiederaussem (BoA1)

2,716100.02,716100.02,7161963-1974RWE PowerNiederaussem2,059100.02,059100.02,0591972-1976RWE PowerNeurath2,020100.02,020100.02,0201957-1970RWE PowerFrimmersdorf

Lignite%MW%MW%MW

Stake in

PartnerRWE'scommercial

stake

RWE's legal consolidation

stake

Net capacity

Commis-sioned

Operatingcompany

Country(Germany unless stated)

Power plant


*) Rounding differences may occur on the power plant list.


RWE's Germany Division's Power Plant Portfolio*) 2009 (II)

Oil119100.0119100.01191994enviaMGroßkayna 17100.017100.0171995enviaMSermuth

50.0E.ON650.01150.0111987, 1990LEWPeissenberg (gas, oil)141147147Total oil

3,6924,1694,306Total gas3100.03Various3RWE RWNRWN (various)

VariousVarious shareholders216Various216Various353enviaMenviaM (various)21.0Municipal shareholders579.0779.07SüwagSüwag Gas10.1989.91090.0102000LEWLEW Aviko

100.0Krupp-Mannesmann00.0214100.02141975, 1976RWE PowerHuckingen379100.0379100.03791975, 1976RWE PowerHuckingen

100.0Bayer AG00.0260100.02602000RWE PowerGuD Dormagen326100.0326100.03262000RWE PowerGuD Dormagen12100.012100.0122004RWE PowerDortmund20100.020100.0202004RWE PowerBochum

506100.0506100.05062006RWE PowerWeisweiler VGT G, H112100.0112100.01121984RWE PowerGersteinwerk Werne Kv1

1,285100.01,285100.01,2851973RWE PowerGersteinwerk F - I820100.0820100.08201973, 1974RWE PowerEmsland B, C

Gas%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany


Power plant



RWE's Germany Division's Power Plant Portfolio*) 2009 (III)

5100.05100.051928RWE RWNRWW GmbH

1Various2Various2VariousVegetable oil (various sites)25.05City of Düren1100.0175.012005RWE RWNBHKW Schöllershamer (biogas)

172425Total renewables other

11100.011100.0112003enviaMMalchin (biomass oil)1Various1Various3VariousLandfill gas (various sites2100.02100.022007/2009enviaMBiogas (various sites)0100.07100.072003RWE RWNBiomas-fired thermal power

station Neubrücke

Renewables other

195203215Total renewables hydro run-of-river10100.010100.010enviaMenviaM Water

22.4Municipal shareholders1378.81778.817SüwagSÜWAG WaterVarious shareholders153Various155Various167LEWLEW Water

50.0State contract with Luxemb.250.0550.05RWE PowerLuxembourgPalzem12100.012100.012RWE PowerKW Laufwasser (various sites)

Renewables hydro run-of-river

324040Total renewables wind68.7Various shareholders131.3331.33KEVAGWindpark Westerwald (GmbH)42.5957.51557.515KEVAGWindpark Westerwald (KEVAG)

22100.022100.022enviaMenviaM (various sites)Renewables wind (onshore)

%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany


Power plant



RWE's Germany Division's Power Plant Portfolio*) 2009 (IV)

1,096*)100.01,0960.01,096RWE PowerSEO Vianden (pumped stor.)

153100.0153100.0153 1989RWE PowerKöpchenwerk (pumped storage)

31,51633,20633,750Total capacity of theGermany Division

8,7128,7128,712Total contractually secured plants1*)100.010.011997SüwagBHKW Bioenergie Bottwartal

870*)100.08700.0870RWE PowerSchluchsee (pumped storage)160*)100.01600.0160RWE PowerAustriaKaunertal (pumped storage)

10*)100.0100.010RWE PowerRhein-Main-Donau (hydro run-of-river)

29*)100.0290.029RWE PowerNeckar (hydro run-of-river)557*)100.05570.0557RWE PowerOther hard coal811*)100.08110.0811RWE PowerSaarEnergie (hard coal)

2,111*)100.02,1110.02,111RWE PowerRuhrEnergie (hard coal)3,068*)100.03,0680.03,068RWE PowerSTEAG (hard coal)

Contractually secured plants

216216216Total other1100.01100.012003RWE PowerSRS Ecotherm

24100.024100.0241996RWE PowerMVA Weisweiler38100.038100.0381987RWE PowerMHKW Karnap

Other%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany


Power plant

*) Capacities of power plants not owned by RWE, but that RWE can deploy at its discretion on the basis of long-term agreements.



RWE's Netherlands/Belgium Division's Power Plant Portfolio 2009 (I)

3,6343,6343,634Total capacity of the Netherlands/Belgium Division

25100.025100.0251999EssentCuijk

233100.0233100.02331999EssentSwentibold CC33100.033100.0331994Essents‘Hertogenbosch (Den Bosch)

610100.0610100.06101977EssentClauscentrale A

33100.033100.0331995EssentPhilip Morris 1 (Bergen op Zoom)

339100.0339100.03391996EssentMoerdijk63100.063100.0631996EssentKlazienaveen CC 1&2

133100.0133100.01332007EssentBelgiumInesco (Antwerp)

63100.063100.0631996EssentErica CC 1&225100.025100.0251982EssentHelmond GT 1

52100.052100.0521995EssentEindhoven Philipps GT58100.058100.0581985EssentEnschede Cogen

25100.025100.0251988EssentHelmond GT2

363636Total renewables other11100.011100.0111989EssentLinne HH 1-4 (hydro run-of-river)

Renewables other

616616616Total renewables wind415100.0415100.0415EssentVarious sites (Germany)201100.0201100.0201EssentVarious sites (NL)

Renewables wind (onshore)

1,8021,8021,802Total gas

121100.0121100.01211976EssentDonge CC15100.015100.0151972EssentAmercentrale AC21

Gas

1,1801,1801,180Total hard coal600100.0600100.06001983EssentAmercentrale ST 9580100.0580100.05801980EssentAmercentrale ST 8

Hard coal%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany

Country(Netherlandsunless stated)

Power plant



RWE's Netherlands/Belgium Division's Power Plant Portfolio 2009 (II)

AveBe1150.000.0231976EssentHunzestroomAES, Delta10125.000.04051998EssentElsta CCDupont1333.000.0391997EssentDesco

Akzo Nobel9050.000.01801987EssentDelesto 1

40900.01,034Total cogeneration(dispatch rights)*)

AveBe1950.000.0371972EssentDobbestroom

Akzo Nobel17550.000.03501998EssentDelesto 2

Cogeneration (gas)%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany

Country(Netherlandsunless stated)

Power plant


*) Dispatch rights are not included in the total capacity of the Netherlands/Belgium Division.


RWE's UK Division's Power Plant Portfolio 2009

10,25810,25810,258Total capacity of theUK Division

15100.015100.0152003RWE npowerHuntsman Tioxide

2,6572,6572,657Total oil549100.0549100.0549RWE npowerOCGTs (gas oil, various sites)968100.0968100.09681969-70RWE npowerFawley

1,140100.01,140100.01,1401982-84RWE npowerLittlebrook DOil

561561561Total cogeneration (gas)53100.053100.0532005RWE npowerHythe

27100.027100.0271998RWE npowerDow Coming6100.06100.061998RWE npowerIrelandWhitegate9100.09100.091995RWE npowerFort James7100.07100.071999RWE npowerSCA Hygiene Products

99100.099100.0991994RWE npowerAylesford Newsprint81100.081100.0811997RWE npowerBASF58100.058100.0582000RWE npowerBridgewater Paper55100.055100.0551999RWE npowerPhillips Petroleum

135100.0135100.01351999RWE npowerEsso Fawley16100.016100.0161995RWE npowerMillenium Inorganic Chemicals

Cogeneration (gas)

2,4652,4652,465Total gas1,450100.01,450100.01,4501996-1997RWE npowerDidcot B

635100.0635100.06351994RWE npowerLittle Barford380100.0380100.03802001RWE npowerGreat Yarmouth

Gas

4,5754,5754,575Total hard coal1,063100.01,063100.01,0631968-1975RWE npowerTilbury B1,958100.01,958100.01,9581972-1975RWE npowerDidcot A1,554100.01,554100.01,5541971-1979RWE npowerAberthaw B

Hard coal%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany

Country(UK unlessstated)

Power plant



RWE's Central and Eastern Europe Division's Plant Portfolio 2009

HungaryRenewables hydro run-of-river

1100.01100.012007ÉMÁSZ111Total renew. hydro run-of-river

49.0EnBW, MVM3151.06051.0602007MátraHungaryMátra96Various87Various1272000-2005SinergyHungarySinergy (various sites)

517911951Total CEE Division

Lignite49.0EnBW, MVM38951.076351.07631967MátraHungaryMátra

389763763Total lignite

Gas

127147187Total gas

%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany

CountryPower plant



RWE's Renewables Division's Power Plant Portfolio 2009 (I)

67.7132,3032.342005RWE InnogyPortugalSirigo60.6139.4039.422003RWE InnogyPortugalBulgueira

4100.04100.042008RWE InnogyUKBilbster16100.016100.0162008RWE InnogyUKKnabs Ridge

90100.090100.0902009RWE InnogyUKRhyl Flats

60.6139.4039.422009RWE InnogyPortugalGuilhado

12100.012100.012RWE InnogyUKRWE Innogy wind (various sites)

60100.060100.0602009RWE InnogyUKLittle Cheyne Court

3100.03100.032008RWE InnogyUKThe Hollies

Renewables wind (onshore unless stated)

66.72)51)100.0033.351993RWE InnogyUKKirkby Moor66.72)91)100.0033.391993RWE InnogyUKTaff Ely66.72)101)100.0033.3101994RWE InnogyUKBryn Titli66.72)1133.3033.3341996RWE InnogyUKCarno66.72)233.3033.361996RWE InnogyUKTrysglwyn66.72)733.3033.3221996RWE InnogyUKWindy Standard66.72)733.3033.3201997RWE InnogyUKLlyn Alaw66.72)633.3033.3171997RWE InnogyUKNovar66.72)333.3033.3101998RWE InnogyUKMynydd Gorddu66.72)333.3033.381999RWE InnogyUKBeinn Ghlas66.72)233.3033.372000RWE InnogyUKLambrigg66.72)333.3033.3102001RWE InnogyUKBears Down66.72)133.3033.322001RWE InnogyUKTow Law66.72)481)100.0033.3482003RWE InnogyUKCauseymire66.72)921)100.0033.3922004RWE InnogyUKFarr66.72)321)100.0033.3322006RWE InnogyUKFfynnon Oer66.72)601)100.0033.3602003RWE InnogyUKNorth Hoyle (offshore)

6100.06100.062007RWE InnogyUKHameldon Hill5100.05100.052007RWE InnogyUKBurgar Hill

%MW%MW%MW

Stake in

PartnerRWE'seconomic

stake


stake

Net capacity

Commis-sioned

Operatingcompany

CountryPower Plant

1) Capacities of power plants not owned by RWE, but that RWE can deploy at its discretion on the basis of long-term agreements.2) M&G Investment Management Limited, JPMorgan Investment Management Inc.

Market DataPolitical Framework ConditionsAt a GlanceElectricity – GenerationRWE



RWE's Renewables Division's Power Plant Portfolio 2009 (II)

8100.08100.082009RWE InnogyFranceEnergies des Forières S.A.S.

73.3826.7026.7302009RWE InnogyBelgiumThornton Bank10100.010100.0102007RWE InnogyFranceEnergies Hauts Traits10100.010100.0102007RWE InnogyFranceEnergies du Petit Caux

Renewables wind

191919Total lignite2100.02100.022006RWE InnogyCzech Rep.HKW Albrechtice

17100.017100.0171970/1950RWE InnogyCzech Rep.HKW NachodLignite

9269191,140Total renewables wind

18100.018100.0182002RWE InnogySpainAcampo Amijo22.31377.71677.7161998RWE InnogySpainEE de Muel

14100.014100.0142001RWE InnogySpainGrisel I3100.03100.032005RWE InnogySpainGrisel II

191981.02481.0242002RWE InnogySpainLos Labrados191981.02481.0242002RWE InnogySpainPlana de la Balsa191981.02481.0242002RWE InnogySpainPlana de Zaragoza

6.28312193.712993.71292004RWE InnogySpainDanta54.92145.1045.1472005RWE InnogySpainAldehuelas

22100.022100.0222002RWE InnogySpainBosque Alto24100.024100.0242002RWE InnogySpainPlana Maria39100.039100.0392003RWE InnogySpainRio Gallego24100.0 24100.0242005RWE InnogySpainLanternoso21100.021100.0212007RWE InnogySpainBancal18100.018100.0182007RWE InnogySpainSiglos41100.041100.0412009RWE InnogyPolandSuwalki

%MW%MW%MW

Stake in


stake


stake

Net capacity

Commis-sioned

Operatingcompany

CountryPower plant


Hard coal10100.010100.0101992RWE InnogyGermanyKHW Schöneweide101010Total hard coal

Gas14100.014100.0141970/1950RWE InnogyGermany.Heidelberg22100.022100.022RWE InnogyVarious1100.01100.012001RWE InnogyCzech Rep.HKW Breclav

363636Total gas

Renewables hydro run-of-river

PortugalPortugal Portugal

SpainSpainFrance

7100.07100.071998-2000RWE InnogyAERSA (various sites)40.0Gruforsa, Sauces Treinta,

Rŭssula360.0660.061998RWE InnogyVillalgordo (AERSO)

1382.41682.4161996-2004RWE InnogyINVESTERG (various sites)67.67132.3032.331993RWE innogyRibadouro (INVESTERG)

45100.045100.0451958-1989RWE InnogyEnergies France (various sites)

22.0RADAG7878.010078.0100RWE InnogyRADAG (various)244100.0244100.0244RWE InnogyRWE Innogy run-of-river

(various sites)69100.069100.069RWE Innogynpower Renewables

(various sites)

32100.032100.032RWE InnogySaarwasser

60.572139.4039.432008RWE InnogyVales (INVESTERG)493518524Total renewables hydro run-of-river

%MW%MW%MW

stake in


stake


stake

Net Capacity

Commis-sioned

OperatingCompany

CountryPower Plant

RWE's Renewables Division's Power Plant Portfolio 2009 (III)



Renewables other

47.48949.58250.409Total RWE Group

1.5651.5741.817Totally renewable energies

232337Totally contractually secured plants

*)2362.523.00.037RWE InnogySwitzerlandVarious other hydrorun-of-river sites

Contractually secured plants

585051Total renewables other

1100.01100.01RWE InnogySolar (various sites)25.0675.0975.092003RWE InnogyKehl (biomass wood)

20100.020100.0202006RWE InnogyBergkamen (biomass wood)20100.020100.0202005RWE InnogyBerlin-Neukölln (biomass wood)

0.010100.00.5100.01RWE InnogyRWE Innogy (landfill gas)66.7033.30.033.311994RWE InnogySpainAERSA (solar, various sites)

*) Capacities of power plants not owned by RWE, but that RWE can deploy at its discretion on the basis of long-term agreements..

%MW%MW%MW

stake in


stake


stake

Net Capacity

Commis-sioned

OperatingCompany

CountryPower Plant

RWE's Renewables Division's Power Plant Portfolio 2009 (IV)



RWE Power's Major Power Plants in Germany

Natural GasPower plantThermal power plantGas and steamWaste gas recycling

Lignite:Opencast pitPower plantFactory

Hard Coal:Power plant

Nuclear Power:Nuclear power plants

Other:HydropowerRefuse incineration



RWE npower's Major Power Plants in the UK

Didcot A 1,958 MW

Aberthaw B 1,554 MW

Didcot B 1,390 MW

Fawley 968 MW

Great Yarmouth 380 MW

Little Barford 635 MW

Littlebrook D 1,140 MW

Tilbury B 1,063 MW

*) CCGT: Combined-Cycle Gas Turbine.

GasCoalCCGT*)

Oil/Gas



0 400 800 1200 1600 2000

>50

45

40

35

30

25

20

15

10

5

1

0 400 800 1200 1600 2000

>50

45

40

35

30

25

20

15

10

5

1

0 400 800 1200 1600 2000

>50

45

40

35

30

25

20

15

10

5

1

0 400 800 1200 1600 2000

>50

45

40

35

30

25

20

15

10

5

1

~48% older than average ~52% older than average ~70% older than average ~38% older than average

Hard coal (9.4 GW) Lignite (10.1 GW) Gas/oil (3.8 GW) Nuclear (5.5 GW)

1) Westfalen2) BoA 1

Age (years)Age (years) Age (years)

2)

3)

Age (years)

5)

Age Structure of RWE's Power Plants in Germany in 2009 in MW

Average age of existing power plantsAverage age incl. new build projects

3) BoA 2&34) IGCC Hürth5) CCGT Lingen

Existing RWE power plantsNew builds

Source: RWE.

MW MWMWMW 4)1)



Thermal Efficiency of RWE's German New Build Power Plants

Lignite Coal Gas

German average2)

Highest thermal efficiency of RWE's power plant projects

1) Lignite-fired power plant with optimised technology.2) Including capacitiy of power plants owned by RWE.

Weighted degree of efficiency%

36 38

444346

59

0

10

20

30

40

50

60

70

BoA

2&31

)

Ham

m a

ndEe

msh

aven

(NL)

CC

GT

in L

inge

n(a

lread

y in

ope

ratio

n)

>

>

>



Lignite-Fired Power Generation: Higher Efficiency, Less CO2 (I)

Thermal efficiency%

60

50

40

30

20

10

01957 1972 1987 2003 2010 2020

1957Frimmersdorf:150 MWη = 30.8

1966Frimmersdorf:300 MWη = 31.4

1975Weisweiler:600 MWη = 36.6

1970Niederaußem:300 MWη = 35.8

2003Niederaußem:BoA 11,000 MWη > 43

2010Neurath:BoA 2&31,100 MWη > 43

2020700 °C-TBK1,100 MWη ≈ 50



Lignite-Fired Power Generation: Higher Efficiency, Less CO2 (II)

Drop in CO2 emissions in million mt/a

due to new 1,000 MW power plant

5.86.89.7

1957 2003 2020η = 30.8% η > 43% η ≈ 50%

- 30% - 40%



RWE Lignite Production in the Rhenish Mining Region

0

20

40

60

80

100

120

1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020

Million mt lignite

Frimmersdorf-Süd

Frimmersdorf-West

Fortuna-Garsdorf

IndenSüdrevier

Zukunft-West

Frechen Bergheim

Garzweiler IGarzweiler II

Hambach I

Inden I + II

Number of mines10 11 9 9 5 3 3 3 3 34

Actual values Mining capacityPosition: May 2010.



Weisweiler

GoldenbergVille/Berrenrath

Wachtberg

Fortuna-Nord

Niederaußem

NeurathFrimmersdorf

Mönchengladbach

Aachen

≈ 10 km

Mine premises

Former mine premises being restored

Restored mine premises

Approved mining border

Lignite-fired power plant

Coal processing plant

Cologne

RWE's Rhenish Lignite Mining Region



RWE's Emissions Profile in 2009

43.9

105.2

149.1

0

20

40

60

80

100

120

140

160

CO2 emissions Free allocation Shortage

RWE Group in-house electricity generation in 2009 in billion kWh1) RWE Group emissions in 2009 in million metric tons of CO21)

Lignite 70.92)

Hard coal 44.1

Nuclear 33.9

Gas 29.7

Renewables 6.5Pumped storage,oil, other 2.1

1) Including electricity procured from power plants not owned by RWE that we can deploy at our discretion on the basis of long-term agreements, amounting to 18.3 billion kWh, of which 16.2 billion kWh are from hard coal.

2) Includes power stations not owned by RWE that we can deploy at our discretion on the basis of long-term agreements. In 2009, they produced 15.4 million metric tons of CO2 and were allocated certificates for 19.8 million metric tons.


CO2emissions

Free allocation of CO2

certificates

Shortageof CO2

certificatesTotal: 187.2


RWE Power's Nuclear Power Plant Decommissioning Concept

35 – 40%share of costs

5 – 7 years 10 – 15 years 2 – 3 years

Decommissioning

Post operational phase Nuclear dismantling(immediate, deferred)

Conventional dismantling/demolition Final disposal

Power production has ceased

In some cases, technical infrastructure needs to be operated for an additional period

For the time being, fuel elements are being cooled in pond storage facilities until they are suitable for dry-cask (CASTOR) storage on site

Systems no longer need to be shut down

Treatment of operating materials and waste

Dismantling of contaminated and activated systems, structures and components

Materials and waste management (treatment, conditioning, packaging)

Conventional demolishing of buildings/components which fall no longer under the German Nuclear Energy Act (AtG).

10 – 15%share of costs

About 50%share of costs

Final disposal of decommissioning waste



RWE's Hard Coal Purchases by Country of Origin in 2009*)

*) All figures refer to proprietary power plants only.

Source: RWE.

%

Russia 37.55

Germany 21.81

Colombia 15.10

UK 9.69

South Africa 8.84USA 2.58Indonesia 2.23Australia 1.43Others 0.77

Total: 13,170,832 metric tons

Market DataPolitical EnvironmentAt a GlanceElectricity – FuelsRWE


RWE's Use of Fuels in Proprietary Power Plants (I)

1) Adjusted figure.2) Without Essent.

Source: RWE.

Use of hard coal

12.7

15.2

12.9 12.1

9.0

0

4

8

12

16

2005 2006 2007 2008 2009

Million metric tons

Use of lignite

97.6 96.3 100.195.4 92.3

0

25

50

75

100

125

2005 2006 2007 2008 2009

Million metric tons

Use of natural gas

6.3

4.6

6.6 6.8

5.6

0

1,5

3

4,5

6

7,5

2005 2006 2007 2008 2009

Billion cubic metres

7.5

6.0

4.5

3.0

1.5

0


1)

2)

2)


RWE's Use of Fuels in Proprietary Power Plants (II)

Use of nuclear fuel

71

128

90

136129

0

30

60

90

120

150

2005 2006 2007 2008 2009

Metric tons

Use of biomass

616682

882

1,132 1,388

0

200

400

600

800

1000

1200

2005 2006 2007 2008 2009

Thousand metric tons


1,200

1,000

*)

*) Without Essent.

Source: RWE.



Centralised Pan-European Asset Management: Moving Assets Closer to the Market to Widen Margins

> Business plan and investment decisions

> Technical optimisation to increase asset value

> Operation andmaintenance ofgeneration assets

Generating companies(RWE Power,

RWE npower, Essent)

> Sell to customers> Buy back-to-back> Lock in sales margin> Bear volume

and credit risk

Sales companies(RWE Vertrieb,

RWE npower, Essent)

Generation capability

Emissions trading

World coal market

Wholesalepower market

Long-term gassupply contractsand gas markets

Sells power

Sells power to end customers

Industrial, small and medium-sized enterprises, municipalities, residential

Short-term spot

Balancing and reserve markets

> Proprietary trading activities> Face to the wholesale market

Proprietary Trading

Commercial optimisation of assets on behalf of generating companies

Asset-Backed Trading

Sells power

Buys fuelsand carbon

Market DataPolitical EnvironmentAt a GlanceElectricity – TradingRWE


Trading/Gas Midstream Division: Trading Volumes in 2009

> Power: 1,135 TWh> Gas: 415 bcm> Coal: 418,594,000

metric tons> Oil: 662 million bbl> CO2: 235 million certificates

Market DataPolitical EnvironmentAt a GlanceElectricity – TradingRWE

The company headquartered in Essen (Germany) with additional branches and trading floors in London and Swindon (UK) and Prague (Czech Republic). Essent trading offices are located in Geneva (Switzerland) and Den Bosh (Netherlands). Furthermore we

have offices in Houston (USA), Monterrey (Mexico), Ashgabat (Turmenistan), Dubai and Singapore.

million certificatesmillion bbl

million metric tonsbcmTWh

235CO2

662Oil418Coal415Gas

1,135Power

million certificatesmillion bbl

million metric tonsbcmTWh

242CO2

35Oil77Coal

160Gas710Power

Essent



RWE's German Electricity Network (2009)

Circuit length of 340,850 km, with– 93,480 substations and transformers– approx. 5,500,000 low-voltage connection points

(house connections)

19331,0001,784,000Total18201,7001,150,000Low voltage (≤ 1 kV)1994,800505,000Medium voltage (≤ 60 kV)2523,50093,000High voltage (110 kV)

Distribution3111,00036,000

Transmission(ultra-high voltage (380/220 kV))

RWE in %

RWEGerman market*

Length in km

RWE network regions in Germany

Essen

Ludwigsburg

Frankfurt am Main

Stuttgart

Munich

Saarbruecken

Osnabrueck

Koblenz

GelsenkirchenDortmund

Chemnitz

DresdenLeipzig

Halle

Market DataPolitical EnvironmentAt a GlanceElectricity – NetworkRWE

*) 2008 figures.

Source: Bundesverband der Energie- und Wasserwirtschaft e.V. (German Energy and Water Association), 2010.


RWE's German Transmission Business (2009)

850Employees

700Balancing zones within the control area

395Input and output points

350Active traders in the control area

194 TWhAnnual transmission capacity

45 GWInstalled capacity in the control area

11,000 kmNetwork length (380/220 kV)

380 kV-network

220 kV-network

Essen

Frankfurt am Main

Stuttgart

Osnabrueck

Dortmund

Bonn

Karlsruhe

FRANCE

AUSTRIA

POLAND

CZECH REPUBLIC

BELGIUM

NETHERLANDS

LUXEM-BOURG

GERMANY

Bavaria

Baden-Wuerttemberg

North Rhine-Westphalia

Lower Saxony

RhinelandPalatinate

Market DataPolitical EnvironmentAt a GlanceElectricity – NetworkRWE


%

14

28

17

34

96

12

0

10

20

30

40

Germany Netherlands UK Hungary Slovakia Austria Poland*)

RWE Shares in European Electricity Supply Markets (2009)

*)

*) Including minority interests ≥ 20%.

Market DataPolitical EnvironmentAt a GlanceElectricity – SupplyRWE


Thousand (in total: 16,456 thousand)

6,237

172

901

2,231

4,147

2,144

626

0

1000

2000

3000

4000

5000

6000

7000

8000

Germany Netherlands Belgium UK Hungary Poland

RWE Electricity Customers by Region (2009)

*)


*) Including Austria.

6,8638,000

7,000

6,000

5,000

4,000

3,000

2,000

1,000

0

thereof eprimo


RWE Group Electricity Sales Volume by Geographic Region (2009)

*) Difference between electricity production and electricity sales volume due to grid losses, own consumption of lignite production and pumped-storage powerplants.

8.1

1.3

–

2.7

4.1

NL

282.8*)1.117.37.549.9198.9Total

33.9––––32.6Electricity trading (net of electricitypurchased from third parties)

93.91.15.30.9–86.6Distributors

95.7–5.84.229.853.2Industrial and corporate customers

59.3–6.22.420.126.5Residential and commercial customers

TotalOthersHungaryPolandUKGermany

January – December TWh



Division: Germany

Industrial and corporate customers 25%

Total: 108.0 billion kWh

Residential and commercial customers 24%

Distributors 51%



Division: Netherlands/Belgium*)


Electricity trading 19%

RWE Electricity Sales by Customer Group (2009) (I)

*) Figures only relate to the fourth quarter of 2009 due to the first-time consolidation of Essent as of September 30, 2009.



RWE Electricity Sales by Customer Group (2009) (II)

Division: Central and Eastern Europe

Distributors 29%







Division: UK



RWE npower: Competing in the UK Retail Market

Development of customer numbersMillion accounts

Gas

Electricity

Dec 31

(of which dual fuel)

Retail strategy based on creating value

> The UK retail energy market has been through a period of recession and wholesale market volatility; there have been unprecedented falls in electricity and gas consumption in recent years

> Competition has remained intense, leading to pressure on tariffs

> RWE npower’s business retail segment has recovered strongly, with increased product focus and improved account management; RWE npower has the second largest share in the UK electricity market and improved customer satisfaction rankings

> To deliver value, RWE npower co-ordinates its efforts to address the opportunities offered by disruptive technologies and market events


3.8

2.5

4.14.54.4 4.3 4.2 4.2

2.5 2.62.7

2.01.9 2.6

2004 2005 2006 2007 2008 2009 2010 F

6.1(1.4)

6.3(1.6)

6.9(2.1)

7.1(2.2)

6.8(2.2)

6.7(2.3)

6.3(2.3)

RWE npower is continuing to build a value-oriented customer portfolio


RWE Dea: Defined Development Projects Secure Future Earnings Growth

2008 2009 2010 2011 2012 2013 2014 2015

Largest field developments

2011 2012

5.1 mm boeLuno (Norway)

20162010 2013 20152014Production start1)

Gjøa (Norway)

Reggane (Algeria)

Breagh (UK)

West Nile Delta (Egypt)

2.1 mm boe

n/a3)

7.1 mm boe

n/a2)

2016 Production target

Ramp-up of gas/oil production> Doubling of gas and oil

production by 2015 at the latest

> Organic growth through designated development projects

> Increasing production volumes leading to economies of scale

AlgeriaLibyaEgyptPolandNorwayUKDenmarkGermany

1) As of May 2010. 2) Under negotiation. 3) Confidential.

Market DataPolitical EnvironmentAt a GlanceGas − UpstreamRWE


The Upstream Business Value Chain

€ million

213

€ million

855

ActualLicenses

RWE Dea

Thousandkm2

140

Expenses2009

RWE Dea

Capex2009

RWE Dea

Production2009

RWE Dea

Millionboe

33

Exploration

Participationin bid roundsFarm in

SeismicData processingDrilling (dry wells)

Drilling*)

EngineeringConstruction(field and infrastructure)

OperationTransportSale

Development ProductionLicensing

*) Including capitalised exploration and appraisal wells.



Classification of Reserves & Resources

Range of uncertainty

1PProved

2PProved

+ Probable

3P Proved

+ Probable + Possible

Low estimate Best estimate High estimate

Low estimate Best estimate High estimate

P9090% chance of exceeding

the estimate


the estimate


the estimate

Res

erve

sR

esou

rces

C1

C2

C3

E1

E2

S1

S2

Com

mer

cial

Sub-

com

mer

cial

Onproduction

Underdevelopment

Planned fordevelopment

Discovered (contingent)

Undiscovered(prospective)

C-Reserves

S-Resources



RWE Dea – Reserves/Resources 2009 (P50)

Reserves = proved + probable.

Resources = S1 + S2.

360

701 664

147265 235

245122 127

653

347 380

0

200

400

600

800

1000

12001,200

1,000

800

600

400

200

02009 2011e 2013e

392

1,048

387

1,044

362

Natural gas resources

Natural gas reserves

Crude oil resources

Crude oil reserves

Million bbl oil equivalent – end-of-year status

1,013



RWE Dea's Asset Resource Contribution (2009) (I)

1Poland

12Norway

1Denmark10UK

17Germany6Algeria8Libya

45Egyptin %Discovered reserves + resources (C+S)

Discovered reserves + resources (C+S) (RWE Dea share/working interest)

North Africa/Middle East 59%

Total: 1,405 million boe 2)

1) CIS = Commonwealth of Independent States.2) Barrel of oil equivalent.

1Turkmenistan

10Norway4Germany

2Ireland2Poland3UK

1Mauritania3Morocco1Libya

73Egyptin %Undiscovered (risked) resources (E)

Total: 1,945 million boe 2)


Undiscovered (risked) resources (E) (RWE Dea share/working interest)

Germany 17%

Europe/CIS 1) 24%

Germany 4%

Europe/CIS 1) 18%



RWE Dea's Asset Reserve Contribution (2009) (II)

2Denmark19UK19Norway35Germany12Algeria13Egypt%Reserves (C)

Reserves (C) (RWE Dea share/working interest)


Total: 506 million boe2)

1) CIS = Commonwealth of Independent States.2) Barrel of oil equivalent.

Germany 35%

Europe/CIS1) 40%



RWE Dea – Gas and Oil Production Target:Doubling of Annual Volume by 2015Annual gas/oil production (million boe)

> Organic growth through defined development projects> Growth of reserves through conversion of existing resources> Number of exploration/appraisal wells has almost tripled since 2006 (11 32 wells in 2009)> High exploration/appraisal success ratio of above 50% maintained in previous years (approx. 63% in 2009)

2008 2015

Gas

Oil

2716

20

50

0

20

40

60

80

CAGR ~ 12%

36

77



RWE Dea's Key Performance Indicators

1) Source: Herold Global Upstream Performance Review – 2009 Final Report.

2) 5-year average.

10.36.4$/bblProduction costs2)

147.0179.0%Reserve/resource replacement rate (P50 C+S)2)

13.69.4yearsReserve life (P90)

2004 – 20082004 – 2008

Worldwide industry average1)

RWE DeaIndicators



Investment in International & Organic Growth: RWE Dea's Capex Plan per Region

Approx. 1,030855RWE Dea

Egypt: Disouq onshore development, offshore Nile Delta

Libya, Algeria

Approx. 330175North Africa

UK: Southern North Sea (e.g. Breagh)Denmark: Danish North SeaNorway: Barents Sea; Norwegian SeaCEE/Russia: new ventures

Approx. 560604Europe/CIS*)

Gas: further production wells and compression facilitiesOil: further production wells in Mittelplate offshore fieldStorage: extension of storage capacity

Approx. 14076Germany

Average p.a. 2010 – 2014

2009

Additionally approx. €200 – 300 million p.a. exploration cost in 2010 – 2014 (€252 million in 2009)

€ million

Capex

Explorationcost (P&L relevant)


*) CIS = Commonwealth of Independent States (Soviet union succession states).


Upstream Oil & Gas – Overview of RWE Dea's Activities

North Sea/Barents Sea> Mature region> RWE Dea holds position in Norwegian oil production and

is increasing gas production in UK> Objectives:

– Bring on stream new gas fields in UK– Commence liquefaction of natural gas export from

Norwegian Snøhvit field

Germany> Mature region> RWE Dea holds strong position in oil and gas > production and gas storage> Objective: Stabilise production

North Africa> High-potential region> RWE Dea holds outstanding position in gas reserves

in Egypt and owns licenses in Libya and Algeria> Objectives:

– Boost gas production and liquefaction of natural gas export in Egypt through intensive drilling and field development

– Intensify exploration in Libya and Algeria

CEE1)/Eastern NV2)

> High-potential region> RWE Dea holds licenses in Poland> Objective:

– Identify and assess projects in Russia, Ukraine and Caspian Region to establish an upstream position

Production & ExplorationExploration

1) Central and Eastern Europe.2) Eastern new ventures (Russia and Caspian Region).

NORWAY

DENMARK

POLANDUK

ALGERIA LIBYA EGYPT

GERMANY

MAURITANIA

IRELAND


MOROCCO

TURKMENISTAN


Liquefied Natural Gas (LNG) will be of Growing Importance for RWE

> LNG offers customers flexibility and alternative supply sources> LNG offers producers the opportunity to capture the best market price on a global basis (something that

pipeline gas does not always do) > LNG markets continue to be clustered regionally around the Americas, Europe and North East Asia,

but growing interaction offers increased opportunities to those that control LNG production, shippingand regasification

Market DataPolitical EnvironmentAt a GlanceGas − LNGRWE


The Distinctive Features of Excelerate Vessels

Energy Bridge Regasification Vessels can discharge cargo in three distinct ways

GasPortAs vaporous natural gas through the high-pressure gas manifold

The advantage: Excelerate vessels offer more flexibility at lower costs while increasing safety by keeping the LNG vessels away from heavily populated harbor areas.


ConventionalAs LNG through standard liquid loading arms

Deepwater PortAs vaporous natural gas through an STL buoy


RWE's LNG Value Chain with Excelerate

LNG Upstream Liquefaction Shipping Regasification Markets

Existing position (where in operation today)

Excelerate position

Possible future position

Excelerate attribute

> RWE European gas business, trading & optimisation

> LNG sales via Excelerate facilities

> Optimisation of LNG deliveries

> Spot sales to other LNG markets (e.g. Asia, Spain)

> Northeast Gateway and Gulf Gateway (US)

> Teesside GasPort(UK)

> Other Gateways/ GasPorts

> GATE

> Norway charter contracts (traditional vessels)

> Exceleratetraditional and EBRV*) capacity

> Equity stakes in some EBRVs

> Shipping portfolio optimisation

> Technical skill set

> Norway

> Egypt

> Libya

> Algeria

> Third-party long-term LNG

> Third-party short-term (spot) LNG

> Norway

> Third-party gas


*) EBVR = Energy Bridge Regasification Vessel.


RWE Supply & Trading: Full Integration of RWE Group's Midstream and Trading Activities

> Gas procurement for RWE Vertrieb's supply operations

> Gas procurement for RWE Power's power plants

> Management of gas sales for RWE Dea

> Commercial responsibility for all liquefied natural gas (LNG) activities

> Non-regulated gas transport, transit and storage

> Functional responsibility for gas trading

Com

mer

cial

tran

sfer

of s

uppl

y ar

rang

emen

tsRWE Power

Supp

lyin

g

RWE Vertrieb

RWE npower

RWE Dea

Power generation

UK, Germany

Downstream business

UK, Germany, Netherlands,

Czech Republic, Slovenia

Consolidation, optimisation and growth platform for RWE's unregulated gas midstream and trading business

Market DataPolitical EnvironmentAt a GlanceGas − TradingRWE


RWE’s Gas Procurement Portfolio is Only Partly Exposed toGas-to-Oil Spread

> Our gas procurement portfolio is solely managed by RWE Supply & Trading

> ~54% or 27 bcm of total gas procurement based on long-term oil-indexed purchase contracts

– thereof ~16 bcm carry a gas-to-oil spread exposure in 2010 which is expected to increase to ~20 bcm in the coming years

Long-term oil-indexed purchase contracts (take-or-pay)

TTF

31% Russia

31% Norway

22% The Netherlands

16% Germany

NBP

Own production

Market DataPolitical EnvironmentAt a GlanceGas - Trading RWE

approx.50 bcm p.a.


> Perform contract optimisation(maximise the value against the market)

> Trade around positions

> Sales to RWE Vertrieb, RWE Power/STPM, Essent:serve as their sole or main supplier

> Manage gas operations:handle nominations

> Trade underlying commodities:oil, coal etc.

RWE: Making Use of Options is Key for our Gas Portfolio Management

Gas salescontracts

Gas purchasecontracts

Gas storagecontracts

Gas transport contracts

Market DataPolitical EnvironmentAt a GlanceGas − TradingRWE

Where:Germany (all 6 market areas),Czech RepublicThe Netherlands

but also:Austria

Slovakia

Activities


RWE's Position in the European Gas Transit Business

Transgas

Production fieldPipeline operational

Significant position in transit of Russian natural gas to EuropeDirect long-term contractualrelations with Gazexport

MEG

AL WAG

TAG

SOL

HAG

Stegal

Bulgaria

Mac

edo n

i aSoyuz

Yam

alEu

rope

NothernLights

Ureng

oy

Prog

ress

Market DataPolitical EnvironmentAt a GlanceGas − TransportRWE


7.6

9.0

5.4

19.1

7.6

33.5

10.0

1.1

5.4

0.5

Source: Gazprom 2009 quarterly reports.

MEGAL

AUSTRIA

POLAND

CZECHREPUBLIC

GERMANY SLOVAKIA

HUNGARY

CROATIASLOVENIA

FRANCE

ITALY

DEU

DAN

RHG

NEL

NEGP

OPAL

NETRA

JAGAL

YAMALBBL

WEDAL

MEGAL

MIDAL

STEGAL

SELWAG

TAG

HAG

TEN

P

Nabucco

Hora Svate Kateriny

Beregdaroc

Steinitz

RWE Transgas

SWITZERLAND ROMANIA

UKRAINE

Imports of Russian gas (bcm/y)

Gazprom gas sales volumes (2009)

RWE transport capacity

BELGIUM

LUXEMBOURG

NETHERLANDSUKBELARUS

DENMARK

RWE Transgas Located in Strategically Important Part of European Transit Network

Market DataPolitical Framework ConditionsAt a GlanceGas − TransportRWE


RWE's German Gas Market Areas

Thyssengas’s transmission network has a total length of 4,100 km and includes two market areas

Market area Calorific valuecomprimising subgrids of natural gas

Thyssengas H-gas 10.6 – 12.8 kWh/mN3Thyssengas L-gas 9.5 – 10.7 kWh/mN3

GMA gas blending facilitiesHydraulic separationEntry points

UGS Underground gas storage facilitiesFEA Liquefied natural gas facility

Market DataPolitical EnvironmentAt a GlanceGas − TransportRWE


RWE Shares of the European Gas Downstream Market (2009)

7

29

9

64

19

4

0

20

40

60

80

100

Germany Netherlands UK CZ HUN Slovakia

Market DataPolitical EnvironmentAt a GlanceGas − DownstreamRWE

*) Including minority interests ≥ 20%; supply to end customers.

%

Germany Czech Republic*)

UK*) Slovakia*)Hungary*)Netherlands


RWE Gas Customers by Region (2009)

59

2,281

2,641

1,920

1,072

0

500

1000

1500

2000

2500

3000

Germany Netherlands Belgium UK Czech Republic


Thousands

Total: 7,973,000


RWE Gas Sales by Customer Group (2009) (I)

Division: Germany




Distributors 59%



Division: Netherlands/Belgium



Distributors 5%


RWE Gas Sales by Customer Group (2009) (II)

Division: Central and Eastern Europe

Distributors 20%








Division: UK


RWE Group Gas Sales Volume by Geographic Region (2009)

January to DecemberTWh

56.5

2.0

30.5

24.0

NL

332.04.452.575.4143.2Total

103.4––17.084.4Distributors

102.93.87.325.336.0Industrial and corporatecustomers

125.70.645.233.122.8Residential and commercialcustomers

TotalOthersUKCzech RepublicGermany



Transmission and Storage System in the Czech Republic at a Glance

AUSTRIA

POLAND

CZECHREPUBLIC

SLOVAKIA

Hradec Králové

Praha

České Budĕjovice

Brno

HPS Olbernhau

HPS Waidhaus

CS Veselí n. L.

CS Kralice

CS Hostim

SF Háje

SF D. Dunajovice SF Tvrdonice

SF ŠtramberkSB Lobodice

Ostrava

RWE Transgas headquartersGas transmission systemVery-high pressure systemCompressor stationBorder transfer stationInland transfer stationTransfer and metering stationUnderground storage facilityHeadquarters of regional distribution companies

> In the Czech Republic, RWE holds the exclusive license for transmission and licenses for the storage and supply of natural gas

> RWE has a 100% stake in RWE Transgas

GERMANY

SF Třanovice

Ústí n. Labem

Plzeň

MTS Hora Sv. Kateřiny

CS Kouřim

CS BřeclavHPS Lanžhot

CS Strážovice



RWE's Regional Gas Companies: Nationwide Coverage in the Czech Republic

AUSTRIA

POLAND

CZECHREPUBLIC

GERMANY

SLOVAKIA

SMP

JMP

PP

Majority owned by RWE

> Total number of customers: approx. 2.3 million

> Gas consumption in 2009 by segment: key account: 31%; corporate: 30%; retail: 39%

VČP

JČP

ZČP


RWE ENERGIE


Nuclear Provisions

Market DataPolitical EnvironmentAt a GlanceAccounting – Nuclear ProvisionsRWE

Inflation of current cost to the assumed disposal date by a set inflation rate; then discounting of the result back to today (discount rate 5.0%)

Provisions are made for

> Disposal of spent nuclear fuel assembliesFlasks, transport, conditioning, intermediate and final storage

> Decommissioning of nuclear power plantsPost-operation phase, dismantling, removal, final storage

> Disposal of radioactive operating waste (e.g. cleaning cloths, oils, resins) Conditioning, flasks, intermediate and final storage

Public-law liabilities under Sec. 9a of the Germany Nuclear Energy Act

Provisions for uncertain liabilities as per IAS 371

2

3

4


How the Size of the Provision is Determined

Material is earmarkedfor disposal

Step 1:Determine disposal costs at

current price level

Step 2:Inflation by priceincrease rate k Future cost

(as per IAS 37):market value of costs

in n years, when disposal takes place

Step 3:Discount by rate i

(i = 5.0% p.a. before taxes)

Present value offuture cost

Transfer to provisions

t0 tn

Market DataPolitical EnvironmentAt a GlanceAccounting – Nuclear ProvisionsRWE


RWE AG Investor Relations – Contacts

Gunhild GrieveTel.: +44 207 015 5459E-mail: [email protected]

Oliver van der MondTel.: +49 201 12-15141E-mail: [email protected]

Lars KorinthTel.: +49 201 12-15043E-mail: [email protected]

Dr. Stephan LowisHead of Investor RelationsTel.: +49 201 12-15031E-mail: [email protected]

Martin VahlbrockTel.: +49 201 12-15055E-mail: [email protected]

Dr. Burkhard PahnkeTel.: +49 201 12-15182E-mail: [email protected]

RWE AGOpernplatz 145128 EssenGermany

Cornelia RathTel.: +49 201 12-15039E-mail: [email protected]

Contacts for Institutional Investors & Analysts

Contacts for Private Investors

Market DataPolitical EnvironmentAt a GlanceInvestor RelationsRWE

FACTS & FIGURES 2010

Documents

Transcript of FACTS & FIGURES 2010