Investments in Energy Efficiency

TBLI Conference, London 2011

SUSI Energy Efficiency AG Feldeggstrasse 12

8008 Zürich Schweiz

Tel: +41 44 386 98 00 Fax: +41 44 386 98 09

Email: investors@susi-partners.ch

SUSI Partners

2

About us • Swiss Fund Advisor with proven Luxembourg structure

• Direct investments with measurable impact on environment

• Skilled team with experience on 200+ projects

SUSI Sustainable Euro Fund • Invests in solar and wind projects

• EUR 32 M; Track Record in D, I, B

• Pending EUR 100 M “Conditional Closing”

• Performance forecast 2011: 12.1% (distribution)

SUSI Energy Efficiency Fund • Invests in Energy Efficiency projects in buildings, infrastructure

and industrial processes

• EUR/CHF compartments

• Launch planned in 2012

Investors • EKZ (Utility of the Kanton of Zürich)

• Pension Funds

• Family offices from CH, D, GB

Energy

Efficiency

Fund

Advisory

Board

Sales

Sustainable

Euro Fund

22

24

26

28

30

32

34

36

38

2005 2010 2015 2020 2025 2030

Energy Efficiency Fossil fuel switch

Renewable energies Nuclear energy

Carbon capture and storage Remaining CO2 emissions

Improving Energy Efficiency is Key to Reducing Greenhouse Gases

3 Sources: 1 Eco-efficiency. Chapter 6 – Environmental performance of constructions 2 Communication from the European Commission: Action Plan for Energy Efficiency: Realising the Potential 2006

European energy consumption and savings potential by 20202

Development of global potential for energy efficiency improvements1

Energy Efficiency is biggest lever for reducing global greenhouse gases.

0

100

200

300

400

500

600

Energy savings potential 2020Energy consumption 2020Energy consumption 2005

25% 26%

28%

Gt CO2 Mt CO2

Buildings Transport Industry

EU has significant potential for energy savings, especially in buildings

Energy Efficiency Market: Great Potential, Strong Growth

4 Sources : 1 Communication from the European Commission: Action Plan for Energy Efficiency: Realising the Potential 2006 2 Pike Research, ESCO: Energy Service Companies

European ESCO (Energy Service Company) Market2

Bil €

€ 13.2 B

2010 2016

€ 8.5 B

CAGR: 7.5%

Bil €

Estimated necessary investments for implementation of EU legislation on energy

efficiency in buildings1

Total Investment

€ 500 Mrd.

10-12 Years

6-8 Years

2-4 Years

2-4 Years

2-5 Years

2-5 Years

2-4 Years

2-4 Years

HVAC - VFD Chillers

HVAC - High Efficiency Boilers

HVAC - Air Handles

HVAC - VFD Motors

BMS - Building Controls

BMS - Demand Control Ventilation

Lighting - Controls

Lighting - LED Retrofit

Energy Efficiency Projects Based on Existing Technologies

5 Source: SUSI Analysis

Payback periods of various technologies

Proof of Concept: Successfully Implemented Energy Efficiency Projects

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Investment/ % Energy Saving / Years until Payback

Klinikum Bremerhaven

€ 5.2m / 31% / 5.1 Y

€ 13.2m / 38% / 3 Y

Empire State Building

€ 1 m / 36% / 2.8 Y

Wien Courtyard Marriott

€ 11.5m / 52% / 2 Y

Mervyn Department Stores

€ 1.2m / 29% / 3.4 Y

München Allianz Arena

€ 57m / >50% / 5.7 Y

City of Los Angeles

• 25-50% Energy Savings • 2-6 Years Payback Universidad Iberoamericana

€ 4.5m / >25% / 5 Y

Transport of London

Sources: Publicly availabe case studies from Cllnton Foundation, Berliner Agentur, Siemens, Naesco.org, Nyconenergy,

€ 0.9m / 19% / 6.6 Y

Hurdles in Energy Efficiency Retrofit Projects

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What is the biggest barrier to potential energy savings in your organization?

3%

4%

4%

6%

6%

12%

18%

18%

29%

0% 5% 10% 15% 20% 25% 30% 35%

Other

Dedicated attention, Ownership

Owner/Operator Split Incentives

Inability to Finance

Buy-in Senior Leaders

Technical Expertise

Insufficient Payback/ROI

Uncertainty Payback/ROI

Capital Availability

Source: Johnson Controls and IFMA, survey on energy efficiency of 1400 managers responsible of real estate budgets, 2009

Example Financing Solution for Energy Efficiency Projects

Energy Provider

Building Owner

SUSI Energy Efficiency Fund

Technology Partner

Initial invest- ment:

€ 2.0 m

Retrofit of building

Mini- mum

savings guaran-

tee

Description

• Technology Partners retrofits the building

• The Fund finances the project upfront

• Energy Performance Contract signed between Building Owner and the Fund

• Resulting Energy Savings are split between the Building Owner and the Fund

30% energy savings: € 0.15m

70% Energy

Annual Energy costs: € 2.0 m1)

Reduced energy

costs: € 1.5 m

Savings: € 0.35m

8

Concept of an Energy Performance Contract

9

Customer Benefits

• Building modernization at no upfront cost

• Reduction of operating and maintenance costs

• Measurable environmental impact

• Increase in property value

• No customer capital required

• No investment risk

• Off-balance sheet energy savings contract

Energy Savings paid to Efficiency Fund

Savings to Customer

Energy costs after investment Init

ial E

ne

rgy

Co

sts

Contract duration

Minimum Savings Guarantee Costs

Years

Business Model With Stable Cash Flows and no Exit Risk

10

-20

00

35

0

35

4

35

7

36

1

36

4

36

8

37

2

37

5

37

9

38

3

15

0

15

2

15

3

15

5

15

6

15

8

15

9

16

1

16

2

16

4

55

2

55

8

56

3

56

9

57

5

-€ 600

-€ 400

-€ 200

€ 0

€ 200

€ 400

€ 600

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

SUSI Return Customer Savings

Figures in Thousand €

-€ 2‘000

Revenues: • Prior annual energy costs: € 2'000'000 • Post-retrofit energy costs: € 1‘500'000

•Annual savings 25%: € 500'000 • Participation owner 30%: € 150'000 •Annual fund return for 10 years € 350'000 •Annual Energy Price increase 1%

IRR: Total cash flow to the fund over

10 years: € 3‘662‘000 IRR (after costs): 12.5%

Investment: • Total investment: € 2‘000‘000 • Fund equity: € 1‘000‘000 • Fund debt: € 1‘000‘000

What do investors want – What do Energy Efficiency investments offer?

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Returns • Generating yields

• Stable distributions

Transparency • Clear, comprehensible strategy, not a

"blind pool"

• Full disclosure of all costs / fees

Sustainability • Financially-Socially-Economically

• Measureable positive impact

Minimal Correlation •No correlation to stock market

•Predictable returns

Liquidity • Potential daily access to funds

• No yield losses

Risk Minimization • Project diversification

• Capital preservation

Conclusions

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Energy efficiency is a growth market with great potential: • Energy efficiency is the biggest lever for reducing greenhouse gases

• Technologies available and proven

• Strong market growth expected in the coming years

• Innovative concepts to overcome lack of funding are available

Investments in energy efficiency projects bring the following benefits: • Very good risk-return profile

• Minimal correlation to other markets

• High and stable distributions (substitute for fixed income products)

• No exit risk

• Measurable sustainability impact

Necessary elements for success: • Reliable technology and operating partner

• Expertise in project selection

• Good portfolio diversification

Kontakt

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Contact Information SUSI Energy Efficiency AG Feldeggstrasse 12 8008 Zurich Schweiz Tel: +41 44 386 98 00 Fax: +41 44 386 98 09 Email: investors@susi-partners.ch

Presenter: Tobias Reichmuth, CEO SUSI Partners AG Tel: +41 44 386 98 01 Email: t.reichmuth@susi-partners.ch

Thank you for your attention!