11-03-09 AES Wind Generation ppt

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					AES Wind Generation
Marty Crotty, President, AES Wind Generation
November 2009
                                                                                Contains Forward Looking Statements

Safe Harbor Disclosure

  Certain statements in the following presentation regarding AES’s business operations may
  constitute “forward-looking statements.” Such forward-looking statements include, but are not
  limited to, those related to future earnings growth and financial and operating performance.
  Forward-looking statements are not intended to be a guarantee of future results, but instead
  constitute AES’s current expectations based on reasonable assumptions. Forecasted financial
  information is based on certain material assumptions. These assumptions include, but are not
  limited to accurate projections of future interest rates, commodity prices and foreign currency
  pricing, continued normal or better levels of operating performance and electricity demand at our
  distribution companies and operational performance at our generation businesses consistent
  with historical levels, as well as achievements of planned productivity improvements and
  incremental growth from investments at investment levels and rates of return consistent with
  prior experience. For additional assumptions see the Appendix to this presentation. Actual
  results could differ materially from those projected in our forward-looking statements due to risks,
  uncertainties and other factors. Important factors that could affect actual results are discussed in
  AES’s filings with the Securities and Exchange Commission including but not limited to the risks
  discussed under Item 1A “Risk Factors” in the Company’s Annual Report on Form 10-K for the
  year ended December 31, 2008, as well as our other SEC filings. AES undertakes no obligation
  to update or revise any forward-looking statements, whether as a result
  of new information, future events or otherwise.

                                                        Contains Forward Looking Statements

Why Wind Generation?
                          • Growing focus on climate change
       Positive Market
                          • Concerns about energy security
                          • Increased government incentives

          Attractive      • Lowest cost renewable technology
      Technology Risk-   • Limited technology risk
        Reward Profile
                          • Short development cycle

                          • Long-term revenue contracts available
      Stable Long-Term
          Cash Flows
                          • Ability to attract debt and partner equity
                          • Attractive long-term equity returns

        Opportunity to    • Global footprint
       Leverage AES      • Expertise in development, construction and
          Expertise         operations
                                                                                                                Contains Forward Looking Statements

AES Wind Has a Presence in Many Key Growth
                                                                                            Other Countries with Forecasted MW
                                                                                                 Additions from 2009-2020
                Top 10 Forecasted MW Additions from                                                         Total MW
                             2009-2020                                                                       Added       AES Wind
                                                                                                            Through      Presence1
                                          Total MW                                                            2020
                                           Added               AES Wind
                    Country                                                                Brazil                5,200
                                          Through              Presence1
                                                                                           Turkey                4,860
               China                           198,152                                    Netherlands           4,348
               U.S.                            134,528                                    Mexico                3,000
               India                            25,605                                    Chile                 1,960
               Spain                            23,896
                                                                                           Ukraine               1,305
               Germany                          21,244
                                                                                           Hungary               1,060
               Canada                           19,328
                                                                                           Bulgaria               990        
               United Kingdom                   19,284                                    Argentina              860
               France                           18,465                                    Philippines            640
               Italy                            11,750
                                                                                           Czech Republic         310
               Australia                          8,470
                                                                                           Jordan                 270

                                                                                           Colombia               110
                                                 Countries with an Existing AES presence
                                                                                           Israel                 100

Source: Emerging Energy Research, Global Market Forecast 2009-2020.                        Pakistan                91
1. Indicates an AES wind presence with operating or construction projects.
                                                                                            Contains Forward Looking Statements

AES Wind History
AES Wind Has Grown and Achieved Scale Via Acquisitions and Greenfield Development

                      2005                    2006                        2007                       2008

        • AES acquires US-       • AES expands into           • AES acquires Storm       • AES acquires Mountain
          based SeaWest            Europe with acquisition      Lake and Lake              View 1&2, 67 MW of
          Holdings and begins      of UK-based Wind             Benton, 187 MW of          generation assets in
                                   Energy, Ltd., a Scottish                                California
          construction of 121                                   generation assets in
                                   development company                                   • AES enters into a
          MW Buffalo Gap 1 in                                   Iowa and Minnesota
                                   with a 600 MW pipeline                                  convertible debt
          Texas                                               • 233 MW Buffalo Gap
                                 • Construction begins on                                  agreement with Brazilian
        • 121 MW Buffalo Gap       233 MW Buffalo Gap 2         2 placed in service        developer, SIIF, which
          1 placed in service      in Texas                   • Construction begins        has 210 MW of
                                 • AES acquires 76 MW of        on 170 MW Buffalo          construction projects
                                   wind generation assets       Gap 3 in Texas           • AES invests in 49.5 MW
                                   in California                                           Hulunbeier, Inner
                                                              • AES expands into
                                 • AES expands into                                        Mongolia, China
                                                                China and enters into
                                   France, investing in                                  • 170 MW Buffalo Gap 3
                                                                a Joint Venture with
                                   proven French wind                                      placed in service
                                   developer, InnoVent,
                                                                Guohua Energy
                                                                                         • Financial close on
                                   with a pipeline of 600       Investment Company
                                                                                           projects in Bulgaria,
                                   MW                           Ltd., a developer with     Scotland and France
                                 • AES invests in a             a 2,000 MW pipeline
                                                                                         • AES executes 2 PPAs for
                                   Bulgarian Wind                                          first PJM project, 100 MW
                                   developer with a 300                                    Armenia Mountain
                                   MW pipeline

               181 MW                  332 MW                      751 MW                    1,058 MW

Note: Reflects owned gross MW.
                                                                                                                                       Contains Forward Looking Statements

AES Wind Generation – Our Expertise Supports
High Growth

 Development & Acquisitions                                                                           Operations and Maintenance
 • 5 M&A transactions                                                                                 • 1,350 MW
 • $1 billion project financings                                                                      • 2,500 Turbines
                                                                                                      • 20 turbine technologies
                                                                   Total MW 2005-2009








                                                       2005             2006              2007              2008                2009
                                                              Acquisitions   Greenfield Development   Planned Greenfield 2009

Source: Emerging Energy Research, Global Power Generation Rankings – most recent rankings.
Note: Planned greenfield includes North Rhins, St. Nikola, Armenia Mountain and St. Patrick.                                                                     6
1. Acquisitions include SeaWest, Miwest Wind, Guohua Hulunbeier, Mountain View I & II and Innovent.
                                                                                     Contains Forward Looking Statements

AES Wind Generation – Our New Project
Opportunities Support High Growth

                Operating                      Construction
                 Projects                        Projects

                     1,350 MW                          472 MW                         1,419 MW

                      France                            UK
                                              France                                    UK

                                                                            China                        U.S.



Note: MW figures are gross.
                                                                         Contains Forward Looking Statements

AES provides a competitive advantage to
AES Wind Generation Power Market Knowledge
                                   •    39 gross GW total
                                   •    Operations in 29

          Corporate Services                                  Effective Deal Origination
      •   EH & S
                                                              • Global developer
      •   Treasury, Tax
                                                                 network to source
      •   HR, Legal, Compliance
      •   IT support                                             project ideas
      •   Office space

      Project Finance Expertise                                    Local Relationships
      • Extensive banking                                      •   Brazil       • India
         relationships worldwide                               •   Bulgaria     • Mexico
      • Structuring expertise                                  •   Chile        • Turkey
                                                               •   China

                                       Vendor Relationships

                                                                                   Contains Forward Looking Statements

AES Wind Value Chain

                          Building the                              Supply
                            Market                                Optimization

                                         to Accelerate
                                             Value                         Leverage
                       Projects             Creation                       Presence
                                                                          & Technical)


   Operations / Relationships

                                                                                                                                      Contains Forward Looking Statements

Summary: Global Opportunity for Wind
Global Wind Capacity by Region, 2009-2020 (MW)









                                  2009      2010      2011       2012        2013    2014      2015         2016    2017     2018   2019   2020

                                                                  Europe     North America   Asia Pacific    Rest of World

• Long-term growth projected at 15% CAGR
• 40+% of new generation installed in U.S. and Europe in 2008 was wind

Source: Emerging Energy Research, Global Market Forecast 2009-2020.                                                                                            10
1. Indicates an AES wind presence with operating or construction projects.
                                                                                                              Contains Forward Looking Statements

   Sector Snapshot

                                                          10000         Gujarat
                  Top 5 in w ind (GW)

                                                                        Andhra Pradesh
                                             2008         8000
   India                                                                Rajasthan
                                                          6000          Maharashtra

   Spain                                                  4000
                                                                        Tamil Nadu

Germ any

           0     5     10     15        20      25         30        2003           2004              2005   2006     2007       2008        2009
                                                                    Source: Infraline; IWEA website

    • Wind power potential estimated at 48,000MW
           – Revised estimates of 65,000 MW based on MW size machines

    • Moderate wind regime (~ 20% - 30% Capacity Factor)
                                                                                                                  Contains Forward Looking Statements

Indian Wind Markets – Key States
                         24%                   Maharashtra and Gujarat are more attractive
                                                                                                                        1.9    5
                                    Wind Potential in GW
Demand Supply Gap (%)

                                    Installed capacity in GW
                                                                AP             KAR                                11

                         9%                                          9          12               6
                                  RAJ                                                      4.3
                                                                     0.1       1.3
                            400             500                600                   700                 800            900

                                                         Per capita income (US $)

                                  RAJ – Rajasthan; AP – Andhra Pradesh; KAR – Karnataka; TN – Tamil Nadu; MAH –
                                                            Maharashtra; GUJ - Gujarat
                                                         RPS specified                           RPS achieved




                        0.0%                                                                                                               12
                                    RAJ            AP                    KAR               TN              GUJ           MAH
                                                               Contains Forward Looking Statements

India Policy Framework
             Electricity Act requires the State    13 States have implemented quotas for
             regulators to set RPS                  RE of up to 14%

             National Action Plan on Climate       5% of the total power purchases from
             Change                                 RE by 2010
             Fiscal incentives                     Option to claim accelerated
                                                    depreciation @ 80% in 1st year
                                                   Import/excise duty relief on specified
                                                    wind turbine parts
                                                   10 year income tax rebate

              New Tariff regulations in Sep         Tariff linked to PLF bands;
              2009 by the Central Regulator         Levelised FIT for PPA term of 13
                                                    years; Uniformity in approach of
                                                    State Regulators

  Evolving   Generation Based Incentive (GBI)       US¢ 1/KWhr generated, expected to
                                                    be issued by year end

                                                    Earnings from RE certificates
             RE Certificate Trading Scheme          traded on a national exchange
                                                    Draft Regulations under discussion;
                                                    finalization expected in 2010 13
                                                                                                Contains Forward Looking Statements

Forecasted financial information is based on certain material assumptions. Such assumptions include, but are not limited
to: (a) no unforeseen external events such as wars, depressions, or economic or political disruptions occur; (b) businesses
continue to operate in a manner consistent with or better than prior operating performance, including achievement of
planned productivity improvements including benefits of global sourcing, and in accordance with the provisions of their
relevant contracts or concessions; (c) new business opportunities are available to AES in sufficient quantity to achieve its
growth objectives; (d) no material disruptions or discontinuities occur in GDP, foreign exchange rates, inflation or interest
rates during the forecast period; and (e) material business-specific risks as described in the Company’s SEC filings do not
occur individually or cumulatively. In addition, benefits from global sourcing include avoided costs, reduction in capital
project costs versus budgetary estimates, and projected savings based on assumed spend volume which may or may not
actually be achieved. Also, improvement in certain KPIs such as equivalent forced outage rate and commercial availability
may not improve financial performance at all facilities based on commercial terms and conditions. These benefits
will not be fully reflected in the Company’s consolidated financial results.
The cash held at qualifying holding companies (QHCs) represents cash sent to subsidiaries of the Company domiciled
outside of the U.S. Such subsidiaries had no contractual restrictions on their ability to send cash to AES, the Parent
Company. Cash at those subsidiaries was used for investment and related activities outside of the U.S. These
investments included equity investments and loans to other foreign subsidiaries as well as development and general costs
and expenses incurred outside the U.S. Since the cash held by these QHCs is available to the Parent, AES uses the
combined measure of subsidiary distributions to Parent and QHCs as a useful measure of cash available to the Parent to
meet its international liquidity needs. AES believes that unconsolidated parent company liquidity is important to the liquidity
position of AES as a parent company because of the non-recourse nature of most of
AES’s indebtedness.