Case Study: Renewable Energy Projects at the Pueblo of Jemez

1. Case Study:Renewable Energy Projects at the Pueblo of Jemez Raymond R. Krueger Michael Best & Friedrich LLP • 100 East Wisconsin Avenue, Suite 3300 • Milwaukee, WI 53202 Phone: 414.225.2786 • Fax: 414.277.0656 • Email: rrkrueger@michaelbest.com

10. The Pueblo of Jemez • Federally-recognized Tribe • 45 Miles NW of Albuquerque, NM • 2,500 Tribal members in village of Walatowa; 3,000 Tribal members total • Only Towa-speaking Tribe, very traditional • Has occupied the Jemez Valley for over 800 years

12. Summary of the Jemez 3.5 MW ac Solar Project • Generate 3.5 MW ac of solar power using proven single axis flat plate PV on 30 acres of tribal trust land • Interconnect with Jemez Mountains Electrical Cooperative system at existing 69kV transmission line at site • Sell the power and Renewable Energy Credits generated by the project to a local utility • Revenue from power/REC sales go to Pueblo for much needed infrastructure improvements and community services

13. Summary of the Jemez 3.5 MW ac Solar Project (cont’d) • Remains efficient on cloudy days • Lighter weight means better choice for mixed soil conditions • 30-year service life • Single-Axis, Flat Plate Solar Arrays • 30-year track record, highly reliable, easily maintained

14. Summary of the Jemez 3.5 MW ac Solar Project (cont’d) ConceptualSite Plan – 30 Acres

15. Summary of the Jemez 3.5 MW ac Solar Project (cont’d) Looking northeast from atop the mesita across main portion of solar site.

16. Project Benefits • Environmental Benefits: • A coal-fired power plant emits 2,249 lbs. of CO2 gas per MW hour • Over the service life of the equipment, the Jemez Solar Project will offset over 278,876 tons of CO2 • First commercial scale, grid-tied solar project on tribal land nationwide • Project could be replicated by other tribes

17. Project Benefits (cont’d) • Fiscal/Social Benefits: • Provide sustainable, profitable revenue stream to Pueblo • Could improve major infrastructure problems at the Pueblo • Creates track record for Pueblo as a competent renewable energy project developer leading to additional solar, wind, geothermal, and biomass projects • Sets positive example for Jemez students pursuing college and careers in hopes of contributing to the Pueblo and their people Source: U.S. EPA: The Emissions & Generation Resource Integrated Database (eGRID), 2008. http://www.epa.gov/solar/energy-resources/egrid/faq.html

18. How is Project Being Funded? • The Pueblo does not have $20 million it will take to build the project and taking out a loan that big does not work economically • Tax credits work the same as bringing money to the table. They are the same as cash to the bank (equity) • Our Finance Model, developed by Red Mountain Energy Partners, uses three federal tax credits, the Investment Tax Credit, the New Market Tax Credit, and State Production Tax Credits • Combined, these three tax credits cover approximately half of the project cost • The remaining half will be funded by a loan

19. What’s Next? • Complete negotiations on Power Purchase Agreement • Form a Project LLC with finance partners • Complete a geotechnical study and grading and drainage plan • Procure construction services • Break ground Fall, 2010 • Continue development of our geothermal and biomass projects

20. Questions? Raymond R. Krueger Michael Best & Friedrich LLP 100 East Wisconsin Avenue Suite 3300 Milwaukee, WI 53202 414.225.2786 rrkrueger@michaelbest.com