3 RD ENERGY SYMPOSIUM CYPRUS 2014 “Smart power generation”

1. 3RD ENERGY SYMPOSIUMCYPRUS 2014“Smart power generation” Dr. Georgios A. Livanos POWER PLANTS 2013

2. Power Plants We provide superior value to our customers with our flexible, efficient and environmentally advanced energy solutions, which enable a transition to a more sustainable and modern energy infrastructure. POWER PLANTS 2013

3. Power Plants offering • We are a major supplier of flexible baseload power plants operating on various liquid and gaseous fuels • We provide unique, dynamic solutions for grid stability, reserve, peaking, load following and intermittent power generation • Our multi-fuel solutions provide security and optimal choice of fuel in any conditions • Our project development and EPC capability provide customers a choice of everything from single point of responsibility to selected services All applications are supported with tailored lifetime operation and maintenance services. POWER PLANTS 2013

4. Flexible baseload power plants Wärtsilä is the major power plant contractor of liquid and gas fired flexible baseload power plants for utilities, IPPs and industrial self-generators • Sasolburg, 175 MW, natural gas, South Africa, in operation since 2012 • Sangachal, 308 MW, Natural gas& HFO, Azerbaijan, in operation since 2007 POWER PLANTS 2013

5. Dynamic grid stability solutions Wärtsilä multi-unit solutions provide unique, dynamic solutions for grid stability, reserve, peaking, load following and intermittent power generation • Suape II, 380 MW, HFO, Brazil,in operation since 2012 • Reserve for hydro power • STEC, 203 MW, natural gas, Texas, USA, in operation since 2010 • Wind chasing POWER PLANTS 2013

6. Floating power plants Wärtsilä offers floating power plant solutions which integrate our expertise in marine technology with the benefits of flexible, decentralised power generation: • Seaboard, 106 MW, Natural gas& HFO, Dominican Republic, in operation since 2012 • Combined cycle • Lihir, 71 MW, HFO, Papua New Guinea, in operation since 2011 POWER PLANTS 2013

7. 70 countries, 160 locations, 11,000 service professionals Wärtsilä Services global networkWidest range of offering and expertise Installed base 181,000 MW POWER PLANTS 2013

8. Market trends and drivers • GDP growth, electrification and increasing standard of living drive the growth of electricity demand • Demand for sustainability and focus on climate change • Rapid growth of intermittent renewable generation • Escalating daily, weekly and seasonal demand fluctuation increases the need for flexibility • Increasing role of gas, especially as a balancing fuel • Ageing installed capacity drives investments in new technologies The world needs affordable, clean, flexibleand reliable power. POWER PLANTS 2013

9. Smart Power Generation optimisesenergy systems A unique all-in-one combination of valuable features that.... ...enables the transition to a modern and sustainable power system! EnergyEfficiency Affordable Smart Power Generation Smart Power System Operational Flexibility FuelFlexibility Sustainable Reliable Smart Power Generation is a new concept which enables an existing power system to operate at maximum efficiency by effectively absorbing current and future system load variations, providing significant savings. POWER PLANTS 2013

10. Smart Power Generation – unique features Energy efficiency Smart Power Generation • Operational flexibility • Unlimited, super fast, reliable starting and stopping with no impact on maintenance schedule • Fast reserve, load following, peaking and baseload • All ancillary services • Grid support, wind enabling • Multi-tasking plant prepared for future markets • Fuel flexibility • Continuous choiceof the most feasible fuel • Solutions for • liquid and gaseous fuels • renewables • multi-fuel plants • fuel conversions • Hedge for the future Fuel flexibility Operational flexibility Energy efficiency Highest simple cycle electrical efficiency High efficiency regardless of ambient conditions High plant efficiency over a wide load range due to multiple generating sets Competitive generation cost and high dispatch POWER PLANTS 2013

11. Wärtsilä’s Solution – Values & Features 3 2 ALL in ONE ! 5 1 4 1 FASTSTART 2 BASELOAD 3 LOAD FOLLOWING 4 LOW-LOAD OPERATION 5 FAST STOP VALUE Grid stability support Ancillary Services Low start-up costs VALUE Competitive life cycle generation cost VALUE Wind balancing Ancillary Services VALUE ”low load” = No load VALUE No opportunity lost RE enabler FEATURES Power to grid 30 sec Full power 2 min Start-up efficiency FEATURES Highest SC efficiency Multi unit set-up Flexicycle ™ FEATURES Part load efficiency No EOH cost FEATURES 1min shutdown No min down time No fuel cost No emissions FEATURES 1min shutdown No min down time No EOH calculation

12. Provision of flexibility – with & without SPG (UK) SPG can provide a very large proportion of flexible generation, primarily when standing ready but not generating Without SPG, conventional coal and gas must provide a large proportion of flexibility by running at part load, decreasing efficiency With SPG present, conventional coal and gas can provide far less flexibility, and so can run efficiently at full output

13. Value of Smart Power Generation (UK) Potential cost savings due to Smart Power Generation 3 The potential savings in underlying generation costs ( fuel, carbon, imports etc) have also been calculated, and range from £22mn pa (2020 Base wind) to £742mn pa (2030 High wind). These are incurred by generators and are reclaimed through participating in the Balancing Mechanism. 4Balancing Services Use of System • The potential value of the flexibility provided by SPG has been quantified by calculating balancing costs under each of the scenarios: • Balancing costs: the costs incurred by the National Grid when ensuring adequate flexibility on the Grid3 • These costs are passed onto consumers through BSUoS4 charges • There are significant potential savings in all scenarios

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