Wind and Hydroelectric Plant Investments in Bulgaria 2008

Wind and Hydroelectric Plant Investments in Bulgaria 2008 ING Structured Finance’s views on the wind generation sector and credentials

Contents • Wind power generation – a growing and maturing market in Europe • Wind power financing – latest trends • Wind power financing – latest trends • ING – wind power financing credentials • ING – wind power financing credentials • ING – wind power financing credentials • ING – wind power financing credentials • Selected financing case studies in Italy

1. Wind power generation – a growing and maturing market in Europe • In March 2007 EU agreed to raise the target of final energy use from renewable sources from 8.5% to 20% by 2020. • Wind is an abundant, clean and cost-effective renewable energy source that is indigenous to Europe. • European manufacturing companies are world leaders (85% market share) in the development of wind energy technology. • In 2006 7.6 GW of wind power capacity worth €9bn was installed in the EU, an increase of 23% compared to 2005. • Over the last five years, approximately 30% of all new electricity-generating capacity installed in the EU has been generated by wind energy. • Total installed wind generation capacity is 48GW (3.3% of the electricity use in EU). • Forecasted increases of the capacity: 80GW by 2010 and 180GW by 2020.

2. Wind power financing – latest trends • Increasing interest • Investments in generation from renewable energy sources have become increasingly attractive for investors. €4.6bn were attracted in public market investments in 2006. • Strong interest from the private investors • €1.2bn were invested in 2006 by venture capitalists and private equity funds. Long-term investors see that the sector is maturing and offers attractive risk-adjusted returns. • Early involvement of the private investors • Traditionally, investments in the pre-construction have been performed on an exceptional basis. Recently, an early involvement is sought. • Partnerships between investors and established developers • Sharing of planning and engineering expertise with financial know how and local experience.

3. Wind power financing – latest trends (cont’d) • Investments in a pipeline/portfolio of projects in addition to individual projects • Apart from standard stand-alone projects we also see investments in equity stakes in a range of assets that are at different stage of development. This brings benefits from scale and diversification of the risk. • Off-shore wind power generation • So far smaller than its onshore alternatives recently the offshore wind projects are getting larger and more ambitious. We believe this market is on the brink of a revolution.

4. ING – wind power financing credentials Selected transactions • In April 2007 ING acted as a joint lead arranger and co-underwriter in the €350m wind portfolio financing for ACS in Spain. • In July 2007 ING committed 50% underwriting for an (unsuccessful) undisclosed bidder for the acquisition of a wind portfolio with a fully credit approved of €1.6bn acquisition debt. • In December 2007 ING signed a mandate with Endesa to act as mandated lead arranger together with La Caixa and sole bookrunner for the Prorener 65 MW wind Farm Project of €100m plus €36m bridge loan in Spain. • ING is a mandated lead arranger, bookrunner and agent for the project financing of a wind farm in Poland (final terms of transaction are confidential).

Italy 12/07 IVPC Power 3 SpA & IVPC Power 8 SpA EUR 197.2 million Structured financing for the construction of 137.65MW WInd farms located in Campania Region - Italy - Participant Utilities - Power 5. ING – wind power financing credentials Selected transactions • In November 2007 ING signed a participation agreement for project financing of a Wind Farm Portfolio in France of €266m. The project consists of development, construction and operation of six wind farms owned by Electricité de France Energies Nouvelles S.A. • In December 2007 ING acted as a participant in a €197mwind farm project financing in Southern Italy (IVPC Power 3 and IVPC Power 8). A case study follows. • In January 2008 ING participated in a €69m wind project Koegorspolder near Terneuzen in the province of Zeeland in the Netherlands.

6. ING – wind power financing credentials Selected transactions • ING acted as joint mandated lead arranger in the €1.13bn refinancing of the 648MW Trinergy portfolio of wind farms in Italy and Germany (closed in 2006). • ING acted in 2004 as financial advisor to the Shell/Nuon consortium in relation to the development of the offshore wind farm built 7km off the coast of Northern Holland in the Netherlands. • ING acted as joint mandated lead arranger (underwriting 25%), together with Dexia, KBC and Banco Urquijo in the SEC Holdco wind farm financing in Spain (closed in 2003). • ING has provided approximately €239m green financing for Dutch wind power projects (in aggregate 190 MW) since 1996 through its Green Financing Desk.

7. ING – wind power financing credentials Prior to joining ING, current Structured Finance team members worked on the following wind power projects: • In 2002 team members worked on an advisory mandate to a major Italian oil company for the sale of 30MW operational wind farm. Approximately 30 potential bidders were identified and approached; one exclusive bidder appointed. • In 2000 team members worked on an advisory mandate for construction of a 160 MW wind farm in Campania, Italy, sponsored by Edison Energie Speciali. • In 2000 team members worked on a mandate for arranging and underwriting of the financing of US$400m IVPC4, a 283 MW wind power project in southern Italy and Sardinia. The sponsors were UPC Group and Edison Mission Energy. • In 1998 team members worked on a mandate for arranging and underwriting the financing of US$190m IVPC1,a 169 MW wind power project in southern Italy. Shareholders were UPC Group and Tomen Corporation (now Eurus Energy).

8. Selected financing case studies in Italy

Italy 12/07 IVPC Power 3 SpA & IVPC Power 8 SpA EUR 197.2 million Structured financing for the construction of 137.65MW WInd farms located in Campania Region - Italy - Participant Utilities - Power IVPC Power 3 & IVPC Power 8€197.2m Structured Finance Facilities • Company Background Transaction Summary • ING’s Role • Structured Finance • The project entails a 137.65 MW in total on 7 wind farms: IVPC Power 8 owns two wind farms for a total capacity of 25.85 MW; IVPC Power 3 owns 5 wind farms totalling 111.8MW. • This is the 6th project developed by the ultimate shareholder/sponsor - Oreste Vigorito - under a project finance structure. Oreste Vigorito is known as the most knowledgeable and experienced developer and operator of wind power initiatives in Italy. • Vigorito is one of the leading experts of wind power in Italy, chairing the national renewable energy association and actively involved in the management and admin of the wind farms. • IVPC is the largest party in wind generation and development in Italy (57%, before Edison (22.3%) and Enel (12.9%). • IVPC Power 3 SpA is a fully owned subsidiary of IVPC Power 8 SpA. • This two tier borrowing structure results from specific requirements for financings under Law 488 grants. • IVPC Power 8 SpA owns a portfolio of fully merchant wind farms. • The total cost of the company’s investment plan amounts to €217 million. • ING was appointed as one of the 8 original Participants banks. Five out of the seven wind farms applied for and obtained subsidised loan awards pursuant Law 311/200 and Law 488/92 under Italian Law (“Law 488”).The subsidised loans, only applicable to project’s Eligible Costs (defined as pure Project Costs) are provided by the Cassa Depositi e Prestiti S.p.A. (CDP), (which is 70% owned by the Italian State and the remainder is shared between 65 local banking foundations). The subsidised loans can be made available by CDP for a maximum of 50% of Eligible Costs subject to a commercial bank providing debt facilities for the same amount for the remainder 50% of Eligible Costs. • Senior Credit Facilities granted at IVPC Power 8 level: • a senior term facility in order to finance IVPC Power 8 contributions in IVPC Power 3 by way of subordinated debt (the “Intercompany Non Eligible Loan”); • five revolving short term bridge facilities with reference to each of the Law 488 Wind Farms (each the “Bridge Loan”) in order to finance IVPC Power 8 contributions in IVPC Power 3 by way of the revolving intercompany loans (the “Intercompany Revolving Loan”), to allow for flexibility of drawdowns every month to cover construction costs, given the restrictions on the Law 488 Facilities drawdowns; • a senior term facility (the “Facility C”) aimed at financing IVPC Power 8 Project Costs (i.e. developments of the two Non 488 Wind Farm); • a VAT facility (the “VAT Facility”) granted to IVPC Power 8 by the Lenders to finance VAT payments during construction in respect of all the wind farms. • Five Law 488 Financings have been made available by CDP and the Banca Finanziatrice/Fronting Bank to IVPC Power 3 with reference to each of the Law 488 Wind Farms. Each Law 488 Financing includes the following facilities: • a senior term facility granted by CDP (the “CDP Loan”) aimed at financing up to 50% of the Eligible Costs; • a senior term facility granted by the Fronting Bank (the “Bank Loan”) aimed at financing up to 50% of the Eligible Costs; • a senior term facility granted by the Fronting Bank (the “Integrativo Bank Loan”) aimed at financing the investment costs indicated under the filing request for Law 488 related to one wind farm and not financed under the two facilities above due to lack of funds under the Law 488 grants.

Italy ongoing SER Spa & SER 1 Spa c.a. EUR 550million Structured financing for the construction of 343MW WInd farms located in Sicily and Puglia Region - Italy Mandated Lead Arranger - Utilities - Power Società Energie Rinnovabili (SER) & SER 1c.a. €550m Structured Finance Facilities • Company Background Transaction Summary • ING’s Role • Structured Finance • The project entails a 343MW in total on 16 wind farms located on six different sites: SER owns six wind farms and SER 1 owns 10 wind farms. • This is the 1st project developed by the joint venture of Api and Iberdrola. • Api Nova Energia is a company of the Api Group, the second largest Italian oil company. Established in November 2006, api Nova energia’s mission is to pursue the diversification of the Group’s activities from the core business of the oil sector, focusing on the development, construction and operation of renewable and assimilated sources initiatives. Api Group main business lies within the oil sector. Api was founded in 1933 as a family-owned business operating in the oil industry. • Iberdrola Group is a vertically integrated utility conglomerate with presence in four geographical markets: Spain, Brazil and Mexico, UK and USA The group is Spain’s second largest utility and fourth largest one by capitalization in Europe • SER 1 SpA is a fully owned subsidiary of SER SpA • This two tier borrowing structure results from specific requirements for financings under Law 488 grants • The total cost of the company’s investment plan amounts to €630 million • ING was appointed as one of 8 Mandated Lead Arrangers. Ten out of the sixteen wind farms applied for and obtained subsidised loan awards pursuant Law 311/200 and Law 488/92 under Italian Law (“Law 488”).The subsidised loans, only applicable to project’s Eligible Costs (defined as pure Project Costs) are provided by the Cassa Depositi e Prestiti S.p.A. (CDP), (which is 70% owned by the Italian State and the remainder is shared between 65 local banking foundations). The subsidised loans can be made available by CDP for a maximum of 50% of Eligible Costs subject to a commercial bank providing debt facilities for the same amount for the remainder 50% of Eligible Costs. • Senior Credit Facilities granted at SER level: • a senior term facility in order to finance SER contributions in SER 1 by way of subordinated debt (the “Intercompany Non Eligible Loan”); • ten revolving short term bridge facilities with reference to each of the Law 488 Wind Farms (each the “Bridge Loan”) in order to finance SER contributions in SER 1 by way of the revolving intercompany loans (the “Intercompany Revolving Loan”), to allow for flexibility of drawdowns every month to cover construction costs, given the restrictions on the Law 488 Facilities drawdowns; • a senior term facility (the “Facility C”) aimed at financing SER Project Costs (i.e. developments of the two Non 488 Wind Farm); • a VAT facility (the “VAT Facility”) granted to SER by the Lenders to finance VAT payments during construction in respect of all the wind farms. • Ten Law 488 Financings will be made available by CDP and by the Banca Finanziatrice/Fronting Bank SER 1 with reference to each of the Law 488 Wind Farms. Each Law 488 Financing includes the following facilities: • a senior term facility granted by CDP (the “CDP Loan”) aimed at financing up to 50% of the Eligible Costs; • a senior term facility granted by the Fronting Bank (the “Bank Loan”) aimed at financing up to 50% of the Eligible Costs;

Wind and Hydroelectric Plant Investments in Bulgaria 2008