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EWEC Warsaw, April 21, 2010

Wind – key developments. Rabobank: Current wind market developments from a bankers’ point of view. EWEC Warsaw, April 21, 2010 Marc Schmitz Senior Vice President, Renewable Energy and Infrastructure Finance. Introducing Rabobank. 9.5 million clients. EUR 568bn Total Assets.

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EWEC Warsaw, April 21, 2010

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  1. Wind – key developments Rabobank: Current wind market developments from a bankers’ point of view EWEC Warsaw, April 21, 2010 Marc Schmitz Senior Vice President, Renewable Energy and Infrastructure Finance

  2. Introducing Rabobank 9.5 million clients EUR 568bn Total Assets EUR 2.7bn Net Income Rabobank International Rabobank Nederland Local Rabobanks • Wholesale banking • REIF • Rabo Securities • Food & agri M&A cooperation with Rothschild • Corporate clients • Leveraged finance • International retail banking • Corporate social responsibility • Investor relations • Long term funding • Other staff units • Private individuals • Small & medium sized enterprises • Private banking • Other support units Asset Management Leasing Real Estate Insurance Business Housing • De Lage Landen • Athlon • Rabo Real Estate • FGH Bank • Eureko (39%) • Interpolis • Obvion • Zoekallehuizen.nl • Bizner • Rembrandt • Robeco • Schretlen & Co • Sarasin • IRIS S&P and Moody’s re-confirm triple-A rating (June/August, 2009) World’s safest privately owned bank (Global Finance award, 2008)

  3. Introducing REIF • Renewable Energy & Infrastructure Finance is Rabobank’s center of competence for project finance and renewable energy transactions • Product offering and positioning • Providing project finance to the renewable energy sector • REIF is a leading player in the renewable energy markets • Sector focus • Offshore Wind • Onshore Wind • Solar • Biofuels / Biomass • Infrastructure • Geographic focus • Europe (team in Utrecht) • Americas (team in New York - especially USA & Canada) • India (team in India)

  4. The Market – Onshore wind • Installed capacity end 2009 is 158 GW • Large regional differences: China very fast and continuous growth, US fast recovery from economic crisis sustained by additional government support, Europe diverse but generally slower recovery with 2010 still a difficult year • Relatively mature sector; technical progress is focused on increased turbine efficiency and grid compatibility • Shortages in value chain have disappeared, especially in US and Europe now more buyers market, leading to falling prices. Regionally the increased manufacturing base may lead to fierce competition (especially in the US) • Wind farm O&M, refitting and repowering will become increasingly important

  5. The Market – Offshore wind Annual offshore wind market: shortages may develop by 2014/2015 • Installed capacity end 2009 is 2.1 GW; this is expected to increase to around 35 GW by 2020 • Total global installed offshore wind capacity is a mere 1% of total installed wind capacity • Currently most attractive markets: UK, Germany, Belgium, Denmark. Upcoming markets: The Netherlands, France, Scandinavian countries, US, China • Technical progress is leading to increasing efficiency, decreasing cost, better reliability – ultimately higher returns • A fast developing sector, causing (possible) shortages in the value chain; most notably in turbines, foundations, and bank funding • Currently offshore wind is a utility play, however, future investments will become too large to carry on-balance; becoming a more investor-driven market

  6. Rabobank offshore wind pipeline • Current offshore wind non-recourse financed deals: • Prinses Amalia Windpark 120 MW (Vestas 2 MW) • C-Power 30 MW (Repower 5 MW) • Boreas 196 MW (Siemens 3,6 MW) • Belwind 165 MW (Vestas 3 MW) • New offshore wind non-recourse financed deals in pipeline: • Borkum (Multibrid) • Wetfeet (Multibrid) • Lincs (Siemens) • Bard (Bard)

  7. Specifics of non-recourse financing in offshore wind • Project size large (EUR 500 – 1,500 mln) • Involvement of ECAs (EKF, Hermes) (EUR 200 – 250 mln) • Involvement of EIB (EUR 150 – 250 mln) • Limited number of commercial banks active in the offshore wind market • Shortage of capital due to size of future projects and number of banks active

  8. Wind energy financing parameters

  9. Belwind deal – an overview • Senior lenders: Rabobank, ASN, Dexia, EIB, EKF • Mezzanine lenders: e.g. Rabobank, PMV • Equity providers: Rabobank, Colruyt, SHV, Meewind, PMV • Why does Rabobank consider mezzanine lending: • Less equity required • Higher leverage in the projects • Higher return on equity • Total financing package (i.e. senior / mezzanine / equity)

  10. Belwind deal – the structure Legal: Allen & Overy Insurance: JLT PMV Meewind Colruyt SHV Rabo Project Equity Market: Poyry Lenders’ advisors Equity Rabobank, Colruyt, PMV, Van Oord Technical: Mott Mac Do Mezzanine Debt Rabobank, Dexia, ASN, EIB, EKF Belwind NV (Belwind I&II) Electricity Supply & Revenues Green Certificates & Revenues Turbine supplier and O&M: Vestas EPC Contractor: Van Oord Green Certificates Off taker: Elia Electricity Off taker: Electrabel Rabobank REIF

  11. Belwind deal – the process • Issues • Hard to get equity in place; loss of several equity providers during the process • Financial difficulties developer • Low grey electricity prices • High financing costs • Time consuming Success factors • Stable group of MLA’s; Financing already in place in March; Support of EIB and EKF • Good subsidy regime • Relationship between contractors, MLA’s and final shareholders • Experienced MLA group; Rabo, Dexia, EKF involved in Q7/ Prinses Amalia Park • Same contractors as Q7/ Prinses Amalia Park (Van Oord & Vestas)

  12. The Belwind deal: award winning • Euromoney and Ernst & Young Global Renewable Energy Awards 2009 – Deal of the Year – Infrastructure • PFI Awards 2009 – Power Deal of the Year (Europe) • Euromoney Project Finance Magazine 2009 – Offshore Wind Deal of the Year • IJ Infrastructure Awards 2009 – Global Deal of the Year

  13. Rabobank credentials – Wind

  14. Contact details Rabobank international Renewable Energy & Infrastructure Finance Visiting address Croeselaan 28 3521 CB Utrecht Postal address P.O. Box 17100 3500 HG Utrecht The Netherlands Marcel Gerritsen Global Head of REIF – Managing Director T. +31 30 712 3342 E. Marcel.Gerritsen@rabobank.com Marc Schmitz Senior Vice President T. +31 30 71 23351 E. Marc.Schmitz@rabobank.com Roland Theuws Senior Vice President T. +31 30 71 23352 E. Roland.Theuws@rabobank.com

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