THE CARBON MARKET: Managing the Risks & Capturing the Opportunities

1. THE CARBON MARKET: Managing the Risks & Capturing the Opportunities Measurements that Matter™ 1

2. Presentation Overview To review the Carbon Market, Offsets, and Credits Address Regulatory and Reporting Issues The Jomini Response: MeasurementsthatMatter™ Develop the Strategy: Risk or Reward Eliminate the “GreenWash” Marketing Advantage, Economic and Positional Value: The ROGI™ Strategies in Action: Case Study (MotorSilk™, IIG, Canadian Tire, AAF) Questions 2

3. Key Principles Green Demand Continues to Grow Increasing consumer demand for green products and greener operations creates significant market opportunities- strong economic drivers The pursuit of profits and the aversion to the cost of energy and volatility of fuel prices Going Green Requires Collaboration Greener product creation affects everything R&D processes to manufacturing, supply chains, packaging, marketing and infrastructure—as well as relationships with customers, partners and shareholders Proactive and Progressive Steps are Key Avert legislation, regulation and consumer backlash and promote a green image Corporate “Peer-to-Peer” Pressure Productivity and Efficiency = Cost Benefit 3

4. Carbon Market Review 4

5. Kyoto Protocol: Greenhouse Gases Targeted Green House Gas (GHG) Green House Gas (GHG) Description Description By far the most important GHG By far the most important GHG Carbon Dioxide ( Carbon Dioxide ( CO2) CO2) . . Generated from burning fossil fuels and Generated from burning fossil fuels and deforestation. deforestation. Over 80% of US GHG emissions comes Over 80% of US GHG emissions comes from from CO2 generated from burning fossil CO2 generated from burning fossil fuels fuels Methane ( Methane ( CH4) CH4) Comes from landfills, coal mines, oil and Comes from landfills, coal mines, oil and natural gas operations, and agriculture. natural gas operations, and agriculture. Nitrous oxide (N20) Nitrous oxide (N20) Emitted from the use of nitrogen fertilizers, Emitted from the use of nitrogen fertilizers, from burning fossil fuels and from some from burning fossil fuels and from some industrial and waste management industrial and waste management processes processes Sulfur hexafluoride (SF6) Sulfur hexafluoride (SF6) Used in the electrical insulator, freezing Used in the electrical insulator, freezing agent, heat conductor. agent, heat conductor. Hydroflurocarbons Hydroflurocarbons ( ( HFCs HFCs ) and ) and These are groups of gases Used as These are groups of gases Used as alternative to ozone alternative to ozone - - depleting CFCs in depleting CFCs in Perfluorocarbons Perfluorocarbons ( ( PFCs PFCs ) ) refrigeration systems refrigeration systems

6. Carbon Market Review Discussion from Earth Summit (1992) Kyoto Protocol (1997) Gov’t of Canada responsibility: GHG Quantification and Reporting of GHG Emissions and Removals Standard Adoption of ISO 14064 Standard at COP/MOP 2005 Process ‘sold’ to CSA: accepted by International bodies, i.e. GHG Protocol, ASTM, trading platforms etc. Clean Development Mechanism (CDM): International Trading EU ETS: 2005: Growing pains to 68% world market World market (2009): €136 Billion (€ 11.40 weighted average) Chicago Climate Exchange/RGGI/CAR; Alberta*, BC Pending Legislation/Copenhagen Accord Voluntary Reporting: Carbon Disclosure Project (CDP) 6

7. Carbon Offsets • There are 2 fundamental types of carbon instruments : • Allowances • Project-based credits • Allowances are generally used for compliance with government schemes • An allowance is a permit to emit a quantity of CO2e (normally 1 tonne) • Project-based credits can be used for both compliance and voluntary activities • A project-based credit represents an emission reduction below a baseline (‘business as usual’) • Most credits / allowances are NOT interchangeable with each other for regulatory purposes • Prices vary widely between instruments 2008 2012 2008 2012 7

8. Trading and Use Of Offsets

9. National Trends: Legislation vs Regulation 9

10. The Perfect Storm:Congress, EPA, Corporations and the Consumer Increased Scrutiny – Regulatory/Public concern on emissions 07/12/09: Massachusetts vs. EPA formally declares CO2 a “DangerousPollutant” Mandatory reporting requirements at 25K tonnes (4,500 passenger vehicles) Annual emission reports starting in 2011 for the calendar year 2010 (13k facilities) 02/23/10: EPA announces Phased Approach to Regulation Targeting large facilities in early 2011; medium-sized emitters Q3 2011; smaller emitters 2016 Consideration now to raising the emissions thresholds in its proposed “tailoring” rule to exempt more facilities 02/12/10: U.S. Securities and Exchange Commission’s issues new climate change disclosure guidance Business must now report on how climate change will impact their businesses and how it poses new challenges for them 10

11. Converging Forces: Canada and the United States 06/10/09: Canada issues rules for claiming GHG emissions or “offsets” that will form the basis for a national carbon market Federal System is to complement and not duplicate Provincial Market Based on Provincial methodologies, ISO, and CDM Standards 07/20/09: Canada sets deadline for emissions reporting: Emitters to report 2009 emissions by June 2010 Facilities in excess of 50,000 tonnes GHG emissions to report Alberta moved to same threshold reporting target 31/01/10: Announced Copenhagen Accord Targets “Harmonized” approach with the US 11

12. North American Regional Initiatives

13. Regional Cap & TradePrograms

14. Pre-Compliance “Offsets”

15. Potential Carbon Liability by Sector 12% Carbon costs at $28.24* per tonne of CO2e would equate to at least 1% of revenue for 109 companies. For the five most Carbon Intensive sectors costs would average between 1% and 12% of revenue For 32 companies, carbon costs would equate to over 5% of revenue. 10% 8% 6% 4% 2% 0% Source: Investor Responsibility Research Centre Institute 15

16. Wal-Mart Wal-Mart Taps CDP for Emissions Reporting in Sustainability Index News Release (Little Rock, ARK, July 16, 2009) Wal-Mart's top executive said Thursday that the world's largest retailer hope a new effort to develop eco-ratings for products the company sells can result in international sustainability standards that all retailers can apply to all suppliers. Highlights: Wal-Mart exec foresees eco-ratings for all As Wal-Mart goes, so goes the world. When it comes to carbon emissions reporting, the $406 billion retailer appears to be suggesting that suppliers go through the Carbon Disclosure Project. Additionally, Wal-Mart sees its new sustainability index leading to a universal standard that can be applied across “all retailers, all suppliers,” said Wal-Mart chairman and CEO Mike Duke. “We see this as universal — this is not a U.S. standard,” Duke said during a July 16 meeting to unveil the firm’s new sustainability index. 16

17. Jomini at a Glance 17

18. Integrated Solutions ISO14064 Project Leadership through Jomini Green Filter™ Development of ISO14064 Process Conformance Green Plans and Programmes Deliver economic and marketing benefits From ROI to ROGI™ International Projects: CDM in Asia, Africa North American Regulated (Alta, BC, RGGI) North American Voluntary (VCS, ISO) Federal Offsets for Compliance • Technology company involved in commercialization of new technologies • Government and Private Research & Development • Established “Jomini Network™” as a result of partnerships from interaction seeking or providing unique technology applications/services and products • Provide Solution Sets resulting in Sustainability Opportunities based on ISO14064Conformance and Jomini Green Filter™ Review 18

19. Overview: The Jomini Network &Technology Deployments Manufacturing Automotive Parts: Magna International Inc., Martinrea International Inc. Automotive OEMs: Japan and Europe Process Engineering Vehicle Performance Irving Oil/ Canadian Tire Transportation Rail: Bombardier/ CN Rail/ CPR/ Amtrack Shipping/Intermodal/Rail Operations Trucking and Transport Large Canadian/US Fleets Retail Canadian Tire/Walmart/Mars • Other Segments • Energy Efficiency Bundles and Solutions: ISO, VCS • Wind, Solar and Roofing Technologies: ISO, CAR • Waste to Energy: CDM, JI, ISO, VCS, RGGI, CAR • Forests Protection: • 4 National Government REDD Projects • Equipment Recycling • High Heat Insulation: Oil and Steel: ISO, VCS • HVAC and Lighting Systems: ISO • Hydrogen OEMs • Run-Of River Hydro: CDM, ISO, VCS, ACR • Waste Oil Recovery • Transportation Solutions/Technology: ISO, ACR • Power Supply Solutions • Diversion and Landfill Quantification 19

20. The “Jomini Difference™”: A Leading Advisor Corporate Market Leader • International Scope & Broad environmental Reach • Environment Compliance • Technology Commercialization • Access to World Markets • Establishment of the Jomini Sustainability Network • Driving force in Industry Standards and Protocols: IPOG, US Government* • Expertise in Offset Projects and Key Verticals [Renewable Energy, Forestation, Waste, Air Quality, Transportation] • Significant R&D investment • IP Asset Management Expertise Partner Management Verdecon Capital Inc. • Unique GHG Qualifications • Proven ability to work with CDM, VCS, CAR, ACR, EU ETS, REDD Standards • Corporate Sustainability Programmes • Strategic Marketing for Competitive Distinction • Accelerated ROI Models & Carbon Trading Execution • Bennett Jones, LLP: ISO Standard ‘Framers’ 20

21. Areas of Focus Corporate Facilities Plan Purchasing and Acquisitions • Quantify to Maximize Value from ‘Day to Day’ activities • Replicate Best Practices as Green-Print for Facilities/Operations • Infrastructure Projects • Deploy Clean-Tech/e²-Bundles • Better Cost Management and Operational Savings • ROI of Proposals include Carbon Market Returns • Due Diligence to Include Environmental Risks • Assess all Energy Sources • Intelligence with Environmental Regulation • Understand Supply Chain Procedures*, Transport etc. • Products that have Achieved ISO Process Conformance R&D Activities • Employee Programmes to Assist in Corporate Objectives • Positive Economic and Marketing Returns from Off-Setting Carbon Footprint • Deployment of Quantified and Proven Solutions to Meet Sustainability Initiatives Offset Programmes • Unique GHG Confirmation • Assess Value of Solution from GHG Quantification of Reductions • Meet OEM and Consumer Needs • Accelerated ROI Models • Renewable Energy Projects and Sources 21

22. Emission Reduction Quantification 22

23. Proprietary Process & Programmes GHG Process Conformance Jomini Environmental Inc. Jomini Environmental Inc. Independent Third Party Canadian Standards Association Jomini Environmental Inc. Jomini Environmental Inc. Independent Third Party GHG Credit Exchange Business Strategy & Planning Project Plan & Assertion Validation Project Plan Registration Monitor, Report & Register Verification Aggregation Trading GreenPrint Assessment™ (GPA) Project Phase: Making of an ERR Trading Phase: Making of a VERR

24. Opportunity vs Risk 24

25. Climate Risk & Opportunity: Selected Industries 25

26. Strategic Opportunities: Regulated Entity Energy Efficiency & Renewables (Wind) Transportation Credit Credit Credit Credit Credit Offset Aggregation Verifer Waste Water Management Reforestation Credit Credit Credit Low Carbon Fuel Production Energy from Waste/Tailings Reduced or No Tillage 26

27. Supply Chain “Decarbonization” Source: 2008 World Economic Forum 27

28. “Greenwashing” Runs Rampant 98% of Products’ Green Claims are Misleading ONLY 2% of products claiming in some way to be “green” actually measure up The number of big box store products making green claims has grown 79% since 2007 “Greenwashing” has become an international challenge Source: TerraChoice April, 2009 28

29. “GreenWash” or Green Green.wash (green’wash’, -wosh’) – verb: the act of misleading consumers regarding environmental practices of a company or the environmental benefits of a product or service. 29

30. Strengthen Competitive Position Define/re-define Market Position Internationally Competitive Differentiation Meet Consumer/Client Requirements Establish Leadership Position Review Pricing Strategy Establish clear leadership through increased Market-Share Make use of “ISO14064ProcessConformance” moniker, or other statement depending on Standard and Registry Ability to Register in multiple markets for Environmental market Conformance Marketing Value 30

31. MotorSilk™ - A Case Study 31

32. Case Study A Jomini Sales CorporationSolution Technology developed for NASA at Argonne National Laboratory (US Department of Energy Research Facility) The Boron CLS Bond™, a patented Self-renewing High-performance Biodegradable Anti-corrosive Bottom line impacting Lubricant and surface coating friction reduction technology Winner: Environmental Technology Partnership Award R&D 100 Award 32

33. MotorSilk™ Engine Treatment One-time use; passivates the metallic surface Crystal Lattice Structure creates Boundary Layer with Co-efficient of friction: 0.01 Delivers8% improvement in fuel efficiency for in-use vehicles Decreases emissions through reduction in engine wear (elimination of wear metals) 4-8 hour drive-time to form boundary layer Biostat/Anti-corrosive/Anti-oxidant Displaces varnish, carbon and sludge in used equipment Prevents deposit formation in new equipment Solution is 100% Biodegradable 33

34. MotorSilk™ CO2e Results Project Assertion: High Level of Assurance: ISO Process Conformance Calculated Results for 200,000 Kms: OEM First Fill (10 years @ 20k Kms): 3.67 tonnes CO2e Same for Automobiles and Fleet Vehicles (Driven Kms Dependant) Trucks Short Haul: 120,000 Kms 16.76 Tonnes per annum Trucks Long Haul: 240,000 Kms 33.52 Tonnes per annum CarQuest: 6110 vehicles: 14.5% improvement in fuel efficiency Currently Trading in New York: 32,000 Tonnes Now aggregating for Nestlé Waters (USA), Inter-State Trucking etc. Currently Being Deployed at Kraft (USA): 2500 Trucks to be treated (Class 6, and Class 8) 34

35. Do This Today Will Do This in 12 Months Within the next 12 months many companies will change how they engage with their suppliers Usage of Supplier Management Processes (% of respondents) Joint Process Improvement Track a Set of Sustainability Metrics for Major Suppliers Require 3rd Party Certification for Major Suppliers Reward Supplier Practices Source: A.T. Kearney & Institute for Supply Management 35

36. QUESTIONS 36

37. “Green” Winners Sources: Bloomberg, AT Kearny Analysis 37

38. ISO 14064 Overview Accepted as the Standard ISO 14064-1: Specification for Quantification and Reporting of GHG Inventories and Carbon Footprint Organization Level ISO 14064-2: Specification for Quantification, Monitoring and Reporting of GHG Emission Reduction and Removal Enhancements Projects ISO 14064-3: Specification for Validation and Verification of GHG Assertions These principles are successfully employed by Jomini to Technologies, Products, and Energy Efficiency Applications Across the Globe … able to meet CDM/VCS requirements 38

39. GHG Inventories 39

40. In The News Going Green • Three-quarters of Canadians take into account the environmental impact of their actions when buying a product • The same proportion (75%) also believes that most environmental claims are just marketing ploys • More than 85% want standards enforced and support labelling regulations • Far more consumers would buy green products if they were priced the same as standard items (40%) • Most consumers are not convinced that it actually costs more to produce green products • Survey showed significant opportunity for companies that can prove their products are eco-friendly - ISO 14064, backed by Jomini Source: Gandalf Group for Bensimon Byrne, Globe and Mail, July 2008

41. Areas of Interest Strategic Implications: GHG Reporting companies that complete with more carbon efficient peers could lose market share, or risk investor concern Measuring Direct impacts Understand “hot spots” in operations Financial exposure to carbon and other environmental costs Performance relative to competitors Measuring Indirect impacts from suppliers Minimize supply chain exposure Risks of carbon costs due to inefficiency Benchmark Performance Carbon Footprint Partnership and Jomini Network Access to technology 41

42. Areas of Interest General Operations Facilities/IT Management Process Activities: Furnaces, Kilns, Milling, Grinding Energy Source/Usage Waste Tailings/Re-use- W2E Water Re-Use Transportation On-Site/Truck/Rail/Stand-BY 42