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©PPC RENEWABLES S.A.

The Promise of Renewable Energy Sources & their Impact on Security of Supply

Manthos KalliosDirector, Corporate Strategy & Business Development

“Energy Without Frontiers” ConferenceAthens, 22 May 2008

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Global Market Overview

Greek RES Market

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KEY GROWTH DRIVERSKEY GROWTH DRIVERS

International organizations predict drastic growth of RES in order to combat climate change…

Global decisions to promote a cleaner environment

Environmental conscience and acknowledgment of need to tackle climate change

Oil independence policies

Reduction in initial investment cost

More productive technology

Global decisions to promote a cleaner environment

Environmental conscience and acknowledgment of need to tackle climate change

Oil independence policies

Reduction in initial investment cost

More productive technology

1 Source: WGBU2 1 EJ = 278.000 GWh

1 Source: WGBU2 1 EJ = 278.000 GWh

Global Energy Production1 [EJ2]

…however dominance by RES is still far in the future

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The total costs of electricity production from RES exceed those from conventional sources…

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

4,5

Nuclear Natural Gas Coal Wind PV Hydro Geothermy

* Includes levelized CapEx and OpEx Sources: OECD/IEA

0

20

40

60

80

100

120

140

Nuclear NaturalGas

Coal Wind PV Hydro Geothermy

Initial Investment Cost per MW Production Cost* per MWh

€ MM €

… but the evolution of technology and economies of scale are progressively reducing the cost differences between methods

… but the evolution of technology and economies of scale are progressively reducing the cost differences between methods

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Demand for solar is accelerating although forecasts differ

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This has resulted in a dramatic market capitalization of the solar sector

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The RES sector is evolving with utilities entering the sector aggressively…

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…leveraging also M&A initiatives

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M&A Map for Wind

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IPO Analysis – Recent Transactions

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Financial performance differs across RES sectors

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Solar sector stock performance is strong, despite the recent correction

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Currently, offshore plays a minor role in wind energy production; however revamped interests indicates that substantial growth will take place

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Key Uncertainties

Continuous growth for the solar industry or boom-bust cycles?

Tightness or abundance of supply from wind turbine manufacturers?

The government dilemma: What incentives, how much and when?

How can Network absorption impede or facilitate RES expansion?

Will RES expansion be used actively by governments as a lever to secure supply?

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Global Market Overview

Greek RES Market

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Greece has significant natural wealth for RES…

• Wind potential for some 14.000 MW

• Geothermal fields with production potential of ~350 MW (equivalent to 1.500 MW of wind power)

• Many springs and rivers for hydroelectric power

• Some of the highest solar irradiation rates in Europe

…but exploiting it fully will involve overcoming serious obstacles

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78,1

60,0

49,3

31,529,0

33,631,0 29,4

39,0

25,021,0

12,5

20,1

13,29,0 8,0 10,0

7,0 5,7 7,53,6

6,0 5,1 5,0 6,0

21,0

0

10

20

30

40

50

60

70

80

90

Αυστρ

ία

Σουη

δία

Λάτβια

Φινλ

ανδί

α

Δανία

Σλοβ

ενία

Σλοβ

ακία

Ισπαν

ία

Πορτο

γαλία

Ιταλία

Γαλλ

ία

Γερμ

ανία

Ελλάδ

α

Ιρλα

νδία

Ολλαν

δία

Τσεχ

ία

Μ. Β

ρετα

νία

Λιθουα

νία

Λουξε

μβού

ργο

Πολω

νία

Ουγγα

ρία

Βέλγιο

Εστον

ία

Μάλ

τα

Κύπρο

ςΕ.Ε

.

The EU has set environmental improvement targets based on RES use which as a rule are not yet being met

Source: State of renewable energies in Europe, EurObserv’ER 2006

[%]

Electricity produced from RES in Europe, by country[% consumption]

Status 2005

Gap to 2010 target

EU Target

2007: EU member states decide to increase total energy produced from RES to 20% by 20202007: EU member states decide to increase total energy produced from RES to 20% by 2020

2001: All EU member states adopt national targets for the proportion of electricity consumption that should come from RES (Directive 2001/77/ΕU)

2001: All EU member states adopt national targets for the proportion of electricity consumption that should come from RES (Directive 2001/77/ΕU)

For 2020, the European Commission proposed the binding targets known as «20-20-20»— 20% of the European energy

production portfolio to be RES — 20% reduction in Greenhouse

Gas emissions, compared to 1990

— 20% energy savings— 10% of fuel used in transport to

be biofuel

Greece’s target for total energy consumed to come from RES has been set at 18%; hence RES have to account for 30-35% of electricity generation (this means some 10,000 MW of RES production by 2020)

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Implementation of RES projects must be accelerated in order to achieve the 20,1 % target following the 77/2001/EC directive

Sources: DOE/EIA, ΥΠ.ΑΝ.

Amount & Proportion of RES Electricity Production in Greece

0

2

4

6

8

10

12

14

16

1999 2001 2003 2005 2007 2010

Pro

du

cti

on

[Τ

Wh

]

0%

5%

10%

15%

20%

25%

% R

ES

RES

% RES

Target(20,1%)

Wind will be the main driver for Greece to meet her RES targetsWind will be the main driver for Greece to meet her RES targets

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GREEK RES MARKET [MW]

963

4.350

4.700

3.970

2.140

1.522

2.686

3.340

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

5.000

2007 2008 2009 2010 2011 2012 2013 2014

Ins

talle

d C

ap

ac

ity

[M

W]

OTHER RESGEOTHERMYPHOTOVOLTAICSMALL HYDROWIND

We hope that the 20,1% target will be achieved by 2012

The 20,1% target will

not be achieved by 2010

* Includes 4,5 TWh from large HPP* Includes 4,5 TWh from large HPP

Sources: Dept. of Energy/EIA, MinDev, RΑΕ, PPCR estimates

Drivers

Financially attractive environment for investments

Annulment of production permits that show no progress after 2 years

Passage of a Land Use Plan for RES

2007 2008 2009 2010 2011 2012 2013 2014TOTAL DEMAND [TWh] 60,8 62,8 64,8 67,0 68,7 70,5 72,3 74,2RES PRODUCTION* [TWh] 7,2 8,6 10,2 11,6 13,1 14,5 15,7 16,6% RES PRODUCTION 12% 14% 16% 17% 19% 21% 22% 22%

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The interest for RES projects in Greece is significant…

TechnologyWith Operation

Licenses (1) [MW]

With Installation Permits

[MW]

With Production Permits (2)

[MW]

Applications for Production Permits (3)

[MW]

Wind 773,8 916,4 6.492,4 35.495,5

Biomass 32,1 23,5 94,8 451,6

Geothermic 0,0 0,0 8,0 335,5

Small Hydroelectric 101,9 103,9 514,3 1.864,5

Solar P/V 0,8 2,2 80,4 3.061,9

Total Capacity [MW] 908,6 1.046,0 7.189,9 41.209,0

1) The above mentioned Operation Licenses include RES projects from the Combined Production Permits of PPC2) These include the projects with Operation Licenses, Installation Permits and do not include Revoked Licenses3) These include the projects with Production Permits as well as Revoked Licenses

Source: RAE

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…driven, in part, by attractive Feed-in Tariffs

Renewable Energy SourceFeed-in Tariff* (€/MWh)

Mainland Grid & Connected Islands

Non-Connected Islands

Onshore Wind 75,82 87,42

Offshore Wind 92,82

Small Hydro <15 MWe 75,82 87,42

Photovoltaic <100 kWp 452,82 502,82

Photovoltaic >100 kWp 402,82 452,82

Other Solar Technologies <5MW 252,82 272,42

Other Solar Technologies >5MW 232,82 252,42

Geothermy 75,82 87,42

Other RES 75,82 87,42

* According to RES Law 3468/06, increased by €2,82 in July 2007

These prices may be altered by the Ministry of Development following a proposal from RAE

These prices may be altered by the Ministry of Development following a proposal from RAE

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Some key steps to accelerate RES expansion in Greece

Review of Installation and Production Permits (and Grid connection terms) for wind parks that haven’t yet begun construction

Different regulatory regime for PV installations <150 kWp

Broader scope for subsidizing RES projects, without allowing excess profits

Further improvement of the Permit Issuance process and the Land Use Plan

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In Conclusion

There is already potential for RES to play a role in electricity supply both globally and in Greece in the short term

However, dominance of RES to the extent that we can talk about a real contribution to security of energy supply is still a distant prospect and should only be viewed in the medium to long term— In the short term, RES can only have limited role in security of supply

— In the medium term RES should be able to play a more significant role in the security of supply of the electricity supply market if national targets are met (e.g. 29% by 2020 for Greece)

— In the long term and as RES’ share in the electricity supply market increases with the development of new RES technologies and the efficient operation of a fast growing RES market, RES can play an even greater role in the security of supply of the electricity supply market;

In the even longer term, with the greater development of new RES technologies and the efficient operation of the RES market, RES could play the role of the catalyst that will drive the development of new consumer and industrial products that until today traditionally are “fueled” on petroleum or natural gas. This effective transition from petroleum “fueled” products would also have to be supported by the necessary State incentives both for industry and consumers in order to drive for this new technology and thus decrease even further countries’ dependence on these two fuels.

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Manthos KalliosManthos Kallios+30-211-211 8000+30-211-211 8000mkallios@ppcr.grmkallios@ppcr.gr

Thank you for your attention!