siemens.com/answersRestricted © Siemens AG 2013. All rights reserved

siemens.com/answersRestricted © Siemens AG 2013. All rights reserved

siemens.com/answersRestricted © Siemens AG 2013. All rights reserved

The Siemens Wind Power LCOE

Siemens Wind Power: The path towards below 100€/MWh

Page 2 Nov. 2013 EMEA OF BD / Siemens Belgium

What is the challenge? - to reduce the cost of electricity to pair other technologies

30-40% reduction

2012 2020-2025

Offshore wind competitive with

CCGT

Unit cost/MWh

Nuclear CCGTOnshore CoalBiomassOffshorePV Solar

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Costs of offshore wind will be significantly lowerat the end of this decade

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How does each plan add to the total? -Siemens Wind Power target towards 2020: < 10 € cent/KWh

Target FID 2020

18%

28%

Costout

3.6

16%45%14%25%

Baseline 2014

14.5

24%

32%

17%

27%

9.5

26%

28%

18%

27%

AEP increase

1.4

100%

Cost target 2020

10.9

26%

28%

E-BOPWTG C-BOP AEP increaseOPEX (disc.)

€ cent/kWh 5€ cent/kWh

Based on the SWT-6.0-154 turbine; Offshore project 1.000MW

OPEX• Scaling of WTG rating• Optimization of Setup

Foundation• Industrialized designs• Quayside completion

WTG++• Industrialization• Installation & commissioning

AEP• Wider rotor diameters• Improved aerodynamics

Grid• New cost efficient solutions• Industrialized components

Offshore CoE Targets, Wind farm level Main avenues per Cost segment

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A new yardstick is needed –Society‘s Costs of Electricity (SCOE)

Background

• Judging electricity sources only by LCOE stems from ages where electricity production was by definition big-scale and localized at load centers

• With new energy sources entering the scene, this approach falls short.

Objectives

• Analyze supplementary factors in addition to LCOE which affect the true cost of electricity on a macro-economic level

• Provide a comprehensive background for fact-based and objective decisions on the future energy mix

• Base all calculation on acknowledged methods

Social Impact

Economy & employment

Geopoliticalrisks

Environmental impact

Transmission needs

Variabilitycompensation

TrueLCOE

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The decision of the future energy supply should be based on the total cost of energy to society.

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From a macroeconomic perspective wind energy withnatural gas as back-up is the least expensive option