U.S. Market Update for the Wind Energy Industry

ewec2010 Warsaw Europe’s Premier Wind Energy Event U.S. Market Update for the Wind  Energy Industry By: Frank A. Hoffman, Esq. Krieg DeVault LLP 128...
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ewec2010 Warsaw Europe’s Premier Wind Energy Event

U.S. Market Update for the Wind  Energy Industry By:

Frank A. Hoffman, Esq. Krieg DeVault LLP 12800 N. Meridian Street, Suite 300 Carmel, Indiana 46032 USA (317) 238-6240 (Direct) (317) 636-1507(Fax) (317) 750-6625 (Mobile) [email protected]

By:

Mathew E. Conrad, Esq. Krieg DeVault LLP 12800 N. Meridian Street, Suite 300 Carmel, Indiana 46032 USA (317) 238-6326 (Direct) (317) 636-1507(Fax) (317) 407-8686 (Mobile) [email protected]

April 20, 2010

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Presentation Purpose: To communicate to you that at this moment when one balances current improved economic conditions, continuing government support through economic development incentives and pending legislative policy for the Wind Industry, there is no better time then now to pursue Wind Energy Turbine and Component Part Manufacturing in Indiana, U.S.A. To access this Presentation and related source materials go to: http://www.kriegdevault.com/events/221.html

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Bio – Frank A. Hoffman

Frank A. Hoffman is a partner in the law firm of Krieg DeVault LLP located in Indianapolis, Indiana with offices in Chicago, Illinois and Atlanta, Georgia (www.kriegdevault.com). He concentrates his practice in creative and complex federal, state, and local incentive-based financing transactions and closely-held business organizations. Mr. Hoffman presently co-chairs the Firm’s efforts to implement The American Recovery and Reinvestment Act of 2009 (“ARRA”). Tax Incentive Financing Experience • Created the New Markets Tax Credit Program for the Indiana Bankers Association and its 180 member banks - 2004 $50 million Allocation • Assisted in the creation of the New Markets Tax Credit Program for the city of Fort Wayne – 2008 $15 million Allocation • Assisted in the creation of the New Markets Tax Credit Program for the town of French Lick and seventeen (17) participating southern Indiana counties – 2009 $50 million Allocation • Represents ten (10) other Indiana units of government developing new market Tax Credit Programs • Combined Indiana CRED Credit, Local TIF Bond and NMTC to fund $5.5 million start-up manufacturing plant (Marion, Indiana) • Combined local TIF Bond and NMTC to fund $20 million hotel/indoor waterpark facility (French Lick, Indiana) • Closed over $150 million in NMTC financing (2004 to present) • Created the Wind Energy Manufacturers Associations, Inc. to attract capital investment under ARRA to Indiana in 2009 • Obtained over $28 million in ARRA economic development incentives and $53 million in permanent financing for Indiana startup wind turbine component part manufactures since February 2009 Education DePauw University Indiana University School of Law Admitted to Indiana Bar

B.A., (Economics), June, 1979 J.D., (Taxation); January, 1982 1983, Indiana

Birth Place: Evansville, Indiana, September 1, 1957 High School: Andrean Catholic High School, Merrillville, Indiana; 1975

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Bio – Matthew E. Conrad

Matthew E. Conrad is an attorney with the law firm of Krieg DeVault LLP located in Indianapolis, Indiana with offices in Chicago, Illinois and Atlanta, Georgia (www.kriegdevault.com). He concentrates his practice in the areas of financing transactions (including tax incentive based financing), real estate and mergers and acquisitions. Mr. Conrad represents numerous community development entities and assists with the deployment and administration of a multi-million dollar federal tax credit allocation.

Education Taylor University Indiana University School of Law Admitted to Indiana Bar Admitted to Florida Bar

B.A., (Finance and Accounting), 2000 J.D., 2002 2002 2003

Birth Place: Berne, Indiana High School: South Adams High School, Berne, Indiana

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Why Invest in the Indiana and U.S. Market Now?

I. U.S. Economy & Fiscal Challenges II. U.S. Policy and 2010 Comprehensive Energy & Climate Legislation – Jobs! Jobs! Jobs! III. Wind Potential in the United States (Updated 2/19/2010) IV. 2010 AWEA U.S. Wind Industry Annual Market Report – Year Ending 2009 (Released April 8, 2010)

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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United States Current Economic Outlook Moderate Economic Recovery

Federal Reserve Chairman Ben S. Bernanke before The Joint Economic Committee of the U.S. Congress (April 14, 2010): "Supported by simulative monetary and fiscal policies and the concerted efforts of policymakers to stabilize the financial system, a recovery in the economic activity appears to have begun in the second half of last year." “[F]urther economic expansion will depend on continued growth in private final demand." "On, balance, the incoming data suggest that growth in the private final demand will be sufficient to promote a moderate economic recovery in the coming quarters."

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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CBO’s Economic ForecastsCalendar Years 2009 To 2010

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Key “Risks” Going Forward – Government Debt

Key risks for continued economic growth in the U.S. arise from the possibility of fiscal and monetary policy mistakes. As last year’s Federal fiscal stimulus and monetary policy winds down later in 2010 and 2011, there will be decisions to be made on how to fund repayment of the ever growing U.S. Government Debt. Current policies have the U.S. Government Debt on a direct path to an “entirely foreseeable debt crises.”

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Key “Challenges” Going Forward In The U.S. – Sustainability Of The U.S. Fiscal Position

Federal Reserve Chairman Ben S. Bernanke before the Joint Economic Committee of the U.S. Congress (April 14, 2010): “In addition to the near-term challenge of fostering improved economic performance and stronger labor markets, we as a nation face the difficult but essential task of achieving longer-term sustainability of the nation’s fiscal position. The federal budget deficit is on track this year to be nearly as wide as the $1.4 trillion gap recorded in fiscal year 2009. To an important extent, these extremely large deficits are the result of the effects of the weak economy on revenues and outlays, along with the necessary actions that were taken to counter the recession and restore financial stability. But an important part of the deficit appears to be structural; that is, it is expected to remain even after economic and financial conditions have returned to normal.”

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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CBO Reports – U.S. Fiscal Policy Unsustainable

Congressional Budget Office (CBO) Director, Douglas Elmendorf Speech in Washington, D.C. at Christian Science Monitor Breakfast (April 8, 2010): “U.S. fiscal policy is unsustainable, and unsustainable to an extent that it can’t be solved through minor changes”

During his speech, Elmendorf noted “a recent CBO report that pegged an increase in the public debt from $7.5 trillion at the end of 2009 to $20.3 trillion at the end of 2020 if President Barack Obama’s fiscal 2011 budget were to be implemented as proposed.” As a percentage of gross domestic product, the debt would rise from 53 percent to 90 percent as forecasted by the CBO. Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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How Can The U.S. Put Its Finances In Order?



Increase GDP Growth Rate



Reduce the Growth of Government Spending and Debt



Increase the Tax Burden

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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President Obama’s First Target – U.S. Health Costs: A Problem For A Long Period Of Time

Source Organization for Economic Cooperation and Development, OEDC Health Data, 2008 (Paris: OECD, 2008)

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Health Costs: Room To Cut International Comparison

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Healthcare Costs: Room To Cut Health Professionals Compensation

Source: American Wind Energy Association U.S.Data Wind Industry Annual Market Report – Year Ending 2009 Source: Congressional Research Service, OECD Health 2006

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U.S. Healthcare Costs: Room To Cut Specialty Doctor Compensation

According to these models, the U.S. position above the trendline indicates that specialists are paid approximately $50,000 more than would be predicted by the high U.S. GDP. General practitioners are paid roughly $30,000 more than the U.S. GDP would predict, and nurses are paid about $8,000 more. The Recent Patient Protection and Affordable Care Act passed by Congress in the first step towards reducing health care professional compensation and other health expenditures in the United States.

Source: American Wind Energy Association U.S.Data Wind Industry Annual Market Report – Year Ending 2009 Source: Congressional Research Service, OECD Health 2006

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President Obama’s Second Target: U.S. Taxes Burden Room to Increase

Source Organization for Economic Cooperation and Development data for 2008

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Wage Tax Burden: Room To Increase

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Consumption Tax Burden: Room To Increase

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Paul Volcker: VAT and Energy Related Taxes on the Table

NEW YORK (Reuters) Steven C. Johnson and Leah Schnurr report: The United States should consider raising taxes to help bring deficits under control and may need to consider a European-style value-added tax, White House Adviser Paul Volcker said on Tuesday April 6 2010. Volcker, answering a question from the audience at a New York Historical Society event, said the value-added tax "was not as toxic an idea" as it has been in the past and also said a carbon or other energy-related tax may become necessary. Though he acknowledged that both were still unpopular ideas, he said getting entitlement costs and the U.S. budget deficit under control may require such moves. "If at the end of the day we need to raise taxes, we should raise taxes," he said.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Obama Creates Bipartisan Debt Commission “Taking on the Impossible” ABC News Sunlen Miller reports on February 18, 2010: Aiming to address "long-term quandary of a government that routinely and extravagantly spends more than it takes in," President Obama today signed an Executive Order creating the bipartisan National Commission on Fiscal Responsibility and Reform. “Without action, the accumulated weight of that structural deficit of everincreasing debt will hobble our economy, it will cloud our future, and it will saddle every child in America with an intolerable burden,” Mr. Obama warned from the Diplomatic Reception Room, “Since the budget surpluses at the end of the 1990s, federal debt has exploded. The trajectory is clear and it is disturbing.” Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Obama’s Debt Commission

The Debt Commission will have 18 members, and will be charged with creating recommendations for Congress to balance the budget, excluding interest on the debt, by 2015. Any recommendations must be approved by at least 14 of the 18 members. Six members, including at least two nonDemocrats, will be appointed by the president, and the rest will be appointed by Congress, with an even split between appointments by the majority and the minority. The White House announced Tuesday March 30, 2010 that The Debt Commission will hold its first meeting on April 27, 2010. House speaker Nancy Pelosi and Senate Majority Leader Harry Reid have promised to put recommendations from the Debt Commission to a vote before the end of the current session of Congress. Former Democratic Clinton White House Chief of Staff Erskine Bowles and former Republican Senator Alan Simpson of Wyoming will co-chairs the commission.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Obama's Approval Rating Sinks After Health Care Overhaul Passes

The Associated Press reported on Friday April 16 2010: WASHINGTON – Opposition to President Barack Obama's health care law jumped after he signed it – a warning to Democrats running for re-election this fall that his victory could become their liability. A new Associated Press-GfK poll finds Americans oppose the health care remake 50 percent to 39 percent. Before a divided Congress finally passed the bill and Obama signed it last month, public opinion was about evenly split. Disapproval for Obama's handling of health care also increased from 46 percent before the bill passed to 52 percent currently – a level not seen since last summer's angry town hall meetings. The poll also showed Obama's overall approval rating was below 50 percent.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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The Battle For Capitol Hill – 2010 Senate

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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The Battle For Capitol Hill – 2010 House

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Tea Party Movement – Cut Government Spending

New York Times/CBS News Poll (April 15, 2010): •

“Tea Party supporters are wealthier and more welleducated than the general public, and are no more or less afraid of falling into a lower socioeconomic class”



18% of Americans identified themselves as supporters of the Tea party movement.



When asked “What should be the goal of the Tea Party Movement?:

% Selected 45% 6% 6% 7% 9% 7% 18% 3%

Answer Reduce Federal Government Cutting Budget Lowering Taxes Electing their own candidates Creating jobs Something else All of them No answer

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Post Election “Lame Duck Session”?



2010 Congressional Election: November 2, 2010



2010 Congressional Session Ends: January 3, 2011



61 Days Post Election



December 24, 2009 Christmas Eve U.S. House and Senate passed Health Care Legislation



Spending Cuts and Tax Legislation requires “50 + 1” votes in the Senate and 216 votes in the House



Policy Legislation (e.g. Comprehensive Energy & Climate Bill) requires 59 + 1 votes in the Senate and 216 votes in the House

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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President Obama endorses push for Senate Comprehensive Energy & Climate Legislation

Darren Samuelsohn, E&E reporter (04/16/2010): "President Obama's top aides assured environmentalists Thursday, April 15, 2010 the administration supports a surge this spring or summer to pass comprehensive energy and climate change legislation in the Senate. White House chief of staff Rahm Emanuel and deputy chief of staff Jim Messina gave the green light during a West Wing meeting with the heads of several advocacy groups, including the Sierra Club, League of Conservation Voters and Environmental Defense Fund, according to multiple sources familiar with the meeting. "That's all anyone has been looking for," said one environmentalist. The meeting at the White House comes as the three leading Senate authors -- John Kerry (D-Mass.), Lindsey Graham (R-S.C.) and Joe Lieberman (I-Conn.) -- edge closer to releasing long-awaited legislation that would put a price on greenhouse gases across multiple sectors of the economy, while also expanding domestic oil, gas and nuclear power production. Senate staff said the plan was to unveil the bill April 26, while Kerry and Lieberman said they were working on the logistics of lining up people to attend the introduction ceremony.'

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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House Has Already Passed Carbon Cap-and-Trade Legislation BUSINESS WEEK by Dan Beucke Reported on June 26, 2009 : June 26,2009 will go down as an historic moment in world’s efforts to tackle climate change. For the first time, a Congressional body passed legislation that would place mandatory limits on the emissions of the greenhouse gases that cause global warming. By the barest margin of 219 to 212, the House of Representatives voted for a bill spearheaded by Representatives Henry Waxman (D-Calif.) and Edward Markey (DMass.). If it becomes law, the measure would require a massive switch to cleaner sources of energy over the next four decades. “This is the landmark energy and environmental legislative achievement of a generation,” says Phyllis Cuttino, director of the Pew Environment Group’s U.S. Global Warming Campaign. American Clean Energy and Security Act of 2009 sets forth provisions concerning clean energy, energy efficiency, reducing global warming pollution, transitioning to a clean energy economy, and providing for agriculture and forestry related offsets. ACESA provisions include: (1) creating a combined energy efficiency and renewable electricity standard and requiring retail electricity suppliers to meet 20% of their demand through renewable electricity and electricity savings by 2020; (2) setting a goal of, and requiring a strategic plan for, improving overall U.S. energy productivity by at least 2.5% per year by 2012 and maintaining that improvement rate through 2030; and (3) establishing a cap-and-trade system for greenhouse gas (GHG) emissions and setting goals for reducing such emissions from covered sources by 83% of 2005 levels by 2050. Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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North Carolina Senator Lindsey Graham Pushes Forward Bipartisan Comprehensive Energy & Climate Legislation

U.S. Senator Lindsey Graham (R-South Carolina) made the following statement in a Press Release in Washington D.C. on January 27, 2010: "The energy legislation that was passed by the Senate Energy and Natural Resources Committee is not strong enough to lead us to energy independence. The climate change legislation passed by the House of Representatives and Senate Environment and Public Works Committee is too onerous on business and does not enjoy bipartisan support. "My goal is to continue working with Senators Kerry, Lieberman and my Senate colleagues to create a new pathway forward that focuses on a more robust energy security package and a more business-friendly climate legislation. “ "I am committed to finding a new way forward as I believe energy security is a short and long-term job creator for our country. Clean air is a shared value by both parties and all Americans. I remain hopeful after discussing this matter with conservation groups, businesses, and Senate colleagues we can be successful this year." It is anticipated that the proposed draft of “KGL” Comprehensive Energy & Climate Legislation will be released the week of April 26, 2010.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Graham floats “Clean Energy” Standard as climate talks continue

The Hill by Ben Geman reports on February 17, 2010: Senator Lindsey Graham (R-S.C.) hopes to revive a plan that Republicans have floated as an alternative to proposed renewable electricity mandates: A broader “clean energy” standard that includes nuclear power and low-emissions coal too. Graham has written draft legislation that would require utilities to supply escalating amounts of electricity from “clean” sources, beginning at 13 percent in 2012 and reaching 25 percent in 2025 and 50 percent in 2050. “Clean” power includes renewable sources like wind, solar and biomass. Power from coal plants that trap and sequester carbon dioxide and new nuclear plants would also count under the plan. Graham is trying to craft a compromise climate and energy bill with Sens. John Kerry (D-Mass.) and Joe Lieberman (I-Conn.). Graham spokesman Kevin Bishop said Graham’s work on the “clean energy” bill began before his collaboration with Kerry and Lieberman got underway.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Why & How Can U.S. Include Clean Coal in a “Clean Energy Standard”? List of Global Coal Reserves

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Location of United States Coal Reserves

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Coal Reserves - Details

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Coal Dependant States

Ranking of selected US states for dependency on coal for electricity production and for total consumption. Figure 1.- high-dependency states. . Image Source: American Wind credit: USEIA data, graphic by J.Energy Laumer Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. Coal Jobs

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Enhanced Oil Recovery: How to Make Money from Carbon Capture and Storage Today

Scientific American by David Biello reported on April 9, 2009: The U.S. oil business has been using carbon dioxide to pump extra oil out of reservoirs for 36 years--and permanently storing some CO2 in the process The Scurry Area Canyon Reef Operators Committee oil field, better known as SACROC, near Snyder, Tex., has slurped 140 million metric tons of liquid carbon dioxide (CO2) since 1972—80 million metric tons of which has stayed trapped in the reservoir. Pumping all that CO2 down has meant pumping more oil out. For 36 years, oil services companies like Denbury Resources and Kinder Morgan have piped carbon dioxide from naturally occurring reservoirs in Colorado to the declining oil fields of the Permian Basin in West Texas. The U.S. has at least 100 such projects like SACROC and 3,100 miles (5,000 kilometers) of CO2 pipelines. All told, companies have injected some 10.8 trillion cubic feet of the greenhouse gas since the 1970s, according to petroleum engineer R. Tim Bradley, Kinder Morgan's president of CO2, to raise the yield from oil fields by some 650,000 extra barrels a day—more than 10 percent of daily U.S. total production.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Indiana Senator Richard Lugar Releases Practical Energy Plan Outline

On March 30, 2010, Senator (Republican, Indiana) Dick Lugar released a draft outline of the practical energy legislation he will introduce that would meet many climate improving goals, without cap and trade, by conserving energy and saving people, businesses and government money. Goals: Reduce foreign oil dependence Save Americans money on their energy bills Improve competitiveness Diversify and clean-up power sources In a letter to fellow Members of Congress, Senator Lugar wrote: As you know, I have long been concerned about America’s energy security, in particular our over-reliance on foreign oil. Without aggressive action to decrease our long-term energy dependence on foreign sources, we are risking economic and security disasters, as well as even more severe trade imbalances and costs for consumers.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Indiana Senator Richard Lugar Releases Practical Energy Plan Outline

Lugar wrote in his March 30, 2010 letter to others in Congress:

By focusing on policies that reduce foreign oil need, target achievable energy efficiency, and boost diversity in domestic cleaner power generation, the enclosed plan would generate the following savings by 2030, according to preliminary analysis: • • • •

Foreign oil dependence would be cut by two-thirds; National energy consumption would fall by 14%; Average household electric bills would be reduced by 10%; and Greenhouse gas emissions would be cut by 25%, or about two billion metric tons.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Dependence on Foreign Oil and The Price of Oil

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Indiana Senator Bayh Calls for Provisions to Strengthen American Manufacturing Competitiveness

Senator Evan Bayh of Indiana issued a press release on Thursday April 15, 2010 In Washington D.C that Nine Senators Outline Priorities To Promote American Manufacturing And Job Creation Through Energy Legislation: The nine U.S. Senators wrote to Senators. Kerry, Lieberman, and Graham calling for provisions to address manufacturing competitiveness that must be included in any clean energy legislation. The letter, led by Senator Brown, outlines essential provisions necessary for clean energy legislation that strengthens American manufacturing competiveness, creates new opportunities for clean energy jobs, and creates a level playing field for domestic manufacturers. “Our nation’s economic future depends both on our global competitiveness and access to reliable energy sources,” the Senators wrote. “We must not allow our nation to become dependent on foreign clean energy industries or squander the opportunity to compete successfully in the global clean energy marketplace. A strong manufacturing base is crucial if the United States is to build the clean energy technologies of the future and achieve energy independence.” The letter calls for a multi-pronged strategy to maintain and strengthen our industrial base and the millions of manufacturing jobs that are critical for our economic recovery.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Senators Mandating Assistance To Support U.S. Manufacturing

Invest in American Manufacturing Competiveness: •

Provide Assistance for Retooling and Clean Energy Manufacturing. Due to the financial crisis, many American manufacturers are struggling to obtain the capital necessary to make critical investments in energy efficiency or for necessary retooling to diversify into new clean energy products such as wind turbines, solar panels, and advanced vehicles. These investments are essential to create jobs, maintain a strong and competitive manufacturing base, and establish the U.S. as a leader in the manufacturing and production of clean energy. We propose financial assistance mechanisms that include: establishing a manufacturing revolving loan fund, expanding the 48C advanced energy manufacturing tax credit, providing tax incentives to encourage capital investments in efficiency and clean energy technology, and investing in domestic production of advanced vehicles and components. Paired with technical assistance from an expanded Manufacturing Extension Partnership program and Industrial Assistance Centers, these funds would help manufacturers expand into new markets, reduce their energy costs, and ultimately create and retain highly-skilled, good-paying manufacturing jobs here in the United States.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Senators Mandating Assistance To Support U.S. Manufacturing

Invest in American Manufacturing Competiveness:



Support Research, Development, and Deployment of Low-Carbon Industrial Technologies. For American manufacturers to compete globally, they must develop and adopt more affordable and reliable clean energy technologies than those that exist today. This major industrial transformation will require substantial federal support through public-private partnerships. A national initiative for low-carbon industrial technology would support the transition to a clean energy economy and create new economic opportunities for U.S. manufacturers. This initiative would improve the efficiency and global competitiveness of domestic manufacturers and reduce carbon emissions, particularly process-related emissions, in a commercially viable manner while helping small, medium, and large manufacturers meet these goals.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Senators Mandating Assistance To Support U.S. Manufacturing

Invest in American Manufacturing Competiveness:



Support American Manufacturers of Clean Energy Technologies. Several federal programs exist to promote the production and use of clean energy sources. Linking clean energy incentives to domestic manufacturing will both create immediate good-paying manufacturing jobs in the domestic economy and enhance the innovation and competitiveness of firms located in the U.S. These programs should recognize and prioritize the use of domestically produced products and materials.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Indiana The Most Manufacturing Intensive State in the U.S Manufacturing’s Share of Total GDP in Indiana MSAs

Source: IBRC, using data from the Bureau of Economic Analysis, 2008.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

45

Industries with the Largest Positive and Negative Contributions to Indiana's Real GDP Change, 2008

Source: IBRC, using data from the Bureau of Economic Analysis, 2008

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Indiana's Compensation by Industry, 2007 – Manufacturing #1

Source: Bureau of Economic Analysis

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Jobs! Jobs! Jobs!

U.S. Unemployment Report, March 2010

Rate

Over the Year Loss

United States

9.7%

Indiana

9.9%

38,700

Michigan

14.1%

96,500

Ohio

11.4%

147,000

Illinois

11.5%

148,500

8.8%

74,800

Wisconsin

Source: Bureau of Economic Analysis

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Jobs! Jobs! Jobs!

Great Recession Total U.S. Jobs Deficit As of February, 2010 Total Jobs Lost:

8.4 million

Total New Job Demand:

2.7 million

Total U.S. Jobs Deficit:

Source: New York Times Editorial (3/16/2010) citing Bureau of Economic Analysis

11.1 million

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Potential Wind Manufacturing Jobs at 10% RES

Type of Analysis

Assumes a 10% Renewable Generation Requirement and the Development of 50,000 MW of Wind Power in the United States to determine impact of Wind Turbine Component part and assembly manufacturing jobs.

Total Investment in Wind Turbine Component Parts and Assembly (based on $1 billion per 1000 MW)

$50,000,000,000 (AWEA)

Wind Manufacturing Jobs Rotor (28%)

42,000

Nacelle and Controls (21.7%)

32,550

Gearbox and Drive Train (17.3%)

25,950

Generator and Power Electronics (7.0%) Tower (26%)

10,500 39,900

Total (100%)

150,000 (AWEA)

Number of Wind Manufacturing Jobs to be located in the Midwest (ND, SD, NE, KS, MN, IA, MO, WI, IL, IN, MI and OH)

30,639 (AWEA)

Percentage of Wind Manufacturing Jobs to be located in the Midwest:

20.43%

Number of Wind Manufacturing Jobs to be located in Indiana

8,317 (AWEA)

Percentage of National Wind Manufacturing Jobs to be located in Indiana:

5.0545%

Percentage of Midwest Wind Manufacturing Jobs to be located in Indiana

27.145%

Percentage of National Population located in Indiana

2.098%

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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Jobs! Jobs! Jobs!

“Clean Energy Standard” = U.S. Manufacturing Jobs

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

51

Current Renewable Portfolio Standards State by State www.dsireusa.org / April 2010 WA: 15% x 2020*

MN: 25% x 2025

MT: 15% x 2015 OR: 25% x 2025

(Xcel: 30% x 2020)

SD: 10% x 2015 WI: Varies by utility;

10% x 2015 statewide

IA: 105 MW CO: 30% by 2020 (IOUs)

10% by 2020 (co-ops & large munis)*

CA: 33% x 2020

UT: 20% by 2025*

NH: 23.8% x 2025 MA: 22.1% x 2020 New RE: 15% x 2020 (+1% annually thereafter)

x 2015*

5% - 10% x 2025 (smaller utilities)

NV: 25% x 2025*

New RE: 10% x 2017

MI: 10% + 1,100 MW

ND: 10% x 2015

(large utilities)*

ME: 30% x 2000

VT: (1) RE meets any increase in retail sales x 2012; (2) 20% RE & CHP x 2017

KS: 20% x 2020

NY: 29% x 2015

RI: 16% x 2020 CT: 23% x 2020

OH: 25% x 2025†

IL: 25% x 2025

PA: ~18% x 2021†

WV: 25% x 2025*†

NJ: 22.5% x 2021

VA: 15% x 2025*

MD: 20% x 2022

MO: 15% x 2021

AZ: 15% x 2025

DE: 20% x 2020* NC: 12.5% x 2021 (IOUs)

DC

10% x 2018 (co-ops & munis)

NM: 20% x 2020 (IOUs)

DC: 20% x 2020

10% x 2020 (co-ops)

TX: 5,880 MW x 2015 HI: 40% x 2030

State renewable portfolio standard State renewable portfolio goal Solar water heating eligible

Minimum solar or customer-sited requirement

*†

Extra credit for solar or customer-sited renewables

29 states + DC have an RPS

Includes non-renewable alternative resources

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

(6 (6 states states have have goals) goals) 52

Current Renewable Energy Standards State by State Population – RES States: >75%

VIRGINIA, 7,882,590 WASHINGTON, 6,664,195 NEW JERSEY, 8,707,739 NORTH CAROLINA, 9,380,884

MICHIGAN, 9,969,727

ARIZONA, 6,595,778

MASSACHUSETTS, 6,593,587 MISSOURI, 5,987,580

MARYLAND, 5,699,478 WISCONSIN, 5,654,774

OHIO, 11,542,645

MINNESOTA, 5,266,214

COLORADO , 5,024,748

PENNSYLVANIA, 12,604,707

OREGON, 3,825,657 CONNETICUT, 3,518,288 IOWA, 3,007,586 KANSAS, 2,818,747 UTAH (GOAL ONLY) , 2,784,572

ILLINOIS, 12,910,409

NEVADA, 2,643,085 NEW MEXICO, 2,009,671 WEST VIRGINIA ( GOAL ONLY), 1,819,777 NEW HAMPSHIRE, 1,324,575 MAINE, 1,318,301 HAWAII, 1,295,178 NEW YORK, 19,541,453 RHODE ISLAND, 1,053,209 MONTANA, 974,989 DELAWARE, 885,122 SOUTH DAKOTA (GOAL ONLY) , 812,383 NORTH DAKOTA (GOAL ONLY), 646,844 VERMONT ( GOAL ONLY) , 621,760 DISTRICT OF COLUMBIA, 599,657

TEXAS, 24,782,302

Less Than 25% NON RES STATES, 65,949,007

CALIFORNIA, 36,961,664

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

53

National Renewable Energy Laboratory – AWSTRU Wind New U.S. Land Wind Potential 300% Higher Than Previously Estimated

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

54

Land Wind Energy Potential – Installed Capacity – Top 15 States

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

55

Land Wind Energy Potential - Installed Capacity Top 15 States as of February 4, 2010

Wyoming 5%

Oklahoma 5%

New Mexico 5%

Minnesota 5% Colorado 4%

Iow a 5%

Illinois 2% Indiana 1%

North Dakota 7%

Wisconsin 1% Others States 6%

South Dakota 8%

Texas 19%

Nebraska 9%

Montana 9%

Kansas 9%

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

56

Off-Shore Development Potential Also Increases

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

57

The Five Great Lakes – 245,200 KM2

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

58

AMERICAN WIND ENERGY ASSOCIATION U.S. WIND INDUSTRY ANNUAL REPORT - YEAR ENDING 2009

A number of the following presentation slides were recently release by the American Wind Energy Association (AWEA) on April 8, 2010. Graphics and text in these slides can only be used with proper citation of "U.S. Wind Industry Annual Market Report Year Ending 2009." Creation of new graphics or other use of the data contained in the AWEA report must by approved in writing by AWEA. You may access the American Wind Energy Association Wind Industry Annual Market Report Year Ending 2009 at http://www.awea.org/membercenter/login.html

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. WIND INDUSTRY ANNUAL MARKET REPORT FAST FACTS Over 10,000 MW of wind was installed in 2009, the largest year in U.S. history, keeping the U.S. as the global leader in wind power. Current U.S. wind power capacity is over 35,000 MW. Wind provided 39% of all new generating capacity in 2009. 14 states are in the “Gigawatt Club” with more than 1,000 MW of capacity installed – 36 states now have utility-scale wind projects. Top Wind Power Owner: NextEra Energy Resources Utility With Most Wind Power on System: Xcel Energy Top U.S. Wind Turbine Supplier: GE Energy Wind energy provided 1.8% of U.S. power in 2009. The wind industry supported 85,000 jobs across all 50 states in 2009. There were 39 new, announced or expanded manufacturing facilities in 2009, and the total number of online facilities is well over 200. There are now nine different turbine manufacturers with manufacturing facilities in the U.S. Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

60

U.S. ANNUAL AND CUMULATIVE WIND POWER CAPACITY GROWTH

The U.S. wind industry broke all previous records by installing over 10,000 megawatts (MW) of new generating capacity in 2009, equivalent to 3 new nuclear plants. Total wind installed, including small wind turbines, reached 35,086 MW at the end of 2009.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

61

GROWTH OF U.S. WIND POWER CAPACITY

The five-year average annual growth rate for the industry (2005-2009) is now 39%, up from 32% between 2004 and 2008. As annual installations have doubled twice in the last three years, the five-year annual growth rate continues to increase. The volatility in this chart in the early 2000s reflects the strong effect that on-again, offagain tax policy had on the market.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

62

PERCENTAGE OF NEW CAPACITY ADDITIONS

For the past five years, wind power has been one of the largest new sources for electricity generating capacity, second only to new natural gas units. In 2009, wind power provided 39% of all new generating capacity installed. Since 2005, wind power and other renewable energy technologies, combined with natural gas, have provided over 90% of all new generating capacity in the U.S.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

63

CHANGE IN U.S. GENERATION MIX

Renewable generation has increased from 2.1% to 3.6% over the past 5 years. In 2009, coal-fired generation was 45%, a drop from 48% in 2008. Natural gas generation gained market share with 23% generation in 2009, up from 20% in 2008.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

64

U.S. GENERATION MIX

Wind generation is approaching the two percent mark of the U.S. power mix, reaching 1.8% of U.S. generation in 2009. This is an increase from 1.3% of generation at the end of 2008. All renewable energy sources provided 10.5% of the U.S. power mix in 2009. With the significant increase in renewable energy capacity over the past several years, the power mix is reflecting a slow but steady shift toward renewable energy.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

65

U.S. WIND POWER INDUSTRY TIMELINE

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

66

U.S. REMAINS GLOBAL LEADER IN WIND INSTALLATIONS

The U.S. maintained its position as global leader in installed capacity in 2009, growing to over 35 GW after becoming the world leader in total wind capacity in 2008. Total global wind power capacity is now over 150,000 MW.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

67

TOP COUNTRIES IN ANNUAL WIND ADDITIONS

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

68

ANNUAL GROWTH RATES

Overall, the U.S. growth rate for wind power has exceeded the growth rate for the rest of the world for the past four years. In 2008, the U.S. growth rate was more than double that of all other markets.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

69

U.S. WIND POWER CAPACITY INSTALLATIONS BY STATE State-by-state, the U.S. continued to see strong growth in Texas and the Northwest. One up-and-coming area of growth in 2009 was the Midwest states of Indiana and Illinois. Texas again installed the largest amount of new capacity, driving it past the 9,000-MW mark in total installations. Iowa now has a total of 3,670 MW installed, consolidating its position as #2, behind Texas and ahead of California. With several large wind farms added, Washington and Oregon pulled ahead of Minnesota to round out the top five states.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

70

PERCENTAGE OF GENERATION

At the end of 2009, there were 6 states that receive more than 5% of their electricity from wind. Iowa is the first state to exceed 10% wind energy generation on an annual basis, reaching 14.2% wind energy generation in 2009.

Percentage of wind generation compared to all generation in state as reported in DOE EIA Electric Power Monthly Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

71

WIND POWER CAPACITY INSTALLED BY STATE

In 2009, there were fourteen states in the “Gigawatt Club” with more than 1,000 MW installed – 1 GW. In 2009, new club members included Illinois, Indiana, Kansas, New York, Oklahoma, North Dakota, and Wyoming.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

72

CHANGE IN CAPACITY DISTRIBUTION OVER TIME, BY STATE

Wind power installations are becoming diversified across the country from California, which had virtually all the country’s wind power capacity until the late 1990s. Thirty-six states, including Arizona for the first time, now have utility-scale wind installations and 14 have more than 1,000 MW of wind power capacity.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. LEGISLATIVE DISTRICTS WITH MOST WIND POWER INSTALLED

Legislative District

Wind Power Capacity Installed (MW)

Texas-19 Rep. Randy Neugebauer (R)

4,145

Texas-11 Rep. Mike Conaway (R)

2,901

Iowa-4 Rep. Tom Latham (R)

2,412

Oregon-2 Rep. Greg Walden (R)

1,758

Minnesota-1 Rep. Timothy Walz (D)

1,316

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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CAPACITY ADDITIONS BY STATE, QUARTERLY

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

75

2009 U.S. WIND POWER PROJECT LOCATIONS

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

76

INSTALLED WIND CAPACITY BY INTERCONNECTION

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

77

WIND IN TRANSMISSION INTERCONNECTION QUEUE, BY REGION

Nationwide, nearly 300,000 MW of proposed wind projects have applied for interconnection to the electric grid but have not yet been connected. The large number of wind projects in the interconnection queues provides an indication that the nation’s electric grid is currently inadequate for accommodating the demand for wind energy. This is particularly apparent when the size of the interconnection queues is compared to the number of transmission projects moving forward in the near future.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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TOP 20 WIND POWER OWNERS IN U.S.

NextEra Energy Resources continues to lead ownership of wind assets in the U.S., with over 7,400 of the over 35,000 MW installed. Eight other companies now own over 1,000 MW of wind power assets, up from five last year. The top five companies own about 49% of the total U.S. fleet, down from 53% last year.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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U.S. WIND POWER OWNERSHIP DIVERSIFYING OVER TIME

The trend in wind asset ownership is diversification, however. NextEra Energy esources now owns about 21% percent of all U.S. wind power assets, down from over 40% through the end of 2004.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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NEW CAPACITY ADDERS IN 2009, BY OWNER

In terms of new capacity additions for 2009 alone, Iberdrola Renewables gained the top spot.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

81

LARGEST WIND FARMS, BY MW

The Horse Hollow Wind Farm was surpassed as the country’s largest wind farm in 2009, when the final phase of E.On Climate & Renewables’ Roscoe Wind Farm came online. The project was built in four phases, named Roscoe, Champion, Pyron and Inadale. Together, it has 627 turbines and a combined generating capacity of 781.5 MW. Over 400 landowners received lease payments to host the turbines. The Roscoe Wind Farm can produce enough power for the equivalent of 250,000 average U.S. homes. The six largest wind farms in the U.S. are now located in Texas.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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AVERAGE WIND PROJECT SIZE. MW

The average project size in 2009 was about the same as in 2008 – about 75 MW per project.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

83

NUMBER OF PROJECTS INSTALLED BY YEAR

138 projects were added in 2009, up from 10 a decade ago.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

84

NEW TRANSMISSION LINES PROPOSED

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

85

OFFSHORE WIND PROJECTS PROPOSED IN U.S.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

86

OFFSHORE TURBINE SPECIFICATIONS

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

87

UTILITY OWNERSHIP OF WIND POWER CAPACITY

Electric utility MidAmerican Energy (including PacifCorp) leads all other U.S. utilities in terms of ownership of wind assets. Utility-owned projects accounted for about 15% of all the capacity installed in 2009, a rate consistent with the past few years.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

88

INVESTOR-OWNED UTILITY USAGE OF WIND POWER

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

89

MUNICIPALLY-OWNED UTILITY USAGE OF WIND POWER

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

90

RURAL ELECTRIC CO-OPERATIVE UTILITIES’ USAGE OF WIND POWER

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

91

AVOIDED CO2 EMISSIONS FROM WIND

In 2010, when the new wind projects installed throughout 2009 produce power for a full year, the entire U.S. wind fleet will avoid over 62 million metric tons of CO2, the equivalent of reducing power sector emissions by more than 2.5%, or taking over 10.5 million cars off the road.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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ANNUAL WATER CONSUMPTION AVOIDED FROM THERMAL POWER PLANTS

By directly reducing the use of fossil fuel generation, wind energy can also help reduce the consumption of water. Water is used for the cooling at thermal (natural gas, coal, and nuclear) power plants. The majority of water withdrawn for cooling is recycled back through the system. However, approximately 2% to 3% of water can be lost through evaporation. This evaporation ranges from 100 to over 500 gallons per MWh for fossil fuel units.

The reduction in output of fossil power plants due to wind generation in 2009 led to water consumption savings of over 15 billion gallons of water. When all new wind projects installed throughout 2009 produce power for a full year in 2010, this savings will increase to over 20 billion gallons per year.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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MANUFACTURERS’ SHARE OF 2009 INSTALLATIONS IN U.S.

GE Energy continues to lead the wind turbine manufacturer rankings. 2009 brought more diversity to the U.S. wind turbine market. In 2005, there were five utility-scale turbine manufacturers with equipment installed in 2005. In 2009, that number had tripled.

The top three manufacturers retained the same position as last year. In 2009, the top eight turbine manufacturers accounted for 96% of all new capacity added in the year, down slightly from 98% in 2008. Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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MANUFACTURERS’ SHARE OF TOTAL

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

95

MAKERS OF TURBINES INSTALLED OVER PAST FIVE YEARS

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

96

AVERAGE WIND TURBINE CAPACITY

Utility-scale turbines continued to gradually grow larger. Over 5,600 turbines were installed in 2009, bringing the total to over 33,000 turbines. The average capacity for new turbines added in 2009 was 1.75 MW, up from 1.67 MW in 2008

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

97

DISTRIBUTION OF TURBINES INSTALLED IN 2009 BY CAPACITY

The 1.5-MW turbine is still the most popular in the U.S. by far.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

98

INCREASE IN WIND TURBINE PRODUCTIVITY

Utility-scale turbines are not just getting bigger – they are getting better, too. A typical turbine installed in 1990 had a nameplate capacity of 250 kW but, because of low capacity factors and low availability, produced about 300,000 kWh per year. Over two decades, the technology has improved to the point where availability to generate is usually above 98% and taller towers and better siting technology have enabled project owners to achieve capacity factors in the high 30% and low 40% annually in the best wind resource areas. A turbine with a nameplate capacity six times larger can produce more than 14 times more power.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

99

SIZES AND MATERIAL USE FOR UTILITY-SCALE TURBINES INSTALLED IN 2009

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

100

TURBINE MODELS INSTALLED IN 2009

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

101

ALL ONLINE WIND MANUFACTURING FACILITIES

The manufacturing sector for the wind industry has grown significantly in the past several years, adding, announcing or expanding over 100 facilities since 2007. Currently, over 200 facilities across the U.S. supply to the wind industry, and this figure does not capture the many additional facilities at the sub-supplier level. Wind manufacturing facilities can be found in every region of the United States.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

102

NEW WIND MANUFACTURING FACILITIES IN 2009

While 2009 was a strong year for announced manufacturing facilities, it is down significantly from 2008. In 2008, 58 facilities came online, were announced or expanded, compared to 39 in 2009 and 24 in 2007. These 100 new, announced or expanded facilities since 2007 represent over $2.5 billion in investment and over 19,000 wind manufacturing jobs that will be brought online as the industry grows

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

103

NUMBER OF FACILITIES EACH YEAR

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

104

2009 FACILITIES BY TYPE

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

105

MAJOR FACILITY LOCATIONS

Both the blade and tower sectors have previously seen substantial growth, with 20 tower facilities (of which two came online in 2009) and 13 blade facilities currently online. As these sectors are fairly well developed, the number of announced facilities is small in proportion to the number already online. On the other hand, the number of new facilities announced in 2009 for turbine manufacture, which includes nacelle assembly by an original equipment manufacturer (OEM) and sometimes blade or tower manufacture, was equal to those already online. This is a reflection of growing domestication of the supply chain for the wind industry.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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TOTAL U.S. WIND INDUSTRY EMPLOYMENT

At the end of 2009, wind industry employment remained steady with 85,000 Americans employed directly and indirectly by the wind industry. Compared to 2008, the construction sector employed an additional 500 workers in 2009 due to increased installation of new wind turbines. Operations and management jobs also grew by 1,000 over the previous year. However, due to many turbines on the market in 2008 and the credit crisis, 1,500 manufacturing jobs were lost in 2009.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

107

WIND INDUSTRY JOBS BY STATE

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

108

ACADEMIC INSTITUTIONS OFFERING WIND ENERGY PROGRAMS, BY TYPE

As the wind industry grows, employing 85,000 people today, ensuring a skilled workforce across all aspects of the wind industry is a top priority. As of February 2010, 205 educational programs offered a certificate programs, degree program, or coursework related to wind energy. The programs offered specific to wind include wind turbine technician training, electrical engineering, mechanical & aeronautical engineering, science & technology, project management, policy, and many other programs. AWEA’s Education Programs Database is available on the AWEA website at www.awea.org/education.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

109

GROWTH OF U.S. SMALL WIND MARKET

Despite an economic downturn, the U.S. market for small wind turbines – those with rated capacities of 100 kW and less – grew 15% in 2009 with 20 MW of new capacity. This growth equates to nearly 10,000 new units and pushes the total installed capacity in the U.S. to 100 MW.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

110

SMALL TURBINE MARKET GROWTH (U.S.) BY TURBINE SIZE

The growth of the market segments of < 1-kW units, 1- to 10-kW units, and 11- to 100-kW units has changed over the years, with the 11- to 100-kW segment now the largest segment in terms of new capacity installed. In the previous two years, the 1- to 10-kW segment was the largest.

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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KRIEG DEVAULT OVERVIEW







For clients throughout the Midwest and across the country, Krieg DeVault provides clear, practical legal advice that takes in the big picture without losing sight of the details. That's how we approach your legal challenges and how we deliver solutions that are focused on your needs, your business and your world. While much has changed since Krieg DeVault's founding in Indianapolis, over 130 years ago, our commitment to listening to our clients has not. Client satisfaction and loyalty have allowed us to grow from a two-lawyer general practice in the mid-1870s to our current status as a premier business-focused law firm. From offices that reach from the nation's heartland to the Sun Belt, we are ideally positioned to serve the needs of our diversified client base. Financial institutions, global manufacturers, national healthcare providers, successful organizations of various sizes and market focus, as well as individuals all rely on us for solutions that create success. They know their important cases, sophisticated transactions, and complex business issues require the big picture approach that has become a Krieg DeVault hallmark. "Clients expect us to help them achieve their goals. They entrust us with their most important legal matters. At Krieg DeVault, we never take that trust for granted. We learn our clients' businesses; we communicate openly, we follow up frequently; we respond timely; and we are always available. In short, we develop a relationship with our clients. Our clients' goals become our goals." Michael E. Williams, Managing Partner

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

112

KRIEG DEVAULT GLOBAL AFFILIATION

Meritas. Law Firms Worldwide. No matter what their legal needs, we can ensure that our clients are well represented in jurisdictions around the world thanks to Krieg DeVault’s invitation-only affiliation with Meritas. One of the world’s largest and most respected legal resources, Meritas is an integrated, non-profit alliance of more than 170 independent commercial law firms located in over 60 countries. That means no fewer than 6,500 experienced lawyers are available to our clients worldwide. Unsurpassed Advantages As a Meritas member, Krieg DeVault can offer our clients a wealth of advantages not available through even the largest multinational law firms. Meritas member firms, including our own, must meet rigorous service standards and undergo regular recertification to ensure that all client inquiries are answered within 24 hours, to demonstrate compliance with the highest ethical and client satisfaction benchmarks, and to provide alternative dispute resolution options. Member firms are linked by common technology platforms to facilitate cross-border teams, and comprehensive databases provide information on lawyer capabilities and firm client evaluations. International Perspective Meritas members invest in improving services and resources rather than opening costly branch offices. All Meritas firms offer the full complement of litigation and corporate services necessary to handle business matters in any industry. Since Meritas firms are well established in their local markets, our clients have the advantage of a legal partner who knows the nuances of local legal procedures and business customs. When combined with the international perspective of our firm’s own lawyers (who handle multinational matters ranging from dispute resolution to energy and financing transactions), Krieg DeVault’s participation in Meritas gives our clients the global resources they need, coupled with the value and service they want. Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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KRIEG DEVAULT LOCATIONS Working Where Clients Need Us Krieg DeVault lawyers are at work where our clients do business, in major urban centers and dynamic smaller communities throughout the Midwest and Southeast. Some of our offices offer a broad range of legal services, while others are more focused on specific legal needs. They all, however, reflect the firm's commitment and capabilities for achieving solutions to real-world legal issues. Indianapolis Office One Indiana Square Suite 2800 Indianapolis, IN 46204-2079 P: (317) 636-4341 F: (317) 636-1507 Carmel Office 12800 North Meridian Street Suite 300 Carmel, IN 46032-9422 P: (317) 566-1110 F: (317) 636-1507 Noblesville Office 949 E. Conner Street Suite 200 Noblesville, IN 46060 P: (317) 773-7818 F: (317) 773-7918 Schererville Office 833 West Lincoln Highway Suite 410W Schererville, IN 46375 P: (219) 227-6100 F: (219) 227-6101

Mishawaka Office 4101 Edison Lakes Parkway Suite 100 Mishawaka, IN 46545 P: (574) 277-1200 F: (574) 277-1201 Chicago Office 30 North LaSalle Street Suite 3516 Chicago, IL 60602 P: (312) 423-9300 F: (312) 423-9303 Atlanta Office 1230 Peachtree Street NE Suite 2490 Atlanta, GA 30309 P: (404) 607-0600 F: (404) 665-3628 Boca Grande Office 431 Palm Avenue P.O. Box 1911 Boca Grande, FL 33921 P: (941) 964-0018 F: (317) 636-1507

Source: American Wind Energy Association U.S. Wind Industry Annual Market Report – Year Ending 2009

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