Siemens Energy Service Sector overview John McVey For internal use only / © Siemens AG 2008. All rights reserved.

Health and Safety “Our zero harm philosophy is very clear. It has to be something in the hearts and minds of all our employees that safety comes first - so no matter how big the contract is, how important the customer, or how close the deadline is, we will not compromise and we will not put the health and safety of our people at risk.” Matthew Chinn Managing Director, Energy Sector UK & North West Europe Siemens

Infrastructure & Cities Energy Healthcare Siemens UK Structure Industry Infrastructure & Cities Energy Healthcare Divisions Drive Technologies Industry Automation Service Divisions Mobility Lighting (OSRAM) Power Distribution, Smart Grid Applications Building Technologies Divisions Fossil Power Generation Renewable Energy Power Transmission Oil & Gas Energy Service Divisions Imaging & Therapy Systems Clinical Products Diagnostics Customer Solutions

Fossil Power Generation Siemens Energy Sector Energy products and solutions – in 5 Divisions Fossil Power Generation Renewable Energy Energy Service Power Transmission Oil & Gas

Energy Conversion Chain -

What are we here to do? Page 6

What does the market look like? ESSR ES ESSF Market Skills shortage Conversions Biomass UK Round 3 CCGT New Build Electricity Market Reform Local manufacturing Onshore growth Ageing Fleets Renewables RoadMap Nuclear delays New technologies New Market Entrants LCPD Customers Competition

What differentiates us from our competitors? “One stop shop” Continuing investment within the Service Facility Dedicated Training Centre Excellent safety record Blend of experience and upcoming talent Innovation with a global investment of €4 billion on R&D Drax upgrades Input into new wind turbine product design

Environmental Targets Stakeholder Confidence 3 Main issues driving UK Energy Policy and market reform over the next 10 years Security of Supply Environmental Targets Stakeholder Confidence ¼ Existing generating capacity due to close in next 10 years Reserve margins need to increase due to intermittent supplies Demand could double 2020-2050 15% of energy from Renewables by 2020 34% reduction in carbon emissions by 2020 Further investment to meet LCPD NOx limits £110Bn investment required by 2020 Long-term investor confidence through ‘grandfathering’ Boost market competition Least cost to consumer

UK Round 3 – Wind Proposed Development. offshore-renewable-energy-uk UK Round 3 – Wind Proposed Development. offshore-renewable-energy-uk.pdf … which translates into ~2.000 technicians to be hired… 2018 2016 2022 1.973 2020 1.655 885 294 Impact on Service5) Assumed efficiency factor for NG6 (13-16 MW / technician)3 … and ~100 vessels to be procured for R3 sites 60 20 1) 100 k£ / MW over 20 years 2) Electricity Market Reform, Secretary of State for Energy and Climate Change Chris Huhne 3) Currently 8 MW / technician on nearshore site 4) Stephen Wilson, director of wind and marine at Narec 5) Siemens gain 40-50% market share 10 6 CTV Flotel SOV Jack up

What about the longer term vision? Total Market Development & Service Market ESSR € market size Installed MW 1.500 23.254 25.000 20.000 Strong growth over next 5 years Onshore - 14% p.a. Offshore - 35% p.a. Government aim to attract new investors /developers Increasing competitive OEM market ESSR 1.000 969 795 15.000 645 515 10.000 500 7.275 424 327 251 5.000 2010 2011 2012 2013 2014 2015 2016 On-shore Off-shore Market size MW ESSF € market size Installed MW 1.500 100.000 85.700 90.000 78.500 80.000 ESSF 1.000 70.000 Coal plant closing due to LCPD New build mix of CCGT & biomass Potential conversions of old plant 60.000 681 625 608 615 615 654 50.000 581 40.000 500 30.000 20.000 10.000 2010 2011 2012 2013 2014 2015 2016 TurboCare Siemens Parsons

Newcastle Energy Service Training Centre Replication of “real-life” field conditions and equipment Steam turbine, Gas turbine and Generator technology 2.3 & 3.6MW Variable Speed Nacelles Two training towers (10m and 16m) 15 state of the art classrooms Both technical and safety training courses Accredited graduate and apprentice training programmes Target to become Centre Of Excellence for direct drive wind technology “Supporting the business and our customers”

Thank you