CZECH REPUBLIC Joined the EU on May 1, 2004 16.2.2019 Joined the EU on May 1, 2004 Signatory to the Kyoto Protocol Target renewable energy share in 2010 : 8% Additional RES capacity to be built to meet the target : 3.7 TWh/yr Biomass accounts for 80% of the country RES potential Phytomass Thermal Power Plant - 10 MWe

RES promotion in the Czech Republic 16.2.2019 The Czech Government supports new RES erection through Subsidized renewable electricity prices Five-year tax holiday Direct subsidies Emission reduction units revenue New RES Promotion Law in the context of full liberalization of the electricity market in 2006, expected to get passed this year, introducing the „green certificates“ concept EU Structural Funds and other internal programs Indirect support (human resources, SMEs, farming, …) Phytomass Thermal Power Plant - 10 MWe

The Project Pilot project Steam condensing Rankin-Clausius power plant 16.2.2019 Pilot project Steam condensing Rankin-Clausius power plant 10 MWe net electricity supply Main fuels: energy plants and grain straw Supplementary fuels: wood chips, food crop waste, … Location: Industrial site in the outskirts of Hradec Kralove, Czech Republic Phytomass Thermal Power Plant - 10 MWe

Key Parameters Boiler rated heat output 42 MWt 16.2.2019 Boiler rated heat output 42 MWt Turboset rated capacity 12 MWe Projected capacity utilization 80 % Gross electricity production 84 100 MWh/yr Net electricity supply 70 000 MWh/yr Fuel consumption 83 500 t/yr Fuel average heat value 14 GJ/t Emmision reductions 80 000 tCO2/yr Phytomass Thermal Power Plant - 10 MWe

Financial Parameters (€ mn) (may change substantially after the technology supply tender completion) 16.2.2019 Investment budget 15.8 Initial working capital 1.1 Annual revenues 5.8 (assuming the electricity price CZK 2.50 per kWh, with electricity sales at the bottom of the expected range and with zero CO2 emission reduction revenues) Annual operating costs 3.7 Operating Profit 2.1 Phytomass Thermal Power Plant - 10 MWe

Current State of the Project 16.2.2019 Suitable piece of land secured Positive master planning decision obtained Technology supply tender announced Building permit application being prepared, the permit to be obtained by the end of 2004 Czech Government grant applied for EU structural funds grant application being prepared Negotiations with equity investors on-going Phytomass Thermal Power Plant - 10 MWe

Fuel Supply – Energy Plants 16.2.2019 Major fuel source in the long run Hectare yield: 10 to 15 t/ha Cropped area to fully cover the facility fuel demand: 8 000 ha Ideal use of the land redundant for the food production The market in the Czech Republic to be established yet Phytomass Thermal Power Plant - 10 MWe

Fuel Supply – Grain Straw 16.2.2019 Major fuel source in the first few years Current oversupply in the Czech Republic expected to grow in the view of the latest state agricultural policy developments New bio-ethanol promotion legislation => straw as a waste Phytomass Thermal Power Plant - 10 MWe

Fuel Supply Current Contractual Position 16.2.2019 Preliminary agreements with ca 150 farmers and a wholesale contractor cover the initial fuel demand for a full capacity operation Long term deliver-or-pay agreements pre-agreed, to be executed after the facility construction commencement Fuel auction to establish the biomass fuel market to maintain optimal market prices in the long run Phytomass Thermal Power Plant - 10 MWe

The Site 2.3 ha industrial site plot on the outskirts of 16.2.2019 2.3 ha industrial site plot on the outskirts of Hradec Kralove, Czech Republic In the ownership of EGST Master planing decision issued May accomodate up to 3 units of the projected size in the future Phytomass Thermal Power Plant - 10 MWe

The Site - Infrastructure 16.2.2019 Nearby 110/6 kV switching station, 200 m from the plot border ! Two railway sidings Favourable road-access location Sufficient gas, electricity, water and sewage capacity in place No conflicts with the adjacent land owners and satisfactory result of the hydro-geological, emission dissemination, noice etc. studies. Phytomass Thermal Power Plant - 10 MWe

Project Developer EGST, s.r.o. 16.2.2019 EGST, s.r.o. Main activities: turn key deliveries, design, assembly, revision work and consultancy in the field of protection, control and signalling technologies for energy facilities of all voltage levels, automation of the related processes No. employees: 40 Annual turnover: EUR 1,2mil. Phytomass Thermal Power Plant - 10 MWe

Other Stakeholders Ministry of Environment of the Czech Republic 16.2.2019 Ministry of Environment of the Czech Republic Czech Environment Fund Ministry of Industry and Trade of the Czech Republic CzechInvest EBRD IFC Commercial banks Equity investors Phytomass Thermal Power Plant - 10 MWe

Financial Model 16.2.2019 Phytomass Thermal Power Plant - 10 MWe

Financial Model - case 1 16.2.2019 This case is pessimistic variant of the Financial Model IRR > 15 % Phytomass Thermal Power Plant - 10 MWe

Financial Model - case 2 16.2.2019 This case is optimist variant of the Financial Model IRR > 30 % Phytomass Thermal Power Plant - 10 MWe

Contacts EGST, s.r.o. Vsehrdova 293/28 500 02 Hradec Kralove 16.2.2019 EGST, s.r.o. Vsehrdova 293/28 500 02 Hradec Kralove Czech Republic http://www.egst.cz Tel: ++420 49 5532 998 Mr. Zdenek Tetrev, Mananging Director tetrev@egst.cz Mr. Ales Mitterko, Project Manager mitterko@egst.cz Leonard Beitler, Financial Advisor Na Orechovce 47 162 00 Praha 6 Tel.: ++420 602 315 102 , Fax: ++420 233 343 562 leonard@nextra.cz Phytomass Thermal Power Plant - 10 MWe