Reducing emissions in the power sector Didier Sire Executive Vice President Strategy at GDF SUEZ Energy Europe April 25 th, 2013

GHG emissions are decreasing thanks to the crisis … not to a strong and effective climate policy The current market conditions are very unfavorable for CO 2 emission reduction – CO 2 prices have collapsed – Existing low-carbon emitting CCGT not competitive with coal plants – No appropriate price signal for low carbon investments – Huge concerns on EU-ETS future since April 16 th The situation of gas is very critical while it should play a key role for environmental policy and security of supply  Gas plants are pushed away of the merit order  Ongoing process of “Mothballing / Decommissioning” of non profitable gas plants Current situation 2 / April 25 th, 2013 As a result

To reach the objective of decarbonisation in the power sector by giving a clear CO 2 price signal leading to promote gas technologies investments US situation illustrates how switching from coal to gas can rapidly and economically contribute to GHG emissions reduction. It means that: – Measures have to be taken in order to keep existing thermal assets with lower emissions in the merit order – Appropriate price and political signals must be sent to investors to allow them to invest in gas In the long term, the energy mix must be balanced with: – RES supported by coordinated, coherent and fair support schemes aiming at a progressive integration into the market of mature technologies. – Gas developed in a well designed and coordinated CRM at European level in order to guarantee the security of the European power system Challenge 3 / April 25 th, 2013

What Europe can bring An improved & coordinated European framework Providing long term visibility for investors Coordinating CRM systems Avoiding “renationalisation” of energy policies A reshaped European climate policy New proposal to enforce a stronger carbon price signal must be urgently studied by policy makers A new market design The EOM is not sustainable for the system and investors are not confident enough to invest An improved & coordinated European framework Providing long term visibility for investors Coordinating CRM systems Avoiding “renationalisation” of energy policies A reshaped European climate policy New proposal to enforce a stronger carbon price signal must be urgently studied by policy makers A new market design The EOM is not sustainable for the system and investors are not confident enough to invest 4 / April 25 th, 2013