How to optimize the investment for the production of fuels for renewable energy 20/05/2010 rev.00Pavan Consulting S.r.l.1 Bioenergy International Conference Bydgoszcz 17 June 2010 PELLETS UPDATE

SCENARIO AND INVESTMENT THE SCENARIO to be analyzed - trends of society - law, objectives, rules - market of energy of raw materials of fuels of available technologies to produce fuels, but also to use fuels THE SOLUTION – Analysis and decision procedure to optimize the investment. 20/05/2010 rev.00Pavan Consulting S.r.l.2.

20/05/2010 rev.00Pavan Consulting S.r.l.3 The awareness of necessity of responsible behaviour of one single person as well as of social groups, peoples, countries increases every “day”. The awareness the environment can’t be exploited beyond the point that life of future generations is jeopardized The EU decision of 20% reduction of CO2 emissions within 2020 The diffusion of the concept of eco-compatible/eco-compatibleness as important criteria to evaluate: - decisions - behaviours, - policy, - investments - financial support of investments - etc. The use of biomasses to produce energy is in line with the mentioned criteria and in line with the trend “back to nature” WHY BIOMASSES AND GREEN ENERGY ARE SO TRENDY

PELLETS AND BRIQUETTES Use: – Who uses them – How are they used – Where are they used S ustainability: that concept is normally is understood as economical sustainability or cost efficiency but the concept includes other important aspects as well The middle terms market of : – Raw materials – Final products – Technologies 20/05/2010 rev.00Pavan Consulting S.r.l.4

BIOMASSES AS FUELS There are different kind of such biomasses, we focus on: » PELLETS » BRIQUETTES and their use There are two types of use of pellets and briquettes as fuels: - Domestic, normally finalized to heating of houses - Industrial use to generate heat or heat and power Potential users of pellet and/or briquettes are: -Householders Potential users of industrial pellet and/or briquettes are: -Power stations -Industries -Public or private social structures as hospitals, schools, sport and wellness centres etc. -Buildings with centralized heating systems 20/05/2010 rev.00Pavan Consulting S.r.l.5

CRITERIA TO DECIDE THE INVESTMENT The criteria is cost efficiency, evaluated with a strategic middle – long term point of view while keeping in mind: – Environmental compatibility – Environmental efficiency – Energy efficiency – Political decisions to support the income of social groups General compatibility to avoid: » Raw materials price speculations » Negative influences on food and/or raw materials for food availability or price » Availability of final products It means also: Agricultural - forestall – industrial – city wastes are coherent with a vision of environmental compatibility A deforestation finalized to produce solid fuels as well as the substitution of food harvests with energetic harvests are less coherent with a concept of general sustainability and compatibility. 20/05/2010 rev.00Pavan Consulting S.r.l.6

TRENDS OF MARKET DEVELOPMENT Domestic market of Briquettes and Pellets: » develops in relationship with the wish to have single home and/or a fireplace for the briquettes » Has limited availability of wooden raw materials with DIN rules Industrial market of Briquettes and Pellets probably develops faster, because: » Use of biomasses in the power station is encouraged » New investments in industrial and residential buildings take into consideration the green energy » Raw materials variety – availability – price range are wider » Raw material specifications are more flexible 20/05/2010 rev.00Pavan Consulting S.r.l.7

THE PROJECT MANAGEMENT The project management is an analysis system and decision procedure helping to find the most correct relationships between: 20/05/2010 rev.00Pavan Consulting S.r.l.8 Middle term market of - Raw materials - Final products - Technologies Investment: goal Finance: possibilities Investor: expectations

IDENTIFICATION OF RELATIONSHIPS 20/05/2010 rev.00Pavan Consulting S.r.l.9 Wastes and residues from Agriculture Forest Other Raw material Middle and long term Availability Price Quality Quantity Final Products : Pellets + Briquettes Domestic users Industrial users Middle and long term Price Quality Availability Quantity TECHNICAL SOLUTION can be considerate : - As tool to create relationship between both market - As tool to realize your expectations as Investor In relation to time In relation to types

HOW to PROCEDE 20/05/2010 rev.00Pavan Consulting S.r.l.10 Analysis of -Requirements + expectations of investor - Middle term raw materials types + availability - Market requirements - Technical available solutions Interface with -Authorities -Financial institutions for Project financing - Supplier of technologies -Technical proposal - Economical + financial proposal Coordination of: - involved companies - Investor’s team Negotiation Project specification Commissioning

SUPPLIER ROLE Equipment supplier responsible for: – technical efficiency Process line supplier responsible for: – technical efficiency – technological efficiency Process line and engineering supplier responsible for – coordination of different technologies – technical efficiency – technological efficiency Turnkey supplier responsible for: – coordination of different technologies – technical efficiency – technological efficiency – global financial guarantee 20/05/2010 rev.00Pavan Consulting S.r.l.11

For more information, please, contact: MION & MOSOLE I.A.I. S.p.A. Candelù (TV) Italy Agent for Poland: SECOM POLSKA Sp. z o.o Lodz ul. Pilkarska 17 Tel (0) – Fax +48 (0) /05/2010 rev.01Pavan Consulting S.r.l.12