1. New Business Model Fiber, Fuel and Energy? Rob Davis Forest Energy Corp BTEC May 25, 2010 Scottsdale, AZ

2. Renewable Energy Wind Solar Geothermal Biomass

3. What is Biomass? Any Organic material not derived from fossil fuel. FERC PURPA ‘80-

4. And then there was politics ‘08 Farm Bill Renewable Fuels Bill BCAP American Power Act Each State Individually Dictating forest or air policy w/ energy policy

5. Do you have biomass? Extra Consistent Supply Consistent Quality Cost Biomass advantage-constant

6. Characteristics Species Forms Bark Slash Hog Fuel Chips Pellets Briquettes

7. Characteristics Moisture Ash Ash Fusion Temp Contaminants Energy Content-Btu

8. Source Where does it come from? Renewable Sustainable Will there be a Recapture of carbon?

9. What can you do with it? Use it Sell it Produce a product Produce an Energy product Fuel Electricity Transportation Fuels Thermal Energy

10. Processing Physical Size Moisture Densifying Doesn’t change energy content, makes consistent and more economical to handle.

11. Processing Pyrolysis Gasification Torrification Hydrolysis Combustion

12. Products Ethanol Hydrogen Methane CO2 Lignin Char

13. Markets – Selling Fuel or Selling Energy? In - House Residential Commercial Industrial Utility

14. Value In – HouseElec, Thermal, CHP ResidentialThermal vs. NG, FO, Prop, Elec CommercialThermal vs. NG, oil, propane, elec IndustrialElec, Thermalvs. NG, coal UtilityElec vs coal

15. Incentives Federal & State Electricity REC Fuels PTC ITC BCAP Moving target even after legislation passes How will it be administered e.g. BCAP

16. Emissions good and bad Particulate - Nox +- Sox + Other - Carbon ?

17. Efficiency The Prudent Use of our Resources Perhaps a move in this direction

18. Economics Biomass Supply - acceptable quality and source Biomass Cost Markets near you Select Process / Product Actual Cost Reliance on incentives

19. Opportunity Low cost of assured biomass supply Renewable demand Lower cost biomass energy Mandates / Incentives / Credits Future Carbon reduction incentives Consolidate resources

20. Rob Davis Forest Energy Corporation Show Low, AZ 928-537-1647 rdavis@forestenergy.com BTEC Biomass Thermal Energy Council 1211 Connecticut Ave NW, Suite 600 Washington, DC 20036-2701 202-596-3974 tel 202-223-5537 fax www.biomassthermal.org