Dr Mike Binder President CEO 808 Oakcrest Drive

Dr. Mike Binder President & CEO 808 Oakcrest Drive, Champaign, IL 61821 -4170 Office: (217) 352 -0115 Fax: (217) 352 -1552 mikebinder@mikebinderassoc. com Introduction of Fuel Cell Technology Into Developing Countries NHA Annual Hydrogen Conference 2008 Sacramento, CA – Mar 30 -Apr 3, 2008 Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Mission Mike Binder and Associates, Inc. Fuel Cell Consulting Services

International Finance Corporation (IFC) • The private sector affiliate of the World Bank Group • Mission is to promote sustainable private sector investment in developing countries • Acts as executing agency for the Global Environment Facility (GEF), a multilateral finance program housed in the World Bank Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Global Environment Facility (GEF) • Serves as the official financial mechanism for the United Nations Framework Convention on Climate Change (UNFCCC) • GEF’s Operation Program #7: “Reducing the Long-Term Costs of Low Green House Gas (GHG) Emitting Technologies” • GEF Identified fuel cells as a promising technology to be supported under Operational Program #7 Mike Binder and Associates, Inc. Fuel Cell Consulting Services

IFC-GEF Fuel Cell Financing Initiative (FCFI) • Two Stages: $54 million in total funding • Stage 1: $9 million for up to three projects in three GEF eligible countries ($2, 000/k. W up to 50% of capital cost - $3 million maximum per project) • Two awards remaining under Stage 1! • Stage 2: $45 million ($1, 000/k. W – Remaining details to be determined) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Requirements for Fuel Cells in Developing Countries • Close to commercial or fully commercial application (no R&D) • Technology reliability – warranties and serviceability • In-country fuel supply and infrastructure • Policy support for distributed generation • Strong local partners in country • End-users clearly identified Mike Binder and Associates, Inc. Fuel Cell Consulting Services

FCFI Location Requirements • Project must be located in a developing country eligible for GEF financing (http: //gefweb. org/participants/Members_Countri es/members_countries. html) • Country must be a signatory of the UNFCCC (http: //unfccc. int/resource/conv/ratlist. pdf) • Location should be in a geographical region with good potential for fuel cells (replicable and sustainable) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

FCFI Status and Timelines • Currently accepting proposals under a rolling RFP (issued June 2007 – Valid for 18 months or until the additional 2 projects are awarded) • First award issued to the team of IST Holdings Ltd (Pretoria, South Africa) and Plug Power (Latham, NY) in December 2005 Mike Binder and Associates, Inc. Fuel Cell Consulting Services

IST/Plug Power Fuel Cell Project • $3. 0 Million grant to IST/Plug Power • South Africa is host country • 286 Gen. Core 5 -k. W hydrogen-fueled Telecom backup power units • 114 Gen. Sys II 5 -k. W propane-fueled remote Telecom prime power units • Current effort focused on Gen. Core Mike Binder and Associates, Inc. Fuel Cell Consulting Services

South African Telecom Site Characteristics • South Africa grid very unreliable by U. S. standards – Still the best by far in Sub-Saharan Africa • System is old – No new generation allowed in the last 20 years • Numerous refugee camps without electricity, water, or sanitary facilities • Theft of electric power, wire, batteries and gensets common in remote areas Mike Binder and Associates, Inc. Fuel Cell Consulting Services

South African Telecom Site Characteristics • Central sites have larger power requirements (less backup time for given hydrogen supply – Quick to get to) • Remote sites have lower power requirements (more backup time for given hydrogen supply – Takes longer to get to) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

IST Holdings Ltd • Provider of leading edge network solutions and state of the art electronic solutions to the telecommunications industry in South Africa and other Sub-Saharan countries • Role includes sales of fuel cells to customers, installation, maintenance, and coordination of refueling efforts (with AFROX) • Strong interest in fuel cell implementation for 2010 World Cup scheduled to be held in South Africa • Primary Telecom customers are Eskom, Vodacom, and MTN Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Eskom – Cape Town, SA • South African electric public utility • Largest producer of electricity in Africa • Among the top seven utilities in the world in terms of generation capacity • Among the top nine utilities in the world in terms of sales Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Eskom – Cape Town, SA • Traditionally used Ni-Cd and Lead-Acid wet cell batteries as backup for telecommunications control network • Wants to have minimum 12 -hour backup time for their sites (not possible with batteries) • Felt fuel cells needed to be considered as an option to batteries Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Eskom – Cape Town, SA • Had been buying rectifiers for some time from IST – From them learned about Plug Power fuel cell backup power products • Did a demonstration of 48 V output Gen. Core at University of Western Cape – Then moved it to their Hawekwasberg mountain top communications tower site • Installed two 108 V output Gen. Core units at distribution substations Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Hawekwasberg Site • Load just under 2 k. W • Three hydrogen cylinders provide 12 -15 hours backup time • Two banks of 3 cylinders on site • Low-fuel alarm alerts when the first bank of 3 cylinders is empty • Initially Gen. Core served as secondary backup to batteries • Now batteries serve as secondary backup to Gen. Core Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The Eskom Hawekwasberg site is barely visible at the peak of the mountain Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The Eskom Hawekwasberg site Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The Gen. Core fuel cell and battery cabinet at the Eskom Hawekwasberg site Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The backup power battery building at the Eskom Hawekwasberg site. The Gen. Core can replace this entire building Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Typical battery corrosion seen in the Eskom Hawekwasberg backup power battery building. Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Eskom – Cape Town, SA • Planning statistically significant 24 -Gen. Core unit test of the reliability of the hydrogen supply infrastructure • Installation planned at 7 transmission sites, 5 telecom sites, and 12 distribution sites • If results of this test prove satisfactory, Gen. Core will become one of the Eskom standard backup options available to site designers Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Eskom – Potential Fuel Cell Adaptation • 10 -15% of 3, 500 distribution sites • 50% of 1, 000 Telecom sites • Possibly 40% of 250 transmission sites (still being analyzed) • Actual numbers dependent on results of ongoing life-cycle cost analysis • Initial results indicate that new sites are more compelling than refurbishment of existing sites Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – South Africa Gen. Core Units • • Northern Borders West Region – 25 Northern Borders East Region – 0 Gauteng - North Region – 0 Gauteng - South Region – 1 Kwa-Zulu Natal (KZN) – 1 Eastern Cape – 1 Central Region – 1 Western Cape - 3 Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Western Cape • Desires a minimum of 24 hours backup capability • Installed Gen. Core units at 2 different sites in November 2006 (~ 0. 5 k. W demand) • Initially Gen. Core served as secondary backup to batteries • Now batteries serve as secondary backup to Gen. Core Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Western Cape • Planned third demonstration for July 2007 • Sendelingsdrif facility on South Africa/Namibia border • Subject to temperature extremes • Nearest hydrogen depot ~ 750 km away • Averages ~ 200 W demand • Six hydrogen cylinders – 4 -5 days backup • First ever demonstration of Alcatel Compact Base-station Outdoor (CBO)/fuel cell combination Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Alcatel Compact Base-station Outdoor (CBO) System • Very small system • Designed to be used outdoors • Typically communications gear and batteries are housed in the same building • Fuel cell with CBO eliminates need for a building resulting in lowered initial site cost Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The Alcatel CBO and Gen. Core combination under test at Vodacom - Western Region Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Western Cape Strategic Plans • Progressive continuation of fuel cell demonstrations • First applications will be rural/remote sites for which travel time is relatively long (1015 units maximum in this category) • Next will look at nodes (up to 5 sites coexisting in one place) • Last they will look at metro sites (~12 k. W – larger fuel cells would be desirable) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Northern Borders West Region • Experiences numerous power failures in its service territory (~15/month) – frequently of long duration • Fuel cells currently serving as secondary backup to batteries – Eventually batteries will be removed • Electrolyzer technology being considered (would like to see reformer technology) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Northern Borders West Region – Skinner Street Site • Located in downtown Pretoria • Major challenge to IST for installation • Major challenge to IST for refueling Mike Binder and Associates, Inc. Fuel Cell Consulting Services

The Vodacom Skinner Street site is located on the rooftop of an 8 -story building in Pretoria. Mike Binder and Associates, Inc. Fuel Cell Consulting Services

A front view of the Gen. Core installation at the Vodacom Skinner Street site. Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Vodacom – Northern Borders West Region • Very pleased at this time with the results of their fuel cell backup power systems • If fuel cell technology made a standard for Vodacom sites, would retrofit around 60 sites (~10% of total sites) • New sites are added at a rate of ~ 40 -50 per year – Would also employ fuel cells • Would not implement fuel cell technology without assistance of IFC grant! Mike Binder and Associates, Inc. Fuel Cell Consulting Services

MTN • Has historically been more cautious in adopting new technology than have their competitors – Need to gain confidence first • One Gen. Core system test underway • One Gen. Sys system test planned • Primary interest in fuel cells is for Gen. Sys application in Nigeria (Over 2, 000 sites – Soon to be increased to 3, 000 sites) Mike Binder and Associates, Inc. Fuel Cell Consulting Services

New Technology Adoption • Customer selection – Leaders vs. followers • Customer education – Fuel cell basics and potential advantages • Life cycle cost analysis must demonstrate financial viability • Confidence building plan • Budgeting of funds Mike Binder and Associates, Inc. Fuel Cell Consulting Services

New Technology Adoption • Build confidence in fuel cell reliability – Demonstrate minimal number of units (within close proximity) – Fuel cells secondary backup to batteries – Batteries secondary backup to fuel cells – Batteries no longer used Mike Binder and Associates, Inc. Fuel Cell Consulting Services

New Technology Adoption • Build confidence in maintenance infrastructure – Number of demonstration sites increased to obtain statistically significant data – Dispersion of demonstration sites increased • Build confidence in refueling infrastructure – Some demonstrations at very remote sites Mike Binder and Associates, Inc. Fuel Cell Consulting Services

Thank You!!! Mike Binder and Associates, Inc. Fuel Cell Consulting Services