Enron North America Principal Investments Review of Charter

Enron North America - Principal Investments Review of Charter Overview of 4 Q 2000 - Outlook for 2001 Meeting on 22 February 2001

Enron North America - Principal Investments Technology Investment Committee 2 Review of Charter Mission: Competitive Advantages: l Exploit competitive market advantages of ENE to achieve asymmetric yields on comparatively small capital investments; l Facilitate ENE business expansion by targeting investment in companies that are complementary to ENE’s core operating strategy; l Expand ENE’s “network” of knowledge and opportunities by providing strategic insight into trends in the industry. l Knowledge Base - existing and future intellectual capital within the Enron organization - in the form of expertise and experience - in a variety of energy and risk management sectors - allows for competent assessment of the return potential of new investment opportunities; l Enron Brand - image/reputation in market, which makes Enron a preferred strategic and financial partner and provides preferred access to investment opportunities. l Enron Global Network - vast resource of commercially savvy professionals who interact daily with a) investment banks, b) VC firms and c) energy companies. DOWNSTREAM POWER TECHNOLOGY Targeted Sectors: • Distributed Generation - Fuel Cells - Microturbines • UPSTREAM POWER TECHNOLOGY • Turbine Technologies • Trading & Risk Management • Transmission and Distribution Technologies • Liquids Technologies - Gas to Liquids Technology - Infrastructure Automation • Pulp & Paper Technologies • Coal/Emissions Technologies • Pipeline Technologies • Other natural extensions to Enron’s existing businesses Power Quality - Uninterruptible Power Systems - Power Semiconductors • (Customer Care, Workforce Mgmt. , Building Automation) - Geographic Information Systems - Superconductors and Applications Power Control & Measurement - Load Mgmt (Hardware & Software) • H: presentaPI_Charter_VS 3. ppt HVAC Technologies OTHER ENRON RELATED TECHNOLOGY • Utility Outsourcing

Enron North America - Principal Investments Portfolio at 31 -Dec-2000 H: presentaPI_Charter_VS 3. ppt Technology Investment Committee 3

Enron North America - Principal Investments Portfolio at 31 -Dec-2000 (con’t) H: presentaPI_Charter_VS 3. ppt Technology Investment Committee 4

Enron North America - Principal Investments Technology Investment Committee 5 Major Earnings Events - 2000 1) Quanta Services, Inc. • Quanta is a leading provider of specialized contracting services, delivering end-to-end design, installation, repair and maintenance solutions for all types of utility infrastructure. • Acquisition of convertible preferred stock representing a fully diluted 19. 9% interest for $49. 4 MM. Deal closed in September 1998. • In September 1999, Quanta entered into a strategic alliance with Utilicorp United, which included the sale by Quanta to Utilicorp of $186 MM of a different class of preferred securities Enron’s entire stake sold to Utilicorp in May 2000 for $206. 0 MM Gain of $156. 6 MM over 19 months; IRR = 150% • • 2) Active Power, Inc. 3) Verado Holdings, Inc. H: presentaPI_Charter_VS 3. ppt • Active Power designs, manufactures and markets battery-free, flywheelbased power quality products that provide the consistent, reliable electric power required by today's digital economy. • $5. 0 MM investment, representing fully diluted interest of 3. 0%, completed in November 1999. • Company completed IPO at $17. 00 per share on 08 -Aug-2000. Share price closed at $52. 75 on first day of trading. • • • Position was sold into Raptor for $66. 0 MM on 08 -Aug-2000. Liquidation of position commenced in 01/2001 - will conclude by year end Gain of $61. 0 MM over 7 months; IRR 5, 000% • Decline of $23. 7 MM in value of 3, 000 warrants not sold in transaction with Texas Pacific Group in 1999. Decline tracked precipitous fall in VRDO share price over year, from $17. 00 at IPO to $0. 65 at year end. Total earnings from Verado = $104 MM

Enron North America - Principal Investments Technology Investment Committee 6 Major Earnings Events - 2000 (continued) 4) Other Revaluation of Portfolio Positions: • Dais-Analytic (+ $6. 9 MM) Revaluation from $60 to $120 MM ($3 MM to $9. 9 MM) based on LG equity investment @ $146 MM • Encorp, Inc. (+ $12. 1 MM) Revaluation from $20 MM to $80 MM ($3 MM to $15. 1 MM); Series D round of $38 MM completed @ $100 MM • MTC (+ $1. 1 MM) Revaluation from $37. 8 MM to $45 MM based on $15 MM Series E round with Aqua International Partners • Fuel. Cell Energy (+ $0. 5 MM) Screen @ 31 -Dec-01 (+ $0. 7 MM) Sold to Calpine Corporation for $43 MM Dispositions • H: presentaPI_Charter_VS 3. ppt Power Systems Mfg

Enron North America - Principal Investments Technology Investment Committee 7 4 Q 2000 Completed Investments 1) Tridium, Inc. • • • 2) i. Medeon • Leading provider of web-based workforce commerce solutions to enable and optimize workforce operations and to make customer service a competitive advantage. • $4. 6 MM investment (initial 6. 75% stake) • • Warrants for an additional 0. 9% GE Equity, Insight Capital, Aether co-invested in this round (Endesa S. A. of Spain also wanted in) IPO in 2002 - final exit 180 days later • 3) AMPS - Advanced Mobile Power Systems, LLC • • • H: presentaPI_Charter_VS 3. ppt Framework, software and services company whose main product is used in the building automation, industrial automation and energy management markets $10. 0 MM investment (initial ~18% stake) EES is material customer and provided guidance in due diligence Company seeking to conclude strategic alliance with Johnson Controls, which would involve a $5 -10 MM investment in next funding round Exit via IPO in 2002 or through trade sale (e. g. Cisco) Design and manufacture of (initially) two 22 MW mobile generating units using Pratt & Whitney FT-4 jet engine 85% ownership interest; sell down to Pratt & Whitney being negotiated Partner is Dispersed Power, LLC (spin off from Power Systems Mfg, LLC) Initial units to be put into service by Enron or sold to third parties (we have received numerous inquiries) Longer term, want to expand product line and become provider of distributed generation solutions for both utilities and commercial customers Exit via IPO in 2002/03 or through trade sale (e. g. Calpine)

Enron North America - Principal Investments Technology Investment Committee 1 Q 2001 Completed Investments 1) Silicon Power • • • 2) Solo Energy • • 3) Encorp • • • H: presentaPI_Charter_VS 3. ppt Leading US manufacturer of high power semiconductors required by industrial, utility, transportation and military applications $2. 5 MM investment (~ 3. 4%) - no warrants Bank of America Securities has been selected as advisor and lead underwriter for IPO, which is projected for 1 H 2001 GE Equity, Wexford Capital co-investing in $10 MM round Exit 180 days post-IPO $2. 25 MM (of total $7. 0 MM) convertible bridge loan plus warrants to purchase 2. 75 MM shares at attractive valuation. Funds needed to fund company’s overhead while negotiating potential acquisition of Elektryon, which designs and distributes POWR/MSTR 100 k. W genset. Loan is senior, secured and due at 30 -Jun-01; converts at ENE’s option into Solo’s Series D round, which should close upon consummation of the acquisition (investors are identified); Acquisition should accelerate IPO into 2 H 2001; high level of banker interest Add-on investment of $5. 0 MM in $38 MM Series D pre-IPO round @ $100 MM pre-money with ratchet to $50 MM if IPO not completed by 31 -Dec-01 at pre-money valuation of $340 MM Funds are sufficient to keep company liquid through middle of 2002 Company generated 10. 2 MM in sales in 2000 (vs. budget of $6. 0 MM) and is targeting $32 MM in 2001 and $78 MM in 2002. Intense dialogue between ENA/EES and Encorp - no sourcing deals yet, but outlook promising Numerous potential trade buyers if IPO does not materialize 8

Enron North America - Principal Investments Technology Investment Committee 9 Targeted 2001 Investments 1) Syntroleum Corp. • • 2) Ramgen Power Systems • • 3) Europe • • • H: presentaPI_Charter_VS 3. ppt Syntroleum has developed a proprietary process for converting natural gas into synthetic oil, which is the basis for its planned 10, 000 bbl/d facility to be constructed in northwestern Australia $20. 0 MM investment for ~ 13% of project equity plus warrants to purchase 1. 3 million Syntroleum shares (~ 4. 8% fully diluted stake); stake in Australia project becomes convertible into ~ 4. 2% of Syntroleum common shares one year after start-up (2004). Project is being heavily subsidized by Australian state and federal government; Merrill Lynch advising on structuring and placing requisite project debt Ivanhoe Energy of Canada providing additional $20 MM in equity Has developed and tested the Ramgen engine, a unique application of well -established ramjet technology to the stationary generation of power Possible applications within AMPS or elsewhere within EES Has completed 2 rounds of funding for $14 MM; has hired CSFB to do 3 rd round of $30 -40 MM in 1 H 2001 Exit 180 days post-IPO OPRA - has developed a 1. 6 MW gas turbine utilizing a patented low emission combustion system; Proton-Motor Fuel Cell Gmb. H - one of the leading European enterprises specialized in PEM fuel cell technology, their elements and system components and integration and control; Vigor Gmb. H - new energy saving technology that can reduce electricity consumption of single and three phase electric motors by 20 -50%

Enron North America - Principal Investments Technology Investment Committee Targeted 2001 Investments 4) Power Line Communications (PLC) • • H: presentaPI_Charter_VS 3. ppt Enikia - has developed high speed networking technology and products which allow up to 10 Mbps data transfer rate. Inari - has developed MAC/PHY 2 Mbps Powerline Network Controller. DS 2 - European front-runner in development of chipsets for powerline communication applications. Itran - has developed mixed-signal chip sets for home networking applications 10

Enron North America - Principal Investments Technology Investment Committee 2001 Anticipated Timeline u Utiliquest (Trade Sale @ Enterprise Value = $66 MM) Potential ENE Write-Off = $4 MM u Solo Energy(1) (3 rd VC funding round for ~ $30 -50 MM @ $90 pre) Potential ENE Gain = $15 MM u Syntroleum Corp (1 st Project Equity Round) ~ $20 MM Potential ENE Gain = $20 -30 MM u Tridium (2 nd VC funding round for ~ $15 MM @ $75 M pre) Potential ENE Gain = $8. 6 MM u MTC (3 rd VC funding round for ~ $20 MM @ $80 MM pre) Potential ENE Gain = $2. 5 MM u Encorp u Dais-Analytic(2) (IPO @ $250 - $500) Potential ENE Gain: $20 -65 MM (3 rd VC funding round for ~ $30 MM @ $120 MM pre) Potential ENE Gain = $0. 0 MM u Solo Energy(1) (IPO @ $500 - $750 MM) Potential ENE Gain = $60 -110 MM u Dais-Analytic (IPO @ $500 - $750 MM) Potential ENE Gain = $50 -90 MM u Tridium (IPO @ $200 MM pre) Potential ENE Gain = $17 MM u Encorp(3) (4 th VC funding round for ~ $38 MM @ $100 M pre) Potential ENE Gain = $1. 5 MM u i. Medeon, Inc. (IPO @ $250) Potential ENE Gain = $15 -20 MM u Fuel. Cell Energy u Sale of 0. 5% stake Active Power, Inc. (952, 382 shares, 324, 000 warrants) Liberation on 03 -Feb-01 (1) Solo currently negotiating combination with Elektryon, which would push VC 3 rd round into 2 Q, but would accelerate IPO (2) $6. 9 MM gain taken in 4 Q 2000. (3) $12. 1 MM gain taken in 4 Q 2000. 1 st Qtr H: presentaPI_Charter_VS 3. ppt 2 nd Qtr 3 rd Qtr 4 th Qtr 2002 11

Enron North America - Principal Investments Technology Investment Committee 12 2001 Market Environment Relative Sector Performance in 2000 Consensus: B of A Individual Share Performance 1. IPO Market will remain closed to technology stories for at least 1 Q, possibly 2 Q 2. Private market valuations and deal structures have become more conservative and provide increased downside protection 3. Energy technology should rebound before internet/communications sector, probably in 2 Q or 3 Q, as the onset of summer again highlights the need for new power delivery technologies 4. Companies with solid business models should be able to achieve IPO in 2 H 2001, however timing remains uncertain 5. Energy technology segment continues to attract high level of interest on Wall Street and increasingly - the venture capital market. H: presentaPI_Charter_VS 3. ppt

Enron North America - Principal Investments Technology Investment Committee Portfolio Statistics Number of Investments: 15 $$ Invested: $80. 1 million @ 21 -Feb-2001 Number of IPO’s 1 (Active Power 1) Number of Trade Sales: 4 (Destec, Quanta Services, First. World 2, Power Systems Mfg, LLC ) Number of Write-Offs: 0 Number of Write-Downs: 0 Outstanding Investments: 14 Portfolio Hedged Value: $186. 1 @ 21 -Feb-01 Portfolio Current Trading Value: $128. 3 @ 21 -Feb-01 Margin Generated: $128. 1 MM (2000) $ 97. 8 MM (1999) $ 80. 4 MM (1998) 1) Active Power completed IPO on 08 -Aug-00. ENA PI is subject to 180 day lock-up period which expires in Feb 2001. Gain of $62. 3 MM has been hedged through “Raptor” vehicle. 2) Bulk of First. World position was sold to Texas Pacific Group in April 2000 for $129 MM. ENA PI retains ownership of 3. 0 MM warrants with strike price of $3. 0 per share. H: presentaPI_Charter_VS 3. ppt 13

Enron North America - Principal Investments Technology Investment Committee Why we like this space • Big push to increased power quality and reliability • Digital economy intolerant of grid level power quality/reliability • Fossil fuel being replaced by electricity as fuel of choice in information economy • Internet continues to pervade “old economy” • Expansion in generation capacity will increasingly be on a distributed basis • Smaller increments, closer to the end user • Deregulation and regulatory uncertainty will incentivize private sector to develop their own power solutions independent of the grid • Electricity infrastructure will (quickly) become increasingly networked • Grid/peak shavers/standby • Differentiated pricing will require real time metering • Monitoring, control and measurement technologies will become mission critical • Energy technology market estimated to total $50 billion within the next 5 years and $100 billion by 2010 • Investment in energy tech at same stage as investment in telecoms in 1986 • Enron uniquely positioned to capture value - based on name/reputation and commercial and technical capabilities H: presentaPI_Charter_VS 3. ppt 14

Enron North America - Principal Investments Technology Investment Committee Charter / Strategy in Current Environment • Energy Tech is here to stay - increased investor attention focused on energy technology sector will not go away anytime soon • All major Wall Street firms have dedicated research and corporate finance teams focused on segment • Targeted energy tech funds have become popular (Ballentine, Perseus/GE, Merrill Lynch, Nth Power, Bank Sarasin, etc. ) • Market recognizes importance of technology in improving/maintaining electricity infrastructure • Private valuations and deal structures have become more investor friendly • Substantial pools of capital have retreated from the technology VC market; those who stay the course have an outstanding opportunity to consolidate their position and pick up some bargain investments • Status of Enron as a preferred “strategic” investor based on reputation and position in energy markets has been enhanced • Need to exploit current market to round out portfolio on a selective basis and cement our position as partner of choice in energy technology area • Achievement of 2001 budget heavily dependent on rebound in IPO market for technology companies • 1 -2 scheduled IPO’s comprise bulk of anticipated margin • Investment strategy for 2001 • No fundamental change in charter necessary • Focus should be on selectively adding to portfolio where we see value • Heightened vigilance in reviewing new investments in order to fully exploit: • Cyclical downturn in public equity markets • Substantial decrease in liquidity in private markets - leading to less aggressive valuations and deal structures that provide substantial downside protection • Enhanced value of Enron as marquee investor H: presentaPI_Charter_VS 3. ppt 15