Kaliakra Wind PowerKWP Mitsubishi Heavy Industries Ltd INOS

Kaliakra Wind Power（KWP) (Mitsubishi Heavy Industries, Ltd. / INOS 1 OOD) The First Wind Farm Project in Bulgaria 2012 12 Dec 14 th 2012 For the Forum “Invest in Bulgaria” © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved.

MHI Products © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 1

MHI Power Systems © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 2

MHI Wind Turbines © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 3

Project Schema l株主間契約書 Mitsubishi Heavy Industries, Ltd. Sub Loan JBIC (Japan Bank International Corporation) + Mizuho Bank Overseas Investment Credit Non-recourse Finance inos 1 OOD Equity 70% Equity 30% Concession Construction Permit Kaliakra Wind Power AD (Project Company) Regulator (SEWRC) Generation License (Joint Implementation) Emission Reductions Purchase Agreement Japan Carbon Finance Kavarna Municipality EPC Contract Grid Connection Contract Power Purchase Agreement MHI/INOS National Electric Company (NEK) © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 4

Wind Turbine Generator (WTG) MWT 62/1. 0 (MWT-1000 A) Rated output Rotor diameter Rated Rotor rpm Rated wind speed Cut out wind speed : : : 1, 000 k. W 61. 4 m 19. 8 rpm 12. 5 m/s 25. 0 m/s(10 min. Ave. ), 30. 0 m/s(Instantaneous) Survival Wind Speed : 60 m/s Generator Type : Induction, 4 Pole Type Voltage : 690 V(50 Hz) Tower Hub Height : 69 m © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 5

KWP Summary Location : Close to Cape Kaliakra, Kavarna Municipality Capacity: 35 MW (1 MW WTG X 35 units) Operation start: July 2008 Successful operation, mechanical availability in 2011 was 99. 7% Operated by local Bulgarian employees with MHI technical support only in case special maintenance required. Supported by consistent and diligent Bulgarian workers © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 6

KWP Project Development History① 2004 l Site Concession from Kavarna Municipality 2005 l Joint Development Agreement between MHI and INOS l Preliminary Grid Connection Contract signed l Approval of Environmental Impact Assessment by Ministry of Environment and Waters l Shareholders Agreement between MHI and INOS l Establishment of KWP l MOU among MHI, JBIC and JCF © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 7

KWP Project Development History② 2006 New Energy Laws established (feed-in-tariff system introduced) EPC Contract signed Generation License, Construction Permit Issued 1 st Class Investor Certificate Issued 2007 PPA (Power Purchase Agreement) Signed Grid Connection Contract Signed Construction Start (March 2007) 2008 Commercial Operation Start (July 2008) “Investor of the year 2008 awarded” 2010 ERU (Emission Reduction Unit) Transferred © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 8

JI (Joint Implementation) Process Jun 2005 Sep 2005 Dec 2005 Mar 2007 Apr 2007 Jun 2007 Oct 2009 Jan 2010 Apr 2010 Jun 2010 Project Idea Note (PIN) submitted Letter of Endorsement issued Memorandum between Japan and the Republic of Bulgaria on Cooperation under the Kyoto Protocol Emission Reduction Purchase Agreement Signed Public Comment opened Project Design Documents（PDD） and Determination Report submitted National Allocation Plan (NAP) Published including KWP JI Project Letter of Approval by both countries issued JI Track 1 Guideline by Bulgarian Government issued Verification Report Issued Emission Reduction Unit (ERU, for 2008 -2009) Transferred to Japan (Verification Process for 2012 is now on going) © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 9

Key issues for successful investment conditions Consistent and stable legislation for on-going businesses Ø Predictable business environment for investors Ø Transparent and grounded decision making process Ø Compliance with EU directives, regulations, state aid provisions Solving Grid Constrains and Fulfillment of Contractual Obligations by Off-taker(NEK) Ø Compensation agreement for grid curtailment and payment condition to be fulfilled Ø Influence future decision to investors and lenders (Will not be curtailed after new transmission line constructed) Establishment of Sustainable Feed-in-Tariff(FIT) Scheme Basic concept of FIT : Cost sharing by electricity consumers Common issues in many FIT countries Japan can learn from cases in Bulgaria and EU countries Broad public discussion to promote RES is always essential © 2012 MITSUBISHI HEAVY INDUSTRIES, LTD. All Rights Reserved. 10