Overview of Energy Industry

1. Population Growth By Region

2. Per Capita Carbon Emissions

3. For Climate Change Skeptics; its not about climate! World GDP Global Carbon Emissions

4. Energy Sources

5. Use of Cars

6. Technology Demands

7. Fossil Fuel Uses

8. Turning to Cities

9. Per Capita Consumption of Energy

10. Energy Consumption by Source

11. Oil

12. What Is Oil Used for Anyway?

13. Oil Demand and Consumption by Nation

14. How many years of oil are left?

15. Hubbert’s Peak

16. Demand for Oil Inelastic

17. Oil Prices

18. Production in Decline

19. World Energy Use by Non-Alternative Fuels and Oil Resources Use by Region

20. How does oil get to us?

21. Oil Sands

22. Natural Gas Reserves by Region

23. Natural Gas Flows

24. Coal Reserves in US

25. Electricity Essential for Economic Growth

26. 26 R e s i d e n t i a l ( n o n e l e c t r i c ) 6 % C o m m e r c i a l ( n o n e l e c t r i c ) 4 % I n d u s t r i a l E l e c t r i c P o w e r ( n o n e l e c t r i c ) 4 0 % 1 7 % T r a n s p o r t a t i o n 3 3 % Source: Cambridge Energy Research Associates. Data source: US Energy Information Administration. 80204-1 Electricity and Carbon Emissions NAP_NAG_ConfCall_040308

27. Electricity is Big Money We Spend About $300 Billion On Electricity Each Year Fuel Generation (Installed MWs) Transmission Distribution Trading & Other $92 Billion Market Value of Fuel Use for Generation $106 Billion Value Added $24 Billion Value Added $67 Billion Value Added $296 Billion (Average Revenue per kWh: $0.081) $7 Billion Value Added COAL 1,038 MM Short Tons ($31 Billion) NATURAL GAS 5,679 Bcf ($51 Billion) 313 GWCoal 386 GWNatural Gas 61 GWPetroleum 100 GWNuclear 98 GWHydro 24 GWRenewables Total: 982 GW OIL 214 Million Barrels ($12 Billion) Annual Consumption: 3,660 TWh NUCLEAR ($5 Billion) FUEL COST DEFERRALS ($7.5 Billion) U.S. Electric Value Chain, 2005

28. National Fuel Mix

29. Aging Infrastructure

30. Cost of Energy Infrastructure Overhaul

31. Thinking about Costs

32. 32 Combustion Turbine Combined Cycle Supercritical Coal Nonfirm Wind Geothermal Biomass Solar CSP Solar PV 50 75 100 125 150 175 200 225 250 275 Levelized Cost of Electricity (2007 dollars per MWh) Source: Cambridge Energy Research Associates. Notes: See next slide for capital cost and operating cost assumptions. Wind utilization rate range is 20–40 percent, and cost range includes PTC benefits. Natural gas price range of $6–$8 per MMBtu assumed for combustion turbine and combined-cycle units. Renewable energy production and investment tax credits included. 80109-5 Levelized Cost of Electricity for Conventionaland Renewable Power Options CERA_NAP_ConfCall_032008

33. Cost of Nuclear

34. Increasing Cost of Electricity

35. Matching Supply and Demand

36. Misaligned Incentives-Regulated Monopolies

37. Undoing Monopolies

38. Misaligned Incentives- IPPs

39. Regional Power Generation

40. 40 Source: GE Power Systems Energy Consulting, The Effects of Integrating Wind Power on Transmission System Planning, Reliability and Operations, a report prepared for the New York State Energy Research and Development Authority, 2004. Used with permission. 80109-6 Wind Output Does Not Match Load CERA_NAP_ConfCall_032008

41. Wind Power in the US

42. 42 1 , 6 0 0 1 , 4 0 0 1 , 2 0 0 O r d e r s 1 , 0 0 0 T u r b i n e T r a n s a c t i o n 8 0 0 P r i c e ( 2 0 0 6 d o l l a r s p e r k W ) 6 0 0 T r e n d L i n e 4 0 0 2 0 0 0 1 9 9 9 2 0 0 7 1 9 9 7 1 9 9 8 2 0 0 0 2 0 0 1 2 0 0 2 2 0 0 3 2 0 0 4 2 0 0 5 2 0 0 6 Source: Lawrence Berkeley National Laboratory database, US Department of Energy. 71108-6 Reported Wind Turbine Prices—United States CERA_NAP_ConfCall_032008

43. Pollution Points

44. Air Pollution

45. Air Pollution Impacts

46. Pollution Controls, Cap and Trade Has Worked

47. 47 New Power Generation Capacity Characteristics and Costs Source: Cambridge Energy Research Associates. Notes: Combustion turbine design basis assumes 2 x 7F, dual fuel capable, nominal 340 MW. Combined-cycle gas turbine design basis assumes 2 x 2 x 1 7F, dual fuel capable, nominal 500 MW, closed-loop wet cooling. Supercritical coal unit design basis assumes nominal 600 MW unit with double reheat. Capital cost figures include owner's costs (development/permitting, land acquisition, construction G&A, financing costs, interest during construction, etc.), but exclude contractor risk premiums. Fixed O&M includes property tax and insurance as well as other fixed operating expenses (labor, maintenance materials, ongoing capital, etc.). Variable production cost includes fuel (natural gas at $6.00 per MMBtu, coal at $1.60 per MMBtu, and biomass at $2.00 per MMBtu) and variable O&M costs. Biomass design assumes a dedicated wood combustion facility. Solar PV cost estimate is based on utility scale installations. CERA_NAP_ConfCall_032008

49. Wind Wind Resource Map: Potential forUtility-Scale Wind Power Development (U.S. Annual Average Wind Power)

50. How Do Solar Panels Work

51. Solar Methods

52. Solar Thermal

53. Solar

54. 54 Source: Cambridge Energy Research Associates, Database of State Incentives for Renewable Energy (DSIRE). *Previous Minnesota RPS was a nonbinding goal except for Xcel Energy. **Wisconsin requires all utilities to increase renewables contributions by 6 percent over the 2001–03 average level by 2015 and has a nonbinding goal of 10 percent by 2015. ***Vermont’s voluntary standard becomes mandatory in 2013 if it is not met by 2012. ****California: IOU = investor-owned utility; ESP = energy service provider; CCA = community-choice aggregator. *****Virginia: 2007 sales less the average annual percentage of power supplied from nuclear generators between 2004 and 2006. 60502-2_1207 Renewables Portfolio Standard (RPS) and Purchase Obligations by State CERA_NAP_ConfCall_032008

55. The Future?

56. Technology to Save Us?

57. How do we rethink meeting our needs?