Power Generation Portfolio Håkan Bushke Senior Vice President Electricity Production E.ON Capital Market Day Nordic Stockholm, July 3, 2006
Agenda Nordic and the Swedish power situation E.ON Sverige generation Generation types and capacities Conclusions Page 2
Historical generation in the Nordic market 1978-2005 Fuel mix Market shares of generation 2005 TWh 450 400 350 300 250 200 150 100 50 Other renewables Thermal Nuclear Hydro Other Vattenfall Fortum Statkraft E.ON Sverige DONG/Elsam/E2 Pohjolan Voima 0 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 Source: Nordel 2005 Source: E.ON Page 3
Generation in Sweden (2005 = 155 TWh) Fuel mix per competitor Market participants TWh 80 70 60 72 Other Thermal Hydro Statkraft 1% Skellefteå Kraft 2% Other 11% 50 40 30 34 28 Nuclear Fortum 16% Vattenfall 47% 20 16.4 10 0 Vattenfall E.ON Fortum 3.5 Skellefteå 0.4 Statkraft Others E.ON Sverige 23% Sverige Kraft Source: svensk Energi 2005 Page 4
Agenda Nordic and the Swedish power situation E.ON Sverige generation Generation types and capacities Conclusions Page 5
Power generation portfolio E.ON Sverige All capacity numbers based on 100 % stake Bergslagen 11 power plants 60 GWh 16 MW hydro Northern Sweden 56 power plants 11,300 GWh 2,700 MW hydro Forsmark E.ON Sverige 9.8 % 3,160 MW nuclear Karskär E.ON Sverige 50 % 172 MW oil Ringhals E.ON Sverige 29.6 % 3,540 MW nuclear Southern Sweden 53 power plants 1,200 GWh 290 MW hydro Bråvalla E.ON Sverige 100 % 230 MW oil OKG - Oskarshamn E.ON Sverige 54.5 % 2,230 MW nuclear Karlshamn E.ON Sverige 70% 1,000 MW oil Page 6
E.ON Sverige Power generation portfolio development E.ON Sverige Total 2005 power assets 6,946 MW E.ON Sverige planed capacity increase TWh 40% 37% 8% 40 35 30 25 20 15 10 Other Thermal Nuclear Hydro Hydro Nuclear 15% 2005 2007 2009 2011 2013 2015 Gas turbine Other thermal Page 7
Our generation portfolio is geared for significant growth in nuclear, gas-fired and wind capacity All capacity numbers based on 100 % stake Forsmark (E.ON 54.5%) 540 MW nuclear upgrade programs 2004-2010 Ringhals (E.ON 29.6%) 510 MW nuclear upgrade 2005-2011 Malmö, Öresundsverket (E.ON 100%) 400 MWel, 250 MWth new build, gas 1 Project in planning stage. Utgrunden, Kårehamn, Midsjöbanken, other 1 up to 1.000 MW new build offshore wind OKG Oskarshamn (E.ON 54.5%) up to 480 MW nuclear upgrade 2008-2012 Page 8
Agenda Nordic and the Swedish power situation E.ON Sverige generation Generation types and capacities Conclusions Page 9
Nuclear power in Sweden Main projects: Life time extension to 60 years Capacity upgrade New operational safety rules New site protection rules 1 Ringhals Owner: Vattenfall 70.4 % E.ON Kärnkraft Sverige 29.6 % Net capacity: 1 R1 846 MW R2 867 MW R3 917 MW R4 908 MW 3 2 2 3 Forsmark Owner: Vattenfall 66 % Mellansvensk Kraftgrupp 25.5 % E.ON Kärnkraft Sverige 8.5 % Net capacity: F1 1 011 MW F2 951 MW F3 1 190 MW OKG Owner: E.ON Kärnkraft Sverige 54.5 % Fortum kraft 45.5 % Net capacity: O1 467 MW O2 602 MW O3 1 160 MW Page 10
Nuclear power generation Plant Reactor Start year Effect 2006 Effect 2012 E.ON share Oskarshamn 1 1972 467 467 2 1974 602 812 3 1986 1,160 1,400 Total 2,229 2,679 54.5% Ringhals 1 1976 846 859 2 1975 867 867 3 1981 917 1.120 4 1983 908 1.140 Total 3,538 3,986 29.6% Forsmark 1 1980 1,011 1,130 2 1981 951 1,130 3 1985 1,190 1,360 Total 3,152 3,620 9.8% Total 8,919 10,285 Page 11
Opinions on nuclear in Sweden November 2005 Should we: What is your personal view of the use of nuclear power in Sweden? Phase out nuclear power production although not necessary for safety reasons? Use nuclear power until the present reactors do need to be closed on safety or cost grounds? Continue with nuclear power production and replace existing ones when they have reached the ends of their lives? Develop nuclear power production and build new and more reactors if necessary? 38% 24% 3% 15% 20% Use Continue Phase out Develop Unsure Unsure, don't know. Page 12
Hydroelectric power E.ON Sverige Northern Sweden 54 power plants 10,800 GWh 2,800 MW Bergslagen 8 power plants 50 GWh 11 MW Southern Sweden 53 power plants 1,200 GWh 290 MW Page 13
Hydroelectric power today and tomorrow Two areas Separate Control Centers Strict geographic divisions Separate systems Partly separate working methods Future Goal One system Dual point of steering Page 14
Hydroelectric power - reservoir security Reservoir security is primarily about preventing the emergence of an uncontrolled outflow of water from the reservoirs that might damage the surroundings. Reservoir security work is systematic preventional work to reduce the probability and reduce the consequences of such an uncontrolled outflow. Security projects in progress Administrative work Consequence classification of all plants, to be finished by 2008 Safety manuals for all plants Contingency plans Make instructions for operation, supervision and maintenance Insurance coverage in an amount of roughly 660 billion Page 15
E.ON Sverige wind power plants 2006 Existing wind mills Planned projects Our Swedish plants: 27 wind mills Installed capacity: 17 MW Power generation: 38 GWh Our Danish activity: 20% of Nysted Havmöllepark 72 wind mills Installed capacity: 165 MW Power generation: 595 GWh Page 16
E.ON Nordics long term wind power growth potential (2,200 MW) Wind power strategic direction Take an active part in the growth of wind power in Denmark, Norway and Sweden, both on shore and off shore Analyze opportunities for the Baltic region during 2006 Wind power projects 2006-2008 2008-2012 2012-2015 Sweden Utgrunden II, 90 MW Kårehamn, 50 MW Unspecified offshore Midsjöbanken, up to 1000 MW Onshore 100-200 MW Norway Onshore 400-800 MW Denmark Nysted II, 40-80 MW Unspecified offshore Page 17
Power generating thermal plants Karlshamn 1,000 MW Bråvalla 230 MW Karskär 172 MW Gasturbiner 500 MW Main focus and projects Gasturbiner E.ON Sverige 100% 500 MW oil Karskär E.ON Sverige 50% 172MW oil New power plant in Malmö 400 MW e and 250 MW heat Transition to use renewables and minimizing CO2 emissions Bråvalla E.ON Sverige 100% 230 MW oil It is important to start conversion into BIOGAS and CO 2 separation and storage Karlshamn E.ON Sverige 70% 1,000 MW oil Page 18
CHP in Malmö in planning stage Technology Gas turbine Steam turbine Steam extraction for district heating Carbon strategy Replaces coal condensing power plants Reduces global carbon dioxide emissions by more than 1 million t/a Security of supply Adds needed generation capacity to strengthen the power balance in southern Sweden. Security of supply of electricity and heat to the Malmö region. Combined cycle plant achieves over 90% efficiency rate between power and heat. Page 19
Summary > 20% increase in power generation Life time extensions for nuclear and hydro power Strong program to build-up renewable generation capacity Continued political stability is needed to complete all these programs Roughly 1.1 billion in investment plan for these projects Generation capacity increase will lower our specific cost per KWh Page 20
This presentation do not constitute an invitation to sell or an offer to buy any securities or a solicitation of any vote or approval. Endesa investors and security holders are urged to read the tender offer prospectus from E.ON regarding the proposed tender offer for Endesa when it becomes available, because it will contain important information. The tender offer prospectus and certain complementary documentation will be filed in Spain with the Spanish Comisión Nacional del Mercado de Valores (the CNMV ). Likewise, a tender offer statement, which will incorporate the prospectus by reference, will be filed in the United States with the U.S. Securities and Exchange Commission (the SEC ). Investors and security holders may obtain a free copy of the tender offer prospectus (when it is available) and its complementary documentation in the central offices of E.ON, Endesa, the four Spanish Stock Exchanges, and Santander Investment Bolsa SV SA. The prospectus will also be available on the websites of the CNMV (www.cnmv.es) and E.ON (www.eon.com). Likewise, investors and security holders may obtain a free copy of the U.S. tender offer statement (when it is available) and other documents filed by E.ON with the SEC on the SEC s web site at www.sec.gov. The tender offer statement and these other documents may also be obtained for free from E.ON, when they become available, by directing a request to E.ON AG, External Communications, phone +49-211-4579-453. This presentation may contain forward-looking statements. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of E.ON and Endesa and the estimates given here. These factors include the inability to obtain necessary regulatory approvals or to obtain them on acceptable terms; the inability to integrate successfully Endesa within the E.ON Group or to realize synergies from such integration; costs related to the acquisition of Endesa; the economic environment of the industries in which E.ON and Endesa operate; and other risk factors discussed in E.ON s public reports filed with the Frankfurt Stock Exchange and with the SEC (including E.ON s Annual Report on Form 20-F) and in Endesa s public reports filed with the CNMV and with the SEC (including Endesa s Annual Report on Form 20-F). E.ON assumes no liability whatsoever to update these forward-looking statements or to conform them to future events or developments. E.ON prepares its consolidated financial statements in accordance with generally accepted accounting principles in the United States ("U.S. GAAP"). This presentation may contain references to certain financial measures (including forward looking measures) that are not calculated in accordance with U.S. GAAP and are therefore considered "non-gaap financial measures" within the meaning of the U.S. federal securities laws. E.ON presents a reconciliation of these non-gaap financial measures to the most comparable U.S. GAAP measure or target, either in this presentation, in its Annual Report, or on its website at www.eon.com. Management believes that the non-gaap financial measures used by E.ON, when considered in conjunction with (but not in lieu of) other measures that are computed in U.S. GAAP, enhance an understanding of E.ON's results of operations. A number of these non-gaap financial measures are also commonly used by securities analysts, credit rating agencies, and investors to evaluate and compare the periodic and future operating performance and value of E.ON and other companies with which E.ON competes. These non-gaap financial measures should not be considered in isolation as a measure of E.ON's profitability or liquidity, and should be considered in addition to, rather than as a substitute for, net income, cash flow provided by operating activities, and the other income or cash flow data prepared in accordance with U.S. GAAP. The non-gaap financial measures used by E.ON may differ from, and not be comparable to, similarly titled measures used by other companies. Page 21