E.ON Business Deep Dive - Renewables. December, 2015

E.ON Business Deep Dive - Renewables December, 2015

Agenda E.ON Renewables Position E.ON Renewables Business Approach Market Trends 2

E.ON Renewables highlights 4.5 GW diversified portfolio (average age of 8 years) across Europe & US 1 Global #2 in offshore wind Global #12 in onshore wind Multi-technology developer, constructor, operator and asset partner with broad international footprint 12.3 TWh electricity produced in 2014 823 m EBITDA generated in 2014 1. Owned portfolio, forecasted 2015 FY pro-rata share (includes Humber + Amrumbank both at 100%) 3 Since 2007 E.ON has built a top-tier renewables player

Portfolio overview 1 Chicago San Francisco 2310 207 Headquarter Office location Austin 913 Malmö Hamburg Szczecin Capacity (MW) Onshore wind Offshore wind Solar Coventry Essen 462 155 95 US 52% 48% Europe 328 Rome 5.2 GW of operated capacity 1. Forecasted 2015 FY pro-rata share (includes Humber + Amrumbank both at 100%) 4 We own a diversified renewables portfolio of 4.5 GW across Europe and US

Investments in renewables Investments (bn ) 2,3 1,5 1,0 1,2 1,2 1,7 0,9 1,0 2007 2008 2009 2010 2011 2012 2013 2014 2015 Capacity built (GW) 0,4 May 2007 1 1,1 1,9 2,8 3,6 >10x 4,2 4,8 2008 2010 2012 2014 Disposals Onshore wind development Offshore wind development Solar development 5,2 5,3 5,9 4,5 Key facts Total investments of ~11bn (gross) in new capacity since inception of EC&R In the first four years focus largely on onshore wind, since then an increased share in offshore wind Portfolio has grown 10 times since July 2007, despite recently tighter capex situation Strict investment discipline applied with IRRs exceeding WACC by more than a defined minimum hurdle 1.4 GW disposed through capital rotation and strategic country exits 1. Including equity and debt for the acquisitions of E2I and Airtricity 5 E.ON has a proven track-record based on > 10bn successful investments since setup of EC&R in 2007

Track-record Key facts Project examples 5.9 GW of capacity built since 2007 Extensive construction expertise > 50 projects delivered > 90% of projects delivered in budget and on time 2 offshore projects constructed in parallel (CODs in 2015) Grandview I (211 MW US onshore wind) completed within 180 days (FID to COD) Competitive edge in development: top-class site assessment In-house O&M workforce trained to industry standards Excellent execution capabilities on back of continuous development of new projects London Array, the world s largest offshore wind farm COD: Q2 2013 Capex 1 : 2400m E.ON share: 30 % Capacity: 630 MW Grandview I, onshore wind farm in Panhandle, Texas COD: Q4 2014 Capex 1 : 331m E.ON share: 50% Capacity: 211 MW Maricopa West, PV park in Kern County, California COD: Q4 2015 Capex 1 : 55 m E.ON share: 100 % Capacity 2 : 28 MW 1. 100% of Capex 2. PV capacity in MW DC (Direct Current) 6 We deliver outstanding performance based on our expertise and capabilities

Earnings EBITDA Development ( bn) 0.2 Revenue Mix 2015 US 0.3 0.5 UK 0.6 0.6 2008 2009 2010 2011 2012 2013 2014 2015 0.7 Continental Europe 0.8 Merchant Regulated / long-term contracted Key facts EBITDA growing since inception with a CAGR of 33% Growth pace fastest in the phase 2007-2010 Since then capital rotation and disposals slightly impacted earnings development Strong capex focus on offshore in 2013-2015 Majority of earnings supported by regulated / long-term contracted revenues ~60% ~25% of 2015 EBITDA in US onshore, ~40% in Europe offshore and rest in Europe onshore Earnings have grown continuously over past 7 years 7

Agenda E.ON Renewables Position E.ON Renewables Business Approach Market Trends 8

E.ON key success factors and portfolio approach E.ON Key Success Factors in Renewables E.ON Portfolio Approach in Renewables Access to premium sites Focus on attractive technologies Cost competitiveness and end-toend process excellence Capture attractive remuneration schemes across different markets in stable countries Scale advantage (supported by partnering and capital rotation) Prudent and disciplined capital allocation We have a holistic and value creating approach to renewables 9

Site selection Examples offshore wind Water depth [m] 50 45 40 35 30 25 20 15 10 5 0 London Array Kårehamn Blyth Rødsand 2 0 10 Rampion Humber Gateway Scroby Sands Robin Rigg 20 30 Positioning of UK round 3 projects 1 Alpha Ventus Amrumbank West In operation Distance to shore [km] Start with near shore, shallow water projects before moving to deeper water, far shore projects 40 Size of this circle corresponds to 200 MW wind farm size 50 Under construction 60 70 80 Example Grandview (Texas, US) Site layout Grandview secured by early analysis of the grid expansion program in Texas in 2010 Potential size of the site: ~ 1.0 GW (211 MW already built and 200 MW under construction) Avg. load factor: >50% 1. Source: Renewables UK, 4COffshore 10 Attractive site selection with improved economics

Current regulatory regimes and frameworks Remuneration scheme by geography E.ON Market Highlights PAYMENT MECHANISM Feed-in tariff Premium Quota obligation & tradable certificates Others ALLOCATION Competitive auctions Auctions legislated but yet to be held or pilot auctions only SUBSIDY BUDGET Capped 913 Summary US: Tax Credits (PTC and ITC) Accelerated Depreciation (MACRS) Renewable Portfolio Standards (RPS) Expected positive impact from Clean Power Plan UK: Renewable Obligation Certificates (ROC) Contract for differences (CfD) Levy Exemption Certificates (LEC) have fallen away (Aug 2015) Germany: Feed-in tariff (FIT) for German offshore ( Stauchungsmodell ) Source: Bloomberg 11 Attractive regulatory regimes and policy support still prevailing in our core markets

Industry learning curve LCOE 1 Installed capacity Fixed subsidies Tenders High policy support Higher competition & cost pressure 1. Levelized Cost Of Electricity As markets mature and competitiveness increases, operational excellence will remain key for sustainable, profitable growth 12

LCOE development trends LCOE global trend 1 LCOE key drivers Offshore Wind Onshore Wind Coal Gas ( /MWh) 140 CAPEX and OPEX Reduction 120 100 80 60 Output Optimization 40 2013 2017 2020 2023 1. Assumed conversion rate /$ = 1.12. Average of China, India, US and Europe Source: Stiftung (Offshore Wind), Bloomberg New Energy Finance (Onshore Wind, Coal, Gas) 13 Wind LCOE competitive with other technologies

LCOE development at E.ON Cost Structure Example of onshore wind E.ON project LCOE examples ( /MWh) 1 Generation cost Installation Risk-margin Other CAPEX Offshore 100% -22% 78% Turbines CAPEX 2011 (Humber) 2015 (Rampion) Other OPEX (only partially controllable) Onshore -40% OPEX O&M 100% 60% 2009 (Pyron) 2015 (Colbeck s Corner) 1. At final investment decision (FID). 14-10% CAPEX reduction equates to ~110 bps IRR increase

CAPEX reduction CAPEX/MWh examples 1 Offshore 2011 (Humber) 2015 (Rampion) Onshore North America 2009 (Pyron) 100% -18% 82% 100% CAPEX reduction levers Optimized design LCOE-driven layout (optimizing wind yield and installation costs) Fit for purpose design/selection of components (site specific economically optimal wind turbine types) Standardized and integrated process Rigorous application of procurement best practices Central procurement applying optimized procurement strategy Increased supplier choice/competition by proactive supplier development, involvement of global suppliers, e-auctions Bundling and volume effect of a long term charter 2015 (Colbeck s Corner) 56% -44% Project / construction management excellence Recent examples: Completed latest two offshore projects (combined 500 MW) and latest US onshore project (200 MW) on time and budget 1. At final investment decision (FID). 15 We continuously drive down required capital by optimizing design, procurement and construction

OPEX reduction O&M cost containment Onshore 1 2011 baseline for 2015 O&M Contracting Spares concept & contracting CMS/ Smart Maintenance Other initiatives Additional cost reduction Estimation YE 2015 82% 5% 100% 2% 3% 4% 4% -18% O&M levers O&M improvement measures O&M contracting and concept: Roll-out of self-perform and mixed team sites; break-out of full service contracts into standard contract modules Spares concept and contracting: Application of global framework for major components and own purchase of consumables Smart Maintenance: Retrofit with Condition Monitoring System and development of a predictive maintenance strategy Other initiatives Additional potential due to active asset management concepts by Further contract re-negotiation Other initiatives 1. Based on portfolio as per 2011 baseline for 2015. 16 Operation & maintenance as key lever for OPEX reduction

Load factor and availability Offshore Onshore US Onshore EU 50 40 30 36 35 46 50 40 30 35 34 37 36 50 40 30 25 30 25 30 Load factor (%) 20 10 0 20 10 0 20 10 0 2013 2014 2013 2014 48+% load factor in recent projects 3 50+% load factor in recent projects 3 2013 2014 Net load factor for ~5 years old farms 1 Net load factor for ~3 years old farms 2 Energetic Availability (%) 100 96 94 98 100 96 98 80 80 60 60 40 40 20 20 0 0 2013 2014 2013 Energetic availability for ~5 years old farms 1 97 2014 98 100 80 60 40 20 0 98 97 97 97 2013 2014 Energetic availability for ~3 years old farms 2 1. COD in 2009-2010; 2. COD in 2011-2012 (onshore) and in 2013 (offshore) 3. Offshore: Ambrumbank West; Onshore: Grandview 1 and Colbeck s Corner 17 We have excellent performances in terms of both availability and load factors

IRR vs WACC spreads examples Bps above WACC 1.000 750 500 250 Size of this circle corresponds to 200 MW wind farm size WACC 2009 2010 2011 2012 2013 2014 2015 Onshore wind Offshore wind Year of final investment decision Attractive returns above WACC plus hurdle 18

Additional value creation Partnering Third party investors, especially in large-scale projects, increase flexibility and support a diversified portfolio development Partnering supports economies of scale and further development of E.ON capabilities while at the same time developing relationships with long-term valuable partners Partnering allows for shared construction & operational risks and smother earnings profile E.ON generates additional income as construction manager and operator of the sites Strategic partners offer complementary capabilities, allowing to reduce LCOE and risks as well as enhancing success rate in tenders Third Party Services Offering full scale operations, maintenance, asset & energy mgmt. services to third party asset owners Unique value proposition towards customers as E.ON s experience and capabilities in building & operating renewable farms is strong Emergence of new financial players as well as small/ midsized wind farm owners without inhouse technical competencies seeking steady cash flow and lower risk profile Leveraging global experience and portfolio allows E.ON to takeover and manage risks on customer s behalf Asset-light business model and economies of scale (e.g. technical support, procurement) by increasing operational portfolio with customer sites Natural and complementary business model to partnering 19 Partnering & Third Party Services allow risk diversification and further leveraging our capabilities

Capital recycling Transaction type Main rationale Past transactions Partnering Reduce exposure to cluster and regulatory risks of large projects Increase flexibility and support a diversified portfolio development Additional value from Third Party Services Rampion (Offshore) Cap: 400 MW Sold: 49.9% Year: 2015 Build to sell Lock-in value upside especially from US PV Rapid monetization of created value Alamo (PV) Cap 1 : 24 MW Sold: 100% Year: 2015 Capital rotation of operational assets 1. PV capacity figures in MW DC (Direct Current) Advance monetization of value from existing projects to fund new ones Additional value from Third Party Services US Onshore Cap: 433 MW Sold: 50% Year: 2012 Rödsand (Offshore) Cap: 207 MW Sold: 80% Year: 2013 US Onshore Cap: 406 MW Sold: 80% Year: 2014 20 Successful capital recycling has contributed to E.ON s renewables development in the past

PV projects & initiatives Key facts Capacity built 1 (MW) PV project delivery experience of >150 MW (14 projects), including development and construction 92 49 11 152 Current geographical focus in US ~90% of the projects delivered on time and on budget In the past, focus on build to sell Highly standardized development and engineering to ensure end-to-end process excellence and off-the-shelve PV project delivery Professional Energy Marketing enables participation in tenders and RFPs US Italy France Total Recent projects 1 (built & sold) Alamo Size: 24 MW COD: May 15 Buyer: Dominion Maricopa West Size: 28 MW COD: Nov 15 Buyer: Dominion 1. Until end 2015. All capacity figures in MW DC (Direct Current) 21 E.ON can rely on existing capabilities and experience also in solar PV

Agenda E.ON Renewables Position E.ON Renewables Business Approach Market Trends 22

Market trends renewable capacity growth Global 1 (GW) Global growth trends 2.000 1.000 0 2015 EU 1 (GW) 1.000 500 2020 7% 4% 2025 2030 Recent market development Wind & Solar cover largest share of capacity additions with focus on emerging markets Largest markets for Wind & Solar until 2020: China, India, United States, Germany, Japan Investments in Solar and Wind > $300bn of global renewable investments per annum expected for the next 25 years US 1 (GW) 1.000 500 0 2015 2020 4% 2025 2030 Key drivers for future growth Competitiveness: Renewables cost decreasing Security of supply: Fuel independence Industrial policy: Local content requirements Climate change: Low-carbon generation 0 2015 2020 2025 2030 Competitiveness of storage 1. Installed capacity, excluding large-scale hydro; Growth expressed as CAGR Source: IHS Utility PV Offshore wind Onshore wind Others Renewables energy market growing fast, especially in Wind and Solar PV 23

E.ON key strengths Proven track record in the most attractive technologies across different markets Cost competitiveness & process excellence as well as best site selection and scale Solid position and grow path in core markets 24 Well positioned to further benefit from continuous growth in renewables

Agenda E.ON Renewables Position E.ON Renewables Business Approach Market Trends Appendix 25

Current regulatory regimes and frameworks (cont d) UK Offshore ROC per MW Term: 20 years Remuneration: Wholesale price plus 1.8-2.0 ROC/MWh based on COD Applicable for all E.ON offshore parks in UK 1 From 2014 move to CfD system (strike price in first auction 114.39-119.89/MWh) Onshore Wholesale price plus ROC (valid until 2016) Term: 20 years Remuneration: 0.9 ROC Applicable for all E.ON onshore From Feb. 2015, CfD system (strike price in first auction 79.23-82.50/MWh ) Germany Offshore FIT with direct marketing obligation Remuneration (EEG 14): - Initial tariff: 154 /MWh for 12 years (standard) or 194 /MWh for 8 years (accelerated model) - Base tariff: 39 /MWh - Initial tariff extended for deep waters/distance to shore Applicable for all E.ON offshore parks in Germany 2 Onshore FIT with direct marketing obligation Term: 20 years plus the year of start of operation (initial tariff for min 5 years followed by base tariff) Remuneration (EEG 14): - Initial tariff: 89 3 /MWh - Base tariff: 49.5 /MWh From 2016: ~0.4% quarterly digression Applicable for all E.ON onshore parks in Germany US Onshore Remuneration based wholesale market or PPA, plus certain incentive features Production Tax Credit ($23/MWh) or Investment Tax Credit (30% of investment) in place for projects completed by 2016 Renewable Energy Certificate (driven by state-level Renewables Portfolio Standards (RPS) Accelerated Depreciation for tax equity investors and developers (MACRS) Solar Remuneration based PPA plus certain incentive features Investment Tax Credit (30% of investment) in place for projects completed by 2016 after drops to 10% Renewable Energy Certificate (driven by state-level Renewables Portfolio Standards (RPS) 1. Including Rampion 2. Including Amrumbank and Alpha Ventus 3. Base on reference turbine ROC: Renewables Obligation Certificate; CfD: Contract for Difference; FiT: Feed-In-Tariff 26 Capturing attractive regulatory remuneration schemes

E.ON project examples Summary Amrumbank (COD 15) 288 MW FIT ( Stauchnungsmodell ) 100% share Colbeck's Corner (COD 16) 200 MW Merchant 100% share Maricopa West 1 (COD 15) 28 MW 100% share To be disposed in 15 Rampion (COD 18) 400 MW 20 years ROC scheme 75% share Countries with projects under development 1. PV capacity in MW DC (Direct Current) 27 E.ON has diversified portfolio of projects under construction

Disclaimer This presentation may contain forward-looking statements based on current assumptions and forecasts made by E.ON Group Management and other information currently available to E.ON. 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 the company and the estimates given here. E.ON SE does not intend, and does not assume any liability whatsoever, to update these forward-looking statements or to conform them to future events or developments.