„BEYOND NUKES – What comes in Germany after phasing out of Nuclear Energy?“

1. Conference on the Future of Energy in Enlarged Europe: Perspectives for R&D Co-operation“ A contribution within the context of the ‘Weimar Triangle’ Warsaw, 7- 8th October 2004 EnBW Energie AG, HOL VT, WP

2. „BEYOND NUKES – What comes in Germany after phasing out of Nuclear Energy?“ Jürgen Hogrefe,Senior Vice President of EnBW AG – Energie Baden Württemberg, Karlsruhe EnBW Energie AG, HOL VT, WP

3. Contents • Challenge for the German Energy Sector • General Conditions and Premises • EnBW Generation Strategy EnBW Energie AG, HOL VT, WP

4. European capacity development Germany has a share of circa 20% of the power installed in Europe! EnBW Energie AG, HOL VT, WP Source: Facts and Figures of Electrical Production 2003 ; VGB PowerTech Note: Translation of the figure see appendix 1

5. German capacity development Assuming a constant need of power: Additional capacity in Germany by 2025 of ca. 61,700 GW as a result of the age structure and the exit from nuclear energy EnBW Energie AG, HOL VT, WP Source: Facts and Figures of Electrical Production 2003 ; VGB PowerTech Note: Translation of the figure see appendix 2

6. Inhalt • Challenge for the German Energy Sector • General Conditions and Premises • EnBW Generation Strategy EnBW Energie AG, HOL VT, WP

7. General conditions are generally accepted as the basic parameter for the future of energy. Political framework Supply security Profitability Environmental tolerance and sustainability EnBW Energie AG, HOL VT, WP

8. Target square of anenergy supply company in Germany Kyoto Protocol Customers‘ price concept Shareholders‘ idea ofreturns Atomic Consensus EnBW Energie AG, HOL VT, WP Are the general conditions such that all the targets can be sufficiently met ?

9. General Conditions and Premises • Development of the national electrical consumptions • Nuclear energy consensus • Development of the climate situation • Assuring the greatest possible autonomy of the national energy supply • Availability of the primary energy sources oil, gas, coal and their price development • Secure the energy supply for the customers • Technological development in power plants and networks • Profitability of the energy production under the conditions of a liberalized market • Sufficient focus on the national competitive situation EnBW Energie AG, HOL VT, WP

10. Lifespan of the German nuclear power plants on the basis of the nuclear energy agreement EnBW Energie AG, HOL VT, WP Transfers of quantities of electricity are possible ! Note: Translation of the figure see appendix 3

11. Detailed Germany-wide survey of about 80 % of the power plant operators • 62 % of those surveyed expect that the residual lifespan of the nuclear power plants will be extended • Those surveyed are convinced that the German electrical supply cannot be assured without nuclear power and that the exit from nuclear energy and the reduction of emissions are mutually exclusive targets • Source: trend research; Power Plants 2020 EnBW Energie AG, HOL VT, WP

12. Prognosis for regenerative energies in Germany Share of renewable energies in the primary energy consumption in 2004 was 3.1 % Political target according to the German Renewable Energy Act: Share of renewable energies in electrical supply by 2020 of 20 %; EnBW Energie AG, HOL VT, WP The share of regenerative energies is limited despite subsidies and substantial growth Note: Translation of the figure see appendix 4

13. Replacement of lost capacities EnBW Energie AG, HOL VT, WP Replacement capacities in the magnitude of the nuclear power plants to be shut down can only be supplied by fossil-fuel power plants for the short-to-medium term

14. Inhalt • Challenge for the German Energy Sector • General Conditions and Premises • EnBW Generation Strategy EnBW Energie AG, HOL VT, WP

15. Electrical power supplied by EnBW in 2003 Electrical power supplied in 2003 at 75,3 TWh EnBW Energie AG, HOL VT, WP Nuclear energy represented an important component of the EnBW energy mixture

16. Subsidizing of major hydroelectric plants (> 5 MW) on the basis of the amendment of the German Renewable Energy Act Rebuilding Rheinfelden in the Energiedienst AG (80 % holding of EnBW): Hydro-electric power plant with total power of 116 MWel Commencement of operations expected for 2011 Renewable energies at EnBW Aerial view of the existing Rheinfelden power plant EnBW Energie AG, HOL VT, WP Construction of the dam at the Rheinfelden power plant (1st const. phase of rebuilding)

17. 0 EnBW capacity needed as a result of power plants lost Option: Capacity for sales increase in growth markets Need for coal power plants to be shut down (age-related) and nuclear power plants to be shut down Own power plants, holdings in power plants and power plant-like contracts EnBW Energie AG, HOL VT, WP

18. Generation strategy- Possible replacement measures - • Increase power of existing conventional power plants • Extend lifespan of existing conventional power plants • Rebuild power plants (convert from peak plants to medium and basic power plants) • Build new power plants Possibilities for replacingcapacity EnBW Energie AG, HOL VT, WP

19. Lifespan extension measures Increase power Examples: RetrofittingRheinhafen steam power plant block 7, medium power, coal Reactivation Walheim 1, medium power, coal EnBW Energie AG, HOL VT, WP • Retrofit Rheinhafen steam power plant 7 • El. power 492 MW • Power gained through retrofit 11 MW • Scheduled implementation 10/2005 • Walheim 1 • El. power 103 MW • Recommencement of operations 01/2005

20. Options for the building of a new power plant Variable costs Source: Investments in liberalized energy markets: options, market mechanisms, general conditions; bremer energie institut; January 2004 EnBW Energie AG, HOL VT, WP • Brown coal and hard coal are interesting due to the long-term price stability • Due to location disadvantages brown coal is not interesting for EnBW • Natural gas cannot currently be used profitably in the basic power plant due to the high price level Note: Translation of the figure see appendix 5

21. Process prior to investment decision for a new power plant Power plants capacity development EnBW sales development (Comparison with PP capacities -> need) Select primary energy source (Options for EnBW: coal, gas) Screening of existing EnBW sites (Grid feeding/stability, permit situation, ...) Detail investigation for selected energy sources and sites Investment decision EnBW Energie AG, HOL VT, WP Time Current status

22. Conclusion • By 2025 61,700 MW of installed power will have to be replaced in Germany as a result of the aging and the exit from nuclear energy • The target square: atomic consensus, Kyoto Protocol, shareholders’ ideas about returns, customers‘ price ideas have to be met • According to a survey 80 % of the power plant operators are of the opinion that the German electrical supply cannot be guaranteed without nuclear power and the nuclear energy exit and reduction of emissions are mutually exclusive goals • Regenerative energies are limited despite subsidies and substantial growth • Replacement capacities in the magnitude of the nuclear power plants to be shutdown can only be met in the short to middle-term by fossil fuel power plants • Brown coal and hard coal power plants are economically interesting. Combined cycle power plants are currently not suitable for the basic load as a result of the high price level EnBW Energie AG, HOL VT, WP

23. Appendix 1: Translation figure slide 2 EnBW Energie AG, HOL VT, WP

24. Appendix 2: Translation figure slide 3 EnBW Energie AG, HOL VT, WP

25. Appendix 3: Translation figure slide 10 EnBW Energie AG, HOL VT, WP

26. Appendix 4: Translation figure slide 12 EnBW Energie AG, HOL VT, WP

27. Appendix 5: Translation figure slide 20 EnBW Energie AG, HOL VT, WP