# From: Hedren, Patrick (GE Corporate) <Patrick.Hedren@ge.com>

Sent: Friday, January 17, 2014 7:46:47 PM

To: Harvey, Reid

Subject: Slides for docketing on wind/renewables

Hi Reid,

Figured it was easiest to email someone I had already sent a message to – attached are our slides

from today’s wind/renewables portion of the disc ussion. They are ready for public docketing, and

should not contain any GE proprietary or sensitive information. Please let me know if you have any

questions and feel free to contact me at my mobile number below.

I am happy to resend to a different party if that is best, just let me know.

Best,

Patrick D. Hedren

Counsel, Regulatory Policy

GE Corporate – Government Affairs & Policy

T +1 202 637 4250

M +1 202 215 8759

patrick.hedren@ge.com

1299 Pennsylvania Avenue, N.W.

Washington, DC 20004

<< EPA meeting_GERenewables_draft_v4 for docket.pptx >>GE RenewablesJanuary 17, 2014Paving the path forward© 2014 General Electric Company2GE Title or job number6/3/2014Wind going mainstreamWind is changing the world587392120153186224'05 '06 '07 '08 '09 '10 '11 '1242%of ‘12 U.S. ... largest PG techinstalls60GWin U.S. ...~52coal plants8 states~10%wind generation6 countries10%+wind generationRecord year for wind in15countries~800TWh... ~4% global penetrationCool wind statsGlobal wind installations267GWCumulative (GW)Source: GE Marketing© 2014 General Electric Company3GE Title or job number6/3/2014A decade of progress in windRenewables is a long-term infrastructure playWinning in asubsidy-freeworld98%availability50%+cap. factorGrowingReliableLow costEfficientMainstream$50B/year~4%of electricity5 centpower2002$5B/year85%availability25%+cap. factor0.4%of electricity15 centpower2012The next chapter© 2014 General Electric Company4GE Title or job number6/3/2014GE Renewables6.7GWinstalled in ‘12$2Binvestment in Renewables34 GW+installed~23,000+ WTGsin30countries~425 millionMWh producedWorld’s most efficient & reliable wind turbine fleet© 2014 General Electric CompanyTransforming with Technology9. Recent equipment improvements are allowing winddevelopment in areas where it was previously not marketable.How much more near future improvements to wind turbineperformance (e.g. turbine improvements, blade diametersincreases, and hub height increases) do you see coming intothe market in the next decade or so? Are these expected tocontinue at same pace as recent improvements, acceleratingor tapering off?So ... what’s so great about this1.6-100 anyway?Nameplate(MW)Power curve02

Power (MW)Wind speed (m/s)010 201.6-1001.7-1001.6-82.51Rotordiameter (m)Rotor diameter: how fast powerramps at low wind speedsNameplate: max power output7 m/ssite11 m/ssiteLong rotor tradeoff...cost, but worth it atlow wind speedsAnnual Energy ProductionOutput (MWh)total energy productionper turbine/yrCapacity FactorEfficiency (%)avg energy productionas % of max© 2014 General Electric Company7GE Title or job number6/3/2014NREL Database @ 100mJan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec1 2 3 4 5 6 7 8 9 10 11 120:00 9.8 8.8 9.4 9.5 9.8 9.9 9.2 8.1 8.5 9.1 9.4 10.51:00 10.0 8.4 9.7 9.3 9.7 9.2 9.1 7.5 8.1 8.9 8.6 10.52:00 9.8 8.6 9.3 8.8 9.7 8.4 8.6 7.2 7.8 8.8 8.7 10.23:00 10.2 8.3 9.1 8.0 9.8 8.0 8.3 7.1 7.7 8.6 8.8 10.04:00 10.5 8.4 9.0 8.1 9.5 8.3 7.6 7.4 7.7 8.7 8.6 9.95:00 10.3 8.3 8.8 8.3 9.8 8.0 7.4 7.1 7.2 8.8 8.5 9.86:00 10.2 8.4 8.8 8.6 9.4 7.5 7.1 6.7 6.8 8.7 8.1 9.87:00 10.1 7.9 8.6 8.4 8.5 6.2 6.0 5.7 6.1 8.6 8.2 9.68:00 9.4 7.6 7.4 8.0 8.2 6.2 6.0 5.7 5.2 7.9 7.5 8.99:00 8.5 7.5 6.7 8.0 8.2 6.5 6.1 5.6 5.5 7.6 6.3 7.810:00 7.4 7.7 7.4 7.9 8.2 6.9 6.2 5.6 5.6 7.7 6.7 7.111:00 7.9 7.8 8.0 7.7 8.0 7.0 6.1 5.7 5.4 7.9 7.0 7.212:00 7.9 8.0 8.4 7.8 8.3 7.0 6.4 5.9 5.6 7.7 7.2 7.113:00 7.8 8.6 8.6 8.1 8.1 7.0 6.5 6.1 5.7 7.8 7.3 7.114:00 8.2 8.4 8.9 8.4 8.2 7.2 7.0 6.3 5.9 7.7 7.3 7.315:00 8.6 8.4 9.2 8.6 8.4 7.5 6.8 6.5 6.6 8.2 7.4 7.516:00 8.5 8.7 9.3 8.8 8.5 8.1 6.7 6.7 6.9 8.4 7.5 7.817:00 8.5 8.9 9.5 9.0 8.7 8.7 6.7 6.8 7.0 8.3 7.9 8.118:00 8.7 8.6 9.2 9.3 8.5 8.9 7.0 7.4 7.4 8.5 9.3 9.419:00 9.4 8.8 9.7 9.7 8.9 8.8 7.7 8.1 8.1 9.0 9.8 10.320:00 9.9 9.1 10.1 10.5 9.5 9.6 8.1 8.6 8.9 9.1 10.0 10.621:00 10.2 9.5 10.2 10.5 9.9 10.4 8.6 8.6 9.1 9.4 10.2 10.722:00 9.9 9.5 10.0 10.2 10.3 10.3 9.4 8.5 9.1 9.4 10.1 10.423:00 9.7 9.2 9.6 9.6 10.3 10.4 9.4 8.1 8.7 9.3 9.9 10.59 28 59 08 89 08 27 47 07 18 58 39 1Value of technology evolution• Longer rotors...more energy at low windLonger rotors provide more energy & capacity when neededSource: 2006 NREL DataAverage wind speed, by hour &month(wind speed in meters/second, site in Oklahoma)IncrementalValue0200400600800100012001400160018001 2 3 4 5 6 7 8 9 10 11 12 13Wind Speed (m/s)1.5-771.7-100Value Created

Power (kw)Power vs wind speed© 2014 General Electric CompanySource: GE RenewablesMonth

Hour• Low wind often correlates with peak load8GE Title or job number6/3/2014Sources: NREL, Ventyx, GEAssumptions:• All values in real terms• GE Cost estimates for BoP• 70/30 debt to equity• 7% cost of debt, 12% equity return• 2% inflation• GE 1.7-100 WTG*Pre-tax, 20yr levelized**20yr levelizedWind economics vary across countrySubsidy free wind ...the nextchallenge© 2014 General Electric Company• Wind LCOE dependent upon sitewind speed• Economics of wind depend on“next best alternative” (e.g. gas,coal)Transforming with technology10GE Title or job number6/3/2014• Advanced turbine controls & sensors• Short term storage integration• Cost effective large rotors• “Park as a product”GE Wind ... shifting the paradigmDriving predictable power at gridparityGoal: reducing LCOEExistingtechnologyNewtechnologyTechnology solutionsTurbine size

LCOE© 2014 General Electric Company11GE Title or job number6/3/2014Using controls to avoid the cost curveSmarter extremeload handlingExtreme event responseLIDAR feedforward controlsEngineering forextreme events addscost• Goal: engineer for “normaloperation”• Controls reduce extremeloadsLoad case Pareto• Respond faster with earlierfault detection• Intelligent shut-downsequence• Look-ahead 3-5seconds, predict impact• Respond before anextreme eventtime

Tower base bendingTime series wind speed© 2014 General Electric Company12GE Title or job number6/3/2014Paradigm shift in blade constructionRCAF VickersWellingtonFabrics over geodesic airframeCost of energy reduction through:Material & labor cost saving: >20% per bladeOut-of-shell mold blade manufacturing – less P&ELogistics – Field assemblyTunable Blade EngineeringBMW GINA ConceptCarPolyurethane coated SpandexTension StructuresPVC / PolyesterGE SpaceframeTowerPVC coated polyesterfabricsGE Tension Fabric BladeSilicone coatedglass fabricsOptimized FishBoneStructure+© 2014 General Electric Company13GE Title or job number6/3/201415 min30 min1 hour8 hour100 kWh 1 MWh 10 MWhEnergy Level

Discharge Duration10 secEnergy Storage for Utilities10 kWh 100 MWhFrequencyRegulationLoad LevelingMarket ArbitrageDistributedStorageLoad ShiftingInvestmentDeferralRenewableFirming+ -+-+-PowerCapableEnergy CapableCAESFlywheelAdvancedBatteriesUltra CapacitorsThermalGravityP.HydroAdvancedBatteriesPower QualityAncillaryServices© 2014 General Electric Company14GE Title or job number6/3/2014Wind + energy storage*Up to ~2x frequency reg value based on FERC 755 (pay forperformance)Source: FERC, GE MarketingPredictable powerHold output constantRamp control:Store spilled energyFrequency regulation:Fast response© 2014 General Electric Company15GE Title or job number6/3/2014GE’s wind power is brilliantDriving smooth, predictable power, regardless of what mother nature throws ourway• Increasing farm energy output• Improving service productivity• Driving new revenue streamForecastingPark aerodynamics &loads predictionsPark acousticsAnalytics of fleetdataCooperative controlIntegrated energystorage© 2014 General Electric CompanyPolicy Landscape8. Are there state-level or regional renewable policy ortechnology management approaches or systems that couldfacilitate CO2 reductions, and if so, how could they best beentertained and approved in state?10. Could you give us your sense of market/technologyscenarios with and without a production tax credit?17GE Title or job number6/3/201418GE Title or job number6/3/2014The U.S. ... a boom, bust past'01 '02 '03 '04 '05 '06'07 '08 '09 '10 '11 '12'13eU.S. annual industryinstalls• Industry orders down 92% YOY• 3,200 industry layoffs ... 17,000 globally• OEM cuts, closures & delays ... Vestas,Gamesa, Clipper, MHI, Nordex, SiemensPTC volatility puts the industry onpausePTC uncertainty impact on ‘12GW~1,5~10~13© 2014 General Electric CompanySource: AWEARenewables Capacity Deployment7. How do you see renewable capacity deployment in thecoming years as compared to AEO 2013’s reference caseprojections? What renewable technologies do you think wouldbe most attractive to which states in formulating state plans forCO2 compliance?20GE Title or job number6/3/2014Tech. Source2012 2013e 2014e 2015e 2016e

WindAEO 201311.8 0.2 0.3 0.0 0.0Industry13.1 1.5 - 2.0 6.7 – 8.2 4.5 – 7.6 1.5 – 3.5

Solar PVAEO 20132.5 3.3 4.5 4.7 5.3Industry3.2 3.6 – 4.1 4.0 – 5.3 4.2 – 7.0 4.5 – 9.2Notes:1. “Industry” represents ranges from 3rdparty consultant forecasts and are generally aligned with GE expectations2. Forecasting beyond 2015 for wind and 2016 for solar depends primarily upon federal policy outcomesWind:• AEO 2013 assumes no PTC extension• Appears AEO estimates made without considerationof current IRS “start of construction”guidance• Current PTC structure does not have an installation deadline, instead substituting a“continuous efforts” test• Industry consensus is current PTC structure will drive a 15-17 GW market over ‘13-’15timeframe• Low confidence in 2016 industry figure (primarily dependent upon PTCextension or otherpolicy)Solar PV:• AEO 2013 projections are generallyin line with industry expectations• Higher-end projections assume significant growth in roof-top solar applicationsAnnual Capacity Installed(GW)© 2014 General Electric Company21GE Title or job number6/3/2014Wind Resource Map© 2014 General Electric Company22GE Title or job number6/3/2014Solar Resource Map© 2014 General Electric Company23GE Title or job number6/3/2014BACKUP24GE Title or job number6/3/2014486’More than 23,000 units installedgloballyGE wind technologyA single 1.6MW turbine ...• 100 ft longer than wing span ofa Boeing 747• Can power ~700 U.S. homes• Total weight is 510,000 lbs• 100 m rotor ... greater than a football field• Tip speed = 180MPH24© 2014 General Electric Company25GE Title or job number6/3/2014Evolution of GE wind products10,000th1,000th20,000thGE wind products ... proven performance andreliabilityGE Wind Products ‘02 ‘12AEP (GWh/yr)* 6.0 12.6Capacity Factor (%)** 45 60Availability (%) 85 98*2.85-103@8.5m/s, **1.6-100@8.5m/s, EOY ‘12+33%+100%+15%GE enterswind industryGE 37cblade25WindBOOSTLVRT introducedGEPitch5,000thUnits >>Model introduction2.75-1031.6-100HALTIntroducedGE 40m bladeMark VIecontroller1.5i(65m)1.5sle(77m)1.5xle(82.5m)1.6-82.52.75-1002.5xl(100m)2.5s(88m)1.5s(70.5m)1.7-1001.85-82.52.85-1032.5-120Enhanced controlsGE 48.7m bladeNext GenGrid‘02‘96‘07 ‘09‘10‘03 ‘08‘04 ‘05 ‘06‘11 ‘12‘131.85-87© 2014 General Electric Company26GE Title or job number6/3/2014Northwest US• >35 grids ... redundant resources• Regulated ... preferred generation wins• 1hr schedule ...frequency regulation• Hydro ... EPA limits flexibility• Wind as net-load ... high curtailmentAdding grid flexibility requires change...Solutions vary in costUtilize cheapest solutions to minimize integration costWind indispatchNew genbuildNewtransmissionShortenschedulesDemandresponseAncillaryservicesCurtailwindWindforecastShare w/neighborsChangegen ctrlsCompetitivebiddingMidwest US(MISO)• Large ... pooled resources• Competitive ... cheapest generation wins• 5 min schedule ...frequency regulation• Large gas fleet ... very flexible•Wind dispatch ... last curtailedCapacitysignals© 2014 General Electric Company27GE Title or job number6/3/2014Wind is uncertainWind is predictable...as predictable as flipping a light switchWind is a good citizen of the gridChange is normal...as normal as air conditioners turningon/off or generators ramping up/downWind isn’t therewhen it’s neededWindblowsat all times... high capacity factor turbines + goodsiting enables wind power at all hours!Wind concerns are not gridchallengesWind can changerapidlyCONCERNFACTLights stay on w/ recordwind!61%- Xcel (CO)36%- ERCOT (TX)34%- BPA (OR/WA)33%- SPP (NE/KS/OK)25%- MISO(Midwest)*Instantaneous penetration records© 2014 General Electric Company28GE Title or job number6/3/2014Operating wind as a power plantshelps the grid and your economicsAll power plants ...Wind power plants achieve this thru ...1.Commitpower inadvance2.Dispatchpower as gridoperators command3.Regulatetransmissionvoltage4.Stabilizegrid duringdisturbancesForecasting... free wind fuel => 1stcommitted => lower curtailmentPower controls...lower curtailment,add’l revenue oppt’yVoltage controls...interconnect toweak grids, lower curtailmentRide-thru controls... interconnectmore easily and sell power during grid eventsWind is a good citizen of the grid... if it’s allowed to act like a power plant© 2014 General Electric Company