Overview of Renewable Transactions - cal-cca.org

Overview of Renewable Transactions - cal-cca.org

SECURITIES DIVISION Overview of Renewable Transactions Confidential Prepared by a Goldman Sachs sales and trading desk, which may have a position in the products mentioned that is inconsistent with the views expressed in this material. In evaluating this material, you should know that it could have been previously provided to other clients and/or internal Goldman Sachs personnel, who could have already acted on it. The views or ideas expressed here are those of the desk and/or author only and are not an official view of Goldman Sachs; others at Goldman Sachs may have opinions or may express views that are contrary to those herein. This material is not independent advice and is not a product of Global Investment Research. This material is a solicitation of derivatives business generally, only for the purposes of, and to the extent it would otherwise be subject to, CFTC Regulations 1.71 and 23.605. Nov 6, 2019 SECURITIES DIVISION Financing of Renewable Projects Role of Different Participants Developers Sponsor Back leverage Tax Equity Sponsors Class B Tax Equity Investors Lenders Class A HoldCo Hedge Providers and PPA Buyers Fixed Price ($ / MWh) PPA Counterparty

Power Power, RECs, Capacity Project Company Floating Price ($ / MWh) Grid Operator Renewable Project Goldman Sachs does not provide tax, accounting, investment or legal advice to its clients, and all clients are advised to consult with their own advisers regarding any potential investment/transaction. This material is for discussion purposes only and does not purport to contain a comprehensive analysis of the risk/rewards of any idea or strategy herein. Confidential 2 The Transformation of Renewable Energy Transactions New Structures SECURITIES DIVISION Utility PPA Virtual PPA Bank Hedge Proxy Generation + Volume Firming Counterparty IOUs, munis, CCAs Corporate Off-Takers Banks / marketers with commodity trading desks Weather Investors / Reinsurance Firms

Structure As generated physical As-generated CfD Fixed-volume CfD Proxy gen settled CfD + fixed volume swap Settlement Location Busbar Liquid Trading Hub Liquid Trading Hub Liquid Trading Hub Settlement Volume As-generated Typically as-generated Fixed shape (P90-99) Weather adjusted Proxy generation 15-25 investment years 10clients, 20 Years - 12 Years 10 -15 years Termdoes not provide tax, accounting, Goldman Sachs or legal advice to its and all clients are advised to7consult with their own advisers regarding any potential Confidential

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