Southern Company Biomass Power Generation RD

1. Presented to SESAF Jeremiah Haswell � Southern Company Phone: 205-257-6309 Email: jhaswell@southernco.com Southern Company Biomass Power Generation R&D

2. Renewable Power Generation Diverse Drivers Resources Responses Next Steps

3. Diverse Drivers Legislation House H.R. 2454 (Waxman-Markey): House reported a comprehensive climate and energy bill on June 26, 2009 Senate S 1733 (Kerry-Boxer): Clean Energy Jobs and American Power Act EPA Greenhouse Gas Regulatory Program 2/2/10 � White House requested $56 million for EPA and states to curb greenhouse gas emissions.

5. Diverse Drivers (cont.) Voluntary Green Programs Existing green energy rates at APC, GPC, and Gulf Economics Certain technologies can be cost competitive compared to controlling older assets. Tax Incentives Sprint to December 31, 2013 Production Tax Credit (PTC) Investment Tax Credit (ITC)

6. Renewable Power Generation Diverse Drivers Resources Responses Next Steps

7. Wind Resource Availability

9. Solar Resource Availability

10. Georgia Power Solar PV Facility Seven different PV technologies Crystalline Si: Poly (Kyocera)* Mono (SunPower)* Mono (Suniva)* Thin film: Amorphous Si (Uni-Solar)* Cadium Telleride (First Solar) Copper Indium Gallium Selenide (Miasole) Mixed format: Heterojunction with Intrinsic Thin Layer (Sanyo)*Seven different PV technologies Crystalline Si: Poly (Kyocera)* Mono (SunPower)* Mono (Suniva)* Thin film: Amorphous Si (Uni-Solar)* Cadium Telleride (First Solar) Copper Indium Gallium Selenide (Miasole) Mixed format: Heterojunction with Intrinsic Thin Layer (Sanyo)*

11. Hydro Electric Alabama 2009 7119 GWh 2008 4334 GWh

12. Biomass Resources

13. Renewable Power Generation Diverse Drivers Renewable Energy Resources Responses � Biomass Next Steps

15. Biomass-to-Power Demonstrations

16. Plant Gadsden Direct Injection System Alabama Power Renewable Energy Rate $2.25 for 50 kWh block Research system � limited to 7,000 lb/hr. Two 1,000-pound bales of switchgrass generate 1,400 kilowatt-hours of electricity - enough to power an average home for a month.

17. Plant Gadsden Direct Injection System Can co-fire up to 10% by energy at low loads, 5% at high loads ~ 3.5 MW Giant Miscanthus Testing � 3/2010

18. Biomass Gasification � TRIG technology PSDF Research in Biomass Gasification Tested Pellet feeding 1Q 2009 Gasification test of 20% by energy in 4Q 2009 UND EERC Gasification Collaboration with EPRI Transport Reactor Development Unit (TRDU)

19. Biomass Gasification � Auburn University Auburn Small Scale Gasifier 25kW Distributed Gasification Trailer Auburn Gasification Lab 150 psi fluid bed gasifier testing to begin on southern & loblolly pine in 1Q 2010

20. Mitchell Biomass Repowering Study Biomass plants have the advantage of being able to be dispatched like typical generation mix Accepted as CO2 neutral More cost competitive than Greenfield sites Direct replacement for coal generation capacity

21. Mitchell Wood yard Concept #1 � Linear Piles

22. Mitchell Wood yard Concept #2Circular Piles

23. Mitchell Unit 3 with DSC Vibrating Hydrograte

24. Plant Mitchell Repowering Capacity: 96 MW net w/ new Stoker Grate and Suspension Firing From 156 MW Net Coal Capacity Approx. 1.1 million ton/yr biomass use 180 trucks per day Emissions SO2 , NOx, & Hg emissions lower 96% Net reduction in CO2 Schedule � (To be Modified!) 8/2008 Filed with GA PSC 12/2008 Air permit filed with EPD 3/2009 PSC Approval, 5 -0 3/2010 Final air permit expected 4/2011 Retrofit construction begins 6/2012 Begin operations

25. Plant Gadsden Co-milling USDA Forest Service co-funded project Biomass from the Talladega National Forest

26. Fuels Tested in Co-milling Pulp and Paper size chips � Big Problems �� minus Whole Tree Chips Pine thinnings Mixed hardwoods Sawdust Urban wood waste Peanut Hulls

27. Various Fuels Used in Co-milling

28. Small Wood Chips Co-milling

29. Biomass Mixing

30. Gadsden CE Mill

31. Co-Milling Test Results Smaller % by energy than originally assumed (1% � 3%) Co-milling limitations are mainly pulverizer related. Amount of spare capacity Wood vs. coal Pulverizer condition Moisture Some added operational expense Emissions were unchanged or slightly lower.

32. Current Biomass Plans GPC Plant Mitchell Retrofit to Biomass firing 96 MW � 1,100,000 green tons per year Southern Power � Nagadoches (Austin, TX) 100 MW � 1,100,000 green tons per year APC Plant Gadsden Continue co-milling of cost competitive fuels Support APC Renewable Energy rate Pursue LFG projects in service territory Gulf Power, Escambia County � 3.2 MW

33. Renewable Power Generation Diverse Drivers Resources Responses Next Steps

35. Looking at 2010 More co-milling trials Higher energy density fuels Larger units Direct Injection studies Repowering studies Ash research Sustainability and fuel supply Gasification studies / trials

36. Summary National RES likely? Biomass is the most economical option in the Southeast. Southern Company must develop a comprehensive list of possible solutions which includes all forms of renewable generation.

37. Questions