Lake Turkana Wind Power Project : Contributions and Lessons Learned Oslo, 28 August 2014

1. Lake Turkana Wind Power Project:Contributions and Lessons LearnedOslo, 28 August 2014

2. Aldwych Overview Aldwych was formed in 2004 to invest in, construct, own and operate power generation, transmission and distribution/ supply businesses in sub-Saharan Africa Aldwych founders and management have international power industry experience and have successfully financed or re-financed twenty power projects worldwide totalling some 11,000MW and US$3.75bn, in both the developed and the developing world Aldwych has completed project transactions in Zambia, South Africa, and Kenya and has advanced projects in Nigeria, Tanzania, Ghana, and South Sudan Investors include the Pan-African Infrastructure Development Fund, FMO, Emerging Africa Infrastructure Fund as well as management

3. LTWP Project Summary • €623 million, 310MW wind farm, located in northern Kenya, near Lake Turkana • The largest single wind farm in Africa and largest private investment in Kenya • Consists of 365 Vestas V52 (850 kV) wind turbines, overhead electric grid connection system and high-voltage sub-station • Includes upgrading of 204km of existing road and village • Double circuit 400kV, 436 km transmission line (financed by Spanish and Kenyan government funds) to connect to national grid • In development since 2006 and originated by KP&P; joined by Aldwych in 2009 • 20-year energy-only PPA with KPLC, Government letter of support backing KPLC’s obligations • Equity includes Norfund and Aldwych as well as KP&P, FinnFund and IFU • Mandated lead debt arrangers: African Development Bank, Nedbank and Standard Bank • Financing documents signed in March 2014 • PRG: African Development Bank; breach of contract insurance: ATI • Aldwych will oversee construction and will operate the plant and will be the largest shareholder

4. Project Location LTWP Location The proposed project is a 310 MW Wind Park to be constructed approximately 450km North of Nairobi The wind farm site, covering 40,000 acres (162km2), is located in Loiyangalani District, MarsabitCounty approximately 50km north of South Horr Township.

5. Wind Regime • The site lies between 450m at the shore of Lake Turkana and 2,300m above sea level at the top of Mt. Kulal. Strong predictable wind streams are generated between Lake Turkana (with relatively constant temperature) and the desert hinterland (with steep temperature fluctuations) • Wind streams pass through the valley which effectively acts as a funnel (the Turkana Corridor low level jet stream). The Turkana wind blows in a south-east direction all year round • Data collected and analysed since 2007 indicate that site has some of the best wind resources in Africa, with consistent, unidirectional, daily wind speeds averaging at least 11 meters/second which will create a 62% capacity factor

6. Contributions to Kenya (1) • Lowering cost of Generation: the tariff at €7.52 cents/kWh ($10 cents) compared to marginal cost of power in Kenya which is $18 cents/kWh • Providing significant power: will be 17% of Kenya’s power generated • Environmental standards: IFC and Equator Principles met with special attention to monitoring during construction • CDM/Carbon offset: It is expected that average annual emission reductions of 728,483 t CO2 per year will be generated during the first crediting period and is certified UNFCCC Gold Standard • Transmission Line Support: • LTWP has dedicated a team for over 2 years to set Ketraco policy and acquire the 436km way-leaves (2,300 plots) toIFC standards • This is supported by a €625,000 grant from Norfund

7. Contributions to Kenya (2) • Macroeconomic contribution: • Will replace Kenya’s to spend of approximately €120 million per year on importing fuel • The LTWP tax contribution will be €22.7 million per year and €450 million over the life of the investment • Jobs - During the 32-month construction period, up to 2,500 jobs followed by over 200 full time jobs throughout the period of operations • Community: • A CSR programme is being finalised based on extensive input from the nomadic and pastoral communities; LTWP will use a combination of revenue from carbon credits and profit to form and fund a trust, which will ensure a well targeted plan over the 20 years of the investment • 204km year round road will open up trade to the area

8. Lessons Learned • Ensure deal fundamentals are best for the country • Must have and maintain political will • Pay attention to community and county government • Oversubscribe debt so lenders do not dictate the terms • Align incentives with developers • Ensure supportive equity structure • Get on the ground alongside your partners • Predict time and resources required and triple the estimate • Have patience – pioneering deals are hard • Find patient partners and work hard at expectation management

9. Next Steps • First equity disbursements in September • Construction to commence shortly thereafter • First 50-90MW due in Q3 2016 • Full commissioning of 310MW in Q2 2017