Benefical Use of Digester Gas Point Loma Wastewater Treatment

PlantIndustrial Energy Association

April 8, 2015

BioFuels Energy, LLC (“BFE”) has secured long term bio-gas rights from the Point Loma Wastewater Treatment Facility.

(By-product of competitive RFQ/RFP Process) BFE purifies the digester gas such that the end product

meets the new SDG&E pipeline injection standards (Rule 30) [First project in the State of California to do so]

BFE nominates the cleaned biogas (“directed biogas”) to the BioFuels customers and provides renewable energy under a long term Power Purchase Agreement:• University of California San Diego (2.8 MW)• City of San Diego South Bay Water Reclaimation

Plant (1.4 MW) $45 M Total Capital Cost

DigestersDigesters

Gas FlaresGas Flares

ProposedProposedBUDG SiteBUDG Site

GUFGUF

Point Loma WastewaterPoint Loma WastewaterTreatment Plant (PLWTP)Treatment Plant (PLWTP)

PLWTPPLWTP

Point Loma Project Timeline

City Issues RFQ for Digester Gas …………. Jan. 2007 BUDG Biogas Agreements Executed………… Oct. 2007 Completed Project Financing………………. Nov. 2, 2010 Initiated Construction ……………………….. Dec. 2010 Fuel Cells Delivery …………………………. August 2011 Complete Construction ………………………... Dec. 2011 Operation/Maintenance NTP …………………. Jan. 2012 (started 10 year term)

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BUDG Site

Southside PLWTP

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BioFuels Energy’s Pt. Loma Biogas Facility

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BUDG SIMPLIFIED PROCESS CHAIN

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San Diego Gas & Electric Rule 30 Biomethane Gas Delivery

Specification PUC Approved and Issued August 27, 2009 Approval of subsequent SDG&E Advise

Filing defines “biogas” as being derived from renewable organic sources.

98% methane requirement (98.1% avg. actual)

Water Vapor 7 lb/MMscf or less Oxygen .2% or less (.1%) Total Sulfur .75 gr. S/100 scf Others- CO2 (.5%) - N2 (1.3%)

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Continuous Biogas Monitoring Equipment

Moisture & CO2 Analyzer O2 Analyzer Gas Chromatograph Sulfur Chromatograph H2S Monitor Flow Measurement Temperature/Pressure Heat Content (every few minutes)

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South Bay 1.4 MW Fuel Cell

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UCSD 2.8 MW Fuel Cell

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The Directed Biogas Nomination Process

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Mar-2015

P001- BioFuels Point Loma, LLC        Cumulative Imbalance Nomination Fuel Loss Net Sched Delivery Operational Imbalance

Carryover (161.9) S 1-Mar (161.9) 800 (3) 797.0 254.3 (707.6) M 2-Mar (707.6) 800 (3) 797.0 722.1 (785.5) Tu 3-Mar (785.5) 600 (2) 598.0 563.8 (821.7) W 4-Mar (821.7) 600 (2) 598.0 552.4 (869.3) Th 5-Mar (869.3) 450 (2) 448.0 567.4 (751.9) F 6-Mar (751.9) 450 (2) 448.0 59.1 (1,142.8) S 7-Mar (1,142.8) 300 (1) 299.0 215.3 (1,227.5) S 8-Mar (1,227.5) 300 (1) 299.0 804.6 (722.9) M 9-Mar (722.9) 300 (1) 299.0 807.4 (215.5) Tu 10-Mar (215.5) 600 (2) 598.0 793.3 (22.2) W 11-Mar (22.2) 500 (2) 498.0 701.8 179.6 Th 12-Mar 179.6 500 (2) 498.0 694.3 373.9 F 13-Mar 373.9 800 (3) 797.0 624.9 198.8 S 14-Mar 198.8 725 (3) 722.0 152.0 (374.2) S 15-Mar (374.2) 725 (3) 722.0 677.7 (421.5) M 16-Mar (421.5) 725 (3) 722.0 745.6 (400.9) Tu 17-Mar (400.9) 597 (2) 595.0 724.2 (273.7) W 18-Mar (273.7) 600 (2) 598.0 729.5 (144.2) Th 19-Mar (144.2) 600 (2) 598.0 114.6 (629.6) F 20-Mar (629.6) 600 (2) 598.0 333.9 (895.7) S 21-Mar (895.7) 700 (3) 697.0 700.8 (894.9) S 22-Mar (894.9) 691 (3) 688.0 715.3 (870.6) M 23-Mar (870.6) 700 (3) 697.0 629.4 (941.2) Tu 24-Mar (941.2) 386 (1) 385.0 713.4 (613.8) W 25-Mar (613.8) 400 (1) 399.0 657.0 (356.8) Th 26-Mar (356.8) 400 (1) 399.0 611.2 (145.6) F 27-Mar (145.6) 400 (1) 399.0 481.4 (64.2) S 28-Mar (64.2) 724 (3) 721.0 275.2 (513.0) S 29-Mar (513.0) 725 (3) 722.0 731.9 (506.1) M 30-Mar (506.1) 725 (3) 722.0 694.1 (537.0) Tu 31-Mar (537.0) 600 (2) 598.0 642.4 (494.6)

Totals 18,023.0 (67.0) 17,956.0 17,690.3 (494.6)

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SD209 - UC San Diego Fuel Cell SD207 - City of San Diego Fuel Cell**Green Usage Brown Cumulative Brown **Green Usage Brown Cumulative Brown

542 543.5 1.5 1.5 255 226.0 (29.0) (29.0) 1 542 542.4 0.4 1.9 255 239.4 (15.6) (44.6) 2 407 541.7 134.7 136.6 191 247.9 56.9 12.3 3 407 541.9 134.9 271.5 191 248.7 57.7 70.0 4 305 542.1 237.1 508.6 143 247.9 104.9 174.9 5 305 541.1 236.1 744.7 143 248.5 105.5 280.4 6 203 541.0 338.0 1,082.7 96 248.0 152.0 432.4 7 203 542.1 339.1 1,421.8 96 247.1 151.1 583.5 8 203 544.7 341.7 1,763.5 96 247.4 151.4 734.9 9 407 543.1 136.1 1,899.6 191 248.5 57.5 792.4 10 339 543.1 204.1 2,103.7 159 248.7 89.7 882.1 11 339 542.3 203.3 2,307.0 159 248.1 89.1 971.2 12 542 260.1 (281.9) 2,025.1 255 248.9 (6.1) 965.1 13 491 452.3 (38.7) 1,986.4 231 247.2 16.2 981.3 14 491 523.1 32.1 2,018.5 231 248.2 17.2 998.5 15 491 538.9 47.9 2,066.4 231 248.9 17.9 1,016.4 16 405 541.8 136.8 2,203.2 190 248.9 58.9 1,075.3 17 407 540.9 133.9 2,337.1 191 248.9 57.9 1,133.2 18 407 542.4 135.4 2,472.5 191 248.1 57.1 1,190.3 19 407 542.8 135.8 2,608.3 191 247.6 56.6 1,246.9 20 474 541.5 67.5 2,675.8 223 247.6 24.6 1,271.5 21 468 542.3 74.3 2,750.1 220 247.5 27.5 1,299.0 22 474 542.7 68.7 2,818.8 223 247.3 24.3 1,323.3 23 262 398.8 136.8 2,955.6 123 247.4 124.4 1,447.7 24 271 497.6 226.6 3,182.2 128 246.9 118.9 1,566.6 25 271 543.6 272.6 3,454.8 128 246.7 118.7 1,685.3 26 271 543.4 272.4 3,727.2 128 247.1 119.1 1,804.4 27 490 545.1 55.1 3,782.3 231 247.8 16.8 1,821.2 28 491 544.5 53.5 3,835.8 231 248.4 17.4 1,838.6 29 491 543.7 52.7 3,888.5 231 247.9 16.9 1,855.5 30 407 544.2 137.2 4,025.7 191 248.7 57.7 1,913.2 31

12,213.0 16,238.7 4,025.7 5,743.0 7,656.2 1,913.2

Significant Biogas Project Issues

Variability of Digester Gas Supply in establishing Plant Capacity (Design for swings vs average)

Interface with existing site flares Responsibility for installation of utility

gas interconnection Location of Gas Extraction Location

(impact on digester dome pressure)

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Challenges toExpanding/Developing Biogas

Projects Cost of Biogas interconnect too high and installation

is provided on a cost plus basis from the utility Interconnect $1.084M/$8.119M – actual $ 1.99M Uncertainty over requirement for new BTU District Challenge of matching significantly reduced natural

gas prices; renewable premium not sufficient to cover price differential

No long term market for RINS Impact on operation of continuous siloxane

monitoring Changing Biogas Quality Injection Requirements Difficulty of securing a guarantee to meet Rule 30 Reduced SGIP/Grant Incentives

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Alternate Uses for Renewable Biogas

Renewable CNG as a Transportation Fuel

As “Directed Biogas” for use in new Energy Generation Facilities

For Sale to Investor Owned Utilities as Fuel in existing generation units to meet RPS goals

For Sale to Commercial, Industrial, & Institutional Customers (boiler or generation applications)

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Thank You,

BioFuels Energy, LLCFrank J. Mazanec, Managing Director

(760) 420-9600