January 2012

Healthcare Renewable Energy Initiative (HREI)

2

Topics

1. Introduction / Background

2. Overview of Citi and Practice Greenhealth

3. Healthcare Renewable Energy Initiative (HREI)

1. Introduction / Background

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The Case for Renewables

The Case for Renewables:– Contributes to a clean and sustainable environment and is responsible

citizenship– Projected cost may be lower than projected cost of electricity purchased

off the grid

– Diversifies the health system away from over-reliance on fossil-fuel based grid prices

+ +Increasing Global Energy Consumption

Finite FossilFuel Supplies

Greenhouse GasRestrictions

Increased CostOf Energy=

5

Greenhouse Gas EmissionsFederal legislation is targeting mandated CO2 reductions. There is considerable energy cost uncertainty resulting from meeting these reductions.

DroughtSea Level Rising

Glacier Melting

Species Endangerment Wildfire Proliferation

Warming Trend

6

The Growth of Solar Energy

The advantages of solar power have made it an increasingly appealing option not only for utilities but households and businesses of different sizes

The U.S. solar market has experienced tremendous growth in the past several years– The total size of the U.S. solar market grew 67% from

$3.6 billion in 2009 to $6.0 billion in 2010– Grid-connected PV installations grew 102% in 2010 to

reach 878 MW, up from 435 MW in 2009– Sixteen states each installed more than 10 MW of PV in

2010– As a result, the solar development industry in the U.S.

has grown in both capacity and density, with an increasing supply of power, market integration, and competition

The growth of the solar PV industry has been matched by gains in both efficiency and lower installation costs (which include not only module costs but also labor, overhead, other equipment, etc.) for solar PV developers

0

500

1,000

1,500

2,000

2,500

3,000

2007 2008 2009 2010

U.S. PV Manufacturing Production (Total Units)

0

200

400

600

800

1,000

2005 2006 2007 2008 2009 2010

U.S. PV Installations

Source: Solar Energy Industries Association (SEIA) 2010 Year in Review.

7

Solar Development Across the U.S.California remains the largest solar PV market in the U.S., but other states have experienced faster growth in solar installations.

Source: Solar Energy Industries Association (SEIA) 2010 Year in Review.

B: 41.5%

M: 29.5%

B: 9.4%

M: 34.5%

15.9%26.7%

M: 11.1%

B:

In 2007, only four U.S. states installed more than 10 MW of PV each– In 2010, sixteen states installed more than 10 MW each

In 2004, California accounted for 80% of PV installations in the U.S.– In 2010, less than 30% of PV installations took place in California

Installed PV Capacity in Top 10 States

258.9

137.1

61.4

54.0

53.6

46.8

42.8

35.2

30.7

22.6

8

What is Citi’s View of the Renewable Energy Market?

The current market presents an opportunity for the health system.

As the capital markets eroded in late 2008, financing for renewable projects was significantly impacted– Traditional tax-equity market collapsed as the tax base of financial firms diminished– Debt markets froze due to credit costs and liquidity concerns– Many projects were delayed or postponed due to financing difficulties

With the passage of the American Recovery and Reinvestment Act of 2009 (ARRA), the market is gradually opening– The option to elect the ITC grant has widened the pool of potential investors

Re-entry of financials, developers looking to participate– Debt and credit markets have also started to thaw, particularly for strong credits– Conservative structures with proven technology and strong off-takers will be the norm

The current market reduces the barriers that have previously restricted successful implementation– Efficiency – Implement a structure that is executable today and can be applied across projects– Transparency – Partner directly with financial provider vs. developer intermediary– Cost – Efficiently monetize tax attributes & utilize an integrated financing solution to reduce costs– Long-term Interests – Minimize uncertainty around ultimate cost of equity buy-out

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Federal and State Incentives for SolarFederal and states incentives have catalyzed the development of solar energy and investment in solar power.

Federal incentives– Section 48 of the Internal Revenue Code provides for an Investment Tax Credit (“ITC”) equal to

30% of a project’s “tax credit basis”– Commercial solar property can, with some limitation, be depreciated for tax purposes using a 5-year,

200% declining-balance schedule of deductions under the Modified Accelerated Cost Recovery System (“MACRS”)

– Taken together, the 30% ITC and accelerated depreciation provide a combined tax benefit equal to about 56% of the installed cost of a commercial PV system; moreover, these tax benefits are fully realized within a 6-year period

State and local incentives– Performance-based initiatives (“PBIs”) provide rebates and cash incentives based on system

performance– A number of states have also enacted tax incentives to support solar projects

Federal and state incentives have had a tremendous impact on the growth of the solar industry; in addition, financing structures have been developed to optimize the benefits of these incentives

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Off-balance sheet orOn-balance sheet

Taxable non-recourseOff-balance sheet

Tax-exemptOn-balance sheetDebt

Allows monetization of tax benefits

Municipal equity has option to purchase

Allows monetization of tax benefits

Municipal entity has option to purchase

Forfeiture of federal incentives (1603 grant and MACRS)Other Considerations

YesYesNoMonetization of Tax Benefits/Federal Grant

Low/MediumHigh

(Partner not in business of long-term ownership)

NoneEquity Buy-Out Risk

Medium(Structural complexity; Financing pre-

committed)

High(Structural complexity; Financing pre-

committed, requires sale of non-recourse debt)

Low(Structural simplicity)Execution Risk

LowHighMediumFinancing Cost

Subject to FMV OptionSubject to FMV buy-out optionYesHealth System Ownership

Financing Structure

Citi Tax EquityDeveloper OwnedHealth System Owned (Direct)Description

Tax-Exempt Debt

100%

Tax Equity35%

Project Debt (Taxable)

65%

Tax Equity35%

Health System Debt65%

Renewable Financing Structures

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Barriers to Successful Implementation

In the past, significant barriers have impacted the ability to implement renewables on a wide-scale basis.

Each of these barriers increases costs and reduces transparency,impacting the likelihood of success

Cost / Transparency

ProjectEquipment

LandInstallationMark-up

Developer ProfitFinancing/

Capital Structure

Health System

PPA

Vendor

Health System

EquipmentUpfront Costs

Sta

te

Fede

ral

Loca

l

Health System

PPA

LLC DebtEquity

Construction Loan

Subsidy

Capital StructureBusiness Models

What is the real cost?

How do you maximize the value of subsidies?

Is the structure executable?

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Firm Primary Roles Noteworthy Transactions

Recurrent Developer/Owner/Operator VF Outdoor PPA (1.19 MW)City of San Francisco (5 MW)

Tioga Developer/Owner/Operator Sutter Auburn Faith Hospital (736 kW)City of Santa Barbara (384 kW)

Regenesis Developer/Owner/Operator Meadows Field Airport (870 kW solar array field)Florida Gulf Coast Univ. (2 MW solar farm)

MMA Developer/Owner/OperatorProvider of debt and equity financing to other integrators Global Solar (750 mw thin film system)

Optisolar Developer/Owner/OperatorManufacturer

Topaz Solar Farm (550 MW)Sarnia Solar Farm (60 MW)

Solar City Developer/Owner/Operator Livermore (528 kW)Yuba City (394 kW)

HelioPower Developer/Owner/Operator Sunnyland Mills (90kW)

SunTech Developer/Owner/OperatorManufacturer

3rd Rock Systems (7.2 MW panel supply agreement)Standard Solar (5 MW panel supply agreement)

SunPower Developer/Owner/OperatorManufacturer

California Valley Solar Ranch (250 MW)Lake County, CA (2.2 MW system)

Manufacturer Southern California Edison (2 MW) Sempra Energy (10 MW)

eSolar Developer/Owner/Operator Southern California Edison (245 MW)

Ecogy Developer/Owner/Operator N/A

Commoditized Solar Development MarketAs a large number of competitors have entered the solar market, the industry has become increasingly commoditized.

2. Overview of Citi and Practice Greenhealth

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Citi’s Commitment to Environmental Stewardship

http://www.citigroup.com/citi/environment/climateposition.htm

A roadmap for banks and U.S. Power Producers to reduce the regulatory and

financial risks associated with greenhouse gas emissions

Citi Partners & Initiatives

Citi has taken concrete steps to address & mitigate climate change by:

Targeting a $50 billion investment over 10 years: includes significant increases in investment and financing of renewable projects, clean technology, and other carbon-emission reduction activities

Committing to reduce GHG emissions of all Citi owned/leased properties worldwide by 10% by 2011

Purchasing 132,000+ MWh of clean energy for our operations in 2008

Creating Sustainable Development Investments that make private equity investments in renewable energy and clean technologies

Providing lending and investing services to clients for renewable energy development

Producing equity research related to climate issues that helps to inform investors on associated risks and opportunities

Engaging with a broad range of stakeholderson the issue of climate change to help advance understanding and solutions

* Citi’s 2008 Citizenship Report, which details Citi’s progress with our renewable initiatives is available upon request and on the web at http://www.citigroup.com/citi/citizen/annualreport08.htm.

Citi was the first US financial institution to release a Climate Change Position Statement

Citi’s renewable mandate starts at the top of the firm.

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Citi is recognized for its commitment to environmentally responsible finance

Citi is Recognized as a Leader in Renewables

The Banker Magazine has named Citi “Most Innovative Bank in Climate Change and Sustainability” for the second year in a row

Named “America’s Greenest Bank” by Bank Technology News

Citi has committed $24 billion of its announced $50 billion commitment to address global climate change

“Citi has built a substantial track record in environmental sustainability in the last decade. We take great pride in the fact that focusing on

sustainability is a priority for our businesses and is consistent with our commitment to Responsible Finance”

- Vikram Pandit

“Winning for the second year in a row is an honor and a tremendous validation of the work we do for our clients around the world”

- Sandip Sen (Citi Alternative Energy)

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Citi’s Experience in Renewable EnergyCiti’s renewable structuring expertise spans a variety of transaction structures, legislative paradigms, and sectors.

Citi has served in a variety of roles:– Equity investor– Underwriter– Credit provider

Citi has been involved with transactions structured as:– Partnership flips– Sale-leasebacks– Pre-paid PPAs– Traditional ownership

Our experience has allowed us to adapt structures to succeed in an ever changing marketplace. Examples include:– Optimizing between tax-exempt debt and tax-

equity partnership structures – Adapting structures to take advantage of new

programs available under the ARRA

Select Citi Renewable Transactions

50% equity investor in largest solar installation in the western hemisphere. Closed Dec 2007

Awarded deal to arrange financing on up to 100mW wind project.

Closed October 2010

Structured/Equity Investor in innovative solar lease financing.

Closed June 2010

Structuring advice / equity investor on 15 MW solar program. Closed

April 2010

Lead underwriter on $400mm wind power financing. Closed

Feb 2009

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Overview of Practice GreenhealthPractice Greenhealth – the voice for sustainability in health care.

Practice Greenhealth is the nation’s leading membership and networking organization for healthcare institutions that are committed to implementing sustainable, eco-friendly practices

Demonstrating the growing commitment among the health community to reduce its environmental impact, Practice Greenhealth membership continues to expand, now representing 1,000+ member hospitals nationwide – approximately 20% of the hospitals in the U.S.

Of the top 20 U.S. News & World Report listing of the best hospitals in the country, two-thirds are members of Practice Greenhealth

Practice Greenhealth is a learning community working toward the greening of healthcare offering the next generation of tools and services that can take organizations, wherever they are on the continuum, to the next level of sustainability excellence

Beyond helping members establish goals and best practices, Practice Greenhealth is widely recognized for leadership in developing specific programs, tools and services – assistance in reaching those goals

3. Healthcare Renewable Energy Initiative (HREI)

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HREI OverviewThe Healthcare Renewable Energy Initiative – an executable and cost-effective financing program for renewable projects.

Practice Greenhealth, in partnership with Citi, is introducing the Healthcare Renewable Energy Initiative (HREI), an offering of transparent and flexible financing options

The HREI is a superior alternative for hospitals because it provides:

– Certainty of execution– Low-cost and certain financing– Full transparency– Flexibility on transaction structure and technology– Two trusted partners in Practice Greenhealth and

Citi, both with longstanding track records of serving the leading hospitals, in both green initiatives and financing

Hospital

HREI

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HREI promotes renewable energy implementation through an efficient, flexible, and transparent process.

HREI involves two phases: – An independent engineering firm will conduct a thorough analysis of the potential feasibility of

renewable energy alternatives for the hospital, based on an analysis of the physical plant and existing energy use patterns.

– If the engineering assessment indicates potential feasibility, Citi will work with the hospital to assess, finance and implement the most cost-effective structure that enables the hospital to purchase green energy. In most cases, the most cost-effective structure to achieve these goals is a Power Purchase Agreement (PPA).

The initial program will be piloted in New Jersey and Massachusetts, where current state subsidies enable hospitals to utilize solar power to save money, hedge energy costs and reduce their carbon footprint

– Scalability to other states will continue to be assessed

HREI Overview (continued)

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Benefits of Disaggregation

Disaggregating the components of each solar project represents the best value to the health system.

Citi understands the health system’s organization and credit

Citi is willing to put its own equity at risk– Citi can provide transparency and align our interests with the health system

Citi’s understanding of the health system’s credit allows us to access financing at more favorable terms

Citi can structure leverage which provides the greatest certainty of execution

The solar development market is becoming increasingly commoditized– Citi can bid out the modules and installation for each site, securing the lowest installed cost for the

health system

The overall goal is to provide complete transparency to the health system, and allow Citi and the health system to work together to maximize the value of each component

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HREI Financing Approach

Citi is ready to provide an executable and cost effective financing program for renewable projects

The HREI program provides an integrated solution for distributed solar– Combines both tax credits and tax-exempt financing to

result in the lowest overall cost of power– Applicable to both utility scale and smaller projects

Under the program, Citi would provide 100% construction financing and tax-equity investment/syndication

– No upfront investment from the health system

– Citi will incorporate third-party financing when most efficient for the health system

Health system retains ownership option at the end of the compliance period

– Citi as equity investor does not want to own projects beyond 5 years

– Alignment of ownership interests with client

– Recent IRS guidelines appear to permit fixing of buyout price at inception based on expected fair market value

- Ability to implement over time

- Ability to scale- Ability to group projects- Long-term savings

Health System Benefits

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HREI Financing Approach (continued)

The HREI approach is designed to:– Provide for greater cost savings– Provide for health system ownership option after compliance period– Provide for greater health system control– Provide for greater ease of implementation

Provides a lower cost bridge to the health system’s ownership of the project– Financing approach is a mechanism to allow the health system to benefit from the tax attributes of the

project– Citi’s objective is to own the project during the compliance period, earn a pre-determined return, and

pass all associated project benefits on to the health system and the project participants– Citi has no desire for long-term project ownership

Provides for greater control and ease of implementation– Like traditional projects, the health system can work independently or with developers to ensure the

project meets resource objectives– Financing mechanism is transferable - approach is not dependent on any technology, site or vendor

and allows for aggregation of projects

The health system can maximize its value by separating the financing from the project development.

Citi’s approach is designed around the idea of creating the lowest possible cost of power, while also providing for the health system’s ownership of the project, if desired

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Construction Finance Solar ModulesTax Equity Debt Finance

Day-to-Day TeamCapital MarketsPublic Power

Citi’s Proposed RoleBy procuring the best panels and capital, Citi can optimize each project for the health system going forward.

Solar Project

Solar Consultant

Other Market Participants Other Market Participants

Health System

Other Market Participants

Health System

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PPA OverviewThe Citi Power Purchase Agreement (PPA) is a long-term agreement to buy electricity (kilowatt hours or kWh) at a pre-determined price

– In this case, kWh come from an on-site solar system

The health system agrees to buy 100% of the kWh generated– The health system does not pay for power that is not

produced– Not like a lease with fixed payments

Citi manages all financial and operational risks– Financing, building, owning, operating, and maintaining

the solar system

Key Terms• Term Length

• Standard 20- and 25-year options

• Initial Rate• Measured in $/kWh, the first

year’s rate includes all financial incentives and risks

• Rate can be competitive with utility-provided retail power rates

• Escalator • Measured in %, this reflects the

annual increase in the initial rate

• End of contract options• Renew the PPA, or• Remove the system at provider’s

cost, or • Buy the system at fair market

value (FMV)

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Not All PPA’s Are Created EqualCiti’s experience is that developers are signing PPAs with little ability to execute– Construction costs– Siting– Transmission– Permitting– Financing– Equity– Integration of local taxes and incentives

These assumptions will lead to increasing PPA defaults

Citi’s approach is designed to reduce execution risk– Commitment of capital– Standard documentation– Ability to use exiting vendors or turnkey PPA– Internal diligence on developers, technology &

construction

- Transparency- Increased negotiating

power- Confidence in project

actually being built- Lower cost of power- Direct path to ownership

What Does Citi Offer?

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Scalable Financing Program – Master PPA/Lease

Integrated financing solution– Construction lending from Citi

and/or note financing– Take-out financing from Citi– Purchase Option

Standardized documentation:– Separate Project LLCs would be

created which would be purchased by Holdco LLC at term financing date

– A Holdco LLC would own all projects at commercial completion

Sufficient flexibility within the Master documents regarding approved vendors, equipment, and pricing parameters

Streamline the approval process and ease implementation

Citi’s approach can also provide flexibility to work as an ongoing program across multiple sites

O&MMaster PPA

PPA

Con

firm

s

PPA

Con

firm

s

PPA

Con

firm

s

PPA

Con

firm

s

Project LLC

Construction Loan from Citi and/or

Note

Health System

Master Site Lease

Host Site

Host Site

Host Site

Host Site

EnergyEnergy

$ $

$

Completion Gty

Contractor

$RenewableFacility

EPCContract

3rd Party O&M

Provider$

PPA

Con

firm

s

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Relationship Between Production Efficiency and Installed Cost

Production Efficiency (kWh/kWp)

Inst

alle

d Co

st ($

/Wat

t DC

)

$0.10/kWh $0.12/kWh $0.14/kWh

Screening Process for Site SelectionCiti has developed a model to evaluate the economic viability of each site. This tool can be used to guide the bidding process as well as compare the relative costs of different technologies.

Citi has analyzed the relationship between production efficiency, avoided cost, and installed cost– Production efficiency is determined by the specific conditions of each site (available space,

insolation, etc.)– Avoided cost is typically determined by local utility rates and facility usage patterns– Based on these factors, Citi’s pricing model can determine a feasible installed cost

For illustration purposes only.

Site #1: Fuel Cell

Site #3: Elevated Solar

Site #2: Ground Mount

• Site #1: Viable if avoided cost > $0.10/kWh

• Site #2: Viable if avoided cost > $0.14/kWh

• Site #3: Not viable based on avoided cost of $0.14/kWh

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Competitive Bidding on Modules

Citi can design and conduct a bidding process that results in the optimal selection of developers.

Citi will assess the viability of each project site

For each selected site, a set of specifications will be sent to each qualified bidder

Responses are subject to standard documentation and PPA structure– A similar set of responses allows the health system to easily assess the values of each proposal– Standard documentation and PPA structure enable each project to be implemented efficiently

Because Citi will source the debt and equity financing, each developer can focus solely on the hardware and installation

A competitive bidding process can minimize the installed cost while maintaining optimal PPA pricing terms and legal protections for the health system

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Citi’s Equity Provides Certainty of ExecutionCiti is willing to invest with equity in each project, aligning our interests and providing protection to the health system.

In the current market, project finance remains the most significant barrier to implementation

Citi can invest in a wide range of structures, optimized for each project site

Citi’s interests are aligned with the health system’s – the desire to complete each project in a streamlined and efficient manner

Citi acts solely as an equity investor, with no long-term desire to own the power producing assets– Citi can work with the health system to achieve the most favorable and lowest-cost buyout options– Buyout value calculations are transparent

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FMV 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Fair Market Value Purchase OptionUnder Citi’s approach, a buyout option is retained at the end of the compliance period (year 6) – Direct path to ownership at inception of the project(s)– Fixed at inception based on an estimate of expected fair market value (“FMV”)

Fair Market Value is defined as:– “the price at which the property would change hands between a willing buyer and willing seller, neither

being under any compulsion to buy or to sell and both having reasonable knowledge of relevant facts.”

For renewable projects, FMV is generally derived from two components:– Discounted remaining in-place cash-flows– Any residual value of asset

Fair Market Value Calculation

Remaining Cash Flows Under PPA Residual ValuePurchase

Option Date

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Sample Procurement Process

Citi can standardize the site assessment, award, and pricing process.

1. Assess potential sites

2. Send RFP to qualified bidders

3. Utilize Citi models to develop PPA pricing

4. Award pricing with standard term sheet

5. Source financing

6. Execute project

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Financing TransparencyCiti will work with the health system to analyze the various components of each transaction to ensure efficient execution

The Citi approach separates the financing from the capital budget

– Provides transparency– Allows the health system to better

understand the cost drivers of each transaction

Citi has extensive experience developing renewable financing models that include all components of the transaction, including;

– Panels Cost– Installation Cost– Panel Efficiency – Construction Financing– Term Debt– Tax Credit Equity Investment

Citi can customize the financing structure for the specific requirements of each project

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Standardized Documentation Eases ImplementationFundamental to the success of the program will be putting in place a scalable structure while streamlining the approval and execution process.

One master Solar LLC to own all solar projects originated during a specified period up to a maximum size

Pre-committed Citi construction loan and tax equity commitment that would fund each project based on minimum draw sizes once specific conditions are met, including:– Proper permitting– Project meets development standards including equipment and insurance– Project-specific schedules executed– Project meets ITC-grant criteria

Standardized master documents supported by individual schedules for each new project– Master Site Lease– Master PPA with specific committed timing for pre-payment to retire construction loan– Master Engineering, Procurement and Construction (EPC) Contract– Master Construction Completion Guarantee– Master Operating and Maintenance Contract

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Citi’s Ongoing Role

• Source best and lowest-cost panels• Maintain competitive array of developers and

manufacturers

• Work with the health system to run RFP for modules

• Maintain relationships with capital sources• Assemble deals under optimal structure for the

health system• Access lowest-cost capital

• Utilize “Master PPA” template

• Optimize risk parameters• Tailor transactions to optimize economics to the

health system

• Best pricing and product

• Competitive process = best outcome and full transparency

• Leverage the health system’s credit as effectively as possible

• Ensure complete transparency

• Reduce transaction costs, streamline

• Ensure transactions comply with all broader Treasury objectives

• Invest directly, where appropriate • Optimize health system-Citi relationship via “skin in the game”

Citi Roles Benefit to the Health System

4. Case Studies

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Kaiser PermanenteKaiser Permanente closed a landmark transaction for a 15MW solar PV project on 15 sites. Citi served as structuring agent and also invested equity in three of the sites

Transaction Details

Off-Take Kaiser Permanente

Megawatt Capacity 15 MW

Structure PPA

Technology Solar Photovoltaic

Project Size 15 Sites

Project HighlightsNo upfront capital expenditure

Facilities are placed in holding companies, with Kaiser purchasing 100% of the energy generated on a take-and-pay basis

15 sites throughout California; 3 sites in Northern California including Vallejo and Santa Clara Medical Centers; and 12 in the south including Fontana and San Diego Medical Centers

Through the transaction, Kaiser was able to:– Hedge future energy prices in a fixed-price 20-year contract (with buy-out

rights @ 7 and 10 years)– Generate approximately 23 GWh of electricity annually, a substantial

piece of Kaiser's on-site renewable energy goals– Citi worked carefully with Kaiser and Recurrent Energy to design a

structure that had substantial benefits from both a cost and risk perspective

Kaiser Santa Clara 1 MW site (Artist Depiction)

Asset Location

38

Somerset County Improvement AuthorityCiti recently closed a 7.6 MW solar PV project on 31 sites for Somerset County, NJ

Off-Take Somerset County NJ

Megawatt Capacity 7.6 MW

Structure PPA

Technology Solar Photovoltaic

Project Size 31 Sites

No upfront capital expenditure for any of the participating local governments

Facilities are leased by a Citi and Vanguard Energy Partners partnership

31 sites throughout Somerset County in 15 school districts; sites include rooftops less than 10 years old as well as some ground-level areas such as parking lots

Citi/Vanguard has the option to purchase facilities for $1 at the end of the 15 year lease term

Through the transaction, Somerset County will be able to:– Hedge future energy prices in a fixed-price 15-year contract (with a fixed

price purchase option at end of contract)– Initial pricing at $0.048 kWh with annual escalation of 2.75%– Save taxpayers over $18 million over the term of the PPA and avoid an

estimated 15 million pounds of carbon emissions annually

Completed Construction at Franklin Park Elementary School

Transaction Details Project Highlights

Asset Location

39

Nellis Air Force BaseCiti committed to the United States solar market in 2007, with an equity investment in the 14 MW solar power installation at Nellis Air Force Base (“NAFB”) in Nevada

Transaction Details

Off-Take Nellis Air Force Base

Megawatt Capacity 14 MW

Structure PPA

Technology Solar Photovoltaic

Project Size $131mm

Asset Location

"This base serves as a shining example of what's possible when we harness the power of clean, renewable energy to build a new firmer foundation for economic growth”

- President Barack Obama, May 27, 2009

Project HighlightsProject had no upfront capital expenditure from NAFB

Facilities are owned by Citi, Allstate and Fotowatio Renewable Ventures (the managing member)

One of the largest PV solar installations in the United States at the time, the project was expected to save the United States Air Force approximately $1 million annually in electricity costs

The project utilizes approximately 72,000 solar panels that cover nearly 140 acres of land and provide about 25% of the total electricity for the base

Project has outperformed original production projections thus far

Project produces enough energy to power about 13,200 homes during the day and offsets carbon pollution equivalent to removing 4,000 cars

efficiency, renewable energy & mitigation

In January 2007, Citi released a Climate Change Position Statement, the first US financial institution to do so. As a sustainability leader in the financial sector, Citi has taken concrete steps to address this important issue of climate change by: (a) targeting $50 billion over 10 years to address global climate change: includes significant increases in investment and financing of alternative energy, clean technology, and other carbon-emission reduction activities; (b) committing to reduce GHG emissions of all Citi owned and leased properties around the world by 10% by 2011; (c) purchasing more than 52,000 MWh of green (carbon neutral) power for our operations in 2006; (d) creating Sustainable Development Investments (SDI) that makes private equity investments in renewable energy and clean technologies; (e) providing lending and investing services to clients for renewable energy development and projects; (f) producing equity research related to climate issues that helps to inform investors on risks and opportunities associated with the issue; and (g) engaging with a broad range of stakeholders on the issue of climate change to help advance understanding and solutions.

Citi works with its clients in greenhouse gas intensive industries to evaluate emerging risks from climate change and, where appropriate, to mitigate those risks.

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