IFC-BPI SEFRMC 01/10

FINANCIAL ANALYSIS MODEL

COMPANY NAME: ABC Country: PhilippinesProject: 10 MW Coal-fired Tri-generation plant Primary Fuel: CoalLocation: Sta Rosa, Laguna Date: 24-Nov-10Case: Base case, captive trigeneration

SUMMARY OF ASSUMPTIONS and RESULTS

COGENERATION PLANT OPERATION USES OF FUNDS (Project Cost)Operating Days per Year days 312 000 PHP 000 USD Total in '000 PHPOperating Hours per Day hours 24 Investment CostsOperating Hours per Year hours 7,488 Development 921 40,535 Gross Power Generation (max) MW 11.200 EPC including BOP, civil works and structures (USD/MW) 1,618 18,125 797,500 Parasitic Load (%) 10.00% MW 1.120 (Erection, Installation and Commissioning) 0 Net Power Generation (max) MW 10.080 Land (PhP/Ha) 2,000,000 12,000 12,000 Boiler Capacity (92 bar, 535°C) tph 72 Interconnection to the system 300 13,200 Steam for process tph 23 Mobilization and Start-up Costs 1,450 63,800 Steam for cooling tph 6 Site Preparation 9,000 9,000 Average Electrical Load Factor % 85.48% Construction time insurance,% of EPC cost 5.00% 906 39,875 Average Steam Utilization Factor (Process) % 72.66% Import Duty, % of foreign EPC cost 1.50% 272 11,963 Average Steam Utilization Factor (Cooling) % 76.93%

Output Utilisation No. of Units Unit Cost in PHP Escalation SUB-TOTAL 975,910 Electricity Savings (MWh) 64,519 6.5000 5.00% Contingency 5.00% of sub-total 48,796 Savings on steam used in processing (tons per year) 125,134 1.600 3.00% Total Investment Costs thousand PHP/MW 91,492 1,024,705 Savings on steam used in cooling (tons per year) 34,564 1.600 3.00%

Fuel Consumption LHV (MJ/kg) Tons per year PHP per ton Financing Costs during ConstructionPrimary (Coal) 26.00 116,029 2,000 Interest Costs 57,384 Secondary 0.00 0 0 Financing Fees 0

0.00 0 0 Total Financing Costs during Construction 57,384 TOTAL USES OF FUNDS (Project Cost) 1,082,089

OPERATING COSTSTotal in '000 PHP Total in '000 USD Escalation SOURCES OF FUNDS

Administration 4,253 97 3.00% Equity 30.00% of project cost 307,412 O&M - 4% of EPC 27,913 634 3.00% Grant 0 O&M - others 0 5.00% Loan* 774,677 Primary Fuel - Coal 232,058 5,274 6.00% TOTAL SOURCES OF FUNDS 1,082,089 Secondary Fuel 1 0 0 0.00%Secondary Fuel 2 0 0 0.00% *LoanInsurance 3,988 91 5.00% Grace Period 1 Consumables and Other Costs 1,418 32 5.00% Repayment Period 10

Base Interest Rate 8.00%GENERAL and ECONOMIC DATA Lender's Margin 0.00%

Plant Life (years) years 25 All-in Interest Rate 8.00%Depreciation Policy straight line Interest rate during Construction 8.00%Corporate Tax Rate (year 1-7) % 0.00% Financing Fees 0.00%Corporate Tax Rate (year 8 onwards) % 10.00%National Currency PHPCurrency Exchange Rate PHP/USD 44.00 Discount Rate % 8.00%

PROJECT PERFORMANCE ANNUAL DEBT SERVICE COVERAGE RATIOSNominal Pre-Tax Project IRR 18.12% Minimum AverageNPV - Cash Flow Before Debt Service (Interest + Principal) and Tax (in '000 PHP) 1,234,831 Pre-Tax Cash Flow CoverageNominal Post-Tax Project IRR 17.61% of Interest 0.00 6.68 NPV - Net Cash Flow Before Debt Service (Interest + Principal) (in '000 PHP) 1,122,802 of Debt Service 0.00 1.44 Nominal Equity IRR (Post-Tax) 24.08% After-Tax Cash Flow CoveragePay-back Period (yrs) 7.90 of Interest 0.00 6.37

of Debt Service 0.00 1.41

CEPALCO - SolarRMC 06/06

FINANCIAL ANALYSIS MODEL

COMPANY NAME: ABC Country: Philippines

Project: 10 MW Coal-fired Tri-generation plant Primary Fuel: Coal

Location: Sta Rosa, Laguna Date: 24-Nov-10

Case: Base case, captive trigenerationv1

CASH FLOW STATEMENTIndexationYear 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27Operating Year -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25Revenues

Electricity Sales - in house 419,374 440,343 462,360 485,478 509,752 535,239 562,001 590,101 619,606 650,587 683,116 717,272 753,135 790,792 830,332 871,848 915,441 961,213 1,009,273 1,059,737 1,112,724 1,168,360 1,226,778 1,288,117 1,352,523 Steam Sales for process- in house 200 206 212 219 225 232 239 246 254 261 269 277 285 294 303 312 321 331 341 351 362 372 384 395 407 Steam Sales for cooling- in house 55 57 59 60 62 64 66 68 70 72 74 77 79 81 84 86 89 91 94 97 100 103 106 109 112

Total revenues 419,574 440,549 462,572 485,697 509,977 535,471 562,240 590,348 619,860 650,848 683,385 717,549 753,421 791,086 830,635 872,160 915,762 961,544 1,009,614 1,060,088 1,113,086 1,168,733 1,227,162 1,288,512 1,352,930 Operating Expenses

Administration (4,253) (4,381) (4,512) (4,647) (4,787) (4,930) (5,078) (5,231) (5,388) (5,549) (5,716) (5,887) (6,064) (6,246) (6,433) (6,626) (6,825) (7,030) (7,240) (7,458) (7,681) (7,912) (8,149) (8,394) (8,645)O&M - 4% of EPC (27,913) (28,750) (29,612) (30,501) (31,416) (32,358) (33,329) (34,329) (35,359) (36,419) (37,512) (38,637) (39,797) (40,990) (42,220) (43,487) (44,791) (46,135) (47,519) (48,945) (50,413) (51,925) (53,483) (55,088) (56,740)O&M - others 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Primary Fuel - Coal (232,058) (245,981) (260,740) (276,384) (292,967) (310,545) (329,178) (348,929) (369,864) (392,056) (415,580) (440,515) (466,945) (494,962) (524,660) (556,139) (589,508) (624,878) (662,371) (702,113) (744,240) (788,894) (836,228) (886,402) (939,586)Secondary Fuel 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Secondary Fuel 2 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Insurance (3,988) (4,187) (4,396) (4,616) (4,847) (5,089) (5,344) (5,611) (5,891) (6,186) (6,495) (6,820) (7,161) (7,519) (7,895) (8,290) (8,704) (9,139) (9,596) (10,076) (10,580) (11,109) (11,664) (12,248) (12,860)Consumables and Other Costs (1,418) (1,489) (1,563) (1,642) (1,724) (1,810) (1,900) (1,995) (2,095) (2,200) (2,310) (2,425) (2,547) (2,674) (2,808) (2,948) (3,095) (3,250) (3,413) (3,583) (3,762) (3,950) (4,148) (4,355) (4,573)

Total operating expenses (265,376) (280,407) (296,312) (313,143) (330,953) (349,803) (369,751) (390,864) (413,210) (436,862) (461,897) (488,397) (516,449) (546,145) (577,583) (610,864) (646,099) (683,403) (722,899) (764,717) (808,995) (855,879) (905,524) (958,093) (1,013,760)Cash Flow from Operations 154,199 160,142 166,260 172,554 179,024 185,669 192,489 199,484 206,650 213,986 221,488 229,152 236,971 244,941 253,052 261,296 269,663 278,141 286,715 295,371 304,090 312,853 321,638 330,420 339,170

Less Depreciation (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988) (40,988)Operating Profit (Loss) Before Interest and Tax 113,210 119,154 125,272 131,566 138,035 144,681 151,501 158,496 165,662 172,998 180,500 188,164 195,983 203,952 212,064 220,308 228,675 237,153 245,727 254,383 263,102 271,865 280,650 289,431 298,182

Less Interest Expense (61,974) (57,696) (53,076) (48,086) (42,697) (36,877) (30,591) (23,802) (16,470) (8,552) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Profit (Loss) Before Tax 51,236 61,458 72,196 83,480 95,338 107,804 120,910 134,694 149,192 164,446 180,500 188,164 195,983 203,952 212,064 220,308 228,675 237,153 245,727 254,383 263,102 271,865 280,650 289,431 298,182

Less Corporate Tax 0 0 0 0 0 0 0 (13,469) (14,919) (16,445) (18,050) (18,816) (19,598) (20,395) (21,206) (22,031) (22,868) (23,715) (24,573) (25,438) (26,310) (27,186) (28,065) (28,943) (29,818)Income After Tax 51,236 61,458 72,196 83,480 95,338 107,804 120,910 121,224 134,273 148,002 162,450 169,347 176,385 183,557 190,857 198,277 205,808 213,437 221,154 228,944 236,792 244,678 252,585 260,488 268,364

Add Depreciation 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 40,988 Net Operating Cash Flow 92,224 102,446 113,185 124,468 136,327 148,792 161,899 162,212 175,261 188,990 203,438 210,335 217,373 224,545 231,846 239,266 246,796 254,426 262,142 269,933 277,780 285,667 293,573 301,476 309,352

Capital Expenditure (1,024,705)Grant 0 Salvage Value

Net Cash Flow Before Debt Service (Principal) (1,024,705) 92,224 102,446 113,185 124,468 136,327 148,792 161,899 162,212 175,261 188,990 203,438 210,335 217,373 224,545 231,846 239,266 246,796 254,426 262,142 269,933 277,780 285,667 293,573 301,476 309,352 CUMMULATIVE CASH FLOW BEFORE DEBT SERVICE (1,024,705) (932,481) (830,035) (716,850) (592,382) (456,056) (307,264) (145,365) 16,848 192,108 381,098 584,537 794,872 1,012,245 1,236,791 1,468,636 1,707,902 1,954,698 2,209,123 2,471,266 2,741,198 3,018,978 3,304,645 3,598,218 3,899,694 4,209,046

Less Debt Repayments (53,476) (57,754) (62,374) (67,364) (72,753) (78,573) (84,859) (91,648) (98,980) (106,898) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Net Financing Cash Flow 38,749 44,692 50,811 57,104 63,574 70,219 77,040 70,565 76,281 82,092 203,438 210,335 217,373 224,545 231,846 239,266 246,796 254,426 262,142 269,933 277,780 285,667 293,573 301,476 309,352 INVESTMENT PERFORMANCECash Flow Before Debt Service (Interest + Principal) and Tax (1,024,705) 154,199 160,142 166,260 172,554 179,024 185,669 192,489 199,484 206,650 213,986 221,488 229,152 236,971 244,941 253,052 261,296 269,663 278,141 286,715 295,371 304,090 312,853 321,638 330,420 339,170

Nominal Pre-Tax Project IRR 18.12% Err:523 Err:523 -29.78% -15.62% -6.41% -0.19% 4.18% 7.34% 9.67% 11.44% 12.81% 13.87% 14.72% 15.39% 15.94% 16.38% 16.74% 17.04% 17.29% 17.50% 17.67% 17.81% 17.93% 18.04% 18.12%Net Present Value Pre-Tax (NPV)@ 8.00% 1,234,831

Net Cash Flow Before Debt Service (Interest + Principal) (1,024,705) 154,199 160,142 166,260 172,554 179,024 185,669 192,489 186,014 191,731 197,542 203,438 210,335 217,373 224,545 231,846 239,266 246,796 254,426 262,142 269,933 277,780 285,667 293,573 301,476 309,352 Nominal Post-Tax Project IRR 17.61%Net Present Value Post-Tax (NPV)@ 8.00% 1,122,802

Equity Cash Flow (307,412) 38,749 44,692 50,811 57,104 63,574 70,219 77,040 70,565 76,281 82,092 203,438 210,335 217,373 224,545 231,846 239,266 246,796 254,426 262,142 269,933 277,780 285,667 293,573 301,476 309,352 Nominal Equity IRR (Post-Tax) 24.08%

DEBT SERVICEOverall interest rate 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00%

Debt at beginning of year 0 0 774,677 721,202 663,448 601,074 533,710 460,957 382,384 297,525 205,878 106,898 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Debt Drawdown 0 717,294 Interest During Construction 0 57,384 Other Financing Expenses 0 0 Repayment of Principal (53,476) (57,754) (62,374) (67,364) (72,753) (78,573) (84,859) (91,648) (98,980) (106,898) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Debt at the end of the year 0 774,677 721,202 663,448 601,074 533,710 460,957 382,384 297,525 205,878 106,898 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest expense (61,974) (57,696) (53,076) (48,086) (42,697) (36,877) (30,591) (23,802) (16,470) (8,552) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Total Debt service 0 0 (115,450) (115,450) (115,450) (115,450) (115,450) (115,450) (115,450) (115,450) (115,450) (115,450) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEBT SERVICE COVERAGE RATIOSPre-Tax Cash Flow Coverage

of Interest 2.49 2.78 3.13 3.59 4.19 5.03 6.29 8.38 12.55 25.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 of Debt Service 1.34 1.39 1.44 1.49 1.55 1.61 1.67 1.73 1.79 1.85 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

After-Tax Cash Flow Coverageof Interest 2.49 2.78 3.13 3.59 4.19 5.03 6.29 7.82 11.64 23.10 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 of Debt Service 1.34 1.39 1.44 1.49 1.55 1.61 1.67 1.61 1.66 1.71 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

SIMPLE PAYBACKPAYBACK (year) 7.90 years 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 PAYBACK (month) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.90 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00