S.A.G. Solarstrom AG

Dr Karl Kuhlmann

CEO

June 8, 2010

Munich

1. Facts and Data of the S.A.G. Solarstrom Group

2. The Photovoltaics Market in Germany

3. The Costs of Photovoltaics for the German Economy

4. The Future of the Photovoltaics Market in Germany

5. Future Strategy of the S.A.G. Solarstrom Group

Agenda

2

Ground-mounted system Location: Brindisi, Apulia, Italy

Performance: 9.7 MWp Year of grid connection: 2010 3

1. Facts and Data of the S.A.G. Solarstrom Group

© S.A.G.

Experience and strength

Unique value chain

Key figures

S.A.G. Solarstrom AG: industry pioneers and international specialists in PV

Founded in: 1998, around 160 employees, ten locations in Germany and Europe

Cover the entire value-added chain and are thus uniquely positioned

Extensive experience:

Based on more than 2,700 installed systems and 70 own PV systems with a total output of

11.8 MWp

meteocontrol GmbH:

Worldwide monitoring of around 12,500 PV systems in total over 1.4 GWp

Experience in projects with an investment of over €5 billion

1.1 Covering the entire value chain: A major advantage for S.A.G. customers

4

The S.A.G. Group is uniquely positioned in photovoltaics

€190 - €210 million

5

* 2006 corrected in line with IFRS

Growth has been sustainably profitable since 2007

Sales (in million €) EBIT (in million €)

15

20

25

100

200

250

150

50

0

1.2 Group key figures: Sales and EBIT

€8 - €11 million

2005 2006* 2010e20092007 2008

Sales

EBIT

10

5

0

BBV started

as main

shareholder

with approx.

10 % share

6

© S.A.G.

Rooftop system Location: Rain am Lech, Germany

Performance: 4.6 MWp Year of grid connection: 2009

2. The Photovoltaics Market in Germany

The Renewable Energy Act as support for photovoltaics

Power production from renewables increased considerably

Feed-in tariff boosted photovoltaic business in Germany

Germany most important photovoltaic market

7

The EEG is supporting renewable energies efficiently

2.1 The Renewable Energy Act and its goals

Full name: Act on Granting Priority to Renewable Energy Sources (EEG)

Goals according to §1 of the EEG:

To facilitate a sustainable development of energy supply

To reduce the economic costs (in particular) by incorporating external factors

(climate change, etc.)

To further develop and promote technologies for renewable energies

To distribute the costs fairly to all market participants by means of allocation

The legal foundation of the Act and the allocation are legally protected by the European

Court of Justice

The EEG has been “exported” to 47 countries to date

(such as China, France, Spain, Portugal, Brazil and the Czech Republic)

8

The EEG is a success story that started 20 years ago

2.2 Development of renewable energies in Germany up to 2009

1991:

Introduction of forerunner

to EEG

2000:

Introduction of

the EEG

2004:

1st amendment

of EEG

Sources: Agency for Renewable Energies, March 2010 and German Federal Association for Energy and Water, February 2010

2009:

2nd amendment

of EEG

0

20

40

60

80

100

120

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Power production (in TWh)

Photovoltaics

6.6 %

Hydraulic power

20.3 %

Biomass

32.7 %

Wind energy

40.4 %

Gross power generation in 2009: 597 TWh

Portion provided by renewable energies: 15 %

2.3 Development of feed-in tariff from 2002 to 2010

9

Installed PV capacity grew exponentially despite decreasing FIT

Sources: EEG and German Telecommunications Network Agency

0,00

10,00

20,00

30,00

40,00

50,00

60,00

2002 2003 2004 2005 2006 2007 2008 2009 2010

Ground-

mounted

PV-systems:

Rooftops

Feed-in tariff (in €Cent/kWh)

MWp installed: 290 432 1,053 1,961 2,773 4,017 5,950 9,800 14,300e

1.7.2010

60

40

30

20

10

0

50

Veto of Federal

Assembly on

04/06/2010

Final decision in

07/2010

?

?

2.4 Feed-in tariff for the different PV systems in €cent/kWh

10

Germany will see a massive cut in July 2010

2009 January 1, 2010 July 1, 2010

Rooftop systems

up to 30 kWp

own consumption (up to 29.9 kWp)

43.01

25.01

39.14

22.76

32.88

16.48/20.88*

from 30 kWp

own consumption (30 – 99.9 kWp)

40.91

-

37.23

-

31.27

14.87/19.27*

from 100 kWp

own consumption (100 – 500 kWp)

39.58

-

35.23

-

29.59

13.19/17.59*

from 1,000 kWp 33.00 29.37 24.67

Ground-mounted systems

Arable land 31.94 28.43 -

Conversion land 31.94 28.43 25.3

Other land 31.94 28.43 24.17

Source: EEG*Up to 30 % own consumption or more than 30 % own consumption

?Veto of Federal Assembly on June 4th, 2010

2.5 Size distribution of installed photovoltaic systems in Germany in 2009

11

The German photovoltaics market is a rooftop installation market

Number of installations

Performance category (in kWp)

Sources: German Telecommunications Network Agency

0

20.000

40.000

60.000

80.000

100.000

120.000

140.000

0…30 30...100 100…500 500…1000 >1.000

1.666 MWp

869 MWp

445 MWp 192 MWp 637 MWp

New installations in 2009:

3,809 MWp

140,000

120,000

100,000

80,000

60,000

40,000

20,000

>1,000

0

2.6 Global photovoltaic power installed by end of 2009

12

Germany is the largest photovoltaics market worldwide to date

Power (in GWp)

Source: EPIA, Global Market Outlook for photovoltaics until 2014

9.8

3.4

1.2 0.30.5 0.6 15.8

1.7

3.1 20.6

0

5.000

10.000

15.000

20.000

25.000

Germany Spain Italy France Czech Republic

Rest of EU

EU Total USA Rest of world

Total

25

20

15

10

5

0

Source. EPIA, Global market outlook for photovoltaics up to 2014

13

© S.A.G.

Ground-mounted system Location: Stribro, Pilsen, Czech Republic

Performance: 13.6 MWp Year of grid connection: 2009

3. The Costs of Photovoltaics for the German Economy

Electricity tariffs for private consumers continue to rise

FIT allocation less than 5 % of electricity tariff

Decreasing FIT keeps cost for EEG within limits

Economic costs of photovoltaics are low

Photovoltaics are foreseeable an alternative

Source: BDEW (German Federal Association for Energy and Water)

Price (in €cent/kWh)

14

3.1 The electricity tariff trend in Germany (private consumers)

The electricity tariff for private consumers will continue to rise

12

14

16

18

20

22

24

26

28

30

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013e ee e

15

5 %

3 %3 %

1 %

29 %

26 %

16 %

9 %

8 %

Förderung EE durch das EEG¹

Messung

Vertrieb

KWK-Umlage²

Erzeugung

Netzentgelt

Mehrwertsteuer

Stromsteuer

Konzessionsabgabe³

3.2 Composition of electricity tariff (private consumers) in Germany 2009

The support for renewable energies has a share of less than 5 % of the electricity tariff

Source: Agency for Renewable Energies, 2009

¹ Renewable Energy Act

² Act on Combined Heat and Power Generation

³ Fee that a public utility company has to pay to a local authority for the use of the lines and cables located in

public places

Measurement

Sales

Sales tax

Support of renewable energies

by EEG1

KWK allocation 2

Generation

Network charges

Electricity tax

License fee3

3.3 Feed-in tariff paid for solar electricity from 2002 to 2009

16

Total economic cost of the PV success story less than 7 billion € up to 2009

Sources: EEG and own calculations

Support for solar electricity

(in billion €)

0.01 0.05 0.15

0.44

0.81

1.18

1.67

2.48 6.79

0

1

2

3

4

5

6

7

8

2002 2003 2004 2005 2006 2007 2008 2009 Total

0

5

10

15

20

25

30

35

40

45

50

Solar electricity Conventional electricityprivate households

European Energy Exchange trade prices

3.4 Economic costs of power production have to be taken into account

17

Today, photovoltaic electricity is less expensive than coal and nuclear power

Total electricity costs in 2009

(in €cent/kWh)

Sources: German Federal Association for Energy and Water, German Federal

Environmental Agency and Greenpeace as well as own calculations

Economic costs

Economic costs for coal

and nuclear power:

0.20 €/kWh & around

100 billion EUR per year

0

1

2

3

4

5

6

7

0,10 0,15 0,20 0,25 0,30 0,35 0,40 0,45

18

Grid parity in Germany can be achieved at system prices between 3,200 and 2,500 EUR

Source: S.A.G. Solarstrom AG

850 kWh/kWp

Electricity tariff for private consumers (in €/kWh)

Specific yield: 1,100 kWh/kWp

3.5 Grid-parity is determined by radiation intensity and manufacturing costs

Manufacturing costs/kWp (in thousand €)

0,23 € / kWh

0.10 0.15 0.20 0.25 0.30 0.35 0.40 0.45

19

4. The Future of the Photovoltaics Market in Germany

© S.A.G.

Renewable energy’s share continues to increase

Germany can remain the most significant PV market

System prices need to decline in order to adapt to the market

Cost for FIT payments will decrease

Rooftop system Location: Rain am Lech, Germany

Performance: 4.6 MWp Year of grid connection: 2009

4.1 Share of renewable energies in energy generation up to 2020

20

In 2020, renewable energies will provide around 50 % of the total power consumption

Source: Agency for Renewable Energies, March 2010

14.4 %

16.2 %

53.9 %

8.9 %

6.6 %

Photovoltaics

Biomass

Wind energy

Hydraulic power

Geothermal energy

Gross power

production renewable

energies:

278 TWh

4.2 Forecast photovoltaic power installed by 2013

21

According to estimates, Germany will remain the strongest PV market worldwide

Power (in GWp)

Sources: own assumptions, EPIA, Photon Consulting, LBBW and EuPD

23.3

5.9

7.84.9

2.5 5.4 49.8

14.6

19.9 84.3

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

2009: 9.8 GWp

20

40

60

80

90

70

50

30

10

0

0%

20%

40%

60%

80%

100%

2009 2010e 2011e 2012e 2013e

4.3 Ratio of ground-mounted systems to rooftop systems in Germany

22

Source: own calculations

Ground-mounted systems

Rooftop systems

Installed capacity

(in %)

S.A.G. foresee a market-share of ground-mounted systems of less than 3 %

23

4.4 System prices have to decrease in line with FIT tariffs

Still a long way from reaching system prices which enable profitability

Source: own calculations

50%

60%

70%

80%

90%

100%

2009 2010e 2011e 2012e

Manufacturing costs (in %)

crystalline modules

thin-film modules

Precondition:

Reasonable

profitability for

investors and

system integrators

2012e:

Modules < 1,000 € / kWp

< 800 € / kWp

Inverters < 160 € / kWp

< 160 € / kWp

4.5 Forecast feed-in tariff paid for solar electricity (2010 to 2020)

24

Sources: EEG, Federal Government and own calculations

Support for solar electricity (in billion €)

Decreasing FIT will flatten cost growth curve for new installations

0

10

20

30

40

50

60

70

2009 2010e 2011e 2012e 2013e 2014e 2015e 2016e 2017e 2018e 2019e 2020e

Economic costs of conventional energy production:

around 100 billion € per year

Promotion for PV:

57 billion € within 20 years

25

Politicians should reconsider planned reduction, suppliers should adapt pricing policy

4.6 Conclusions

IRRs of rooftop systems will be reduced significantly unless system costs will decline

massively and/or changes to EEG are only moderate

Ground-mounted systems on arable land in Germany are becoming economically

unattractive. IRRs for systems on other land will be considerably reduced

Only limited capacities for conversion land, “other” land (e.g. parallel to the German Autobahn

or railway tracks)

Germany can remain one of the leading photovoltaic markets depending on system cost +

FIT development

Grid-parity can be achieved in the coming 5 years, depending on system cost development

and the cost of private consumer electricity tariff

In our opinion, ground-mounted systems will decline to less than 3% of the market (installed

capacity

26

5. Future Strategy of the S.A.G. Solarstrom Group

The S.A.G. Solarstrom Group is very well equipped for a changing market environment

International footprint to allocate individual market risks

Unique value chain offers opportunities in mature markets such as Germany:

Full service value chain over the complete lifetime of PV systems guarantees a high

profitability

Germany is a rooftop market – one of S.A.G.‟s strengths in project planning and development

Strong exclusive sales partner system enables easier market access and market coverage

Contact

Public Relations / Investor Relations

S.A.G. Solarstrom AG

Sasbacher Straße 5

79111 Freiburg i. Br.

Germany

Telephone: +49 761 4770 - 311

Fax: +49 761 4770 - 44 142

pr@solarstromag.com / ir@solarstromag.com

27

This presentation contains statements concerning future developments (or “forward-looking statements“). They are based on current expectations and

forecasts of future events as made by the management body of S.A.G. Solarstrom AG, as well as on certain assumptions – many of which are beyond

the influence of said management body. These statements thus involve a number of risks and uncertainties that could cause the company„s actual results

to deviate significantly from those the statements indicate. The assumptions that could lead to such deviations due to unforeseeable developments

include, but are not limited to: demand for our products and services; the competitive environment; the development, propagation, and technical

performance of photovoltaic technology, as well as the price thereof; changes in legislation, price, and the timely availability of the products and advance

financing required; our ability to expand existing sales and marketing agreements and conclude new such agreements; our ability to secure further

financing; and the availability of sufficiently qualified technical personnel.

© S.A.G. Solarstrom AG. This presentation and the graphics it contains are – when no source is cited – protected by copyright. Any unauthorized

reproduction, whether electronically or by some other means, is forbidden. Both commercial and non-commercial use is subject to the prior written

consent of S.A.G. Solarstrom AG. All rights reserved.