PENNY WATCH

[Grozny]

ROUGH LLEG VALUATION: Estimated revenues of $77,710,288 USD per annum (20 year contract = $1,554,205,760 over the life of the contract)

NH Site Evaluation Committee voted 9-0 IN FAVOR OF LAIDLAW!

Renewable Energy Certificates will bring huge additional revenues to LLEG's Berlin project:

http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=NH09R&re=1&ee=1

http://www.epa.gov/grnpower/documents/gpp_basics-recs.pdf

According to the State of New Hampshire's Renewable Portfolio Standard, Laidlaw's Berlin project will produce (65MW)*(365 days/year)*(24 hours/day) = 569,400 MWh of electricity per year. 1 MWh = 1 Renewable Energy Certificate.



-->Therefore, by NH's standard, Laidlaw's Berlin Project can sell 569,400 Renewable Energy Certificates per year @ $60.92 per Certificate. Laidlaw will generate $34,687,848 USD per year in revenue just from RECs alone.

-->The 65MWh of power will also be sold per a Power Purchase Agreement. PSNH (NH's utility provider) sells power at $.151115 per kWh. Assuming that PSNH buys Laidlaw's power at half what they charge consumers ($.0755575 per kWh), Laidlaw will generate $43,022, 441 USD per year in revenue from sale of electric power.

-->That brings Laidlaw's total estimated revenue to $77,710,288 USD per year. The power purchase term sheet lists the proposed Power Purchase Agreement as a 20 year contract (http://www.biomassmagazine.com/article.jsp?article_id=2088 & www.psnhnews.com). This contract (under current REC and electric rates) would supply Laidlaw with $1,554,205,760 USD in revenue for the 20 year life of the contract.

-->LLEG owns 37.5% of the Berlin project, giving them a total of $582,827,160 of revenue over the life of the contract.

-->Laidlaw's estimated profits from Laidlaw Berlin Biopower:
costs 50% of revenue: profit of $291,413,580 over the 20 year contract
costs 60% of revenue: profit of $233,130,864 over the 20 year contract
costs 70% of revenue: profit of $174,848,148 over the 20 year contract

--> It has been discussed that LLEG sold their equity position in Laidlaw Berlin for cash. This could make for a nice balance sheet at the end of the year and allow LLEG to grow!

Do your own DD on this one! Here are a few state of NH links to get you started:

http://www.puc.nh.gov/Regulatory/Docketbk/2010/10-195.htm
http://www.nhsec.nh.gov/2009-02/index.htm