ANNOUNCEMENT CONNECTED TRANSACTIONS AND CONTINUING CONNECTED TRANSACTION CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT

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1 Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. (A joint stock limited company incorporated in the People s Republic of China with limited liability) (Stock Code: 0958) ANNOUNCEMENT CONNECTED TRANSACTIONS AND CONTINUING CONNECTED TRANSACTION CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT AND CARBON ASSET MANAGEMENT AND PURCHASE AGREEMENT CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT On 10 December, 2014, the Company, CRM and Huaneng Carbon Asset Management entered into the Carbon Asset Assignment and Entrusted Management Agreement, which came into effect on the same day. According to the Carbon Asset Assignment and Entrusted Management Agreement, CRM abandons its right to purchase carbon assets produced, and to be produced by the Projects, and transfers to Huaneng Carbon Asset Management its rights and obligations to purchase carbon assets under Certified Remission Reduction Purchase Agreements for free. As a party to Certified Emission Reductions Purchase Agreements, the Company agrees to such transfer. CARBON ASSET MANAGEMENT AND PURCHASE AGREEMENT On the same day, the Company and Huaneng Carbon Asset Management entered into the Carbon Asset Management and Purchase Agreement, which came into effect on the same day. According to the Carbon Asset Management and Purchase Agreement, (1) Huaneng Carbon Asset Management agrees to purchase all of the carbon assets produced by the Projects before 2012, for a consideration of RMB million; and (2) the Company agrees to engage Huaneng Carbon Asset Management to provide management service in relation to carbon assets produced by the Projects between 2012 and 2017 for three years ending on 31 December

2 As at the date of this announcement, Huaneng Group holds a 61.30% equity interest in the Company, including a 58.24% direct equity interest held by Huaneng Group and a 3.07% equity interest held through Huaneng Capital Services Corporation Ltd., a wholly-owned subsidiary of Huaneng Group. Huaneng Carbon Asset Management has five existing shareholders, all of which are units under Huaneng Group (with Huaneng Capital Services Corporation Ltd. holding 60%, the Company holding 10%, Huaneng Sichuan Hydropower Co., Ltd. holding 10%, Huaneng Lancang River Hydropower Co., Ltd. holding 10%, and Xi an Thermal Power Research Institute Co., Ltd. holding 10%). As such, Huaneng Carbon Asset Management is a connected person of the Company and the transaction as contemplated by the Carbon Asset Assignment and Entrusted Management Agreement constitutes a connected transaction of the Company under the Hong Kong Listing Rules, the Purchase Transaction as contemplated by the Carbon Asset Management and Purchase Agreement constitutes a connected transaction of the Company under the Hong Kong Listing Rules, and the Management Transaction as contemplated by the Carbon Asset Management and Purchase Agreement constitutes a continuing connected transaction of the Company under the Hong Kong Listing Rules. In respect of the Carbon Asset Assignment and Entrusted Management Agreement, as all of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) are less than 0.1%, the transaction as contemplated by the Carbon Asset Assignment and Entrusted Management Agreement is exempt from the reporting, announcement and independent shareholders approval requirements as set out in Chapter 14A of the Hong Kong Listing Rules. In respect of the Purchase Transaction as contemplated by the Carbon Asset Management and Purchase Agreement, as one or more of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) exceeds 0.1% but all are less than 5%, the Purchase Transaction is only subject to the reporting and announcement requirements set out in Chapter 14A of the Hong Kong Listing Rules but is exempt from independent shareholders approval requirement. In respect of the Management Transaction as contemplated by the Carbon Asset Management and Purchase Agreement, as all of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) are less than 0.1%, the Management Transaction is exempt from the reporting, announcement and independent shareholders approval requirements as set out in Chapter 14A of the Hong Kong Listing Rules. I. BACKGROUND Since 2008, the Company and CRM entered into Certified Emission Reductions Purchase Agreements in relation to the Projects. For reasons such as the credit crisis in Europe Union and substantial surpluses in carbon emission quota, excess carbon emission reductions and imbalance between demand and supply, there has been a serious reduction in prices in the international carbon market since 2012, leading to disputes between the Company and CRM on the performance of Certified Emission Reductions Purchase Agreements. In consideration of the - 2 -

3 uncertainties in the domestic and overseas carbon markets, after arm-length negotiation, considering that Huaneng Carbon Asset Management is the operation platform of the carbon asset business of Huaneng Group, and is a professional company in the areas of carbon asset management and possesses an edge in talents and technologies as well as extensive experience in project management, the Company and Huaneng Carbon Asset Management agree to cooperate in the Projects and enter into the following agreements. After arm-length negotiation, on 10 December, 2014, the Company, CRM and Huaneng Carbon Asset Management entered into the Carbon Asset Assignment and Entrusted Management Agreement, which came into effect on the same day. According to the Carbon Asset Assignment and Entrusted Management Agreement, CRM abandons its right to purchase carbon assets produced, and to be produced by the Projects, and transfers to Huaneng Carbon Asset Management its rights and obligations to purchase carbon assets under Certified Remission Reduction Purchase Agreements for free. As a party to Certified Emission Reductions Purchase Agreements, the Company agrees to such transfer. On the same day, after arm-length negotiation, the Company and Huaneng Carbon Asset Management entered into the Carbon Asset Management and Purchase Agreement, which came into effect on the same day. According to the Carbon Asset Management and Purchase Agreement, (1) Huaneng Carbon Asset Management agrees to purchase all of the carbon assets produced by the Projects before 2012, for a consideration of RMB million; and (2) the Company agrees to engage Huaneng Carbon Asset Management to provide management service in relation to carbon assets produced by the Projects between 2012 and 2017 for three years ending on 31 December II. CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT Date: 10 December 2014 Parties: The Company CRM Huaneng Asset Management Effective date: Execution date of the Carbon Asset Assignment and Entrusted Management Agreement - 3 -

4 Description of transaction: According to the Carbon Asset Assignment and Entrusted Engagement Management Agreement, CRM abandons its right to purchase carbon assets produced, and to be produced by the Projects, and transfers to Huaneng Carbon Asset Management its rights and obligations to purchase carbon assets under Certified Remission Reduction Purchase Agreements for free. As a party to Certified Emission Reductions Purchase Agreements, the Company agrees to such transfer. III. CARBON ASSET MANAGEMENT AND PURCHASE AGREEMENT Date: 10 December 2014 Parties: The Company Huaneng Carbon Asset Management Effective date: Execution date of the Carbon Asset Management and Purchase Agreement Description of transaction: According to the Carbon Asset Management and Purchase Agreement: (1) Purchase Transaction: considering that Huaneng Carbon Asset Management has received the rights and obligations to purchase carbon assets under Certified Emission Reductions Purchase Agreements, the Company agrees to sell all of the carbon assets produced by the Projects before 2012, for a consideration of RMB million, for which Huaneng Carbon Asset Management shall not pay at the point of such purchase. The consideration was arrived after arm-length negotiation and considering the amount payable from CRM to the Company, which has not been settled; (2) Management Transaction: considering that Huaneng Carbon Asset Management agrees to purchase all of the carbon assets produced by the Projects before 2012, the Company agrees to engage Huaneng Carbon Asset Management to provide management service in relation to carbon assets produced by the Projects between 2012 and 2017 for three years ending on 31 December Huaneng Carbon Asset Management will formulate development and management strategies of carbon assets according to the related domestic and overseas policies, price trends and analyses of demand and supply, and Huaneng Carbon Asset Management will sell carbon assets produced by the Projects between 2012 and 2017 in domestic and overseas carbon emission reduction markets. After arm-length negotiation taking into account market conditions and the risks associated with the revenue to be generated from selling of carbon assets, upon the successful completion of selling, RMB5 (to be adjusted by mutual agreements according to carbon market conditions) in the revenue corresponding to each metric tonne of carbon assets sold shall - 4 -

5 belong to the Company, while the remaining revenue shall belong to Huaneng Carbon Asset Management. The revenue belonging to Huaneng Carbon Asset Management generated from such transactions shall be used for the repayment its outstanding debt of RMB million to the Company, prior to any other uses. As at 31 December 2017, if Huaneng Carbon Asset Management is unable to pay off RMB million debt in full, the Company shall waive its entitlement to any unpaid debt, and has the right to retrieve carbon assets produced by the Projects. After arm-length negotiation taking into account the market conditions and scale of the Project, each year the Company shall pay management fee to Huaneng Carbon Asset Management, which amounts to 2% of outstanding debt owed by Huaneng Carbon Asset Management as at the last day of the preceding year. The Company shall pay management fee at the second quarter of each year. Therefore, the Company will pay not more than RMB4.00 million as management fee to Huaneng Carbon Asset Management in 2015, and such number will be reduced yearly in 2016 and Therefore, all of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) are less than 0.1%. IV. REASONS FOR AND BENEFITS OF ENTERING INTO THE CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT AND THE CARBON ASSET MANAGEMENT AND PURCHASE AGREEMENT As the operation platform of the carbon asset business of Huaneng Group, Huaneng Carbon Asset Management is a professional company in the areas of carbon asset management. Huaneng Carbon Asset Management possesses an edge in talents and technologies as well as extensive experience in project management. The business objective of Huaneng Carbon Asset Management is to reach out to the market with backing from Huaneng Group, and provides customers with a basket of comprehensive services including development of energy saving and emission reduction projects, carbon asset management, consultancy, education and training through professional, large-scale and international operations. Huaneng Carbon Asset Management possesses professional teams in areas including clean development mechanism (CDM), energy management contract (EMC), low-carbon industry investment fund management and carbon finance services. Huaneng Carbon Assets Management also possesses advanced business philosophy, strong technological capabilities and enjoys a high reputation in the industry. For reasons such as the credit crisis in Europe Union and substantial surpluses in carbon emission quota, and excess reductions in carbon emission, there has been a serious reduction in prices in the international carbon market since CRM has been unable to perform its obligations under Certified Emission Reductions Purchase Agreements. In consideration of above situations, and uncertainties in the domestic and overseas carbon markets, the cooperation between the Company and Huaneng Carbon Asset Management and the execution of the Carbon Asset Assignment and Entrusted Management Agreement and the Carbon Asset Management and Purchase Agreement are in the interests of the Company and its shareholders as a whole

6 V. HONG KONG LISTING RULES IMPLICATIONS IN RELATION TO THE CARBON ASSET ASSIGNMENT AND ENTRUSTED MANAGEMENT AGREEMENT AND THE CARBON ASSET MANAGEMENT AND PURCHASE AGREEMENT As at the date of this announcement, Huaneng Group holds a 61.30% equity interest in the Company, including a 58.24% direct equity interest held by Huaneng Group and a 3.07% equity interest held through Huaneng Capital Services Corporation Ltd., a wholly-owned subsidiary of Huaneng Group. Huaneng Carbon Asset Management has five existing shareholders, all of which are units under Huaneng Group (with Huaneng Capital Services Corporation Ltd. holding 60%, the Company holding 10%, Huaneng Sichuan Hydropower Co., Ltd. holding 10%, Huaneng Lancang River Hydropower Co., Ltd. holding 10%, and Xi an Thermal Power Research Institute Co., Ltd. holding 10%). As such, Huaneng Carbon Asset Management is a connected person of the Company and the transaction as contemplated by the Carbon Asset Assignment and Entrusted Management Agreement constitutes a connected transaction of the Company under the Hong Kong Listing Rules, the Purchase Transaction as contemplated by the Carbon Asset Management and Purchase Agreement constitutes a connected transaction of the Company under the Hong Kong Listing Rules, and the Management Transaction as contemplated by the Carbon Asset Management and Purchase Agreement constitutes a continuing connected transaction of the Company under the Hong Kong Listing Rules. In respect of the Carbon Asset Assignment and Entrusted Management Agreement, as all of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) are less than 0.1%, the transaction as contemplated by the Carbon Asset Assignment and Entrusted Management Agreement is exempt from the reporting, announcement and independent shareholders approval requirements as set out in Chapter 14A of the Hong Kong Listing Rules. In respect of the Purchase Transaction as contemplated by the Carbon Asset Management and Purchase Agreement, as one or more of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) exceeds 0.1% but all are less than 5%, the Purchase Transaction is only subject to the reporting and announcement requirements set out in Chapter 14A of the Hong Kong Listing Rules but is exempt from independent shareholders approval requirement. In respect of the Management Transaction as contemplated by the Carbon Asset Management and Purchase Agreement, as all of the applicable percentage ratios (as defined under Rule of the Hong Kong Listing Rules) are less than 0.1%, the Management Transaction is exempt from the reporting, announcement and independent shareholders approval requirements as set out in Chapter 14A of the Hong Kong Listing Rules. The Board has considered and approved the resolutions in connection with the Carbon Asset Assignment and Entrusted Management Agreement and the Carbon Asset Management and Purchase Agreement. Mr. CAO Peixi, Director of the Company, is the President of Huaneng Group. Mr. ZHANG Tingke, Director of the Company, is the Vice President of Huaneng Group. Mr. WANG Kui, Director of the Company, is the chief of the Planning and Development - 6 -

7 Department of Huaneng Group. Therefore, Mr. CAO Peixi, Mr. ZHANG Tingke and Mr. WANG Kui are deemed to have an interest in the Carbon Asset Assignment and Entrusted Management Agreement and the Carbon Asset Management and Purchase Agreement, and have abstained from voting on the resolutions in respect of the Carbon Asset Assignment and Entrusted Management Agreement and the Carbon Asset Management and Purchase Agreement pursuant to Rule 14A.56(9) of the Hong Kong Listing Rules. The Board (including the independent non-executive Directors) is of the view that the Carbon Asset Assignment and Entrusted Management Agreement and the Carbon Asset Management and Purchase Agreement were entered into on normal commercial terms, and the terms and conditions therein are fair and reasonable and in the interests of the Company and its shareholders as a whole. VI. GENERAL INFORMATION OF THE PARTIES The Company is committed to the investment, construction and operation of renewable energy projects, with a focus on the development and operation of wind power together with the development of solar energy and other renewable energy. Huaneng Group mainly engages in the development, investment, construction, operation and management of power sources, the production and sale of power (heat), the development, investment, construction, production and sale of businesses and products relating to energy, transportation, renewable energy and environmental protection. Huaneng Group holds a 61.30% equity interest in the Company, including a 58.24% direct equity interest held by Huaneng Group and a 3.07% equity interest held through Huaneng Capital Services Corporation Ltd., a wholly-owned subsidiary of Huaneng Group (Note). Huaneng Carbon Asset Management is mainly engaged in the development, operation and management of carbon assets, and develops entrusted carbon asset projects such as CDM projects, provides agency trading for energy saving and emission reduction indicators, plans and implements carbon finance service plans, and launches information consultancy services on saving energy and emission reduction policies. CRM is a keen participant in the industry of carbin emission reduction. It has profound experience in exploration of carbon asset projects, and has successfully registered more than 200 CDM projects in China. CRM is a third party independent of the Company and connected persons of the Company

8 DEFINITIONS Board carbon assets Carbon Asset Assignment and Entrusted Management Agreement Carbon Asset Management and Purchase Agreement CDM Projects CRM Company connected person connected transaction Directors Hong Kong Listing Rules Huaneng Carbon Asset Management means the Board of Directors of the Company; means emission reduction produced or can be produced by greenhouse gas emission reduction projects under CDM, domestic voluntary emission reduction or other mechanisms; means the Carbon Asset Assignment and Entrusted Management Agreement which the Company, CRM and Huaneng Carbon Asset Management entered into on 10 December, 2014; means the Carbon Asset Management and Purchase Agreement which the Company and Huaneng Carbon Asset Management entered into on 10 December, 2014; means Clean Development Mechanism under The Kyoto Protocol; means a total of 99 carbon emission reduction projects of the Company in cooperation with CRM since 2008; means Carbon Resource Management S.A., a company registered in the Switzerland; means Huaneng Renewables Corporation Limited ( 華能新能源股份有限公司 ), a joint stock limited company incorporated in the PRC with limited liability, the H shares of which are listed on the Stock Exchange; has the meaning ascribed to it under the Hong Kong Listing Rules; has the meaning ascribed to it under the Hong Kong Listing Rules; means Directors of the Company; The Rules Governing the Listing of Securities on the Stock Exchange; means Huaneng Carbon Asset Management Co., Ltd. ( 華能碳資產經 有限公司 ), a company established in July 2010 in the PRC and a connected person of the Company; - 8 -

9 Huaneng Group Management Transaction PRC or China RMB Stock Exchange subsidiaries. Purchase Transaction means China Huaneng Group ( 中國華能集團公司 ), a state-owned enterprise established in the PRC and the controlling shareholder of the Company; the purchase transaction as contemplated by the Carbon Asset Management and Purchase Agreement in relation to carbon assets produced by the Projects between 2012 and 2017; means the People s Republic of China, except Hong Kong, Macau and Taiwan for the purpose of this announcement; means Renminbi, the lawful currency of the PRC; means The Stock Exchange of Hong Kong Limited; has the meaning ascribed to it under the Hong Kong Listing Rules; and the purchase transaction as contemplated by the Carbon Asset Management and Purchase Agreement in relation to all of the carbon assets produced by the Projects before By order of the Board Huaneng Renewables Corporation Limited SONG Yuhong Company Secretary Beijing, the PRC, 10 December, 2014 As atthe date of thisannouncement, the Company s non-executive:directorsare Mr.CAO Peixi,Mr. ZHANG Tingke and Mr. WANG Kui; executive Directors are Mr. LIN Gang, Mr. XIAO Jun, Ms. YANG Qing and Mr. HE Yan; and independent non-executive Directors are Mr. QIN Haiyan, Ms. DAI Huizhu, Mr. ZHOU Shaopeng and Mr. WAN Kam To. * For identification purpose only Note: Numbers may not add up due to rounding - 9 -