GASIFICATION TECHNOLOGY CONFERENCE

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GASIFICATION TECHNOLOGY CONFERENCE San Francisco (USA) October,, 2007 1/25

IGCC PLANT - Falconara M.ma PERFORMANCE UPDATE AND FUTURE ENHANCEMENTS 2/25 PAOLO CICCARELLI STEFANO BERTOLINI MAURO BEDETTI Director of Operations Process Superintendent Environmental Superintendent & Tech. T Develop. Specialist

AUXILIARY SYSTEMS TO GASIFICATION 4 3 IGCC PLANT LAYOUT 1 6 GASIFICATION AREA 2 7 (1) GASIFICATION AREA (2) ABSORPTION AREA (3) SULPHUR RECOVERY AREA (4) GREY WATER TREATMENT AREA (5) AIR SEPARATION UNIT AREA (6) BOILER AREA (7) STEAM TURBINE AREA (8) GAS TURBINE AREA (9) ANNEX BUILDING AREA (10) SEA WATER PUMPHOUSE AREA (11) SEA WATER INTAKE AREA 132 KV SUBSTATION 3/25 10 5 8 9 OUTFALL 11 SEA WATER INTAKE COMBINED CYCLE POWER PLANT AREA

MILESTONES OF THE PROJECT Jan, 1997 Apr, 2001 CONSTRUCTION START-UP ( Project Financing ~600.000.000 ) ACCEPTANCE TEST (PAC) 2001 2003 INTERRUPTED OPERATION ( Availability Factor < 70% ) 4/25 2002-2004 RELIABILITY IMPROVEMENT PROJECT ( Upgrading Investment = 50.000.000 ) 2004-2007 2007 RELIABLE OPERATION ( Availability Factor > 90% )

MAIN UPGRADINGS RELIABILITY IMPROVEMENT PROJECT CONCERNED THE FOLLOWING ASPECTS: AUTOMATIC CONTROL AND EMERGENCY LOGICS OPTIMIZATION; (Gasifiers load control, ASU Supervision, GT emergency change-over, Master Controller) UPGRADING OF EQUIPMENT AND PIPING METALLURGY; (Carbon Extraction: Superduplex / Oxygen System: Monel / Grey Water: Hastelloy) 5/25 SUBSTITUTION/UPGRADING OF SOME EQUIPMENT (UNDERSIZED, NON SUITABLE MATERIALS, UNRELIABLE) (Air Intake Filters, Main Air Compressor, Water Flash Separator) IMPROVEMENT OF PLANT INSTRUMENTATION AND REDUNDANCY OVERALL TECHNOLOGICAL IMPROVEMENTS (New DeNOx System, Gas Turbine XL Technology, Gasifiers.)

GAS TURBINE PICTURES NEW GT BLADES XL VERSION 6/25 NEW GT AIR INTAKE FILTER

MAIN AIR COMPRESSOR PICTURES NEW AIR COMPRESSOR ROTOR (5 STAGES) 7/25 NEW AIR COMPRESSOR MOTOR (24MW)

RUNNING HOURS and AVAILABILITY OPERATING HOURS [h] 100% 80% 60% 40% 20% 0% IGCC - Operating Hours [%] 2001 2002 2003 2004 2005 2006 2007 YEARS GPO [GWh] 2001 1387 2002 1475 2003 1462 2004 2252 2005 2168 2006 2141 2007 2200 *Expected GPO [GWh] 2500 2250 2000 1750 1500 1250 1000 750 500 250 0 OH [h] 2001 64.2% 2002 68.8% 2003 62.4% 2004 95.3% 2005 90.4% 2006 89.7% 2007 91.0% *Q3-2007 IGCC - Gross Power Output [MWh] 2001 2002 2003 2004 2005 2006 2007 YEARS 8/25

ANNUAL OPERATING PLANT RESULTS SYNGAS OPERATION [h] DIESEL OPERATION SCHEDULED S/D UNSCHEDULED S/D NUMBER of INSPECTIONS [h] [h] [h] 2004 7943 403 252 187 1 (A) 2005 7674 243 504 338 2 (B - A) 2006 7737 118.7 870 34 1 (C) Q3-2007 5901 64 523 64 2 (A + B) 9/25 AVAILABILITY at SYNGAS 90.4% 87.6% 88.3% 90.1% TOTAL AVAILABILITY 95.0% 90.4% 89.7% 91.0% CONTINUOUS REDUCTION OF DIESEL OIL OPERATION DECREASE IN UNSCHEDULED SHUT-DOWN HOURS PRESERVING EXCELLENT PLANT AVAILABILITY

FUTURE ENHANCEMENTS REDUCTION OF NOx EMISSION HYDROGEN PRODUCTION FROM SYNGAS 10/25 CO2 CAPTURE STUDIES BIOFUEL CO-GASIFICATION

BIOFUEL COGASIFICATION SCOPE OF THE PROJECT Supply Biofuels to Gasification mixed with heavy residues GOALS Respond to increasing requests to improve environmental protection. Increase the environmental friendly value of the IGCC Technology. Access to Green Certificate System 11/25 TARGET To produce 20-30 MW of green energy by feeding ~5 ton/h of biofuel into Gasifiers (7-10% of the overall power production)

STEPS OF THE PROJECT COMPLETE FAMILIARIZATION WITH AUTHORITY REGULATIONS IDENTIFICATION OF THE MOST SUITABLE BIO-FUELS (compatible both with technology and legislation ) ECONOMICAL EVALUATION FEASIBILITY TESTS GENERAL BIO FUEL SUPPLY CONTRACTS IN PROGRESS 12/25 DETAILED ENGINEERING OF PLANT MODIFICATIONS FINALIZATION OF LEGISLATIVE PERMISSIONS (approval of plant modifications and authorization of incentive rates) PLANT MODIFICATION CO-GASIFICATION START UP

STRENGTHS &WEAKNESSES COGASIFICATION STRENGTHS ENVIRONMENTALLY COMPATIBLE TECHNOLOGY MILD REDUCTION OF CO2 EMISSION EASY TO BE IMPLEMENTED (just minor plant modifications needed) ECONOMICAL VALUE OF GREEN CERTIFICATES INCREASE PLANT PROFITABILITY 13/25 COGASIFICATION WEAKNESSES HIGH COSTS OF CONVENTIONAL BIOFUELS (in continuous increase); LACK OF A CLEAR AUTHORITY REGULATION UNCLEAR LIST OF ACCEPTED BIOFUELS (Glycerin?) RAW BIO-PRODUCTS NOT EASILY AVAILABLE (for about 50000 t/y)

INTEGRATION WITH EXISTING PLANT 14/25

GASIFICATION TECHNOLOGY CONFERENCE San Francisco October 14th-17th, 17th, 2007 15/25 www.apienergia.com