First Solar, Inc. Kingbird Solar Project Power Purchase Agreement City Council – Agenda Item 13 September 9, 2013

Project & Contract Overview 20 MW (AC) single-axis tracking solar PV To be located on 324 acres in Rosamond, CA Site includes Kingbird B (another 20 MW project – output purchased by SCPPA) Guaranteed commercial operation by January 2016 (Fiscal Year 2016) Add approx. 5.5% RPS PWP to pay for all energy “as available” ~60,000 MWh/year (1st year) Expected output degradation ~0.5% per year Price = $68.50/MWh through term of contract Includes Resource Adequacy capacity Option to Purchase 20 year term with option to extend by 5 years

Project Benefits RPS Category 1 resource relatively close to Pasadena Feasible to operate and maintain if purchased

Project Benefits Portfolio Fit Project size is a good match for PWP requirements 20 MW x 33% Capacity Factor PV production is variable, but generally aligns well with PWP demand

Project Benefits Viability Several initial milestones already achieved Site control, interconnection studies, CEC pre-certification, CEQA; Experienced project developer (First Solar, Inc.) with several utility scale projects already operating/under construction Solar PV is a proven technology

Project Benefits Value Renewable energy, environmental attributes and system resource adequacy. Facility purchase option at the 10th, 14th, or 18th contract year, or in the event of a default under the power purchase agreement. Price is competitive with other offers for similar renewable products.

Risks Some risks Include: Project development/construction failure or delay Counterparty credit/default Resource underperformance Comparative price risk Future or alternative resources may have lower prices Contractual provisions attempt to mitigate many risks, e.g.: Performance security Liquidated damages Guaranteed energy production Although there is risk that future resources may have lower prices, this contract is also a hedge against future price increases and volatility

Price Comparison Renewable Energy Contracts Price Comparison Resource Name/Type Contract Execution Contract Energy Price1 by Calendar Year ($/MWh) 2014 2015 2016 2017 2020 2025 Proposed Kingbird Solar 2013 - $68.50 Silverado Solar (+ $5.10/MWh for RA, if available) 2012 $77.34* $78.50* $79.68* $83.32* $89.76* WM Biomethane 2011 $94.92 Sequent Biomethane EDF Biomethane $98.00 Milford Wind 2009 $70.94 $72.19 $73.45 $74.74 $78.73 $85.86 Ormat Geothermal Phase 2 2008 $82.01 $83.24 $84.49 $85.76 $89.67 $96.60 Chiquita Canyon LFG 2006 $65.25 Ormat Geothermal Phase 1 2005 $64.77 $65.74 $66.73 $67.73 $70.83 $76.30 Iberdrola Renewables 2003 $53.50 2013 Market Forecast (Brown Power) $43.99* $46,.19* $48.50* $50.92* $58.95* $75.23* [1] Contract prices exclude costs of transmission, losses, and integration fees [price with * does not include RA capacity; all others do]

Renewable Portfolio Current Renewable Energy Portfolio Summary (GWh) Calendar Year 2015 2016 2020 2025 Azusa Hydro 5 Iberdrola High Winds 14 - Minnesota Methane LFG 42 Ormat Geothermal 16 Milford Wind Phase 1 11 Chiquita Canyon LFG 37 EDF Biomethane 13 Sequent Biomethane 29 30 38 Waste Management Biomethane 41 Silverado Solar 32 Proposed Kingbird Solar 60 58 57 Total Renewable Supply 240 301 266 158 Retail Sales 1161 1168 1196 %Renewable 21.3% 25.8% 22.2% 13.2% [1] A gigawatt-hour (“GWh”) is equal o 1,000 megawatt-hours (“MWh”)

Impact for a Typical Customer Using 500 KWh/Month CURRENT (without Kingbird) FUTURE (2016 onward with Kingbird)* Total $87.20 Total $87.72 Note: Current total bill includes all existing renewable contracts *Assumes other charges in the electric bill remain the same as current bill

Fiscal Impact - Cumulative Before Kingbird: After Kingbird: Cumulative net impact of all existing renewable contracts in the energy portfolio: Approximately $7.3 million per year Approximately 0.62 cents per kWh Cumulative net impact of all renewable contracts in the energy portfolio: Approximately $8.5 million per year Approximately 0.73 cents per kWh starting in January 2016 Cumulative net impact will increase by approximately: $1.2 million per year 0.11 cents per kWh $0.52/month for a 500 kWh average customer

Thank You ~ Questions? Back Up Slides

Appendix – RPS Portfolio After Kingbird

Selection Process Project was offered July 24, 2013 into, and selected as part of, the open SCPPA Request for Proposal process. Determined by PWP to be one of the “best fit/least cost” resources from among almost 300 offers. Also determined to be exempt from Pasadena’s competitive bidding rules as a contract for professional or unique services, and as a contract potentially relating to the acquisition of real property (includes a purchase option).

First Solar Experience SOME COMPLETED FIRST SOLAR FACILITIES Project Location Project Size in MW (AC) Power Purchase Agreement (PPA) Third Party Owner/ Purchaser Blythe Blythe, CA 21 SCE NRG Energy, Inc Copper Mountain 1 Boulder City, NV 58 PG&E Sempra USG&P Cimarron Colfax County, NM Tri-State Southern Company & Turner Renewable Energy Silver State North Primm, NV 50 NV Energy Enbridge, Inc Roadrunner Santa Teresa Santa Teresa, NM 20 El Paso Electric NRG Energy Sarnia Sarnia, Ontario, Canada 80 Ontario Power Authority Enbridge

First Solar Experience (cont.) SOME FIRST SOLAR FACILITIES UNDER CONSTRUCTION Project Location Project Size in MW (AC) Power Purchase Agreement (PPA) Third Party Owner/ Purchaser Expected Substantial Completion Topaz San Luis Obispo, CA 550 PG&E MidAmerican 2014/2015 Desert Sunlight Desert Center, CA PG&E/SCE NextEra/GE/ Sumitomo Agua Caliente Yuma County, AZ 290 NRG/ MidAmerican 2014 AV Solar Ranch One Los Angeles County, CA 230 Exelon 2013 Imperial Energy Center South Imperial County, CA 130 SDG&E Tenaska Copper Mountain 2 Boulder City, NV 58 Sempra USG&P 2015[2] PNM2 NM 22 UOG PNM Walpole Ontario, Canada 20 OPA GE/Alterra Belmont Amherstburg 1 10 DEWA UAE 13 Campo Verde 139 N/A Macho Springs Deming, NM 50 El Paso Electric Maryland Solar Maryland FE Solutions Lost Hills Kern County, CA 32 2015/2016 Stateline San Bernadino County, CA 300 SCE 2016 Silver State South Clark County, NV 250 AGL[6] Australia 159 AGL 2015 Cuyama San Joaquin Valley, CA 40