Solution for Future Electrical Supply in the Middle Europe Nuclear Power Ivo Kouklík

1 CONTENT  ČEZ Group introduction  Energetic situation in the Czech Republic  ČEZ nuclear experience  Nuclear power plant construction - preparation from the beginning

2  The Czech transmission grid is owned and operated by CEPS, 100% owned by the Czech state ČEZ IS A DOMINANT PLAYER IN ALL SEGMENTS OF THE CZECH ELECTRICITY MARKET Lignite miningGenerationTransmissionDistribution Supply for final consumption CEZ Others 5 out of 8 distribution companies 62% of customers 45% 22 million tons 55% 27 million tons 72% 59.5 TWh 28% 23.1TWh 100% 62 TWh* 54% 31.1 TWh 46% 26.5 TWh 38% of customers ZCE, SCE, STE, VCE, SME Source: CEZ, ERU

3 CEZ ABROAD Own assets Trading office Czech republic  Electricity sales (TWh)  Number of customers (million)  Installed capacity (MW) Romania (EDC Oltenia)  Electricity sales (TWh)  Number of customers (million) Bulgaria (3 EDCs in western region + Varna PP 1260 MW)  Electricity sales 8 TWh  Number of customers 1.9 million ,300 Source:CEZ, a. s. Poland (Elcho, Skawina)  Installed capacity (MW)

4 Germany Poland Austria Slovakia Germany CEZ, A. S. - POWER PLANTS Total MW AJ

5 ČEZ ELECTRICITY PRODUCTION IN 2006 Production Installed Power 2 Nuclear MW 26 TWh 10 Coal MW 33,7 TWh 11 Hydro + 1 Solar + 1 Wind MW; 2 TWh Nuclear Power Plant is giant source of energy Source : CEZ Annual Report 2006

6 DECOMMISSIONING OF CURRENT POWER PLANTS AND GROWTH OF CONSUMPTION CAUSE LACK OF ELECTRICITY Domestic consumption with savings Domestic consumption without savings Refurbishment of coal power plants Gas and other renewables Nuclear power plants Hydro Missing production capacity Current coal power plants Production of current power plants vs. consumption growth

7 LOW VARIABLE COST AND HIGH UTILIZATION ALSO GIVE A GOOD CHANCE THAT ATTAINABLE MARGIN WILL COVER FULL COSTS OF NEW BUILDS CO2 cost Full-cost w/o CO2 Prices covered full costs of new builds*: EUR/MWh, 2020 * in West Europe (WACC 7%)  Excepting Lignite in benchmarking allocation scheme the Nukes have the lowest full cost  No risk regarding next CO2 allowances allocation scheme Economies

8 CO2 PRODUCTION Nuclear push down CO 2 emission significantly * Direct and indirect CO 2 production Source : Öko-Institut Darmstadt CO 2 [kg CO 2 /kWh]

9 ČEZ nuclear experience

10 Temelín 2x1000 MW VVER 1000 (PWR) Commissioned 2002 Dukovany 4x 440 MW VVER 440 (PWR) Commissioned 1985 Nuclear NPP MWel AJ

11 Dukovany has been in operation since NPP Dukovany produced more than 14 TWh of electricity last year We have implemented hundreds of modifications Intermediate spend fuel storage was erected Number of employees decreased more then twice Plant operates on increased power – nominal electrical output is 460 MW today We have long experience with safe and reliable operation of nuclear power plants. ČEZ nuclear experience Dukovany

12 ČEZ nuclear experience Temelín Temelín has been in operation since 2003 – the last NPP successfully commissioned in Europe. NPP produced more than 10 TWh of electricity last year. We are preparing dry spend fuel storage We are working on stabilization of operation We have experience with construction and commissioning of nuclear power plants.

13 Political situation in the Czech Republic We carried out several studies and analysis including studies about impact on environment, feasibility study, transport study,.. Our advantage : utilization of the Temelin construction experience ČEZ nuclear experience – new build

14 Schedule

15 How to start with new NPP preparation and construction  Strong support from the government  Public acceptance  Nuclear legislation („Atomic law“ + regulations)  Knowledgeable and capable nuclear regulatory authority  Educational system ( including teachers) – job preparation, high schools, universities, training capacities  Industrial and research capacities  Strong financing for the long time

16 How to start with new NPP preparation and construction  Ability to say what you want to the vendors  Ability to check the vendors offers and designs  Territorial plans  Agreement of municipalities – system of benefits

17 How to start with new NPP preparation and construction Site – many conditions:  Earthquake  Transport – routes, railways, harbors,..  Cooling water  Connections to the electrical grid  Infrastructure  Density of population  ….

18 Conclusions ČEZ is financially strong, continuously growing electrical utility We are ready to start with preparation of new nuclear build in our country and also abroad

19 Thank you for your attention