1. Asset Management Report – Aug 2017
CPV Power Plant No.1 (RF) (Pty) Ltd
Distributed via – 27 September 2017

2. Index Executive Summary Key Issue Summary Operating Summary
Environmental Summary
Financial Reporting
Ownership & Funding Structure
ED & SED
Other Matters
Media
Contact Details 2

3. Executive Summary
This monthly Asset Management Report provides an analysis of and comments on the current financial and operating status at the CPV 1 Power Plant for the month of Aug 2017.
Highlights:
Energy produced year to date in line with modelled values, slight reduction in August due to inverter retrofit & production ratio
Plant availability remains at high levels
Operations and maintenance continue as scheduled
Health & Safety – no reported incidents in the reporting period
Environmental compliance at acceptable levels, no fines proposed or issued
ED & SED fully compliant
Financial cover ratios remain at high levels
Key Focus Areas:
Resolution of open R&O items with Group 5 – refer slide Key Issue Summary (slide 4)
Grid Code Compliance - refer slide Key Issue Summary (slide 4-6)
All spare parts at site as per the Spare Parts Agreement, full site inventory currently underway
AFS finalization for 2014 & 2015 in progress - refer slide Key Issue Summary (slide 4)
Warranty claim management ongoing where required
Final step of establishing the plant's capacity of AC generation as measured at the inverter output point as per the Arbitrator’s finding was completed by Ron Conway. Results aligned with expectations, experts on both sides to meet to review the data.
Additional storage 99 % completed with loading of the spare parts ongoing. Confirmation still outstanding of the signing off date of the COC. Costs for the fire system as per the finalized, fire design & installation to be concluded in the following weeks
Water flow & flooding investigation report issued, quotes to be obtained to insert additional culverts at the railway line, build berms & channels to prevent significant flooding in a 50 or 100 year flooding scenario. Alternative solutions to be investigated
The BGCMA will be issuing formal correspondence confirming that the plant does not require a water license or a General Authorization (GA) as the plant is extracting volumes below those of the thresholds requiring application for a GA in terms of the Water Act. Water usage levels will be monitored going forward & logs kept for BGCMA reporting & audit requirements in terms of the exemption. Reported levels included in the relevant slides.
The energy produced this month is lower than the modelled energy, this could be due to a number of external factors. The Production Ratio is generally poor this time of year, as can be seen for the previous 2 years. We also have the retrofit of the inverters happening currently
In Monthly Energy Production report, column 6, “% available sun hours per day” has some days not available due to server errors on the CBI SCADA system, this is in the process of investigation
The values for Production Ratio has been repaired. The PVSyst models have been loaded, but we are in the process of excluding agreed exclusion events from the modeled data 3

4. Key Issue Summary Group 5 Annual Financial Statements
The Action List is discussed with each Action Owner on a bi-weekly basis. Progress is tracked and items are being addressed.
AM team is managing the open items to conclusion.
Action item list can be requested if required.
Annual Financial Statements
The EY Engagement was concluded early June. The EY team has reviewed all the relevant agreements and drafted a presentation in terms of the historic facts, which the AM Team, Webbers & Mazars vetted in terms of correctness. Draft opinion reviewed by AM and to be issued formally next week. EY will then be in the position to conclude their opinion on the matter (estimated end of August). Opinion to be presented to the Board for approval and 2014 & 2015 AFS to be concluded in September PWC confirmed the audit dates for the outstanding years as September & October. Conclusion of the 2016 & 2017 AFS to follow, official approval of the 4 sets of AFS to be concluded in the AGM to be scheduled for November. The 2018 audit cycle planning to follow in December & January for both CPV1 and the Bond SPV.
Grid Code Compliance
Exemptions were tabled for presentation at the GCAC meeting on the 26th of July at 11h00. The AM Team (Jannie & Ziska) and Aurecon presented on behalf of CPV1. Presentation attached for information. Current exemption expires 19 August 2017, requested 12 month extension. Formal feedback was requested in terms of the expiry in June and again in August, considering the approval of further exemptions are delayed due to the cancelling of the May 2017 GCAC sitting.
Target Mchunu (GCAC)communicated the following – our notes in orange – No amendment for month of August:
Power Quality - With regard to your Power quality exemption, it has been noted and working on the solution that will be communicated to you once the NERSA board has approved it. Confirmed that as a prudent operator we have done all in our power to obtain the necessary exemptions, we now have to wait for the correspondence from NERSA as indicated by the GCAC.
Reactive Power Capabilities - GCAC Decision: Exemption not necessary, because of the modifications that were done on the plant, the replacement of the inverter transformers, the RPP will have to initiate the RETEC process again for retesting. Also, a grid study detailing the performance of the plant when conditions are favourable will have to be submitted to RETEC. If the plant shows noncompliance based on the grid study, the RPP then have to initiate the governance process. Grid study in progress, status on update provided in correspondence.
Provision of Data and Electrical Dynamic Simulation Models - GCAC Decision: Write to RETEC to request extension on the provision of the validated model , stating clearly the reason for the delay. Correspondence submitted to RETEC requesting extension & providing necessary clarity. 4

5. Key Issue Summary Grid Code Compliance (continued) 5
GP Tech Workshop conducted on the 30th of August with all role players – GP Tech, Pele, TAP, Digsilent, Group 5, Angwa & Aurecon
Key activities identified to be concluded in the coming weeks (refer Gantt chart on the next slide):
GP Tech to update the relevant inverter models, activate synchronization boards in the inverter via software update, implementation of emergency stop functionality in inverters and assist in resolving communication issues during the course of September & October
Transformer operational procedures to be defined & documented and to be considered in subsequent processes & procedures by the end of next week
Powerplant controller to be specified by end of next week
VSDs at the plant to be balanced & investigation into possible staggering to be concluded to assist in resolving the harmonic distortions by mid October
Power quality meter to be installed by end of September to measure the current power quality on a permanent basis and to track improvement measurements mentioned above
TAP scope of work to commence to automate storm mode in the instance of complete grid disconnection once items above are resolved
Grid code compliance study & compliance assessment in progress (planned completion mid November)
Grid code compliance testing to start mid October and end mid January 2018
Power quality assessments to be concluded by mid December
Validation of the models to commence in November & be concluded in first quarter 2018 5

6. Key Issue Summary
Grid Code Compliance Project Schedule (updated as and when required) 6

7. Operating Summary Energy Production 7
The total energy produced for the month was kWh (1st to 31st August 2017)
Compared to the modelled energy of kWh (PV-Syst incl. losses & degradation), an underproduction of kWh. (-5.3%). This is due to a low Production Ratio. This is common at this time of year. The retrofit of the GP Tech inverters also affected the production during this month.
Compared to the previous month with kWh (1st to 31st July), an decrease of kWh. (-1.61% Month to month decrease)
Compared to the last Year production of kWh (1st to 31st August 2016), an decrease of kWh. (-2.08% Month to month decrease)
Comparison year on year energy produced modelled compared to actual shows steady increase year on year. 7

8. Operating Summary continued
Reportable Incidents
The energy produced this month is lower than the modelled energy, this could be due to a number of external factors. The Production Ratio is generally poor this time of year, as can be seen for the previous 2 years. We also have the retrofit of the inverters happening currently.
Outstanding water license has been actioned by CPV1. Current use of water is in contravention of legislation. CPV1 is working with the ECO to resolve this issue as quickly as possible with the Department of Water Affaires.
In Monthly Energy Production report, column 6, “% available sun hours per day” has some days not available due to server errors on the CBI SCADA system, this is in the process of investigation.
The values for Production Ratio has been repaired. The PVSyst models have been loaded, but we are in the process of excluding agreed exclusion events from the modeled data.
Production Ratio
For the period the Substation network was down from the 8th February until the 4th of May there are no Production Ratio values available, the May value reflects production ratio from the 4th of May onwards as the Substation Network was re-established on the 3rd of May during the day.
The data from the 8th February till the 4th May has not been able to be restored and is permanently lost.
Summarizing the performance of the month please find below the comparison of the Production ratio: 8

9. Operating Summary continued
Meteorology
The Temperatures in August peaked at °C with an average of °C during production hours. The averaged DNI was W/m² and the averaged peak DNI was W/m².
The total DNI energy received for the month of August was kWh/m² (1st to 31st August)
compared to the value of the Typical Meteorological Year (TMY) of kWh/m² the irradiation was above average of 8.61 kWh/m² (4.97%)
compared to the previous month Irradiation of kWh/m² (1st to 31st July), an increase of 1.28 kWh/m² (0.71% Month to month increase)
compared to the last year DNI Energy received of kWh/m² (1st to 31st August 2016), an increase of 3.27 kWh/m² (1.83% year to year increase) 9

10. Operating Summary continued
Meteorology (continued)
The rainfall in August was in total 6 mm and in rained over total amount of 3 days.
The average rainfall for August as per [average from 2002 – 2012] should be 27 mm. Thus the rainfall received in August is below the average rainfall for this Month.
The plant went into Storm Mode, due to high wind speeds in excess of 12 m/s on 9 occasions during the hours of production for the total duration of 24 h 16 min.
Preventative Maintenance
In accordance with the O&M Manual the Pyrheliometer sensors are cleaned on a weekly basis. The complete plant was washed over the six weeks period, and completed on the 23 July. The washing will continue as per contractual requirement.
The regular inspections of the substation and the field equipment has continued as scheduled.
The regular monthly maintenance on the Substation and Generators was done in the third week of August.
Preventive Maintenance on Tracker level is continuing as planned. Visual inspections of the tracker systems to see if there are any signs of damage or loose cables as per the quality check sheet have been completed and limit switch checks are scheduled to start next month.
Preventive Maintenance on Balance of Plant equipment is going forward as planned. All the transformers are being checked for leaks, Substation Transformers are repaired transformer 2 is being cleaned and are planned to be re-energized this month. The inverters are in the process of being retro-fitted in order to enable an extension of the warranties from GP Tech. Assessments into the condition of the inverter AC handles will be conducted at the beginning of the month and checks for all the Perspex covers will also be done this month. 10

11. Operating Summary continued
Reactive Maintenance
Various tracker encoders failed on the trackers. These were replaced upon failure by the O&M Team. The O&M team is currently investigating a high loss of 4Q sensors. 1 tracker sustained serious damage due to a failed limit switch.
Some Actom transformers have shown signs of leaks again, we are busy with the checks to see extent of the transformers for leaks, before we are confident that the work has been completed correctly.
All failures were if necessary reported to the responsible party, e.g. Soitec, CPV1, CBI and where required GP Tech.
Availability
Plant’s availability remains at high levels –
The values indicated in Table 4 are based on equipment being out of operation for more than one full production day. The 100% availability indicates that all plant equipment was available for the complete duration of August, however, minor (short outages) are not accounted for.
Health & Safety
The staff complement on site during the month of August was 47, which includes the subcontractors Group five, Solar O&M Services, Thorburn Security, Brandwacht Steel, Pele Green and the RESA O&M Services Staff. The number of LTI free hours for is compared to the target LTI Free hours for the project of There were 2 minor incidents this month, no reportable cases.
Resource Usage
Resource Usage Summary for the month in review: 11

12. Operating Summary continued
Contractors & Sub-Contractors on Site during the month under review:
reSA Services O&M Sub-Contractor
Group 5 O&M Contractor
JR Noble Module Washing Company
Thorburn Security Company
Brandwacht Steel Warehouse Construction
Pele Green Energy Asset Manager 12

13. Environmental Summary
Feedback W Nel – Environmental Officer July 2017
Compliance issues
Percentage compliance achieved during the site audit for 24 August 2017 = 95.4 % (Compliance with the EMP is regarded as unacceptable if it is below 80 %)
Score obtained 90.7 out of 95
Non-compliance noted on the following items
All site clearance and bulk earthmoving activities were completed. At the time of the audit no open excavations were present.
Recommendation - Ensure that all spoils left in areas where earthworks have been completed are levelled and the areas revegetated to minimize potential erosion and generation of dust.
A pile of used rubber piping had been documented on a number of occasions during the previous ECO contract. These pipes were still present on site. These pipes may pose a health and safety risk as it provides a habitat for snakes and vermin to locate. It is however noted that the pipes are in the process of being moved. The pipes had been sorted for storage and removal.
Recommendation – Ensure that the all waste types are appropriately disposed of and recorded.
At the time of the audit, hydro-seeding was completed and evidence of establishing in the areas between the solar panels, however in some areas it was evident that employees had been driving over newly seeded areas even though it had been closed off.
Recommendation – seeded areas are not driven over damaging newly germinated vegetation.
At the time of the audit alien vegetation was observed on site. These include species e.g. Oldman Saltbush etc., which requires to be removed.
Recommendation – Ensure all alien vegetation is cleared and properly disposed of.
At the time of the site inspection the majority of construction activities had been completed. Some building rubble and other left-over materials have been observed on site.
Recommendation – Ensure that the building rubble and other leftover materials are appropriately stored or disposed of as per the new waste management commitments.
No fines recommended 13

14. Environmental Summary continued
Status of Water Permit/License
At the time of the audit the audit the current General Authorisation was not valid. The Breede Gouritz Catchment Management Area (BGCMA) had been contacted to follow up with the progress based on correspondence provided by Mr Wuellner. A meeting with BGCMA to discuss the current requirements for a GA application had been arranged for Wednesday 29 June Based on the feedback from the meeting with BGCMA, the client had been advised that based on their documented volumes abstracted from the borehole it does not trigger a GA application. The feedback from the meeting had been provided to the client in an and will be drafted in a formal response when official feedback had been received from BGCMA. We are awaiting the official feedback from BGCMA to that regard.
Monitoring of Water Usage – At the time of the audit only a small number of activities were in progress and water usage use was within the thresholds allowed for in the current General Authorization. 14

15. Environmental Summary continued
Photographic Evidence of Environmental Issues 15

16. Financial Reporting Modelled vs. Target vs. Actual Energy Harvested
General Remarks & Interpretation Notes:
Modeled DNI is the irradiation value of the solar assessment on the outset of the project
Modeled Energy is the energy based on which the original financial model was calculated. This includes the calculation of degradation, which is 0.4% for the P50 case
Target Energy is the output based on the actual / forecast DNI
Target Energy is the contractually defined value for the calculation of the production ration guarantee refined by Hatch dated 8 June 2015 (H – Production Ratio Calculation Review – – Signed)
Actual Energy is the amount of MWh as invoiced to Eskom
Actual Production Ratio is the ratio of Target Energy and Actual Energy produced
Contractual Production Ratio is the ratio of Target Energy (including Exclusion Events and Actual Energy)
Monthly Comments:
DNI actual for August 2017 was 9 units higher than modeled. Overall 27 units above modelled value for the year.
The actual energy yield for August 2017 was 5.3 % lower than modelled, mainly due to lower production ratio & the inverter protection reworks. Tracking in line with the annual modelled production value. 16

17. Financial Reporting continued
Development of Forecast vs. Budget
General Remarks & Interpretation Notes:
Budget is the multiplication of the Modelled Energy with the tariff escalated with 5.7 % in accordance with the original financial model
Actual is the multiplication of the estimated value of energy produced with the actual tariff
Monthly Comments:
Reported revenue 1.3 % lower than budget, linked to production.
Expenses lagging, mainly due to O&M Fee not booked in August, will be booked in September. ED fees to be booked in accordance with spent year to date.
Budget 2017_2018 approved at the CPV1 Board Meeting in July. 17

18. Financial Reporting continued
Details of Revenues and Expenditures
General Remarks & Interpretation Notes:
Revenues currently consist of electricity sales only. CPV1 placed a contract with a consultancy for the sale of CO2 emission certificates. The application process is still ongoing, the returns are not expected to be significant.
The expenditures follow the structure as presented in the financial model.
Monthly Comments:
Revenue explained on prior slide
Expenses lagging, mainly due to O&M Fee not booked in August, will be booked in September. ED fees to be booked in accordance with spent year to date. 18

19. Financial Reporting continued
Short Form of Profit & Loss (Fiscal)
General Remarks & Interpretation Notes:
There is no difference in the treatment between revenues and expenditures between the management accounts and the fiscal accounts
With regards to depreciation, in the fiscal accounts an accelerated method can be applied based on the following formula – Y1=50%, Y2+30%, Y3=20%
Interest expenses are those for the bond as agreed in the bond offering circular. There is a possibility of small deviations where cut off dates are slightly different or the year has 366 days
Corporate income tax is not expected to be paid in the next years due to the loss carried forward from the high depreciation values
Monthly Comments:
Interest expenses and income tracking as expected.
Depreciation as expected. 19

20. Financial Reporting continued
Profit & Loss Deviations (Forecast vs. Budget)
General Remarks & Interpretation Notes:
The budget figures compared to the financial model are adjusted for the ED fees and the lower management fees as agreed upon in June 2015
Eskom has generally increased the grid service charge. CPV1 is in the process of trying to recoup some of the costs from Eskom
Monthly Comments:
Revenue deviation explained on prior slides
Standard O&M Costs deviation due to August fee not booked. Will follow in September
Life cycle costs relate to shipping & storage costs of the last spare parts package as noted in prior packs
ED fees to be brought in line with actual spent in September
Insurance fee budgeted as once off expense in April, fee now booked on monthly basis
Depreciation tracking as planned
Interest income & expenses tracking as planned
No corporate income tax due 20

21. Financial Reporting continued
Quarterly Deviations of Actuals and Forecast
Monthly Comments:
We refer to previous slides for the explanations on each budget item 21

22. Financial Reporting continued
Direct Cashflow
General Remarks & Interpretation Notes:
Cash out for construction period – the funds for closing the R&O agreement have been part of the total uses of funds of the project. Besides the fact that they are expensed later than foreseen in the budget they do not constitute a cost overrun. The exceptions – remainder of the EAR insurance which costs are higher due to the additional period to be covered and additional costs of Hatch for the longer site supervision, cash out for storage facility to store the additional spare parts
Monthly Comments:
Cash in relates to energy revenue, Eskom payments received 40 days after invoiced (effectively 2 months), no overdues
Cash out for operations directly relate to expenses incurred including VAT component
Cash out for construction period:
Final warehouse cash flow expected September
Cash outflow related to the GCC process included for Aug to Dec If remedial action is required, costs to be revised during last quarter of the FY. Shifted out to latter part of the FY
Touwsrivier Trust Development fee planned for Oct 2017 22

23. Financial Reporting continued
Cashflow Waterfall
General Remarks & Interpretation Notes:
The contractual amount of debt service reserve account = R 139m
The contractual amount O&M reserve account = R 9.8m
Minimum cash in the proceeds account = R 2m
Disbursement of equity after payment of the coupon of the bond
Monthly Comments:
Next Debt service payment planned for December 2017
Distribution to Shareholders planned for July to be distributed partly distributed in August, but only accounted for in September. Balance distributed in September due to SARB approvals
Contractual cash reserves stays in place (DSRA, & OMRA and R 2 million residual cash balance after disbursement) 23

24. Financial Reporting continued
Balance Sheet of CPV1 (w/o Bond SPV)
General Remarks & Interpretation Notes:
No comments
Monthly Comments:
No comments 24

25. Financial Reporting continued
Calculation & Graph of Historical and Forward Looking Covenants
General Remarks & Interpretation Notes:
Principle of calculation of debt service coverage ratio as per facility agreement:
Cash in – all amounts received and those amounts invoiced in the period
Cash out – all amounts paid out over the period plus those amounts which invoices were received in the period
Notes:
Ratio needs to be above 1.2
Lock in Ratio needs to be below 1.15
Monthly Comments:
The cover ratios despite the costs related to the harmonics/grid code compliance, construction cost for additional storage facilities and other items 25

26. Ownership & Funding Structure
PGE
PIC
SOITEC SA
PIC
100 %
Class A Pref. Shares
100 %
Funding
COMMUNITY TRUST
PGE CPV SPV
CPV1 Equity
100 %
SOITEC GMBH
35 %
40 %
20 %
5 %
45 %
BOND SPV
55 %
CPV1
Finance 26

27. ED SED Summary Management Summary: Aug 2017
The Touwsrivier household data collection survey was conducted as a means to continually
bridge the communication gap between KP and the community at large.
Final work readiness training for both the Johannesburg and Touwsrivier cohorts.
Began planning work on the Touwsrivier Experience to take place on the 29th – 30th September 2017.
Total August 2017 Spend (incl. MNG fee): R179,715
SE.ED Programmes Spend Breakdown
Experience Works
Bursary Fund
Enterprise 4 South Africa
Starter Pack
Community Jobs Fund (Experience Works 360)
No. of Participants 4 5 6 8 7
Investment per participant
R131,200
R57,800
R34,540
R5,715
R31,830
Total Programme Budget
R656,400
R1,157,200
R345,400
R114,300
R318,300
% of Budget
15%
26% 8% 3%
SED General
ED General
June Spend
R9,740
R13,611
R642
R14,578
R27,265
R25,350
R25,000 27

28. Touwsrivier SE.ED Programs Quarterly Implementation Plan
ED SED Summary
Progress Update
On Track
Caution
Critical
Touwsrivier SE.ED Programs
Quarterly Implementation Plan
Status
Progress
Experience Works
Conducted final work readiness programme
Programme implementation on track
Bursary Fund
1. Recruitment to be conducted in September 2017 for 2018 programmes
5 candidates completed their programme in June 2017.
Enterprise Starter Pack
Conducted final assessments for starter pack cohort. Graduation date: September 2017
Registered SF Business Solutions to conduct community survey on behalf of Knowledge Pele
Enterprise 4 South Africa
Finalized registration/business formalization of 2 businesses (Azzies and Rising Star)
Community Jobs Fund (Experience Works
Conducted final work readiness training
Touwsrivier Newsletter
Conducted newsletter writing work shop to prepare for The Touwsrivier Experience 28

29. ED SED Summary
Pictures: Starter Pack – review Knowledge Pele Newsletter for overview 29

30. Other Matters
Events of Default – none recorded during reporting period
Legal Claims – none recorded during reporting period (except for finalization of arbitration outcome with Landlord) 30

31. Media
General Site Photos – August Site Visit 31

32. Thank you & Contact Ziska Mc Gilton Pele Energy Group
Senior Asset Manager
Mobile: +27 (0) 32