Into the final steps –

The state of the solar The state of the solar market and the future of

the CSIthe CSI

Max Dworkin

September 16, 2010

REC Solar is one of the largest system integrators in the USintegrators in the USWorld class engineering, construction and procurement capabilities (EPC).

One of the largest and more professional sales organizations in the industry

In depth understanding of the solar industry, and how to serve customer requirements using solar technology.

Experienced management team dedicated to operational excellence and customer satisfactionoperational excellence and customer satisfaction

Lowering cost and creating scalability through significant investment in Oracle ERP system and standardized backend processes.

Proprietary products and services which lowerProprietary products and services which lower systems cost

Workforce of +500 passionate professionals working to make a difference.

Serving customers form more than 13 locations

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nationwide and expanding into new markets each year

Mainstream Energy operates in the downstream segment of the PV value chain; delivering high value systems, services and products .

PV Value Chain Revenue contribution by segment

1.35

7.918.0

$/W

MSE Focus; Delivery of products, s

Focus of our

upstreampartners

1.35

.45.4

6.0

3.60Down-stream 45.5%

products, systems and

services

.451.05

1.35

1 12

4.0

Up-1.12

.20.59

2.0

4.31Up

stream 54.5%

Confidential – Not to be printed, presented or distributed without express written consent from REC Solar Inc. Source: Photon/Rogol 2006

IT’S OUR JOB TO STRETCH TECHNOLOGY AND

Confidential – Not to be printed, presented or distributed without express written consent from REC Solar Inc.

IT S OUR JOB TO STRETCH TECHNOLOGY AND INDUSTRY EFFICIENCIES. . .

BUT IT WILL NOT BE AN EASY RIDE AS WE

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NEED TO GET THE COST DOWN TO INCREASE DEMAND.

Exponential growth in solar manufacturing capacity is lowering cost. This in combination with increasing support by state and federal government is resulting in rapidly by state and federal government is resulting in rapidly increasing demand.

50000

Solar (PV) Industry Growth

44149

35000

40000

45000

ty

21630

30570

20000

25000

30000

aw

att

s C

ap

aci

t

55007913

12095

15761

10000

15000

20000

Meg

a

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1050 1407 19853073

0

5000

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Our view: Total System Cost/Watt DC: Commercial $4.30, Residential $5.50Commercial $4.30, Residential $5.50

6.00

4.00

5.00

CostInstallation,Racking,BOS

3.00

Cost$/W

GP

Inverter

Module

2.00

1.00

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Module

0Commercial Residential

CSI Experience To date:

• > 3500 submitted application since 2007+ Overall Positive experiencep

Created significant demand in market

- Additional administration burden

- Additional cash flow management burden

• Field level support from Utilities was relatively good good. – Slower to execute automations and improvements but always

open to discussions and input.

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CSI Going Forward:• Market Environment Going forward• Market Environment Going forward

- High initial demand and rebate deployment has out passed downstream efficiency gains.

- Module prices have stabilized with forecasted nominal declines in pricing.

How will this effect demand in the market and what will be the industries reaction?

• Support plan going forward. M k i ill di – Market reaction will dictate next steps.

- Additional MW deployment

- Policy changes

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- Equipment prices

- Technology improvements

Summary• CSI has been relatively successful in the first half • CSI has been relatively successful in the first half

of its existence during early adopter market.

• Total system cost is about hard analysis in the • Total system cost is about hard analysis in the field, not about marketing promises.

• Work towards continued improvements in Work towards continued improvements in consumer value proposition through: Technology, Policy, Equipment, Installations, and pricing.

• Develop plans for both market acceptance or denial if other external factors cannot keep pace.

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Sample of Partners Customers

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Thank you for your attention! Questions?

Thank you.i h S h l 389 k

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yPoway High School, 389 kW