NRG Focus - June 2012 Issue

JUNE 2012

™

A GLOBAL OUTLOOKTECHNOLOGY | REVIEW | UPDATE

Key-Enabling Technology providing

“Negative” Cost Base Syngas

Successful Waste-to-Ethanol Tests

Wuhan Kaidi, China

W-15 Gasifier - PDP

Refueling

Solution for Island Countries

AIR PRODUCTS TEES VALLEY, UK

For our 5th edition of NRG Focus we will

continue to bring clarity to experiences and

activities that help optimize our

Westinghouse Plasma gasification

technology. In this issue, we will provide

updates on the Tees Valley, UK and Wuhan

Kaidi, China projects. As well, we will touch

on successful Waste-to-Ethanol tests. It has

been a busy quarter and we are pleased to

share some of these activities and

significant milestones through this edition.

Please read on and we hope you enjoy this

latest edition of NRG Focus.

From the team at Alter NRG

Content & Design: Alter NRG Corp. - Corporate Development Team

Past Issues: www.alternrg.com/investor_relations/presentations/publications

Alter NRG Corp. is a registered trademark. All other company and product names may be trademarks of their respective owners. The information contained herein cannot be reproduced in any format without legal permission from Alter NRG Corp., and is subject to change without notice. Copyright © 2012. All rights reserved.

Cover Photo: Site location for the Tees Valley Renewable Energy Facility, UK

Contents

www.alternrg.com

Chief Executive Officer ________3• Walter Howard’s Profile

SPOTlIGhT ON

Tees Valley, UK ______________ 4-5• Air Products - Renewable Energy Facility

Key-Enabling Technology __ 6-7• Liquid Fuels

• Negative Cost Base Syngas

Bio-fuels _____________________ 8-9• Successful Waste-to-Ethanol Tests

• Westinghouse Plasma Center provides

Liquid Syngas

• Flex Ethanol

• GM, Australia

W-15 - PDP ________________10-11• Process Design Package

• Westinghouse Plasma Center provides

Liquid Syngas

• Flex Ethanol

• GM, Australia

Refueling _________________ 12-13• Solutions for Island Countries

Project Update ________________14• Wuhan Kaidi, China

Conference Update __________ 15

ISSUE | JUNE 20122

Profile: Walter Howard, CEOWalter Howard became Alter NRG’s second CEO on

March 8, 2012 succeeding Mark Montemurro who

continues to be a Director on Alter NRG’s Board.

Alter NRG (“Alter NRG” or the “Company”) is pleased to announce that Walter Howard

has joined Alter NRG as the Chief Executive Officer (“CEO”). Mr Howard brings more

than 30 years of global project development and specifically, renewable energy

experience including waste-to-energy, wind and water projects. Within these industries

Mr. Howard has successfully executed technology development and implementation;

project development and execution; and project finance. Mr. Howard has held CEO,

COO, CFO, and SVP executive positions with utility leaders including General Electric,

American Water, US Generating (an affiliate of PG&E and Bechtel), Noble Environmental

Power, J.Makowski Co. Inc., Ze-gen Inc. and Poseidon Resources. Mr. Howard holds

BSCE and M. Eng. degrees from Cornell University, an MBA from Harvard Business

School and has been a licensed Professional Engineer in the State of New York. Mr

Howard will be working primarily out of the Calgary Head Office.

Q&A with your new CEO

Over the past 30 years you’ve been successful in CEO, COO, CFO

and SVP roles - what key factors underlie how you work?

First, is a realistic and focused vision of what you want to achieve and clear expectations

of the roles different parts of the organization play in achieving that vision.

Second, you need to have, or assemble, the tools to reach that vision. We have those

tools. They include a team with values such as honesty, respect and openness, and a

winning technology base. Importantly, it is about communicating and then providing

responsive services to ensure customers and shareholders see solid execution and

value creation. And it’s about good financial management. I am very focused on

ensuring an organization has a strong financial position.

What attracted you to the role of CEO of Alter NRG?

Simply put, the Westinghouse Plasma technology is the best in class and is the industry

leader. I was very attracted to the challenges and opportunities it presents in terms of

capitalizing on a strong technology and translating that into profitable growth, while at

the same time contributing to the good of the planet.

What does success look like for you in this role?

I am looking forward to building on the excellent platform established by previous

management, particularly in areas such as project execution, further progress on the

design and engineering of our core offering at the same time as focusing on increasing

our sales pipeline and responsibly managing our resources. Through solid execution, I

am confident that Alter NRG can improve investor sentiment.

“IamverypleasedtojoinAlterNRGastheCEO.The

Companyhastheindustry

leadingplasmagasification

technologywhichoffersa

sustainablesolutiontoboth

solidwastemanagement

aswellasrenewable

energygeneration.Having

multiplereferencefacilities

coupledwiththerecent

announcementofa$22.4

millionpurchaseorderfrom

aFortune500customer

putsAlterNRGinastrong

positionforfuturegrowth

andaddingshareholder

value.Iamexcitedtobring

myexperienceinrenewable

energyinfrastructure

technologytoAlterNRGto

acceleratetheadoptionofthis

importanttechnology.”

Walter Howard,

Chief Executive Officer of Alter NRG

3 NRG FOCUS | BY alter nrg

Waste-to-Energy Project inTees Valley, UKThe first quarter of 2012 was a significant milestone as Alter NRG began the

fabrication of the Westinghouse Plasma Gasification Solution for Air Products.

The fabrication is approximately 7% complete at March 31, 2012 and is

progressing on time, and on-budget (see photos below). The project is

progressing full swing and we expect a very busy remainder of 2012.

On December 22, 2011 Air Products issued a purchase order for $22.4 million for the Westinghouse Plasma Gasification

Solution for their Tees Valley project in Northern England. The project intends to take 950 tonnes per day of processed

household waste and convert it into 49 MW of electricity, enough to power 50,000 homes. This represents a major commercial

milestone for the following reasons:

The sale of our larger scale gasification island is a major milestone as it provides validation that our product has not only been

acknowledged, but has been embraced by a renowned and reputable Fortune 500 Company. This validation is opening up many

other commercial opportunities and attracting new customers that are looking for renewable energy solutions. Tees Valley

Project is a significant milestone in the evolution of the Westinghouse Plasma Technology:

●● Validation by a well respected Fortune 500 company

●● Scale-up of our gasification island

●● Endorsement by the UK government that

plasma gasification qualifies for special credits

and incentives

●● Provides growing revenue for 2012

●● Intention to build 5 facilities under the existing

license agreement

Air Products is the perfect example of a strong

customer and a relationship that has developed

over time. We first started doing business with

Air Products in mid-2008 as they were looking to

re-enter the energy-from-waste market (they

previously owned incinerators). They selected our

technology after thorough due diligence and

signed a license agreement in February of 2009. Since that time they have been diligently undertaking the business

development of their first facility with dedicated full-time staff working on their plasma gasification business plan supported by

our core technology. It is satisfying to see our collective years of hard work and dedication pay off and to receive the purchase

order for this very large facility which will take 950 tons per day of waste and convert it into 49MW of power, enough to

permanently power 50,000 homes. This is a tipping point.

We are not stopping here. Air Products has a license agreement and has publicly stated its intentions to build five of these

facilities in the near term. They are focused in the United Kingdom and are continuing their business development efforts on

their second project. Air Products is an extremely strong strategic customer and we look forward to continuing to support their

efforts, removing waste from landfills and creating clean and renewable energy solutions.

SPOTLIGHT ON

Tees Valley projects in progress at the KNM Group of Companies, Gebeng, Malaysia

ISSUE | JUNE 20124

Waste-to-Energy Project inTees Valley, UK

UK Government’s Commitment to Support Renewables Industry

The clarity on the renewable energy banding is a key necessity for Air Products to continue

advancing their Tees Valley project for Board approval, and is the last major hurdle holding back this

project. The project represents a $20-25M plasma sale opportunity for Alter NRG.

Of particular interest:

Incineration facilities (with combined heat and power) are now proposed to receive 0.5 ROC’s per megawatt hour, whereas advanced

gasification, like Alter NRG’s Westinghouse Plasma Gasification Technology, receives 2 ROC’s. This shows the favorable policy for the

more energy efficient and environmentally sustainable gasification processes vs. incineration in government policy. The reduced ROC’s for

incineration could put some incineration projects in jeopardy which has the potential to be an opportunity for Alter NRG in the UK market that

we will be assessing moving forward.

The UK Department of Energy and Climate Change recently announced its long anticipated proposed changes to the Renewable Obligations Certificates (ROC’s).

Renewable electricity technologies

Current support, ROCs/MWh [1]

Proposed ROC support/MWh [2]

Other proposed changes

Advanced gasification 2

2 in 2013/14 and 2014/15; 1.9 in 2015/16 and 1.8 in 2016/17

Proposed change to definition and merger with advanced pyrolysis

“AirProducts,alongwithourtechnologypartner,AlterNRG,seeTeesValleyasthefirstofanumberof

advancedgasificationfacilitiesthatwewishtodevelopintheUK.TheUKisseekingmoresustainableways

tomanageanddisposeofitswaste,andislookingtodiversifyitssourcesofelectricitygeneration:our

technologyisabletodeliveronbothcounts...AirProductshopestobuilduptofiveadvancedgasification

plantsintheUKinthecomingyears,amountingtoaninvestmentofmorethan£1bnandwiththepotentialto

generatearound250MWofelectricity.” -IanWilliamson,AirProductsEuropeanHydrogen

andBioenergyDirector(Aug11,2011)


Key-Enabling TechnologyWestinghouse Plasma Technology is the Key Enabling Technology for the

energy-from-waste industry as it can convert many types of waste feedstocks

into a clean Syngas. This clean Syngas can be further converted into electricity,

ethanol, gasoline, diesel fuel and a replacement of fuel oil. Better economics

and environmental performance make plasma gasification the next generation of

waste conversion technology.

The Westinghouse Plasma technology is a commercially proven process to convert all types of waste into valuable energy. Our

process has significant benefits which have attracted world-leading innovators as our customers. We offer a range of standard

products for many feedstocks and various types of projects.

SYNGAS

FUEL OILREPLACEMENT BIOFUELS

GASOLINE JET FUELSDIESELETHANOL

FUEL CELLSENGINES

STEAMCYCLE

COMBINEDCYCLE

Feed MaterialReceiving,

Storage& Conveying

IndustrialWaste

CommercialWaste

WasteBiomass

HouseholdWaste

MedicalWaste

Tires

etc.

PlasmaTorches

FEED HANDLING PLASMAGASIFICATION

SYNGAS CLEAN-UP &GAS COOLING

UNMATCHED APPLICABILITY TO MARKETABLE COMMODITIES

FLEXIBLE PROCESSGASIFIER

WIDE VARIETY OF PRODUCTSHIGH $ VALUE

Air orOxygen

Slag & Recovered Metals

POWER

FISCHER-TROPSCH

CALATLYTICBIO

FERMENTATION

WIDE VARIETY OFFEEDSTOCKSLOW $ COST

Westinghouse Plasma Gasification has Significant Commercial Advantages

Minimal feedstock preparation ● Typically a pre-sorting of recyclables and a one stage shredding of the material

Handles a wide range of feed compositions ● High moisture content

● High inert content

● Blends any number of solid or liquid feedstock’s

● Ability to blend feedstocks reduces project feedstock risk and significantly increases project economics

High reliability ● Operates in rugged industrial applications

● Over 500,000 hours and 20 years of industrial use of the plasma torches

Low emissions and waste by-products ● Syngas, after cleanup, burns clean like natural gas

● Vitrified slag is inert/non-leaching and is being used as a construction aggregate

● Low greenhouse gas footprint when compared to alternative methods of creating power

ISSUE | JUNE 20126

In the biofuels configuration, the Westinghouse plasma gasifier will

process a wide range of waste materials as a feedstock(s) and create a

commodity grade clean syngas. This syngas is then processed through a

Fischer-Tropsch (FT) systhesis to produce biofuels. By controlling the

amount of syngas as a percentage of the total delivered fuel, the facility

will benefit from the significant economic and environmental attributes of

the clean syngas.

The Westinghouse Plasma Gasification technology is commercially proven

and capable of processing a variety of waste materials to generate a

commodity grade syngas. Syngas is a versatile product that can be used

to replace fossil fuels and generate power, providing a scalable solution

capable of generating enough syngas for up to 1200 bbls/day per module.

Westinghouse Plasma Corp. provides a complete design build solution for

the Biofuels market. Our project scope is designed to minimize execution

risk and provide the best possible solutions and service.

SCAlE $60/t $80/t $100/t

G-65 $0 ($2.40) ($4.75)

Assumptions:

Capital per MMBtu for clean syngas is ~$2/MMBtu

Compression to 400psig per MMBtu is approx $0.75/MMBtu

$60/t MSW, <$60/t Biomass, $6/GGJ Natural Gas

Currently, the cost of feedstocks and its availability is plaguing the Biofuels

industry. However, the Westinghouse Plasma Gasification technology is

positioned as the next generation solution to produce “NegativeCostBase

CleanSyngas”.

Westinghouse Plasma Gasification Redefines the Economics of Biofuels Industry

Westinghouse Plasma has many advantages, including:

● Key competitive advantages of

Westinghouse Plasma Gasification

● Proven feedstock flexibility with an

energy rich syngas product

● Ability to generate zero cost syngas

● Environmentally Superior and

commercially proven


Successful Waste to Ethanol Test

Waste to Biofuel Testing Successful at

Westinghouse Plasma Demonstration

Center in Madison, Pennsylvania

Waste to ethanol and other biofuels (diesel, gasoline, etc.) is a growth market. Westinghouse Plasma is working with several biofuel producers to jointly model waste to biofuel solutions. The ability to convert waste to biofuels has several market changing characteristics:

● Versus biomass to liquids plants, waste to biofuels plants benefit from getting

paid to safely dispose of waste instead of paying to procure biomass. This

operating cost difference can be as much as one dollar per gallon of biofuel

● Waste to biofuels plants do not consume food based feedstocks, a major

criticism of existing corn based ethanol plants

● Waste to biofuels plants can be located close to markets that consume liquid

fuels which reduces the amount of transportation required for the fuels

● Producing liquid fuels from waste results in fewer emissions than when waste

is incinerated

Westinghouse Plasma Corp.

The Westinghouse Plasma Demonstration Center was upgraded in 2009 to have the capability to provide clean syngas for its customers and potential customers. The Plasma Center has tested multiple feedstocks including household, commercial, industrial waste as well as many types of biomass. It provides Westinghouse Plasma with a strong competitive advantage as our customers are able to optimize design parameters, simulate commercial conditions, and assess viability of certain feedstocks.

Converting waste into biofuels solves two major problems; avoiding landfills which create problems for future generations and reducing the dependence on depleting oil supplies. Plasma gasification offers the scope for increased efficiency in releasing the embedded chemical energy within residual wastes and hence competitive advantages over conventional solutions like incineration. Westinghouse Plasma believes that waste-to-liquids is a major growth area and are currently working with leading biofuel technology providers to jointly model and understand this market. As the industry leading plasma gasification company, Westinghouse Plasma is well positioned in this space.

ISSUE | JUNE 20128

Key Stakeholders

The testing has been essential to the project engineering team as we refine the

commercial plant design, to gain operational efficiencies and reduce the overall

capital of over 200 million liters per year waste-to-ethanol facility.

Success Story: Flex Ethanol, Australia Flex Ethanol Australia is developing a project in Melbourne, Australia where it plans

on converting municipal solid waste, tires and sewage sludge into more than 200

million liters of ethanol a year, using the Westinghouse Plasma technology.

Taking the necessary steps to bring the Flex Ethanol Australia Project to life includes

conducting a comprehensive test at the Westinghouse Plasma Demonstration

Center and Coskata’s co-located semi-commercial facility of the suitability of

Australian-specific household waste for ethanol production. Testing was recently

carried out at the Plasma Center with successful results.

About Flex Ethanol AustraliaGM Holden, Caltex and Phoenix Energy (Alter NRG licensee in Australia) are

partnering on the project.

Flex Ethanol Australia is a new company that has been formed to prepare for

commercial production of ethanol from household waste for use in Australian cars.

The facility will ultimately be capable of turning up to one million tonnes of

household rubbish and building waste into more than 200 million liters of ethanol

each year.

One of Flex Ethanol Australia’s first steps in project development is a test at the

Westinghouse Plasma Demonstration Center to determine the suitability of

Australian household waste for ethanol production.

About GM Holden: The history of Holden dates back to 1856. Today Holden is one of only seven fully-integrated global General Motors operations that designs, builds and sells vehicles for Australia and the world. Holden has its headquarters in Port Melbourne, with an engine manufacturing plant on-site and vehicle manufacturing operations in Adelaide South Australia and is represented by more than 300 dealerships. GM Holden’s reported revenue in 2010 was A$4.4 billion.

About Caltex: Caltex is Australia’s leading transport fuel supplier and convenience retailer and the only integrated oil refining and marketing company listed on the Australian Securities Exchange. They operate in every state and territory in Australia. As a supplier Caltex buys crude oil and refined products on the international market. Caltex is also Australia’s leading oil refiner. Combined production at Caltex’s Kurnell refinery in Sydney and Lytton refinery in Brisbane comprises approximately 50 percent petrol, 30 percent diesel and 15 percent jet fuel. The remainder of the production consists of fuel oil, waxes and lubricants, bitumen, sulphur, LPG and other gasses. Caltex reported A$18.7B in revenue in 2010.


W15: Process Design Package (PDP)The purpose of a Process Design Package (PDP) is to supply customers with the

Front-End Engineering and Design requirements for the Alter NRG scope of

supply. The PDP will be used by Alter NRG to form the detailed estimate for the

Alter NRG’s supplied equipment.

W-15 Product Portfolio for Project Optimization

● Alter NRG Plasma Gasifier (APG) reactor including refractory lining and shell

jacket cooling

● Refractory lined duct work from the outlet of the gasifier reactor to the inlet of

the venturi cooler

● Plasma torch systems including torch cooling (deionized water cooling

system), plasma torch tuyere cooling, torch air control, and shroud air

● Oxidant control system

● Partial quench system

● Slag handling system

The Alter NRG Plasma Gasification System (APGS), using Westinghouse Plasma Corporation (WPC)

technology, is designed to handle MSW with the following functional systems for the project:

W 15 ● Replaces up to 150,000 bbls/

yr of fossil fuel

● Handles up to 300 tpd Waste

● Replaces up to 15 MW

Electrical

Engineering Services ● Feasibility Study

● Design Basis Memorandum (DBM)

● Process Design Package (PDP)

Scope of Supply ● Feed System

● Plasma Gasification Reactor

● Plasma Torch Systems

● Slag Solidification System

● Syngas Cleaning Systems

ISSUE | JUNE 201210

GASIFIER ModEl AppRoxIMAtE cApAcIty (tonnES/dAy)

Feedstock Oxygen Air

W 15Waste 290 140

Hazardous Waste 160 300

The W-15 Gasifier

is ideal for smaller

projects. This is a

fully engineered

solution with 3D

Models [pictures

to the left and

bottom], material

off-takes and full

Process Design

Packages (PDP)

available.


The Westinghouse Plasma Gasification technology is capable of processing a

variety of waste materials to generate a commodity grade syngas. Syngas is a

versatile product that can be used to replace fossil fuels and generate power.

The value proposition is simple and compelling

Refueling Configuration with Westinghouse Plasma Gasification

● Create energy independence

● Create an environmentally sustainable in-country waste management solution

● Reduce reliance on expensive and volatile fossil fuel imports

● Improve the CO2 footprint of power generation facilities by reducing the amount of fuel oil

● Use existing infrastructure without major capital cost upgrades

● Many islands and other areas of the world do not have natural

gas and so they import fuel oil to create their electricity. With

oil prices of $100 per barrel, plus delivery it can routinely cost

$20 per MMbtu

● People pay to dispose of waste (tipping fees). The

Westinghouse Plasma Technology at a $60 tipping fee for the

household waste creates syngas that can be used to replace

the fuel oil and at a cost of $0 per MMbtu. This is a significant

economic improvement. This is in addition to the benefits of

removing waste from landfills, as well as significantly lower

carbon dioxide emissions. A win, win, win proposition

● Alter NRG is currently in commercial discussions for various

projects around the world both with the island nations

themselves, as well as engineering companies interested in

partnering into this opportunity

Existing configuration Refueling configuration

BOILER

MODIFIEDBOILER

FUEL OIL FUEL OIL

STEAM

SYNGAS

STEAM

FEED STOCK

Hazardous

Tires

Municipal

Industrial

Biomass

etc.

Westinghouse Plasma Corp. provides a complete design bui ld solut ion for the fuel replacement market. Our project scope is designed to minimize execut ion r isk and provide the best possible solut ions and service for our customers, including detai led faci l i ty engineering to the start-up and commissioning of your faci l i ty.

WESTINGHOUSE PLASMA’S FUEL REPLACEMENT SOLUTIONIn the refueling configuration, the Westinghouse Plasma Gasifier will process waste materials and create a commodity grade clean syngas. This syngas is then co-fired in the existing boiler through a modification of the boiler system. The syngas will likely represent less than 25% of the total fuel being delivered to the power station. By controlling the amount of syngas as a percentage of the total delivered fuel, the facility

will benefit from the significant economic and environmental attributes of the syngas while maintaining the original performance of the boiler. Refueling has many advantages, including:

Refueling

ISSUE | JUNE 201212

150,000 - 650,000+ bbl of Low Cost Replacement Fuel per annum

Limited land availability and as current landfills are mandated for closure, Westinghouse Plasma provides sustainable “Made in Country” waste management solution and economic advantages.

Significant reduction in fuel costs ● Westinghouse Plasma Solution can replace a material percentage of the fuel oil being used to generate power, resulting in significant fuel savings and a lower total plant operating cost.

Effective utilization of current power plant assets ● Fuel replacement integrates with an existing power generation facility which greatly reduces the project cost when compared to a greenfield project.

● Integration with an existing power plant reduces permitting issues when compared to a greenfield project.

Provides energy independence ● Creating syngas from local waste materials, creates a “Made in Country” energy solution and reduces the reliance on fossil fuel imports that can be volatile and expensive.

● Creating syngas on site reduces the need for pipeline infrastructure that can be environmentally disruptive and capital intensive.

Westinghouse Plasma refueling strategy ● Create a “Made in Country” solution for waste streams that are currently land-filled or shipped overseas.

● Reduce greenhouse gas emissions and the contamination of soil and ground water caused from land-filling.

● Indirectly increase recycling rates – US States with high rates of Waste to Energy tend to also lead the country in recycling.

● Provide waste management solutions in the areas of high population density where sustainable waste disposal is critical.

250 - 1,000 tonnes per day of waste

Solution for Island Countries - The Caribbean


Project UpdateAlter NRG supported the final engineering for Wuhan Kaidi who continued

construction of a demonstration facility in China. Upon successful

demonstration (expected in Q3 of 2012), Kaidi has more than 100 sites

identified to take biomass and convert it into power and ethanol.

Alter NRG also supported a demonstration facility in Shanghai China, for which the detailed engineering and torches have been delivered. The facility has finalized its feedstock agreement, with a large Chinese waste company and its site location and they are advancing the site plan.

Wuhan Kaidi Demonstration Plant currently being built in China, alongside an existing facility

ISSUE | JUNE 201214

Westinghouse Plasma showcased the Waste

to Biofuels Conversion Technology

Westinghouse Plasma attended the 7th

Annual World Biofuels Markets

Conference held in Rotterdam,

Netherlands from March 13-15, 2012.

This is the largest biofuels congress and

exhibition event in Europe.

Kevin Willerton

stated that “I really enjoyed the

conference. It was

good value for my

company.”


www.alternrg.com

Alter NRG provides clean energy

solutions that are economically viable

and environmentally sustainable.

Westinghouse Plasma is the industry

leading plasma gasification

technology that provides clean and

renewable energy solutions by

converting all types of waste and

biomass into high value energy - like

electricity, ethanol or syngas. With

plasma systems in operation for 20

years and converting waste into

energy since 2002, the technology is

commercially proven and produces

lower emissions than other

conventional energy technologies.

Documents

NRG Focus - June 2012 Issue