" "anticipates," "intends," "plans," "believes," "seeks," or "will." Forward-looking
statements by their nature address matters that are, to different degrees, uncertain. For us, particular uncertainties which could adversely or positively affect our future
results include: the behavior of financial markets, including fluctuations in interest rates and commodity prices; strategic actions, including dispositions; future integration
of acquired businesses; future financial performance of major industries which we serve, including, without limitation, the air and rail transportation, energy generation,
media, real estate and healthcare industries; unanticipated loss development in our insurance businesses; and numerous other matters of national, regional and global
scale, including those of a political, economic, business, competitive and regulatory nature. These uncertainties may cause our actual future results to be materially
different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements. 2
Global Trends
Population
Energy Security
Environment
Consumption
Create Big Challenges 3
And the Challenges
Drive the Technology High fuel prices
require
higher efficiency Energy security
requires
more diverse solutions More stringent environmental
standards require
lower
emissions, increased use of
renewables and nuclear 4
Around the World
Diversity is Key
Europe
Gas and oil prices up 2X over two years
Import dependency forecast to rise to 70% by 2030
China 2X increase in installed capacity by 2010
30%+ of worlds additions
India Government committed power to all by 2009
Overall
Environmental/security concerns everywhere
Forward fuel costs high and volatile
Core industry investments following low fuel costs 5
Power Gen Landscape Next 10 Years
Source: GE Energy PG Marketing
N. America
China
RO Asia
India
W. Europe
Middle East / Africa
Latin America
E. Europe & FSU
Total Capacity Additions GW (2006 2015)
Nuclear
Renewables
Hydro
Coal
Gas/Oil
TOTAL
8
21
24
35
59
146
10 Year Avg Annual
Cap Adds (GW) 6
Growing Demand for Renewables
Source: REN21, Renewables 2005 Global Status Report, EER2006, BTM 2005 Marketbuzz-06 & PGV Analysis. Excludes large hydro
2005 Renewable Installed Capacity
Small Hydro
Geothermal
Biopower
Solar
Wind
7%
3%
3%
81%
23%
World
Americas
Europe
India
China
Asia
MEA
179
37
72
20
32
15
2
GW
Installed Capacity
Growth (04 05)
Renewable technology only 3% of electricity production today
Strong historical and projected growth ~25% CAGR (95 13) 7
Coal Is Still A Primary Energy Source
Source: EIA
Recoverable Coal Reserves (Million Short Tons)
0.5
21.9
55.5
279.5
316.3
327.2
China
126.2
India
101.9
Middle
East
S & Central
America
Africa
North
America
Europe &
Eurasia
Asia
Pacific 8
Affordable, Reliable & Environmentally Responsible
Meeting Big Challenges with Big Solutions
Driving Cost of Electricity Down
Efficiency
Reliability
Emissions
Efficient
Diverse
Nuclear
Coal
Gas
Wind
Oil
Geothermal
Biomass
Hydro
Solar
Nuclear
Coal
Gas
Wind
Oil
Geothermal
Biomass
Hydro
Solar
+ 9
Technology Diversity is Critical
Capital
O&M
Fuel
Cost for New Build COE (cents/kWh)
Nuclear
Wind *
Coal
6.8
Gas
6.6
4.2
* Includes U.S. Production Tax Credits
6.2 10
6.8
4.2
Technology Diversity is Critical
Capital
O&M
Fuel
Cost for New Build COE (cents/kWh)
Wind *
6.2
Coal
Gas
6.6
Nuclear
6.8
ESBWR
3.6 MW
LMS
H System
TM
FB
IGCC
Proprietary GE Solutions
* Includes U.S. Production Tax Credits 11
Increasing Investment
165+
20
+10X
76
2
06
98
Products
New Product Launches
98
06
98
New Product Investment
+3X
Services
Controls
Materials
Combustion
Aerodynamics 12
Leading Technology Across the Portfolio
Gas
Network
Reliability
Environmental
Services
Cleaner Coal
Nuclear
Wind
Hydro
Asset
Optimization
Biomass
Solar 13
Meeting Big Challenges with Big Solutions
Sources: EIA: International Energy Outlook 2005, BP Statistical Review of the World 2005
Worlds most abundant resource
Global recoverable reserves oil 40 yrs, natural gas 65 yrs, coal 165 yrs
Improving economics IGCC cost of electricity at parity with pulverized coal
Responding to need to balance economic growth and environment
Coal Outlook
0
20
40
60
98
02
06
10
14
US Coal
GW
Global Coal
NOx
~33%
SOx
~75%
Particulates ~50%
Environmental Impact
Reduction vs Pulverized Coal
Achieve 90% mercury removal
at a fraction of the cost
Cleaner Coal 14
Gasifier
Radiant
Syngas
Cooler
Particulate
Removal
Mercury
Removal
Sulfur Removal
Future CO
2
Capture
Gas Turbine
Electricity
Transmission & Distribution
Steam Turbine
HRSG
Leading Technology in Cleaner Coal IGCC
Focused on energy security, CAPEX and emissions
Converts coal to synthesis gas cleaned prior to burning
Produces useful byproducts
Driving down cost and emissions
CAPEX approaching pulverized coal (pc)
Emissions approaching natural gas
GE Content
IGCC
PC
vs.
5%
40% 15
Leading Technology in Nuclear ESBWR
Reduced CAPEX and OPEX, shorter construction schedule
Part of US DOE 2010 Program, design certification submitted to NRC,
selected by NuStart, Entergy & Dominion
On plan for 2007 Combined Operation License applications
Simplified design, increased output, smaller footprint
Improved safety
& security
Modular &
passive design 16
Leading Technology in Gas LMS100
®
GE advantage turbine core
from Aviation technologies
Booster and Power Turbine from Energy
Highest simple cycle efficiency 46%
10 minute start to 100 MW
Load test complete >104 MW to date
6 units on order +14 commitments
received through 08
First unit in commercial operation,
06 Basin Electric
Today
Worlds most efficient simple cycle gas turbine 17
Leading Technology in Gas H System Execution
Baglan Bay, UK
Only OEM demonstrating rotational
steam cooling
480 MW, 13ppm NOx
14,000+ fired hours, 6.2MM+ MW hours
TEPCO, Tokyo Japan
3 x 109H 1,520 MW shipping 06-08
Inland Empire, California
2 unit 7H launch commercial 2008
The Future
Performance growth platform
Maintains technology leadership
Worlds most advanced combined cycle technology 18
Leading Technology in Renewables Biomass
'02
'20
US
Europe
Asia + ROW
3.5
16
Global
Installed
capacity
(GW)
Bio Power Growth
Converting waste into energy
Efficiency, Reliability & Fuel Flexibility
1.2 GW total GE installed base biomass
1,450 units delivered for use of biogas, landfill gas,
and sewage gas
480+ engines shipping in 2006 up 54%
Patented combustion technology CO
2
neutral 19
Leading Technology in Renewables Wind
Arklow demonstration
project 7 x 3.6s
Largest commercial
operation
1.5 MW Platform
Full power conversion
Simplified servicing
Larger farms with
easier grid integration
Future: 3 MW
Permanent magnet
generator
Advanced controls
Future: 5 - 7 MW
Leading cost of energy
Utilizing GE technology
strengths
Among the most proven
and utilized technology
Over 4,100 units
worldwide
97%+ availability
Multi-Megawatt
3.6 MW Offshore
Cleaner energy solution, low-cost energy source 20
Energy Growth Drivers
Installed base diverse
technologies strong position
and growing
Services $1B+ revenue new
products, platforms and regions
Wind US demand
Aeroderivatives and gas engines
new product introductions,
service and price realization
Simplification & cost out
($B)
05
06
Big Challenges Bring Big Opportunities
for Growth
04
Revenue
Op Profit $2.5
$15
$17
$2.7
~10%+
~10%+ GE
Meeting
Energy
Big
Challenges
John Krenicki
President and CEO