Predictable, Stable and Sustainable Cash Distributions from Long Term Contracts

The host steel mills and the Projects enjoy a mutually beneficial relationship. The Projects provide their industrial customers with a combination of thermal and electric energy, environmental services, and in the case of the Harbor Coal Project, coal pulverization services, all on competitive terms. Primary Energy enables its customers to focus their capital investment on their core operations. Because of these factors, management believes that it will continue to enjoy relationships with each of the customers throughout the duration of the Projects’ existing contracts and beyond.

Primary Energy has minimal exposure to fluctuations in fuel prices. Three of the Projects obtain their primary fuel from their hosts’ waste thermal energy streams; accordingly, there is no fuel price risk associated with this fuel source. The Portside Project converts natural gas purchased by its host into electricity and thermal energy.

Projects are Located at High Quality Mills

The Mittal and U.S. Steel mills at which the Projects are located, and which represent the suppliers and customers for the operations of the Projects, are important components of their respective parent companies, produce low cost, high quality steel and have close relationships with major steel customers.

Substantial Economic and Environmental Benefits Accrue to Hosts

The Recycled Energy Projects are critical to the operation of their hosts and provide significant benefits including supplying cost efficient, reliable energy streams required for their operations. Since the Recycled Energy Projects primarily utilize waste energy from their hosts at zero cost, they produce energy at a cost well below the marginal price of energy from other sources and generate significant cost savings for their hosts and protect their hosts from volatile commodity prices.

The services provided by the Recycled Energy Projects also result in environmental benefits, for which the hosts enjoy significant recognition. Three of the Recycled Energy Projects capture waste energy from industrial processes and convert it into useable forms of electricity and thermal energy, resulting in a more efficient use of the original fuel inputs. The Portside Project uses natural gas as fuel and captures its own waste energy and converts it into additional electricity and thermal energy, resulting in additional fuel efficiency. The Cokenergy Project provides additional environmental benefits through the removal of sulfur dioxide and particulate matter from the exhaust gas of an adjacent coke production facility and is the first non-recovery coke making process with integrated electric, steam and flue gas cleanup.

The added efficiency and environmental benefits of the Recycled Energy Projects have been recognized in the form of awards from a variety of sources. Specifically, the USEPA and the U.S. Department of Energy awarded the Portside Project its ENERGY STAR(R) Combined Heat and Power award. The Portside and Northlake Projects have both received the Governor of Indiana’s award for Excellence in Pollution Prevention.

Projects Utilize Reliable, Proven Technology

The Projects utilize reliable and proven technology from recognized equipment providers to deliver energy services to their hosts. The Ironside, North Lake and Cokenergy Projects use steam driven turbine technology that has been in use in the electricity generation industry for over 100 years. Given the durability of steam turbine technology and the free waste fuel sources, Management believes these Projects have the ability to operate profitably well beyond their existing contracts. The Portside Project’s natural gas turbine is a conventional GE 6B that is in wide use throughout North America. To produce pulverized coal, the Harbor Coal Project utilizes two coal pulverizers that are common in the steel and coal power industries and have historically operated without significant issues. As a result of their straightforward technology and management’s operating experience, the Recycled Energy Projects have demonstrated a strong reliability track record, having averaged 94% Availability over the past five years.

Substantial Opportunities to Grow Distributable Cash

The Manager has granted Primary Energy a right of first offer on projects wholly-owned by the Manager. [See Growth Strategies]