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company presentation 1 August 2016 Introduction innogys management board Uwe Tigges Peter Terium Bernhard Gnther CHO & Labour Director Chief Executive Officer Chief Financial Officer Hildegard Mller Martin Herrmann Hans

  1. Key investment highlights Our investment plan builds on measured steps 4 Create options for the future > Develop new business models > Enable innovation Capture new business opportunities > Enter new markets and new technologies > Grow in adjacent business areas Lever core competencies • Expand and upgrade existing asset base Lever core competencies • Focus on efficiencies and operational improvements > Expand and upgrade existing asset base > Focus on efficiencies and operational improvements innogy · company presentation · 1 August 2016 page 16

  2. Key investment highlights Building on our core competencies creates compelling 4 mid-term prospects market development innogy focus Green investments Grid & Support the integration of renewable energy sources Infrastructure Smart investments Germany Manage the costs of the energy transition East Growth in selected markets Efficiency improvements Operational excellence UK turnaround Retail Customer focus Germany Capture the increased strategic value of customers Netherlands/Belgium United Kingdom Energy+ East Proactively manage emerging customer needs Market entry in adjacent markets Execute current pipeline Renewables Market opportunities Benefit from continued support for renewable energy sources Expansion opportunities Growth in new markets and new technologies innogy · company presentation · 1 August 2016 page 17

  3. Key investment highlights How innogy drives innovation of the future energy 4 system within its Innovation Hub innogy Innovation Hub Insights Ideation Build and pilot Handover Operational business/ corporate start-up Defining focus topics POC 1 POC 1 Decision point 1 Decision point 2 Berlin/Essen Israel Strategic partnering USA 1 Proof of concept. innogy · company presentation · 1 August 2016 page 18

  4. Key investment highlights Two innovative business models – optimising production 4 processes and energy management application PERSONAL ENERGY ADVICE Idea Phase: pilot Phase: pilot challenge SMEs 1 in the production sector have a lack of Retail customers expect ever more assistance Sector from their energy supplier in helping to transparency in their production units and no knowledge how to increase performance understand, control and reduce their energy usage Retrofit sensors in combination with an Real-time and appliance level energy insights, approach innogy‘s analysis web tool generate real time provided to retail customers through their innogy information about production processes and company’s app, powered by a common data and energy usage on machine level analytics platform SMEs are able to minimise energy costs and Reduced energy expenditure and greater Customer value identify breakdown risks as well as increase sense of control. Higher customer machine utilisation. consenze enables engagement and trust, more willingness to customers to improve decision making stay, buy and recommend its supplier 1 Small and medium-sized enterprises. innogy · company presentation · 1 August 2016 page 19

  5. Key investment highlights Our key investment principles to safeguard 5 shareholder value Majority of capex into regulated business Focus on growth opportunities in core markets Prudent capital Strict investment framework with allocation conservative hurdle rates and investment profile Flexible capital allocation approach: competing projects across segments Management highly incentivised for value creation innogy · company presentation · 1 August 2016 page 20

  6. Key investment highlights Focus on attractive shareholder returns 5  Attractive dividend policy based on pay-out ratio of 70-80% of adjusted net income 1  Pay-out ratio supported by strong operating cash flows and backed by solid financial structure  Dividend policy compatible with innogy‘s target of an investment grade rating  Anticipated payment of full dividend for fiscal year 2016  Management incentive scheme with clear focus on total shareholder return 70-80% dividend pay-out ratio 2 1 Adjusted net income generally excludes one-off effects, including the entire non-operating result as well as associated tax effects. 2 Based on adjusted net income. innogy · company presentation · 1 August 2016 page 21

  7. Key investment highlights Management incentives build on proven 5 RWE scheme – adaption to new business environment innogy management incentive scheme well balanced with a clear focus on total shareholder return 1 > Based on the economic development of the company, individual and collective Individual performance as well as performance with regards to corporate responsibility and annual employee motivation bonus scheme > Aims to reward the achievement of long-term strategic objectives while facilitating the capital market orientation Long-term > Conditional right to receive a pay-out in cash following a period of four years incentive > Pay-out dependent on achievement of performance targets derived from the plan strategic planning and set before the first tranche start (‘3-year IPO business plan’) and based on the share price development as well as the accumulated dividends paid to shareholders (total shareholder return) 1 Further details subject to supervisory board approval of RWE International SE (in future: innogy SE). innogy · company presentation · 1 August 2016 page 22

  8. Key investment highlights Corporate governance – innogy with high degree of independence reflected in its supervisory board structure Envisaged composition and staffing process Envisaged supervisory board structure > Two-tier board structure – 20 members, thereof > Target composition 10 shareholder and 10 employee representatives • RWE AG represented by one management board member, designated CFO Markus Krebber • Werner Brandt and Frank Bsirske in personal union as supervisory board chairman and supervisory board deputy chairman for RWE AG and innogy > Audit committee to be formed mainly from independent board members > Envisaged three-step approach for filling and confirming supervisory board seats • 1 July 2016: three headed supervisory board in place 1 September 2016: 20 members supervisory board • • Spring 2017: confirmation of 10 shareholder representatives by annual general meeting innogy · company presentation · 1 August 2016 page 23

  9. Key investment highlights Corporate governance – ‘agreement on basic principles’ sets clear and stable rules going forward Key principles governing innogy/RWE relationship Selected features on ‘agreement on basic principles’ between innogy and RWE Both parties – RWE AG and innogy – shall be in the > > Non-compete clause states that RWE is largely position to pursue their strategic, operational and restrained from competing in innogy’s core financial targets individually and independent from businesses until 31 December 2019 each other > RWE will manage innogy as a financial investment > Shortly prior to the IPO the domination agreement RWE AG will not impose strategic and financial • between innogy and RWE will be terminated targets and is not involved in planning and > All intercompany relations and agreements to be management incentive discussions carried out at arm’s length • Investment decisions at innogy will not be subject to approval by RWE AG innogy · company presentation · 1 August 2016 page 24

  10. Key investment highlights innogy’s key characteristics – large and stable business with attractive growth prospects +9% increase Unique European asset base 1 23m 3.6GW €13.3bn anchored in Germany, leading expected for total RAB 1 customers renewables capacity 2 positions across many countries German RAB 1 Stable business well invested to yield 2 ~60% largely regulated and predictable share of regulated 3 EBITDA returns Resilient financial profile backed by ~70% >[95]% ~4.0x Strong Development of 3 strong cash generation and solid SAIDI / SAIFI rates target leverage CFOA 4 /EBITDA Efficiency factor Among DSOs in Eastern Markets 3 capital structure (average 2013-15) in Germany net debt/EBITDA Solid platform for growth driven by 4 Set for ~€6.5bn capex 5 Focus on further operational excellence supported by mid-term growth efficiencies (2016-18E) IPO proceeds 70-80% 5 Focus on value creation Strict capital discipline dividend pay-out ratio based on adjusted net income 1 Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. 2 As of 31 December 2015; accounting view; includes 3.3GW from Renewables segment (excluding Zephyr portfolio) and 0.3GW renewables capacity from participations related to the Grid & Infrastructure segment. 3 Includes regulated and quasi-regulated business activities. 4 Cash flow from operating activities after interest and tax. 5 Including financial investments. innogy · company presentation · 1 August 2016 page 25

  11. Financials

  12. Financials Creating value for innogy shareholders – based on stable earnings and a strong financial profile A stable and attractive …translates into strong cash generation …creating earnings profile… and a solid capital structure… shareholder value By division 1 CFOA/EBITDA Attractive dividend policy Renewables 17% 70-80% ~70% of adjusted Retail Grid & avg. 2013-15 net income 21% Infrastructure payout ratio 61% 2015 EBITDA €4.5bn By regulated share Target leverage Prudent growth Regulated ~4.0x Strict share 2 net debt/ investment ~60% EBITDA criteria 1 Segment breakdown based on sum of operating segment results (€4.7bn). Total includes €(0.2)bn presented as ‘Other, consolidation’ in the combined financial statements. Numbers might not add up due to rounding differences. 2 Includes regulated and quasi-regulated business activities. innogy · company presentation · 1 August 2016 page 27

  13. Financials Historical financials reflective of the current scope of innogy, set-up of target capitalisation ongoing > Audited IFRS combined financial statements for the years 2013, 2014 and 2015 General > Consolidated financials as of H1 2016 for innogy Group currently being prepared structure > 2013-15 innogy Group effectively presented as sum of RWE’s three segments Grids/Participations/Other, Supply and Renewables Scope of • Only few carve-out transactions where assets remained with RWE (e.g. Mátra and Markinch) companies Businesses sold during 2013-15 (e.g. NET4GAS) 1 not included in scope • > 2015 balance sheet not representative of innogy’s capitalisation going forward > Capitalisation as per H1 2016 will be reflective of all relevant intercompany transactions (purchase price payments related to formation of innogy) Capital > Further changes to capitalisation resulting from structure Cash capital contribution of €0.9bn and debt/equity swap of €1.0bn executed in July 2016 • • ~ 10% 2 primary capital increase at IPO > One-offs and non-recurring effects in innogy financials affecting comparability of historic Other performance 1 An exception applies to companies that are part of the business of innogy, e.g. shares in windfarms that were sold by RWE Innogy, or the sale of certain entities with the simultaneous signing of a long-term supply contract that just resulted in a change of the sales channel during the reporting periods of the combined financial statements. These entities are included in the combined financial statements until their respective sale. 2 Post money. innogy · company presentation · 1 August 2016 page 28

  14. Financials innogy is infrastructure-like with roughly 60% regulated 1 earnings driven by stable grid business Grid & Infrastructure EBITDA (€bn) Retail EBITDA (€bn) Renewables EBITDA (€bn) Capex intensity Ø 2013-15 2 Share of regulated EBITDA 2015¹ Share of quasi-regulated >80% ~20% ~60% EBITDA 2015 3 2.9 2.9 2.8 Retail EBITDA excl. UK 0.7 0.8 1.1 2.0 2.0 2.2 1.1 1.0 1.1 0.8 0.4 0.3 0.2 0.5 0.2 0.4 0.2 0.2 0.9 0.2 0.8 0.3 0.6 0.6 0.4 0.3 (0.1) 2013 2014 2015 2013 2014 2015 2013 2014 2015 2013 2013 2014 2014 2015 2015 2013 2014 2015 G&I East G&I Germany Germany NL/BE East UK Note: numbers may not add up due to rounding differences. 1 Includes regulated and quasi-regulated business activities. 2 Capex intensity defined as capex/EBITDA. Capex excluding financial investments. 3 Includes long-term contracts. innogy · company presentation · 1 August 2016 page 29

  15. Financials Grid & Infrastructure Germany – stable regulatory returns and operational excellence Grid & Infrastructure Germany Comments EBITDA development € million 2013 2014 2015 > Decrease in 2015 primarily driven by lower earnings from disposal of grid assets (€187m in 2014 to €153m in 2015), EBITDA 1,999 2,222 2,016 the sale of LEW high voltage grid to Amprion resulting in t/o operating income from book gains during 2014 and higher grid maintenance costs as 254 251 233 investments 1 well as restructuring costs related to early retirement scheme Operating D&A (668) (769) (734) > Increase in 2014 due to grid disposals (from €63m in 2013 to €187m in 2014), above mentioned sale and effects from the Operating result 1,331 1,453 1,282 efficiency enhancements launched in 2012 > D&A includes impairment charges on gas storage assets of €101m in 2014 and further impairments in 2015 Capex 2 841 856 968 Capex > Strong increase in 2015 driven by higher grid infrastructure Capex/operating D&A 1.3 x 1.1 x 1.3 x optimisation investments EBITDA – capex 1,158 1,366 1,048 > Capex continuously above D&A in all years supporting RAB growth 1 Income from not fully consolidated participations. 2 Excluding financial investments. innogy · company presentation · 1 August 2016 page 30

  16. Financials Grid & Infrastructure East – continuous efficiency enhancement reflected in operating results Grid & Infrastructure East Comments EBITDA development € million 2013 2014 2015 > Increase in 2015 mainly driven by the revaluation gain of €143m from the first-time consolidation of VSE in Slovakia, EBITDA 791 639 862 improved regulatory conditions for the Czech gas distribution t/o operating income from grid leading to increased WACC, higher gas volumes from 45 50 61 investments 1 favorable weather conditions – partly offset by decreased gas storage margins Operating D&A (184) (188) (214) > Decrease in 2014 mainly driven by reduction in gas volumes as a consequence of milder weather, which also impacted Operating result 607 451 648 gas storage margins due to decreased seasonal spread > D&A increased in 2015 as a result of the first-time consolidation of VSE Capex 2 276 275 337 Capex > Increase in 2015 primarily resulting from the first-time full Capex/operating D&A 1.5 x 1.5 x 1.6 x consolidation of VSE and increased investments in Hungarian grid to meet the minimum regulatory requirements following EBITDA – capex 515 364 525 capex cuts in previous years > Capex significantly above D&A in all years supporting RAB growth 1 Income from not fully consolidated participations. 2 Excluding financial investments. innogy · company presentation · 1 August 2016 page 31

  17. Financials Retail Germany – innogy’s largest retail segment profiting from leading market position Retail Germany Comments EBITDA development € million 2013 2014 2015 > Strong increase in 2015 driven by release of provisions, mainly related to legal risks in connection with customer EBITDA 279 394 583 supply contracts which were mitigated in 2015 (€81m). In addition, positive effects from efficiency enhancement Operating D&A (24) (36) (38) programme, a larger customer base and higher gas sales > 2013 negatively affected by €142m realised losses in our Operating result 255 358 545 hedge book due to unfavourable wholesale price developments Capex¹ 29 46 53 > Adjusted for those effects, results were stable in 2013 and 2014 Capex intensity 10% 12% 9% (Capex/EBITDA) > D&A increase in 2014 and 2015 due to depreciation of biomass activities transferred from Renewables to Retail EBITDA – Capex 250 348 530 in 2014 Capex > Low capex intensity > Capex in 2014 and 2015 impacted by energy+ business, mainly higher investments in CHP generation units 1 Excluding financial investments. innogy · company presentation · 1 August 2016 page 32

  18. Financials Retail NL/BE – strong position in stable Dutch and Belgian market Retail NL/BE Comments EBITDA development € million 2013 2014 2015 > Increase in 2015 mainly due to recovery from weather- affected results in 2014 and marketing of new supply EBITDA 257 191 236 offerings > Decrease in 2014 due to mild weather and competitive price Operating D&A (59) (53) (42) pressures. Negative effects partly offset by new supply offerings and efficiency improvements Operating result 198 138 194 > From 2015, weather induced effects largely hedged > D&A decrease in 2015 due to phasing-out of allocated Capex¹ 14 9 25 acquisition costs for our subsidiary in NL and decreased Capex intensity depreciation related to IT systems 5% 5% 11% (Capex/EBITDA) Capex EBITDA – capex 243 182 211 > Low capex intensity 1 Excluding financial investments. innogy · company presentation · 1 August 2016 page 33

  19. Financials Retail East – stable earnings contribution in growing Eastern European markets Retail East Comments EBITDA development € million 2013 2014 2015 > Increase in 2015 mainly driven by revaluation gain of €42m from first-time full consolidation of VSE EBITDA 211 190 234 > Slight decrease in 2014 driven by milder weather and Operating D&A (23) (6) (6) increased competition > D&A decreased in 2014 due to several smaller impairments Operating result 188 184 228 in Czech Republic in 2013 Capex Capex¹ 9 9 20 > Low capex intensity Capex intensity 4% 5% 9% (Capex/EBITDA) EBITDA – capex 202 181 214 1 Excluding financial investments. innogy · company presentation · 1 August 2016 page 34

  20. Financials Retail UK – burdened by operational issues; recovery well on track Retail UK Comments EBITDA development € million 2013 2014 2015 > Decrease in 2015 mainly driven by severe process- and system-related issues in the billing of household customers. EBITDA 366 294 (65) In addition, we were facing regulatory investigations. Overall negative one-off effects from the billing and regulatory issues Operating D&A (76) (67) (72) amounted to €119m 2 . Additionally, increasing competitive pressure leading to higher churn rates and margin pressure Operating result 290 227 (137) > Decrease in 2014 mainly driven by initial repair and workaround measures in relation to our IT system, but also Capex¹ 106 148 189 mild weather, customer losses and the sale of Telecom Plus portfolio partly offset by release of provisions Capex intensity 29% 50% nm > 2013 was affected by one-off gain from sale of Telecom Plus (Capex/EBITDA) Capex EBITDA – capex 260 146 (254) > Structurally different capex profile from other countries due to the requirement for investments in IT infrastructure > Increase in 2014 and 2015 due to non-recurring investments in the IT and smart meter infrastructure in the UK 1 Excluding financial investments. 2 Includes (i) net effects of EUR 60 million related to charges concerning erroneous and late invoicing, the build-up of provisions for regulatory charges and reviews and the release of provisions for customer paybacks and (ii) net effects of EUR 59 million related to billing issues due to changes in revenue estimation. innogy · company presentation · 1 August 2016 page 35

  21. Financials Renewables – strong recent growth track record Renewables Comments EBITDA development € million 2013 2014 2015 > 2015 increase driven by the commissioning of offshore wind farms Nordsee Ost and Gwynt y Môr as well as higher EBITDA 448 524 818 volumes and increased utilisation levels of existing capacities t/o operating income from > 2015 result also affected by one-off effects from gains from (44) (3) 102 investments the sale of a 75% stake in Galloper (€93m), the Gwynt y Môr network infrastructure (€30m) and other assets (€9m) Operating D&A (248) (271) (330) > Increase in 2014 due to positive effects from compensation payments for delays to the completion of Nordsee Ost. This Operating result 200 253 488 was offset by drastic cuts made by the Spanish government to renewable energy subsidies granted, decreasing power Capex¹ 975 677 404 prices and lower volumes from existing assets > Higher D&A in 2015 resulting from increase in overall asset Capex/operating D&A 3.9x 2.5x 1.2x base due to the commissioning of Nordsee Ost and Gwynt y Môr EBITDA – capex (527) (153) 414 Capex > Significant decrease from 2013 to 2015 mainly driven by the completion of Nordsee Ost and Gwynt y Môr 1 Excluding financial investments. innogy · company presentation · 1 August 2016 page 36

  22. Financials P&L summary (1/2) – strong and steadily increasing EBITDA innogy Group Comments EBITDA development € million 2013 2014 2015 > 2015 EBITDA affected by strong increase in Renewables, Retail Germany and G&I East, partly offset by a decline in EBITDA 4,194 4,297 4,521 Retail UK and G&I Germany t/o operating income from > Stable net income contribution to EBITDA from investments 263 306 415 investments accounted for using the equity method as well as other income from investments Operating depreciation, amortisation and impairment (1,350) (1,438) (1,471) > Non-operating result, amongst other things, includes book losses gains or losses from the disposal of investments or non- Operating result 2,844 2,859 3,050 current assets not required for operations, impairments as well as effects of the fair valuation of certain derivatives Non-operating result (832) (83) 50 2013: largely affected by impairments related to Spanish • t/o impairments (799) - (167) wind farms, primarily due to the government decision to retrospectively cut renewable energy subsidies t/o restructuring (315) (103) 15 • 2015: largely affected by impairments related to the IT t/o disposals 211 33 65 infrastructure in Retail UK t/o mtm derivatives 24 (14) 135 t/o other 47 1 2 innogy · company presentation · 1 August 2016 page 37

  23. Financials P&L summary (2/2) – historical financial result and tax not representative of innogy’s future set-up innogy Group Comments > Financial result not representative of future capital structure given € million 2013 2014 2015 assumptions behind combined financial statements (CFS) • In addition, 2016E financial result will be affected by amortisation of Financial result (567) (555) (302) fair value 'step-up' 1 > Financial income in 2015 includes €279m gains from disposal of t/o financial income 406 445 578 marketable securities held by regional majority participations t/o financial costs (973) (1,000) (880) > Effective tax rate not representative for going concern given CFS did not take into account tax groups, e.g. for offsetting purposes. Other effects: Income from continuing 1,445 2,221 2,798 • 2013 taxes includes €(144)m effects from the non-usability of operations certain tax loss carry-forwards Taxes on income (551) (523) (860) • 2015 taxes includes €(258)m effects from non-deductible expenses, e.g. transfer of loans, and €95m effects from non-taxable income, Effective tax rate 38.1 % 23.5 % 30.7 % e.g. tax-free gains from disposal of marketable securities Income 894 1,698 1,938 > 2015 increase in non-controlling interest driven by both structural and one-off effects: t/o non-controlling interest 230 231 325 • Macquarie increasing stake in RWE GasNet by 15% t/o one-off effects in non- >50 2 One-off income from disposal of marketable securities by non-100% • controlling interest owned German regional utilities (>€50m vs. 2014; pre-tax) Net income 664 1,467 1,613 > Given limitation above, net income is not representative of going concern net earnings level of the innogy Group 1 Refers to bonds transferred from Finance BV and Finance BV II. 2 Pre tax. innogy · company presentation · 1 August 2016 page 38

  24. Financials innogy’s normalised tax rate in the order of 25-30% innogy Group Comments € million 2013 2014 2015 > Historic tax rate not representative Taxes on income (551) (523) (860) > 2016 tax rate will be significantly impacted by one-offs due to the ongoing restructuring – to be adjusted in the adjusted net Effective tax rate 38.1 % 23.5 % 30.7 % income > Going forward, innogy expects a normalised tax rate within Statutory tax rate for the range of 25%-30% 31% 31% 31% innogy tax group > Expected cash tax rate of 20%-25% due to use of deferred tax Germany 31% 31% 31% assets related to the foundation of innogy UK 23% 21% 20% NL 25% 25% 25% ~25%-30% East ~23% ~24% ~24% normalised tax rate 1 1 Relevant for adjusted net income. innogy · company presentation · 1 August 2016 page 39

  25. Financials innogy’s capital structure – next steps to reach leverage target 3 2 4 1 Cash contribution Net debt 2015 Net debt H1 2016 and D/E swap in IPO proceeds July 2016 > H1 capitalisation reflective > €0.9bn cash capital > ~ 10% 2 primary capital > External senior bonds of all relevant intercompany contribution used for increase at IPO transferred to innogy from transactions related to intercompany debt RWE AG (€11.3bn)¹ formation of innogy incl. repayment > Intercompany receivables purchase price payments for > Debt/equity swap of and payables not reflective transferred assets ~ €1.0bn of innogy‘s capital structure Leverage target ~4.0x net debt/ EBITDA Note: further effects may have an impact on net debt. 1 Refers to bonds transferred from Finance BV and Finance BV II. 2 Post money. innogy · company presentation · 1 August 2016 page 40

  26. Financials innogy net debt composition and impact of the envisaged IPO 31 Dec 2015 (€ bn) Changes in H1 2016 1 Changes in Jul 2016 1 Net debt item 1 2 3 Impact from IPO 4 + ~ 10% 2 primary capital Cash & cash equivalents 0.6 No significant changes No significant changes increase at IPO Marketable securities 1.9 3 Potential valuation changes Potential valuation changes - Other financial assets 12.4 4 Transaction driven changes No major changes expected 5 - A Financial assets 14.9 4 ./. €850m bond repayment in Bonds and bank debt 12.9 No changes expected - April 2016 6 Adjustment for 'step-up' of bonds Amortisation of 'step-up' over Amortisation of 'step-up' over (1.2) - to market values maturity of bonds maturity of bonds 5 Other financial liabilities incl. ./. ~€1bn debt/equity swap 6.1 Transaction driven changes - intercompany loans 7 ./. €0.9bn IC debt repayment Financial liabilities 7 17.7 B Provisions for pensions and C 3.5 Change in discount rate Change in discount rate - similar obligations Provisions for wind farm 0.3 No significant changes No significant changes - D decommissioning Net debt (B - A + C + D) Increase in net debt Reduction in net debt Reduction in net debt 1 Excluding effects from operating cash flow as well as FX-related changes. 2 Post money. 3 Also includes non-current securities (€26m). 4 Financial receivables adjusted for €0.2bn of loans against associates and unconsolidated subsidiaries. 5 Netting effects may occur. 6 Corresponding effects reflected in other financial assets. 7 Includes hedge transactions related to bonds. innogy · company presentation · 1 August 2016 page 41

  27. Financials Fair value 'step-up' of bonds leads to lower book interest expenses – yet no change on cash interest level Fair value 'step-up' of bonds transferred to innogy with impact on… IFRS B/S value of bonds P&L interest costs of bonds Cash interest costs of bonds Amortisation of 'step-up' 'step-up' €1.2bn Senior bonds Amortisation over maturity €11.3bn of bonds ~5% ~5% ~3% avg. avg. avg. interest cash P&L interest interest 2015¹ 2016 2017 … 2016 Amortisation of 2016 2016 (gross) 'step-up' (net) > > > 'Step-up' resulting from debt transfer transaction Book interest expense reduced by positive book innogy‘s cash > effect from amortisation of 'step-up' over time (to interest Book (as per RWE IFRS B/S) to market value as per be shown within 'interest and similar expenses') equivalent to 18 Dec 2015/28 Dec 2015 2 contractual > Positive effect on net interest expense reversed in > No impact on repayment value coupons identical adjusted net income to RWE AG in the past 1 As of 31 Dec 2015. 2 Respective dates of initial recognition in innogy’s balance sheet. innogy · company presentation · 1 August 2016 page 42

  28. Financials Strong cash generation with a CFOA/EBITDA of around 70% post tax on average innogy Group Comments € billion 2013 2014 2015 > Delta EBITDA vs. FFO mainly related to book gains in EBITDA EBITDA 4.2 4.3 4.5 related to sale of assets and delta between use and build-up of provisions in 2015 (€0.4bn), 2014 (€0.4bn) and 2013 (€0.0bn) > Funds from operations (FFO) declines among others due to Funds from operations (FFO) 3.3 2.9 2.5 • Higher temporary use vs. build-up of provisions in particular pension and personnel provisions in 2015 (€0.4bn), and 2014 Changes in working capital 0.3 0.1 0.2 (€0.2bn), in 2013 balanced use and build-up of pensions and personnel provisions • Temporary increase in cash tax in particular in 2015 vs. 2014 Cash flows from operating 3.7 3.0 2.8 (€0.3bn), partly driven by one-offs related to debt transfer activities (CFOA) from RWE to innogy > Working capital with low volatility in absolute terms Capex 1 (2.3) (2.1) (2.0) • Some one-off effects between 2014 and 2013, mainly related to a y-o-y tax related shift in NL/BE (€0.2bn) Free cash flow 1.4 0.9 0.7 > Lower capex mainly in Renewables after finalisation of major investment projects (Nordsee Ost and Gwynt y Môr) Note: rounding differences may occur. 1 Capex on intangible assets, property, plant and equipment, excluding financial investments. innogy · company presentation · 1 August 2016 page 43

  29. Financials Financial discipline and strict investment criteria – foundation for growing shareholder value Grid & Infrastructure Retail Renewables > ‘Green’ investments in grid > Market entry in adjacent markets > Execute current pipeline mainly Investment focus infrastructure driven by energy in wind > ‘Smart’ investments in technologies transition in Germany > Existing technologies in new markets partly backed by public grants > ‘Smart’ maintenance driven by > ‘New products’ driven by changing > New technology: utility-scale solar digitalisation role of consumers > Growth in selected markets ~ €6.5bn planned capex 1 2016-2018E Indicative capex split ~€1.3bn 2016-2018E ~€0.8bn ~€4.1bn ROI hurdle rates 2 5%-8% 5%-7% 7%-8% core business 5%-15% Note: rounding differences may occur. new markets/new technologies 1 Including financial investments. Pie charts do not include ~€0.2bn of centrally accounted capex mainly for innovation projects. 2 Hurdle rates = after-tax WACC + project risk adjustment + country risk adjustment. innogy · company presentation · 1 August 2016 page 44

  30. Financials Financial outlook 2016 and 2017 Financial year EBITDA Comments Gains from disposals of offshore wind parks and grid assets Gains from first-time consolidation effects and release of provisions 2015A €4.5bn Effects related to regulatory and billing issues in the UK retail business Absence of positive effects, e.g. gain on disposals and release of provisions 2016F €4.1bn – €4.4bn Higher operating and maintenance costs in German distribution network business Operational improvement in UK Retail operations Lower cost base for G&I Germany Gross cost savings in UK Retail in line with targets of recovery programme 2017F €4.3bn – €4.7bn Higher utilisation of installed renewables capacity and addition of capacity, partly offset by lower average revenue per MWh Slight EBITDA improvement from new efficiency programme innogy · company presentation · 1 August 2016 page 45

  31. Financials Financial outlook: key assumptions for G&I EBITDA 2015 EBITDA 2016 Actual €2,878m Forecast €2.5bn – €2.7bn > Book gain from revaluation after first- time consolidation of VSE Slovakia > Slight increase in WACC in CZ (€143m) > High income from grid sales (€153m) > Stable allowed returns on RAB due to largely unchanged regulatory regimes > Stable income from investments in Germany Stable contribution from other business, mainly gas storage and > quasi-regulated water business > Higher operating and maintenance costs in German distribution network business > Lower income from grid sales innogy · company presentation · 1 August 2016 page 46

  32. Financials Financial outlook: key assumptions for Retail EBITDA 2015 EBITDA 2016 Actual €988m Forecast €1.0bn – €1.2bn Release of provisions for legal risks in > > Slight decrease in operational expenditures, also due to continued Germany (€81m) efficiency efforts > Book gain from revaluation in relation Operational improvement in UK from organisational measures, > to first-time consolidation of VSE cost reduction and customer retention measures Slovakia in East (€42m) > Impacts from billing and regulatory > Customer losses in UK and NL, to a large extent offset by customer issues in UK (-€119m 1 ) growth initiatives in other markets 1 Includes (i) net effects of €60m related to charges concerning erroneous and late invoicing, the build-up of provisions for regulatory charges and reviews and the release of provisions for customer paybacks and (ii) net effects of €59m related to billing issues due to changes in revenue estimation. innogy · company presentation · 1 August 2016 page 47

  33. Financials Financial outlook: key assumptions for Renewables EBITDA 2015 EBITDA 2016 Actual €818m Forecast €0.6bn – €0.8bn Gain on disposals of stakes in > Galloper, Gwynt y Môr and Triton > Slight increase in generation volumes: Nordsee Ost and Gwynt y Môr Knoll (€132m) contributing for full year 2016 > Income from Nordsee Ost claims > Better hydrological conditions (€12m) > Lower wind conditions Lower wholesale prices, expected end of subsidies (NL), lower values > > Losses from UK development projects of LECs (UK), lower prices for green certificates (POL) (-€27m) > Negative effects from GBP/EUR FX > Slight increase in operational expenditures driven by higher installed capacity innogy · company presentation · 1 August 2016 page 48

  34. Financials Financial outlook: summary 2015 EBITDA 2016 EBITDA 2017 EBITDA Segment actual (€bn) forecast (€bn) forecast (€bn) Grid & 2.9 2.5 – 2.7 – Infrastructure Retail 1.0 1.0 – 1.2 – Renewables 0.8 0.6 – 0.8 – innogy Group 1 4.5 4.1 – 4.4 4.3 – 4.7 1 Including ‘Other, consolidation’. innogy · company presentation · 1 August 2016 page 49

  35. Financials innogy – definition of adjusted net income as basis for dividend payout ratio €4.1bn – €4.4bn 2016F EBITDA and €4.3bn – €4.7bn 2017F EBITDA Reported EBITDA 1 Operational D&A as % EBITDA in line with historical levels - Operational D&A P&L interest costs adjusted for effect - Adjusted net interest from amortisation of 'step-up' of bonds 25%-30% normalised tax rate - Taxes Net income adjusted for innogy IPO one-off costs and Adjusted net income delta between P&L and cash gross financial debt interest costs Dividends 70%-80% based on adjusted net income 1 EBITDA before one-off costs related to the IPO of innogy which are included in non-operating result only and are added back for the purposes of adjusted net income calculation.. innogy · company presentation · 1 August 2016 page 50

  36. Financials innogy’s financial profile – four takeaways 1 €4.1bn – €4.4bn €4.3bn – €4.7bn EBITDA forecast 2017F EBITDA 2016F EBITDA 2 Stable and highly regulated ~60% Q&A Session Lunchbreak earnings share of regulated 1 EBITDA ~70% ~4.0x 3 Strong cash generation and target leverage CFOA/EBITDA solid capital structure (average 2013-15) net debt/EBITDA >[95]% 70-80% 4 Strong Development of Shareholder value creation Strict capital discipline SAIDI / SAIFI rates dividend pay-out ratio Efficiency factor Among DSOs in Eastern Markets 3 in Germany based on adjusted net income 1 Includes regulated and quasi-regulated business activities. innogy · company presentation · 1 August 2016 page 51

  37. Grid & Infrastructure Overview

  38. Grid & Infrastructure Grid & Infrastructure at a glance Highly predictable, regulated earnings contribution A leading European distribution grid operator 1 Grid & Infra- structure Strong development of €13.3bn RAB 2 with 9% RAB increase 2 expected for Germany and 9% historic RAB growth in Eastern Europe 3 Attractive growth opportunities 1 Based on distributed volume. 2 Regulated asset base. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Throughout this presentation, the RAB relevant for the 2015 tariff figure is used. Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. 3 Historic increase in regulated asset base for Eastern European countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. innogy · company presentation · 1 August 2016 page 53

  39. Grid & Infrastructure A leading European distribution grid operator anchored in Germany €13.3bn +9% +9% regulated asset base 1 increase increase Electricity Gas expected for 2011-’15 for RAB 1 Germany RAB 2 East PL #1 #1 GER CZ gas DSO electricity DSO Czech Republic 3 SK in Germany 3 HU GER GER CZ HU PL SK Distributed volume (GWh) 142,000 73,000 66,500 16,800 7,200 3,700 Grid customers (m) 4 9.3 1.0 2.3 2.3 1.0 0.6 Grid area (‘000 km²) 92 35 46 20 0.5 16 Grid length (‘000 km) 5 356 47 65 67 17 22 €9.7bn RAB 1 €1.6bn €0.9bn €0.7bn €0.5bn Country rating 6 AAA A1 Ba1 A2 A2 Note: all figures (except for RAB) as per 2015. Rounding differences may occur. 1 Regulated asset base. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Throughout this presentation, the RAB relevant for the 2015 tariff figure is used. Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. 2 Historic increase in regulated asset base for Eastern countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. 3 Based on distributed volume. 4 Grid customers are defined as supplied delivery points. 5 Based on operated grid. 6 Source: Moody’s. innogy · company presentation · 1 August 2016 page 54

  40. Grid & Infrastructure G&I with largely regulated and predictable earnings accounting for over 60% of innogy Group EBITDA G&I within innogy By regulated By geography By area business €4.5bn Fully Other consolidated 17% East ~30% Partici- pations 21% Grid Germany Share of regulated 61% ~70% business >80% 2015 EBITDA €2.9bn  No. 1 electricity DSO in Germany² 1 innogy EBITDA 2015  Strong track record of profitable growth in Eastern Europe Renewables  High share of regulated business Retail Grid & Infrastructure 1 Segment breakdown based on sum of operating segment (€4.7bn). Total includes €(0.2)bn presented as ‘Other, consolidation’ in the combined financial statements. Numbers might not add up due to rounding differences. 2 In terms of distributed volume. As of 2015. innogy · company presentation · 1 August 2016 page 55

  41. Grid & Infrastructure Capex above depreciation resulting in RAB growth Development of regulatory asset base (€bn) Capex breakdown 2016-18E¹ +9% +9% expected historic 25% increase for increase for East 2011-2015 2010/11-2015/16 RAB Germany 2 RAB East 3 75% Germany RAB Cumulated Cumulated RAB 2010/11 regulatory capex 2015/16 depreciation Total ~€4.1bn > > Capex continuously above regulatory depreciation over 2011-2015 Majority of capex will be invested in Germany, increasingly for ‘Energiewende’ investments > Resulting RAB growth to support regulated profits > Eastern European capex used mainly for ‘conventional’ grid expansion and new customer connections 1 Capex including financial investments. Includes non-grid capex. 2 Regulated asset base. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. 3 Historic increase in regulated asset base for Eastern European countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. innogy · company presentation · 1 August 2016 page 56

  42. Grid & Infrastructure – Germany Germany – #1 electricity DSO with strong market position in industrial centres innogy key statistics Grid & participations overview Electricity Gas #1 €9.7bn Grid length Hamburg 356 47 electricity regulated (‘000 km) 5 DSO in asset base 1 Germany 2 Berlin Grid customers 6 1.0m 9.3m Hanover Dortmund +9% Essen Dresden Ranking of German electricity increase A leading Cologne and gas DSOs 2 Chemnitz gas DSO 3 expected for German Frankfurt Wiesbaden Electricity Gas RAB¹ Mainz #1 Saarbruecken Augsburg #2 Stuttgart Munich >10m >100 #3 grid municipal participations 4 customers ~ 900 7 ~ 700 8 Total DSOs (#) Distribution network; area: electricity, natural gas and water activities of innogy in Germany 1 Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. 2 Based on distributed volume. Source: RWE, E.ON, EnBW, EWE. Data as of 2015 (except for some EnBW-DSOs which are based on 2014). 3 Based on distributed volume. 4 Not fully consolidated municipal utilities. 5 Based on operated grid. 6 Grid customers are defined as supplied delivery points. 7 BNetzA, Monitoring report 2015. 8 Federal Ministry for Economic Affairs and Energy, website, as of 8 Jun 2016. innogy · company presentation · 1 August 2016 page 57

  43. Grid & Infrastructure – Germany State-of-the-art asset base with #1 positions by volume & load in Germany Electricity distribution grid 1 Volumes (TWh) Network load (GW) Grid length (‘000 km) 142 22 356 347 116 16 10 60 137 innogy E.ON EnBW innogy E.ON EnBW innogy E.ON EnBW #1 #1 #1 Gas distribution grid 1 Volumes (TWh) Network load (GW) Grid length (‘000 km) 22 20 73 73 11 41 56 55 47 E.ON innogy EWE innogy E.ON EWE E.ON EWE innogy #2 #1 #3 Source: RWE, E.ON, EnBW, EWE. 1 Data as of 2015 (except for some EnBW-DSOs, which are based on 2014). innogy · company presentation · 1 August 2016 page 58

  44. Grid & Infrastructure Clear strategic imperatives – efficiency and capitalising on regulatory expertise to drive earnings growth Operational B excellence > Exploit operational synergies from scale of business and best- Regulatory Business practice transfer A C management > Drive efficiency via development further digitalisation and process optimisation > Stable regulatory > Optimised capex strategy for framework leads to sustained earnings growth predictable earnings across markets > Close interaction with > Anticipate changing role of DSO regulators as proven way and benefit from new business to prepare for regulatory models change > Small-scale acquisitions innogy · company presentation · 1 August 2016 page 59

  45. Grid & Infrastructure – Germany High level of experience through long-term A involvement in German regulation > Timeline for electricity to be read as follows: in 2017, assessment of costs of year 2016 (base year) for benchmarking in 2018, beginning of 3 rd regulatory period in 2019 > Gas and electricity with different timelines to relieve the process of cost assessment '06 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 '24 Incentive regulation – 1 st period Cost assessment for 2 nd period Beginning of incentive Efficiency benchmarking for 2 nd period regulation Incentive regulation – 2 nd period Cost assessment for 3 rd period 1 st regulation period Base year for the Efficiency benchmarking for 3 rd period Incentive regulation – 3 rd period Gas Electricity base year for the base year for the 3 rd regulation period 3 rd regulation period innogy · company presentation · 1 August 2016 page 60

  46. Grid & Infrastructure – Germany German incentive regulation – a mature and stable A system Cornerstones of German network regulation Current discussion on regulatory review for 3 rd regulatory period Ex-ante revenue Elimination of time-lag cap regulation for investments Cost recognition based on Adjustment of productivity development actual DSO’s cost base RAB remuneration determined for Setting of new imputed return on equity entire regulatory period Remuneration mechanism for grid expansion Bonus for most efficient DSOs innogy · company presentation · 1 August 2016 page 61

  47. Grid & Infrastructure – Germany Recent ‘wave’ of concession renewals successfully A accomplished – more certainty innogy’s existing concessions Overview of concession renewals¹ 9-12 years 75% Concession- Non- ~65% weighted average based RAB concession- concession ~2/3 based RAB 3 50% duration 2 ~1/3 25% 0% 2011 - 2015 2016E-2020E 2021E-2025E 2026E-2030E >2031E > During the last 5 years (2011-2015), innogy has experienced a ‘wave’ of concession renewal processes  Strong portfolio of ~3,800 concessions 4 > innogy has successfully renewed or transferred to grid participations approx. 90% of its expiring concessions over the last 5 years Fully consolidated entities account for 94%,  > In case of lost concessions, forced grid sale still offers potential for participations 5 for further 6% of total concessions attractive remuneration of current asset base and investments > Fewer upcoming concession renewals in the mid-term ~1/3 of German RAB not based on  > Tender proceedings are based on quality factors concessions 3 , thus providing further earnings stability > innogy’s advantages are, among others, relationship management in existing concession contracts and fast technical solutions 1 Concession renewals based on inhabitants supplied, taking into account exercise of early cancellation options. Chart indicates concessions up for renewal within respective time period, excluding water concessions. 2 Based on inhabitants supplied. 9-year weighted average takes early cancellation options into account. 12-year weighted average excl. early cancellation options. 3 Applies to high voltage, certain regional-based medium voltage grids as well as to high pressure gas grids. Based on 2010/11 RAB in Germany. 4 Including electricity, gas and water concessions. As of 30 June 2016. 5 Refers to grid participations for which an innogy entity is the grid operator. innogy · company presentation · 1 August 2016 page 62

  48. Grid & Infrastructure – Germany G&I with superior operational performance and high B quality assets supporting sustainable performance Costs per high voltage grid length (€’000s/km) 1,2 Cost benchmarking illustrates innogy‘s industry- leading position 4.000 40,000 3.000 3,000  Transparent maintenance and renewal strategy based 2.000 2,000 on technically feasible lifetimes and relevant risk aspects innogy entities 1.000  Efficient and effective processes, e.g. automated 1,000 workforce management 0  Combined investment strategy addressing technical and Costs per substation (€’000s)¹ regulatory perspectives 1.200 1,200 innogy entities 1.000 1,000 800 Typical costs of a grid operator 800 600 600 400 400 Exemplary split for innogy‘s Westnetz 3 200 200 0 0 Other Connecting Costs per connecting points (€)¹ points 60 Substations innogy entities Distribution 40 lines 20 0 innogy grids, benchmarking of 130 grid operators median costs Source: Polynomics AG, 2013. Note: representative subset of 130 major grid operators (out of 196). Grid operators not participating in benchmarking mostly small grid operators. 1 Costs used in regulatory benchmarking process. Outliers graphically cropped. Average excluding outliers. 2 High voltage benchmarking relates to 110kV grids only. 3 Based on 2016E forecast data. innogy · company presentation · 1 August 2016 page 63

  49. Grid & Infrastructure – Germany Smart replacement investments – further enhancing B operational performance and RAB development Optimisation of distribution grids 1 … …leading to increased operational efficiency and reduced O&M costs Improvement of operating metrics Grid length (km) Before Before After Optimisation of Switchgears (#)   investments O&M costs Before After After Degree of cabling 2 (%)  Constantly improving operational performance Before After through smart replacement capex 1 Optimisation example of a medium voltage distribution grid. 2 Degree of cabling = underground cables/total grid length. innogy · company presentation · 1 August 2016 page 64

  50. Grid & Infrastructure – Germany German ‘Energiewende’ opens up significant growth C opportunities for distribution grids …driven by a strong political …which will continue to drive Renewables have transformed will to decarbonise the the expansion of renewables the German energy landscape… economy… 2 100 Thermal electricity Installed capacity from renewables (GW)¹ 25% generation from CHP in 2020 80 Annual decrease in total 60 180 1.5% energy consumption from 2014 to 2020 40 CAGR 5.7% Reduction of greenhouse 40% gas emissions until 2020 20 11 (compared to 1990) 2000 2050 0 Total RES capacity installed (GW)³ Share of electricity 2000 2005 2010 2015 80% demand to be covered by Hydro Wind onshore renewables until 2050 Wind offshore Solar PV Biomass Other 1 Source: AGEE/BMWi. 2 Source: BMUB, BMWI. 3 Source: European Commission. Excluding pump storage hydro generation. innogy · company presentation · 1 August 2016 page 65

  51. Grid & Infrastructure – Germany C ‘Energiewende’ mainly takes place at DSO level… 25 largest network operators in terms of integrated decentral RES capacity¹ 9 100% 8 Installed capacity (GW) 80% 7 Cumulated share 6 60% 5 4 40% 3 2 20% 1 0 0% Westnetz Peer 1 Mitnetz Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 LEW Peer 9 Peer 10 Peer 11 Peer 12 Peer 13 Peer 14 Peer 15 Peer 16 Peer 17 Peer 18 Syna Peer 19 Peer 20 Peer 21 innogy companies Other Cumulated share > In total, 90% 1 of RES capacity is connected to the distribution grid in Germany > With continued growth in RES capacities, DSOs will play a central role in integrating and coordinating the transition towards renewables > innogy is well positioned and at the forefront of this development – already among the leading integrators of installed decentral RES capacity 1 Source: EnergyMap.info; largest German network operators in terms of integrated decentral RES capacity as of August 2015. innogy · company presentation · 1 August 2016 page 66

  52. Grid & Infrastructure – Germany … requiring DSOs to develop intelligent solutions C > Network costs form a substantial part of electricity Grid fees Electricity cost breakdown¹ 25% prices Taxes, levies and fees > Investment needs in distribution grids of 54% Supply €23-49bn until 2032 2 further opportunity for RAB 21% growth > €bn p.a. Political focus to maintain affordable level of i nvestments/costs (15)% (20)% and technical power prices Expected Ø options 2 1.3 1.1 1.0 > Tackling ‘Energiewende’-related investments Conventional Advanced Controllable requires efficient and innovative grid solutions grid energy grid expansion curtailment⁴ devices⁵ > Development of innovative solutions reduces Development of electricity prices Conventional overall investment needs by up to 20% Innovative expansion (ct/kWh) 3 28.7 expansion > As a trusted partner with industry-leading know-how and innovation power, innogy is well positioned to manage the ‘Energiewende’ ‘Energiewende’ - 2016 grid expansion 1 Source: German Energy and Water Association, May 2016; Cost breakdown of electricity for household customers – annual consumption of ca. 3,500 kWh. 2 Source: ‘Moderne Verteilernetze für Deutschland’ (Verteilernetzstudie) – study for the German Ministry of Economics and Energy (BMWi). Investment needs from 2014-2032 assuming conventional grid expansion. 3 Source: German Energy and Water Association, May 2016; Development of electricity prices for household customers (ct/kWh) incl. taxes, levies and fees; annual consumption of ca. 3,500kWh. 4 Curtailment occurs when power output must be shut down in order to balance the grid. Advanced energy curtailment seeks to minimise the resulting economic losses. 5 Controllable grid devices seek to actively address and manage changes in electric frequency due to changes in supply or demand, resulting in less system interruptions as well as adjustments of load depending on current electricity prices. innogy · company presentation · 1 August 2016 page 67

  53. Grid & Infrastructure – Germany Real life examples – innogy enables the ‘Energiewende’ C by expanding grid architecture and integrating RES Geseke Anneliese WP Hakenberg  innogy’s network service business is very Third-party RES integration WP Hölter Berg successful at integrating third-party RES Dyckerhoff SA Milke sources to distribution grid: Erwitte WP Altenautal Husen Lichtenau Example: windfarm Heidenrod WP Oberfeld Büren WP Weiberg > Building and connection of 12 wind Büren WP Vierlinden Wünnenberg power stations within ~½ year R üthen WP WP Meerhof WP Wewelsburg WP Wehlühgel Empertal WP Hohenroden > Supplied households: 26,000 Grid expansion 1 R üthen Bad Wünnenberg WP Neudorf Example: solar park Pferdsfeld 2 Marsberg WP Madfeld Marsberg WP Radlinghausen > innogy to connect 28MW of WP Kohlgrund 1 Giershage Müscheder Weg WP Adorf n generation capacity Substation Nehden WP Kohlgrund 2 Bredelar WEPA Wind park Messinghausen Brilon > Supplied households: 7,000 Brilon Existing before ‘Energiewende’ Accu Investments 2011-2015 An der Bremecke Project pipeline 2016ff Bestwig Ludwigstr. €20m of grid expansion projects (110kV) implemented/being implemented in local area since 2011 €13m of additional grid expansion projects in pipeline (110kV) innogy’s grid business with its continuous investments is the enabler of ‘Energiewende’  Investments increase regulated asset base and will remain of high operational value to avoid grid flow bottlenecks  1 Example refers to area of Büren, Germany. 2 Currently under construction. innogy · company presentation · 1 August 2016 page 68

  54. Grid & Infrastructure – Germany innogy is a clear innovation leader in its field C > ‘Energiewende’ - increasing RES feed-in leading to volatile grid flows Example project ‘Smart Operator’ Photovoltaic > Intelligent solution in the low voltage grid – alternative to conventional expansion Appliances Smart > Smart Operator communicates with feed-in sources and consumers and collects operator Hot data Home energy water controller > Improves forecast of grid load and capacity can then be used to balance supply/demand, i.e. by using household appliances at RES peak feed-in times Intelligent meter > Improved grid planning, transparency and cost effectiveness > Smart country ensures supply of rural areas in times of increasingly decentralised Example project energy ‘Smart Country’ > Voltage stability mechanism reducing need for grid expansion with mechanisms Biogas storage CHP Windfarm such as storage for feed-in balancing, supply/demand analysis technology and more resilient voltage controllers Voltage Biogas controller > Roll-out mostly in small rural municipalities, where energy supply is forecasted to exceed demand by 2030 > Received top award and funding by the German Ministry of Economics and Energy Photovoltaic systems  Tangible innovative solutions  Constantly lifting controllable  Leveraging ‘Energiewende’ cost efficiencies know-how innogy · company presentation · 1 August 2016 page 69

  55. Grid & Infrastructure – Germany Increased focus on ‘Energiewende’ investments C reflected in capex spend Capex breakdown¹ > Optimisation of existing Replacement distribution grid through smart replacement capex 2016-18E total capex G&I Germany ~ €3.1bn 1 > Increases operational Non-grid efficiency and reduces O&M capex Replacement costs 18% 3 34% > Integration of renewables ‘Energiewende’ investments capacity > Smart technology driven by Other grid digitalisation capex 13% 2 > Innovative solutions for grid expansion ‘Energiewende’ Customer connections investments connections Customer 16% 19% > New customer connections ~€3.1bn of investments 2016-18E will continue to support growth in Germany 1 Capex including financial investments. 2 Other grid capex includes investment for non-regulated grid assets such as street lighting, broadband, water or telco activities. 3 Non-grid capex comprises of capex for innogy’s German storage facilities, shares of investment spend related to participations as well as capex for other activities, such as innogy’s water business. innogy · company presentation · 1 August 2016 page 70

  56. Grid & Infrastructure – Germany Participations – strategic partnerships with municipal utilities as key competitive advantage Selected municipal participations 2 Participations as integral component of G&I Participation innogy Income from > Partnerships mainly with municipal utilities extend innogy’s share 2 investments 3 regional coverage across Germany > Participations provide regional identification and customer 20% 27 proximity > Strategic advantage for innogy also in minority participations through its frequent role as service provider 40% 15 > Synergies in the area of testing, developing and rolling out new business models 50% 12 > Best practices and economies of scale in areas such as procurement, risk management and other > >100 municipal participations 1 43% 7 27% 7 Note: largest participations by contribution to G&I income from investments (adjusting for income/losses from loans to other group entities, gains/losses from sale of investments and other components). 1 Not fully consolidated regional or municipal utilities. 2 As per innogy’s combined financial statements. Top municipal 5 participations based on at-equity income contributions shown. Does not include Austrian Kelag with income from investments of €32m. 3 In FY2015. innogy · company presentation · 1 August 2016 page 71

  57. Grid & Infrastructure – Germany/East ‘Other’ business – supplemental utility businesses strengthening local footprint Indicative split of €0.3bn G&I EBITDA 2015A from Other Gas storage Water supply TelCo, service and other Generation activities ~75m m³ ~800GWh 4.3bcm water TelCo LEW electricity working gas supplied in service production from volume 1 2015 provider renewables 5 (RWW) 3 Some subsidiaries providing wide range of B2B/B2C TelCo products and services 11 facilities in Germany and Czech Republic ~600 MW installed Robust ~3,000km Other capacity cash grid length 4 services Conventional margins 2 Generation and Other 6 Energy data management and services Modern, cost-efficient facility management, street lighting storage facilities Hydro, incl. pump storage, run-of-river, as well as small lignite and coal 1 As of 30 Jun 2016. 2 RWE Gasspeicher benchmarking, estimates based on publicly available data and market intelligence. Excluding storage facility for which closure has been initiated. 3 innogy has other minor water supply business activities beside RWW. 4 Source: Umwelterklärung RWW 2015. 5 Source: company information, as per Annual Report 2015. 6 Source: company information. For fiscal year 2015; incl. pumped storage and waste. innogy · company presentation · 1 August 2016 page 72

  58. Grid & Infrastructure – Germany/East Gas storage – despite poor summer-winter spreads, innogy’s gas storages with robust cash margin position innogy’s gas storage portfolio in Germany and the Czech Republic Working gas  innogy’s gas storage portfolio mainly > volume (bcm) 1 comprising of cavern storages in Germany and depleted gas fields in the Czech Republic 5 storage facilities 2 1.63  > Comparably high cash margins 6 storage facilities 2.71  Storage system operator in Germany > Industry-leading feed-in times – Storage system operator in the Czech Republic well-positioned to benefit from German ‘Energiewende’ North-Western Europe Industry cash margins 3 innogy facilities 4 Closure Czech Republic, Slovakia and Austria initiated innogy’s gas storage portfolio exclusively comprising of cash-generative assets – strategic measures taken in the past for best positioning to capture future upsides Source: innogy estimates based on publicly available data and market intelligence. 1 As of 30 Jun 2016. 2 Excluding storage facility for which closure has been initiated. 3 Cash margin defined as (revenue ./. opex); revenues are simulated at current market prices and do not take into account possible long-term contracts; opex is estimated on basis of available technical and other parameters such as type, size, depth of storage, etc. 4 Includes one facility which will be closed; another facility is represented by two bars representing the original facility and its extension, bringing innogy’s total number of storages to 7 in the ranking for North-Western Europe. innogy · company presentation · 1 August 2016 page 73

  59. Grid & Infrastructure – Germany RWW – innogy‘s water competence is one of the largest in Germany RWW overview RWW at a glance Weseke Velen Burlo Gescher-Hochmoor > €33m 1 RWW is one of the largest privately owned ~3,000 km Borken water utilities in Germany Reken 2015A grid length EBITDA > Provides drinking water to 135k connections and Raesfeld-Erle 900k citizens Schermbeck Wesel > Dorsten Industrial customer base and hydroelectric Monopolistic, 850 km² quasi-regulated power plant diversify business profile industry area served Gladbeck Dinslaken structure > Stable, concession-based business models Bottrop Gelsenkirchen Oberhausen providing long-term earnings visibility Essen (important current concessions until 2027) (innogy headquarter) Duisburg ~75m m³ 63,000 m³ Mülheim an der Ruhr > Awarded as top water utility 2016 in several (RWW headquarter) capacity 1 of drinking water categories such as quality, service and supplied RWW’s Velbert Ratingen Heiligenhaus transparency 13 reservoirs in 2015 Wülfrath Service point Direct supply Water treatment plant Supply to third-party distributors Water reservoir Emergency water supply Distribution grid Water protection area Note: all figures based on RWW Rheinisch-Westfälische Wasserwerksgesellschaft mbH (2016) - RWW Umwelterklärung 2015, unless otherwise stated. 1 Company information. innogy · company presentation · 1 August 2016 page 74

  60. Grid & Infrastructure – Germany Grid & Infrastructure Germany – key takeaways €9.7bn 9% RAB increase €9.7bn RAB¹ RAB¹ expected for German RAB¹ 9.05%² until 2017/18 return on equity for current regulatory period in Germany GER ~97% efficiency factor in Germany Among the leading RES-integrators in Germany 1 Regulated asset base. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Throughout this presentation, RABs are always stated excluding pro- rata share of RAB from participations that are not fully consolidated. 2 Nominal return on equity on existing RAB until 2017/18 according to German ARegV for new assets (post 2005); 7.14% real for old assets (pre 2006); stated returns pre corporate tax, after trade tax. Based on current initial proposal from BNetzA, return on equity to change to 6.91% for new assets and 5.12% for old assets in the next regulatory period. innogy · company presentation · 1 August 2016 page 75

  61. Grid & Infrastructure – East Leading positions in Eastern markets based on diverse electricity and gas portfolio in four different countries +9% €3.6bn increase 2011-’15 regulated for Eastern asset base countries’ (RAB) 1 RAB 2 PL #1 #2 gas DSO CZ e lectricity DSO Czech SK Hungary 3 Republic 3 HU Electricity Gas CZ HU PL SK Distributed volume (GWh) 66,500 16,800 7,200 3,700 Grid customers (m) 4 2.3 2.3 1.0 0.6 Grid area (‘000 km²) 46 20 0.5 16 Grid length (‘000 km) 5 65 67 17 22 RAB¹ €1.6bn €0.9bn €0.7bn €0.5bn Country rating 6 A1 Ba1 A2 A2 Note: all figures as of 2015. 1 Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. RAB values reflect RABs relevant for the tariff in 2015. 2 Historic increase in regulated asset base for Eastern countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. 3 Based on distributed volume. 4 Grid customers are defined as supplied delivery points. 5 Based on operated grid. 6 Source: Moody’s. innogy · company presentation · 1 August 2016 page 76

  62. Grid & Infrastructure – East innogy’s Eastern Europe operations – a success story Key pillars of value creation in Eastern European countries > Restructuring of acquired incumbents Restructuring > Process improvement and best practice transfer  Successfully entered markets via privatisation between 1995 > Successfully managed several regulatory periods in different and 2003 at attractive regulatory environments Experience valuations > Systematically optimising businesses within regulatory frameworks > Good working partnerships with governments, municipalities and  Diverse portfolio of grid financial investors Strong businesses/infrastructure partnerships > Support governments in energy market transition and play active across different markets and and important role in DSO landscape commodities > Increased efficiency with continuous process optimisation and Operational best practices excellence > Exchange of DSO knowledge with Germany  Further growth potential in Eastern Europe through > Development of innovative pilot projects further demand growth and > Grid automation contributing to and benefitting from German Innovation additional RES integration ‘Energiewende’ know-how innogy · company presentation · 1 August 2016 page 77

  63. Grid & Infrastructure – East Czech Republic – track record of continuous optimisation and investments innogy 83% Other DSOs 17%  Long-standing experience in regulatory management Gas distribution market share 1 and established relationship with regulator. Successfully managed the business through 3 regulatory periods since entry in 2002  Continuously optimised processes/increased efficiency (# of employees decreased by ~10% since 2007) 2 Country highlights Regulation  Significant simplification of governance structures and €1.6bn 7.94% WACC 3 realisation of operative synergies (regional integrated RAB increase RAB 2 (RP 2016-18) companies transformed to nation-wide functional vs. last period business)  Successful financial partnership with a consortium of Significant simplification of structures Geographical funds managed by Macquarie Infrastructure and Real 2002 2013 presence SČP Assets, the 49.96% shareholder (increased from 35% in 2015) VČP ZČP STP RWE Gasnet 4 SMP JČP JMP JMP  Continuous increase of RAB to €1.6bn 6 regional integrated gas companies 1 company 1 Source: Energy Regulatory Office (2016): yearly report on the operation of the Czech gas system in 2015. Based on distributed volume in 2015. 2 As of 2015. 3 Nominal WACC value. 4 Only DSO. innogy · company presentation · 1 August 2016 page 78

  64. Grid & Infrastructure – East Hungary – leading distributor in Budapest and North-East – setting the pace of innovation in Hungary Other DSOs ~60% innogy ~40%  Long-standing experience in regulatory management Electricity distrib. market share 1 and established relationship with regulator. Successfully managed the business through 4 regulatory periods since entry in 1995  Successful integration of two operating companies (ELMÚ/ÉMÁSZ) through steering by one management team  Future strategic focus on exploitation of digital grid Country highlights Regulation solutions to increase network quality and increase €0.9bn operational efficiency 6.23% WACC 3 RAB decrease RAB 2 (RP 2013-16)  Decrease in RAB vs. previous regulatory period driven vs. last period mainly by negative fluctuations in the exchange rate between EUR and HUF  Re-increased investment volume and improved Geographical operational efficiency to compensate for ÉMÁSZ 4 presence ELMÚ 4 remuneration decrease caused by politically driven TITÁS ÉDÁSZ energy price cuts and sector specific taxes  Development of innovative pilot projects in DÉMÁSZ DÉDÁSZ cooperation with local authorities, e.g. urban solutions 1 Based on innogy estimation of distributed volumes. 2 As of 2015. 3 Real WACC value. 4 innogy subsidiaries: ~54% and ~55% share in ÉMÁSZ and ELMÚ, respectively. innogy · company presentation · 1 August 2016 page 79

  65. Grid & Infrastructure – East Poland – distributor for dynamically growing Warsaw – actively involved in innovating Polish distribution sector innogy 6% Other DSOs 94%  Long-standing experience in regulatory management Electricity distrib. market share 1 and established relationship with regulator. Successfully managed the business through 3 regulatory periods since entry in 2003  Our DSO plays an active important role in the DSO landscape and chairs the TSO and DSO association  Leveraging position in capital city of Warsaw to Country highlights extend innovation leadership, e.g. AmpaCity and a Regulation unique prototype of a demand response tool €0.7bn 5.675% WACC 4 RAB increase  Front runner role in Poland with smart metering pilot RAB 2 (RP 2016-20) vs. last period 3 project for 100,000 meters in Warsaw leading to additional remuneration  Very good SAIDI 5 and SAIFI 6 rates among Polish DSO for dynamically growing capital Warsaw incumbent DSOs 7 Geographical presence  Continuously increased RAB; regulatory step-up Warsaw reached in 2014 1 Based on distributed volume. Data as of 2015. 2 As of 2015. 3 RAB adjusted each year. 4 Nominal WACC value confirmed for 2016; following years to be adjusted according to risk free rate development. 5 System average interruption duration index. 6 System average interruption frequency index. 7 Source: company information about the largest Polish DSOs as per FYE 2014. innogy · company presentation · 1 August 2016 page 80

  66. Grid & Infrastructure – East Slovakia – No. 3 position – successful cooperation with Slovakian government, full consolidation since 2015 Other DSOs 80% innogy 20%  Long-standing experience in regulatory management Electricity distrib. market share 1 and established relationship with regulator. Successfully managed the business through 3 regulatory periods since entry in 2003  Strong partner to the Slovakian government with full management rights Country highlights  Constant RAB within last regulatory period Regulation €0.5bn 6.12% WACC 3  49% shareholding, however, full consolidation under Constant RAB RAB 2 (RP 2012-16) vs. last period 2 IFRS since 2015 driven by management rights assigned to innogy  Ongoing smart metering roll-out >4MWh p.a. until Geographical 2020 and clear focus to increase grid automation SSE-D presence  Constant investment of ~€40m p.a. 5 – continuous asset renewal, increase quality of supply and safety of ZSD VSD 4 (innogy) operations 1 Source: Energy Analytics – Energeticky TRH SR 2015. 2 RAB introduced in 2012. 3 Real WACC in 2016. 4 Subsidiary of VSE Holding. 5 Refers to 2010-2015. innogy · company presentation · 1 August 2016 page 81

  67. Grid & Infrastructure – East East – regulation across countries with A near-term stability of regulatory parameters Regulatory model overview Regulatory period overview > Transparent regulatory framework CZ 2016 - 2018 > Close interaction with regulators based on years of trust and reliability HU 2017 - 2020 > Similar formulae for regulated revenues/prices in all four countries PL 2016 - 2020 > Stable returns from RAB 2017 - 2021 SK • For 2/3 of East RAB (CZ and PL) expected until 2018 and 2020 respectively due to both regulatory 2015 2017 2019 2021 periods beginning in 2016 Electricity distribution Gas distribution • For 1/3 of East RAB (SK/HU) trustful consultations ongoing on new regulatory period starting 2017 Largest RABs Broadly similar Overlapping regulatory in stable countries regulation systems periods provide stability innogy · company presentation · 1 August 2016 page 82

  68. Grid & Infrastructure – East Operational excellence – reflected in continuous B improvement of quality of distribution Improving grid performance 1 … …driven by focus on modernisation investments 157 Slovakia: significantly improved quality of supply 126 > Result of considerable increase in investment volume SAIDI (min) 2 73 63 > Replacement of critical assets and grid renewal > After roll-out of high voltage grid automation, ongoing roll-out in medium voltage space 2012 2015 2010 2015 > Shorter response times in case of outages by introduction of modern SK 4 HU 5 workforce management system > Regulator is monitoring various quality standards, customers are automatically compensated by DSO if not keeping a quality standard 2.15 1.72 Hungary: DSO improvement measures 1.19 1.02 > Intelligent medium voltage/low voltage stations SAIFI 3 > Grid automation solutions > Upgrade of IT solutions: mobile workforce management, supervisory 2012 2015 2010 2015 control and data acquisition system, condition-based maintenance SK 4 HU 5 strategy and advanced geographical information systems > Investment strategy incentivised by bonus/malus system Source: innogy company information. 1 Note: quality parameters among countries not directly comparable due to different grid structures and technical conditions. 2 System average interruption duration index is a reliability indicator of average outage duration for each customer served, measured in minutes per annum. 3 System average interruption frequency index is a reliability indicator of average numbers of interruptions per year. 4 Comparable methodology starting from 2012. As per innogy company information. 5 Metrics presented related to ELMÚ. innogy · company presentation · 1 August 2016 page 83

  69. Grid & Infrastructure – East Future investments in East mainly driven by C replacement and customer connections Capex breakdown¹ > Optimisation of existing grid Replacement > Modernisation of stations and gas 2016-18E total capex G&I East ~ €1.0bn 1 pipelines; construction of cables and overhead lines on all voltage levels > Increases operational efficiency and Non-grid capex 6% 2 reduces O&M costs Other grid capex 3 Replacement 5% 70% ‘Energiewende’ > Growth in connection numbers driven investments 4 Customer Connections by underlying macro factors 1% (population, energy demand) > Mostly customers from existing grid; Customer connections new lines where load demand exceeds 17% current capacity > Connections of renewables so far less pronounced, but growth foreseeable in the future > Primarily IT hardware and software Other > Third party driven investments ~€1.0bn of investments 2016-18E rebuilding existing grid routes or cabling will continue to drive growth overhead lines to free the ground in innogy’s Eastern markets 1 Capex including financial investments. 2 Non-grid capex contains investments in storage, overhead (e.g. renewal of buildings, IT investments) and other. 3 Other grid capex primarily includes IT investments or third party capex. 4 Mainly relates to smart meter investments. innogy · company presentation · 1 August 2016 page 84

  70. Grid & Infrastructure – East Grid & Infrastructure East – key takeaways €3.6bn 9% RAB increase €9.7bn RAB¹ RAB¹ 2011-2015 for East RAB 2 Value creation through market entry capabilities PL and continuous optimisation CZ #1 SK gas DSO in Czech Republic 3 HU Operational excellence (SAIDI/SAIFI) Electricity Gas 1 Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. RAB values reflect RABs relevant for the tariff in 2015. 2 Historic increase in regulated asset base for Eastern countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. 3 Based on distributed volume. innogy · company presentation · 1 August 2016 page 85

  71. Grid & Infrastructure Grid & Infrastructure – key takeaways 1 €13.3bn 9% RAB increase ¹ 9% RAB increase 2 A leading European distribution grid operator RAB¹ expected for Germany for East 2011-15 Predictable, regulated earnings 9.05% 3 until 2017/18 ~6.5% 4 2 contribution – secured return on equity for pro-forma WACC by stable regulatory frameworks current regulatory period in Germany Eastern European countries 3 ~97% Continuous Highly efficient operations with excellent network reliability efficiency factor in Germany optimisation 4 Among the leading Investment opportunities from renewables expansion RES-integrators in Germany Further growth through 5 ~ €4.1bn dedicated investments as key 2016-18E G&I capex 5 driver for regulated profit growth 1 Regulated asset base. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. Expected increase in German regulated asset base calculated as RAB 2010/2011 plus net investments (post concession gains/losses) in regulated assets in the years 2010/2011 to 2015/2016E, assuming full recognition by the regulator. Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Throughout this presentation, the RAB relevant for the 2015 tariff figure is used. Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. 2 Historic increase in regulated asset base for Eastern countries calculated as RAB relevant for tariff in 2015 vs. RAB relevant for tariff in 2011 (in € at constant 2011 year-end exchange rates) for Czech Republic, Hungary and Poland. Growth rate excludes Slovakia as RAB was introduced in 2012 only and RAB will only be adjusted in next regulatory period starting 2017. Including FX effects, RAB would have increased by ~7%. 3 Nominal return on equity on existing RAB until 2017/18 according to German ARegV for new assets (post 2005); 7.14% real for old assets (pre 2006); stated returns pre corporate tax. Based on current ‘initial’ proposal from BNetzA, return on equity to change to 6.91% for new assets and 5.12% for old assets in the next regulatory period. 4 Pro-forma RAB-weighted average WACC of CZ, HU, PL and SK. SK RAB only included for 4 months due to first-time consolidation of VSE in 2015. 5 Including financials investments. innogy · company presentation · 1 August 2016 page 86

  72. Grid & Infrastructure Regulatory deep dive

  73. Grid & Infrastructure – Regulatory deep dive G&I Germany EBITDA driven by significant asset base and income from participations and complementary activities Earnings composition Breakdown of 2015 EBITDA (€bn) > Regulated asset base 1 9.7 RAB of fully consolidated grid businesses > Pro-forma WACC based on 2010/2011 regulatory Pro-forma WACC 2 6.1% cost of equity and debt and blended capital structure of our regulated businesses Return on RAB 0.6 > Grid Grid Grid sales > Non-regulated grid business (e.g. grid services) Other grid earnings (regulated/ 0.4 > unregulated) Regulatory acknowledged depreciation vs. IFRS > Additional regulatory compensation (e.g. D&A (IFRS) 0.5 investment measures in 110kV grid) > Grid EBITDA 1.5 Operational efficiencies Part. Part. > Mainly participations and JVs with municipal utilities Income from participations³ 0.2 > Gas storage business in Germany Other Other > Quasi-regulated water business Non-grid business/other 0.3 > Other EBITDA 2.0 Note: numbers may not add up due to rounding. 1 Numbers based on latest notification by regulator. RAB stated excluding pro-rata share of RAB from participations that are not fully consolidated. 2 Pre-tax WACC (before corporate and trade tax) calculated based on several assumptions, including 60/40% debt/equity ratio of regulatory assets and 50/50% split new/old assets. Return on regulatory equity for new/old assets of 9.05% nominal/7.14% real (before corporate tax, after trade tax). Cost of debt of ~4% pre-tax. 3 Operating income from investments, to a large extent comprising of at-equity income from investments, included within EBITDA. innogy · company presentation · 1 August 2016 page 88

  74. Grid & Infrastructure – Regulatory deep dive German incentive regulation provides for a predictable and stable remuneration framework > No volume risk – DSOs not impacted by fluctuations in demand Ex-ante revenue > Stable ex-ante framework codified by law, as opposed to ex-post supervision by regulator cap regulation > Revenue cap mechanically updated year by year – mainly without regulatory discretion > Cost recognition stable for 5-year regulatory periods Cost recognition > based on DSO’s Non controllable costs treated as pass-through in regulatory formula actual cost base > Inflation factor as effective macro hedge > RAB split into 40% equity 1 and 60% debt by regulatory definition RAB remuneration > Return on regulatory equity fixed at nominal 9.05% (7.14% real for old assets) 2 for entire determined for regulatory period until 2017/18 entire regulatory > Cost of debt treated as pass-through and therefore allows for natural hedge against changes in period interest rate environment > Expansion factor included in revenue cap formula with 1-year time lag Remuneration mechanisms for > Investment measure mechanism recognised without time lag, established to support grid expansion expansion of 110kV investments Note: figures based on current parameters – may be subject to change. 1 Maximum value. 2 Returns before corporate tax, after trade tax. innogy · company presentation · 1 August 2016 page 89

  75. Grid & Infrastructure – Regulatory deep dive German incentive regulation – a mature and stable system Regulatory timeline 1 st regulatory period 2 nd regulatory period 3 rd regulatory period (5 years) (5 years) (5 years) Cost base in 2011 Cost base in 2016 relevant for revenue relevant for revenue Electricity cap in 2 nd regulatory cap in 3 rd regulatory period period 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Cost base in 2010 Cost base in 2015 relevant for revenue relevant for revenue cap in 2 nd regulatory cap in 3 rd regulatory Gas period period 1 st regulatory period 3 rd regulatory period 2 nd regulatory period (4 years) (5 years) (5 years) Initial proposal BNetzA RoE 1 9.29% 7.56% 9.05% 7.14% 6.91% 2 5.12% 2 Elec./Gas New Old Return on imputed Base year assets 3 assets 4 equity (RoE) 5 1 Return on equity. 2 BNetzA’s current initial proposal for return on equity as per current consultation process. 3 Nominal. New assets subject to historic cost accounting. 4 Real. Old assets subject to current cost accounting. 5 Returns before corporate tax, after trade tax. innogy · company presentation · 1 August 2016 page 90

  76. Grid & Infrastructure – Regulatory deep dive Revenue cap is determined based on returns on RAB + imputed depreciation + base year cost base Composition of revenue cap pre-efficiency, expansion and inflation factor Imputed depreciation Revenue cap Returns on RAB Acknowledged opex and trade tax Imputed depreciation equivalent to linear depreciation of regulatory Derived from P&L under German asset values Actual cost of GAAP for regulated grid business Financial debt in base year Regulatory asset life differs from debt compensated as IFRS and German GAAP 60% pass-through Controllable Costs and and Asset value Compensated Excess equity with ~4%¹ Imputed trade tax equivalent to trade tax on the regulatory return Compensated with Max. 40% As acknowledged by regulator, on equity, calculated before 9.05% (nominal)/ Equity subject to regulatory cuts corporate tax (~15%) but after trade 7.14% (real) for Return on tax (~15%) new/old assets 2 Equity RAB Regulatory capital structure Note: figures based on current parameters – may be subject to change. Discussion of (i) revenue cap (leaving out other components such as (a) quality element (§19 ARegV), (b) volatile costs (§11 ARegV), or (c) regulatory accounts (§5 ARegV)) and of (ii) asset base (leaving out other components such as (a) financial assets or (b) deduction capital) for illustrative purpose only. 1 3.98% for electricity and 4.19% for gas as per second regulatory period. 2 Returns before corporate tax, after trade tax. innogy · company presentation · 1 August 2016 page 91

  77. Grid & Infrastructure – Regulatory deep dive Revenue cap is adjusted for efficiency, productivity and inflation to mirror developments between base years Current regulatory period – before adjustments for investments Non-controllable Controllable Efficiency Revenue cap Inflation Productivity costs costs 2011 base year During regulatory period Inefficient controllable costs Controllable costs subject to efficiency adjustment Expense equivalent costs Opex > Productivity targets mandated by the regulator > Directly derived from P&L and inflation Benchmarking process statement under German GAAP > The relevant efficiency parameters of each > Actual cost of debt as pass-through DSO are benchmarked Efficient > Revenue targets are set taking into account controllable targeted efficiency gains on controllable costs costs over the regulatory period Cost of debt Imputed costs Depreciation Cost of Capital Non-controllable costs > Regulatory return on equity and Trade tax > Costs incurred outside of influence of DSO like excess equity payment for use of higher voltage levels of > Imputed trade tax Return on Non- other grid operators and subsidies for equity controllable > Imputed depreciation decentralised generation 1 costs > Partially annually adjusted Actual/ Regulator imputed perspective Note: illustrative discussion of revenue cap leaving out other components such as (i) quality element (§19 ARegV), (ii) volatile costs (§11 ARegV), or (iii) regulatory accounts (§5 ARegV). 1 Additional components include, e.g. advances and construction grants, pension costs or non-wage labour costs. innogy · company presentation · 1 August 2016 page 92

  78. Grid & Infrastructure – Regulatory deep dive Revenue cap ‘mechanics’ – two levers to adjust for investments completed between base years 2 1 Non- Revenue Cap Adjustment Controllable Efficiency Inflation Productivity Expansion controllable 2 nd regulatory period - exemplary for electricity regulation Inflation, productivity, efficiency and expansion factors and adjustments to non controllable costs 1 Annual adjustment of controllable costs via expansion factor 1 > Applies to medium- and low Controll - Controll - voltage levels 1 able able costs costs > Measured by relative growth of area supplied (low voltage) and relative growth of number of connections - 2 2 Annual adjustment of non-controllable Non con - costs Non con - trollable trollable > Investment measures treated as costs costs non-controllable costs (110kV networks) 2014 2015 2016 2017 2018 Source: innogy; BNetzA. Note: illustrative discussion of revenue cap leaving out other components such as (i) quality element (§19 ARegV), (ii) volatile costs (§11 ARegV), or (iii) regulatory accounts (§5 ARegV). 1 Independent of pressure ratings for gas. innogy · company presentation · 1 August 2016 page 93

  79. Grid & Infrastructure – Regulatory deep dive 3 rd regulatory period – changes to both existing framework and to key parameters – need for combined assessment Changes to regulatory framework Changes to parameters within given framework > > 1 Jun 2016 German government decides 6 Jul 2016/ BNetzA releases initial proposal Changes to parameters within given framework on draft regulation proposal for return on equity and starts 13 Jul 2016 > consultation process Key changes Changes to regulatory framework Current RP Next RP • Capital cost true-up • Special bonus for efficiency > > New assets New assets Return on • Increased transparency equity 9.05% 6.91% > > Old assets Old assets > 8 Jul 2016 Upper House of Parliament 7.14% 5.12% (Bundesrat) decides on draft Productivity > > 1.5% Not yet proposal factor specified > Early August Government to give consent to Bundesrat decision > 10 Aug 2016 End of consultation process > 2018/19 Most changes will apply only > Sep/Oct 2016 Final decision expected with start of the 3 rd reg. period > 2018/19 Changes will apply only with start of the 3 rd reg. period Proposed amendments for next regulatory period need to be assessed as a ‘single package’ since individual changes can, to some extent, be compensated/mitigated by other measures innogy · company presentation · 1 August 2016 page 94

  80. Grid & Infrastructure – Regulatory deep dive Potential changes in 3 rd regulatory period proposed by German government 1 Draft proposal for 3 rd regulatory period… …provides further opportunities  Significant investments > Update of remuneration on regulatory asset base during planned in the future regulatory periods Elimination of  Superior operational • Recognition of new investments in RAB² on yearly basis time-lag for performance • RAB remuneration to be reduced annually in line with investment depreciating asset base  Innovative solutions for budgets ‘Energiewende’ challenges Investments from 2007 to 2016 exempt from changes in • remuneration Change will only impact G&I’s financial performance from 2019 (electricity)/2018 (gas) onwards > Introduction of new bonus for most efficient DSOs Bonus for most > Available to DSOs with 100% efficiency to encourage efficient DSOs innovative investments in grid technology and expansion > Increased Regulator to publish additional information on the regulatory transparency parameters and targets Source: Verordnungsentwurf Bundesregierung, Bundesrat as per 8 July 2016. 1 Updated for amendments made by the Bundesrat as per 08 Jul 2016. Decision by federal cabinet expected in early August. 2 Previously time lag of up to 7 years. innogy · company presentation · 1 August 2016 page 95

  81. Grid & Infrastructure – Regulatory deep dive G&I East EBITDA driven by significant asset base and other grid earnings Earnings composition Breakdown of 2015 EBITDA (€bn) > Regulated asset base 1,2 RAB of fully consolidated grid businesses in CZ, HU, 3.6 PL and SK Pro-forma WACC 6.5%³ > Pro-forma WACC based on weighted average implied WACCs for all 4 countries Return on RAB 0.2 Grid Grid > Regulatory acknowledged depreciation vs. IFRS > Others (non-regulated services, volume Other grid earnings 0.2 (regulated/unregulated) corrections) > Operational efficiency D&A (IFRS) 0.2 Grid EBITDA 0.6 Income from participations 2,4 Part./Other Part./Other 0.1 > Participations: ZOV (Zagreb waste water business) Non-grid business/other 0.1 > Gas storage business in CZ VSE consolidation effect 0.1 EBITDA 0.9 Note: numbers may not add up due to rounding. 1 Generally, RABs from different regulatory regimes are not directly comparable due to significant methodological differences (e.g. regulatory periods, regulatory depreciation periods). Also, throughout this presentation, RABs are always stated excluding pro-rata share of RAB from participations that are not fully consolidated. Numbers based on latest notification by regulator or based on calculations in latest filings with regulators. RAB values reflect RABs relevant for the tariff in 2015. 2 First-time full consolidation of VSE during 2015. Pro-forma RAB value shown assuming full-consolidation of VSE during 2015. For calculation purposes, RAB only included for 4 months in 2015. Income from participations for VSE included for 8 months in 2015. 3 Pro-forma RAB-weighted average WACC of CZ, HU, PL and SK. SK RAB only included for 4 months due to first-time full consolidation of VSE in 2015. 4 Income from participations, to a large extent comprising of at-equity income from investments, included within G&I EBITDA. innogy · company presentation · 1 August 2016 page 96

  82. Grid & Infrastructure – Regulatory deep dive East regulation – similar key elements with country specific characteristics Regulatory model overview Czech Republic Hungary Poland Slovakia Current regulatory period 2016-2018 2013-2016 2016-2020 2012-2016 Type of regulation Revenue cap Price cap Price cap Price cap General Incentive elements in     regulatory framework Regulated asset base (RAB) €1.6bn €0.9bn €0.7bn €0.5bn RAB/WACC Regulatory WACC (pre-tax) 7.94% 1 6.23% 2 5.675% 3 6.12% 2     Regulatory Efficiency factor 4 opex     Pass-through of financing costs treatment     Regulation of quality of supply 5     Exposure to volume risk Other     Inflation 6     Compensation for investments 1 Nominal WACC value. 2 Real WACC value. 3 Nominal WACC numbers confirmed for 2016; following years to be adjusted according to risk free rate development. Nominal WACC value. 4 Efficiency factor reflects elements of individual as well as industry/macro-related productivity components. 5 Bonus/malus system for stability. 6 Inflation effects considered in regulatory revenues. innogy · company presentation · 1 August 2016 page 97

  83. Grid & Infrastructure – Regulatory deep dive Regulatory deep dive – key takeaways 1 Mature regulatory frameworks with predictable and stable remuneration 2 Strong experience in managing regulatory frameworks across countries Key takeaways Q&A session 3 Coffee break 3 rd regulatory period in Germany – changes under discussion with differentiated effects – no fundamental change to overall framework 4 High operational efficiency and innovative solutions leading to outperformance 5 Strong post-tax earnings contribution from participations (included in EBITDA) innogy · company presentation · 1 August 2016 page 98

  84. Retail

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