value through sustain- able management As of May 2019 Disclaimer - - PowerPoint PPT Presentation

Delivering long-term value through sustain- able management

As of May 2019

RWE AG | A responsible investment | May 2019

Disclaimer

Page 2

This document contains forward-looking statements. These statements are based

• n the current views, expectations, assumptions and information of the management,

and are based on information currently available to the management. Forward-looking statements shall not be construed as a promise for the materialisation of future results and developments and involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those described in such statements due to, among other things, changes in the general economic and competitive environment, risks associated with capital markets, currency exchange rate fluctuations, changes in international and national laws and regulations, in particular with respect to tax laws and regulations, affecting the Company, and other factors. Neither the Company nor any of its affiliates assumes any obligations to update any forward-looking statements. All figures regarding the renewables business are based on pro forma combined innogy and E.ON publicly available data. The implementation of the transaction is still subject to conditions, including merger control clearances.

RWE AG | A responsible investment | May 2019

Company overview and strategic outlook

1

ESG performance

2

External recognition

3

AGENDA

Page 3

Environmental Social Governance <> <> RWE in sustainability indices and rankings

RWE AG | A responsible investment | May 2019 Page 4

1 Company overview

& strategic outlook

Security of energy supply & sensible environmental management at the heart of RWE

RWE AG | A responsible investment | May 2019

RWE at a glance

Company overview and strategic outlook 1

Page 5

RWE’s net generation capacity1  Leading European power generator  Efficient and flexible power plant portfolio  Strong global trading business  Ongoing transformation into a leading renewables player Key facts

Note: Figures may not add up due to rounding differences. | 1 Net installed generation capacity excl. innogy as of 1 January 2019. | 2 Converted to full-time positions. Workforce at 2018 year- end excl. innogy. | 3 2018 EBITDA for RWE stand-alone. | 4 Power generation 2018 excl. innogy. | 5 End of fiscal year 2018. | 6 Including units in security reserve.

36.6 GW

2.8 10.36 6.5 14.1 0.3 2.7

Lignite Hard coal Renewables Gas Pumped storage, other Nuclear

15,556 employees2 167 TWh generated power4 €1.5 bn adj. EBITDA3 €11.7 bn market cap5

18% 78% 1% 3%

8.6 GW 4.8 GW Netherlands/ Belgium 22.5 GW

12% 46% 13% 19% 11%

Germany UK

3%

41% 51% 5%

RWE AG | A responsible investment | May 2019

RWE is reshaping its portfolio by transforming into a leading integrated renewable & conventional power generator

Operating business Financial portfolio > On 12 March 2018 RWE and E.ON agreed to an extensive swap

• f assets and participations involving RWE’s stake in innogy

> Formation of leading power producer in Europe with highly complementary combination of renewable and conventional generation > Attractive contribution of E.ON and Kelag stakes to RWE’s financial portfolio

Additions to RWE portfolio from transaction (closing of complete transaction expected end of 2019).

Stake in E.ON (16.7%) Stake in Amprion (25.1%) Stake in Kelag (37.9%) European Power Renewable Energy

Respective business areas from E.ON and innogy E.ON stakes in nuclear power stations Gundremmingen (25%) and Emsland (12.5%)

Lignite & Nuclear

innogy’s gas storage business

Supply & Trading

Page 6

Company overview and strategic outlook 1

Strategic outlook

RWE AG | A responsible investment | May 2019

RWE’s prospering strategic outlook determined by transforming into Europe’s #3 renewables player

Installed renewable capacity in Europe1 Pro forma combined renewables capacity2

Page 7

Company overview and strategic outlook 1

1 Bloomberg New Energy Finance, as at 31 Dec 2018. 2 As at 31 December 2018. Pro rata view. Excludes RWE’s own renewable capacity. Excluding renewable portfolio of E.DIS and 20% in Rampion.

>

• No. 3 renewables player in Europe with well-balanced portfolio and strong position in U.S. onshore

wind market >

• No. 2 offshore wind operator globally with 2.5 GW2 in operation and 0.5 GW2 under construction

> Strong development pipeline in attractive growth markets and scope for efficiencies

20% 24% 5% 4% 4% 36% 7%

Germany UK Iberia Benelux Italy US RoW

9.1 GW

Pro forma combined

RWE AG | A responsible investment | May 2019

Highly complementary renewables & conventional gene- ration portfolio is cornerstone for secure energy supply

1 RWE stand-alone plus E.ON’s and innogy’s renewables businesses.

Lignite Hard coal Nuclear Gas Renewables Other

8.3 2.8 7.3 10.3 Firm and flexible capacity

>80%

Low CO2 generation capacity

>60%

Leading European generator with diversified and balanced generation technologies De-risking of portfolio with >60%

• f low CO2 generation capacity

Leading provider of reliable and flexible generation capacity to balance intermittent production

• f renewables

Opportunity to extract value from enlarged portfolio through leading commercial asset

• ptimisation platform

Pro forma combined electricity generation capacity1 (as of 1 January 2019)

Page 8

Company overview and strategic outlook 1

10.3 6.5 2.8 14.1 9.3 2.7

45.7 GW

RWE AG | A responsible investment | May 2019

RWE stand-alone – Outlook for 2019

FY

2018

FY

2019e

Slight increase (a.o. IFRS 16)

• Adj. depreciation
• Adj. taxes
• Adj. EBITDA

Stable development expected

• Adj. net financial result

Decline post call of hybrid in March 2019

• Adj. minorities & hybrid
• €0.6 bn
• €0.1 bn

€1.5 bn

• €0.2 bn
• €0.1 bn

€1.2 bn – €1.5 bn Stable development expected

• Adj. net income

€0.6 bn €0.3 bn – €0.6 bn Dividend (per share) €0.80 €0.70 Management target

Page 9

Company overview and strategic outlook 1

€2.3 bn Net debt Significantly above 2018

RWE AG | A responsible investment | May 2019 Page 10

ESG performance

RWE committed to long-term sustainable value creation

2

RWE AG | A responsible investment | May 2019

Sustainable Management creates value and provides

• ur license to operate

ESG performance 2

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We understand sustainable management as an integral part of our strategy and operations by which we contribute to the companies success. We belong to the UN Global Compact and support the UN Sustainable Development Goals Company Culture of Integrity & Appreciation Climate Protection Environmental Protection & Natural Conservation Supply Chain Standards & Resources Community Engagement Security of energy supply & critical infrastructure

CR creates value

Our Corporate Responsibility (CR) focus areas

RWE AG | A responsible investment | May 2019

Climate protection and biodiversity are focal points

• f our environmental policies

Emissions Compliance (environmental) Energy efficiency Biodiversity/ Recultivation Waste management

ESG performance 2

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> RWE’s Biodiversity Policy exceeds statutory regulations > No major environmental accidents > Investment in low-carbon technologies, e.g. CCGTs, batteries > Group-wide environmental management system based on ISO 14001 > 100% coverage for environmental management in 2018 > No environmentally relevant incidents in 2018 > Comprehensive waste management in accordance with the regulations for reuse, recycling, recovery or disposal > Commitment to reduce CO2 emissions in line with European and national greenhouse reduction targets to support the UN climate goals > Target to reduce CO2 emissions in core markets by 55 to 65 million tonnes by 2030 vs. 2015

Environmental performance

RWE AG | A responsible investment | May 2019

RWE’s significant CO2 reductions aligned with European and national climate goals

ESG performance 2

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RWE’s reduction path for CO2 emissions in core markets1 – our target before Commission recommendations

1 Referring to RWE stand-alone portfolio, excluding Mátra in Hungary and Denizli in Turkey. Figures do not include a potential impact on the generation portfolio as a result of

recommendations from the German Commission on Growth, Structural Change and Employment.

In million tonnes

Transfer of 1.5 GW of lignite to stand-by reserve and final shut-down after 4 years Conversion of Dutch hard coal plants to biomass co-firing Closure of Weisweiler power plant (1.8 GW) at end

• f Inden mine by 2030

Disposal and closure of coal plants, e.g. Bergkamen, Gersteinwerk

140 180 60 80 160 100 120 2012 2015 2018 2030 ... And beyond

• 32.6%

Reduction target1: 55 – 65 million tonnes vs. 2015 (equiv. 40 – 50%)

Before coal phase-out recommendations by Commission

(…)

RWE AG | A responsible investment | May 2019

Strategic ambition to further expand future renewables portfolio

ESG performance 2

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In

• peration

Under construction,

• exp. COD 2019

Under construction,

• exp. COD 2020

Under construction,

• exp. COD 2021

Total

9.1 0.7 0.6 11.0

Capacity in operation and under construction for the years 2019 – 20211 GW, pro rata

1 Pro forma combined renewables capacity as at 31 December 2018. Pro rata view. Excluding renewable portfolio of E.DIS and 20% of Rampion.

Source: innogy and E.ON.

> Attractive project pipeline of 1.9 GW under construction with expected commissioning in the years 2019 to 2021 > Additional projects with short-term FID of ~3 GW under development with potential commissioning date by 2021 > Total combined medium-/long-term development pipeline of more than 10 GW

2 coastal projects 371 MW West of Pecos 100 MW Clocaenog Forest 96 MW Morcone 57 MW Mynydd Y Gwair 33 MW Bad á Cheò 27 MW Other 18 MW Australian PV 349 MW Scioto Ridge 242 MW Other 12 MW Triton Knoll ~508 MW Nysater 95 MW

0.6

RWE AG | A responsible investment | May 2019

Various low carbon pilot projects in the pipeline, with focus on new technologies

Heat storage Waste Sector coupling – power-to-x projects > Assessment of power-to-heat technology

• Potential for temporary

fuel replacement in heat and steam generation for district heating or industrial processes > Assessment of application project at Lingen CCGT

• Installation of 40 MWth

electric boiler might debottleneck grid in tight situations

ESG performance 2

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> Assessment of power-to-gas technology

• Hydrogen as a storage

medium for energy produced from renewables sources > Assessment of pilot project at Lingen within the ‘GET H2’ hydrogen initiative

• Construction of a 105

MW power-to-gas pilot project > Recycling of materials “back to feedstock”

• Conversion of

(household) waste into base chemicals including hydrogen > Via an innovative line-up of existing technologies > In joint cooperation with the chemical industry in the Netherlands (project FUREC) > Conversion of coal-fired power plants into thermal storage power plants

• Steam production

based on coal-burning replaced by steam production with heat from liquid-salt storage

• Storage charged with

heat generated by sun and wind > A joint pilot project ‘StoreToPower’ in the Rhenish lignite area

RWE AG | A responsible investment | May 2019

Biodiversity footprint for recultivation shows big increase in ecology

Responsible recultivation with the objective of reinstating the development potential of the landscape while taking account

• f the typical conditions of the surrounding environment

Major building blocks are reforestation, creating agricultural land, structuring new habitats for nature conservation and protecting species More than 22,000 ha so far recultivated in the Rhenish lignite mining area, thereof more than 7,700 ha of woods, forests and green belts RWE’s quality of recultivation proven by conservation success: five landscape protection areas located in recultivated areas have been designated under legislation Recultivated areas have an equivalent diversity of species to those in high-value reference habitats in North Rhine-Westphalia – surveys of wildlife and fauna in the recultivated areas showed more than 700 plant and 2,200 animal species with some 430 species on the endangered list

ESG performance 2

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RWE AG | A responsible investment | May 2019

Awareness of social responsibility to provide safe and fair working conditions

ESG performance 2

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Secure energy supply & security management Diversity & employee relations Corporate volunteering Supply chain & compliance (socio-economic) Occupational health & safety

> Central management functions include security management > Aim to effectively protect

• perations from cyber attacks

> Suppliers vetted on environmentally and socially relevant criteria > Principles of United Nations Global Compact are constituent element

• f contractual relationships

> Annual compliance training for employees > ‘RWE Active On Site’ programm for employee engagement > Projects for integrating vulnerable groups into society, improving environment and sustainable development > Share of women at RWE (without innogy) increased from 10% to 11% in 2018; proportion in management positions ~15% > LTIF (Lost Time Incident Frequency) for RWE (without innogy) of 2.2 in 2018; target to reduce to 1.8 by 2019 > Health ratio of 93.5% in 2018

Social performance

RWE AG | A responsible investment | May 2019

Promotion of hard coal supply chain standards

Overview of hard coal supply for RWE power plants Drive for responsible hard coal procurement

> Founding member of Bettercoal to improve in producer countries mining and working conditions and reduce environmental impact > In 2018 further six on-site assessments > The three largest Colombian producers have been audited:

• Drummond, site-assessment, January 2019
• Cerrejón, site-assessment, July 2018
• Prodeco, site-assessment, August 2018

> Additional site visits to local mines by RWE representatives, e.g. as an observer of the site assessment of Cerrejón in July 2018 > All members integrate the Bettercoal assessment results into their procurement processes

Hard coal supply countries (2018) 8.1 million tonnes

Russia 42.4% Colombia 2.2% USA 23.5% South Africa 6.1% Other 1.7% Germany 23.1% UK 1.0%

Imported coal

ESG performance 2

Page 18

RWE AG | A responsible investment | May 2019

> Engagement in external networks (e.g. ENEI1) increases outward orientation & provides input on best practice diversity standards > ‘Total Equality’ certificate with a top score of 84 out of 100 received in 2018 > Regular Diversity Week and other events at several RWE locations to increase awareness > Work-life employee benefits (e.g. family & health care solutions, employee discounts, retirement benefits)

Ambitious targets and programmes to support equal opportunities and diversity

Increase women in 1st and 2nd management level to 30% and 20%, respectively (2018: 29% and 19%) by 20222 > Ensure female talent is found and developed, e.g. Female Talent Programmes > Enable development into executive positions, e.g. Executive Mentoring Programme and FidAR3 – ‘Women onto Supervisory Boards’ > Encourage women in technical careers, e.g. ‘Girls Days’, MINT4 initiative & mentoring Maintain a balanced age structure and age-appropriate employment > Training and apprenticeship programmes for young and senior employees > Participation and support of young professional networks, e.g. ‘Young Energy Professional Forum’ Enhance diversity with regards to ethnic origin and nationality > International internal job-market ensures cross-border placement opportunities > Close alignment of Diversity Office with HR Marketing to ensure diversity friendly recruiting processes Group-wide initiatives and networks to enhance the focus on diversity topics (gender, age, cross-culture) Gender Age Cross-culture & Internationality

1 ENEI: the Employers Network for Equality & Inclusion. | 2 Targets for RWE AG (excluding subsidiaries). | 3 Women’s association (Frauen in die Aufsichtsräte). | 4 MINT: Mathematics,

Informatics, Natural sciences and Technology.

ESG performance 2

Page 19

RWE AG | A responsible investment | May 2019

‘RWE Active On Site’ supports social engagement

• f employees

Customised opportunities > Within the scope of HR development measures > To support team building and broaden employee skills > Socially-oriented projects and activities improving the environment and sustainable development > To increase presence in our regions Strategic goals > Promotion of social responsibility through employee commitment > Development of employees’ skills through volunteering > Improvement of employee loyalty and motivation, strengthening the employer brand > Illustrates organizational values in action

ESG performance 2

Page 20

RWE AG | A responsible investment | May 2019

Stringent governance supports achievement

• f strategic goals

Governance performance ESG and HSE1 governance Management remuneration Governance structure & diversity at Supervisory Board

> Covered by the Corporate Responsibility and HSE department, directly reporting to RWE AG Executive Board > Regular training mandatory for all employees to sharpen awareness of Health, Safety and Environment > Two tier governance structure > Diverse & experienced Supervisory Board > Target quota for female members of Supervisory Board fulfilled > No conflicts of interests reported > Executive Management remuneration with fixed and variable components > Short-term bonus linked among others to ESG targets > Total compensation capped at ~164% ESG performance 2

Page 21

1 HSE: Health, Safety and Environment.

RWE AG | A responsible investment | May 2019

Diverse and experienced Supervisory Board fully fulfils competence requirements

1 In line with German Corporate Governance Code, only those employee representatives are defined as dependent who have an additional relationship with RWE AG,

exceeding the employment contract between the employee representatives and an RWE Group company. Due to minor shareholding municipal shareholders are considered independent under the German Corporate Governance Code.

ESG performance 2

Diversity at Supervisory Board

Experience profile of the Supervisory Board members covers all target areas as defined in the competence profile for the composition of the Supervisory Board

Experience of Supervisory Board members

* Incl. financial expert serving as chair of audit committee Gender Independency Length of membership Target of 6 female Supervisory Board members achieved Target of 12 independent Supervisory Board members exceeded1 Target of maximum membership of 15 years exceeded by one Supervisory Board member

Male Female Independent <3 years 3 – 6 years 7 – 9 years >9 years

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Competence profile Public sector Managerial experience Co-determination Utility sector Financial audit* International utility sector Accounting

      

RWE AG | A responsible investment | May 2019

Executive Remuneration system consists

• f three components

ESG performance 2

54% (max. 180%) 80% (max. 200%) 30% (100%) 30% (fixed) 30% (fixed) 40% (100%) 30% (fixed) Bonus > Based on economic performance of company and collective and individually achieved goals including corporate responsibility criteria > Paid after end of fiscal year; no retention Strategic Performance Plan > Long-term, share-based compensation scheme > Conditional on achievement of earnings indicator > Linked to performance of RWE shares > Personal investment obligation > Malus clause in case of infractions by Executive Board members

~30%

Minimum remuneration

100%

Budget remuneration

~164%

Maximum remuneration

Page 23

Annual salary > Fixed compensation may also include non-cash and

• ther remuneration, e.g. use of company car

RWE AG | A responsible investment | May 2019 Page 24

RWE in sustainability ratings and rankings

External recognition

3

RWE AG | A responsible investment | May 2019

RWE participates and receives recognition in leading sustainability ratings

1 ISS scale: the lower, the better.

Environmental score1: 3, Social: 2, Governance: 2 C+ (from A+ to D-) D (Climate), C (Water) 58 out of 100 above-average rating in all sub categories

Eurozone 120 Index constituent

Rankings 3

Page 25

AA (from AAA to CCC)

ESG Rating 3,3 (Percentile Rank 58) above-average rating in sectoral comparison

71 out of 100

Rating / evaluation

44 out of 100 (12th out of 28 utilities)

RWE AG | A responsible investment | May 2019

Sustainability along the value chain

120 years

Suppliers RWE Customer

We source responsibly We produce safely for people and the environment We provide a secure energy supply

Contribution to SDGs and Rankings 3

Page 26

RWE AG | A responsible investment | May 2019

Your contacts @RWE Investor Relations

Contribution to SDGs and Rankings 3

Page 27

Financial Calendar Important Links

Annual and Interim Reports & Statements http://www.rwe.com/ir/reports Investor and Analyst Conferences http://www.rwe.com/ir/investor-and-analyst-conferences IR presentations & further factbooks http://www.rwe.com/ir/presentations IR videos http://www.rwe.com/ir/videos Corporate Responsibility Reporting / CR report http://www.rwe.com/ir/cr-report

Contacts for Institutional Investors & Financial Analysts Contact for Private Shareholders

Gunhild Grieve Head of Investor Relations

• Tel. +49 201 5179-3110

gunhild.grieve@rwe.com Martin Vahlbrock Tel.: +49 201 5179-3117 martin.vahlbrock@rwe.com

• Dr. Burkhard Pahnke

Tel.: +49 201 5179-3118 burkhard.pahnke@rwe.com Lenka Zikmundova Tel.: +49 201 5179-3116 lenka.zikmundova@rwe.com Jérôme Hördemann Tel.: +49 201 5179-3119 jerome.hoerdemann@rwe.com Susanne Lange Tel.: +49 201 5179-3120 susanne.lange@rwe.com Sabine Gathmann Tel.: +49 201 5179-3115 sabine.gathmann@rwe.com ADR programme available Further information on our homepage RWE shares/ADR Contact for ADR-holders at BNY Mellon shrrelations@cpushareownerservices.com +1 201 680-6255 (outside from the US) 1-888-269-2377 (within the US) 14 August 2019 Interim report on the first half of 2019 14 November 2019 Interim statement on the first three quarters of 2019 28 April 2020 Annual General Meeting 04 May 2020 Dividend payment 12 March 2020 Annual report 2019