BENEFITS OF COGENERATION

A cleaner and renewable energy technology.

Combined Heat and Power is the production of electricity by combustion of a fuel like natural gas, biomass, biogas or coal and the capture of generated thermal energy. Nearly 84% of COGEN units use natural gas.

Cogeneration is the use of a heat engine or a power plant to simultaneously generate both electricity and heat. In the separate production of electricity, some energy must be rejected as waste heat but in cogeneration this thermal energy is put to good use. By capturing the excess heat, cogeneration uses heat that would otherwise be wasted in a conventional power plant and converts it to useful electricity, heat or air conditioning.

A typical cogeneration system consists of an engine, steam turbine or a combustion turbine that drives an electrical generator. A waste heat exchanger recovers waste heat from the engine and/or exhaust gas to produce hot water or steam.

As a thermodynamically efficient use of fuel, cogeneration produces a given amount of electric power and process heat with 10% to 30% less fuel than it takes to produce electricity and process heat separately. As a result, less fuel is consumed to produce the same amount of useful energy thereby reducing fuel consumption and dramatically reducing pollution produced in the form of greenhouse gases.

BENEFITS OF COGEN VS. TRADITIONAL	COGEN	GRID
No Distribution Loss	No Loss	<5%>
Renewable - Recycle Heat	Yes	<15%>
Scalable to meet growing demands	Yes	No
Variable production	Yes	No

BENEFITS OF COGENERATION

Cogeneration Industry Outlook:

U.S. Domestic cogeneration currently represents over 3,364 sites and 85,184 megawatts (MW) of generating capacity, which is 8% of total U.S. generating capacity. The U.S. could generate about 20% of domestic electricity with heat that is currently wasted.

California has more than 776 cogeneration plants operating with capacity of about 9,130 MW; producing more COGEN power than any other state. The total viable market in California approaches 30,000 MW.

808 has targeted California and the Western United States as our initial geographic market. The total existing and potential market for CHP in the 200 KW to 1 MW size in those areas is 163,000 sites with 12,200 MW of generating capacity representing $12 billion of annual electricity revenue and $7 billion of heat and hot water revenue.

808's existing plants and primary target markets are sites with generation capacity from about 200 KW to 5 MW. These systems with capacity of less than 5MW account for 3.2% of total capacity (about 300 MW) and are more weighted toward commercial, institutional, lighter industrial and food facilities.

80% of the 2,000 MW of new capacity expected to come online by 2020 will be in the smaller sized facilities that produce less than 5 MW.

BENEFITS OF CHP GROWTH	2006	2030
Annual Energy Savings	85 GW	241 GW
Total Annual CO reduction	1,895 trillion Btu/yr	5,272 trillion Btu/yr
Cars Taken Off Road (Equivalent)	45 million	154 million

THE 808 INVESTMENT OPPORTUNITY

Through our experience, proprietary management and operations tech-nology, and our market positioning advantage in distressed COGEN assets, 808 has to date acquired over 50 COGEN plants secured through long term Energy Supply Contracts. We currently own and operate over 11 megawatts (MW) of power thereby reducing their users energy bills while providing efficiencies which reduce their carbon footprint.

With $15 million in capital already invested since inception, 808 currently has well over an additional $100 million worth of cogeneration and biogas projects in our pipeline. In addition, through our extensive network of relationships in the California energy markets, our demonstrated performance history in COGEN management and our strong reputation with utility regulators, we are being approached with new opportunities each week. All told, 808 Renewable Energy has over 300 MW of additional existing CHP plants targeted for future acquisitions.

Based on these current and foreseeable opportunities and with our initial build-out phase completed, 808 is focused on maximizing investor returns through our sustainable and scalable model. We are now accepting additional accredited investor capital of up to $50 million in total expansion stage capital from our existing and potential investor partners.

808's energy projects generate net income for our accredited investor partners through long term recurring revenue, monthly cash flow and pro-rata participation in profits from the sale of energy; as well as pass-thru of CHP specific Federal, State and utility company rebates and tax credits.