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DesignCamp 2011 Power Days Siemens and smart cities

Okt. 5th. 2011 John Finnich Pedersen

Š Siemens AG 2010. 2009. All rights reserved


Committed to profit and growth

Revenue by Sector Healthcare €12,4 billion

Revenue by region Cross-Sector Businesses

7,7 6% %

Germany

Asia, Australia 18% 18%

€4,8 billion

15% 15%

16% 45% 49% 29% 33%

Industry €34,9 billion

27% Americas

Energy €25,5 billion

Total Revenue Sectors and Cross-Sector Businesses

Revenue and employees 100.000

500

80.000

400

60.000

300

40.000

200

FY

Revenue in millions of euros 1985

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1990

1995

December 2010

Europe, CIS, Africa, Middle East (excl. Germany)

Location of customer

Key figures

Employees in thousands

20.000

40%

2000

2010

100

Continuing operations (in millions of euros)

FY2009

FY2010

Revenue New orders Income Free cash flow Employees

76,651 78,991 2,457 3,786 405,000

75,978 81,163 4,112 7,111 405,000

Corporate Communications © Siemens AG 2010. All rights reserved.


Innovation is our lifeblood

Major R&D investments

Major innovations

ƒ €3,846 billion in fiscal 2010, or 5,1% of revenue

ƒ Our patent position in fiscal 2010: Î Germany: No. 3 Î Europe: No. 2 Î USA: No. 13 ƒ Most recent innovations: Î Biograph mMR: World’s first integrated whole-body MR-PET for precise measurements of position, type and activity of tumors Î World’s most powerful gas turbine: With a 60-percent efficiency rating, the turbine drastically cuts fuel consumption and CO2 emissions Î Velaro high-speed train travels up to 350 kilometers per hour, consumes 0.33 liters of fuel per seat and 100 km

ƒ 30,100 R&D employees worldwide ƒ 18,000 software engineers ƒ 178 R&D locations in over 30 countries around the world ƒ 8,800 inventions in FY 2010 ƒ 57,900 active patents R&D spending in % of revenue 5,1% 5,1%

4,7%

FY2007

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4,9%

FY2008 FY2009 FY2010

December 2010

Corporate Communications © Siemens AG 2010. All rights reserved.


"Pictures of the future" Concept as basis for formulating a future strategi

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December 2010

Corporate Communications Š Siemens AG 2010. All rights reserved.


Strategic innovation planning

Scenarios for the sectors

Strategic vision

Influencing factors Individuals

Extrapolation via roadmaps Today’s business

ƒ Products ƒ Technologies ƒ Customer requirements

Retropolation out of scenarios ƒ New markets ƒ New customer requirements ƒ New technologies ƒ New business

Industry

Society Politics Economy

Energy Environment Technology

Healthcare

Customers Competition

Today

Short-term

Medium-term

Long-term

Time horizon (varies markedly across the different sectors)

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December 2010

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Megatrends shape our future

Urbanization ƒ 2007: for the first time in history, more people live in cities than in rural areas. ƒ Today 280 million people live in megacities (> 10 million residents) ƒ 2030: 60 % of the world’s population will live in cities ƒ Urban conglomerations contribute a high share of a nation’s economic output: Tokyo provides 40% of Japan’s GDP, Paris generates 30% of France’s GDP.

Demographic Change ƒ Average life expectancy worldwide will increase to 72 years in 2025 from 46.6 years in 1950. ƒ World population will grow from more than 6 billion now to 8 billion by 2025. ƒ 95% of the global population growth is taking place in developing countries. ƒ The 65+ generation will nearly double worldwide by 2030 (from 7% to 12%),

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December 2010

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Megatrends shape our future

Climate Change ƒ The average global surface temperature has increased by 0.76° C compared to the 18th century. ƒ 11 of the 12 years between 1994 and 2005 rank among the 12 warmest since weather observations began. ƒ Greenhouse gas emissions haven risen dramatically since industrialization. Today we face the highest CO2 concentration in the atmosphere for the past 350,000 years.

Globalization ƒ From 1950 to 2004, the volume of global trade has increased 27.5-fold. ƒ The number of global players has grown from 17,000 in 1980 to over 70,000 today. ƒ Ocean freight has increased over the past four decades from less than 6,000 billion ton-miles to over 27,500 billion ton-miles a year.

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December 2010

Corporate Communications © Siemens AG 2010. All rights reserved.


Megatrend challenges – Siemens' answers for an urbanizing world

Cities are centers of growth

€1,700 billion

ƒ Infrastructure spending amounts to €2 trillion* worldwide / year 300

ƒ Siemens-relevant market: about €300 billion

World population in billions 9,3 6,9 in Mrd. 70% 50% Cities Euro

2010

ƒ Cities account for 80% of greenhouse gas emissions

ƒ By 2050, about 70% of 300the world population will live 2050 1700 in cities

Siemens has the answers ƒ Energy: leading HVDC technology transmits power from remote energy sources to cities at low loss ƒ Building technology: "Performance Contracting" – energy savings of up to 40% finance investments in energyefficient building technology ƒ Security: complete solutions ƒ Mobility: full spectrum of mobility systems (Complete Mobility) ƒ Water: largest provider of products for every stage of water treatment ƒ Healthcare: world leader in IT solutions for healthcare, efficient processes in hospitals lower costs

* Calculations based on OECD data in „Infrastructure 2030“

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December 2010

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Future energy system: combined energy mix, energy effectivity and Smart Grid…

… in one integrated energy system

Fluctuating production from renewable energy

Central CSP provides basis eland heat production Display for CO2 emission

Central and decentral powerplants are managed in one integrated system

Wireless censors and intelligent meters for managing flexible power consumption

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December 2010

Micro power heat production in intelligent buildings

Parking spots for e-cars with chargesstations

Energy storage to compensate fluctuating production

Corporate Communications © Siemens AG 2010. All rights reserved.


London's environmental footprint is already comparatively low along some dimensions Values per year (2005 or most recent available before) London New York City

CO2 from buildings kg CO2/person

Stockholm

5,000

Tokyo Rome

CO2 from transport kg CO2/person

Municipal waste kg/person

2,500

1,000

CO2 from industry kg CO2/person

750

2.5

Air pollution kg of particle matter (PM10)/person

200 Source: Š McKinsey & Company 2008

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December 2010

Water m3/person

Corporate Communications Š Siemens AG 2010. All rights reserved.


Sustainable Urban Infrastructure – key findings for London 2025 Greenhouse gases 1

International targets for greenhouse gas reduction are achievable through technological levers without a significant change in lifestyle

2

The majority of technologies pay back the required up-front investment through energy savings

3

Around 75% of the abatement potential lies in the hands of individuals or businesses who make technological choices

4

The total investment required constitutes less than 1% of GVA

Water 5

Technologies for water demand reduction could achieve 20% savings by 2025

Waste 6

Given the high and rising landfill tax, alternative (and more sustainable) technologies become economically attractive

Source: Š McKinsey & Company 2008

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December 2010

Corporate Communications Š Siemens AG 2010. All rights reserved.


In London, international targets for greenhouse gas reduction are achievable through technological levers Mt CO2 Reduction* Percent

London emissions

45.1

Targets

47.0

-43.7

-12.5

-20.0

-30.0

-60.0

39.5 36.1 31.6 25.4 18.0

1990

2005

2025 after identified levers

2012 Kyoto 2020 EU

2025 UK

2025 Lond on

* Compared to 1990 emissions

Source: Š McKinsey & Company 2008

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December 2010

Corporate Communications Š Siemens AG 2010. All rights reserved.


The biggest contribution to London’s abatement potential comes from buildings Mt CO2

Cost < 0 EUR/t CO2* Cost > 0 EUR/t CO2* 1.8

47.0

45.2

10.6 9.2 1.4

2005

Changes to 2025 2025

Buildings

3.0 1.8 1.2

Transport

-19.8 2.5 1.4 1.1

Decentral energy

3.7 1.0 2.7

Central energy

25.4

2025 after levers

Identified levers Source: © McKinsey & Company 2008

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December 2010

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The majority of technologies pay back the required up-front investment through energy savings Greenhouse gas abatement cost curve for London 2025 (decision maker perspective) Abatement costs EUR/t CO2 2,200 2,000 1,800 1,600 1,400 Levers that pay back the required investment 1,200 1,000 800 13.4 Mt 600 400 200 0 -200 0

5

10

15

20

-400 New builds* Coal-to-gas shift Windows Floor insulation Biofuels Petrol engine efficiency package Lighting (commercial) Wind offshore Solid wall insulation Heat from existing Wind power onshore stations Lighting (residential) Heat recovery Electric appliances Optimisation of building controls Condensing boilers Loft insulation Gas engine CHP

Cumulated abatement potential Mt CO2 Source: Š McKinsey & Company 2008

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December 2010

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Around 75% of abatement potential lies in the hands of individuals or businesses who make technological choices Percent

Total: 19.8 Mt CO2

National level Examples: ƒ Biofuels ƒ Central electricity supply (grid mix)

City Examples: ƒ Public buildings ƒ Hybrid buses ƒ Traffic management

3

21

21 21 48 48

48

Businesses Businesses Examples: ƒ Lighting in commercial buildings ƒ Cooling displays ƒ Decentral energy (CHP) Source: © McKinsey & Company 2008

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December 2010

28

28 28

Individuals Examples: ƒ Buildings insulation ƒ Low-emission cars ƒ Efficient household appliances Corporate Communications © Siemens AG 2010. All rights reserved.


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