German Wind Farm Disposal

6 September 2010

Renewable Energy Holdings plc

("REH" or the "Company")

Proposed disposal of German Wind Assets

and

Notice of General Meeting

Introduction

The board of directors of Renewable Energy Holdings plc (AIM: REH) (the "Board" or "Directors"), the AIM quoted investor and operator of European wind power, announces that the Company's wholly owned subsidiary, REH Global Limited, has today entered into a conditional agreement whereby, subject to the approval of the Company's shareholders (the "Shareholders"), REH Global Limited will dispose of its entire interests in Windpark Kesfeld Heckhuscheid GmbH & Co KG ("Windpark Kesfeld") and Windpark Kirf GmbH & Co KG ("Windpark Kirf") (together, the "German Wind Assets") to Allianz Renewable Energy Management GmbH ("Allianz") for a total net cash consideration of up to €39.8 million, comprising up to €37.8 million of Initial Consideration and up to €2.0 million of Deferred Consideration (the "Disposal"). On the date the Disposal closes (the "Closing") REH Global Limited shall provide two performance bonds totalling €1.0 million for the two year period following Closing, comprising €650,000 to serve as security for all warranty claims and other breaches of the sale agreement and €350,000 to serve as security for an indemnity granted by REH Global Limited to Allianz in respect of energy losses resulting from restrictions imposed upon Windpark Kesfeld or Windpark Kirf by planning authorities in Germany for breaches of noise levels stipulated in the relevant permits.

The Disposal

€30.4 million of the Initial Consideration will be used to pay down existing debt of the REH group (the "Group"), and the Board currently intends that the majority of the remaining proceeds of the Disposal, after expenses, will be re-invested in the Company's Kobylany wind farm project in Poland (the "Kobylany Wind Farm Project") (subject to, inter alia, sufficient debt finance becoming available to further develop the project, and which is currently being negotiated with a number of banks).

In addition, it is expected that the Disposal will free up approximately €1.2 million of working capital held within REH Global Limited (which is currently held in a debt service reserve account) to fund the business of the companies remaining in the Group immediately following completion of the Disposal (the "Retained Group").

The Disposal is deemed to result in a fundamental change to the Company's business for the purposes of Rule 15 of the AIM Rules and is therefore conditional, inter alia, on the approval of Shareholders being given at a General Meeting of the Company.

If Shareholders approve the Disposal, Closing and payment of the Initial Consideration is currently expected to occur by 30 September 2010.

Background to, and reasons for, the Disposal

REH funded the acquisition of the German Wind Assets and development of their businesses via debt facilities which assumed, inter alia, higher wind speeds than those which are currently being achieved and which were costed accordingly. As a consequence, the current wind speed regime compared with that projected by REH make the holding of the German Wind Assets less attractive to REH, given the Company's cost of debt.

The Board believes that the Company's development projects, being the Kobylany Wind Farm Project in Poland and Mynnydd y Gwynt in Wales (the "Development Projects"), should be the main focus of REH's activity going forward, due to the potentially superior economic returns they could provide. Accordingly, the Company has considered a number of options that would give REH the scale and scope to progress these projects and other similar opportunities, and accordingly has decided to recommend the Disposal.

It is the Board's revised strategy that in the future REH is to focus on investing in, developing and operating its other European wind assets, initially in Poland and, as available capital permits, in other opportunities identified by the Company. The Disposal is the Board's preferred method by which REH raises funds to progress the Development Projects.

In the year to 31 December 2009, the business operated by the German Wind Assets collectively made a segment loss before tax of £0.84 million on a turnover of £4.5 million. The audited net assets of the German Wind Assets as at 31 December 2009 were £12.95 million.

Current trading and strategy

Despite a strongly supportive political environment for renewable energy across Europe, the turbulent global economy and weak capital markets have resulted in the restriction of funding to small, but capital intensive, growth businesses such as REH.

As a result of the above, REH extended the original timetable envisaged for the development of the Kobylany Wind Farm Project. The Board was already carrying out a financial and strategic review of the Group and was identifying measures to ensure a more focused strategic approach to future growth, including the disposal of CETO (the wave energy technology enabling the production of zero emission freshwater and zero emission electricity) to Carnegie Wave Energy Limited ("Carnegie"), the disposal of its Bryn Posteg landfill gas operation and the disposal of the German Wind Assets to put the Group in a position to develop its pipeline of wind projects without recourse to further equity financing from Shareholders.

In line with this strategy, the Company completed the sale of CETO to Carnegie in December 2009 in exchange for 232,600,000 ordinary shares in Carnegie, and disposed of its Bryn Posteg landfill gas operation in Wales, in February 2010, for up to £2.75 million in cash.

Accordingly, notwithstanding the management of the Company's holding in Carnegie, the Board intends that the Retained Group's remaining resources, both in financial and personnel terms, will be concentrated on wind assets, both operational and developmental, in continental Europe and the UK. Further to this strategy, the Board is seeking to progress the Group's developmental wind projects, starting with the Kobylany Wind Farm Project in Poland and then its Welsh project, Mynnydd y Gwynt.

The Retained Group is trading broadly in line with the Directors' expectations and the Directors believe that, following the Disposal, the Retained Group will be well placed to progress the Development Projects.

Status of the Retained Group

The Disposal, combined with the discontinuation of the Company's direct obligation to meet CETO development costs and the cash proceeds from the sale of the Bryn Posteg landfill gas operation, are expected, in aggregate, to have a positive effect on REH's balance sheet prior to re-investment in Poland.

Accordingly, the Disposal will concentrate REH's interests in wind farms in the developmental stage with the objective of bringing them into operation in due course. Such development will be dependent, inter alia, on securing the necessary debt finance. The Company is currently in discussions with several banks to secure such funding in respect of the Kobylany Wind Farm Project.

Shareholder approval and General Meeting

The Disposal is deemed to result in a fundamental change to the Company's business for the purposes of Rule 15 of the AIM Rules and is therefore conditional on the approval of Shareholders being given at the General Meeting, which is to be held at 11.00 am on 23 September 2010 at the registered offices of the Company, being IOMA House, Hope Street, Douglas, Isle of Man IM1 1AP.

The Directors unanimously recommend that Shareholders vote in favour of the Disposal, as those directors who are also Shareholders have irrevocably undertaken to do in respect of their own beneficial holdings (which amount in aggregate to 528,500 ordinary shares of one penny each in the Company (the "Ordinary Shares"), representing approximately 0.76 per cent. of the issued voting share capital of the Company).

Utilico Limited and certain institutional Shareholders, who between them hold the beneficial interest in 37,063,091 Ordinary Shares, representing in aggregate approximately 53.24 per cent. of the issued voting share capital of the Company, have irrevocably undertaken to vote, or to have their nominees vote, in favour of the Disposal.

A circular and notice of General Meeting will be posted to Shareholders shortly and will be available for download on the Company's website at www.reh-plc.com.

Mike Proffitt, Chief Executive of REH, commented:

"The proposed disposal of the German Wind Assets demonstrates REH's commitment and ability to focus on realising value from its assets with a view to creating value upside for shareholders from its future pipeline of wind development projects in Poland and Wales."

- Ends -

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