Second Party Opinion On The Green Finance Framework Of Kaz Green Energy Llp

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEThe Company's mission is environmentally safe and sustainable development for the long termand preservation of a favourable environment for current and future generations.The main activities are: production of electricity using solar energy, the creation of a complex for the reception, disposal of all types of waste andturning it into energy, processing and disposal of non-hazardous waste, the production of heat and electric energy, and other.By 2023, the Company plans to implement the projects "Balkhash Solar Power Plant with a capacityof 100 MW" and "Kengir Bioelectric Power Plant with a capacity of 5 MW". This list is subject tochange; the update will be formalised as an addition to the GFF.1. "Solar power station "Balkhash" with a capacity of 100 MW"Project implementation period: 12 months, starting from the 4th quarter of 2020.Implementation is planned in 2 stages the first stage of 50 MW is planned for July 2021; the second stage of 50 MW - in December 2021.Main project indicator: electricity generation 165,610.11 MWh per year on average over 15 years.Place of project implementation: the Republic of Kazakhstan, Zhezkazgan city.2. Bioelectric power station "Kengir"Stages of the project: expected start date of construction 2021.The main indicator of the project: the use of a unique innovative technology for processingsolid waste using a pyrolysis thermochemical system to obtain the main product - syntheticgas with subsequent generation of electricity.Place of project implementation: Republic of Kazakhstan, Karaganda region, Zhezkazgan city,v. Kengir.Realising the responsibility for its activities and its impact on the environmental situation, as wellas accepting the need to reduce greenhouse gas emissions, the Company decided to adhere tothe recommendations specified in the ICMA's GBP and GGLP.ENVIRONMENTAL POLICYThe Company has implemented the GFF, which was approved by the Supervisory Board's decisionof the "KAZ GREEN ENERGY" (of November 26, 2020). The Company's GFF was adopted toformalise the approach to raising funds through green financing instruments and using them toimplement acceptable projects that meet the goals and principles of the Company inimplementing environmentally friendly projects. The GFF provides for the use of green financinginstruments presented in different currencies, for different periods with different conditions,including covenants, in accordance with the commercial terms agreed between theIssuer/Investor/Lender.www.greeninvest.kz6

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEThe GFF is based on the ICMA's GBP and GGLP.The Company intends to adhere to the following four key elements of the GBP and GGLP for eachgreen financing instrument and the management of the monies raised through them:1.2.3.4.Use of ProceedsEvaluation and selection processManagement of ProceedsReportingAccording to the Company's GFF, it applies to the implementation of projects for the core businessof the Company, in particular, but is not limited to the on the construction and launch of a solarpower plant and bioelectric power plant.Also, the Company has implemented the Environmental and Emissions Policies, according to whichit designates its active position in the fight against global warming.USE OF PROCEEDSThe Company declares that the proceeds from green financing instruments will be directedexclusively to financing or refinancing eligible projects (eligible assets) that bring specificenvironmental benefits and reduce environmental impact, and can be measured by quantitativeand qualitative indicators.Under eligible projects following the GFF, the Company accepts projects that fall under thefollowing categories: renewable energy sources (including production, transmission, equipment and products);energy efficiency (for example, energy efficiency in new and renovated buildings, energystorage, district heating, smart grids, equipment and products);pollution prevention and control (including projects to reduce atmospheric emissions,control of greenhouse gases, restore soil, prevent pollution, minimise pollution, processwaste, efficiently process waste into electricity, produce value-added products fromwaste and as a result of processing and related to the specified areas environmentalmonitoring);environmentally friendly transport (for example, electric, hybrid, public, railway, nonmotorised, multimodal transportation, infrastructure for environmentally friendlyvehicles and reduction of harmful emissions);adaptation to climate change (including information support systems such as climatemonitoring systems and early warning systems);environmentally efficient and/or adapted products of a non-waste economy, productiontechnologies and processes (such as the development and implementation ofenvironmentally friendly products, eco-labelling or environmental certification,economical packaging and distribution).www.greeninvest.kz7

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEEVALUATION AND SELECTION PROCESSESAccording to the Company, the implementation of the GFF is monitored by the Committee forGreen Projects, which is a collegial body. Decisions of the Committee for Green Projects aresubject to execution by all structural divisions, branches and representative offices of theCompany (Divisions). The work process of the Committee for Green Projects is described in theRules of Work of the Committee for Green Projects of the "KAZ GREEN ENERGY" LLP. Consideringthat at the time of this review, the Company's organisational structure lacks an ecology divisionand the position of an environmental specialist - the Company has provided confirmation of theinvolvement of an external consultant for environmental support of the project "Solar Power Plantin Balkhash with a capacity of 100 MW" represented by the PC "AIFC Green Finance Center" Ltd.Promising projects are submitted to the Committee for Green Projects, which checks for: a description of the project and implementation plan to achieve a specific environmentaleffect (quantitative and qualitative indicators) from the performance of the project;certificates, examinations, licenses and other documents confirming compliance with thenecessary standards or requirements;conclusions on the subject of the project's green from the internal/external environmentalexpert.If the project is recognised as meeting the criteria and the GFF, it is accepted for implementation.MANAGEMENT OF PROCEEDSThe GFF states that the proceeds from green financing instruments would be reflected in a specialsub-account, which will track the compliance of projects with acceptable categories. TheManagement of Proceeds process is described in detail in the Regulation on accounting for greenfinancing instruments of the "KAZ GREEN ENERGY" LLP and the Rules of work on Committee forGreen Projects of " KAZ GREEN ENERGY " LLP.The Committee for Green Projects of the "KAZ GREEN ENERGY" LLP will quarterly monitor the totalamount of eligible assets in the sub-account to ensure that it is equal to or exceeds the totalamount of proceeds received from green financing instruments. If for any reason the total amountof assets on the Company's sub-account is less than the total amount from the attracted greenfinancing instruments, the Company will retain the unallocated amount in cash or liquid securitiesunder the standard liquidity management policy of the Company until the number of eligibleassets becomes equal the amount from the attracted green financing instruments.If for any reason, previously accepted as an acceptable asset, by the decision of the Committeefor Green Projects of "KAZ GREEN ENERGY" LLP will be recognised as unacceptable, the Companyintroduces a process for adjusting the list of assets.www.greeninvest.kz8

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEREPORTINGThe Company states it will disclose information on the use of proceeds from green financinginstruments, areas of investment and the impact of activities on the environment on an annualbasis on its official website https://kge.kz in the manner specified in the Regulations on Disclosureof Information of "KAZ GREEN ENERGY" LLP.The reporting will include, but not be limited to, the following information:Green Bonds Proceeds Distribution Report Net proceeds received from each green bond; The cumulative amounts of funds allocated for each eligible asset; Balance of retained earnings at the end of the reporting period.Report on the distribution of funds for green financing within the framework of received greenloans Attracted funds for each green loan; The aggregate amounts of funds committed for each eligible asset; Balance of unallocated funds at the end of the reporting period: investments inany cash form, in the form of bank deposits and any other format of availablecurrent financial assets, and other.Report on the distribution of funds for other green financial instruments Attracted funds for each other green financial instrument; The aggregate amounts of funds committed for each eligible asset; Balance of unallocated funds at the end of the reporting period: investments inany cash form, in the form of bank deposits and any other format of availablecurrent financial assets, and other.Environmental impact report Volumes of generated electricity; Reduction of greenhouse gas emissions; The volume of processed solid waste.3. ASSESSMENT OF COMPANY'S GREEN FINANCE AND ENVIRONMENTAL POLICIESIn this section, we describe the assessment of the GFF and other relevant documents of theCompany for compliance with the GBP and GGLP under the Green Investment Group Second PartyOpinion Methodology. The information used for these purposes was obtained through directinteraction with the Company.OVERALL ASSESSMENT AND DETERMINATION OF GREENNESS LEVELThe Company confirmed that the use of proceeds would be directed towards the implementationof environmental projects, in particular, but not limited to planned projects for the constructionand launch of a solar power plant and a bioelectric power plant. Categories of funded projectsthrough green financing instruments comply with the GBP and GGLP and have an environmentalwww.greeninvest.kz9

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEeffect. The processes of project evaluation and selection, management of proceeds alsocorrespond to the key elements of the GBP and GGLP. Reporting on the use of proceeds and theexpected environmental impact is provided on an annual basis and is subject to publication on theofficial website of the Company for public access.Opinion on the Compliance/Non-Compliance of the GFF of the Company with the GBP and GGLPBased on the assessment of the criteria for meeting the threshold indicators, we determined thatthe Company's GFF meets the "mandatory" and partially additional criteria and confirm thecompliance of the "KAZ GREEN ENERGY" LLP GFF with the GBP and GGLP.Opinion on assigning a degree (rating) of greenness from "Excellent (High)" to "Poor (Low)"According to the results of the analysis, as well as according to the "Map for assigning a level ofgreenness", we determined the degree (rating) of greenness as "Excellent (High)" - "KAZ GREENENERGY" LLP shows an excellent level of management, distribution of proceeds, project selection,quality of borrowed funds management, reporting and disclosing information on ongoing projectsof environmental importance.Greenness DegreeExcellent (High)Weighted AverageDescription4.65The company shows an excellentlevel of management, allocation ofmonies raised, project selection,quality of allocation of moniesraised management, reporting anddisclosure of ongoing projects ofenvironmental importanceASSESSMENT BY THE CRITERION "USE OF PROCEEDS"The Company confirmed that the use of green financing instruments proceeds would be directedto a project "Solar power station "Balkhash" with a capacity of 100 MW".Main project indicator: electricity generation 165,610.11 MWh per year on average over 15 years.In addition, the Company and its shareholders have a successful experience in implementing asimilar project for the construction of 10 MW solar power plants in Zhezkazgan. Currently, theCompany is implementing projects for the construction of a 100 MW solar power plant inBalkhash, and the construction of a 5 MW Bioelectric power plant in Zhezkazgan.www.greeninvest.kz10

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCEThe implementation of these projects and, in general, the Company's activities are aimed atreducing greenhouse gas emissions, obtaining electricity from renewable sources, processing solidwaste into energy, which corresponds to the acceptable categories of projects in accordance withthe GBP and GGLP. Also, it should be noted that the Company's activities comply with the declaredSDGs.IndicatorScore 90% of the funds allocated forthe implementation offinancing/refinancing of greenprojects that bringenvironmental benefits and areevaluated by the company interms of compliance with thecategories of eligible projects inaccordance with the GBP forqualitative and/or quantitativecharacteristics5Compliance of the category ofprojects according to the GBP renewable energy sources(including production,transmission, equipment andproducts); pollution prevention and control(including projects to reduceatmospheric emissions, control ofgreenhouse gases, restore soil,prevent pollution, minimisepollution, process waste, efficientlyprocess waste into electricity,produce value-added productsfrom waste and as a result ofprocessing and related to thespecified areas environmentalmonitoring); adaptation to climate change(including information supportsystems such as climate monitoringsystems and early warningsystems); environmentally efficient and/oradapted products of a non-wasteeconomy, production technologiesand processes (such as thedevelopment and implementationof environmentally friendlyproducts, eco-labelling orenvironmental certification,economical packaging anddistribution).Compliancewith thethresholdvalueДаWeightedestimateaccording tothesignificanceof thecriterion 45%2.25ASSESSMENT BY THE CRITERION "PROCESS OF EVALUATION AND SELECTION OF THE PROJECT"The strategy, policy and goals of the Company comply with the GBP and GGLP and allow for athorough analysis of decision-making processes. The Supervisory Board of the Company approveswww.greeninvest.kz11

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCE"KAZ GREEN ENERGY" LLP's GFF, Environmental Policy, Energy and Emissions Policy, and Rules ofWork of the Committee for Green Projects which are posted on a website https://kge.kz. Theprocesses of evaluation and selection of green projects are described in the GFF of "KAZ GREENENERGY" and "Rules of Work of the Committee for Green Projects". The project evaluation andselection process also comply with the GBP and GGLP. Monitoring the implementation of the GFF,the Environmental Policy and the Policy regarding energy and emissions is carried out by theCommittee for Green Projects, which is a collegial body. The structure of the Company's GreenProjects Committee is formed by an odd number (at least three) from among the employees of"KAZ GREEN ENERGY" LLP, at least one representative of the Kazakhmys Power Projects B.V. andat least one independent expert. The Company informed the involvement of the PC "AIFC GreenFinance Center" Ltd. as an external consultant for environmental support of the project "SolarPower Plant in Balkhash City with a capacity of 100 MW," whose representative will also be amember of the Company's Committee for Green Projects. The Rules of Work of the Committeefor Green Projects define the operating principles, powers of the Committee for Green Projects,processes for selecting green projects, project selection criteria, maintaining a register of "EligibleAssets" and monitoring "Eligible Assets". The Committee for Green Projects decides on thequalification of "Eligible/Not eligible asset" based on the submitted documents and theinternal/external environmental expert's opinion. A project that meets the qualification "EligibleAsset" is approved by the Executive Body and is included in the list of eligible assets for furtheraccounting on the "Green Bonds" or "Green Loans" subaccount. There are also procedures formaking a decision on the placement of the unused balance of proceeds from green bonds prior tothe appropriate selection of eligible projects.IndicatorMandatory Indicators1. The company's strategy, policy and goals comply with the GBP and GGLP and allow for athorough analysis of decision-making processes for the selection of projects that correspond tothe categories of green projects2. Disclosure of the main methodologies and assumptions used in determining the complianceof projects with categories of green projects3. Availability and disclosure of descriptions of green projects, current and/or anticipated(planned) for implementationOptional Indicators4. Attracting an independent qualified party to decide on the selection of projectscorresponding to the categories of green projects5. The existence of procedures for the selection of suppliers/partners to take into account theirattitude to the environment and the environmentThreshold ComplianceWeighted score by the significance of the criterion - Evaluation of the criterion "4", the weightof the criterion 20%Score1111Yes0.8ASSESSMENT BY THE CRITERION "MANAGEMENT OF PROCEEDS "The GFF stipulates that Management of Proceeds will be carried through a special sub-account.The Company described the details of the accounting process through a special subaccount in thewww.greeninvest.kz12

SECOND PARTY OPINION ON THE GREENFRAMEWORK OF "KAZ GREEN ENERGY" LLPFINANCERegulations for accounting for green financing instruments. In accordance with these documents,the disposal of these funds will be carried out under the supervision of the Committee on GreenProjects and following the intended purpose of attracting green financing. The Company alsoannounced that the temporarily unused funds from the financing instruments would be placed inliquid instruments in accordance with the Company's generally accepted money managementpolicy. In particular, the proceeds will be used for the implementation of the project for theconstruction and commissioning of the Balkhash solar power plant and the bioelectric power plantin Zhezkazgan. A positive aspect of mitigating the risk for the targeted compliance of the use andrevenue management is that the Company will monitor the compliance of eligible assets with theGBP and GGLP on a quarterly basis, and, if necessary, make adjustments to the data on thesubaccount. Therefore, we believe that the revenue management score is consistent with the GBPand GGLP. The engagement of an independent audit is not provided for by the GFF; however, theCompany states that in the event of changes in

SECOND PARTY OPINION ON THE GREEN FINANCE FRAMEWORK OF "KAZ GREEN ENERGY" LLP Head office: Republic of Kazakhstan, 010000, Nur-Sultan, 19. Imanov str., office 415B Branch in AIFC: Republic of Kazakhstan, 010000, Nur-Sultan, 37 Mangilik El ave. No. 1 Republic of Kazakhstan, 010000, Nur-Sultan, 55/22 Mangilik El ave., FinTech, office 233