Financial Highlights:

CETO development payments of GBP2.79 million (2007: GBP0.75 million) made by Carnegie Corporation.

Group ended the year with cash balances of GBP6.5 million (2007: GBP7.1 million), following German project debt repayment of GBP2.6 million during the year.

New accounting treatment of CETO development payments from Carnegie Corporation, as announced on 27 February 2009, mean reported revenues in 2008 will be lower by the amount of the CETO license payments from Carnegie during the period of GBP2.79 million. This technical change in treatment advised does not however impact the funds invested in CETO’s development under the CETO licensing arrangements with Carnegie and therefore the progress of CETO towards commercial realisation.

Operational Highlights:

40.5 megawatt (MW) installed wind power capacity in Germany at two sites.

Full year production from the 8 MW project at Kirf, Germany.

Landfill gas in Wales business increased turnover by 83% to GBP0.51 million (2007: GBP0.28 million) from an increase in volume of electricity and a power purchase agreement.

A pipeline of commercial sites for CETO in the Northern Hemisphere have been identified by REH and its partner EDF Energies Nouvelles SA.

100 MW of new projects in Poland and Wales making encouraging progress.

Management team strengthened with appointment of Paris Mouratoglou, Chairman of EDF Energies Nouvelles SA as a NED and recruitment of a Business Development Director, Senior Project Engineer and a Science & Intellectual Property Manager.

Commenting on the results, Mike Proffitt, chief executive of the company, said 2008 has been another year of strong growth and development, utilising REH’s solid asset portfolio, in terms of project base and financial and human resources. We have enjoyed a full year of production from the 8 MW Kirf extension to our German Wind operations, increased production at our Welsh landfill gas facility, and our Polish projects are making good progress.

Our proprietary CETO wave energy technology is making excellent progress in the Northern and Southern Hemispheres, with the help of our partners Carnegie Corporation and EDF Energies Nouvelles SA.

“The Group starts the year in robust shape with generating assets covering our central cost base by some margin and continued sustained growth across our portfolio. We look forward to the coming year as a further period of growth for the business.”

Chairman’s Statement

Once again I am happy to be reporting positive results to the Group’s members. The year ended December 31, 2008 is the fifth financial statement I have reported on and each report has seen the Group growing in size and capability. This year I am pleased to report a growth in the Group’s revenues of GBP1.5 million and net assets of GBP5.2 million (GBP3.5 million and GBP8.6 million before the change in accounting policy explained in the chief executive officer (CEO)’s report, and more fully in Note 2). We have maintained the ability to cover our corporate costs with income generated by operating assets, and we have cash in the bank.

REH has continued to be the focus of Governments around the world and much emphasis has been placed on this sector in the UK and Europe. Whilst there can be no guarantee that Government policies will not change in the future, it is clear that to accomplish the various targets that have been set across the Kyoto member countries for carbon emission reductions, it will be necessary, especially in the UK, to see further support for the renewable energy sector. Recent announcements supporting this view are a two Renewable Obligation Certificate (ROC) incentive for marine technologies in UK waters followed by a six ROC incentive for marine technologies in Scotland.

Further legislative support across Europe for wind and solar power and recent news of subsidies for renewable energy in Poland, all bode well for us.

As reported by the CEO, the Group’s CETO wave energy technology appears to be now just months away from commercial demonstration. As with all new technologies some development risk remains at this stage, however, the Board consider that the CETO technology is robust and believes that, if successful, it represents an enormous opportunity for growth globally.

Many islands held hostage to imported heavy fuel oil, will see CETO as one of the few clean technologies available to them, and countries with extensive coast lines, such as the USA, will look to marine technologies to harness that vast natural resource.

The company is aware of the current challenges we are facing in terms of the global economy, and the knock on effect that downturns of this size and nature have on companies of all shapes and sizes. At REH, I believe we are well positioned to face these challenges. We have a Group with cash in the bank, no corporate debt, project facilities in place with Standard Chartered Bank, and operating assets producing positive cash flow. We believe it is companies like ours that are best placed to weather the storm such as this current economic crisis, and indeed to be able to act decisively as opportunities are created.