Frontier Energy Limited · ASX:FHE
Frontier Energy — Non-Deal Roadshow (May 2024)
22 slides from Frontier Energy's roadshow presentation, May 14, 2024
Slide 1: Clean energy to help fill Western Australia's growing supply gap
Clean energy to help fill Western Australia’s growing supply gap For personal use only Non-Deal Institutional Roadshow ASX: FHE OTCQB: FRHYF May 2024
Slide 2: Disclaimer
Disclaimer FORWARD LOOKING STATEMENT Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from those expressed or implied by such forward-looking information, including risks associated with invest
Slide 3: Building an independent, WA focused renewable energy company
Building an independent, WA focused renewable energy company CAPITAL Stage One DFS complete Strategy aligned to Federal and 120MW solar / 80MW (4 hr) battery State governments’ renewable STRUCTURE For personal use only energy and emissions targets Final Investment Decision mid-2024 446m Shares on is
Slide 4: Energy transition in WA is already seeing higher energy prices
Energy transition in WA is already seeing higher energy prices What is the energy transition? Monthly WA Wholesale Electricity Price4 For personal use only • The change in the way energy is supplied and consumed as we move towards net zero (decarbonisation) 220 Energy Prices in WA in 2023 • Energy (
Slide 5: Accessing existing Energy Network Connections is the major issue for the energy transition
Accessing existing Energy Network Connections is the major issue for the energy transition To build a renewable energy project you need For personal use only • Large, flat, unpopulated land areas • Strong, consistent environmental conditions (sun and wind) • Access to energy network connections (pow
Slide 6: Poised to become one of Western Australia's largest standalone integrated renewable energy projects
Poised to become one of Western Australia’s largest standalone integrated renewable energy projects Waroona Renewable Energy Project For personal use only • 120km south of Perth in Waroona, WA • Stage One – 120MW solar with 80MW 4-hour battery • Strategy and size provided lowest technical risk and a
Slide 7: Multiple revenue streams, potential increase in a rising market
Multiple revenue streams, potential increase in a rising market Strong forecast average revenue of $74m per year over the first 5 years $80 Reserve Capacity Payments (RCP) – $27.1m (36% of revenue) For personal use only $0.300 • Unique to WA – not in any other Australian jurisdiction $70 FCESS Energ
Slide 8: Why is WA different? Reserve Capacity underpins development
Why is WA different? Reserve Capacity underpins development Reserve Capacity Mechanism (RCM) Reserve Capacity Payment1 For personal use only • RCM is unique to WA, not available in the Eastern States (NEM) 330,000 • Trade-off for lower maximum energy price in WA compared to NEM prices 310,000 299,00
Slide 9: Energy Sales – Battery enables arbitrage to maximise revenue
Energy Sales – Battery enables arbitrage to maximise revenue Energy sales and storage strategy – January 120 $180 Increase electricity price while minimising risk of curtailment Battery For personal use only charges $160 100 • WA has the most sunlight hours in the country and one of the $140 highest
Slide 10: Debt financing to provide up to 70% of development costs
Debt financing to provide up to 70% of development costs Debt Process Debt Financing process advanced to Stage Two For personal use only • Debt terms for renewables energy projects are typically more attractive (duration and interest rates) compared to other industries (eg: mining) • Long-life, low-
Slide 11: Strategic partnership to assist in funding and expansion
Strategic partnership to assist in funding and expansion Strategic Partnership For personal use only • The Company received multiple unsolicited approaches from a range of major groups throughout 2023 • Leading Australian advisory firm Barrenjoey is acting as corporate advisor in connection with exp
Slide 12: Frontier's path to production
Frontier’s path to production BUILDING A SCALEABLE RENEWABLE ENERGY HUB For personal use only Near-term contributor to Major growth potential in Strategy aligned to Federal WA renewable energy an unconstrained section and State governments’ strategy of the grid energy and emission targets Milestone
Slide 13: For more information contact
For personal use only For more information contact Adam Kiley CEO +61 8 9200 3428 akiley@frontierhe.com ASX:FHE frontierhe.com ASX: FHE OTCQB: FRHYF frontierhe.com ASX:FHE / OTCQB: FRHYF | 13
Slide 14: Management Team
Appendix 1 – Management Team For personal use only Renewable energy solutions for Western Australia ASX:FHE / OTCQB: FRHYF | 14
Slide 15: Electricity price forecasts and revenue
Appendix 2 – Electricity price forecasts and revenue1 Battery 180 28 Battery price and revenue 160 26 $/MWh (real 2024) For personal use only $m pa (nominal) • The Base Case battery price forecast is ~$150/MWh (close to 24 Spot), with the Stress Test scenario ~$120/MWh. 140 22 • Early volatility due
Slide 16: Price forecasts and revenue – RCP and LGC
Appendix 3 – Price forecasts and revenue – RCP and LGC RCP 330 30 RCP price and revenue 280 28 $/MWh (real 2024) For personal use only $m pa (nominal) 26 • The BRCP has been set at $230,000 per MW for 2026/271 230 24 • As the market is forecast to be in deficit, an additional 22 180 30% premium is a
Slide 17: Low operating costs ensure long term sustainable profitability
Appendix 4 – Low operating costs ensure long term sustainable profitability • Once constructed, renewable energy projects are typically always profitable (over the course of a year) due to their: For personal use only • Low operating costs • Reliability of production • Limited additional capital dev
Slide 18: Large Generation Certificates (LGCs) beyond 2030
Appendix 5 – Large Generation Certificates (LGCs) beyond 2030 The Federal Government has released a consultation paper on green certificates to replace LGCs beyond 2030 Renewable Energy Guarantee of Origin (REGO) certificates: proposed Key attributes of each certificate design • Existing attributes
Slide 19: WEM compared to the NEM
Appendix 6 – WEM compared to the NEM Wholesale Electricity Market National Electricity Market (WEM) (NEM) For personal use only ~7GW >50GW Installed capacity (MW) (+2GW rooftop solar) (+20GW of rooftop solar) Annual operational demand ~18TWh ~190 TWh Peak operational demand 4GW 36GW • Separate energ
Slide 20: Waroona Solar Farm/BESS expected to see robust MLFs
Appendix 7 – Waroona Solar Farm/BESS is expected to see robust MLFs over the forecast horizon, due to its well- connected surrounding network Central scenario WA network augmentations MLF for Waroona Solar Farm/BESS – Aurora Central For personal use only • Waroona Solar Farm/BESS’ generation MLFs ar
Slide 21: Renewable and battery projects for the SWIS
Appendix 8 – Renewable and battery projects for the SWIS WA renewable energy projects with announced development plans1 – 476MW new generation capacity so far announced, while 1,200MW to be closed by 2029. 1,335MW battery storage is planned to firm up renewables Project Forecast production Size Owne
Slide 22: Synergy has more than 2GW of thermal capacity today
Appendix 9 – Synergy has more than 2GW of thermal capacity today but has announced closure dates Synergy coal and gas plant capacity, and coal plant retirements1 Coal closure schedule For personal use only • State-owned Synergy is the largest participant in the WEM and is expected to decarbonise in