Tc Energy Corporation · TSX:TRP
Tc Energy — Investor Day (November 2022)
95 slides from Tc Energy's investor day presentation, Nov 29, 2022
Slide 1: TC Energy's 2022 Investor Day
WELCOME TO TC Energy's 2022 Investor Day
Slide 2: Forward-looking information and non-GAAP measures
Forward-looking information and non-GAAP measures Thi s presentation includes certain forward looking information, including but notlimited to,s tatements regarding the Corporation’s projected 2022- 2026 comparable EBITDA, expected cash flows, future financing options a va ilable i ncluding divestit
Slide 3: Safety and inclusion moment
2 0 2 2 I N V E S TO R D AY Safety and inclusion moment Tina Faraca President, U.S. Natural Gas Pipelines
Slide 4: Safety and the imperative of inclusion
S A F E T Y A N D T H E I M P E R AT I V E O F I N C L U S I O N Inclusivity helps build trust, so people feel psychologically safe to speak up, ask questions and safely perform their work A diverse and inclusive culture drives collaborative solutions and enhances performance. 4
Slide 5: Strategic overview
2 0 2 2 I N V E S TO R D AY Strategic overview François Poirier President and Chief Executive Officer
Slide 6: Today's agenda
Safety and inclusion moment Tina Faraca Strategic overview François Poirier Finance outlook Joel Hunter Today’s Break agenda U.S. & Mexico Natural Gas Pipelines Canadian Natural Gas Pipelines Stanley G. Chapman, III Bevin Wirzba Presentations Q&A – Natural Gas Pipelines 7:55 a.m. – 11:00 a.m. Break
Slide 7: Our objectives today
2 0 2 2 I N V E S TO R D AY Our objectives today Showcase Demonstrate the Provide a sustainable growth resiliency of our clearly defined in cash flows portfolio funding plan 7
Slide 8: Reaffirming our value proposition
TC ENERGY Reaffirming our value proposition Strong performance in 2022 The strength of our utility-like LONG-TERM VIEW DISCIPLINED APPROACH business model Strategic outlook is grounded in Adherence to well-established, fundamentals conservative risk preferences Our focus on safety and operational ex
Slide 9: A highly integrated North American footprint
S T R AT E G I C A D V A N TA G E A highly integrated North American footprint One of the largest natural gas networks spanning North America Connecting lowest cost basins to the largest Natural Gas Pipelines Liquids Pipelines demand markets Natural Gas terminals Liquids terminals 30 years of experi
Slide 10: Strategic outlook is grounded in fundamentals
LONG-TERM VIEW Strategic outlook is grounded in fundamentals Continued demand for natural gas and oil along with low-carbon sources of energy to provide unprecedented growth opportunities. 10
Slide 11: Strategy is grounded in fundamentals
2022-2050 NORTH AMERICAN ENERGY MIX Strategy is grounded in fundamentals 33% 31% 37% 36% 38% 38% 7% 10% 1% 5% 3% 6% 6% 5% 9% 8% 19% 8% Oil Natural gas Coal Nuclear Renewables & hydro Other(1) Resilience tested against a wide range of scenarios, including accelerated energy transition (1) Includes mo
Slide 12: Natural gas markets showing strength through 2050
N AT U R AL G A S F U NDA MENTALS Natural gas markets showing strength through 2050 Natural gas production by basin, North America Natural gas demand by sector, North America Bcf/d Bcf/d 150 LNG exports 120 Transportation 90 Hydrogen generation Appalachia 100 Other(1) 60 Haynesville Commercial 30 Mo
Slide 13: Emissions reduction benefits of coal-to-gas switching
N AT U R AL G A S F U NDA MENTALS Highlighting the emissions reduction A LOWER-CARBON FUTURE benefits of coal-to-gas switching • Natural gas emissions are approximately half that of coal in power generation Coal vs. natural gas emissions Coal retirements, North America • Switching has reduced lbs. C
Slide 14: North American oil production expected to remain robust
L I QU IDS F U NDA MENTALS North American oil production expected to remain robust RESILIENT SUPPLY • Canadian production expected to remain resilient Crude oil production, Global oil demand in the long run versus U.S. North America MMbbl/d MMbbl/d 120 20 ROBUST REFINING ACCESS • Providing direct ac
Slide 15: North American power demand continues to grow
P O WE R F U N DAME NTALS North American power demand continues to grow MULTIPLE RESOURCES NEEDED • Rising power demand will require an ‘all-of-the-above’ Power demand, North America Capacity additions & retirements, solution TWh CAGR 2030-2050 GW North America 8,000 1.3% CAGR 2022-2030 2,000 0.8% G
Slide 16: Hydrogen and CCUS to grow in North America
E N E RGY S O LUT IONS F U N DAMENTALS Hydrogen and CCUS to grow in North America LEVERAGING OUR FOOTPRINT Regardless of the pace of adoption for low-carbon energy solutions, TC Energy is • North America-wide footprint investing to align with evolving customer demand is a springboard for low- carbon
Slide 17: Expect to sanction $5+ billion of growth projects annually
R U N WAY F O R G R O W T H Expect to sanction $5+ billion of growth projects in each of the next several years Today Substantial suite of future opportunities USNG delivery market projects Coal-to-gas switching LNG Bruce Power Ontario Pumped Storage Other in-corridor growth Alberta Carbon GridTM $3
Slide 18: Capital allocation consistent with risk/return preferences
DISCIPLINED APPROACH Capital allocation consistent with risk/return preferences Expected 7-9% IRR Policy support Expected 3-5% dividend growth Market fundamentals Long-term contracted or rate-regulated Risk preferences met GHG profile Organizational capabilities Southeast Gateway Pipeline Gillis Acc
Slide 19: Balances sustainable dividend growth and reinvestment
C A P I TA L A L L O C AT I O N Balances sustainable dividend growth and reinvestment Our job is to prosecute our unmatched opportunity set, while aligning with our financial and human capacity. 19
Slide 20: Capital rotation is a core competency
C A P I TAL R OTAT I O N I S A C O R E C O M P ET ENC Y Expected goal through 2023: Raise $5 billion+ from the sale of discrete non-core assets and/or minority interests Considerations for Objectives capital rotation Proven track record • Accelerate deleveraging* • Valuation • Successfully executed
Slide 21: A decade of deliverability
L O O KI NG B A C K AT T C E N E R G Y ’S H I S TO RY SUCCESSFUL HISTORY OF CAPITAL ROTATION A decade of deliverability • Generated >$11 billion in D/EBITDA asset sale proceeds between 6.6x* 4.8x* 4.9x* 2017-2020 D/EBITDA multiple $Billions Sold Cartier Wind Sold Ontario natural g a s-fired power pl
Slide 22: Focused on supporting global climate goals
TC Energy targets NET ZERO BY 2050 Focused on supporting global climate goals 30% GHG emissions intensity reduction by 2030 Position to achieve net-zero GHG Abatements assessment 2022-2050 emissions from operations by 2050 Supporting global 70-80% climate goals Decarbonizing our consumption and lowe
Slide 23: Our 2022-2026E strategic priorities
Our 2022 – 2026E strategic priorities Enhance balance sheet Focus on Increase returns on our Decarbonize our business strength and flexibility project execution and assets through revenue and capitalize on operational excellence enhancements and cost low-carbon opportunities reductions Accelerate ou
Slide 24: Our team of energy problem solvers
Our team of energy problem solvers FRANÇOIS POIRIER JOEL HUNTER STANLEY G. CHAPMAN, III BEVIN WIRZBA COREY HESSEN President and Executive VP and Executive VP and Group Executive, U.S. Executive VP, Strategy and Executive VP and President, Chief Executive Officer Chief Financial Officer and Mexico Na
Slide 25: Finance outlook
2 0 2 2 I N V E S TO R D AY Finance outlook Joel Hunter Executive Vice-President and Chief Financial Officer
Slide 26: Financial strength and flexibility at all points of the economic cycle
RESILIENCE Financial strength and flexibility at all points of the economic cycle 26
Slide 27: Resilient value creation through multiple economic cycles
A UTILITY-LIKE BUSINESS MODEL Resilient value creation through multiple economic cycles Maintaining dividend growth Comparable EBITDA(1) 22 consecutive years of common share dividend increases Performance – 2000-2022E with 3-5% expected future growth per annum $Billions Ru s s ia- U k r ain e 10 war
Slide 28: 2022E Comparable EBITDA mix
S TA BL E A N D RE S I LIE NT C A S H F L OWS 2022E Comparable EBITDA(1) mix LONG-TERM Other – REGULATED – 67% CONTRACTED – 28% 5% U.S. Natural Gas Pipelines – 39% Canadian Natural Gas Liquids Pipelines – 13% Mexico Natural Pipelines – 28% Gas Pipelines – 8% • Long-term contracts • Take-or-pay, long
Slide 29: 2022-2026E outlook provides 6% comparable EBITDA CAGR
DISCIPLINED APPROACH Adherence to well-established, conservative risk preferences 2022-2026E outlook provides 6% comparable EBITDA(1) CAGR, deleveraging priorities and the ability to capitalize on future opportunities. 29 (1) Comparable EBITDA is a non-GAAP measure. See the forward-looking informati
Slide 30: A steadfast and consistent approach to our long-term strategy
R E A F F IR MING S T R AT EG IC P R I O R IT IES Our core principles A steadfast and consistent approach to our LONG-TERM VIEW long-term strategy Strategic outlook is grounded in fundamentals DISCIPLINED APPROACH Adherence to well-established, conservative risk preferences CAPITAL ALLOCATION Balanc
Slide 31: Fully sanctioned 6% comparable EBITDA CAGR
2 0 2 2 – 2 0 2 6 E C O M P A R A B L E E B I T D A (1) O U T L O O K Fully sanctioned 6% comparable EBITDA(1) CAGR $Billions 14 CAGR 12.5 Reflects current portfolio of high-quality, 12 6% secured projects expected to enter service 9.7 by 2026 10 8 ~95% from regulated and long-term contracted assets
Slide 32: Capital expenditure program delivering long-term value
2 0 2 2 – 2 0 26E C A P I TA L O U T L OOK Capital expenditure program delivering long-term value $Billions 12 10 9.6 9.5 1.8 >$7B funded 2.1 8 through capital 0.1 0.7 0.9 6.7 6.7 6.4 rotation 1.1 6 2.3 1.9 1.4 2.9 4 0.8 0.9 3.7 <$5B 0.8 accelerates 1.5 4.4 2.1 1.9 deleveraging 2 2.5 0.9 2.2 1.2 0.7
Slide 33: Optimally funding our capital program
2022 – 2026E OUTLOOK Optimally funding our capital program $Billions 60 3 3 3 50 3 Net long-term debt Commercial paper, and hybrids August 2022 equity KXL recoveries and 40 Capital 20 11 11 issuance and DRP other expenditures 36 30 Capital Funds expenditures 20 generated from operations( 1) 39 10 Di
Slide 34: Building a self-funding growth trajectory
2026E AND BEYOND Building a self-funding growth trajectory Ability to sustainably support a Illustrative example of self-funded model and a annualized figures* 3-5% dividend growth rate ~70% comparable 3-5% EBITDA(1 ) conversion annual Investing in high-quality growth Maintaining ~$2 growth projects
Slide 35: Prioritizing our balance sheet and deleveraging
OPTIMIZING AND MANAGING OUR DEBT PORTFOLIO Prioritizing our balance sheet and deleveraging 35
Slide 36: Capital rotation to accelerate deleveraging target from 2026
F I N A N CI A L S T RE N GT H A N D F L E X I BIL IT Y Capital rotation to accelerate deleveraging target from 2026 Top-tier credit ratings TransCanada PipeLines Limited credit ratings and outlook reaffirmed post-August 4, 2022 equity issuance Outlook results in debt-to-EBITDA BBB+ Baa1 below 4.75x
Slide 37: 2022-2026 Long-term debt maturity profile
BALANCED AND MANAGEABLE 2022 – 2026 Long-term debt maturity profile $Billions Strong and balanced debt 3.0 profile Low sensitivity to interest rate changes 2.0 ~85% of long-term debt is fixed rate 1.0 Average term of ~20 years to final maturity 0.0 2022 2023 2024 2025 2026 USD FX CAD 37 Average fore
Slide 38: Strong governance foundation with Board and Committee oversight
FURTHER EMBEDDING ESG ACROSS THE BUSINESS Supported by a strong governance foundation with Board and Committee oversight CAPITAL COMPENSATION FINANCING DISCLOSURE ALLOCATION Corporate scorecard $3 billion 5-year Climate and Aligned with includes 50% weighting Sustainability-Linked stakeholders leadi
Slide 39: Well positioned to deliver long-term shareholder returns
2023 OUTLOOK Well positioned to deliver long-term shareholder returns 39
Slide 40: 2023E Comparable EBITDA outlook and sensitivities
G R O W T H U N D E R P I N N E D B Y S U P E R I O R O P E R AT I O N A L P E R F O R M A N C E 2023E Comparable EBITDA(1) outlook and sensitivities Interest rate: Δ +/- 25 bps • Financial charges: $15MM Expected • EPS: ~$0.01/share to be ~5-7% Expected hig her Foreign exchange: Δ +/- $0.01 USD/CAD
Slide 41: Financial risks and levers
F I N A N CI A L M O D E L E R’S TO O L K I T Financial risks and levers Interest • Debt portfolio ~85% fixed rate; average term of 20 years to final maturity rates • Regulatory and commercial arrangements mitigate impact of rate movements • Expected normalized income tax rate in mid-to-high teens –
Slide 42: TC Energy's proven value proposition
D E L I V E RI NG L O N G- T ERM S H A RE H O L D ER VA L U E TC Energy’s proven value proposition Dividend growth outlook Impressive track record Significant growth Sustainability a key opportunities supported by strategic priority a robust funding plan 22 consecutive years of 12% average annual to
Slide 43: Break
BREAK W E W I L L R E S U M E S H O R T LY TODAY IS GIVING TUESDAY Visit the TC Energy Community Portal, make a donation to your preferred cause, and get a 3:1 match. Visit tcenergy.benevity.org/community
Slide 44: U.S. Natural Gas Pipelines
2 0 2 2 I N V E S TO R D AY U.S. Natural Gas Pipelines Stanley G. Chapman, III Executive Vice-President & Group Executive U.S. and Mexico Natural Gas Pipelines
Slide 45: Irreplaceable North American network
U . S . N AT U R AL G A S P I P ELI NES Irreplaceable North American network • Strong fundamentals driving opportunity-rich environment • Tracking to 6th consecutive year of record comparable EBITDA(1) and US$1.8 billion of capital in-service in 2022 • Expert team safely and reliably delivers ~27% o
Slide 46: A continental energy company
OU R EX PANSIVE F OOTP RINT A continental energy company TICKET SOUTH • Canadian Natural Gas Pipelines Synergies across geographies and businesses solidify and USNG together provide our role in North America’s energy landscape critical access to markets across 100Bcf/d North America 35% Largest natu
Slide 47: USNG comparable EBITDA outlook
U S N G 2 0 2 2 - 2 0 2 6 E C O M P A R A B L E E B I T D A (1) O U T L O O K Best-in-class network with traditional and transitional opportunities to grow Comparable EBITDA(1) growth derived from C$Billions secured capital program and asset 5.0 CAGR 4.8 optimization 5% 3.9 Strong fundamentals, soli
Slide 48: Strong demand supports near and long-term growth
U . S . N AT U R AL G A S F U ND AMENTALS Strong demand supports near and 2022 ENERGY THEMES long-term growth U.S. natural gas demand growth Total demand growth SECURITY 2021 - 2030 Bcf/d (incremental from 2021 at 91 Bcf/d) • Reinforces the importance and value 25 + 27% of stable infrastructure for
Slide 49: Strategic alignment with next wave of LNG
LNG OPPORTUNITIES ANR Strategic alignment with next wave of LNG Ha ynesville Columbia Gulf • Increasing LNG feedgas market share - as high as 35% by 2025 • Haynesville and Appalachia production are core to meeting Permian B a sin Louisiana demand • Gillis Access will feed Louisiana markets and next-
Slide 50: Strong alignment between fundamentals and asset footprint
S T R AT EG IC P O S IT ION Strong alignment between fundamentals and asset footprint Target-rich environment across multiple platforms LDC energy security Next-wave LNG Supply access Power generation & coal retirements Low-carbon & decarbonization solutions US$5B 12+ Bcf/d ~6-8x Recoverable mainten
Slide 51: Corporate strategy alignment and key takeaways
U.S. NATURAL GAS PIPELINES Corporate strategy alignment and key takeaways Showcase sustainable Demonstrate the Provide a clearly defined growth in cash flows resiliency of our portfolio funding plan • Tracking to record comparable EBITDA(1) • Highly contracted firm capacity • Project execution focus
Slide 52: TC Energía – Mexico Natural Gas Pipelines
2 0 2 2 I N V E S TO R D AY TC Energía Mexico Natural Gas Pipelines Stanley G. Chapman, III Executive Vice-President & Group Executive U.S. and Mexico Natural Gas Pipelines
Slide 53: Industry-leading position in a growing natural gas market
TC ENERGÍA U.S. imports Industry-leading position in a to Mexico growing natural gas market 45% 2030 1 Mexico gas • 30-year history with US$11 billion invested(1) demand • Critical infrastructure with exclusive strategic location 2 35% 2030 • Utility-like business model with stable, growing cash flo
Slide 54: Expecting comparable EBITDA to more than double
M E X I C O 2 0 2 2 - 2 0 2 6 E C O M PA R A B L E E B I T D A (1) O U T L O O K Expecting comparable EBITDA(1) to more than double C$Billions 2.0 Secured capital program 2022-2026 1.7 with a build multiple of 7x – 8x 1.5 CAGR 23% US$160 million incremental annual EBITDA from TGNH, exclusive of SGP
Slide 55: Strong alignment between fundamentals and policy
MEXICO’S VALUE PROPOSITION Strong alignment between fundamentals and policy 1 ECONOMIC GROWTH AND GROWING NATURAL GAS DEMAND • Stable economic outlook post-pandemic 1 Strong macro • Growing demand from manufacturing export industries fundamentals • CFE growth and modernization drives gas demand from
Slide 56: Applying learnings to enhance project execution
SGP MILESTONES SOUTHEAST GATEWAY Applying learnings to Q3 2022 TC and CFE Board FID enhance project execution Secured prime contractors TGNH provides …attributable to: operational flexibility and Q4 2022 reliability • Sur de Texas experience and learnings Commenced steel and concrete weight coat
Slide 57: Corporate strategy alignment and key takeaways
MEXICO NATURAL GAS PIPELINES Corporate strategy alignment and key takeaways Showcase sustainable Demonstrate the Provide a clearly defined growth in cash flows resiliency of our portfolio funding plan • US$160 million incremental annual • Prudent history of deploying capital and • Expected US$340 mi
Slide 58: Canadian Natural Gas Pipelines
2 0 2 2 I N V E S TO R D AY Canadian Natural Gas Pipelines Bevin Wirzba Executive Vice-President, Strategy and Corporate Development and Group Executive, Canadian Natural Gas Pipelines and Liquids Pipelines
Slide 59: Key investment characteristics
C A N A D IAN N AT U R AL G A S P I P ELI NES Key investment characteristics Utility-like business offers sustainable, long- term, predictable cash flowand earnings at all points of the economic cycle Disciplined growth underpinned by world-classsupply/demand fundamentals Critical component of a syn
Slide 60: Highly resilient and stable business
C A N A D IAN N AT U R AL G A S N E T I N C O ME A N D I N V ES TMENT B A S E O U T L OOK Highly resilient and stable business Net Income Average Investment Base $Billions $Billions CAGR Every dollar invested earns 1.2 24 1% 22.5 a return on and of capital 21.3 20 Capital efficient expansions suppor
Slide 61: Adaptable business model delivers through all points of the cycle
L O N G H I S TO RY O F L O W - RISK P RE D I CTABLE G RO WT H Significant resilience Adaptable business model delivers through following energy all points of the economic cycle disruptions $Billions Net Income Ongoing evolution in 1.0 service offerings Discretionary NGTL tight NGTL pricing CAGR gas
Slide 62: Significant investment to expand the reach of the WCSB
THE BACKBONE OF THE BASIN Significant investment to expand the reach of the WCSB Peak day NGTL System receipts NGTL and Mainline Investment Base NGTL reached a new record high of 14.3 Bcf/d in 2022 – $Billions We have grown our investment base by $9.5 billion since 2015 Bcf/d 2.3 Bcf/d higher than 2
Slide 63: Strategic asset footprint
O U T LO OK G RO UND ED I N F U N DAMENTA LS Strategic asset footprint West Coast LNG +2.1 Bcf/d Current sanctioned growth capital Resilient regulated business model will provide at least 4.1 Bcf/d of incremental capacity through 2026 helps insulate against inflation and Intra-basin counterparty ris
Slide 64: Capital expenditure approach 2022-2026E
Forecast capital program* C A P I TAL E X P E ND ITURE A P P ROAC H 2022-2026E Disciplined growth and spending ($Billions, sanctioned) • Over $11 billion in forecast growth, capacity, modernization and $3.7 $3.7 maintenance capital programs 2022-2026 $7.5 • Beyond the sanctioned $1 to $2 billion per
Slide 65: Connecting Western Canada's natural gas to the world
C O A S TA L G A S L I N K Connecting Western Canada’s natural gas to the world Wilde Lake Compressor Facility WCSB is a world-class source of sustainable, secure natural gas Revised agreements strengthen partnership with LNG Canada, provide project certainty Project is overall 80% complete 10% equi
Slide 66: Corporate strategy alignment and key takeaways
CANADIAN NATURAL GAS PIPELINES Corporate strategy alignment and key takeaways Showcase sustainable Demonstrate the Provide a clearly defined growth in cash flows resiliency of our portfolio funding plan • Utility-like model offers stable earnings • Long-life assets well-positioned to • Exceptional c
Slide 67: Q&A Natural Gas Pipelines
Q&A N AT U R AL G A S P I P ELINES
Slide 68: Break
BREAK W E W I L L R E S U M E S H O R T LY TODAY IS GIVING TUESDAY Visit the TC Energy Community Portal, make a donation to your preferred cause, and get a 3:1 match. Visit tcenergy.benevity.org/community
Slide 69: Liquids Pipelines
2 0 2 2 I N V E S TO R D AY Liquids Pipelines Bevin Wirzba Executive Vice-President, Strategy and Corporate Development and Group Executive, Canadian Natural Gas Pipelines and Liquids Pipelines
Slide 70: Leveraging our footprint to connect resilient oil supply to robust markets
L I Q U IDS S T R AT EG IC P O S IT ION Leveraging our footprint to connect resilient oil supply to robust markets WCSB oil supply (MMbbl/d) 6 Highly strategic assets providing access 5 to the largest refining markets in the 4 world, totaling ~14 MMbbl/d capacity 3 2 1 Stable supply source from long
Slide 71: Tailor-made customer solutions
PARTN ER OF CHOI CE Tailor-made customer solutions Premium Liquids Pipelines value proposition market access Safe and reliable delivery of energy 96% Customer Delivery Shortest transit time experience optionality Industry-leading quality preservation path to the Gulf Coast Access to premium
Slide 72: A year of maximizing capacity and progress
2022 AND BEYOND A year of maximizing capacity and progress Optimizing Keystone System to date Safe and sustainable operations • Resulting in increased reliability and unlocking additional capacity Liquids Pipelines System operating MMbbl/d capacity factor % +7% 0.7 Operational excellence 100 92 85 •
Slide 73: Significant free cash flow and option value
L I Q U I D S P I P E L I N E S 2 0 2 2 – 2 0 2 6 E C O M PA R A B L E E B I T D A (1) O U T L O O K Significant free cash flow and option value $Billions 2.0 Driven by strong market fundamentals, strategically positioning for the future CAGR 1.5 4% Focus on operational excellence CAGR 1% 94% of Key
Slide 74: Corporate strategy alignment and key takeaways
LIQUIDS PIPELINES Corporate strategy alignment and key takeaways Showcase sustainable Demonstrate the Provide a clearly defined growth in cash flows resiliency of our portfolio funding plan • Recontracting and commercial • Industry-leading contracted portfolio • Stable earnings and strong free cash
Slide 75: Power and Energy Solutions
2 0 2 2 I N V E S TO R D AY Power and Energy Solutions Corey Hessen Executive Vice-President and President, Power & Energy Solutions
Slide 76: Strong base business growing via customer-led opportunities
1c POWER AND ENERGY SOLUTIONS Strong base business growing via 2 3 customer-led opportunities 1a 1b 7 Total existing capacity of ~4,300 MW 6 • Portfolio of low-cost baseload generation 4 • Underpinned by >92% long-term contracts • ~75% emission-less generation 4 Acquired ~1,200 MW of renewable power
Slide 77: Solving customers' energy transition challenges
POWER AND ENERGY SOLUTIONS Nuclear power generation Solving customers’ energy • Bruce Power transition challenges Runway of customer-driven opportunities Other mature power generation Strategic alignment • Wind • Solar • Leverage vast energy infrastructure network • Cogeneration • Manage risk throug
Slide 78: Capitalizing on low-carbon opportunities
POWER AND ENERGY S OLUTIONS 2 0 22-2026E C O M P A R A B L E E B I T D A (1) O U T L O O K Capitalizing on low-carbon opportunities $Billions Backlog of unsanctioned capital provides 2.0 incremental growth to our outlook Continuous growth opportunities, CAGR leveraging competitive footprint 10% CAGR
Slide 79: Bruce Power: a key asset in a low-carbon future
BRUCE POWER A key asset in a low-carbon future “There’s no transition that works without nuclear, full stop.” - Mark Carney, United Nations Special Envoy for Climate Action and Finance TC Energy has a 48.4% ownership stake in Bruce Power Safe Track record of safe, reliable operations for over 45 yea
Slide 80: Critical to meeting Ontario's growing electricity demand
BRUCE POWER Critical to meeting Ontario’s growing electricity demand and decarbonization goals ONTARIO’S ENERGY LANDSCAPE • Energy requirements increase Ontario Energy Adequacy Outlook sharply starting in 2029 due to TWh (without continued availability of resources with expired contracts) increasing
Slide 81: Extending life and increasing capacity without new infrastructure
BRUCE POWER Extending life and increasing PAST AND FUTURE INVESTMENT capacity without new infrastructure • TC Energy has invested $2.3 billion into Bruce Power since 2015 • $2.3 billion planned to finish Major Component Replacement (MCR) program and Asset Management MCR6 and MCR3 and fund the progre
Slide 82: Bruce Power continues to create enduring value
BRUCE POWER STRONG RETURN ON INVESTMENT Continues to create enduring value • Capital requirements largely funded through distributions Low double-digit returns, backed by an investment-grade counterparty and a long-term contract through 2064 • Increasing free cash flow potential following completion
Slide 83: Ontario's biggest battery, storing carbon-free electricity
O N T A R I O P U M P E D S T O R A G E (1) Ontario’s biggest battery, storing 2023-2025 Environmental assessment carbon-free electricity process A 1,000 MW reliable, proven technology to complement current supply and satisfy future demand designed with rate payers in mind 2025 • Pumped hydro is the
Slide 84: Progressing power decarbonization for internal and external customers
VIRTUAL POWER PURCHASE AG REEMENTS ( vP PA) 2021 Progressing power decarbonization for Issued RFIs for wind, solar and internal & external customers battery storage capabilities in U.S. Powering the Keystone Pipeline System with renewable energy could abate ~1.5 million tonnes of CO2e annually 2021-
Slide 85: Earning incremental returns through decarbonization solutions
VIRTUAL POWER PURCHASE PROJECT DEVELOPER AG REEMENTS ( vP PA) Earning incremental returns Illustrative example through decarbonization of vPPA structure solutions EXTERNAL CUSTOMERS ISO + KEYSTONE PIPELINE *Renewable energy credits Providing environmental benefits • Renewable power solution to decar
Slide 86: First in Canada, premium decarbonization solution
24x7 CARBON-FREE POWER PRODUCT 2021 First in Canada, premium Service opportunity announced decarbonization solution Carbon-free power product in Alberta offers a fixed price for a fixed volume of power and all environmental attributes 300 MW: 2021-2022 • Pioneering a combined wind, solar and long-du
Slide 87: Capturing opportunities across the hydrogen value chain
HYDROGEN HUB MODEL Capturing opportunities across the hydrogen value chain H2 A comprehensive hydrogen strategy enables us to build upon our power and gas businesses and continue to be the partner of choice H2 H2 feedstocks H2 production + H2 transport + H2 end users CO2 capture H2 dispensing One of
Slide 88: Crossfield Hydrogen Hub
CROSSFIELD H Y D R O G E N H U B (1) 2023-2025 Leverage existing gas storage site for H2 Environmental assessment low-carbon hydrogen production hub process Incumbent position and expertise enables access to markets with high barriers to entry • Supports Provincial, Federal and industry GHG reductio
Slide 89: Alberta Carbon Grid
A L B E R T A C A R B O N G R I D (1) A world-scale carbon transportation 2021 and sequestration solution ACG partnership announced • Collaboration between TC Energy and Pembina Pipeline • Safe, reliable, cost-effective decarbonization solution for • cross-industry emitters 2022 ACG proposal submitt
Slide 90: Strategic partnerships generate significant value
CUSTOMER-DRIVEN SOLUTIONS Strategic partnerships generate significant value Strong relationships with suppliers, customers and internal partners • Strategic partnerships enable opportunities across the value chain • Growth opportunities driven by customer demand H2 • Existing customer relationships
Slide 91: Corporate strategy alignment and key takeaways
POWER AND ENERGY SOLUTIONS Corporate strategy alignment and key takeaways Showcase sustainable Demonstrate the Provide a clearly defined growth in cash flows resiliency of our portfolio funding plan • Significant opportunity set to capture • Bruce Power — emission-less • Joint ventures, partnerships
Slide 92: Q&A Liquids Pipelines and Power & Energy Solutions
Q&A Liquids Pipelines and Power & Energy Solutions
Slide 93: Final Q&A and closing remarks
Final Q & A CLOSING REMARKS
Slide 94: Appendix A – Business segment results GAAP measure
Appendix A – Business segment results GAAP measure M I L L IONS OF DOL L ARS Year ended December 31 2021 Segmented earnings Canadian Natural Gas Pipelines 1,449 U.S. Natural Gas Pipelines 3,071 Mexico Natural Gas Pipelines 557 Liquids Pipelines (1,600) Power and Storage 628 Corporate (46) Total segm
Slide 95: Appendix B – Net cash provided by operations GAAP measure
Appendix B – Net cash provided by operations GAAP measure M I L L IONS OF DOL L ARS Year ended December 31 2021 Net cash provided by operations 6,890 Increase in operating working capital 287 Funds generated from operations 7,177 Specific items: Current income tax expense on Keystone XL asset impair