Capital Power Corporation · TSX:CPX

Capital Power — 2016 Peters & Company Energy Conference

15 slides from Capital Power's conference presentation, Sep 15, 2016

  1. Slide 1: 2016 Energy Conference

    2016 Energy Conference September 15, 2016 Bryan DeNeve Senior VP, Finance & CFO Capital Power

  2. Slide 2: Capital Power overview

    Capital Power overview  Growth-oriented North American IPP with ownership interest in 18 facilities in Canada and the U.S. totaling more than 3,200 MW  ~700 MW of owned generation in advanced development in AB and under construction in Kansas  Proven operating, development & construction expertis

  3. Slide 3: Alberta Climate Leadership Plan: Compensation for early phase-out of coal

    Alberta Climate Leadership Plan Compensation for early phase-out of coal  Meetings with government-appointed coal facilitator are on-going that focus on the transition away from coal-fired generation by 2030  Facilitator tasked with presenting options that will strive to maintain the reliability o

  4. Slide 4: Alberta Climate Leadership Plan: Compensation

    Alberta Climate Leadership Plan Compensation  A component of compensation for early retirement could be the ratio of reduced asset life to the current remaining life multiplied by Net Book Value (NBV)  NBV of our coal assets is ~$2 billion at end of 2015  Remaining life of our coal units are 139

  5. Slide 5: Alberta Climate Leadership Plan: Renewables RFP process

    Alberta Climate Leadership Plan Renewables RFP process & maintenance of AB market design  Alberta Electric System Operator (AESO) tasked with developing and implementing a Renewable Electricity Program (REP) to add additional renewable generation capacity by 2030 in concert with the retirement of c

  6. Slide 6: Alberta opportunity set

    Alberta opportunity set Significant investment required over the next 14 years  ~$30 billion  4,200 MWs in renewables to replace retirement of coal units with balance in natural gas and other to meet demand  Capital Power well-positioned with our existing power sites, development and construction

  7. Slide 7: Alberta market forecasts

    Alberta market forecasts Current low power price environment  Oversupply in the market  Lower demand from weak AB economy  Low natural gas prices Expected uplift in power prices  Expected recovery in demand growth  Moderate increase in natural gas prices (2)  Pass-through of higher environment

  8. Slide 8: AB commercial baseload hedging profile

    AB commercial baseload hedging profile  Alberta Commercial baseload positions: 2017 2018 2019 As of date Mar Jun Mar Jun Mar Jun 31/16 30/16 31/16 30/16 31/16 30/16 % sold forward 100% 100% 50% 54% 34% 44% Avg. contracted Mid-$40 Mid-$40 Low-$50 Low-$50 Low-$50 Low-$50 prices(1) ($/MWh) Avg. forwar

  9. Slide 9: Improving contracted EBITDA

    Improving contracted EBITDA(1,2,3) Substantial expansion in contracted EBITDA from 2012 to 2016 $450 $400 $350 $300 } Shepard & K2 Wind ($M) $250 $200 } 3 wind projects Beaufort Macho Springs K2 Wind Shepard $150 PD&N Halkirk Quality Wind $100 Island Generation North Carolina $50 Kingsbridge 1 Genes

  10. Slide 10: Strong financial coverage

    Strong financial coverage Operating margin(1) to financial obligations(2) and dividends(3) 150% 140% Contracted + merchant ($70/MWh) 130% 120% Contracted + merchant (Forwards(4)) 110% Contracted + merchant ($40/MWh) 100% Contracted margin 90% Minimum AB power prices required to cover financial 80% o

  11. Slide 11: Financial strength

    Financial strength Strong balance sheet and investment grade credit rating  Investment grade credit ratings by Agency Ratings Outlook S&P and DBRS S&P BBB- / P-3 Stable  Debt-to-capital ratio remains below DBRS BBB / Pfd-3 (low) Negative long-term target of 40% - 50% Debt to total capitalization C

  12. Slide 12: Growth opportunities – Canada & U.S.

    Growth opportunities – Canada & U.S. 1 Wind Natural Gas Solar Acquire or develop contracted opportunities across North America and consider merchant opportunities in Alberta 12

  13. Slide 13: Current growth projects

    Current growth projects Genesee 4&5 (Alberta)  Joint venture partners with ENMAX to develop, construct, own, and operate the 1,060 MW natural gas-fired combined cycle facilities  8-year tolling agreement with ENMAX for 50% of CP’s share of the output  Full notice to proceed decision contingent on

  14. Slide 14: Attractive value proposition

    Attractive value proposition  Excellent existing operations  Sustainable and growing dividend  Significant growth opportunities  Best positioned for Alberta power price recovery • Young and diverse fleet • Strong track record of operations and trading • Development & construction expertise to bu

  15. Slide 15: Investor Relations Contact

    Investor Relations Contact Randy Mah 10423 101 Street NW Senior Manager 10th Floor (780) 392-5305 Edmonton, Alberta rmah@capitalpower.com Canada, T5H 0E9 www.capitalpower.com

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