Slide 1: Ormat Technologies, Inc. Investor Presentation August 2023
ORMAT TECHNOLOGIES, INC. INVESTOR PRESENTATION AUGUST 2023
Slide 2: Safe Harbor Statement and Non-GAAP Metrics
SAFE HARBOR STATEMENT AND NON-GAAP METRICS THIS PRESENTATION INCLUDES FORWARD-LOOKING STATEMENTS, AND THE DISCLAIMER SHOULD BE READ CAREFULLY FORWARD-LOOKING STATEMENTS These forward-looking statements are not intended to be a guarantee of future results, but instead This presentation, and informati
Slide 3: COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC.
COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 3 3
Slide 4: A Leading Renewable Energy Provider
A LEADING RENEWABLE CD4, Mammoth Complex, NV, USA, 65MW ENERGY PROVIDER WITH A PROVEN TRACK RECORD IN GEOTHERMAL AND ENERGY STORAGE over Own & operate 55 ~ 1.28GW 1,480 Years of Geothermal, Storage, Employees experience Solar PV & REG1 $ 734M $ 436M $ 66M 2022 revenues 2022 adj. EBITDA2 2022 Net inc
Slide 5: Our Business Segments
OUR BUSINESS SEGMENTS 84% 12% 4% Of LTM Of LTM Of LTM revenues revenues revenues ELECTRICITY PRODUCT ENERGY STORAGE Develop, build, own and operate Design, manufacture and sell Growing to establish geothermal, solar and recovered equipment for geothermal and leading position in the energy-based (REG
Slide 6: Overview: Geothermal market, Business updates, Regulation, Indonesia
Overview Geothermal market Business updates Regulation updates Development in Indonesia COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 6 6
Slide 7: Overview
OVERVIEW Generates firm & flexible power Diversified portfolio 2022 revenue geographic breakdown 1 822 MW U.S. 3 38 MW Honduras 5 150 MW Kenya 1,107MW 74% U.S. 26% International Geothermal, Solar PV & REG 2 40 MW 4 15 MW 6 42 MW1 Guatemala Guadeloupe Indonesia 92% Growing Profitable portfolio3 Geoth
Slide 8: Geothermal Market
GEOTHERMAL MARKET # 2 Ormat - the 2nd largest geothermal ABOITIZ POWER STAR ENERGY PERTAMINA owner & operator1 ON POWER MERCURY ORMAT CALPINE KENGEN ENEL EDC CFE ~ 16GW Global Installed geothermal capacity2 9x EU Africa ASIA Oceania U.S LATAM Global Potential Installed 3.6 0.9 4.9 1.0 3.7 1.7 vs. In
Slide 9: Strong Tailwind: IRA Signed Into Law
STRONG IRA SIGNED INTO LAW AUG. 16 ,2022 TAILWIND INFLATION REDUCTION PTC ITC ACT (IRA) BENEFITS TO THE BENEFITS TO THE GEOTHERMAL ASSETS STORAGE ASSETS TAX EQUITY TRANSACTION ITC SALE EBITDA IMPACT OVER REDUCES TAX EXPENSES & UP-TO 10 YRS. BOOSTS EPS $150M CASH THAT IS EXPECTED TO REDUCES CAPITAL N
Slide 10: Regulatory Environment: Contribution of IRA
REGULATORY ENVIRONMENT Contribution of IRA U.S PTC - $27.5/MWh ITC – 30-40% of initial Claimed for geothermal investment Impacts Adj. EBITDA Claimed for Storage Impacts Net income Income attribute to signed tax equity transactions in Q2 2023 - Transferable ITC $12.3 million Q2 2023 - $9.0 million +2
Slide 11: Development in Indonesia
DEVELOPMENT IN INDONESIA SARULLA 42MW TOKA TINDUNG Under development: # 1 4 th 12.75% ownership in operation initial drilling Largest Largest economy in country in Southeast Asia1 the world 2 75- 100% ownership BBB/ Baa2 ~ 33GW Country’s 2020 electricity 100% ownership rating by S&P production4 and
Slide 12: Storage market, Regulation, Pipeline update
Storage market Regulation Pipeline update COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 12 12
Slide 13: Steep Market Growth Trajectory
STEEP MARKET GROWTH TRAJECTORY U.S. FTM storage is expected to reach 59GW in 2026 58,965 26x from 2020 46,084 54% 32,604 of projected growth from California & Texas 19,689 9,671 5,185 2,201 1,092 2019 2020 2021 2022 2023E 2024E 2025E 2026E California Texas Nevada Arizona Hawaii New York PJM (& NJ) A
Slide 14: Regulatory and Policy Drivers
REGULATORY AND POLICY DRIVERS Hinesburg storage facility, VT, USA 2MW/5MWh STATE-LEVEL ENERGY STORAGE TARGETS Oregon Nevada New York Maine Massachusetts 10 MWh1 1 GW by 2030 6 GW by 2030 400 MW by 2030 1 GW by YE 2025 CPUC2: Procure additional 15GW of new storage and demand response states have ener
Slide 15: Energy Storage
ENERGY STORAGE TARGET THE LARGEST AND MOST LUCRATIVE MARKETS: 4 California, Texas, and PJM 1 5 3 2 FOCUS ON STANDALONE ENERGY STORAGE Providing ancillary service, energy and capacity to the grid EXPANSION TO NEW REGIONS Short-term: additional markets in the U.S. Mid-term: international regions 1 55M
Slide 16: Energy Storage Development
ENERGY STORAGE DEVELOPMENT Stryker storage facility, NJ, USA 20MW/20MWh 62MW/62MWh COD of 4 new facilities in Q2 155MW/380 MWh 3 new assets released for construction 275MW/740MWh Under construction secured for battery supply and revenue source (1) See appendix for Energy Storage projects in developm
Slide 17: Segment overview, Backlog updates
Segment overview Backlog updates COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 17 17
Slide 18: Product Segment Overview
PRODUCT SEGMENT Primary provider of geothermal binary plants Suppliers of geothermal power plants 2018 – 2022 capacity, MW OVERVIEW 61% 73% Binary Ormat A market leader 1837 BINARY MW TOTAL Built approx. 190 power plants and installed approx. 3,200 MW of geothermal Kaishan 14% & REG over the years 2
Slide 19: Product Backlog
PRODUCT BACKLOG TAOM, NZ 28MW 3RD PARTIES’ CONTRACTS 22% ~$ 120M 118% backlog increase vs. 48% 14% Q2 2022 5% 7% 4% 94% Approx $ M 44 Geothermal new contracts Geographic Breakdown contracts signed2 New Zealand Indonesia Other 3 Taiwan Guatemala USA Backlog recovery 281 251 243 229 226 216 226 207 19
Slide 20: COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC.
COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 20 2
Slide 21: Robust Growth Plan
ROBUST GROWTH PLAN 1.9GW – 2.0GW 64% - 73% NEW 2025 portfolio target Expected MW growth vs Driven by successful 2022 expansion efforts Significantly Accelerate increase solar storage capacity & geothermal to establish leading position in the U.S. capacity storage sector This growth plan is subject t
Slide 22: 2025 Growth Target by Segments
2025 GROWTH TARGET CD4 part of Mammoth complex, CA, USA 65MW BY SEGMENTS GEOTHERMAL & ENERGY SOLAR ENERGY STORAGE 600MW-670MW YE 2025 TARGET 1,300MW-1,330MW 1,470 MWh-1,700 MWh MW ADDITION (VS 2022) 230MW-260MW 512MW-582MW MW GROWTH 21%-24% 582%-661% Change in MW growth is compared to a 1,070MW Elec
Slide 23: Ormat COD Timeline
ORMAT COD TIMELINE +69 1,277 +182 MW 63 +35 6 19 +60 +5 16 5 55 +13 1,095 Operating as of Q1 2022 Q2 2022 Q3 2022 Q1 2023 Q2 2023 operating H2 Dec. 31, 2021 Operating Geothermal & Solar Energy COD Energy Storage COD 2023 COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 23 Haen’t
Slide 24: Geothermal Development
GEOTHERMAL DEVELOPMENT North Valley, NV, USA 23MW Projected Expected Project PPA Capacity (MW) COD U.S - North Valley 25 ✓ Under U.S. – Dixie Valley 6 ✓ development: U.S - Heber Complex 8 Q3 2023 ✓ 102 MW from Guatemala – Zunil 5 H2 2023 ✓ 7 projects U.S – Beowawe Repowering 6 Q2 2024 ✓ Indonesia –
Slide 25: Geothermal Development
GEOTHERMAL DEVELOPMENT Indonesia Region Location # of sites Nevada 20 39 California 3 prospects U.S. Oregon 2 Utah 2 New Mexico 1 Guatemala 2 CENTRAL AMERICA Honduras 1 AFRICA Ethiopia 4 Madagascar 1 New Zealand 1 ASIA PACIFIC Indonesia 2 Commence commercial operation was compiled COPYRIGHT © 2023 O
Slide 26: Solar Development
SOLAR DEVELOPMENT Projected Expected Project Capacity PPA COD (MW) U.S. - Brady Solar 6 ✓ Under development: U.S. - Steamboat Solar 7 Q3 2023 ✓ 79 MW from U.S. – North Valley Solar 6 Q3 2023 ✓ 6 projects U.S. – Steamboat Hills Solar 4 Q3 2023 ✓ U.S. – Beowawe Solar 6 H1 2024 ✓ U.S. – McGinness Hills
Slide 27: Energy Storage Development
ENERGY STORAGE DEVELOPMENT Stryker storage facility, NJ, USA 20MW/20MWh Projected Projecte Expected Project Capacity d ITC %1 PPA COD (MW) MWh NJ - Howell 7 7 30% Merchant Under development: Capacity PPA OH – Bowling Green 12 12 30% and Merchant 275 MW/ TX - Upton 23 23 30% Merchant 740MWh from NJ -
Slide 28: Energy Storage Pipeline
ENERGY STORAGE PIPELINE Rabbit Hill storage facility, TX, USA 10MW/10MWh ~3.3GW/11.5GWh 34 potential capacity of named U.S. storage pipeline prospects GEOGRAPHICAL Hawaii 30 BREAKDOWN 1 East Coast 112 WECC 315 Texas 600 California 2,205 1) East coast market includes PJM, ISO-NE, NYISO COPYRIGHT © 20
Slide 29: 2023 Guidance ($M)
2023 GUIDANCE ($M) (1) Total revenues Electricity Products Storage Adjusted EBITDA 823-858 670-685 120-135 33-38 480-510 +12%-17% +6%-8% +68%-89% +7%-23% +10%-17% 1.9 GW-2.0 GW 1.8 GW-1.86 GW TRANSITIONING TO ACCELERATED +18%-20% GROWTH 1.16 GW CAGR 1.1 GW IN STORAGE & 2022-2025E ELECTRICITY SEGMENT
Slide 30: COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC.
COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 30 3
Slide 31: Strong Financial Positioning
STRONG FINANCIAL POSITIONING Installed capacity growth (MW) Revenues growth ($m) 1,287 1,158 1,095 957 1,005 931 $719 $746 $734 $761 $705 $663 2018 2019 2020 2021 2022 Current 2018 2019 2020 2021 2022 LTM Geothermal REG Solar Storage Electricity Product total Adjusted EBITDA growth ($m) $436 $451 $4
Slide 32: Strong Financial Positioning
STRONG FINANCIAL POSITIONING Total Debt ($M) Net Debt ($M)1 $2,027 $2,004 $1,800 $1,908 $1,609 $1,521 $1,456 $1,268 $1,238 $1,090 $1,085 $919 2018 2019 2020 2021 2022 Q2 2023 2018 2019 2020 2021 2022 Q2 2023 Project Finance Finance liability Corporate Debt Net Debt to Capitalization (Total Equity)1
Slide 33: ESG Initiatives
ESG INITIATIVES We are moving to strengthen our ESG commitments Building our approach and policy on significant valuable issues Expecting 2022 We issued our ESG report, the fourth in accordance with GRI standards and the second according to SASB ESG report to be framework. published by Established a
Slide 34: Attractive Investment Thesis
ATTRACTIVE INVESTMENT THESIS Strong financial positioning Robust growth potential ESG Consistent track record of strong Significant, consistent Renewable asset growth returns for shareholders domestic growth in the U.S. supported by favorable regulation Long-term contracted International geothermal
Slide 35: Committed to Continued Profitable Growth
COMMITTED TO CONTINUED PROFITABLE GROWTH IR@ORMAT.COM
Slide 36: Air-Cooled Binary Geothermal Power Plant
AIR-COOLED BINARY GEOTHERMAL POWER PLANT COPYRIGHT © 2023 ORMAT TECHNOLOGIES, INC. 36
Slide 37: Payment of Principal Due by Period ($M)
PAYMENT OF PRINCIPAL DUE BY PERIOD ($M) AVERAGE INTEREST RATE: 4.13% Q3-2023 Q4-2023 Year 2023 Long-term non-recourse debt & limited recourse debt 14.1 14.3 28.4 Long-term loans (full recourse) 23.2 18.3 41.5 Finance Liability 10.3 0.0 10.3 Total $47.6 $32.6 $80.2 Remaining Total 2023 2024 2025 2026
Slide 38: Capex for 2023
CAPEX FOR 2023 ACTUAL INVESTED CAPEX TOTAL CAPEX ($M) IN H1 2023 FOR H2 2023 FOR 2023 Electricity Segment 223 223 446 Construction & Enhancements – fully released 130 95 225 Development enhancement, drillings and Exploration 37 60 97 Puna restoration (including drilling) 24 28 52 Olkaria recovery, p
Slide 39: P&L Highlights
P&L HIGHLIGHTS Q2 2023 Q2 2022 Change (%) H1 2023 H2 2022 Change (%) GAAP MEASURES Revenues ($M) Electricity 155.3 151.2 2.7% 325.6 313.7 3.8% Product 33.5 10.4 222.0% 43.5 25.0 73.9% Energy Storage 6.0 7.5 (19.7)% 10.9 14.1 (22.5)% Total Revenues 194.8 169.1 15.2% 380.0 352.8 7.7% Gross Profit ($ m
Slide 40: Reconciliation of EBITDA and Adjusted EBITDA
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA (DOLLARS IN THOUSANDS) Three Months Six Months Ended June 30, Ended June 30, 2023 2022 2023 2022 Net income 24,511 14,948 57,972 37,738 Adjusted for: Interest expense, net (including amortization of deferred financing costs) 19,451 20,239 41,231 40,978 In
Slide 41: Reconciliation of Adjusted Net Income and Adjusted EPS
RECONCILIATION OF ADJUSTED NET INCOME ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS AND ADJUSTED EPS Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 (in millions, except for EPS) GAAP Net income attributable to the Company's stockholders $24.2 11.3 53.2 29.7 Write-off of Energ
Slide 42: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES June 30, 2023 Cash and cash equivalents, marketable securities and Restricted cash (in millions $) Cash and cash equivalents 275 Restricted cash and cash equivalents 120 Total cash and cash equivalents, marketable securities and Restricted cash (in milli