Mpc Energy Solutions Nv · OSL:MPCES
Mpc Energy Solutions Nv — Investor Day (March 2023)
45 slides from Mpc Energy Solutions Nv's investor day presentation, Mar 29, 2023
Slide 1: Making Clean Energy Happen! Capital Markets Day
29 March 2023 MAKING CLEAN ENERGY HAPPEN! Capital Markets Day
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS MPC Energy Solutions Certain information and statements shared in this document, including financial estimates and comments about our plans, expectations, beliefs, or business prospects, and other information and statements that are not historical in nature, may constitute
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Slide 4: Strategy, Projects & Growth
MPC ENERGY SOLUTIONS Strategy, Projects & Growth | | 4
Slide 5: Full-Cycle Independent Power Producer
FULL-CYCLE INDEPENDENT POWER PRODUCER Clear focus on clients and value chain MPC Energy Solutions focuses on client needs, regardless of which low-emission Our Market Approach technology is required to enable the transition + We cover the whole value chain, from greenfield development to long-term o
Slide 6: Disruption of Global Energy Markets
DISRUPTION OF GLOBAL ENERGY MARKETS Rapid acceleration of energy transition in Latin America and Caribbean ahead + Corporate sustainability + Climate change and extreme weather + “Green procurement” + Policy shifts + Power outages + SDG goals + Carbon footprint + Net-zero future (2050) + Policy impl
Slide 7: 700% Growth of Renewables in Developing Markets
700% GROWTH OF RENEWABLES IN DEVELOPING MARKETS Net-zero emission future is not possible without massive increase of RE deployment in developing markets Global fuel share and power demand (NZE scenario) CO2 emissions in the Stated Policies Scenario Gt CO2 2050 20 Emerging & 2030 Developing 2020 Econ
Slide 8: Markets with Excellent Growth Opportunities
MARKETS WITH EXCELLENT GROWTH OPPORTUNITIES Providing clean and affordable energy for Latin America and the Caribbean Our Market Approach + Defined focus on Latin America and the Caribbean + Successful expansion of regional presence from four to nine countries between ST. KITTS & NEVIS 2021-2023. Se
Slide 9: Maximizing Value of Each kWh
MAXIMIZING VALUE OF EACH KWH High participation along full project lifecycle and value chain „De-risking“ development phase: Business development and private PPA origination drives project development in most of our markets „Develop-build-operate“ model: Lean cost structure through in-house project
Slide 10: Cost Reduction and Performance Optimization
COST REDUCTION AND PERFORMANCE OPTIMIZATION Insourcing O&M with growing operating portfolio O&M is usually the largest single Opex item and 20-30% saving potential translates into material return improvements after insourcing. All solar PV projects were set up with short term O&M contracts only allo
Slide 11: Expanding Our Development Backlog
EXPANDING OUR DEVELOPMENT BACKLOG Initiate and mature 800 MW project developments to ready to build until 2025 + Focus on proprietary project development and co-development partnership with limited Targeted Proprietary Development pipeline acquisitions in Latin America and the Caribbean region Backl
Slide 12: Our First 1,000 MW in Operation
OUR FIRST 1,000 MW IN OPERATION Convert development pipeline into construction assets and operations by 2027 Targeted Asset Portfolio by Technology in 2027 USD 1 bn 10% Total funding 10% USD 250 m > <100 MW Equity requirement Asset size focus 1 GW 60% 20% USD 125-150 m > EBITDA Farmdowns To monetize
Slide 13: Building a New Powerhouse for the Region
BUILDING A NEW POWERHOUSE FOR THE REGION Executing on our medium-term (5y) strategy and business plan until 2027 1,000 MW Regional leader Excellence in operation or construction for sustainable energy solutions in ESG | Capital Markets Day | 13
Slide 14: Renewable Markets in Latin America and the Caribbean
MPC ENERGY SOLUTIONS Renewable Markets in Latin America and the Caribbean | | 14
Slide 15: Renewable Energy Landscape
RENEWABLE ENERGY LANDSCAPE About 20,000 MW of installed capacity and ambitious deployment targets Highly dynamic energy markets + Current installed solar and wind capacity of about 20,000 MW in the region + Solar takes the majority with about 55% of installed capacity with the tendency to keep growi
Slide 16: Expected Energy Tenders in 2023-2024
EXPECTED ENERGY TENDERS IN 2023-2024 Competitive reverse auction processes Dominican Republic + Renewables + 900 MW Guatemala + ~ $70 - 85/MWh Jamaica + PEG 4 + 200 MW + 250 MW + Solar & BESS + ~ $40 -60/MWh + ~ $ 85/MWh + PEG 5 + 1,300 MW + ~ $40 -60/MWh Puerto Rico Costa Rica + 500 MW RE + 250 MW
Slide 17: Attractive Power Price Environment
ATTRACTIVE POWER PRICE ENVIRONMENT High power prices and high resource availability create an attractive investment environment Highlights 40 to 60 + The majority of Central America and the Caribbean countries highly depend on Mexico conventional fossil fuels, which drives 40 to 60 electricity price
Slide 18: Delivering Sustainable Energy Solutions
DELIVERING SUSTAINABLE ENERGY SOLUTIONS A firm offering will become key to secure PPA’s with utilities and corporates Regional Challenge Enhanced energy solutions + Centralized grid networks are most prevalent in developed economies, while developing economies have a different set of circumstances t
Slide 19: Commercialization of Energy
COMMERCIALIZATION OF ENERGY Route to market depending on local energy market regulation + MPCES active already in all possible paths to commercialize energy + Strong focus on bilateral origination of PPAs and tailored energy solutions + Optimizing revenue (and minimizing Public Tenders Utilities Spo
Slide 20: PPA Origination Process
PPA ORIGINATION PROCESS Competitive solutions tailored to the off-takers specific needs and preferences Tailor costumized solutions and Combine strategically fitting select suitable technology PPAs under one energy (solar, wind, hybrid, other) management system 1 3 5 2 4 Identify off-takers, analyze
Slide 21: Preferred Partner for Leading Off-Takers
PREFERRED PARTNER FOR LEADING OFF-TAKERS Focus on off-takers‘ key requirements for power supply, pricing structures and supply reliability Private Corporates Private Utilities & Traders State-owned Utilities Our Off-takers | Capital Markets Day | 21
Slide 22: Matching the Load Curve
MATCHING THE LOAD CURVE Case Study: "Pay as contracted" to meet clients consumption pattern (Colombia) Contracted PPA Highlights + Project size and design tailored to meet defined load pattern of client (off-taker). Majority of production to be sold under long-term PPA 2 + Exposure to merchant marke
Slide 23: The Emergence of Storage Solutions
THE EMERGENCE OF STORAGE SOLUTIONS Case Study: Hybrid solutions allow for the provision of baseload power (Caribbean island) Energy Dispatch Profile Revenue Profile Highlights + Reducing overall energy system costs by converting 100% intermittent solar power in dispatchable energy while Max to Grid
Slide 24: ESG @ MPCES
MPC ENERGY SOLUTIONS ESG @ MPCES | | 24
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Slide 26: Our ESG Framework: Sustainable Value Strategy
OUR ESG FRAMEWORK: SUSTAINABLE VALUE STRATEGY At MPCES we pay attention to Environment, Social and Governance (ESG) issues Environment Reduction in greenhouse gas GHG emissions and other egregious climate effects Social Positive contributions to SDG’s and to communities and individual well-being Gov
Slide 27: Our ESG Framework: SDG Alignment
OUR ESG FRAMEWORK: SDG ALIGNMENT Priority areas that are directly or indirectly related to the company’s activities Sustainable Value Creation activities + Employee skills training in renewables, hybrid and energy efficiency projects + Reducing negative environmental impact through GHG emissions and
Slide 28: 2022 ESG Highlights
2022 ESG HIGHLIGHTS Our reported progress for our material issues Climate Emissions Diversity & Equal Opportunities Highlights + 33% of employees are female + 9,206.38 tonCO2eq avoided + 9 nationalities emission Started the development of a + + Finalized and released its Sustainable Value Strategy +
Slide 29: Community Engagement
MPC ENERGY SOLUTIONS Community Engagement | | 29
Slide 30: MPCES ESG Ambitions 2023
MPCES ESG AMBITIONS 2023 Our main goals for our material issues Environment & Climate Corporate Governance Climate Emissions Biodiversity Code of Conduct & Anti corruption Supplier & Business Partner + Implementation of environmental + Refine and extend disclosure + Training 100% of all employees +
Slide 31: Financial Review and Outlook
MPC ENERGY SOLUTIONS Financial Review and Outlook | | 31
Slide 32: Guidance 2023: +50 MW Installed Capacity
GUIDANCE 2023: +50 MW INSTALLED CAPACITY Proof-of-concept delivered - scale-up already visible in 2023 (proportionate values in million USD) 10 + Neol CHP Puerto Rico 7 + Santa Rosa/Villa Sol El Salvador 3.6 + Los Girasoles Colombia 2.1 + Planeta Rica Colombia Revenue Project EBITDA Revenue Project
Slide 33: Time-to-Cash Flow
TIME-TO-CASH FLOW Scale-up in the next 3 years w/o additional funding 2023 2024 2025 2026 Los Santos I, Mexico Neol CHP, Puerto Rico Santa Rosa & Villa Sol Los Girasoles, Colombia Planeta Rica, Colombia SOLEC Power, St. Kitts Puerto Rico Pipeline Guatemala Pipeline Acacia, Jamaica Development Backlo
Slide 34: Financial Outlook (1/2)
FINANCIAL OUTLOOK (1/2) Scale-up scenario w/o additional funding - Solar PV remains dominant part of short-term portfolio build-up (proportionate values, year-end) Installed Capacity and Energy Output Installed Capacity Breakdown 411 Installed 183 176 Capacity 129 2025 86 66 2023 2024 2025 CHP Solar
Slide 35: Financial Outlook (2/2)
FINANCIAL OUTLOOK (2/2) Scale-up scenario w/o additional funding - Short-term capital deployment roadmap enables scale-up to cover corporate overhead from project cash flows (proportionate values in million USD) 34 Organization is prepared for scale- 26 up, free equity cash flows in 2025 to cover gr
Slide 36: Long-Term, De-Risked, Predictable Cash Flows
LONG-TERM, DE-RISKED, PREDICTABLE CASH FLOWS All signed PPAs to-date – proportionate values 16 years 90% 10% USD 430 million Weighted average in USD in COP proportionate contracted remaining PPA lifetime revenues under existing PPAs | Capital Markets Day | 36
Slide 37: Debt Financing
MPC ENERGY SOLUTIONS Debt Financing | | 37
Slide 38: 3-Month SOFR Shows Signs of Easement
3-MONTH SOFR SHOWS SIGNS OF EASEMENT Risk margins applied by lenders remain stable, mainly driven by off-taker creditworthiness Futures 5.00% 4.69% 4.50% 4.00% 3.50% 3.00% 2.85% 2.50% 2.00% 1.50% 1.00% 0.50% 0.08% 0.00% Sources: Federal Reserve Bank of New York, Commerzbank | Capital Markets Day | 3
Slide 39: Leverage Boosts Increase
LEVERAGE BOOSTS INCREASE Significant room for additional leverage target to match peers + Recycle Cash 76% + Harvest 50% Interest Trend + Maintain Conservative View proportionate debt ratio Peer Group MPCES | Capital Markets Day | 39
Slide 40: Shareholder Value Through Equity IRR Improvements
SHAREHOLDER VALUE THROUGH EQUITY IRR IMPROVEMENTS Exemplary project, Latin America, 100 MW installed capacity, 20-year indexed PPA, 75% leverage, no tax exemptions + Faster Deployment +100 bps 14% +50 bps +400 bps + O&M Direct Faster Scale-up Insourcing Procurement 8.5% + Broader Leverage Diversific
Slide 41: Moving Debt Upwards
MOVING DEBT UPWARDS Debt markets in the region remain attractive 3 Corporate Debt 2 HoldCo Debt + TopCo-level + Secured by overall cash flows and 1 + Sub-holding-level selected assets Project Debt + Non-recourse + “greenium“ / liquidity + SPV-level + Cross-collateralization by pooling + Investors de
Slide 42: Current NAV per Share – NOK per Share
CURRENT NAV PER SHARE – NOK PER SHARE Based on consolidated year-end 2022 balance sheet, measured at fair value (USDNOK: 10.4029, in million USD) | Capital Markets Day | 42
Slide 43: Q&A Session
MPC ENERGY SOLUTIONS Q&A Session | | 43
Slide 44: Contact Information
CONTACT INFORMATION MPC Energy Solutions N.V. Kon. Wilhelminaplein 1 1062 HG Amsterdam The Netherlands Investor Relations & Public Relations Email: IR@mpc-energysolutions.com www.mpc-energysolutions.com | | 44
Slide 45: Disclaimer
DISCLAIMER MPC Energy Solutions This presentation has been prepared by MPC Energy Solutions N.V. (the “Company”) and is general background information about the Company’s activities at the date of this presentation. The information in this presentation is provided in summary form only and does not p