Capital Power Corporation · TSX:CPX
Capital Power — Investor Day (November 2022)
94 slides from Capital Power's investor day presentation, November 2022
Slide 1: Powered by Purpose
Powered by Purpose Capital apital © 7
Slide 2: Executive Leadership Team
Executive Leadership Team Jacquie Bryan Chris Brian Sandra Kate Steve Pylypiuk DeNeve Kopecky Vaasjo Haskins Chisholm Owens SVP, People, SVP, Operations SVP, Chief Legal, President and SVP, Finance SVP, Chief SVP, Construction Culture and Development and Chief Executive and Chief Strategy and and En
Slide 3: Forward-looking information
Forward-looking information Cautionary statement Certain information in today’s presentations and in responses to questions contains forward-looking information. Actual results could differ materially from conclusions, forecasts or projections in the forward-looking information, and certain material
Slide 4: Agenda
Agenda Our Resilient Strategy Brian Vaasjo Powering a Sustainable Future Kate Chisholm Operational Excellence Bryan DeNeve Progress on Committed Projects Steve Owens & Chris Kopecky Robust Growth Opportunities Chris Kopecky Advancing Genesee CCS Brian Vaasjo & Sandra Haskins Positive Power Market Dy
Slide 5: Our Resilient Strategy
Our Resilient Strategy • Executing our strategy • Progress on sustainability targets • Advancing the “social” in ESG 5
Slide 6: Our Strategy – Powering our Future
Our Strategy – Powering our Future To acquire and/or optimize natural gas assets • Re-contracting proving out • Public and investor sentiment evolving on natural gas for reliability and affordability • Ontario opportunity • Midland excellent strategic acquisition in MISO • Alberta strategy of reposi
Slide 7: Pathway to Net Zero
2009– TODAY TODAY–2024 Pathway to • Genesee efficiency program - 12% decrease in greenhouse gas (GHG) by 2021 • Complete repowering and off coal • Genesee Battery Energy Storage System Net Zero • Over $3B invested in/committed to renewables • CCUS FEED study at Genesee and commence construction • C2
Slide 8: Strong Positioning in the Alberta Market
Strong Positioning in the Alberta Market Genesee opportunity • Repowered units 1 and 2 to use best-in-class natural gas combined cycle technology and CCS technology to reduce emissions • Optimized to provide reliable, dispatchable power for decades to come • Favourable federal and provincial environ
Slide 9: Outlook: 2022 and 2023
Outlook: 2022 and 2023 Very strong growth 2023: marking a 2022 adjusted EBITDA growth of 16% decade of continuous from the original target dividend growth 2023 adjusted EBITDA growth of 13% Strong TSR 2023: robust outlook Top of our peers with 20% for 2022 YTD for growth 25% per year for 5 years 9
Slide 10: Sustainability Commitments and Progress
Sustainability Commitments and Progress On track to meet our sustainability targets 2022 executive and Sustainable sourcing Sustainability-linked leadership compensation and water management credit facilities tied to linked to environment and – continued execution of emission intensity targets socia
Slide 11: Powering a Sustainable Future
Powering a Sustainable Future • Government policy update • Strategy update • Sustainability progress • What’s next 11
Slide 12: 2021 Regulatory Policy Context
2021 Regulatory Policy Context • Healthy Environment and a Healthy Economy (HEHE) plan & "net zero electricity grid" • Technology Innovation and Emissions Reduction (TIER) regulation uncertainty • Importance of natural gas to reliability and affordability and CCUS projects if sun/moon/stars align 12
Slide 13: 2022 Regulatory Policy Development – Q1/Q2
2022 Regulatory Policy Development – Q1/Q2 JANUARY ‘22 MARCH ‘22 APRIL ‘22 JUNE ‘22 — — — — IEA releases “Canada ECCC releases CES discussion paper Federal Budget 2022 GOC announced 2022 – Energy Policy affirming NZ2035 and importance of includes details that development of the Federal Report" sugge
Slide 14: 2022 Regulatory Policy Development – Q3/Q4
2022 Regulatory Policy Development – Q3/Q4 JULY ‘22 AUGUST ‘22 OCTOBER ‘22 NOVEMBER ‘22 — — — — GOC releases U.S. passes Inflation PM/relevant Ministers make public GOC releases Fall Proposed Clean Reduction Act (IRA) into announcements of dev’t of “bespoke” Economic Statement, Electricity Frame law
Slide 15: Net Zero by 2045
Decarbonization Approaches Net Zero We are advancing technologies to enable a clean power system with by 2045 abated natural gas to achieve net zero by 2045 reliably and affordably. CCUS Hydrogen Negative Abatement Baseload generation with Mid-merit / peaking Mid-merit / peaking generation with no a
Slide 16: CAISO Practical Reality
CAISO Practical Reality Supply Trend Energy in megawatts broken down by resource in 5-minute increments 09/06/2022 Record Much Below Near Above Much Record Coldest Below Average Average Average Above Warmest Source: http://www.caiso.com/TodaysOutlook/Pages/Supply.aspx; CAISO Source: California ISO -
Slide 17: Reliability
Reliability Natural gas ensures critical system reliability when wind, solar and battery storage are not available Generation Max Capacity Hydro 1% Dual Fuel 2% Wind 1% Other 3% Other 3% Coal 5% Solar 4% Hydro 5% Coal 8% Solar 6% Wind 17% Gas 83% Gas 62% Dual Fuel 0% Storage 0% Storage 0% Source: AE
Slide 18: Future Net Zero Supply Stack
Future Net Zero Supply Stack Generic Annual Generation Stack Unabated NG for balancing Storage • Generation from unabated natural gas will reduce over time • Capacity and flexibility provided by natural gas will Renewables be vital to preserving power system reliability to: • Balance seasonal variab
Slide 19: Decarbonization Approaches Across our Portfolio
Decarbonization Approaches Across our Portfolio CCUS = Carbon Capture Utilization & Storage, DAC = Direct Air Capture, NBS = Nature Based Solution • Continue to work through the technical viability and economics of these approaches in the short term to enable their deployment in the medium to long t
Slide 20: Carbon Avoidance vs Carbon Removals
Carbon Avoidance vs Carbon Removals UN International Panel on Climate Change (IPCC) Staying Below 1.5 Degrees of Global Warming 40 Business as Usual “Negative emissions are a 30 Conventional necessity, not a luxury on the Mitigation global path to addressing Techniques climate change.” 20 - Canada H
Slide 21: Negative Abatement Solutions
Negative Abatement Solutions Nature Based Direct Air Solutions (NBS) Capture (DAC) An already proven approach A maturing technology with focused on developing and expected performance and cost restoring natural carbon sinks improvement over time offering to enable carbon removal scalable carbon remo
Slide 22: Pathway to Net Zero
2009– TODAY TODAY–2024 Pathway to • Genesee efficiency program - 12% decrease in greenhouse gas (GHG) by 2021 • Complete repowering and off coal • Genesee Battery Energy Storage System Net Zero • Over $3B invested in/committed to renewables • C2CNT interest increased to 40% • CCUS FEED study at Gene
Slide 23: SBTi – Requirements for Power Sector
SBTi* – Requirements for Power Sector 2030 SBTi emission intensity Current ability to apply decarbonization Emissions 1.5-degree Intensity scenario = 0.1 tCO2e/MWh approaches to SBTi emission intensity 0.50 0.45 calculation: 0.40 0.35 Approach Included in SBTi tCO2e/MWh 0.30 0.25 CCUS Yes 0.20 0.15
Slide 24: Our Sustainability Targets
Our Sustainability Targets On Track Achieve net zero by 2045 *REVISED* Construct all new natural gas generation units to be carbon capture and/or hydrogen-ready Reducing Scope 1 CO2 emissions at Genesee by 50% by 2030 from 2005 levels Reducing Scope 1 CO2 emissions by 10% by 2030 from 2005 levels, b
Slide 25: Enhancing our ESG performance
Enhancing our ESG performance Executive and leadership incentives linked to ESG 20% of 2023 executive short-term incentive pay • 5% of our Alberta natural gas purchases will be from Responsibly Sourced Natural Gas in 2023 *NEW* • Health, safety and environment index • 30% of new hires to be women ac
Slide 26: Demonstrating ESG Leadership and Excellence
Demonstrating ESG Leadership and Excellence Committed to transparency and reporting on our progress Sustainable World People Protect our people Net Zero Increase diversity by 2045 in our workforce, including management Planet Reduce emissions Optimize intensity of our water use operations Reduce env
Slide 27: Powering a Sustainable Future Summary
Powering a Sustainable Future • Net zero by 2045 Summary • Policy developments support our strategy • Advancing decarbonization across our portfolio • On track to meet our sustainability targets • Demonstrating ESG excellence across our business c 27
Slide 28: Operational Excellence
Operational Excellence • Strong results in a challenging environment • Successful execution of planned outages • Successful implementation of Data Operations Center • Strong progress on Ops2030 • Excellent safety record 28
Slide 29: 2022 Operating Environment
2022 Operating Environment Inflationary pressures Ongoing supply chain issues Challenging labour Extensive availability planned outage scope Higher operating hours 29
Slide 30: High Plant Availability and Increased Capacity Factor
High Plant Availability and Increased Capacity Factor Availability Factor (AF) Capacity Factor (CF) 95% 50% 94% 48% 46% 93% 44% 92% 42% 91% 40% 90% 38% 36% 89% 34% 88% 32% 87% 30% Actual Actual Forecast Budget Actual Actual Forecast Budget 2020 2021 2022 2023 2020 2021 2022 2023 Combined Fleet Linea
Slide 31: Favourable Financial Metrics
Favourable Financial Metrics EBITDA [$/kW-yr] Controllable Costs [$/kW-yr] $350 $45 $300 $40 $250 $35 $200 $150 $30 $100 $25 $50 $- $20 Actual Actual Forecast Budget Actual Actual Forecast Budget 2020 2021 2022 2023 2020 2021 2022 2023 Operated Linear (Operated) Operated Linear (Operated) 31
Slide 32: Successful Execution of Planned Outages
Successful Execution of Planned Outages Positioning our fleet for future availability Arlington Valley Goreway Genesee Unit 1 Genesee Unit 3 Spring 2022 Spring 2022 Spring 2022 Fall 2022 600 MW | 2:1 combined-cycle 875 MW | 3:1 combined-cycle 400 MW | coal fired with 25% 466 MW | coal fired with 100
Slide 33: Over 50% of Ops2030 Achieved
Over 50% of Ops2030 Achieved Major projects Major projects completed to date currently underway • Arlington Valley third evaporation pond; • Advanced pattern steam turbine and generator upgrades; recognition chiller upgrades (York and East Windsor) • Decatur combustion turbine upgrades • Ontario and
Slide 34: Implementation of Data Operations Centre
Implementation of Data Operations Centre Fleet analytics, Remote monitoring and operations diagnostics Improved availability and cost reduction Resource Central sharing and reporting coordination function 34
Slide 35: Health and Safety Core to our Values
Health and Safety Core to our Values Received 2022 Electricity Canada President’s Award for Safety Excellence in Generation • HSE Performance Index promotes activities that positively influence HSE performance and is tied to our employee short-term incentive program • Through October 2022, and compa
Slide 36: Operational Excellence Summary
Operational Excellence • Strategically navigating and responding to Summary challenges in the operating environment • Successful execution of planned outages to maintain and optimize our fleet • On track to meet our $50M adjusted EBITDA by 2030 target from Ops2030 projects • Successful implementatio
Slide 37: Progress on Committed Projects
Progress on Committed Projects • $1.3B committed capital projects through 2024 • Genesee Repowering on time to meet our off-coal commitment in 2023 • Developing carbon free assets using the latest technology 37
Slide 38: Genesee Units 1 and 2 Repowering
Genesee Units 1 and 2 Repowering • Over 95% of materials on-site • Significant progress on the EDTI switchyard has been achieved since receiving our AUC permit on October 6 • Labour attraction and retention has been a challenge in the early stages of the mechanical scope, but attraction and retentio
Slide 39: Genesee Units and Repowering
Genesee Units 1 and 2 Repowering • On schedule to achieve simple cycle commissioning of both units in 2023, followed by combined cycle in Q2 2024 • Forecasting 10% budget overrun due mainly to switchyard cost increases 39
Slide 40: Genesee Battery Energy Storage System (BESS)
Genesee Battery Energy Storage System (BESS) 210 MW net a/c Battery (1 hour discharge) We create value • AESO have initiated a process to review and potentially through resiliency, increase Most Severe Single Contingency (MSSC) beyond optimization 466 MW and innovation • Investigating other cost-eff
Slide 41: Solar Update
Solar Update North Carolina solar • Exploring options with Duke to progress projects • Poor project returns remain likely Clydesdale Solar (formerly Enchant) • First Generation on Nov. 3, 2022 • COD on schedule for December 2022 • Budget overrun – consistent with Q1 project update • Overrun attribut
Slide 42: Halkirk 2 Wind
Halkirk 2 Wind • 151 MW wind project • Paintearth County, Alberta (north of Halkirk 1 Wind) • $274M Milestone Schedule Date Optimization and technology On-going selection AUC Amendment filing October 2022 Anticipated AUC approval Q2/3 2023 [ Replace with appropriate Construction start scheduled Q3 2
Slide 43: Progress on Committed Projects Summary
Progress on Committed Projects • Significant progress made on the Genesee Summary Repowering project – on time to meet our off-coal 2023 commitment • Progress on designing and constructing projects from our robust development pipeline • Successfully contracting wind and solar assets in Alberta • $1.
Slide 44: Robust Growth Opportunities
Robust Growth Opportunities • Successful track record • Growing renewables pipeline • Near term opportunities 44
Slide 45: Sources of Adjusted EBITDA Growth Since 2013
Sources of Adjusted EBITDA Growth Since 2013 Adjusted EBITDA Growth 1,000 900 800 700 67% 33% 600 $ Millions 500 400 Natural Gas Renewables 300 200 100 - 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022E 2023E Natural Gas Renewables 45
Slide 46: Political Support for Renewable Energy
Political Support for Renewable Energy We’re poised to participate in the massive buildout of renewable generation Inflation Reduction Act Fall Economic statement ($250B USD in federal funding ($15B in federal funding for for clean energy) clean energy) Wind/solar capacity is forecast to Wind/solar
Slide 47: Our Growth Pipeline: 4,700 MW and Growing
Our Growth Pipeline: 4,700 MW and Growing Significant near-term growth opportunities in Western Canada, Ontario and MISO 924 MW wind 2,486 MW solar 700 MW 295 MW gas 2,300 MWh battery storage Wind Solar Gas Battery Storage Solar + Battery Storage 47
Slide 48: Near-Term Renewables Growth (Canada)
Near-Term Renewables Growth Canada Aldersyde Whitla Solar Rolling Hills Greenfell Peebles Solar 1 & 2 Wind Wind Wind 400 MW 88 MW 190 MW 100 MW 200 MW Alberta Saskatchewan 48
Slide 49: Near-Term Renewables Growth (United States)
Near-Term Renewables Growth United States Nolin Hills Rail Line Kepple East Greencastle Ironwood Creek Donica 600 MW 50 MW 100 MW 60 MW 100 MW 340 MW 100 MWh 200 MWh 120 MWh 200 MWh WECC* MISO* FRCC* *Western Electric Coordinating Council (WECC); Midcontinent Independent System Operator (MISO); Flor
Slide 50: IESO Capacity Procurement
IESO* Capacity Procurement Significant near-term need for supply in Ontario 1,500 MW of natural gas 2,500 MWh of storage 15-year contracts 22-year contracts December 6 Q1 & Q4 2023 Final contract details Awards November 30 December 20 / 2025-2027 Deliverability test January 24 Commercial Submissions
Slide 51: Ontario Fleet: Brownfield Advantage
Ontario Fleet: Brownfield Advantage 100 MW Potential thermal upgrades at existing facilities Goreway 300 MW 875 MW Gas generation expansion potential York 456 MW 260 MWh Potential battery Toronto storage projects East Windsor 92 MW 51
Slide 52: Midland Cogeneration Venture (MCV)
Midland Cogeneration Venture (MCV) Strategic growth in MISO 1,633 MW 99% 90% Nameplate Capacity PPA Availability Contracted Gross Margin 52
Slide 53: Highly Favourable Market Dynamics
Highly Favourable Market Dynamics MCV’s output will be even more critical in the mid-2020s Midland Cogeneration ~12 GWa (slightly larger than Alberta) • Population of ~10 million • Legacy energy production from coal Shifting generation mix • 5 GW of baseload retirements over the next 5 years • Major
Slide 54: MCV: Very Strong Contracting Relationships
MCV: Very Strong Contracting Relationships Many avenues for re-contracting and expansion Investor Municipal Electricity MISO capacity owned utilities & retailers auction co-ops Zone 7 auction recently utilities cleared at the price cap of $236.66/MW-Day 54
Slide 55: Well Positioned for Additional Growth in MISO
Well Positioned for Additional Growth in MISO Solar & Battery Natural Gas Development potential Expansion potential • ~600 MW of solar and battery potential in MISO • Up to 500 MW of gas expansion/optimization at MCV • Near-term opportunity via RFPs and C&I offtakes • Projected returns at brownfield
Slide 56: Our Midlife Natural Gas Strategy in Action
Our Midlife Natural Gas Strategy in Action Acquire midlife gas Enhance value Re-contract Leverage brownfield advantages • Accretive & contracted • CT upgrades • Island extended • Uprates through 2026 • Advantaged location • Carbon mitigation • Expansions • Decatur renewed • Competitive operational •
Slide 57: Robust Growth Opportunities Summary
Robust Growth Opportunities Summary • Our future is bright • Two renewables projects in 2023 • Great opportunities in Ontario and MISO • Continuing natural gas M&A opportunities 57
Slide 58: Advancing Genesee CCS
Advancing Genesee CCS • Genesee 1 & 2 repowered units • 95% capture rate at full capacity • 3 million tonnes of CO2 per year • FNTP Q3 2023 • Commence operation in 2027 58
Slide 59: Genesee CCS Progress and Limited Notice to Proceed
Genesee CCS Progress and Limited Notice to Proceed Limited Notice to Status Full Notice to Status Proceed Expectations Proceed Expectations FEED Study • Revised capital cost of $2.3B • Firm capital costs • Technology works • Technology confirmation • Due diligence • Performance guarantees CCS Hub •
Slide 60: Front-end Engineering and Design (FEED) Study
Front-end Engineering and Design (FEED) Study • Kiewit Engineering Group Inc. and Mitsubishi Heavy Industries Engineering, Ltd. • Utilizing Mitsubishi’s post-combustion CO2 capture technology • Revised capital cost of $2.3B • Still significant technical issues to confirm viability of the application
Slide 61: Enbridge Carbon Hub
Enbridge Carbon Hub • Enbridge is developing the “Open Access Wabamun Carbon Hub” to support carbon capture projects • Will be a key part of one of the world’s largest integrated carbon capture, transportation and storage projects • Genesee CCS project (located ~10 km away) will be anchor tenant for
Slide 62: Strong Government Support
Strong Government Support • Genesee CCS project continues to receive positive signals and feedback from key government agencies • Announced Limited Notice to Proceed based on increasing policy certainty Federal Finance Selected as one of 10 Canada Infrastructure As per the Federal Fall released Draf
Slide 63: Genesee CCS Project Financing
Genesee CCS Project Financing After-tax returns expected to be commensurate with risk • Construction cost estimate revised Expected Financing Plan to $2.3B • After consideration of ITCs, expect the ITCs1 remaining costs to be funded ~50/50 between Government sources (SIF and/or Capital Power/ Partne
Slide 64: Advancing Genesee CCS Summary
Advancing Genesee CCS • Limited Notice to Proceed for Genesee CCS Summary • FEED study underway • Will connect to the Enbridge Open Access Wabamun Carbon Hub • Strong government support • After-tax returns expected to be commensurate with risk 64
Slide 65: Positive Power Market Dynamics
Positive Power Market Dynamics • Alberta power market seeing unprecedented prices in 2022 and 2023 • Supply under construction adds ~6,800 MW over the next few years, including renewables and thermal • Demand expected to increase modestly year-over-year • Prices to moderate as new supply displ
Slide 66: Alberta Power Pricing
Alberta Power Pricing Market progresses through supply-demand balance cycle Alberta Energy Market Prices - Third-Party Range 7x24 APP ($/MWh) 160 140 120 100 80 60 40 20 - 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Range Historical APP Forwards as of Nov 16, 2022 66
Slide 67: Alberta Power Market
Alberta Power Market Market tightness building Count of hours < 12% RM1 • 2014 saw a large number of 200 tight reserve margin hours prior to Shepard coming online 150 • Current reserve margin has moved up but remains lower Count of Hours 100 than 2014 • Other market factors beyond reserve 50 margin
Slide 68: Alberta Power Market
Alberta Power Market A market in transition Unit Additions and Retirements (MW) 4000 3000 Storage 2000 Coal Dual Fuel 1000 Coal-to-Gas Cogen 0 Gas CCS Gas -1000 Other Solar Wind -2000 -3000 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 Source: AESO 68
Slide 69: Alberta Power Market
Alberta Power Market Gas provides the majority of electricity output 2022 YTD Generation 2025 Generation 2030 Generation Hydro 2% Other 3% Other 3% Hydro 2% Other 3% Hydro 2% Solar 2% Solar 4% Solar 5% Converted Coal 12% Gas 3% Gas CCS 10% Converted Wind 21% Gas 12% Converted Gas 1% Gas 60% Gas 55%
Slide 70: Alberta Power Market
Alberta Power Market Large volume of new capacity under construction MWs Under Construction 4000 • Currently ~34,000 MW of projects in the AESO queue and AUC e-filing 3500 • ~1,800 MW belonging to Capital Power Other 3000 Suncor • Close to 6,800 MW are under construction Cogen 2500 • Over 20% of ‘un
Slide 71: Genesee Repowering
Genesee Repowering Significantly reducing carbon emissions and increasing competitiveness Illustrative Variable Cost Comparison ($/MWh) 70 Marginal Price Marginal Price 60 50 40 30 20 10 0 Marginal Genesee 1/2 Marginal Genesee Repower Thermal Unit Thermal Unit 2023 2025 Fuel VOM GHG 71
Slide 72: Positive Power Market Dynamics Summary
Positive Power Market Dynamics • High power prices carrying forward into 2023 Summary • New renewables and efficient gas supply will displace less efficient thermal units and bring prices down to more normal levels • Extremely well positioned to continue as the market leader with the most efficient
Slide 73: Stable Financial Strategy
Stable Financial Strategy • Strong cash flow funds growth capex and maintains investment grade credit rating • Average annual TSR of 14% since inception exceeds target of 10-12% over the long term • Consistent annual dividend increases with guidance of 6% out to 2025 73
Slide 74: Overview of Financial Strategy
Overview of Financial Strategy Maintain Funding growth Maintain Deliver annual financial stability towards a net investment grade dividend growth zero future credit rating • Strong liquidity available • Internally generated • Credit metrics exceed • 6% annual dividend on $1B of credit facilities cas
Slide 75: 2022 Targets – AFFO 31% Above Original Guidance
2022 Targets – AFFO 31% Above Original Guidance Reaffirming 2022 revised financial guidance Facility availability Sustaining capex ($M) AFFO ($M) Adjusted EBITDA ($M) 93% 93% $130 to $140 $770 to $810 $1,300 to $1,340 $1,110 to $1,160 $105 to $115 $580 to $630 +23% +16% +31% 2022T Revised Target 202
Slide 76: 5-year Growth in Key Financial Metrics
5-year Growth in Key Financial Metrics ~16% CAGR in AFFO from 2018 to 2023 $M $/share 1,600 $7.00 1,400 $6.00 1,200 $5.00 1,000 $4.00 800 $3.00 600 $2.00 400 $1.00 200 $0.00 2018 2019 (1) 2020 2021 2022E 2023E AFFO Adjusted EBITDA AFFO/share 5-year growth delivered from achieving average growth cape
Slide 77: 2023 Adjusted EBITDA Compared to 2022 Guidance
2023 Adjusted EBITDA Compared to 2022 Guidance 13% year-over-year increase in adjusted EBITDA ($M) $1,600 $1,455 to $1,515 $75 $(10) $(15) $1,500 $115 Contracting/ Recontracting Other $1,400 AB Commercial $1,320 $1,300 New Assets $1,200 $1,100 $1,000 2022T (1) 2023T 1) 2022T represents the midpoint
Slide 78: 2023 AFFO Compared to 2022 Guidance
2023 AFFO Compared to 2022 Guidance Year-over-year increase mostly offset by 2022 tax expense paid in 2023 ($M) $1,000 $175 $(120) $950 $900 $805 to $865 $(10) $850 Current Tax $800 $790 Financing Cash EBITDA $750 $700 $650 $600 2022T (1) 2023T 1) 2022T represents midpoint of the revised guidance ra
Slide 79: Alberta Commercial Portfolio
Alberta Commercial Portfolio Reducing volatility and risk with multi-year hedges GWh Power Hedged Volume 10,000 (All data as of November 18, 2022) 2023 2024 2025 9,000 Power 8,000 7,000 Hedged volume (GWh) 10,000 6,500 5,000 6,000 Weighted average hedged prices(1) ($/MWh) High-$70s Mid-$60s Mid-$60s
Slide 80: Delivering 9 Consecutive Years of Dividend Growth
Delivering 9 Consecutive Years of Dividend Growth Annual dividend increase guidance of 6% to 2025 +6% per year ~7% CAGR $2.32 $2.19 Forecast to be $1.26 below AFFO payout ratio target range of 39% ~40% 45% to 55% payout average payout through 2025 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 20
Slide 81: Cash Flow and Financing Outlook
Cash Flow and Financing Outlook AFFO funds dividend and committed growth capex in 2023 Cash / credit Debt facilities / $75M repayments debt capital $90M(1) markets $910M (1) $910M AFFO Common $275M $835M dividends $545M Committed growth/ (3) enhancement capex Expected Sources Expected Uses 1) Includ
Slide 82: Executing on ~$1.3B of Growth Capex
Executing on ~$1.3B(1) of Growth Capex Committed capital funded by internally generated cashflow, tax equity and minor draw on credit facilities $773M 91 $545M 284 341 248 122 37 150 45 2023E 2024E (2) (3) Genesee battery storage Halkirk 2 US renewable assets Genesee Repower 1) Remaining spending on
Slide 83: Debt Maturity Profile
Debt Maturity Profile(1) Well spread-out debt maturities supported by long asset lives • Strong liquidity with $1B in sustainability linked credit facilities maturing in 2027 • Underlying on refinancings in 2024 – 2026 hedged well below current rates • 2023 forecast credit metrics well above current
Slide 84: Stable Financial Strategy Summary
Stable Financial Strategy • Strong and resilient cashflow Summary • Increase to 2022 guidance reaffirmed • 2023 adjusted EBITDA up 13% driven by asset additions • AFFO up 6% from midpoint of 2022 revised guidance • Internally generated cash flow will fund current growth capex – well positioned to
Slide 85: Value Proposition
Value Proposition • A responsible, sustainability- focused and attractive investment 85
Slide 86: Powering a Sustainable Future for People and Planet
Powering a Sustainable Future for People and Planet Resiliency • Delivering on our disciplined, resilient strategy year-over-year to reliably and sustainably power our communities and create value for all our stakeholders Optimization • We optimize our operations to deliver best-in-class service to
Slide 87: 2023 Operational and Financial Targets
2023 Operational and Financial Targets Sustaining capex ($M) Facility availability Adjusted EBITDA ($M) AFFO ($M) $1,455 to $1,515 $805 to $130 to $135 to $1,300 to $770 to $865 $105 to $140 $145 93% 94% $1,340 $810 $1,110 to $580 to $115 $1,160 $630 Original Revised 2023 Target 2022 Target 2023 Tar
Slide 88: 2023 Growth Targets
2023 Growth Targets Progress on Genesee 1 and 2 repowering project – revised schedule and budget Advancement of Genesee CCS project and Genesee Carbon Conversion Centre Continued progress on Halkirk 2 Wind on time and on budget Investment decision on two renewable projects $600M Target $600M committ
Slide 89: 2023 Sustainability Targets
2023 Sustainability Targets 2045 Target of net zero by 2045 Sustainable Sourcing Policy Strong performance relating to existing targets Green Financing Framework and sustainability-linked financing Enhanced ESG targets 89
Slide 90: Delivering Value to Shareholders
Delivering Value to Shareholders Average annual total shareholder returns (TSR) We create value through resiliency, CPX Peer Average(1) 25% optimization 20% and innovation 16% 9% 7% Delivering average annual TSR of 14% since inception in 2009 2022 3 Years 5 Years YTD -6% 1) Peer group consists of: A
Slide 91: Attractive Investment Opportunity
Attractive • Successful natural gas acquisition, optimization Investment and re-contracting track record Opportunity • Well positioned for Ontario growth and Resilient strategy drives contract extensions growth and accelerates net zero by 2045 • Positioned for significant renewable growth from large
Slide 92: Non-GAAP financial measures and ratios
Non-GAAP financial measures and ratios The Company uses (i) earnings before net finance expense, income tax expense, depreciation and amortization, impairments, foreign exchange gains or losses, finance expense and depreciation expense from its joint venture interests, gains or losses on disposals a
Slide 93: Forward-looking information
Forward-looking information Forward-looking information or statements included in the presentation are provided to inform the Company’s shareholders and potential investors about management’s assessment of Capital Power’s future plans and operations. This information may not be appropriate for other
Slide 94: Investor Relations
Investor Relations Randy Mah Director, Investor Relations (780) 392-5305 rmah@capitalpower.com 10423 101 Street NW 11th Floor Edmonton, Alberta Canada T5H 0E9 capitalpower.com