Brookfield Renewable Corporation · NYSE:BEPC
Brookfield Renewable — Brookfield Renewable Partners — Investor Day (2024)
60 slides from Brookfield Renewable's investor day presentation, Sep 24, 2024
Slide 1: Brookfield Renewable Partners
Brookfield Renewable Partners
Slide 2: Agenda
Year in review Positioned for growth now and in the future Value creation capabilities Diverse growth competencies Positioned to execute and build on our track record Key takeaways and Q&A
Slide 3: Year in review
Year in review Connor Teskey, Chief Executive Officer 3
Slide 4: Another record year for our business
Another record year for our business Record financial Record growth Record asset Robust balance results and activities rotation sheet to fund growth distributions 4
Slide 5: Continuing to deliver strong FFO per unit and distribution growth
Continuing to deliver strong FFO per unit and distribution growth for our investors FFO per Unit Distributions per Unit 12% CAGR 6% CAGR 2016 2024E 2001 2024 And on pace to deliver another record year 5
Slide 6: Accelerating development and capital deployment, driving growth and diversification
Accelerating development and capital deployment, driving growth and diversification 2024 Project Development Cumulative Equity Deployed (Billion) $50 $45 $43 $40 $35 ~7 GW $30 $25 Commissioned Capacity $20 $15 $10 $5 $- North America South America 2012 2014 2016 2018 2020 2022 2024E Europe Asia Paci
Slide 7: One of the largest clean energy producers and developers in the world
We have grown our business to be one of the largest clean energy producers and developers in the world ~37 GW ~200 GW ~$109B Operating Capacity Development Capacity Global AUM 9x 2x 2x 2020 2024E 2020 2024E 2020 2024E 7
Slide 8: Local end-to-end operating and development expertise in all core markets
With local end-to-end operating and development expertise in all core markets China Europe North America Brookfield Renewable China Brookfield Renewable U.S. South Korea H-Energy India Australia Carbon Capture Latin America Brookfield Renewable India Recycling Nuclear RNG SAF 8
Slide 9: We have differentiated ourselves with disciplined execution
We have differentiated ourselves with disciplined execution Partner of Positioned for Expanded into Avoided Prudently choice tech demand increasingly uncontrollable financed our important development business asset classes risk 9
Slide 10: Better positioned than ever to capture growth
We are better positioned than ever to capture growth and enable companies to grow, providing low-cost energy 10
Slide 11: Sector tailwinds continue to support renewable power & transition
Sector tailwinds continue to support renewable power & transition Renewable power Net-zero aligned Energy security and is the lowest-cost legislation and independence are a energy solution corporate targets growing necessity Electrification driving Electricity demand increased power growth from cons
Slide 12: Electricity demand is growing with digitalization and AI
Electricity demand is growing with digitalization and the proliferation of AI—in addition to broader electrification Global Data Center Power Demand AI is driving a step-change in data consumption 15x Computing power and energy are on the critical path for data Data center power demand is growing fr
Slide 13: Significant capabilities in the largest data center markets
We have significant capabilities in all the largest data center markets globally 90%+ Suite of services including critical baseload and dispatchable solutions Of our 200 GW pipeline is in the top 10 data center markets globally 13
Slide 14: Partner of choice to the largest buyers of clean power
Positioning us as the partner of choice to the largest buyers of clean power globally Brookfield Renewable Contracted Volumes ~30% 2024 Doubling generation to C&I Customers corporate customers Other ~50% 2029 Enabling our partners’ growth 14
Slide 15: Invest for value and capture developer returns at the same time
Our scale and diversification allow us to invest for value and capture developer returns at the same time Put another way—it is both a buyer’s and seller's market 15
Slide 16: Buyer's market for those that have
Buyer’s market for those that have Strong balance sheet & Expertise across Operating and access to diverse sources geographies & development capabilities of capital technologies Scale transactions have Flexibility to invest Ability to invest lesser competition where we find the through the best risk
Slide 17: H-Energy Investment Spotlight
Investment Spotlight $10B | H1/25E H-Energy $2.7B | Q4/23 $450M | Q3/24 Leading renewables developer in strategic markets Leading expertise and pipeline in battery storage Opportunity to scale Neoen’s development, $900M | Q4/23 $170M | Q2/24 implement an asset recycling strategy and optimize the cap
Slide 18: Seller's market for those who have
Seller’s market for those who have Right-sized operating Contracted generation Assets generating strong assets and fixed-rate financing returns that justify long- term ownership Robust demand for Derisked Ability to be patient individual assets and infrastructure-like and disciplined in our smaller
Slide 19: Asset Recycling Spotlight
Asset Recycling Spotlight Recycling YTD First Hydro $2.0B+ 2017–2024 2018–2024 24% IRR | 2.6x MOIC Almost $1 billion net to BEP Shepherds Flat 2021–2024 19
Slide 20: Masdar testimonial on Iberian transaction
“Masdar is committed to accelerating the delivery of clean energy capacity across the Iberian Peninsula and Europe. Representing one of Spain’s largest renewable energy transactions, this landmark deal with Brookfield Renewable builds on Masdar’s strong growth story, demonstrating our commitment to
Slide 21: Access to capital is more important than ever
Access to capital is more important than ever, and we are exceptionally well equipped to fund accretive growth opportunities 21
Slide 22: Strong investment-grade balance sheet and robust liquidity
We have a strong investment-grade balance sheet and robust liquidity BBB+ 96% $4.4B Investment-grade Long-term, fixed-rate debt Available liquidity balance sheet 22
Slide 23: Record capital from diverse sources to fund growth
And are generating record capital from our diverse sources to fund growth Asset-level upfinancing Asset recycling Partner capital $500 million Almost $1 billion YTD Almost $10 billion On two hydro contracts At above-target returns Committed and deployed this year 23
Slide 24: Increasing our growth target
As a result of our access to capital and the opportunity set, we are increasing our growth target M&A growth Development Increasing demand opportunities pipeline for clean power Expected capital deployment of $8–9+ billion over the next five years 24
Slide 25: Value creation capabilities
Value creation capabilities Hannah Labuschagne, Head of Global Procurement 25
Slide 26: Market leading footprint and differentiated capabilities
Our market leading footprint and differentiated capabilities enable us to deliver value creation around the globe Procurement Commercial Financing Strategy Capabilities Relationships Operating & Scale & Breadth of Leveraging the Development Best Technical Brookfield Ecosystem Practices Competencies
Slide 27: Depth of expertise, scale and alignment across the value chain
With depth of expertise, scale and alignment tied back through the global value chain ~5,500 Operating Five Centralized Procurement Engineering Employees Control Centers Grid Develop, Build and Operate Through Development Optimization Regional Asset Management Structure ~800 Global Regulatory 150+ P
Slide 28: A repeatable global procurement strategy
A global procurement strategy that is repeatable—and a key pillar in delivering strong risk-adjusted returns Equipment Navigating supply Strategic supply Cementing strong optimization chain & trade policy contracts supplier relationships $60 million in Material impact on Saving up to three After-mar
Slide 29: Curated customer relationships with large corporates
Curated customer relationships—meeting the needs of large corporates on a global basis & tailoring our growth strategy Top 10 Corporate Buyers of Clean Power (GW) High-quality customers focused on decarbonization Scale demand & visibility on growth Cross-selling opportunities Brookfield Customer 29
Slide 30: Accelerating platform growth and offering capacity to partners
Which is enabling us to accelerate platform growth and offer this capacity to our partners $3 billion acquisition| 2019/23 $1 billion acquisition| 2022 $400 million investment | 2023 • Grew development pipeline to • Doubled development • Grew development pipeline 24 GW from 6 GW pipeline to 4 GW to
Slide 31: Sharing best practices across geographies
And constantly sharing best practices across geographies and within our large global business Renewable 35+ Equipment inventory optimization, strategy Platform & regulatory Businesses 2o+ Trading & power Renewable China marketing Joint development Greenfield land derisking construction Countries dev
Slide 32: Finalizing a complex carveout while executing first-year deliverables
Finalizing a complex carveout—while executing on first-year deliverables Carveout near complete Commissioned 650 MW within in six months of new capacity $2.7 billion acquisition| 2023 Optimized capital Closed a number of large procurement structure, completing contracts below over $400 million in un
Slide 33: Opportunities that generate strong, repeatable returns
Translating to opportunities that generate strong, repeatable returns at or above our targets Delivering on the largest Efficiently unlocking Enabling value creation value creation levers complex, scale growth across numerous opportunities workstreams 33
Slide 34: Diverse growth competencies
Diverse growth competencies Ignacio Paz-Ares, Managing Partner, Investments 34
Slide 35: A wide range of competencies to meet growing demand
We have a wide range of competencies to meet growing demand We can operate We can build We can buy Differentiated 16 GW commissioned in $30+ billion capabilities through the last five years Deployed into M&A in value chain last five years 35
Slide 36: World-class development capabilities and diverse pipeline
We have world-class development capabilities and are positioned with a diverse pipeline in our core markets and technologies 200 GW +75% In developed markets Development Expertise Large Project Pipeline Greenfield, repowering and Scale renewable power hybridization pipeline diversified within develo
Slide 37: Unique expertise and capacity to execute M&A
We have unique expertise and capacity to execute M&A, in addition to a robust pipeline of opportunities 150+ Investment Capabilities Professionals across technologies End-to-end Flexible deal competencies structuring in key markets abilities 37
Slide 38: Access to partner capital to invest in larger opportunities
We have access to partner capital that enables us to invest in a larger volume of opportunities and in larger scale platforms Over $30B of capital deployed in last five years Leading to better risk-adjusted returns ~25% BEP Capital Greater diversification Opportunity to share best practices Co-inves
Slide 39: Neoen Investment Spotlight
Investment Spotlight Why Neoen? • Leading renewables developer in strategic markets (France, Australia, the Nordics) • Leading expertise and pipeline in battery storage • Best-in-class management and in-house capabilities $10 Billion | H1/25E Why Brookfield? • Provide capital to scale Neoen’s develo
Slide 40: Underwrite hold-to-maturity, opportunistically recycle at higher returns
We underwrite on a hold-to-maturity basis, but are seeing opportunities to add value and recycle a portion of capital at higher returns Underwrite investments Opportunistically monetize select assets 12–15% 7–9% 20%+ IRRs IRRs IRRs Scale development Build out recycling Asset recycling will be an cap
Slide 41: Asset Recycling Spotlight: Saeta Yield
Asset Recycling Spotlight: Saeta Yield Value Generation • Acquired in 2018 • Executed operating costs improvements • Divested non-core assets and optimized the capital structure $1.4 billion • Established corporate development function to execute on growth • Agreement to sell in Q3/24 • Sale exclude
Slide 42: Positioned to execute and build on our track record
Positioned to execute and build on our track record Wyatt Hartley, Chief Financial Officer 42
Slide 43: Best-in-class balance sheet, robust liquidity and access to scale capital
Best-in-class balance sheet, robust liquidity and access to scale capital BBB+ 96% $4.4B Significant Investment-grade Fixed-rate debt with Available liquidity Partner capital balance sheet no material near- term maturities 43
Slide 44: We have a differentiated funding model
We have a differentiated funding model Corporate Debt Asset-Level Asset Recycling & Preferred Upfinancing Equity 44
Slide 45: Recontracting our large perpetual hydro portfolio
We are recontracting our large perpetual hydro portfolio creating a unique funding lever 450 MW ~3,000 MW Hydro capacity contracted on a long-term Additional hydro capacity available for basis with U.S. utilities recontracting over the next five years Generating Potentially Generating ~$500M $3B+ Up
Slide 46: Asset recycling activities continue to scale
Our asset recycling activities continue to scale with our development and generate strong returns Proceeds From Recycling $3,000M 4x $800M Avg. 2020–2023 2024E 46
Slide 47: High-quality, durable cash flows
Our business generates high-quality, durable cash flows ~90% ~70% +70% Diversified Contracted under Inflation-linked Gross margins on No single market 13-year PPAs revenues power business accounts for >10% 47
Slide 48: Better visibility in achieving target FFO per unit growth
And we have better visibility than ever in achieving target FFO per unit growth over the next five years and beyond 10%+ FFO Per Unit Growth Annually 2–3% 2–4% 4–6% M&A Inflation Margin Development Enhancement Pipeline Activities Escalation Increasingly Highly Visible & Secured Visible & Secured 202
Slide 49: Contracted, inflation-indexed cash flows benefit from inflation
Our contracted, inflation-indexed cash flows mean we benefit from inflation over the long term ~90% ~70% ~13 Yr Contracted Revenue indexed to Average contract generation inflation length ~$150M Incremental annual FFO in 2029 assuming 2–3% inflation or 2% FFO per unit growth 49
Slide 50: Increasing demand for baseload and dispatchable energy drives higher prices
Increasing demand for baseload and dispatchable clean energy is driving higher all-in prices 10x Increase in capacity prices in certain This year alone… markets ~$50M Incremental annual FFO net 740 GWh to BEP Of hydro generation contracted for 10+ years at strong prices 50
Slide 51: Layered contract maturity schedule is a lever beyond five years
We have a layered contract maturity schedule, meaning this will continue to be a lever beyond the next five years 6,000 GWh Up to $100M ~2% Additional generation available for Additional incremental annual Incremental annual FFO recontracting over next five years FFO net to BEP growth net to BEP 4,8
Slide 52: Scaling development and securing growth further into the future
We are scaling development and securing our growth further into the future +$350M incremental FFO 5% per unit growth 10,000 65 GW 8,000 Advanced-stage pipeline 6,000 MW 4,000 +10.5 GW 2,000 Framework agreement 0 to deliver capacity 2023 2024 2025 2026 2027 2028 2029 2030 between 2026–2030 Capacity D
Slide 53: Robust pipeline of accretive M&A opportunities
We have a robust pipeline of accretive M&A opportunities Access to scale capital ~$100B EV of potential M&A opportunities in the 150+ Investment professionals pipeline Differentiated underwriting and acquisition capabilities 53
Slide 54: Increasing visibility and extending duration of our growth trajectory
We are increasing the visibility and extending the duration of our growth trajectory 54
Slide 55: Key takeaways
Key takeaways Connor Teskey, Chief Executive Officer 55
Slide 56: Key Messages
Key Messages Growth opportunities for Our diverse sources We have a highly visible our business and sector of capital have us path to achieve our are better than ever positioned to take target growth, and are advantage extending our growth runway 56
Slide 57: Q&A
Q&A
Slide 58: Thank You
Thank You
Slide 59: Endnotes
Endnotes Slide 7 Slide 22, 43 • Operating and development capacity inclusive of • Total floating rate exposure is 11% (2023: 12%) of acquisitions and reflect dispositions announced which 7% (2023: 8%) is related to floating rate debt since Q2 2024 quarter end. exposure of certain regions outside of
Slide 60: Notice to Recipients
Notice to Recipients Notice to Recipients administered by the government of Brazil (“MRE”); availability and access to interconnection facilities “investment company” under the Investment Company Act; the effectiveness of our internal controls and transmission systems; our ability to comply with, se