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| Statement |
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| Our fourth quarter results reflected strong conventional availability and the benefit of timing of maintenance, capital expenditures, and other items, offset in part by lower wind resource, which was a trend observed throughout the industry in the fourth quarter |
| So right now with respect to interconnection, we feel pretty solid about the family of projects that we are advancing that underpin the core of that 2026-2027 volume for CWEN growth enablement |
| As highlighted last call, we continue to add length to our RA capacity contracts as strong pricing to drive value |
| Despite the challenges impacting 2023 full year CAFD, the company remains well positioned for growth with a strong balance sheet, pro forma credit metrics in line with target ratings and 99% of its consolidated long-term debt with a fixed interest cost |
| These investments are highly diversified also by off-taker end market, and will benefit from the ability to deploy domestic content and invest in energy communities under the IRA, thereby delivering competitively priced energy to customers, while meeting return requirements and reducing risk to Clearway’s overall fleet |
| In summary, while it's too early to provide details in terms of potential capital deployment return levels, investors can be assured there's a strong pipeline of growth at our sponsor that should add significant assets to Clearway Energy, Inc.’s portfolio to the middle of the decade |
| Clearway continues to execute its long-term growth targets of $2.15 of CAFD per share, and is reaffirming our ability to achieve the upper range of 5% to 8% of growth through 2026 without needing to raise external capital |
| But we are now able to support higher internal rates of return and higher cap deals on the new projects that we're creating, which take into account the elevated cost of capital for the industry generally |
| We have in excess of 15 gigawatts worth of late stage interconnection acute positions and many gigawatts worth of high voltage equipment that we've secured to be able to support the growth there in the mid-decade |
| Commercial operations were also achieved on Daggett 2 and Texas Solar Nova 1 in the fourth quarter, which will help drive CAFD in 2024 and beyond |
| Looking to 2024, we are announcing a dividend increase of 1.7% for the quarter to bring our quarterly dividend to $0.4033 per share, or $1.6132 on an annualized basis, the targeted group growth of 7% for the full year of 2024 |
| Second, we continue to execute toward our $2.15 of CAFD per share target once all the excess thermal processes are deployed and fully operational while adhering to our underwriting standards |
| Our sponsor is working on over four gigawatts of fleet optimization and expansion opportunities with CODs in 2026 and 2027, which are well-diversified between wind repowerings, additional new wind assets, solar storage hybrid assets, and standalone storage projects |
| Once again, I think, 2023 was a difficult year from a resource perspective, but we hope to kind of bring things back on track in ‘24 and see a lot of progress over the course of the year that we hope to be able to illustrate to you in terms of driving CAFD forward on a future basis beyond ‘26 |
| Clearway continue to execute toward its 2026 $2.15 CAFD per share target during 2024, while also focusing on providing further growth visibility beyond this CAFD goal in the years to come |
| So we actually hope to do better, but right now it's what we can show a line of sight on just for a point of clarity |
| As we transition to focus on growth beyond 2026, we continue to manage our RA contracting positions in the 2026 to 2030 time frame, pursuing both value and certainty to drive value for shareholders |
| Additional avenue of growth is resource adequacy awards and pricing in 2027 and beyond |
| In order to do this, we will target to improve availability from the CapEx investment we are making and several of our sites |
| And once again, we hope to provide more color on those we progress through the year and we feel better about what capital those products are going to take, so on and so forth |
| Our first avenue of growth is additional drops from our sponsor |
| to improve availability from the CAPEX investment we are making and several of our sites |
| So from my perspective, I think the overall target for M&A is hopefully more robust in ‘24 than it was in ‘23 |
| And we and other competitors, I think, are finding that customers still see value in those elevated PPA prices, in particular for customers who either as load serving entities or as end use customers see growing load and value the low emissions profile of the products that we're selling |
| But I think, if you look at where CAF deals and move, I think also, you've noticed that hopefully our sponsors have been supportive of moving CAF deals higher from where we first thought they would be given the move in tertiaries that happened |
| Our pro forma CAFD outlook remains at $415 million, which along with anticipated growth investments using the remaining thermal sale proceeds supports our potential line of sight CAFD and dividend per share growth targets |
| Good morning |
| And I think the projects are a little bit too early stage currently for everybody to feel good about the capital required and also what that cost of capital might be |
| Chris Sotos Good morning |
| Thank you, everyone |
| Statement |
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| But for us, obviously 2023 was a disappointing year from generation overall |
| And I think in general, the industry's largest project sponsors have entered an era where we are all being cautious in the way projects are configured and created |
| I think from our view, 2023, I think, because that volatility, I mean, we're well aware kind of where work tertiaries moved and also our stock in the fourth quarter is just very difficult for us to feel good about underwriting during that year, given that volatility and knowing we'd get accretion and being disciplined |
| That's obviously much less than we were all experiencing in the fourth quarter of last year |
| So there's nothing that we have to worry about revising 2024 and to Chris' point, I think overall the, coming in lower than budget for maintenance CapEx for 2023 really just reflect our results for 2023 |
| And importantly, our ability to execute, I just think we had very volatile markets that which made kind of execution and underwriting very difficult in ‘23 |
| And equally, because it's a competitive environment, we don't see an expectation for dramatic increases in returns that are produced for projects |
| So I think those are really kind of a lot of the points around maintenance CapEx is not a question of what we thought it was unfortunately due to the generation kind of being lower than we had targeted, maintenance CapEx is also thereby lower and really kind of putting those two together |
| So maintenance CapEx was not needed as much due to lower generation |
| How would you sort of frame the environment right now? It seemed like it was a bit of a buyer's market last year, anecdotally we're hearing it from some other peers that things are sort of pick up in terms of activity levels, a bit more competition |
| So for us, and also, I think a lot of sellers, we're kind of waiting to see where those markets calm down to be able to move forward with sales |
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