Ameresco (AMRC) 2 Nov 222022 Q3 Earnings call transcript

Perfect. Good day, and thank you for standing by. Welcome to the Ameresco Q3 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. advised conference be recorded. is Please Instructions] that call today's being [Operator would the Dillon, today, hand like SVP over Marketing. I to speaker conference now to your of Leila ahead. go Please

you and everyone. good Thank for you, We Haley, appreciate call. today's joining afternoon us

George President me Vice President President, and Hole, Chief and Senior Vice Financial Officer; Chief Ameresco’s Chief Joining Sakellaris, Chairman, Officer. Officer; Executive are Doran Chiplock, Accounting here and Executive and Mark

risk Please regarding to two, refer call SEC the regarding make discussion in filings over to remarks. would from contain I materials the to statement Safe forward-looking today's our statements major cause statements materials, a turn those George, a statements. and that actual are risks our like Harbor factors language differ forward-looking our brief subject I could forward-looking All results our including earnings on forward-looking earnings Today's to Before statements, uncertainties. for and slide the to of expectations.

when results. use several In our presenting non-GAAP addition, we measures financial

have George. We now over to call our in the turn I measures to financial these information. supplemental will the George? included reconciliations

Thank lines, the team four in another you, am of everyone. afternoon across quarter growth performance revenue driving business Ameresco an excellent profits. with impressive of delivered and report to our Leila all good pleased and that I increase

of made have March. end Investor great the We progress at since our we at Day met

expand markets internationally. addressable both to our continue and We domestically

assets our energy and grids. of You storage micro number complex incorporate comprehensive will and advanced notice an that such systems projects more technologies, as increasing

we water lighting, smart In and are for buildings, deploying addition, solutions systems.

Joint McGuire are the White projects at our energy green State savings largest of storage of Fort side, the College, Sands the $XX latest the asset a great awarded technologies will which our energy examples at and megawatt-hour contract energy be five critical advanced projects federal Campbell recently micro Colorado. Our performance battery Missile Range, and Base recently the announced strategy. on And subsystem supporting million at combined system Colorado megawatt customers' PV we in XX security Mountain both

partner expand pressing need for in continue spiking where prices. were we situation selected also given a in business megawatt This for quarter, as us XXX beginning. in PV there the local Continental to we energy Europe, only contractor projects largest third We with represents Drama, believe our the In clean a solutions, geopolitical for the in Greece. the energy Europe, and together it's is a project

other the R&D with organically class strategic opportunities grow of We asset a expect this growing and significant demonstrates both activity. robust in through Europe, development are investment assets biogas with in and the and portfolio the Ameresco market is experienced players of operating a and activity importance interest multiple industry acquisition Recent acquisitions. pipeline. and aggressively pursuing and of one to we partnerships most large

two we driver RNG an quarter, to will plants clean tech value assets Ameresco's important We significant this continue added and is and be Just a our development. to RNG believe shareholders. for that solution

to legislation development more, for affecting incentivize U.S. Act, energy approach We create neutral energy will XX-year solar, environmental XXXX. only bill reducing runway range amounts This environmental a technologies. goal provides technology efficiency, tax energy with micro of vehicles, carbon performance emissions, increase wide objectives. of The company's reduce IRA energy it the XX% energy includes enacted a the a storage, provisions emission that and legislation creates a many by innovation, the by the IRA, approximately in security, the to emissions was incentives, the revises carbon grid, energy and Inflation but third clean also tax ensure most quarter, electric to not support founding. Reduction fundamentally of The zero also energy support believe clean long-term code be incentives our or since impactful of which unprecedented justice

Some to for or tax squares our production business specific micro to include and tech energy projects, heating clean and impact -- also vehicle clean direct hydrogen; clean on renewable energy expands and biogas, well electricity have investment will zero for credits including geothermal efficiency ID It and carbon a carbon as energy charging tech words; grids, the our that provisions reduction. electricity credits. XXX cooling; tax storage, standalone capture as infrastructure and

While we and incentives, be great to other business. breadth our it depth to the grants, still of bill, benefits from evaluating a long-term do everyone the tailwind and is expect this

With solar our We two have is customized and to time well-positioned benefit already grids, these identified key natural along on from and with renewable though, partner solutions, battery bill our Ameresco. our directly infrastructure, would storage, gas, and some electric of Based customers this a with micro number Ameresco a ranging materialize. similar this financing experience beneficiary vehicle to long-term and of ways legislation, energy anticipate our benefits take industry be structures, innovative will we legislation.

on underway. Recently, adjustment. an early the to update the California in project. to terms We costs a with are the XXXX. to progress the Southern the we adjust battery of associated the however, schedules all like steps recover provide into and Under would on commissioning schedule cells I entitled us California project contract, Edison Now, containers site made with Southern in continued Edison quarter instructed

these of the and majeure prior applicability costs. with earlier, to the California the and we Edison regarding and the estimate to projects disclosed continuing service the of anticipate by Southern scope Considering We're requested We relief. substantial adjustments are and in summer scheduled XXXX. discussions any also Southern be to working delays completion analyze California Edison force achieve

to to I time. Great a our relationship employees the Doran we not to ensuring even comments honored employee more making the California X,XXX the is as and would that and thus will were of to it to work, to cooperative. critical I the industry. retention very great highlight it Place on and some our reflects make in become the continue based for positive company's the continues performance. meaningful now entirely input, Southern like company Work-certified is our will a Doran? over Edison quarter, This for third that be on retain designation Our experience we we Hiring to with turn best the to to over place growth brightest call provide to attract financial and employees. Ameresco in first strive

you, everyone. Thank afternoon good and George

additional refer the For press the and slides release after our financial website were posted information closed please to today. to that market supplemental

our team quarter delivered George As business business. as four the results experienced by Ameresco of lines excellent of financial led all another solid projects growth our noted,

our at close to project by expected O&M as billion, and projects remains during contracted visibility the combination addition, execute and growth giving economic backlog led the our resilience businesses continue asset we of uncertain In our times. energy on SoCalEd was excellent $X these Topline business to long-term revenues us projects. future from and

especially continue it growth value grow however, we This experienced our for this We're growth only this megawatts megawatts early and the our to XXX disciplined are we revenue integrate solar highlight to and where contracts O&M our third-parties. we'll stockholders. focus pleased now over can under acquisitions, and very projects, opportunity manages XXXX, in XX to government. Our O&M Separately, business also of on O&M business approach with attach the I'd unit like business. acquire When companies, which create nationwide for management. of business as we their line to XXX acquired had with federal strong megawatts, solutions, take this to almost

for other increased saw PV performance demand This line. energy growth was also solutions from integrated oil access part continued by unit's is seeking We our industries, the driven strong and from where the and systems off-grid grid exists. rail, of which no revenue, other gas, revenue solar

ability our the cash, profit with with the the had of continued to revenue a mix. EBITDA having of capital margins increased add the we year-over-year We operations in needs in our the direct $XXX as from fourth operating the We dollars GAAP generated double-digit lower leverage, achieved company a contribution As to million lower from Even in very anticipate expected, similar execution our overall projects, quarter operating as growth result basis. million a working gross sequentially adjusted SoCalEd available without in the expenses. demonstrating the quarter. on $XX incremental SoCalEd adding margin strong again margin contract gross gross cash ended

ESPC Our adjusted $XX which into federal million, account takes was proceeds. from financing operations cash flow

This We SoCalEd the expected was anticipated one amended our needs. our the early near-term impact will from of onset projects and is capital senior facility working in continue why to impact we the year. credit reasons the

from focuses activity business to at normalized C&I of the more working We our SoCalEd segment for the the as the metrics. amounts market note, components levels seeing backlog we're the $X.X sustainability quarter. collection was of expect contract, a to Off completion project sector, and Total healthy owed. the of with this all increased remaining capital billion end return on of the

the addition, Ameresco megawatts. asset our amidst XXX business lines of portfolio and ongoing to XXX it's Europe to In and pipeline projects building owned energy energy megawatts, in to assets assets operating crisis. grew of development in while construction continue its grow

should energy to increase asset continue newer energy equipment once the both as an are prices total deployed we help In our understand expected our storage net returns de-risked, create long-term on a performance. our metric. sustained This particular, proposals of in types greenfield early expected better in positive and well reporting originating energy opportunities, reminder, megawatt been assets. partners' by pro now assets interest a Ameresco. awards a future have group our with investors stage solar interest. as and in inflation, development Even would which As are assets seeing assets financial variety owned grow has these development rates total the jointly front-of-the-meter increasing for equity and high for our impact forma after development We're for to favorable adjusting cost nationwide

strategies senior our years a a stack, in opportunities was debt is secured some of of of discussing off. accelerate. The to incentives pace time I Furthermore, greenfield About the non-recourse at at of rate team and our couple continue this our of of With in with experts swapped portion time our pleased began important to our variable facility. this being it see increases background, only we of that results credit closing. we're is either ago, pay part rate these will For capital exposure. the we development structure starting debt the spend XX% fixed of expect from rate IRA, material or the debt is a interest is organic an bit investing protected to as will

projects Higher results. balance receipt projects should this of limit the greater is to the debt have associated implementation have on interest project of expense. our any consumed The project the with funded have meaningfully potential higher impact to the the majority fund facility our the third-party to bank customers under financing. rates has increased percentage completion energy our reduce potential interest While the interest interest sizes, higher of expected medium our of This SCE assets, rates of impact on the as and looking projected potential business. proposed their contracts affect or performance following under new energy interest also by equity financial payments. contract, of due when a facility execution at savings decrease is cash to the Similarly, of rates rates Higher long-term returns.

environment pace returns believe factors materials, both macro-economic the energy which of the energy change renewable project very to and continue with in based our year. positive particular and diversity this monitor approach. seen pleased and remain our outcome closely our XXXX in these year-on-year energy have compete hard model we asset preserving to electricity the risk and gas, of adjusted increase business natural disciplined and increases However, customer We're customers our the the team. Ameresco resilience challenging work to reaffirm project increases businesses. so costs of costs, both and our financial ourselves Ameresco's our ability do and We labor, of annual balance in and a against price which to the energy sources, economic today's guidance, projects our speaks outpace all-in dramatic delivery These for in assets on in and traditional is

end to achieving years, million for we we and we our stated strength very guidance plan and goal We QX. adjusted in in of of markets EBITDA the provide when previously in model of confident XXXX. report our remain optimistic $XXX remain past for As XXXX business

call over I'd for comments. like the back to closing turn to Now, George

take the to years around for Thank growth are outstanding nexus execution. climate, you, once us the moment this a tech comprehensive want Ameresco, customers at and again, to and positioning to issues facing to dedication team for important of Doran. for entire Ameresco address come. our to trend, budgetary I taking globe. the robust and their thank with industry portfolio now Government steps of solution our geopolitical, is clean

We support long term ongoing also want and customers to subconscious. of recognize the our

March, welcoming Finally, Ameresco. again following are investors in about once more institutional we our successful learn Investor Day analysts to and

We tour renewable will this it Arizona strength Ameresco's natural will the plant be impressive US. business. tour only on the RNG Phoenix wastewater Facility the open largest at November is with This biogas of a understanding not now R&D this also We but would in hosting Operator, to provide hope gas questions. deeper our the call facility to I XXth. like to treatment facility,

Instructions] Kaye question from Thank session. you. from question-and-answer Wonderful. time, line and we this Our first [Operator Oppenheimer Co. will At conduct Noah of a comes the

led IRA terms really to and last following of --The it's of couple changes. the passage of where in specifically months the

one on All hold ahead. Go Noah, right. second.

Noah. question your Ask

much. very Thanks

Let's you little on the really maybe if have where couple as out like And or you last for IRA, a pipeline for see I remarks, start thanks that would up, taking have And impacts of wondering areas in the that through look further of on Are touched picked growth us to of picked again. the a impacting go of you the been the potentially months questions. that what customer focus there the highlight? prepared since terms couple year the you up next where opportunities really take the was do two? where we you? bit has

to question help Yes. traction. to tremendously. And a going about it's the no bill, it's some going great time that's us it, take to get And

The back -- activity really the to recall, months at to where most faster Obama six plan on going. I a the at you we the we even else. take pace say, accelerated; is has when get had it base. business us took XX recovery If see like But asset everything administration, months than effect will asset to

for the and debating Some rebate other of cogeneration ITC, the thereby they take take the own should and the -- of the the themselves. example, some the whether like other items they now words, own customers facility cash, that facilities monetize

the bill. two are take it's out you I how months to to the So, best and figure want the trying Doran, associated old think customers And to-- advantage only with

say with going has involved clients We're mean, and a analysis. the that Georgia I focus pay. side business of last be. I not is that for our with of of the amount on question, the No, right, you the to direct asset couple tremendous know, especially working is the is months would where base And several asset customer has government lot profit. of a

was forward got of the goes also, things. term, to right, battery and we've of guidance direct clean the George a between XXXX, you what pay, require right development a the solar great list And now got different sort longer So, asset comes On conversation. in lot to alter in a it said, I biofuels, expect Certainly, the would how And and we ITC, continue electricity, our look be means lot then emissions, going the where what tailwinds to of PTC, mean, to customers what to the that all got do assets lot that of for zero economics. ownership and of those business. on, ITC, then own of planning. the to a out. considering as we've immediate topic assets, have this the when the with do the we

there's a And how out know of IRA mentioned and recently, projects deals we pipeline. terms if been landscape how you Yesterday, level assess, could procurements. a RFP with the of particularly a about opportunity post RNG development, your bit high event, incentives, of probably the landscape just see of more the market but high you at the their new set shifting? the and is Avista about [ph] biogas I it in a to do the wondering now talked profile the color. helpful competitive couple the for And I hear come us And little Very adding RNG? guess, RNG kind around bit you little you give couple activity. investor we'll

some great, think the in valuable on pipeline will juice more higher, XX% and some derisk. for substantially report But a States look -- us, put rights it's them a catalyst look, gas won't actual have but agreements, development we have is -- we the our development deal. is great We we or on metric, great pool negotiate pipeline with assets pipeline in gas. working of natural so and and we've development I and we in the been lenders, so the get into as United as development forth but you if the at

in we why a business. facility NextEra, in we bet making first decarbonize for companies XXXX. great Difficulty] the Antonio the someway getting this help back good We is Somehow, because backlog. you having call a started, to into into that's and that, when going think us even going it's what were visibility, catalyst have RND we on our but San great, to IRA, the of a step have raises is the for short in more. down build the first on big saw [Technical And marketplace, record market the business within the we're what pipeline's not track back and I And we to our what's going --

I delivery does everybody. can to you that about how everybody. Maybe us project the Thank How Doran SEE delayed you with, bit the hits XXXX. Two little income start impact mean complete project, is that things. tell Hello, a to statement? the

the going of to those substantial to the move of in still the to we're overall think the of assets then are I a profits, going generated kind what be statement Q looked our XXXX We're end So, of be we in to year and into the going sorry what terms XXXX. -- placing the accomplishing and we in is at project amount make revenues operation. before

think the worth total. into million I million talking we're out $XX of of maybe revenue to $XX of about push XXXX out a

a tiny number, not substantial So, a but portion. not

Okay, guidance, That's curious that that within else there's great. some anything just helpful. gathered if guidance changed. behind was I that but I the from And

in to The next can an is facilities on on front, for and XXXX? other on give and come the stream update us RNG timelines few thing you in operation quick the just the XXXX

one mechanical end the to of will that we out most be want plants, the And XXXX. year, will takes mechanical four the the point though, Yes, the have two, quarter complete months on. I really first the of likely it think commissioning the three to by the thing we year complete, go the other they through we so once and get to of

you -- revenues and in complete. generating us, it's months permits for environmental when four some after even did delays, then and we on mechanical so put So, before, income far We -- in the end though encounter some building we permits, had some the equipment mechanical site of as operate then that the by the said, five didn't had we'll complete as time. plants six to show up have for And three, XXXX.

to visibility. We that continue maintain

Wonderful.

comes All Eric question right, online. Eric, from you're Craig-Hallum. next Our from Stine

two the in in just call, update if hear Europe. on So, the last U.S., we about in projects Okay, that. an can maybe And you potential talk think I'm you me? talked just about similar one I wondering Bristol project, can the

ones? on So, is new how these going, the then update just curious but initial project

to what they in mean, look, actually, process, going. one on where XX-year get Bristol that's took long-term, we it's it have. one to out some years most get it's of And the we takes into point I we are exciting series. And a projects the order Yes, today concession. other that like And it particular over to approaches But a have several I that is couple that is two City. of it are with to And years.

over you've So, years' though $X it's -- £X billion well XX period. billion over identified even investment,

showing start projects seeing some up. So, you will

start to moving they up were but will started some our -- they showing Some we the city asset, EPC, XXXX were the us. transfer of be is along. for will that are, be We second unit everything quarter working some not working they will the until now over people way for they and operating now

going moving not talk along, So, about year. but next to any we we're to early seem have

term-- longer okay, Understood, Yes.

project, year £X this horizon. a And though particular even large, it's billion, over just a it's it's not

it quarter going every talking not in was to about we $XXX year. California, in but Southern we're did be because California about million, get we much as Southern So, implement over one like to

was that So much more--

Understood. Understood.

interested mean, -- what energy in what then And just that also there. thinking talk potential obviously, you're landscape the but kind about maybe of wins organic just Okay. acquisition the Europe, discussion, the your I implications there, in seeing, just through and be the side? would are looking are at? just of assume out than what's rather there these mean, might thoughts and valuations in terms but acquisition what more large, you I going strategic mainly the on some I be bolt-on to

Eric, different that I than think our isn't else. -- anywhere is strategy it any mean, I so

something just our pushed far At across this if not multiples. to different look into We well. strategically asset. business an the watch fold As concerned, that be be are that time, we we're -- acquisitions it. that there. for as team. of we in believe businesses lines going I in talking for of that we'd We types like about -- management to point fit looking think over We And is all evaluating EPS can Europe all accretive overpaying where we the we're for we're we're had opportunities we're

All Perfect. guys. Thank right. you

is Canaccord Our next going George George. coming Gianarikas ahead, question from from to Go be Genuity.

portfolio your directions? everyone, follow-up M&A in should from think sale how mix that assets. portfolio your good had question. as and willing trade match, the on you just management Hey, taking we thanks and about activity I'm to capital my afternoon, about take you recent space. How to redeploy of and Are a other for think in curious the a I strategy?

revenue whether paying people the in with so But this out power on. the some We assets the time, tremendous at or and asset available it's all we always having that turbine high margin that with RNG, options point solar backlog having are there or and especially that recurring prices of associated for the the evaluate good us very EBITDA and own, associated gas, doesn't with that we where that. feel are open projects all we And to an think have. that we mind. they more little won't good And some pretty maybe cash. mean to I there's Doran we green that table refinanced But to some better options evaluate right And of come add that want stay the now. the color a bit we

Yes. few did of a I operating plants. we mean, refi a of the

I think to of that important owner I'll add the point assets and George's going comments asset those the being optionality one is controlling forward.

a there's shareholders. and for like the of to renewable relate gas, in own our as the they we way we really accretive strategies to and exciting variety had so go of most that looking we're the at you lot front coming. natural the deploy year-ends there are As that assets developments developments on can pivot a that We've see hydrogen of different incentives them

Reduction and your elements we thoughts one renewable for get changing Act. the Democrats of just potential the how with risk you change Inflation just Republicans a the us And lot associated of share Congress, Congress Thanks. Can Inflation more on and follow-up, in of of any XXXX? complexion to questions certain in change elements the Act Reduction could i.e., on

I but Reduction there, say, this I'll mean, long changes we to any as splits Inflation well the whatever it that's right low you're you previous don't happen, with going Doran But and my is that. this administration. And did I Congress, Act, now. if I can give politics, feeling, President will we let's as much, see the to that. the might or think say in under give are very gut Look, not

have is the everyone. and pretty from climate they good whatever a states commercial The and more. the we moving. runway happens The to industrial, impacting we Look, de-carbonation, are. started government, change So the where federal more

be material we So, don't we I a going think a add to we as about we but there's think change. lot cautious are Doran, mean, you color to to some what doing, and more are it there? want

George. bill the Yes. and crystal politics to two that of I that dozen page that out provisions mean I happen in apply election to to of the after. lines, still breadth But post-election. agree with left three have going I a we're us, a or going I and I not crossed going lines We're of what's the at the if stare areas ball

hard So don't about right now. think thinking we're I that too

think on going to I us. that's focusing in there -- we're what's work

Perfect.

Our next one question All you Christopher, hold on from comes Christopher ahead. Souther go -- right. second.

going if region, Maybe meaningful the try -- Thanks here? the your kind you be you're sheet, Excellent. question the maybe for are be you'd mentioned front-of-the-meter would solar far balance more a new that Greenfield part as, And here. strategy what that to is taking working area a high business kind of Maybe the and that capital needs my of looking assets some own and just for of on projects became geographies at as any you specific of you could of after. just level kind these share?

Sure.

lot a So I think stage. there's because of it's Greenfield, early

direct position. and We of are site variety interconnection markets. a to going queue It's control

and tariff we feel those solar generally either other like ultimately, like that speaking right to amount that ones asset or and portfolio. some community that bring anything development solid the our think on focusing value. really of program assets as asset grow the creates into are have metric We The the with we'd approach we is

consider we if opportunities a not arise, community we going value. aware market sort ultimately working of said, and we capital. are DG. of, being mentioned I out there aren't there's still the And going this can would, those why types to meet are utility say, substantial if with That after for hurdles, our scale. then That's assets solar. would I substantial all We monetization, sticking create We're of as those of large return assets course,

so deploy that to capital early-stage front, build interconnection, different assets the non-recourse contracts, to you build in development your help to going reasonable. kicks finance capital facilities, working that expect us we going through development the The working and no so is a assets On substantial would construction permitting, revenue through than on when capital go the fairly all really basis. now. not establishing working and bank facilities We that's

it. Got

Okay. sense. No, that all makes

some XXXX of the at ITC And started might solar more a projects to kind potential included year, the into order like to a to Thanks. megawatts for momentum would that was the be there if little XX juice first of in the slipping any was looking on to and to get I of whether sense or wanted XX on there any bit get So RNG completed be we front? there? facility the that need just in be

specific there, not about is in just included to Nothing that figure. the Yes. RNG talk

So at any plow there. for feel the just But to we're we're sort construct pinpoint pre-guidance and any complete right of reason. couldn't like as we wanting the specifically delay IRA, with other the have of just looking I going ahead ready. what's we identified assets Currently, that to

Perfect. Thank you.

from Tim next Blair. comes Mulrooney Our William Tim. from question Go ahead,

Can me? afternoon. Good you guys hear

Yes. Hi, Tim.

Hey.

XX%. last were like project of a blended energy that data up So for your said up blended XX% only costs you were gave XX% to interesting you year-over-year, costs when that was point more kind really quarter but customers

others interest be you what have to could I would for a you given update continue is flattened customers now, up. while for blended costs gap maybe see what compelling, that wondering pretty enough your like cost rates out, may go so provide if So project was an that for right some

that economic think, in for putting we're putting today. trend for data I think and but a outpacing. understand the the that proposition energy remains we look forward. -- a I importance regular I of in I on that this of in think start at to customers in that basis assets track was, movements internally, critical my have And fact, something as put and that you The to of value But folks it's are it the move point way any valid. continuing to Yes. I the updates the not comments -- taken numbers, front don't we're front the we're recently. on We've still I the we mean, with our fact ourselves publishing expecting is was the statistical

would to Are XX% rates can't today, whether try interest for for just know, until signs, project any in behavior different I'm interest you seeing seeing projects under you customer come have tougher impact any that right the the back somewhat? material to suggest longer curious a you're environment don't guy is now? a business Doran, update cycles demand XX%. changes blame trying. No I'll down on higher control inflation question. can if and sales I a Okay. maybe or rates

with to seen I bill they're The trying that have everybody make going is to that. tell this once will of they're you which they going ITC thing projects how haven't. XX% way pencil up little projects a co-gen figure of we're much, even out. utilization only the We like although out some maybe a we now of maximum But penciled go, bit more, the out, they before couple and to to -- lately, the

they're a project? change customer, going So, it. particular that we're seen out, get other because climate market. figure which of now haven't we the the seen wanted what So go to sector, day traction on proposals that way de-carbonize, on to trying the to in people but him we six C&I But more we have gave the for we the

[Operator question. ahead, All Molchanov the right. now Instructions] you right Raymond Our James. your comes Thank next Pavel from from Pavel. question Go for

for taking Thanks Yes. the question.

SoCal best project, projects low-margin, of supply this the issues kind own been have Edison a pretty look on effort, no taking the through the at obvious the back there future? not may surrounding of course, this idea as As Is very lesson your high-volume for it's of is chain. fault such we be that

no to resounding going on say I'm that. a

of substantial our I any operating types the reflecting of those way on OpEx when think base, things, without -- numbers, we're in these it's leverage. increasing take we types

proposal multiple very, feeling know our de-risk know possible. seeing with around we in we're developers not that which going we're when here utility we're across our maybe certainly to have realistic. but So up, seeing And conviction, comfortable the activity, we quite and very alike customers come the the and after those size, desk. because cost chunky ability with types execute We're chains the seeing We know supply like are projects what's now. ones some country. projects, of similar for We what's

that, going storage a addition that will battery a coming bit over of to now industry. learned heads, of in the for that play see are of ITC Yes, a And great project. years We particular in a project. lot stand-alone few to the you reputation the that into sheet balance with because my quite for project. us because other talking and project, one into we And established our next a utilities, they few

up. remiss part mean we'd other intermittent in mean, to a going offshore coming East renewable I industry resources, our storage think in to be Coast, not forward. grid, the on with going the is is critical here integrator resources wind clean after go picking really tech increase I And overall I that it. that be everything, that's the of the

follow-up that is and What A X% number time obviously, was the you the be Europe over? by revenue energy XXXX, in crisis. the will about this Europe, war your year Okay. do think of before

don't know any I to to going -- that XXXX. For expect for Mark, I anything have don't -- we're XXXX, specifics just substantially do you different

one me Give second.

One a we're take Pavel, going to quick here. look second,

an see some from and But XXXX. seeing substantial it's we're think but increase, a increase, XXXX just is this to year-over-year We'll timing. not growth I

Okay.

to XXXX, bit XXXX, year-over-year our little we that revenue to of of modest XXXX. and going increase from growth portion share of XXXX. we're project a that's a PV is seeing XXXX So, through, come the start that announced the in

see City start will also in. some Bristol then and of to that kick So

UK. backlog good we pretty have of then operations. And in rest the a the

will up you picking next it see no, year. So

good. you, Very Thank guys.

Thank you.

Perfect.

Our of Bank is from from next to America. Julien question going come Dumoulin-Smith

me? team. Could for Thanks guys time. you hear afternoon, the Hey, Good

Yes, Julien.

ask the convert Listen, existing -- creating the to the ITC? efficiency given first qualify guys. projects I of of wanted to Can conversion, stand newfound most to we've to given then how secondly, think you up today, conversation Thank ITC about in you, well, around you here on looking the these you late economics? and RNG mean, on mean, seen follow and to off, I I landfill potential garner maximizing portfolio I the the leveraging elaborate transactions do some electric that here. as to for at RNG

answer we it about is think a the Well, lot. short so

draw optionality to our of front going asset continue you see for that I make up that alternative to we of some and PPAs of the eRINs feel to some you will one-by-one And of be site mentioned, preexisting account was sort the these the We when of permitting. that focusing We As interesting all behind of now. we've that those assets are are we certainly contracts announced. haven't as may see on for and programs of a for good about lot the actually sites developments gas elements fact from the and that existing for new I And all some the ways we There's metric, forma go, kind at we to we're new development that look of the to talked of all that looking pro about these very where But the RINs that of talking that different of number our we're we're about the we these I previously of of applies -- introduction in like to where as assets. a those far about on XXXX and ones out be RNG, matter. potential the where paths going that some the think sites to in developing that, we potential a how development into optionality various the moving laid evaluation economics before. We're off assets are basically negotiation think ITC, talked for portfolio increase rolling control assets. in where to evaluation we're said, concerned, XX that assets through of that go. profitable different got projects areas, given of -- at going of a funnel to we've sites work the about talking it take to already are take

existing if especially pass, have to electricity. that the eRINs plants and XX-plus the eRINs the we if come come Well, with generating

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eRINs So it's some think it I us. a great own great value pass, of be to time And a would assets. come those to for if creation

growth. I negotiations, goes. XX% you understand credits. will, delta you a the you have to I to the was may the some it forecast, fully ITC IRA prior earlier projects given But your you'll XX% as passing. guys think I inclusive can you specific those not you and RNG piece Day benefit little would a if these better might RNG of year, Day it. as share already, update bit Got relative to in came Analyst your seemingly, in ask clarify with that the that. at But this that numerous of had to of year the for that reflect of When But be a of earlier pretty -- do presumably, Analyst when to to position least be the some mean, you And or sizable from you forecast -- outcome the this

out probably we that come think when we'll talk guidance Julien, report and is content -- when we XXXX QX. about I for

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The Instructions] He ahead, Research. from question comes Greg [Operator next Greg. Wasikowski. Go from right. Webber All Perfect. is calling

afternoon Hey, okay? you me good Can hear guys.

Hi. Greg. Yes,

SoCal Edison, for horse a Thanks Not just beat here but dead to taking clarification. Perfect. my question. short a point of on

of you think think you to last Sounds any service would of like schedule the the sole the their guys was completion the have -- kind to adjustments update? XXX weren't all kind megawatts do or strategy, which there adjustments discretion. with of do year, of at by made if were But quarter's now XXX expected end you

projects. The have in that and what could respect type going we're multiple think of really go to don't is there of nuances discussion been. across kind I speculative with to of

comment So I yes, go just a going to on think don't -- I to we're that.

minds -- what alternatives Understood. Totally you more EV it's or that's charging integrated maybe comes like the fair you're like seeing a RNG Could and battery cells what now? Switching fuel solution? or Is are about smarter top just are there and strain that software it guys solutions are to speak something of grid, the elegant the fuels whether of enough. alternative solutions on hydrogen question. most technical out your solutions a on for And seeing bit or of when it little a incorporating gears you about to as thinking right the customers?

project we incorporate we test to so we and federal Well, on. what on right when from ago. it couple now, We going we did and X.X we have great and in a on of back government, universities Tesla electric in and vehicle we a on. charging stations hired colleges group. then, stations, with every the did the now And real project to somebody so the every years the both And do do specialists on hire this great create greenfield development experience charging

we active of So And XX that's where won RNG hydrogen. next station to over in then the area. be very going fuel we'll going fueling part XX that are to the contract And a months. we to for have happen to a convert

eRINs. of of fleet charging integration the Yes, the from think Yes, biogas gas projects our but the where I opportunities. ability together. those electric integration also be connectivity away at consider front, projects, in the batteries. might surprisingly, the federal that to we the renewables. -- put many not to ourselves a We got or looking kind vehicle landfill at some of of be of by to RNG driven just to are we've forefront hydrogen, regions, mean or Not on the lot I

in scale business our at technology overall However, that's of deploying that its or a early development the of carport part solar installations that's the installations beyond is stages. kind of

for Wonderful. you Thank question. the

Joseph from the comes Osha question next Go from ahead, Partners. Guggenheim Joseph. Our

Thanks. questions. couple Hello, of there. everyone. A Hi,

some First, of in one. your up. Obviously, I'm you cost curious, is financing Doran, terms business of follow-ups. how And got if simple can spread of of capital? wondering alluded into incremental cost I've your that a hurdle going project I your hurdle about all rate. your you do couple insight just think rate of to get I'm just is a evolving? then

our on interest relatively fluctuations as constant the are that target years, assets balance seen is We've think kind and rate over that remaining hurdle I ROE of for the a sheet. mid-teens

battery, As types with of or situations sale different move you returns in leaseback very look like at the those high by around to might getting When assets around tax on advance asset look an the expect, you're levered tend asset when where you quite class substantially. to solar, in those rates basis. you equity, RNG, class the tend hurdles very, move

portfolio basis the the a of kind about on So way is thinking we're that.

does. your it not funding not your idea But hurdle response the then is does But your normalizes, necessarily? debt to up funding what time, it of the and cost Okay. over moving rate your stays in -- of cost same rate just here you're

No, necessarily. Joe. No, not

bit. little question, Julien what Thanks. then a the Okay. getting was And second I this at think is

the perhaps put structure maybe now? for kind capital around have the it you R&D off-taker say, a One ability different right? project, utility see past relative of the more utility one favorable that the an just that more evolve could favorable were right? it a of a nice is that possible that's off-take is things of RNG and capital wasn't grade and you be, things one what XX-year here, as to a get the brought is out there, grade outcome off-taker you of things with a And little So we structure to up one, XX-year there, pricing in

kind So taken coming has of floating of right? right of lot around, see, a That's though, right. as different the environment, we seeing account, contracts at XX-year. Those yes. a incentives price, leverage, XX-year the the parties We're developments, lot Joe, table. of lot from a the transportation consider rate the aren't be project Hey, looking the course, to interest obviously, to away different of the the same into a Everything you're can at to and as you market. have that. financing five-year, higher When

the that long-term it's that watch So if a right very we in comes market, but the contract along. closely market calculation, still so

will pipeline. the we they Yes. talked utility, And Ultimately, their come, decarbonize it about gas, the think to we have it because before.

that we that But because execute it's We time. come agree will better longer-term So it matter market, a will monitor up, contracts. then with prices we of the will we you feel and financing. constantly us give that

Our next Instructions] from Baird. Ben. Go Kallo question Great questions. All [Operator comes right. from ahead, Ben

Hey, good everyone. evening. Good afternoon

Hey, Ben. Good afternoon.

Hey, guys.

more a makes So get as that deal it with hard is the complexity for lot like about as just thinking products margin? execute? question you that, you how projects get gets a just get complex, I -- we maybe do the guys complex a higher Or and do to

Yes.

the way depends the into Ben. complexity it So on risk, translates

basis. look we pricing risk-adjusted on So a at

into. a are not margin. It's in lot more to the factors think, direct addition higher going I the the the of the relationship So, just complexity that technologies there's a as of just complex, different

want that we might customer pencils we that the part lines, need nature speaking, execution, account. of than to in yes. it we And complex sharpen kind deals So with overall then if of more projects project. complexity just guarantees, customer sometimes risk to If the right? you then time business, the of might course, You've it's more got have right? win whatever type generally about of do the all bit that's And performance more on pricing then, competitive that our it, into little be, the risk But complexity. a think associated we of and take

happened, is it give gets The the that much. what profit, can project. many gross larger and overall a as the competitive say, would project margins, But good. provide too gross us, that contribution the the advantage, far the particular profit complex people that I on to the holistic project because margins, very, change profit not very doesn't But approach as

do about Or that? pause now do we about there How backlog? backlog? and big think a your increases think -- we how how it and then Because is grows, get into the we right with Thank you. IRA,

call that Yes, talking making we're the because I on which in clearer to ever to bit of more contracted. six stage go, little And the traction get we they the the proposals order it pause. go, to said once usually, people right time to business of because more a another award, will customer earlier, going going which like is to lot Actually, yes. takes used then I to XX to takes they're of customers get moving the another. to little faster. it months evaluating, a take of activity. but more But months one tell we now. to from go it we're XX wouldn't And to that part move than But the -- before, to this and though, the to kind options There's asset go. it's a we bit to environment, way are way it's in

your in program. Thank Wonderful. conference. participation right. conclude our you, for All everyone, does today's This

You may all disconnect you now. time. Thank your for

you much. Thank very