The AES Corporation (AES) 4 Aug 232023 Q2 Earnings call transcript

Good morning, everyone, and welcome to today's conference call titled the AES Corporation Second Quarter Financial Review Call. My name is Ellen, and I will be coordinating the call for today. At the end of today’s presentation there will be an opportunity to ask question. [Operator Instructions]

It's now my pleasure to turn the call over to Susan Harcourt, Vice President of Investor Relations. whenever ready. ahead go please you are Susan,

Thank second quarter Good morning, to our and welcome XXXX you, operator. financial review call.

presentation at release, on press and information financial Our are our website aes.com. related available

on GAAP forward-looking can XX-Q Today, we may website future SEC. filed our our which with to results most There be statements, between many materially these discussed factors the cause from the statements. and differ are with will measures presentation. that are recent found non-GAAP making financial be in along XX-K Reconciliations and

Joining President management me and Steve Chief Gluski, this other morning are Officer; team. and Coughlin, Andres our Financial our Officer; Chief Executive of senior members our

over that, Andres. will the With I call to turn

call. Today, will second everyone, our well the our results financial performance strategic our and as more I as outlook. you give quarter Coughlin, Steve on morning, and progress CFO, our our financial thank will towards review some we're second objectives. making excellent joining discuss Good financial for quarter and XXXX detail

For for much the earnings expectations. $X.XX. year half very tax the was attributes with per rate line our well share quarter, metrics and XXXX. Results with $XXX through of million, our Thus, all was targeted quarter for the we're and adjusted as are as first guidance adjusted our reaffirming XXXX in the second EBITDA for annualized growth

year, of of XXXX our XX% earnings this in approximately the year. half earlier the come noted second we As will

by first, our to renewables target for XXXX. is Now with our on on, capacity priorities. our core an update new installed triple strategy the strategic a focus At of the

invest XX% the year base our the we our years new that coal define industry U.S. as transformation by we for the XXXX through expect technologies XXXX. Second, more to increase utilities, third, and our of the end where come. growth by exit in to portfolio will of And rate per than at

beginning focus with each X. Slide our executing update how Today, we renewables areas, an these I will of are on across on provide

renewable continue specific us. well customers interest believe for customers. projects reflects significant of U.S.-based this ability as from with needs projects as to large on reputation best-in-class do the our see We tailor key to time delivering our to We our inbound consistently wanting to both

Project gigawatts have including Year-to-date, gigawatts second Belfield or in since now sign with the feel X.X include gigawatts could new from gigawatts of gigawatt Hydrogen we X.X end. of Products signed May. Investor X.X before Day X do I Green be about numbers Air from the PPAs, our X PPAs These our which X not good to new this of will we that Texas, year's in year. both signed likelihood phase

globally renewable be number energy one corporate customers. to the continue to seller We of

position a part explosive are a generative in of We in leading revolution. the AI centers, renewable result to growth the energy data seeing which U.S., also had providing as

Turning to Slide X.

area Another other customers with technology to been complete recent by success of is initiated working how developers. have projects we

strength great a a of these Two project Wind projects restructure solutions. on gigawatt, with we Our want Both a demonstrate examples Mississippi have customers. signed of we PPAs on can company the corporate Belfield our X also take of Amazon them repeat which this relationships project gigawatt know us XXX-megawatt deliver large and a which will PPA California, of X are customers. original provide the is PPA in signed with has that with recent projects the to these the technology because time in has Delta the customers they to and customized

for future especially projects. developers' we other completing current us, returns similar get projects attractive while can preserving our For because to projects is greenfield pipeline

when PJM, development business. replaced having on new to like constraints which decide land, resources transmission markets investments utilize represents once Our utilized, these XX and us renewables interconnection our to maximize in pipeline from total returns growing in and given California be must the helps flexibility gigawatt

already an and have currently, online tenure Moving within on our of to only have is of reiterate XX.X that a long-term obligation take the energy slated years, XX% and backlog our definition is once backlog contracts a signed to backlog given X and The amount largest more which Slide given gigawatts, XX% have in contracts like renewable our with of a which XX.X time. of history. signed projects of in backlog contracts X. to now includes average the XX we would to amount deliver under an AES' is We our for customers I construction, to obligation for next is years. the come of of

energy Turning landmark of projects. Investor in of of Phase community Act. completed of wind the state. have tax announced Reduction is Inflation in in X. XXX Phase under number the bonus Chevelon our in the for in Since and Day the In Butte be one largest the we qualify XXX-megawatt a X country project operation will And the to is the Slide to Arizona. credit we the projects commercial additional be service placed project X completed, XX% it Wind It the reach June, to May, once megawatts first

XXX-megawatt use copper plus of In battery it make XB all prefabricated future and in the learning addition, of of America. to mining were lowers the solar-plus panels also completed Xb solar advances able portion storage will of customers. we We in storage installation megawatts Chile the developments. Andes It's hours project, the cost our of for Latin largest storage project the for which XXX solar a

Turning to Slide X.

capacity no of ensure X.X we including new XXX online. In delays. year, already we've to brought watts the complete this megawatts on our have we double that nearly installed expect the very X.X to U.S., roughly the we construction year. teams I is commission roughly committed chain are which of We track proud we work or had projects last gigawatts supply have done renewable earlier am to to the

has to an this necessary up of megawatts for for XXX given the in XXXX the U.S. of our the equipment construction additional the performance of through program. potential been There year XXXX completion our strong remains contracted All backlog.

key completing record on time that projects of by our highly We valued competitive customers. is as a see our advantage

We developers chain meaningfully the Furthermore, years agreements, contractual are rising have interest our construction over of supply on delay last despite maintained only abandon margins due projects pressures to and major not to X rates. inflationary our or strong that due the issues. planning one and did long-term emphasis we project

plan growth moving contribution grow AES, through at the end Now of to X. X XX% our utility new our which on to by remain XXXX. security We rate U.S. August, or ESP annualized At to on priority XX% pretax second new expect at distribution our we into of rates Ohio, our receive Slide track go approval to commission effect. of for immediate electric point would an

equity. reminder, a includes X X on XX% most next while a Ohio. the return us the investments years, of timely in competitive will As improve to of recovery approval rates quality of ESP over to the accelerate to maintaining carrying modernization allow million $XXX grid This service in continue

upgrades. recover the At in Indiana, last XXXX. as AES, new as proposed the we rate rate designed June, new investments are a rates The case case well improvements system impacts to since inflationary first filed reliability, resiliency and since case for in

will state. online rates our to after middle we of lowest XXX-megawatt approval This for carbon come the we the build advance be hour by to We in the We among the project to AES plan. increase, at at XXX-megawatt expected storage generation expect continue proposed it plant. Midwest. or At the Even Petersburg coal of battery next is of our facility approval year, be end project site by still a storage to next the point growth largest retiring recently year. which commission in the Indiana, the residential filed low this expect

objective significantly Day by third our X XXXX. Now we we shut generation in the of Unit transforming our Slide of an assuring additional XXX Indiana. In our AES Petersburg have megawatts plant coal exiting portfolio retired megawatts down the coal turning priority our of XXX as by of decarbonization June, to XX retirement generation. May, at Since we of and by the end of advanced coal Investor

also announced XXX-megawatt of the by Plant Norgener retirement in XXXX. Chile We the Air

at the in $XXX the Plant approval, final allowing PPA Run Warrior received XXX-megawatt we for million. of Additionally, for proceeds our Maryland termination of

Now to Slide turning XX.

We new example A development our and in the We across technologies of competitive artificial in of the important operations. leadership sector. expanded new use advantage. application another is embedded our our see generative have this AI including as intelligence,

AI million both through This our and year, revenue by expect cost more to we be than reductions enhance. already enabled EBITDA adjusted $XXX of

solar We across of as wind such our have forecasting identification management AI analytics operations panel and vegetation from to failures. production areas isolated to incorporated data

plan solar of our variety install use the projects continue install As panels. and pioneer to AI-based part modules, Through of also solar solar developing heaviest advance vision working the technology, program, program, of models. wide heat. computer range faster including to proprietary With and we extreme largest to this a wide we and a robotics including install we are maintain across of and conditions, significantly robotics this to

projects the months, scale it in coming validating of we the use this In megawatts solar move expect XXXX. tens and full will be for installation for technology of to to

advanced consolidating green we're with committed lead in hydrogen our Finally, projects offtakers.

contract. renewables, per announced and features with currently jointly of day XXX of is tons expected hydrogen inside take-or-pay project X.X a Products It XXXX. green are largest in gigawatts in online It hydrogen come developing matched U.S. Texas. hourly We the in XX-year Air the defense, to metric

Our than to per gigawatts tons is and of of day. X pipeline renewables hydrogen more advanced green hydrogen of metric equivalent projects XXX

call With to that, over Steve I CFO, turn like the to would Coughlin. our

I good and Today, and Andres, will parent XXXX you, quarter morning, Thank capital guidance. discuss second XXXX everyone. allocation our results,

financial fully share beginning results keeping achieve that full year to us quarter, on track second to Slide on the pleased guidance. quarter with line well XX. Turning our was to the our expectations, I'm in our for

to and Adjusted at Tax costs and primarily quarter versus was million this year, million the by select margins by renewables line online thermal our our but due with AES $XXX plan, U.S. at growth at attributes were year, last attributes of lower at partially earned renewables million Andes by $XXX businesses. second expectations. an with our EBITDA coming accelerated offset availability SBU projects in flat renewables relatively higher $XX tax in new driven higher

was Adjusted last to $X.XX XX. $X.XX versus Turning Slide year. EPS

of to addition interest In higher the parent quarter. EBITDA, expense adjusted we this drivers saw

fully and earnings in outlined noted is come we the with the second we year-to-date year XX% the of in this a our EPS the that As of first earlier which roughly in that half breakdown year, XX% line in would reminder, our half.

I'll more over triple to priority performance continue our our the beginning Slide SBUs detail next to business SBU, strategic renewables by our XX. In portfolio units of X strategic on we the the slides, on in or cover execute XXXX.

higher by coming wind saw quarter, higher and we the offset For with new and accelerated growth partially tax due higher attributes projects generation primarily development by plan. our as business fixed second EBITDA expected, costs adjusted to driven online,

maintenance PTC At our utilities lower offset saw expense interest SBU, debt. adjusted higher driven we partially by expenses, but from higher new by

continue on pending this August are by in great the continuing utilities pending half AES, half increase We an second and our to pursue of XX% at With strong rate to for earnings the of X we the demand progress Indiana, typical the second year AES through growth and driven average seasonality to Ohio. decision XXXX. renewables base priority expect annually by decision strategic ESP at

thermal Lower adjusted margins of select infrastructure Andes by offset with units. coal, reflects partially in energy AES SBU, line availability out our lower higher phase primarily at EBITDA at our at

priority quarter, Investor strategic we we we not infrastructure to complete exit at third As Day declines annual -- see May. transformation execute the year-over-year expect as discussed portfolio, coal energy our generally every although in our to of in and

SBU, are year. straight this with adjusted technologies Fluence profit improved results continued reflects for they at strong Finally, quarters, shown energy and are higher new the very Fluence. has X margins we EBITDA improvement at our year-over-year pleased delivering

to XX. Slide Now

renewables businesses driven track are guidance our contributions billion. will U.S. in We new full at coming the adjusted to projects be $X.X year billion EBITDA range utilities growth including and from new achieve by year from online. XXXX primarily Growth $X.X contributions our to go of on to

recur last reminder, a to to portfolio renewables year this add represents amount approximately offset expect renewables primarily represents X.X As increase not of $XXX the year. of in XXXX. new This doubling we the will to over which growth this XX% X.X versus million our last be an year, we also we've the This we the quarter sales gigawatts of added third by in of recorded year. gigawatts a do expect compared LNG new to U.S.

EBITDA In in addition EBITDA, $X.X tax $XXX the plus adjusted tax total billion expect million to billion realize attributes of XXXX, to our year. our we for adjusted million bringing $X.X attributes to to $XXX to

Slide XX. Turning to

EPS also XXXX We year $X.XX. full $X.XX of to adjusted our reaffirming guidance range are

EPS our we project to our reminder, adjusted due heavily fourth the expect quarter a to U.S. of year As renewable be seasonality late weighted commissioning.

XXXX Now capital on Slide parent to plan XX. our allocation

total approximately million $XXX billion million reflect a billion of in discretionary we of debt cash sales free $X.X parent Sources and to $XXX million cash, of parent $X $XXX flow, QX. issuance including asset completed

at our please For issuances to our debt the appendix more information of subsidiaries, on refer the presentation. company parent the and

of with and On of take in right-hand recent invest capital. plan through all a appreciate allocation we Investor our would only to accretive the issuances as potential raise clarify of higher debt largely we acquisition pursue capital in X-gigawatt to We value moment Any you including for to equity Belfield that shareholders in received, we've XXXX, future future us our want our feedback Day way remains side, with accretive guidance, the At our and parent in equity planned value capital asset to equity source along a of the can potential our I a capital line have see project shareholders. use and outlined to to the will U.S. that's investment with May, sales, issuances. reflecting yield

improving We our credit and over further investment committed bolstering grade to our rating. are also time profile

number our and levers as growth pull capital sales We of asset a have to through recycling other increased such sell-downs. support to

it materially record than any equity shared. and the Given figure success, is lower strong future be X-year asset our sales previously could that issuances we possible track recent

additional Investor on additional As happy always, and to requests. feedback questions Relations our take team follow to is up data or

on growth make earnings free and summary, we're EBITDA, delivering In portfolio adjusted in parent strong continuing to progress flow. transforming AES' cash while

Our commitments. on delivering businesses are executing successfully their and

capital utilities high-growth continue value. renewables maximize shareholder We to and allocate towards will our our to

the turn call back I'll Andres. to that, With over

growth we're for through In our Steve. metrics XXXX. XXXX our annualized you, rates summary, reaffirming and guidance Thank all targeted

substantial including utilities base progress by U.S. end by We rate by continue than installed make per the through our strategic capacity renewables to while our transforming year exiting XXXX investing of and technologies. tripling our portfolio the coal and priorities, by on in XXXX, increasing XXXX, more our at XX% new

up on call delivering would we and the made our earnings call Day are that, I our questions. like We for at With to XXXX commitments on Investor QX open all presentation. the

ISI. question Durgesh [Operator Instructions] from We will take line your our is first proceed. open. Evercore Chopra Please with Durgesh,

PPAs higher is -- if in And heard now in whether correctly Can are I to driving down locked you're then because that than you X your that kind remarks you previous just range? have X Andres, you that's targeting gigawatts first. accurate might what higher of confirm what's years? new of

signed Sure, we last Durgesh. Good to new talk X.X gigawatts Look, year. to of PPAs you.

X.X this seeing year we signed. So already what have we're is

We And projects, X X.X, have X.X. be projects would about in visibility into the us just put another Which of which we have other would course, pipeline. right?

target, do official believe a feel we plus X for similar to a that very these have I'm last products. of because we should I be we see of out year. lot really saying setting call not the what gigawatt but whales, an targets, And we we're but good we demand our couple So that

We have to with people coming products. us

So allocate highest looking really best where best we our teams. allocate our and how we the it's returns do get money at

really on pushed the clarity when How could the thinking of XXXX, more. when just in we into call Is QX potential maybe terms we we get I'm then sort think megawatts of projects timing. that? would And yes. that event about that about should know XXX a

about program. that say feel would very I construction Look, our good we Sure.

construction Unfortunately, these versus this the year We the slated feel latter program of towards -- the the commissioned XXX%. be grow in of to about our by lot of big challenge good very this a U.S. it. year. was -- So to part are

So this of proud with good these do we construction really task, we with very -- and more our And up call stepped a them. I'm to to supply of projects in the have we're view pleased the QX the should whether general, going team The on of But has very chain, where we're teams. stand. year. in

thinking we that Where update color that nice And then to you can in an the just current get And when us when you we could an last be could are those just get timing? when materially Steve, mentioned Maybe me. needs scheduled equity equity on update? in just needs, hear you the to plan It's one your are more prepared give for hit? could one the remarks. just reduced.

seeing just we're great our and Yes. Day we Durgesh, asset the Look, said $X out of billion of program remarks, progress opportunities. lot that below function And put well in I the levers. a I universe total my sale is was Investor a mean, multiple of this on as at

to I tapped wanted could point only that recycling the program. be that our out shareholders, to going is what value other to issue and sources the we're to -- is accretive point we future, So that that future in which to intend we equity also asset it's the haven't far in tap, and

saw have So you as where upside the number. coal seen, with lot sale as in that run, renewable we of exit asset as you as executed sell-downs, we've we've we a assets, further on

it would the share be per on value it's indefinitely and to and accretive point, is would substantially price have today, share into future a our shareholders this than need at So it basis. to to be where higher

fund at to we've bringing make effective is Durgesh, partners guess been in that I to our I'd another point very like projects.

have. lever So that another that's obviously we

some our at project. invite point path. equity, out were always partners can a conservative But want that we into the don't issue we numbers. be possible future, in could what if we very to, So on laid we We feel the

part we're of Of giving well. as course, the them upside

is ahead. from go Please David, your Arcaro David Stanley. line from comes question Morgan open. next Our

just I your timing And here PTC was terms the kind guidance on around of and matching might additionality and in hydrogen thinking just wondering, what's be? treasury what the latest rules in stands current coordination currently? . with potential discussions what's like of that, partners it with just as the of side that on what your are your pipeline project -- and business

of course, is Texas our very Well, say would strictest -- rules project the really criteria. meet in that final What the our -- like would project out. I Felix haven't is come to

So regional. it It is is is hourly matched. additional. It

So it in carbon feasible the has the lowest technically very footprint U.S.

out not right there put is about the to how like way come I'd that that in out. rules project our any So dependent

that, do that important. have believe is also said to having hydrogen additionality believe in be early matching, I move need because to Now I green we projects tradable goods. to that we part

So Europe. I don't we in so important, these is add are the think further congestion. also rules regionality

we So market, also really, our but out what total lower that a create us new want the help is footprint. help rules carbon come they

So be just we balloon, grid taking energy green the hydrogen. the don't to renewable to squeezing want from produce off

more there. into get we And can specifics

I our expect But come factors. the out, So to these say that I do will projects of some very we'll are want solid. rules incorporate that

which have think developing. key I is for this hydrogen because off-takers, the We green market is committed

So is key the not project, great only and low with carbon think a have to a I footprint. have early-on projects, very -- it

all the IRA, of benefits you of have offtaker. to a So committed the get but

related to curious the to you then industry. the I could challenges And interconnection was transformation if renewable in speak just transmission

positions transmission foreseeable could How are now that. the to soon stage of You speak with that positions, of your regard but transmission you your And maybe kind current to of constraint in alluded things like it potentially your development, if business? land I early to future? impact and also in kind wondering what to a avoid you like positioned was commentary, pipeline could how

already. Well, market constraints look, I transmission affecting the think are

ago PJM for way out interconnections key we we years and a CAISO. started getting So markets got in like filing and X early, big on a

good there. So I in a think we're position

think right a we here. industry new I now, have

terms And interconnection new already make there projects to think to pipeline course, a rights, we then, real What so are So I we land rights, have, us, have with that phases. for is different prospects definitions. of come to project. And the either pipeline? is

of beginning are more shovel more advanced Q. at the some projects and are the Some far ready

from I -- that things bit would are other developers, have a call looked they definition, I think mean, move prospects. I pipeline a say, we the common reserves a at proven lot perhaps think like sector, invest count has towards having proposals little And of we is a reserves to -- pipeline, has probable I has get reserves, money. have -- to what's the oil right? you think have you which and very and possible And important to have to that

changes, it new will interconnections sort So on for bit just zone of little flood some a the costly spurious request for more the interconnections. the of example, make

development and to rate. in more conversion advanced you say, us most, can to I highest best can I very ask worlds quickly pipeline. comes we short-run it all Steve favorable client. that see any We on progressing, think maybe somebody bring it risk would which But what that that pipeline. don't get interested some about And stage investing at money comments maximizing a satisfy been of what doing to also give us. But of favorable us was the weren't emphasize in sort if want stage the to client and it. that's is on complete we I to long to So of the run, effect how be when we're the stringent conserve online would do us, because because project, we've We consider and the it's the is

coming pleased we've would out has been that, Andre although, quarter I of years. development just our look, to But said, And for -- add the we're strategy the lead rules many Yes. XXXX. mean, with final very to third renewables I as this

for important along more be ourselves move these these efficient. industry put an process Nonetheless, be getting it cues advantaged So years position, we to faster in think, I into for ago the overall the cues. many is in to

behind be the to them, thresholds by maturity to have into cluster important. to in project penalties demonstrate so and get to one deadlines and financing the also cue, the the financial do behind having and having studies higher that the having the then isn't stay one met cues studies having process. to in is review permits, terms So teeth And this just the that a of

being So will at this there's into later. go very think, approached order which published, the The XX is days order. effect through a to be number soon is and issue of due angles I

felt I about course, But faster think cues very the already for have position. I we'll great the We've important, decade. our it's of over term the cleaned great a throughout thing accelerate and rest moving longer the is and industry. to think of these further growth up

look, also improve And taking at how I can say, we're sort of technological a our we for projects. look transmission

baseload solar, is grid using the our were prefab half this to So lines, which This stack peakers. really to takes means like dynamic about able means be line using transmission which This rating. to to interconnections that noticed space battery loads also we plants. large good higher from decommissioned our the we're able interconnection. coal where projects putting And have a where have be we put you

to take a going looking So increasingly an position good of to think this grid. we're in holistically. at again, I we're what's problem very advantage And be congested rather

from from proceed. comes Richard your line JPMorgan. Our Richard, question next Please Sunderland open. is

back the maybe or commentary near-term just over scripts. Circling what relative any data were indications the center specifically? that demand change next from you're this months a years X ago? on to to C&I X a of of year seeing upside much X ramp in Curious how And from subsector you to seeing

but markets, and of the data say you interest data But would no, increasing seeing -- demand, definitely the yes. increased we're can there's some various mean, about they where definitions provider in rules for and centers. centers. largest U.S. to I are locate are we I that waiting

provide Brazil, so example, markets think another for abroad, And we same uniquely service, data with Mexico, advantage in which certain be centers us. for it quality I can Chile, the of is

increased we from that are yes, demand seeing sector. So

opportunities, And for a could the wanted there more conversation X.X Could focused And over then bit specifically, balance finally hydrogen. in to a about speak like hydrogen and few this those confidence backlog 'XX come the for years? of there? pipeline the little thinking then come year. in It Texas sounds just parse more just of on when what your you kind the gigawatts the could the to level for next little bit you're

hydrogen we're the I in again, green Well, real think of projects. most terms advanced

the U.S., that Texas. in committed for So project we offtakers in have

the We one our we're Angeles will of coming project this have the projects, wins would the Houston. in somewhat online range. for guidance could And -- the would in sign subsequent two one 'XX. outside including 'XX, that also year. we It hubs, say other further But XXXX several be be Los I first out, what we're are is is good And very use, basically, strong possible several also by we export green partner Chile, green electricity mining example, in a for we demand. projects, preferred in to seeing We've a And the people. ammonia have sector. equipment. which heavy of already as Northeast project seen Brazil. They're and

have it. in plants, things that. And substitute you that steel green you these question we like can online come petrochemicals hydrogen they we're really the in shorter because of projects use lot processes as off-takers. of to stay hit or will numbers. think equipment term, a with other again, So Certainly, confident can we the most in saying have thermal the tuned, but in I committed in a advanced feel quite It's

this develops. But So market us. have think positioned. exciting It's see well to again, we a I we're as opportunity very very for

the one been very in lot around around just messaging how came that then terms curious considerations just Belfield project, a I'm final me. for of And the The of to signing basis. Phase in do Anything one clear you've you would X X, return X? offer about stand-alone progress your How Phase think can X you just a Phase Phase be on thresholds there versus together. helpful.

X X. project similar to to I'm would willing is Phase on Phase a advanced what say. well we're think I be It

project So the that is in California. the largest U.S. solar plus storage in

very we that a offering together. it's unique bring can So

Angie, comes open. Please Our with ahead. next line from Angie is Storozynski go question your Seaport.

basically plans, that growth departures seen high-profile no renewables. how in success those Day, businesses your us own victims Analyst and but So I U.S. just might demand the especially that the the management from and of you since start can utilities core in reassure be your fill you wanted just businesses, there's sense, right, have to your some with we've in of to the vacancies? U.S. I you change X a these execution mean,

got for Angie, And question. of our I and Look, strength symptom that on. it in you is, spot quite case. think thanks frankly, this a

the hottest We in management have the market. team

And made is to private whatsoever. IPO, that right. they -- proof if a way business offers. going we've longer-term PPIs. departure to be no if bet of people people obviously so the in of on want are more But best to affects clean and after being this are course, that's our equity signed go energy, think their in And the And I

whatsoever. So to I we're U.S. any on it don't any impact continue have that, well. this I But have bench, we it a of doing a impact up. I and don't the business. team, yes, in And expect will same is we'll expect move and expect strong prepare have the it have deep talent to we very it a sign utilities. identify and

Again, let's something, wouldn't trying business, say, poach honest team say, wasn't where our AES people XXXX in the to in be it. the was or in,

executing think I our So plans doesn't it whatsoever. that where feel we out. very the about what on plans it very but is And good change I laid it and motivated teams on are is, we the are,

backlog And talked then about power projects. mean, you your I a lot moving on, renewable of

assets So of -- in equity. of world and then monetization potential the

where power for backlog some in the public they I we've backlog, have projects on First, heard third-party showing renewable don't basically stories these mean, developers So their projects. about exclusivity

any just you've So just I'm those instances again, for guys? of anecdotal wondering of this heard evidence, but if true is you be could and if this

some because such uncertain to can very are make other doing projects in terms, I maybe people absolutely, no we clear I say Well, no that. categorically, under backlog. our have want

that not an it whatever we of a our to recommend to certain are it. do time. certain on In I I are in for anybody case, backlog, clients -- think a certain committed take transparent. time, of for would energy we amount our have a -- that's and not we date have certain energy project, of amount obligation a delivering the the amount have to we

being of and currently our ordered 'XX we the XXXX. built, fact that about quarters of equipment is backlog, online So our through this 'XX will And for both them sides. X come have is XX% by the binding all backlog for

very question. something like that. recommend I can I never we So say, do to good a make to that. I would wouldn't want clear And that's do anybody categorically,

assets. then the on of monetization And

value So and is those assets higher I there recently you that the the on the of because very the so have the DCF cash it's PPAs, flip flows. developing, duration for big of right, understand But a transacted that flows. only between side, difference that you the the of cash of duration rates basically ones discount the are

your thinking demonstrate currently again, depends would So you have? from of were that, some assets, But value perspective, that I I'm monetize the just to of guess you is. again, how the if these where the stock it all portfolio

Steve. this Angie, is Yes,

we together been look, as renewable selling know, have, them package portfolio. come So have they've you we down projects in online after our and

what nothing low we the seen outside these They're we have some, no -- very terms low-risk fuel range uptick there, our costs, in this in of but essentially, maintenance. coupon, plan requirements solar relatively are expected of assets. very -- within return So say, is I would small

So these strong. demand continues predictable, are to very very these and for assets the be

we your down impact we don't sell plan today. are where see the the how to rates So in Does market that from for question? of sort any address

that -- quality offtake can or think thing other highest is are all have. you the -- I investment-grade very that off-takers the these quality I mean

product we So selling market. are premium in down the the

inflation, say it's have degradation look, writing a people interest So margins. our about rates, about to talked I not talked think that, have seeing we're important people of

our of squeeze not projects, into margin seeing the any we're So whatsoever. money these

with that on Yes. of community have site so the our project. project, adder there's been some wind And energy most financing all significant cost pointed -- new of as in projects the top out, for achieving to that that of actually, the we Andreas going domestic expect we -- just to for forward, Angie, the so adder too. offsets well, we've as qualify And

of Bank your open. Please question America. is next with Our line Julien from Julien, go ahead. comes Dumoulin-Smith

some to you lot -- comparisons the love if up of here I have the talk on let as Look, I your been details think a here, I'd the said know may. to year-over-year just back year, about already, I follow me on in here we has but half of you was last back I and that slides mean, renewables in of go half half year here, LNG. think I back in -- on $X.XX the positive if the year, net rewind it from the impact said LNG the here, of I from year comps year-over-year contribution $X.XX like

that, sort for what the of guidance? in a baking to to your need assumptions pretty half think big renewables about item in discrete the step-up Just about sort make as a you as -- you're of back talk like to of Can especially up in year what get I year-over-year seems that you renewables.

what And then about about for we the think of contributing, $X.XX full talked you talked about of renewable start if think year. in terms the I year, the I right,

-- please, and here well. respond start what's we I'm maybe what again, accordingly. by seems the actually than contributing at future years renewable is the for So as thought it that that implied what says of like means, year But more curious all

is So Steve, yes, this Julien.

actually it doesn't to offset. more doubling correct then, or we're -- year. delta sound be $X.XX So the the $X.XX And course, this more the like year-over-year renewable commissioning LNG of than is

year. you just is of and was most if this year, of X which gigawatts half all the X.X it's around it second year, recall, in the last gigawatt So

So been of half. sort cost what through first the flat first in renewables. relatively has in we're is of half more the The EBITDA carrying the

half the second renewable see to and the why of going year on that's XX% driver. number we're up second have the half, that That's we then earnings. a pick loading In substantially, major the

peaking demand is, and other The Ohio QX. Indiana in in utility course, of

have summer season melt the the where we hydro the and the snow of cooling the into quarter. You've in in we season America, typically, much got volumes third have the in Southland, fall. are winter And peak come wet then you have higher as out Latin and we the the

and of half volume of -- Latin assets much more America quarter. in So drivers energy those third about clean primary for $X.XX in really the the offset and in the the second LNG really some utilities then hydro the the having Southland, is only is mostly the the are the But year.

on there that -- forward. Is sorry, go a use

executing we're say year. just exactly the beginning we out the laid what at was of I

I to clear. that make been want no change. there's So

Yes, the is on I at Yes. Julian, this right -- we're XX% year-to-date. think EPS,

is retirements what seeing, have still expected. that's -- extend, there, that's the some lower, which we're in green of primarily come year-over-year margins coal quarter the Chile due So as coal to although was this in down, the blended the is all we've the done

as to potential. potential is Andres being remains about we on we're feel there and on also, good point, the megawatts your on noted, really the track. some upside So XXX with exactly program still upside, And construction track there the

the renewables is for point the from year unchanged contribution still. 'XX the of start But $X.XX the of in plan

Yes.

because you but have least Let is us would front at math on the me, track, is on renewables exact back what to looking in of say. number that get don't I contribution I the

can I direction different trying up on here, give If few questions. earlier to follow a a slight

that new think say in sounds just the so. equity, terms alluding you lever sell interest Just on could even be monetized the more seeing the like versus fair the to about level equity. else would you lever about you here out what you're just is what further that down else principal asset a sale dynamics as little Or of to Is like Andres, equity? can versus comment alternative were bit renewables in you corporate there? your the It deemphasizing

just levels that defined you point you earlier. the equity you levels precisely, -- you definitively lieu would these of made on to just -- the also very today, in away And equity-ish levels clarify move at these from earlier alternatives?

not first the on fair. not point, fair. no, it's Characterization So is

look, have businesses. partnerships of right, we -- all what So in our all

So on we necessarily have don't new to it projects. do the

partners -- to bring we in can So money is fungible.

have available means money renewables. that business, different a monetize for we more we if So

to the -- can think invested we good coal. we're have in we And exit We of return choose on optimize doing job very will a capital. we past, I the as how that

I think better probably monetization, I is think the Warrior than Run expectations. people's

we manage so continue And that. to

had X-year of saying number, and his amount this a we a script, asset So we Steve never X-year we plan, had didn't plan. for -- a sales, as of well. that we we is out as as sort all potential put issuance a the And -- certain I'm -- conservative equity in in range said

So the offset somewhat X other. each

So less bringing we on better better and in do in we do asset terms will need we equity if partnerships. sales, of the

what not levels, very is that it's we're have think And at what doing. our issuing comfortable that So been opportunity. for we feel market clear equity. from these demand we're a do saying I we presentation But once-in-a-lifetime tremendous

most want shareholders value the to So our create from opportunity. we that for

use we feel we correctly what other to should So have we'll equity, obviously, this to have guys. if new valued don't And -- nothing levers. you is be

in remarkable by assets. a equity. change without financed issuing it have company partners. We We We by got did this selling into down in wind bringing

It's So is like future. a saying we're nothing same. more promise what the for of the just

continue do So the whatever shareholders, value for will we use will levers so. and we most the to creates our

equity was to a process in this clarify issuing at ultimately in know of well. variety the as committing still listed it partners is the can queue not levels. So per I a quo your that here that incrementally not just selling here also sources different down se, Is way? underway. point if current And I status

process specific Julien, point. -- No, at Maritza underway, there's there's no this no

for Maritza. pathways different evaluating still So

from comes open. go question now from your Ryan, line next Citi. Our is Ryan ahead. Levine Please

And market to considering help of couple issuance? portfolio? A to Is still guess follow-on equity your secondly, the specific the your financing I convert questions. you core on are Fluence offset take side, to open

So this is Steve.

So in of do, to include EBITDA. come adjusted we in but through adjustment portfolio roughly Fluence EBITDA not our is definition part an Fluence. Fluence does is method. equity And we consolidated, yes, the X/X, It of include own XX% it

new up it's show technologies does energy that So SBU in our margin... influence and

that is question core, that is The core?

Or you say Is to did business? it -- is core? it core our

Core.

I parse as that in be -- done would an a outside a core so done innovative to We've It's make I this storage, to that. I development or as of like important able So strategy co-innovation, really the energy work. those of as gets energy mean, lot around to that it's out lead us as in say given co-development both XX/X I to as think well the used for we've advancing sort in solutions been would with technology Fluence look, don't business, storage products create well like carbon-free way the noncore.

to So strategy would our to with what been say, storage. do able we've that's, core I definitely is

But as these They're separated. said are of own times, their Andres many technology businesses right.

been grow lot of there's but pleased indefinitely, very of monetize continue a We solutions No part upside. value the work team and around. lot them to with new We're may recognized, And partnership already down a still of opportunities. to we are and new time that's soon, we look new to that in lot and we management our road. value positions a we as has see continue we do on we driven upside not how of the see

that So it is core laid from that I perspective out.

Okay. And the then on convert option?

I So look, this convert point. second we debt the $XXX no no, did -- a nothing mean, quarter. point. this in deal we're contemplating contemplated at just specific that at Nothing for million us

question. then last And

assets existing future In terms development of Puerto Rico, strategy and your there from what's perspective?

island's the greening Puerto in Well, we're Rico, grid. energy

bringing batteries renewal phase projects do in So our well. we as to XXXX. plan by have we're out coal it's And

what I its we've the our And are. we're think very and objectives been island transition. clear energy So assisting

comes from is Gregg, Orrill Please open. UBS. question from now go ahead. Gregg final your Our line

other On differences how proceeding any or Yes. the what 'XX Ohio, rate how timing guidance? assuming with case, DPO is were does versus the that Probably AES guidance that's compare quick. with you in

on right with Yes. in our track guidance. assumed what it's Gregg, we

that agenda has So decision yesterday. X, next believe, week, I just the put been August for on was the published,

of So assume out. about right feel made. decision terms to And to on really come we good when likely track that where is still the be in we

As effect investments out, start a to quarterly place. into be into year recovery laid effect. immediately decision new in the once the that decided put go to distribution put And in frequent then place, as go made, we've and last were is the then would would upon rates forward, reminder, the going our riders on is

room we've this growth to to And structure. new phase for to more for expect growth, an state point foreseeable is state to And for so future. lot really rates, normalized lowest in customer very we growth to there's as the a and from for pivot base where And really pivot is XX%-plus business up of delevering This different and pivoting as business the a even rates X, been that rate important going the Ohio expected setting a noted, there classes. we ESP forward. a in with the be the all it Andres the rates in continue lowest the there's have,

this the we're look excited to So week. very forward about and decision next

Yes. incoming investment. And is Dayton getting I'm also very excited about finally that

have a battery a have you plant So service plant Honda new into to EV coming area. our

been So the starting that expansion of Ohio. recovery. see participating to sort we Dayton you're an in not had Eastern had economic seen in

happy we're and service So improve it's and very to exciting quality that time, could and attract of continue very investments area. Dayton the we a continue invest the to new into

recovery for story, in not Dayton only first base story in rate an I there's So happening decades. time economic a think the it's

in to Dayton. a be time exciting it's very So

I back hand will Harcourt remarks. to now any closing Susan for

today's thank We us joining on call. for everybody

be questions always, follow-up any you a have. IR will As to Thank nice and team you, answer available have day. may the

today's conference concludes joining. for everybody. much Thank very This you for

lines. disconnect of great now Have a may your day. You your rest