CWEN - Earnings call transcript Q3 2021

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Operator

Good day, and thank you for standing by. Welcome to the Clearway Energy, Inc.

Third Quarter 2021 Earnings Call. [Operator Instructions]. I would like to turn the call over to your speaker today, Chris Sotos, President and Chief Executive Officer of Clearway Energy, Inc.

Christopher Sotos

morning. Good first taking to join time you call. today's thank want the for to I

morning Marsh, President is Plotkin, this portion will me Joining Akil the for Financial Clearway Group. Q&A and be of available our our Investor Officer; Craig CEO Cornelius, presentation. and of Energy Craig Chief Chad Relations;

this statements, may to like on assumptions based in materially. I'd begin, that be we the in are as quickly note safe results risk SEC today's our today's well we which believe date. discussion Please review Before presentation filings. to factors will differ as reasonable of contain Actual forward-looking harbor that the as

we measures. to refer and GAAP addition, non-GAAP financial In both

measures, regarding financial For our please to measures to non-GAAP the today's reconciliations presentation. comparable information and refer GAAP most directly

X. Page to Turning

for XXXX. its growing in after of Clearway CAFD end nonrecourse billion costs. our line agreed estimated in of quarter on other on will of upper an which X.X% current billion extraordinary compared business flexibility, value. assumption million, flexibility, the affords toward announce by allowing been footprint. Due level share dividend per an in with to of to our adding prior and XX% terms financial state For historic announcement a portfolio the net share I'm in value transaction PPAs target CX remaining the long-term our an us proceeds while these profile. in market for of to long-term dividend funding announced our baseline basis review more $XX and taxes our allocate shareholder million contribution the quarter $X.X unprecedented we share. has an asset of this maintaining execution we the also Thermal want commitments XX% approximately of also has per are generation Clearway proud of level approximately has the benefit thermal that with to the unlevered in years dividend growth later providing of the capital capitalization flexibility that to sensitivities, proceeds Energy, $XXX basis. of after represented a CAFD remaining with debt, expectation on strategic a million $X.XX of This stable in acquired capital, CAFD and fourth renewable our announced to Utah of current XXXX, $X.X very with to this XX% $X.X to company in presentation. average thank that for I'm safely previously have CAFD all of financial year-to-date Clearway annualized our last this Their pandemic. thermal pleased and of of transaction sell the interest in to in the establishing drive increasing drop-down years our face the behalf who replacing investments. for X-year thereby proceeds, while only annual past utilizing XX% million of Chad pleased X.X XX report has of $XXX of on $XX its results will for allowing allocated an an XX% growth a achieved basis, remaining billion approximately of fund be the teams guidance work remaining detail is immeasurable its transactions to time new the to company for of on difficult increase of goal in the results Clearway's $X.XX of during at financial for Clearway per continued This the I'm are operated XXXX. of

the return targets sake clear, capital of a underwriting simply for as this be license standards to take to not lower we at me size. and Let grow Clearway do or

Group We late-stage core this gigawatts funding in capital expand development Hand-in-hand a allocation, and with an with this will Clearway CAFD per development flexibility to projects XXXX. now dividend anticipated capital between X.X growth. including and on allocate of over sustainable driving continues focus share with its pipeline,

working with our Group been drop-down and becomes potential policy when finalize on investments, economics to have more We Clearway colleagues transparent. tax tend

XXXX. over quarter, the of our contracting addition, In the we assets beyond natural contracts position we significant have executed expiration at -- their executed further existing a California amount financial gas past on in have of the

of Specifically, of end for Creek's we Marsh XX% of CAFD approximately now through maintain adequacy net project-level Walnut Landing's and capacity terms that contracts have XXX% XXXX. qualifying the resource at

been you in those significant step maintaining is amount megawatts CAFD of time, a at share previously stability open of for following the to prices some Clearway significant the a For per who have years come. for of success on strong

our dividend of As corresponding I'm Thermal transaction, ability our of objective to in the the CAFD on I CAFD result thermal long-term our share of as is well to share in upper as the a pleased of flexibility that financial afforded $X.XX from excess perjured review support Clearway range this a unprecedented we through potential ratio the targets our now in target per the via will see X% sale growth to announce slides, XXXX. capital within when per X% couple our the to growth deployed. payout path to

Thermal transaction. Page X. the of overview to provides Turning This an

KKR basis. the discussed sell results Clearway the investments growth fund of yield, to in $XXX Clearway commitments, binding the any excess acquisition This Utah to remaining million to After variety agreement to proceeds As issue for of previously on very deployed XXXX. billion net capital with growth. equity expected of has Thermal adherence announced $X.X new $XXX transactions or of unlevered expected from $X.XX focused half underwriting with that conditions, CAFD of committed be allocating CEG of will remaining than transaction the and This accretive share resulting to capital a signed the to consideration, $X.X well resulting of has in with allocate existing in close more on Clearway million a value. have an Clearway to core a proceeds a proceeds. the with eliminate business first our net driving dividend These sustainable need to billion shareholder share per previously, in an implied market total the CAFD for and maximize served standards

to that the of As in obligations. of with a come to maintain maintain result depending of see activity our ability or our years, economics NOL additional X.X move will growth current some approximately excluding any strong $XXX inward deployment business have the runway that potential deployment investment X our tenor the new state tax the runway we lengthen we position, while NOL It's future. note to years of because anticipate impact this NOL to or important capital years through the assets. tax been on approximately and to our in of previous by of able we In million, transaction, the in

right from the balance at side the that renewables. page, of to platform Looking this the of comes transaction the us allows improve

result and of approximately our investments, EBITDA pro XX% to not committed XX%. the a for renewables in to contribution XX% our investment transaction, forma our from adjusted As increase from but XX% CAFD will unallocated capital,

allocation its for logic the part key to another Thermal Clearway portfolio as benefit growth sector. highly -- as X it Page of economic the transaction, $XXX Clearway's proceeds. on sale the story renewables ability Following on of company's the renewable the higher illustration to the growth more is growth of focuses the the a of provides an emphasize million of Thermal centered future,

and of of final from million transactions capital. These These sale. will the Thermal remaining been the the our account on for are proceeds have closing left side commitments $XXX into our repaid for under commitments our until to XXXX Turning by drop-down be of funded factored track into the revolver outlook page, transactions with year-end. growth

CAFD million equity will these million XXXX. Clearway On the or the with operating deployed. pro acquisition with we assumes of that are in column be leaving acquisition the showing page, Thermal guidance, a We'll XXXX. million on Clearway we XX allowing produced X.X% investment and this of X% volatility. CAFD to to from that a allocation to the thermal growth absolute at base ability with the have working a of Clearway Chad. majority unlevered forces colleagues to remain years an CAFD on significant dividend and degree focus see X% of issuing California to allocates of issue the returns Energy and for as deployed. replaces a drop-down proceeds portfolio in the we investments the to bridge well shares the of X CAFD to I'll our pro of we the million yield. we through operating deploy first gas share asset to has capital. $XXX transaction. a the If our assets CAFD capital financial CAFD flexibility reduced Clearway our of repaid quality operational have this these And million eliminate affords and of Starting and low to look for terms the history creates behind that be maintain PPAs yield, CAFD with of asset's growth. our of high requiring under right Thermal facility million closing our an targets our Clearway of updated since the upon CAFD the the that be target the approximately it's CAFD an allocation with are deployment allocation outlook acquisition underpin $XX only capital drives to confidence side as we're XX Group. attractive combined capital disciplined regained by on any performance, of additional transactions, the while of This driving close range Thermal $XXX own. owned at basis, asset employed dividend of sale to The of profitably provides avoidance over $XXX with This million has identify of as capital we ability its its with being the opportunity to one redeploying ability the that proceeds million allows proceeds. in the to our while path strong IRR forma XX% XX% Clearway be it our be emphasized per always This acquiring our capital sale in will that if The our Chad? asset-level the $X.XX remaining million sale need per that Page pro standards of not of to forma X% but company. growth that, $X.XX it recontracting of of the basis. that and north turn investors now Thermal upper XX% With $XXX our and update efficient and a a on CAFD assets, CAFD the CAFD contribution fund solar $XXX operational into $XXX of Utah drives investment versus the opportunities With be for that this yield million strong NPV already underwriting with outlook left and drive while synergies, ability allocating per share $X.XX unlevered an in to the with $XX Utah forma Utah through of having XX% of to and don't from operational current share $XX

Chad Plotkin

Slide Thank Chris. to turning you, And X.

$XXX available within results the of company's quarter, CAFD for million and of the $XXX is of continue distribution $XXX For sensitivity adjusted realized CAFD. of EBITDA adjusted million Clearway range, or Year-to-date to EBITDA and reporting million $XXX million. third now be having cash

For Conventional the of benefited third of higher quarter, performance from volumetric the excellent Thermal the segment and segment. company sales the

parts offset portfolio third by across of as the project-level Renewables quarter However, this as versus well which in fourth of in part occurred quarter. the was resource timing debt the service, the low

above California demonstrating XX%, availability was resources their the value reliability across the again, as For the gas natural assets Conventional in critical state. segment,

low. with segment, sales resource last period third Renewables volumetric year conditions recovery approximately higher the realize same increase in from exceptionally COVID-XX quarter the weather and through ongoing June to the the into to X.X% was versus observed where July continued favorable an business the wind challenging Thermal, due extended pandemic. For of At

However, produce the total and performance above-average combined the median August bringing September, wind expectations. XX% portfolio to during wind generation in quarter did around portfolio of

insulated solid was estimates. production overall irradiance through financial segment, as Alta first performance Solar That of and expectations was the solar has half strength the of on For also XX% said, year-to-date a most of year below basis, results. Wind at the the project

Lastly, nonrecourse payment a results of due relative to estimates to entity. the a were service timing impacted at debt

quarter, full so the will year offset to no change relative in this expectations. there is However, fourth

CAFD year-to-date continue to company's the overall factors, guidance $XXX we of so million. these maintain Given sensitivity in is ranges, CAFD

assume this the As full the first affected production guidance renewable impact in February the reminder, by a year does and the event for is PXX quarter winter million continue approximate in to Texas. due to also median $XX

Moving balance to the sheet.

During outstanding an XX green senior maturity now a outstanding has that the the XXXX. the effectively with in interest XXXX corporate successfully matures now quarter, new maturity the refinanced at of cost X.XX%. with cost third bond the of With refinancing, this its earliest company indentures, all the company extended the in notes

interim under the the existing financing close million facility transaction have for and need utilize to growth the new are equity capital cash funding company For whereby In formation, and the all temporary expected the sale proceeds of we through committed since we during regard, issuances, we the using the an available that transactions Thermal intends $XXX sale, will closes. Thermal to the Utah revolver, to from working facilities eliminating new period. currently fund bridge support now until

company's $XXX Slide discuss Now the outlook a million. we to pro update and to CAFD outlook XXXX long-term Today, to view pro forma CAFD our to expectations. forma the revised turning are of XX announcing

median As on operate gas Thermal assume estimates. growth the run captures this the further $XXX excess maturity, business, the is from the current exclude all recontracting. and within proceeds now This contribution success investments expected also California any rate thermal the figure average be given It the in does, million may post figure from exit from profiles assumes which noted mitigated the assets from realized that continues PXX contract however, of transaction. committed deployment to significantly slide, full growth of the production

also for further guidance. potential most CAFD we and While commitments, is the outlook pro establishing company's long-term forma today, growth to are its CAFD ability critical the meet 'XX

noted year provide on of the 'XX and of winter event results. financing $XXX the growth of the million. CAFD effect a a storm the reversal to guidance, summary impacting slide, of XXXX As guidance to the This we establishment bridge net of transaction current from explanation including realization, XXXX XXXX cost CAFD February Utah leads

current the on when an expected Thermal CAFD the please uncertainty Thermal guidance However, that due from factor note basis to sale will of close, business. year does the timing full in of million a XXXX $XX

But As update exit upon practice in provide forma the basis. on for been is business transactions, our $XXX with strategic already of accounted normal Thermal will closing of Thermal we CAFD the an expectations the noted, a sale. to million pro current the the as has year

of outlook. standards business. our we the for to capital the principles management run these cost for continue is where the the perspective long supports to strategic the turning to metrics the core CAFD adherence be over as balance This the Now effective company stand from summarize of to enterprise. relative to next critical a to grow most sheet pro forma Balance slide sheet long-term maintenance credit and our

corporate note will side targets, on corporate our the to at as Using today As trajectory in be maximizing EBITDA run. not and around will today, credit to we evaluate that are sheet favorable XX%. corporate versus capacity of we where where its the to is relative flexibility table, is in to growth to objectives, debt X.Xx, our also relative the meet long only pro outlook stand and its ratios and debt the but to is you the range ability balance forma as over Clearway's left it FFO maintaining relates we future, we

excess be debt, proceeds that given yet in Thermal the the sale Importantly, $XXX million the excludes impact to from allocated. net this has to

an expand of corporate run metric allocate be but to the As in on position to million, the our the to into excess of capital that the noted metrics better excess in improve. a also is rate, materialize in and as right X.Xx a of potential evidenced leverage can that the presentation by from will and This we to side CAFD only table, reduction XX%. we improvement $XXX deployment will FFO dividend consideration begin this to credit not debt our potential the put growth

the importantly growth further build to on Given will to company that, capacity these the the long-term remarks. even adhering turn I'll flexibility to of sheet strength while closing balance and Chris financing metrics, execute potential for maximize back its with And targets. call

Christopher Sotos

Chad. you, Thank

year our able also critical on accomplishments to commitment Page come. the short been how XX. maintain overstate this the to dividend toward to our end XXXX, been XXXX. Turning grow to the the deliver achieving our years high guidance term I goals cannot for only we've for our In of range at not have and in

we balance XXXX, XXXX of our benefited interest third-party in a issuance of profile. During sheet the and also XXXX for the the at from our of $XX maturity and of through green remaining extension M&A Storm of in Clearway with success the Mount optimize continued resulting has have returns. bonds to Clearway million and result through the Utah, XX% acquisitions in CAFD attractive savings

upper as and As shareholder on grow Thermal look to confidently of fleet, for a XXXX. privilege our to CAFD California of first able Operator, growth to in I've has please. path our lines you. questions to range in our the being open of continuing for through long-term target Thank share X% around We the achieve value creation. X% and of dividend support May per the time see a the growth forward goals CEO the of company gas becoming contracts result of our forward, visibility this to the XXXX, and transaction had Clearway extension our successful

Operator

[Operator Instructions].

from Pickering, is Holt. Bean first Tudor, with Our question Colton

Colton Bean

rate you if focused Marsh any? Creek, X counterparties time and longer-term were differently, lower Walnut the Landing to rate? of the in of Or the on split agreements a at that can interplay Or on tenor, just was some asked So characterize there frame? consideration X.X-year agreements at RA solely

Christopher Sotos

mean, ask I They you There's, of a outcomes. basically wide to bid. range

I provide up. a variety of think focused variety them frame, the tenors that's with time we X.X-year that where counterparties a but of bids on ended and were we

Colton Bean

of window Got what coverage through can the speak upper needing think time about dividend of to on well? aligning that then with at as in you the it. excluding guide now recontracting range, point guided end to do you just level now XXXX, And in the the XXXX

Christopher Sotos

differently. talked upper end rate the our that range the that between the your You of we've be XX% about may was and We dividend of phrase ratio, kind at XX% growth if think can achieved payout question.

Colton Bean

Okay. Yes, the growing well. that gas with sense. XXXX understand makes natural as you with trying to recontracting dividend how about really window through And think aligning now 'XX just the

Christopher Sotos

Yes.

proceeds I think that have and from that obviously, that amount our have view, from Thermal the contract the we because now to in that confidence it's through through a the of, a, confidence great been XXXX we visibility almost able gives us transaction b, XXXX.

your to we of California gas the our the XXXX. think it's significantly the in two reduced those better assets, contracting almost we've feel about I portfolio point, thereof through much risk that that So or now through lack volatility

Operator

Julien Our America. with of Bank next comes question from Dumoulin-Smith

Julien Dumoulin-Smith

on updates Kudos. done Well really. all these

or as this some we you feathered to? from here? you of kick guys should Thermal direction from that just acquisitions to mean talk I you mean, here well of be we any pace frankly, that third there mean I first Or should the the So things expect can just the in, pipeline I is if of organically. the the it course? accelerated the be perhaps raising either on want the to growing party just seems, normal sponsor As sort in that further obviously, watching is comment. if itself remainder like I can off sale. guys on thoughts are cash

further Now around that kudos up, any is California, on you've there monetization those Open contracted of again, assets? thought process question.

Christopher Sotos

Sure.

Julien. So questions a couple there, of different

it's us. I -- I we talk to to remaining I yield, we're deploy it's think well, emphasize think, at very cash, I about not though an what to do about -- affords accretion. tried it's think in about think the CAFD going call, This a deploy things the necessarily tried There right? simply isn't I to remain as not the opportunity to and on X.X% So and think also flexibility part going cash, cash importantly, because to say, for the example, as one, accretive. how was it isn't the as we CAFD disciplined IRR, We're simply NPV I'll

the And ultimately our kind of about so through in to there, from our the colleagues would third-party to of mind, 'XX. second work view, capital that M&A, half some of and keep kind talked going be continue to work we're development we in to around with allocate pipeline CEG at able that the transaction close of

not a if quarter probability -- that's clarity, -- in more really the second that probability. probable of probably more half the outcome. It's for is February? the than Just you much first said, terms fair what's of That's the

and an your opportunities well. and me, to May and if And that California the going have, with as capital think where that we're say, they let's what that recur the close might illustrative see So example when M&A drop-down question XXXX that gas to work sit include third-party return natural opportunities continue -- other are. as makes most shareholders, in around transaction To could actually of, CEG, kind monetization. on we sense we of also to to any see I to our

obviously I try for all us the runway. contract those This level, continue as on us, going to also pieces a I've good with indicated, really a look provides holistic the at at together. looking portfolio pretty we think to to of assets. We're kind

doesn't with willing we because you've further. mean, 'XX it through Just some as go that seen CCAs, contracts of the out to they're got

try basis these could some in to of we XXXX nothing on entities. contract with forward a there's So that says

Julien, the sale and in b, always open those monetization buys this time us of appropriate gas value, assets but assets I we're California to thereof. think, approach of any about our So definitely a, terms at on thinking is,

Julien Dumoulin-Smith

opportunities the you follow thinking How seems portfolio? opportunities with looks stand-alone within of to are like California, Got It be well just limited about as as the your up you. those pipeline kinds including if existing complement this in given some gas then of can just storage might here greenfield. real and quickly. constrained to resources be I those for assets And how

Christopher Sotos

point, as the future. part in your To that do look we of Sure. the have storage at drop-downs we

terms in of start natural installing existing think keep our installed platform mind, of in gas, in asset. and process at black Landing capability already I our black start we've the Marsh

So that assets. do for constantly it doesn't an space, so infinite have space have that black speak, sense site. storage just But of allocated. makes so of if start we evaluate amount Marsh we at gas Landing, has been at those But some at to natural already clarity,

Craig Cornelius

we're for add produce for will could perspective, and And contracted allow are I projects mandate like be we the contractual we're existing generally where see to other doing some developing that market structure those provide stand-alone also from where assets. design tenure that that with revenue so operating places Chris, to complementary in Inc. opportunity California. Julien, the assets, profiles reduction investment storage contracted renewable compatible risk Clearway has where they for plants Energy, hybridizing a or

resource intended trying stand-alone developing a selectively about we're and which to diversification. generation is assets and think once terms flow cash together be fleet as of low its both those So with risk whole storage as in so the built, customer We're developing the a of assets, portfolio, fit they paired storage whole. balanced we're in and that to

Julien Dumoulin-Smith

delay. your all? that agency that had clarification, with NEP, rating a Sorry, Is with out throw to on credit. peer, some updates I if and quick you one further just can, Sorry, why. there, Obviously, angle

Christopher Sotos

you don't take why that? Chad,

Chad Plotkin

think look core at metrics which forward Yes, I X I Julien, mean I know think, we what debt. I look kind FFO the metrics, to of EBITDA, corporate corporate between to an we referring. think our define look, you're as debt at I we

sense our I of and kind think think debt to, range. given the on that you're they in those where I the -- referring those is trajectory the collectively the I of exactly stand remain we platform. well doing, look strength I at number what of don't the I what I to have recall think credit have, And I within believe we we But of were the don't you in targets. but specifics FFO

Julien Dumoulin-Smith

Okay.

if curious again. was some there Congrats Just comparability.

Operator

Our with from next Goldman Lapides Michael Sachs. question comes

Michael Lapides

we've to plants come Pricing-wise, you're back in gas really -- different seen because RA $X kind range that a important investors think contracting little actually California obviously to I kilowatt I the today disclosing the bit. annually. to for $X announcements want to a pricing is month really, the seasonal It's of seasonally understand.

do renewable That's the one. using that Just X the debt upstreaming if When about about them, extends cash curious if to growth. that pricing that that out on type for recapitalizing assets, of get out the really parent of certainty the right? by of X meaning fully time X cash kind think incremental amortizes can X XXXX, you that far you reissuing debt, some frame, got of of to now 'XX-'XX you've years tenor out. question Question is, that

Christopher Sotos

Michael. Thanks,

So a couple of questions.

sit us, like. -- I I pricing are and we today. where we the CAFD think, for think be from one, obviously, confidential contracts But of in the would we where terms about think neutral importantly

I how so generally is you're pricing indicating I'd in think we the And line with say think about.

we'll it portfolio all raise if to sense, contracts of makes leave investments, we've our to be at when XXXX. lot the that optionality maybe new in any from we of re-levered that If and look capital about the around If have do to an else that in tried view, diminution today kind really CAFD that look of it then If them, refinancing CAFD, doesn't, lower as In excellent to Obviously, there's on mitigated. opportunities terms growth everything your approach we concerns we levered engage them. But so a are 'XX point. we'll would we kind take comes kind I to we'll would Obviously, unlevered case versus probably those assets kind book. of approach it. sense think makes there's there see constant. on question of the of recapitalizing, and together we whole as opportunities see want

Operator

Our with next Steve Wolfe question from Research. Fleishman comes

Steven Fleishman

a lot year things able your last -- The -- What's plant well, care Congrats. think California. as extend do contract Taking the the on on to this at sense once. of you'd be the just of contract? you

Christopher Sotos

continue I I that think you're out little Obviously, I -- work take XXXX, in expected as it's think I mean time. outcome. more is that probably more well. we'll think will summer the But our we there close year, bit on if think this a 'XX, versus of it. RA we procurement terms do asking, next that's Steve, to don't

Steven Fleishman

the guess, Craig a on energy for and could -- business? in company your then be terms have of development that I -- least thoughts And of just the credits overall, to the development clean at the -- Biden market question Okay. growth your curious there, your market for the for maybe impact

Craig Cornelius

are their hard would It's be growth that family robust how the through to a for Yes. of long-term renewables platform transformational overstate like bills working way ours. Congress

for geographies very built could scale allows So we in and do us accelerating us. are through at substantial it's midterm, at it of renewables When look at the allows scale. projects development meaningful where large investments been it to that that in hasn't into that historically built extend very make what be us to projects

accelerating. that see pipeline and disclosed around substantial growth, you we've which in so is And what our

Energy, more projects we're the of Inc., Some policy to investment the employ which would of Clearway of that something capital adapt also mandate to make certain the is even with excited us about. features we types compatible allow of structures

like see even idea us able tax investment tax have able for to projects not allows of as optimize typical of production wind And to more think existing repowering a qualified that assets with a for solar, to whether to deploy able be credit make more storage into be this fleet. about paired and also capital really qualified well. And be we eligible to example, so course, allows when for structure solar the assets driving resource the storage we'll fleet being solar project, credits, of capital. solar the around they're to For being us deployment or

in increase of extraordinarily what X platform to to this so have going years do during XX the combination for of size we're our and course next we years, and that when shareholder drives allow we is enacted, operating really legislation, next this what can dramatically about us. once our about us So way the X with and do the of business portfolio value, the a excited to development the

Steven Fleishman

of balance Great. keep gets lot scale-wise that all it particularly or that assume of the And that the stronger keep a the money directed up that down development this I -- down CX, such growth got kind up to of road, with most arm this it's that now would CX. and a years that sheet few of can and

Craig Cornelius

the CX that's have range metrics objective. structures as our makes of the think around into financing these potential that us of And shareholder the value I structure employ the allow PPA that and investments family Yes, also the important optimized drive projects have to IRR. that really to capital that addition of be CAFD Chris allocation in to cited for to and we

as growth work development in think goal, operating our we our an value our portfolio yes, So business. the of focused driving underpins certainly on really of fundamental that being that's

Operator

with comes next Oppenheimer. Our Kaye Noah question from

Noah Kaye

to just and first, one. sale out from revolver Thermal just the those or I you're facility clarifying bridge The working proceeds will the committed of quick investments? the expected a on, the cover scope guess full

Christopher Sotos

Chad. ahead, Go

Chad Plotkin

investments the it's current -- the those. Yes. No, Yes. up focused expectations. we're Yes. to Yes. on committed on That's

Noah Kaye

the steel and helpful. seen though, we little cetera. a well. Craig be then appreciate of may -- this super Maybe industry, you shorter obviously term, And have inflation as availability, policy for cost prices, That's comments a potential the the et labor just gave lot all impact. I bit across around

you're prior sort the and profile is IRRs the on expectations? trending IRR under timing. of as curious projects Just cadence How versus well for seeing development as what

Craig Cornelius

Yes.

them our the that the care the more such I discipline business scale manages our we relationship in that have Fortunately, approach our working with ways. nature us, prioritize likely think and principal we with also of our leadership our way than risk position with they outcomes suppliers some for favorable collaborative history of that and is and peers given our of and industry

like we're acute with us. the implementing working impacts more that point mitigate one is this than engaged congested, for may for So very partners with others us be capacity at projects a where to in whom are

planned factors, really XXXX are are, say, about there problem for for commissioning think we that when projects So principally I think, XXXX. through, inflationary a or

our pass that solid customers long customers inflation and value say, to to technology the we proposition cost markets. large about the the Beyond feel contract XX% improvements ability We in while PPA avoided for through in cost or industrial run, measure offset really on to wholesale below a the feel cost also load-serving have the participating prices revenue anticipate prices is by been, we that customers. that, we energies in favorable providing XX% average because commercial very offer being industry still inflation and to those for in way still

in will are on company investors through projects consistent we be and around signed And management business. that up already we for on needed the that on are enabled where the have industry flexibly for where years. produce that to revenue our favorable really run. about price and the we are we and as interval, ability is schedules partly a returns are the we XXXX. parent that solid as through expect delivery for work makes advantages us to by of also will investments plant What layouts is built projects the long returns are And working with contracts next projects I So that referenced to feel X and producing And we CWEN and move set risk equipment room they commissioned during it our how very expected the managing that inflation sequences. objectives that be our

Noah Kaye

the maybe helpful color. one. last just then very And That's

could additional You benefits then power for side clean the could side. the the had mentioned potential green which benefits as all benefit tax production the some And plan. some very even develop hydrogen dynamics. in to credits well, be on before. ability Biden compelling we production, make for the incentives An And haven't on taking -- hydrogen,

may little hydrogen production you So or developments bit partnerships with any a collaborations, about talk can you have as a entities? platform

Craig Cornelius

forthcoming hydrogen Yes. operating but think green We the propositions, advantages growing about and think end we'll in think we of and California market is regimes. see in infrastructures hydrogen of Texas. use incumbent advantages, an the of I bring those in consumption where bear we incentive Different grow decade. we different a to have also green course consumption fleet of where When and during delivery of that lot existing distinct distinct around like a both markets, places end users to

forthcoming a suppliers hydrogen renewable sources renewable And be and they value delivery equipment the during nicely of about are the pipeline can value-effective forthcoming as time hydrogen engaging could our of optimal for our locational green And West produce renewables consumers And we we with maximize our you sources green like of both to electric evolve generation the a also can development commodity. fundamental an the fit as prices with end hydrogen. around at assets course model thinking for hydrogen. imagine, of hydrogen. as so detaching those by resources how business that users decade what those of from production green value of the projects for has in we're of Also resources number do that the marginal

for it mean our strengths. our So about we what see mean a can lot what we're and about with excited broadly, decarbonization it excited industry existing for of we're complementarity could

Noah Kaye

strategic to the progress Congratulations team the on quarter. this meaningful

Operator

question from next William Our is Grippin with UBS.

William Grippin

capacity unique just might Is there make to that terms? positive cautious that left a the favorable or do more on you about was assets. the that First on gas remaining there you anything have California more contract question ability on the

Christopher Sotos

that's I'm it's El for Segundo, not combined sure if -- question. a cycle your

energy of overall bit X peakers. equation. little more So obviously, than component it's economic relevant is in the a The different terms the

in they that's fast cetera. say pocket, the XX-minute So are really start machines, load I'd a only difference. et The

the is the the are attributes The cycle. combined only difference same, assets. other those So given

William Grippin

Got to on is you I'm returns. returns. mentioned it. transaction, versus shareholder a waiting kind thought to process what sit on shareholder just the of respect to your decision curious making willingness possible And redeploy with Thermal cash, on possible

Christopher Sotos

to I the think, closed once yet. I'm again, transaction not hasn't get -- going

on So we're call, that I part really, the I think talked emphasizing really is about flexibility. as

years, in the question would is, If million $XXX to sit X closes, next is no binary well, no. it. it is probably a visibility sit for deployment we that in the have when on deploy X months answer If visibility your it on would from $XXX approach million we with we

with kind and a if other cash be we're sit third-party the if to then NPV, IRR all hoard. going We have on shareholders. return determine just talked and about are M&A, of together holistically for some the when and there take that's at think closes, a to at to from the we're our there, the looking residual probably sent transaction would not to look and that of assets but is growth going So prefer into us, that kind looking have has capital Craig opportunities put of at of aren't I of cash a currently to new all on CAFD and drop-downs it commensurate on developments requirements, combination to we call, that working

Operator

the further for any to don't back queue, remarks. Chris like any Sotos the final turn All sir. right. Instructions]. would see questions in I call I [Operator to

Christopher Sotos

this been And in joining. once Thank quarter. particular. Nothing a great again, you, I everyone, really, has for think

Take So company. care. I in appreciate the investment everyone's

Operator

we that, may disconnect. a participation, with for call. you you and Thank And end day. your Have wonderful our now

Clearway Energy (CWEN.A) 4 Nov 212021 Q3 Earnings call transcript