AES - Earnings call transcript Q1 2024

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Operator

Hello, and welcome to the AES Corporation Q1 2024 Financial Review Call. My name is Jordan, and I'll be coordinating your call today. [Operator Instructions]

I'm now going to hand over to Susan Harcourt, Vice President of Investor Relations. Susan, please go ahead.

Susan Pasley Harcourt

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

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

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

this morning Executive call members the that, me and Chief are Joining With President Andres turn senior and Officer; Financial over Gluski, to Chief of other our team. will our our Andres. management Steve Coughlin, I Officer;

Andres Ricardo Gluski Weilert

quarter review Good XXXX financial morning, thank our everyone, and call. you for first joining

so will and business provide on more discuss year. our very today, And are CFO, will key our results performance with outlook. pleased our our give We quarter Coughlin, far this first and detail financial Steve progress updates. I

X adjusted first with quarter Beginning on in adjusted strong had attributes $XXX expectations, was our million, with We results. Slide of with EBITDA line with that a tax EBITDA quarter first our demonstrate and on structural million $XXX interest resilience These our once and results EPS execute of ability high to of inflation. our again guidance $X.XX. and and rates plans adjusted our to

have for foreseeable rates I that well am we opportunity pleased technology data XXXX. for with renewable Today, through all growth the will to growth the guidance I discussing we as and XXXX market centers reaffirm success achieved our companies metrics significant be the see future. for as and

the storage with our X, the in Bellefield last solar-plus-storage biggest megawatts combined with and project signed to will of with happy additional Bellefield solar gigawatts the we including and contracted XXX storage. The a entire announce U.S. second Amazon, X. XX-year year, for making Slide quarter, to provide project, of X Turning we XXX which that of of solar an megawatts project, phase I'm Amazon it contract this

solar-plus-storage Bellefield play is project the AES delivering able AI important the day. a We which and demonstration renewables storage new the that project to energy. energy supply forecasting, for weather milestone a proprietary AES' ensures in includes see gigawatt is energy carbon-free the of The significant component, X role throughout

we utilities Turning to center this making technology Slide more customers. companies, of directly energy nearly This data gigawatts include not among megawatts largest X. centers. contracts to the With of serve have project, long-term than X now to XXX signed with AES data does contracts providers with

Microsoft, renewals. supporting are the have that energy, We but carbon-free to commitments not specifically Google, fully made additional Amazon procure and others just

onshoring significantly Slide to by power Turning this There manufacturing of growth, the with Across next wind mobility. to as storage. driven of forecasted data over such center load U.S., demand better electrification growth is particularly and combined no when energy is X. serve technology the to increase and solar, factors decade, suited than

to of when power renewables by other decade Furthermore, or are next that actually Slide year be or clearly a LCOE, any that They volatility. the acute. availability the unsubsidized cost basis. power better predictable of more over placed offer levelized a not are substantially most online to than using energy, renewables new fuel old, Even an lowest is price data come of of X. form shortages Turning impacted energy on likely any build is source than provide to

can is which, in as Nowhere Slide is are by this queue, the interconnection you dominated on X, than renewable projects. see clearer

end is and from wind. expected storage, from are is of installed the part solar, expected year. whose coming storage of Looking to energy at additions XXXX in as energy growth by of U.S. the an example, capacity major capacity the A come this to XX% double the

Given X of me the than the fills see economies with and role capacity from satisfaction country, that in great creating their grid-scale our dispatchable to it more now commercializing largest XX% get storage, batteries. first energy California lithium-ion-based in and Texas,

even energy largest storage when of We periods the the power day seeing of the in now source are California single grid. on is

positioned to Turning developers, AES is renewable Among X. Slide growth. address best corporate load to

We in bring cost-efficient to have the market most scale to and projects experience the way.

data just and us ability give our it customers, early to with partnerships innovate large to as Our a with advantage competitive center our led flexibility companies.

the management bringing in record the best on supply on of projects track and market had also chain We and budget. online, time

pipeline stage XX to Slide XX, with maturity have late prospects, including projects on not we ranging of in stage. see can gigawatts, you early a As from

emphasize me land pipeline control our filing. as degree include in of of all interconnection as Let some that well the projects

In of queue a the of addition, markets pipeline, interconnection in of this just and taken pursuing total best line rather terms our future provide into megawatts, competitive and The and a sites positioned those maturity significant we and growth. strategic see most have to building on where pipeline, us positions, value. both where we market approach advantage add than are we sight to and with meaningful breadth focusing demand

have return contract contracts EBITDA basis and As historical led our points to results, now gigawatts both XX% renewable of EPS. to X.X expectations on of gigawatts. by including we after-tax cash February, February, with signed our combined QX our levered in for accelerating projects, X, for new us of With to mentioned our U.S. XX% XXX increase and I our since demand a project signings a in backlog guidance XX.X Bellefield long-term raised call basis

Arizona, first Mississippi. wind new of state the added Chevelon operating of state utility-scale which Delta, the which is of largest almost also portfolio, and project We our have the is in project Butte, megawatts in including the completion the projects wind to XXX of

good we year. a to projects our construction, track fully gigawatts we With and under X.X these of new this capacity additions operating total on making progress to are our the currently fleet remain on add of

XXXX, including virtually solar projects site, on our equipment that of half of and note the than modules for more the XXXX. all for solar we in major should XX% modules I already coming our of online remaining had

one has chain continue will of and to be, Our resilient been, differentiators. diversified supply our and

utilities on Slide accumulated Indiana rate investments recover rate Regulatory its critical our us rate experience last by the provides case on customer of achieved to a in with constructive since focused Indiana a Commission. XXXX. AES case approval Resolving us the to foundation reliability, our case Utility our XX. mid-April, the In and inflation allows and Turning resiliency for partially regulatory milestone

case we strengthen the also and Indiana's customers acquisition value savings projects. of our of drive to on $XX demonstrating late X.X%, includes of for the support customers. providing an AS portfolio XXX-megawatt In closed overall Wind the February, project, system also adding million to The the that reliability rate renewable ROE investments Hoosier increase while commission's long-term for

X latest storage on our growth Plan, ESP solar and well in Resource place next plan, rate stemming as year over wind, Indiana's investment put the Ohio, QX FERC formula structure, new of to our and includes last At AES from of transmission. as case we X, IRP, a or in commitment Smart Integrated megawatts our continue execute in energy X,XXX AES the for of years. addition Grid program

rates of end AES maintain in program, classes. Ohio By all lowest customer the the the still state across the will

approved through planned AES of FERC XX% Ohio's already approximately reminder, a are XXXX investments under or formula As programs. rate

investing a investment rate last year resilience and improve and up experience. result of from our nearly utilities, QX Across was new the structures our as system to customer X XXX%

now ahead, XXXX. we our sight of utility of of $X $X.X a Looking through have capital line to billion clear program total billion

location growing fastest-growing from the from also planned throughout a the desirable opportunities for they the interest seeing are rate service upside our providers the center double-digit potential believe in further investment We base country. growth. horizon, our for we utility of With one who see territory as represent growth data

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

Stephen Coughlin

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

Following understand. that, will efficient a is I which to highly low-risk, deeper capital dive into our for provide important everyone structure,

with driven attributes contributions million roughly primarily Slide first ago. of million was megawatts online. the to brought by $XXX year in from tax renewables EBITDA This XX. Turning we a was quarter new the versus Adjusted XXX $XXX

is $X.XX in results Drivers we These include similar expectations, our tax but approximately adjusted rate. also and $X.XX a were Adjusted lower to this included took with to quarter attributes Slide growth. tax that was aligned expense significant higher benefits, a parent tax last adjusted our steps with transition better Turning consistent with $X.XX XX. of holding with structure of EBITDA EPS with were expectations. year our company versus those and to to associated more line U.S.-oriented U.S. the for quarter which interest

revised our likely may magnitude. further although In smaller the from we of recognize future, simpler a structure, benefits

credit for tax at next year, XX% adjusted the the units an the are which transfers, excluding rate showing SBUs we slides. cover simplicity. of I'll expect impact X our continue We XX% on level SBU for the business to or of strategic tax performance to full of the

U.S. partially mostly interest was driven from base. on fund was Beginning offset in Higher with contributions from resource as new partially higher tax borrowings investments Brazil. rate by expense at by well primarily PTC on in growth. our XX, adjusted to attributes but EBITDA renewable driven our higher was businesses weather in favorable SBU with SBU our was by by renewables the as Utilities offset This revenues future Panama new Slide lower and

at accelerated the higher LNG our our Relatively SBU and offset flat of This higher the energy from transaction by gas LNG monetization in of our the infrastructure Panama year Dominican businesses the Republic. EBITDA Run PPA and prior reflects at partially was primarily Warrior recognized sell-down plant. revenues margins and

reflects at at Technologies SBU improvement EBITDA New our higher margin Energy Finally, Fluence. continued

to Slide turning our XX. guidance Now on

guidance billion to adjusted reaffirming of billion $X.X EBITDA and EBITDA guidance are to tax attributes We adjusted XXXX $X.X $X.X XXXX with our $X billion. billion of

and We billion see from execution offset short-term sale target XXXX. renewables partially expect on $X.X utilities our dilution in our continued to businesses, strong continue asset through to by growth

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

with to Our a only with earnings versus We be half first cash in tax parent similar even by XXXX. nearly EBITDA year, earnings but and half the distribution earnings throughout also XX% more a of in rate drivers the impacted anticipate attributes lower and tax higher to will have will come interest. adjusted expected adjusted of

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

$X.X $X including $XXX of flow, debt reflect parent billion cash, billion to proceeds from discretionary of approximately $XXX million total billion of issuance. cash of sales and million $X free $X.X asset parent billion planned Sources to

any consistent investment-grade we a As parent a debt level limit credit issuance metrics. reminder, to with our

great continue our guidance long-term We toward period. for very $X.X will pleased asset sale future any with limit issuance eliminate program, and our be throughout which need progress may the equity to billion parent

right-hand of capital. side, On the our you use planned see can

previously announced the dividend We will return reflecting increase. to shareholders X% $XXX approximately million year, this

to We invest new renewables billion plan also XX% utilities. of towards will go to which and growth, approximately $X.X

One of our flexibility both our uses. in plan strengths and maintain capital we is the sources across

As rotate we we shareholder to have will years, value. the across many creates capital portfolio manner on opportunities continue that to in execute a for

on Next, sheet how I want we manage to Slide moment balance a XX. our take discuss to

nonrecourse subsidiaries. First, the relevant balance subsidiary on structural invest debt XX% equity This level. we it important of limits company Corp., debt AES is secured to meaning the our utilize sheet risk growth. parent to component the to is at our the only our nonrecourse in our we fund Approximately at

insulate XX% our with long-term fixed nearly debt rate our movements being hedged. rate further or from We interest financials of

nonrecourse construction facilities, yet debt or designated $X our are is generate the which of parent projects earnings to nearly on company that by the billion don't addition, balance In also but cash. under are backed sheet

a long-term to from repaid generated leading cash a monetization debt approximately be in of the attributes operations, lower operation. half leverage this will construction project commercial profile reaches projects on with When significantly of tax

As of a the result, only recourse is AES parent debt total leverage. to XX%

centered a Using typical cash, rapid in around years. U.S. project model, recycles quickly capital-efficient growth We've solar-plus-battery Slide example which an XX. recent achieved we've a enabling on the of strategy our

equity a place transfers. capital we tax project down partnerships service, in credit with cost of XX% least tax First, project's when and at a we pay

our attractive requirements. upfront We investment Our additional benefit parent fixed-rate, return the nonrecourse cash approximately which fund which is on from an investment rated. cash debt, amortizing net and projects credit, an significantly XX% reduces using investment-grade tax provides typically

renewables changes $X have We business. from hedges of we our returns on project expected most this insulate U.S. nearly of balance rate PPA. issuance to order sheet, relate when to we a which rates, pre-hedged debt interest billion outstanding currently sign in interest In our

a an With project. it development respect premium if into is in investment or Once for Alberta requirements of sell U.S. partner, the an parent recover not of equity upfront equity equity minority attractive the bundle typically contributes Investment AIMCo, all, Management, and to renewables, completed, we down operating large portfolio capital XX% a our at needs. project stake most, and

The minimis net high-quality, financial sheet. in result a an our listed investment-grade model little is invested in risks to rating not maintaining with rates. ownership end cash credit our grow to balance to renewables allows a us long-term interest material project are This sensitive rapidly results and de changes and ensures while

our quarter back tremendous significant all first start to to year, turning towards the We've a financial Now had progress of results. our targets. making

and expect continue our growing U.S. base as plan. in low-risk, structure projects a the funding new and utilities We remaining go while momentum of continue maintaining to the complete X year highly to gigawatts at the capital rate we efficient our

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

Andres Ricardo Gluski Weilert

you, Thank Steve.

the like first had sum line our with questions, of for I quarter. Before in the up quarter, we We the call open expectations. strong highlights would a up to

Our throughout our the renewable evenly U.S. now as earnings year and business cash balanced more matures. flow are

to results our demonstrates yet and again performance Our not our to interest are execute, rates. sensitive higher ability that financial

Our project financial as attributes equity finance partners. we and minority very debt for as model nonrecourse of as demand is project see strong tax well ample proving supply from resilient

sales important an on guidance need asset even of through our component period. long-term representing program may track, issuing our which capital-efficient equity growth addition, our In for is eliminate corporate model, our

reach several much valuation years be parent to have equity the considered future. would would stock before in Our new higher even

of have we equipment in growth pleased see leading for for We're major the our need of demand also our and with on in of as program segment on and XXXX what all construction majority for the to accelerating need centers. renewables largest virtually We be and well markets data core and the position well. strong executing are XXXX a we site

are continues projects budget. delivering again are winners chain our our delivering new be transition. to In once supply uniquely on energy track placed renewable well guidance support and we best-in-class the strategic objectives of one time record Our and management on financial on to of the closing, of and

line questions. up for please open the Operator,

Operator

question Instructions] [Operator Barclays. Our Campanella comes first of from Nick

Nicholas Campanella

thanks So your Is And little expand you maybe issuance. eliminating a the programs. sale should I planned just we about on comments the something a that have hoping commentary could for magnitude on was that view a future asset get kind this asset of that through equity sales you into I'm penciled Or of statement of and just have more visibility into effort? sense of because year guys kind have XXXX? to is a what this do multiyear to you trying size year. on

Andres Ricardo Gluski Weilert

historically, asset for Yes. No, believe we've question. overachieved Look, always thanks targets. the sale I our

year, So last we about million. $XXX overachieved by

So some tailwinds. into we're year this with coming

good. don't sale we we any on But comment they're asset until So specific feel closed.

is, has approval. disclosed the What government been already and waiting just sold we are for have Vietnam asset example,

have but we're So that's say, that We -- sale done. government a is let's it's large just not quite closed, it's already, the sale the approval. final

So we it. good about feel

of the we've net over that about equity. new statement back tenure $X the also of We've our issuing worth the actually, last billion debt. bought been look very frugal So decade, shares, in is you general paid if we've

new stringent issuing we've transformation do So to able being been very equity. this about very, any

years always of depending goes that it we being without partnerships, period, So We've our to may how equity also the our and on later about do any and programs never and feel at current that it we the be asset this we've valuations. issuance. growth our in able talked mentioned do sales additional guidance would we

color you notion it So as our gives intent is. we I a I clear provides hope of can, but as that much what think

Nicholas Campanella

something the some is just these overall framework pretty of you've point? to early strategy? into that can that think. your large with of is if earlier week, the your you data I And And and guess That's well framework Microsoft opportunity hyperscalers. peers some deals fit what of just you wondering, with Or not established opportunity, I'm you an just focus do center this wider side doing as I'm is with how that the that then comment of have right. AES just about at All as -- announcing wondering a would with with kind kind yourself customer? that just helpful. And this a on

Andres Ricardo Gluski Weilert

identified things that I years Look, we ago. think some several

So shortage meetings in many we said I've first, a just calls, we -- the times eventually would our out, renewable increase that shortage looking in demand. as saw of or -- a projects given

was up. So somewhat basically going of we due had XXXX a catch but issues, in that to tariff to lag

that is we going was be number for frankly, to one. were more what supply seeing So demand, there renewables, quite than

sweet future as on -- with early very data working our spot we've them. companies centers our and of been and identified in we two, really, Number terms deals, technology

So we things centers. up energy hourly data coming with with like have carbon-free the innovated match

So we've gigawatts. already done X

So we're are that out projects done. ahead. actual have been These

I very meet with helping ways been certainly close coming various So for that say up have them them. we some have that would relationships And things their time. with discussing we of needs, us

our focus really what pipeline. several So this need. we meeting their again that started and pipeline on years about And is up thinking see things is needs, like real building they what ago, we would

finding about It's it's we talk expect say, the to signed the strict And about not backlog, sign. most something sites. contract. So we a I'd when

talk some discussions. pipeline, not some it's and degree in we're this control, of having it's It's about land We've the being actual area. prospecting When interconnection we in queue. had

our these ability well So we meet what clients' very needs feel very those I are. understanding and needs, about to good think

lot to a to satisfy and in going is not because zero-sum the be was really see And good don't of demand able week, international game. announced last it see this an deal is a deal, good. I by we're all there, that as just it's So there's ourselves. out What that the we

and having presence I value international to the value think their of shows being needs. of all, to markets second And be able an in diversified the it satisfy of

specific been you there's on focus clients. how lot satisfy do think I a the not So focus on the enough of those of technology, needs

what we've been focused But We've doing been years. that's us. X this quite nothing this is to So on. new frankly, almost

Thank you.

Operator

of Durgesh Evercore Chopra from comes ISI. question Next

Durgesh Chopra

to Just antidumping something maybe can some you're there potential tariffs? I how get talks thoughts positioned place? been just of were tariffs, if and your on There's take

Andres Ricardo Gluski Weilert

the great following concerned compensating the all frankly, antidumping say, about Look, for would tariffs, is which at the not question. Yes. Quite I'm AD/CVD, I reasons.

the we year. for before next for everything would to already have tariffs remainder place, of for this majority site could I on site And expect we First, year the much need come what pretty we need on XXXX. and any have of everything in

that's first the So thing.

So -- made expect domestically and to think domestic then about we solar -- have when modules. we content XXXX,

So single at thing about I'm record. our the that delay or in there look abandon important any I When about this. project. concerned quite uncertainty XXXX, U.S. tariffs significant not out solar think was didn't is coming frankly, And most the track we in

these So countervailing into whether duties it. monitor place, we'll come

much case is of the the I the effects the the whole duties to I level think can But because people a be think prior than the as important tariff on have smaller. thing significantly so sector will circumvention should PPAs. less that be find clarity

moving am always about specifically been any I this like and concerned about we've not ahead. AES, possibility But because concerned

strategic have of the So like the with we, of suppliers, is others, but eating. proof in the pudding course, relationships

all solar come next. this in modules place, these So have And we site before we'll for our have tariffs on year. everything for

Durgesh Chopra

or X regarding a on place year very you for see here And potential question or can Maybe can in XXXX, the that? Nick's sales? as past? rest that announcements small we I the is cadence follow of multiple the discuss buyer asset or you've multiple of asset Just into the then in a for large up of do clear, sale and That done just like think about Andres. small just deals maybe large deal, large -- large buyers you buyer maybe

Andres Ricardo Gluski Weilert

be But millions sales, dollars. sale Yes. example, others, for hundreds on of large Again, we the of this. these don't typically comment or something would like, Vietnam

over that we we We'll of specific what maximized we sell explained. time. So down ones, projects, we would smaller continue continue we've the -- when think do And of I that to could assets do say, these course, down, you renewable also add. value the selling our will as to Steve

getting be will sources of us these So financing. additional multiple

comment don't we very is again, clear. I deal the until think So it's But closed.

of starting. We this, have very we're doing a record track just and not good

wind our some have We in sails.

So very I feel it. good about

Stephen Coughlin

track just long add, as would I Durgesh, a said, And have Andres we Yes. record.

just about the value it's securing not best goal, the it's properly. in about So exiting also

to So we lot have of do a pathways that.

number. conservative our of We technology And the renewables, our combination exit, recycling. international our of have $X.X portfolio, businesses billion is of and a monetizing coal simplification some a our it's

So number of there's a ways.

us we're $XXX and when were said, so And of ensuring looking all of we we year. by the we luxury last and valuation. these And that ahead, in the the it get over on market value, allows that out million see appropriate as appropriate Andres transacting

great. So we feel

Durgesh Chopra

a the on pace to the yourself Indeed, as supply. guys. power the just just question renewable you do to happen? given And -- all concerned be I demand? the do mean, want mentioned in we center you quick you deployment are the I just projections, the able you renewable your position with but And provide the -- might industry. demand are ask which fast? the exceeding Andres, going could we I see you apologize, think too to data given -- all in demand leadership the about of But deployment, the at pace

Andres Ricardo Gluski Weilert

Let's see.

power, we're your fast They're that to what think how I about can projects very getting -- they're come talking is online. power. time seeing the renewable about concerned

energy, I data think the in powered is time cheapest will to renewables. are the center realize beginning that They demand to market that power. the be fastest and by going mostly this to they're be growth

like say, about, talk nuclear. There something was a lot of

recontracted the years one. new system, aren't online. of nuclear be carbon power, takes decreasing provide So it additional. while bring And aren't they They to total plants nuclear number the can and existing footprint

am years, time the to a like, also I'm believer power going I key And play power them? role. So while on centers where X it's and how we'll data nuclear in okay, that's next nine to really in run, a the bringing long

think going supply in who projects. I position, people think? I do the be what those have best who have advanced pipelines and to the chain Now are have the

And of, And if the people you think in is coming I from to say, very going say, next serving how projects zero I pipelines pipelines the just and cost think are XX that years. gigawatts to in would other are and to U.S., that thing them were valuing are those create valuable, just aren't beyond projects And a the next I you? be Those I extremely X about much pipeline don't for in find that pipelines interesting X think would X enough. certainly within the that.

the I that, on is think to them interconnection. for able pipelines of centers, answer be there's bring lot who those a a there So in of flexibility. data time to and developers will state, The will I the think it lot will your question, question in be require

has center would Durgesh. What So of have that. Thank we that in But certainly part seen, I saw I and has huge you, being demand say, view last And changed. corporate year, data hope coming, data this is center is your not that answers we accelerated. growth, the question. a

Operator

Richard Our next JPMorgan. Sunderland question of comes from

Richard Sunderland

picking pace. if bit more little you from could Maybe constraints last and I'm that's this how by being curious on accelerating that transmission speak a Durgesh. question to up impacted

transmission? value And through of there? to commercial the how value realize you're there interesting from ways side. is Curious more pipeline an perspective, unlocking for side that an again utility the positioned on on obviously even interconnection perspective, and both You maybe the have

Andres Ricardo Gluski Weilert

time. that's Sure. we've also working for something Look, been some on again,

would So as possible. our in states, been a in I most specific allowed use line us to about can otherwise project battery think place the Indianapolis XXX-megawatt talk the rating. of hour here is not I project And dynamic that have this

So the dynamic for like rating, are possible usually is into lines always very rated simply, of it conditions, transmission thankfully, account which, monitors because capacity don't at the exist. actually transmission a takes line worst is state actual lines

existing actually, lines batteries we is the been on energy where for transmit utilized transmission capacity. the which Germany, use they're again, And Fluence example, those of with you transmission look, grid Next of line doing, underutilized. booster, banks when times in XX% has is typical to have

a lot So you there. have capacity of excess

using those a batteries of way definitely, them on hours. So is off-peak

there billions decades look, but no one and of avoid costs permitting. is in bullet, Now this can silver

have a And in in massive There And done. where are so to States. they project that do not that's to the places we this Germany unique Germany. get could

being So dispatch? We're question Who more gets And that here. do to saying a really, is And you remunerate is issue. it's batteries? issue not is technical isn't dispatch? solid the why the determines discussed? who this very The I'm the a own how ground, what

can of -- some more. money the look, actually And business models you make more to invest

So avoiding in big cost wants. way. everybody Chile. is not a looking But we're that one is Again, necessarily what at project

would on. be sites put for more a applicable been have that I working where is again, interconnections easy that X, the It's getting could So Other we in same again something day that to people that, states. also be in think frankly, that really data regulatory region issue. things centers you have quite from is,

be that have look, then AutoGrid, will today. in So are those also for mentioning Uplight, power Uplight, of merged really those are which resources. there's I'm technically But the energy we -- There all others, virtual investment the grid ones just are scale plants our and without known the ways. but orchestration

So are ways. other those

transmission. we about, AI things a predicting make talked understanding, better question software advanced out of help also system what All existing those wind bidding things more our next-day It's engines. proprietary use like, and of for better

consumers. transmission one only We'll also the about it, to bottlenecks. I identified will but that energy be correctly So not the creative be have of you the think the suppliers of

Richard Sunderland

for an and color, some Hydrogen, overall, gears. been of very year. the No, all your appreciate Maybe I of that's helpful updates in switching featured context you, focus heavily last that. active area

be terms Just now, focused on in hydrogen front watching of you're what curious balance of the what the get a over on we that year. the check should updates to temp front, on

Andres Ricardo Gluski Weilert

as Yes. But to project the in which That on largest hydrogen different Look, big with is qualifies what intensity seller green get Products, venture the of credits we have the degree the a terms in is is progress. regulations treasury waiting we're hydrogen, final world. tax of what factors. you the carbon in of continues still the joint for Texas, the and what Air

to comes once and U.S. is, the continue in hydrogen we frankly, that that the project quite a green make we So real with progress, advanced about it. most out, feel offtaker. Thank you, And Rich. good also

Operator

from Next Morgan Arcaro comes of Stanley. David question

David Arcaro

that smaller It terms last near quarter had this trends a looks I of in origination was term speak renewables the you you're if you origination. in addition to than like and renewables seeing could few. a wondering maybe terms of of bit the in describe

Stephen Coughlin

yes. quarter. you're had not at, I'm we Yes, actually a the good data very sure quite but looking

think was signed X.X the I quarter, David. gigawatts it in

very, very pleased. that last which second with Bellefield we And is really also our as to customer, of total we're Amazon, year phase. X from announce including pleased able phase So first the the Amazon gigawatts very a and were then

a that's And large the of been data very example so things doing scale. we've on an centers with

year, So we've mentioned. done in quarter. also the We've a throughout in only I and signing, our lot spreading execution in as the but executing active first been not

signings no, had be the demand year quarter. more is we many stronger ever. such, we as And target. much more good So this balanced. our will But than in megawatts about feel our really installed for The earnings

Andres And that we've was this folks what first. I come Microsoft, the just agreement. is XX-gigawatt one of saying where these announced that earlier as deal week is renewables a with think And the it's said, example been

with like signed or been like a nuke that. that's anything dwarfs it things so And

continuing So there this not come. a is more demand -- to also game, much is zero-sum Andres said, and but here and as

where And really it's maturity positions and in we our the so its pipeline of it and queues. good about and the feel located

about feel our still headed the rest really of good think has year. we're been I where for and the no, excellent progress So signing

David Arcaro

we to deals, aggressive, And agreement was we should are of seeing this in and into where that kind to going your saw Okay. you earlier companies of data you level be? getting out potentially out pipeline? signed contract I yes, multiyear Or could looking where center further the start decade further Great. back go demand deals to week. bigger to more potentially willing see getting same wondering, framework I that are that was

Andres Ricardo Gluski Weilert

a I of of I negotiating been hyperscalers. deals several And say, would the sort that's we've what agreement. think framework think doing I is with and, big Well,

just not So we're one. focused on slowly

And preferences quite so they're going. frankly, they And demands. looking solve how slightly different to have at where we're their

have Microsoft data Chile, with for We in center deals example.

U.S., very people provide, biggest, footprint. your is fastest and for But think that's have the of who looking I they're there are opportunities, course, where can you depends what growth. the it international So interesting

the Asia have quite So about frankly, markets. And believe they capabilities. talking not Brookfield, to deal those and we I in more have be that decided European in we're

Stephen Coughlin

Thanks, David.

Operator

from question Angie next of Our Seaport. comes Storozynski

Agnieszka Storozynski

about $X.X the of right, it's math, about it market if but flow I'm cash free cash with just up just to talked it to past, using say, the And investments enough? just how accept the really Isn't simply that seemingly maybe free to from amount contribution the this that again on you So of I -- is, $XXX and, return. to on Analyst trying the the from million All Or using or competitive I it it just you how from return cash it? spend of even that's would it, enough have and that's guys were is mean, I of up is you Day, terms? back time renewables flow end free the to those and amount this generating CapEx that little to and back wanted it I'm with that -- costs like get doesn't in billion the just of we seem these an is say this, money and require. accretion wondering are expectations? your EBITDA financing the EBITDA and to your planning to go much equity would how of know flow renewables of target it going develop that renewables you like

Andres Ricardo Gluski Weilert

given in more Yes. I But what is a where can we thinking right? don't say, stock, upfront model, offline. not But -- attributes first I would the different, in We do go the it, any detail say, -- think states, I disagree. U.S. you only lot a have we I of Chile, are tax in you maybe that all, to realize the our of renewables it's do better the mean, of it's in of flow have returns but the way would into the attributes. renewables example, there. for tax sort let's a actually, of

get is also example of of partners down use immediately you amount pay gave, cash get that going to tax with the And to project a And then cash you debt. selling forward. who construction attributes in a -- debt the want then by bond. you So So a with lot we like right? cash, minority solar down the you're lower left a

returns. to willing lower they're take So

on So have XX% total project. back do project of Because after a you very the commission for right and the getting returns again, cash almost good you it. you're cost the itself,

at looking you're that growing when EBITDA numbers, very the fast. realize we're Now

So year, grew projects of our commissioning last XXX%.

coming over So are online those projects now time.

our market I increase. let's efficiency. will So internationally. in of targeted would and say, even And tax seeing did returns because remind mean, without don't the again, and no, I for we're attributes, think think maturity getting I -- We returns what the I U.S. increased, better you returns increase we're that, our

internationally. another talk the costing what when the Xx in they solar And realize cost renewables, it, comment panels X people that to are on competitiveness about states of

megawatt cost of the the much most with storage and it energy energy cheapest places much, So cheaper, operate. renewables certainly on from the in is we then hours that

cash about we very but renewables good would they're into the of go generating. discussions -- and it, more what we So again, about feel can profile

Stephen Coughlin

EBITDA add, in the just Angie, the would U.S. I on the is also growing Yes. significantly. profile, EBITDA

in LatAm Brazil where the low said Panama, I think some hydro in Niño, around things generation, quarter. we've you're El first had in happening not part as it seeing lower wind comments, for very had of my in has I example, the the because of in

number, and is in see won't substantial year, outside EBITDA a U.S. the even couple offset quarter, somewhat But it frankly, to the U.S. degree. this QX but by then low you And throughout solar same the growth factors irradiation there's the a within is U.S. so growth that very of those other

EBITDA the strong. is So

in of And this the developing machine for mention been perfecting I'd years. thing many many, terms we've renewables, other

So gotten development has efficient. the quite

our able process. development through to high rates are We success drive

cost relative online. so to to down, And come successfully projects continues that bringing

go more this separately, perhaps attractive detail profile but it's but for into we a can -- So business. very

Agnieszka Storozynski

And developed -- into And that virtual you then mentioned directly of mean but are about close and think hyperscalers. those the more just all mean, separately, the grid variability PPAs, and given wondering, more about with these centers. so you data is congestion? I transmission I I'm right? these it mentioned like that feeding projects proximity, geographic I So discussion of there's there's -- not in just a

to Again, net-zero to have they the have proximity I of facilities. the at the of a in sort understand hyperscalers goals. have But of reliable day, that power access the end these

trying just machines. in far how understand the help honestly I'm XX/X on renewables again, keeping lights somewhere will So to built demand these

Stephen Coughlin

good points. good Angie. all Yes, It's --

absolutely you're that important proximity within region. the so And right the is

Now they're really the renewables. said, for, is of they're that they looking terms load grid, regardless, this adding looking renewables But to interconnection of you're co-location, meaning as regardless think, is. looking a data the for where Andres new overblown and new and center I are in needs additionality, for what approval,

data way a And you you minimizing want able want do want technology as our well that batteries transmission a storage to so very tremendous as region in battery we been center. be many then decade be We've smart add to your so upside. And developing long the battery within portfolio to them And time, a in Fluence in to charges, by see of a cases. do plus. in for storage, both you projects

that's a their throughout meet needs advantage us able in huge for carbon-free So the day. entire being to

to those solar, in sites with having the flexibility. battery able region sites, that being in key so And the with the have wind is

this. by jumping So it's not a market you can into tap into just

advanced -- foresight regions years-plus have X be for You these have been these to technologies developing all that. in within do to to had

the say center the ERCOT, that are then data which it's MISO, like much up and the the because availability more solar, the country other for for And the -- -- more Coast. and thing is towards about land expanding we've middle would congested many in are more regions so opening locations, this, talked in I into locations wind, less have of

data ensuring of advantage an terms in your to that's so you're centers locating your sites close as And well. generation

Andres Ricardo Gluski Weilert

good really is the are centers. these the less data than thing Angie, that latency, because points immediacy, traditional AI Yes. new requires other

as to it regional green But opens for the to always example, hydrogen first, we've be up has an possibilities. that, felt, example, minimize So on geographic it transmission.

it should that Second, be additional.

do. we something it's that fact can the And already match a is

of like that co-located, much street. actually particular hydrogen So across in green it's the pretty case the is our project, X

that on But it So just a conditions. very more much where particular I But works. favorable. of up think depends transmission that's case that opening is the very geographies

Operator

Michael Sullivan Our Research. of from comes final question Wolfe

Michael Sullivan

just back and utility to wanted there. angle data center I on the side circle the

seeing, that? I to do you large a that think you be alluded IRP to is been bit, we can I little color announcements enough there should you Indiana. any thinking more guess, it made? cover little have particularly a the out about in you How And have but on particularly you're give what think

Andres Ricardo Gluski Weilert

What in X in with to involved see. attributes, for hyperscalers there other we're that and is is these our Let's transmission had certainly, possible I mentioned utilities negotiations in my interest due as speech that, locations.

an be outside demand Now be onto would of would IRP our be put additional this the because would per systems. this se that

Michael Sullivan

anymore? specific Okay. the works But nothing in

Andres Ricardo Gluski Weilert

we specific We time. just to talked We announce it, have at it was nothing what this purely. important we've we about talk when thought about because done

the -- is able more haven't we doing that for for to first mentioned, some providing ourselves. that data about centers, and might for and time We actually the other energy do be talked well, we we're utilities this example, megawatts to

Stephen Coughlin

Yes.

about, it has plan look as really, Mike. upside, it So I is is at what the would

sight in we manufacturing, talked manufacturing, but of what they assumed very are line places but have chips we only data know sort attractive battery industrial So also of not centers, development Ohio, in we to about. for becoming

think that to upside plan So I will there discrete some be down road. additions will be our the

Andres Ricardo Gluski Weilert

in But very In seeing closing, is a centers. good what growth up It's not data point. brought corporate Steve demand. just we're

our in service the is, what U.S. a So for you're seeing areas reindustrialization of example,

because electrification which for about So they're And have to very add you EVs, it is people the fast. been is whether panel have other EVs growing substantially. as load in very the battery then selling, manufacturing, have onshoring, if fact you growing be manufacturing, not talking but they're things,

less at, look Charging if are example, the growing some of growing. stations for people have put XX% out than that They're just China, sold of you are there. But forecasts EVs. vehicles

from increased what these is from sources. corporations see of demand all So an we

sweet We investment-grade with companies have doing both. tech well particularly our focused and What spot. as offtakers. And dollar-denominated really data contracts again, same. we internationally, centers -- it's long-term want and the on on is But we're

sector. the about very So optimistic

Michael Sullivan

I using could Fluence on Okay. just And squeeze if in, just one funding thoughts as a source. one last latest

Andres Ricardo Gluski Weilert

the Fluence later on comment don't We call has its that, in frankly. week. And quite on

So -- next week. or

So further no, on color any give that. can't we

you. Thank

Operator

back Susan hand With that, Harcourt. I'll to

Susan Pasley Harcourt

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

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

Operator

this gentlemen, and for joining. Thank concludes Ladies call. today's you

may disconnect lines. You your now

The AES Corporation (AES) 3 May 242024 Q1 Earnings call transcript