Good morning, ladies and gentlemen, and welcome to the Q2 Algonquin Power & Utilities Corporation Earnings Call. Following the presentation, there will be a question-and-answer session. I would not like to turn a call over to Amelia Tsang. Please go ahead.

Thank you. Good morning, everyone. And thanks for joining us this morning for our second quarter 2022 earnings conference call. Presenting on the call today are Arun Banskota, our President and CEO; and Arthur Kacprzak, our Chief Financial Officer. Also joining us this morning for the question-and-answer part of the call will be Jeff Norman, our Chief Development Officer; and Johnny Johnston, our Chief Operating Officer. To accompany our earnings call today, we have a supplemental webcast presentation available on our website, algonquinpowerandutilities.com. Our financial statements and management discussion and analysis are also available on the website as well as on SEDAR and EDGAR. Before continuing the call, we would like to remind you that our discussion during the call will include certain forward-looking information, including, but not limited to, our expectations regarding earnings, capital expenditures, pending acquisitions, asset recycling, growth and pending legislation. At the end of the call, I will read a notice regarding both forward-looking information and non-GAAP measures. Please also refer to our most recent MD&A filed on SEDAR and EDGAR, and available on our website for additional important information on these items. On our call this morning, Arun will provide an overview of our Q2 performance. Arthur will follow with the financial results, and then Arun will conclude with an update on our strategic plan for the business. We will then open the lines for questions. I ask that you restrict your questions to two and then requeue, if you have any additional questions to allow others the opportunity to participate. And with that, I'll turn it over to Arun.

Thank you, Amelia, and a very good morning to those who have been able to join us on the call and online. I am pleased to report that we are on track with the following key financial metrics. Q2 adjusted EBITDA was $289.3 million or 18% increase year-over-year, and our Q2 adjusted net earnings per share was $0.16 compared to last year's $15. We reported a strong second quarter as our businesses delivered solid operations, which Arthur will go into more detail. We see ourselves as a business built from long lived assets and strong operations, and we've consistently been able to produce stable financial results. We remain confident in our plans to continue delivering strong returns to our shareholders. We continue to focus on Algonquin's three strategic pillars, growth, operational excellence, and sustainability. And I will provide more details on each of these pillars. We have high confidence in our five year $12.4 billion capital plan, given the large proportion of growth that is organic and the number of growth levers we have. One of the most important growth levers in our regulated business is deploying capital to benefit our customers and investing in our rate base. In the second quarter, the Missouri Public Service Commission issued its final report and order resulting in a total revenue increase of $39.5 million with new rates implemented on June 1, 2022. We believe the settlement represents a fair outcome for customers and the Company. Also during the quarter, Senate Bill 745 was signed by the Governor in Missouri, which modifies Plant-In-Service Accounting or PISA. This bill also puts into law, a property tax tracker, which is expected to enhance our Missouri utilities ability to earn their authorized returns. Another growth lever on the regulated side is from our acquisitions. As many…

Thank you, Arun, and good morning everyone. In the second quarter, we delivered solid results, reflective of the strength and resiliency of our core businesses. Our second quarter 2022 consolidated adjusted EBITDA was 289.3 million, which is up approximately 18% from the $244.9 million we reported for the same period last year. The regulated services group delivered $185.9 million in operating profit in the current quarter, which compares to $161.1 million in the same quarter last year, an increase of $24.8 million or 15%. This increase reflects the normalization of our operations as well as the implementation of new rates across some of our utility systems, which added approximately $7.1 million as compared to the prior year. This was partially offset by a one-time catch up of distributions received from our San Antonio water system investment recorded at a prior year. The increase in operating profit also reflects the addition of Liberty New York Water, which was acquired in January. As a reminder, this utility is impacted by seasonality and is expected to earn over 60% of its operating profit during the peak summer months, primarily in the third quarter. The renewable energy group reported first quarter divisional operating profit of 117.9 million, which compares to 97 million in the same quarter last year, representing an increase of 20.9 million or 22%. Existing wind and solar generation facilities added approximately 14.2 million to operating profit and generation from newly commissioned facilities and investments added 4.1 million. In general, results benefited from increased production from our renewables fleet which was in line with long-term averages as compared to approximately 12% below long-term averages experienced for the same period last year. The higher production was partially offset by higher operating costs as well as underperformance from our investment in the Texas Coastal…

Thank you, Arthur. Before we close out our prepared comments this morning, I want to give an update on our strategic initiatives. I'm excited about the prospect for Algonquin's regulated and renewable businesses, which are both well positioned to contribute to and benefit from the decarbonization transformation that is currently underway and which will only accelerate over the coming years. With our increased scale of 4,000 megawatts, we expect to get incremental benefits including improved negotiating power, lower transaction costs, and access to greater opportunities. This includes the opportunity to partner with institutional investors who wish to invest in long-term contracted sustainable assets by selling down a portion of our assets and earning a recurring operating fee. As I mentioned on our last call, we have formally comments our inaugural asset recycling process with a portfolio of assets in the range of approximately 750 megawatts. The portfolio consists of four wind assets located in Canada and the U.S. The process continues to advance and we have received strong interest. As you can appreciate, we are not at the stage where we can provide a fulsome update and we look forward to giving you details as a process concludes. Key objectives for us are increasing the scale of our development and operational platform, together with increasing the amount of internally generated cash for future growth. Asset recycling is part of our enhanced renewable plan, and we expect this to occur on a recurring basis. Before wrapping up my formal remarks, I want to comment on the Inflation Reduction Act of 2022. We are pleased to see continued progress towards the passes of the Inflation Reduction Act, which is necessary to continue driving the push towards Greening the Fleet. Many provisions in the draft legislation could provide tailwinds to Algonquin and help…

Thank you. We will now take questions from the telephone lines. Our first question is from Dariusz Lozny from Bank of America. Please go ahead.

Hi, good morning. And thank you for taking my question. I just wanted to maybe discuss a little bit more detail the progress of talks on the sale of Kentucky Power. You mentioned that you continue to expect the transaction to close in the second half of the year. Can you just give a little bit of color or clarity as to the pace of talks at the moment, sort of like what the next upcoming gating items might be? And any other maybe detail as far as within the second half, what would it be, the early partner, perhaps the middle or later part of the second half of the year that you might expect the transaction to close?

Sure, Dariusz. Great question, obviously, right. So look, we -- as you know, we received the order from Kentucky back in May and then on July 1, we received an order from the West Virginia Commission and those two orders were clearly inconsistent. And so, what we are doing is working closely with AEP as a seller to come up with a resolution to those inconsistencies. And there are questions whether we go back to the commissions or cover everything in a filing in front of FERC. So all of those questions remain outstanding and that is the reason why we've said we, while we remain confident in our ability to close the transaction, given the regulatory requirements, we basically said the second half of 2022 just to remain on the safe side.

Okay, got it. Thank you for that color. One more, if I can, just pivoting to the R&G acquisition that you announced. Can you give a little bit of detail on what might be a run rate contribution from that project once it's fully up and running across all sites in 2023 and perhaps what the, any kind of metrics around the actual deal like what type of EBITDA multiple or any other metrics that we could think about?

Good, great question, Dariusz. I'll have Jeff respond to that.

Dariusz, I think the first thing to keep in mind is that we do treat this as an opportunity to learn and build our business. So, we don't expect it to be a significant contributor, but it is an important piece of our building out in RNG and learning. I can't answer the specific EBITDA run rate numbers, but in terms of once the two facilities have COD two more facilities are expected in 2023, which will give us approximately 500 MMBtu per day for around 155,000 per year. And so to give you a little bit of idea on scale, we're certainly happy to follow up with the EBITDA run rate.

Yes. We'll certainly follow up. Dariusz, the only couple of items the reason we're excited about this transaction is that it's in Wisconsin, and like I said, in my prepared remarks, the second highest number of potential RNG opportunities. So, we see this really as a development platform to grow our RNG business and especially given the significant negative carbon intensity say from dairy farms of as much as negative 400. This would represent a pretty sizable way to green our natural gas fleet. The only other color I'll give you is that. We also have projects in front of four different commissions on the regulative side of the business, and we're working through those regulatory processes to get those projects online as well.

Our following question is from Ben Pham from BMO. Please go ahead.

I wanted to follow up. You mentioned renewable asset sales, so last quarter was just wondering, if you had an update on timing or progress with that?

Sure. Ben look, we are making very, very solid progress on the process. I think from a macro perspective, what we're seeing is very strong interest, especially from a lot of large financial players wanting to buy into long lived, well contracted sustainable infrastructure. And also given some of global issues happening around Europe and Asia, we in fact see an even stronger interest in these assets that are in North America. So, we have seen a robust level of interest, and the process continues with management presentations all of those kinds of things, and we in fact looking forward hopefully to making you announcement sometimes in the second half of the year.

Okay. That's great. And I heard part of the last question around the inconsistencies in O&M on Mitchell. I maybe to expand on that was, is it inconsistent -- is it mostly really the calculation of the transfer value of just book value, salvage value? Was that the one that was, I know, it's probably more of a deeper answer than that, but was that the gist of it?

Well, for the most part, yes, I mean, there's also issues around operating of the assets between now and the end of 2028 when for Kentucky Power purposes the asset retires, but primarily you absolutely right. It's around the valuation.

And I mean, is it just -- maybe using simples to general a statement, but is it really just taking out the president of that O&M in your transaction and then really the transfer value, you can sort it out by 2028. I mean, just not kick it down the road, but it's just something you can deal with in a few years?

And we can certainly do that. However, from a risk perspective, we want to make sure there's more of a certainty as was in our transaction documents. And again, we are working very constructively with AP to come to a resolution. And like I said earlier in my prepared remarks as well, we remain highly confident that we are going to arrive at a conclusion. That works for all parties, and finally, especially the customers of Eastern Kentucky.

And we have no further questions register at this time. I would not like to turn a meeting back over to Arun.

Thank you, operator. Thank you very much for those who participate for taking the time on our call today. And with that, please stay on the line for our disclaimer.

Our discussion during this call contains certain forward-looking information, including, but not limited to our expectations regarding earnings, capital expenditures, pending acquisitions, asset recycling growth and pending legislation. This forward-looking information is based on certain assumptions, including those described in our most recent MD&A filed on CEDAR and EDGAR and available on our website, and is subject to risk and uncertainties that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. Forward-looking information provided during this call speaks only as of the date of this call and is based on the plans, beliefs, estimates, projections, expectations, opinions, and assumptions of management as of today's date. There could be no assurance that for looking information will prove to be accurate, and you should not place undue reliance on forward-looking information. We disclaim any obligation to update any forward-looking information or to explain any material difference between subsequent, actual events and such forward looking information except as required by applicable law. In addition, during the course of this call, we may have referred to certain non-GAAP measures and ratios, including, but not limited to, adjust in at earnings per share for adjusted net EPS, adjusted EBITDA, adjusted funds from operations and divisional operating profit. There is no standardized measure on such non-GAAP measures. And consequently, our method of calculating these measures may differ from methods used by other companies, and therefore, they may not be comparable to similar measures presented by other companies. For more information about both forward-looking information and non-GAAP measures including a reconciliation and non-GAAP financial measures to the correspondent GAAP measures, please refer to our most recent MD&A filed on CEDAR in Canada and EDGAR in the United States, and available on our website. And that concludes the conference call.

Thank you. The conference has now ended. Please disconnect your lines at this time and we thank you for your participation.