Hello, and welcome to Clearway Energy, Inc. Fourth Quarter Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] I would now like to turn the call over to Akil Marsh. You may begin.

Thank you for taking the time to join Clearway Energy, Inc.'s fourth quarter call. With me today are Craig Cornelius, the company's President and CEO; and Sarah Rubenstein, the company's CFO. Before we begin, I'd like to quickly note that today's discussion will contain forward-looking statements, which are based on assumptions that we believe to be reasonable as of this date. Actual results may differ materially. Please review the safe harbor in today's presentation as well as the risk factors in our SEC filings. In addition, we will refer to both GAAP and non-GAAP financial measures. For information regarding our non-GAAP financial measures and reconciliations to the most directly comparable GAAP measures, please refer to today's presentation. In particular, please note that we will refer to both offered and committed transactions in today's oral presentation and also may discuss such transactions during the question-and-answer portion of today's conference. Please refer to the safe harbor in today's presentation for a description of the categories of potential transactions and related risks, contingencies and uncertainties. With that, I'll hand it over to Craig.

Thanks, Akil. Turning to Slide 4, we are very proud of the year that Clearway just turned in over 2024. Our financial and operational results exceeded our key objectives, we completed the core growth objectives that we'd established and we simplified and strengthened our platform in ways that enabled these successes and set us up for a bright future. In addition to achieving these outcomes in the year just passed, we made further progress towards meeting the long-term financial goals we set for 2027 and beyond. I remain confident that this platform has the long-lived asset base, growth trajectory and capital allocation flexibility we need to deliver sustainable earnings growth through the balance of this decade. For 2024, we met our dividend per share growth commitment while delivering full year CAFD ahead of our guidance. We also committed to approximately $450 million of growth investments this year at Accretive Economics while bringing online over 1 gigawatt of renewable power generation and energy storage capacity. Looking ahead to 2025, we've reaffirmed our 2025 guidance range and have gained further confidence in our ability to meet the midpoint or better of that range through CAFD expected to be contributed by committed investments and the ongoing strength in the performance of our fleet. On top of the Tuolumne investment which we've since signed, we're enthused by the additional announcements we're sharing today that firmed up the predictable earnings power that we expect our existing fleet to contribute as we drive towards the top half of our 2027 target range of $2.40 to $2.60 per share. We are making attractive investments in our existing fleet with the commitment to invest in Phase 1 of the Honeycomb storage projects and the repowering of Mt Storm, which is underpinned by an awarded PPA with a major…

Thanks, Craig. On Slide 10, we provide an overview of our financial results which include full-year adjusted EBITDA of $1.146 billion and CAFD of $425 million. Fourth quarter adjusted EBITDA was $228 million and CAFD was $40 million, which reflected strong wind resource at Alta, offset in part by lower wind resource across the remainder of the portfolio, along with the benefit of timing with respect to the receipt of payments for insurance proceeds and due under-service contracts. Our fourth quarter results in our Flexible Generation segment, formerly known as Conventional, reflected solid availability and the benefit -- a beneficial impact of energy management activities. We are also pleased with our full-year CAFD results of $425 million as compared to our guidance of $395 million, noting that it reflects the diligent work of our operating teams to carefully manage our assets and secure payments due under service agreements with our equipment suppliers. Additionally, our primarily unlevered assets, Flexible Generation segment have provided strong availability and grid reliability during the year, helping us to exceed our expectations for the segment in 2024. We continue to reiterate our 2025 CAFD guidance range of $400 million to $440 million with a target to achieve the higher end of the range through the timely completion of growth investments, the closing of the Tuolumne acquisition and continued focus on the availability and management of energy margin for our Flexible Generation fleet. The guidance range reflects P50 renewable production expectations at the midpoint with the upper and lower ends of the range reflecting variability in potential outcomes for resource and availability. The company remains well-positioned for growth with a strong balance sheet, forward-looking credit metrics in line with target ratings and 98% of its consolidated long-term debt with a fixed interest cost. To fund growth to…

Thanks, Sarah. Turning to Slide 12. Key among our multiple pathways to growth in 2027 and beyond is Clearway Group's late-stage pipeline, which we continue to believe is in a strong position. As a reminder, Clearway Group's late-stage pipeline is diverse in technology and regional composition. Clearway Group has made investments to secure qualification for tax credits for projects across multiple COD vintages, has established framework agreements with major equipment suppliers, enabling access to domestic and risk-mitigated supply chains, and possesses a robust backlog of derisked interconnection queue positions. Also, Clearway Group is managing its progress through the federal permitting nexus where applicable with a systemic approach and with confidence that its historical success and policy aware development will continue. Beyond the projects that have already been committed to or offered, Clearway Group's late-stage pipeline represents over $750 million of potential corporate capital investments through the 2029 vintages. This amount includes at least $250 million of incremental investment opportunities in the 2026 and 2027 vintages that can support delivering 2027 CAFD per share at the high-end of the range. In summary, Clearway Group's pipeline provides more than sufficient capital deployment opportunities to meet CWEN's growth objectives through 2027 and beyond. Turning to Slide 13. We're also pleased that we have been enhancing our positioning as a leading energy provider for the rapidly growing demand that is emerging from the rise of digital infrastructure and reindustrialization here in America. The fact that the US is poised for secular electricity demand growth is something this audience is familiar with already. But given our conservative organizational culture, the multitude ways that Clearway is poised to benefit from this trend have been less apparent up to now. Though we intend to remain true to our culture and being deliberate about communicating commercial agreements and…

[Operator Instructions] Our first question comes from the line of Michael Lonegan with Evercore. Your line is open.

Hi, thanks for taking my questions and congrats on a solid update. So as we think about your excess debt capacity, you're now saying $300 million to $400 million versus the $300 plus million last quarter. Your total liquidity position hasn't changed much, so adding incremental CAFD without debt is not too different. I was just wondering if you could talk about what now potentially gets you to the $400 million versus the $300 million-plus previously.

Yeah. Thanks for the question. Appreciate the recognition. The basic expression of that range reflects the outlook we have for a long-run CAFD contribution from the fleet incorporating some of the latest updates as I think you're implying. And it's our intention to maintain that kind of outlook for incremental debt capacity in a way that incorporates investment commitments that have been made, CAFD that's been contributed by changes in our operating fleet as well as new commitments of that kind. And with that, Sarah, I'd love to turn to you if there's anything you'd like to add.

No, I think you kind of covered it generally, but essentially, we have -- based on what we've been working on and what we're able to do with the existing fleet in terms of recontracting our assets, we feel comfortable that we can achieve with up to that $400 million of excess debt capacity-based on -- without sort of investing incremental capital and adding additional commitments. I think we still express that in a range because there's obviously a variety of outcomes that can occur. But as we sort of continue to execute on our plans and firm up some of the incremental CAFD that we can realize from the existing fleet, we feel more comfortable including that $400 million as the high-end of the range.

Got it. Thank you. And then as we think about the new political administration, the reciprocal tariffs, the tariffs on steel and aluminum, and the 30-day pause in Mexico and Canada coming to an end soon. I was just wondering if you could talk about what portion of Clearway Group's supply chain is at risk, and how quickly you would be able to shift to new suppliers and also if you expect delays or renegotiations of PPAs due to increased equipment costs.

Yeah. Thanks for the question. Yeah, I think, planning for and mitigating policy risk is a competency that differentiates our company and has over time and the present circumstances are one that really play to our strengths. So, for the range of changes in tariff for applicable duty rates that have been announced so far, the Clearway Group sponsor entity has put in place either arrangements with respect to revenue contracts or arrangements with respect to equipment suppliers and relationships with them in a way that allows for the projects that have been planned to contribute to CWEN's growth goals that have been committed to already or identified as part of its near-term growth pathway to be able to proceed on the schedule that was planned while absorbing the implications of those changes in applicable duties. And what we're finding in general is that the importance of near-term constructible projects that are well structured and are located in places where customers need them is such that the incremental cost that's attributable to tariffs like the ones that you've noted can be absorbed in some way that's reasonable by the pricing of the revenue contract, while still delivering a really compelling value proposition for our customers. So, we were planning for scenarios like the ones that are emerging now in US trade law and are pleased that the positioning of our projects and the relationships we have with our customers and with our equipment suppliers are allowing us to continue to proceed in construction even with those changes in applicable trade policy.

Great. Thank you very much.

Thank you. Please standby for our next question. Our next question comes from the line of Julien Dumoulin-Smith with Jefferies. Your line is open.

Hey, good afternoon. This is Hannah Velasquez on for Julien. Thanks for the call and congrats on the quarter. My question is around M&A opportunities that you alluded to. So, what sort of assets or technologies are you looking at? Primarily, is it wind or solar, is it more of the gas fleet? And then separately, I know you talk about not really needing any equity or big equity raises to get to 2027 midpoint and potentially better. But for the right transaction, would you consider a big block common equity raise?

On the first question, I think as we have historically, we select for potential operating asset acquisitions based on a few key factors. First, complementarity to the existing technology, resource and customer portfolio that we have. Second, opportunities to extract cost or operating synergy based on proximity or similarity of technology. Third, the ability for Clearway to apply some kind of unique value addition to the operating assets through some commercialization or technology change. And then last and essentially the compatibility of the investment with the corporate capital allocation framework we've committed to our investors and those are the same principles that we apply in today's environment. We are presently looking at projects that span the same family of resource technologies that make up our fleet today, which include all of wind, solar, battery and gas resources. We would expect the business to continue to look like it does today where emissions-free resources are really the principal contributor of generation output for the facility -- for the company and its earnings powers. As far as magnitude of transaction, I think what we feel is that we've made a really clear roadmap that's compelling to our investors. And first and foremost, we want to focus on acquisitions that are rightsized and complementary to our growth profile without unduly disrupting the capital allocation framework that we've laid out so far. But we are at a time where big enterprises of scale will want to remain cognizant of the bigger opportunity set. And so, we will do that. But at the moment, we are focused first and foremost when engaging on M&A around acquisitions that are compatible with the corporate allocation framework we've laid out and that enable us to complete a set of commitments that underpin our goal to meet or exceed the top half of our 2027 CAFD per share range.

Okay, super helpful. Thank you. And then just as a second question, on the two contracts, the RA contract signed for El Segundo, I know previously, I think last quarter you talked about hopefully signing additional capacity at levels that you saw throughout 2024. Was there any upside to where you priced El Segundo at or was it fairly consistent where you expected to be? I'm just trying to see if there's any incremental upside to getting towards the midpoint or better on 2027 guide?

We priced those latest contracts for El Segundo consistent with the pricing we estimated we would realize for resource adequacy sales in order to deliver on the range that we'd articulated. So that capacity cleared at the levels that would be necessary for us to hit the midpoint or better of our 2027 CAFD per share range and where the balance of the open position clears will help us determine where in that upper half of the range or better we'd land.

Thank you.

Thank you. Please standby for our next question. Our next question comes from the line of Noah Kaye with Oppenheim & Company. Your line is open.

Thanks, folks for taking the questions. This very interesting slide on the data center capabilities. I just want to unpack it a little bit. First of all, just not sure I heard it correctly. Did you say that you had 5 gigawatts of projects in development for the meter or gigawatt scale in five states? Just trying to clarify.

We said both.

Okay. All right. Maybe the question that will help us best understand the opportunity set here is to think about how your land positions, your interconnection, your mix of resources aligned with the data center development ambitions of some of the hyperscale and co-lo customers you're clearly talking to here. Talk to us a little bit about that and where you think you might have an advantage in terms of speed to market?

Yeah. The first, for front of the meter arrangements, the 5 gigawatts worth of projects we've referenced, there are projects that are in service territories where either through utility sleep relationships or deregulated power sales, we have renewable or battery project that can deliver on the shape needs of hyperscalers in that market during the time frame where in the next year hyperscalers would be procuring supply. And I think something we've seen in the last six months and I've noted in your research and others is that hyperscalers, utilities who serve them, other commercial industrial companies continue to see great usefulness in the supply of front-of-the-meter power, in particular in places where there's density of load growth. So there's a lot for projects that deliver power under busbar contracts or hub settled contracts to do in order to support load growth over the course of the next three or four years, which is the time frame of supply for which hyperscalers are procuring now in particular, resources that come align in the next three years. So those projects are mature. They're being sponsored by a company that knows how to deliver them. In a lot of cases they're in places that exhibit complementary load shape and you see some of the repowering projects that we had announced as evidence of, where wind shape in a lot of these places is proving to be kind of useful for data center load growth support. And then in terms of, sort of other more complex co-location project concepts. We have a lot of acreage in different places in the country where the combination of data center location, wind or solar construction and gas CT or battery construction are feasible and can support more sizable load construction. And I think we noted starting back in July that we were working through our bank of those resources and engagements with colocation developers and data center customers to determine which of them are most complementary for individual customers. I think we found that a lot of those development resources are complimentary to their plans. And as a company that knows how to operate and construct really all of the constituent technologies that are needed, I think we bring credibility to those conversations that helps our customers choose to focus on us. So, I think we've gotten a lot of questions about what the rise of industrialization and digital infrastructure will mean for Clearway and we've wanted to start to answer those questions with an affirmation that it will mean eventually additional investable opportunities. And I think what you can probably count on from us is that when we've got commitments that are definite in terms of their asset construction and their potential financial contribution that we'll share more about them, and we're optimistic about what the future holds.

We're looking forward to that. I'll take the rest of my questions offline. I appreciate the response. And I'll echo congrats on the strong results.

Great. Thanks, Noah.

Please standby for our next question. Our next question comes from the line of Justin Clare with ROTH Capital Partners. Your line is open.

Hi, yeah, thanks for the time here. So just wanted to follow-up on the opportunity here with data centers. And you actually have capabilities maybe in solar, in wind and storage. And so just wondering if you could talk a little bit more about the solutions that you might be offering data center customers? And then maybe if you could speak to how contracts are being structured. Are you looking at potentially providing round-the-clock renewable power? And then I guess the last piece here, just if you're thinking about behind-the-meter opportunities, can you potentially get to build those quicker by avoiding interconnection cues? Is that something that you're evaluating here?

I think what we and others find is that any engagement around an energy solution starts with what's technically possible in one place or another, first, and then second, what applicable rules for interconnection and cost allocation work for those resources. And as you and others have noted, those rules are in varying stages of formation from one power pool to another and there's more for us yet to all see in terms of what the FERC has to say about all that. But what we are generally engaging with customers around are concepts for technology-driven physical infrastructure around which some family of revenue contracts could be structured that generally don't attempt to aggregate all of those technologies as though they're one, but acknowledge that you have multiple generation sources all-in some common location. And each of those probably deserves its own unique type of revenue contracting instrument. And I think for the right family of infrastructure technologies that are responsive to a given customers' needs, one can find some kind of revenue contracting structure that's compatible with regulation and what the technologies can deliver. But I think we sort of feel like it's kind of premature to get into the details of that today. We have wanted simply to make it clearer because folks have asked what our family of technologies allow for and we're optimistic about what they will.

Got it. Okay. That's helpful. And then one more. I just wanted to ask about there is the President's executive order on federal permitting for wind projects from January. Just wondering if you've seen a change in Clearway Energy Group's ability to secure permits for wind projects or for solar or storage as well? And then just thinking about the repowering opportunity, is there any challenge in securing those permits? Is it easier? Maybe just speak to how things have evolved here?

Yeah. I mean, I think it's been a changeable landscape over the course of the last 45 days, but I think we have found that Clearway Group is able to continue to make progress in advancing its development pipeline and that leaders of the new administration and the agencies that make up the administration are continuing to make progress on advancing the administration's energy dominance agenda, mindful of how important it is to enable projects that can be constructed in the next three or four years to be constructed. For Clearway Group specifically of the 9 gigawatt late-stage pipeline that was referenced in our materials today, there's only 390 megawatts worth -- 391 megawatts worth of projects that rely on the issuance of some sort of federal right of way. That's more directly implicated by the executive order and the balance of the projects are being executed on private lands and a large quantity of them already have in hand determinations of no hazard or are not susceptible to consideration under the executive order because of the technology that they employ. So I think for the -- I think what we're finding for the projects that are really essential for Clearway Group to advance for Clearway Energy, Inc. to meet its goals, they're able to keep progressing and we're optimistic that the administration and the fullness of time will also recognize how important it is for all these technologies that can be deployed in the next four years to turn into new spinning hardware in the ground. And as far as the other question that you posed beyond executive order susceptibility was what? I'm sorry.

I had mentioned just on repowering. Is there any differences…

Yeah. On the repowering, yeah, I think what we've actually found is that some of these projects are executable with a greater level of certainty. And I think that's one of the things that's really positioned them to exhibit a great value proposition for the customers we plan to serve with them and for Clearway Energy Inc.'s reinvestment. So I think we're optimistic about the embedded value in operating wind projects and projects that can be repowered and certainly, a diminished risk profile and execution is one of those value propositions.

Okay. Got it. Makes sense. Thank you.

Thank you. Please standby for our next question. Our next question comes from the line of Mark Jarvi with CIBC. Your line is open.

Thanks, everyone. Great update here tonight. Just, Craig, maybe on the commentary around the 2027 targets. I think you're kind of saying that you're getting close to the midpoint of the range now. Is that with the view that Mt Storm comes online after -- effectively after 2027 is not really included in that projection at this point?

Yeah. That's good question. Yeah, the bulk of its long-run CAFD contribution will be in 2028 and beyond based on the phasing of its construction though that will start construction at the end of this year. [Technical Difficulty] growth capital commitments that we've announced today along with some of the evolutions in [Technical Difficulty] have shifted our outlook to the point where we're really focused on delivering the top half of the $2.40 to $2.60 per share range, meaning that additional agreements on our operating fleet or additional growth investments would be actions that we're executing to try to land us in that top half between $2.50 and $2.60 per share.

And then to that point, Craig, I think you were saying that there's still ample assets at the sponsor to facilitate hitting the top end of the range. Is that right? And then when you said $250 million, I believe, of capital commitments, was that inclusive of the storage projects identified on Slide 5? Or would that be on top of that? Yeah.

That includes -- it includes those projects that were constructible for funding and completion in 2026 and 2027 and then still others, which have not yet been identified, but will be identified in due course.

And then wanted to follow up on the CAFD yields, a nice step-up from the last update, 11% to 13% both on the third-party M&A and the organic. Is there something specific about some of those investments that have led to the higher CAFDs, you think that's sustainable? And then I guess if you can do acquisitions at 12% CAFD yields, we think that that's a lower risk-adjusted or pretty good risk adjusted return. Is that something you prioritize now if you can find more deals like that?

Yeah. Well, I think first of all, we're pleased that the CAFD yields on those announcements are further improved over the expectation at the time that those commitments were initially made or when they were initially offered. Those improvements were achieved through continued optimization of our plan for operating the projects or financing their ultimate funding or acquisition. And yeah, I think our goal will certainly be to deliver CAFD yields that are at the sort of highest achievable level with an acceptable risk profile that's consistent with the investment mandate that we've established for Clearway Energy, Inc. I think what we have -- what we've used to underpin the long-term growth goals was a 10% CAFD yield. And the commitments we're making and reaffirming today are still underpinned by that being the basic planning assumption for incremental corporate capital commitments, whether they are to operating asset acquisitions or new drop-down offers. When we've got the opportunity to secure an asset on a well-defined risk adjusted basis, both through trailing operating data or the kind of structure in its contracts that underpin the asset, we're certainly going to allocate CWEN's capital to the highest achievable long-term internal rate of return and CAFD yield. I think if it was our intention to lead you to expect 11% to 13% CAFD yields on a routine basis, we will let you know, but I think for the time being, the way we'd suggest you think about these outcomes is they represent our relentless focus on value optimization and you know, we'll try to continue to deliver CAFD yields that are very compelling, but it would be premature, I think, to rerate the entire expectation for further growth capital investments just yet.

Understood. Thanks for the time today.

Thank you. Please standby for our next question. Our next question comes from the line of Angie Storozynski with Seaport. Your line is open.

Thank you. So I was just wondering, you're clearly reflecting your higher cost of capital in the returns on the assets you're acquiring. But I'm just wondering, I mean, is this -- you continue to execute on your growth targets or if not exceed them? You show this a long-term financing plan and yet your cost of financing is not subsiding. I mean, is this just the -- the plan is to just stick with the plan and then continue to execute and then wait for the market to recognize how different you are versus your peers or will there come a time where you might consider some other options? Thank you.

I think we are very proud of the work we've done as a company really throughout the life of Clearway Energy, Inc. as a public entity. And I think our history of making good on financial commitments once made and assembling a business that's run with discipline within our means, I think will prove out over time how compelling a business model this is. We look at the 5% to 8% plus CAFD per share growth goals that we've laid out as compelling and absolutely consistent with what the best leading edge mid-cap utilities in the United States deliver. We look at the corporate capital structure that we've put in place and commitments we've made around that as being disciplined and cautious. And I think, Angie, our hope is that in due time, that prudence as well as the compelling growth proposition we're offering is going to be rewarded with cost-of-capital and a share price that really reflects how compelling it is. So, I think we like the plan we've built, we know how to execute it. We're aiming at executing really the top end of the range of it. And our intention is to do that. And I think our hope is that through actions, we'll find that our financial stakeholder base are going to reward us with a compelling valuation that drives to the kind of cost of capital outcome that I think you're alluding to.

Okay. And then separately on the third-party M&A, you guys have looked at numerous projects for many years it seems with few findings. So what's changed? I mean, you feel like there is -- it's just the time has lapsed that these owners of assets have waited long enough? Or is there some sort of shift in the investment focus for those sellers? I mean, what do you think drives the higher appeal of some of the assets that you're looking at right now?

Yeah. Well, I think, so far, the types of acquisition Tuolumne is representative of the limited number of asset centered acquisitions we've executed in the past where we had a relationship with the pre-existing owner. We were well-positioned to be able to operate it. We were in a position to be able to potentially repower it in the future. And all those things made it really compatible with our ability to do something unique and value creative for the asset. That was true also for Mt Storm, which we'd acquired a few years ago with the expectation we were eventually going to repower it like we are now doing. It played to our strength in Mid Atlantic wind. And for the time being, we're really focused on, first and foremost, asset acquisitions of that kind, whether they're a single asset or a portfolio of them. And what I think is marginally different today than you might have seen a few years ago was that the environment of demand for our financial investors who could compete against us as a financial sponsor has dissipated somewhat. And for sellers who are looking to find somebody else to acquire their project or improve it, we stand-out now more as somebody who is a certain buyer who is in a good position to be able to do something to improve their asset. And I think just the community of buyers is now a shorter list for contracted renewable operating assets than you might have seen in the past. I think we're sober about how long these cycles last in our industry. So I wouldn't assume that it's going to be an environment that is hugely advantaged forever. But when we do end up with these moments of opportunity, we want to be ready to work hard to execute on investments that exhibit a compelling value proposition and hopefully we'll do so over the course of the next six months, but just in ways that are measured.

And then just last question. So, we saw some recent M&A deals involving renewable power portfolios where public entities team up with their financial sponsors. Is that an option for you now that GIP has been acquired and basically has a larger financial backing?

I think for Clearway one of the things that we really consider a blessing is that between both GIP BlackRock and Total, we enjoy financial sponsors that are amongst the biggest and most committed investors in clean power assets here on planet Earth. And if we have some good idea as an operator or a development agent that is compelling but requires financial resources beyond those that we can prudently deploy. It's an idea that we can still engage on by virtue of the relationship that we have with GIP, BlackRock and Total. So, hopefully, we will find more opportunities that give us the chance to deploy the capital of Clearway Energy, Inc, in a way that's compelling and leverage the substantial market presence and investment power of those entities as well.

Very good. Thank you.

Thanks, Angie.

Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back to Craig Cornelius, CEO of Clearway Energy for closing remarks.

Thanks, everyone, for joining us today and for your ongoing support of Clearway. We're looking forward to continuing to demonstrate to you what we really think is a leading market position in the coming quarters that is further magnified by our operating excellence and discipline. Operator, you can close the call. Thank you.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.