Clearway Energy Q2 2025 Earnings Report

Clearway Energy EPS Results

• Actual EPS: $0.28
• Consensus EPS: $0.67
• Beat/Miss: Missed by -$0.39
• One Year Ago EPS: $0.43

Clearway Energy Revenue Results

• Actual Revenue: $392.00 million
• Expected Revenue: $428.33 million
• Beat/Miss: Missed by -$36.33 million
• YoY Revenue Growth: +7.10%

Clearway Energy Announcement Details

• Quarter: Q2 2025
• Date: 8/5/2025
• Time: After Market Closes
• Conference Call Date: Tuesday, August 5, 2025
• Conference Call Time: 5:00PM ET

Clearway Energy (NYSE:CWEN) operates in the renewable energy business in the United States. The company operates through Conventional and Renewables segments. It has approximately 6,000 net MW of installed wind, solar, and energy generation projects; and approximately 2,500 net MW of natural gas-fired generation facilities. The company was formerly known as NRG Yield, Inc. and changed its name to Clearway Energy, Inc. in August 2018. Clearway Energy, Inc. was incorporated in 2012 and is based in Princeton, New Jersey. Clearway Energy, Inc. is a subsidiary of Clearway Energy Group LLC.

Clearway Energy Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Clearway raised its full-year 2025 CAFD guidance range to $405 million–$440 million, reflecting recent project acquisitions and targeting the top end of the range.
• Positive Sentiment: The company increased its 2027 CAFD per share target to $2.50–$2.70 and reaffirmed a long-term 5–8% annual growth goal with a 70–80% payout ratio at the low end.
• Positive Sentiment: Fleet optimization remains on track with the Mount Storm repowering (2026–27) and Goat Mountain repowering (2027), the latter backed by a hyperscaler PPA and $200 million capex at >10% CAFD yield.
• Positive Sentiment: Sponsor‐enabled growth is accelerating with all 2025 dropdowns on schedule and a new offer to invest in a 291 MW battery storage portfolio, supporting storage as 40%+ of the development pipeline.
• Negative Sentiment: Second-quarter results showed $343 million of adjusted EBITDA and $152 million of CAFD, hurt by below-normal wind resources and pre-repowering maintenance outages, though performance should improve.
• Positive Sentiment: Clearway’s funding plan includes ~$270 million of retained CAFD (2025–27), $600 million+ debt capacity, modest $50–$100 million equity issuances, and hedging of an $850 million bond refinancing to lock rates.

Presentation

[Operator]

Good day, and thank you for standing by. Welcome to the Clearway Energy Inc. Second Quarter twenty twenty five 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]

Please be advised that this conference is being recorded. I would now like to hand the conference over to your speaker today, Akhil Marsh, Director of Investor Relations. Please go ahead.

[Akil Marsh, Director - IR at Clearway Energy]

Thank you for taking the time to join Clearway Energy Inc. Second quarter call. With me today are Fred Cornelius, the company's President and CEO and Sarah Rubinstein, 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.

[Akil Marsh, Director - IR at Clearway Energy]

Please review the Safe Harbor in today's presentation as well as the risk factors and 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 may 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 call. 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.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Thanks, Akhil. Turning to slide four. Clearway continues to execute with discipline and we remain well positioned to create long term shareholder value through our multiple redundant pathways for growth. For the full year, we are updating our 2025 CAFD guidance range to $4.00 $5,000,000 to $440,000,000 raising the bottom end to reflect the contributions from recently closed project acquisitions. We continue to target the higher end of the 2025 guidance range.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Across the board, we're making progress on growth execution. Our fleet optimization and enhancement growth pathway continues to advance with repowering of Mount Storm on track for construction over two phases in 2026 and 2027, Goat Mountain now commercialized for repowering and expansion in 2027, and further potential projects in advancing stages of development. Our sponsor enabled growth pathway also continues to accelerate, with all of our committed growth investments on schedule for 2025 and an offer from Clearway Group to invest in a new battery storage portfolio in 2026. Furthermore, Clearway Group continues to advance its late stage pipeline, which includes a very substantial volume of renewable projects with safe harbor qualifications through at least 2029, a long term development footprint in competitive markets, and a leading battery storage pipeline, which now represents over 40% of all project capacity in development. And our third party M and A growth pathway also continues to demonstrate execution and expanding potential.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

We've now closed the previously disclosed Catalina solar project, which is running well for us, while also demonstrating efficient financial execution on financing of the Tuolumne wind project while preparing for its potential repowering by 2027. Both M and A transactions were effectuated at attractive long term CAFD yields and leveraged fleet synergies and value add from Clearway's platform. As a result of this progress, we are pleased to now be increasing our 2027 CAFD per share target range to 2.5 to $2.7 Beyond 2027, we remain committed to our long term objective of 5% to 8% CAFD per share growth, and we have set our sights on a payout ratio at the low end of our 70% to 80% target range. Turning to slide five. To provide a refresher on our growth strategy, we've built multiple pathways to achieve our long term CAFD per share targets, each aligned with our capital allocation framework.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

First, we optimize our fleet through repowerings, battery retrofits, new capacity and rec contract execution and PPA extensions, enhancing the value of our existing assets and extending their useful lives. Second, we grow our fleet through sponsor enabled dropdowns, which provide a sizable and recurring pathway for future growth with projects cited, crafted and structured to deliver accretive growth for CWEN. Third, we expand our asset base through acquisition of projects from third parties, focusing on projects that are complementary to our existing fleet and allow us to leverage platform capability for value added returns. In certain years, one pathway may drive more of our growth than other. And collectively, these pathways give us visibility to allocate capital over a succession of cycles with consistently high returns on capital as we reliably meet our long term growth objectives.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Turning to slide six. We continue to make steady forward progress on optimization of our existing fleet through repowerings, which are shaping up to provide significant investment opportunities over the next two years and to contribute to our 2028 growth in CAFD per share. Mount Storm remains on track with final notice to proceed slated for later this year at strong economics over two phases of completion in 2026 and 2027. At Goat Mountain, we're pleased to announce we've signed a PPA with a new hyper scaler customer and that we've set the stage for project execution through a turbine reservation agreement and development service agreement with Clearway Group. The project is on track for a 2027 COD, and we're now disclosing an expected corporate capital investment of $200,000,000 at an incremental annual CAFD yield above 10%.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

San Juan Mesa and Tuolumne also continue to advance toward potential repowerings and we expect to provide additional updates on those repowerings in coming quarters. Turning to slide seven. Our sponsor enabled growth pathway also continues to drive forward, enabled by our trademark risk management and forward thinking. All of the projects we previously announced as planned for 2026 COD have now been offered or committed to CWEN, with project execution on track for on time completion. We've now received an offer to invest in a two ninety one megawatt battery storage portfolio comprised of Rosemont South two and Spindle storage at CAFD yields aligned with our underwriting criteria.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Clearway Group has also identified late stage 2027 COD vintage projects for advancement and future potential offers, based on resilient tax credit qualification, advanced commercial interest, and derisked supply chains, among other factors. Overall, proactive planning execution in sponsor enabled growth has put CWEN in the enviable position that we can be confident that we can meet our growth outlook through 2027 and beyond. Turning to slide eight. We have increased our twenty twenty seven CAFD per share target range to $2.5 to $2.7 per share based on the maturing progress we've made on committed or potential investments that can contribute to our growth outlook. Since we initiated our 2027 target range last October, our organization has executed to the plan underpinning our 2027 goals while also maturing additional opportunities not incorporated in our original range.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

This has been on many fronts, ranging from additive third party M and A transactions like Catalina to PPA extensions like the one we secured for Will Dorado. Furthermore, today's battery storage portfolio offer provides an additional building block towards meeting the updated 2027 target range. Importantly, we have also started to lay the foundation for CAFD per share and dividend growth in 2028 with the Mount Storm and Goat Mountain repowerings as tangible examples that we'll continue to build upon in the quarters to come. Turning to Slide nine. Clearway Group has a substantial and strategically positioned pipeline to propel our long term growth.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Looking at the chart on the left side of the slide, you can see that Clearway Group is advancing development with an abundant supply of potential capacity additions to meet the long term growth objectives we have set for CWEN. While the corporate capital required in CAFD generated per megawatt can vary by project, you can clearly see the pipeline that Clearway Group is developing meaningfully exceeds the volume required to fulfill CWEN's growth objectives, providing optionality construction and funding schedules to be compatible with CWEN's capital allocation framework while also mitigating risk around any individual project's feasibility. Safe Harbor investments have been executed to qualify as much as 13 gigawatts of projects for tax credits through at least 2029, with methods that are conservative and conscientious of key policy considerations. Additionally, we are advancing a large backlog of attractive battery storage projects that represent a significant portion of our pipeline of projects with eligibility for tax credits well into the 2030s. Through 2029, the late stage pipeline Clearway Group is advancing includes over $1,500,000,000 of potential corporate capital investments for CWEN beyond already offered or committed projects and advanced repowerings, an aggregate investment amount more than sufficient to enable us to meet the long term goals we have established for CWEN.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

We will provide continuing updates around this opportunity set as we move forward, but feel confident that the mix of technologies, geographies and vintages provide us with ample raw material to enable deliberate growth that can fulfill CWEN's growth needs. Turning to slide 10. We are also pleased to highlight the way our geographic growth strategy has prepared us for a policy environment like our current one and for a long term future where incentive free competitiveness is essential for the renewable energy industry's growth. Those of you who have watched us for years will recall our historical focus on development in California, The Western States, and PJM, where renewable projects that are feasible to build can be cost competitive and can be delivered with clean, firm power attributes highly valued by customers. We clearly see how the wind, solar and storage assets we are advancing in these core markets can provide a compelling value proposition to customers into the next decade, even without tax incentives, and look forward to delivering them when and where needed.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Through this forward thinking development at Clearway Group, we are pleased to say that CWEN is in a prime position to outperform our peers in the clean power market while offering best in class long term earnings growth. With that, I'll turn it over to Sarah to walk through the financial summary.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Thanks, Craig. On slide 12, we provide an overview of our financial results. In the 2025, we achieved adjusted EBITDA of $343,000,000 and CAFD of 152,000,000 These results reflect our continued focus on strategic growth initiatives, including contributions from 2024 growth investments. In addition, our second quarter results reflect lower than anticipated wind resource in certain regions, as well as low availability for certain facilities where maintenance was optimized prior to near term repowering or changes in third party service models have been made to improve performance beginning in the 2025. As we noted during the first quarter, our first quarter CAFD results were higher than seasonally expected due in part to timing of debt service and distributions to non controlling partners, which are reflected in our second quarter CAFD results.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Our flexible generation results were in line with overall sensitivities and reflected the mild weather in California during the 2025 along with timing of certain maintenance costs. We are updating our 2025 CAFD guidance range to reflect the closing of the previously announced acquisition of Catalina Solar in July. And we are anticipating CAFD for 2025 to fall within the range of $4.00 5,000,000 to $440,000,000 continuing to target the higher end of the range. We are focused on execution and performance during the important third quarter with in line performance to date, and we continue to maintain disciplined focus on the availability of our entire fleet as well as the management of energy margin for our flexible generation fleet. The completed dropdowns of Rosamund South, Luna Valley Solar, and Daggett one storage are on track to achieve COD and be fully funded later this year.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Our guidance range reflects P50 renewable production expectations for the remainder of the year at the midpoint, with the upper and lower ends of the range reflecting variability and potential outcomes for resource and availability. Any future update of our 2024 guidance range is largely dependent on the outcome of our third quarter results. Moving to slide 13, we are well positioned to prudently fund our planned growth investments aimed to achieve our target CAFD per share goals in 2027 and beyond. Based on our updated 2027 CAFD per share target of $2.5 to $2.7 We expect to generate $270,000,000 or more of retained CAFD from 2025 to 2027 that we will utilize to fund a portion of our committed growth investments, along with excess debt capacity of $600,000,000 or greater, which is calculated by applying a corporate debt to EBITDA ratio consistent with our ratings target of four point zero to 4.5 times to our projected forward looking metrics. As we've stated for many quarters, our strategy continues to assume that we will opportunistically and predictably issue modest amounts of equity in order to fund accretive growth to facilitate the achievement of the top end or better of our growth targets.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

This committed growth has included recent third party M and A with CAFD yields above 12%, not embedded in our initial 2027 target range from last October. We plan to issue equity through discrete methods common in the listed infrastructure space, such as an ATM facility or through a direct stock purchase and dividend reinvestment plan, but only at accretive levels. To that end, we expect to make appropriate filings with the SEC to allow for the issuance of equity under these programs in the near future. We will be ready to effectuate modest discrete equity issuances from a position of strength that can help drive further CASCI per share growth and give line of sight to greater self funding with a lower payout ratio. We anticipate the use of both facilities to support our funding plans based on market conditions.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

During the second quarter, we began to regularly utilize our revolving credit facility as a source of temporary liquidity while we complete long term financing for our growth investments. We will look to put in place longer term corporate financing for growth investments and will consider opportunistically levering certain unlevered project assets as an accretive alternative source of capital if it makes sense. As we plan for the refinancing of our corporate bonds with the earliest maturity in 2028, we've sought to mitigate the risk of interest rate volatility by hedging the full notional amounts of the earliest maturity of $850,000,000 with forward starting interest rate hedges that will fix the base rate for the intended refinanced bonds in further support of our ability to meet our growth targets in 2027 and beyond. As we continue to advance our planned growth investments in support of our long term targets, including the offers of Rosamund South two, Spindle, and the Goat Mountain repowering project. There are available sources of capital to fund these investments beyond the thermal sale proceeds, providing a path to support our growth in a prudent manner.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Now I will turn it back to Craig for closing remarks.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Thanks, Sarah. Turning to slide 15. Thanks to the sound planning and execution of our organization, we have made excellent progress on the delivery of new project additions this year. We have a clear path to achieve our updated 2025 CAFD guidance, and we are pleased to be increasing our 2027 target CAFD per share range while honoring our DPS growth commitments. We are also excited about the progress we are making towards growth beyond 2027, consistent with our previously stated goals.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Aiming to fulfill those goals for CAFD per share growth, while funding more of that growth from organic cash flow enabled by a lower payout ratio. We look forward to sharing more about that long term growth outlook in our third quarter earnings call, as has been our practice in past years. In all this, we hope you see what we see in ourselves, a company that continues to deliver the best of what the clean power industry has to offer to its customers, to its partners, and to you, our valued investors. Operator, you may open the lines for questions.

[Operator]

Thank Our first question comes from Julien Dumoulin DUMOULIN Smith SMITH:] with Jefferies. Your line is open. [SPEAKER

[Hannah Velásquez, Senior Associate - Equity Research at Jefferies]

Hey. Good evening. This is Hannah Velasquez on for Julien. Congrats on the quarter. Maybe just to start us off, I wanted to ask about the wind repowering opportunity. It looks like last quarter, you all had cited over about two gigawatts of repowering opportunity in 2029 and 2030. But then looking at oh gosh.

[Hannah Velásquez, Senior Associate - Equity Research at Jefferies]

Slide nine, it looks like that's really come down to this 3% level. Does that imply that you've pulled that forward potentially into before 2028 such that you don't run into any issues as 2027 placed in service, comes into consideration or we await treasury guidance?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

The volume of repowering opportunities that we're advancing today is actually larger than it was one quarter ago. And the projects that we are that we've identified in today's disclosures are the same projects that we planned for completion and had indicated we might be building between now and the 2027 based on what was optimal for the projects and when they'd be ready to be repowered. So, we're advancing the same projects that we were. We're advancing them on the same schedule and are pleased to be making the progress that we are in their commercialization, noting the pretty deep level of demand for these types of resources from customers. There are actually additional wind projects in our fleet that are coming into view as potentially repowerable throughout the balance of this decade.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And those are reflected in the pipeline of opportunities that we have today. And to the extent that they become feasible, either based on tax credit qualification or their technical circumstances. And as we have with other projects, we'll look to execute them if they're financially accretive. So I think right now the repowering program is sort of executing according to plan. Our organization has done a really great job of preparing the projects technically and commercially and from a development perspective, and they look like they're going to be very financially accretive.

[Hannah Velásquez, Senior Associate - Equity Research at Jefferies]

Okay, perfect. Thank you. And then I just had a quick follow-up. So the CAFD raise for 2025, I think you mentioned during the call that that was attributed to the Catalina acquisition. But I don't believe you all had updated full year guidance for Tulumina.

[Hannah Velásquez, Senior Associate - Equity Research at Jefferies]

Is that embedded in there? Or are you all just being conservative? Or is it not contributing this year?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

It had been embedded in the high end of the original range when we had initially issued guidance for fiscal 'twenty five because the agreements for Tuolumne had been signed, though not disclosed when we initially produced that guidance. So it will contribute at the top end of that range of $440 and is online and is contributing. And as I mentioned and Sarah mentioned, we continue to target the top half of the guidance range for the year and see clearly how to achieve that.

[Hannah Velásquez, Senior Associate - Equity Research at Jefferies]

Thank you.

[Operator]

One moment for our next question. Our next question comes from Dimple Ghosse with Bank of America. Your line is open.

[Dimple Gosai, Head - U.S. Environmental, Social & Governance Research at Bank of America]

Hi, good afternoon. Thanks for taking my question. Just further to Hana's question earlier on, I understand that newbuilds offer more flexibility for safe harboring and rebowers obviously have a narrower qualifying criteria, you know, from age and depreciation status, etcetera, etcetera. So do you can you provide a megawatt perspective on how much is safe harboring or otherwise qualifies from a you know, for repowering?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

All of the projects that have been identified in our disclosures today and that we are planning to execute through the next few years to contribute to our growth goals into 2028, commenced construction and qualified for tax credits some time ago. There are some repowering projects that we might be able to execute later in the decade that could potentially be qualified through other equipment that the company has already purchased as part of its 13 gigawatt safe harbor program. The projects that really underpin the growth goals that we've increased and reaffirmed today already have commenced construction under the preexisting guidance for qualification for tax credits some time ago using conservative methods.

[Dimple Gosai, Head - U.S. Environmental, Social & Governance Research at Bank of America]

Fantastic. And a follow-up or a separate question just on the RA market. Can you comment on what percentage is still open, 27, 28? And then just anything you can talk about on pricing trends there would be super helpful.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yeah. Our 26 position is almost entirely contracted. Our 27 position is three quarters contracted approximately. And we feel good about the way that we've been managing that position. The RA market is at a place where regulators, suppliers, and customers are all engaging with each other around what kind of policy design will assure that the state has adequate reliability resources and what implications that has for how much RA of different types load serving entities need to procure, and as a result, what price they will need to pay for the supply that's available.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

We feel comfortable that the way that we have planned our goals for the future reflects a posture for marketing of our open position that is consistent with our historical practice of setting goals that we know how to meet. And embedded in our currently communicated goals for CAFD per share in 2027 and 2028 by implication of our historical CAFD per share growth rate commitment is an expectation for contracting of our open RA position at prices that are not as high as prices where we contracted last year, even despite the fact that our fundamental system view is that those RA resources have significant value into the future at a higher level than that. So we feel good about the necessity for the resources. We feel good about the way that we've planned the business. And we feel good about contracting the position at the right time at prices that are fair to the ratepayers of California and that pay Clearway Energy Inc.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

An appropriate value for those resources while we meet the goals that we've set.

[Operator]

Thank you. One moment for our next question. Our next question comes from Noah Kaye with Oppenheimer. Your line is open.

[Noah Kaye, Senior Research Analyst at Oppenheimer & Co. Inc.]

Thanks for taking the question. You know, the company is I think very, very experienced in navigating different policy regulatory changes over the years. Maybe just you talked about safe harboring. Maybe just comment a little bit on any implications or lack thereof you see from the DOI memo, the finalized FOC requirements and how it's affecting the portfolio and product development plans.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yeah, sure. Yeah, I appreciate the recognition of our history anticipating, planning, and navigating around policy changes over time, Noah. To the first question that you posed around our safe harbor strategy, as we noted previously, we safe harbored over nine gigawatts worth of resources under the Section forty five and forty eight tax credits that projects were entitled to claim had they commenced construction before 2025. The Treasury Executive Order the Treasury review in response to the executive order issued by the president after OBBB addresses changes to or an inquiry around potential changes to commence construction provisions for the technology neutral tax credits, which projects would qualify for if they commence construction this year. The further 4 gigawatts worth of safe harbor investments that Clearway Group made to commence construction on projects this year also were largely complete before July 4.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And the modest quantity of additional commencement of construction investments will have been complete before mid August when that executive order is expected. All that based on our clear legal assessment and past practice makes us feel very secure about the safe harbor strategy that we've created for about 13 gigawatts worth of projects that could potentially be built through 2029 or longer potentially. So we feel good about how we've done that. We feel good about where we stand. We feel good about what that means for the certainty with which we can hit the goals we've increased or reaffirmed today with clearly identified projects that have already commenced construction.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And I should add to that that the projects we've planned for completion through 2020 all commence construction under the old tax credits before 2025. In terms of the other questions you posed about SCIOC compliance, We have had a policy of designing and procuring for projects, mindful of the US government's goal of increasing our supply chain reliance on countries of origin that are not China. And for that reason, the equipment that we had already designed or planned before 07/04/2025 would have complied with the FIOC provisions of the statute that was ultimately enacted at the July. So we don't anticipate any disruptions to the design of the projects or the supply chain of the projects that we've planned through the next number of years. And with the suppliers that we traditionally engage with, they indicate and we have thoroughly diligence their ability to comply with FIAC requirements if they cannot do so already as we look out to 2029 and beyond.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And then finally, with respect to the Department of Interior executive order, we have respect for the considerations of all stakeholders when we develop projects. One must to be able to successfully develop complex infrastructure of the kind that we do. And we're pleased to note that the projects that we are executing that underpin all of our growth goals through 2027 already either had no nexus to federal permitting agencies or have satisfied the requirements for issuance of permits so that they can be completed. And as we look later into the decade, the quantity of projects that we have under development on federal lands are modest. Of the total pipeline you saw us note of late stage projects, only two seventy five megawatts of that is under development on federal lands.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And more broadly across the federal nexus, we feel good about our ability to continue to work with the enabling agencies in a way that's constructive and mindful of the policy goals and constraints that they face in order to develop infrastructure that's certainly necessary as we look out to 2029 and 02/1930.

[Noah Kaye, Senior Research Analyst at Oppenheimer & Co. Inc.]

Thank you, Craig. It hardly seems fair to my peers to ask a follow-up. But I'm going ask a very quick one anyway. Sarah, can I just go back to what you said during your prepared remarks? I think you said you had hedged already the full notional amount of the $850,000,000 Did I hear that correctly?

[Noah Kaye, Senior Research Analyst at Oppenheimer & Co. Inc.]

And if so, would you mind kind of sharing with us what the base rates are that are fixed?

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Yeah, we have pre hedged the $850,000,000 initial maturity. And I don't think we've disclosed a specific base rate, but it was just in line with what base rates were when we executed, which was within the last month or so. So essentially, we're just trying to lock the rates that we're at at the moment. And so eliminating the volatility risk as we move forward towards the actual refinance date.

[Noah Kaye, Senior Research Analyst at Oppenheimer & Co. Inc.]

Got it. So we've done the last month, we can figure it out from there. All right. Thank you very much.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Yeah. Yeah. No problem.

[Operator]

One moment for our next question. Our next question comes from Justin Clare with Roth Capital Partners. Your line is open.

[Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC]

Hey, good afternoon. Thanks for the questions here. So wanted to start off just on slide 13. You increased the retained CAFD expected for 2025 to 2027 a bit. Just wondering if you could walk through the increase there.

[Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC]

Is it a function of the acquisitions that were closed, additional drop downs that are anticipated? Or is there any change in the expected performance of the assets or any change in the payout ratio that you expect over the next few years here?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yeah, Mark, thanks for the question. Sarah, I think we'll have you answer the update on a line by line basis. But Mark, what we can outline in general is that we have updated our outlook on the total organic CAFD contribution from the portfolio across the three year integral that is referenced there. And the range that we've articulated incorporates the projects that, have been committed to or have been identified for potential commitment by CUN. And the contributions from those investments are incorporated into the range.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And also, the balance of the base portfolio CAFD contribution includes a snap to current expectations, like the ones that we identified in the walk where we've updated view of the cost of capital associated with refinancing of the upcoming bond maturities, the expectations for CAFD contribution from the existing thermal fleet. So we feel good about the aggregate quantity and how we would produce that. With that, Sarah, I'm glad to turn it over to you.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

Sure. Thanks, Craig. Yeah, so what we've done in terms of updating our commitments and how we fund them is essentially the commitments reflect the or the commitments and offers reflect the latest on what we've been offered. And then our sources essentially are aligned to tie back to our updated range for our twenty twenty seven CAFD per share targets. So that essentially those all align with the $2.5 to $2.7 of CAFD per share and the implied retained CAFD as well as excess debt capacity that the revised range will provide.

[Sarah Rubenstein, EVP & CFO at Clearway Energy]

So hopefully that sort of provides you with the I didn't go line by line, but I think essentially the math is done by using our updated range, which we you know, do walk through some of the movements on slide number eight, to walk through how we get to that $2.50 to $2.70. And then the math behind the sources sort of just aligns with the same set of information back to how our sources would be generated. Does that make sense?

[Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC]

Yep. Yeah. Yeah. That makes sense. And that's that's helpful.

[Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC]

So we can we can walk through that. So just to follow-up on that, though, the another part of the sources and uses that was updated was the equity issuances. So I think it was 0 to 75,000,000 previously updated to 50 to 100. So just wondering how we should think about the update there and whether you need more or less equity to get to the high end versus the low end of the targeted range. Maybe just speak to how much equity you think might be required in different scenarios.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yeah, Mark, glad to address that. So, as you'd noted, the range that we'd articulated initially for 2027 aimed to produce $2.4 to $2.6 in CAFD per share in that year. And we'd indicated that we could get to the middle end of that range without the need to issue equity at all. That continues to be true. The accumulation of growth commitments that we've now announced or projects that are now online, some to CAFD per share contribution that's just above the original midpoint of $2.50 CAFD per share in 2027.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

So we've now cast our sights towards reaching the midpoint or better of the new 2.5 to 2.7 range. And as we look at what capital is required to achieve that range and what projects we would add in order to reach it, the projects that we've identified for dropdown or repowering through 2027 in today's call would take you to the midpoint of that range approximately and then would start to require capital in that range of 50,000,000 to $100,000,000 worth of equity issuance. And then as we go towards the higher end of that range, or we look at what we think is optimal between the range of 5% to 8% CAFD per share growth that we'd outlined as our goal in 2028 and 2029, that's what takes you to the higher end of that range. As Sarah noted, and we've talked through in a succession of recent calls, we aim to capitalize that growth through traditional and predictable mechanisms consistent with those used in the listed infrastructure space and for leading growth mid cap utilities. And that's how we plan to capitalize the core goals that we've articulated today.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

So I think we feel quite good about how we've executed on the plan that we've articulated to our investors and the way that we're able to grow at a pretty compelling way we go into the 2027 and beyond with relatively modest amounts of equity issuances. Is that responsive to your question?

[Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC]

Yes. No, that's helpful. So I appreciate it. Thank you.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

You bet. Thank you, Mark.

[Operator]

One moment for our next question. Our next question comes from Mark Jarvi with CIBC. Your line is open.

[Mark Jarvi, Equity Research Analyst at CIBC Capital Markets]

Yeah. Thanks, everyone. Just turning to slide nine again. Just in terms of as you look out to 2930 and through to '32, you show sort of the build of storage becoming a bigger component of the advanced pipeline and that could fulfill the growth alone at for C1. Is that the message there on that slide that people are concerned about solar and wind economics beyond the tax credit expiry that batteries can fill that in?

[Mark Jarvi, Equity Research Analyst at CIBC Capital Markets]

And I guess just how conversations gone around origination on battery contracts given the evolution of tariffs and tax credits in the last couple of months?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yes, that's certainly one interpretation of the chart. I think we feel good many of the projects that make up those bars and their competitiveness and also qualification for tax credits. But certainly, of the advantages that Clearway Group and Clearway Inc, being sponsored by Clearway Group enjoy is that we've built a really excellent franchise developing and operating battery projects. And those projects continue to be eligible to receive tax credits well into the next decade. And the projects that we've planned in 'twenty nine, in 02/1930, and into the early years of the next decade all have very advantageous locations and interconnection queue positions in markets where the ability to deliver capacity really determines whether a project is commercially valuable and executable.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

So our finding has been that in the core markets where most of our battery development is occurring, we can build and profitably commercialize everything we can interconnect. And that continues to be true today in today's tariff environment and with the requirement to be able to source batteries from companies that can satisfy the requirements of foreign entity of concern provisions in the most recent statute. So we feel good about that. Our ability to continue to equitably share risk around tariff or supply chain disruption with customers throughout the West where we can sign long term contracts has continued to prove out here over a number of monthly cycles of change this year. And what I'd add is we love these resources in our fleet.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

We're into our second full year of operating gigawatt scale battery resources. And they're running routinely 98.5%, 99% availability above what we underwrote, and they respond in the way that we need them to and that our customers do. So we're really pleased that this is an asset class, is a low resource volatility asset that will continue to grow in its share of CUN's fleet and with contracts that are routinely fifteen and twenty year contracts and very compatible with this business model.

[Mark Jarvi, Equity Research Analyst at CIBC Capital Markets]

That's great to hear. And then maybe a couple of quarters ago, you talked about the opportunity with data center customers, both behind the meter and grid connected and talking about multi technology solutions. How have those evolved? How have that customer base working into your advanced pipeline at this point? Are those progressing well?

[Mark Jarvi, Equity Research Analyst at CIBC Capital Markets]

Are they becoming complicated to transact? Or just sort of update some of what you shared at the Q4 update?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Yes. Yes, those dialogues continue. You can see in some of the contracting customers that we've announced for some of our recent wind repowerings that we've started to build mutually fruitful relationships with multiple major data center hyperscaler companies. And we find that these relationships now exhibit a level of balance that allows us to contract and create projects that are compatible with the C1 investment mandate and that also meet the needs of those customers. And we have found that as we move from one project to another, there's a virtuous cycle that we're executing a repeat business with each of them.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

So it would be reasonable to expect that some of the origination activity that you see referenced on our appendix slide of awards or shortlisted opportunities continues to be with those types of data center customers, and not only for repowering projects, but also for other resource types and in multiple geographies. As to bigger data center complexes, we do have dialogue ongoing principally for co located resources that would allow customers like that to come to load serving entities with a request for additional load service that is accompanied by generation supply that allows for their load to be integrated into the grid, while assuring that there's adequate capacity and energy to serve it and avoid disrupting the value proposition for the rest of the customer base for those load serving entities. And in some instances, also with a mixture of partly behind the meter resources. And as we noted before, we want to be deliberate about more specifically communicating about our plans for complexes of that nature until we feel that they have matured enough to be as certain as the other types of things that we communicate to you in calls like these. But as and when we reach that point and it becomes more certain that they will play a role in the future growth of CUN, you can certainly expect to hear more from us.

[Mark Jarvi, Equity Research Analyst at CIBC Capital Markets]

Sounds good. Thanks, Craig.

[Operator]

One moment for our next question. Our next question comes from Steve Fleishman with Wolfe Research. Your line is open.

[Steve Fleishman, MD & Senior Analyst at Wolfe Research LLC]

Yeah. Hi. Actually, Craig, all my questions were answered. So I'm all good. I'll let the people end early.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Okay.

[Operator]

One moment for our next question. Our next question comes from Corinne Blanchard with Deutsche Bank. Your line is open.

[Mike McNulty, Equity Research Associate at Deutsche Bank]

Hey, good evening. This is actually Mike Filthy on for Corinne. Congrats on the guidance range and or guidance rate, and thanks for taking my question. My first first question is with the goat mountain. You mentioned you signed a PPA with a hyperscaler.

[Mike McNulty, Equity Research Associate at Deutsche Bank]

Can you just talk about how these PPA terms differ from those of more traditional PPA counterparts?

[Craig Cornelius, CEO, President & Director at Clearway Energy]

What we find today is that, really with all customers, whether it's a hyperscaler or a sophisticated regulated utility that understands project risk. The relationship between a project seller and a buyer is a balanced and fair one, where the scarcity value of a project that has a permit, that can be interconnected, that has a viable supply chain, and a sponsor that is able to capitalize and build it is significant. And that means that when signing PPAs, we can account for risks like the potential changes in costs attributable to tariffs, or variations in the tax credit that the project's ultimately able to claim, or variations in differences between the price of power at the node where the power injects in some hub, all can be accounted for in a way that is fair and allows us to be confident that the return we need to generate for CWEN as a permanent investor and the return that we need to generate for Clearway Group as a sponsor can be satisfied while also still delivering a value proposition to the customer that motivates them to sign a PPA. So in that PPA, we feel good that that right balance has been struck and allows Goat Mountain to be executed across a broad range of foreseeable scenarios.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

And in the other PPAs that we've signed so far this year, we have similarly accounted for risks like that. And it's part of what makes us confident that the projects we've planned and identified can be executed successfully and contribute to CWENS CAFD in the years ahead.

[Mike McNulty, Equity Research Associate at Deutsche Bank]

Great. Thank you so much. Appreciate it.

[Operator]

Ladies and gentlemen, this does conclude the Q and A portion of today's conference. I'd like to turn the call back over to Craig.

[Craig Cornelius, CEO, President & Director at Clearway Energy]

Thank you, everyone, for joining us today and for your ongoing support of Clearway. We really look forward to continuing to deliver with the excellence you've seen from us this year and the quarters ahead as we strive to set the gold standard for America's power sector and reliability, growth and competitiveness for the long run. Operator, you can close the call.

[Operator]

Thank you. Ladies and gentlemen, does conclude today's presentation. You may now disconnect, and have a wonderful day.

Participants

Executives

• Akil Marsh, Director - IR
• Craig Cornelius, CEO, President & Director
• Sarah Rubenstein, EVP & CFO

Analysts

• Hannah Velásquez, Senior Associate - Equity Research at Jefferies
• Dimple Gosai, Head - U.S. Environmental, Social & Governance Research at Bank of America
• Noah Kaye, Senior Research Analyst at Oppenheimer & Co. Inc.
• Justin Clare, MD & Senior Research Analyst at Roth Capital Partners, LLC
• Mark Jarvi, Equity Research Analyst at CIBC Capital Markets
• Steve Fleishman, MD & Senior Analyst at Wolfe Research LLC
• Mike McNulty, Equity Research Associate at Deutsche Bank