Northland Power Q4 2025 Earnings Report

Northland Power EPS Results

• Actual EPS: C$0.93
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Northland Power Revenue Results

• Actual Revenue: $725.26 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Northland Power Announcement Details

• Quarter: Q4 2025
• Date: 2/26/2026
• Time: After Market Closes
• Conference Call Date: Thursday, February 26, 2026
• Conference Call Time: 10:00AM ET

Northland Power (TSE:NPI) develops, constructs, and operates maintainable infrastructure assets across a range of clean and green technologies, such as wind (offshore and onshore), solar, and supplying energy through a regulated utility. Offshore wind is expected to remain the company's largest segment over the long term. Northland's growth opportunities are global and span North America, Europe, Latin America, and Asia.

Northland Power Q4 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Q4 operational performance beat expectations with 96% availability, record German offshore wind generation and Adjusted EBITDA of CAD 390 million (up 25% YoY), and Free Cash Flow per share of CAD 0.46 versus CAD 0.31 a year earlier.
• Negative Sentiment: Full-year results showed Adjusted EBITDA of CAD 1.25 billion (in line with 2024) but a weaker cash profile: Free Cash Flow per share fell to CAD 1.46 and the company recorded a CAD 108 million net loss driven by a non‑cash impairment (North Sea One).
• Negative Sentiment: Construction execution risk at Hai Long remains material: turbine commissioning has been slower due to weather, and management warns of a potential CAD 150–200 million shortfall in pre‑completion revenues/equity injections, with funding options and a mid‑year update pending.
• Neutral Sentiment: 2026 guidance targets a ~25% increase in Adjusted EBITDA to CAD 1.45–1.65 billion (driven by Hai Long, Baltic Power, Oneida and Jurassic BESS) but forecasts lower Free Cash Flow per share of CAD 1.05–1.25 due to one‑time 2025 items, hedging and higher debt service.
• Positive Sentiment: Strategically, Northland aims to double gross operating capacity to 7 GW by 2030, pursue CAD 50 million in annual cost savings by 2028, centralize development for disciplined capital allocation, and is expanding its European battery and offshore footprint (notably Poland).

Presentation

[Operator]

Welcome to the Northland Power Conference Call to discuss the fourth quarter and year-end 2025 results. As a reminder, this conference is being recorded on Thursday, February 26th, 2026, at 10:00 A.M. Eastern. Present for this call are Christine Healy, President and CEO, Jeff Hart, Chief Financial Officer, and Adam Beaumont, Senior Vice President of Capital Markets. Before we begin, Northland's management has asked me to remind listeners that all figures presented during today's call are in Canadian dollars, and to caution that certain information presented and responses to questions may contain forward-looking statements that include assumptions and are subject to various risks. Actual results may differ materially from management's expected or forecasted results. Please read the forward-looking statement section in yesterday's news release announcing Northland Power's results, and be guided by its contents when making investment decisions or recommendations. The release is available at www.northlandpower.com.

[Operator]

I will now turn the call over to Ms. Christine Healy. Please go ahead.

[Christine Healy, President and CEO at Northland Power]

Good morning, everyone. Thank you for joining us. I'll begin with an overview of our strategic priorities and an update on our two large construction projects. Jeff will then provide a review of our fourth quarter and full year financial results, as well as our 2026 guidance. Following our prepared remarks, we will open the line for your questions. In 2025, we made progress across our operational, financial, and organizational priorities. We expanded and reinforced our leadership team with the addition of new executive members. We introduced a new global strategy outlining our growth priorities, a five-year funding plan, and how we will create long-term value for shareholders. We advanced our construction projects, completing key milestones at our two offshore wind projects, Hai Long in Taiwan and Baltic Power in Poland.

[Christine Healy, President and CEO at Northland Power]

Following the successful completion of Oneida last year, we are advancing our second battery storage project in Alberta, Canada, called Jurassic BESS. Executing these projects is our primary focus through 2026, and together they will add 2.2 GW of capacity by 2027. We delivered on our financial commitments, achieving our Adjusted EBITDA guidance and outperforming on Free Cash Flow per share. Our performance in the fourth quarter was supported by 96% operating availability and record high generation from our German offshore wind assets. Before we move into the strategy, I want to take a moment and emphasize that our performance is underpinned by our commitment to our people. As I've talked about before, health and safety are core values for Northland. In 2025, we reinforced this commitment with the launch of our twelve Golden Safety Rules.

[Christine Healy, President and CEO at Northland Power]

These rules are non-negotiable and ensure that our standards are consistently understood, respected, and applied across all work environments. A safe workplace is the prerequisite for the work we do. Building on that foundation, we are advancing a strategy focused on disciplined growth and long-term value creation. We're at an inflection point in electricity markets. After decades of flat electricity demand, we're entering a period of rising demand that some call a power super cycle. It's driven by electrification, industrial growth, population growth, urbanization, and a rise in AI demand. As power generators, our strategy plans to capture this momentum and double our gross operating capacity to 7 gigawatts by 2030. This is not just about scale, it's about focus and finding the right high-quality projects that add real value to our business.

[Christine Healy, President and CEO at Northland Power]

Our focus on achieving specific Free Cash Flow targets by 2030 is more than a goal. It is the lens through which we evaluate every capital allocation decision we make. To strengthen our 2030 goals, we're focused on three pillars: deliver, strengthen, and grow. The deliver pillar of our strategy is focused on operational performance and successfully bringing 2.2 GW of projects under construction into operation. Our track record of executing and delivering large-scale projects is one of the things that sets Northland apart. The strengthen pillar is about building a foundation for scale, including our target of CAD 50 million in annual cost savings by 2028.

[Christine Healy, President and CEO at Northland Power]

To support this, we have already transitioned to a regionally focused operating model, split into the Americas and International Business Units, designed to build scalable platforms in our core markets and capture operational leverage by clustering assets in those core markets. This structure streamlines how we operate, enhances local accountability, and maintains global standards. At the same time, we have centralized all of our development activities into one global organization. This ensures that every project, regardless of technology or geography, competes for capital on a consistent basis, so only the most value accretive projects move forward. Finally, under the grow pillar, we continue to high-grade our pipeline, advancing new capacity to supplement our current construction. An example of this is the two recently acquired late-stage battery storage projects in Poland. This acquisition, alongside Baltic Power, demonstrates our strategy of clustering high-value assets in a core European market.

[Christine Healy, President and CEO at Northland Power]

Our approach is technology-agnostic, focusing on our core markets where fundamentals are strongest. Our plans for Europe are driven by an ongoing and increasing need for energy security. I recently attended the North Sea Summit, which took place in January, where 9 European governments reaffirmed their commitment to expand offshore wind in the North Sea through a coordinated regional approach, including up to 100 gigawatts of projects by 2050, with an interim target of 20 gigawatts for the 2030s. This North Sea Summit outturn is a consistent theme we see across Europe, a commitment to build out of renewables for decades to come, offshore, onshore, and battery storage. For developers like Northland, this provides important long-term demand visibility. Greater policy alignment and infrastructure coordination should help reduce development friction, improve permitting timelines, support enhancements to the supply chain, and ultimately enhance capital efficiency.

[Christine Healy, President and CEO at Northland Power]

Europe continues to show conviction that offshore wind will play a critical role in meeting the region's energy demand and advancing the clean energy transition, strengthening energy security, improving affordability, and supporting industrial competitiveness. In Canada, electrification and industrial growth are accelerating the need for new supply. Canada continues to be a growth market for us, with every province forecasting power demand growth. We see opportunities in several of our technologies, including gas-fired generation and battery storage. To capitalize on this opportunity, our five-year growth and funding plan has been set with the right foundation, supported by an investment-grade balance sheet. We've increased our project return thresholds to a minimum of 12%, demonstrating that we will invest only in the most value accretive opportunities. We are focused on advancing the opportunities where we can apply our global expertise to local execution.

[Christine Healy, President and CEO at Northland Power]

I'll turn now to more specific details on construction progress. At Hai Long, we've reached several major milestones, including the installation of all 73 foundations, all four export cables, and both offshore substations. To date, we have successfully installed 37 turbines. 20 of those turbines are now actively generating power. The project team has been working hard over the winter to optimize our schedule and have had a crew on standby to continue commissioning when weather permits. As we've discussed in previous calls, offshore Taiwan, we work with a weather window, so full in-water activities will resume in earnest later in April when that weather window reopens. The project is on track for commercial operation in 2027.

[Christine Healy, President and CEO at Northland Power]

At the Baltic Power Offshore Wind Project in Poland, we achieved 2 key milestones this quarter with the completion of all monopile foundations, and the completion of grid interconnection works by the local utility. We also completed the installation of both offshore substations, 2 of 4 export cables, and 30 of the project's 76 wind turbines. The project is on track for commercial operation in the second half of 2026. We're also making strides in our battery storage portfolio. At Jurassic BESS in Alberta, foundations have been installed, and the battery packs have arrived in Canada. The project is on track for commercial operation in 2026. Looking ahead, our priorities are clear: deliver our construction projects, optimize the value of our operating portfolio, and advance and high-grade our development pipeline. The recent acquisition of 2 late-stage battery storage projects in Poland adds scale to our European platform.

[Christine Healy, President and CEO at Northland Power]

We continue to advance both projects, having signed their battery supply agreements. We're currently finalizing other procurement activities ahead of financing and the start of construction expected later this year. Building on our expertise and experience from the Oneida project in Ontario, we continue to see opportunities to expand our battery storage portfolio. We are actively evaluating several projects. In November, we completed the required performance test for a 23 MW capacity upgrade at our Thorold natural gas-fired facility in Ontario. Officially secured a 5-year contract extension through 2035. These are all examples which underscore the progress underway across Northland. Our disciplined approach to capital deployment, project execution, and excellence in operations delivers energy for our markets and value for our shareholders. I'll now turn it over to Jeff to walk us through the financial results.

[Jeff Hart, CFO at Northland Power]

Thank you, and good morning, everyone. As Christine noted, we achieved our 2025 Adjusted EBITDA guidance and exceeded Free Cash Flow guidance. Strong winds at our offshore assets in Q4 and lower curtailment from grid outages resulted in higher than budgeted production and a 21% overage from the same quarter of last year. Our high operating availability of 96% allowed us to capture that benefit. The quarter also benefited from contributions from the Oneida Energy Storage Project that commenced operations in May of last year, as well as increased market demand for dispatchable power at our natural gas facilities as a result of cold weather and third-party facility outages in Ontario. Adjusted EBITDA in the quarter was CAD 390 million, a 25% increase compared to the fourth quarter of 2024.

[Jeff Hart, CFO at Northland Power]

This increase was primarily due to higher production from offshore wind, contributions from Oneida, and increased market demand at our natural gas facilities. Net income for the quarter was CAD 290 million, compared to CAD 150 million in 2024. Free Cash Flow per share for the fourth quarter was CAD 0.46, compared with CAD 0.31 in 2024. Turning to the full year, Adjusted EBITDA for the full year was CAD 1.25 billion, in line with 2024, as lower offshore wind resource in the first half of this year offset contributions from Oneida and strong performance at our America's onshore wind assets. Free Cash Flow per share for the full year decreased to CAD 1.46 from CAD 1.53 in 2024.

[Jeff Hart, CFO at Northland Power]

The year-over-year decrease was mainly due to higher scheduled debt repayments, lower offshore wind resource, and the non-recurrence of certain one-time items, partially offset by contributions from new assets and lower current taxes. For the full year, Northland recorded a net loss of CAD 108 million, compared to net income of CAD 371 million for the full year of 2024. This reduction is primarily due to a non-cash impairment for Nordsee One, recorded in the third quarter of 2025. We continue to advance our major construction projects. As at December 31st, Hai Long and Baltic Power have less than CAD 4 billion of capital expenditures remaining to be incurred. Overall, both construction projects are continuing on track for commercial operations, with overall costs aligned with original expectations.

[Jeff Hart, CFO at Northland Power]

As reported last quarter, Hai Long turbine commissioning has been slower than expected, it could impact pre-completion revenues and equity injections in the amount of CAD 150 million-CAD 200 million Northland share. The shortfall in pre-completion revenues outlined above can be funded by several sources, including liquidity, corporate liquidity. We and our project partners are actively looking at optimizations at the project level to provide funding, and we'll provide an update on this by midyear. Turning to our 2026 financial guidance. We expect 2026 Adjusted EBITDA to be in the range of CAD 1.45 billion-CAD 1.65 billion, an increase of approximately 25% from the CAD 1.25 billion delivered in 2025.

[Jeff Hart, CFO at Northland Power]

The key drivers of this increase will be contributions from Hai Long and Baltic Power, as well as full-year contributions from Oneida and the commencement of operations at the Jurassic BESS project in Alberta. These increases will be partially offset by lower contributions from Nordsee One, following a scheduled step down in the feed-in tariff mechanism. We expect 2026 Free Cash Flow to be in the range of CAD 1.05-CAD 1.25 per share, compared to CAD 1.46 per share in 2025. The year-over-year decrease is due to several one-time items totaling CAD 0.22, which benefited 2025, including a German tax refund, deferral of Spanish debt repayments, and other items.

[Jeff Hart, CFO at Northland Power]

This decrease is also attributable to ongoing foreign exchange hedging costs, higher debt service for the natural gas assets, and the cessation of capitalized interest on our hybrid debt as we enter operations in Baltic Power. Partially offsetting this decrease is the additional contribution from Baltic Power, representing approximately $0.20 per share. For 2026, we assume development expenditures of approximately $50 million. This will be focused on selective opportunities in our core markets of Europe and Canada. Turning to our balance sheet. With more than $900 million of available liquidity and our investment-grade credit rating, we are well positioned to execute on a disciplined capital allocation plan. With that, I'll hand it back to Christine.

[Christine Healy, President and CEO at Northland Power]

Thank you, Jeff. We are focused on delivering the strategy we set out in the fall and advancing the new projects that will add value and double our capacity by 2030. We look forward to updating you on our progress. That concludes our prepared remarks. Operator, can you please open the line for questions?

[Operator]

Thank you. To ask a question, please press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. Please stand by while we compile the Q&A roster. Our first question comes from Baltej Sidhu of National Bank of Canada. Your line is open.

[Baltej Sidhu, Vice President, Equity Research Analyst at National Bank Financial]

Thank you, and good morning, everyone. Your 2026 guidance is comfortably above consensus. Just reflecting on last year's weak wind resource in the first half, and acknowledging the incremental diversification from projects like Hai Long and Baltic, could you shed any light on the downside protection that's embedded in your outlook and how you approached risk in your assumptions to the P50 production forecast?

[Jeff Hart, CFO at Northland Power]

I can take that, good morning, then Christine can add on. Look, we've been consistent with how we outlook on the wind resource. It's consistent with long-term averages. We continue to forecast based on that, off of our operated, our current operated facilities. I think you can see this year, you know, Q1 and Q4, as we've always talked about, are always the heavy wind periods. We did have lower wind in 2025 in the first half, and particularly kind of through Q1. We captured a good chunk of that back in Q4 with record pace. Look, I think where we look at this is the long-term average, and the P50 is the right spot to be.

[Jeff Hart, CFO at Northland Power]

We'll have, you know, some variability and volatility in that, but we continue to not deviate from that, and I think we're comfortable with where we sit on that. Then the other piece, when you look at it on guidance, is obviously there's a big piece on execution on the construction projects and the EBITDA contribution between Hai Long and Baltic. You know, I think for us, as you can see and where we've been in Hai Long, we did have the weather window here, and as we talked about, I think at Investor Day in the quarter, we had a cup last quarter. Only about two turbines running at the start of that weather window.

[Jeff Hart, CFO at Northland Power]

We felt it wasn't prudent to assume that we could get out there depending on weather, and we're currently in and around 20, which I think is better than what we expected coming out of the weather window. We're still managing, and you can see with the assumption around our equity injection or potential equity injection, we're evaluating things at the project level. I think we're being prudent on our cash resources to make sure we've got funding mechanisms for it. As far as Baltic Power goes, is I think we've seen good execution, but we, you know, I never say comfortable. The big thing I want to leave with you is this execution on these construction projects, and that's the biggest thing that we've got to be on top of this year.

[Jeff Hart, CFO at Northland Power]

The wind will blow on the operating assets, and we'll leave it at a P50.

[Christine Healy, President and CEO at Northland Power]

I guess I can add a bit more color to that. Thanks for your question, Baltej. I think maybe, not showing up so much in the numbers is the fact that this winter has actually been a very tough weather window at Hai Long, and getting offshore has been challenging. I think we were right to be conservative in our approach to that. The weather window should reopen in April. We're ready to go with that. We still have a lot to go in the project. I think it's wise to be prudent in how we approach what we expect to happen through the rest of the year. At Baltic Power, we've seen that there's actually been very good in-weather performance in the last in-water performance in the last few weeks.

[Christine Healy, President and CEO at Northland Power]

Probably not everybody is staying up-to-date on weather trends in the Baltic Sea, but it's also been, very, very cold, which does affect, you know, the operational tempo. I think we've been prudent in our approach this year to, understand what could happen with the projects, and our, our guidance reflects that.

[Baltej Sidhu, Vice President, Equity Research Analyst at National Bank Financial]

Thanks. That's great color. Just to leverage some of the elements that you both alluded to, you know, you have a bit more than half of the turbines you initially had expected to be energized at Hai Long, and there's been a good amount of progress since the capital markets day, as you alluded to in your prepared remarks. Could you provide any details on how the recovery plan is progressing from here? What feedback or visibility are you receiving from Siemens regarding execution and full path to completion?

[Christine Healy, President and CEO at Northland Power]

Obviously, it's very much on our minds, and we're extremely focused on it, both at the project level and also here at Northland. I'm in regular contact with Siemens. We have a regular dialogue sort of zippered up at, you know, in both organizations. I think all of this is. You know, Siemens is very committed to getting the work done and getting the work done, as efficiently and effectively as possible. Now it's all about preparation because you know, with the weather window currently closed, it actually gives us a bit of time to make sure that the planning is right, and that we've got the people and the expertise and the vessels to be able to launch when the weather window reopens.

[Christine Healy, President and CEO at Northland Power]

Very high focus on that, and, you know, I would say the dialogue continues on a pretty regular basis with Siemens.

[Baltej Sidhu, Vice President, Equity Research Analyst at National Bank Financial]

Excellent. Just switching gears to the MFW Baltyk, as these projects are already contracted, what key milestones or execution risks need to be mitigated to get these across the line to reach FID?

[Christine Healy, President and CEO at Northland Power]

There's a few things going on right now, Baltej, and that's, you know, we have local teams on the ground in Poland. While the projects are in, you know, we're really happy with the projects. We've, as I mentioned in my comments, you know, we've secured the supply for the batteries. At the same time, we do have to make sure that we have all the local permits, that the local authorities are getting that we have a good relationship there, that they know what we're doing, that there's clear understanding of that. Normal, I would say, regulatory process, which, you know, the team is working through. The intent would be that that would come forward internally for our final investment decision mid-year.

[Jeff Hart, CFO at Northland Power]

Yeah.

[Christine Healy, President and CEO at Northland Power]

Execute on that project and to sound like a Newfoundlander, get her done.

[Jeff Hart, CFO at Northland Power]

Yeah. Yeah. Just to further, like, as Christine talked to, is, you know, we secured obviously battery supply. The big thing outside of the permitting and the lowest pieces in the mid-year is obviously working through the funding arrangement and project financing levers. We're, you know, working that, and I think we'll be progressed, and there's no roads, you know, roadblocks right now, and we'd expect to be through that by kind of around mid-year, as Christine talked about. Those are the avenues that we're working.

[Baltej Sidhu, Vice President, Equity Research Analyst at National Bank Financial]

Perfect. Thank you. I'll get back in the queue. Thank you.

[Operator]

Thank you. Our next question comes from Mark Jarvi of CIBC. Your line is open.

[Mark Jarvi, Equity Research Analyst at CIBC]

Yeah, thanks. Good morning, everyone. I just wanted to follow up on a few things on Hai Long.

[Jeff Hart, CFO at Northland Power]

Yeah.

[Mark Jarvi, Equity Research Analyst at CIBC]

One would be: Can you continue to commission energized turbines before the weather window opens? Can you get past the 20 that are currently selling into the grid now?

[Christine Healy, President and CEO at Northland Power]

Basically, Mark, the way it works right now is we do the look-ahead forecast, and if there's a window of a couple of days that we can get people out there safely to do the work, then we do it. There is a team on standby all the time, and we make the plan based on the weather forecast, and that's updated daily. Certainly the main update is weekly, but we also then adjust that daily. If there is an opportunity to get out there, then the teams get out there.

[Mark Jarvi, Equity Research Analyst at CIBC]

Got it. Jeff, you mentioned that getting to 20 at this point is a little bit ahead of expectations, yet you still have the foregone PCRs at CAD 150 million-CAD 200 million.

[Jeff Hart, CFO at Northland Power]

Yeah.

[Mark Jarvi, Equity Research Analyst at CIBC]

What has to happen for you to guys hit CAD 150-CAD 200 now? Like, or are you tracking below that at this point?

[Jeff Hart, CFO at Northland Power]

I think there's a number of factors embedded in here. If you don't mind, I'll kind of go through broadly the whole pre-completion revenue and then corresponding funding requirements, because I think there's a bunch of factors in there. It's not only revenue generation, it's cash collection, and then how that times with our construction progress. You're absolutely right. Like, obviously, you know, and you asked the question on the weather window here for the next month or so. Look, we don't really plan that we'll get a big amount of work as the weather will be what it'll be, but we did get 20 done or 18 done from the 2 to 20, and that number will vary a little bit as we work through the issues with the turbines. That was good performance.

[Jeff Hart, CFO at Northland Power]

I think where we look to longer term to hit where we need to be is, we need materially on the next weather window in early October, effectively, all the turbines spinning at that point in time. That's where, as we've always talked about, Q1 and Q4, pretty much is the heavy weather window, and so that's where you see a significant amount of generation. I'll say generation, because that's obviously more of the back end of the year, and there's cash collection time frame, let's call it 60 days or so, or whatever it is, that would put the cash collection more into the cash receipt, more into the new year, but we would have generated.

[Jeff Hart, CFO at Northland Power]

The reason that's important is when we look at this, is obviously when we come out of the weather window on construction, we'll be heavy into execution here on the actual project itself again. Clearly, when you look at the back-end-weighted nature of the PCR generation, the execution being more, I'll call it, front-end loaded or, you know, kind of through Q2 and Q3, we have some funding requirements because that revenue will come in after and be collected, you know, more into the new year. We're still looking at is making, we'd have to potentially fund with the change in shape here, potential equity injection of that kind of CAD 150 million-CAD 200 million that we've talked about.

[Jeff Hart, CFO at Northland Power]

As I said, we're looking for different avenues to maybe fund that within the project with partners and look at different avenues with that, and I'd expect an update by midyear on that, Mark.

[Mark Jarvi, Equity Research Analyst at CIBC]

Okay. Just to get that clear, PCR is kind of more like cash flows, that you're just not catching up because there's a bit of a lag in payment versus-

[Jeff Hart, CFO at Northland Power]

Yeah.

[Mark Jarvi, Equity Research Analyst at CIBC]

The EBITDA. Yeah.

[Jeff Hart, CFO at Northland Power]

100%. There's two things. The EBITDA is more back-end weighted, number one. Number two, that back-end weighted EBITDA. In any business, there's always a lag between revenue generated and cash collection and payment terms, we have to work through that. Because it's back-end weighted, and you've got, you know, you have collection thereafter in normal course, we have execution here before, you know, Q4, there is some construction pieces that we do have to fund, and then we're looking at different avenues in that funding. Is there something we can do at the project level, so we, you know, maybe don't have to equity inject corporately, here around mid-year? That's one of the big pieces we're working through.

[Jeff Hart, CFO at Northland Power]

Think of it this way, back-ended earnings, in generation, and then you've got time frame on collection.

[Mark Jarvi, Equity Research Analyst at CIBC]

Got it. Then, Christine, you brought up the North Sea Summit, and there's the investment pact that's come out of that. Outside of Poland, are there any other areas that you guys are increasingly focused on in Europe and the North Sea? Is there anything in terms of partnerships that are starting to sort of pick up steam?

[Christine Healy, President and CEO at Northland Power]

Thanks for the question, Mark. I would say, to be clear, Poland is not, they're in the Baltic as opposed to the North Sea.

[Mark Jarvi, Equity Research Analyst at CIBC]

Right.

[Christine Healy, President and CEO at Northland Power]

We see both areas as being of interest. You know, Poland continues to be of high interest for us. We're really, I mean, we're happy with our partnership with ORLEN. We're happy with the Baltic Power project. We continue to have a high interest in doing more in Poland. In the North Sea, we've been there for quite a long time. I would consider it a very sort of it's a home for Northland in many ways. You know, with our work that's been ongoing for more than a decade in Germany and the Netherlands, we do have a project in development in the U.K.

[Christine Healy, President and CEO at Northland Power]

We're having lots of dialogue with other companies and with governments about opportunities, and we see an opportunity-rich environment for Northland. Now it's a question of making sure that we're disciplined, and we pick only the very best opportunities that we want to deploy our people onto. That I would say we're pretty selective, but we see some good opportunities in front of us there.

[Mark Jarvi, Equity Research Analyst at CIBC]

Have those, the range of opportunities, the quality opportunities, improved or changed in the last couple of months?

[Christine Healy, President and CEO at Northland Power]

I think we've seen now that some of the recent, the recent auctions that have happened, we see better economics for projects. As a result, that makes for a better environment for us. For me, I do think it's a good reflection of capital discipline across the sector, that we need to make sure that the projects that we do in the future deliver the rates of return that are going to lead to success for investors as well as success for the host markets.

[Mark Jarvi, Equity Research Analyst at CIBC]

Understood. Okay, thanks for the time, this one.

[Operator]

Thank you. Our next question comes from Nelson Ng of RBC Capital Markets. Your line is open.

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

Great, thanks. Good morning, everyone. My first question just relates to the Polish battery storage project. Regarding the 17-year capacity contract, roughly how much of your total expected revenue does that cover?

[Jeff Hart, CFO at Northland Power]

No, I think, you know, we'll provide further details as we go in with the economics here and when we come to final investment decision or financial close, however you want to word it. What I would say is it's going to be a mix of merchant and capacity. Look, I'm not getting into specific percentage at this point, but it's not going to be disproportionate capacity. It'll be far more balanced and between the merchant exposure and ancillary services and potential capacity payments, which is inflation-indexed.

[Christine Healy, President and CEO at Northland Power]

Nelson, if it's helpful to you, it's a similar model to what we see applied in Oneida.

[Jeff Hart, CFO at Northland Power]

What I would say is.

[Christine Healy, President and CEO at Northland Power]

The percentages will be slightly different as they are jurisdiction to jurisdiction, but the sort of structure of it is, you know, similar to Oneida.

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

Okay, got it. Jeff, a question for you.

[Jeff Hart, CFO at Northland Power]

Yep.

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

For your three European offshore wind projects, do you pre-finance those, refinance the debt or reduce the credit spread relatively quickly in terms of, like, when you're nearing construction completion? Like, I presume discussions have started with Baltic Power and Hai Long with lenders, or can you just comment on whether there's been discussions that have started in terms of whether it's refinancing or refinancing or having kind of discussions about the credit spread now that you see construction risk declining? I know you talked about looking at.

[Jeff Hart, CFO at Northland Power]

Yep

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

other options in terms of the capital injection for Hai Long, but can you just give a bit more color on the overall process?

[Jeff Hart, CFO at Northland Power]

Yeah, no, 100%. You're right, and typically, as we're approaching COD, and you could look maybe too, is just when is the right time? Is it right at or a little bit after? That's something that's on our mind, and it's on the deliverables for the team to look at how we drive optimization. Number one, with Hai Long, I think there's just some market factors there. We see that we could potentially get earlier than COD on some potential mechanisms, but we'll look at that, and I'll provide an update midyear on it. Baltic Power, yeah, we're looking at different options and avenues as we approach COD, but we'll be a little bit flexible on that.

[Jeff Hart, CFO at Northland Power]

It'll be, you know, market dependent, and you're right, it will typically coincide as we get to COD, but we may see windows before or a little bit after that, depending on the market. It is something that we are, we are looking at for sure.

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

Okay, got it. There's one last question. The Polish battery project, that's EUR 200 million. I think that's roughly CAD 320 million. If I do the math on Jurassic BESS versus the Polish project, I think Jurassic is about, like, 750,000 per MWh. The Polish project is about 270,000 per MWh, so that's, like, over 60% lower cost. Like, obviously, there's scale, and there's probably geography in terms of labor, but can you just talk about the large price, like, cost difference between the Polish project versus the Alberta project?

[Christine Healy, President and CEO at Northland Power]

Thanks, Nelson. I think it's a great question because it really shines a light on what happens when we're early in the curve on a technology. For grid-scale battery storage, like these BESS projects, we have seen a real shift in battery pricing, which is one of the big deltas on how the overall cost of these projects. You're right, that's probably the biggest moving piece, is the cost of the batteries, which is coming, it continues to come down, and we've seen a drop in that over time. The other piece, though, I would be remiss if I didn't highlight, is the permitting approach. The permitting approach that we see applying in Poland is a quicker process than we see in most jurisdictions in Canada.

[Christine Healy, President and CEO at Northland Power]

When we do our project planning, we build that in based on what the permitting process is gonna be, jurisdiction to jurisdiction. As you've maybe heard me say too many times, the time it takes to get things permitted really matters. Time is money in projects.

[Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets]

Great. Thanks, Christine. I'll leave it there.

[Operator]

Thank you. Our next question comes from Sean Steuart of TD Cowen. Your line is open.

[Sean Steuart, Managing Director, Equity Research at TD Cowen]

Thanks. Good morning, everyone. First question for Jeff. The 2026 Free Cash Flow per share bridge shows Baltic and others contributing $0.20 year-over-year. What is the other component of that? I know Baltic's scheduled for second half COD, but any specifics on the exact contribution start point for Baltic in that number?

[Jeff Hart, CFO at Northland Power]

Yeah, no, there's not, you know, I'd say anything significantly within there, and we'll have the team follow up with you on the details on it. Just 'cause there's nothing that I'd say is a particularly of interest, but I'll have the team follow up with you on them, on that.

[Sean Steuart, Managing Director, Equity Research at TD Cowen]

Okay.

[Christine Healy, President and CEO at Northland Power]

The majority is Baltic.

[Jeff Hart, CFO at Northland Power]

Yeah.

[Sean Steuart, Managing Director, Equity Research at TD Cowen]

Okay, fair enough. Thanks for that. Just a follow-up question on the earlier stage development focus. Christine, you touched on optimism around Baltic expansion. In terms of development dollars you're putting to work in 2026, earlier stage opportunities, can you give us a sense of between Canadian gas or renewables, other projects in Europe, where you see a more clear line of sight on advancing some earlier stage opportunities?

[Christine Healy, President and CEO at Northland Power]

Sure. Thanks for that, Sean. It's a very timely question because it's something that we have been talking about, you know, sort of almost weekly, I would say, since the start of the year, as we look at the different opportunities. In terms of chase and looking at new opportunities, I would say we're sort of... You've exactly identified. We see some great opportunities for offshore wind in Europe, and we see some great opportunities for gas in Canada. Then, we also have a number of projects that are in the queue that we are, that we look at how much do we spend to mature them, and at what timeframe do we mature those projects?

[Christine Healy, President and CEO at Northland Power]

I'll also just add to that, Sean, we also, as we talked about at Investor Day, have some, what we call value enhancement projects in the portfolio, that have to compete for capital against these external new opportunities. We have our existing opportunities in the funnel that we also want to mature. All those things go into the mix. That's the entire concept about having a centralized development organization. Right now, I think we see that the development dollars, I'd say, would be the biggest chunks of them are oriented towards offshore, finding the right next offshore wind project in Europe and finding or choosing the best next gas opportunity in Canada.

[Sean Steuart, Managing Director, Equity Research at TD Cowen]

Thanks for that, Christine. That's all I have for right now. Thank you.

[Operator]

Thank you. Our next question comes from Benjamin Pham of BMO. Your line is open.

[Benjamin Pham, Managing Director, Pipelines and Utilities Analyst at BMO Capital Markets]

Hi, thanks. I just wanted to go to your 6% Free Cash Flow per share, CAGR guidance through in a decade, that you have a range that you put out there. How should you reframe the starting point of that calculation? 'Cause it's a bit wonky using CAD 1.45, also a bit wonky using CAD 1.15 as a base. Like, how do you frame that now?

[Jeff Hart, CFO at Northland Power]

Well, I think Thanks for the question. I think, you know, you stand back as we obviously exceeded our free cash flow guidance in 2025, and you start to stand back and, obviously, there was a bunch of one-time items in there, I think to the tune of, you know, I'll call it CAD 0.20-CAD 0.25, whether it was, we had that German tax benefit and a few other items. I think that's something that factors in, and it's also on my mind, too, is how do we continually get better on making sure we call out, you know, one-time items, and we can kinda clarify this for folks.

[Jeff Hart, CFO at Northland Power]

I think that's a critical piece for us because though you take all those one-time items, they're about CAD 0.20 a share, and that makes a substantive difference to the ongoing run rate of the business.

[Benjamin Pham, Managing Director, Pipelines and Utilities Analyst at BMO Capital Markets]

Okay, you'd use $1.45 less, let's say $0.25. Use that as a starting point, you get to 6% you've highlighted previously.

[Jeff Hart, CFO at Northland Power]

Yeah, like, I don't have the numbers here in front of me, right? I mean, I think you look at it, and you say: Okay, well, what happened in the back-end quarter? Clearly, we had higher wind, that was, you know, put us over guidance. If you look at the full year, that CAD 0.20-CAD 0.25 was one of the big factors in driving us to the CAD 1.46. I don't have the CAGR in front of me, but that's something that we have to make sure that we're clear on, is these one-time items or kind of non-recurring items have to factor in. That you have to take that away, right?

[Benjamin Pham, Managing Director, Pipelines and Utilities Analyst at BMO Capital Markets]

Okay, understand. Maybe switching to the early comments on the super cycle and volume demand being quite robust in all your key markets, do you think your position, I mean, you clear your position well on where you are now, but do you think you need to go elsewhere to position better or differently to benefit from this super cycle going forward?

[Christine Healy, President and CEO at Northland Power]

Thanks for the question. We had a really deep dive on this as we were preparing for our strategy for the upcoming 5 years. We see that we have opportunity. It's an opportunity-rich environment for us in Canada and in Europe. These are both, you know, very large markets. You know, I think we have ample space for us as a company to fill in and to, you know, to deliver on what we've committed for the 5-year horizon in those markets. We're very focused on deepening where we are instead of spreading out into new locations.

[Benjamin Pham, Managing Director, Pipelines and Utilities Analyst at BMO Capital Markets]

Okay, got it. Thank you.

[Operator]

Thank you. Our next question comes from Heidi Heuch of BNP Paribas. Your line is open.

[Heidi Heuch, VP at BNP Paribas Securities Corp.]

Hi, good morning. Thank you for taking my questions. I just wanted to start with, in your annual report, it had mentioned deprioritizing the floating portion of the Scotland offshore wind project. Can you talk about what drove that decision and what that might mean for the types of projects or technologies you're more likely to pursue within the growth pipeline? Thank you.

[Christine Healy, President and CEO at Northland Power]

Super. Thanks for the question, Heidi. I appreciate it. Because we see so many fixed bottom opportunities for offshore wind, then we really had to look at: Do we need to move to floating right now? I think the answer that we came to, as we looked at the opportunity set, is that we don't need to. Right now, we think that there are good existing technologies for offshore wind. I think that we're differentiated in our ability to deliver that and to deliver those projects well. Maybe back to the previous question about deepening in geographies, it's also deepening in the things that we know. We're very good at that, and so we're gonna keep doing that, and we see an opportunity-rich environment for us right now.

[Christine Healy, President and CEO at Northland Power]

Yes, you're exactly right that we're deprioritizing the floating, and we're more focused on the fixed bottom offshore wind.

[Heidi Heuch, VP at BNP Paribas Securities Corp.]

Great. Thank you. Can you update us on the potential to contract the remaining portion of Nordsee One when we saw that positive update on contracting one third? Are you still kind of in conversations to contract the remaining part? Thank you.

[Christine Healy, President and CEO at Northland Power]

Thanks, Heidi. We keep a careful eye on that. The one-third contracting leaves us ... We're happy with that in terms of having a stable cash flow from the asset as we look across the upcoming five, six years. That's very helpful. We see, you know, as you probably know, the spot price has been actually pretty robust recently. When we see that robust spot price, you know, how much, how much of that are we willing to contract away in favor of stability? Right now, the one-third, two-third split is okay for us. We continue to watch the market and look for different opportunities.

[Christine Healy, President and CEO at Northland Power]

It gives us, in fact, optionality on that, which I really value in the portfolio, especially when you look at the new, highly contracted generation coming in. It gives us a bit more room, that we're not exposed to a huge amount of variability with that, and we can absorb that within the portfolio approach.

[Operator]

Thank you. I'm showing no further questions at this time. I'd like to turn it back to Christine Healy for closing remarks.

[Christine Healy, President and CEO at Northland Power]

I'll be brief and just say thank you everyone for joining us today, and thank you for your continued support.

[Operator]

This concludes today's conference call. Thank you for participating, and you may now disconnect.

Participants

Executives

• Christine Healy, President and CEO
• Jeff Hart, CFO

Analysts

• Baltej Sidhu, Vice President, Equity Research Analyst at National Bank Financial
• Benjamin Pham, Managing Director, Pipelines and Utilities Analyst at BMO Capital Markets
• Heidi Heuch, VP at BNP Paribas Securities Corp.
• Mark Jarvi, Equity Research Analyst at CIBC
• Nelson Ng, Vice President, Equity Analyst at RBC Capital Markets
• Sean Steuart, Managing Director, Equity Research at TD Cowen