Capital Power Corporation

Thank you for standing by. This is the conference operator. Welcome to Capital Power's first quarter 2023 results conference call. As a reminder, all participants are in listen-only mode, and the conference call is being recorded today, May 1st, 2023. I will now turn the call over to Mr. Randy Ma, the Director of Investor Relations. Please go ahead.

Good morning and thank you for joining us today to review Capital Power's first quarter 2023 results, which we released earlier this morning. Our first quarter report and the presentation for this conference call are posted on our website at capitalpower.com. Joining me this morning are Brian Vazio, President and CEO, and Sandra Haskins, Senior Vice President, Finance and CFO. We will start with opening comments and then open the lines to take your questions. Before we start, I would like to remind everyone that certain statements about future events made on the call are forward-looking in nature and are based on certain assumptions and analysis made by the company. Actual results could differ materially from the company's expectations due to various risks and uncertainties associated with our business. Please refer to the cautionary statement on forward-looking information on slide two. In today's discussion, we will be referring to various non-GAAP financial measures and ratios as noted on slide three. These measures do not define financial measures according to GAAP and do not have standardized meanings prescribed by GAAP and therefore are unlikely to be comparable to similar measures used by other enterprises. These measures are provided to complement the GAAP measures which are provided in the analysis of the company's results from management's perspective. Reconciliations of these non-GAAP financial measures to their nearest GAAP measures can be found in our first quarter 2023 MD&A. Before I turn it over to Brian, I want to acknowledge that Capital Power's head office in Edmonton is located within the traditional and contemporary home of many Indigenous peoples of the Treaty 6 region and the Métis Nation of Alberta Region 4. We acknowledge the diverse Indigenous communities that are in these areas and whose presence continues to enrich the community and our lives as we learn more about the Indigenous history of the lands on which we live and work. Okay, over to Brian for his remarks starting on slide 4.

Thanks, Randy, and good morning. To begin, I'd like to announce some very good news. Last week, we executed a six-year contract extension for Gorway relating to its successful efficiency upgrade bid in ISO's same technology upgrade procurement. The efficiency upgrade of approximately 40 megawatts will increase Gorway's combined contracted capacity from 840 to 880 megawatts. The new combined contracted capacity of 880 megawatts will apply to the existing ISO contract upon project completion and extend the clean energy supply contract from 2029 to 2035. The upgrade, which will enhance the efficiency of the existing turbines, is expected to be finished in 2025. We also submitted an efficiency upgrade bid for our York Energy Center facility. Discussions with ISO are ongoing and we are optimistic York will also be awarded a contract extension. Turning to slide five, I'll provide an update on the Genesee 1 and 2 repowering project. The project is on schedule to achieve simple cycle commissioning of both units in the fourth quarter of this year, followed by combined cycle operations in the second quarter of 2024. The current repowering project costs of $1.1 billion, with an additional $195 million for the battery energy storage system. The availability of trades labor continues to be an industry-wide issue, and the repowering project is experiencing modest labor cost increases. We are working closely with the EPC contractor and labor providers to assess the impact and develop further mitigation strategies. The cost pressures, however, are expected to be substantially offset by the lower estimated cost of an alternative solution to the best project. Overall, we continue to be on track to meet our goal of being off coal later this year. Moving to slide six, we continue to advance our decarbonization plans to meet our net zero by 2045 target. The Board is expected to approve the Genesee CCS project in principle by this summer, with a final investment decision in October. The FEED study is essentially completed with results better than original expectation. This includes finalizing capital costs, confirmation of technology, and the discussions of performance guarantees by Mitsubishi. The 2023 federal budget that was announced at the end of March included positive developments for the Genesee CCS project. This included reaffirmation of the role and mandate for the Canada Growth Fund to support de-risking of large-scale decarbonization through instruments such as carbon contracts for differences and enhancements to the 50% refundable ITC for carbon capture utilization and storage. And we continue to have ongoing discussions with the federal government relating to financial support. This includes discussions with innovation, science, and economic development, and the Canada Infrastructure Bank. These discussions are progressing well and on track with the schedule. I'll now turn it over to Sandra.