Northland Power Inc. (NPI) Earnings Call Transcript & Summary

Good morning, and welcome to the 2021 Annual and Special Meeting of Shareholders of Northland Power Inc. The host for today's meeting is Mr. John Brace, Chairman of the Board. [Operator Instructions] Now I'd like to turn the call over to your host. Mr. Brace, you may begin.

Thank you very much, operator. Good morning, everyone. As was said, I am John Brace, the Chair of Northland Power, and I will act as the Chair of this meeting. I want to welcome you and thank you for attending this Annual and Special Meeting of Northland Power's Shareholders. I hope that each of you and your families have managed to stay safe and healthy in these difficult times. I would like to take a minute to express to you that the health and safety of our customers, employees, contractors, suppliers, partners and shareholders remains our #1 priority. We continue to take all precautions necessary to ensure that we minimize health and safety risks as our business continues to operate amid the COVID-19 pandemic. As such, we have decided once again to hold our annual and special meeting in a virtual-only format. We recognize that this pandemic affects the most vulnerable members of our communities, and we have been fortunate to be in a position to give back. We donated more than $750,000 to organizations around the globe that are providing on-the-ground services and health care in the local communities wherever we have an office, facility or project. These funds went towards social service agencies, community food banks and support for frontline health workers. You will hear more about this during the management presentation at the end of this meeting from our President and Chief Executive Officer, Mike Crawley. I would also like to note that Mr. James C. Temerty, C.M., who co-founded Northland Power in 1987, decided to retire from the Board of Directors on January 31, earlier this year. Mr. Temerty was key in creating and shaping Northland Power's foundations and direction, leading the corporation to become a preeminent global player in the renewable power sector. Northland Power will be forever indebted to Mr. Temerty and his wife, Louise Temerty, for the vision they had for the corporation and their leadership to get us there. We wish them both well. In addition, Mr. Barry Gilmour, a long-standing member of the Board, advised the Board of his intention to retire at today's meeting. The Board would like to thank Mr. Gilmour for his significant contributions to the corporation and wish him all the best. At this time, I would like to take a moment to introduce the current directors of Northland Power as well as the 2 new director nominees, all of whom are joining us remotely by webcast today. First, our current directors, Russell Goodman, Lead Independent Director and Chair of the Audit Committee; Lisa Colnett, Chair of the Human Resources and Compensation Committee; Dr. Marie Bountrogianni, Chair of the Governance and Nominating Committee; Linda Bertoldi, Director; Keith Halbert, Director; Ian Pearce, Director. Next, the 2 new nominees to the Board: Helen Mallovy Hicks, Helen is a senior partner with PricewaterhouseCoopers with over 30 years experience advising clients in value creation, capital allocation and complex transactions; and Kevin Glass, Kevin is an experienced CFO, serving in that role for a diverse set of companies, ranging from high-growth enterprises to one of Canada's largest financial institutions, namely CIBC. The more fulsome backgrounds for Mr. Glass and Ms. Mallovy Hicks are described in this year's management information circular. Before formally calling the meeting to order, I would like to address some logistical matters. Historically, Northland Power held in-person Annual Shareholder Meetings, and all then current directors, director nominees and senior officers attended and participated in the formal business of the meeting. However, in light of the continued health impacts of COVID-19, including the need for social distancing and various restrictions on gatherings in Ontario, this meeting, similar to the 2020 meeting, is being conducted as a virtual-only meeting. In order to reduce the potential for technical difficulties, Mike Crawley, our President and Chief Executive Officer; and Michael Shadbolt, our Vice President and General Counsel, both executives and both shareholders of the corporation, have agreed to move and second each motion. This meeting is being recorded and will be made available on our website as well as at www.virtualshareholdermeeting.com. With respect to voting, if you are a registered shareholder or duly appointed proxy holder and have not voted on any matter and wish to vote at the meeting or should you desire to vote at the meeting after having completed and submitted a proxy, thereby overriding your earlier selections, you are able to do so through the live webcast platform by selecting the Vote Here button on the right-hand side of the screen, which will become available to you when the voting portion of the meeting opens. Your results will be tabulated and included in a final scrutineer's report, which becomes available to the corporation after the meeting has closed. I am advised that the proxies deposited with this meeting are sufficient to carry all matters proposed for the meeting. Notwithstanding this, given that we cannot vote by way of a show of hands, after each motion is made, we ask shareholders to vote online if they have not already done so. A copy of the scrutineer's report on the voting results for all matters voted on at the meeting will be annexed to the minutes of the meeting. In addition, the results of the meeting will be set out in a voting report and a press release, each to be filed on SEDAR as required by applicable securities laws and the TSX. With respect to questions, if you are a shareholder or a proxy holder and wish to submit a question during the meeting or during management's presentation that follows the meeting, we invite you to do so by typing your question into the Ask a Question field and click submit. Questions pertinent to the formal resolutions, meeting matters and management's presentation will be answered subject to time constraints. Questions regarding personal matters or questions that are not pertinent to the meeting or management's presentation will not be answered. With respect to technical issues, if you encounter any technical difficulties with the meeting platform, please call 1 (844) 986-0822 if you are located in Canada or the U.S. or call 1 (303) 562-9302 if you are located outside of Canada and the U.S. for assistance. I now call the meeting to order. We will first deal with the formal business, followed by a presentation from management. I ask Tracy Robillard, Secretary of the corporation, to act as secretary of the meeting and to deal with the formal business of the meeting. Tracy, please?

Thank you, John, and good morning to all. I would like to welcome Jeri Trotter and Jennifer Huff has of Broadridge Investor Communications Solutions, who will act as scrutineers today. Based on the scrutineer's report, I confirm that there is a quorum of shareholders present. The notice calling this meeting and the accompanying materials were mailed to the shareholders of the corporation, and I have received proof of mailing of the notice. Accordingly, the reading of the notice of the meeting will be dispensed with. I declare the meeting to be duly called and properly constituted for the transaction of business. The purpose of today's meeting is to: first, receive the audited consolidated financial statements of the corporation for the fiscal year ended December 31, 2020; second, to elect the directors for the corporation; third, reappoint the corporation's incumbent auditors, Ernst & Young LLP, and authorize the directors to fix the auditor's remuneration; fourth, vote on an advisory basis on the corporation's approach to executive compensation; and fifth, consider the resolution to approve amendments to the corporation's articles of amalgamation to increase the permitted size of the Board from the current range of 3 to 9 directors to a range of 3 to 12 directors and to permit the removal of all references to the Class A shares and the Class B and Class C convertible shares. The first item of business. I wish to present to the meeting the audited consolidated financial statements of the corporation for the fiscal year ended December 31, 2020, and the report of the auditors on those statements. Copies of these financial statements were provided to all shareholders of the corporation who specifically requested them and are also available on Northland's website. It is not proposed to read the financial statements to the meeting nor to request shareholders to approve the financial statements. However, if you submit your questions electronically, then after conclusion of the formal business of the meeting, Wassem Khalil, Northland's Senior Director of Investor Relations and Strategy, will answer any questions concerning the financial statements. The next item of business is the election of directors for the corporation. The Board has determined that the number of directors to be elected at this meeting is 9. As required by the rules of the TSX, the corporation has adopted a majority voting policy and has provided in the proxy the right for shareholders to vote for each individual director. I am advised each of the directors has received sufficient votes to ensure their election. As noted before, the official tally of votes will be provided at the end of the meeting when the final scrutineer's report is generated. Based on the recommendation of the corporation's Governance and Nominating Committee, the Board has nominated John Brace, Linda Bertoldi, Marie Bountrogianni, Lisa Colnett, Kevin Glass, Russell Goodman, Keith Halbert, Helen Mallovy Hicks and Ian Pearce to be elected to the Corporation's Board of Directors. I will now pause briefly for any question on this proposal.

John, there are 2 questions in regards to this proposal. The first, what value would be added from expanding the Board from 9 to 12 directors? And would this be accompanied by a process to limit tenure or age of existing director positions to ensure directors are continuing to add value for the shareholders?

Thank you, Wassem. As Northland continues to grow with operations and developments across multiple countries and continents, we need to ensure that we have a Board of Directors that is representative of the company and the company's needs. As such, the Board believes that increasing the upper limit of the number of directors that can sit on the Board is necessary to provide us with optionality, should we need it, to ensure the Board is effective and balanced while providing for new perspectives and ideas. As part of the enhanced governance initiatives that were introduced at the 2020 Annual Meeting last year, the Board introduced age, in other words 75 years; and term, in other words 15 years, limits for directors. We also adopted a new and more expansive Board skills matrix to recognize and respond to Northland's evolution into a truly multi-continental power developer, power producer and also an operator of a regulated utility business.

Okay. The second question, why is there no prerequisite for a director to hold the minimum number of shares to be a director?

While there are no prerequisites for directors to own shares of Northland prior to their appointment to the Board, the company does have a specific policy in relation to share ownership guidelines for both directors and executive management. The policy stipulates that directors must acquire, within 5 years of their appointment, common shares or DSUs equivalent in value to 3x their annual retainer. Furthermore, until they have achieved this threshold, directors are required to invest at least 50% of their annual retainer into DSUs to help achieve the requirement. And finally, I believe making sure ownership a prerequisite to being a director could very well eliminate some very good candidates from the Board.

There are no other questions in relation to this matter.

I will now ask for a nomination of the 9 directors.

This is Mike Crawley. I nominate John Brace, Linda Bertoldi, Marie Bountrogianni, Lisa Colnett, Kevin Glass, Russell Goodman, Keith Halbert, Helen Mallovy Hicks and Ian Pearce for election to the Corporation's Board of Directors.

May I have a seconder?

This is Michael Shadbolt, and I second the nomination.

As the bylaws of the corporation require advanced notice of any other nominees to the Board, none of which has been made, I declare the nominations closed. Since there are 9 nominees and 9 vacancies, may I have a motion to elect the nominees as directors?

This is Mike Crawley. I move that the individuals who have been nominated be elected as directors of the corporation to hold office until the next annual meeting or until their successors are elected or appointed, subject to provisions of the bylaws of the corporation.

May I have a seconder?

This is Michael Shadbolt, and I second the motion.

If you are a registered shareholder or duly appointed proxy holder and have not voted on the election of directors and would like to do so or if you have already submitted your vote and would like to change your vote, please do so now by using the Voting button on your screen. If you have already sent in your proxy or voting instruction forms, you do not need to do anything. Your vote has already been recorded. [Voting]

The next item of business is the appointment of auditors and the authority for the Board to fix their remuneration. I will now pause briefly for any questions on this proposal. As there have been no questions related to this proposal, I will now ask for the motion to be moved.

This is Mike Crawley. I move that Ernst & Young LLP, Chartered Accountants be appointed auditors of the corporation and that their remuneration as such be fixed by the directors.

May I have a seconder?

This is Michael Shadbolt, and I second the motion.

If you are a registered shareholder or duly appointed proxy holder and have not voted on the reappointment of the auditors and fixing their remuneration and would like to do so or if you have already submitted your vote and would like to change your vote, please do so now by using the Voting button on your screen. If you have already sent in your proxy or voting instruction form, you do not need to do anything. Your vote has already been recorded. [Voting]

The next item of business is for a vote in favor of or against, on an advisory basis, a nonbinding resolution on the corporation's approach to executive compensation. The purpose of this advisory vote is to allow shareholders to give their opinion annually on the corporation's approach to the compensation of its executive officers as disclosed in the section entitled Statements of Executive Compensation in Northland's management information circular. As this is an advisory vote, its results will not bind the Board. However, the Board, together with the Human Resources and Compensation Committee, will take the results of the vote into account when considering its review of executive compensation. I will now pause briefly for any questions on this proposal. As there have been no questions relating to this proposal, I now ask for the motion to be moved.

This is Mike Crawley. I move that on a nonbinding advisory basis, shareholders accept the approach to executive compensation disclosed in Northland's management information circular delivered in advance of this meeting.

May I have a seconder?

This is Michael Shadbolt, and I second the motion.

If you are a registered shareholder or duly appointed proxy holder and have not voted on the nonbinding resolution on the corporation's approach to executive compensation and would like to do so or you have already submitted your vote and would like to change your vote, please do so now by clicking the Voting button on your screen. If you have already sent in your proxy or voting instruction form, you do not need to do anything. Your vote has already been recorded. [Voting]

The next item of business is to consider and if thought advisable, pass the resolution to approve amendments to the corporation's articles of amalgamation to: first, increase the permitted size of the Board from the current range of 3 to 9 directors to a range of 3 to 12 directors; and second, to permit the removal of all references to the Class A shares and the Class B and Class C convertible shares. As set out in detail in the management information circular, the purpose of this amendment to the permitted Board size is to provide the Board with flexibility to add additional directors in the future that it believes would add value to the current makeup of the Board and will also help to facilitate succession planning and orderly transition among current and new directors. In addition, as set out in detail in the management information circular, the purpose of the amendment to remove all references to the Class A shares and the Class B and Class C convertible shares is to simplify the provisions in the article as these share classes are no longer outstanding or issuable and therefore, no longer relevant to the corporation. I will now pause briefly for any questions on this proposal.

There's a question on this proposal. What is the purpose of removing reference to Class A shares and Class B and C convertible shares? And I believe Tracy did address this question in your notes. These shares are no longer outstanding and no longer relevant to the corporation's capital structure.

As there are no further questions related to this proposal, I will now ask for the motion to be moved.

This is Mike Crawley. I move the resolution to approve the amendments to the articles.

May I have the seconder?

This is Michael Shadbolt, and I second the motion.

If you are a registered shareholder or duly appointed proxy holder and have not voted on the resolution to amend the corporation's article as just described or if you have already submitted your vote and would like to change your vote, please do so now by using the voting button on your screen. If you have already sent your proxy or voting instruction form, you do not need to do anything. Your vote has already been recorded. We will now pause for 30 seconds to allow for the final votes to be cast. [Voting]

The polls are now closed. I can now advise that based on the preliminary voting results, the motions made before the meeting have been approved and are therefore carried. As noted earlier, the final voting results will be included in the scrutineer's reporters and will be made available, as required by applicable securities law, on SEDAR promptly following the meeting. The formal business of the meeting is now complete. And I ask for a motion to conclude the meeting.

This is Mike Crawley. I move that the meeting be concluded.

May I have a seconder?

This is Michael Shadbolt, and I second the motion.

As nobody has sent in any questions or requests for the meeting to continue, I declare the motion carried and the formal meeting to be concluded. Back to you, John.

Thank you very much, Tracy. I would like to thank you all for attending the meeting. We will now hear a presentation on the corporation's business by Mike Crawley, the corporation's President and Chief Executive Officer. Mike, please?

Thank you, John, and thanks to everybody for joining us today and bearing with us through one more virtual AGM. I look forward next year to seeing everybody in person. Looking at our executive team. There's been a big renewal of the team over the last few years to position us for the next decade of growth. Each recruitment decision was made very deliberately. When I came to Northland 6 years ago, I have been Head of Development of my own development company, renewable development company, where we built out 600 megawatts of operating assets across Canada. Pauline Alimchandani, our CFO, was previously the CFO of Dream, a fast-growing publicly traded real estate development company. Wendy Franks, our Head of Strategy and Investment Management, had invested in renewable power companies and utilities globally on behalf of the Canadian pension plan and developed strong analytical and strategic skills previously at McKinsey. Morten Melin, our Head of Construction, was at the vanguard of building out the first wave of offshore wind projects while he was at Ørsted Investors, prior to joining Northland Power. David Povall, our Head of Development, has developed power projects around the world but most recently in Asia, where we see a lot of growth for Northland in the coming decade. Michael Shadbolt, our General Counsel, has advised on power projects throughout the sector for the past 30 years, and he knows Northland Power intimately, having been here since 2011. Finally, growth requires a sharp eye on talent acquisition, retention as well as organizational structure, and that's exactly what Rachel Stephenson brings to Northland as our first Chief People Officer. First off, I'm very proud that everyone at Northland has continued to operate our facilities at a high degree of availability throughout the pandemic while ensuring our employees and suppliers remain safe. Our growth has also continued, including in offshore wind. Offshore wind has and will continue to be -- to fuel Northland's growth going forward. As decarbonization accelerates, offshore wind will play a critical role in land-constrained countries and regions where onshore renewables simply can't be deployed at scale. Think of Taiwan, Japan, Korea, Northern Europe. We are the #4 operator of offshore wind globally, with that technology set to grow faster than onshore wind and solar in the coming decade. New markets continue to open up for offshore wind, and we will press our market position to participate in each of these new markets. We have the balance sheet and liquidity to support this growth. And looking further ahead, the key elements to Northland's DNA has always been being an early mover, not necessarily the first mover but an early mover in the next stage of the ongoing energy transition. This is where you get the best opportunities and the best returns. We already have a team looking ahead at what's next beyond offshore wind, looking at storage, looking at renewable fuels. And [ the moral of ] expression, the executive team at Northland today can only see the opportunities that lie ahead by standing on the shoulders of the team that Jim Temerty as co-founder pulled together: John Brace, who's now our Board's Chairman; Tony Anderson; Sam Mantenuto; and Dino Gliosca, who is still at Northland and is currently working on our New York wind projects. Combination of entrepreneurial drive and incredible rigor on investment decisions and progress -- project executions have delivered tremendous growth in shareholder value since the 1997 IPO. An investor that stayed with Northland through the Canadian expansion, the expansion into offshore wind in Europe and our current global growth activities will have secured better than 2,000% return on that investment, assuming they reinvested their dividends. Focusing on the last 6 years, Northland has nearly doubled our net capacity, tripled our EBITDA and seen 9% compounded annual growth in free cash flow per share. A lot of that has been fueled by our growth in offshore wind, with the majority of EBITDA now coming from offshore wind. Since our last AGM, Northland has positioned ourselves well for growth by strengthening our balance sheet through some of the proceeds of the $990 million equity raise and added $200 million in liquidity through various refinancings, taking advantage of favorable credit markets. We launched our ESG reporting and stepped up our reporting and launched a green financing framework, and you can see more about that in our 2020 sustainability report that's on our website. On growth, we added Baltic Power, 49% interest in up to 1.2-gigawatt offshore wind project in Poland, a new market that's just now opening up for offshore wind. We acquired 3 development-stage onshore wind projects in New York state, one of the fastest growing onshore markets for renewables. And 200 megawatts of those 300 megawatts are set to go to construction this year. And finally, we entered another fast-growing market for onshore renewables with the acquisition of a 540-megawatt operating renewable power platform in Spain, making Northland the ninth biggest operator of renewable power in that country. As we look ahead, we see the bulk of our growth coming in offshore wind, principally in Asia and Europe. We see material growth in onshore renewables, with that cash flow helping to fund the development of our larger and longer-term offshore wind projects. We see a modest increase in utility investments, principally in LatAm, Latin America, where EBSA is already being -- proving to be a great platform for the development of renewable generation capacity in Colombia. We've announced to the market already that we will not be investing any more in gas-fired capacity, but we are very proud of the role that our current gas-fired fleet has played in displacing coal-fired generation in the provinces of Ontario and Saskatchewan in Canada, and they deliver very important cash flow to the corporation moving forward. Moving further ahead, we believe that storage offers great promise as system operators look to stabilize and build rigor into -- and resilience into electricity grids that now have a lot of renewable power capacity built into them. And we believe also that the next steps in decarbonization are going to start focusing on fuels, renewable natural gas and hydrogen. We have broad teams in some of the fastest growing markets for both offshore wind and onshore renewables globally. Altogether, these teams have a pipeline of 14 gigawatts, with offshore wind accounting for 12 gigawatts of that pipeline. When introducing Rachel, I highlighted the importance of recruiting and retaining the talent to growth. This is particularly true in offshore wind. These are large and complex projects in a fast-growing sector. We already have an excellent team of offshore wind engineering and project managers in Hamburg and in Taipei, serving both Europe and Asian offshore wind markets, and we are continually adding to that talent pool. Onshore renewables -- for onshore renewables, our hub is currently in Toronto, but we will soon be building out a team in Madrid around our platform that we have recently acquired and soon will close on in Spain. And we will use some of those people to help support onshore renewable growth elsewhere in Europe. Our offshore operating and development projects are focused in Northeast Asia and Northern Europe, as you can see on this map, 2 of the fastest growing markets for offshore wind globally. Onshore renewables is centered around the following platforms: our legacy assets in Canada and growth platforms that we have in Spain, New York state, Colombia and Mexico. Lots of focus on ESG these days, but for us, ESG really forms a subset of our overall focus on sustainable growth. That means minimizing our footprint and decarbonizing. It means having a positive impact on the communities where we operate; ensuring our employees are safe, healthy and -- first and foremost, but also that they're inspired and empowered; and finally, that we have clear, responsible and transparent governance. Our specific commitments in terms of sustainability include adding 4 to 5 gigawatts of renewable power, being a 65% reduction in the carbon intensity of our overall portfolio of assets, being committed to the highest standards in terms of health and safety, having a 30% female representation on our Board of Directors and in our executive office. And again, you can see more on all of this in our sustainability report which is on our website. To wrap up, our priorities are to advance our current offshore wind pipeline and source new projects as the sector continues to grow globally and new markets open up for offshore wind; generate near-term cash flow and growth through renewable power development and some renewable power M&A -- onshore renewable power M&A; and finally, be positioned for the next wave of global decarbonization with our focus on storage and renewable fuels moving forward. Thank you very much, and I look forward to any questions that you may have.

We have a number of questions relating to the strategy. Of late, development proposals have gone global. While I do not object to international diversification at all, has the firm lost focus on Canadian development and creating sustainable energy industry in Canada? And secondly, is the current government or regulatory environment review process for domestic Canadian projects unsupportive that the industry must go elsewhere?

Well, Northland certainly has seen, over the last 30 years, significant growth in Canada, both initially in thermal generation and then, of course, in renewables. I would say in a number of the markets and provinces across Canada, they are currently long on energy, and so there's no need for the procurement of any additional renewable power. We do anticipate that changing as the decade progresses, and we keep a keen eye for opportunities for growth in Canada as a result.

Okay. With your deal in Spain, aren't you concerned that you're spreading yourself too thin?

Well, Northland has established a global presence across 8 offices in 4 continents and has over 1,000 employees. This presence in multiple regions has resulted in developing local expertise and strategic partnerships that facilitate securing early-stage development opportunities encompassing a range of clean technologies in target markets. The strategy has created both geographic and technological diversification across Northland's operating development portfolios. Northland remains focused on meeting growing global needs for renewable power, primarily through developing and operating generation projects but also through enabling transmission and distribution infrastructure in Latin America principally. For onshore renewables, we believe that given how competitive the sector is, that it is very important to be selected in which markets you pursue so that you can create an advantage for yourself in those markets. And that's what we're doing in Colombia through EBSA, using that as a platform to develop and acquire renewable power projects in that country. In New York, through the initial wind project and a pipeline of solar projects that we're developing, we believe we can get the advantage of scale to allow us to be more competitive in that fast-growing market. And in Spain, which is projected to be one of the fastest growing markets for onshore renewables over the next decade, the acquisition of the Helios platform positions us as a #9 player in that market, which, again, gives us the scale to compete both in terms of looking at further acquisitions of renewable power assets in that country but also in time as a developer.

With regard to Baltic Power, what is the anticipated payback period? And when will positive cash flow be realized and contribute to dividends?

Yes. So construction of Baltic Power is expected to start in 2023, with commercial operations expected in 2026. So the project will begin contributing cash flow once commercial operations are declared, and we do not disclose payback periods on investments.

There are a couple of questions around the dividend and the corporation's dividend policy, specifically relating to dividend increases.

So while the company does not have an explicit policy in regards to regular dividend increases, the decision on dividends ultimately does rest with the Board. The Board reviews the dividend on a regular basis, taking into account the company's capital needs and future development plans with a view of potential increases to the dividend. We are going through a high capital spend period currently and over the next few years, with the project pipeline of 4 to 5 gigawatts that could potentially double the size of the company by the latter half of the decade. This growth will require significant capital to fund the -- this development and thus, the use of cash is being applied to future growth projects. Typically, the company sets a dividend at a level that we feel is sustainable in the long run. And historically, the company has increased the dividend in line with an increase in the company's underlying cash flows. We also want to note that the company has never cut its dividend in its 34-year history, and this speaks to the prudent approach that it has taken in regard to the dividend.

Regarding your recent acquisition of wind farms in Europe, indicating an increase in global presence, what is your strategy when wind is showing less return on investment and larger Canadian players have sold their international wind farm holdings? How does this fit into a sustainable alternate energy portfolio? And is this a long-term strategy or a short-term strategy?

Well, onshore renewables has a much shorter development period than offshore wind. As I said, the bulk of our capital will be deployed and allocated to offshore wind in the coming years, and the bulk of our growth consequently will come from offshore wind. But in terms of near-term growth, onshore renewables offers better prospects just given how quickly you can take a project from inception to cash flow with solar and with onshore renewables. You're correct to point out that it's a competitive market, and it's more of a mature market than offshore wind. And that is why we believe we have to be very focused and selective in the markets that we pursue. So the markets where we are currently pursuing onshore renewable development and acquisitions, in some cases, are markets that are showing that they will have significant growth and significant need for new renewable power capacity in the coming decade and where we believe that we can create a competitive advantage for ourselves, which both allows us -- will allow us to secure new capacity and also will allow us to secure better returns than we would otherwise if we were a small player in any of those markets.

Could you please speak to the strategic value of the EBSA acquisition, current or future?

For sure. So principally, the EBSA acquisition gave us a platform in a country that we believe will see tremendous growth in renewable power in the next decade. Colombia has been slow previously to deploy wind and solar, but all indications are that in the coming years, they will need additional capacity and that the government and the regulators are looking to put in place incentives and regulations that will drive more development of renewable power, principally solar, wind going forward. So EBSA allows us to get people on the ground in Colombia, our Northland employees. We're able to source project opportunities that we probably would not see otherwise. It allows us to find a route to market for the energy from renewable power projects where we can match the renewable power projects that we develop and bring into operations with an industrial or commercial customer on the other side by leveraging the unregulated arm of the EBSA utility to do that. And more tactically, the EBSA acquisition brought into Northland some immediate cash flow, very stable cash flow, high-quality cash flow, which helps offset some of the volatility that we see in the cash flow from our 3 offshore wind projects in the North Sea, where they have a high correlation to the wind speeds in that region of the world and therefore, you can see quarter-to-quarter and even annual fluctuations in the cash flow from those assets. So EBSA helps offset that.

There is a significant amount of solar energy activity in Alberta currently. Is Northland looking at participating in this market? And if not, why not?

Northland has looked at a number of solar opportunities and wind opportunities in Alberta, and we continue to assess opportunities going forward. Most of them -- all of them going forward are underpinned by commercial offtakes, and we have recently enhanced our capacity to originate such offtake agreements. And our team that focuses on originating commercial PPAs is working closely with our Canadian development team to see if there are any attractive opportunities that we could pursue in Alberta and deploy capital into.

Next question, I'll just read the -- it's a long question so I'll just read the actual question portion of it, and it relates to refinancing opportunities. "I wonder if there is some opportunity to refinance out the term of some of these projects to better align their value or their very long useful life with debt financing terms and perhaps get some interest rate benefits inasmuch as they have proven out their ability to generate the necessary cash flow, product demand."

In the last year, we have pursued a number of refinancings where the -- at the asset level where the opportunity was available, including on Deutsche Bucht and also on a Canadian thermal project as well as a means to both enhance project returns but also increase corporate liquidity. So that is -- those opportunities are -- we are always looking for such opportunities, particularly given the favorable lending market that we currently are in.

There are no additional questions at this time.

Thank you very much. And if there are no further questions, then I would like to thank everybody for joining us today and for your continued support. I look forward to seeing you in person, as I said at the beginning, at our next Annual General Meeting in 2022.

Ladies and gentlemen, the session has now concluded. Thank you for attending today's presentation. You may now disconnect.