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

All right. Good morning, and welcome to Northland Power's 2024 Investor Day. So my name is Dario Neimarlija and I'm a Vice President of FP&A and Investor Relations here in Northland. We're excited to be hosting this event live in Toronto as well as this webcast. So thank you all for being here today and all of you that are attending virtually. So we have a full agenda today. So I'll let Mike actually introduce our agenda this morning. But before we start, we have a couple of housekeeping items to note. So I'd like to cover the evacuation procedures for the building. So in the case of emergency alert follow the instructions of the event staff. Exits from the venue are from the main entrance and to the quarter of the right of the stage. The venue staff will direct you to the stairwells and await further instructions from building security. Please do not use the elevators. And lastly, we would like to remind you that comments today may refer to forward-looking information and non-GAAP measures. So please refer to Slides 2 and 3 of our presentation today for more information. And now I'll turn it over to Mike.

Okay. Thanks, Dario, and thanks for everybody for showing up today. It's a big crowd. These things always have a little bit of a timeshare pitch vibe to me with you guys eating your breakfast and stuff, so I hope you stay around for the free lunch. So first of all, I want to start with an acknowledgment of the land that we're on today. We're on the land of the Mississaugas of the Credit, the Anishnaabeg, the Chippewa, the Haudenosaunee and the Wyandot Peoples. So 2023, if we look back at 2023, it certainly was a huge year for Northland. We locked in funding on 3 large projects Baltic Power, Hai Long and the 250-megawatt Oneida battery storage project, $16 billion in total CapEx, 2.4 gigawatts, and all of those together will deliver $600 million of EBITDA, incremental EBITDA by 2027 once they all come online. So 2024 is also going to be a big year for Northland as well, but in a different way. It's all about execution, about delivering these projects on time, on budget and so that's a lot of what today is going to be about. We've got the 2 project directors on the 2 offshore wind projects, Jens Poulsen for Baltic Power, Tim Kittlehalke on Hai Long. They're going to take you through the projects in a lot of detail and be around to answer all of your questions. As well, we have Michelle Chislett, who is the Head of our Onshore business unit, and she's going to take you through the Oneida battery storage project as well. We're going to give you a status, but we're also going to give you a sense of what the future milestones are for those projects. So you'll be able to track the progress of those projects against those milestones as we move forward with construction. So that's going to be the core of the presentation. So at the book ends is going to be me at the beginning. I'm going to give you a bit of a market overview and strategy overview on Northland and then at the end, Adam Beaumont, I think most of you know in the audience, who's our interim CFO, he's going to wrap up with the financial overview on Northland Power. And we'll have, like I said, lots of time for questions and answers at the end, and there's a lunch following as well. So we're all going to hang around at the lunch and take one-on-one questions or have discussions with you, you won't be able to shake us through the rest of the morning. So let's get on with it. So if you look at Northland, we began about 36 years, this is how we always begin these presentations every year. We began about 36 years ago, which was really the cradle, the beginning of the IPP sector in Canada. If you look at how we grew over those 36 years, we really followed the energy transition from doing gas-fired generation initially up in Northern Ontario, a little bit of biomass moving into onshore wind, solar and then into offshore wind in Europe, and then most recently, doing battery storage projects, including building the Oneida project in Ontario. In terms of looking at us as a listed entity or as a public entity, we went from the late '90s being an income trust with a single asset to today being integrated IPP with 6 gigawatts of operating and projects under construction globally. So over this period of time, we've moved into some new asset classes, some new markets certainly. But if you look at what we've done through that whole period, the one thing that has remained constant is our focus on contracted cash flow. With these additional 3 projects, our average contract life will extend from 8 years to 16 years. 90% of our cash flows, once all these projects come online, will be contracted. And through all of this growth, through all the expansion over the last 36 years, we've maintained a BBB credit rating, which is really fundamental to how we run the business. So the last year certainly has been challenging for listed IPPs, and I acknowledge the experience that a lot of the shareholders in the room have had through the last year. But I would say that the value of our assets, what we operate and our development assets as well has held up through this period. When you look at our sell-downs, that evidence is it, but also when you look at some other transactions, you look at the Parkwind transaction in Europe, the sale of all of their offshore wind assets, in Belgium and their development portfolio. You look at the valuation that they were able to secure in 2023, it demonstrates the value of renewable energy assets onshore offshore has held up well over the last year. So in terms of onshore renewables, we have 1.2 gigawatts of operating capacity, primarily in Canada, New York and Spain. And we've got teams on the ground in each one of those markets, so we want to grow more in each one of those markets, and we see opportunity in each one as well. In offshore wind, we'll probably 1 of 10 companies globally that can take a project from beginning all the way through construction and into operations. So we think that's a real competitive advantage. We currently operate 1.4 gigawatts of offshore wind, and we've got a strong pipeline behind that as well. And our gas facilities, our legacy gas facilities, they continue to deliver reliable cash flow. And what's new about them in the last year, we've seen some really good opportunities to optimize, to even expand those gas facilities as the system operators in our case, in Ontario and Saskatchewan look to increase capacity fairly urgently. And then with the 250-megawatt Oneida project, we are now -- because it's the largest battery storage project being built in Canada, one of the largest in North America, I think, Michelle. We are a leader in battery storage, and we want to leverage that moving forward because we see a lot of opportunity in Alberta, in Ontario and New York. So it's the story of 2023 was really locking down our funding, securing our supply chain and launching construction on 2.4 gigawatts gross of projects. What those projects will deliver is a 7% to 10% CAGR on EBITDA from '23 to '27, which is a step-up from the 5% CAGR that we would have seen over the last 4 years. And when you look at what's going on in the sector, and we'll talk about it in a second, there really are some promising signals for how the sector is starting to turn around and some of the headwinds are starting to turn into tailwinds. But the most important thing for you to take away today in my view is that Northland doesn't have to do anything else for the next 2 to 3 years. We have locked in all the growth that we need to meet our targets by 2027. We don't need to tap any supply chains. We don't need to tap in equity markets. We don't need to tap debt markets. We don't need to do any M&A. We just need to execute on these projects, which is what we're going to talk to you about today. anything else that we do, and we think that there will be opportunities to do more is purely discretionary, and it will be upside to everything that you're seeing presented today in terms of numbers. So as we dig a bit deeper into 2023, we're going to run a bit of a highlight video to give you a sense of what went on, and then I'm going to give a few more points. [Presentation]

Okay. So as you can see from the video, we certainly brought 3 big projects into construction last year, but we did more than that. We brought some projects into operations, so brought some new cash flow into the business as we brought 220 megawatts of wind in New York State into operations in the fourth quarter of last year. We also moved forward on our sell-down strategy, bringing partners into our projects at different stages. So on Hai Long, we brought Gentari into that project. It's a $1 billion deal. So it certainly helped fund the projects, $1 billion of funding but it also strengthens the sponsorship group by bringing all the skills, the background at Gentari and its parent Petronas has in terms of doing business in Asia in terms of executing on marine projects. It also allowed us to recycle some DevEx. So taking the DevEx out that we had put into Hai Long some of the DevEx and be able to redeploy it in other opportunities elsewhere in the world where we're developing projects. In Scotland, our ScotWind project is -- floating project and a fixed foundation project, we brought ESP, an Irish utility into that project of the 25% interest last year. So ESP, large Irish utility, but they've also been developing and building projects in Scotland onshore renewables and offshore. So they're adding value to that project as a partner. And again, it allowed us to recycle some DevEx. So all of our costs that we had put into that project, what we paid for the leases, the DevEx that we had put into that -- those projects up to that point, we got back. And all of that we can put into other development projects elsewhere or we can use it to fund our cost going forward on the ScotWind projects. Our operations teams last year did incredibly well. They got 97% availability across all of our fleet globally to really high value. And in terms of how we organize ourselves, how we do business, Northland restructured at the beginning of 2023 into business units. So an offshore wind business unit, an onshore renewables business unit, which Michelle heads up, and we put our gas facilities and EBSA into a third business unit. And that's all about getting all of the financial, technical, commercial skill sets within one business unit, recognizing that the technologies are different, and that you need different skill sets and having accountability to actually run each one of these businesses, it allows me to delegate down decision-making. It allows the business to scale up over time. and it's really important in terms of our go-forward strategy in terms of how we grow Northland. We also created a project management office. We got Pierre-Em Pierre-Emmanuel Frot here. He's sitting right at the front, you're going to be able to chat to him at lunch. And that cuts across all the business units. Pierre-Emmanuel reports up to me. He has a team which tracks the progress of all of our projects in each one of the business units. Forecast trends identifies things that we should be concerned about, problems that we should get ahead of, he gives a project tools to allow them to better manage their business. And they also has a lineup to the Board as well to make sure the Board has line of sight in terms of what's going on with the projects. So I already said that 2023 was a tough year for renewables. It was a particularly tough year for offshore wind, whether it's looking at the restart of the economy after the COVID shutdown, the Ukraine conflict, the tension spiking up a year ago in the Taiwan Strait. All of that played havoc with market conditions. So it caused costs to build to spike up. It caused permitting times from regulators to be much less predictable than they had been before. And of course, interest rates spiked up. So that increased our cost of financing, our cost of debt. but it also affected the valuation of IPPs more broadly speaking. So I'd say despite all of that, Northland ended the year 2023 stronger than how we began. So how did we do that? Well, first of all, it is what we did. So we had to move quickly. We had to make decisions quickly as market conditions turned on us. So number one, on the revenue contracts that we had on these larger projects, we went back and renegotiated them. So in the Baltic Power project, we were able to renegotiate that offtake agreement to move the indexation reference date back by 1 year to capture a lot of the post-COVID inflation in the tariff. On Hai Long we went back twice, I think, out of twice and renegotiated the corporate PPA that we have on that project on 744 megawatts of that. On the Oneida battery storage project, we went back again twice to renegotiate with the system operator with the government to account for the rising price of lithium and the rising costs overall in that project. We also restructured the project financing, the financings on those 3 projects. So if you look at Hai Long, we increased the ECA coverage. We brought in more ECAs. We increased the coverage that we're offering to lenders, the guarantees that we're offering to lenders that kept our lender group impact. It kept the cost of debt from those lenders at a reasonable level. And then if you flip over to Baltic Power, we also went back and got the CFD with our partner, Orlen, got the CFD, the revenue contract, redenominated into euros, which brought a whole bunch of liquidity into the financing, more lenders into the financing, which allowed us to keep the borrowing costs down and allowed us to get better terms and also allowed us to get more leverage on the project to absorb some of those cost increases as well. And Oneida, we were always working with the Canadian infrastructure bank on that, and they proved to be a very good partner as market conditions change, and we're able to negotiate a really good outcome with them on the financing on that project as well to make sure that it went away. Secondly, it's also what we didn't do, and sometimes those are the tougher choices. So we had a project in Germany, Nordsee cluster, partnership with RWE. The economic started turning downwards on that project as costs went up. We couldn't find revenue offsets for it. So we withdrew from that project, and we were able to sell our interest to RWE. We've got all of our development costs to date back and a little bit of a premium. In Japan, we pulled out of an early-stage offshore wind project. In solar, we canceled 1 project. We deferred another project in wind. We handed back a PPA, which we're now going to rebid. Now that the clearing prices and auctions seem to be moving back up again. So the point of all of this is having a big pipeline, having a strong, a diverse pipeline allows you to have choices, allows you -- gives you options when market forces change. And that's what we did. A lot of things had to happen in 2023 within a very tight window. And I say this that when you've got a tailwind when you got good market conditions, like maybe 5 or 6 or 10 years ago in renewables, everybody looks smart, everybody looks like a hero. It's when you hit some headwinds like we did last year, that you can really see the strength of a team. And I got to say, I am so impressed with everything that everybody at Northland was able to do, you're going to see some of the presenters today, and all of them were integral to making these projects, not just work but making these projects really attractive investment opportunities for Northland and really meaningful for Northland's growth going forward. So obviously, all of this hasn't yet been reflected in the share price. But let's talk now about some of the tailwinds that we're seeing emerging in the last month or 2. On rate cuts, I mean, your bet is as good as mine in terms of when that's going to happen. So I'm not going to speculate on that. But what is clear, of course, is that inflation has come down. Commodity prices have come down. Steel is now trading within its historical range. Supply chain constraints are easing. So with project deferrals, project cancellations, you're seeing vessels become available. You're seeing more capacity even added into the supply chain now. And if you look at the 2 offshore wind OEMs through 2023 Vestas and SGRE, our biggest nemesis through 2023, right Jens. They are ending the year 2023 and starting 2024 in much, much stronger positions than they were 6 or even 10 months ago. But the biggest tailwind of all, the biggest tailwind of all is the rising demand for power. And it's not really any more about climate policy. It's not really about government policy or incentives for renewables. It's about a need for a huge volume of electrons and principally green electrons. So let's unpack a bit of what's driving that. Number 1 is reshoring. So you're seeing a lot of manufacturing coming back to North America, coming back to Europe. Electrification of industrial processes is driving a lot more demand for power. A big one is AI and cloud data center and cryptocurrency data center demand, huge demand for power. And even if you look at Hai Long, we signed a 744-megawatt corporate PPA on Hai Long. It's huge. I think it was the biggest ever at the time, corporate PPA that had been signed -- and you look at what's going on in Taiwan right now and they need even more power to the tech center there, even more green power. And the piece that circular on all of this is critical minerals, right? The critical minerals that are needed for the data centers and for AI. That takes power to extract those minerals, it takes power to process those minerals. So let's dig a bit deeper into the data centers AI. One NVIDIA GPU or chip uses out the same amount of energy per capita that the average U.S. household uses up. So if you take a figure for 2023 and 2024, I think around NVIDIA is going to sell around 3.5 million of these GPUs in [ 20 ] -- in those -- over those 2 years. that will end up being about the same power consumption of the state of Lithonia or the country of Georgia. The International Energy Association out of Paris estimates that in 2 years, data center power consumption could double and that would end up equating to the total power consumption of Japan. So let's look at reshoring. U.S. manufacturing has hit a 50-year rather high. And looking at Canada, if you look at Northvolt or Volkswagen, there's other lesser known names, when they look to site a factory or a facility, one of the top criteria is, will there be enough energy? Will there be enough renewable energy to power that facility going forward? So if you look at a country, a province estate, when they're looking at how to grow their economy? How do we expand? How to create prosperity? The biggest determinant is going to be for them over the next 10, 20 years, do they have enough power? Do they have enough power to attract the manufacturing, to attract the data centers to come? And to get that kind of growth, they need power projects that can be built at scale. That's what we do. That's what Northland does. We build large complex power projects. We've got the pipeline. We've got the talent to do it. There's certainly going to be challenges moving forward. There's going to be constraints, transformers. Will there be enough transformers? What's the wait time for transformers, transmission capacity? We'll have to get ahead of all of this and anticipate all of that. But fundamentally, the one thing I want to leave you with today is Northland is in the right business for the next decade. And I think we're in some of the better markets, too, going forward to be able to benefit from this growth. So if you look at home in Ontario and Quebec, the system operators in both of those provinces in the last few months, have announced that they're going to need to double their power generation capacity by 2050. A lot of attention paid to the IRA, the inflation Reduction Act in the U.S. and it's certainly a big driver of the growth in renewables in that country. But if you look more broadly at what's going on in the U.S., it is really a much bigger industrial policy involving reshoring, incentivizing reshoring of manufacturing and also looking at the CHIP Act is all about bringing data centers within the U.S. territory. All of that is driving a lot of demand for power. And that policy crosses party lines, it's not partisan. The U.K., very small island, huge need for power. That's why they've got an offshore wind target of 50 gigawatts by 2030. So they're running annual procurements that we'll participate in to secure that offshore wind capacity. Now in Taiwan, our focus right now is just on Hai Long. But if you look at what they need to do over the next decade, what they've announced they're going to do, they need an additional 13 gigawatts of offshore wind that they're going to procure over that period of time to feed the demands of their tech sector. Poland, it's one of the most carbon-intensive grids in Europe and in the EU. And that's why they're targeting 11 gigawatts of offshore wind that they're going to have to get built by 2040. They'll need projects of scale, big offshore wind projects. We are building the first offshore wind project in Poland. There's others that are going to follow over the next 2 or 3 years, and we want to do more in Poland. South Korea, I'll wrap up with South Korea. It's a big export-oriented industrial economy, a lot of heavy industry. They are paying very close attention to carbon border adjustment mechanisms as they emerge in Europe and elsewhere, very conscious of doing what they have to do to maintain access to these markets, which means decarbonizing what is right now a very carbon-intensive grid. So the government's got a target by 2036, of turning that carbon-intensive grid into 1/3 renewables. And they've got offshore wind legislation that's working its way through the legislature and up through the executive branch. And it's not just about targets, about objectives and about supply or capacity. It's also, if you look at the bottom part of that slide, it's about what governments are doing to accelerate permitting and to provide support, and this is really in the last 6 to 10 months support to the supply chain to make sure that there is an adequate supply to build all of these projects that need to get built. So the result of all of these dynamics is once again rising prices for renewable PPAs. So you look at this curve and where it started with some of the original PPAs or subsidy contracts that we got in Europe, price came down dramatically. And what we're seeing in the last 6 months is prices now coming back up significantly. So in the U.K., they raised the ceiling price for offshore wind auctions by 66% in the fall. They ran an onshore procurement that saw prices increase significantly from what the previous procurement had. In New York State, the last few procurements, 2 procurements have seen clearing prices go up 30% to 50% from what they were previously. And even just last week, Ørsted and Equinor, which had handed back PPAs on their 2 offshore wind projects in the fall, rebid and they rebid at, I think, a 40% or 50% premium to what the previous PPA was at and got awarded contracts at that level. So all of this is good for investment in renewable energy capacity. It's a signal of how much the market, how much governments need the capacity that they're willing to pay up and pay the right price to get these projects built. But it's also really good for supply chain constraints because it's a signal to the supply chain that they should invest in more capacity because the whole value chain in terms of onshore renewables, offshore wind is going to be profitable. So with all of these macro factors in mind, let's talk a bit about what Northland's go-forward strategy is. We've got 4 pillars: resilience, execution, prudent growth and optimization. And these 4 pillars underpin our 2024 business plan, which I'll give you a couple of points on right now. So the first pillar, as I said, resilience is and was really a defining trait of Northland through 2023. We made tough decisions. We made them at the right time. We were able to make big things happen with governments, with suppliers that had to happen to make sure that these projects were still successful. Now in 2024, what that means is that we've got $16 billion in projects that we have to construct, the total CapEx. So we need over and above everything else to make sure that we maintain a strong balance sheet, and this is really out of the 4 priorities, 1 of the top 2. And it's also important in terms of looking forward, when we've talked about all these tailwinds about the opportunities that we think are going to come, we want to make sure that Northland is in as strong a financial position as possible so that we can take advantage of those opportunities. So we've locked down about 95% of our debt with fixed interest rates. We've secured stable cash flows. As I said before, we've taken our average contract life with these 3 additional projects from 8 years out to 16 years, giving us much more predictability in terms of our cash flows moving forward. And our BBB credit rating is not just foundational to how we've been running the business. It's fundamental to how we're going to run the business moving forward as well. The second pillar is all about flawless execution on Hai Long, Baltic power, Oneida. I'm going to say that a lot today, say that a lot internally at Northland. It's kind of our mantra this year. So these 2.4 gigawatts of projects we have to bring on time, on budget and without incident, that is the other top priority. We've got 2 experienced project directors on the offshore wind projects. You'll hear from shortly who have delivered for Northland before. But beyond that, we've got 3 layers of oversight. So each of these projects has their own project board, which we're on, our partners are on that meet monthly. The project management office, which I referred to earlier, reports up to me provides another layer of oversight for me, for the management team, but also for the Board of Directors. And then the Northland Power Board of Directors has established its own subcommittee to oversee the execution of these 3 projects, recognizing how significant they are to the company. And that's really what today is going to be about. Development is still core to Northland. We're a development company. We're here to take advantage and benefit from the growth in renewable energy over the next decade. But over the next 2 to 3 years, we are referring to it in this pillar as prudent growth. As I said earlier, we don't have to do anything. Anything that we do will be discretionary. It will be based on the economics, the attractiveness of any given opportunity. And if we don't see an opportunity that we like, we don't need to move forward on it. We're also going to focus on a narrower set of markets. We want to double down in the markets that have worked for us that have delivered for us that we understand well, where we've got good teams on the ground -- and if you look at our pipeline, onshore renewables in Alberta, we've got 1.2 gigawatts of solar, most of that with our AUC permits already in place. 700-megawatt battery storage portfolio in that province. It's a province with a lot of renewables now. It's going to need a lot of battery storage and other forms of storage to balance out those renewables. In Ontario, we have just under a gigawatt of battery storage projects, and the team in Ontario is also starting to look at power projects, energy projects as well, anticipating future procurements in that area. New York State, we've got 550 megawatts of solar and wind projects at different stages that we'll be able to bid into procurements over the next few years, and NYSERDA is running annual procurements. And the team on the ground there is also looking at utility scale storage as NYSERDA starts indicating that there's going to be opportunities there as well. Offshore wind, a lot of where our DevEx dollars are still going to be going over the next few years. In Poland, as I said, we're a first mover in Poland. There's a lot happening in Poland. We would like to do more offshore wind in that country. In ScotWind or Scotland, our ScotWind projects are about 2.3 gigawatts. About a gigawatt of that is a fixed foundation project, which could move ahead over the next few years. In South Korea, we've got about 1 gigawatt of mid-stage projects and then 2 gigawatts behind that of early-stage offshore wind projects and a very good team on the ground in Seoul. But we've also deprioritized some markets. So we've backed away from Japan, we've pulled back doing renewable energy development in Colombia, in Romania, we announced last year that we were pulling back from hydrogen export projects. And today, you would have seen with the announcement last night, that we sold the La Lucha project in Mexico, and that's really the second step in us pulling back from the Mexican market. We sold our qualified supplier last December, and now we sold the 130-megawatt La Lucha project at a good valuation. So overall, we've got about a 12 gigawatt development portfolio. And again, what that gives us is options, allows us to be selective in what we move forward with. It allows us to bring partners in on some of these projects. We're not necessarily going to fund all of these projects ourselves, but we think it's a real strength for the company. So funding growth certainly used to be 10 years ago about doing a bought deal right around when we're doing -- reaching financial close, issuing some shares, raising the equity funding the project. It's different now. So a good part of how we fund growth going forward is going to be about recycling capital. And there's 3 reasons why we do that. One is to enhance returns. So if you look at the ScotWind project, we've got a plan to do a 2-stage sell-down. We sold down 25% already to ESB. Next year, likely, we would sell down another interest, maybe 25% and on that sell-down, we would look to get a premium given how much we've advanced or matured that project, and that will help enhance our returns on that investment overall. The other is to manage our exposure to a single project or exposure to a single market. The sell-down to Gentari in Taiwan is a good example of that. Hai Long is a very large project, and it allowed us to manage our exposure to that project by dialing back from 60% interest to 30% interest and also managed our exposure to Taiwan overall. And the third reason to do a sell-down is to or to recycle capital and do a sell down is to improve a project's chances of success. And certainly, ESB, Gentari they also play into that as well. But if you look at the Mitsui partnership in Taiwan, it was absolutely essential last year in terms of making that financing work. Their relationships with Asian banks, their relationships with the two ECAs in Japan that played a big role on that financing, really made that project successful. And they've done business in Taiwan for 100 years. So they also had a good sense of how to make things happen in Taiwan. In terms of use of proceeds on a sell down, number one, is to strengthen the balance sheet. It allows flexibility, it allows options. So you look at what we're doing with the proceeds from La Lucha, that capital will come back to corporate, probably stay there for a bit until we see the right opportunity to move forward. Second is to be able to eventually or maybe immediately sometimes redeploy that capital into new investments in our core markets where we want to focus our growth going forward. So flipping over to ESG just quickly. We've made a lot of progress over the last few years in terms of both setting goals, being clear to the market in terms of what our targets are, being clear in terms of our reporting and we've also been doing a good job, I think, in the last 2 years in terms of moving ourselves gradually towards those targets. This is Yonni's area of responsibility or one of Yonni's areas of responsibility. So in 2023, we committed to net zero emissions by 2040. And we also committed to working towards diversity and inclusion metrics related to gender, race and pay parity. We also revamped our supplier and partner code of conduct and our human rights policy, so that not only can Northland adhere to the highest standards, but we can also get our partners, our suppliers to similarly adhere to the same standards. Now sustainability is also a big emphasis or a big priority at the project levels. And if we just look at these 3 projects that we're talking principally about today. Each one of them will make meaningful impact on decarbonization in each of their country, each one of their markets, so Taiwan, Poland and Canada. And if you look at Baltic Power, because of the size of the project, Baltic power and because of the carbon intensity of the grid in Poland, Baltic Power alone will help avoid more CO2 emissions in a year, 2.8 million tonnes than all of our onshore renewable fleet did in 2023. And earlier this year, you would have seen our announcement that we are using -- we're the first offshore wind project ever to use low emission steel in the towers on the Baltic Power project. So 52 of Baltic Power 76 towers will use recycled materials, so low emission steel and that will account for 15% of the total steel used on those towers. So it's an important first step. We think it's a model for what we want to do moving forward in terms of lowering the carbon content of these projects -- decarbonizing projects, but a little lowering the carbon content of the projects. And we also hope it will be a model for other offshore wind and onshore wind projects moving forward as well. Okay. The next hour is going to be about construction and execution. I'm going to give you a very high-level summary, and then we're going to dig into a bit more detail on it. So here's a quick overview of where we're tracking against Hai Long, Baltic Power, Oneida. One thing to note is that there's obviously no in-water construction on Oneida but that project is very well progressed, 45%, I think it's almost 50% complete at present. Michelle will give you more details on that. If you look at the 2 offshore wind projects, so in 2023, the delays in the financing because of market conditions, certainly increased the exposure for Northland and our partners on those projects. But once you flip past financial close in September on those projects, what that meant is that both projects were really quite well advanced, more advanced than any project that we had at financial close. So if you look at Baltic Power, it's about 10% complete and Hai Long it is actually 30% complete. Overall, all 3 projects are progressing on time and on budget. A big enabler for our project success is the partners and suppliers that we bring in. So partners help unlock relationships with governments, suppliers, and lenders on Hai Long. I talked about Mitsui already and what they did with Asian lenders and Asian and the Japanese ECAs Gentari through their parent, Petronas brings a lot of knowledge, not just about marine construction, but how to do business in Asia, given all of the experience and the relationships that Petronas has there. On Baltic Power Orlen, the oil and gas company in Poland, our partner on that project is one of the largest companies in Central Europe. I think it's the largest company in Poland, and they were absolutely integral last year in terms of renegotiating the CFD, the revenue contract and in managing stakeholding and permitting processes as we move that project through to financial close. Oneida, the project is actually on Six Nations territory. So the partner on the project and the original -- one of the original developers on the project is the Six Nations of the Grand River Economic Development Corporation. So they continue to be a partner and investor in the project. Aecon, our contractor on the project is also an investor in the project NRStor, who some of you may be familiar with kind of a pioneer in battery storage and storage technology in general and developer developing those projects in Canada. They've -- were the one of the original developers along with Six Nations. They flip their sweat equity into real equity in the project. So you look at all of that, we think it creates a really great alignment of interest on Oneida moving forward. So if you look at the right side and some of our contractors, we think that we've been able to pick some of the top-tier contractors on each one of these projects. We ran procurement processes, competitive processes. But in some cases, we didn't pick the lowest cost provider. We picked the one that we knew we could rely on that would be dependable and would be able to deliver. A lot of these suppliers that you see there are ones that we've worked with before, Deme, Van Oord, Siemens Gamesa that we've had very good experiences with. So on downside risk, Northland project finances all of our projects. That's how we -- that's our methodology for developing projects. So project financers, there are independent engineers who provide an additional layer of scrutiny on each one of these projects that we think really provide some good downside risk mitigation. So we must, on each one of these projects, hedge interest rates and FX on the construction cost, but also the distributions of cash flow that come back to us. The lenders push us to put scheduled buffers in, which you'll hear more about in the upcoming presentations. Cost overrun contingency, substantial cost overrun contingencies have to be embedded, and we have to fix all of our supplier contracts to the extent possible. On returns, Northland has a reference rate methodology that we use that ensures that we always target a return on any investment that is comfortably above our cost of capital. And if you look at optimizations that we see going forward in some of these projects, particularly on the 2 offshore wind projects, they have revenue contracts that go from 20 out to 30 years. The debt tenor is shorter than that. So we see an opportunity, number one, at COD to reamortize that debt, to resculpt that debt, which would help pull some cash flow forward and enhance the returns on those projects. We also would see an opportunity at COD once the risk profile on the project has come down to refinance the project, which we've done on all 3 of our previous offshore wind projects. I think on Gemini, Adam, we were able through 2 refinancings to get about 100 basis points reduction in the spread on those -- that project. And then, of course, on execution. We always talk about delivering these projects on time, on budget. But we're also pushing to see if we can get ahead of schedule and do better than budget. And if we are able to do that, on either of the projects or any of the 3 projects that obviously is upside to our returns. Across all 3 projects at present, we are targeting to get double-digit returns looking at the 3 projects in aggregate. And moving forward, for any new investment that we will be pursuing in the current market environment, we would also be looking to get low double-digit returns as well. And finally, this is the last slide. This is a leadership team that will oversee all of our construction program Toby Edmonds isn't here. You would have seen the announcement of Toby a couple of months ago. He is our new Head of the Offshore Wind business unit, our EVP of Offshore Wind. He's got about 15 years in offshore wind experience. He comes from Maple Power, the CPP and Enbridge offshore wind partnership in Europe. Previous to that, he spent many years at RWE, he was a project director on 2 large offshore wind projects in the U.K. He'll be joining around the middle of May is when he starts. Tim Kittelhake will be presenting shortly. He's the CEO of Hai Long. He's got 18 years experience in offshore wind. He was responsible for the construction of our Nordsee One project, which came in on time, on budget. And he also took that project through into operations and asset management. Jens Poulsen will speak to you about Baltic Power shortly. He's the Project Director, 14 years' experience in offshore wind. He delivered Deutsche Bucht for Northland, again, on time, on budget. And then moving to Michelle Chislett, Head of our Onshore Renewables business unit. She's got 18 years' experience in the renewable energy sector, 8 of those with Northland. She was part of the team that developed finance and construction. I think the first utility scale solar project in Canada, First Light. I know Michelle from before at AIM and our successor companies, IPC and GDF as we sold the company forward. She headed up renewables for us. I think you had a supplier go -- actually you had a solar panel supplier go insolvent heading to financial close, and you managed to bring the project in on schedule and actually with better economics. And the last thing you did before Northland was you were at SunEdison as a country manager. Within your team, you've got Nick Zsofcsin and Bill Small. So Nick is a head of our storage business -- our storage unit within Michelle's business unit. He has a background in doing storage projects for a smaller developer Saturn, but a real pioneer in doing storage projects. We pulled them into Northland because we wanted to have that talent as we saw the opportunity in storage develop. Bill Small has been doing leading construction on energy projects for, I think, 20, 25 years, 30 years. And most recently, he did battery storage projects in Texas. So we've been able to bring that skill set to Oneida. Pierre-Emmanuel Frot, as I said earlier, is in the audience, he can talk to you about the project management office. You previously had done the same thing at Schneider Electric for many years. Yonni Fushman, our CAO and Chief Legal Officer, joined Northland 15 months ago, from Aecon construction. So you can see the theme here is really about strengthening our bench in terms of project execution and construction capability as we head into a pretty intense construction period. So with that, I'm going to flip it over to Tim to talk about Hai Long.

Thank you, Mike, and a warm welcome. Yes. My name is Tim Kittelhake. Please feel free to comment Tim, it's much easier. Yes. As Mike mentioned, 18 years in the offshore industry, 25 years in renewable before I was in the onshore business, a little bit [indiscernible] well in Germany. In my career, I've overseen the development of 10 offshore projects in the North Sea and the Baltic Sea now as well in the Taiwanese Street. And I'm -- since 10 years with Northland Power this year. And I have the opportunity today to give you a little bit an oversight of our project in Taiwan. Why we are in Taiwan? Taiwan has some good opportunities. First of all, it has an extremely good wind regime. This is related to the situation that Taiwan has high mountains and creates towards Mainland China and nice wind channel, which speeds up the average wind speed above the Asian normal market, and it's even higher than in North Sea and the Baltic sea. We have in addition -- we have good shallow water with solid soil condition, which allow us fixed foundation to use, which brings down the construction cost. We have on top and good feed-in tariff with the government for our 300 mega wind farm parts, the first part along to [ a cold ] and a strong offtake market, as Mike explained before, from the semiconductor industry with a good rating. And we have a good government support. So the relationship with the government is extremely good. If you see any delay, any issue on permitting. We get direct access up to a minister level. So that's an excellent support, which we see in Taiwan. In general, the project will be in the range of 1,000 megawatts, slightly more, 1,044. It will power 1 million households per year. And it will provide stable cash flow and stable income to our investors. Our investors are, as Mike mentioned, 30% NPI, 30% Gentari and 40% Mitsui. Mitsui stepped up last year. Our construction schedule, as you see on this slide is -- has built in a lot of winter buffer. Why is this? Because as explained, we have strong wind conditions. And we have seen that these wins construction exceed quite highly the installation capacity of the vessels. During winter time, this means we would have a lower workability and to avoid long stand still time of the vessels, we have decided to build only in the summertime. We have durations of each of these shown sequences in the range of 109 days. So this means we still have a good buffer compared to the long-term average wind and wave conditions and despite of this buffer which we have in the summer in the springtime, we still have the wintertime. And yesterday, Siemens announced that they finalized one of their projects over winter in Taiwan. They installed there, the 8-megawatt turbine, even in winter time. This shows that we have here quite some good buffer. What we do at the moment is we do the foundation fabrication is ongoing. The installation has meanwhile it started. This means we are preparing the seabed and will start piling in end of March and installing then the first jackets in the end of first half year. In parallel, we are -- we will install the foundation of the offshore substation to allow that the export cables can be laid from onshore into the foundation of the offshore substation and then later the year, the first offshore substation will be installed. Details on the progress of the different fabrication, I will give later. How wind farm looks like? First of all, the picture shows the full asset, which are employed for operations and as well for construction. On one side, we have the onshore substation. The onshore substation is collecting all the power from the wind farm and it feeds into the grid. And there are the meters. This is a grid connection point. In our case, the grid connection for Hai Long 2, the 300 megawatt, which will be the first part, which will go in operations is existing. And the second part for the 744 megawatt with [indiscernible] auction wind farm is under construction ahead of schedule, will be in operation next year, even we only needed in '26. Then you have the onshore cable, its a relative short cable in our case because our offshore substation -- onshore substation is very close to the sea wall, very close to shore. From there, there's a connection point to the so-called export cable. The export cable is in roughly 12-inch cable, very big one to transport the power. It has a level of 220 kV, that's a very high voltage level. This is used to reduce the transmission losses, and it's the best optimum between leverage of the [indiscernible] the increase of the power level, meaning high voltage and cost. The export cables goes into the offshore substance. We have 2 of them, each more than 500-megawatt capacity. Both are in the final outfitting status at the moment. We see later some pictures. From there, like a spider net, the cables goes into each turbine, and we have the lines of turbines up to 5 in one line. And Inter Array cables and the export cables will be laid into the seabed, not laying on the sand, they are laying -- will be laid into the seabed and all these preparation works are at the moment ongoing. And then we have the foundation. The foundation in our case, is a jacket. It's like a lattice tower. It is different to Baltic power or what we have used in the North Sea so far, which is a monopile. The lattice tower has advantages because we can go into deeper bottom. We can have a more stable fixation in the ground. This is necessary due to the environmental which we are facing. We see risk of worst case. We see risk of typhoons and tsunami. And all of this is the reason why we are using these lattice tower, called jackets. And in jackets will be fixed with 3 piles on each corner, its a 3-legged jacket, will be fixed with long piles into the seabed. And they are one of the longest up to 95 meters long. So that's a quite long steel tube, which is hammered into the seabed and then the jacket is installed. On top, we have a turbine from Siemens and 40.7 megawatt turbine, which is a direct driven turbine, latest design. It's an upscale of the existing well running and well-known fleet of Siemens 8-megawatt turbine. It's in Danish design. So it has nothing to do -- to be highlighted. Nothing to do with the Gamesa gearbox driven turbine. It's a direct-driven turbine with an extremely good track record in regard of liability. And now we see one of the pictures of the construction. This is the jacket for the onshore -- for the offshore substation. The jacket sailed out end of February from our Vietnamese supplier, PTSC, it's an oil and gas service company. The jacket is as high as we are at the moment above ground. So it's 75 meters. So we are on the 16th floor here. So to give you an image, how big these foundations are. It's a 4-legged jacket compared to the 3-legged jacket, which we are using for the turbine to be a little bit more stable because on top, there comes to a 3,000 ton topside, which is roughly in house of 10 apartments, each 100 square meter for floor high to give you an image, how big these jackets and how big our offshore substations are. And you see as well on the barge, the Pin Piles -- so-called Pin Piles in our case, a 4-meter diameters, so it's wide as the stage here. And they are 85 meters and each will be then fixed into -- filed into the corner sections of the jacket and then with a special concrete fixed missy Foundation. This is a picture of our onshore substation. You see it's very close to shore. It's again reducing transmission losses because here is our meter. And from there, the grid connector takes over and the offtaker takes over and the further losses towards the grid is with them. It's only some 100 meters to the point where the export cables will be connected. This is a 2 months old picture. The onshore substation meanwhile, is in outfitting status. So we have moved in the major transformers, the main transformers. The main transformers have fast FAT. We have moved in at all the gearboxes in the switch [ wheels ]. It's not gearbox. This is switch boxes to connect and disconnect the power, and we are doing at the moment the cabling. All is at time and as planned. You see as well here in lattice tower wide and red stripe. This is a data collection, which is in 4 big scenario if the fiber cable would not work. Here, we can steer as well the wind farm with a direct data connection which is on radiolink. The next slide shows the newly enlarged facility of Siemens. Siemens has built in the last years, several hundred turbines of the 8-megawatt size to fit our 14 megawatts turbine, which is nearly close to 2x bigger than the 8 megawatt, they have enlarged the site. The site was opened together with the Prime Minister of Taiwan mid-February. It's at the moment in the outfitting, though all the materials and all the equipment for assembly [indiscernible] is coming in from Europe. The team was trained for assembly, the 8-megawatt turbine, then send the Taiwanese team sent to Europe to Brando and Cuxhaven to learn how to assemble our turbine and the adviser and supervisor from Siemens will move into Taiwan earlier spring this year to be the supervisor for the construction of our turbine. So we do not expect any ramp-up because the team has been trained in the past. It is trained on our new turbine and the turbine itself is in 0 production in Europe and is used in other wind farms before our wind farm. And this is now the so-called jacket. You see it is a -- it looks here quite small, but it's again, 75-meter height. It is -- the corner sections are 3.5 meter in diameter. So that's 2x my size, it can name it. And it's a weight of 2,100 to 2,300 tonnes. So this is equal to 1,500 Tesla cars. You stack together and then you have the same weight like these foundations. And these foundations are only what you see above sea level. And they stick out 20-meter out of the water. On top, we have these pin piles which will be installed upfront and the pin piles are 3.5 meter in diameter up to 95-meter long. These are the longest so far used in the industry. All of them has been meanwhile, produced in Korea. And a small portion is under local content requirements, which is ongoing in the South of Taiwan. They are as well ahead of schedule. This shows that even in a relatively new market like Taiwan, suppliers step up if the demand is correct and as well if you choose the right ones. On top of these 3-legged jacket, there's a so-called transition piece, which you see on the left side of the picture. And the transition piece is there to distribute the loads from the turbine in the tower, into the foundation. So it is a special designed piece of equipment, so-called transition piece, the monopiles have different kinds of transition piece, but it's a standard use. But it gives you only an idea what we are talking about the transition itself is in the range of 20-meter height by itself. How we install this. We are using a heavy crane vessel, which is -- which has several propellers to be stable in the position, so-called DP2 and DP3. This vessel is a new build vessel built in Taiwan as well to support our local content requirements. It's under the regime of Dema. Dema is one of the main installation companies. We have used Dema in as well in North [ Taiwan ]. I worked even with Dema in 2008 to 2012, another German project. So it's a well-established, well-known contractor which teamed up with the state-owned steel company, CSBC, whereas well our pin piles are produced. And this vessel was built in the last years, launched mid last year. And has installed in another wind farm, 31 of these jackets similar to others, a little bit smaller. And they did it over the wintertime because the jacket supply was slightly delayed. And they finalized as well last week. Dema announced that they did a good job and it's done. And I can confirm they had as well no ramp-up phase. Why they did not have a rent up phase even in a new vessel because if a sister vessel called ARIN, it's the same vessel. It's a copy of this one. which is in operation in Europe and U.S. since some years. The team has been trained on the vessel. On top, Dema has a simulator as one of the only company, which has a full simulator to run and train the personnel. How we installed the pin piles. We have used this very big yellow frame, you see there. It's in 2,500-tonne heavy piece of equipment. And this is 3-legged frame [indiscernible] installed on each corner, we install later on than the piles, and this is placed for seabed and then the pilots are piled in. It's an equipment which was as well developed for us, which fits our footprint of the jackets. It has passed the acceptance test and all the testing in Vietnam where it was produced as well by PTSC, our fabricator for the offshore substation. So it works well. Everyone is working here hand in hand. And this is meanwhile picked up by Green Jade in Vietnam in is only way to support our installation. Yes, that's -- oh, we have a video, Sorry, I missed it. We view of the load out. Here you can see the load out in Korea of our produced pin piles as mentioned, 3.5 meters long, roughly between 75 and 95-meter long and 3.5 meter in diameter. These pin piles are all designed for the use per site. So each site, we have done proper soil investigation, we have done and analyzed. We designed each pile to the optimum in regard of length and as well in regard of stability. And the low dose happened earlier this year. They are now shipped to Anting, which is a harbor in the south of Taiwan, close to our site and they are stored interim for use in spring time this year. So it is -- shows only that we are meanwhile in full operation, even we only have closed financial close in September, but due to the support of our shareholders, we have started fabrication of all this stuff a year ago. Thank you. I hand over to Jens.

Thank you Tim. Good morning, everybody. I'm really pleased to be here to do a presentation of the Baltic Power project and the progress we have at the moment. And as mentioned, my name is Jens Poulsen, and Mike already gave input to say my background. But my first offshore wind farm with Erste, the Golden project in the German waters, where I acted as EPCI Director. So at that time, I was responsible for, I would say, all the technical design, but also in the procurement. If you look at Baltic Power, better push the button. Yes. Thanks. The Baltic Power is a 1.1 gigawatt project in the Polish Waters or the Baltic Sea. That's it called. And it's operated as a JV between Northland Power and PKN Orlen. There is a large and huge energy and oil gas company in Poland. The way we operated it and as we agreed in the very beginning when we established the JV, were that we will take the benefit from each partners. So Northland is bringing technical experience, commercial experience, while our partner is bringing local knowledge, PKN Orlen is 30% owned by the state of Poland. So therefore, they also have a strong influence, securing permit and securing all content so we can secure the progress for the project. If you look at the total costs for Baltic Power at CAD 6.5 billion, and it's fully funded through our successful financial close last year in September. If you look at our construction schedule, you will recognize that it's somewhat different. We don't have winter breaks, we like to continue construction and not have breaks, but that's because it's a very different water we operate in. So we can operate all the way through winter. We have much better winter conditions, so lower wind. And the weather days, as you might be familiar with, when you're doing construction, so these are the days where you cannot operate is much, much less during the winter time compared to also the North Sea in Europe. By entering the construction phase, we have started fabrication of all main components somewhat behind what Tim just showed us, we are at 10% as mentioned, but it means that we have started all fabrication of foundations to 2 offshore substations and all the cabling and we have started construction of the onshore substation plus the operations building. To put a flavor on some of the key milestones we are looking ahead of us in the next 2.5 years, then we have kicked off all main contracts back in October, shortly after financial close. We have -- we will start the offshore installation Q1 '25, and that will first be installation of the foundations followed by cable installation, combining all the foundations in the wind park, wind turbines and finally, the 2 offshore substations. Commissioning is planned to start Q1 2026 with planned first power shortly hereafter so in first quarter '26. COD schedules so to finalize the full wind farm end of Q2 '26 with a final handover to operations. If you look at the layout, you will recognize that it looks very similar to what Tim just went through. So I'm not going to repeat everything Tim mentioned. But the main part or the difference you can see is the foundations. We are utilizing monopiles and that's both for the 76 turbines, but also for the 2 offshore substations. And the reason for using monopiles is, first of all, it's cheaper. So we have different conditions. We have water depths of between 25 to 35 meters, where it differs in Hai Long. At the same time, we don't have, let's call it, fund [indiscernible] and a, you would say, huge impact on the project. We have a site with a good average wind speed, meaning that we can utilize the monopiles for the installation. The main vessels we are utilizing is also a bit different. So the size of the monopiles is 9-meter in diameter and 80 to 90 meters long. So what you're going to do is you opened the monopiles and then just it sounds simple. But you have a vessel, you jack up on field X so you can control it, and then you hammer the monopile into the soil approximately 40 meter. All steel cut of the fabrication work has commenced. And the 2 offshore substation is expected to be fabricated and finalized Q3 '25 whereafter installation vessel will install them October the following months shortly after. The wind turbines we are using is Vestas, and that is the latest 15 megawatts, and that is designed on the previous V164 platform with similar to the story so for Siemens has been produced and operated in a lot of previous projects. The [ type ] certificate was secured in December last year. And in December, and [ this year ] production has already started. And we will not be the first project. So we have a project that will start installation of these turbines 3 months earlier than us. So we foresee that we will have the upside of all the learning of ramping up for installing a new type of turbine. Then there was mentioned a spider web before. So that's why I brought you can say this drawing to give a flavor on how the layout looks for offshore wind farm. In this case, Baltic Power. You can recognize all the white dots. These are representing each of the turbines. We have the 2 offshore substations and we have the export cables leading from each of the substations to shore. And the reason why we have 4 cables is to have the possibility if we would have failure in one of the cables, then we can run approximately 75% of the production on one cable. So that gives a good backup. The cable is running all the way through to shore where we will have onshore export cables leading the main to the onshore substation. One comment on the layout, you will probably say how have you managed to deliver this layout. It does not look very structured. And if you compare it to one of the early offshore wind farms, it was really straight lines when you install them. The reason why it looks as is, is because you have main wind directions for a wind farm. So you do the design and optimize it with the maximum output effect with the minimum of losses. So there have been a lot of design behind this layout. So it's not a coincidence. It looks like it does. And at the same time, you also look into that if you have a single turbine, then and you have the wind speed coming from here, obviously, that would block some of the wind for the next one. So that is the reason why the layout looks like it does, and it's optimized as far as possible. I would also like to share a few pictures, not as interesting as Tim's, again, because he is a bit further with production, but I would like to start to share the first picture of the onshore cabling and the cable we are looking at is being produced in total of 30 kilometers and we -- has a diameter of 30 centimeters. At the same time, we're also producing the offshore export cable where we, in total, we produce 120 kilometers, and we have already produced 3 of those. The Inter Array cable, so from the previous picture, all the lines you saw between the turbines leading into the onshore substations, we will produce 76 cables in total with a total length of 125 kilometers. Next picture is from Steel wind in Germany, where we produce all the monopiles. So the 76 for the turbines and the 2 for the substations and the section you're looking at is the first part of the installation with a [indiscernible]. If you look to the left, it can be a bit difficult. But there's actually sitting at [indiscernible] there finally we were connected to what we call a transition piece so if you have seen a turbine normally would see the monopile, you will have what called the transition piece and then you connect the turbine on top of it. And to give an idea with the 76, each monopile will consist of approximately 20 cans. So a can is each of these sections. So we're going to produce more than 2,000 cans in total to fulfill the all in all, 78 monopiles. Next one. That is. Next one, I'm cheating a bit. This is not how our future operation building is going to look like. It is how it's going to look like, but it's not how it looks like right now because we have just started the construction of the building. What's worth to mention here is that it's going to be approximately 25 kilometers from the offshore site. So that's where we're going to operate the wind farm in the next 35 years and we can enter this building with what's called crew transfer vessels. So smaller vessels that can carry around between 12 and 24 people to do service and operate the wind farm in generally. And we, as a construction project will always start -- already start utilizing it in spring '25, summer '25, where we will install the marine coordination and the marine coordination is the control for all the vessels that are going to enter the offshore site for installation. Furthermore, we will operate all the commissioning of the wind farm from this location before we finally going to hand it over to operations for the next 30 to 35 years of operation. Last picture is from our onshore substation. And as you can recognize, the 20% difference between Hai Long and Baltic Power is very easy to see. This is approximately a couple of months back, heavy winter in Poland. What that is definitely important to mention is that we were a bit concerned with the winter we have had whether the contractor could operate in these conditions, but they are still fully on track as planned. So it's very clear that they used to operate in it. As mentioned, it's located at 8-kilometer in shore where we go through a forest where we need to take trees down for the offshore cabling. And it will be fully concluded Q4 '25 to secure the grid connection for '26, so we can have the first power again first quarter in '26. At the same time, we are across Europe, curly fabricating all the electrical components, power pendants, et cetera, breakers and this will all start arriving to site autumn this year to be installed in the future buildings. At last, I would like to show a small video from a drone. So you can see there's a bit more. This is only a few weeks back, and now you can see the winter conditions has changed to -- yes, I want to call it mut basically, but still, we are happy about the progress, even though obviously, it's different conditions. In a difficult conditions to operate in, but clearly, we are entering into spring where we expect it to be modest, easier. I would like to hand over the stage to Michelle. Thank you.

Okay. Good morning, everybody. I'm going to take us through the status of construction for our Oneida battery storage project. So Oneida is a 250-megawatt, 4-hour battery storage project. And as some of you might know, we talk about batteries a little bit differently than we do about generation. We have to talk about its capacity but also the amount of storage time that is installed. So for Oneida, 250 megawatts, times 4 hours, it's about 1,000 megawatt hour project. It is located in Southwestern Ontario and more specifically in Halderman County, about 45 minutes outside of Hamilton. The project currently has a 20-year capacity contract with Ontario's independent electricity system operator, the ISO, and that was actually a bilateral process for this project. And that was pretty significant because it set the stage for all subsequent procurements in this province. You might be familiar with the expedited RFP or long-term one RFP. That was all built off of the contract that was done on Oneida. So from an ownership perspective, Mike walked us through our partners, and I would really say we have a complementary set of partners on this project. Northland, we are a 72% owner. Of course, 6 nations of the Grand River Development Corporation. This is actually Canada's largest indigenous Economic Development Corp. Also, Aecon, as Mike mentioned, is not just our contractor, but a co-owner, which we feel is really good in terms of alignment. And then, of course, the original developer with the vision NRStor. So this project total cost is about $800 million. And again, that is fully funded. We hit financial close back in May of -- that's off my decade of 2023, and the debt for this project was done through the Canada Infrastructure Bank. Total -- I guess what I'll go here is I'll just make a comment that this project is really going to be the largest in Canada, one of the largest in North America. And for us at Northland, it's our first and so we're pretty proud of all of our teams that have been working to make this project a reality. I'll talk a bit more about construction and status. But ultimately, it is putting to test and making the energy transition a reality. Construction is progressing well. And on that front, I will do a bit of an overview of where we stand from a time line perspective. So right now, what's going on in side is a lot of civil works. So these projects have a lot of grounding or excuse me, leveling of the ground to make it flat and what we're doing right now is in selling a heck of a lot of concrete foundations. So each one of these batteries has got to come on site and sit on a flat foundation. We've got medium voltage transformers and high voltage transformers, which, again, are really heavy and need to be put on a solid foundation. So we've got about 140 Megapack foundations. Out of the 140, as of yesterday, we had about 113 complete and ready to receive batteries. From the medium voltage transformer perspective, there's 70 of those foundations, 55 are currently installed. And Megapack actually arriving in a couple of days from now, which is Thursday. So 30 will have our very first Megapack batteries coming on site. So we're building a lot of foundations. We're about to receive a lot of batteries. The medium voltage equipment and the high-voltage equipment will all be on site this summer. And ultimately, all the installation of that will come together by the end of the year, so that through the first part of 2025, we are really focused on testing and commissioning with Tesla. Overall, I'm really pleased with the status of construction and our contractor Aecon on this project. Overall, I think Mike had up on a slide, we're about 45% complete. But as of the end of February, we're actually just over 50% -- 50% to 55% complete on project. Okay. walk you through the main building blocks of a storage project and make it a bit interesting here. So I'm going to start from the end. As the way I think about it. So we start with the battery pack. So each one of these battery packs, as I mentioned, is arriving on site this Thursday. They're not a lot to look at. So the bottom left-hand side of screen is just like a long light shipping container. And as mentioned, those need to be sort of installed on foundations. And so 278 of those will be arriving on site. The foundations we have 140 Megapack foundations. And if you do that math, it's about 2 per foundation, so they sit beside one another. I'll then move to the medium voltage transformers, again, there are 70 of these. They each have their own fan foundation. And then, of course, you have to connect it all with cable. So we've got the conduit on site being installed underground, and the cabling will come on site the spring summer for ultimate installation. In addition to the medium voltage transformers, we've got our grid substation transformers, there's actually 2 of them, and they connect to 2 separate 230 kV circuits. A bit of that sort of redundancy but ultimately for connecting into the Hydro One grid. This site is immediately adjacent to Hydro One's Jarvis transformer station. And I think that's the other important thing about batteries is you got to take a really good site that you can obviously build and have flat but the real magic for batteries is the locational value. So what does that mean? That means it's really resilience for the grid. So when the grid has too much energy, you want to be able to absorb it and you want to be able to put in a place of the grid where that's going to be the most impactful. On the flip side of that, as we always hear, when our air conditioners are running in the summer at [ full tilt ] and the grid needs more energy, these batteries can be dispatched. And so as a resident of Ontario, I can say that I'm really glad to be building this project not Ontario will be building more. So we're going to make this real now with some pictures, and I'll try not to stand in the way. So here is a crew at the end of last year, installing one of the many megapack foundations. I will mention that Aecon, our subcontractor has a partnership with the 6 Nations of the Grand River Development Corporation [indiscernible] and what they do is employ -- it's a partnership jointly owned. I think 51% by the First Nation. But the point here is that we've got quite a few First Nation staff that is on site building this project for us. Here's a really exciting picture about conduit. So this is all being installed underground. Eventually, the cabling will be run through that, but it's important to get this done properly and have it protected because all of the electricity runs through it. Here's a more finished product. As you can see, on both sides of here, these are the foundations for the Megapack. So 2 of those go on each one of these. And the center is the medium voltage transformers. And these are important because we like to step up the voltage so that when the rest of the cabling on site, we minimize losses within the project site, So these are pretty important. And then here, this gives a bit of an aerial view. So again, you'll see each one of these large rectangular items is a megapack foundation, 2 megapacks per foundation. Each medium voltage transformer takes 4 megapacks. You got a 2 on the top, 2 on the bottom and repeat and repeat and repeat again. And then here, lastly, this is just an overview of the whole site. All in all, it's about 10 acres. It doesn't take up a ton of land. But you can see how grading and the civil works is really important. And that big open space in the middle is actually where the substation will be in those 2 high-voltage transformers will be ultimately connecting to the grid. There's some transmission lines just to the south of here. So I, too, have a video, and we'll play that now. So the phase that we're about to enter into right now is one of a lot of material handling with all the batteries arriving on site. So it was really important for us to make sure that we had the foundations ready. You don't want to be moving these batteries several times, you want to take them off the truck when it arrives and place it on its forever home. See some of the [indiscernible] that's going on. Also important to make sure that the drainage and the storm water management on these sites is done properly, so you don't have ponding in wrong spot. I get excited looking at this, but there's just a bunch of concrete and shipping containers eventually. So that's really it for me. I believe we are now at break. I'm going to turn it over to Dario just give a few words on that. Thanks very much.

All right. Thank you, Michelle. I hope everyone's been in joint presentation so far. We're actually doing really well for time. So we'll take a 15-minute break. And then after that, Adam Beaumont, our Interim Chief Financial Officer, will take us through a financial update. So please free up to get some coffee in the back or use washrooms. [Break]

All right. We're all back here. So I'm going to pass it over to Adam Beaumont, who is going to take us through financial update section.

Thank you, Dario, and good morning, everyone. Thank you very much for being here today with us. My name is Adam Beaumont. I'm acting as the Interim CFO for Northland. And today, I'm going to provide you with 3 main updates. The first one is an update on our commitments since our last Investor Day. The second is how our balance sheet is in great shape. And our finance and risk management strategy, we really think is positioned well for the future execution on the construction side and future growth. It's not even exciting. I don't have as many pictures and videos here, but we want to make sure that we're letting everybody know that what our fundamental practice is, is to lock down the key risks and create opportunity for future upsides, which you'll hear from -- in a little bit. And lastly, what we want to talk about is providing an outlook on our 2027, just getting a little more into the details and why we're really excited about the cash flow that will come to the business. First, to quickly recap on our 2023 financing objectives that we disclosed at the last Investor Day. And I won't get into the details because we did provide an update on these on our earnings call 2 weeks ago, but what matters and what's important is that we executed on our financings and our commitments that we set out last year in a pretty challenging environment. In addition, we also onboarded new business unit CFOs, which will align with the new structure and make sure that we're more focused as a finance team by technology and closer to the projects. We also undertook the largest hedging and insurance programs and campaigns on these projects in Northland's history, which we will further give us confidence that we can deliver on the returns that we set out to achieve. And through closing the multiple transactions, we expanded our relationships with many new and existing financial partners including hedge advisers, insurers, investment banks, export credit agencies and asset-level investors that are going to be critical for Northland going forward as we are -- have a very capital-intensive business. We are proud of the accomplishments in 2023, and we look forward to 2024. Prudently managing our balance sheet and maintaining financial flexibility will be key -- is key to our success, as Mike alluded to. We have the liquidity available and we have an investment-grade rating, which is not common for independent power producers, but we believe is a real seal of approval of the quality of our business. We financed our projects, our large projects through nonrecourse asset-level financings, which drives discipline and undermines our risk management practices. The project finance debt typically amortizes over the life of the revenue contracts and an independent set of eyes ensures that we build our projects with the utmost quality. Project financing also enables us to capture future optimizations. As Mike noted, especially when market conditions are a little more volatile, lenders really require you to make conservative underwriting assumptions so that when the market conditions improve or projects are further derisked, you can see upside through refinancings or potentially debt re-profiling in the future as time goes on. This funding strategy at the project level drives a prudent usage of corporate debt and also mitigates our exposure to interest rates. As you can imagine, over the last 2 years, with the high interest rate volatility, Northland really hasn't been impacted from the corporate interest side, which others have. At the corporate level, we take informed and measured risks and maintain an operating guardrails to ensure that we have ample liquidity in the event that there are material impacts to any one of our projects. With such a large construction program underway, protecting our balance sheet from any unforeseen risks is our top priority. The 3 projects under construction have a total cost of $6 billion. We outlaid this exact -- pretty close to the exact chart at our investor update in the fall. And what it shows you is the total spend of that profile over the years. And as a reminder, we fully raised all the equity that we require in 2023. And for 2024, the portion that you see showing there is the equity contribution to the project level for Hai Long that us and our partners, Mitsui and Gentari, will be making shortly before -- sorry, before first draw, which is expected very shortly. Going forward, all the project costs from these projects will be funded by project finance debt and also the precompletion revenues on Hai Long, which will be starting to produce power in the second half of 2025. The $1 billion of precompletion revenues from Hai Long are because of its size and length of construction. And we'll -- the cash flows will be generated -- the cash flows that will be generated prior to commercial operations will be used to fund the project. Banks, again, require us to be very conservative in our assumptions from a time perspective and as well as just the wind profile during that time. So as you can imagine, as we've proven on our Gemini project, there could be an opportunity for further upside. Baltic Power also has pre-completion revenues, but it's much smaller and for a shorter period of time, as Jens alluded to, in terms of the construction schedule. Turning to our risk management practices. We have a comprehensive and effective hedging program in place to stabilize our cash flow, preserve our project economics and mitigate key market risks. The goal is to lock down risk and then look for opportunities for upside. Today, we are focusing on just the 3 projects under construction, which I will touch on quickly. From a foreign exchange side, there's 2 risks. There is the risk for foreign exchange changes on CapEx and also on your operating distributions. For CapEx, almost all of our construction costs are matched to the currencies of project financing or hedged over the construction period. For the operating cash flows, similar to our 3 operating projects right now in Europe, we look to lock down and hedge effectively 80% of the cash distributions that will be coming back to Northland for the longer period. On the interest rate side, we are fully hedged on Baltic Power, and for Hai Long, we are hedged for a 10-year period, which based on local market conditions, that's what you're able to do. And obviously, there's another opportunity for some future upside as you look to roll the hedges moving forward. And lastly, on Oneida, we have locked in all the interest rate costs over the life of the loan. We are very pleased with our hedging program. It takes a lot of work from our treasury team, and we would like to focus -- as we focus, really, to protect the returns of our projects. We think that our lenders, our credit agencies and our shareholders really like this as well. As part of our '23 guidance that we issued at the end of February, we announced our 2024 financial guidance. Adjusted EBITDA of $1.2 billion to $1.3 billion, adjusted free cash flow of $1.30 to $1.50 per share, and free cash flow of $1.10 to $1.30 per share. Approximately half of our EBITDA will come from Offshore Wind, which is consistent with the past and also looking to the future. On this slide, we wanted to provide a bridge of the major factors contributing to the year-over-year change in free cash flow. The biggest change is due to the lower amount of transactional and hedge gains that we experienced in 2023, as last year, we sold down, as Mike alluded to, a number of our asset -- our development assets, and we don't guide to gains going forward in the future. This is offset by the contributions from a full year of operating from our New York onshore wind projects that reached full commercial operations in the fourth quarter of last year, and a reduction in our development expenditures which we, as Mike alluded to, will be focused on construction execution and our core markets. On one of the prior slides, we talked about how Northland has significantly grown our EBITDA over the last 4 years. And looking forward, with secured and fully funded projects, we are looking to increase our EBITDA further by 40% or 7 to 10 CAGR. But we also wanted to make sure people didn't expect it all to come in 2027. We have some near-term milestones as well, which, of course, we want to highlight. In 2025, Oneida will come online -- is expected to come online, pre-completion revenues from Hai Long are expected to start in the second half, and as a reminder, although we're going to be producing the first turbine will go in, we'll start earning a return and are having earnings, but because the cash flow is being used to fund the construction of the project, it will not be reflected in our free cash flow definition. In 2026, Baltic Power is expected to be fully online and Hai Long will follow shortly in 2027. In this forecast, we assume Nordsee One will earn market revenues as the original subsidy expires in 2027, but we hope to be able to contract that cash flow for a longer period of time. Of course, this forecast is only with those projects in construction. As Mike alluded to, we'll look to opportunistically potentially add to this forecast. In addition to the meaningful cash flow that will come by 2027, we wanted to also highlight on 2 key benefits. Number one is the geographical diversification. So today, 50% of our EBITDA comes from 1 area, the North Sea, which is subject to the wind conditions and any grid issues in that particular area. By 2027, although our exposure in offshore wind will increase to approximately 60%, we'll have 3 distinct areas, being the Taiwan Strait, the North Sea and the Baltic Sea. We think that this will add to the quality of the cash flow. The second benefit is the contracted revenue. With Oneida having a contract for 20 years, Baltic Power for 25 years, and Hai Long for 20 to 30 years, that will add a significant amount of contracted cash flow, which will double our weighted average PPA life from 8 to 16 years. Again, by 2027, once these projects are expected to be online, our EBITDA will be more geographically diverse, but also have a much longer contracted horizon. Turning to my final slide, we wanted to address the payout ratio expectations for the next 2 years. If you look at history, and those might remember this slide from many, many years ago, we experienced elevated payout ratios in 2011 and 2015, when we had very large construction programs relative to Northland size. This was last experienced in 2015, when we were constructing the Nordsee One and Gemini projects. Given we raise the capital upfront, our payout ratio was elevated, until the cash flows from these projects came online in 2016 and 2017. Over the next couple of years, our payout ratios will be elevated again, largely reflecting the projects in our current pipeline under construction, which until 2026 and 2027 will improve as the projects become fully operational. Despite this construction pipeline being significantly larger than those in 2015 and 2011, the payout ratio will not be as high, reflecting Northland's larger size. So turning to 2024, we will focus to execute our business plan, continue to maintain financial flexibility in our funding tools, and as you have heard today, provide you with further updates on our construction progress. We definitely look forward to doing that with you. And I will pass it over to Mike for concluding remarks.

Okay. We spoke about the $16 billion in CapEx that we had to fund for these projects, about $11 billion in project debt, just embarrassed Adam for about one moment. He's here as the interim CFO today. Last year, he was Head of Capital Markets for Northland. So all of that -- all of that was led by Adam last year in a very challenging market. And for everybody at Northland, as soon as we heard Adam's voice on a call, saw a text and e-mail from him, we knew that he was on top of it, and we had absolute confidence that he was going to deliver, and he did. So just to wrap up the presentation today, as we said, we think Northland is coming out of 2023 in a stronger position than when we began. We've got 2.4 gigawatts of growth locked in, which will deliver around $600 million of incremental EBITDA by 2027. Top 2 priorities overall, executing on this construction program, bringing everything in on time, on budget without incident, and also maintaining our strong financial position throughout. We see some really strong tailwinds emerging. We talked about declining inflation, stabilizing supply chains, but the biggest one is rising power prices and the demand for power increasing. And we really think that over the next decade, what's going to differentiate how fast a country, a province, a state grows is going to be their ability to develop the necessary power generation to facilitate that growth going forward. It's kind of like 130, 140 years ago, with the initial industrialization of Canada and the U.S. I think it's going to be the same in Canada and North America and in Europe going forward. So for that, the world is going to need a lot more renewable energy, a lot more power facilities, a lot more large-scale power facilities. That's what Northland does. We have the engineering talent, the commercial talent, the finance talent, the project management talent to make these projects happen. And we are really excited about, first and foremost, delivering these 3 projects. Then beyond that, all of the growth that we think will be in front of us. So we're going to take a quick pause and reorient the stage so that we can set up for Q&A. So probably about 2 minutes or so. That's good, Dario? Okay. [Break]

I guess everybody knows where it was. Okay. So Vic, you're going to start the questions off. Are you going to start off, Dario?

Yes. I think we can open up to the floor for questions. Before you ask a question, could you please introduce yourself and mention what firm you're with, and then you can go ahead and ask your question.

I'm Rupert Merer from National Bank. Tim, if I could start with you. Looking at the schedule for Hai Long, you've laid it out well with winter buffers. How flexible is that schedule? Or how flexible are your contractors? If you're running ahead of schedule, can you accelerate things easily? And conversely, if you fall behind, you hit the winter and you're not quite up to speed, how easy is it to catch up?

Yes. Thank you for the very good question. I mean, I looked on it, I thought maybe we have built a little bit too much buffer in it. Nevertheless, it is our strategy to construct these wind farms in a very solid and a very conservative manner. And all the setup is that our vessels are contracted for 2 to 3 years, depends on, for example, the installation vessel is contracted for 2 years, even if we only need the vessel for 109, 110 days per summer season. So we have time. We will lay it down in wintertime to reduce cost. But if needed, if, for example, one foundation would be delayed, we can continue in wintertime. The similar is it with cable installation and as well with sea turbine installation vessels. So we have the vessels secured and we are flexible. On the other side, we have the supply chain side. As mentioned, we have the 2 offshore substations. They have been in construction for now 15 months, and they are nearly done. They are at the moment in hot commissioning. This means all the equipment is in. They are in the stage of finalizing the testing and then they are ready for sail out. The jackets, you've seen the first one, sailed out last week. The other one is waiting on key site for installation. So this is all built up in a way that we have a good buffer to be flexible on one side and having as well the vessels available on the other side.

Can I ask a follow-up. Is that buffer, is it only because of the weather, the severity of the weather? Do you have that buffer versus Poland? Or is it in part because of the complexity on the foundations as well?

Both. On one side, we have this complexity because we have the local content suppliers, and we have the international suppliers. This gives us as well flexibility because both started at the same point in time, so if one would be delayed, which is not the case at the moment, we could use material from international if the local supplier would be late and vice versa. But nevertheless, we have instead of 1 foundation supplier, we have 5, we have 2 for the [indiscernible], we have 2 for the jackets and in the jackets, there's an additional one, which is so-called [indiscernible], comes from Netherlands, they're meanwhile done, but it was a relatively complex construction. And this, as part of our mitigation strategy, we are building buffers in, and having on the other side an early fabrication to be flexible.

Nick Boychuk from Cormark Securities. So Mike, how do you think about maximizing the value of asset sell-downs, kind of using ScotWind and the potential to sell that down by another 25%. When is the ideal point in the process to do that? And how do you think about maximizing it?

I think our view on sell-downs has changed a bit over the last 2 or 3 years. If you look at Hai Long, we were waiting to sell-down, at least close the sell-down until financial close. And if we look back at 2023, given how market conditions changed through the year and what that did to the timing of financial close, it really did ramp up the exposure pre-financial close to Northland and our partner, Mitsui, on that project to a level, which I don't think we would want to repeat. So one of the lessons learned coming out of 2023 is to maybe look at doing our sell-downs in 2 stages, like we're doing on ScotWind. So we did a relatively early sell-down on ScotWind. We managed to recover the cost that we have paid for the leases, all of our DevEx, so we're able to recycle all of that. And then we will likely do another sell down, as I said in the presentation, in '25, maybe '26, once the project is further derisked. And on that second sell-down for an additional whatever it is, 25%, we would look to get more of a premium as well as recovering some sunk costs.

Sean Steuart of TD Securities. Mike, I guess by design, you haven't referenced any projects beyond the 3 big ones you're working on. You've got adjusting for La Lucha, almost $800 million of available liquidity. So you've got a nice cushion. Can you talk about advancing onshore renewables or storage projects beyond Oneida? The cadence for potentially bringing those types of projects to fruition and any areas that offer better relative potential?

Yes. I mean, when you look at where we're going to source new cash flow, incremental cash flow beyond those 3 projects we talked about today, in the next few years, it's going to be primarily from onshore renewables, right? So what we're doing in Canada, New York State, Spain. So on those projects, some of them are in a position where they could go soon. But we are going to make sure that we move forward at the right time, both for the projects, but also for Northland, and where we're at in terms of executing on particularly the 2 big offshore wind projects. We want to make sure that the first priority is the resilience of the company at the corporate level, but then we would be able to move quite quickly on some of those other opportunities, particularly in Alberta, and possibly in New York State as well.

Can you touch on Alberta? I know many of your projects or some of your projects that are advanced, but in light of the news last week, how your pipeline there fits into the overall scheme?

So I mean, I'll turn it over to Michelle because I mean, I think most of our projects there, at least the majority, had the AUC permit in place. The announcement for us is less about enabling our projects because they were already in pretty good position. It's more about a signal of what the government's intent is with respect to renewables, and it was in our view, I think, a very positive signal.

Yes. That's right. So as you recall, we made a transaction at the end of 2022, where we have quite a substantial presence in Alberta. And what was nice about that is, as Mike said, they have the AUC generator permit, which is the important thing and the announcement that happened over these past couple of weeks. So fortunately, because we have all of that, all the new announcements are not retroactive to the majority of our pipeline. And so what we're looking at this next few years is to actually bring those to fruition. Similar to what Mike said, right, we have to use a prudent growth approach, ensuring that our priorities of execution and resilience come first. And so certainly, Alberta will play a role in that.

It's Nelson Ng from RBC Capital Markets. So first question is for all 3 projects under construction. It sounds like you have all the risks buttoned down quite well, but for 2024, what do you see as the biggest risk to the schedule and the budget?

I can start from my side. Obviously, we started fabrication on all main components at the moment. And therefore, we have ramped up the team, both when it comes to quality, but obviously, also in HSE to make sure that we get off on the right foot and we follow the program as planned. If I look at the overall, it's a new market where we are not familiar with the TSO. So the grid connection, that's a part where always you will say, a bit concerned and following it closely because it's outside my control. So that's really where we are following closely. We see that they build as planned, and obviously, get all the insights through our partners all in to make sure that they are going to deliver meeting the program as agreed.

On Oneida, I'd say 2 things for 2024. As I mentioned, there's a lot of material handling that's about to happen with all these batteries arriving on site. So a big part of that was making sure that the site was prepared to receive them. So I think we're in a really good position that way now to focus on health and safety to make sure that all of that happens seamlessly and only -- ideally things only get placed once. That's the first thing. I'd say, the second item is around transformer materials that will be delivered this summer. We've got a whole -- we, ourselves, do as well as our contractors, Aecon, have a whole expediting process where they are in the factories where these things are being produced, so we can see, touch, feel, be present for the testing. So that when they eventually arrive on site, they do so on time and with the quality that we expect them to be.

From my side, we -- as mentioned, we will install this year the export cables and half of the inter array cables. And the cables has not passed, so far FAT other than one of the export cable, so we will start. But it's a risk that if they fail, it's 1 to 1 million, I would say, that one of these cables blows up, but it blows up in the high voltage test. But nevertheless, we have quite some flexibility on time wise. So it is more a question, can we get everything this year or we have to move something into next year, maybe utilizing as well winter period.

And the next question is more for Mike and Adam. In terms of your 2027 outlook, it doesn't include any new projects, but it sounds like any incremental projects will come from potentially Alberta and New York. So I guess, if you were to move forward with any projects in Alberta and New York, is the expectation that you would do sell downs to internally fund projects or do you already have? Or is it to just draw down on your available liquidity to fund any additional growth?

Yes. No, I think as we said, we're only going to be pursuing opportunities that's the right one in terms of the different profile in the market. So I think, likelihood is we do have multiple tools in our funding chest, including the revolver, which could be part of that. So I mean, it will be a TBD at that point in time, but the likelihood is that is correct.

The opportunity in the next 2 or 3 years, and we put the slide up deliberately on capital recycling is really to take a look while we build these 3 projects out at our portfolio globally and look at how we should realign that to where we really want the company to be in 2 or 3 years. First step certainly is what we did with La Lucha, what was announced yesterday, bring some capital back into the corporation, pull it out of a market that changed dramatically since we entered it. But there's other decisions that we can make too over the next 2 to 3 years. So the first place we would look for capital for new growth would be funds that we have on hand and capital that we could recycle from our existing facilities.

Okay. Maybe we're going to take a couple of questions from our virtual audience before we go back to the floor. So we have a couple of questions here. So first one is from Prab Sidhu from Leith Wheeler Investment Counsel. Are there still other buffers added into the Baltic Power schedule since there aren't any winter buffers?

Yes, there's absolutely planned float. And I would say, all projects also known in Europe, you will not see having winter buffers. It's special for Taiwan. I would say that's not normal for a wind farm built in Europe. But yes, we definitely have float building and we constantly also challenge ourselves because, obviously, if possible, if we can accelerate anywhere, we're going to do it. But obviously, we -- first of all, we want to see that we get all the companies fabricated and then we can start playing, optimizing further, potentially. But to make it short, yes, there are necessary float, and I'm confident that we can meet the schedule Adam laid out.

Okay. Great. Thank you. Thanks, Jens. Okay. This one is probably for Michelle. Do you think the new rules in Alberta provides you with some barriers to entry relative to new players that may try to enter Alberta as a renewable player?

Yes. So just to take that for a second, it's become restrictive in Alberta. And I just want to take a step back that most jurisdictions that see a large build-out of renewables do have this inflection point where they need to be more deliberate about what they put and where, and some of the rules around that. So I would say part of what happened in Alberta is not unique. We see that in other jurisdictions. As it pertains to our portfolio, I would say that, there certainly is an advantage to us being through that permitting process, and in particular, the AUC generators permit. And I think it will make it more difficult for new projects that haven't received their permits. So in a sense, I think I'm pretty pleased with the status of our portfolio and excited to -- what's next out there.

Great. Okay. We can go back to the floor.

Mark Jarvi from CIBC. In the presentation today, you guys talked about completion of projects and gave percentages, which are a bit different than how you framed the CapEx or budget timelines in the October presentation. So you talked about making progress. How should we then evaluate going forward here? Is there a number that we should look for at the end of 2024 in terms of project construction or percentage of CapEx to be completed on the key offshore wind projects?

Do you want to take that up?

Yes, absolutely. So no, I think what we wanted to do is make sure we're giving the right benchmark to really provide how much the projects have progressed. And I think with the challenge with the actual spend to date is sometimes, you're making material deposits for turbines or things which are skewing the numbers, which are not really reflecting the true milestones that are being achieved. So I think in that scorecard that Mike presented, that's kind of like our playbook of how we want to provide an update on our progress moving forward, and that which would be the percentage of completion for each of the projects. And those numbers that we're showing on the slide were actually as of December 30 of last year. So obviously, we've made some improvement since then already.

Okay. And then, Mike, maybe this is for you. You made a comment that you didn't think the share price reflects some of the value that you're creating here in the current assets. And so I'm just curious would be -- do you stay patient here as you execute and look for that recovery to take place? Is there other conversations that you or the board have been making to try to highlight the value of the portfolio of your business and development pipeline that you see today?

Well, I mean there are certain things outside of our control, macroeconomic conditions that will have some impact on all of the players in our sector. So that's outside our control. In terms of what we can do, I think we need to communicate clearly on both the value that these projects will be bringing to Northland over in 2025, '26, '27 as they come online. And number two, what we did today is really take investors through the milestones as these projects get derisked. So as they approach commercial operation and really get them -- get the market to understand how the risk is diminishing and how that cash flow is approaching. And then the third thing is we do have to start talking about a bit more about what's next, where Northland is going next and giving the market a better understanding of that. We've got a good story to tell. We were very focused on delivering on the financial close in the Gentari sell-down last year, and getting these construction projects launched. But moving forward, I think we do have to allow some airtime to explain what's next too after these 3 projects.

Is there anything when you think about optimization of the assets to your portfolio where you think highlighting the value of certain assets that maybe don't get full value in your portfolio by doing a partial sell-down or something like that, is a market to the market to show the value across your asset base?

So I mean, we wouldn't -- put it this way, there's a couple of things. One is in terms of optimizations on our current facilities. That is something that truthfully 5 or 10 years ago, maybe Northland didn't look to as much as we are now. There's always another opportunity that was bigger than what we had. But as we look at where our facilities, some of the facilities are located, we do see some real opportunity to optimize them. So on Thorold, for example, we've got a 30-megawatt upgrade last year on a bilateral basis with the system operator chatting at the break a bit about North Battleford, where there's an opportunity with carbon capture there. So I think what we're doing is creating a team that can focus much more on those opportunities and putting together a business plan for each one of our facilities, taking them all the way through over the next 10 years as the contracts expire so we can make sure that we not only maintain the value that we get from those, the cash flow we get from those, but ideally be able to enhance it as well. We would look at doing certainly sell-downs on development assets. If it's on an operating asset, there'd have to be a fairly compelling proposition. There's certainly, in the near term, a lot of value to Northland and the cash flow that we get from our operating assets.

David Quezada from Raymond James. Michelle, maybe 1 for you. Just thinking about the opportunity going forward for storage projects in Ontario. You mentioned that the sites need to be strategically selected. I'm curious how rare those sites are? And how do you think the competitive dynamic will play out for future RFPs for storage in Ontario?

So as I mentioned, locational value is the holy grail for storage. I would say too it's a capacity contract, right? So understanding where you source yourself on the system, it obviously has to be a benefit to the utilities. But without a doubt, I think we've seen this in the expedited RFP and long-term one, there's a lot of -- there's a lot of supply that is out there. I think in general, battery storage projects are a shorter development cycle. So I think you see a lot of early entrants that came in and were able to come in quickly, maybe in some instances too quickly. And so I think there'll be a lot of competition around that. And so I focus really on getting Oneida done and getting it done well and operating it as well.

Excellent. Maybe one more, I guess, this would be for Adam. Just on the sale of La Lucha. Any color you can provide there on how that process came about? Was it a competitive process? How competitive, if so?

Mike, do you want to comment?

Yes. I mean, it was certainly a competitive process. We ran it ourselves. We didn't have an adviser. Our lead for M&A within the onshore business unit knows the Mexican market very well. He's got a long history there. So we knew most of the players that are embedded in that market that are in there for the long term that would see value in an asset like La Lucha. And as much as all of us see some of the noise that's come out of the power sector in Mexico over the last 2 to 3 years as the current government challenged the market reforms that the prior government had brought in, there is still another story about Mexico, which is all of the manufacturing that's still moving into Mexico, global multinationals that are moving into Mexico, that have their own net zero targets that need to source renewable power, and there's not a lot of it available in Mexico. There's not a lot of uncontracted renewable energy projects, facilities in Mexico. La Lucha is one of them. So we were fairly confident that we would be able to find a buyer, and we're fairly confident that we would be able to get good value on it, and I believe we did.

Ben Pham, BMO Capital Markets. Slide 64, payout ratio. I think the key message from interpreting from this is you've had a high payout ratio before and during build-out, you'll be able to manage this next build-out. So the question is, is there a constraint on your ability to grow during that period of time? And I ask that just from a perspective that the last build out, the payout ratio was 200%, and your stock was under a lot of pressure during that time. And so how do you -- you can probably manage this, but how do you put a cap or guardrail when you think about growth and how do you manage all this growth that you want to, I guess, might double down on in your core regions?

Yes. So I mean, I can start and Mike, feel free to add in. So I think -- I mean, top priority for Northland right now is execution of those construction projects. And I think you guys have heard a lot about that, obviously, being today, but we don't want it to -- as we look forward, and as Mike alluded to, responding to Nelson's question, like we are looking for other areas to continue that growth pipeline in terms of being able to execute on New York and Alberta and continuing to grow. So I think for us, it's a balance. We're obviously recognize that it is a large construction program. But we're not going to be -- we're going to be continuing to look for different financing tools that will help us to further grow and keep that optionality open because if it is the right opportunity, we want to be there and continue to grow.

And I think, Adam, like the -- when we talk about an elevated payout ratio relative to what happened with the 2 build cycles in the 2010s, Northland was a much smaller company then. There were some particular circumstances, particularly related to North Battleford then, that really caused that payout ratio to elevate up quite high as Ben, you alluded to. You've got a good memory, Ben. And the -- those circumstances, I mean, Northland is a much bigger company now. So when we say an elevated payout ratio, I mean, we're talking about what we presented today in terms of 2024 guidance, so approaching 100% instead of 70% or whatever it was roughly last year going forward, but not going up to the same level, certainly anywhere near what we saw 10 years ago.

No, absolutely, yes.

Can I ask you to just go down memory lane, the Gemini project, I think that there's a time where you were looking at selling the grid assets like substation, bringing private equity. And just kind of looking at these diagrams today, is that something that you would think about again? Or is that even possible in the structure you have in place?

On these 2 projects? The 2 offshore wind projects?

Just more broadly.

Broadly? I mean, I have to get back in that but I don't think from a regulatory standpoint or a market structure standpoint, that would be an option available. But I don't know, Adam, do you have any more insight into that?

Yes. I mean the financings are pretty large, and there would be a whole element to that as well, which would make it tough. But it's not to say it's not off the table, but I think it would be very challenging.

Okay. I don't think we have -- oh, we have a question.

Rupert Merer, National Bank. The Canadian market seems a little less competitive than some of the foreign markets. I don't know if you agree with that. But when you look at doing developments here, you haven't talked much about doing offshore wind in this country, and it doesn't seem like we have a huge pipeline of offshore projects. Is it going to be an important market for offshore wind? Maybe if you can talk to us about some of the puts and takes of doing offshore in this country?

I mean, Canada is an interesting market. It is a relatively small market, right? And it tends to go through cycles where there's a big build cycle and procurement cycle, followed by a big build cycle, and then things kind of quieting down for a while. So the last 10 years, it was not a lot going on in Canada. But what we're seeing now in Alberta, certainly, but in Quebec, Ontario and soon in BC, is quite a lot of activity, and we expect that to continue for the next decade. So in general, we see a lot more opportunity in Canada. Initially, a lot of it will all be, in our view, onshore renewables and in places like Alberta and Ontario battery storage. So we want to do a lot more in Canada, and there's all sorts of advantages to Northland to do that at a corporate level as well. On offshore wind, there's been activity on both coasts over the last several years. I think on the West Coast, British Columbia, we withdrew from a project that we had some involvement in there. We just took a view that it was going to take a lot longer and left -- handed those assets back to the original developer. East Coast, I think, in some ways, is more interesting. It will take some time, but there's a lot of activity going on between the federal government and the Nova Scotia government to set up, and the Newfoundland government to set up procurement process, particularly around Nova Scotia off towards the Sable Island for leases there. And we're expecting that -- those lease auctions to happen sometime late 2025, maybe into 2026. But if you play that out, that is really for projects that would then FID towards the end of this decade, deliver energy into the next decade. But they could be sizable depending on what happens with transmission and how you can move those electrons back into Quebec, Ontario or into the Northeast, and what happens with hydrogen export projects on the -- in Nova Scotia as well.

The conditions be favorable for offshore there? Could it be competitive with offshore in Europe?

Good water depths. So I think it's kind of between 40 and 60 meters in depth. Good seabed conditions for monopile foundations. The wind speeds are excellent. So it's really a question less of that, more of finding a buyer and a home for a large volume of electrons, which is what you could generate from offshore wind off in Nova Scotia.

Maybe one final question, I'll show off my memory here. But remember when they were talking about offshore in Lake Ontario? Do you think we could ever see that again?

I think it will be a while if it does happen. I think what's certain is when you look at all of the states and provinces that border the Great Lakes in the St. Lawrence Seaway, there is going to be a lot of demand for power. It's going to have to be a lot of power generation built out over the next decade for -- as we talked about for manufacturing, it's more manufacturing is brought back into Canada, into the U.S. data centers, all of what we spoke about. So you're going to see a lot of demand. Some of it and a good portion of it can be met through onshore renewables. That's why in New York State, you're seeing such a big target from NYSERDA to build out not just offshore, but onshore renewables in New York State. So we see a good opportunity there. You're seeing the system operator in Ontario now talk about procurements for energy, not just storage capacity in the years to come. So there's going to be a lot of activity all around the Great Lakes. Whether there's enough land, enough space, enough social license to build out enough renewable energy and storage capacity, also depends how quickly SMRs and nuclear power happens or doesn't happen over the next decade, who knows what will happen with the Great Lakes and offshore wind? Maybe it'll -- maybe this day will come again.

Mark Jarvi at CIBC. So Mike, you talked about being selective, given the fact that you had a breadth of options, especially on offshore wind, how you walked away from North Sea, Japan, you did a step back. As you look forward now, do you think you have the breadth of options as you look to the back half of this decade? Is what you have in front of you in South Korea, Poland, maybe doing more ScotWind -- Scotland? Is that enough to make sure that you have that breadth and be selective on the best projects? Or do you feel like you've got to add maybe 1 more region or 2 more regions to make sure that you're always giving yourselves the breadth of options to select upon?

I think we've got a lot of work to do in Scotland. We've got a lot of work to do in Korea over the next 2 to 3 years to advance those projects, to verify and validate the original investment thesis on developing those projects. So that would be a fair bit of work. In Poland, we'd like to do more. We've had a good experience. We've got a good partner there to be determined what happens in the months and years ahead on Poland. So I think for the time being, that's enough. We are always keeping our eye out for where the next growth opportunity is going to be both offshore and onshore as well. So it's not like we're not looking for it, but we've got our plate fairly full with what we have onshore as well before we start looking at offshore wind in the Great Lakes for Rupert.

Okay. We got one question that's online here, and it aligns with Mark's question here. So any views on France and the offshore wind targets they've established there?

France has actually turned out to be a pretty good market for offshore wind. Northland looked at it, I don't know, probably 8 years ago, Adam, right? We decided not to go ahead with it at the time because we thought the permitting process was going to get drawn out, which it was. It did happen. It did get drawn out, but it actually stabilized and there are some good opportunities there. I think we would really need a local partner or someone else to work with in France, and we don't have that right now. So that's not our top priority by any means.

Okay. Last call. Do we have any other -- any more questions in the room? Okay. No more questions. That's great. Okay. Mike, I'll turn it over to you to wrap up.

Yes. I just want to thank everybody for coming today. Big crowds. I really appreciate you taking time out of your work week to listen to us and ask some really good questions. The lunch is going to be, Dario, upfront. People can grab it, come back into the room, we'll spread out. So if you have any questions you didn't get a chance to ask or didn't want to ask in front of a group, we'll be hanging around for a while. So thank you very much.