Heidi Hauch

Heidi Hauch asked about Clearway's strategy regarding asset dispositions, whether it's core to the funding strategy, if specific assets are eligible, and if it could offset equity issuance or drive incremental growth. She also inquired about the timing for formalizing contracts for data center opportunities involving natural gas and the broader drivers for developing flexible generation.

Answer

President and CEO Craig Cornelius clarified that planned asset dispositions are not incorporated into the capital allocation framework or funding sources for long-term growth. However, as fiduciaries, they remain open to selective dispositions if more accretive for shareholders, citing past examples like the district thermal segment divestiture. Regarding data centers, Mr. Cornelius explained that flexible generation complements renewables, drawing on Clearway's California experience, and helps carbon-free resources serve growing gigawatt-scale loads. He emphasized that the core business remains renewable and battery projects, which underpin the 2030 goals.

Heidi Hauch asked about Clearway's asset disposition strategy as part of its broader funding, inquiring if it's core to the strategy, which assets might be eligible, and if dispositions could offset equity issuance or drive incremental growth. She also sought details on the timing for formalizing contracts for natural gas development in data centers and the strategic drivers behind Clearway's involvement in flexible generation.

Answer

Craig Cornelius, President and CEO, clarified that asset dispositions are not incorporated into the capital allocation framework for long-term growth goals, but the company remains open to selective divestitures if they are accretive to shareholders. He noted that the flexible generation resources in development are additional to Clearway's core renewable and battery projects, driven by customer demand for complementary gas to support renewables and growing data center loads, particularly in regions like California where flexible generation is essential for reliability. Mr. Cornelius reiterated that the 2030 goals are underpinned entirely by renewable and battery projects.

Heidi Hauch, on for Moses Sutton, asked if a potential reduction in tax credits would create a larger investment opportunity for HASI by widening the capital stack gap that needs to be filled.

Answer

Chief Revenue & Strategy Officer Marc Pangburn confirmed that, incrementally, a reduction in tax equity would likely create a larger monetization opportunity for HASI. He explained that if tax equity decreases, sponsors would likely pass through higher PPA rates, increasing the level of cash equity in a project's capital stack, which is where HASI typically invests.