Total Revenue [USD, Millions]

Cost of Goods Sold (COGS) [USD, Millions]

SG&A [USD, Millions]

R&D [USD, Millions]

D&A [USD, Millions]

Interest Expense [USD, Millions]

Operating Income (EBIT) [USD, Millions]

Net Income [USD, Millions]

EPS - Basic [USD]

EPS - Diluted [USD]

431ae7f49d20b75fe17c77ed9f263f88bd5e075d83c7ec042de83427ce7c5381

| Metric / Quarter                              | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-----------------------------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Adjusted EBITDA with Tax Attributes ($ million) | N/A     | **641**  **[0000874761-23-000039_aes-20230331.htm:42]**  | **607**  **[AES_3384523_5]**  | **1,008**  **[0000874761-23-000082_q32023earningsreleaseexs.htm:0]**  | **1,167**  **[0000874761-24-000013_q42023earningsreleaseexs.htm:13]**  | **863**  **[0000874761-24-000039_q12024earningsreleaseexs.htm:2]**  | **843**  **[0000874761-24-000056_q22024earningsreleaseexs.htm:2]**  | **1,168**  **[0000874761-24-000071_q32024earningsreleaseexs.htm:2]**  |
| PPA backlog (GW)                              | **12.2**  **[0000874761-23-000004_q42022earningsreleaseexs.htm:0]**  | **11.932**  **[0000874761-23-000040_q12023earningsreleaseexs.htm:1]**  | **13.170**  **[0000874761-23-000071_aes-20230630.htm:51]** **[0000874761-23-000073_q22023earningsreleaseexs.htm:3]**  | **13.1**  **[AES_3364195_1]**  | **12.3**  **[0000874761-24-000011_aes-20231231.htm:9]** **[0000874761-24-000013_q42023earningsreleaseexs.htm:3]**  | **12.7**  **[0000874761-24-000039_q12024earningsreleaseexs.htm:2]**  | **12.6**  **[0000874761-24-000056_q22024earningsreleaseexs.htm:2]**  | **12.7**  **[0000874761-24-000071_q32024earningsreleaseexs.htm:2]**  |
| GW under construction                         | **5.5**  **[AES_3230199_16]**  | **5.627**  **[0000874761-23-000040_q12023earningsreleaseexs.htm:1]** **[0000874761-23-000039_aes-20230331.htm:37]**  | **5.389**  **[0000874761-23-000073_q22023earningsreleaseexs.htm:3]**  | **5.761**  **[0000874761-23-000082_q32023earningsreleaseexs.htm:2]**  | **5.1**  **[0000874761-24-000011_aes-20231231.htm:9]**  | **5.8**  **[0000874761-24-000039_q12024earningsreleaseexs.htm:2]**  | **5.1**  **[0000874761-24-000056_q22024earningsreleaseexs.htm:2]**  | **4.0**  **[0000874761-24-000071_q32024earningsreleaseexs.htm:2]**  |

59d78b3f94f6d03d008980a455f37093d98364e76611c180501fe2fe7d4889a0

AES is a diversified power generation and utility company organized into four strategic business units (SBUs) based on technology: Renewables, Utilities, Energy Infrastructure, and New Energy Technologies. The company operates two main lines of business: generation and utilities, involving owning and operating power plants to generate and sell power, as well as distributing and selling electricity to end-user customers in various sectors **[0000874761-24-000054_aes-20240630.htm:50]** **[0000874761-24-000011_aes-20231231.htm:16]** **[0000874761-24-000054_aes-20240630.htm:37]** **[0000874761-24-000011_aes-20231231.htm:246]**. AES emphasizes its strategic focus on renewable energy and innovative technologies, indicating significant investment in these areas for future growth **[0000874761-24-000054_aes-20240630.htm:50]** **[0000874761-24-000011_aes-20231231.htm:8]** **[0000874761-24-000011_aes-20231231.htm:246]**.

1. **Utilities** - Comprises regulated utilities such as AES Indiana, AES Ohio, and AES El Salvador, which generate, purchase, distribute, transmit, and sell electricity to end-user customers.
2. **Renewables** - Includes solar, wind, energy storage, and hydro generation facilities, focusing on sustainable energy solutions.
3. **Energy Infrastructure** - Involves natural gas, LNG, coal, pet coke, diesel, and oil generation facilities, including operations in Chile.
4. **New Energy Technologies** - Focuses on green hydrogen initiatives and investments in companies like Fluence, Uplight, and 5B, which are involved in innovative energy technologies.

afd10ae93f33e6da8a50d4fb74d08154d3ac3d9eb2813e09f3df54143770171b

762e575d90a645e99a5eee17b43ed15fcd8c16ec9d39b45635807757c1815a0a

| Segment (USD Million) | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-----------------------|---------|---------|---------|---------|---------|---------|---------|
| Renewables SBU        | **495**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **541**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **708**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **619**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **596**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **726**  **[0000874761-24-000070_aes-20240930.htm:58]**  |
| Utilities SBU         | **971**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **852**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **880**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **873**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **896**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **961**  **[0000874761-24-000070_aes-20240930.htm:58]**  |
| Energy Infrastructure SBU | **1,724**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **1,654**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **1,861**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **1,614**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **1,469**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **1,623**  **[0000874761-24-000070_aes-20240930.htm:58]**  |
| New Energy Technologies SBU | **74**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **1**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **0**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **0**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **0**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **1**  **[0000874761-24-000070_aes-20240930.htm:58]**  |
| Corporate and Other   | **27**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **40**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **29**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **33**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **40**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **33**  **[0000874761-24-000070_aes-20240930.htm:58]**  |
| Eliminations          | **-52**  **[0000874761-23-000039_aes-20230331.htm:38]**  | **-61**  **[0000874761-23-000071_aes-20230630.htm:52]**  | **-44**  **[0000874761-23-000080_aes-20230930.htm:54]**  | N/A     | **-54**  **[0000874761-24-000038_aes-20240331.htm:33]**  | **-59**  **[0000874761-24-000054_aes-20240630.htm:39]**  | **-55**  **[0000874761-24-000070_aes-20240930.htm:58]**  |

360612c5f50abdf30a4fe20e0017240c4c34d6553edad3fa5e0dd42857ba7685

1. With the expected 50%+ load growth in AES Indiana and AES Ohio, how confident are you in your ability to supply the necessary generation capacity, given the planned coal-to-gas conversions and reliance on renewables, and what challenges do you foresee in meeting this demand?
2. Considering the rise in generative AI and the significant demand for data centers, how is AES planning to secure critical components, such as domestically produced solar panels and batteries, to meet domestic content requirements and avoid potential new tariffs?
3. How will the current lower interest rate environment impact the profitability of your future projects, especially those yet to be built, and are there opportunities for incremental benefits from reduced financing costs?
4. You have reported that you are nearly two-thirds of the way to achieving your $3.5 billion asset sale target by 2027; can you provide more details on which specific non-core assets or business segments you are considering for future sales, and how this aligns with your overall strategic focus?
5. Could you elaborate on the timeline and strategies for your projects to qualify for the domestic content bonus tax credits, specifically addressing the implications for returns in both your solar and storage projects, and how any potential delays might affect your financial projections?

7bb2d1a4d6fcea770d98c058c02143e1509df3fa84da6512030c2c741aab4ec9

| Program Details          | Program 1       |
|--------------------------|-----------------|
| Approval Date            | **July 7, 2010**  **[0000874761-24-000070_aes-20240930.htm:114]**  |
| End Date/Duration        | No expiration date  **[0000874761-24-000070_aes-20240930.htm:114]**  |
| Total additional amount  | **$500 million**  **[0000874761-24-000070_aes-20240930.htm:114]**  |
| Remaining authorization amount | **$264 million** (as of 2024-12-21)  **[0000874761-24-000070_aes-20240930.htm:114]**  |
| Details                  | Authorized extension in December 2010  **[0000874761-24-000070_aes-20240930.htm:114]**  |

fa62267aac53cd1d5ea636c84d9942a145a5e8f22304201f25506155fad5325a

936137cd2133b5cb58ebd978a2b56b1e7ef255b0633c48f004c630a16c68c340

Adjustments for Non-Cash Items (USD, Millions)

Stock-Based Compensation (USD, Millions)

Changes in Working Capital (USD, Millions)

Capital Expenditures (USD, Millions)

Proceeds from Debt (USD, Millions)

Repayments of Debt (USD, Millions)

Share Repurchases (USD, Millions)

Dividend Payments (USD, Millions)

Net Change in Cash (USD, Millions)

e4744c88b8630759aca4d28c63364a9ac4b75b01c0fd8530d3eb86cf52f1f8d2

**Annual guidance for FY 2024:**
- **Adjusted EBITDA with Tax Attributes**: $3.6 billion to $4.0 billion  **[AES_3405443_5]**  (no change from top half of $3.6 billion to $4.0 billion  **[AES_3396327_4]** )  
- **Adjusted EPS**: $1.87 to $1.97  **[AES_3405443_5]**  (no change from top half of $1.87 to $1.97  **[AES_3396327_4]** )  
- **Investment in new growth**: $2.2 billion to $2.3 billion  **[AES_3405443_5]**  (lowered from $2.4 billion to $2.7 billion  **[AES_3396327_4]** )  
- **Return to shareholders**: $500 million  **[AES_3405443_5]**  (no change from $500 million  **[AES_3396327_4]** )  
- **Adjusted EBITDA (excluding tax attributes)**: $2.6 billion to $2.9 billion  **[AES_3405443_5]**  (no prior guidance)  
- **Parent Free Cash Flow**: $1.1 billion  **[AES_3405443_5]**  (no prior guidance)  
- **4% dividend increase**  **[AES_3405443_5]**  (no prior guidance)  
- **$650 million from asset sales**  **[AES_3405443_5]**  (no prior guidance)  
- **$2.7 billion total discretionary cash**  **[AES_3405443_5]**  (no prior guidance)  

e25231d41f5713eaaa82c71da8feb14f2e05d54614a655b555855e496d600807

Adjusted EBITDA with Tax Attributes ($ million)

PPA backlog (GW)

GW under construction

2a463d3916c424466c13d135c5dd11a44e9bc6aaaa784f836a94a415fe12d554

### Q4 2023 Earnings Call
- **Issued Period**: Q4 2023
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Adjusted EBITDA with Tax Attributes**: $3.6 billion to $4 billion, including contributions from new renewables projects and rate base growth at U.S. utilities, offset by asset sales  **[AES_3375362_4]** .
  2. **Adjusted EPS**: $1.87 to $1.97, a 9% increase year-over-year, driven by renewables and utilities, offset by higher parent interest and asset sales  **[AES_3375362_5]** .
  3. **Parent Free Cash Flow**: $1.05 billion to $1.15 billion  **[AES_3375362_5]** .
  4. **Net Asset Sale Proceeds**: $900 million to $1.1 billion  **[AES_3375362_5]** .
  5. **Parent Debt Increase**: Approximately $1 billion  **[AES_3375362_5]** .
  6. **Investment in New Growth**: $2.6 billion, with 85% for renewables and utility rate base, over 90% in the U.S.  **[AES_3375362_5]** .
  7. **Dividend Allocation**: $500 million, reflecting a 4% increase  **[AES_3375362_5]** .
  8. **Long-term Growth Rates**: Adjusted EBITDA growth of 5% to 7%, and adjusted EPS growth of 7% to 9% through 2027  **[AES_3375362_1]** .
  9. **Asset Sales Target**: $3.5 billion by 2027  **[AES_3375362_5]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Adjusted EBITDA with Tax Attributes**: $3.6 billion to $4 billion  **[AES_3384522_4]** .
  2. **Adjusted EBITDA**: $2.6 billion to $2.9 billion  **[AES_3384522_4]** .
  3. **Adjusted EPS**: $1.87 to $1.97  **[AES_3384522_4]** .
  4. **Adjusted Tax Rate**: 23% to 25%, excluding tax credit transfers  **[AES_3384522_4]** .
  5. **Parent Capital Allocation**: $3 billion total discretionary cash, including $1.1 billion parent free cash flow, $900 million to $1.1 billion from asset sales, and $900 million to $1 billion planned parent debt issuance  **[AES_3384522_4]** .

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Adjusted EBITDA with Tax Attributes**: Top half of $3.6 billion to $4 billion range  **[AES_3396327_4]** .
  2. **Adjusted EPS**: Upper half of $1.87 to $1.97 range  **[AES_3396327_4]** .
  3. **Parent Capital Allocation**: $500 million return to shareholders, $2.4 billion to $2.7 billion investment in growth, 85% for renewables and utilities  **[AES_3396327_4]** .
  4. **Asset Sale Target**: $3.5 billion from 2023 to 2027, with $2.2 billion signed or closed since 2023  **[AES_3396327_5]** .

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: N/A
- **Guidance**: The documents do not contain information about the Q3 2024 earnings call for AES, so specific guidance metrics from that call are unavailable.

c2dc033e6aa4414f913a0ae01fcf1a7940a75e49fcc5dafca7de211fedc53efb

| Name                  | Position                                                      | Start Date        | Short Bio                                                                                                                                                                                                                                                                                                                                 |
|-----------------------|---------------------------------------------------------------|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Stephen Coughlin      | Executive Vice President & Chief Financial Officer            | October 2021      | Stephen Coughlin, **52 years old**, has served as Executive Vice President and Chief Financial Officer at AES since October 2021. He previously led AES's Corporate Strategy and Financial Planning teams and was CEO of Fluence. He joined AES in 2007 and holds degrees from the University of Virginia and UC Berkeley  **[0000874761-24-000011_aes-20231231.htm:70]** .                                          |
| Bernerd Da Santos     | Executive Vice President & President of the Renewables SBU    | June 2023         | Bernerd Da Santos, **60 years old**, has served as Executive Vice President and President of the Renewables SBU since June 2023. He has held several positions at AES, including COO and EVP. He joined AES in 2000 and holds multiple degrees, including an MBA from Universidad José Maria Vargas  **[0000874761-24-000011_aes-20231231.htm:70]** .                                                                       |
| Ricardo Manuel Falú   | Executive Vice President & Chief Operating Officer            | February 2024     | Ricardo Manuel Falú, **44 years old**, has served as Executive Vice President and Chief Operating Officer at AES since February 2024. He joined AES in 2003 and has held various positions, including President of the Andes region. He holds a CPA degree from Universidad Nacional de Salta and an Executive MBA from IAE Business School  **[0000874761-24-000011_aes-20231231.htm:70]** .                              |
| Paul L. Freedman      | Executive Vice President, General Counsel & Corporate Secretary | February 2021     | Paul L. Freedman, **53 years old**, has served as Executive Vice President, General Counsel, and Corporate Secretary at AES since February 2021. He has been with AES since 2007 and previously worked at the U.S. Agency for International Development. He holds a B.A. from Columbia University and a J.D. from Georgetown University  **[0000874761-24-000011_aes-20231231.htm:71]** **[0000874761-23-000010_aes-20221231.htm:75]** .                                |
| Andrés R. Gluski      | President & Chief Executive Officer                           | September 2011    | Andrés R. Gluski has been serving as the President and Chief Executive Officer of AES since September 2011. Under his leadership, AES has become a leader in clean technologies. He has held various senior roles at AES since 2000, including EVP and COO  **[0000874761-24-000011_aes-20231231.htm:71]** **[0000874761-24-000023_aes-20240314.htm:30]** **[0000874761-23-000021_aes-20230303.htm:24]** .                                                                                                         |
| Tish Mendoza          | Executive Vice President & Chief Human Resources Officer      | February 2021     | Tish Mendoza, **48 years old**, has served as Executive Vice President and Chief Human Resources Officer at AES since February 2021. She joined AES in 2011 and has held various HR leadership roles. She holds a bachelor's degree in Business Administration and Human Resources and has earned certificates in Leadership and HR Management  **[0000874761-24-000011_aes-20231231.htm:71]** .                          |

69d0ff2f7fa5599e95c34b6ead7f4353271acc656c9d8866207ff23ce04fdd6a

59690c1d272cab7cd518f906407d223c8eba33389d4f100d23087eaace4a01fb

| Name              | Start Date | End Date | Reason for Change |
|-------------------|------------|----------|-------------------|
| Ernst & Young LLP | 2008  **[0000874761-24-000011_aes-20231231.htm:172]**    | Present  | Current auditor   |

2a7f0670bbc0f7bb96feeed671108346b3f3221ee87602d7f749a1c2fa80837d

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

- Total Revenue: $3,289 million (-4% YoY)  **[0000874761-24-000070_aes-20240930.htm:5]** **[0000874761-23-000080_aes-20230930.htm:40]**   
- Utilities SBU Revenue: $961 million (+9% YoY)  **[0000874761-24-000070_aes-20240930.htm:45]** **[0000874761-24-000070_aes-20240930.htm:44]** **[0000874761-23-000080_aes-20230930.htm:40]**   
- Energy Infrastructure SBU Revenue: $1,623 million (-13% YoY)  **[0000874761-24-000070_aes-20240930.htm:45]** **[0000874761-24-000070_aes-20240930.htm:44]** **[0000874761-23-000080_aes-20230930.htm:40]**   
- Operating Income: $722 million (-21% YoY)  **[0000874761-24-000070_aes-20240930.htm:5]** **[0000874761-23-000080_aes-20230930.htm:5]**   
- Net Income: **$21 million** (-93% YoY)  **[0000874761-24-000070_aes-20240930.htm:5]** **[0000874761-23-000080_aes-20230930.htm:5]**   
- EPS – Basic: **$0.71** (+103% YoY)  **[0000874761-24-000070_aes-20240930.htm:5]** **[0000874761-23-000080_aes-20230930.htm:5]**   

c6493a9070706c441c5ce789dfb798364395ad3304e835b23fd03cb9e1344858

191b140bb9919923f183d5df0619d7d95ea3ab460ef7aff9b8f7006b886dec6b

| Year  | Amount Due (in millions) | Debt Type                               | Interest Rate | % of Total Debt                       |
|-------|--------------------------|-----------------------------------------|---------------|---------------------------------------|
| 2024  | $1,700                   | Recourse Debt                           | N/A           | 5.8% = (1,700 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:87]** **[0000874761-24-000070_aes-20240930.htm:94]** **[0000874761-24-000070_aes-20240930.htm:4]** |
| 2024  | $200                     | Term Loan                               | N/A           | 0.7% = (200 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:30]**   |
| 2025  | $456                     | Construction Loan                       | 6.59%         | 1.6% = (456 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:31]**   |
| 2028  | $900                     | Senior Notes                            | 5.45%         | 3.1% = (900 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:30]**   |
| 2028  | $350                     | Credit Agreement                        | 8.85%         | 1.2% = (350 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:32]**   |
| 2029  | $500                     | Senior Unsecured Notes                  | 6.30%         | 1.7% = (500 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:32]**   |
| 2054  | $650                     | First Mortgage Bonds                    | 5.70%         | 2.2% = (650 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:32]**   |
| 2055  | $950                     | Subordinated Notes                      | 7.60%         | 3.2% = (950 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:30]**   |
| 2055  | $530                     | Junior Subordinated Notes               | 8.15%         | 1.8% = (530 / 29,400) * 100 **[0000874761-24-000070_aes-20240930.htm:32]**   |

4429dee2f1100ef1588c6776b0f4bcd0b2e887147c2c5d11de04d1cbbf346ded

Total PPA backlog (GW)

PPA backlog under construction (GW)

Long-term PPAs for new renewables signed or awarded (GW)

Renewables capacity constructed (GW)

Renewables capacity to be added (GW)

Additional data center load growth at AES Ohio (MW)

Total data center load growth at AES Ohio year-to-date (GW)

U.S. renewables business pipeline (GW)

fafeb950cb84d5ca01954b4dfac543c2fec52bed7008b6579673ac77badc6d08

1. **Asset Sales and Equity Issuance**  
   **Q:** Can you expand on eliminating future planned equity issuance?  
   **A:** AES has historically overachieved on asset sale targets, exceeding last year's target by **$600 million**.  **[AES_3384522_7]**  They have sold a large asset in Vietnam, pending government approval, which boosts confidence in meeting financing needs without issuing new equity.  **[AES_3384522_7]**  Depending on asset sales, growth programs, and partnerships, they believe they can avoid additional equity issuance, especially at current valuations.  **[AES_3384522_7]** 

2. **Data Center Demand and Renewables**  
   **Q:** How is AES positioned to meet the growing demand from data centers?  
   **A:** AES identified data centers as a key market years ago and has already executed **6 gigawatts** of deals with hyperscalers.  **[AES_3384522_8]**  They are innovating with hourly matched carbon-free energy and have a strong pipeline to meet clients' needs.  **[AES_3384522_8]**  The company believes pipelines are extremely valuable and is confident in their ability to supply renewables despite increasing demand.  **[AES_3384522_11]** 

3. **Impact of Potential Tariffs**  
   **Q:** Are you concerned about potential antidumping tariffs on solar imports?  
   **A:** AES is not concerned about potential antidumping tariffs.  **[AES_3384522_9]**  They have secured most of the necessary solar modules for this year and the majority needed for next year.  **[AES_3384522_9]**  Before any tariffs take effect, they expect to have all modules on site for **2025**, minimizing any impact.  **[AES_3384522_9]** 

4. **Renewables Returns and EBITDA Growth**  
   **Q:** Do renewables investments generate sufficient EBITDA and free cash flow?  
   **A:** AES emphasizes that tax attributes in the U.S. provide immediate cash used to reduce debt, enhancing project returns.  **[AES_3384522_16]**  The company’s commissioning of projects grew **100%** last year, and as these projects come online, EBITDA growth is expected.  **[AES_3384522_16]**  Internationally, returns are even better without upfront tax attributes.  **[AES_3384522_16]** 

5. **Transmission Constraints Solutions**  
   **Q:** How is AES addressing transmission constraints impacting renewables deployment?  
   **A:** AES is implementing dynamic line rating technology, which enabled a **400-megawatt hour** battery project in Indianapolis.  **[AES_3384522_12]**  They are also using grid boosters with batteries to optimize existing transmission lines.  **[AES_3384522_12]**  Advanced software and AI systems help maximize grid utilization, mitigating constraints.  **[AES_3384522_12]** 

6. **Hydrogen Project Progress**  
   **Q:** What is the status of the Texas green hydrogen project?  
   **A:** The joint venture with Air Products in Texas is progressing.  **[AES_3384522_13]**  AES is awaiting final Treasury regulations on green hydrogen qualifications and tax credits.  **[AES_3384522_13]**  Once released, they expect to advance further on what they consider the most advanced green hydrogen project in the U.S. with a real offtaker.  **[AES_3384522_13]** 

7. **Data Center Proximity and Reliability**  
   **Q:** Are virtual PPAs sufficient to support data centers' reliability needs?  
   **A:** Proximity to data centers is important to minimize transmission charges.  **[AES_3384522_17]**  AES is adding battery storage to solar and wind sites within the region, ensuring reliable power supply.  **[AES_3384522_17]**  As data centers expand toward the middle of the country, co-locating with generation assets becomes more feasible.  **[AES_3384522_17]** 

8. **Utility Side Data Center Opportunities**  
   **Q:** Are there developments with data centers within AES's utilities?  
   **A:** There is interest from hyperscalers in AES's utilities due to transmission and other attributes.  **[AES_3384522_18]**  This potential demand would be additional to current plans, offering upside beyond existing integrated resource plans.  **[AES_3384522_18]** 

60a41822a6f067cffb39c5f78abb528a8188e00482d949f87b14b52b29e70f5d

- **AES plans to raise at least $2 billion through asset sales in 2024 and 2025**, which may be challenging to achieve in current market conditions, potentially impacting their ability to finance growth.  **[AES_3364195_12]**
- AES may delay exiting **3.5 GW of coal assets** beyond 2025 to support energy reliability, which could hinder its decarbonization goals and expose the company to environmental and regulatory risks.  **[AES_3364195_24]**
- The company's emphasis on **maintaining investment-grade credit ratings as a top priority** may limit financial flexibility and constrain funding for future growth initiatives.  **[AES_3364195_12]**

ead8d5b84eef1ea24c85d67883478a85a59568cea9c44fd03771e4bd2ccf6f0d

- **AES anticipates over 50% increase in peak load at its AES Ohio and AES Indiana utilities due to data center growth**, leading to significant investments in transmission and generation assets and further increasing rate base growth.  **[AES_3396327_12]**
- **Credit metrics are improving**, with expectations to surpass last year's year-end figures, positioning AES for potential future credit rating upgrades.  **[AES_3396327_7]** **[AES_3396327_1]**
- **AES is poised to benefit from the Inflation Reduction Act's domestic content bonuses**, already meeting criteria for wind projects, expecting battery projects to meet requirements starting in 2025, and solar panels by 2026, which could enhance project returns.  **[AES_3396327_30]**

14dbf4127150054110d3da4bd88ae54ac4ac7b1575d6330d765d91d256741091

- **AES is experiencing very strong demand from target customers**, especially tech companies in the data center business, in key markets like California, New York, and PJM. The company has **not seen a slowdown** in demand in these markets.  **[AES_3364195_8]**
- **Mechanical completion has been achieved on 93% of new capacity**, with an increase in the year-end construction target from **3.4 GW to 3.5 GW**. This strong execution gives confidence in achieving year-end numbers, and provides a clear line of sight to potential EPS upside.  **[AES_3364195_10]**
- **AES is leveraging technological innovations**, such as AI in wind farm operations and **robotics in solar farm construction**, which show a lot of promise for cost savings and efficiency improvements. The company expects these innovations to have significant benefits over time, including potential monetization opportunities.  **[AES_3364195_26]**

bfdf47362fcb8bce3086c803adac64c012bbf34bc4934bcd73075520e059a6ba

- AES is **reducing its dividend growth rate** from historical levels to **2% to 3% annually beyond 2024**, which may impact income-focused investors.  **[AES_3375362_6]**
- The **2024 adjusted EBITDA** is expected to be flat due to a **$200 million asset sale drag**, offsetting growth from rate base and renewables projects.  **[AES_3375362_8]**
- Despite signing a record **5.6 gigawatts** of new PPAs in 2023, AES plans to add only **3.6 gigawatts** of new projects in 2024, similar to 2023 levels, indicating a potential **flattening of growth** in capacity additions.  **[AES_3375362_21]**

9c536b1f3969d18bd831cb15f2546e8bce1487eabcf34480c62162cd03114bea

- AES signed **1.2 gigawatts** of new renewables in the first quarter, including a significant contract with Amazon for **2 gigawatts** at the Bellefield project, demonstrating strong demand and successful execution on large-scale projects.  **[AES_3384522_14]**
- AES is advancing its **green hydrogen project in Texas**, a joint venture with Air Products, which is **the most advanced green hydrogen project in the U.S. with a real offtaker**, positioning AES at the forefront of green hydrogen development.  **[AES_3384522_13]**
- AES has secured **6 gigawatts** of renewable projects with data centers and technology companies, reflecting its early focus on this sector and strong client relationships, providing a competitive advantage in meeting growing demand.  **[AES_3384522_8]**

5295c9d1a3f9ea97ad6331f4b9cfdc2ac071b221f73be4da4b3496d95954cb00

1. **Higher Returns in Renewables**  
   **Q:** What's driving higher returns in the renewables business?  
   **A:** Management stated that higher returns are driven by a combination of better returns on prior PPAs and positioning in select markets with a shortage of renewable projects, such as California, PJM, and New York.  **[AES_3375362_10]**  They are also becoming more efficient in construction and development processes, with supply chain disruptions now past.  **[AES_3375362_10]**  Strong demand from large corporate customers, especially in the data center segment, is contributing to higher returns.  **[AES_3375362_13]** 

2. **Dividend Growth Policy Adjustment**  
   **Q:** Why reduce long-term dividend growth to 2%–3% starting in 2025?  
   **A:** Given significant growth opportunities in renewables and utilities, management decided to allocate more capital to these higher-return investments.  **[AES_3375362_20]**  While committed to growing the dividend, they believe a slightly lower growth rate makes sense to support the capital needs of the business.  **[AES_3375362_20]** 

3. **Leverage Targets and Credit Metrics**  
   **Q:** How are you managing leverage and credit metrics?  
   **A:** The company ended 2023 with an FFO-to-debt ratio of approximately **22%**, above the threshold of **20%**.  **[AES_3375362_15]** **[AES_3375362_16]**  Management expects this ratio to remain at least at this level or improve over time.  **[AES_3375362_15]** **[AES_3375362_16]**  Maintaining investment-grade credit is a top priority, and they have built a strong cushion into their metrics.  **[AES_3375362_9]** **[AES_3375362_15]** **[AES_3375362_16]** 

4. **Flat EBITDA Guidance Due to Asset Sales**  
   **Q:** Why is EBITDA guidance flat despite a growth outlook?  
   **A:** EBITDA guidance appears flat primarily because they are ahead on asset sale targets, achieving **$1.1 billion** versus the guidance of **$400–$600 million** in 2023.  **[AES_3375362_8]**  This results in a lag when redeploying capital, causing an asset sale drag of about **$200 million** this year.  **[AES_3375362_8]** 

5. **Impact of Coal Plant Retirements**  
   **Q:** What's the update on coal plant retirements and their financial impact?  
   **A:** The company has extended coal plant retirements through 2027 for a handful of assets, smoothing out the **$750 million** EBITDA reduction from coal exits over several years.  **[AES_3375362_18]**  This adds to EBITDA over the timeframe and avoids a sharp decline, but the biggest driver of EBITDA uplift remains higher returns from renewables.  **[AES_3375362_18]** 

6. **Renewables Capacity Additions and Timing**  
   **Q:** Why are renewables capacity additions flat despite higher PPA signings?  
   **A:** The flat capacity additions are due to project timing.  **[AES_3375362_14]**  While they've been signing over **5 GW** of new PPAs annually, the convergence of signing and commissioning won't happen immediately due to the timing of projects and develop-and-transfer projects not included in the backlog.  **[AES_3375362_14]**  Management emphasizes this is not indicative of any issues.  **[AES_3375362_14]** 

7. **Returns on Existing Assets**  
   **Q:** Are existing assets experiencing any degradation in returns?  
   **A:** Management reported no degradation in EBITDA or cash flow generation of existing assets.  **[AES_3375362_17]**  Older projects are providing returns as expected or even better than forecasted.  **[AES_3375362_17]** 

8. **Tax Credit Guidance and Growth**  
   **Q:** Is the $1 billion tax credit guidance for 2024 sustainable?  
   **A:** Management expects tax credits to grow as they continue adding renewable projects.  **[AES_3375362_21]**  The higher figure is due to the success of the business, doubling construction last year, and recognizing credits from prior projects.  **[AES_3375362_21]**  They anticipate this amount will rise in future years.  **[AES_3375362_21]** 

9. **Impact of Nuclear Power on Demand**  
   **Q:** Could nuclear power growth disadvantage your pursuit of tech clients?  
   **A:** Management does not foresee nuclear power impacting demand for renewables in the near term.  **[AES_3375362_19]**  They acknowledge that while nuclear may be part of the long-run solution, they believe renewable growth will continue strongly over the next five to ten years due to permitting challenges and budget overruns associated with nuclear projects.  **[AES_3375362_19]** 

10. **Returns on Data Center Projects**  
    **Q:** How do returns on data center projects compare to others?  
    **A:** While not providing specifics, management indicated that, on average, they are seeing an increase in returns across projects, including those with data center clients.  **[AES_3375362_19]**  They focus on projects that deliver the best financial benefits, maximizing shareholder value per share.  **[AES_3375362_13]** 

fde1d936c43c4ba4f88e95902f79c14110435b397b72b35efcc3cab320fc88ea

1. **Utility Load Growth**  
   **Q:** What's the breakdown of the 3 GW utility load opportunity in Indiana and Ohio, and impact on CapEx?  
   **A:** AES is seeing significant load growth opportunities in their utilities, driven by data centers. While specifics are still being finalized, this represents upside to their capital plans. They expect to include more details in next year's guidance, with the funding plan remaining unchanged due to strong asset sales and partnership capital.  **[AES_3396327_10]** ,  **[AES_3396327_11]** ,  **[AES_3396327_15]** 

2. **Credit Metrics Improvement**  
   **Q:** Can you update us on credit metrics and FFO to debt ratio outlook?  
   **A:** AES's credit metrics are improving and are expected to be higher than last year's year-end levels. They have a threshold FFO to debt ratio of **20%**, with current metrics providing cushion above that. They foresee possible mid-BBB ratings in a matter of years, as the quality of cash flows improves with long-term contracts and asset sales.  **[AES_3396327_7]** ,  **[AES_3396327_8]** ,  **[AES_3396327_12]** 

3. **Returns on Renewable Projects**  
   **Q:** Is there upside potential to returns given supply and demand dynamics?  
   **A:** AES is focusing on maximizing the quality of megawatts over quantity, optimizing their renewable pipeline to maximize value. They've increased average project returns to the **mid-teens** and are optimistic that market conditions may allow for further return enhancements, although they are satisfied with current levels.  **[AES_3396327_11]** ,  **[AES_3396327_12]** 

4. **Supply Chain and Time to Power**  
   **Q:** How secure is AES's domestic supply chain for 2026, considering tariffs?  
   **A:** AES feels very confident in their ability to execute and deliver their U.S. backlog. They have secured necessary materials for this year, 2024, and the vast majority for 2025. Agreements with domestic suppliers starting in **2026** ensure compliance with domestic content requirements under the IRA, mitigating tariff risks.  **[AES_3396327_16]** 

5. **Financing Plan for Utility Growth**  
   **Q:** How will you finance the upside in utility CapEx due to load growth?  
   **A:** AES doesn't expect changes to their funding plan, despite the anticipated utility growth. Successful asset sales and partnership capital provide the flexibility to invest in utility growth within their existing funding plan through **2027**.  **[AES_3396327_15]** ,  **[AES_3396327_12]** 

6. **Domestic Content Bonus Impact**  
   **Q:** When will your projects be eligible for the domestic content bonus, and implications for returns?  
   **A:** AES's wind projects already meet domestic content criteria, with solar projects expected to qualify starting in **2026** and batteries in **2025**. This qualifies them for a **10%** adder across the entire capital cost of projects, enhancing returns. The benefit may be shared with customers depending on market conditions.  **[AES_3396327_28]** ,  **[AES_3396327_29]** 

7. **Ohio Generation and Load Growth**  
   **Q:** Any appetite to own regulated generation in Ohio given load growth?  
   **A:** AES currently has no appetite for owning generation in Ohio directly but sees opportunities for their renewables team. They are confident in meeting the increased demand over time without changing their current approach.  **[AES_3396327_20]** ,  **[AES_3396327_21]** 

8. **Hyperscalers' Renewable Energy Demand**  
   **Q:** Do hyperscalers' renewable goals affect their power contracts?  
   **A:** Hyperscalers prefer renewable power to meet their sustainability goals and require additionality, though they may use non-renewable power as a last resort. AES works closely with them to provide tailored renewable solutions, including colocation and innovative technologies, ensuring alignment with hyperscalers' environmental objectives.  **[AES_3396327_23]** ,  **[AES_3396327_24]** ,  **[AES_3396327_25]** ,  **[AES_3396327_26]** 

e82099831f013a4a09d4abaf48ff2e0ee2f2ac23e8f0df440bb66c797c98fb7e

3ba01ecad94eace04d7a617f8fbaa9411c6c859f4ba4fccb89a664bfb1df6bef

- AES's renewable operations have been negatively impacted by weather-related disruptions, such as the forced outage at their **1-gigawatt Chivor hydro plant in Colombia due to record flooding**, leading to reduced EBITDA this year.  **[AES_3396327_17]**
- AES experienced **lower wind resources in Brazil**, which also negatively affected EBITDA, indicating susceptibility of their renewable assets to variable natural conditions.  **[AES_3396327_17]**
- There is **uncertainty about AES's ability to fully retain benefits** from favorable market conditions or policies, as the division of gains with customers in PPA pricing depends on specific market circumstances, potentially impacting returns.  **[AES_3396327_29]**

3703cd48e2c269981dd7c57701f2ddcdf63087b57994b447e621a56ebeef9b5d

1. **EBITDA Growth and Brazil Exit**  
   **Q:** How will AES meet its EBITDA growth targets without Brazil?  
   **A:** Management remains confident in achieving the **5–7% EBITDA CAGR** through 2027, despite selling their Brazil business. They expect significant growth from U.S. renewables, adding **3 gigawatts** this year, and anticipate more normal conditions after unusual weather impacted results. While renewable EBITDA won't grow substantially in **2025** due to the Brazil sale and weather impacts, they foresee significant growth in later years, especially beyond **2025**.  **[AES_3405443_9]** **[AES_3405443_19]** **[AES_3405443_20]** **[AES_3405443_22]** 

2. **Credit Metrics and Moody's Review**  
   **Q:** Will AES need to adjust asset sales due to Moody's review?  
   **A:** AES has constructive discussions with Moody's and expects an update before year-end. They believe their credit quality has improved through portfolio transformation, exiting carbon-intensive assets, and investing in long-term U.S. renewables. They do not anticipate needing to accelerate asset sales, as parent-level metrics remain strong, with a ratio between **22% and 23%**, above the **20%** threshold. Recent asset sales like Brazil are credit accretive.  **[AES_3405443_15]** **[AES_3405443_16]** 

3. **Asset Sale Program Outlook**  
   **Q:** Do you plan to upsize or accelerate your asset sale target?  
   **A:** Management sees no need to adjust the asset sale program, having always exceeded targets and sold assets at good value. The program continues to support their credit metrics and investment plans, including funding increased utility investments.  **[AES_3405443_16]** 

4. **Utility Rate Base Growth**  
   **Q:** Is rate base growth at Indiana utilities expected to increase?  
   **A:** Yes, AES expects rate base growth at its Indiana utilities to be much higher than previously anticipated, driven by significant new generation and increased data center load. They anticipate **double-digit rate base growth**, potentially higher, and will provide updated guidance in February. Selling down Ohio helps fund this larger investment program.  **[AES_3405443_17]** **[AES_3405443_18]** 

5. **Renewable Returns and Supply Chain**  
   **Q:** Are renewable returns trending upwards, and is the supply chain secure?  
   **A:** Management is confident in their construction program and supply chain, having secured **84%** of equipment needed for next year and expecting **100%** shortly. Newer projects are achieving returns at the upper end of expectations, and they feel very confident in the numbers provided.  **[AES_3405443_8]** **[AES_3405443_11]** 

6. **Tax Credits Outperformance**  
   **Q:** What drove the $200 million higher-than-expected tax credits, and can this continue?  
   **A:** The outperformance stemmed from AES's expertise in qualifying for bonus credits, such as energy community adders, and efficiently monetizing tax credits through transfers. Management sees potential for future upside, considering it a core competency and key differentiator.  **[AES_3405443_10]** 

7. **Impact of Weather Events in Colombia**  
   **Q:** When will the $92 million Colombia impact return to normal?  
   **A:** Conditions are already improving, with the fourth quarter expected to be higher than last year. Forecasts indicate a shift to **La Niña**, likely to bring more favorable hydrology. Management expects Colombia to return to normal or better conditions in **2025**.  **[AES_3405443_24]** 

8. **Southland Hedging Strategy**  
   **Q:** Are you changing your hedging strategy due to California spark spreads?  
   **A:** AES plans to continue marketing the energy from Southland and has already hedged over **95%** of **2025** production at values above the put option. While spark spreads have compressed, they still expect to achieve returns above the put value, though not as high as originally anticipated.  **[AES_3405443_25]** **[AES_3405443_26]** 

9. **Hydrogen Project with APD**  
   **Q:** What's the status of your 1.5 GW hydrogen project with APD?  
   **A:** AES has developed a very attractive **1.5 gigawatt** renewable asset, which may be used for hydrogen depending on finalization of policies like **45V**. They have minimal capital invested to date and consider it a valuable asset, but it is not included in their backlog until a **PPA** is signed.  **[AES_3405443_13]** **[AES_3405443_14]** 

10. **Wind Development Plans**  
    **Q:** Are you planning more wind projects amid an industry trend away from wind?  
    **A:** AES plans a more balanced mix between wind and solar in future U.S. projects. They have wind projects in the pipeline, including the **1.5 gigawatt** green hydrogen project in Texas, which is primarily wind.  **[AES_3405443_23]** 

cfff754befa46e49ad4d9ce6a32702fd8af699488d30192c3e3ebf54ee5f14b9

- **High investment costs in renewables with seemingly little EBITDA and free cash flow accretion**: Analysts expressed concerns that AES's significant investments in renewables are not generating proportional EBITDA and free cash flow, questioning whether the returns justify the expenditures.  **[AES_3384522_16]**
- **Potential regulatory delays affecting key projects**: AES's major green hydrogen project in Texas is awaiting final treasury regulations on what qualifies as green hydrogen, which could impact the project's progress and financial benefits.  **[AES_3384522_13]**
- **Risks from potential antidumping tariffs on solar modules**: Though management is not concerned, potential antidumping tariffs could affect AES's supply chain, project costs, and timelines, which might impact future projects beyond 2025.  **[AES_3384522_9]**

76addd4676776ee5b27389f9b467e222b038a64a5decdd3c7fc444ff232ea4b1

- **AES is experiencing higher returns in its renewables projects, now expecting U.S. returns of 12% to 15%**, driven by increased efficiency, focusing on high-return projects, and strong demand in select markets like California and PJM.  **[AES_3375362_10]** **[AES_3375362_17]**
- **AES is achieving strong growth in both its renewables and utilities segments**, with some of the fastest-growing utilities in the U.S., and is signing over **5 gigawatts of new PPAs per year**, indicating robust future growth.  **[AES_3375362_14]** **[AES_3375362_11]**
- **AES has exceeded its asset sale targets, generating $1.1 billion in proceeds versus the $400 million to $600 million guidance**, which is being reinvested into high-return growth opportunities, enhancing their financial results.  **[AES_3375362_8]** **[AES_3375362_21]**

bc6c858fe4d167d08a6ccc4db52efe201b53c5372af7536793eeed7875076296

AES Corp (AES)

Financials