Brookfield Renewable (BEPC) - 2023 Q4 - Annual Report

Financial Performance - Funds From Operations at the wind business was $108 million, up from$101 million in the prior year, driven by newly acquired facilities and inflation indexation [80]. - Utility-scale solar business reported Funds From Operations of $114 million, an increase from$85 million, attributed to newly commissioned facilities and higher market prices in Spain [87]. - Revenue from utility-scale solar operations decreased to $125 million in 2023 from$146 million in 2022, while Adjusted EBITDA increased to $101 million from$84 million [82]. - Hydroelectric business achieved Funds From Operations of $504 million, compared to$472 million in the prior year, supported by higher average revenue per MWh and favorable generation [113]. - Total cash flows from operating activities for the year ended December 31, 2023, totaled $1,603 million, an increase from$1,284 million in 2022 [98]. - Net income for 2023 was $308 million, a significant decrease from$1,850 million in 2022 [121]. - Funds From Operations increased to $716 million in 2023, up from$612 million in 2022 [121]. - Adjusted EBITDA for 2023 was $259 million, reflecting a decrease from previous periods [139]. - The company reported a total net loss of$(502) million for Q4 2023, contrasting with a net income of $1,370 million in Q3 2023 [165]. - The company reported a net loss attributable to Unitholders of$100 million for 2023, an improvement from a loss of $295 million in 2022 [163]. Cash Flow and Liquidity - The company maintains a strong liquidity position with$1,975 million in Subordinated Credit Facilities and a $400 million revolving credit facility [123]. - The company has$2.38 billion of committed revolving credit facilities available for investments and acquisitions [97]. - The company had available group liquidity of $4.1 billion as of December 31, 2023 [148]. - Operating cash flow provided was$1,603 million in 2023, compared to $1,284 million in 2022 [128]. Debt and Financing - Total interest expense for the company was$900 million, reflecting the costs associated with various financing activities [120]. - Total debt principal repayments scheduled for 2024 amount to $474 million, with a total of$6,199 million due thereafter [126]. - Total borrowings rose to $29,702 million in 2023, up from$24,850 million in 2022 [163]. - The debt-to-total capitalization ratio was 40% in 2023, compared to 39% in 2022 [163]. - The company expects to finance future acquisitions and capital expenditures through cash generated from operations, capital recycling, debt, and potential equity issuances, but rising interest rates in 2023 may increase the cost of capital [230]. Operational Performance - Generation for utility-scale solar operations increased to 886 GWh in 2023 from 753 GWh in 2022 [82]. - The total generation for the year ended December 31, 2023, was 69,704 GWh, compared to 63,036 GWh in 2022 [163]. - Proportionate Adjusted EBITDA for 2023 was $2,182 million, an increase from$2,002 million in 2022 [163]. - The company invested $1,028 million in property, plant, and equipment during 2023, including a 1,200 MW utility-scale solar facility in Brazil [159]. Market and Regulatory Risks - Legislative changes may impose anti-dumping and countervailing duties on solar cells and modules imported to the U.S., potentially increasing equipment costs and impacting project timelines [245]. - The company faces risks related to the political sensitivity of its nuclear services business, which could affect customer operations and public perception of nuclear power [245]. - Significant increases in water rental costs or changes in water supply regulations could adversely affect the company's financial condition and cash flow [247]. - The company is exposed to various risks in South America, including political instability and potential changes in tax regulations that could negatively impact operations [252]. Corporate Governance and Compliance - Brookfield Holders collectively hold approximately 81.2$20 million to the Service Provider, adjusted annually for inflation, plus 1.25% of the market value exceeding an initial reference value [257]. - The company has filed a report on the effectiveness of its internal control over financial reporting as required by the Sarbanes-Oxley Act [260]. - The company continues to focus on maintaining compliance with regulatory requirements and enhancing internal controls [260]. Future Outlook and Strategy - The company has a twenty-year capital plan to ensure maximum asset life and is focused on renewable energy sources to meet future demand growth [183]. - The company is positioned to capitalize on decarbonization opportunities and may pursue acquisitions in energy transition investments, including nuclear services and renewable natural gas [231]. - The company’s operations include hydroelectric, wind, utility solar, and nuclear services across North and South America, Europe, and Asia, with a development pipeline focused on renewable energy and carbon capture projects [231].