15 August 2025 Bernstein Energy & Power: Is there enough power to meet AI growth? Neil Beveridge, Ph.D. +852 2123 2648 neil.beveridge@bernsteinsg.com Nikhil Nigania +91 226 842 1414 nikhil.nigania@bernsteinsg.com Deepa Venkateswaran, ACA +44 207 676 6990 deepa.venkateswaran@bernsteinsg.com Guillaume Delaby +33 1 42 13 62 29 guillaume.delaby@bernsteinsg.com Irene Himona, Ph.D. +44 20 7762 5353 irene.himona@bernsteinsg.com Bob Brackett, Ph.D. +1 917 344 8422 bob.brackett@bernsteinsg.com Is there enough power ...

Q1 FY26 Results Presentation August 14, 2025 Disclaimer Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "w ...

Core Viewpoint - The article discusses the implementation details of the new pricing mechanism for renewable energy projects in Shandong Province, focusing on the competitive bidding process for wind and solar power projects set to be operational between June 1 and December 31, 2025 [2][9]. Bidding Parameters - The total scale of the mechanism electricity is set at 9.467 billion kWh, with wind power accounting for 8.173 billion kWh and solar power for 1.294 billion kWh [3]. - The minimum bidding submission rate for both wind and solar projects is established at 125% [4]. - The mechanism electricity ratio is set at 70% for wind projects and 80% for solar projects [5]. - The bidding price limits are defined, with a maximum of 0.35 yuan per kWh for both wind and solar, and a minimum of 0.094 yuan for wind and 0.123 yuan for solar [5]. Execution Period - The execution period for deep-sea wind power is set at 15 years, while other projects will have a 10-year period [6]. Calculation of Mechanism Electricity - Specific formulas for calculating mechanism electricity for various types of projects are provided, including land-based wind, offshore wind, and both centralized and distributed solar power [6][7]. Bidding Subject - The bidding participants must be projects that have been completed and those expected to be operational by December 31 of the following year, which have not previously been included in the mechanism pricing [8][15]. Bidding Organization - The bidding will be organized separately for different technology types, such as solar and deep-sea wind, unless there is a lack of effective competition [8][24]. Bidding Volume - The annual new electricity volume included in the mechanism will be determined based on the completion of renewable energy consumption responsibilities and user affordability [23]. Bidding Process - The bidding process is scheduled to be organized annually in October, with the first bidding taking place in August 2025 [31]. Guarantee Mechanism - Requirements for performance guarantees are specified for both operational and non-operational projects, with specific amounts calculated based on project capacity and bidding parameters [35][36]. Conclusion - The implementation details aim to promote high-quality development of renewable energy in Shandong Province, ensuring a structured and competitive bidding process for future projects [9][39].

Summary of Key Points from J.P. Morgan's Research on China Wind Power Industry Overview - The report focuses on the wind power industry in China, particularly the performance and forecasts related to wind farm operators, with a specific emphasis on Longyuan Power [1][30]. Core Insights and Arguments - **Power Generation Forecasts**: J.P. Morgan employs machine learning techniques to predict monthly power generation for wind farms, indicating that July's wind power generation for Longyuan is expected to grow by approximately 4%, which is below the 10% organic capacity growth anticipated for FY24 [1][4][6]. - **Market Reaction**: A negative share price reaction is expected following the release of Longyuan's July data due to the discrepancy between generation growth and capacity growth [1][4]. - **Historical Performance**: Between FY19-23, annual wind power generation growth closely tracked capacity growth, but monthly growth exhibited significant volatility, ranging from -17% to +51% [4][10]. - **Curtailment and Wind Speed Issues**: FY24 has seen a decoupling of generation growth (-2%) from capacity growth (+6% YoY) due to rising curtailment rates and lower wind speeds [4][10]. - **Investment Strategy**: A long-short strategy based on predicted generation growth deviations from capacity growth could have yielded an average annual return of approximately 8.5% from 2019 to 2024 [4][16]. Company-Specific Insights - **Longyuan Power**: - Longyuan is identified as the largest wind farm operator in China, with a total consolidated wind installed capacity of 30.4 GW as of the end of 2024 [31]. - The company is rated "Overweight" with a price target of HK$7.60, supported by secular capacity growth driven by China's carbon-neutrality goals and an increasing mix of grid-parity projects [30][31]. - The report highlights Longyuan's lower gearing (174% FY25E) compared to Datang RE (357% FY25E), justifying a higher target multiple for Longyuan [32]. - **Datang Renewable Energy**: - Datang RE is rated "Neutral" with a price target of HK$2.20, reflecting limited visible catalysts in the near term despite its significant wind power capacity [35]. Additional Important Information - **Wind Speed Variability**: The report notes significant regional differences in wind speed for July 2025, with Shaanxi, Jiangsu, and Shanghai experiencing increases of 21.8%, 20.3%, and 17.6% YoY, respectively, while Guizhou, Hunan, and Jiangxi saw decreases of 34.2%, 29.9%, and 23.6% [26][27]. - **Model Accuracy**: The predictive model for Longyuan's power generation has an average accuracy of approximately 95%, based on historical data from January 2014 to July 2025 [21]. - **Risks to Ratings**: Potential risks to Longyuan's rating and price target include lower-than-expected utilization hours, lower tariffs, and higher finance costs [32][35]. This comprehensive analysis provides insights into the current state and future outlook of the wind power industry in China, particularly focusing on Longyuan Power and its competitive positioning within the market.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Supplemental Information contains forward-looking statements and information, within the meaning of Canadian securities laws and "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the U.S. Securities Exchange Act of 1934, as amended, "safe harbor" provisions of the United States Private Securities Litigation Reform ...

Financial Performance - Funds From Operations (FFO) increased to $371 million, a 10% increase year-over-year, driven by strong hydro performance, stable contracted cash flows, and contributions from new development projects[9] - FFO per Unit increased to $0.56, a 10% increase from the prior year[9] - Available liquidity stands at $4.7 billion, supporting growth initiatives[10] - The company maintains a best-in-class balance sheet with $4.7 billion of available liquidity and virtually no floating rate exposure[15] Operational Highlights - The company has approximately 47,500 MW of total operating capacity[22] - The company delivered ~7,700 MW of capacity during the last twelve months and expects to bring on a total of ~8,000 MW of new renewable capacity in 2025[19] - Actual renewable generation was 9,542 GWh, compared to 8,298 GWh in the same quarter of the previous year[9] Portfolio and Strategy - The company has total power and sustainable solutions assets of approximately $138 billion[22] - Approximately 90% of generation, on a proportionate basis, is contracted for an average term of 13 years, and approximately 70% of revenues are indexed to inflation[27] - The company is executing on its asset recycling program, with expected proceeds of approximately $1.5 billion (~$400 million net to Brookfield Renewable)[19]

Core Viewpoint - The article discusses the implementation plan for the market-oriented reform of renewable energy grid prices in Ningxia, aiming to enhance the role of the market in resource allocation and promote high-quality development of renewable energy [3]. Group 1: Market Formation of Renewable Energy Grid Prices - Renewable energy generation (wind and solar) will primarily participate in market trading, with grid prices determined through market transactions [4]. - A price cap of 0.56 yuan/kWh and a floor of 0 yuan/kWh will be established for the Ningxia electricity spot market, with adjustments based on market operations [4]. - Encouragement for distributed renewable energy projects to participate directly or through aggregation in market trading [4]. Group 2: Support Mechanisms for High-Quality Development - A sustainable price settlement mechanism will be established, where the difference between the market transaction average price and the mechanism price will be shared among all industrial and commercial users [5]. - For existing renewable energy projects (operational before June 1, 2025), 10% of the grid electricity from centralized solar and wind projects will be included in the mechanism, with a mechanism price set at 0.2595 yuan/kWh [6]. - New renewable energy projects starting from June 1, 2025, will have their mechanism electricity scale and price determined based on market conditions, with a bidding price range set between 0.18 yuan/kWh and 0.2595 yuan/kWh [7]. Group 3: Collaborative Reform Mechanisms - The plan emphasizes policy coordination to align with the regional renewable energy development goals, enhancing the consumption level of renewable energy [9]. - Strengthening organizational collaboration among relevant departments to ensure effective implementation of the reform measures [10]. - Continuous monitoring and evaluation of market price fluctuations, renewable energy generation costs, and user electricity prices will be conducted to assess the impact of the reforms [10]. Implementation Timeline - The proposed plan will take effect on October 1, 2025, subject to adjustments based on national policy changes [11].

Renewable Energy Growth - Solar and wind power are experiencing "unstoppable" global growth [1]

Industry Trend - Solar and wind power are experiencing "unstoppable" global growth [1]

Renewable Energy Growth - Solar and wind power are experiencing "unstoppable" global growth [1] Industry Outlook - The report highlights the continued expansion and dominance of solar and wind energy in the global energy market [1]