Brookfield Renewable Partners L.P.

Thank you, operator. Good morning, everyone, and thank you for joining us this morning for our first quarter conference call.

With me on the call is Sachin Shah, our Chief Financial Officer. Before we begin, I would like to remind you that a copy of our news release, investor supplement and letter to shareholders can be found on our website at www.brookfieldrenewable.com

It has been a very strong start to the year, with continued progress in meeting our long-term growth objectives, as well as strong operating and financial performance. As expected, after several challenging quarters, we're very pleased to see hydrology return to normal levels, and Sachin will discuss the particulars in the financial review.

In the first quarter, we invested $600 million of equity in 3 transactions representing more than 560 megawatts of renewable generation. This brings to more than 1,000 megawatts, the capacity added since Brookfield Renewable was launched in late 2011.

These investments have expanded our global footprint, and we believe that they will be accretive to shareholders, increasing our cash flows and adding meaningfully to the long-term value of the business.

As you know, our long-term contracted portfolio provides the business with a stable and predictable cash flow profile. This formula has served us very well and continues to be the cornerstone of our strategy.

That said, we find ourselves in a unique investment environment that has permitted us to acquire attractive hydro portfolios, such as Smoky Mountain and White Pine, at compelling values. These assets carry strong upside potential from rising energy prices, which we expect to be an important driver of value in the coming years due to tighter supply, continued demand for renewables and an eventual sustained economic recovery in the U.S.

Our unique operating platform, established over many years, is not easily replicated and lets us maximize the value of our portfolio while providing a significant advantage when competing for new assets. We believe that our operated -- or operations-oriented approach will help us to surface additional value from these newly acquired facilities, which are highly complementary to our existing assets and in markets where we have strong operating presence.

Amongst the growth initiatives in Q1, we completed the purchase of 360-megawatt White Pine hydroelectric portfolio in Maine. Following this transaction, we own and operate nearly 1,300 megawatts of capacity in New England, making us one of the region's largest independent power producers.

We are in the process of taking up the remaining 7% of Western Wind shares and integrating the assets into our North American wind platform. This transaction has increased our wind capacity in the U.S.

by 165 megawatts to 430 megawatts, mostly in high-value Tehachapi region of California.

Also, in March, we completed the purchase of our partner's 50% interest in the 83 megawatts Powell River portfolio located in British Columbia. We've been managing these assets since 2001 and look forward to the continued ownership of these high-quality facilities.

With the commissioning of a 29-megawatt hydro project in Brazil, we have completed the last of the 7 active construction projects that existed at the inception of Brookfield Renewable. These projects were delivered on scope, schedule and budget and are performing in line with our expectations.

The 45-megawatt Kokish River Hydro project in Western Canada, which began construction last year, is progressing as planned and is on track for completion mid-2014.

Looking ahead to the rest of the year, we are very encouraged by the investment opportunities we're seeing and what it means for the continued growth of the business. In North America, we continue to monitor announced sales process by a variety of market participants, including strategic owner operators and financial sponsors.

This should result in more asset sales in 2013. In Brazil, we expect the current market conditions will lead to the -- to opportunities to grow our business and achieve operating synergies.

Finally, expansion into new markets and renewable technologies remain important longer-term growth objectives, and we are continuing to evaluate what we believe to be the most suitable opportunities.

On a final note, we have made significant progress in addressing the remaining issues in connection with our pending New York Stock Exchange listing. We are optimistic that the process is nearing completion, and we'll keep you informed as we move forward.

I'll now hand over the call to Sachin to discuss our financial and operating results.

Thank you, Richard, and good morning. Total generation in the first quarter was approximately 5,500 gigawatt hours, which was 200 gigawatt hours higher than long-term average and 700 gigawatts hours higher than the prior year.

Our hydro portfolio benefited from strong inflows resulting in generations at long-term average levels in most regions, with Ontario, Québec and the recently acquired Smoky Mountain assets having a particularly strong quarter. Hydro generation was nearly 650 gigawatt hours higher than the prior year due to the contribution of acquired or commissioned facilities in the last 12 months and slightly lower than the prior year on a same-store basis due to very favorable conditions in the first quarter of 2012.

Reservoir levels on a portfolio basis are in line with long-term average conditions for this time of year.

Generation from our wind portfolio was up 81 gigawatt hours as compared to the same period last year due to newly acquired or commissioned facilities in California and New England. As with our hydro portfolio, wind conditions in Canada were slightly lower than long-term average and lower than the Q1 -- very strong results in Q1 of 2012 but in line, sorry, with long-term average this year.

Revenues of $437 million were $11 million higher than the same period last year. Adjusted EBITDA totaled $319 million, which was consistent with the prior year as 2012 results benefited significantly from strong generation at facilities with high-priced power sales arrangements.

Funds from operations, or FFO, totaled $162 million for the quarter, in line with our plans. Our strong results in Q1 of 2012 were reflective of price mix, as described earlier.

It's important to note that a number of the capitalization initiatives completed in 2012 continue to provide enhanced cash flows through a reduced interest expense even after considering new assets acquired and their corresponding debt. We continue to pursue long-duration financing in this low-rate environment.

Accordingly, during the quarter, we completed $1 billion of capital markets initiatives to fund the growth and replenish liquidity. This included 2 wind financings for $580 million in our Ontario portfolio, both having an average duration of 18 to 19 years and a coupon of 5%.

This refinancing not only term out existing construction debt but allowed us to surface $170 million of incremental proceeds for our shareholders, significantly exceeding our original underwriting assumptions.

As Richard noted, we have a unique platform, which allows us to pursue transactions in an expedited manner. Our access to capital, operational expertise and ability to sell power in multiple markets makes opportunities, such as our acquisition of the 360-megawatt Maine hydro portfolio from NextEra, possible.

As part of this transaction, we recapitalized $700 million of sub-investment-grade project debt and holdco debt with $350 million of nonrecourse financing, mitigating potentially punitive refinancing costs and establishing a financing structure more consistent with our investment-grade strategy.

In addition, we funded the full $400 million equity commitment, as previously indicated, and expect to sell up to a 50% interest to our institutional partners. That equity commitment would return approximately $200 million into our treasury, which we expect to realize during the second half of the year.

We also issued 2 series of perpetual preferred shares in January and May of this year for proceeds of $350 million at an all-in coupon of 5%. Our strong capital base and cash flow profile allows us to access the preferred share market and provides us an attractive, low-cost source of permanent capital, which, along with our strong liquidity position, facilitates accretive growth in the business.

Current liquidity stands at $680 million, roughly the same as the year end despite having invested $600 million of equity in growth initiatives in the first quarter. We are well positioned to continue to capture growth opportunities in front of us and are focused on maintaining a strong, investment-grade capitalization profile.

That concludes our formal remarks. Thank you for joining us this morning.

Richard and I would be pleased to take your questions at this time. Operator?

Sachin, could you just give us the production in the quarter for Smoky Mountain? And to the extent you can, just what was the cash portion of noncontrolling interest related to that?

I'm not sure when you file your financials, what kind of granularity we're going to get, but just maybe to help us out with the noncontrolling interest calculation.

Sure, Bert, and I can always follow up with you to get into more detail for modeling purposes. But one is in our public disclosure, we don't break out Smoky individually.

I'll remind you that we only own 25% of Smoky. So although it's quite encouraging that we had very strong production immediately after acquisition, your point is valid in that 25% accrues to us and 75% to our partners.

That being said, we generated about 200 gigawatt hours of excess generation over long-term average from that facility in the first quarter. So you start with that, assuming that, obviously, 50 of that would accrue to us.

And again, I'm happy to talk to you afterwards to help you a little bit more.

Okay, perfect. I appreciate that, Sachin.

And just in terms of Western Wind, when will you guys be in a position to fold that into your production profile?

It's Richard, Bert. I think that, again, we feel that -- we're certainly going through the process to actually take that up.

There's about 7% of the shares left. We feel that, certainly, I think within the next 2, 3 months, we should be able to be through that process.

But you should understand, we've already started to think about these assets as part of our portfolio and treating them that way. So it shouldn't be pretty transparent to everyone when we even take it up, that, essentially, we've surfaced many of the things that we were looking for from that portfolio.

So it'll be 2 to 3 months, Richard, before you can actually start to see -- we can sort of consolidate it in our results.

Correct. About 60 days, I would think.

Okay, sure. And last question, just -- I know you guys were holding off on some re-contracting in Brazil.

I'm just wondering if you could just give us your current thinking in terms of that and rates in Brazil.

Well, we continue to see very favorable dynamics in Brazil, both from a supply-demand perspective and also from a pricing perspective. So if you recall, we've been -- our position and certainly our conviction has been that this particular market has to surface prices and certainly give price signals that is consistent with bringing on new generation.

We hadn't seen that for a while, and therefore, the market supply-demand dynamics became certainly very short. If you're familiar with what's going on down there, clearly, a lot of thermal generation is being sort of fired up at a very high cost, pushing prices up significantly.

So we feel that our conviction are being confirmed by a lot of the facts in that market. We continue to be very bullish on 2013, '14, certainly, 2014.

And we're seeing prices come up to levels that we expected. So as soon as we see prices at that level, we're trying to certainly contract the volumes that we have for those years.

And we'll go as long as possible when prices are at the level that we look for.

Just on Western Wind, in terms of the portfolio, are there any, like, noncore assets in Western Wind that you would look to kind of divest? I'm just thinking more specifically like solar or any of their, like, small wind facilities.

No. I would say the short answer to your question is no.

I think there's obviously the solar project in Puerto Rico that came with this particular portfolio. We obtained an extension from the provider of the PPA to do a more thorough assessment of the project, so we're still in that process and doing that work.

At this stage, I would say there wouldn't be any noncore assets that we could identify for you.

Okay. So just in terms of solar from a high level or in principle, are you kind of getting more comfortable with the solar now?

Because I think previously, you had an aversion to solar.

I would say an aversion may be a sort of a strong word, but certainly less favorable than hydro, for sure, and wind as well. So I think we've been growingly, with a lot of the dynamics, changing in solar, particularly in North America.

We've seen an improvement in the cost to actually put solar in place. But more importantly, I think what we've told all of you is that we're growingly, how would I say, favorable to a second-owner strategy.

If we can find the right assets with the right PPAs in the right markets and it's complimentary to our portfolio, we would consider that. And again, it just so happens when we acquired Western Wind, it had a very late-stage solar project.

So would we have sought out this project? Probably not.

But I think in the end, it's actually a pretty neat project that was very sort of late stage, close to starting construction. So we're taking this seriously and looking at that opportunity as something that we actually are capable of actually executing.

But like I say, assessing this project is very important to us. We're in that process, and we should sort of, again, know by the end of the next quarter whether or not we're favorable to it or not.

Okay. And then in terms of the kind of upcoming QuébecWind RFP, are you looking to get involved in that process or not really?

Listen, I will tell you that a lot of our portfolio of developments that we currently have in our pipeline does not include any projects in Québec. But I would also say we're not unfavorable to actually participating in the Québec RFP should there be someone that is looking for a strategic partner or someone to get involved into a late-stage project, which has been our -- more of our mode of operation, I would say, in most markets these days.

So like I say, we wouldn't be opposed in participating in it, but we don't have a pipeline of projects ready to submit to that RFP.

Okay. And then just one last question for Sachin, actually.

In terms of refinancing activities, like, are there any other near-term projects you expect to refinance with -- like, with a bond? I was just thinking in terms of, I think, Prince and Gosfield in Ontario.

Have you refinanced those projects yet? Or like...

Yes. So, Mr.

Nelson, our -- we finished with our Ontario wind portfolio. That's Prince, Comber and Gosfield.

All of them have been completed, and that's all behind us. I think we have a very good laddered maturity profile looking forward, and we're now looking into 2014 at financings that are coming due then to potentially capture the current environment.

So we're in a good position, and everything we're doing from here on in is to build more length into the portfolio.

A couple of questions. Your current available liquidity, $680 million after the pref deal, that feels like a lot.

It is down from where you were over the last year a little bit as you've grown. Can you just speak to your overall comfort level with your liquidity position, I guess, in light of all the growth opportunities you're looking at, at this point?

Sean, this is Sachin. Yes, I think we're in a good spot with liquidity.

We have really an ample amount of available funding sources to transact in a very quick way, no different than we did with White Pine and with Smoky and even Western Wind. So replenishing liquidity is a big theme that you'll see us be very focused on.

That being said, in terms of -- if you're looking for sort of target levels or anything like that, we don't really have a target level other than, I think, we generally feel secure having at least $0.5 billion of liquidity around and more than that if we can. But we're in a good spot with liquidity and mostly to capitalize on future growth initiatives.

Got it. And then you touched on, I guess, thoughts around re-contracting in Brazil ahead of some of your PPA maturities there.

Can you speak to any updated thoughts on Smoky Mountain? I guess you have some that expire the middle of next year.

And thoughts around re-contracting initiatives when you're thinking of pushing on that front.

Well, I think we are -- it's Richard. Just to be very clear, like our strategy around assets, such as Smoky, which would be no different for White Pine, the portfolio in Maine, would be really to actually do as -- maximize the value in the market that we actually are currently sort of into, which is in White Pine, into a -- more of a, call it, spot market, whereas the contracts in TVA -- with TVA expire for Smoky midway through 2014.

Our goal is really to secure long-term contracts for those particular assets when we achieve prices that certainly are much more significant than what the actual spot market offers today. So we would start that process, and we have been talking to a lot of counterparties in the actual Tennessee area, as well as North Carolina, trying to explore what the possibilities of contracts are.

And we're certainly encouraged by the market dynamics in that particular marketplace. So I can't really tell you a lot more than that, but otherwise, just to say that we're always looking.

Okay. And just finally on the NYSE listing, you've touched on, I guess, some of the holdups related to IFRS and other issues.

Can you give us any update on your thinking on timing? Is this a matter of weeks, several months?

Any context there?

Sean, I'd be hesitant to put a timeline on this other than we're encouraged by recent development, that we're getting to the late stages of this, whether that's weeks or a month or 1.5 months. I'm hoping it's within that window.

That being said, we've made significant progress this year with them. We've enhanced our disclosure.

And in large part, this is all a function of we're an IFRS issuer. We're required to be an IFRS issuer, given our listing in Canada, and the U.S.

doesn't have a lot of entities that issue an IFRS. So a lot of this is education, and that's what's taking the time, but I think we're getting close.

The U.S. government is currently reviewing some legislation, such as the Hydropower Improvement Act, to promote development of small hydro installations.

Are there any implications for BREP or sort of any opportunities that you might see with that legislation?

Well, small hydro facilities, I think, strategies have been something we've promoted for a long time in the U.S. I think the reality, however, is that the actual sites that remain undeveloped in the U.S.

are very, certainly, I think, more expensive to develop and at a much higher cost, simply because they're typically in areas where -- if you think of low-lying fruit, essentially, that's been cherry-picked a long time ago in the U.S. So I'm -- I -- we would certainly be favorable to any policy that encourage additional development of hydro facilities in the U.S.

But I would say that currently, our development portfolio is more directed at the Canadian and Brazil markets.

And I guess, like, you're going to be concentrating more of M&A-type opportunities within the U.S. market then.

That would be correct.

Many of my questions have been asked and answered. But Richard, I think in the past, you've talked about later-stage wind opportunities in Brazil.

And I think the reference there is around some of the local content requirements being, I guess, sorted out, if you will, before you buy those assets. So I wonder if you've had any discussions recently on wind-related assets in Brazil.

The answer is, Ian, very plainly is no. We still see -- one, there's an additional development transmission to a lot of these wind areas.

It's very sort of difficult. We've seen a lot of projects that have been built, which have transmission constraints that are hindering their ability to get to market.

So I think we just want to see the dust settle on that particular segment of the industry in Brazil for a while before we start getting involved in it.

Okay. Interesting.

And then I know you've got your Ontario natural gas facilities now, a part of your merger with the other BREP entity. And just wondering if you have any current thoughts on either divestiture of those assets or going through the renegotiation process, which appears to be going quite slowly here.

Our position has been pretty the same for a number of years. We continue to feel that these 2 gas plants are certainly outliers in our portfolio, but we continue to believe that we can bring a lot of value to them.

So until the time that we see we can surface value from these facilities in the future, we have no plans to divest them.

On a pro forma basis, from Q1 '12, I have your FFO on long-term average basis at $0.59. What's the corresponding number for the first quarter of '13?

And I don't know, maybe I haven't looked hard enough, but what was your actual FFO and that LTA FFO for the fourth quarter?

Michael, it's Sachin. So we did drop that disclosure as per some request from the regulators to not include that in our press release.

We're considering other ways to provide that to analysts and shareholders given your comments, which is -- it is quite helpful. What we can do is we can provide that as part of our interim report so that everybody has it.

On this call, I'd say that FFO on an LTA basis would be just under $0.60 a unit given that -- if you look at our share of generation this quarter, it was 4.6 terawatt hours versus an LTA of approximately 4.5. So we were pretty close to LTA, just slightly above LTA this quarter.

And we can give you clarity around the other quarters in our interim report that we'll file at the end of this week.

Richard, when you look at the basket of renewable power assets that you believe will come up for grabs, are these assets that are mainly supported by long-term PPAs, or are they selling electricity to the wholesale market?

I would say both, Frederic. I think we've seen -- the deal flow has been very healthy in the last year or so, and we continue to see a pretty healthy deal flow.

So I would say both are coming to market, particularly if you take the 2 asset classes. I would say wind, typically, will come with contract profile that's mostly fully contracted throughout the life cycle of the assets.

And when you look at hydro facilities, it's a bit of a -- I would say more of a merchant sort of profile if you look at the hydro facilities we've seen so far. But we've also seen hydro portfolios that have contracted better long-term contract profiles.

So I would say both.

Are you -- just wondering if -- I mean, is the competition level for those assets higher for -- I would assume they won't be higher for those that have long-term PPAs. Is that a fair assumption?

We assume that there's always competition for assets. So at the same time, obviously, there are certain types of assets with long-term contracts that have, clearly, sort of buyers that have a lower cost of capital than us.

But we've been successful in sort of acquiring wind portfolios with long-term contracts and at the end of the day, prevailing with what we believe is strong value for our shareholders. So again, I think the answer is probably yes, there's a bit more competition for contracted assets.

But still, I think in the right area with the right dynamics, we can compete.

Well, again -- once again, thank you very much for joining us this morning. We really appreciate your presence and look forward to seeing you in our second quarter results.

Thank you.