Thank you. Hello, everyone, and thank you for joining us today.

I'd like to specify that this conference will be held in English. Members of the media are invited to ask their questions by phone after this call.

A presentation supporting today's discussion is available as we speak on the on page of our website at www.innergex.com.This call contains forward-looking statements within the meaning of applicable securities laws. Although the corporation believes that the expectations and assumptions on which forward-looking statements are based are reasonable under the current circumstances, listeners are cautioned not to rely unduly on these forward-looking statements as no assurance can be given that it will prove to be correct.

Forward-looking information contained herein is made as of the date of this call and the corporation does not undertake any obligation to update or revise any forward-looking information, whether as a result of events or circumstance occurring after the date hereof, unless so required by law. During this call, we will refer to financial measures that are not recognized according to International Financial Reporting Standards.

Please refer to the non-IFRS section of the MD&A for more information. Our speakers today will be Mr.

Jean-Francois Neault, Chief Financial Officer, who will present Q4 and year-end results; and Mr. Michel Letellier, President and Chief Executive Officer, who will review our operational highlights.

I'll now turn the conference over to Mr. Neault.

Thank you, Karine. Hello, everyone.

First, I would like to start with a commentary on the corporation's 2021 guidance achievement. The corporation has exceeded its 2021 revenues, adjusted EBITDA and adjusted EBITDA proportionate targets.

These targets were primarily exceeded due to the , Curtis Palmer and Lican acquisitions as well as higher-than-anticipated contribution from our recently commissioned facilities. Before continuing further, I would like to remind everyone that when specified normalized figures exclude the impact of the 2021 February Texas Events.

This terminology will be used throughout this presentation. My overview will therefore focus on key variances and highlights on a normalized basis, thus excluding the impact of this event.

As shown on Slide 6, the corporation financial performance posted growth in 2021 compared to 2020. Production was up 12% at 9,055 gigawatt hours.

Revenues were up 13% at CAD692.2 million. And finally, adjusted EBITDA reached CAD470.7 million, which represents a 12% increase.

Moving on to Slide 7. On a proportionate basis, the corporation financial performance posted low to mid-single-digit growth for the year 2021 over 2020.

Production proportionate was up 3% at 9,853 gigawatt hours, revenues proportionate were up 5% at CAD817.9 million and finally, also on a normalized basis, adjusted EBITDA proportionate reached CAD578.5 million, which represents a 3% increase. Continuing on Slide 8.

The corporation revenues for the year were up 22% at CAD747.2 million compared with the same period last year. The Hydro segment generated CAD48.2 million increase, which was mainly attributable to higher production at most of the facilities in BC, the Curtis Palmer acquisition, as well as the acquisition of the remaining 50% interest in E Llaima now included in the corporation's consolidated revenues.

These favorable items were partly offset by a lower contribution from some hydro facilities in Quebec due to the combined effect of lower production and lower selling prices from the recently renewed PPA. The Wind segment decreased slightly by CAD0.8 million due to lower production from the wind facilities in Quebec and France, as well as a lower contribution from the Foard City facility.

These items were largely offset by the first full year of contribution from the Mountain Air acquisition and the commissioning of the Griffin Trail wind facility. The Solar segment generated a CAD31.6 million increase in revenues, primarily due to the Hillcrest facility commissioning, including liquidated damage received from the Hillcrest EPC contractor for commissioning delays, higher selling prices at the Salvador facility combined with its first full year contribution as well as the acquisition of the remaining 50% interest in E Llaima.

These items were partly offset by lower revenues at the Phoebe solar facility due to higher air cut curtailment as well as lower irradiation despite higher average selling prices. Continuing on Slide 9.

For the year ended December 31, 2021, operating, general, administrative and prospective project expenses were up by CAD30.5 million or 16% compared with 2020. The Hydro segment recorded a CAD9.6 million increase, mostly due to the acquisitions of Curtis Palmer and the Chilean facilities.

The CAD3.1 million increase in the Wind segment is attributable to the first full year impact of the Mountain Air and the commissioning of the Griffin Trail facility. These items were partly offset by nonrecurring expenses at Foard City facility in the same period last year.

The CAD5.3 million increase in the Solar segment is explained by the acquisition of the Chilean facility and the commissioning of Hillcrest facility. Finally, the corporate activities recorded a CAD12.4 million increase, mostly explained by higher prospective projects expense.

Moving on to Slide 10. As a result of the explanations in the previous slides, the adjusted EBITDA proportionate was 20% higher at CAD673.7 million for the year ended December 31, 2021, compared with the previous year.

This increase was partly offset by a lower share of contribution from joint ventures and a lower share of contribution from the production tax credits. Both variants were due to the classification of Shannon and Flat Top facilities as assets held-for-sale following the Texas Events.

On that note, I would like to remind you that the corporation completed the sale of its 51% interest in the Flat Top facility on December 28, 2021. Moving on to the next slide.

Innergex recorded a net loss of CAD185.4 million for the year ended December 31, 2021, compared with a net loss of CAD29 million in 2020. The variance was mainly due to the unfavorable impact from the 2021 February Texas Event and the recognition of impairment charges relating primarily to the Flat Top and Shannon joint ventures.

These items were partly offset by the favorable operating segment's performance, as previously explained.Continuing on the next slide. The long-term debt as at December 31, was up CAD110.6 million compared to the previous year.

The increase in long-term debt is related largely to the debt assumed in the E Llaima and Lican acquisitions, the net draw made towards the construction of Hillcrest and Griffin Trail. This increase was partly offset by the proceeds received from the public offering of common share and the Hydro-Quebec private placement applied against the revolver credit facility.

Continuing on Slide 13. The increase in total assets results largely from the E Llaima, Lican, and Curtis Palmer acquisitions and the commissioning of the Hillcrest solar and Griffin Trail facilities.

This increase was partly offset by an impairment charge related to the Phoebe solar facility, the share of loss at joint ventures stemming from the February '21 Texas Events, the impairment loss at the Shannon and Flat Top facilities as well as depreciation and amortization. Additionally, Innergex has acquired the remaining 50% interest in E Llaima, which triggered consolidation and concurrently reduces the investment in joint ventures.

The decrease in total liability relates mainly to a favorable mark-to-market change in our interest rate swap, partially offset by the increase in long-term debt as explained in the previous slide. Finally, the increase in equity attributable to owners is mainly due to the share issues related to the E Llaima acquisition, the public offering and concurrent Hydro-Quebec private placement, as well as the investment made by Hydro-Quebec in the Curtis Palmer acquisition.

These items were partly offset by total comprehensive loss attributable to owners of the parent and dividend declared. Moving on to the next slide.

The cash flow from operating activities totaled CAD282.6 million, which represents a CAD47.5 million increase compared to the same period last year. This increase is mainly due to E Llaima, Lican and Curtis Palmer acquisitions, the incremental contribution from Hillcrest and Griffin Trail facility commissioned in 2021, as well as the first full year impact of the 2020 Mountain Air and Salvador acquisitions.

These items have also favorably impacted free cash flow, which amounted to CAD108.1 million versus CAD93.3 million in 2020. This increase in free cash flow was partly offset by an increase in debt principal repayment stemming from the E Llaima acquisition, the start-up debt repayments from Upper and Boulder Creek project loans and increase in free cash flow attributed to noncontrolling interest related both to the Curtis Palmer and Mountain Air acquisitions.

The CAD14.8 million free cash flow total increased versus 2020 resulted in a 13 percentage point improvement to our payout ratio, which amounted to 122% in 2021 compared with 135% in 2020. When excluding prospective project expenses of CAD27.4 million compared to CAD16.7 million last year, the adjusted free cash flow stood at CAD135.5 million versus CAD110 million in 2020.

And the adjusted payout ratio consequently reached 98% compared to 114% last year. Before I conclude, I would like to remind you that on February 22 on this year, Innergex has completed its previously announced Bought Deal Equity Financing of common shares.

The corporation issued an aggregate of 9.72 million common shares from which 1.28 million common shares were issued through the full exercise of the over-allotment option for an aggregate gross proceeds of CAD172.5 million. To maintain Hydro-Quebec's proportionate ownership, a total of 2.1 million common shares were additionally issued for aggregate gross proceeds of CAD37.3 million.

The net proceeds of this offering will be used to fund the closing acquisition of Aela. On that note, I will give the floor to Michel for the operational review of the past year.

Thank you.

Thank you, Jean-Francois, and good morning, everybody. I guess last night was a late night for a lot of us, fairly disturbing activities in Europe.

I won't comment too much on it, but I'm sure that a lot of you are focused on what is unfolding today and we'll have some repercussion around the economy in the next few weeks and months ahead. So, disturbing time.

So, thanks to be with us this morning. I'd like to cover a little bit of our activities during the last 12 years -- 12 years -- 12 months this morning and also commenting on our advancement versus last year in terms of development and prospective activities.

And we'll also give you the forecast for 2022 and just confirming also our long-term strategy for 2025. So, a busy year in 2021, guys, we've been very active both in terms of acquisition and also construction and advancement on our development portfolio.

In acquisition, we completed it in 2021, if we remember the 50% acquisition of -- the remaining 50% acquisition of Llaima in Chile, that was useful for us in a sense that it provided us a clear way for us to use the platform to expand our activities in Chile. Remember, we like Chile for a few reasons.

It's a stable country. It has very aggressive policy towards decarbonizing their economy.

And we think that the renewable energy will have a nice growth pattern. We think that also the pricing will be for electricity will be strong.

And that's why we want to deploy some of our resources in Chile.We acquired during 2021, the Lican hydro facility, not a big one, 18 megawatt, but again, with some storage for 4, 5 hours during the day. So, we like that profile.

Remember that our Duqueco facility does have the same capacity to move some of the electrons during the day to the evening. I think this is paramount to be successful in Chile being able to move the electricity from the sun hour to the evening or during the night.

Very also -- very happy to have been able to conclude our first transaction with Hydro-Quebec with the Curtis Palmer, two acquisition in New York State. That's the first one.

And hopefully, we'll be able to take advantage of this partnership that we have with Hydro-Quebec. Very happy with -- so far with this acquisition.

It has been over produced over the first few months. So, very happy on that one.

Commissioning activities, not a big project, but nonetheless, our first construction in -- that we had initiated ourselves in France. So Yonne II, a 7 megawatt facility that we have put in service.

Full commissioning of Griffin Trail in Texas, 225 megawatts of wind, very happy on that structure. And so far, it's producing over the expectation during the 2021, as Jean-Francois said.

Same activities also for the full commissioning of Hillcrest, 200 megawatts in Ohio with a long-term corporate PPA. So, pretty happy to have put more than 400 megawatts of renewable energy in 2021 from our construction activities.

We also have been busy in advancing Hale Kuawehi in Hawaii. Construction that started last fall.

So far, it's going as we expected. Innavik, in the north of Quebec is also advancing well.

We may have a few months of delay depending on how fast we can come back in the spring to start the construction. The COVID has been pretty bad in the north of Quebec.

So, we're watching this. But I think by the time spring comes, we should be okay to go back starting the construction.

Tonnerre, 9 megawatt storage in France is advancing well. We are hoping to be in operation by mid-March and be able to take advantage of the high -- very high volatility in price for electricity in France.

One thing that I'm very happy also is the development activities that we have seen. I'm asking you to look at the -- our MD&A in table where we are showing our updated numbers of project there.

Of course, we have the project in Hawaii that are advancing. We had a little bit of a setback in Paeahu, a judge -- local judge agreed with a local group of people that wanted to contest the permitting.

It's a setback, we are going to take a little bit of time to analyze that court case. But I think that something has been positive in that area is the fact that some of our peers have been successful in coming back to the PUC and asking price increases in their PPA rate.

So, we have been taking very good note of this and we'll be act accordingly. I think that what we have seen in last year or so regarding the inflation on costs have not been lost in terms of being noticed by the PUC and their favorable support of some increases in PPA for some of our competitors seem to be a good window of opportunity for us to take advantage of this view.

So, we'll keep you appraised on the development on that side, but I find it interesting that the PUC are open to revise PPA pricing. Big news, not a big project, but nonetheless, a very interesting project, Auxy Bois Regnier in France, a 30 megawatt project that we just got yesterday actually, the confirmation that we have won a PPA in France, that's a good news.

This is coming from our greenfield project. As you know, we have been working pretty hard in the last 5 years to develop our own greenfield project in France.

This is a good example of what we'd like to do and repeat again, I think that the team in France is now well established and we have a pipeline of projects that hopefully, will be able to bring something around 1 or 2 projects like Auxy Bois Regnier. So, very proud of the team in France to have been able to bring this and we are hoping to have that project being in service in 2024 with a very advantaged PPA pricing.

And I think that this project will contribute marginally. But nonetheless, I think those projects in France, as we said, they're not big and they're very long to develop.

But once you have a good PPA, they're fairly profitable. So, we're very happy to have Auxy Bois Regnier being now move into our advanced project and being a -- well, a PUD development project.

Same thing going back to United States, big project actually. You heard us talking a little bit about Boswell.

That's a 332 megawatt facility. We're getting very close to the final negotiation in terms of finalizing the PPA with PAC.

We are very, very advanced in all the permitting. So, this project is getting to be ready to build.

We are securing also all the supplier and have updated all the numbers for this project and it's still a financial accretive project that we like. Remember, that's a 30-year PPA with PAC and it's busbar PPA take-or-pay type of PPA.

So, we're pretty happy to bring you Boswell into our development project.Palomino on the same line of thought has advanced also as a development project for us. That's a 200 megawatt solar project, very close to Hillcrest.

So, we know the place. We have now secured the solar panel also for that project.

So, we know the cost. We have advised that our existing term sheet PPA owner that a revised price was asked.

They are taking their options. But in the meantime, if they're not selecting to continue, we are going to be looking for more -- for another potential PPA offtaker.

But the market is very, very strong out there. We have indication that it would not be an issue and we would actually have very good economics coming out of that project.

So, we're very happy to advance also Palomino. And in Chile Frontera, you know that we have this project, very advanced in terms of permitting.

We're waiting for the right time to have a PPA offtaker to start the construction. And that would cover our development activities.

Now switching on Page 21 on the prospective project, again, there we have made some tremendous advancement on that side. Very happy to report that a lot of the European or France project have been advancing.

We have also secured a 60 megawatt solar in France with -- which is not -- well, it's not huge, but for France, it's pretty big, 60 megawatts. So, very happy to have that project on the advanced stage.

Also, as we mentioned, our portfolio of project is advancing also in France. Interesting also, we have advanced in Wyoming with a 400 megawatt wind project that is actually on our weight -- on our transmission line from Boswell.

Our line is actually crossing this wind farm. So, it was a great way to access and finalize our right-of-way to interconnect Boswell.

And in the meantime, we have had -- 400 megawatt of very good wind resources that could be eventually put into the future Pac RFP.Pac is coming this year with a very strong RFP. So, we have the intention to look into this RFP and this potential project can do this.

Remember also that we have quite a bit of solar in the Northwest, really also to answer future RFP from PAC and other utility in that region. Northwest of United States will be very active in the next months and years in order to have and secure supply for renewable energy.

So, as you know, we're very well positioned with more than 1,000 megawatts of both wind and solar to answer these future RFPs. Also, very happy to report that a battery project has been put forward in advanced stage.

This is for Chile. That would be a 50 megawatt capacity with 5 hours of storage, the perfect sweet spot for Chile product.

Chile has brought a new policy to recognize capacity payment for battery. So, we intend to take advantage of this fairly supportive new policy to have battery being installed in the north of Chile.

I think this is going to be a profitable and very quick to deploy the project. So, we'll keep you appraised also on the advancement of this in the Q1 call.

Of course, subsequent event, you all have looked at our acquisition of Aela and our acquisition of San Andres in Chile, quite a bit of new capacity being installed in Chile, but the acquisition of Aela, as we said, is very complementary on our strategy, both on our payout ratio, it's going to increase our payout -- increase -- it's going to increase the cash on cash and reduce our payout ratio and I think it's sustainable and it's also going to grow, as you know, has more capacity or energy is sold under the PPA. The profitability of that portfolio will increase.

Diversification through technology will help also in location in Chile. The 50 megawatt San Andres acquisition, the solar project is also a good add-on and potentially also a candidate to have battery being installed.

We bought these solar -- that solar plant at a very deep discount. We think that adding battery to this would make it a very good project with pretty low cost to have electricity being available in the evening.

And also, it's going to help to put that portfolio in a position to sign long-term PPA. There's RFP coming in Chile.

There is the -- what they call it the DisCo, but there's also a lot of contracts with corporate industry in Chile that are becoming due in terms of their PPA expiration. So, we'll be looking to have also to answer a lot of those future call for corporate needs.

Our growth target now if we're on Page 23, for 2022, we're giving you there our forecast for the year 2022, just to make sure that everybody understands these though does not include our acquisition of Aela. We will keep you appraised on when we close it is by being a little bit conservative.

We have not closed this transaction. So, as soon as we close, we'll give you the new update for 2022 guidance.

But in general, remember that we have forecast on a 12-month run rate, about CAD85 million of gross revenue and roughly CAD56 million of EBITDA on a run rate basis. So obviously, you can add those numbers to these targets just for your sensitivity analysis.

But very proud to show that in terms of production, we're forecasting something around 18% increases, revenue, 16%, operating and general and administrative is 18%, adjusted EBITDA, 15% and adjusted EBITDA proportionate, 14%. Those number does not include Aela for the next 6 months.

So, pretty proud on this number. And of course, this is going to help reduce our payout ratio.

Note also that Jean-Francois has mentioned the adjusted numbers for our payout ratio. I think it's important for us to stress that, that we have a lot of prospective expenses built in, in our numbers when we give the payout ratio as well as full amortization of our project and some of our peers are not using the same metrics to come back with a payout ratio.

So, I just want to make sure, guys, that you understand that we put everything in terms of amortization and expenses in our calculation of our payout ratio. We might be a little bit conservative compared to some other metrics that the Street is using to make those calculations available for the public.

On Page 24, strategic plan target. We have given you those targets at the Investor Day back in September.

We're happy to give you this, well, reaffirm this guidance. And I think that you understand with the advancement on our project development and also with the success of our acquisition, namely Aela, we are advancing very well on those targets.

We're very confident that we will be able to meet and perhaps exceed these targets. So, stay tuned on our ability to fulfill these.

As our projects are being put in development in construction, they will obviously contribute to meet these targets. So, I'm very confident that these targets will be met and very upbeat in terms of our ability to continue our development.

So on this, I would open up the question period.

A couple of questions. On your 2022 guidance, I know there's a lot of moving parts in that.

But you're guiding to EBITDA growth rates that lag revenue growth a little bit, which I suppose can imply some operating margin pressure. Any context you can give us in what's forming those -- that guidance for 2022 in terms of the EBITDA growth rates?

It's Jean-Francois. Again, Sean, what probably differs from you, again, make sure you don't include any impact of the Aela acquisition on it.

So, that is totally -- that would be revised and recapped at the time of the closing of the transaction. So really, the guidance on EBITDA would reflect the full year of Hillcrest, Griffin Trail, Lican, part of a year of a tenant rise and Curtis Palmer as well.

Maybe you're referring also on our margin. But one thing is obvious is that we're spending more money in our prospective expenses.

We have raised now the budget for 2022 to about CAD34 million of prospective expenses. So, that can explain a little bit also the fact that our operating in general, administrative are going up versus the revenue.

But this is an investment. As you know, we have to put that as an expense until they're becoming a development project, and we can capitalize these investments.

So, as long as they're prospective in advanced stage, we are putting these investments in terms of expenses in our P&L. So, that might also play a little bit of role.

Again, CAD34 million of prospective investment has been put in our forecast for 2022.

Yes, that would be a part of it. With respect to your development pipeline, Michel, the implications you suggested were that any capital cost inflation seemingly you're able to pass it on to buyers given the appetite from corporate partners for PPAs.

Can you give us a bit more context on -- are you seeing any deceleration in cost pressure for wind and solar and more thoughts on overall returns for these development projects and your ability to pass those cost inflation on to buyers?

Well, I guess, Sean, this is a question that everybody has. I've been answering that question I don't know how many times in the last few months.

Pressure is there. Obviously, there's an inflation that has been building up into battery, wind and solar and tracker, what have you.

But we have said to the market is that Hawaii has been heard in the sense that we had signed these PPA, 4, 5 years ago. This is where the industry is weak.

Well, weak, is exposed is when you have a PPA that has been signed and then it takes time to develop them. So, what we said, and they're not big in Hawaii, what we said is that, yes, the -- we've been hit in Hawaii on that aspect, but we were not the only one and Hawaii has a very strong commitment for renewable energy or being 100% renewable energy by 2045.

They need these projects. And has announced some of their projects to be canceled.

Some other developers have been going back to the PUC to challenge the fact that these were not their fault. It's a little bit of a force majeure system.

And before retiring this project, they were asking for a review of PPA pricing. To our surprise and we're happy to have seen that, the PUC have been open to this idea.

So, we have potentially an opportunity to sit down with PUC and Eco and the utility over there to renegotiate a little bit the initial PPA price. So, that's a good news for us in Hawaii.

Boswell, as you know, we had the opportunity to revise our pricing last year. Since then, one of the preferred supplier had proposed us a pretty FT increases.

We dropped them and we made another RFP for a new supplier of turbine. We were happily -- I wouldn't say surprise, but we're happy to see that with new technology, new deployment of these wind turbine on site, we became able to almost capture all the return.

And it was a fantastic project. Now, it's a great project.

So, we're happy to have Boswell online, again, 30 years. And the other order exposure we had with Palomino.

Palomino, we were happy to have an opener with our offtaker. We have selected to put them and increase price.

And they had a window of 6 months. They have elected to wait for 6 months.

It's becoming due in April. And in April, we're free to market this project.

In the meantime, in Ohio solar project have not been built and the demand is very, very strong. So, the inflation has 2 sides, right?

It has a side on the cost for us, but it also has a side on the cost of electricity. We've seen price increasing all over the place.

So, I think that this moment in time is good for our industry to some degree, natural gas price has gone up. Oil has gone up and project has not been built.

And the one that are getting built have now the ability to have a price negotiation that for a change in the last 4 or 5 years, we've been on the smaller piece of the stick. Now, I think the table is a little bit turning in our favor to be able to pass through some real cost in the price of electricity.

We are seeing that in France. We're seeing that in U.S.

We're seeing that in Chile. We're seeing that in Quebec.

So, I think that for a change, renewable energy is seeing an upbeat on the price of electricity going up. So, inflation is a concern, but guys, inflation has two sides.

It means that also energy is going up. Renewable energy is going up.

So, for new projects, we'll build whatever new input that we have in terms of supply and we'll keep our margin. And if something, we may be able to have better margin going forward.

So, I'm very upbeat. You heard me in the past being a little bit conservative on price of electricity.

That has now changed towards, I think, price of renewable energy are seeing good future in the next few years.

Just following up on Sean's question. If we're looking at inflation, how much inflation are you baking into your operating costs for next year in your guidance?

And are you seeing some inflation in your revenues as well? How much of the inflation is coming through indexation on your contracts?

Inflation is positive -- in our operating facility, inflation is positive. 1% of inflation we would have to have an update, but it's over -- it's probably close to CAD3 million net cash flow for us.

So, inflation is good in our operation. We have also remember that the PTC in the U.S.

are 100% inflated, right? So any project, Boswell, as an example, benefited from a 7% inflation rate last year or 6.9% inflater built in, so Griffin Trail and Foard City.

All the PTC have been indexed by 6.9% last year. So, inflation for our operating facility, Rupert, just one, make sure that we reassure our investor we'll fully cover inflation and our operation is positive for us.

And then looking at the increased budget for development expenditures, how much of that is going to be invested in the 730 megawatts you've highlighted as advanced projects? And how much goes into the earlier stage pipeline?

That's a tough one. I don't have all these specific numbers in the split.

But theoretically, as projects, like I said, when the project becomes in the development, then it's a little bit more of a construction cost because the project is going to be built. So, we -- and that's a good point, right?

When we put a project in a development, we are feeling very strongly that these projects will be built and will be put in COD. So, just want to make sure that you guys when you see these move from advanced stage to PUD or project under development, it's because we have a very strong case that these projects will be built.

I don't have the full --.

The way you should see it Rupert is, first, that CAD34 million Michel referred to is not including any project under development. So, Boswell budget and those projects are excluded of that.

So, that covers only for the prospective pipelines. And this is by country.

I mean, overall, so we're increasing the budget for U.S.A. and France as well.

So, pretty much all region, maybe besides Canada is probably stable or declining. But overall, I think we -- the majority of the growth of this investment is in the U.S.

and France.

And I think, Rupert and to everybody, this year and the near -- the year to come are going to be very busy. Quebec has now changed their view on their surplus, now they need energy.

They have called 2 RFPs and it's only the beginning. BC will eventually come up with the numbers because they're wrong in their assumption right now.

The BC Hydro has not taken into account an aggressive plan from the BC government to meet their target reduction of CO2 emission. So, they'll have to revise their long-term forecast as well.

The Northwest in the States are very, very busy for future RFP. So, I think that that's why we think it's prudent for us to invest in early-stage projects to advance a lot of our prospective project in order to be ready for answering these future call.

Remember that these future call will be type of PPA that we like. This is a concern that some of you have mentioned in our exposure to merchant pricing.

We all said that we like long-term PPA. We want to have long-term PPA, but we are mindful sometimes that timings to have these long-term PPA are very important.

You're seeing what's happening guys, in the price of electricity in France. You're seeing what's happening also in Chile.

So, we are mindful sometimes of the opportunity and the timing to secure long-term PPA and when the time will be good, we'll secure long-term PPA also for Chile.

And just one quick follow-up on the SG&A inflation. Can you remind us what are your opportunities for streamlining your costs and maybe bringing some operations maintenance in-house?

Yes. We've done that with the project, a new project.

Remember that went bankrupt and Siemens Gamesa was charging fairly hefty price. We decided to keep that in-house.

Any time we have the opportunity and it seems to be more profitable to do so, we'll do it. In Aela as an example, we have over there 3 layers of contract.

One is asset management. It's -- we have a window of opportunity to buy or cancel these contract, we will do this.

But when we have a good value from the turbine supplier and it makes sense, we agree. We like to have the long-term supplier to be aligned with us.

So, we don't like the short-term FSA from, let's say, only 5 years because we don't think that the turbine supply is aligned with us. If we have 15, 20 years and they're reasonable in pricing, we feel more comfortable because then they're partnering with us on a long-term basis and they have to also meet the availability contract.

So, we're always looking Rupert to do these things. They're not huge usually gain.

But sometimes what we like also is that we make sure that at the same cost, we think we have a better view and we think we are all managing our asset on a better long-term view. So -- but they're not huge in terms of operating savings.

Given some of your portfolio activity that you've done recently in Chile, I guess, maybe just a perspective on how big could you be in that market? And then as you build out, let's call them, regions of influence in certain areas where you've got a concentration of assets, what kind of portfolio benefits do you have for whether contracting longer-term PPAs with greater flexibility?

Or just being able to cover off assets, should there be deficiencies in production?

Well, we like -- Chile is a little bit different. There is some PPA that are the typical take RFP.

But usually, they're fixed synergy PPA. So, a fixed synergy PPA is tricky.

Very difficult to answer these with only one facility unless you subscribe your P99 or very small portion of your output. So, we like the fact that when you have different technology, you have a diversification in the production during the day, during the season.

So, that's why we like the fact that in Chile by hiding -- not hiding, but adding. When we change a profile of production, we like and we are stressing that Chile is a market where evening and early mornings will be very difficult market to meet by sun, of course.

So, we think that adding battery and adding a hydro facility with some flexibility in moving 4, 5 hours of production during the day is very valuable. So, that's basically it.

I mean the more diversification you have, the more serious also the corporate offtaker will take your offer. And to answer your question, how big can we be?

We're 655 megawatt in Chile, that represent roughly 15% of our portfolio -- total portfolio. As we grow also in U.S., you've seen that we have quite a bit of activities in the U.S., in Canada eventually.

So, 15%, 20% is something that we feel comfortable. That can move and it can be bumpy depending on the opportunity and depending on how fast we can develop also in Canada, in United States.

But of course, we would not end up with 50% of our portfolio in Chile. So, we want to be balanced.

We said that this is something that applies to the total portfolio as well. We like the diversification of location, diversification of client, dissification of technology.

So, something potentially up to 20% can be interesting. You see that we're forecasting to be over 5,000 megawatt by 2025.

So, can we be close to 1,000 megawatts in Chile by that date? Yes, potentially.

And then just maybe taking the Chilean example and thinking about just portfolio concentration in certain areas, obviously, in the Northeast, given the legacy position in Quebec, how do you think about the portfolio bulking up in really the broader Northeast and then also in the Pac Northwest given some of your asset positions?

Well, we like the Northeast because our partner, Hydro-Quebec has a lot of knowledge, expertise and ability also to trade in that area but it's crowded. Northeast is very crowded.

So, we obviously want to develop there. Permitting is not easy in New York.

Permitting is not easy in Maine. So, we are mindful of that.

We were putting some effort there and we would love to be able to be successful and increase our presence there. We're putting more effort also on the greenfield development in Northeast.

But we were, I guess, better positioned in the Northwest and we're taking advantage also. And when you can secure 25, 30 years PPA in the Northwest, there are as good as in the Northeast, right?

And then maybe one final one as you build up these regions of concentration to a greater degree, it creates more simplicity of the company. But do you get tempted or at least think about selling off portions of the portfolio to be maybe a bit more asset-light?

We would -- well, I guess that we all saw what Boralex did -- announced yesterday or this morning. And I think this is a great I would say, a great proof of these assets are very, very valuable.

So, there's always a decision to sell a portion of those to recycle the capital. That's a strategy you could do.

We are mindful. We're taking good note of the valuation that has been done.

But I want to stress the fact that investors should note also that the underlying asset of our portfolio are very valuable. And I think there's a disconnect between the evaluation in the stock market versus the asset itself, that will eventually hopefully be a little bit arbitrage over the time.

We are in the business of being diversified, being a good long-term developer and create growth and appreciation on our capital for our shareholders. We're mindful that equity is expensive.

So, that's why what we've done in Chile, if you know this, we have taken the advantage of this acquisition to actually re-leverage our position in Chile, and we...

Do you hear us?

I can, yes.

Okay. Okay.

So, what we've done is that we have taken the opportunity to actually put 200 -- over $200 million more in U.S. dollar in leverage in Chile.

So, we actively did a recycling of our capital in Chile, we're keeping our own ownership of these assets and having a cost of capital around 4%. So, I think that we have been opportunistic in this way.

Like I said, very mindful that equity is the most expensive. But once you've sold your project, your asset, they're not yours anymore.

And I think that for us, building on size and diversification is also an important feature, not to be paramount, but it's an important feature to have a good diversification in our portfolio, both in region and technology.

Just wanted to start off with the -- with Chile, I think you have a hydro project or several projects that have moved to the advanced stages of development. Just wondering if you could talk about that and how it impacts your sort of portfolio approach or go-to-market strategy in Chile?

Yes. Frontera has been there for a bit of time when we did the acquisition of E Llaima, Frontera was there.

Frontera has all their permits, has also an interconnection reserve. What we said to the market is that we won't have a good PPA for that asset.

So, it's good. We own it.

We have a lot of land. If you remember, Frontera is a run of the river, but we're creating some kind of a lake and there's a ton of real estate that we had acquired.

So, there's also a real estate play in Frontera. Don't want to complicate the answer at all, but timing is important for us.

We have another small 3 megawatt . This is only an addition on the existing outflow dam on Duqueco facility.

So, that's a very -- just a small tuck-in profitable one, but not a big project.But the one that we are now put in mid-stage in our prospective is a project called San Carlos. San Carlos 150 megawatt, it's a run of river facility, but this one will have the ability to have 45 hours of storage, more cost effective cost to build lower than Frontera and it's upstream from Frontera.

So, what we like is probably in sequences is to develop San Carlos and then take advantage of the storage capability of San Carlos to make it beneficial for Frontera. But we have been happy in the development that we have done in Chile.

There's not that many hydro facility or project to be developed in terms of being commercially viable in Chile. Those 2 are and we're happy to have them, we'll be prudent before starting construction there.

We want to make sure that we have the long-term PPA secured to support this decision of investment.

Just on Palomino, I think the project has been laid -- pushed back a number of quarters now, maybe into 2024. Just wondering if you can talk about milestones that PPAs being negotiated?

What if you have to go back to market to find another offtaker? I'm just trying to get a sense of the time line for Palomino.

Well, usually, PPA were very complicated 2, 3 years ago. Now, in Ohio for that product, this is not our concern.

We have plenty of initial discussions and we're very comfortable with the PPA offtaker in Palomino. But let me know the process in Ohio is fairly long.

And one thing was a concern also is that a lot of projects were submitted in the queue for interconnection in the last few years. And that has kind of overwhelmed the utility out there.

And they are thinking of looking now instead of having one project, they want to take it as a bundle. And that would have complicated the timing for interconnection in Palomino.

We were successful in having Palomino being -- how we say, grandfathered for the solar interconnection. So, we're happy to see this.

We're getting -- finalizing the interconnection. And it's just it takes a little bit more time in terms of public hearing and development and permitting activities.

But we're maintaining, yes, 2024 for Palomino. Like I said, PPA is not an issue anymore.

We have a strong demand for that product for that timing in Ohio.

I guess, at the portfolio levels, you've kind of shifted the allocations now with the Aela acquisition. Just wondering what are your thoughts going forward on maybe M&A in either in France or in the U.S.

to maybe try to rebalance some of the portfolio? And what's the focus today?

Is still kind of cash-on-cash lower the payout? Or are you looking more to potentially enter new markets or expand more into solar?

What's the priority list?

The priority. Well, we -- priority is making sure that whenever we're making an acquisition, we are trying to strike the 2 strategies, diversification and also accretion.

To your point, you're implying that Chile is oversized for our portfolio. It's 15%.

France is around 9%. France acquisition, as you might see, valuation are very, very high.

So, we're not necessarily ready to deploy M&A in France. The cost of equity is really low in France.

We have the ability to develop our own project and create value there, perhaps acquisition of early-stage project and help smaller developer to bring their project to further development. This is a possibility in France.

We've had the opportunity to secure 2 early-stage projects for 40 -- around 40 megawatts last year. We didn't make a big story of this because it's really early stage.

But this type of acquisition in France, we can do. And as you've seen, we've been active in last year in 4 or 5 processes in the States.

We've been successful with Curtis Palmer. We're expecting to see some activities also in M&A in the United States.

It's very competitive in the states, of course, but we think that when we can find the right product at the right time, we'll be able to be successful in the United States. There's not that many activities for selling assets in Canada.

We've seen a few processes being announced. But I think that in the States, you've seen the development profile that we have, if we can bring 400 megawatt or 500 megawatt of new project every year or so in the United States, I think that this is a great way for us to diversify through our own pipeline of development.

But I'm happy with Chile, the 15% to, like I said, up to 20%. We think that can be a target that could be good in our diversification.

Love to be able to develop faster in France, but France is long process, smaller project, but they're profitable. Again, very happy to see that we have our first material contract being signed in France, 30 megawatt, 20 years contract.

Very happy to have that now in France.

Thank you very much, everybody.

Thank you, everybody.

Thank you.