Brookfield Renewable Partners LP Stock

Good day, and thank you for standing by. Welcome to the Brookfield Renewable Second Quarter 2026 Results Conference Call and webcast. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Connor Teskey, Chief Executive Officer. Please go ahead.

Thank you, operator. Good morning, everyone, and thank you for joining us for our second quarter 2026 conference call. Before we begin, we would like to remind you that a copy of our news release and investor supplement can be found on our website. We also want to remind you that we may make forward-looking statements on this call. These statements are subject to known and unknown risks, and our future results may differ materially. For more information, you are encouraged to review our regulatory filings available on SEDAR+, EDGAR, and on our website.

On today's call, we will review our results for the second quarter and discuss how we continue to enhance our leadership position to capitalize on the significant growth opportunities in the current environment and continue creating long-term value for our investors. We will then turn the call over to Jehangir Vevaina, our Chief Investment Officer, who will discuss how we are further enhancing our capabilities in battery storage and strengthening our position as the energy partner of choice to both corporates and sovereigns. Patrick will conclude the call with a review of our operating and financial results, our balance sheet and funding activities and an update on our recently announced plan to simplify our structure into a single listed corporate entity. Following our comments, we look forward to taking your questions.

Turning to our results. In the first half of the year, we delivered record financial results, robust capital deployment and the highest levels of development and asset recycling in our history. We also further strengthened our balance sheet, ending the quarter with strong liquidity and positioning the business to capitalize on the growing opportunity set in the current market. In the second quarter, we delivered FFO of $421 million, up 13% year-over-year or $0.62 per unit, up 11% on a per unit basis. In the last 12 months, we delivered FFO of $1.444 billion or $2.14 per unit, up 14% and 11%, respectively, compared to the prior year period.

We continue to scale our development activities, commissioning 1.3 gigawatts of new capacity in the quarter and advancing our contracting initiatives, signing power purchase agreements for 2.6 gigawatts from our advanced development pipeline. We deployed or committed $5 billion into growth or $760 million net to BEP, highlighted by our recently announced acquisition of Aypa. In addition, we continue to scale our capital recycling program, agreeing to or closing sales that will generate approximately $2.2 billion of proceeds or $630 million net to BEP at strong results at or above our target returns.

Our strong execution came at the same time as the fundamentals supporting our business continue to strengthen. Global electricity demand is accelerating, and there is simply not enough new capacity coming online to keep up. This supply-demand imbalance is compounded by grid infrastructure that has not kept pace with the growing need for electricity and is not being developed quickly enough to accommodate new demand. As a result, customers are increasingly balancing their needs for speed to power, scale, cost and security of supply, while seeking partners that can deliver integrated energy solutions across multiple geographies on time and on budget. This is reinforcing the value of our global business, our broad capabilities across various mature technologies and our scale capital.

Our business today is uniquely positioned to meet our customers' evolving power needs through our global platform. We are one of the largest developers of low-cost, fast-to-market solar and wind projects. This is complemented by one of the world's largest hydro portfolios, which provides clean, dispatchable baseload power and is further enhanced by an expanding battery storage business that is increasingly critical to improving grid reliability and enabling greater renewable power penetration.

Beyond these capabilities, we have what we believe is one of the most differentiated businesses in the global power sector. Through Westinghouse, we own the world's leading nuclear technology provider. Nuclear power provides a unique combination of reliability, scale, energy security and carbon-free baseload generation, making it an increasingly important and essential component of the global energy mix. Existing reactors represent highly strategic long-life infrastructure that is difficult to replicate and the value of these assets continue to grow in the current energy market. This is being recognized globally as the sector pursues reactor life extensions, restarts and new build programs.

Westinghouse is exceptionally well positioned to benefit from this growth through its market-leading fuel services and maintenance businesses, which service approximately half the current global fleet. And going forward, we believe the most significant opportunity lies in helping deliver a new fleet of large reactors at scale, supporting the revitalization of the global nuclear industry.

During the quarter, we achieved another milestone towards that objective. The U.S. Department of Energy issued a commitment for up to $17.5 billion in loan facilities to support the procurement of long-lead equipment for the deployment of up to 10 Westinghouse AP1000 reactors in the United States. This builds on our previously announced partnership with the U.S. government to support the deployment of approximately $80 billion to build new Westinghouse reactors across the country.

The financing program is expected to accelerate deployment time lines by up to 3 years by enabling procurement of long-lead time items in advance of final investment decisions. It also helps to catalyze investment in the nuclear supply chain, improving future project execution, reducing costs and shortening deployment time lines for projects.

Our focus has now shifted from establishing the financing framework for long-lead orders to advancing individual projects. As the next step in deploying AP1000 reactors, we are actively engaged with 7 utility partners that have identified project sites and are working with them towards executing long-lead equipment orders. At the same time, we continue to work with utilities, power customers and other stakeholders to establish commercial frameworks that will support the next wave of nuclear development in the United States.

While much of our immediate focus is on advancing these projects in the U.S., we continue to see the opportunity for Westinghouse to expand in other regions as well. The recent announcement of a nuclear cooperation agreement between the United States and the Kingdom of Saudi Arabia reinforces the significant global opportunity we see for new nuclear development. Westinghouse is uniquely positioned to benefit given its market-leading technology and will compete for reactor deployments not only in Saudi Arabia but across a growing number of markets around the world.

Taken together, our access to capital, combined with our differentiated operating platform and expertise across the critical technologies needed to meet accelerating energy demand, positions us to participate in one of the largest periods of capital investment in energy infrastructure in history. Our ability to deliver integrated power solutions to the world's largest buyers of electricity will enable us to capture this growing demand and continue creating significant long-term value for our unitholders.

With that, we will turn the call over to Jeh to discuss how we are further enhancing our capabilities in energy storage, strengthening our position as the energy partner of choice.

Thank you, Connor, and good morning, everyone. As Connor discussed, the largest buyers of power and sovereigns are increasingly looking for partners that can deliver reliable integrated power solutions at scale. As a result, one of our key priorities is to continue expanding our capabilities across the technologies and markets where we see the strongest long-term demand and feel we can leverage our competencies to generate value for our investors.

One of the most compelling opportunities we see today is in battery storage. Storage is becoming an increasingly critical component of the energy mix, expanding the hours during which renewable generation can meet demand while providing flexibility and improving overall grid reliability. This is particularly important as hyperscalers and governments increasingly require reliable, dispatchable power alongside low-cost, fast-to-market renewable generation to support rapidly growing electricity demand.

Our recently announced acquisition of Aypa is a direct reflection of this opportunity, the acquisition of the largest stand-alone battery storage platform in North America for $3 billion or approximately $420 million net to BEP. Aypa's leading position across many of the fastest-growing power markets in the United States complements our large existing business and further expands our battery storage capabilities. The platform includes approximately 3 gigawatts of highly contracted operating and under construction assets, an additional 3.5 gigawatts of contracted projects and a further pipeline of more than 20 gigawatts of assets, providing meaningful runway for development to meet the growing demands of our customers and create value.

With the acquisition, we are doubling our operating and under construction battery capacity to approximately 6 gigawatts and expanding our development pipeline by over 30% to more than 80 gigawatts. Aypa, alongside our acquisition of Neoen at the end of 2024 establishes Brookfield Renewable as the leading global battery storage platform with the scale, operating and development capabilities and customer relationships to capitalize on the growing demand for storage. The acquisition is immediately accretive, reflecting our disciplined investment approach that continues to guide our capital allocation decisions, and we see meaningful opportunities to create additional value over time by accelerating development, optimizing the capital structure and commercial strategy and implementing an asset recycling program.

In addition, by adding Aypa to our existing portfolio, we further strengthen our ability to provide customers with comprehensive energy solutions across hydro, solar, wind, storage and nuclear. We believe this differentiated offering continues to position Brookfield Renewable as the partner of choice for many of the world's largest corporate and sovereign buyers of power.

With that, I'll turn the call over to Patrick to discuss our operating results, financial position and capital recycling activities in more detail.

Thank you, Jeh, and good morning, everyone, on the call. We delivered another record quarter, generating FFO of $421 million or $0.62 per unit, up 13% or 11% per unit year-over-year. Our results this quarter benefited from strong performance across the business, contributions from assets commissioned over the last 12 months and continued execution of our capital recycling program.

Turning to our segment results. Our hydroelectric business generated $336 million of FFO, with results benefiting from strong generation across our Canadian fleet and continued strong performance from our Colombian business, where favorable market fundamentals and our increased ownership in Isagen continue to support earnings growth. Colombia remains one of the most structurally attractive power markets in our portfolio, and we are well positioned to benefit going forward given our asset base and development pipeline in the country.

Results also included realized gains from the sale of a further 25% interest in a noncore hydro portfolio in Maine, which offset weaker hydrology at our U.S. operations. Within our solar and wind businesses, we generated $166 million of FFO, benefiting from contributions from projects commissioned over the last 12 months and realized gains from asset sales completed during the quarter. Lastly, our distributed energy, storage and sustainable solutions businesses contributed $84 million of FFO. Results continue to benefit from strong development activity across the portfolio and performance of our nuclear services business, Westinghouse, where FFO was up over 60% compared to the prior year, excluding a large new reactor licensing fee earned in Q2 last year.

Increasing global demand for nuclear power continues to support growth across Westinghouse's core fuel and maintenance services business, while increased energy -- engineering and design activity associated with new reactor construction is also contributing to these strong results.

Turning to our balance sheet. We continue to have a best-in-class balance sheet and our financial flexibility and access to diverse sources of scale, long-duration capital continues to be a competitive advantage. During the quarter, we completed approximately $12 billion of financings across the business and ended the period with over $5.1 billion of available liquidity across our platforms, providing significant capacity to fund development and invest in attractive growth opportunities.

The quarter included the largest private placement financing in Brookfield Renewable's history with the refinancing of our Safe Harbor hydro portfolio on the back of signing a 20-year contract with Google last year, securing approximately $1.2 billion of attractive long-term capital, resulting in an aggregate $700 million in up financing or $200 million net to BEP. Across our broader platform, Neoen completed a EUR 650 million bond issuance, further demonstrating our ability to efficiently access capital across multiple regions and operating platforms.

At the corporate level, we also completed a CAD 200 million preferred unit issuance that was upsized in response to strong investor demand and priced at the second lowest reset spread ever for this type of instrument. In addition, we are advancing contracting of our hydro portfolio in Ontario under a program run by the provincial system operator that we expect to enable meaningful up financings over the next few quarters.

With respect to capital recycling, we continue to execute our programmatic monetization strategy, generating record proceeds during the first half of the year while consistently achieving at or above our target returns. Capital recycling remains one of the competitive advantages of our business as we bring online contracted cash-flowing infrastructure assets that are in strong demand, allowing us to consistently crystallize value created through development and operational improvements and redeploy capital into higher returning growth opportunities.

During the quarter, we agreed to sell a 570-megawatt portfolio of operating solar and wind assets from our European development businesses to a newly formed European renewable power platform. Similar to the model we successfully launched earlier this year through Northview Energy, the transaction establishes a framework to continue recycling assets into this platform over time. In addition, we closed 2/3 of the sale of 2.1 gigawatts of assets to the Northview Energy platform and closed the remaining 1/3 subsequent to quarter end. We also completed the sale of an additional 25% interest in our noncore hydro portfolio in Maine, with the balance expected to close during the third quarter.

Lastly, we agreed to sell a portfolio of solar assets that we developed and small noncore hydro assets from our Isagen business in Colombia. The sales are in line with our business plans and crystallizes the value we've created through operational improvements, contract optimization and development across the platform.

Turning now to our recently announced corporate simplification. As announced last week, we are moving forward with the proposed transaction, which, subject to shareholder and unitholder approvals, will combine BEP and BEPC into a single publicly traded corporation. We expect the simplification to be tax deferred for Canadian and U.S. investors and benefit all security holders by improving trading liquidity, increasing demand for index funds and ETFs, simplifying investor analysis, broadening access to investors who prefer a more traditional corporate structure and enhancing governance. For BEP unitholders, the simplification will also eliminate partnership tax reporting forms while also providing preferential dividend tax rates for many Canadian and U.S. taxable investors.

Importantly, there will be no changes to our dividends going forward or Brookfield's ownership management fees or to BEP's preferred units or public debt, all of which will remain outstanding. There will also be no meaningful cost to the business as a result of the simplification. In closing, we believe Brookfield Renewable is exceptionally well positioned to continue delivering attractive long-term returns and cash flow growth. Our diversified global platform continues to generate growing and resilient cash flows.

Our balance sheet and liquidity position are strong, and our disciplined approach to capital allocation, development and capital recycling continues to drive significant value creation. We look forward to seeing many of you at our Investor Day on September 29 in Toronto. We'll provide an update on our strategic priorities, long-term growth outlook and the opportunities we see across our business at that time. On behalf of the Board and the management team, thank you for your continued support and investment in Brookfield Renewable. That concludes our prepared remarks.

Operator, please open the line for questions.

[Operator Instructions] Our first question comes from the line of Sean Steuart with TD Securities.

A couple of questions. Patrick, I want to start with the other income of $175 million in the hydro segment. And I get that this is associated with the asset sales down to Northview and the Maine portfolio, the portion there. Can you give us a little more context on the basis for that other income? We used to think of what was being included in FFO as gains on development potential or re-contracting potential? It feels like this is transitioning more to just booking gains on asset sales. Maybe I'm wrong there. But just as other income comprises a larger percentage of FFO going forward, what are the best ways we can think about gauging the scale quarter-to-quarter as this becomes more programmatic for you?

Yes, Sean, in terms of how we think about it, you're correct in saying that predominantly, we expect that, that really represents gains from assets which we have developed ourselves over time. Increasingly as well, we are finding opportunities as a supplement to that to dispose of assets that we consider to be noncore in nature. And so you are seeing some of that come through other income in the quarter. But we really think of it as asset gains that we've had associated with developed assets alongside certain assets that are noncore in nature and definitely not all sale gains that might come through our results in a given period, Sean.

Okay. All right. Second question is on batteries, 30% of your current advanced development pipeline that will grow once you close on Aypa. Wondering if you can give some updated perspective on how many different suppliers you're procuring from to mitigate risk and appreciating that LCOE for batteries has dropped substantially over the last 5, 6 years. What's your expectation for the LCOE trajectory going forward in the next few years?

Thanks, Sean. Make no mistake, batteries are the fastest-growing technology within Brookfield Renewable today. And we are looking to invest in and develop batteries alongside new wind and solar on a stand-alone basis and retroactively on existing wind and solar. And therefore, the opportunity set is very large. And we think now with the combination of Neoen largely in Europe and Australia and now Aypa in North America, we have the leading battery storage providers in the most attractive battery markets around the world.

Given the scale of our battery development activities, I don't think it's a stretch to say we are one of, if not the largest procurer of utility-scale energy storage equipment in the world. And therefore, we have relationships with all the major producers, both the domestic ones and the international ones. And we -- not dissimilar to what we do on wind and solar, we leverage those relationships to manage around supply chain issues, taxation, subsidies, tariffs to ensure that we can procure that equipment on time, on budget and cheaper than anyone else.

And perhaps the last comment I would make is not dissimilar to how we entered into large-scale framework agreements with the biggest suppliers of wind and solar equipment in recent years, we are now actively entering into large-scale global framework agreements with the largest producers of battery equipment around the world as well. Again, just increasing our flexibility and our differentiation in developing this asset class.

Sean, sorry, I left one thing out just on the LCOEs. They've come down very, very dramatically in the last, call it, 24 months. There are some short-term dynamics at play in terms of input costs into batteries that can cause short-term variations in those LCOEs. But we're still in the very early days of the supply chain scaling up and the technology improving. So long term, we expect LCOEs continue to go down, albeit there could be some short-term noise just dependent on input costs.

[Operator Instructions] Our next question comes from the line of Christine Cho with Barclays.

This is Liam on for Christine. With regards to the share consolidation, could you provide some details about the shareholder vote? I think I saw that the completion of the deal is not conditional on BEPC shareholder vote, but for both BEP and BEPC, Brookfield and affiliates own a large ownership stake. Can you remind us what that stake is and if those shares are going to be included in the vote? And is it a simple majority or 2/3 needed to approve?

Liam, it's Patrick here. So you're correct in saying that the simplification transaction is going to involve shareholder approvals at both the Brookfield Renewable Partners level as well as at the Brookfield Renewable Corporation level. There will be individual votes for the shareholders and the unitholders. It would require at both levels, a 2/3 of the vote actually saying yes to pass. In one of the entities, that vote would be for all outstanding shareholders and in another, it would be for all of those who vote. But 2/3 as a general rule of thumb should be your thought process with respect to passing those resolutions to do the simplification.

Brookfield Renewable is held on a look-through basis, 47% by Brookfield holders. And so you'd imagine a significant amount of the holdings with respect to the Brookfield Renewable Partners votes will be done by Brookfield Corporation and voted in favor. Secondarily, at the Brookfield Renewable Corporation level, there is a stake of roughly 10% that's held by Brookfield holders, which again would be broadly supportive of the transaction. So 2 votes, which we will be going to vote sometime in October this year. The expectation is to the extent both shareholders approve, we would look to close the transaction by the end of the year.

An important point is the transaction will go forward to the extent that BEP unitholders approve the transaction. That is the requirement. However, in the event that only BEP unitholders approve and not BEPC, we would continue to go through with the transaction. The transaction is not contingent on BEPC shareholders approving it.

I would now like to hand the call back over to Connor Teskey for closing remarks.

Great. Thank you, everyone, for your interest in Brookfield Renewable and our results this quarter. We thank you for your continued support. We look forward to seeing you at our Investor Day in September and then updating you at the end of next quarter with our Q3 results. Thank you, and have a great day.

This concludes today's conference. Thank you for your participation. You may now disconnect.

Thank you for standing by, and welcome to the First Quarter 2026 Brookfield Renewable Earnings Results and Webcast. [Operator Instructions] As a reminder, today's program is being recorded.

And now I'd like to introduce your host for today's program, Connor Teskey. Please go ahead, sir.

Thank you, operator. Good morning, everyone, and thank you for joining us for our first quarter 2026 conference call. Before we begin, we would like to remind you that a copy of our news release and investor supplement can be found on our website. We also want to remind you that we may make forward-looking statements on this call. These statements are subject to known and unknown risks, and our future results may differ materially. For more information, you are encouraged to review our regulatory filings available on SEDAR+, EDGAR and on our website.

On today's call, we will review our first quarter 2026 performance and discuss what we are seeing today in the broader energy market and what this means for our business. We will then turn the call over to Jehangir Vevaina, our Chief Investment Officer, to discuss our approach to growth through M&A and our recently announced agreement to acquire Boralex. Patrick will then conclude the call with a discussion of our operating results, financial position and funding activities, along with the potential simplification of our structure to a single listed corporate entity. Following our comments, we look forward to taking your questions.

We had a very strong start to the year, delivering record financial results, advancing key strategic initiatives, and further strengthening our balance sheet. We generated FFO of $375 million, up 19% year-over-year and 15% on a per unit basis, equating to $0.55 per unit. We deployed our committed $2.2 billion into growth or $550 million net to BEP highlighted by the privatization of Boralex, a leading global renewable platform with a significant operating base and a large and derisked development pipeline.

From a development perspective, we brought online 1.8 gigawatts of new capacity in the quarter and contracted 1.7 gigawatts of development projects from our advanced development pipeline. In addition, we continue to scale our capital recycling program selling assets that will generate nearly $3 billion of proceeds or over $800 million net to BEP at returns in line with our targets.

This includes the launch of Northview Energy which represents a new and recurring way, we are monetizing our derisked assets in North America to some of the world's largest and most sophisticated private investors. We did all of this while continuing to strengthen our balance sheet, opportunistically executing almost $4 billion of financings and ending the quarter with over $4.7 billion of available liquidity.

Now taking a step back and looking at the global energy market today, this past quarter, we saw the disruption with the outbreak of the conflict in the Middle East. First and foremost, the safety and well-being of our employees and our customers in the region remains our highest priority. We are happy to report that our teams are safe and our limited investments in the region today have not been directly impacted and are all continuing to perform. While some markets are experiencing higher energy prices as a result of the conflict, our business is largely contracted, and therefore, we do not expect a material impact on our cash flows in the near term.

What the conflict has done is put a renewed spotlight on the importance of energy security. Reliable power is the essential foundation for economic growth and without a secure, consistent and affordable supply corporations and governments cannot confidently commit to large-scale capital investments that underpin broader economic development. This is leading to governments and corporates to increasingly prioritize energy security and domestic supply, reinforcing investments in renewables, which are the lowest cost form of generation to meet demand today and do not rely on an imported fuel and nuclear, which can meet the growing need for large-scale baseload generation while offering a high degree of energy security with the ability to store significant amounts of fuel on site.

Against this backdrop of accelerating energy demand and an increased focus on energy security, we are bringing on more new renewable generation capacity than ever before. In the last 12 months alone, we commissioned over 9 gigawatts of new capacity which is nearly double the capacity we delivered just 2 years ago, and we remain on track to increase our annual commissioning run rate to approximately 10 gigawatts per year in 2027. Another great example of how accelerating energy demand is helping drive growth in our business is with our recently announced partnership with the U.S. government to accelerate the build-out of new Westinghouse large-scale nuclear reactors in the United States.

During the quarter, we made good progress advancing the development of new utility scale reactors in the U.S. with a focus on progressing key work streams, including the ordering of long lead time equipment for Westinghouse's proprietary AP1000 technology. In summary, the current environment is defined by the convergence of accelerating energy demand driven by electrification, reindustrialization and digitalization and an increased focus on energy security. Together, these dynamics are driving the need for an any-and-all approach to energy supply and creating one of the strongest backdrops we have seen for the sector and in turn, our business.

Those with operating assets and scale development capabilities stand to benefit the most. And we believe we are a leader on both fronts. Importantly, capturing this opportunity also requires significant access to capital, which has always been a key differentiator for our business. And in this regard, we believe we are stronger today than at any point in our history. As a result, we remain well positioned to deliver outsized earnings growth in the near term and more importantly, we are better positioned than ever to generate significant value for our investors over the long term.

With that, we will turn the call over to Jay to discuss our approach to growth and our recently announced agreement to acquire Boralex.

Thank you, Connor, and good morning, everyone. In the current environment, characterized by accelerating power demand and an increased focus on energy security, we're seeing some of the most compelling investment opportunities for our franchise to date both through continued execution of our 80 gigawatt advanced stage development pipeline and M&A.

And while the opportunity set is better than ever, our proven M&A playbook and disciplined approach to investing has not changed. Our competitive advantage from an M&A perspective stems from the fact that we are able to invest at scale globally across both public and private markets, acquire or invest in assets and businesses spanning the development life cycle and have deep commercial and operational know-how to drive value that others cannot. Broadening our opportunity set and allowing us to be highly selective in when and where we deploy capital.

Our first step in identifying potential opportunities is focusing on scale platforms and businesses in attractive markets with strong and growing demand for power. We look for businesses led by experienced management teams with large portfolios of assets and expertise in mature, proven technologies. Once we have identified a potential investment opportunity, we then evaluate the quality and durability of the business' cash flows ensuring highly contracted revenues with high credit quality counterparties that can underpin our investment returns.

Lastly, we assess how we can enhance the value of the platform by leveraging our access to scale capital and differentiated capabilities through the value chain. With clearly defined initiatives in our business plan to drive sustainable growth and strong long-term returns. Some of the key initiatives we can usually execute on to help drive our returns, including leveraging our commercial relationships with the largest buyers of power including integrating newly acquired platforms into our existing frameworks, such as our Microsoft and Google agreements.

We are also able to leverage our global supplier relationships to enhance procurement and deliver economies of scale as well as optimize the capital structure and provide financing for growth, supported by our strong relationships with financial institutions, significant liquidity and robust funding sources. Taken together, these initiatives and capabilities enable us to accelerate growth across our business and support the delivery of stronger return than others can deliver over the long term.

Our recently announced privatization of Boralex alongside La Caisse is a great example of our disciplined, repeatable and consistent approach to value creation through M&A. Similar to our recent successful acquisitions of Neoen in France and Australia, OnPath in the U.K. and acquisitions in the U.S. of Geronimo, Deriva, Scout and Urban Grid, where we were able to acquire excellent businesses that meet our investment criteria and execute on our value-enhancing initiatives. We're now adding a leading Canadian-based platform where we can execute our proven playbook.

Boralex's strong base in its core markets, including Canada, complement our current business and give us an opportunity to do more in this highly attractive and growing market. Under the terms of the transaction, La Caisse will increase its ownership from 15% to 30%, while BEP alongside institutional partners will acquire the remaining 70% of the business at an implied enterprise value of $6.5 billion. The transaction is subject to shareholder and normal course regulatory approvals and is expected to close later this year.

Our acquisition of Boralex is expected to contribute positively to our financial results on close, and we see significant opportunity to enhance value over time by accelerating growth and through the execution of our business plan to deliver outsized returns. We expect to add value following our acquisition by leveraging our access to capital and commercial and supplier relationships to accelerate development across the platform.

We also see an opportunity to enhance Boralex's leading position in its core markets by expanding its capabilities across technologies and delivering differentiated energy solutions, including incorporating battery storage. We expect to be able to drive efficiencies within Boralex through the sharing of best practices across Brookfield's global businesses and create value by establishing an asset recycling program within the platform, drawing on Brookfield's experience to scale asset recycling alongside development, supporting a growth model of recycling capital into higher-returning opportunities at the business.

Boralex has a strong and experienced management team, and we're looking forward to supporting them with the additional resources and flexibility that come from being part of Brookfield Renewable as we work together to grow and enhance the value of the business. Going forward, we will continue to employ a disciplined approach to capital deployment in a market where we're seeing more attractive opportunities than ever for players such as ourselves. We have the capabilities and capital to unlock value through M&A and execute development of our large project pipeline.

With that, I will pass it on to Patrick to discuss our operating results in more detail our financial position and funding activities and the potential simplification of our structure to a single listed corporate entity.

Thanks, Jay, and good morning to everyone on the call. We delivered record financial results this quarter, generating FFO of $375 million or $0.55 per unit, up 19% or 15% per unit year-over-year. In the last 12 months, we delivered $1.394 billion of FFO or $2.08 per unit, up 13% or 12% on a per unit basis compared to the prior year period. Our results reflect the strength of our diversified global platform and the continued execution of our strategy. Our hydroelectric segment generated $210 million of FFO, up almost 30% year-over-year, supported by strong generation across our Canadian and Colombian fleets and a realized gain on the sale of our 25% interest in a noncore hydro portfolio in the U.S. all of which offset weaker hydrology at our U.S. operations.

Our wind and solar segments delivered a combined $245 million of FFO, up over 60% year-over-year. benefiting from contributions from development, acquisitions and accretive capital recycling across several of our platforms. Lastly, our distributed energy storage and Sustainable Solutions businesses contributed $58 million of FFO, reflecting strong development activity and continued growth at Westinghouse, driven by new reactor design and engineering work. And organic growth within its core fuel and maintenance services business.

Turning to our balance sheet. We continue to strengthen our financial position. completing almost $4 billion of financings across the platform in the first 3 months of the year alone, extending maturities and optimizing our capital structure, while ending the quarter with over $4.7 billion of available liquidity. The quarter was highlighted by the issuance of CAD 500 million of 30-year notes, priced at the tightest spread we have ever achieved. With this issuance, we now have an average maturity on our corporate level debt of approximately 14 years, representing the longest average corporate maturity in our history.

Put simply, during a period of significant growth and value creation, our business has the most durable and stable capital structure in its history. In addition to recent successful financings, we are also progressing recontracting initiatives on a scale portfolio of hydro assets in Ontario during the quarter, which once signed, will support significant up financings that we plan to execute over the course of the year, providing additional capital to deploy into growth.

We also had a very strong start to the year from a capital recycling perspective. Closing or agreeing to sell assets expected to generate approximately $2.8 billion or $820 million net to BEP. Recently, we agreed to sell our remaining 50% interest in a portfolio of noncore U.S. hydro assets, crystallizing significant value we created under our ownership. We also completed the IPO of CleanMax in India, selling approximately half of our interest. With the IPO, we have returned all of our original invested capital while continuing to maintain exposure to the platform's long-term growth trajectory and generated a 25% IRR to date.

We also closed a previously announced sale of a portfolio of operating solar assets in the U.S. from our Deriva platform. Our asset recycling in the quarter was also highlighted by the creation of a new private renewable vehicle focused on operating renewable assets in North America, Northview Energy, which is a partnership between BCI, Norges Bank Investment Management and a Brookfield Fund. The creation of Northview Energy is in response to the strong demand we are seeing from our institutional partners for high-quality derisked infrastructure-like assets with long-term contracted and durable cash flows. We seeded the vehicle through the sale of 22 operating onshore wind and utility scale solar assets, generating total proceeds of $1.3 billion or $315 million net to BEP. Beyond the initial seed assets sold into the platform, the arrangement with BCI and Norges also established a framework to sell additionally new developed assets from our pipeline into the vehicle with a framework to acquire assets generating up to an additional $1.5 billion of incremental gross proceeds over time.

While Northview is the first vehicle of its kind, we have launched, we continue to progress similar initiatives of meaningful scale across our global platform. During the quarter, we also launched our at-the-market equity issuance program for BEPC which we paired with the buying of BEP LP units under our normal course issuer bid. In the first quarter, we issued 2.8 million BEPC shares with proceeds from the issuance used to repurchase the same number of BEP units, resulting in approximately $27 million of realized cash gains.

Lastly, as our business in the broader market continues to evolve, we remain focused on ensuring that our structure is aligned with the best interest of our shareholders. We are currently exploring whether a single combined corporate structure would better serve our investors going forward with the goal to determine if on a tax-free basis, we can create a single corporate security to enhance liquidity, increase index inclusion and create value for our investors. We expect to have more details to provide later in the year as we begin our work and look forward to updating you on our progress.

In closing, we remain focused on delivering 12% to 15% long-term total returns for our investors, supported by our strong operating platform disciplined capital allocation and our growing capital recycling program. On behalf of the Board and management, we thank all our unitholders and shareholders for their ongoing support. We are excited about Brookfield Renewable's future and look forward to sharing further updates on our progress over the course of the year. That concludes our formal remarks for today's call. Thank you for joining us this morning.

And with that, I'll pass it back to our operator for questions.

Certainly. And our first question comes from the line of Sean Steuart from TD Cowen.

I want to start with asset recycling. You guys have a lot on the go there. The magnitude is accelerating, I guess, in tandem with an expanding organic pipeline as well.

Can you give us updated perspective on the cadence and magnitude of overall asset recycling plans over the next year? And you referenced the CleanMax IRR, but broader perspective on returns you're crystallizing through those initiatives.

Thanks for the question, Sean. Three things perhaps it's worth saying about capital recycling. First, the growth in our asset recycling activities is a very natural expansion of our business that is tied on a slightly lagged basis to the growth in our organic and development activities. And as we have been building more and more wind, solar and other assets in-house, we increasingly are looking to sell those down to lower cost of capital buyers capture our development margin and redeploy that capital into accretive growth.

And while it has been growing incrementally in recent years, we do expect it to grow on a similar trajectory going forward. And it's increasingly becoming a very normal course and part of our business. In terms of targets for size and scale and amount of capital recycling, we're going to continue to be entirely driven by the values we see in the market. And if we see opportunities to sell assets at values above where we think they will produce within our portfolio, we will sell them for cash and redeploy that cash.

And therefore, we're not working to a consistent target. But perhaps to give you some direction or steer. At our Investor Day last year, we spoke about a $9 billion to $10 billion deployment of equity into growth over a 5-year period. and we would expect at least 1/3 of that capital over a 5-year period to come from asset recycling and perhaps more if we see strong values in the market. And this largely brings us to the last point where we do have a fairly robust capital recycling program ahead of us in 2026. And this is purely a result of the strong bids we are seeing for both platforms as well as stabilized assets in the current market. And therefore, I would say, on balance, the returns that we are generating through this capital recycling program, we are consistently seeing at the high end or maybe even above the high end of our target range.

Second question is with respect to the M&A opportunity set. The previous quarter's commentary was public equities offered a more compelling opportunity than private M&A opportunities, and that's consistent with the Boralex deal. Do you still see that gap in place? And post Boralex, can you qualify your continued M&A appetite?

So we continue to see both. Undoubtedly, for all the same reasons we mentioned last quarter, we continue to see opportunities in the public market. Those opportunities didn't stop and end with Boralex. The opportunities in the public market continue to exist. And similar to last quarter, it is because some companies in the public market are more constrained for capital, and therefore, not able to capture the tremendous demand environment that we're currently operating in.

We continue to see an environment where public companies with access to capital are -- that they can use to capitalize on the really attractive demand environment are performing well. and companies that don't have the right access to capital are struggling in the public markets. And therefore, we do continue to see opportunities in the public markets, but I would highlight we're seeing a pretty robust pipeline across both private and public for the remainder of the year.

And our next question comes from the line of Mark Jarvi from CIBC.

Connor, can you just clarify the comments you made about progress on the U.S. government with Westinghouse in terms of long lead items. Have those long lead items been actually signed right now and you're starting to get the support from the U.S. government at this point? If not, when does that come?

Mark, this is a very live discussion, and we hope to be in a position to announce some significant progress, not only in 2026, but in the near term. Since our announcement in Q4 of last year, we continue to see tremendous demand from nuclear both around the world, but in particularly in the United States from both the government as well as the utilities.

And that demand is coming from, I would say, all stakeholders across the environment. It's coming from offtakers, it's coming from the utilities. It's coming from the government. We continue to make significant progress on establishing frameworks under which initial orders can be made. And we hope to make some announcements in that regard...

Did that answer your question?

Yes. Sorry, just my [ catching ] broke for a second there. Next question, just -- I think there was a commentary earlier in the call, you said something about outsized ability to drive growth here. in the near term. Is the expectation then that you can exceed the 10% FFO per unit growth in the next couple of years? And if so, the primary drivers of that right now?

In the current environment, we do feel that we are well positioned to exceed our long-term target of 10%. This is driven by a number of things. Obviously, M&A in our business, the significant addition of new capacity that's coming online from organic growth.

And then lastly, our ability to recycle assets at very attractive values in the current environment. There could obviously be some timing variables on each of those things. But based on the underlying fundamentals of those 3 drivers, we feel that for both the short and short to medium term, we are well positioned to exceed that 10% per year target.

And so just to follow up on that. So obviously, asset sale gains would be a component of that. But if you put those aside, would you say the ability to drive FFO growth from the organic development and M&A side is stronger today ex asset sale gain?

Yes, we would. We would absolutely say that the operating fundamentals of our business and the organic growth profile of our business is as strong as it's ever been. And the ability to generate gains on sale above and beyond that and to recycle that capital accretively into even further growth would be upside.

And our next question comes from the line of Baltej Sidhu from National Bank of Canada.

Just on Northview Energy, how should we think about the cadence of future drop-downs and the potential mix of assets into this vehicle? And -- should we think about this as more of a steady-state annual funding lever or something that could scale more opportunistically depending on market conditions?

Thank you. From BEP's perspective, it's important to recognize that we have the option, but not the obligation to sell assets into Northview Energy. And the assets that fit that pool of capital are high credit contracted long-duration wind and solar assets in North America at prices and go-forward returns, which are very consistent with what we have seen and expect to achieve in our asset sales to third parties outside of this vehicle.

This is critical and we think immensely additive to our business because the structure helps us in derisking our development and enabling us to fund further high-margin growth. In terms of the drop-downs and the cadence of them, we'll really make 2 comments. One, the additional capital for future drop-downs we expect that to be utilized, we would say, over a 2- to 3-, 2- to 4-year period among asset sales to third parties outside of Northview.

At the end of the consumption of that initial allotment of capital, we will consider what to do next. We -- and that is a discussion for the future, we could potentially expand this vehicle, create new vehicles. But for now, we are just focused on consuming that initial commitment, which we expect will take 2 to 3 or 2 to 4 years.

Very good. And just one more for me. Just on the prevailing hyperscaler agreements that we have in place. Could you provide an update on how those agreements are progressing forward and what the potential pipeline looks and how conversations with such parties are evolving?

So there's probably 2 things that characterize our activity with the hyperscalers in the context of those agreements and more broadly. One, is the demand -- and we apologize for sounding like a broken record call after call, but demand continues to go up. It is higher today than it was last quarter. It's higher today than it was last year, and we expect it to be higher next year than it is today.

The demand for energy, particularly from the hyperscalers, particularly in their core markets, continue to increase at paces, we would say, significantly above previous market expectations. The other thing we are seeing in terms of our activities with the hyperscalers within those frameworks is our activities continue to broaden and evolve. I'll give the example of the first framework agreement we did was with Microsoft, and it was really focused on wind and solar assets. We continue to contract more and more wind and solar assets with Microsoft under that arrangement. But last quarter, we also contracted some hydros under a long-term contract with them.

And we're now to meet their evolving demands increasingly looking at including battery storage, either with the projects that we're contracting with them or as part of the broader arrangement with them. So the 2 points we would make is the demand and the activity continues to grow and accelerate, but it also continues to broaden. And we feel it's the second point where our scale and diversity continues to differentiate us in our ability to serve the largest corporate consumers of electricity.

[Operator Instructions] Next question comes from the line of Christine Cho from Barclays.

I just wanted to ask about this single combined corporate structure. You guys have been trying to increase the liquidity of Pezzi for a while. So this seems sort of like a natural progression. But can you walk through what led you to evaluate this and what's on the table other than the tax rate part of this, could you talk about other things that need to be considered in trying to do this? And would this change how you view your distribution policy?

Christine, it's Patrick. There isn't much more that we can say other than what we have already said sort of in our opening remarks as well as in our press release. But what I will say is our focus in beginning our work is really looking at, can we achieve a simplified structure while achieving a rollover on a tax-free basis for our investors and also try to capture some of the potential benefits around broader index inclusion enhanced trading liquidity that we are observing amongst corporate securities relative to partnerships.

And then lastly, just focusing on can this broadly create value for the entire investor base. But we can't really say much more than what we've already said in our opening remarks, Christine.

Okay. I appreciate that. And then are there any regions or technologies where execution risk has increased a little more than you would have thought, especially with the current administration, the surge in demand for power from hyperscalers and just general pushback from communities that we're seeing, whether it's on like permitting, interconnection and supply chain that we should be more mindful of?

Christine, I'll take the second one. Maybe just so it doesn't get missed on your previous question. We would not expect any change to the corporate structure to adjust our dividend policy. I'll just make sure we didn't gloss over that point.

In terms of what we are seeing in terms of opportunity and dynamics around different types of projects and different types of development. There's probably 2 things worth noting across our business. One -- maybe 3, I apologize. One is, this is pick your tagline any and all in all of the above type solutions. The demand for energy is going to require all types of sources. We are seeing the greatest growth in renewables because they are quick to deploy, and they are cheap, but we are going to see demand across all types of energy in terms of additions to meet the demand forecast going forward.

The second thing that's worth noting is undoubtedly the fastest-growing technology across Brookfield Renewable today is batteries and energy storage. We are seeing that within all of our existing development platforms. We are increasingly looking at stand-alone energy storage opportunities. And the rationale for this is very simple. They remove grid congestion. They don't add to it. So they solve that problem, and they are very quick to deploy.

Further, this has been -- this opportunity has been driven by the fact that CapEx for batteries and energy storage has come down 65% to 70% over the last 24 months, making these investments very economic and financially attractive. The third point, and this is probably the most insightful in terms of hitting your question head on. We are seeing a dramatic increase in interest and growth in behind-the-meter solutions.

The reality is the demand trajectory ahead of us is greater than the pace at which grids can expand. And therefore, we are going to see significant expansion of electricity demand on grids, but we're increasingly seeing demand for behind-the-meter solutions. It's important to recognize that while behind the meter solutions are perhaps growing faster on a relative basis, they are coming off a very, very low base and the vast majority of demand growth is still going to go through grids the way it has in the past, but we are seeing increasing demand for behind-the-meter solutions.

And our next question comes from the line of Nelson Ng from RBC Capital Markets.

Connor, you previously talked about how battery storage is a pretty big opportunity. When you look at your like current solar and wind portfolio, is it economic to add batteries to existing sites? And I know many of those assets are contracted. So are you seeing offtakers willing to pay that extra amount to firm up their power?

Absolutely, in no uncertain terms, yes. The value proposition for batteries in today's market is very compelling for offtakers in terms of giving them a load profile that better matches their 24/7 curve. And we're seeing it, therefore, alongside existing projects in new developments and on a stand-alone basis?

Okay. And then switching gears a bit. So in South America, I know the environment isn't great for renewable development and interest rates are really high. And you're not that active on the development front. But on the M&A side, you recently increased your stake in Isagen, but can you just talk about whether there are like M&A opportunities you're seeing in South America?

Certainly. In South America

[Audio Gap]

we will [indiscernible] there when we can do so at compelling risk-adjusted returns. Our more modest activity in South America, I would say, over the last 2 or 3 years outside of the Isagen transaction, I would say, is simply episodic. A lot of it was driven by very high hydrology and rapid build-out in Brazil. that pushed prices down and made new build in that country, a little less compelling for a period of time. We're seeing demand recover. We're seeing hydrology normalize and that market strengthen again. We continue to do significant growth in Colombia, but we do it within the Isagen platform.

So it doesn't show up as a new discrete M&A transaction. And then we've continued to do smaller transactions in other regions or other countries in the region, whether it be Chile, Central America. So it is a compelling market. It is one where the value of

[Audio Gap]

It continues to be a market we focus on. And we'll be -- continue to be a portion of our business going forward, albeit smaller than our core markets in North America and Western Europe.

And our next question comes from the line of Anthony Crowdell from Mizuho.

Just 2 quick ones, if I could squeeze in. One is a follow-up from Christine's question earlier. Is there just a time line of when you hope to have a decision made on the corporate consolidation? Is it a quarter or by year-end? And then I have a follow-up on nuclear.

Anthony, it's Patrick. We have just begun our assessment, and so we can't really give any indicative time line at this moment or really add much more at this time.

Great. And then on the nuclear, you talked about the success and the momentum going on with the AP1000 and the U.S. government. I'm just curious, where do you see the bottleneck right now before we get an announcement, is it on the utility side? Is it on the government side, regulatory side. What's the bottleneck before we get an announcement?

Perhaps this is putting a positive spin on this, but I wouldn't almost look at it as a bottleneck. The potential for new build nuclear reactors in the United States, is an immense step change to what has been done over the past 10 or 20 years. We are talking about additions that exceed 10 announcing in 1 shot additions that exceed 10x what has been done over the last 15 years.

And therefore, this simply requires obtaining alignment from all the stakeholders for that scale of a build-out. That includes the government. That includes the nuclear eligible utility operators. That includes the offtakes and that includes the financing parties. we candidly would suggest that the momentum and the traction that has been made over the last 6 or 9 months is incredibly significant and reflective of the demand for growth in the asset class because what we're looking to do in the course of 6 or 12 months far exceeds what's been done in the last 10 to 15 years. So I wouldn't say it's a bottleneck. It's just getting alignment from all the appropriate groups. And at this point, the interest and support for getting this done is pretty overwhelming.

And this does conclude the question-and-answer session of today's program. I'd like to hand the program back to Connor Teskey for any further remarks.

Thank you, everyone, for joining our earnings call this quarter. We deeply appreciate your continued support and interest in Brookfield Renewable and we look forward to updating you following our Q2 results. Thank you, and have a great day.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

Good day, and thank you for standing by. Welcome to the Brookfield Renewable Partners Fourth Quarter and Full Year 2025 Results. [Operator Instructions] Please be advised that today's conference is being recorded.

I'd now like to hand the conference over to your speaker today, Connor Teskey, Chief Executive Officer. Please go ahead.

Thank you, operator. Good morning, everyone, and thank you for joining us for our fourth quarter 2025 conference call. Before we begin, we would like to remind you that a copy of our news release and investor supplement can be found on our website. We also want to remind you that we may make forward-looking statements on this call. These statements are subject to known and unknown risks, and our future results may differ materially. For more information, you are encouraged to review our regulatory filings available on SEDAR+, EDGAR and on our website.

On today's call, we will provide a review of our 2025 performance, share our perspectives on the energy market today and provide an update on the growth outlook for our business. We will then turn the call over to Patrick, who will discuss our operating results and strong financial position as well as outline how our increasingly differentiated access to capital is providing a clear advantage for our franchise today. He will then conclude our remarks with an update on our growing asset recycling program.

Following our comments, we look forward to taking your questions. 2025 was another excellent year for our business. We delivered strong financial results, strengthened our balance sheet and most importantly, further positioned the business to continue delivering strong growth and value creation for our Unitholders going forward. This past year, we delivered $2.01 of FFO per unit, up 10% year-over-year and in line with our long-term growth target on the back of solid operating performance, expanded development activities, accretive acquisitions and growing capital recycling.

We deployed or committed a record $8.9 billion (sic) [ $8.8 ] or $1.9 billion in growth net to BEP, highlighted by the privatization of Neoen, our carve-out of Geronimo Power in the United States and our increased investment in Isagen, one of our strongest performing businesses over the last decade. We were successful in advancing our various commercial priorities, signing contracts on over 9 gigawatts of generation capacity. We also continue to scale our development activities, bringing online over 8 gigawatts of new capacity globally, a record for our business. We delivered on our asset recycling targets, reaching agreements to sell assets generating $4.5 billion of proceeds or $1.3 billion net to BEP at returns above the high end of our targets.

And we accomplished this all while strengthening our balance sheet, ending the year with $4.6 billion in available liquidity. Stepping back and looking at the broader market today, it is now clear that power is a strategic priority around the world and is the bottleneck to growth for both governments and corporates. Investment in new generation capacity over the past several years was largely about replacing carbon-intensive generation in a world of modest or even flat electricity demand growth. Today, that backdrop has fundamentally shifted. Energy demand is rising at a pace not seen in decades, driven by the multi-decade trends of electrification and renewed industrial activity. This demand growth is being further amplified by AI and the unprecedented investment in energy consumption from some of the largest companies in the world.

As a result, we are not only transitioning the grid, but adding substantial net new generation for the first time in decades. Said another way, we have shifted from a period focused on energy transition to a period focused on energy addition. This shift is driving a move from incremental grid upgrades to large-scale expansion, prioritizing fast to deploy renewables, scale baseload generation and capacity to ensure reliability.

Meeting this demand will require a mix of all the scale and efficient technologies over time. Solar and onshore wind will play a critical role given their speed to market and low cost. Hydro and nuclear are important for their baseload and scale, natural gas for its flexibility and battery solutions will be critical for ensuring the reliability of grids going forward. In this evolving environment, we have deliberately positioned our business at the epicenter of many of these technologies, allowing us to capitalize on the rapidly expanding opportunity set given our operating and development capabilities, strong partnerships and significant access to capital.

First, we are scaling our development of low-cost, fast-to-market solar and onshore wind to meet the accelerating demand for power in the near term. Over the past year, we commissioned a record amount of new solar and onshore wind capacity and are on track to reach a run rate of delivering roughly 10 gigawatts of new capacity per year by 2027, all while maintaining our disciplined approach to development.

Second, against the backdrop of growing demand for reliable baseload power, we are well positioned in the current market through our operating hydro assets and our ownership of Westinghouse. As power systems require more scale baseload generation, flexibility and enhanced reliability, the value of hydro is being recognized more than ever before. This has been highlighted by the execution of 3 20-year power purchase agreements at strong pricing with hyperscalers, a first for our business as well as the signing of the framework agreement with Google to deliver up to 3 gigawatts of hydro generation in the United States.

With respect to nuclear, only slightly more than 2 years ago, we invested in Westinghouse, gaining exposure to this critical technology for current and future electricity grids given its scale and baseload characteristics. Our investment was underpinned by Westinghouse's highly contracted infrastructure-like cash flows from its fuel and maintenance business, its strong market share and its leading and proven technology for large-scale nuclear power reactors. The current energy demand environment has reinvigorated the nuclear sector with increasing recognition of the role nuclear can play to enable economic growth and provide energy security. Perhaps the most impactful development for the sector is the recently announced landmark agreement with the U.S. government to deliver new nuclear reactors utilizing Westinghouse technology in the United States. This agreement delivers significant economic value to Westinghouse and BEP via the development of multiple reactors and then through the long-term provision of fuel and maintenance services over the 80-plus year life of those reactors.

A commitment of this scale provides long-term demand certainty, helping unlock supply chain investment and positions Westinghouse to expand deployment well beyond this initial program to both corporates and governments in the U.S. and internationally. Since signing this agreement, all parties have been working to progress the sites to construction as quickly as possible, largely focusing on site selection and the ordering of long lead time items. Against this backdrop and the known development time line for nuclear, the limited new hydro capacity available and the growing backlog for natural gas plants. We are seeing batteries play an increasingly important role in the near term with their importance set to grow over time as additional low-cost renewables come online.

Battery costs have declined by an astonishing 95% since 2010, following a trajectory similar to solar panels a decade ago. And we see a growing opportunity to deploy this technology on a contracted basis at strong risk-adjusted returns. Our recent acquisition of Neoen significantly expanded our operating footprint, capabilities and development pipeline in battery technology, and we expect to quadruple our battery storage capacity over the next 3 years to over 10 gigawatts. This growth is highlighted by one of the largest stand-alone battery storage projects globally, totaling over 1 gigawatt, which we are currently advancing through Neoen in partnership with a sovereign wealth fund.

Taken together, rising energy demand across global markets is driving the need for rapid additions of renewable capacity, large-scale baseload power and battery storage. Backed by long-term partnerships with the world's largest corporate buyers of power and governments, we are delivering more generation than ever before. By being positioned in markets with accelerating demand, combined with our global scale, significant access to capital and our operating -- and development capabilities across key technologies, we are best positioned to deliver comprehensive energy solutions across all markets at scale and are entering into a period of outsized earnings growth, generating significant value for our Unitholders over the long term.

And with that, I'll pass it on to Patrick to discuss our operating results, our diverse sources of scale capital, our balance sheet as well as our recent capital recycling initiatives.

Thanks, Connor, and good morning to everyone on the call. As Connor noted at the outset of his remarks, 2025 was a strong year across almost every metric, with the business delivering 10% FFO per unit growth, achieving our target while maintaining our best-in-class balance sheet and further positioning ourselves to generate significant growth and value going forward. In the fourth quarter, we delivered FFO of $346 million, up 14% year-over-year or $0.51 per unit. On a full year basis, we delivered FFO of $1.334 billion or $2.01 per unit, up 10% year-on-year.

Results were driven by the strength of our contracted inflation-linked cash flows across our diversified global operating fleet, growth from development activities, accretive acquisitions and scaling capital recycling. Looking across our segments, our hydroelectric segment delivered strong results this year with FFO of $607 million, up 19% from the prior year, benefiting from solid generation across our Canadian and Colombian fleets, higher revenues from commercial initiatives and gains from the sale of a noncore hydro portfolio, all of which offset weaker hydrology in the U.S.

Our wind and solar segments generated a combined $648 million of FFO, supported by contributions from the acquisitions of Neoen and Geronimo Power as well as our investment in a portfolio of contracted offshore wind assets in the U.K. This growth was offset by gains on sales recorded in last year's results, which included the sale of Saeta and the partial disposition of Shepherds Flat. In our distributed energy, storage and sustainable solutions segments, we generated record results of $614 million, up almost 90% from the prior year, driven by growth through development, the acquisition of Neoen and strong performance at Westinghouse on the back of continued momentum in the nuclear sector.

In addition to the strong results, a continued focus of ours has and will always be to maintain balance sheet strength and financial flexibility. This enables us to be opportunistic when it comes to deploying capital into growth and protecting us against downside risks. We ended 2025 with $4.6 billion of liquidity. And over the past year, we reaffirmed our BBB+ investment credit -- investment grade credit rating, which we remain firmly committed to maintaining going forward. Our rating, significant liquidity and strong financial position enable us to be very opportunistic with respect to our financing activities, which further strengthens our balance sheet.

In 2025, we executed over $37 billion in financings, a record for our franchise. These financings were highlighted by the completion of $2.2 billion in investment-grade up financings, primarily at our hydro assets, where we are seeing strong lender demand for these assets and are leveraging the benefits of newly signed long-term contracts at strong pricing. In March of this past year, we issued CAD 450 million Canadian of 10-year notes at what was our lowest spread in almost 20 years at the time. We then more recently topped this, issuing CAD 500 million of 30-year notes this January at our lowest spread ever, reflecting the strong demand for our credit and our ability to be nimble and take advantage of a favorable spread environment.

In November this past year, we also executed a $650 million, bought deal equity raise in concurrent private placement. We were successful deploying capital ahead of our targets in the 12 months prior to the equity raise, and this financing provides capital to invest even further in the expanding opportunity set in areas where we have a differentiated ability to deploy capital, such as hydro, nuclear and battery storage. Our strong balance sheet is further enhanced by the fact that we deploy our capital alongside a large pool of third-party funds raised by Brookfield Asset Management.

In 2025, Brookfield successfully completed fundraising of over $20 billion for its second vintage of its global transition fund. This capital will support large-scale investments alongside BEP that few others can make, further enhancing our access to large, high-quality M&A opportunities that help us achieve strong and consistent growth. In addition to our financing activities across the business, we are continuing to scale our capital recycling program, which is increasingly providing significant liquidity to support our growth and crystallize value creation within our business.

We continue to see robust demand from private investors for derisked infrastructure-like cash flowing operating assets. At the same time, with our scaling development activities, we have a growing portfolio of assets and platforms that we are selling on an annual basis. The size of our portfolio and our flexibility to sell whole platforms, stand-alone assets or minority stakes is enabling us to be active in the market, consistently selling at prices that deliver on our target returns. This past year, we generated record proceeds of $4.5 billion or $1.3 billion net to BEP from asset recycling alone.

This year, our asset rotation activities were highlighted by the sale of a major North American distributed energy platform, a 50% interest in a portfolio of noncore hydro assets in the U.S. and the establishment of an asset rotation program at Neoen that was successful in executing the sale of $1 billion of enterprise value of assets in our first year of ownership alone. Looking ahead, we are focusing on continuing to scale our capital recycling program and generating proceeds from sales in a more recurring manner.

In January this year, we agreed to sell a 2/3 stake in a large portfolio of recently built operating and solar assets -- wind and solar assets in North America, generating proceeds of $860 million or $210 million net to BEP and are actively progressing the sale of the remaining interest. In conjunction with this sale, we are also establishing a framework for the future sale of select assets that meet certain criteria to the same buyers. This framework, which proposes the sale of up to $1.5 billion of additional assets, further derisks our development platforms and provides a scalable source of capital to fund future growth.

We are exploring similar initiatives in other regions across our global platforms and look forward to providing updates on our progress throughout the year. We also wanted to note that after the quarter end, we announced a fully discretionary $400 million at-the-market equity issuance program for our BEPC share. We expect to use the proceeds to repurchase BEP LP units on a one-for-one basis under our existing NCIB. The purpose of the program is to increase BEPC's float and liquidity in a non-dilutive manner, while also allowing us to capture value from the persistent premium at which those shares trade, providing incremental cash to deploy into growth or buy back even more shares.

Lastly, with our record results and in conjunction with our strong liquidity and robust outlook for our business, we are pleased to announce an over 5% increase to our annual distribution to $1.468 per unit. Since Brookfield Renewable was listed in 2011, we have now delivered 15 consecutive years of annual distribution growth of at least 5% each year.

In closing, we remain focused on delivering 12% to 15% long-term total returns for our investors while remaining disciplined allocators of capital, leveraging our scale and operational capabilities to enhance and derisk our business. On behalf of the Board and management, we thank all of our unitholders and shareholders for their ongoing support. That concludes our formal remarks for today's call. Thank you for joining us this morning. And with that, I'll pass it back to our operator for questions.

[Operator Instructions] Our first question comes from Sean Steuart with TD Cowen.

A couple of questions to start with. Connor, 2026 would be the first year where you start to feed projects into the Microsoft framework agreement. Can you give us an update on progress there and the expected cadence of capacity into that deal through 2030? How is that advancing at this point?

I would make this comment more broadly on a wholesale basis beyond very simply our strong relationship with Microsoft. The demand we are seeing from corporates and in particular, the large hyperscalers is at an all-time high. And I recognize that we've been saying that for a number of years, but that demand just continues to accelerate and continues to grow. And we're seeing that in terms of the projects and the execution that we are doing with counterparties such as Microsoft on an ongoing basis.

When we launched that program, we had a defined set of projects in our pipeline that we thought would fill the 10.5 gigawatts that was initially outlined. I would say since we announced that agreement in 2025, we are seeing counterparties such as Microsoft look for power in a broader spectrum of regions and markets, particularly across the United States and even a broader spectrum of technologies to meet their power demand. So we will see growth in 2026, and we expect to see that growth do nothing but accelerate from 2026 through the rest of the decade.

Okay. And Patrick, a question on the balance sheet. You guys were busy with financing initiatives in the fourth quarter, asset recycling. When I look at the ratio of available liquidity versus the scale of the secured development pipeline or -- versus the installed asset base, those ratios have moderated a little bit in the last 1.5 years. I guess any commentary on broader comfort with the liquidity position. I appreciate you're going to be busy recycling assets. But are there ratios you're focused on to sort of sustain a comfort level with available liquidity relative to an expanding growth opportunity set?

Yes, absolutely, Sean. And I would say we're very comfortable, first of all. And when we think about our available liquidity and the business obviously having grown over the last several years, we're very focused on sort of maintaining a minimum level in and around that $4 billion mark. We're fairly focused on it. It's not a hard line by any means, but we have been at or around that or above that, I should say, for the last several years at this point. It's a level given the scope of our business today that we feel quite comfortable being at.

And to your point, as the development pipeline continues to grow, we're complementing that by scaling our capital recycling as well. So that allows us to be in and around that $4 billion mark and be very comfortable with our funding availability of our liquidity, I should say.

Okay. But when you think about $4 billion, I mean, you've been there for a while now. Your organic growth pipeline is expanded really rapidly. Is that -- I would imagine there's sort of like a dynamic element to this is the velocity of capital deployment changes for you guys. As the organic pipeline grows, is there other thoughts to that?

No, I think it's fair that as the organic pipeline continues to grow, there will be an element where we may look to increase that over time. But we're at a level right now where as we look out over the next several years, we're quite comfortable at these levels. And part of it is just because of that visibility we see on accelerating recycling.

Our next question comes from Nelson Ng with RBC Capital Markets.

So a quick question. In terms of the 8 gigawatts commissioned this year, I think about 2.5 were in North America. But obviously, there's a lot in the U.S. So when you look at developing projects in the U.S., are you still seeing any like headwinds or bottlenecks from the federal government from a permitting perspective for onshore wind and solar? Like obviously, it's a different story for offshore wind, but you're doing onshore. But are you seeing any headwinds there?

Nelson, thank you for the question. Really put this in 2 buckets. What we would say is when it comes to solar, which is the broadest component of our pipeline, solar and batteries in the U.S., we are seeing no slowdown. We are seeing an acceleration. And this is driven by solar is quick to deploy. It's cheap. It's the lowest cost form of production. And quite frankly, the corporates need the power as quick as possible.

So on solar, we are seeing no change, if anything, an acceleration, and we're trying to pull projects forward as fast as possible. On wind -- onshore wind, there has been some slowdown in permitting from the federal government, but projects are still getting done. And we've taken that into account, into our development and execution process, that's reflected in the pipeline that we present. I would say that wind is progressing slower than onshore solar in the U.S. market, but both are still getting done.

Got it. And then just switching topics a bit. So obviously, we're hearing a lot about the elevated power prices in the U.S. and the fact that you are signing more long-term hydro contracts. But when I look at your realized power prices for the U.S. hydro segment in the supplemental document, I think the realized hydro price has been flat year-over-year at about $83. I'm just wondering whether that's just due to the generation mix given that it was below average in the past year? And should we be seeing an increase going forward?

You should see an increase going forward. And there's a lot of different dynamics that flow through those numbers. But the overarching point to be made is the scarcity value of hydroelectric power is that an all-time high right now. And it perhaps gets glossed over in the breadth of our broader business. But the 3 contracts, 3 20-year take-or-pay PPAs inflation linked with some of the largest corporates around the world from our perpetual hydro assets, we have never seen demand of that scale at the prices we have seen in, I'd say, the last year, but in particular, in the last 6 months. And as those contracts get layered in, some of those contracts don't start immediately. They start in a couple of years when the existing contracts roll off, you will begin to see higher achieved contracted power prices across our hydro portfolio.

Great. And I'll try to squeeze in one more question. In terms of capital recycling, you guys mentioned that you have a, I guess, a potential framework to sell an additional $1.5 billion to some buyers -- to some existing buyers. So when you look at recycling assets are -- like how much of your customers are -- or how much of the buyers are essentially repeat customers? And should that streamline your asset recycling process going forward?

Short answer, yes, but let me provide a little bit more color. Since we started to grow our development business, I would say, in 2019 or 2020, our capital recycling activities have understandably grown on a similar trajectory, but probably on a 3-ish year lagged basis, the time it takes to pull a project out of the ground. As a result, over the past 2 or 3 years, our asset recycling proceeds have become a very consistent, recurring, predictable source of both funding and earnings for our business.

And given the trajectory of our development activities and the visibility of our pipeline today, we would expect this activity to continue going forward with 2026 being no different. Then, when it comes to the recent, we will call them frameworks we've set up in terms of asset recycling, similar to in the past how we have raised capital to facilitate a greater level of deployment into growth, we think about this as raising capital to facilitate a greater amount of capital recycling in the business. And we're pretty excited about what we've designed and executed here because what these frameworks, and we've executed one and we're pursuing others in different regions around the world that we would hope to execute in the near term, what we have done is we would say we have created almost a framework or a program to recycle newly built assets at scale quickly on a recurring basis.

And the impact to our business is it significantly derisks our development platforms around the world and the business plans we're seeking to execute, and it significantly derisks our capital recycling and funding plans for our business for the next several years.

I will go out on a limb and say, I think this is going to be a huge differentiator for our franchise. Yes, we've signed one since the end of the year, focused on North America, but we expect to sign others in the near term here. And these are very significant in terms of scale. And not only are they going to provide an accretive source of funding for our business, they significantly derisk our development activities that continue to grow.

Our next question comes from Robert Hope with Scotiabank.

So at the recent Investor Day, you spoke quite bullishly about the battery outlook, and I believe you commented that it could be 7 gigs in a couple of years. And today, you're saying it could be 10 gigs. Is the accelerating development pipeline here or an increasingly bullish outlook here in part due to the fact that you're seeing larger opportunities. The 1 gigawatt battery project for the sovereign wealth fund, is this indicative of where you think development is going, larger projects to ensure reliability for the grid?

Yes. Rob, the short answer is yes. Make no mistake, batteries are the fastest-growing part of our platform today, and we expect that to continue. But what this is really driven by is the simple fact that battery costs have come down so dramatically over the last decade. They've come down more than 60% over the last 24 months. And as a result, they are becoming an increasingly economic solution in more and more markets around the world. This dynamic continues. Costs continue to go down. Technology advances continue to be made. And therefore, we are seeing batteries as a potential solution in more and more of our projects and in more and more of our markets.

The other thing we would highlight is we do all think at Brookfield Renewable, think about battery development probably a little bit different than generation development because it can be executed faster. Much of the equipment shows up prebuilt on site. And because batteries and energy storage reduce grid congestion as opposed to add to it, there is significant incentive from grids to bring batteries online faster. Therefore, yes, we have accelerated or increased our outlook for batteries, but it's very simply just a reflection of what we're seeing across our business. And what we're doing with our sovereign wealth fund partner, we would expect to do other similar projects like that going forward.

All right. Appreciate that. And then maybe turning over to the M&A environment. You've been very successful monetizing assets. But on the other side, acquiring assets, what does that environment look like in a rising price environment as well as the power addition environment?

So perhaps I'll almost tie this back to Patrick's answer on funding a little bit. We've always been very opportunistic in terms of funding our business. And right now, we see scale capital as an increasing competitive advantage in today's market, and we see a very constructive market for deployment into growth. This is why we took the decision earlier this year to strengthen our already very strong capital and balance sheet position because we do believe we are at the start of a period of very attractive deployment into growth and M&A and very simply a broader consolidation of our space where we think we can play a very significant role.

Next question comes from the line of Baltej Sidhu with National Bank of Canada.

So Connor, just given that renewable infrastructure valuations remain compressed and you've noted the largely U.S.-based development pipeline, where are you seeing the most attractive risk-adjusted opportunities today that operating assets, late-stage development or early-stage platforms? And how do you think that mix will evolve looking into 2026?

The opportunities we are seeing are pretty broad-based around the world. But perhaps to focus on a few themes that we are seeing right now, I would perhaps highlight 3 where we're seeing the greatest volume of opportunities that we view as attractive. Absolutely, yes, public companies. That would be number one in the current environment. The second point we would highlight would be carve-outs from broader utilities or energy businesses because there are such significant capital needs across the industry, market participants are needing to choose where they will allocate their capital budgets. And to put it bluntly, some market participants can't fund 100% of the opportunities they have at their disposal, and therefore, they may look to sell divisions that they don't expect to fund all the growth opportunities in, and that could be an opportunity with us given our robust capital position.

The last point we would make is we are seeing a unique dynamic in the developer market where we are seeing a bifurcation between what we would call high-quality developers and maybe less high-quality developers. High-quality developers price at an absolute premium in today's environment given the growth trajectory of electricity demand and the value of projects that can be pulled out of the ground. However, developers that maybe don't have scale capabilities to navigate the current environment, but do have large pipelines of projects, we are seeing more attractive pricing at that end of the market and would expect to be active there in order to add projects to our pipeline that we can then contract with the demand we're seeing from our customers.

And just one more for me. Just on the [indiscernible] hydro that you had alluded to and speaking towards the Google HFA, which could see you potentially acquiring additional hydro to facilitate the entirety of the 3 gigawatts. What are you seeing in the market? And how are you thinking about it just looking forward in that regard?

Sure. What we would say when it comes to hydros is -- it very much depends on location. As mentioned, we've seen really strong demand for our hydros and premium valuations, both in contracts and in assets in markets in the U.S. like PJM and MISO. And our activities in 2025 reflect that. However, what I would say is what we are seeing is the offtakers of these hydro assets increasingly looking now beyond those 2 markets, which have really been their focus, I would say, for the last 2 years. Therefore, when we look to potentially acquire assets, we're probably looking for assets in these markets that have been viewed as non-core in the past, where we can acquire assets, execute operational improvement programs and recontract them under our framework agreements. But the biggest point I would say is it's very location specific.

Our next question comes from Benjamin Pham with BMO.

I wanted to ask a couple of questions. You mentioned the battery storage opportunity. I'm curious, a couple of things is, is the plan mostly greenfield development that you picked up a couple of -- actually quite a number of megawatts from Neoen. Or are there opportunities to also do M&A? And then I'm also secondly curious, the revenue model with storage for you specifically, is that -- do you expect to be mostly contract? Or is there an element of merchant arbitrage in there?

Ben, great question. So in terms of batteries, we view ourselves to be in quite a fortunate position because we do have a very large organic development pipeline. A lot of that did come through the acquisition of Neoen. Candidly, Neoen was the largest acquisition in the history of Brookfield Renewable. We recognize that perhaps a lot of people knew Neoen as a leading global renewable power developer. We obviously saw that and the value of that. But we thought what was underappreciated in their business is the fact that they're the leading global energy storage developer as well. And what you've seen in our first year of ownership is us really accelerating the growth in the business, but particularly on the energy storage side.

We are also looking at M&A opportunities in the battery space, but we've positioned ourselves that we can be quite discerning and balance the returns we're seeing in M&A versus the returns we're seeing in organic development. To your question about contracting, we're very excited about the evolution of what we've seen in the energy storage space, where only perhaps 2, maybe 3 years ago, a lot of the revenue models were arbitrage or merchant related. Increasingly, what we are seeing is long-term tolling or almost take-or-pay capacity contracts on newly built battery assets. And very simply as an example of the large project that Neoen is pursuing, that would be on a 100% contracted basis for the entire life of those assets. So a development and revenue profile very much in line with or potentially even stronger than what we do all day, every day on the wind and solar side.

Okay. Understood. And then can I also ask on the offshore wind side, you -- previous comments, you didn't like it for a while, maybe 7, 10 years, you got maybe more open to it, [indiscernible]. Where does Brookfield stand today then on offshore wind?

Understandably, it would be very market specific. But we are seeing some markets we won't bury the lead here. Europe, in particular, increasingly more constructive from an offshore wind perspective, and we are evaluating opportunities in the space there. That being said, as with everything, we will compare the investment profile and the risk return we see in those opportunities versus what we see elsewhere in the portfolio and only pursue them if we think we're being appropriately compensated.

Okay. If I may just to follow up on that. There's been maybe a trend of offshore wind assets in Europe as they reach end of contract life to become more merchant like. Is that something that maybe Brookfield could opportunistic take advantage of?

Certainly. And in particular, if we could bring our contracting to bear such that we could acquire those assets based on a merchant profile, but bring our power marketing capabilities to quickly derisk them through a new long-term contract. Yes, that's absolutely something we would look at. We would be clear that we've seen a couple of those opportunities, but it's not the largest opportunity set in the world today.

Our next question comes from Anthony Crowdell with Mizuho.

Just a quick one, a follow-up maybe on the previous question or 2 questions on PJM. Just several weeks ago, the Trump administration created that backstop auction, which is very light on details. I'm just curious if you think that plays maybe or pushes hyperscalers to focus more on Brookfield Renewables development side where you're bringing new generation in or the company could be opportunistic with some repricing some existing generation.

So the activity and the announcements around PJM, we very much see this as simply a reflection of the demand for energy and quite frankly, how tight the system has become, in particular, in markets with the highest levels of energy demand growth. We've been saying for years that the supply-demand imbalance has been growing materially. And this inevitable evolution leads to the immediate need for large-scale capacity to be added to grids around the world and in different markets in the United States.

So from our perspective, one of the most constructive outcomes of this discussion is that it should create a dialogue to facilitate an acceleration of new capacity coming online over the long term. That's obviously incredible for the market, and it's incredible for our business given our large pipeline of development opportunities. All that being said, we've already contracted our hydro fleet in the PJM region with the recent Google agreement, which really insulates us from any near-term market impacts depending on how these discussions and announcements related to PJM evolve in the coming weeks. But as an existing generator with contracted assets today and a development pipeline focused on meeting -- the growing and incremental demand, we view this as a step towards addressing the underlying supply-demand imbalance for our business and -- sorry, addressing the underlying supply-demand imbalance in that market, and we view that as very positive for our business.

That concludes today's question-and-answer session. I'd like to turn the call back to Connor Teskey for closing remarks.

Great. Well, thank you, everyone, for joining our Q4 conference call. We appreciate your continued support and interest in Brookfield Renewable, and we look forward to providing an update after Q1. Thank you, and have a great day.

This concludes today's conference call. Thank you for participating. You may now disconnect.