ARLINGTON, Va. and MONTRÉAL,
Sept. 17,
2024 /PRNewswire/ -- The AES Corporation (NYSE: AES)
today announced that it reached an agreement to sell a 30% indirect
equity interest in AES Ohio to CDPQ, a global investment group, for
approximately US$546 million, with
closing expected in the first half of 2025.
This agreement expands upon AES' existing partnership with CDPQ
at AES Indiana and creates a similar ownership structure for the
two utilities, with no change in management or operational control
of AES Ohio. CDPQ's partnership with AES, now in both US utilities,
will bring continued funding to support the high growth ahead.
"We have a successful track record of incorporating strategic
partners into our businesses in support of our growth initiatives.
CDPQ has been a long-term partner to AES and this transaction marks
another strong step forward for AES Ohio, enabling the increased
capital investments needed to support our customers' growing
needs," said Andrés Gluski, AES President and CEO.
AES Ohio plans to invest more than US$1.5
billion from 2024 through 2027 to improve system
reliability, through extensive investment in transmission
infrastructure and grid modernization improvements (AES Ohio's 2023
rate base was US$1,564 million). AES
Ohio recently reached a settlement agreement for Phase 2 of its
Smart Grid program, which, if approved by the Public Utilities
Commission of Ohio (PUCO), will
enable investment of more than US$240
million over a four-year period to deploy smart technology
that will support impactful system improvements. As a result of
these needed investments, AES Ohio anticipates compound annual rate
base growth in the mid-teens through 2027.
Additionally, AES Ohio sees potential for incremental investment
to support growing data center demand, which could increase peak
load on the system by more than 50% by the end of the decade. This
growth will be transformational for the utility and demonstrates
the value of AES' broader portfolio in serving important technology
customers.
As part of this agreement, CDPQ is committed to funding its pro
rata share of AES Ohio's near-term capital requirements to support
AES Ohio's extensive growth plans, including incremental growth
opportunities stemming from new data centers in the service
territory.
"AES has been an excellent partner of CDPQ for the last 10
years, and we've supported the company in the modernization and
decarbonization of its operations at AES Indiana since then," said
Emmanuel Jaclot, Executive Vice President and Head of
Infrastructure at CDPQ. "We now embark on a new chapter in our
relationship to support the growth plans of AES Ohio. This is a
unique opportunity to invest alongside a trusted partner in
regulated assets that play an important role meeting the
electricity demands for over half a million customers."
"AES Ohio is committed to delivering reliable energy to enable
economic growth and job creation," said Ken
Zagzebski, President of AES' Utilities business. "Our
partnership with CDPQ will support AES Ohio's US$1.5 billion investment program to strengthen
our system and support the growing demand from data centers, which
has the potential to increase our peak load by more than 50% by the
end of the decade."
This transaction is expected to close in the first half of 2025.
With this sale, AES will have achieved over US$2.7 billion of its US$3.5 billion asset sale target for 2023 through
2027.
This agreement is subject to customary regulatory approvals,
including from the Public Utilities Commission of Ohio, the Federal Energy Regulatory Commission
and the Committee on Foreign Investments in the United States.
About AES
The AES Corporation (NYSE: AES) is a Fortune 500 global energy
company accelerating the future of energy. Together with our many
stakeholders, we're improving lives by delivering the greener,
smarter energy solutions the world needs. Our diverse workforce is
committed to continuous innovation and operational excellence,
while partnering with our customers on their strategic energy
transitions and continuing to meet their energy needs today. For
more information, visit www.aes.com.
About CDPQ
At CDPQ, we invest constructively to generate sustainable
returns over the long term. As a global investment group managing
funds for public pension and insurance plans, we work alongside our
partners to build enterprises that drive performance and progress.
We are active in the major financial markets, private equity,
infrastructure, real estate and private debt. As at June 30, 2024, CDPQ's net assets totalled
CAD 452 billion. For more
information, visit cdpq.com, consult our LinkedIn or Instagram
pages, or follow us on X.
CDPQ is a registered trademark owned by Caisse de dépôt et
placement du Québec and licensed for use by its
subsidiaries.
AES Safe Harbor Disclosure
This news release contains forward-looking statements within the
meaning of the Securities Act of 1933 and of the Securities
Exchange Act of 1934. Such forward-looking statements include, but
are not limited to, those related to the completion of the
transactions contemplated by the agreement with CDPQ, the execution
of our future investment plans and future earnings, growth and
financial and operating performance. Forward-looking statements are
not intended to be a guarantee of future results, but instead
constitute AES' current expectations based on reasonable
assumptions. These assumptions include, but are not limited to, our
expectations regarding (a) the completion of the transactions
contemplated by the agreement with CDPQ on the anticipated terms
and timing or at all, including the receipt of regulatory approvals
and (b) accurate projections of future interest rates, commodity
price and foreign currency pricing, continued normal levels of
operating performance and electricity volume at our distribution
companies and operational performance at our generation businesses
consistent with historical levels, as well as the execution of
PPAs, conversion of our backlog and growth investments at
normalized investment levels, and rates of return consistent with
prior experience.
Actual results could differ materially from those projected in
our forward-looking statements due to risks, uncertainties and
other factors. Important factors that could affect actual results
are discussed in AES' filings with the Securities and Exchange
Commission (the "SEC"), including, but not limited to, the risks
discussed under Item 1A: "Risk Factors" and Item 7: "Management's
Discussion & Analysis" in AES' 2023 Annual Report on Form 10-K
and in subsequent reports filed with the SEC. Readers are
encouraged to read AES' filings to learn more about the risk
factors associated with AES' business. AES undertakes no obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise, except where
required by law.
Any Stockholder who desires a copy of AES' 2023 Annual Report on
Form 10-K filed February 26, 2024
with the SEC may obtain a copy (excluding the exhibits thereto)
without charge by addressing a request to the Office of the
Corporate Secretary, The AES Corporation, 4300 Wilson Boulevard,
Arlington, Virginia 22203.
Exhibits also may be requested, but a charge equal to the
reproduction cost thereof will be made. A copy of the Annual Report
on Form 10-K may be obtained by visiting AES' website
at www.aes.com.
AES Website Disclosure
AES uses its website, including its quarterly updates, as
channels of distribution of AES information. The information AES
posts through these channels may be deemed material. Accordingly,
investors should monitor our website, in addition to following AES'
press releases, quarterly SEC filings and public conference calls
and webcasts. In addition, you may automatically receive e-mail
alerts and other information about AES when you enroll your
e-mail address by visiting the "Subscribe to Alerts" page of AES'
Investors website. The contents of AES' website, including its
quarterly updates, are not, however, incorporated by reference into
this release.
AES:
Investor Relations Contact: Susan
Harcourt
703-682-1204 • susan.harcourt@aes.com
Media Contact: Amy Ackerman
703-682-6399 • amy.ackerman@aes.com
CDPQ:
Media Contact:
+1 514-847-5493 • medias@cdpq.com
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SOURCE The AES Corporation