AES Andes S A : accelerates its renewable transformation with solid execution of its Greentegra strategy

August 5, 2022

Santiago -AES Andes achieved a solid performance and significant progress in the execution of its Greentegra transformational strategy during the second quarter of 2022.

The company recorded an EBITDA of US$204 million in the second quarter of 2022, 12% higher than last year, excluding the recognition in 2021 of extraordinary non-recurring income associated with the termination of the contracts of the subsidiary Angamos with MEL and Spence, subsidiaries of BHP. Without the adjustment, the consolidated EBITDA had a negative variation of 42%.

The positive variation in Argentina is largely explained by the recognition of lower costs for insurance recovery as a result of a incident that occurred in 2021, which was offset by lower revenues from Energía Base market sales, due to lower availability in the first quarter of 2022.

Meanwhile, in Colombia, the positive variation was explained by higher margins in contract sales associated with an increase in prices, which was partially offset by the effects of the devaluation of the Colombian peso and lower sales in the spot market.

In terms of the first half of 2022, the company reported an EBITDA of US$390 million, 10% higher than the EBITDA of the first half of 2021 adjusted for the BHP effect mentioned above and 43% lower without said adjustment.

During the first half of 2022, AES Andes recorded a net profit of US$117 million, US$383 million higher than the net loss of US$266 million for the same period of the previous year.

The CEO of AES Andes, Ricardo Falú, stated that "more than 4 years after the launch of our Greentegra strategy, the company continues to carry out its projects and is taking very important steps in new energy solutions to become the main provider of energy solutions renewable energy in South America.

The executive highlighted that "this year we have brought online important renewable plants, Alto Maipo, Los Olmos and a large part of the Mesamávida wind farm. The Campo Lindo wind farm in the Biobío Region and Andes Solar IIb in northern Chile will soon enter operation soon.

Relevant facts to date

Portfolio decarbonization

Accelerating the execution of its Greentegra transformational strategy and reaffirming its commitment to the decarbonization of the country's energy matrix, the company ceased and definitively disconnected Unit 1 of the Ventanas Power Plant from the National Electric System in July, after receiving approval by part of the National Energy Commission (CNE) to specify their retirement in advance.

AES Andes had requested last June the authorization to exempt itself from the 24-month period to report the withdrawal, disconnection and cessation of the operation of the aforementioned unit, which has been in the Strategic Reserve State (ERE) since December 29, 2020.

This is added to the fact that last year, the firm announced that units 3 and 4 of Ventanas and Angamos 1 and 2, located in Mejillones, will be available for retirement as of January 1, 2025 as soon as the safety, sufficiency and economy of the system so allow in an agreement signed with the Government of Chile. Meanwhile, Ventanas Unit 2 is expected to cease operations this year.

With this announcement, by 2025 the company will have closed, sold or delinked from contractual obligations 72% of its coal-fired generation units and will continue with the necessary efforts to make its customers' energy supply more sustainable.

Financial restructuring of Alto Maipo

Last May, Alto Maipo completed the financial restructuring process under Chapter 11 in the United States. The judge in charge of handling the case approved the reorganization plan proposed by the company and its creditors, ending the process that began in November 2021.

This is a plan that guarantees the financial viability of Alto Maipo for the future and will allow it to continue generating emission-free energy with its four units, which are already in commercial operation after a successful synchronization with the National Electric System (SEN).

Energy exchange between Chile and Argentina

In June, the governments of Chile and Argentina authorized the permit that allows energy exchanges between the two countries through the Interandes electrical interconnection line of AES Andes.

This exchange will be carried out through the Interandes transmission line (345 KV) that goes from the Andes substation (Chile) to the Cobos substation (Argentina). The agreement establishes that the systems will not operate in sync, but that generation components will be allocated in an electrically isolated manner, from Chile during the day, and from Argentina during the night.

During the day AES Andes will send power from solar plants and during the night, Chile will receive power from natural gas plants from Argentina. In this way, up to 200 MW of diesel generation can be displaced overnight, reducing systemic costs and emissions from the local electricity sector. It will also allow reducing curtailment of renewable energy in the Chile during the day.

AES Andes generates and sells energy in Chile, Colombia and Argentina with the mission of improving lives by accelerating a more secure and sustainable energy future. The Company operates 5,101MW in the region along with a large portfolio of renewable energy projects under development. AES Andes is one of the main generation companies in the region, with a diversified portfolio that includes hydroelectric, wind, solar, energy storage, biomass, gas and coal plants.

In Chile, AES Andes owns and operates 3,356MW, made up of 2,129MW thermoelectric, 771MW hydroelectric, 277MW wind, 104MW solar photovoltaic and 13MW biomass, in addition to 62MW of energy storage batteries, seawater desalination plants, transmission and gas pipelines in Chile. AES Andes also owns hydroelectric and solar plants in Colombia with a total capacity of 1,102 MW and a natural gas combined cycle plant in Argentina with an installed capacity of 643 MW. AES Andes is 99% owned by The AES Corporation.

To learn more about AES Andes, visitwww.aesandes.com