Mr. Jean Trudel reports

INNERGEX ACHIEVES CONSTRUCTION FINANCIAL CLOSE OF ITS BOSWELL SPRINGS WIND PROJECT

Innergex Renewable Energy Inc. has closed a $534-million (U.S.) ($704-million) construction financing, including a $203-million (U.S.) ($268-million) 10-year non-recourse term loan with BNP Paribas, Credit-Agricole CIB, Export Development Canada and MUFG Bank Ltd., acting as joint lead arrangers, for the construction and operation of the 329.8-megawatt Boswell Springs wind project, located in Wyoming, United States. Under the Inflation Reduction Act, the project is potentially eligible for up to 120 per cent of production tax credits (PTCs), which includes a 10-per-cent energy community PTC bonus and a 10-per-cent domestic content PTC bonus. The project is eligible to benefit from the energy community tax credit PTC bonus due to its location in an energy community, as defined in the Inflation Reduction Act. The eligibility for the 10-per-cent domestic content PTC bonus is currently being evaluated, which should further enhance the profitability of the project.

Highlights:

• Closing of a $534-million (U.S.) ($704-million) construction and term financing and a $49-million (U.S.) ($65-million) letter of credit (LC) facility for the construction and operation of the 329.8-megawatt Boswell Springs wind project;
• The project qualifies for the energy community PTC bonus, which increases PTCs by 10 per cent;
• On-site construction activities have started, and contractors are now fully mobilized on site;
• Tax equity investment process is well advanced and expected to close during Q3 2023.

"We are very pleased with the terms of this financing as it demonstrates the strong market confidence in Innergex's technical and financial abilities to develop high-quality and well-structured assets that generate attractive cash flows," said Michel Letellier, president and chief executive officer of Innergex. "In addition, the passage of the Inflation Reduction Act brings more competitiveness to the renewable energy sector than ever before by providing bonus credits for certain clean energy projects. In the case of Boswell Springs, we were pleased to learn that the project is eligible for the energy community PTC bonus, and we decided to seize the opportunity to finance the bonus credits to substantially improve the investment economics, over and above associated cost increases."

The procurement of wind turbine generators from GE Vernova's onshore wind business has been secured and the permitting process has been completed. The EPC (engineering, procurement and construction) contracts have been executed with Mortenson to act as the balance of plant contractor for the wind farm and AEI as the EPC contractor for the transmission line. Construction teams are now fully mobilized on the site and have begun work on both the balance of plant and generation line.

Total construction costs of the Boswell Springs wind project have been revised to include financing costs related to the energy community PTC bonus qualification and additional construction and development costs. Total construction costs are expected to amount to $576-million (U.S.) ($760-million), of which $103-million (U.S.) ($136-million) has already been financed through Innergex's revolving credit facilities. A substantial portion of the first drawdown under the Boswell Springs construction loan will refund equity overcontributed by Innergex and be applied as a repayment of the revolving credit facility. The process of securing a tax equity commitment is well advanced and expected to close during Q3 2023.

Operating cash flows from the Boswell Springs wind project are expected to reach approximately $22-million (U.S.) ($29-million) on an annual basis. In addition, the project is expected to benefit from 110 per cent of the PTCs, which should contribute an annual approximative $42-million (U.S.) ($55-million), indexed to inflation over a 10-year period, including the 10-per-cent energy community PTC bonus.

The electricity to be produced by the Boswell Springs wind project will be sold under a 30-year, 320-megawatt busbar power purchase agreement signed with PacifiCorp, a Berkshire Hathaway subsidiary. The commercial operation date is scheduled for Q4 2024.

About Innergex Renewable Energy Inc.

For over 30 years, Innergex has believed in a world where abundant renewable energy promotes healthier communities and creates shared prosperity. As an independent renewable power producer that develops, acquires, owns and operates hydroelectric facilities, wind farms, solar farms and energy storage facilities, Innergex is convinced that generating power from renewable sources will lead the way to a better world. Innergex conducts operations in Canada, the United States, France and Chile and manages a large portfolio of high-quality assets currently consisting of interests in 87 operating facilities with an aggregate net installed capacity of 3,692 megawatts (gross 4,243 megawatts) and an energy storage capacity of 159-megawatt-hours, including 40 hydroelectric facilities, 35 wind facilities, 11 solar facilities and one battery energy storage facility. Innergex also holds interests in 13 projects under development with a net installed capacity of 760 megawatts (gross 849 megawatts) and an energy storage capacity of 605-megawatt-hours, five of which are under construction, as well as prospective projects at different stages of development with an aggregate gross installed capacity totalling 8,883 megawatts. Its approach to building shareholder value is to generate sustainable cash flows, provide an attractive risk-adjusted return on invested capital and distribute a stable dividend.

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