Mr. Michel Letellier reports

INNERGEX Q2 2023

Innergex Renewable Energy Inc. has provided an update on its financing initiatives, its development activities, and its operating and financial results for the second quarter ended June 30, 2023.

The corporation reached important milestones with many of its projects under construction and development, and executed on its three financing initiatives to provide more financial flexibility and support its profitable growth strategy:

1. Closed the construction financing of the 330-megawatt Boswell Springs wind project closed on July 14, 2023; a portion of $534-million (U.S.) ($704-million (Canadian)) will be applied toward Innergex's revolving credit facilities to repay the $103-million (U.S.) ($136-million (Canadian)) already invested by the corporation; the process of securing a tax equity commitment is well advanced and expected to close in third quarter 2023; in addition, the corporation closed a $49.5-million (U.S.) ($66.7-million (Canadian)) two-year non-recourse construction financing for the San Andres battery energy storage project in Chile; this construction bridge loan is expected to be repaid with the proceeds from a future long-term non-recourse financing after the facility reaches commercial operation; the remaining $12.4-million (U.S.) ($16.7-million (Canadian)) that makes up the total construction costs of the facility will be financed from Innergex's revolving credit facilities;
2. Signed an agreement to form a long-term partnership with Credit Agricole Assurances for a 30-per-cent minority interest in Innergex's portfolio of operating facilities and projects under various stages of development in France; this 128.0-million-euro ($188.4-million (Canadian)) investment, together with the partner's additional equity commitment will support Innergex's development strategy and growth in France and reduce its revolving credit facilities; the transaction is expected to close in the second half of 2023;
3. The financing of three unlevered Canadian hydro assets is progressing well and is expected to be completed in the second half of 2023.

In addition to these financing initiatives, the corporation is pleased with the progress made at its five construction projects, three of which are to be commissioned in 2023 as planned.

Projects under construction

During the second quarter, the official groundbreaking ceremony was held for the Boswell Springs project in Wyoming, United States, and the contractor is mobilized on site. The commissioning is anticipated in the fourth quarter of 2024. The amendment to the power purchase agreement (PPA) to increase the selling prices by 56 per cent for the Hale Kuawehi solar and battery storage project was approved by the Public Utilities Commission in Hawaii, and limited construction activities resumed on site. The corporation also made significant advancements with its projects under development, including signing a 30-year PPA for the Mesg'ig Ugju's'n 2 (MU2) wind project in Quebec, Canada, owned in a 50-50 partnership, and replaced its PPA for the Auxy Bois Regnier wind project in France at more favourable pricing conditions in July, 2023.

Regarding the corporation's portfolio of prospective projects, growth continues in all regions. The Canadian market teams are preparing for the request for proposals (RFPs) with Hydro-Quebec due in September and advancing other projects for the coming additional RFPs expected to commence in 2024. The Province of British Columbia also announced its intention to launch an RFP process in spring 2024 to procure 3,000 gigawatt-hours per year of new clean or renewable generation to be on-line in fall 2028 reinvigorating Innergex's initiatives to secure new prospective projects in the area.

"Our team continued to execute on operating, developing and prospecting renewable energy projects efficiently and in line with our strategy. As expected, we delivered on the milestone of closing of the construction financing of our Boswell Springs wind project, concluded an agreement to form a long-term partnership with a new financial investor in our French activities and progressed with the financing of our portfolio of three Canadian hydro assets. The arrival of a solid and recognized financial partner in France confirms the value of our assets, as well as of the development portfolio we have advanced, whose progress will be propelled by our partner's financial support and the French government's promises to accelerate the deployment of renewable energy projects in the country. It also provides us with greater flexibility to pursue our growth initiatives across all our markets," said Michel Letellier, president and chief executive officer of Innergex. "We will remain focused on delivering the financing of the hydro assets, on commissioning our assets under construction planned in 2023 and on participating in the upcoming RFPs in our markets with strong and profitable projects. We are well positioned to pursue our greenfield development strategy as the energy transition continues to unveil growing demand for our product."

Financial highlights

The second quarter benefited from the contribution of the acquisitions recently executed, namely the three solar facilities in Sault Ste. Marie, Ont., completed in first quarter 2023 and the three Aela wind farms in Chile completed in second quarter 2022, the higher production and revenues from the French wind facilities, and increased production and revenues from the hydro facilities in British Columbia. Quarterly production was below the long-term average but compensated by higher prices.

On Jan. 1, 2023, the corporation amended the presentation of its consolidated statements of earnings (refer to Section 7 (Significant Accounting Policies) of management's discussion and analysis for the three and six months ended June 30, 2023, for more information). Concurrently, certain non-international financial reporting standard measures have been amended (refer to Section 5 (Non-IFRS Measures) of the MD&A for more information).

Dividend declaration

Dividends will be paid by the corporation on Oct. 16, 2023.

Additional information

Innergex's second quarter 2023 condensed interim consolidated financial statements, the notes thereto, and management's discussion and analysis can be obtained on SEDAR+ and in the investors section of the corporation's website.

Conference call and webcast

The corporation will hold a conference call and webcast on Wednesday, Aug. 9, 2023, at 9 a.m. EDT. Investors and financial analysts are invited to view the conference by dialling 1-888-390-0605 or 416-764-8609 or by webinar at the corporation's website. Journalists, as well as the public, can listen to this conference call. A replay of the conference call will be available after the event on the corporation's website.

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 which 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 85 operating facilities with an aggregate net installed capacity of 3,676 megawatts (gross 4,226 megawatts) and an energy storage capacity of 159 megawatt-hours, including 40 hydroelectric facilities, 35 wind facilities, nine 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 9,352 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.

We seek Safe Harbor.