An overview of what it happening in the Yeildco space because of the sector downturn and the near insolvency of Yieldco sponsors SunEdison (Terraform Power and Terraform Global) and Abengoa (Abengoa Yield.) Delivered at Yieldcon in NYC on December 3rd.

1. The Status of the Yieldco
 Tom Konrad Ph.D. CFA
History
What is a YieldCo
Importance and Purpose
Common YieldCo features
Yieldco Assets
Benefits and Drawbacks

2. Tom Konrad Ph.D., CFA
Editor,
Freelance writer
Hedge fund focused on green economy.
Head of research.
Green Global Equity Income Portfolio
A seed fund with a dividend income strategy and a 2 year track record.
Currently talking to potential sponsors about turning it into a mutual fund.
Portfolio Manager.

3. Disclosure
Tom Konrad, The Green Global Equity Income
Portfolio, and/or the JPS Green Economy
Fund own the following securities discussed:
 US: BEP, EVA, HASI, PEGI, NYLD/A, GLBL,
CAFD, ABY, TERP
 Canada: CSE, RNW, AQN, INE

4. Disclaimer
Past performance is not a guarantee or a reliable
indicator of future results. This presentation contains
the current opinions of the author and such opinions
are subject to change without notice. This presentation
is intended for informational purposes only. Forecasts,
estimates, and certain information contained herein
should not be considered as investment advice or a
recommendation of any particular security, strategy or
investment product. Information contained herein has
been obtained from sources believed to be reliable, but
not guaranteed.

5. What Is A Yieldco?
 Developer perspective: A way to raise
(cheap) equity capital for clean energy
projects
 Investor perspective: A company that pays a
(usually) high dividend based on cash flow
from clean energy assets.

6. What isn't a Yieldco?

7. IPO Timeline: North American
Yieldcos

8. What Is A Yieldco
 A Yieldco...
 Raises capital in public markets
 Generates most of its cashflow from clean
energy ownership
 Distributes most of its cashflow to
investors.
 Funds clean energy projects with low-cost
capital from income seeking public
investors.

9. What Parts of the ”Yieldco Model”
Will Survive?
 Public Company
 Owns Clean Energy
Assets
 Uses most cashflow
for distributions
Has developer
sponsor(s)
Right of first offer
(ROFO) on projects
High dividend growth
rate

10. Contagion: All In The Family

11. The Sponsor Effect

12. The Sponsor Effect

13. Yieldcos With Internal
Development See Opportunity
 Brookfield
Renewable Energy
Partners (BEP)
 We're very
different
 Opportunity
set will get
better
Hannon Armstrong
Sustainable Infra.
(HASI)
Pullback is an
opportunity
May allow higher
returns on
investment

14. Yieldcos With Private Sponsors
Expect To Stand Out
Pattern Energy Group
(PEGI)
Volatility in Yieldco
sector is very healthy
Enviva Partners LP
(EVA)
We expect to
execute... and
differentiate
Enviva from
the rest of the
pack.

15. Yieldcos With Solvent Sponsors:
'The Model Works For Us'
 NextEra Energy
Partners (NEP)
 The Yieldco
model can
work with the
right structure
and a world
class sponsor.
8point3 Energy
Partners (CAFD)
Both sponsors
commited to
dropdowns.
No need to issue
new equity.

16. Yieldcos With Solvent Sponsors:
Continuing As Planned
TransAlta Renewables
(TSX:RNW)
– Will continue asset
drop-downs
– 'Stable & moderate
growth'
– Announced 2nd
ROFO
on Nov. 23.
NRG Yield (NYLD)
Investment
proposition
unchanged.
Continue to target
15% DPS
growth

17. Abengoa (ABGB) Seeks Creditor
Protection: Trouble for Abengoa
Yield (ABY)
 Some project debt has cross-default clauses
which may be triggered.
 US DOE can restrict distributions from
Solana & Mojave solar projects.
 Spanish insolvency law may lead to
reexamination of intercompany transactions
– were valuations fair?

18. SunEdison Grabs Control at TERP
and GLBL
 November 25th:
 SUNE replaces TERP & GLBL CEO, CFO,
Chairman, and members of Corporate
Governance and Conflicts Committees
 Conflicts committee members resign –
'unable to protect interests of stockholders'
 GLBL will focus on acquisitions from
SUNE

19. GLBL Cash Rescues SUNE- Is it
good for GLBL?
 November 26
 GLBL Acquires 425 MW of Indian solar
farms for $0.51/W plus assumed debt from
SUNE
 The projects replace 'lower yielding'
planned acquisitions from initial portfolio,
which have been cancelled.
 SUNE uses cash to pay down margin
loan.

20. Implications for Terrafrom
Power/Global shareholders
 Less oversight of conflicts of interest
 Weaker balance sheets and credit ratings as
capital is used to support SunEdison
 Potential to acquire cheap assets from
desperate seller.

21. Predictions for Future Yieldcos
 More focus on yield - less on growth.
 Yieldcos will be one of many capital raising
options.
 More independent Yieldcos, multiple &
private sponsors (BEP, HASI, CAFD, PEGI)
 Yieldcos with weak/highly leveraged
sponsors will trade at significant discount.

22. What's Coming
 Italy: Enel buying back Yieldco
 China: Canadian Solar Yieldco IPO
 Weak sponsor, needs cash
 Unlikely to succeed
 India: Sebi considerling Yieldco

23. Questions?
 Tom Konrad Ph.D. CFA
 tom@altenergystocks.com