AES Andes ended 2021 with strong progress in its renewable transformation

- The company consolidated important advances in the execution of its strategy to become the main renewable company in South America.

- Company reported an EBITDA of US$ 1,075 million.

Santiago, February 28, 2022.- AES Andes strongly accelerated the implementation of its Greentegra transformational strategy in 2021.

During the year the company signed more than 1,000 GWh/year of long-term supply contracts in Colombia and Chile. It also completed the construction of 783 MW of renewable projects, while accelerating its decarbonization and strengthening its capital structure.

“Our Greentegra strategy continues to advance steadily, and the renewable transformation is already a reality, which allows us to build a leading company in the region, thanks to innovative, sustainable and intelligent energy solutions for our clients and the communities in which we operate.”, assured the CEO of AES Andes, Ricardo Falú.

The executive highlighted that "despite a challenging context due to the effects of the COVID-19 pandemic, the company managed to continue advancing in its transformational objectives, thanks to the efforts of all employees."

Results of the Period

The company recorded an EBITDA of US$1,075 million in 2021, an increase of US$30 million compared to 2020, which is explained in part by better hydrology in Colombia together with higher revenues recorded in Chile related to the agreement to terminate the contracts of energy supply of MEL and Spence.

During fiscal year 2021, AES Andes recorded a net loss of US$1,091 million, US$821 million higher than the net loss of US$269 million recorded in 2020. The variation is mainly associated with the accounting impacts resulting from the deconsolidation of the subsidiary Alto Maipo and impairments of Property, Plant and Equipment due to the announcements of accelerated retirement of the Angamos units and units 3 and 4 of the Ventanas Complex, effects that were partially offset by the proceeds from the sale of the associated company Guacolda Energía SpA and for income related to settlements for legal disputes.

Green Growth

In 2021, AES Andes continued to advance in the construction and development of renewable energy and battery projects, in line with its Greentegra transformational strategy.

Alto Maipo completed construction of the 531MW hydroelectric renewable complex. In December, it began its commissioning tests, injecting energy for the first time through Alfalfal II. To date, the four units of the project have already bee synchronized with the National Electric System and are in the final stages of testing to reach commercial operation at the end of March.

In the Biobío Region, the company completed the construction of the 110 MW Los Olmos wind farm and continues to make progress in the works of the Mesamávida and Campo Lindo projects, which will finish construction in 2022 to add together an additional 141 MW into the electric system.

Meanwhile, in the north of Chile, the commercial operation of Andes Solar IIa with 81MW began during 2021 and Andes Solar IIb - the largest solar + storage system in Latin America - continues to advance to complete construction in the second half of 2022.

In addition, the implementation of the Virtual Reservoir continues, an innovative technology that integrates batteries into run-of-the-river hydroelectric plants. Construction of the second phase of the 40 MW virtual reservoir has already begun, with a storage capacity of 5 hours, in addition to the 10 MW already in commercial operation at the Alfalfal 1 hydroelectric plant.

In Colombia, the firm put into operation the San Fernando Solar Park, the largest and most modern photovoltaic plant in the country. The solar complex located in the municipality of Castilla La Nueva, in the department of Meta, has 61 MW of installed capacity and supplies renewable energy to the operations of Ecopetrol and Cenit in the Eastern Plains of Colombia.

Continuing with the renewable expansion in Colombia, AES Andes announced last November the award of a new self-generation park in the department of Huila. The Brisas photovoltaic solar project with 26 MWp of installed capacity will supply renewable energy to Ecopetrol's operations.

The company also advanced in important agreements for the sale of energy. It signed long-term renewable energy contracts in Chile for more than 580 GWh/year with several clients, which makes it possible to build more wind, solar and battery projects, further accelerating the transformation of the company's matrix. Meanwhile, in Colombia, AES Andes signed a 438 GWh/year supply agreement with Gecelca for 15 years from 2025.

Decarbonization Progress

Reaffirming its commitment to the decarbonization of Chile's energy matrix, last July the company committed to the accelerated retirement of four additional coal-fired units, for a total of 1,097 MW. The Ventanas 3 and 4 units located in Puchuncaví and Angamos 1 and 2 located in Mejillones, as of January 1, 2025, will be available for retirement as soon as the safety, sufficiency and economy of the system so allow. These plants are added to the early retirement of the Ventanas 1 and 2 units, requested by AES Andes in 2020.

In July, the company concluded the sale of its stake in the 764 MW Guacolda coal-fired power plant, located in Huasco, Atacama Region to Capital Advisors.

With all this, by 2025 the Company will have withdrawn, sold or made available for retirement 72% of the coal-fired plants it had before launching Greentegra in 2018. Likewise, in the middle of the previous year the firm obtained the approval of the National Commission of Energy (CNE) to move forward with the definitive closure of the Laguna Verde Power Plant with 58 MW of installed capacity. This marks the closure of the company's last gas and diesel thermoelectric plant in Chile.

Capital Structure and Financing

In a further sign of confidence in the Greentegra strategy, on December 6, The AES Corporation -controlling shareholder of the company- announced a Public Offer for the Acquisition of Shares (OPA) to increase its participation in AES Andes. The process was in force from December 7, 2021 to January 5, 2022, with a successful result that allowed, through Inversiones Cachagua SpA, to increase its shareholder position in the company from 67% to 99%.

In July of last year Global Infrastructure Partners (GIP) joined the company as a partner in its renewable growth in Chile. AES Andes owns 51% and GIP 49% of the shares of Chile Renovables SpA, owner of Parque Eólico Los Cururos SpA and the Andes Solar IIa project, which are currently in operation. The funds contributed by GIP will serve as a source of financing for the construction of even more renewable capacity.

Great Place to Work

AES Andes was recognized by Great Place To Work as one of the best companies to work for in Chile, Argentina and Colombia. In Chile it ranked 10th among the best companies to work for among corporations with more than 1,000 workers. Likewise, the company was recognized in seventh place in the ranking of the Best Places to Work for Women 2021 in Chile.