Our Operations
We invest in renewable power and sustainable solutions assets directly, as well as with institutional partners,
joint venture partners and through other arrangements. Across our business, we leverage our extensive operating
experience to maintain and enhance the value of assets, grow cash flows on an annual basis and cultivate positive
relations with local stakeholders. Our portfolio includes assets for which we have access to a priority growth
pipeline that if funded would provide us the opportunity to own a near-majority share of the business.
Our global diversified portfolio of renewable power assets, which makes up over 97% of our business, has
approximately 31,800 MW of operating capacity and annualized LTA generation of approximately 93,000 GWh and
a development pipeline of approximately 155,400 MW.
The table below outlines our renewable power portfolio as at December 31, 2023:
Hydroelectric
North America
United States(2)
.................................................
Canada .............................................................
Colombia(3)
........................................................
Brazil .................................................................
Wind(4)
North America
Europe ................................................................
Brazil .................................................................
Asia ....................................................................
Utility-scale solar(5)
Distributed energy & storage(6)(7)
Total renewable power
..............................................
.........................
River
Systems
Facilities
Capacity
(MW)
LTA(1)
(GWh)
30
19
49
11
27
87
—
—
—
—
—
—
2
89
139
33
172
22
43
237
55
56
34
27
172
211
6,408
7,028
2,921
1,361
4,282
3,053
940
8,275
6,830
1,432
809
1,874
10,945
7,073
5,129
31,422
11,963
5,178
17,141
16,143
4,811
38,095
21,872
4,814
3,539
5,534
35,759
15,211
2,989
92,054
Storage
Capacity
(GWh)
2,559
1,261
3,820
3,703
—
7,523
—
—
—
—
—
—
5,220
12,743
(1)
(2)
(3)
(4)
(5)
(6)
(7)
LTA is calculated based on our portfolio as at December 31, 2023, reflecting all facilities on a consolidated and an annualized basis from
the beginning of the year, regardless of the acquisition, disposition or commercial operation date. See Item 5.A “Part 9 – Presentation to
Stakeholders and Performance Measurement” for an explanation on our methodology in computing LTA and why we do not consider LTA
for our pumped storage and certain of our other facilities.
Includes three battery storage facilities in North America (36 MW).
Includes two wind plants (32 MW) and five solar plants (100 MW) in Colombia.
Excludes 303 MW of wind capacity with an LTA of 719 GWh included in our sustainable solutions segment.
Excludes 118 MW of solar capacity with an LTA of 247 GWh included in our sustainable solutions segment.
Includes a battery storage facility in North America (10 MW).
Includes nine fuel cell facilities in North America (10 MW) and pumped storage in North America (633 MW) and Europe (2,088 MW).
We also have investments in our sustainable solution portfolio comprised of assets and businesses that enable
the transition to net-zero through established but emerging technologies that require capital to scale, and in
businesses where we believe we can leverage our access to capital and partnerships to accelerate growth. This
portfolio includes our investment in Westinghouse (a leading global nuclear services business) as well as
investments in an operating portfolio of 57 thousand metric tonnes per annum (“TMTPA”) of carbon capture and
storage (“CCS”), 3 million Metric Million British thermal units (“MMBtu”) of agricultural renewable natural gas
(“RNG”) operating production capacity annually and over 1 million tons of recycled materials annually. Our
sustainable solutions development pipeline includes opportunities to invest in additional projects with 14 million
metric tonnes per annum (“MMTPA”) of CCS, 1.6 million tons of recycled materials, roughly 3.5 million MMBtu
of RNG production capacity annually, a solar manufacturing facility capable of producing 5,000 MW of panels
annually and a 1 million tons per annum green ammonia facility powered entirely by renewable energy.
The following table presents the annualized long-term average generation of our renewable power portfolio as
at December 31, 2023 on a consolidated and quarterly basis:
GENERATION (GWh)(1)
Q1
Q2
Q3
Q4
Total
Hydroelectric
North America
United States .............................
Canada .......................................
Colombia(2)
..................................
Brazil ...........................................
Wind ...............................................
3,402
1,235
4,637
3,697
1,183
9,517
9,191
3,469
1,489
4,958
4,048
1,198
10,204
9,162
2,171
1,236
3,407
3,944
1,214
8,565
8,088
2,921
1,218
4,139
4,454
1,216
9,809
9,319
11,963
5,178
17,141
16,143
4,811
38,095
35,760
Utility-scale solar ...........................
3,239
4,348
4,502
3,123
15,212
Distributed energy & storage .........
646
888
856
599
2,989
Total ...............................................
(1)
22,593
24,602
22,011
22,850
92,056
LTA is calculated based on our portfolio as at December 31, 2023, reflecting all facilities on an annualized basis from the beginning of the
year, regardless of the acquisition, disposition or commercial operation date. See Item 5.A “Part 9 – Presentation to Stakeholders and
Performance Measurement” for an explanation on our methodology in computing LTA and why we do not consider LTA for our pumped
storage and certain of our other facilities.
Includes two wind plants (174 GWh) and five solar plants (248 GWh) in Colombia.
(2)
The following table presents the annualized long-term average generation of our renewable power portfolio as
at December 31, 2023 on a proportionate and quarterly basis:
GENERATION (GWh)(1)
Q1
Q2
Q3
Q4
Total
Hydroelectric
North America
United States .............................
Canada .......................................
Colombia(2)
..................................
Brazil ...........................................
Wind ...............................................
2,224
1,010
3,234
843
1,008
5,085
2,511
2,359
1,210
3,569
922
1,020
5,511
2,449
1,466
980
2,446
900
1,034
4,380
2,145
1,950
959
2,909
1,016
1,035
4,960
2,555
7,999
4,159
12,158
3,681
4,097
19,936
9,660
Utility-scale solar ...........................
849
1,225
1,278
825
4,177
Distributed energy & storage .........
Total ...............................................
(1)
207
8,652
303
9,488
292
8,095
189
8,529
991
34,764
LTA is calculated based on our portfolio as at December 31, 2023, reflecting all facilities on an annualized basis from the beginning of the
year, regardless of the acquisition, disposition or commercial operation date. See Item 5.A “Part 9 – Presentation to Stakeholders and
Performance Measurement” for an explanation on our methodology in computing LTA and why we do not consider LTA for our pumped
storage and certain of our other facilities.
Includes two wind facilities (39 GWh) and five solar facilities (56 GWh) in Colombia.
(2)
Statement Regarding Forward-Looking Statements and Use of Non-IFRS Measures
This Annual Report contains forward-looking information within the meaning of U.S. and Canadian securities laws. We may make such
statements in this Annual Report and in other filings with the U.S. Securities and Exchange Commission (“SEC”) and with securities regulators
in Canada – see “PART 10 – Cautionary Statements”. We make use of non-IFRS measures in this Annual Report – see “Part 10 – Cautionary
Statements”. This Annual Report, our Form 20-F and additional information filed with the SEC and with Securities regulators in Canada are
available on our website at https://bep.brookfield.com, on the SEC's website at www.sec.gov or on SEDAR+'s website at www.sedarplus.ca.
Letter to Unitholders
2023 was another successful year for our business. Our disciplined approach to development and
underwriting enabled us to continue generating strong returns and advance our business plans. This is
evident in our results where we generated record funds from operations (FFO) and had a record year for
both capital deployed and asset development. We maintained our best-in-class balance sheet and have
significant flexibility moving forward to continue generating our target returns for shareholders.
We have established ourselves as a global clean energy supermajor, growing our capacity, capabilities
and relationships. We now have almost 33,000 megawatts of renewable power operating capacity and an
approximately 155,000-megawatt development pipeline. We grew our sustainable solutions business,
which contributed approximately 5% to our FFO this year and have a visible pipeline to grow this segment
which complements our renewable power business.
Our global scale and ability to provide large scale decarbonization solutions continues to positively impact
our performance and differentiates our value proposition to our customers. We have evolved from a pure
play renewable energy producer to a preeminent platform for renewable power and decarbonization
solutions, with a wider set of growth opportunities and greater upside. However, we continue to, and
always will, measure ourselves based on the value we generate for shareholders.
Given our strong financial performance and liquidity, and the positive outlook for the business, we are
pleased to announce an over 5% increase to our distributions to $1.42 per unit on an annualized basis.
This is the 13th consecutive year of at least 5% annual distribution growth, dating back to 2011, when
Brookfield Renewable was publicly listed.
Highlights for the year include:
• Generated record FFO for the year of $1.1 billion, or $1.67 per unit, a 7% increase over last year,
including solid fourth quarter results (per unit FFO increased 9%), as we benefitted from our
diverse asset base, high-quality inflation-linked and contracted cash flows, organic growth, and
contributions from acquisitions.
• We advanced commercial priorities including securing contracts for new developments for almost
50 terawatt hours of generation, of which over 90% is with corporate customers.
•
Accelerated our development activities, commissioning almost 5,000 megawatts of new clean
energy capacity globally across wind, solar and battery storage, further diversifying and growing
our cash flows. We expect commissioned capacity to contribute ~$60 million of incremental FFO
annually on a run-rate basis.
• Our advanced stage development pipeline expanded to almost 24,000 megawatts which is
expected to contribute approximately $300 million of FFO annually to Brookfield Renewable once
commissioned.
•
Deployed, or agreed to deploy a record $9 billion of capital ($2 billion net to Brookfield
Renewable) into accretive investments across all of our key markets and closed a number of
significant transactions in the fourth quarter including Westinghouse and Deriva Energy,
immediately growing our cash flows.
• We continued to execute on our capital recycling initiatives generating $800 million of proceeds
($500 million net to Brookfield Renewable) representing nearly three times our invested capital,
and providing funds for growth.
•
Strengthened our best-in-class balance sheet executing approximately $15 billion of financings
and finishing the year with available liquidity of over $4 billion, positioning the business to
opportunistically deploy capital at strong risk adjusted returns.
We are a key enabler of the technology sector
With the significant growth in demand for data globally, the position of the technology mega-cap players
as the largest and fastest growing businesses in the world continues to solidify. Since 2020, the cloud
computing segments of these companies have grown by over 30% annually, representing their highest
growth segments and generating their highest margins. Demand for cloud computing from digitalization
and the adoption of AI enabled tools is incentivizing these companies to continue investing heavily in their
capabilities and capacity, and two of the key ingredients needed to deliver these products are computing
power and energy.
Over the last twelve months, the race to increase computing power has been illustrated by the increase in
demand for certain inputs, such as computer chips. However, we believe most investors have yet to grasp
the importance of a secure energy source in being able to deliver data center and computing power
growth.
The largest cloud computing businesses run on clean power. These companies have 100% clean energy
targets and have been growing their consumption by approximately 50% per annum over the past couple
years, making them the largest buyers of green power globally. However, the highly power intensive
nature of AI is acting as a multiplier on energy demand which is increasingly becoming a key bottleneck
for growth of cloud computing. For example, the integration of AI uses up to ten times more power when
integrated into a typical search process. The accelerating global trend of digitalization was already driving
a step change in electricity needs, which is now being further multiplied by the implementation of AI.
Renewable power, as the cheapest form of bulk electricity production, is the solution to this growing
electricity demand.
Furthermore, as the scale and energy intensity of data centers increases, these facilities put pressure on
global electricity grids. As a result, certain regulators are now requiring data center developers to provide
a power solution in order to receive data center permitting approvals. This has put power on the critical
path to growth for these technology companies. Along with electrification of large segments like industrials
and transportation, this trend creates an environment where significant increases in demand for new
electricity projects is a reality in developed markets for the first time in decades.
It is widely estimated that global electricity consumption from data centers will increase to approximately
10% of total electricity demand by 2030 (from approximately 2% today). Meaning to satisfy the needs of
data centers alone – which doesn’t factor in the penetration of EV or broader electrification – additional
generation capacity will be required equivalent to the size of the current U.S. grid.
For the better part of a decade, we have been positioning our business to capitalize on these trends. By
building a leading global development platform, combined with our early focus on corporate power
marketing capabilities, this has allowed us to serve the needs of the largest and fastest growing buyers of
green power. The global technology companies have been the largest corporate customers of our
business for years, as we have differentiated ourselves with our scale and credibility, delivering new
energy projects on time to enable their growth.
Our ability to deliver 24/7 clean power solutions at scale and across geographies positions our business
to continue to be a major beneficiary of this robust demand growth going forward. Further, our ability to
provide unique and tailored solutions of scale allows us to avoid competition and drive better returns in
bilateral contracts. We have signed contracts to provide over 60 terawatt hours of power over the past two
years to the large technology businesses, an amount we expect to increase dramatically in the coming
years.
As a result, going forward we expect the vast majority of our new renewable power development will be
contracted to corporate customers where we are seeing strong demand for our differentiated offerings at
attractive contract terms. Currently we have approximately 22 terawatt hours per year of generation
contracted to corporate customers representing approximately 30% of our total contract volumes, over
double the volumes contracted to these types of customers five years ago. Based on our existing
development pipeline we expect contracted generation to corporate customers to double again by 2028 to
approximately 44 terawatt hours per year, or 45% of contract volumes.
We continue to deliver attractive risk adjusted returns
We were well equipped to navigate the rising rate environment and supply chain challenges that faced the
sector over the past twelve-months. Most notably, our disciplined approach to development, which
focuses on removing risks upfront, meant that our development activities remained robust, delivering a
record year, at a time when some market participants saw headwinds. Lastly, our prudent approach to
financing our business, combined with the strength of our balance sheet, durability of our cash flows, and
diverse sources of scale capital, ensured that we were able to continue to pursue growth at a time when
some could not and there was less competition.
We capitalized on opportunities, deploying or agreeing to deploy $9 billion of capital ($2 billion net to
Brookfield Renewable) highlighted by our acquisitions of Westinghouse, Deriva Energy, a further 50%
interest in X-Elio which we did not own, Banks Renewables, and investments in CleanMax and Avaada in
India.
While our proposed acquisition of Origin Energy did not receive the required level of shareholder support,
which was a condition precedent to the closing of the transaction, we are confident in achieving our target
deployment of $7-8 billion over the next five years and growing our cash flows and distributions in-line
with our targets. Since the initial announcement of the Origin transaction, we have received in-bounds
from businesses around the world who are seeking a partner with significant capital and deep operating
expertise to accelerate their transition goals and enhance the value of their businesses.
In light of public market conditions and our strong conviction in the intrinsic value of our business and
growth trajectory, we continued to allocate capital to repurchase shares. In 2023, we repurchased 2
million units under our normal course issuer bid. Looking forward, we will continue to allocate capital
based on where we are seeing the best risk-adjusted returns and remain confident we will continue to
create meaningful value for our investors.
We have been scaling our development capabilities and delivered almost 5,000 megawatts in the past
year, a record for our business, while also pulling forward our pipeline. Our advanced stage development
pipeline now stands at almost 24,000 megawatts with just under 7,000 megawatts on track to be
delivered this year and over 7,000 megawatts in 2025. These projects are well advanced with almost 25%
of our three year pipeline under construction, over 20% with revenues and inputs fully contracted and
over 30% in the final stages of securing PPAs and construction contracts. These projects and our
remaining advanced stage pipeline are expected to contribute $300 million of incremental run-rate FFO
once commissioned.
Operating Results
Our operating business continued to perform well and we delivered record FFO despite cyclical resource
volatility and generation below the long term average at some of our assets. We generated FFO of $1.1
billion, or $1.67 per unit, a 7% per unit increase year-over-year and a 9% increase per unit in the fourth
quarter. While our results fell slightly below our target of 10%+ FFO per unit growth, largely due to later
than expected transaction closings during the fourth quarter, we remain well positioned to achieve our
goal going into 2024 and beyond.
We are already seeing the benefits of our growth activities which were back-end weighted this year with
commissioning of nearly half of our almost 5,000 megawatts of new capacity in the fourth quarter and the
closing of major acquisitions contributing over $100 million in incremental annual FFO in the final three
months of the year. We expect to also receive an uplift as our fleet reverts to its long-term average
generation, particularly from our hydro assets where we often see cyclicality.
Additionally, we expect that our growth initiatives will continue to stabilize our results going forward, not
only increasingly diversifying our cash flows, but also enhancing the contracted and less variable
components of our business. As we continue to diversify our business, we are reducing the volatility of our
results and helping to minimize our exposure to any underlying resource to deliver our earnings growth
targets. While we constantly update and monitor our long-term average resource figures for financings
and management of our operations, the impact of these metrics on our financial performance is being
watered down (pardon the pun), by our broader development, growth, and contracting initiatives.
Our hydroelectric segment delivered FFO of $624 million. Despite a more challenging year from a
resource perspective in our high value markets, the portfolio performed well, benefiting from strong all-in
power prices. Reservoirs have rebounded to start 2024, with the first quarter trending positively compared
with the end of 2023.
Our wind and solar segments generated a combined $643 million of FFO benefiting from the
commissioning of new projects, repowering activities and our inflation linked contracted generation. As is
expected during a period of rapid growth, we have acquired a number of assets that were performing
below their long-term average generation under prior ownership. As part of our business plans, we
leverage our operational capabilities, through repowering and other upgrades, to drive improvement in
these assets back to their long-term average levels in the first few years post-ownership. We have been
executing several repowering and upgrade initiatives in the past couple years that are expected to be
completed and start contributing higher earnings this year.
Our distributed energy and storage, and sustainable solutions segments generated a combined $185
million of FFO, benefiting from organic growth as we scale these businesses. We continue to see positive
momentum for the more nascent technologies that sit in our sustainable solutions segment. For example,
our Canadian carbon capture and storage business Entropy entered into a fixed price 15-year carbon
credit offtake agreement with the Canada Growth Fund that guarantees an offtake price for 600 Kt per
annum of CO2, de-risking the project pipeline. Alongside the offtake agreement, Canada Growth Fund
agreed to invest up to C$200 million in the business which could result in a fully drawn post-money
valuation of approximately one and a half times our entry point.
Balance Sheet and Liquidity
We finished the year in an excellent financial position with over $4 billion of available liquidity providing
significant flexibility to fund our growth. Our best-in-class balance sheet and access to diverse sources of
capital continue to differentiate our business and enable us to opportunistically invest when capital
becomes scarce, as we demonstrated this year, adding quality businesses at attractive risk-adjusted
returns.
During the year we strengthened our financial position executing on almost $15 billion in non-recourse
financings generating almost $500 million in upfinancing proceeds to Brookfield Renewable. We also
recently updated our Green Financing Framework to incorporate eligible investment categories in-line
with our strategy to invest in businesses and projects that support the transition to net zero. We
subsequently took advantage of a favorable market environment in early January, issuing C$400 million
of 30-year notes at 5.3%, conservatively raising debt as our cash flows grow, maintaining our investment
grade rating and meaningfully extending our debt maturity profile.
We were successful with our capital recycling program generating $800 million in proceeds ($500 million
net to Brookfield Renewable) over the past twelve-months, representing almost three times our invested
capital. Our recycling initiatives are a consistent source of funding which we will continue to scale with our
growth in development activities. We take a disciplined and practical approach to asset rotation, looking to
sell assets when they are in-demand and attracting valuations at or above our internal assessments,
regardless of technology or geography.
We sold a 150-megawatt solar project in Spain which we commissioned in early 2023 generating $100
million in proceeds (~$20 million net to Brookfield Renewable). We also executed the sale of a minority
interest in a portfolio of contracted wind assets in Canada which we developed over ten years ago
returning over three and half times our invested capital over this period.
Our approach to selling assets that are in demand irrespective of technology or geography has served us
well and generated meaningful returns above our underwriting targets for investors. We expect to
continue to leverage this funding source going forward as we bring online new projects and acquire new
platforms.
Outlook
The prospects for our business continue to be very positive. Our goal remains to deliver 12-15% long-
term total returns for investors and to do this we will continue to be disciplined allocators of capital
leveraging our differentiated operating and development capabilities and diverse funding sources.
On behalf of the Board and management, we thank all our unitholders and shareholders for their ongoing
support. We look forward to updating you on our progress throughout 2024.
Sincerely,
Connor Teskey
Chief Executive Officer
February 29, 2024
OUR COMPETITIVE STRENGTHS
Brookfield Renewable Partners L.P. (together with its controlled entities, “Brookfield Renewable”) is a globally
diversified, multi-technology, owner and operator of clean energy and sustainable solutions assets.
Our business model is to utilize our global reach and experience to acquire and develop high quality clean energy
and sustainable solutions assets below intrinsic value, finance them on a long-term, low-risk and investment grade
basis through a conservative financing strategy and then optimize cash flows by applying our operating expertise to
enhance value or bring these assets into production generating incremental cash flows for our business.
One of the largest, public decarbonization businesses globally. Brookfield Renewable has a 23-year track record as
a publicly traded operator and investor in renewable power and sustainable solution assets. Today we have a large,
multi-technology and globally diversified portfolio that is supported by approximately 4,770 experienced employees
(inclusive of employees employed by our consolidated portfolio companies). Brookfield Renewable invests in assets
directly, as well as with institutional partners, joint venture partners and through other arrangements. We have also
made investments in our sustainable solutions portfolio comprised of assets and businesses that enable the transition
to net-zero where we can leverage our access to capital and partnerships to accelerate growth, and emerging
transition asset classes where our initial investment positions us for potential future large scale decarbonization
investment. Our sustainable solutions portfolio also includes investments in power transformation opportunities
where we have invested in businesses to enable the reduction of greenhouse gas emissions through the deployment
of traditional renewables.
Our globally diverse portfolio helps to mitigate resource variability, and improves consistency of our cash flows.
Our organic growth and acquisitions are typically done through Brookfield's private funds and therefore on a
proportionate basis Brookfield Renewable's business will continue to diversify but remain heavily weighted to our
premium hydroelectric assets.
Our renewable power portfolio consists of hydroelectric, wind, utility-scale solar, DG and storage facilities in North
America, South America, Europe and Asia, and totals approximately 31,800 megawatts of installed capacity and a
development pipeline of approximately 155,400 megawatts. Our portfolio of sustainable solutions assets includes
our investments in Westinghouse (a leading global nuclear services business), as well as investments in an operating
portfolio of 57 thousand metric tonnes per annum of CCS capacity, 3 million MMBtu of annual agricultural RNG
production capacity and over 1 million tons of recycled materials annually. Our sustainable solutions development
pipeline consists of 14 MMTPA of CCS capacity, 3.5 million MMBtu of annual renewable natural gas production,
1.6 million tons of recycled materials annual capacity, 1 million tons of annual Green Ammonia production capacity
and 5,000 MW of annual solar panel manufacturing capacity.
The following charts illustrate revenue on a proportionate basis(1):
(1) Figures based on normalized revenue for the last twelve months, proportionate to Brookfield Renewable.
Helping to accelerate the decarbonization and stability of the electricity grids. Climate change and energy security
are viewed as two of the most significant and urgent issues facing the global economy, posing immense risks to the
safety and security of communities and to our collective and economic prosperity. In response, governments and
businesses have adopted ambitious plans to support a transition to a decarbonized economy. We believe that our
scale and global operating, development and investing capabilities make us well positioned to partner with
governments and businesses to help them achieve their decarbonization goals.
Strong financial profile and conservative financing strategy. Brookfield Renewable maintains a robust balance
sheet, strong investment grade rating, and access to global capital markets to ensure cash flow resiliency through the
cycle. Our approach to financing is to raise the majority of our debt in the form of asset-specific, non-recourse
borrowings at our subsidiaries on an investment grade basis with no financial maintenance covenants.
Approximately 90% of our debt is either investment grade rated or sized to investment grade metrics. Our corporate
debt to total capitalization is approximately 12% and approximately 91% of our borrowings are non-recourse.
Corporate borrowings and proportionate non-recourse borrowings each have weighted-average terms of
approximately 10 years and 12 years, respectively, with no material maturities over the next five years.
Approximately 90% of our financings are effectively fixed rate and only 8% of our debt outside North America and
Europe is exposed to changes in interest rates. Our available liquidity as at December 31, 2023 is over $4.1 billion of
cash and cash equivalents, investments in marketable securities and the available portion of credit facilities.
Best-in class operators and developers. Brookfield Renewable has approximately 4,770 experienced operators
(inclusive of employees employed by our consolidated portfolio companies) and approximately 120 power
marketing experts that are located across the globe to help optimize the performance and maximize the returns of all
our assets. Our experience operating, developing, and managing power generation facilities span over 120 years. We
continue to accelerate our development activities as we build out our approximately 155,400 MW renewable power
pipeline, and further enhance our decarbonization offering to our customers through the build out of our sustainable
solutions assets, which includes opportunities to invest in additional projects with 14 MMTPA of CCS, 1.6 million
tonnes of recycled materials, roughly 3.5 million MMBtu of annual RNG production capacity, a solar manufacturing
facility capable of producing 5,000 MW of panels annually and a 1 million tons per annum green ammonia facility
powered entirely by renewable energy. Increasingly, the combination of our operating and developing capabilities
Technology55%19%13%8%5%HydroelectricWindSolar – utilityDistributed energy &StorageSustainable solutionsRegion63%22%13%2%North AmericaEuropeSouth AmericaAsia combined with our growth pipeline is differentiating our business as the partner of choice for buyers of clean power
and entities looking to decarbonize, driving the growth of our business.
Well positioned for cash flow growth and an attractive long term distribution profile. We are focused on delivering
resilient, stable distributions with meaningful growth of 5% to 9% annually through all market cycles from existing
operations and new investments. We are fully funded by internally generated cash flows, with inflation escalations
in the vast majority of our contracts, potential margin expansion through revenue growth and cost reduction
initiatives, and the building out our development pipeline at premium returns. We also supplement this organic
growth through acquisitions, leveraging Brookfield’s team of over 100 investment professionals globally who are
dedicated to sourcing and underwriting accretive acquisitions on an opportunistic basis.
Disciplined and contrarian investment strategy. Our global scale and multi-technology capabilities allow us to
rotate capital where it is scarce in order to earn strong risk-adjusted returns. We take a disciplined approach to
allocating capital into development and acquisitions with a focus on downside protection and preservation of capital.
Our ability to develop and acquire assets is strengthened by our operating and project development teams across the
globe, strategic relationship with Brookfield, and our liquidity and capitalization profile.
Conservative approach to asset development and asset management. We employ a conservative approach with
respect to asset development and management whereby we look to remove what we call “basis risk” before
committing significant capital. To do this, we look to secure financing, customer agreements and engineering,
procurement and construction contracts concurrently so we have strong visibility on cash flows and can lock-in our
target returns. Where possible, we look to secure fixed rate financing, inflation indexed customer agreements and
full wrap construction contracts to minimize uncertainty.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) MANAGEMENT
Our Approach to Sustainability
Our approach to sustainability is a key part of how we conduct our business as an investor, owner and operator
of one of the world’s largest publicly traded platforms for renewable power, sustainable solutions and
decarbonization solutions. We believe that strong sustainability principles, practices and performance support
creating a resilient business and generating long-term value for our stakeholders.
We embed sustainability throughout our investment process, starting with due diligence and through to our exit
from the investment. We tailor sustainability due diligence, leveraging our investment and operating expertise and
using guidance from the Sustainability Accounting Standards Board. We seek to proactively identify material
sustainability risks and opportunities most relevant to the investment and tailor our due diligence work accordingly.
After acquiring or investing in an asset, we implement a tailored integration plan that includes material
sustainability-related priorities. The management teams within each regional business are accountable for integrating
new investments and managing sustainability risks and opportunities through the investment’s life cycle.
Sustainability integration and performance are reviewed centrally on a regular basis through our formal governance
processes. Finally, as part of our divestiture process, we outline potential value creation from several different
factors, including sustainability considerations.
Environment
Decarbonization is a global goal shared by many governments, corporations and investors. As a leading owner
and developer of clean energy, we built our position in this sector over many decades and will leverage our
operational expertise to support the multi-decade transition required for global decarbonization. Our clean energy
assets already support others globally to reduce their emissions and we will continue to partner to drive emissions
reduction.
We recognize the importance of reducing the emissions from our own business. We have set an ambition to
deliver net-zero emissions across our business by 2050 or sooner and to accelerate the global transition. The
ambition is aligned with our strategy and underpinned by three goals:
•
Achieve net zero for Scope 1 & Scope 2 market-based emissions by 2030 across our existing renewable
operations. This target is supported by established plans with a primary focus on emissions reductions, including
increasing the use of renewable energy to power our assets and offices. In addition, we are working to enhance the
reporting of Scope 3 emissions across our wider value chain and aim to set a Scope 3 target in the future.
•
From 2022, develop an additional 21,000 MW of new clean energy capacity by 2030, which would
represent a doubling of our operating portfolio to 42,000 MW. In 2023, we developed approximately 5,000 MW of
new clean energy capacity, and we have developed approximately 8,000 MW since setting our target. We expect to
accomplish the remaining capacity growth by executing on opportunities in our existing development pipeline as
well as continuing to pursue acquisitions. See Item 3.D “Risk Factors — Risks Relating to Our Growth Strategy” in
our most recently Annual Report on Form 20-F.
•
Set emissions reduction targets and plans to align with the Paris Agreement for 100% of carbon intensive
investments. We seek opportunities to help businesses – primarily those in the energy, utility and industrial sectors
– to align with the goals of the Paris Agreement by setting interim and long-term targets against Paris-aligned
pathways and integrating these targets into the strategy, business plan and governance processes of new acquisitions.
We integrate wider environmental considerations, including biodiversity protection and water and waste
management, into our decision-making and activities, while striving for continuous improvement in our
environmental management system and overall performance. Our engagement and collaboration with stakeholders,
including communities, Indigenous peoples, local agencies and environmental NGOs, enhance our understanding of
ecosystems, the potential environmental impacts of our facilities and development of associated management plans.
We also support the market for green financing products, helping to accelerate the transformation and
decarbonization of global electricity generation, while reducing the cost of our borrowing. Our Green Financing
Committee, comprised of representatives from our Capital Markets and Treasury teams, manages our sustainable
financing strategy in collaboration with Brookfield Renewable’s Sustainability Team. The chief financial officer of
BRP Energy Group L.P., inclusive of any other affiliate of such entity that provides services to Brookfield
Renewable pursuant to our Master Services Agreement or any other service agreement or arrangement (together, the
“Service Provider”) oversees our strategy and includes these matters in reports to the board of directors of the
Brookfield Renewable Partners Limited, which serves as BEP’s general partner (“Managing General Partner”).
In 2023, we issued approximately $5 billion of green financings at both the corporate and project levels. This
brought our aggregate green issuances to approximately $15 billion, as of December 31, 2023. Additionally, in
January 2024, we issued an additional C$400 million in green financings at the corporate level. We updated our
Green Financing Framework which received a medium green overall rating by second-party opinion provider S&P,
with all of our eligible investment categories receiving medium or dark green classifications under S&P’s Shade of
Green methodology. All of our project-level green bonds received over 90 out of 100 Green Evaluation scores from
S&P Global Ratings Canada, a business unit of S&P Global Canada Corp (“S&P”), the highest on its scale. S&P
cited that Brookfield Renewable’s environmental stewardship, commitment to renewable power and use of proceeds
towards renewable power generation contributed to this top score.
Social
We seek to make a positive difference for our people and the communities in which we operate. Within our
operations, we maintain a strong focus on health and safety, support the development of our employees and strive to
create an open and inclusive work environment for our teams to thrive. We continuously strive to achieve excellence
in health and safety performance and to be industry leaders in risk management and incident prevention. Our health
and safety management philosophy emphasizes the importance of leadership, line management accountability, a
managed system approach and the identification and elimination of high-risk hazards as the cornerstones of
exceptional performance.
Across our value chain, we strive to build strong relationships with our community partners. We proactively
engage with communities and strive to create shared value. We believe having transparent and well-established
relationships with local stakeholders is key to successfully developing and operating our facilities. When
considering investing in or building a new facility, we conduct assessments and due diligence to identify local
stakeholders. Stakeholders can include communities, landowners, business owners, municipalities, recreational
organizations, NGOs or others potentially affected by or interested in our operations. We consult and work
proactively with local stakeholders to ensure that their interests and safety are appropriately integrated into our
decision-making, developments and operations.
We are dedicated to treating stakeholders, including employees, customers, suppliers, and the communities in
which we operate with dignity and respect. Our human rights policy and program includes adhering to all laws and
regulations that apply to our operations regarding fair labor and employment conditions and making efforts within
our business to enhance our due diligence, key contract terms, policies, procedures and collaboration with respect to
our human rights and the supply chain. Our commitment to human rights is integrated throughout our decision-
making and operations.
Governance
We maintain high ethical standards across our organization, key elements of which include our Code of
Business Conduct and Ethics, Anti-Bribery and Anti-Corruption Policy, a whistleblower hotline, and supporting
controls and procedures. To ensure best practices are adopted by our contractors, we have established a Vendor
Code of Conduct to better ensure that our contractors’ values, priorities and business practices are aligned with our
own. The standards set by these policies are designed to meet or exceed applicable law and regulation. We recognize
the importance of transparently reporting our sustainability programs and our ESG progress to stakeholders
including our investors. As such, we began publishing an annual sustainability report in 2020 detailing how we
embed environmental, social and governance principles into our business and also continue to report in alignment
with the recommendations of the Taskforce on Climate-related Financial Disclosures.
Oversight of our sustainability matters resides with our Board of Directors and senior leadership team:
•
Board of Directors: The board of directors of the Managing General Partner and its committees oversee our
sustainability strategy, which is focused on decarbonization, and review our sustainability approach and
performance throughout the year. It also reviews global policies related to sustainability and monitors the
performance of our regional businesses. The board of directors of the Managing General Partner receives
quarterly updates on sustainability performance.
Executive Management Team: The Chief Executive Officer of the Service Provider has ultimate
accountability for implementing strategy for the business, including the delivery of sustainability programs
and goals. The Chief Executive Officer of the Service Provider and the executive management team set and
provide oversight for delivery of the strategic vision and priorities of our business.
Regional Business Leads: The Chief Executive Officers of our regional businesses implements local
objectives within their business and are accountable for sustainability performance.
Sustainability Steering Committee: Our Sustainability Steering Committee sets sustainability goals, shares
best practices, monitors progress and performance against our goals and seeks opportunities for
improvement. The committee includes the Chief Executive Officers of our regional operating businesses,
our Chief Sustainability Officer, and our Chief Risk Officer along with various sustainability and
operations experts from across our businesses.
HSS&E Steering Committee: Our HSS&E Steering Committee manages our strategic health and safety
framework. The committee sets our comprehensive health and safety policies, upholds our robust health
and safety culture and management system, shares best practices, seeks opportunities to continuously
improve our safety performance and monitors performance against our goal to achieve zero high-risk
incidents.
Investment Review: The Service Provider incorporates sustainability factors, including climate-related
considerations, into the due diligence process for potential investments, including reviewing material
sustainability and other findings from due diligence, prior to investment decisions being made.
•
•
•
•
•
A proactive and focused approach continuing to build upon our high sustainability standards creates value in
our business. The initiatives we undertake and the investments we make in building our business are guided by our
core set of values around sustainability, as we create a culture and organization that we believe can be successful
today and in the future. For a discussion of the individuals from Brookfield’s management team that are expected to
be involved in our business, please see “Risk Factors” included in our most recent Annual Report on Form 20-F.
Management’s Discussion and Analysis
For the year ended December 31, 2023
This Management’s Discussion and Analysis for the year ended December 31, 2023 is provided as of February 29, 2024. Unless the context
indicates or requires otherwise, the terms “Brookfield Renewable”, “we”, “us”, and “our company” mean Brookfield Renewable Partners L.P.
and its controlled entities. The ultimate parent of Brookfield Renewable is Brookfield Corporation (“Brookfield Corporation”). Brookfield
Corporation and its subsidiaries, other than Brookfield Renewable, and unless the context otherwise requires, includes Brookfield Asset
Management Ltd (“Brookfield Asset Management”), are also individually and collectively referred to as “Brookfield” in this Management’s
Discussion and Analysis. The term “Brookfield Holders” means Brookfield, Brookfield Reinsurance and their related parties.
Brookfield Renewable’s consolidated equity interests include the non-voting publicly traded limited partnership units (“LP units”) held by public
unitholders and Brookfield, class A exchangeable units (“Redeemable/Exchangeable partnership units”) in Brookfield Renewable Energy L.P.
(“BRELP”), a holding subsidiary of Brookfield Renewable, held by Brookfield, and general partnership interest (“GP interest”) in BRELP held
by Brookfield. Holders of the LP units, Redeemable/Exchangeable partnership units, GP interest, and exchangeable shares will be collectively
referred to throughout as “Unitholders” unless the context indicates or requires otherwise. LP units, Redeemable/Exchangeable partnership units,
GP interest, and BEPC exchangeable shares will be collectively referred to throughout as "Units", or as "per Unit", unless the context indicates or
requires otherwise. The LP units, exchangeable shares and Redeemable/Exchangeable partnership units have the same economic attributes in all
respects. See – “Part 9 – Presentation to Stakeholders and Performance Measurement”.
Brookfield Renewable’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by
the International Accounting Standards Board (“IASB”), which require estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent liabilities as at the date of the financial statements and the amounts of revenue and expense during the
reporting periods.
Certain comparative figures have been reclassified to conform to the current year’s presentation.
References to $, C$, €, R$, £, and COP are to United States (“U.S.”) dollars, Canadian dollars, Euros, Brazilian reais, British pounds sterling and
Colombian pesos, respectively. Unless otherwise indicated, all dollar amounts are expressed in U.S. dollars.
For a description on our operational and segmented information and for the non-IFRS financial measures we use to explain our financial results
see “Part 9 – Presentation to Stakeholders and Performance Measurement”. For a reconciliation of the non-IFRS financial measures to the most
comparable IFRS financial measures, see “Part 4 – Financial Performance Review on Proportionate Information – Reconciliation of non-IFRS
measures”. This Management’s Discussion and Analysis contains forward-looking information within the meaning of U.S. and Canadian
securities laws. Refer to – “Part 10 – Cautionary Statements” for cautionary statements regarding forward-looking statements and the use of non-
IFRS measures. Our Annual Report and additional information filed with the Securities Exchange Commission (“SEC”) and with securities
regulators in Canada are available on our website (https://bep.brookfield.com), on the SEC’s website (www.sec.gov), or on SEDAR+
(www.sedarplus.ca).
Organization of the Management’s Discussion and Analysis
PART 1 – 2023 Highlights
PART 2 – Financial Performance Review on
Consolidated Information
PART 3 – Additional Consolidated Financial
Information
Summary consolidated statements of financial
position
Related party transactions
Equity
PART 4 – Financial Performance Review on
Proportionate Information
Proportionate results for the years ended December
31, 2023 and 2022
Proportionate results for the years ended December
31, 2022 and 2021
Reconciliation of non-IFRS measures
Contract profile
PART 5 – Liquidity and Capital Resources
Capitalization
Available liquidity
Borrowings
1
4
6
6
7
10
12
12
17
21
25
26
26
27
28
PART 5 – Liquidity and Capital Resources
(continued)
Capital expenditures
Consolidated statements of cash flows
Shares, notes and units outstanding
Dividends and distributions
Contractual obligations
Supplemental guarantor financial information
Off-statement of financial position arrangements
PART 6 – Selected Annual and Quarterly
Information
Summary of historical quarterly results
Proportionate results for the fourth quarter
PART 7 – Business Risks and Risk Management
Risk management and financial instruments
PART 8 – Critical Estimates and Accounting
Policies
PART 9 – Presentation to Stakeholders and
Performance Measurement
26
29
30
32
32
33
33
34
35
36
37
41
41
54
58
PART 1 – 2023 HIGHLIGHTS
YEAR ENDED DECEMBER 31
(MILLIONS, EXCEPT AS NOTED)
Selected financial information
......................................................................................
Revenues .................................................................................................................................. $
Net loss attributable to Unitholders(1)
Basic and diluted net loss per LP unit(2)
Proportionate Adjusted EBITDA(3)
Funds From Operations(3)
Funds From Operations per Unit(3)(4)
Distribution per LP unit ...........................................................................................................
........................................................................................................
..........................................................................................
.......................................................................................
...................................................................................
2023
2022
5,038 $
(100)
(0.32)
2,182
1,095
1.67
1.35
4,711
(295)
(0.60)
2,002
1,005
1.56
1.28
Operational information
Capacity (MW) ........................................................................................................................
32,949
25,377
Total generation (GWh)
Long-term average generation ..............................................................................................
Actual generation ..................................................................................................................
75,584
69,704
63,656
63,036
Proportionate generation (GWh)
Actual generation ..................................................................................................................
29,467
28,669
(1)
(2)
(3)
(4)
Includes $91 million loss attributed to Limited Partner equity, $57 million loss attributed to BEPC exchangeable shares, $63 million loss
attributed to Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable units held by Brookfield, and
$111 million income General partnership interest in a holding subsidiary held by Brookfield.
Average LP units for the year ended December 31, 2023 were 282.4 million (2022: 275.2 million).
Non-IFRS measure. For reconciliations to the most directly comparable IFRS measure, see “Cautionary Statement Regarding Use of Non-
IFRS Measures” and “PART 4 – Financial Performance Review on Proportionate Information – Reconciliation of Non-IFRS Measures”.
Average Units outstanding for the year ended December 31, 2023 were 657.1 million (2022: 645.9 million), being inclusive of our LP units,
Redeemable/Exchangeable partnership units, BEPC exchangeable shares and GP interest.
AS AT DECEMBER 31
(MILLIONS, EXCEPT AS NOTED)
Liquidity and Capital Resources
December 31, 2023
December 31, 2022
Available liquidity ..................................................................................................
$
Debt to capitalization – Corporate .........................................................................
Debt to capitalization – Consolidated ....................................................................
Non-recourse borrowings – Consolidated .............................................................
Fixed rate debt exposure on a proportionate basis(1)
Corporate borrowings
..............................................
Average debt term to maturity ............................................................................
Average interest rate ............................................................................................
Non-recourse borrowings on a proportionate basis
Average debt term to maturity ............................................................................
Average interest rate ............................................................................................
$
4,121
12 %
40 %
91 %
96 %
10 years
4.3 %
12 years
5.4 %
3,695
11 %
39 %
91 %
97 %
11 years
4.1 %
12 years
4.9 %
(1)
Total floating rate exposure is 12% (2022: 10%) of which 8% (2022: 7%) is related to floating rate debt exposure of certain foreign regions-
outside of North America and Europe due to the high cost of hedging associated with those regions.
Page 1
Operations
Funds From Operations of $1,095 million or $1.67 on a per Unit basis is higher than the prior year driven by:
•
•
•
Contributions from growth, both from acquisitions and 4,511 MW of new development projects reaching
commercial operation;
Strong asset availability across our fleet; and
Higher realized prices across most markets after adjusting for recent acquisitions on the back of inflation
escalation and commercial initiatives
After deducting non-cash depreciation, deferred income tax, foreign exchange and financial instruments gain
and other, net loss attributable to Unitholders was $100 million or $0.32 per LP unit, compared to net loss
attributable to Unitholders of $295 million or $0.60 per LP unit in the prior year.
Refer to Part 2 - Financial Performance Review on Consolidated Information in this Management’s Discussion
and Analysis for details on consolidated statements of income (loss).
We continue to be the partner of choice to procure clean power:
• We advanced commercial priorities including securing contracts for new developments for almost 50
terawatt hours of generation, of which over 90% is with corporate customers
Liquidity and Capital Resources
Our best-in-class balance sheet with investment grade BBB+ credit rating and access to diverse sources of
capital continue to differentiate our business and enable us to opportunistically invest when capital becomes scarce
•
•
•
•
•
Liquidity position remains robust, with $4.1 billion of total available liquidity, providing significant
flexibility to fund growth, and no meaningful near-term maturities
Closed approximately $15 billion in non-recourse financings generating almost $500 million in
upfinancings to Brookfield Renewable
During the year, issued C$400 million of 10-year medium-term notes and issued an additional C$400
million 30-year medium-term notes in January 2024, extending our average corporate term-to-maturity
from 10 to 12 years
On the back of significant outperformance of our growth targets, we completed a $650 million equity
financing through a bought deal of both 8.2 million LP units and 7.43 million BEPC exchangeable shares,
and a concurrent private placement of 5.15 million LP units
Continued to execute our asset recycling initiatives generating $800 million ($500 million net to Brookfield
Renewable) over the past 12-months generating nearly three times our invested capital and providing funds
for growth
Growth and Development
During the year, together with our institutional partners, we have deployed, or agreed to deploy a record of
approximately $9 billion of capital (approximately $2 billion net to Brookfield Renewable) into investments across
all our key markets, including:
•
•
•
Completed the acquisition of Westinghouse for $4.37 billion ($442 million net to Brookfield Renewable), a
leading global provider of highly technical and critical clean energy services to the nuclear industry in a
strategic partnership with Cameco
Completed the acquisition of a U.S. renewable portfolio, Deriva Energy for $1.08 billion (expected $308
million net to Brookfield Renewable), one of the largest renewable platforms in the U.S. with 5.9 GW of
operating and under construction wind, utility scale solar and storage assets, and a 6.1 GW development
pipeline. We expect to hold a 28% interest in the investment ($303 million net to Brookfield Renewable).
Completed the acquisition of the remaining 50% interest in X-Elio which we did not own for total
consideration of $893 million ($76 million net to Brookfield Renewable)
Page 2
•
•
•
Completed the acquisition of U.K. Wind Portfolio, Banks Renewables for $625 million ($296 million net to
Brookfield Renewable), a leading independent UK renewables developer with approximately 260 MW
operating onshore wind assets, 800 MW of near-term development and another 3 GW of later stage
projects. We expect to hold a 20% interest in the investment ($125 million net to Brookfield Renewable).
Invested in a leading renewable platform in India with operating and development assets, to provide a
structured U.S. dollar financing solution in the form of convertible securities with an initial investment of
$400 million ($80 million net to Brookfield Renewable) and the option to invest up to $600 million ($120
million net to Brookfield Renewable) in additional convertible securities to finance the company’s
renewable development pipeline, as well as investing in a solar panel manufacturing facility and a green
ammonia production facility; and
Agreed to invest up to $360 million ($72 million net to Brookfield Renewable) to acquire a 55% stake in a
leading commercial and industrial renewable platform based in India with 4,500 megawatts of operating
and development pipeline
We continued to accelerate our development activities
• We accelerated our development activities, commissioning almost 5,000 MW of new projects globally
across wind, solar and battery storage as well as 15 TMTPA of carbon capture and storage, and 402,265
MMBtu of agricultural renewable natural gas through our sustainable solutions portfolio further
diversifying and growing our cash flows. We expect commissioned capacity to contribute ~$65 million of
incremental FFO annually on a run-rate basis. Our near-term development pipeline expanded to
approximately 23,800 MW, which, along with our sustainable solutions pipeline, is expected to contribute
approximately $300 million of FFO annually on a run-rate basis to Brookfield Renewable once
commissioned
Page 3
PART 2 – FINANCIAL PERFORMANCE REVIEW ON
CONSOLIDATED INFORMATION
The following table reflects key financial data for the year ended December 31:
(MILLIONS, EXCEPT AS NOTED)
2023
2022
Revenues .................................................................................................................... $
5,038 $
4,711 $
Direct operating costs .................................................................................................
Management service costs ..........................................................................................
Interest expense ..........................................................................................................
Depreciation ...............................................................................................................
Income tax recovery (expense) ..................................................................................
Net income (loss) .......................................................................................................
(1,933)
(205)
(1,627)
(1,852)
48
(1,434)
(243)
(1,224)
(1,583)
2
616
Average FX rates to USD
138
C$ ...............................................................................................................................
€ ..................................................................................................................................
R$ ...............................................................................................................................
COP ............................................................................................................................
1.35
0.92
4.99
4,328
1.30
0.95
5.16
4,253
2021
4,096
(1,365)
(288)
(981)
(1,501)
(14)
(66)
1.25
0.85
5.40
3,742
Current Year Variance Analysis (2023 vs 2022)
Revenues totaling $5,038 million represents an increase of $327 million compared to prior year due to the
growth of our business and higher realized prices. Recently acquired and commissioned facilities contributed 6,706
GWh of generation and $311 million of revenues, which was partially offset by recently completed asset sales that
reduced generation by 1,134 GWh and revenues by $89 million. On a same store, constant currency basis, revenues
increased by $124 million as the benefits from higher realized prices across most markets on the back of inflation
escalation and commercial initiatives were partially offset by lower hydrology at our Canadian and Colombian
hydroelectric assets and lower average revenue per MWh at our European wind and solar assets as a result of
adjustments to the regulated price earned in Spain that decreased revenue in the short term but has no impact on the
value of the asset given the regulatory construct.
During the year there was an unfavorable foreign exchange impact of $19 million on revenue as well as a $17
million unfavorable foreign exchange impact on our operating and interest expenses.
Direct operating costs totaling $1,933 million represents an increase of $499 million compared to prior year due
to additional costs from our recently acquired and commissioned facilities and higher power purchases in Colombia,
which are passed through to our customers, partly offset by our recently completed asset sales and the above noted
strengthening of the U.S. dollar.
Management service costs totaling $205 million represents a decrease of $38 million compared to prior year.
Interest expense totaling $1,627 million represents an increase of $403 million compared to prior year due to
growth in our portfolio and upfinancings completed in the prior year at our North American and South American
hydroelectric assets to fund the growth of our business.
Depreciation expense totaling $1,852 million represents an increase of $269 million compared to prior year due
to the growth of our business.
Net income totaling $616 million represents an increase of $478 million compared to prior year due to the
above noted items, other income relating to non-recurring income and a gain on sale of non-core wind assets.
Page 4
Prior Year Variance Analysis (2022 vs 2021)
Revenues totaling $4,711 million represents an increase of $615 million over same period in the prior year due
to the growth of our business and higher power prices. Recently acquired and commissioned facilities contributed
3,544 GWh of generation and $288 million of revenues, which was partially offset by recently completed asset sales
that reduced generation by 996 GWh and revenues by $99 million. On a same store, local currency basis, revenues
increased by $569 million primarily due to higher average realized revenue per MWh due to inflation indexation,
recontracting initiatives, and higher global merchant power, as well as stronger hydrology across our fleet.
The strengthening of the U.S. dollar relative to the same period in the prior year across most of the currencies
decreased revenues by approximately $143 million, which was partially offset by a $90 million favorable foreign
exchange impact on our operating and interest expenses.
Direct operating costs totaling $1,434 million represents an increase of $69 million over the same period in the
prior year due to additional costs from our recently acquired and commissioned facilities being partly offset by cost
saving initiatives across our business, recently completed asset sales and the impact of foreign exchange movement
noted above.
Management service costs totaling $243 million represents a decrease of $45 million over the same period in the
prior year.
Interest expense totaling $1,224 million represents an increase of $243 million over the same period in the prior
year due to the growth in our portfolio and accelerated financing initiatives in Colombia, as well as a C$1.0 billion
strategic upfinancing of our Canadian hydroelectric facility to fund the growth of our business.
Depreciation expense totaling $1,583 million represents an increase of $82 million over the same period in the
prior year due to the growth of our business.
Net income totaling $138 million represents an increase of $204 million over the same period in the prior year.
Page 5
PART 3 – ADDITIONAL CONSOLIDATED FINANCIAL
INFORMATION
SUMMARY CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
The following table provides a summary of the key line items on the audited annual consolidated statements of
financial position as at December 31:
(MILLIONS)
2023
Assets held for sale ......................................................................................................................... $
— $
Current assets .................................................................................................................................
Equity-accounted investments ........................................................................................................
Property, plant and equipment, at fair value ..................................................................................
Total assets .....................................................................................................................................
Liabilities directly associated with assets held for sale ..................................................................
Corporate borrowings .....................................................................................................................
Non-recourse borrowings ...............................................................................................................
Deferred income tax liabilities .......................................................................................................
Total liabilities and equity ..............................................................................................................
4,610
2,546
64,005
76,128
—
2,833
26,869
7,174
76,128
FX rates to USD
C$ ...................................................................................................................................................
€ ......................................................................................................................................................
R$ ...................................................................................................................................................
COP ................................................................................................................................................
1.33
0.91
4.84
3,822
2022
938
4,183
1,392
54,283
64,111
351
2,548
22,302
6,507
64,111
1.35
0.93
5.22
4,810
Property, plant and equipment
Property, plant and equipment totaled $64.0 billion as at December 31, 2023 compared to $54.3 billion as at
December 31, 2022 representing an increase of $9.7 billion. Our acquisitions during the year, included a 136 MW
portfolio of operating wind assets in Brazil, a fully integrated developer and operator of renewable power assets in
the United States with 5,900 MW of operating and under construction assets, with a 6,100 MW development
pipeline, a 60 MW portfolio of operating wind assets in Brazil, and a leading commercial and industrial renewable
platform based in India with 4,500 MW of operating and development assets, as well as our continued investments
in the development of power generating assets which combined increased property, plant and equipment by
$9.1 billion. The weakening of the U.S. dollar versus the Colombian Peso and Brazilian Reais increased property,
plant and equipment by $2.7 billion. The increase was partly offset by, the sale of our 26 MW solar asset in Uruguay
and depreciation expense associated with property, plant and equipment of $1.8 billion.
Assets held for sale and Liabilities directly associated with assets held for sale
Assets held for sale and Liabilities directly associated with assets held for sale totaled nil and nil , respectively,
as at December 31, 2023 compared to $938 million and $351 million, respectively, as at December 31, 2022.
In the first quarter of 2023, Brookfield Renewable’s institutional partners completed the sale of a 78% interest
in a 378 MW operating hydroelectric portfolio in the U.S., of which 28% was sold to affiliates of Brookfield
Corporation. Brookfield Renewable retained its 22% interest in the investment and accordingly, did not receive any
proceeds from the sale. Subsequent to the completion of the sale, Brookfield Renewable no longer consolidates this
investment and recognized its interest as an equity-accounted investment.
In the second quarter of 2023, Brookfield Renewable, together with its institutional partners, completed the sale
of wind assets in the U.S. that were acquired in 2022.
Page 6
In the third quarter of 2023, Brookfield Renewable, together with its institutional partners, completed the sale of
its 100% interest in a 95 MW portfolio of wind assets and 100% interest in a 26 MW solar asset in Uruguay.
RELATED PARTY TRANSACTIONS
Brookfield Renewable’s related party transactions are in the normal course of business and are recorded at the
exchange amount. Brookfield Renewable’s related party transactions are primarily with Brookfield Corporation.
Brookfield Renewable sells electricity to Brookfield through a single long-term PPA across Brookfield
Renewable’s New York hydroelectric facilities.
In 2011, on formation of Brookfield Renewable, Brookfield transferred certain development projects to
Brookfield Renewable for no upfront consideration but is entitled to receive variable consideration on commercial
operation or sale of these projects.
Brookfield Renewable has entered into voting agreements with Brookfield, whereby Brookfield Renewable
gained control of the entities that own certain renewable power generating facilities. Brookfield Renewable has also
entered into a voting agreement with its consortium partners in respect of the Colombian business. The voting
agreements provide Brookfield Renewable the authority to direct the election of the Boards of Directors of the
relevant entities, among other things, and therefore provide Brookfield Renewable with control. Accordingly,
Brookfield Renewable consolidates the accounts of these entities.
Brookfield Renewable participates with institutional partners in Brookfield Americas Infrastructure Fund,
Brookfield Infrastructure Fund II, Brookfield Infrastructure Fund III, Brookfield Infrastructure Fund IV, Brookfield
Infrastructure Fund V, Brookfield Infrastructure Income Fund, Brookfield Global Transition Fund I, Brookfield
Global Transition Fund II, and Brookfield Infrastructure Debt Fund (“Private Funds”), each of which is a Brookfield
sponsored fund, and in connection therewith, Brookfield Renewable, together with our institutional partners, has
access to financing using the Private Funds’ credit facilities.
From time to time, in order to facilitate investment activities in a timely and efficient manner, Brookfield
Renewable will fund deposits or incur other costs and expenses (including by use of loan facilities to consummate,
support, guarantee or issue letters of credit) in respect of an investment that ultimately will be shared with or made
entirely by Brookfield sponsored vehicles, consortiums and/or partnerships (including private funds, joint ventures
and similar arrangements), Brookfield Renewable, or by co-investors.
On June 16, 2023, Brookfield Renewable completed the issuance of 8,200,000 LP Units and 7,430,000 class A
exchangeable subordinated voting shares of BEPC (“Exchangeable shares”) on a bought deal basis at a price of
$30.35 per LP Unit and $33.80 per Exchangeable Share for gross proceeds of $500 million. Concurrently, a
subsidiary of Brookfield Reinsurance purchased 5,148,270 LP units at the LP unit offering price (net of underwriting
commission). The aggregate gross proceeds of the offering and the concurrent private placement was approximately
$650 million. Brookfield Renewable incurred $20 million in related transaction costs inclusive of fees paid to
underwriters.
Brookfield Corporation has provided a $400 million committed unsecured revolving credit facility maturing in
December 2024 and the draws bear interest at the Secured Overnight Financing Rate plus a margin. During the
current period, there were no draws on the committed unsecured revolving credit facility provided by Brookfield
Corporation. Brookfield Corporation may from time to time place funds on deposit with Brookfield Renewable
which are repayable on demand including any interest accrued. There were nil funds placed on deposit with
Brookfield Renewable as at December 31, 2023 (2022: nil). The interest expense on the deposit and draws from the
credit facility for the year ended December 31, 2023 totaled nil (2022: nil and 2021: $2 million)
On November 7, 2023, Brookfield Renewable, together with institutional partners, through a strategic
partnership with Cameco Corporation, acquired 100% of Westinghouse, one of the world’s largest nuclear services
businesses, from our affiliate Brookfield Business Partners L.P. and its institutional partners, for $4.37 billion
(approximately $437 million invested by Brookfield Renewable).
In addition, our company has executed, amended, or terminated other agreements with Brookfield that are
described in Note 28 – Related party transactions in our audited annual consolidated financial statements. For a
Page 7
description of certain of our agreements with Brookfield, please see Item 7.B “Related Party Transactions” in our
Form 20-F for the annual period ended December 31, 2023.
The following table reflects the related party agreements and transactions in the audited annual consolidated
statements of income (loss), for the year ended December 31:
(MILLIONS)
Revenues
2023
2022
2021
Power purchase and revenue agreements ................................................................ $
14 $
21 $
103
Direct operating costs
Energy marketing fee and other services ................................................................
Insurance services(1)
................................................................................................
(5)
—
(1)
—
$
(5) $
(1) $
Interest expense
Borrowings .............................................................................................................. $
(35) $
— $
Contract balance accretion .......................................................................................
(26)
(20)
$
(61) $
(20) $
Other
Distribution income ................................................................................................. $
Other related party services ..................................................................................... $
Financial instrument gain/loss ................................................................................. $
8 $
3 $
21 $
— $
(5) $
5 $
(8)
(26)
(34)
(2)
(21)
(23)
—
(4)
—
Management service costs .......................................................................................... $
(1)
(205) $
(243) $
(288)
Prior to November 2021, insurance services were paid to external insurance service providers through subsidiaries of Brookfield
Corporation. The fees paid to the subsidiaries of Brookfield Corporation in 2023 were nil (2022 was nil and 2021: was nil). As of November
2021, Brookfield, through a regulated subsidiary, began providing insurance coverage through third-party commercial insurers for the
benefits of certain entities in North America. The premiums and claims paid are not included in the table above.
Page 8
balance
The following table reflects the impact of the related party agreements and transactions on the consolidated
31:
2022
as
Related party
December
sheets
2023
at
(MILLIONS)
Current assets
Trade receivables and other current assets
Brookfield ..................................................
$
61 $
54
Contract asset
Due from related parties
Amounts due from
Non-current assets
Financial instrument assets
Other long-term assets
Contract asset
Amounts due from
Current liabilities
Contract Liability
Brookfield(1)
...............................................
Equity-accounted investments and other ...
1,386
57
1,443
Brookfield ..................................................
170
Brookfield ..................................................
Equity-accounted investments and other ...
Brookfield ..................................................
Financial Instrument Liabilities
Brookfield Reinsurance .............................
Due to related parties
Amount due to
Brookfield(1)
...............................................
Equity-accounted investments and other ...
Brookfield Reinsurance .............................
Accrued distributions payable on LP units, BEPC
exchangeable shares and Redeemable/
Exchangeable partnership units and GP interest Brookfield ..................................................
Non-Current liabilities
Financial Instrument Liabilities
Due to related parties
Amount due to
Brookfield Reinsurance .............................
Brookfield ..................................................
Equity-accounted investments and other ...
Corporate borrowings
Brookfield Reinsurance .............................
Non-recourse borrowings
Brookfield Reinsurance and associates ......
Other long-term liabilities
Contract liability
Equity
Preferred limited partners equity
Brookfield ..................................................
680
662
Brookfield Reinsurance and associates ......
$
11
11
(1)
(2)
Includes receivables of $1,328 million (2022: $45 million) associated with the Brookfield Global Transition Fund credit facility
Includes payables of $6 million (2022: $39 million), $81 million (2022: $64 million), and $307 million (2022: nil) associated with the
Brookfield Infrastructure Fund IV, Brookfield Global Transition Fund, and Brookfield Global Transition Fund II credit facilities,
respectively
Page 9
105
18
123
395
341
128
24
3
205
24
321
38
588
3
—
1
1
7
93
314
135
35
2
541
13
242
39
835
2
496
209
705
8
101
EQUITY
General partnership interest in a holding subsidiary held by Brookfield
Brookfield, as the owner of the 1% GP interest in BRELP, is entitled to regular distributions plus an incentive
distribution based on the amount by which quarterly LP unit distributions exceed specified target levels. As at
December 31, 2023, to the extent that LP unit distributions exceed $0.20 per LP unit per quarter, the incentive
distribution is 15% of distributions above this threshold. To the extent that quarterly LP unit distributions exceed
$0.2253 per LP unit per quarter, the incentive distribution is equal to 25% of distributions above this threshold.
Incentive distributions of $111 million were declared during the year ended December 31, 2023 (2022: $94 million).
Preferred equity
The Class A Preference Shares of Brookfield Renewable Power Preferred Equity Inc. (“BRP Equity”) do not
have a fixed maturity date and are not redeemable at the option of the holders. As at December 31, 2023, none of the
issued Class A, Series 5 and 6 Preference Shares have been redeemed by BRP Equity.
In December 2023, the Toronto Stock Exchange accepted notice of BRP Equity's intention to renew the normal
course issuer bid in connection with its outstanding Class A Preference Shares for another year to December 17,
2024, or earlier should the repurchases be completed prior to such date. Under this normal course issuer bid, BRP
Equity is permitted to repurchase up to 10% of the total public float for each respective series of the Class A
Preference Shares. Shareholders may receive a copy of the notice, free of charge, by contacting Brookfield
Renewable. There were no repurchases of Class A Preference Shares during 2023 or 2022 in connection with the
normal course issuer bid.
Perpetual subordinated notes
The perpetual subordinated notes are classified as a separate class of non-controlling interest on Brookfield
Renewable's consolidated statements of financial position. Brookfield Renewable incurred interest of $29 million on
the perpetual subordinated notes during the year ended December 31, 2023 (2022: $29 million). Interest incurred on
the perpetual subordinated notes are presented as distributions in the consolidated statements of changes in equity.
Preferred limited partners’ equity
The Class A Preferred Limited Partnership Units (“Preferred units”) of Brookfield Renewable do not have a
fixed maturity date and are not redeemable at the option of the holders.
In the second quarter of 2023, Brookfield Renewable declared the fixed quarterly distributions on the Class A
Preferred Limited Partnership Series 13 Units during the five years commencing May 1, 2023 will be paid at an
annual rate of 6.05%.
In December 2023, the Toronto Stock Exchange accepted notice of Brookfield Renewable's intention to renew
the normal course issuer bid in connection with the outstanding Class A Preferred Limited Partnership Units for
another year to December 17, 2024, or earlier should the repurchases be completed prior to such date. Under this
normal course issuer bid, Brookfield Renewable is permitted to repurchase up to 10% of the total public float for
each respective series of its Class A Preferred Limited Partnership Units. Unitholders may receive a copy of the
notice, free of charge, by contacting Brookfield Renewable. No shares were repurchased during 2023 or 2022.
Limited partners’ equity, Redeemable/Exchangeable partnership units, and BEPC exchangeable shares
On June 16, 2023, Brookfield Renewable completed the issuance of 8,200,000 LP Units and 7,430,000 class A
exchangeable subordinated voting shares of BEPC (“Exchangeable shares”) on a bought deal basis at a price of
$30.35 per LP Unit and $33.80 per Exchangeable Share for gross proceeds of $500 million. Concurrently, a
subsidiary of Brookfield Reinsurance purchased 5,148,270 LP units at the LP unit offering price (net of underwriting
commission). The aggregate gross proceeds of the offering and the concurrent private placement was approximately
$650 million. Brookfield Renewable incurred $20 million in related transaction costs inclusive of fees paid to
underwriters.
Page 10
As at December 31, 2023, Brookfield Holders held a direct and indirect interest of approximately 47% of
Brookfield Renewable on a fully-exchangeable basis. Brookfield Holders own, directly and indirectly, 313,640,823
LP units, Redeemable/Exchangeable partnership units and BEPC exchangeable shares, on a combined basis and the
remaining is held by public investors.
During the year ended December 31, 2023, Brookfield Renewable issued 304,899 LP units (2022: 262,177 LP
units) under the distribution reinvestment plan at a total value of $8 million (2022: $9 million).
During the year ended December 31, 2023, exchangeable shareholders of BEPC exchanged 8,465 BEPC
exchangeable shares (2022: 12,308 BEPC exchangeable shares) for an equivalent number of LP units amounting to
less than $1 million (2022: less than $1 million).
In December 2023, Brookfield Renewable renewed its normal course issuer bid in connection with its LP units
and outstanding BEPC exchangeable shares. Brookfield Renewable is authorized to repurchase up to 14,361,497 LP
units and 8,982,586 BEPC exchangeable shares, representing 5% of each of its issued and outstanding LP units and
BEPC exchangeable shares. The bids will expire on December 17, 2024, or earlier should Brookfield Renewable
complete its repurchases prior to such date. During the year ended December 31, 2023, there were 1,856,044 LP
units (2022: nil) repurchased and cancelled at a total cost of $43 million (2022: nil). During the year ended
December 31, 2023, Brookfield Corporation purchased 441,363 units (2022: nil). There were no BEPC
exchangeable shares repurchased during the years ended December 31, 2023 or 2022. Subsequent to year-end,
Brookfield Renewable repurchased 496,254 LP units on the Toronto Stock Exchange at a total cost of $12 million.
Page 11
PART 4 – FINANCIAL PERFORMANCE REVIEW ON PROPORTIONATE
INFORMATION
SEGMENTED DISCLOSURES
Segmented information is prepared on the same basis that Brookfield Renewable’s Chief Executive Officer and Chief Financial Officer (collectively, the
chief operating decision maker or “CODM”) manages the business, evaluates financial results, and makes key operating decisions. See “PART 9 – Presentation
to Stakeholders and Performance Measurement” for information on segments and an explanation on the calculation and relevance of proportionate information,
Adjusted EBITDA and Funds From Operations which are non-IFRS measures.
PROPORTIONATE RESULTS FOR THE YEAR ENDED DECEMBER 31
The following chart reflects the generation and summary financial figures on a proportionate basis for the year ended December 31:
(GWh)
(MILLIONS)
Actual Generation
LTA Generation
Revenues
Adjusted EBITDA(1)
Funds From
Operations
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
Hydroelectric
North America ........................................................
11,603
11,285
12,161
12,161
$ 1,029 $ 964
$
670 $
Brazil ......................................................................
Colombia ................................................................
3,974
3,408
3,828
4,099
4,060
4,411
3,647
3,802
240
293
197
273
172
175
18,985
19,524
19,907
20,023
1,562
1,434
1,017
Wind
Utility-scale solar .....................................................
Distributed energy & storage .................................
Sustainable solutions ...............................................
Corporate .................................................................
6,367
2,489
1,241
—
—
5,951
7,865
6,797
1,878
3,123
2,406
1,050
956
886
—
—
—
—
—
511
365
241
147
538
374
242
48
—
—
—
493
372
180
61
59
603
167
201
971
430
362
189
8
42
$
402 $
146
76
624
382
261
133
52
412
138
117
667
326
253
148
6
(357)
(395)
Total
(1)
Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure see “Reconciliation of Non-IFRS Measures” in this Management’s Discussion and Analysis.
29,082
28,403
31,851
30,112
$ 2,826 $ 2,636
$
2,182 $ 2,002
$ 1,095 $
1,005
Page 12
HYDROELECTRIC OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for hydroelectric operations for the year ended December
31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2023
1,562 $
33
(578)
1,017
(367)
(26)
624 $
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
Average revenue per MWh .............................................................................................................
19,907
18,985
72
2022
1,434
47
(510)
971
(262)
(42)
667
20,023
19,524
68
The following table presents our proportionate results by geography for hydroelectric operations for the year
ended December 31:
(MILLIONS, EXCEPT AS NOTED)
North America
United States .................................................
Canada ...........................................................
Brazil ................................................................
Colombia ..........................................................
Total .................................................................
Actual
Generation
(GWh)
2023
2022
Average
revenue
per MWh(1)
2023
2022
Adjusted
EBITDA(2)
2023
2022
Funds From
Operations
2023
2022
7,766
3,837
11,603
3,974
3,408
18,985
7,109 $
4,176
11,285
3,828
4,411
19,524 $
84 $
63
77
60
69
72 $
83 $ 425 $ 363 $ 271 $ 270
142
240
63
412
603
76
138
167
51
117
201
62
68 $ 1,017 $ 971 $ 624 $ 667
131
402
146
76
245
670
172
175
(1) Average revenue per MWh was adjusted to net the impact of power purchases and any revenue with no corresponding generation.
(2) Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure see “Reconciliation of Non-IFRS Measures” in this
Management’s Discussion and Analysis.
North America
Funds From Operations at our North American business were $402 million in 2023 versus $412 million in the
prior year as the benefit from favorable hydrology conditions in the United States (9% above prior year) and higher
average revenue per MWh due to inflation indexation on our contracted generation was offset by lower resources in
our high value Canadian markets and higher interest expense due to financing initiatives completed to fund growth.
Brazil
Funds From Operations at our Brazilian business were $146 million in 2023 versus $138 million in the prior
year. Excluding a positive ruling that benefited the prior year ($15 million), Funds From Operations was $23 million
higher than the prior year due to favorable generation and higher average revenue per MWh due to inflation
indexation on contracted generation.
Page 13
Colombia
Funds From Operations at our Colombian business were $76 million in 2023 versus $117 million in the prior
year. On a constant currency basis, Adjusted EBITDA was in-line with the prior year as the benefit from higher
average revenue per MWh due to stronger market prices was offset by lower resources as the prior year benefited
from well above LTA conditions. This was offset by higher interest expense as a result of accelerated refinancing
initiatives completed in the first half of the prior year to fund growth and a weaker Colombian peso versus the U.S.
dollar.
WIND OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for wind operations for the year ended December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
2023
511 $
146
(164)
493
(105)
(6)
Funds From Operations .................................................................................................................. $
382 $
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
7,865
6,367
Average revenue per MWh ............................................................................................................. $
76 $
2022
538
56
(164)
430
(96)
(8)
326
6,797
5,951
82
Funds From Operations at our wind business were $382 million in 2023 versus $326 million in the prior year
primarily due to the benefit from growth, including the completion of our 850-megawatt repowering project in the
U.S, newly acquired and commissioned facilities ($31 million and 1,084 GWh), inflation indexation on our
contracted generation, and gains on sale of non-core assets and development assets being partially offset by lower
average revenue per MWh as a result of adjustments to the regulated price earned by our Spanish assets that
decreased revenues in the short term but has no impact on value given the regulatory construct.
UTILITY-SCALE SOLAR OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for utility-scale solar operations for the year ended
December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
2023
365 $
106
(99)
372
(110)
(1)
Funds From Operations .................................................................................................................. $
261 $
2022
374
90
(102)
362
(102)
(7)
253
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
Average revenue per MWh ............................................................................................................. $
3,123
2,489
147 $
2,406
1,878
197
Page 14
Funds From Operations at our utility-scale solar business were $261 million in 2023 versus $253 million in the
prior year, as the benefits from newly acquired and commissioned facilities ($16 million and 560 GWh) and gains
on sale of development assets was partially offset by lower generation on a same store basis and lower average
revenue per MWh due to adjustments to the regulated price earned by our Spanish assets that decreased revenues in
the short term but has no impact on value given the regulatory construct.
DISTRIBUTED ENERGY & STORAGE OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for distributed energy & storage business for the year
ended December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
2023
241 $
20
(81)
180
(43)
(4)
Funds From Operations .................................................................................................................. $
133 $
2022
242
23
(76)
189
(40)
(1)
148
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
Average revenue per MWh ............................................................................................................. $
956
1,241
174 $
886
1,050
197
Funds From Operations at our distributed energy & storage business were $133 million in 2023 versus $148
million in the prior year as the benefits from recent acquisitions and development activities and stronger resources
was offset by a decrease in average revenue per MWh due to generation mix and lower grid stability prices at our
pumped storage facilities driven by lower pricing volatility.
SUSTAINABLE SOLUTIONS OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for sustainable solutions business for the year ended
December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
2023
147 $
2022
48
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
19
(105)
61
(6)
(3)
Funds From Operations .................................................................................................................. $
52 $
3
(43)
8
(2)
—
6
Funds From Operations at our sustainable solutions business were $52 million in 2023 versus $6 million in the
prior year due to growth and development including our investment in Westinghouse, which closed in the fourth
quarter.
Page 15
CORPORATE
The following table presents our results for corporate for the year ended December 31:
(MILLIONS)
2023
Other income .................................................................................................................................. $
88 $
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Current income taxes ......................................................................................................................
Management service costs ..............................................................................................................
Interest expense ..............................................................................................................................
Distributions(1)
................................................................................................................................
(29)
59
—
(205)
(114)
(97)
Funds From Operations .................................................................................................................. $
(1)
Distributions on Preferred Units, Class A Preference Shares and Perpetual Subordinated Notes.
(357) $
2022
73
(31)
42
(1)
(243)
(94)
(99)
(395)
Page 16
PROPORTIONATE RESULTS FOR THE YEAR ENDED DECEMBER 31, 2022 AND 2021
The following chart reflects the generation and summary financial figures on a proportionate basis for the year ended December 31:
(GWh)
(MILLIONS)
Actual Generation
LTA Generation
Revenues
Adjusted EBITDA(1)
Funds From
Operations
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
Hydroelectric
North America ..................................................
11,285
10,470
12,161
12,167
$ 964 $
Brazil ................................................................
3,828
3,626
4,060
4,004
Colombia ..........................................................
4,411
3,950
3,802
3,555
197
273
876
169
224
19,524
18,046
20,023
19,726
1,434
1,269
Wind
5,951
6,096
6,797
7,249
Utility-scale solar ...............................................
1,878
1,777
2,406
2,016
Distributed energy & storage ...........................
Sustainable solutions .........................................
1,050
—
1,014
—
Corporate ...........................................................
—
—
886
—
—
861
—
—
—
$
603 $
167
201
971
430
362
189
8
42
569
155
159
883
511
298
160
13
11
$
412 $
138
117
667
326
253
148
6
409
131
128
668
396
185
128
5
(395)
(448)
538
374
242
48
556
348
215
27
—
Total ....................................................................
(1)
28,403
26,933
30,112
29,852
$ 2,636 $ 2,415
$ 2,002 $ 1,876
$ 1,005 $
934
Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure see “Reconciliation of Non-IFRS Measures” in this Management’s Discussion and Analysis.
Page 17
HYDROELECTRIC OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for hydroelectric operations the year ended December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2022
1,434 $
47
(510)
971
(262)
(42)
667 $
2021
1,269
92
(478)
883
(206)
(9)
668
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
20,023
19,524
19,726
18,046
The following table presents our proportionate results by geography for hydroelectric operations for the year
ended December 31:
(MILLIONS, EXCEPT AS NOTED)
North America
Actual
Generation
(GWh)
Average
revenue
Per MWh(1)
Adjusted
EBITDA(2)
Funds From
Operations
2022
2021
2022
2021
2022
2021
2022
2021
United States .............................................
7,109
7,088 $
83 $
72 $ 363 $ 359 $ 270 $ 256
Canada .......................................................
4,176
3,382
Brazil ............................................................
3,828
3,626
Colombia ......................................................
4,411
3,950
11,285
10,470
63
76
51
62
63
69
47
61
240
603
167
201
210
569
155
159
142
412
138
117
153
409
131
128
Total .............................................................
(1)
19,524
18,046 $
68 $
63 $ 971 $ 883 $ 667 $ 668
(2)
Average revenue per MWh was adjusted to net the impact of power purchases and any revenue with no corresponding generation.
Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure see “Reconciliation of Non-IFRS Measures” in this
Management’s Discussion and Analysis.
North America
Funds From Operations at our North American business were $412 million in 2022 versus $409 million in the
prior year as the benefit from favorable generation 8% above prior year and higher average revenue per MWh due to
inflation indexation on our contracted generation and strong market pricing environment was partly offset by
financing initiatives in Canada completed in 2021 to fund growth ($32 million).
Brazil
Funds From Operations at our Brazilian business were $138 million in 2022 versus $131 million in the prior
year. Excluding the impact of the positive ruling regarding historical under allocation of generation to our facilities
under the centralized pooling mechanism that benefited the prior year ($30 million), Funds From Operations was
significantly higher than prior year primarily due to favorable generation (3% above prior year) and higher average
revenue per MWh on our contracted generation due to inflation indexation as well as contribution from the
commissioning of a 30 MW hydroelectric facility in the second quarter of 2022 ($3 million and 84 GWh).
Page 18
Colombia
Funds From Operations at our Colombian business were $117 million in 2022 versus $128 million in the prior
year. On a local currency basis, Funds From Operations was 4% higher than the prior year due to the benefit from
newly acquired and commissioned facilities during the year ($14 million and 242 GWh), higher generation that was
16% above long-term average and higher average revenue per MWh due to inflation indexation and recontracting
initiatives, partly offset by interest expense as a result of accelerating refinancing initiatives. The increase was more
than offset by weakening of the Colombian peso versus the U.S. dollar.
WIND OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for wind operations for the year ended December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2022
538 $
56
(164)
430
(96)
(8)
326 $
2021
556
126
(171)
511
(106)
(9)
396
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
6,797
5,951
7,249
6,096
Funds From Operations at our wind business were $326 million in 2022 versus $396 million in the prior year.
On a same store basis, net of growth, and asset sales in 2021 at our North America and Europe portfolios ($130
million and 387 GWh), Funds From Operations were higher than prior year due to favorable resources and a higher
average revenue per MWh due to inflation indexation, generation mix and higher market prices in Spain.
UTILITY-SCALE SOLAR OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for utility-scale solar operations for the year ended
December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2022
374
90
(102)
362
(102)
(7)
253 $
2021
348
39
(89)
298
(111)
(2)
185
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
2,406
1,878
2,016
1,777
Funds From Operations at our utility-scale solar business were $253 million in 2022 versus $185 million in the
prior year, as the benefit from newly acquired and commissioned facilities, including a gain on sale of a solar
development project in North America ($25 million and 249 GWh), and higher market prices in Spain was partly
offset by lower resources.
Page 19
DISTRIBUTED ENERGY & STORAGE OPERATIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for distributed energy & storage business for the year
ended December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2022
242 $
23
(76)
189
(40)
(1)
148 $
2021
215
—
(55)
160
(30)
(2)
128
Generation (GWh) – LTA ...............................................................................................................
Generation (GWh) – actual ............................................................................................................
886
1,050
861
1,014
Funds From Operations at our distributed energy & storage business were $148 million in 2022 versus $128
million in the prior year primarily due to the benefit from growth and higher pricing for grid stability services
provided by our pumped storage facilities on the back of higher and more volatile power prices.
SUSTAINABLE SOLUTIONS ON PROPORTIONATE BASIS
The following table presents our proportionate results for sustainable solutions business for the year ended
December 31:
(MILLIONS, EXCEPT AS NOTED)
Revenue .......................................................................................................................................... $
Other income ..................................................................................................................................
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Interest expense ..............................................................................................................................
Current income taxes ......................................................................................................................
Funds From Operations .................................................................................................................. $
2022
48 $
3
(43)
8
(2)
—
6 $
2021
27
3
(17)
13
(8)
—
5
Funds From Operations at our sustainable solutions business were $6 million in 2022 versus $5 million in the
prior year primarily due to the benefit from the growth of our structured financial investments and business
transformation portfolios.
CORPORATE
The following table presents our results for corporate for the year ended December 31:
(MILLIONS)
2022
Other income .................................................................................................................................. $
73 $
Direct operating costs .....................................................................................................................
Adjusted EBITDA ..........................................................................................................................
Current income taxes ......................................................................................................................
Management service costs ..............................................................................................................
Interest expense ..............................................................................................................................
Distributions(1)
................................................................................................................................
(31)
42
(1)
(243)
(94)
(99)
Funds From Operations .................................................................................................................. $
(1)
Distributions on Preferred Units and Class A Preference Shares.
(395) $
2021
41
(30)
11
—
(288)
(78)
(93)
(448)
Page 20
RECONCILIATION OF NON-IFRS MEASURES
The following table reconciles the non-IFRS financial measures to the most directly comparable IFRS measures. Net income (loss) is reconciled to Adjusted
EBITDA for the year ended December 31, 2023:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility
-scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Net income (loss) ...................................................................................................................................................... $
207
$ 28
$
188
$
307
$ 209
$
(90) $
102
$
(335) $
616
Add back or deduct the following: ............................................................................................................................
Depreciation ...........................................................................................................................................................
424
101
127
709
348
Deferred income tax expense (recovery) ...............................................................................................................
Foreign exchange and financial instrument loss (gain) .........................................................................................
Other(1)
...................................................................................................................................................................
Management service costs .....................................................................................................................................
Interest expense .....................................................................................................................................................
Current income tax expense ..................................................................................................................................
Amount attributable to equity accounted investments and non-controlling interests(2)
.........................................
(69)
(153)
19
—
333
1
3
(2)
12
—
48
8
(92)
(26)
Adjusted EBITDA .....................................................................................................................................................
670
172
5
(7)
8
—
364
76
(586)
175
20
(239)
(43)
(17)
(111)
(171)
—
—
297
282
20
13
(510)
(249)
493
372
56
(37)
(5)
111
—
59
—
86
180
85
(22)
(89)
3
—
94
—
(112)
61
2
(33)
10
23
205
150
10
27
59
1,852
(176)
(502)
(106)
205
1,627
128
(1,462)
2,182
(1)
(2)
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue earning activities and are not normal, recurring cash
operating expenses necessary for business operations. Refer to Note 7 - Other Income in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated
Financial Statements for more details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized disposition gains and
losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted
for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries.
By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
Page 21
The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) for the year ended December 31, 2022:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility-
scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Net income (loss) .................................................................................................................................................. $
(72) $ 61
$
370
$
7
$
(56) $
122
$
2
$
(296) $
138
Add back or deduct the following: ........................................................................................................................
Depreciation .......................................................................................................................................................
Deferred income tax expense (recovery) ...........................................................................................................
Foreign exchange and financial instrument loss (gain) .....................................................................................
Other(1)
...............................................................................................................................................................
Management service costs .................................................................................................................................
Interest expense ..................................................................................................................................................
Current income tax expense ...............................................................................................................................
Amount attributable to equity accounted investments and non-controlling interests(2)
.....................................
414
(86)
255
21
—
302
3
91
(20)
(3)
13
—
47
8
108
40
(69)
31
—
237
112
552
35
(77)
113
—
254
16
291
(35)
80
109
—
195
7
96
(3)
(39)
—
—
78
—
28
(1)
(8)
77
—
2
2
3
1,583
(80)
(6)
93
243
109
—
(150)
133
457
243
1,224
148
(234)
(30)
(628)
(470)
(229)
(65)
(94)
(24)
(1,774)
Adjusted EBITDA ................................................................................................................................................. $
603
$ 167
$
201
$
430
$
362
$
189
$
8
$
42
$ 2,002
(1)
(2)
Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 9 - Other
in the Audited Consolidated Financial Statements for more details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and
realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted
for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries.
By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
Page 22
The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) for the year ended December 31, 2021:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility
-scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Net income (loss) .................................................................................................................................................. $
31
$ 56
$
222
$
(88) $
6
$
96
$
(32) $
(357) $
(66)
Add back or deduct the following: ........................................................................................................................
Depreciation .......................................................................................................................................................
Deferred income tax expense (recovery) ...........................................................................................................
Foreign exchange and financial instrument loss (gain) ......................................................................................
Other(1)
................................................................................................................................................................
368
(50)
74
(3)
74
(2)
2
13
Management service costs ..................................................................................................................................
—
—
Interest expense ..................................................................................................................................................
Current income tax expense ...............................................................................................................................
Amount attributable to equity accounted investments and non-controlling interests(2)
.....................................
255
3
33
9
(109)
(30)
Adjusted EBITDA .................................................................................................................................................
569
155
103
175
(29)
39
—
119
13
(483)
159
597
263
(37)
40
151
(34)
(23)
92
—
—
247
187
13
5
(412)
(198)
511
298
83
(9)
5
25
—
12
—
(52)
160
11
1
(1)
27
—
36
—
(29)
13
2
(73)
(36)
108
288
92
—
(13)
11
1,501
(29)
32
452
288
981
43
(1,326)
1,876
(1)
(2)
Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 9 - Other
in the Audited Consolidated Financial Statements for more details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and
realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted
for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries.
By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
Page 23
The following table reconciles the non-IFRS financial measures to the most directly comparable IFRS
measures. Net income (loss) is reconciled to Funds From Operations for the years indicated:
(MILLIONS)
Net income (loss) ......................................................................................................... $
Add back or deduct the following: ...............................................................................
Depreciation ..............................................................................................................
Deferred income tax recovery ...................................................................................
Foreign exchange and financial instruments (gain) loss ...........................................
Other(1)
.......................................................................................................................
Amount attributable to equity accounted investments and non-controlling interest(2)
.
Funds From Operations ................................................................................................ $
2023
2022
616 $
138 $
1,852
(176)
(502)
(106)
(589)
1,583
(150)
133
457
(1,156)
1,095 $
1,005 $
2021
(66)
1,501
(29)
32
452
(956)
934
(1)
(2)
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue
earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 7 - Other Income
in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated Financial Statements for more
details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized
disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the Funds From Operations that are generated by its investments in
associates and joint ventures accounted for using the equity method. Amounts attributable to non-controlling interest are calculated based on
the economic ownership interest held by non-controlling interests in consolidated subsidiaries. By adjusting Funds From Operations
attributable to non-controlling interest, our partnership is able to remove the portion of Funds From Operations earned at non-wholly owned
subsidiaries that are not attributable to our partnership.
The following table reconciles the per unit non-IFRS financial measures to the most directly comparable IFRS
measures. Basic earnings per LP unit is reconciled to Funds From Operations per Unit, for the years indicated:
................................................................................................ $
Basic loss per LP unit(1)
Depreciation .................................................................................................................
Foreign exchange and financial instruments (gain) loss ..............................................
Deferred income tax recovery .....................................................................................
Other(2)
..........................................................................................................................
Funds From Operations per Unit(3)
............................................................................... $
2023
2022
(0.32) $
(0.60) $
1.55
(0.21)
(0.19)
0.84
1.45
0.30
(0.24)
0.65
1.67 $
1.56 $
2021
(0.69)
1.43
0.20
(0.21)
0.72
1.45
(1)
(2)
(3)
During the year ended December 31, 2023, on average there were 282.4 million LP units outstanding (2022: 275.2 million, 2021:
274.9 million).
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue
earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 7 - Other Income
in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated Financial Statements for more
details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized
disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Average units outstanding, for the year ended December 31, 2023, were 657.1 million (2022: 645.9 million, 2021: 645.6 million), being
inclusive of GP interest, Redeemable/Exchangeable partnership units, LP units, and BEPC exchangeable shares.
Page 24
CONTRACT PROFILE
We operate our power business on a largely contracted basis to provide a high degree of predictability in Funds
From Operations. We maintain a long-term view that electricity prices and the demand for electricity will rise due to
electrification of the global economy including segments like industrial and transportation as well as from increasing
digitalization. We also expect demand for clean power to grow on the increasing level of acceptance around climate
change, the legislated requirements in some areas to diversify away from fossil fuel based generation and because
renewables are the cheapest form of bulk electricity generation.
In Brazil and Colombia, we also expect power prices will continue to be supported by the need to build new
supply over the medium-to-long term to serve growing demand. In these markets, contracting for power is the only
current mechanism to buy and sell power, and therefore we would expect to capture rising prices as we re-contract
our power over the medium-term.
The following table sets out our power contracts over the next five years for generation output in North
America, Brazil, Europe and certain other countries, assuming long-term average on a proportionate basis. The table
excludes Brazil and Colombia hydroelectric portfolios, where we would expect the energy associated with maturing
contracts to be re-contracted in the normal course given the construct of the respective power markets. In these
countries we currently have a contracted profile of approximately 93% and 70%, respectively, of the long-term
average and we would expect to maintain this going forward. Overall, our power portfolio has a weighted-average
remaining contract duration of 13 years on a proportionate basis.
(GWh, except as noted)
Hydroelectric
North America
United States(1)
.............................................................
Canada ..........................................................................
Wind ..................................................................................
Utility-scale solar ..............................................................
Distributed energy & storage ............................................
Sustainable solutions .........................................................
Contracted on a proportionate basis .....................................
Uncontracted on a proportionate basis .................................
Long-term average on a proportionate basis ........................
Non-controlling interests .....................................................
Total long-term average .......................................................
Contracted generation as a % of total generation on a
proportionate basis ...........................................................
Price per MWh – total generation on a proportionate basis . $
(1)
2024
2025
2026
2027
2028
7,261
3,620
10,881
7,979
3,765
983
44
23,652
3,376
27,028
45,043
72,071
6,728
3,620
10,348
7,934
3,802
974
36
23,094
3,934
27,028
45,043
72,071
5,602
3,620
9,222
7,837
3,792
963
32
21,846
5,182
27,028
45,043
72,071
5,318
3,620
8,938
7,537
3,782
944
32
21,233
5,795
27,028
45,043
72,071
4,674
3,620
8,294
7,404
3,745
931
31
20,405
6,623
27,028
45,043
72,071
88 %
79
$
85 %
79
$
81 %
80
$
79 %
81
$
75 %
83
Includes generation of 1,777 GWh for 2024, 1,546 GWh for 2025, 947 GWh for 2026, and 640 GWh for 2027 secured under financial
contracts.
Weighted-average remaining power contract durations on a proportionate basis are 15 years in North America,
13 years in Europe, 9 years in Brazil, 4 years in Colombia, and 13 years across our remaining jurisdictions.
In North America, over the next five years, a number of contracts will expire at our hydroelectric facilities.
Based on current market prices for energy and ancillary products, we expect a net positive impact to cash flows.
In our Colombian portfolio, we continue to focus on securing long-term contracts while maintaining a certain
percentage of uncontracted generation so as to mitigate hydrology risk.
The majority of Brookfield Renewable’s long-term power purchase agreements within our North American and
European businesses are with investment-grade rated or creditworthy counterparties. The economic exposure of our
contracted generation on a proportionate basis is distributed as follows: power authorities (37%), distribution
companies (22%), commercial and industrial users (29%), and Brookfield (12%).
Page 25
PART 5 – LIQUIDITY AND CAPITAL RESOURCES
CAPITALIZATION
A key element of our financing strategy is to raise the majority of our debt in the form of asset-specific, non-
recourse borrowings at our subsidiaries on an investment-grade basis with no maintenance covenants. Substantially
all of our debt is either investment grade rated or sized to investment grade and approximately 91% of debt is non-
recourse.
The following table summarizes our capitalization as at December 31:
(MILLIONS, EXCEPT AS NOTED)
Commercial paper(1)
Debt
Medium-term notes(2)
Non-recourse borrowings(3)
..........................................................
.................................................
Deferred income tax liabilities, net(4)
Equity
.....................................
Non-controlling interest ......................................................
Preferred equity ...................................................................
Perpetual subordinated notes ..............................................
Preferred limited partners’ equity .......................................
Unitholders’ equity .............................................................
Corporate
Consolidated
2023
183
2,660
—
2,660
—
—
583
592
760
9,181
2022
249
2,307
—
2,307
—
—
571
592
760
9,608
2023
183
2,660
27,020
29,680
6,930
18,863
583
592
760
9,181
Total capitalization ................................................................. $
Debt-to-total capitalization ....................................................
Debt-to-total capitalization (market value)(5)
.........................
13,776 $
19 %
12 %
13,838 $
17 %
11 %
66,589 $
45 %
40 %
2022
249
2,307
22,321
24,628
6,331
14,755
571
592
760
9,608
57,245
43 %
39 %
(1)
Draws on corporate credit facilities and commercial paper issuances are excluded from the debt-to-total capitalization ratios as they are not
a permanent source of capital.
(2) Medium-term notes are unsecured and guaranteed by Brookfield Renewable and excludes $10 million (2022: $8 million) of deferred
(3)
(4)
(5)
financing fees, net of unamortized premiums.
Consolidated non-recourse borrowings include $2,626 million (2022: $1,838 million) borrowed under a subscription facility of a Brookfield
sponsored private fund and excludes $140 million (2022: $124 million) of deferred financing fees and $11 million (2022: $105 million) of
unamortized premiums.
Deferred income tax liabilities less deferred income tax assets.
Based on market values of Preferred equity, Perpetual subordinated notes, Preferred limited partners’ equity and Unitholders’ equity.
Page 26
AVAILABLE LIQUIDITY
The following table summarizes the available liquidity as at December 31:
(MILLIONS)
Brookfield Renewable's share of cash and cash equivalents .......................................................... $
Investments in marketable securities ..............................................................................................
Corporate credit facilities
Authorized credit facilities ..........................................................................................................
Draws on credit facilities(1)
..........................................................................................................
Authorized letter of credit facility ...............................................................................................
Issued letters of credit ..................................................................................................................
Available portion of corporate credit facilities ..............................................................................
Available portion of subsidiary credit facilities on a proportionate basis ......................................
2023
567 $
309
2,375
(165)
500
(307)
2,403
842
Available liquidity .......................................................................................................................... $
(1)
Relates to letter of credit issued against Brookfield Renewable’s corporate credit facilities.
4,121 $
2022
444
211
2,375
—
500
(344)
2,531
509
3,695
We operate with sufficient liquidity to enable us to fund growth initiatives, capital expenditures, distributions
and withstand sudden adverse changes in economic circumstances or short-term fluctuations in generation. We
maintain a strong, investment grade balance sheet characterized by a conservative capital structure, access to
multiple funding levers including a focus on capital recycling on an opportunistic basis, and diverse sources of
capital. Principal sources of liquidity are cash flows from operations, our credit facilities, up-financings on non-
recourse borrowings and proceeds from the issuance of various securities through public markets.
Page 27
BORROWINGS
The composition of debt obligations, overall maturity profile, and average interest rates associated with our
borrowings and credit facilities on a proportionate basis as at December 31 is presented in the following table:
2023
Weighted-average
Interest
rate %(1)
Term
(years)
2022
Weighted-average
Total(1)
Interest
rate %(1)
Term
(years)
Total(1)
(MILLIONS, EXCEPT AS NOTED)
Corporate borrowings
Credit facilities ........................................................
Commercial paper ...................................................
Medium-term notes .................................................
Proportionate non-recourse borrowings(2)(3)
Hydroelectric ...........................................................
Wind ........................................................................
Utility-scale solar ....................................................
Distributed energy and storage ................................
Sustainable solutions ...............................................
N/A
6.0
4.3
6.0
5.0
5.1
4.5
6.6
5.4
Proportionate unamortized financing fees, net of unamortized premiums .......
Equity-accounted borrowings ...........................................................................
Non-controlling interests and other(4)
...............................................................
As per IFRS Statements ....................................................................................
(1)
(2)
(3)
(4)
Includes cash yields on tax equity.
Includes adjustments for project-level refinancing subsequent to December 31, 2023.
See “Part 8 – Presentation to Stakeholders and Performance Measurement” for information on proportionate debt.
Includes tax equity liability.
5
$ —
<1
10
12
9
13
8
7
12
183
2,660
5,215
2,408
2,596
917
391
11,527
$ 14,370
(88)
14,282
(987)
16,407
$ 29,702
N/A
5.1
4.1
5.7
4.6
3.6
4.3
—
4.9
5
$
—
<1
11
13
9
13
9
—
249
2,307
5,150
1,935
2,367
897
—
12
10,349
$ 12,905
(64)
12,841
(373)
12,382
$ 24,850
Page 28
The following table summarizes our undiscounted principal repayments, scheduled amortization and interest
repayable on a proportionate basis as at December 31, 2023:
(MILLIONS)
Debt principal repayments(1)
2024
2025
2026
2027
2028 Thereafter
Total
Medium-term notes(2)
Non-recourse borrowings(3)
Hydroelectric ...............................................
.................................... $ — $
Wind ............................................................
Utility-scale solar .........................................
Distributed energy & storage .......................
Sustainable solutions ...................................
Amortizing debt principal repayments
Non-recourse borrowings
Hydroelectric ...............................................
Wind ............................................................
Utility-scale solar .........................................
Distributed energy & storage .......................
Sustainable solutions ...................................
Total .................................................................. $
Interest payable(1)(2)(4)
.....................................
Medium-term notes(1)
Non-recourse borrowings ............................
.................................. $
Hydroelectric ...............................................
Wind ............................................................
Utility-scale solar .........................................
Distributed energy & storage .......................
Sustainable solutions ...................................
302 $ — $
377 $ — $
1,981 $ 2,660
385
19
21
153
5
583
164
178
161
38
2
543
269
172
73
43
—
2
1
1
1
1
387
176
180
175
150
36
1
542
152
173
154
31
—
510
189
186
196
66
12
649
174
154
149
30
—
507
1,309
2,404
298
280
195
344
677
543
418
365
2,426
4,407
1,985
855
1,286
336
—
2,818
1,729
2,052
514
7
4,462
7,120
80
100
2
3
1
186
163
194
152
43
4
556
742 $ 1,428 $
929 $ 1,063 $ 1,156 $
8,869 $ 14,187
113 $
107 $
102 $
95 $
88 $
669 $ 1,174
320
118
113
43
26
620
291
99
115
38
25
568
258
87
106
31
26
508
229
200
1,571
2,869
76
97
29
25
64
85
27
25
172
356
48
4
616
872
216
131
456
401
2,151
4,704
733 $
675 $
610 $
551 $
489 $
2,820 $ 5,878
Total .................................................................. $
(1)
Draws on corporate credit facilities and commercial paper issuances are excluded from the debt repayment schedule as they are not a
permanent source of capital.
(2) Medium-term notes are unsecured and guaranteed by Brookfield Renewable and excludes $10 million (2022: $8 million) of deferred
(3)
(4)
financing fees, net of unamortized premiums.
Includes adjustments for project-level refinancing subsequent to December 31, 2023.
Represents aggregate interest payable expected to be paid over the entire term of the obligations, if held to maturity. Variable rate interest
payments have been calculated based on estimated interest rates.
We remain focused on refinancing near-term facilities on acceptable terms and maintaining a manageable
maturity ladder. We do not anticipate material issues in addressing our borrowings through 2028 on acceptable
terms and will do so opportunistically based on the prevailing interest rate environment.
CAPITAL EXPENDITURES
We fund growth capital expenditures with cash flow generated from operations, supplemented by non-recourse
debt sized to investment grade coverage and covenant thresholds. This is designed to ensure that our investments
have stable capital structures supported by a substantial level of equity and that cash flows at the asset level can be
remitted freely to our company. This strategy also underpins our investment grade profile.
Page 29
To fund large scale development projects and acquisitions, we will evaluate a variety of capital sources
including proceeds from selling mature businesses and upfinancings, in addition to raising money in the capital
markets through equity, debt and preferred share issuances. Furthermore, we have $2.38 billion committed revolving
credit facilities available for investments and acquisitions, as well as funding the equity component of organic
growth initiatives. The facilities are intended, and have historically been used, as a bridge to a long-term financing
strategy rather than a permanent source of capital.
CONSOLIDATED STATEMENTS OF CASH FLOWS
The following table summarizes the key items in the audited annual consolidated statements of cash flows, for
the year ended December 31:
(MILLIONS)
Cash flow provided by (used in):
2023
2022
2021
Operating activities .....................................................................................................
Financing activities .....................................................................................................
1,865
2,596
1,711
3,489
734
2,143
Investing activities .......................................................................................................
(4,356)
(5,066)
(2,544)
Foreign exchange (loss) gain on cash .........................................................................
38
(28)
Increase in cash and cash equivalents ......................................................................... $
143 $
106 $
(35)
298
Operating Activities
Cash flows provided by operating activities for the year ended December 31, 2023, totaled $1,865 million
compared to $1,711 million in 2022 and $734 million in 2021, reflecting the strong operating performance of our
business during the period.
Financing Activities
Cash flows provided by financing activities totaled $2,596 million for the year ended December 31, 2023. The
strength of our balance sheet and access to diverse sources of capital allowed us to fund the growth as discussed
below and allowed us to generate net proceeds of $2,208 million for the year ended December 31, 2023, including
the issuance of C$400 million ($293 million) of medium term notes and $630 million of equity financing net of
transaction fees through a bought deal of both LP units and BEPC exchangeable shares, and a concurrent private
placement of LP units during the second quarter of 2023.
Distributions, including incentive distributions to the general partners, paid during the year ended December 31,
2023, 2022 and 2021 to Unitholders were $990 million, $915 million and $854 million, respectively. We increased
our distributions to $1.35 per LP unit in 2023 (2022: $1.28 and 2021: $1.22), representing a 5.5% increase per LP
unit, which took effect in the first quarter of 2023. The distributions paid to preferred shareholders, preferred limited
partners' unitholders, perpetual subordinate notes, and participating non-controlling interests in operating
subsidiaries during the year ended December 31, 2023, 2022 and 2021 totaled $967 million, $1,372 million and
$900 million, respectively. Our non-controlling interest contributed capital, net of capital repaid, of $2,345 million
during the year ended December 31, 2023.
Cash flows provided by financing activities totaled $3,489 million for the year ended December 31, 2022. The
strength of our balance sheet and access to diverse sources of capital allowed us to fund the growth of our business
and generate $3,486 million of net proceeds from commercial paper, corporate and non-recourse upfinancings, as
well as issue $115 million of fixed-rate green perpetual Class A preferred limited partnership units and $296 million
of 10-year corporate green bonds.
Cash flows provided by financing activities totaled $2,143 million for the year ended December 31, 2021. The
strength of our balance sheet and access to diverse sources of capital allowed us to fund the growth of our business
and generate $3,225 million of net proceeds from corporate and non-recourse upfinancings, including a
C$1.1 billion strategic financing of a Canadian hydro facility concurrent with signing a power purchase agreement
with Hydro Quebec and $592 million of net proceeds from the issuance of our inaugural perpetual green
subordinated notes. During the year, we redeemed our Series 9 Preferred Limited Partnership Units for $153 million.
Page 30
Investing Activities
Cash flows used in investing activities totaled $4,356 million for the year ended December 31, 2023. During the
year, we invested $2,160 million into growth including the acquisition of Westinghouse through a strategic
partnership, the purchase of an incremental 4% interest in X-Elio, a developer and operator of renewable power
assets in the US with 5,900 MW of operating and under construction assets and a 6,100 MW development pipeline,
a UK renewable developer with 260 MW onshore wind assets, 800 MW near-term development and another 3 GW
of later stage projects, renewable platforms in India with 4,500 MW of operating and development assets, 136 MW
and 60 MW portfolios of operating wind assets in Brazil, a distributed generation platform with approximately 730
MW of development pipeline in Brazil, and a 200 MW solar development project in China. Our continued
investment in our property, plant and equipment, including 675 MW of wind, solar and distributed generation
development projects in the U.S., 248 MW of wind development projects in Brazil, 281 MW of wind development
projects in China, 268 MW of solar development assets in India and 60 MW of solar assets in Colombia totaled
$2,809 million for the year ended December 31, 2023, partially offset by proceeds of $648 million generated from
the sale of non-core wind and solar assets and securities for the year ended December 31, 2023.
Cash flows used in investing activities totaled $5,066 million for the year ended December 31, 2022. During the
year, we invested $2,452 million into growth, including, an over 800 MW portfolio of operating wind assets and a
development pipeline of over 22 GW, a 20 GW portfolio of utility solar and energy storage development platform in
the United States, a distributed generation developer with 500 MW of contracted operating and under construction
assets, and an 1.8 GW of development pipeline in the United States, a 1.7 GW of utility-scale solar development
portfolio in Germany and an 83% interest in a 437 MW distributed generation portfolio of high quality operating and
development assets in Chile. Our continued investment in our property, plant and equipment, including the
acquisitions of over 400 MW of operating and development wind portfolios in Brazil and China, as well as the
construction of 1,200 MW solar facility in Brazil and the repowering of an 845 MW wind farm in Oregon, totaled
$2,190 million for the year ended December 31, 2022.
Cash flows used in investing activities totaled $2,544 million for the year ended December 31, 2021. During the
year, we recycled the capital from the sale of wind portfolios in Europe and the United States, which closed in the
second and third quarter of 2021 for $379 million and $448 million, respectively, into accretive growth opportunities,
investing $1,480 million to acquire, among others, an 845 MW wind portfolio, a distributed generation platform
comprised of 360 MW of operating and under construction solar assets with a development pipeline of over 700
MW of development assets in the United States, and a 23% interest in a scale renewable business in Europe with an
interest in a 3,000 MW offshore wind development pipeline. Our continued investment in our property, plant and
equipment, including the construction of 1,800 MW of solar developments projects in Brazil, of which 357 MW
reached commercial operations during the year, and the continuing initiative to repower existing wind power
projects, totaled $1,967 million for the year ended December 31, 2021.
Page 31
SHARES, NOTES AND UNITS OUTSTANDING
Shares and units outstanding as at December 31 are as follows:
Class A Preference Shares(1)
................................................................................................
Perpetual Subordinated Notes ............................................................................................
Preferred Units(2)
..................................................................................................................
GP interest ............................................................................................................................
Redeemable/Exchangeable partnership units ...................................................................
BEPC exchangeable shares .................................................................................................
December 31, 2023 December 31, 2022
31,035,967
24,400,000
38,000,000
3,977,260
194,487,939
31,035,967
24,400,000
38,000,000
3,977,260
194,487,939
Balance, beginning of year ..................................................................................................
172,218,098
172,203,342
Issuance ...............................................................................................................................
7,441,893
Exchanged for BEP LP units ...............................................................................................
(8,465)
27,064
(12,308)
Balance, end of period ............................................................................................................
LP units
Balance, beginning of year ..................................................................................................
Issuance ...............................................................................................................................
Repurchase of LP units for cancellation .............................................................................
Distribution reinvestment plan ............................................................................................
Issued in exchange for BEPC exchangeable shares ............................................................
Balance, end of period ............................................................................................................
Total LP units on a fully-exchanged basis(3)
..........................................................................
179,651,526
172,218,098
275,358,750
13,348,270
(1,856,044)
304,899
8,465
287,164,340
661,303,805
275,084,265
—
—
262,177
12,308
275,358,750
642,064,787
(1)
(2)
(3)
Class A Preference Shares are broken down by series as follows: 6,849,533 Series 1 Class A Preference Shares are outstanding; 3,110,531
Series 2 Class A Preference Shares are outstanding; 9,961,399 Series 3 Class A Preference Shares are outstanding; 4,114,504 Series 5 Class
A Preference Shares are outstanding; and 7,000,000 Series 6 Class A Preference Shares are outstanding.
Preferred Units are broken down by series and certain series are convertible on a one for one basis at the option of the holder as follows:
7,000,000 Series 7 Preferred Units are outstanding (convertible for Series 8 Preferred Units beginning on January 31, 2026); 10,000,000
Series 13 Preferred Units are outstanding (convertible for Series 14 Preferred Units beginning on April 30, 2028); 7,000,000 Series 15
Preferred Units are outstanding (convertible for Series 16 Preferred Units beginning on April 30, 2024); 8,000,000 Series 17 Preferred Units
are outstanding; and 6,000,000 Series 18 Preferred Units are outstanding.
The fully-exchanged amounts assume the exchange of all Redeemable/Exchangeable partnership units and BEPC exchangeable shares for
LP units.
DIVIDENDS AND DISTRIBUTIONS
The following table summarizes the dividends and distributions declared and paid, for the year ended December
31:
(MILLIONS)
Class A Preference Shares .........................................................
Perpetual Subordinated Notes ...................................................
Class A Preferred LP units ........................................................
Participating non-controlling interests – in operating
Declared
Paid
2023
2022
2021
2023
2022
2021
$
$
$
27 $
26 $
26 $
27 $
26 $
29 $
29 $
12 $
29 $
27 $
41 $
44 $
55 $
41 $
44 $
26
9
55
subsidiaries ............................................................................
$ 1,428 $ 1,275 $
810 $
870 $ 1,275 $
810
GP Interest and incentive distributions .....................................
Redeemable/Exchangeable partnership units ............................
BEPC exchangeable shares .......................................................
LP units .....................................................................................
$
$
$
$
116 $ 100 $
85 $
116 $
100 $
85
265 $ 250 $
237 $
263 $
250 $
237
241 $ 220 $
209 $
241 $
220 $
207
383 $ 355 $
335 $
370 $
345 $
325
Page 32
LP unit distributions per unit on an annualized basis were increased as follows:
Date of
Increase
February 2020
February 2021
February 2022
February 2023
February 2024
Amount of
Increase
% Increase
Annual
Distribution
Distribution
Effective Date
$0.06
$0.06
$0.06
$0.07
$0.07
5%
5%
5%
5%
5%
$1.16
$1.22
$1.28
$1.35
$1.42
March 2020
March 2021
March 2022
March 2023
March 2024
CONTRACTUAL OBLIGATIONS
Please see Note 27 – Commitments, contingencies and guarantees in the audited annual consolidated financial
statements for further details on the following:
•
•
•
Commitments – Water, land, and dam usage agreements, and agreements and conditions on
committed acquisitions of operating portfolios and development projects;
Contingencies – Legal proceedings, arbitrations and actions arising in the normal course of business,
and providing for letters of credit; and
Guarantees – Nature of all the indemnification undertakings and guarantees to third-parties for
certain transactions.
SUPPLEMENTAL FINANCIAL INFORMATION
In April 2021 and December 2021, Brookfield BRP Holdings (Canada) Inc., a wholly-owned subsidiary of
Brookfield Renewable, issued $350 million and $260 million, respectively, of perpetual subordinated notes at a
fixed rate of 4.625% and 4.875%, respectively.
These notes are fully and unconditionally guaranteed, on a subordinated basis by each of Brookfield Renewable
Partners L.P., BRELP, BRP Bermuda Holdings I Limited, Brookfield BRP Europe Holdings Limited, and BEP
Subco Inc (together, the "guarantor subsidiaries"). The other subsidiaries of Brookfield Renewable do not guarantee
the securities and are referred to below as the “non-guarantor subsidiaries”.
Pursuant to Rule 13-01 of the SEC's Regulation S-X, the following table provides combined summarized
financial information of Brookfield BRP Holdings (Canada) Inc. and the guarantor subsidiaries for the year ended
December 31:
(MILLIONS)
Revenues(1)
Gross profit ......................................................................................................
...................................................................................................... $
Dividend income from non-guarantor subsidiaries .........................................
Net income ......................................................................................................
2023
— $
—
511
428
2022
— $
—
777
708
2021
—
—
562
532
(1)
Brookfield Renewable's total revenues for the year ended December 31, 2023 were $5,038 million (2022: $4,711 million and 2021:
$4,096 million).
(MILLIONS)
Current assets(1)
Total assets(2)(3)
Current liabilities(4)
Total liabilities(4)
(1)
...................................................................................................................................... $
.......................................................................................................................................
.................................................................................................................................
.....................................................................................................................................
December 31, 2023
December 31, 2022
820
2,253
7,862
7,877
776 $
2,521
8,399
8,455
(2)
(3)
(4)
Amount due from non-guarantor subsidiaries was $767 million (2022: $809 million).
Brookfield Renewable's total assets as at December 31, 2023 and December 31, 2022 were $76,128 million and $64,111 million.
Amount due from non-guarantor subsidiaries was $2,421 million (2022: $2,167 million).
Amount due to non-guarantor subsidiaries was $8,045 million (2022: $7,408 million).
Page 33
OFF-STATEMENT OF FINANCIAL POSITION ARRANGEMENTS
Brookfield Renewable does not have any off-statement of financial position arrangements that have or are
reasonably likely to have a material current or future effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are
material to investors.
Brookfield Renewable issues letters of credit from its corporate credit facilities for general corporate purposes
which include, but are not limited to, security deposits, performance bonds and guarantees for reserve accounts. As
at December 31, 2023, letters of credit issued amounted to $2,126 million (2022: $1,609 million).
Page 34
PART 6 – SELECTED QUARTERLY INFORMATION
HISTORICAL OPERATIONAL AND FINANCIAL INFORMATION
YEAR ENDED DECEMBER 31
(MILLIONS, EXCEPT AS NOTED)
Operational information:
2023
2022
2021
Capacity (MW) ..................................................................................................................
32,949
25,377
21,049
Total generation (GWh)
Long-term average generation .......................................................................................
Actual generation ...........................................................................................................
75,584
69,704
63,656
63,036
58,913
56,629
Proportionate generation (GWh)
Actual generation ...........................................................................................................
29,467
28,669
27,150
.............................................................................. $ (100)
Additional financial information:
Net loss attributable to Unitholders
Basic loss per LP unit(1)
Proportionate Adjusted EBITDA(2)
Funds From Operations(2)
Funds From Operations per Unit(2)(3)
Distribution per LP unit .....................................................................................................
...................................................................................................
..................................................................................................
...................................................................................
.................................................................................
$ (295)
$ (368)
(0.60)
2,002
1,005
1.56
1.28
(0.69)
1,876
934
1.45
1.22
(0.32)
2,182
1,095
1.67
1.35
YEAR ENDED DECEMBER 31
2023
(MILLIONS, EXCEPT AS NOTED)
Property, plant and equipment, at fair value ..................................................................... $ 64,005
2022
$ 54,283
2021
$ 49,432
Equity-accounted investments ...........................................................................................
Total assets ........................................................................................................................
Total borrowings ...............................................................................................................
Deferred income tax liabilities ..........................................................................................
Other liabilities ..................................................................................................................
Participating non-controlling interests – in operating subsidiaries ...................................
General partnership interest in a holding subsidiary held by Brookfield ..........................
Participating non-controlling interests – in a holding subsidiary – Redeemable/
Exchangeable units held by Brookfield ........................................................................
BEPC exchangeable shares ...............................................................................................
Preferred equity .................................................................................................................
Perpetual subordinated notes .............................................................................................
Preferred limited partners’ equity .....................................................................................
Limited partners’ equity ....................................................................................................
Total liabilities and equity .................................................................................................
Debt-to-total capitalization (market value)(4)
....................................................................
2,546
76,128
29,702
7,174
9,273
18,863
55
2,684
2,479
583
592
760
3,963
76,128
40 %
1,392
64,111
24,850
6,507
6,468
14,755
59
2,892
2,561
571
592
760
4,096
64,111
39 %
1,107
55,867
21,529
6,215
4,127
12,303
59
2,894
2,562
613
592
881
4,092
55,867
33 %
(1)
(2)
(3)
(4)
For the year ended December 31, 2023, average LP units totaled 282.4 million (2022: 275.2 million and 2021: 274.9 million)
Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure, See “Cautionary Statement Regarding Use of Non-
IFRS Measures” and “PART 4 – Financial Performance Review on Proportionate Information – Reconciliation of Non-IFRS Measures”.
Average Units outstanding for the year ended December 31, 2023 totaled 657.1 million (2022: 645.9 million and 2021: 645.6 million) being
inclusive of our LP units, Redeemable/Exchangeable partnership units, BEPC exchangeable shares and GP interest.
Based on market values of Preferred equity, Perpetual subordinated notes, Preferred limited partners’ equity and Unitholders’ equity.
Page 35
SUMMARY OF HISTORICAL QUARTERLY RESULTS
The following is a summary of unaudited quarterly financial information for the last eight consecutive quarters:
2023
2022
(MILLIONS, EXCEPT AS NOTED)
Q4
Q3
Q2
Q1
Q4
Q3
Q2
Q1
Total Generation (GWh) – LTA ..........................................................................................................
22,641
16,800
18,622
17,636
17,692
15,097
16,280
15,097
Total Generation (GWh) – actual .........................................................................................................
17,006
15,870
17,798
18,875
16,450
14,906
16,488
15,196
Proportionate Generation (GWh) – LTA .............................................................................................
Proportionate Generation (GWh) – actual ...........................................................................................
8,512
7,151
7,112
6,533
8,403
7,543
7,899
8,243
7,655
6,826
6,905
6,440
8,152
7,978
7,414
7,425
Revenues ..............................................................................................................................................
$ 1,323 $ 1,179 $ 1,205 $ 1,331 $ 1,196 $ 1,105 $
1,274 $ 1,136
Net income (loss) attributable to Unitholders ..................................................................................
Basic loss per LP unit .........................................................................................................................
Funds From Operations ........................................................................................................................
Funds From Operations per Unit ..........................................................................................................
Distribution per LP unit .......................................................................................................................
35
0.01
255
0.38
0.34
(64)
(0.14)
253
0.38
0.34
(39)
(0.10)
312
0.48
0.34
(32)
(0.09)
275
0.43
0.34
(82)
(0.16)
225
0.35
0.32
(136)
(0.25)
243
0.38
0.32
1
(0.03)
294
0.46
0.32
(78)
(0.16)
243
0.38
0.32
Page 36
PROPORTIONATE RESULTS FOR THE THREE MONTHS ENDED DECEMBER 31
The following chart reflects the generation and summary financial figures on a proportionate basis for the three months ended December 31:
(GWh)
Actual Generation
LTA Generation
Revenues
2023
2022
2023
2022
2023
2022
(MILLIONS)
Adjusted
EBITDA(1)
2023
2022
Funds From
Operations
2023
2022
Hydroelectric
North America ..............................................................................
2,456
2,427
2,910
2,910 $
199 $
219 $
121 $
131 $
55 $
Brazil ............................................................................................
892
960
1,036
1,020
Colombia ......................................................................................
789
1,222
995
1,064
4,137
4,609
4,941
4,994
Wind ...............................................................................................
1,978
1,531
2,529
1,929
Utility-scale solar ...........................................................................
Distributed energy & storage(2)
....................................................
Sustainable solutions .....................................................................
Corporate .......................................................................................
658
272
—
—
414
209
—
—
834
189
—
—
551
181
—
—
59
87
345
138
85
51
93
—
55
68
342
143
77
70
13
—
40
41
202
131
121
42
28
6
40
58
229
124
54
48
2
4
87
38
33
158
97
29
35
1
34
16
105
103
93
26
22
(94)
(95)
Total ................................................................................................
(1)
7,045
6,763
8,493
7,655 $
712 $
645 $
530 $
461 $
255 $
225
(2)
Non-IFRS measures. For reconciliations to the most directly comparable IFRS measure see “Reconciliation of Non-IFRS Measures” in this Management’s Discussion and Analysis.
Actual generation includes 99 GWh (2022: 70 GWh) from facilities that do not have a corresponding long-term average. See PART 9 – Presentation to Stakeholders’ for why we do not consider
long-term average for certain of our facilities.
For the three months ended December 31, 2023, Funds From Operations were $255 million versus $225 million in the prior year. Funds From Operations
increased $30 million primarily due to contributions from growth, strong asset availability, and favorable hydroelectric generation, particularly at our assets in the
Brazil and Colombia.
Page 37
RECONCILIATION OF NON-IFRS MEASURES
The following table reconciles the non-IFRS financial measures to the most directly comparable IFRS measures. Net income (loss) is reconciled to Adjusted
EBITDA for the three months ended December 31, 2023:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility
-scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Net income (loss) ..................................................................................................................................................... $
34
$
1
$
32
$
142
$ 190 $
(100) $
44
$
(79) $
264
Add back or deduct the following: ...........................................................................................................................
Depreciation ..........................................................................................................................................................
Deferred income tax expense (recovery) ..............................................................................................................
Foreign exchange and financial instrument loss (gain) ........................................................................................
Other(1)
..................................................................................................................................................................
Management service costs ....................................................................................................................................
Interest expense .....................................................................................................................................................
Current income tax expense ..................................................................................................................................
Amount attributable to equity accounted investments and non-controlling interests(2)
........................................
Adjusted EBITDA ....................................................................................................................................................
110
(36)
(55)
10
—
77
—
(19)
121
26
5
(1)
3
—
11
2
(7)
40
34
(2)
1
5
—
97
16
(142)
41
215
(39)
(50)
98
(31)
38
(147)
(158)
—
85
7
—
96
6
(82)
(118)
131
121
28
(41)
35
90
—
27
—
3
42
6
—
(57)
(17)
—
19
—
33
28
—
(7)
19
(9)
50
49
8
(25)
6
517
(151)
(70)
(223)
50
461
39
(357)
530
(1)
(2)
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue earning activities and are not normal, recurring cash
operating expenses necessary for business operations. Refer to Note 7 - Other Income in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated
Financial Statements for more details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized disposition gains and
losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted
for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries.
By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
Page 38
The following table reconciles the non-IFRS financial measures to the most directly comparable IFRS measures. Net income (loss) is reconciled to Adjusted
EBITDA for the three months ended December 31, 2022:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility-
scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Net income (loss) ...................................................................................................................................................... $
38
$ 27
$
96
$
31
$
(90) $
24
$
13
$
(79) $
60
Add back or deduct the following: ............................................................................................................................
Depreciation ...........................................................................................................................................................
Deferred income tax expense (recovery) ...............................................................................................................
Foreign exchange and financial instrument loss (gain) .........................................................................................
Other(1)
...................................................................................................................................................................
Management service costs .....................................................................................................................................
Interest expense .....................................................................................................................................................
Current income tax expense (recovery) .................................................................................................................
Amount attributable to equity accounted investments and non-controlling interests(2)
.........................................
105
(37)
23
(18)
17
—
8
—
82
5
—
12
1
—
24
3
(34)
44
—
72
30
135
(6)
(14)
39
—
66
8
88
(26)
70
7
—
62
2
27
(6)
(31)
62
—
22
—
5
—
(8)
(2)
—
3
1
(83)
(9)
(177)
(135)
(59)
(50)
(10)
1
(24)
408
(114)
14
5
44
32
—
—
14
168
44
351
42
(523)
Adjusted EBITDA ..................................................................................................................................................... $
131
$ 40
$
58
$
124
$
54
$
48
$
2
$
(7) $
450
(1)
(2)
Other corresponds to amounts that are not related to the revenue earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 9 - Other
in the Audited Consolidated Financial Statements for more details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and
realized disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the adjusted EBITDA to Brookfield Renewable that are generated by its investments in associates and joint ventures accounted
for using the equity method. Amounts attributable to non-controlling interest are calculated based on the economic ownership interest held by non-controlling interests in consolidated subsidiaries.
By adjusting Adjusted EBITDA attributable to non-controlling interest, our partnership is able to remove the portion of Adjusted EBITDA earned at non-wholly owned subsidiaries that are not
attributable to our partnership.
Page 39
The following table reconciles the non-IFRS financial metrics to the most directly comparable IFRS measures.
Net income is reconciled to Funds From Operations for the three months ended December 31:
(MILLIONS)
Net income ........................................................................................................................ $
Add back or deduct the following: ....................................................................................
Depreciation ...................................................................................................................
Deferred income (recovery) ............................................................................................
Foreign exchange and financial instruments (gain) loss ................................................
Other(1)
............................................................................................................................
Amount attributable to equity accounted investments and non-controlling interest(2)
Funds from Operations ...................................................................................................... $
......
2023
264 $
517
(151)
(70)
(223)
(82)
255 $
2022
60
408
(114)
14
179
(322)
225
(1)
(2)
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue
earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 7 - Other Income
in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated Financial Statements for more
details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized
disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Amount attributable to equity accounted investments corresponds to the Funds From Operations that are generated by its investments in
associates and joint ventures accounted for using the equity method. Amounts attributable to non-controlling interest are calculated based on
the economic ownership interest held by non-controlling interests in consolidated subsidiaries. By adjusting Funds From Operations
attributable to non-controlling interest, our partnership is able to remove the portion of Funds From Operations earned at non-wholly owned
subsidiaries that are not attributable to our partnership.
The following table reconciles the per Unit non-IFRS financial measures to the most directly comparable IFRS
measures. Basic earnings per LP unit is reconciled to Funds From Operations per Unit, for the three months ended
December 31:
..................................................................................................... $
Basic loss per LP unit(1)
Depreciation ......................................................................................................................
Foreign exchange and financial instruments (gain) loss ...................................................
Deferred income tax recovery ...........................................................................................
Other(2)
...............................................................................................................................
Funds From Operations per Unit(3)
.................................................................................... $
2023
0.01 $
0.41
(0.01)
(0.12)
0.09
0.38 $
2022
(0.16)
0.34
0.08
(0.12)
0.21
0.35
(1)
(2)
(3)
Average LP units outstanding for the three months ended December 31, 2023 were 287.6 million (2022: 275.3 million).
Other corresponds to certain non-recurring other income items as well as certain non-recurring amounts that are not related to the revenue
earning activities and are not normal, recurring cash operating expenses necessary for business operations. Refer to Note 7 - Other Income
in the Audited Consolidated Financial Statements. Also refer to Note 9 - Other in the Audited Consolidated Financial Statements for more
details on the other balance, which includes the company’s economic share of certain non-cash items, foreign currency hedges and realized
disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term.
Average Units for the three months ended December 31, 2023 were 665.7 million (2022: 646.0 million), being inclusive of LP units,
Redeemable/Exchangeable partnership units, BEPC exchangeable shares and GP interest.
Page 40
PART 7 – BUSINESS RISKS AND RISK MANAGEMENT
RISK MANAGEMENT AND FINANCIAL INSTRUMENTS
Management’s objectives are to protect Brookfield Renewable against material economic exposures and
variability of results from various financial risks that include electricity price risk, foreign currency risk, interest rate
risk, credit risk, and liquidity risk. These risks are further discussed in Note 5 – Risk management and financial
instruments in the audited annual consolidated financial statements.
The following table outlines Brookfield Renewable’s financial risks and how they are managed:
Financial Risk
Electricity price
Description of Risk
We have exposure to movements in the
market price of electricity.
Management of Risk
'- Enter into long-term contracts that specify the
price at which electricity is sold
- Maintain a portfolio of short, medium, and
long-term financial contracts to mitigate our
exposure to fluctuations in electricity prices
- Ensure limits and controls are in place for
trading activities
Foreign currency
We are exposed to foreign currency risk –
including Canadian dollar, Brazilian real,
Euro, British pound sterling, Colombian
peso, Indian rupee, and Chinese yuan –
related to operations, anticipated
transactions, and certain foreign currency
debt.
contracts,
excluding Brazil
- As of December 31, 2023, we had, on a
proportionate basis, approximately 88% of 2024
generation (2022: 92% of 2023 generation)
contracted under power purchase agreements and
financial
and
Colombia. In Brazil and Colombia, on a
proportionate basis, we had approximately 93%
and 70% of 2024 (2022: 90% and 67%, of 2023,
respectively) generation under power purchase
agreements, respectively. See “Part 4 – Financial
Performance
Proportionate
Information”
'- Enter into foreign currency contracts designed
to minimize the exposure to foreign currency
fluctuations
Review
on
- 30% of cash flow is generated in the United
States while Canadian Dollar and Euro exposure,
representing 40% of our portfolio, is proactively
managed through foreign currency contracts
- Limited foreign currency contracts to hedge our
exposure to currencies in South America and
Asia – representing 30% of our portfolio – due to
the high costs associated with hedging certain
currencies. However, these specific exposures
are mitigated by the annual inflation-linked
escalations in our power purchase agreements
Page 41
Financial Risk
Interest rate
Description of Risk
We are exposed to interest rate risk on the
interest rates of our variable-rate debt, and
on dividend and distribution rate resets on
our Class A Preference Shares and
Preferred Units, respectively.
Management of Risk
'- Assets largely consist of long duration physical
assets, and financial liabilities consist primarily
of long-term fixed-rate debt or floating-rate debt
that has been swapped to fixed rates with interest
rate financial
the
exposure to interest rate fluctuations
to minimize
instruments
- Enter into interest rate contracts to lock-in
fixed rates on certain anticipated future debt
issuances and on floating rate debts
- Our proportionate floating rate exposure
represents 8% of our total debt, after affecting
for variable-rate debt that has been hedged
through the use of interest rate swaps. Our
floating rate exposure arises primarily from our
South American operations, as we have limited
opportunities to raise fixed-rate debt or hedge
due to the high associated costs
Page 42
Financial Risk
Credit
Liquidity
Description of Risk
We are exposed to credit risk from
operating activities and certain financing
activities, the maximum exposure of which
is represented by the carrying amounts
reported in the statements of financial
position. We are exposed to credit risk if
counterparties to our energy contracts,
interest rate swaps, forward foreign
exchange contracts and physical electricity
and gas transactions as well as trade
receivables are unable to meet their
obligations.
We are exposed to liquidity risk for
financial liabilities.
We are also subject to internal liquidity risk
because we conduct our business activities
through separate legal entities (subsidiaries
and affiliates) and are dependent on receipts
of cash from those entities to defray
corporate expenses and to make dividend
and distribution payments to shareholders
and Unitholders, respectively. Under the
credit agreements for subsidiary debt, it is
conventional for distributions of cash to
Brookfield Renewable to be prohibited if
the loan is in default (notably for non-
payment of principal or interest) or if the
entity fails to achieve a benchmark debt-
service coverage ratio. Refer to Note 18 –
Capital management of the annual
consolidated financial statement for further
disclosures.
Management of Risk
'- Diverse counterparty base with long-standing
credit histories
- Exposure to counterparties with investment-
grade credit ratings
- Use of standard trading contracts and other
standard credit risk mitigation techniques
- As at December 31, 2023, 86% (2022: 89%) of
Brookfield Renewable’s trade receivables were
current
'- As at December 31, 2023, available liquidity
was $4.1 billion. Liquidity is comprised of our
share of cash and cash equivalents, investments
in marketable securities, the available portion of
the corporate credit facilities, and our share of
subsidiary credit
the
available liquidity and debt maturity ladder are
included in “Part 5 – Liquidity and Capital
Resources”
facilities. Details of
- Effective and regular monitoring of debt
covenants and cooperation with lenders to cure
any defaults
- Target investment grade debt or debt with
investment grade characteristics with the ability
to absorb volatility in cash flows
- Long-term duration of debt instruments and the
diversification
in maturity dates over an
extended period of time
- Sufficient cash from operating activities, access
to undrawn credit facilities, and possible capital
markets financing to fund our operations and
fulfill our obligations as they become due
- Ensure access to public capital markets and
maintain a strong investment grade credit rating
Page 43
RISK FACTORS
The following represents the most relevant risk factors relating to Brookfield Renewable's business, and is not
all-inclusive. For a description of other possible risks please see the Form 20-F which can be accessed on EDGAR
and SEDAR.
Risks Relating to Our Operations and Our Industry
Changes to resource availability, as a result of climate change or otherwise, at any of our renewable power
facilities could adversely affect the amount of electricity that we are able to generate.
The revenues generated by our renewable power facilities are correlated to the amount of electricity produced,
which is in turn dependent upon available water flows and upon wind, irradiance and weather conditions generally.
Hydrology, wind, irradiance and weather conditions have natural variations from season to season and from year to
year and may also change permanently because of climate change or other factors.
If one or more of our generation facilities were to be subject in the future to flooding, extreme weather
conditions (including severe wind storms and droughts), fires, natural disasters, or if unexpected geological or other
adverse physical conditions were to develop at any of our generation facilities, the generation capacity of that
facility could be significantly reduced or eliminated. For example, our hydroelectric facilities depend on the
availability of water flows within the watersheds in which we operate and could be materially impacted by changes
to hydrology patterns, such as droughts. In the event of severe flooding, our hydrology facilities may be damaged.
Wind energy and solar energy are highly dependent on weather conditions and, in particular, on wind conditions and
irradiance, respectively. The profitability of a wind farm depends not only on observed wind conditions at the site,
which are inherently variable, but also on whether observed wind conditions are consistent with assumptions made
during the project development phase or when a given project was acquired. Similarly, projections of solar resources
depend on assumptions about weather patterns, shading and irradiance, which are inherently variable and may not be
consistent with actual conditions at the site. A sustained decline in water flow at our hydroelectric facilities, in wind
conditions at our wind energy facilities or of irradiance at our solar facilities could lead to an adverse change in the
volume of electricity generated, and to revenues and cash flow.
Climate change may increase the frequency and severity of severe weather conditions and may change existing
weather patterns in ways that are difficult to anticipate, which could result in more frequent and severe disruptions to
our generation facilities (including as a result of extreme flooding that may be above the normal design parameters
of our hydroelectric facilities) and the power markets in which we operate. In addition, customers’ energy needs
generally vary with weather conditions, primarily temperature and humidity. To the extent weather conditions are
affected by climate change, customers’ energy use could increase or decrease depending on the duration and
magnitude of changing weather conditions, which could adversely affect our business, results of operations and cash
flows.
Supply and demand in energy markets are volatile and such volatility could have an adverse impact on electricity
prices and an adverse effect on Brookfield Renewable’s assets, liabilities, business, financial condition, results of
operations and cash flow.
A portion of our revenues are tied, either directly or indirectly, to the wholesale market price for electricity in
the energy markets in which we operate. Wholesale market electricity prices are impacted by a number of factors
including: the management of generation and the amount of excess generating capacity relative to load in a
particular market; the cost of controlling emissions of carbon dioxide and other pollutants; the structure of the
electricity market; weather conditions (such as extremely hot or cold weather) that impact electrical load; the price
of fuel (such as natural gas) that is used to generate electricity; and political instability (such as the conflict between
Ukraine and Russia and the disruptive impact that related sanctions and other related events might have on European
energy markets).
In the long term, there is uncertainty surrounding the trend in electricity demand growth, which is influenced by
macroeconomic conditions, absolute and relative energy prices, energy conservation and demand-side management.
Correspondingly, from a supply perspective, there are uncertainties associated with long term plans for the
construction of baseload generation capacity, the timing of generating plant retirements (e.g., coal) and with the
scale, pace and structure of replacement capacity, again reflecting a complex interaction of economic and political
Page 44
pressures and environmental preferences. This volatility and uncertainty in power markets generally, including non-
renewable power markets, could have an adverse effect on Brookfield Renewable’s assets, liabilities, business,
financial condition, results of operations and cash flow.
As our contracts expire, we may not be able to replace them with agreements on similar terms.
Certain long-term contracts in our portfolio will be subject to re-contracting in the future. For example, with
respect to PPAs in our renewable power portfolio, if the price of electricity in power markets is declining at the time
of such re-contracting, it may impact our ability to re-negotiate or replace these contracts on terms that are
acceptable to us, or at all. In addition, a concentrated pool of potential buyers for electricity generated by our
renewable energy facilities in certain jurisdictions may restrict our ability to negotiate favorable terms under new
PPAs or existing PPAs that are subject to re-contracting. We cannot provide any assurance that we will be able to re-
negotiate or replace these contracts once they expire, and even if we are able to do so, we cannot provide any
assurance that we will be able to obtain the same prices or terms we currently receive. If we are unable to re-
negotiate or replace these contracts, or unable to secure prices at least equal to the current prices we receive, our
business, financial condition, results of operation and prospects could be adversely affected. Conversely, what may
appear to be an attractive price at the time of recontracting could, if prices significantly rise over the contract’s term,
result in us having committed to sell power or other goods or services in the future at below then-market rates.
There is a risk that our concessions and licenses will not be renewed or that, where concessions are required to
build out our development pipeline, they may not be granted or awarded.
We hold concessions and licenses and we have rights to operate our facilities (including, for example, in respect
of our hydroelectric projects, rights to the land and water required for power generation), and which are subject to
renewal at the end of their terms. We generally expect that our concessions and licenses will be renewed. However,
if we are not granted renewal rights, or if our concessions and licenses are renewed subject to conditions which
impose additional costs, or impose additional restrictions (including, for example, setting a price ceiling for energy
sales), our profitability and operational activity could be adversely impacted. In addition, concessions may be
required to advance projects in our development pipeline. There can be no assurance that we will be granted any
concession that we require with respect to any given project or on what timelines or conditions.
The amount of uncontracted generation in our renewable power portfolio may increase and the contract profile
for future renewable power projects may change.
In 2023 approximately 90% of our renewable power generation (on a proportionate basis) was contracted in
each of those calendar years under long-term, fixed price contracts with creditworthy counterparties. The average
life of our contracts is 13 years on a proportionate basis, reducing the impact of negative short term price
fluctuations in the power market. The portion of our renewable power portfolio that is uncontracted may increase
gradually over time. We may sell electricity from our uncontracted generation into the spot-market or other
competitive power markets from time to time. With respect to such transactions, we are not guaranteed any rate of
return on our capital investments through mandated rates, and revenues and results of operations are likely to
depend, in large part, upon prevailing market prices. These market prices are driven by factors outside of our control
and may fluctuate substantially over relatively short periods of time. Additionally, future renewable power projects
may be contracted with different types of counterparties (including commercial and industrial users) and using
different contract structures compared to our historical projects. Such increased uncontracted generation and
changing contract profiles could have an adverse effect on our business, financial condition, results of operations
and cash flows.
Our ability to deliver electricity to our various counterparties and buildout our renewable power development
pipeline requires the availability of (and access to) interconnection facilities and transmission systems.
Our ability to sell electricity is impacted by the availability of, and access to, the various transmission systems
to deliver power to a contractual delivery point and the arrangements and facilities necessary to connect renewable
generation projects to the transmission systems. The absence of this availability and access, our inability to obtain
reasonable terms and conditions for interconnection and transmission agreements, the operational failure or
decommissioning of existing interconnection facilities or transmission facilities, the lack of adequate capacity on
such interconnection or transmission facilities, curtailment as a result of transmission facility downtime, or the
failure of any relevant jurisdiction to expand transmission facilities, may have an adverse effect on our ability to
Page 45
deliver electricity to our various counterparties or the requirement of counterparties to accept and pay for energy
delivery. Insufficient access to transmission and interconnection systems may also constrain our ability to develop
new utility-scale projects, which require transmission systems to have available interconnection points and the
overall capacity necessary to transmit the energy expected to be generated by a development project once it achieves
commercial operation. Lack of access to transmission systems could accordingly adversely affect our assets,
liabilities, business, financial condition, results of operations and cash flow.
The occurrence of dam failures could result in a loss of generating capacity and damage to the environment,
third parties or the public, which could require us to expend significant amounts of capital and other resources
and expose us to significant liability.
The occurrence of dam failures at any of our hydroelectric generating stations or the occurrence of dam failures
at other generating stations or dams operated by third parties whether upstream or downstream of our hydroelectric
generating stations could result in a loss of generating capacity until the failure has been repaired. If the failure is at
one of our facilities, repairing such failure could require us to expend significant amounts of capital and other
resources. As noted above, severe failures could also result in harm to third parties or the environment, either of
which could expose us to significant liability. A dam failure at a generating station or dam operated by a third party
that is upstream of one of our facilities could result in a loss of revenue due to short term disruption to expected
water flows. Even if the failure is not at an upstream facility, it could result in new and potentially onerous
regulations that could impact Brookfield Renewable’s facilities. Any such new regulations could require material
capital expenditures to maintain compliance and our financial position could be adversely affected.
Energy marketing risks may have an adverse effect on our business.
Our energy marketing business involves the establishment of positions in the wholesale and retail energy
markets. To the extent that we enter into forward purchase contracts or take long positions in the energy markets, a
downturn in market prices could result in losses from a decline in the value of such long positions. Conversely, to
the extent that we enter into forward sales contracts or take short positions in the energy markets, an upturn in
market prices could expose us to losses as we attempt to cover any short positions by acquiring energy in a rising
market.
Our energy marketing strategies also depend on counterparties fulfilling their obligations to us and on the
quality of the collateral that they post. Our positions can be impacted by volatility in the energy markets that, in turn,
depend on various factors, including weather in various geographical areas and short-term supply and demand
imbalances, which cannot be predicted with any certainty. A shift in the energy markets could adversely affect our
positions which could also have an adverse effect on our business.
Although we employ a number of risk management controls in order to limit exposure to risks arising from
trading activities, we cannot guarantee that losses will not occur and such losses may be outside the parameters of
our risk controls.
There are general industry risks associated with the power markets in which we operate.
We currently operate in power markets in North America, South America, Europe and Asia, each of which is
affected by competition, price, supply of and demand for power, the location of import/export transmission lines and
overall political, economic and social conditions and policies. Our renewable power operations are also largely
concentrated in a relatively small number of countries, and accordingly are exposed to country-specific risks (such
as weather conditions, local economic conditions or political/regulatory environments) that could disproportionately
affect us. A general and extended decline in the North American, South American, European or Asian economies, or
in the economies of the specific countries in which we operate, or sustained conservation efforts to reduce electricity
consumption, could have the effect of reducing demand for electricity and could thereby have an adverse effect on
our business, financial condition, results of operations and cash flows.
Our operations are exposed to health, safety, security and environmental risks.
The ownership, construction and operation of our assets carry an inherent risk of liability related to health,
safety, security and the environment, including the risk of government imposed orders to remedy unsafe conditions
and/or to remediate or otherwise address environmental contamination or damage. We could also be exposed to
potential penalties for contravention of health, safety, security and environmental laws and potential civil liability. In
Page 46
the ordinary course of business we incur capital and operating expenditures to comply with health, safety, security
and environmental laws, to obtain and comply with licenses, permits and other approvals and to assess and manage
related risks. The cost of compliance with these laws (and any future laws or amendments enacted) may increase
over time and result in additional material expenditures. We may become subject to government orders,
investigations, inquiries or other proceedings (including civil claims) relating to health, safety, security and
environmental matters as a result of which our operations may be limited or suspended. The occurrence of any of
these events or any changes, additions to or more rigorous enforcement of health, safety, security and environmental
laws could have an adverse impact on operations and result in additional material expenditures. Additional
environmental, health and safety issues relating to presently known or unknown matters may require unanticipated
expenditures, or result in fines, penalties or other consequences (including changes to operations) that may be
adverse to our business and results of operations.
Counterparties to our contracts may not fulfill their obligations.
In the course of our business, we enter into a wide range of contracts including but not limited to PPAs,
engineering, procurement and construction contracts, long term service agreements, supply agreements, contracts to
purchase equipment and joint venture agreements. If our counterparties do not perform as expected under these
contracts, it may have an adverse impact on our business and results of operations. For example, if purchasers of
power under our PPAs are unable or unwilling to fulfill their contractual obligations under the relevant PPA or if
they refuse to accept delivery of power pursuant to the relevant PPA, our assets, liabilities, business, financial
condition, results of operations and cash flow could be adversely affected as we may not be able to replace the
agreement with an agreement on equivalent terms and conditions. Similarly, external events, such as a severe
economic downturn, could impair the ability of some counterparties to the PPAs or some customers to pay for
electricity received.
We rely on computerized business systems, which could expose us to cyber-attacks.
Our business relies on information technology. In addition, our business relies upon telecommunication services
to remotely monitor and control our assets and interface with regulatory agencies, wholesale power markets and
customers. The information and embedded systems of key business partners, third-party service providers (including
suppliers of the information technology systems on which we rely), and regulatory agencies are also important to our
operations. In light of this, our computer systems may face ongoing cybersecurity threats and attacks, which could
result in the failure of such systems, and we may be subject to cyber-terrorism or other cybersecurity risks or other
breaches of information technology system security intended to obtain unauthorized access to our proprietary
information, personally identifiable information or to client or third-party data stored on our systems, destroy or
disable our data and/or that of our business partners, disclose confidential data in breach of data privacy legislation,
destroy data or disable, degrade, or sabotage these systems through the introduction of computer viruses, cyber-
attacks and other means. Such attacks could originate from a wide variety of sources including internal or unknown
third parties.
The sophistication of the threats continue to evolve and grow, including the risk associated with the use of
emerging technologies, such as artificial intelligence and quantum computing, for nefarious purposes. We cannot
predict what effects such cyber-attacks or compromises or shut-downs may have on our business and on the privacy
of the individuals or entities affected, and the consequences could be material. A significant actual or potential theft,
loss, corruption, exposure, fraudulent, unauthorized or accidental use or misuse of investor, employee or other
personally identifiable or proprietary business data, whether by third parties or as a result of employee malfeasance
or otherwise, non-compliance with our contractual or other legal obligations regarding such data or intellectual
property or a violation of our privacy and security policies with respect to such data could result in significant
remediation and other costs, fines, litigation and regulatory actions against us by governments, various regulatory
organizations or exchanges, or affected individuals, in addition to significant reputational harm and/or financial loss,
and it may not be possible to recover losses suffered from such incidents under our insurance policies.
A breach of our cybersecurity measures, or those of third-party service providers, or the failure or malfunction
of any of our computerized business systems, associated backup or data storage systems could cause us to suffer a
disruption in one or more parts of our business and experience, among other things, financial loss, reputational
damage, a loss of business opportunities, the unplanned shutdown of our operating facilities, misappropriation or
unauthorized release of confidential or personal information, damage to our technology systems and those with
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whom we do business, violation of privacy and other laws, litigation, regulatory penalties and remediation and
restoration costs as well as increased costs to maintain our systems. Cybersecurity breaches or failures of our
information technology systems could have an adverse effect on our business operations, financial reporting,
financial condition and results of operations, and result in reputational damage. Although we are continuing to
enhance defenses to such attacks, we can provide no assurance that our efforts or those of third-party service
providers will be successful in preventing or ameliorating damage from such an attack on us and, as the manner in
which cyber-attacks are undertaken has become more sophisticated, there is a risk that the occurrence of cyber-
attack may remain undetected for an extended period.
We are reliant on third-party service providers for certain aspects of our business, including for certain
information systems and technology platforms, legal services, technology, administration, tax, accounting and
compliance matters. A disaster, disruption or compromise in technology or infrastructure that supports our
businesses, including a disruption involving electronic communications or other services used by us, our vendors or
third parties with whom we conduct business, may have an adverse impact on our ability to continue to operate our
businesses without interruption which could have a material adverse effect on us. In addition to the fact that these
third-party service providers could also face ongoing cybersecurity threats and compromises of their systems, we
generally have less control over the delivery of such third-party services, and as a result, we may face disruptions to
our ability to operate a business as a result of interruptions of such services. A prolonged global failure of cloud
services provided by a variety of cloud services providers that we engage could result in cascading systems failures
for us.
Data protection and privacy rules have become a focus for regulators globally. For instance, the European
General Data Protection Regulation (“GDPR”) sets out data protection rules for individuals that are residents of the
E.U. GDPR imposes stringent rules and penalties for non-compliance, as does similar legislation in certain U.S.
states and Canadian provinces in which we operate and in Brazil, which could have an adverse effect on our
business.
Risks Relating to Financing
Our ability to finance our operations and fund growth initiatives is subject to various risks relating to the state of
capital markets and to our ability to complete all or some of our capital recycling initiatives.
We expect to finance future acquisitions, the development and construction of new facilities and other capital
expenditures out of cash generated from our operations, capital recycling, debt and possible future issuances of
equity. Disruptions and volatility in capital markets, including those caused by rising interest rates, which continued
to increase in 2023, could increase the Partnership’s cost of capital and adversely affect its ability to fund its
liquidity and capital needs and fund the growth of the business.
There is debt throughout our corporate structure that will need to be replaced from time to time. For example,
BEP, BRELP and LATAM Holdco, NA Holdco, Euro Holdco and Investco and any other direct wholly-owned
subsidiary of BRELP created or acquired after the date of the Amended and Restated Limited Partnership
Agreement of BREL (collectively, “Holding Entities”) have corporate debt, certain of our subsidiaries of the
Holding Entities (“Operating Entities”) have limited recourse project level debt and certain of our portfolio
companies, like Isagen, have holding company level debt. Our ability to obtain debt or equity financing to fund our
growth, and our ability to refinance existing corporate and non-recourse indebtedness on favourable terms, if at all,
is dependent on, among other factors, the level of future interest rates, the overall state of capital markets (as well as
local market conditions, particularly in the case of non-recourse financings), continued operating performance of our
assets, future electricity market prices, lenders’ and investors’ assessment of our credit risk and investor appetite for
investments in renewable energy and infrastructure assets in general and in Brookfield Renewable’s securities in
particular. Also, certain Brookfield Renewable financing agreements contain conditions that limit our ability to
repay indebtedness prior to maturity without incurring penalties, which may limit our ability to refinance
indebtedness or raise new capital on favorable terms. To the extent that external sources of capital become limited or
unavailable or available on onerous terms (including requirements for Brookfield Renewable to provide credit
support such as letters of credit or parent guarantees), our ability to fund acquisitions and make necessary capital
investments to construct new or maintain existing facilities may be impaired, and as a result, our business, financial
condition, results of operations and prospects may be adversely affected.
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We seek to recycle capital to fund acquisitions and the development and construction of new projects by selling
certain assets or an interest in certain assets, including our portfolio companies. However, we may not be able to
complete all or some of our capital recycling initiatives on our desired timelines, at favorable prices or at all. For
example, adverse market conditions or other factors beyond our control might mean that we are unable to complete
an asset sale at a price that is aligned with our business plan resulting in a decision to transact at a lower price or to
abandon the sales process altogether. Increases in interest rates could also make it more difficult to locate and
consummate investments because other potential buyers, including operating companies acting as strategic buyers,
may be able to bid for an asset at a higher price due to a lower overall cost of capital or their ability to benefit from a
higher amount of cost savings following the acquisition of the asset. If our capital recycling initiatives do not
proceed as planned this could reduce the liquidity available to fund future growth, which could in turn limit our
ability to grow our distributions in line with our stated goals and the market value of our Units could decline.
We are subject to operating and financial restrictions through covenants in our loan, debt and security
agreements.
Brookfield Renewable and its subsidiaries are subject to operating and financial restrictions through covenants
in our loan, debt and security agreements. These restrictions prohibit or limit our ability to, among other things,
incur additional debt, provide guarantees for indebtedness, grant liens, dispose of assets, liquidate, dissolve,
amalgamate, consolidate or effect corporate or capital reorganizations, declare distributions, issue equity interests
and create subsidiaries. A financial covenant in our corporate bonds and in our corporate bank credit facilities limits
our overall indebtedness to a percentage of total capitalization, a restriction which may limit our ability to obtain
additional financing, withstand downturns in our business and take advantage of business and development
opportunities. If we breach our covenants, our credit facilities may be terminated or come due and such event may
cause our credit rating to deteriorate and subject Brookfield Renewable to higher interest and financing costs. From
time to time, we also acquire businesses and assets that have debt obligations that are in default. We may also be
required to seek additional debt financing on terms that include more restrictive covenants and/or higher interest
rates, change of control restrictions, require repayment on an accelerated schedule or impose other obligations that
limit our ability to grow our business, acquire needed assets, exit investments in assets or portfolio companies, or
take other actions that we might otherwise consider appropriate or desirable.
Changes in our credit ratings may have an adverse effect on our financial position and ability to raise capital.
We cannot assure you that any credit rating assigned to Brookfield Renewable or any of its portfolio companies,
operating subsidiaries or other subsidiaries or their debt securities will remain in effect for any given period of time
or that any rating will not be lowered or withdrawn entirely by the relevant rating agency. A lowering or withdrawal
of such ratings may have an adverse effect on our financial position and ability to raise capital.
Risks Relating to Our Growth Strategy
We may be unable to identify sufficient investment opportunities and complete transactions, as planned.
Our strategy for building value for our Unitholders is to seek to acquire or develop high-quality assets and
businesses that generate sustainable and increasing cash flows, with the objective of achieving appropriate risk-
adjusted returns on our invested capital over the long-term. However, there is no certainty that we will be able to
find sufficient investment opportunities and complete transactions that meet our investment criteria. Our investment
criteria consider, among other things, the financial, operating, governance and strategic merits of a proposed
acquisition including whether we expect it will meet our targeted return hurdle and, as such, there is no certainty that
we will be able to continue growing our business by making acquisitions or developing assets at attractive returns.
Competition for assets is significant and competition from other well-capitalized investors or companies may
significantly increase the purchase price or prevent us from completing an acquisition. We may also decline
opportunities that we do not believe meet our investment criteria, which our competition may pursue instead.
Our growth initiatives may be subject to a number of closing conditions, including, as applicable, third-party
consents, regulatory approvals (including from competition authorities) and other third-party approvals or actions
that are beyond our control. In particular, many jurisdictions in which we seek to invest impose government consent
requirements on investments by foreign persons. Consents and approvals may not be obtained, may be obtained
subject to conditions which adversely affect anticipated returns, and/or may be delayed and delay or ultimately
preclude the completion of acquisitions, dispositions and other transactions. Government policies and attitudes in
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relation to foreign investment may change, making it more difficult to complete acquisitions, dispositions and other
transactions in such jurisdictions. Furthermore, interested stakeholders could take legal steps to prevent transactions
from being completed. We may also be unable to secure financing on acceptable terms (or at all) for our proposed
acquisitions.
If all or some of our acquisitions and other transactions are unable to be completed on the terms agreed, we
may need to modify or delay or, in some cases, abandon these transactions altogether (which may result in the
payment of significant break-up fees). If we are unable to achieve the expected benefits of transactions, the market
value of our Units may decline.
Political instability, changes in government policy, or unfamiliar cultural factors could adversely impact the
value of our investments.
We are subject to the risk of geopolitical uncertainties in certain jurisdictions in which we operate. We make
investments in businesses globally and we can pursue investments in new, non-core markets, which may expose us
to additional risks. We may not properly adjust to the local culture and business practices in such markets, and there
is the prospect that we may hire personnel or partner with local persons who might not comply with our culture and
ethical business practices; either scenario could result in the failure of our initiatives in new markets and lead to
financial losses for us and our managed entities. There are risks of political instability in several of the jurisdictions
in which we conduct business, including, for example, from factors such as political conflict, tariffs and other
protectionist trade policies, including the encouragement of the onshoring of manufacturing in the U.S. and other
countries, income inequality, refugee migration, terrorism, the potential break-up of countries or political-economic
unions, and political corruption. For example, the conflicts in Eastern Europe and the Middle East and the global
response to each, including the imposition of economic and other sanctions, has significantly impacted the global
economy and financial markets, resulted in volatility in fuel prices, amplified existing supply chain challenges
caused by increases in shipping costs (including as a result of conflicts and other attacks in or near shipping
channels) and heightened cybersecurity disruptions and threats.
While recent energy market volatility in Europe has not directly adversely impacted Brookfield Renewable’s
business (principally because our power generation facilities in Europe rely on renewable inputs like wind and
sunshine rather than inputs with volatile prices like gas and coal) the rising cost of power has generally increased the
costs of conducting business in Europe and caused economic hardship and uncertainty and political tensions in the
countries in which we operate. Further economic and political instability and the escalation or expansion of armed
conflict in Eastern Europe, the Middle East, or elsewhere in the world, could result in local, regional and/or global
instability that could adversely impact our business, including through the disruption of free movement of goods,
services and people, or a destabilization of energy markets. The materialization of one or more of these risks could
negatively affect our financial performance.
Our operations in the future may be different from our current business, including through future sustainable
solutions investments.
Our operations today primarily include hydroelectric, wind, utility solar and distributed generation power
generation as well as biomass power generation, cogeneration, storage and nuclear services businesses in North and
South America, Europe and Asia. Our development pipeline includes renewable power generation projects as well
as CCS, RNG and recycling projects. We may acquire interests in other businesses, and we may seek to divest of
certain of our existing operations in the future. In addition, pursuant to the Relationship Agreement with Brookfield,
Brookfield may (but is not required to) offer us the opportunity to acquire: (i) an integrated utility even if a
significant component of such utility’s operations consist of a non-renewable power generation operation or
development, such as a power generation operation that uses coal or natural gas, (ii) a portfolio of power operations,
even if a significant component of such portfolio’s operations consist of non-renewable power generation, or (iii)
renewable power generation operations or developments that comprise part of a broader enterprise.
The completion of new acquisitions can have the effect of significantly increasing the scale and scope of our
operations, including operations in new geographic areas and industry sectors, and the Service Provider may
have difficulty managing these additional operations. In addition, acquisitions involve risks to our business.
A key part of our strategy will involve seeking acquisition opportunities upon Brookfield’s recommendation
and allocation of opportunities to us. Acquisitions may increase the scale, scope and diversity of our operating
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businesses. We depend on the diligence and skill of Brookfield’s and our professionals to effectively manage
Brookfield Renewable, integrating acquired businesses with our existing operations. These individuals may have
difficulty managing additional acquired businesses and may have other responsibilities within Brookfield’s asset
management business. If any such acquired businesses are not effectively integrated and managed, our existing
business, financial condition and results of operations may be adversely affected.
Future acquisitions will likely involve some or all of the following risks, which could materially and adversely
affect our business, financial condition or results of operations: the difficulty of integrating the acquired operations
and personnel into our current operations; potential disruption of our current operations; diversion of resources,
including Brookfield’s time and attention; the difficulty of managing the growth of a larger organization; the risk of
entering markets in which we have little experience; the risk of becoming involved in labor, commercial or
regulatory disputes or litigation related to the new enterprise; risk of environmental or other liabilities associated
with the acquired business; and the risk of a change of control resulting from an acquisition triggering rights of third
parties or government agencies under contracts with, or authorizations held by the operating business being
acquired. While it is our practice to conduct extensive due diligence investigations into businesses being acquired, it
is possible that due diligence may fail to uncover all material risks in the business being acquired, or to identify a
change of control trigger in a material contract or authorization, or that a contractual counterparty or government
agency may take a different view on the interpretation of such a provision to that taken by Brookfield Renewable,
thereby resulting in a dispute. The discovery of any material liabilities subsequent to an acquisition, as well as the
failure of an acquisition to perform according to expectations, could have an adverse effect on our business,
financial condition and results of operations. In addition, if returns are lower than anticipated from new acquisitions,
we may not be able to achieve growth in our distributions in line with our stated goals and the market value of our
securities may decline.
Not all of the projects in our development pipeline will achieve commercial operation.
We have a large development pipeline that includes projects at different levels of advancement, from early stage
projects which may not yet have the permits, licenses or other government approvals that are required, to later stage
projects that we believe have a path to construction readiness, to under-construction projects that are in the process
of being built. Our development pipeline also includes projects that we don’t own 100% of or, in certain
circumstances, control. While the likelihood of a project being built increases when it receives, for example,
required permits, licenses or other government approvals, when it signs construction and equipment supply
agreements, and when it signs an offtake agreement, there can be no assurance that any one or a specific percentage
of the projects in our development pipeline will be built or on what timeline.
With respect to our renewable power assets, our ability to realize our development growth plans is dependent on
our ability to develop existing sites, to repower existing projects that are nearing the end of their useful lives, and to
find new sites suitable for development into viable projects. Our ability to maintain a development permit often
requires specific development steps to be undertaken. Successful development of renewable power projects is
typically dependent on a number of factors, including: the ability to secure or renew our rights to an attractive site on
reasonable terms, often following lengthy negotiations and/or competitive bidding processes; accurately measuring
resource availability at levels deemed economically attractive for continued project development; the ability to
secure new or renewed approvals, licenses and permits; the acceptance of local stakeholders, including in some
cases, Indigenous peoples; the ability to secure transmission interconnection access or agreements; the ability to
successfully integrate new projects or technologies into existing assets; the ability to acquire suitable labor,
equipment and construction services on acceptable terms; the ability to attract construction project financing,
including from tax equity investors and through tax and other government incentives such as those provided in the
U.S. through the Inflation Reduction Act; and the ability to secure a long-term PPA or other sales contract on
reasonable terms. Each of these factors can be critical in determining whether or not a particular development
project might ultimately be suitable for construction and some of these factors are outside of our control. Failure to
achieve any one of these elements may prevent the development and construction of a renewable power project, or
otherwise cause such project to become obligated to make delay or termination payments or become obligated for
other damages under contracts, experience the loss of tax credits or tax incentives, or experience diminished returns.
When this occurs we may lose all of our investment in development expenditures and may ultimately be required to
write-off project development assets and costs, which could adversely impact our ability to achieve our development
growth plans, deliver energy and generate revenues.
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Our ability to develop projects is subject to construction risks and risks associated with the arrangements we
enter into with communities and joint venture partners.
Our ability to develop an economically successful project is dependent on, among other things, our ability to
construct a particular project on-time and on-budget. For example, the construction and development of a renewable
power generating facility, whether as a greenfield project or by way of a repowering of an existing project, is subject
to environmental, engineering and construction risks that could result in cost-overruns, delays and reduced
performance. A number of factors that could cause delays, cost over-runs or reduced performance include, but are
not limited to, changes in local laws or difficulties in obtaining permits, rights of way or approvals, changing
engineering and design requirements, construction costs exceeding estimates for various reasons, including
inaccurate engineering and planning, failures to properly estimate the cost of raw materials, components, equipment,
labor or the inability to timely obtain them, unanticipated problems with project start-up, the performance of
contractors, the insolvency of the head contractor, a major subcontractor and/or a key equipment supplier, labor
disruptions, inclement weather, defects in design, engineering or construction (including, without limitation, latent
defects that do not materialize during an applicable warranty or limitation period) and project modifications. A delay
in the projected completion of a project can result in a material increase in total project construction costs through
higher capitalized interest charges, additional labor and other expenses and a resultant delay in the commencement
of cash flow. In addition, such unexpected issues may result in increased debt service costs, operations and
maintenance expenses and damage payments for late delivery or the failure to meet agreed upon generation levels.
This may result in an inability of the project to meet the higher interest and principal repayments arising from the
additional debt required. Protracted delays could also result in a given project being in default of other terms of any
applicable construction financing arrangements.
Development projects may also require large areas of land on which the new projects are to be constructed and
operated. Rights to use land can be obtained through freehold title, leases and other rights of use. Land title systems
vary by jurisdiction and in some cases it may not be possible to ascertain definitively who has the legal right to enter
into land tenure arrangements with the asset owner or to secure the consent of all land owners. A government, court,
regulator, Indigenous group, landowner or other stakeholder may make a decision or take action that adversely
affects the development of a project or the demand for its services. For example, a regulator may restrict our access
to an asset, or may require us to provide third parties with access. The restriction or curtailment of our rights with
respect to an asset by a regulator or otherwise may negatively impact the success of our projects.
We may enter into various types of arrangements with communities and joint venture partners, including in
some cases, Indigenous peoples, for the development of projects. In some circumstances, we may be required to
notify, consult, or obtain the consent of certain stakeholders, such as Indigenous peoples, landowners and/or
municipalities. In some jurisdictions, it may be possible to claim Indigenous rights to land and the existence or
declaration of Indigenous title may affect the existing or future activities of our projects and impact their business,
financial condition and results of operations. In Canada, for example, courts have recognized that Indigenous
peoples possess constitutionally protected rights in respect of land used or occupied by their ancestors where treaties
have not been concluded to deal with these rights. Certain of these communities and partners may have or may
develop interests or objectives which are different from or even in conflict with our objectives. Any such differences
could have a negative impact on the success of our projects.
Risks Relating to Our Relationship with Brookfield
Brookfield exercises substantial influence over Brookfield Renewable and we are highly dependent on the Service
Provider.
A subsidiary of Brookfield Corporation is the sole shareholder of the Managing General Partner. As a result of
its ownership of the Managing General Partner, Brookfield is able to control the appointment and removal of the
Managing General Partner’s directors and, accordingly, exercise substantial influence over Brookfield Renewable.
In addition, BEP holds its interest in the Operating Entities indirectly through BRELP and will hold any future
acquisitions indirectly through BRELP, the general partner of which is indirectly owned by Brookfield Corporation.
As BEP’s only substantial assets are the limited partnership interests and preferred limited partnership interests that
it holds in BRELP, except for rights under the Voting Agreement, BEP does not have a right to participate directly
in the management or activities of BRELP or the Holding Entities, including with respect to the making of decisions
(although it has the right to remove and replace the BRELP GP LP).
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BEP and BRELP depend on the management and administration services provided by or under the direction of
the Service Provider under our Master Services Agreement. Brookfield personnel and support staff that provide
services to us under our Master Services Agreement are not required to have as their primary responsibility the
management and administration of BEP or BRELP or to act exclusively for either of us and our Master Services
Agreement does not require any specific individuals to be provided by Brookfield to BEP. Failing to effectively
manage our current operations or to implement our strategy could have an adverse effect on our business, financial
condition and results of operations. Our Master Services Agreement continues in perpetuity, until terminated in
accordance with its terms.
The departure of some or all of Brookfield’s professionals could prevent us from achieving our objectives.
We depend on the diligence, skill and business contacts of Brookfield’s professionals and the information and
opportunities they generate during the normal course of their activities. Our future success will depend on the
continued service of these individuals, who are not obligated to remain employed with Brookfield. Brookfield has
experienced departures of key professionals in the past and may do so in the future, and we cannot predict the
impact that any such departures will have on our ability to achieve our objectives. The departure of a significant
number of Brookfield’s professionals for any reason, or the failure to appoint qualified or effective successors in the
event of such departures, could have an adverse effect on our ability to achieve our objectives. The Amended and
Restated Limited Partnership Agreement of BEP and our Master Services Agreement do not require Brookfield to
maintain the employment of any of its professionals or to cause any particular professionals to provide services to us
or on our behalf.
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PART 8 – CRITICAL ESTIMATES AND JUDGMENTS IN
APPLYING ACCOUNTING POLICIES
The consolidated financial statements are prepared in accordance with IFRS, which require the use of estimates
and judgments in reporting assets, liabilities, revenues, expenses and contingencies. In the judgment of management,
none of the estimates outlined in Note 1 – Basis of preparation and material accounting policy information in our
audited consolidated financial statements are considered critical accounting estimates as defined in Canadian
National Instrument 51-102 – Continuous Disclosure Obligations with the exception of the estimates related to the
valuation of property, plant and equipment, financial instruments, deferred income tax liabilities, decommissioning
liabilities and impairment of goodwill. These assumptions include estimates of future electricity prices, discount
rates, expected long-term average generation, inflation rates, terminal year, the amount and timing of operating and
capital costs and the income tax rates of future income tax provisions. Estimates also include determination of
accruals, provisions, purchase price allocations, useful lives, asset valuations, asset impairment testing and those
relevant to the defined benefit pension and non-pension benefit plans. Estimates are based on historical experience,
current trends and various other assumptions that are believed to be reasonable under the circumstances.
In making estimates, management relies on external information and observable conditions where possible,
supplemented by internal analysis, as required. These estimates have been applied in a manner consistent with that
in the prior year and there are no known trends, commitments, events or uncertainties that we believe will materially
affect the methodology or assumptions utilized in this report. These estimates are impacted by, among other things,
future power prices, movements in interest rates, foreign exchange volatility and other factors, some of which are
highly uncertain, as described in the “Risk Factors” section. The interrelated nature of these factors prevents us from
quantifying the overall impact of these movements on Brookfield Renewable’s financial statements in a meaningful
way. These sources of estimation uncertainty relate in varying degrees to substantially all asset and liability account
balances. Actual results could differ from those estimates.
CRITICAL ESTIMATES
Brookfield Renewable makes estimates and assumptions that affect the carrying value of assets and liabilities,
disclosure of contingent assets and liabilities and the reported amount of income and other comprehensive income
(“OCI”) for the year. Actual results could differ from these estimates. The estimates and assumptions that are critical
to the determination of the amounts reported in the consolidated financial statements relate to the following:
(i)
Property, plant and equipment
The fair value of Brookfield Renewable’s property, plant and equipment is calculated using estimates and
assumptions about future electricity prices for renewable sources, anticipated long-term average generation,
estimated operating and capital expenditures, future inflation rates and discount rates, as described in Note 12 –
Property, plant and equipment, at fair value in our audited annual consolidated financial statements. Judgment is
involved in determining the appropriate estimates and assumptions in the valuation of Brookfield Renewable’s
property, plant and equipment. See Note 1(s)(iii) – Critical judgments in applying accounting policies – Property, plant
and equipment in our audited annual consolidated financial statements for further details.
Estimates of useful lives and residual values are used in determining depreciation. To ensure the accuracy of
useful lives and residual values, these estimates are reviewed on an annual basis.
(ii)
Financial instruments
Brookfield Renewable makes estimates and assumptions that affect the carrying value of its financial
instruments, including estimates and assumptions about future electricity prices, long-term average generation,
capacity prices, discount rates, the timing of energy delivery and the elements affecting fair value of the tax equity
financings. Non-financial instruments are valued using estimates of future electricity prices which are estimated by
considering broker quotes for the years in which there is a liquid market and for the subsequent years Brookfield
Renewable’s best estimate of electricity prices that would allow new entrants into the market. The fair value of
interest rate swaps is the estimated amount that another party would receive or pay to terminate the swap agreements
at the reporting date, taking into account current market interest rates. This valuation technique approximates the net
present value of future cash flows.
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For power purchase agreements accounted for under IFRS 9 (“IFRS 9 PPAs”) that have unobservable values,
Brookfield Renewable determines the fair value of these IFRS 9 PPAs using a discounted cash flow model based on
the term of the contract and applies judgements surrounding the inputs used within the valuation model. The
valuation model incorporates various inputs and assumptions including future power prices, contractual prices,
contractual volumes and discount rates. Future power prices are based on broker quotes from independent sources
and for IFRS 9 PPAs with no available broker quotes, future fuel driven merchant prices are incorporated within the
model. Contractual prices are stipulated within each individual agreement, contractual volumes are either specified
within the agreement or determined using future generation of the power generating assets and discount rate used in
the valuation model is the credit adjusted risk free rate. See Note 5 – Risk management and financial instruments in
our audited annual consolidated financial statements for more details.
(iii)
Deferred income taxes
The consolidated financial statements include estimates and assumptions for determining the future tax rates
applicable to subsidiaries and identifying the temporary differences that relate to each subsidiary. Deferred income
tax assets and liabilities are measured at the tax rates that are expected to apply during the year when the assets are
realized or the liabilities settled, using the tax rates and laws enacted or substantively enacted at the consolidated
statements of financial position dates. Operating plans and forecasts are used to estimate when the temporary
difference will reverse.
(iv) Decommissioning liabilities
Decommissioning costs will be incurred at the end of the operating life of some of the company’s assets. These
obligations are typically many years in the future and require judgment to estimate. The estimate of
decommissioning costs can vary in response to many factors including changes in relevant legal, regulatory, and
environmental requirements, the emergence of new restoration techniques or experience at other power generating
facilities. Inherent in the calculations of these costs are assumptions and estimates including the ultimate settlement
amounts, inflation factors, discount rates, and timing of settlements.
(v) Impairment of goodwill
The impairment assessment of goodwill requires estimation of the value-in-use or fair value less costs of
disposal of the CGUs or groups of CGUs to which goodwill has been allocated.
Brookfield Renewable uses the following critical assumptions and estimates for the value-in-use method: the
circumstances that gave rise to the goodwill, timing and amount of future cash flows expected from the CGUs;
discount rates; terminal capitalization rates; terminal valuation dates and future leverage assumptions.
CRITICAL JUDGMENTS IN APPLYING ACCOUNTING POLICIES
The following are the critical judgments that have been made in applying the accounting policies used in the
consolidated financial statements and that have the most significant effect on the amounts in the consolidated
financial statements:
(i)
Preparation of consolidated financial statements
These consolidated financial statements present the financial position, results of operations and cash flows of
Brookfield Renewable. Judgment is required in determining what assets, liabilities and transactions are recognized
in the consolidated financial statements as pertaining to Brookfield Renewable’s operations.
(ii)
Common control transactions
Common control business combinations specifically fall outside the scope of IFRS 3, Business Combinations
(“IFRS 3”), and as such management has used its judgment to determine an appropriate policy to account for these
transactions. Consideration was given to other relevant accounting guidance within the framework of principles in
IFRS and to reflect the economic reality of the transactions, in accordance with IAS 8, Accounting Policies, Changes
in Accounting Estimates and Errors (“IAS 8”). As a result, the consolidated financial statements account for assets
and liabilities acquired at the previous carrying value on the predecessor’s financial statements. Differences between
the consideration given and the assets and liabilities received are recorded directly to equity.
(iii)
Property, Plant and Equipment
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The accounting policy relating to Brookfield Renewable’s property, plant and equipment is described in Note
1(g) – Property, plant and equipment and revaluation method in our audited annual consolidated financial
statements. In applying this policy, judgment is used in determining whether certain costs are additions to the
carrying amount of the property, plant and equipment as opposed to repairs and maintenance that are expensed when
incurred. If an asset has been developed, judgment is required to identify the point at which the asset is capable of
being used as intended and to identify the directly attributable costs to be included in the carrying value of the
development asset. The useful lives of property, plant and equipment are determined by independent engineers
periodically with an annual review by management.
Annually, Brookfield Renewable determines the fair value of its property, plant and equipment using a
methodology that it has judged to be reasonable. The methodology for hydroelectric assets is generally a twenty-
year discounted cash flow model. Twenty years is the period considered reasonable as Brookfield Renewable has
twenty-year capital plans and it believes a reasonable third party would be indifferent between extending the cash
flows further in the model versus using a discounted terminal value. The methodology for wind, solar and storage &
other assets is to align the model length with the expected remaining useful life of the subject assets.
The valuation model incorporates future cash flows from long-term power purchase agreements that are in place
where it is determined that the power purchase agreements are linked specifically to the related power generating
assets. With respect to estimated future generation that does not incorporate long-term power purchase agreement
pricing, the cash flow model uses estimates of future electricity prices using broker quotes from independent sources
for the years in which there is a liquid market. The valuation of generation not linked to long-term power purchase
agreements also requires the development of a long-term estimate of future electricity prices. In this regard the
valuation model uses a discount to the all-in cost of construction with a reasonable return, to secure energy from a
new renewable resource with a similar generation profile to the asset being valued as the benchmark that will
establish the market price for electricity for renewable resources.
Brookfield Renewable’s long-term view is anchored to the cost of securing new energy from renewable sources
to meet future demand growth by the years 2027 to 2035 in North America, 2030 in Colombia, and 2027 in Brazil.
The year of new entry is viewed as the point when generators must build additional capacity to maintain system
reliability and provide an adequate level of reserve generation with the retirement of older coal-fired plants and
rising environmental compliance costs in North America and Europe, and overall increasing demand in Colombia
and Brazil. For the North American and European businesses, Brookfield Renewable has estimated a discount to
these new-build renewable asset prices to determine renewable electricity prices for hydroelectric, solar and wind
facilities. In Brazil and Colombia, the estimate of future electricity prices is based on a similar approach as applied
in North America using a forecast of the all-in cost of development.
Terminal values are included in the valuation of hydroelectric assets in North America and Colombia. For the
hydroelectric assets in Brazil, cash flows have been included based on the duration of the authorization or useful life
of a concession asset with consideration of a one-time thirty-year renewal on qualifying hydroelectric assets.
Discount rates are determined each year by considering the current interest rates, average market cost of capital
as well as the price risk and the geographical location of the operational facilities as judged by management.
Inflation rates are also determined by considering the current inflation rates and the expectations of future rates by
economists. Operating costs are based on long-term budgets escalated for inflation. Each operational facility has a
twenty-year capital plan that it follows to ensure the maximum life of its assets is achieved. Foreign exchange rates
are forecasted by using the spot rates and the available forward rates, extrapolated beyond the period available. The
inputs described above to the discounted cash flow model require management to consider facts, trends and plans in
making its judgments as to what derives a reasonable fair value of its property, plant and equipment.
(iv)
Financial instruments
The accounting policy relating to Brookfield Renewable’s financial instruments is described in Note 1(l) –
Financial instruments in our audited annual consolidated financial statements. In applying the policy, judgments are
made in applying the criteria set out in IFRS 9 – Financial instruments (“IFRS 9”) to record financial instruments at
fair value through profit and loss, and the assessments of the effectiveness of hedging relationships.
For commodity derivatives that have unobservable value, Brookfield Renewable applies judgements
surrounding the inputs used within the valuation model. The valuation model incorporates various inputs and
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assumptions including forward power prices, contractual prices, contractual volumes and discount rates. Forward
power prices are based on broker quotes from independent sources, contractual prices are stipulated within each
individual agreement, contractual volumes are either specified within the agreement or determined using future
generation of the power generating assets and discount rates are determined by considering the current interest rates,
average market cost of capital as well as the price risk and geographical location of the power generating assets as
judged by management.
(v)
Deferred income taxes
The accounting policy relating to Brookfield Renewable’s income taxes is described in Note 1(n) – Income taxes
in our audited annual consolidated financial statements. In applying this policy, judgments are made in determining
the probability of whether deductions, tax credits and tax losses can be utilized.
NEW ACCOUNTING STANDARDS
International Tax Reform - Amendments to IAS 12- Pillar Two model rules
In May 2023, the IASB issued amendments to IAS 12 “Income Taxes” to give entities temporary mandatory
relief from accounting for deferred taxes arising from the Organization for Economic Co-operation and
Developments (“OECD”) international tax reform. The amendments are effective immediately upon their issue and
retrospectively in accordance with IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors,”
except for some targeted disclosure requirements which become effective for annual reporting periods on or after
January 1, 2023. Brookfield Renewable operates in countries which have enacted new legislation to implement the
global minimum top-up tax. Brookfield Renewable has applied the temporary mandatory relief from recognizing
and disclosing information related to the top-up tax and will account for it as a current tax when it is incurred. The
newly enacted legislation is effective from January 1, 2024 and there is no current tax impact for the year ended
December 31, 2023. The global minimum top-up tax is not anticipated to have a significant impact on the financial
position of Brookfield Renewable.
FUTURE CHANGES IN ACCOUNTING POLICIES
Amendments to IAS 1 – Presentation of Financial Statements (“IAS 1”)
The amendments clarify how to classify debt and other liabilities as current or non-current. The amendments to
IAS 1 apply to annual reporting periods beginning on or after January 1, 2024. Brookfield Renewable is currently
assessing the impact of these amendments.
There are currently no other future changes to IFRS with potential impact on Brookfield Renewable.
SUBSEQUENT EVENTS
Subsequent to year-end, Brookfield Renewable issued C$400 million of Series 17 medium-term notes. The
medium-term notes have a fixed interest rate of 5.32% and a maturity date of January 10, 2054. The Series 17
medium-term notes are corporate-level green bonds.
Subsequent to year-end, Brookfield Renewable, together with its institutional partners, completed the
acquisition of a series of development distributed generation projects in the United States totaling 93 MW for total
consideration of approximately $86 million (approximately $17 million net to Brookfield Renewable). Brookfield
Renewable holds a 20% interest in these investments.
Subsequent to year-end, Brookfield Renewable, together with its institutional partners, completed the
acquisition of a series of development distributed generation projects in the United States totaling 60 MW for total
consideration of approximately $39 million (approximately $11 million net to Brookfield Renewable). Brookfield
Renewable holds a 25% interest in these investments.
Subsequent to year-end, Brookfield Renewable repurchased 496,254 LP units on the Toronto Stock Exchange at
a total cost of $12 million.
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PART 9 – PRESENTATION TO STAKEHOLDERS AND
PERFORMANCE MEASUREMENT
PRESENTATION TO PUBLIC STAKEHOLDERS
Equity
Brookfield Renewable’s consolidated equity interests include (i) non-voting publicly traded LP units, held by
public unitholders and Brookfield, (ii) BEPC exchangeable shares, held by public shareholders and Brookfield, (iii)
Redeemable/Exchangeable Limited partnership units in BRELP, a holding subsidiary of Brookfield Renewable, held
by Brookfield, and (iv) the GP interest in BRELP, held by Brookfield.
The LP units, the BEPC exchangeable shares and the Redeemable/Exchangeable partnership units have the
same economic attributes in all respects, except that the BEPC exchangeable shares provide the holder, and the
Redeemable/Exchangeable partnership units provide Brookfield, the right to request that all or a portion of such
shares or units be redeemed for cash consideration. Brookfield Renewable, however, has the right, at its sole
discretion, to satisfy any such redemption request with LP units, rather than cash, on a one-for-one basis. The public
holders of BEPC exchangeable shares, and Brookfield, as holder of BEPC exchangeable shares and Redeemable/
Exchangeable partnership units, participates in earnings and distributions on a per unit basis equivalent to the per
unit participation of the LP units. Because Brookfield Renewable, at its sole discretion, has the right to settle any
redemption request in respect of BEPC exchangeable shares and Redeemable/Exchangeable partnership units with
LP units, the BEPC exchangeable shares and Redeemable/Exchangeable partnership units are classified under
equity, and not as a liability.
Given the exchange feature referenced above, we are presenting LP units, BEPC exchangeable shares,
Redeemable/Exchangeable partnership units, and GP Interest as separate components of consolidated equity. This
presentation does not impact the total income (loss), per unit or share information, or total consolidated equity.
As at the date of this report, Brookfield owns an approximate 48% LP unit interest, on a fully-exchanged basis, and all general partnership interests in Brookfield Renewable, representing a 0.01% interest, while the remaining approximately 52% is held by the public.
Actual and Long-term Average Generation
For assets acquired, disposed or reached commercial operation during the year, reported generation is calculated
from the acquisition, disposition or commercial operation date and is not annualized. Generation on a same store
basis refers to the generation of assets that were owned during both periods presented. As it relates to Colombia
only, generation includes both hydroelectric and cogeneration facilities. Distributed energy & storage includes
generation from our distributed generation and pumped storage assets. Sustainable solutions includes North America
cogeneration, Brazil biomass, and power transformation assets.
North America hydroelectric long-term average is the expected average level of generation based on the results
of a simulation based on historical inflow data performed over a period of typically 30 years. Colombia
hydroelectric long-term average is the expected average level of generation based on the results of a simulation
based on historical inflow data performed over a period of typically 20 years. For substantially all of our
hydroelectric assets in Brazil the long-term average is based on the reference amount of electricity allocated to our
facilities under the market framework which levelizes generation risk across producers. Wind long-term average is
the expected average level of generation based on the results of simulated historical wind speed data performed over
a period of typically 10 years. Utility-scale solar long-term average is the expected average level of generation based
on the results of a simulation using historical irradiance levels in the locations of our projects from the last 14 to 20
years combined with actual generation data during the operational period.
We compare actual generation levels against the long-term average to highlight the impact of an important
factor that affects the variability of our business results. In the short-term, we recognize that hydrology, wind and
irradiance conditions will vary from one period to the next; over time however, we expect our facilities will continue
to produce in line with their long-term averages, which have proven to be reliable indicators of performance.
Our risk of a generation shortfall in Brazil continues to be minimized by participation in the Energy
Reallocation Mechanism (“MRE”) administered by the government of Brazil. This program mitigates hydrology risk
by assuring that all participants receive, at any particular point in time, an assured energy amount, irrespective of the
actual volume of energy generated. The program reallocates energy, transferring surplus energy from those who
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generated an excess to those who generate less than their assured energy, up to the total generation within the pool.
Periodically, low precipitation across the entire country’s system could result in a temporary reduction of generation
available for sale. During these periods, we expect that a higher proportion of thermal generation would be needed to
balance supply and demand in the country, potentially leading to higher overall spot market prices.
Generation from our pumped storage and cogeneration facilities in North America is highly dependent on
market price conditions rather than the generating capacity of the facilities. Our pumped storage facility in Europe
generates on a dispatchable basis when required by our contracts for ancillary services. Generation from our biomass
facilities in Brazil is dependent on the amount of sugar cane harvested in a given year. For these reasons, we do not
consider a long-term average for these facilities.
Voting Agreements with Affiliates
Brookfield Renewable has entered into voting agreements with Brookfield, whereby Brookfield Renewable
gained control or have significant influence over the entities that own certain renewable power and sustainable
solution investments. Brookfield Renewable has also entered into a voting agreement with its consortium partners in
respect of the Colombian business. The voting agreements provide Brookfield Renewable the authority to direct the
election of the Boards of Directors of the relevant entities, among other things, and therefore provide Brookfield
Renewable with control. Accordingly, Brookfield Renewable consolidates the accounts of these entities.
For entities previously controlled by Brookfield Corporation, the voting agreements entered into do not
represent business combinations in accordance with IFRS 3, as all combining businesses are ultimately controlled by
Brookfield Corporation both before and after the transactions were completed. Brookfield Renewable accounts for
these transactions involving entities under common control in a manner similar to a pooling of interest, which
requires the presentation of pre-voting agreement financial information as if the transactions had always been in
place. Refer to Note 1(s)(ii) – Critical judgments in applying accounting policies – Common control transactions in
our December 31, 2023 audited consolidated financial statements for our policy on accounting for transactions under
common control.
PERFORMANCE MEASUREMENT
Segment Information
Our operations are segmented by – 1) hydroelectric, 2) wind, 3) utility-scale solar, 4) distributed energy and
storage (distributed generation and pumped storage), 5) sustainable solutions (renewable natural gas, carbon capture
and storage, recycling, cogeneration biomass, nuclear services, and power transformation), and 6) corporate - with
hydroelectric further segmented by geography (i.e., North America, Colombia, and Brazil). This best reflects the
way in which the CODM reviews results of our company.
The reporting to the CODM was revised during the year to disaggregate the distributed energy & sustainable
solutions business into distributed energy & storage and sustainable solutions. This change is consistent with the
development of Brookfield Renewable’s business as distributed generation and sustainable solutions continue to
grow as a more significant component of the business. The financial information of operating segments in the prior
period has been restated to present the corresponding results of the distributed energy & storage and sustainable
solutions.
We report our results in accordance with these segments and present prior period segmented information in a
consistent manner. See Note 6 – Segmented information in our audited annual consolidated financial statements.
One of our primary business objectives is to generate stable and growing cash flows while minimizing risk for
the benefit of all stakeholders. We monitor our performance in this regard through three key metrics — i) Net
Income (Loss), ii) Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”),
and iii) Funds From Operations.
It is important to highlight that Adjusted EBITDA and Funds From Operations do not have any standardized
meaning prescribed by IFRS and therefore are unlikely to be comparable to similar measures presented by other
companies and have limitations as analytical tools. We provide additional information below on how we determine
Adjusted EBITDA and Funds From Operations. We also provide reconciliations to Net income (loss). See “Part 4 –
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Financial Performance Review on Proportionate Information – Reconciliation of Non-IFRS Measures” and “Part 6 –
Selected Annual and Quarterly Information – Reconciliation of Non-IFRS measures”.
Proportionate Information
Reporting to the CODM on the measures utilized to assess performance and allocate resources has been
provided on a proportionate basis. Information on a proportionate basis reflects Brookfield Renewable’s share from
facilities which it accounts for using consolidation and the equity method whereby Brookfield Renewable either
controls or exercises significant influence or joint control over the investment, respectively. Proportionate
information provides a Unitholder perspective that the CODM considers important when performing internal
analyses and making strategic and operating decisions. The CODM also believes that providing proportionate
information helps investors understand the impacts of decisions made by management and financial results that can
be allocated to Unitholders.
Proportionate financial information is not, and is not intended to be, presented in accordance with IFRS. Tables
reconciling IFRS data with data presented on a proportionate basis have been disclosed. Segment revenues, other
income, direct operating costs, interest expense, depreciation, current and deferred income taxes, and other are items
that will differ from results presented in accordance with IFRS as these items (1) include Brookfield Renewable’s
proportionate share of earnings (loss) from equity-accounted investments attributable to each of the above-noted
items, and (2) exclude the proportionate share of earnings (loss) of consolidated investments not held by us
apportioned to each of the above-noted items.
The presentation of proportionate results has limitations as an analytical tool, including the following:
•
•
The amounts shown on the individual line items were derived by applying our overall economic
ownership interest percentage and do not necessarily represent our legal claim to the assets and
liabilities, or the revenues and expenses; and
Other companies may calculate proportionate results differently than we do.
Because of these limitations, our proportionate financial information should not be considered in isolation or as
a substitute for our financial statements as reported under IFRS.
Brookfield Renewable does not control those entities that have not been consolidated and as such, have been
presented as equity-accounted investments in its financial statements. The presentation of the assets and liabilities
and revenues and expenses do not represent Brookfield Renewable’s legal claim to such items, and the removal of
financial statement amounts that are attributable to non-controlling interests does not extinguish Brookfield
Renewable’s legal claims or exposures to such items.
Unless the context indicates or requires otherwise, information with respect to the megawatts (“MW”)
attributable to Brookfield Renewable’s facilities, including development assets, is presented on a consolidated basis,
including with respect to facilities whereby Brookfield Renewable either controls or jointly controls the applicable
facility.
Net Income (Loss)
Net income (loss) is calculated in accordance with IFRS.
Net income (loss) is an important measure of profitability, in particular because it has a standardized meaning
under IFRS. The presentation of net income (loss) on an IFRS basis for our business will often lead to the
recognition of a loss even though the underlying cash flows generated by the assets are supported by strong margins
and stable, long-term power purchase agreements. The primary reason for this is that accounting rules require us to
recognize a significantly higher level of depreciation for our assets than we are required to reinvest in the business as
sustaining capital expenditures.
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Adjusted EBITDA
Adjusted EBITDA is a non-IFRS measure used by investors to analyze the operating performance of
companies.
Brookfield Renewable uses Adjusted EBITDA to assess the performance of Brookfield Renewable before the
effects of interest expense, income taxes, depreciation, management service costs, non-controlling interests,
unrealized gain or loss on financial instruments, non-cash income or loss from equity-accounted investments,
distributions to preferred shareholders, preferred limited partnership unit holders, perpetual subordinated noteholders
and other typical non-recurring items. Brookfield Renewable adjusts for these factors as they may be non-cash,
unusual in nature and/or are not factors used by management for evaluating operating performance. Brookfield
Renewable includes realized disposition gains and losses on assets that we developed and/or did not intend to hold
over the long-term within Adjusted EBITDA in order to provide additional insight regarding the performance of
investments on a cumulative realized basis, including any unrealized fair value adjustments that were recorded in
equity and not otherwise reflected in current period Adjusted EBITDA.
Brookfield Renewable believes that presentation of this measure will enhance an investor’s ability to evaluate
its financial and operating performance on an allocable basis.
Funds From Operations
Funds From Operations is a non-IFRS measure used by investors to analyze net earnings from operations
without the effects of certain volatile items that generally have no current financial impact or items not directly
related to the performance of Brookfield Renewable.
Brookfield Renewable uses Funds From Operations to assess the performance of Brookfield Renewable before
the effects of certain cash items (e.g., acquisition costs and other typical non-recurring cash items) and certain non-
cash items (e.g., deferred income taxes, depreciation, non-cash portion of non-controlling interests, unrealized gain
or loss on financial instruments, non-cash gain or loss from equity-accounted investments, and other non-cash items)
as these are not reflective of the performance of the underlying business. In the consolidated financial statements of
Brookfield Renewable, the revaluation approach is used in accordance with IAS 16, Property, Plant and Equipment,
whereby depreciation is determined based on a revalued amount, thereby reducing comparability with peers who do
not report under IFRS as issued by the IASB or who do not employ the revaluation approach to measuring property,
plant and equipment. Management adds back deferred income taxes on the basis that they do not believe this item
reflects the present value of the actual tax obligations that they expect Brookfield Renewable to incur over the long-
term investment horizon of Brookfield Renewable.
Brookfield Renewable believes that analysis and presentation of Funds From Operations on this basis will
enhance an investor’s understanding of the performance of Brookfield Renewable. Funds From Operations is not a
substitute measure of performance for earnings per share and does not represent amounts available for distribution.
Funds From Operations is not a generally accepted accounting measure under IFRS and therefore may differ
from definitions of Funds From Operations used by other entities, as well as the definition of funds from operations
used by the Real Property Association of Canada (“REALPAC”) and the National Association of Real Estate
Investment Trusts, Inc. (“NAREIT”). Furthermore, this measure is not used by the CODM to assess Brookfield
Renewable’s liquidity.
Proportionate Debt
Proportionate debt is presented based on the proportionate share of borrowings obligations relating to the
investments of Brookfield Renewable in various portfolio businesses. The proportionate financial information is not,
and is not intended to be, presented in accordance with IFRS. Proportionate debt measures are provided because
management believes it assists investors and analysts in estimating the overall performance and understanding the
leverage pertaining specifically to Brookfield Renewable’s share of its invested capital in a given investment. When
used in conjunction with Proportionate Adjusted EBITDA, proportionate debt is expected to provide useful
information as to how Brookfield Renewable has financed its businesses at the asset-level. Management believes
that the proportionate presentation, when read in conjunction with Brookfield Renewable’s reported results under
IFRS, including consolidated debt, provides a more meaningful assessment of how the operations of Brookfield
Renewable are performing and capital is being managed.
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The presentation of proportionate results has limitations as an analytical tool, including the following:
•
Proportionate debt amounts do not represent the consolidated obligation for debt underlying a consolidated
investment. If an individual project does not generate sufficient cash flows to service the entire amount of
its debt payments, management may determine, in their discretion, to pay the shortfall through an equity
injection to avoid defaulting on the obligation. Such a shortfall may not be apparent from or may not equal
the difference between aggregate Proportionate Adjusted EBITDA for all of the portfolio investments of
Brookfield Renewable and aggregate proportionate debt for all of the portfolio investments of Brookfield
Renewable; and
•
Other companies may calculate proportionate debt differently.
Because of these limitations, the proportionate financial information of Brookfield Renewable should not be
considered in isolation or as a substitute for the financial statements of Brookfield Renewable as reported under
IFRS.
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PART 10 – CAUTIONARY STATEMENTS
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements and information, within the meaning of Canadian securities laws and “forward-looking
statements” within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, Section 21E of the U.S. Securities Exchange Act of
1934, as amended, “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995 and in any applicable
Canadian securities regulations, concerning the business and operations of Brookfield Renewable. Forward-looking statements may include
estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Forward-looking
statements in this report include, but are not limited to, statements regarding the quality of Brookfield Renewable’s assets and the resiliency of
the cash flow they will generate, our anticipated financial performance, future commissioning of assets, contracted portfolio, technology
diversification, acquisition opportunities, expected completion of acquisitions and dispositions, future energy prices and demand for electricity,
economic recovery, achieving long-term average generation, project development and capital expenditure costs, energy policies, economic
growth, growth potential of the renewable asset class, our future growth prospects and distribution profile, our access to capital and future
dividends and distributions made to holders of LP units and BEPC's exchangeable shares. In some cases, forward-looking statements can be
identified by the use of words such as “plans”, “expects”, “scheduled”, “estimates”, “intends”, “anticipates”, “believes”, “potentially”,
“tends”, “continue”, “attempts”, “likely”, “primarily”, “approximately”, “endeavors”, “pursues”, “strives”, “seeks”, “targets”, “believes”,
or variations of such words and phrases, or statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” or
“will” be taken, occur or be achieved. These forward-looking statements and information are not historical facts but reflect our current
expectations regarding future results or events and are based on information currently available to us and on assumptions we believe are
reasonable. Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking
statements and information in this report are based upon reasonable assumptions and expectations, we cannot assure you that such expectations
will prove to have been correct. You should not place undue reliance on forward-looking statements and information as such statements and
information involve assumptions, known and unknown risks, uncertainties and other factors which may cause our actual results, performance or
achievements to differ materially from anticipated future results, performance or achievements expressed or implied by such forward-looking
statements and information. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of
which are known to us or are within our control. If a change occurs, our business, financial condition, liquidity and result of operations and our
plans and strategies may vary materially from those expressed in the forward-looking statements and forward-looking information herein.
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but
are not limited to, the following: general economic conditions and risks relating to the economy, including unfavorable changes in interest rates,
foreign exchange rates, inflation and volatility in the financial markets; changes to resource availability, as a result of climate change or
otherwise, at any of our renewable power facilities; supply, demand, volatility and marketing in the energy markets; our inability to re-negotiate
or replace expiring contracts (including PPAs, power guarantee agreements or similar long-term agreements, between a seller and a buyer of
electrical power generation)on similar terms; an increase in the amount of uncontracted generation in our renewable power portfolio or a
change in the contract profile for future renewable power projects; availability and access to interconnection facilities and transmission systems;
our ability to comply with, secure, replace or renew concessions, licenses, permits and other governmental approvals needed for our operating
and development projects; our real property rights for our facilities being adversely affected by the rights of lienholders and leaseholders that
are superior to those granted to us; increases in the cost of operating our existing facilities and of developing new projects; equipment failures
and procurement challenges; increased regulation of and third party opposition to our nuclear services business’s customers and operations;
failure of the nuclear power industry to expand ;insufficient indemnification for our nuclear services business; our reliance on computerized
business systems, which could expose us to cyber-attacks; dam failures and the costs and potential liabilities associated with such failures;
uninsurable losses and higher insurance premiums; changes in regulatory, political, economic and social conditions in the jurisdictions in which
we operate; force majeure events; health, safety, security and environmental risks; energy marketing risks and our ability to manage commodity
and financial risk; the termination of, or a change to, the MRE balancing pool in Brazil; involvement in litigation and other disputes, and
governmental and regulatory investigations; counterparties to our contracts not fulfilling their obligations; the time and expense of enforcing
contracts against non-performing counterparties and the uncertainty of success; foreign laws or regulation to which we become subject as a
result of future acquisitions in new markets; our operations being affected by local communities; newly developed technologies or new business
lines in which we invest not performing as anticipated; advances in technology that impair or eliminate the competitive advantage of our
projects; increases in water rental costs (or similar fees) or changes to the regulation of water supply; labor disruptions and economically
unfavorable collective bargaining agreements; our inability to finance our operations and fund growth due to the status of the capital markets or
our ability to complete capital recycling initiatives; operating and financial restrictions imposed on us by our loan, debt and security agreements;
changes to our credit ratings; the incurrence of debt at multiple levels within our organizational structure; restrictions on our ability to engage in
certain activities or make distributions due to our indebtedness; adverse changes in currency exchange rates and our inability to effectively
manage foreign currency exposure through our hedging strategy or otherwise; our inability to identify sufficient investment opportunities and
complete transactions; political instability or changes in government policy negatively impacting our business or assets; changes to our current
business, including through future sustainable solutions investments; the growth of our portfolio and our inability to realize the expected benefits
of our transactions or acquisitions; our inability to develop the projects in our development pipeline; delays, cost overruns and other problems
associated with the construction and operation of our facilities and risks associated with the arrangements we enter into with communities and
joint venture partners; we do not have control over all of our operations or investments, including certain investments made through joint
ventures, partnerships, consortiums or structured arrangements; some of our acquisitions may be of distressed companies, which may subject us
to increased risks; a decline in the value of our investments in securities, including publicly traded securities of other companies; the separation
of economic interest from control within our organizational structure; the separation of economic interest from control within our organizational
structure; our dependence on Brookfield and Brookfield’s significant influence over us; Brookfield’s election not to source acquisition
opportunities for us and our lack of access to all renewable power acquisitions that Brookfield identifies, including by reason of conflicts of
interest; the departure of some or all of Brookfield’s key professionals; Brookfield acting in a way that is not in our best interests or the best
interests of our shareholders or our unitholders; our inability to terminate the Master Services Agreement and the limited liability of the Service
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Provider under our arrangements with them; Brookfield’s relationship with Oaktree; changes in how Brookfield elects to hold its ownership
interests in Brookfield Renewable; changes in the amount of cash we can distribute to our unitholders; future sales or issuances of our securities
will result in dilution of existing holders and even the perception of such sales or issuances taking place could depress the trading price of the
BEP units or BEPC exchangeable shares; any changes in the market price of the BEP units and BEPC exchangeable shares; the inability of our
unitholders to take part in the management of BEP; limits on unitholders’ ability to obtain favourable judicial forum for disputes related to BEP
or to enforce judgements against us; our reliance on subsidiaries to provide funds to pay distributions; changes in tax law and practice; changes
to government policies and incentives relating to the renewable power and sustainable solutions industries; adverse impacts of inflationary
pressures; changes in regulatory, political, economic and social conditions in the jurisdictions in which we operate; health, safety, security and
environmental risks; force majeure events; foreign currency risk associated with BEP’s distributions; fraud, bribery, corruption, other illegal
acts or inadequate or failed internal processes or systems and restrictions on foreign direct investment; increased regulation of our operations;
we are not subject to the same disclosure requirements as a U.S. domestic issuer; changes in our credit ratings; new regulatory initiatives related
to sustainability and ESG; human rights impacts of our business activities; being deemed an “investment company” under the Investment
Company Act; the effectiveness of our internal controls over financial reporting; and other factors described in our most recent Annual Report on
Form 20-F, including those set forth under Item 3.D “Risk Factors”.
We caution that the foregoing list of important factors that may affect future results is not exhaustive. The forward-looking statements
represent our views as of the date of this report and should not be relied upon as representing our views as of any date subsequent to the date of
this report. While we anticipate that subsequent events and developments may cause our views to change, we disclaim any obligation to update
the forward-looking statements, other than as required by applicable law. For further information on these known and unknown risks, please see
“Risk Factors” included in our most recent Annual Report on Form 20-F and other risks and factors that are described therein.
CAUTIONARY STATEMENT REGARDING USE OF NON-IFRS MEASURES
This report contains references to Adjusted EBITDA, Funds From Operations and Funds From Operations per Unit which are not
generally accepted accounting measures standardized under IFRS and therefore may differ from definitions of Adjusted EBITDA, Funds From
Operations and Funds From Operations per Unit used by other entities. In particular, our definition of Funds From Operations may differ from
the definition of funds from operations used by other organizations, as well as the definition of funds from operations used by the Real Property
Association of Canada and the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”), in part because the NAREIT definition is
based on U.S. GAAP, as opposed to IFRS. We believe that Adjusted EBITDA, Funds From Operations and Funds From Operations per Unit are
useful supplemental measures that may assist investors in assessing our financial performance. None of Adjusted EBITDA, Funds From
Operations or Funds From Operations per Unit should be considered as the sole measure of our performance and should not be considered in
isolation from, or as a substitute for, analysis of our financial statements prepared in accordance with IFRS. These non-IFRS measures reflect
how we manage our business and, in our opinion, enable the reader to better understand our business.
Reconciliations of each of Adjusted EBITDA, Funds From Operations and Funds From Operations per Unit to net income (loss) are presented
in our Management’s Discussion and Analysis. We have also provided a reconciliation of Adjusted EBITDA and Funds From Operations to net
income inNote 6 – Segmented information in the audited annual consolidated financial statements.
Page 64
Management’s Responsibility for Financial Statements
MANAGEMENT’S RESPONSIBILITY
The accompanying consolidated financial statements have been prepared by Brookfield Renewable Partners L.P.
(“Brookfield Renewable”) management which is responsible for their integrity, consistency, objectivity and
reliability. To fulfill this responsibility, Brookfield Renewable maintains policies, procedures and systems of internal
control to ensure that its reporting practices and accounting and administrative procedures are appropriate to provide
a high degree of assurance that relevant and reliable financial information is produced and assets are safeguarded.
These controls include the careful selection and training of employees, the establishment of well-defined areas of
responsibility and accountability for performance, and the communication of policies and the code of conduct
throughout the company.
These consolidated financial statements have been prepared in conformity with International Financial Reporting
Standards as issued by the International Accounting Standards Board and, where appropriate, reflect estimates based
on management’s judgment.
Ernst & Young LLP, the Independent Registered Public Accounting Firm appointed by the directors of the general
partner of Brookfield Renewable, have audited the consolidated financial statements in accordance with the
standards of the Public Company Accounting Oversight Board (United States) to enable them to express to the
partners their opinion on the consolidated financial statements. Their report outlines the scope of their examination
and opinion on the consolidated financial statements.
The consolidated financial statements have been further reviewed and approved by the Board of Directors of the
general partner of Brookfield Renewable acting through its Audit Committee, which is comprised of directors who
are not officers or employees of Brookfield Renewable. The Audit Committee, which meets with the auditors and
management to review the activities of each and reports to the Board of Directors, oversees management’s
responsibilities for the financial reporting and internal control systems. The auditors have full and direct access to
the Audit Committee and meet periodically with the committee both with and without management present to
discuss their audit and related findings.
/s/ Connor Teskey
Connor Teskey
Chief Executive Officer
February 29, 2024
/s/ Wyatt Hartley
Wyatt Hartley
Chief Financial Officer
Page 65
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of Brookfield Renewable Partners Limited (General Partner of Brookfield Renewable
Partners L.P.) and Partners of Brookfield Renewable Partners L.P.
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Brookfield Renewable Partners
L.P. (“Brookfield Renewable” or the “Partnership”) as of December 31, 2023 and 2022, the related consolidated
statements of income (loss), comprehensive income, changes in equity and cash flows for each of the three years in
the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”). In
our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the
Partnership at December 31, 2023 and 2022, and its financial performance and its cash flows for each of the three
years in the period ended December 31, 2023, in conformity with International Financial Reporting Standards
(“IFRSs”) as issued by the International Accounting Standards Board.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (“PCAOB”), the Partnership’s internal control over financial reporting as of December 31, 2023, based on
criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission (2013 framework) and our report dated February 29, 2024 expressed an unqualified
opinion thereon.
Basis for Opinion
These financial statements are the responsibility of Brookfield Renewable’s management. Our responsibility is to
express an opinion on the Partnership’s financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Partnership in accordance with the
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of
material misstatement of the financial statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the financial statements. Our audits also included evaluating the accounting principles used and
significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial
statements that were communicated or required to be communicated to the audit committee and that: (1) relate to
accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially
challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way
our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the
critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or
disclosures to which they relate.
Page 66
Description of the Matter
How We Addressed the
Matter in Our Audit
Revaluation of power generating assets
The Partnership measures power generating assets (classified as property, plant and
equipment) using the revaluation method under IAS 16, Property, Plant and
Equipment. As at December 31, 2023, property, plant and equipment on the
consolidated statement of financial position totaled $64,005 million. Revaluations of
property, plant and equipment recognized in the consolidated statement of
comprehensive income totaled a loss of $133 million and a loss in the consolidated
statement of income (loss) of $164 million for 2023. As discussed in Notes 1(g),
1(r)(i) and 1(s) (iii) and 12 – Property, Plant and Equipment, at Fair Value to the
consolidated financial statements, significant estimation and management judgment
are involved in assessing the estimates and assumptions regarding the future
performance of the power generating assets.
Management applies a dual approach which involves a discounted cash flow model
as well as a market evaluation in determining the fair value of the Partnership’s
power generating assets. Significant assumptions included within the discounted
cash flow models are future electricity prices, terminal value, discount rates,
anticipated long-term average generation and estimated operating and capital
expenditures.
Auditing the measurement of power generating assets is complex due to the highly
judgmental nature of the significant assumptions described above, which required
the involvement of specialists. Changes in these assumptions can have a material
effect on the fair value of the power generating assets.
We obtained an understanding, evaluated the design and tested the operating
effectiveness of controls over management’s processes in determining the fair value
of power generating assets. We tested controls over management’s review of the
valuation models, including the controls over the review and approval of all
significant assumptions.
To test the fair value of the power generating assets, our audit procedures included,
among others, evaluating the Partnership’s valuation methodology, the significant
assumptions used, and testing the completeness and accuracy of the underlying data
supporting the significant assumptions. For each power generating asset, we
analyzed the significant drivers of the change in fair value including the future
electricity prices, terminal value and discount rates. With the support of our
valuation specialists, we inspected management’s valuation analysis and assessed
the estimates of future electricity prices by reference to shorter-term broker price
quotes and management’s longer-term market forecasts specific to each region and
power generating asset. We also involved our valuation specialists in the evaluation
of the terminal value and discount rates, which included consideration of benchmark
interest rates, geographic location, whether the asset is contracted or uncontracted
and type of technology.
For a sample of power generating assets, we performed audit procedures that
included, among others, agreeing contracted power prices to executed power
purchase agreements and assessing the anticipated long-term average generation
through corroboration with third party engineering reports and historical trends.
Further, we assessed the estimated operating and capital expenditures by
comparison to historical data and to third party data for a selection of assets and
corroboration with third party engineering reports. We also tested the computational
accuracy of the fair value model.
Page 67
Description of the Matter
How We Addressed the
Matter in Our Audit
With the assistance of our valuation specialists for the same samples, we also
performed a sensitivity analysis over the future electricity prices, terminal value and
discount rates to evaluate the fair value of power generating assets. We also
evaluated the fair values using other market-based evidence by comparing the
portfolio as a whole to recent similar transactions and by calculating the revenue
and EBITDA multiples of a sample of the power generating assets and comparing
them to multiples of comparable public companies.
Furthermore, we evaluated the adequacy of the Partnership’s disclosures regarding
the significant assumptions and sensitivity analysis around the fair value of power
generating assets.
Significant acquisitions: wind and solar portfolio’s
During 2023, the Partnership completed the acquisitions of a U.S. Renewable
Portfolio, an India Renewable Portfolio and a U.K. Wind Portfolio for purchase
price of $1,083 million, $447 million, and $625 million, respectively. As described
in Notes 1(o) and 3 – Acquisitions to the consolidated financial statements, these
business combinations are accounted for using the acquisition method, and the
results of operations have been included in the consolidated financial statements
since the corresponding dates of acquisition.
Auditing the above noted acquisitions is complex given that significant estimation is
required in determining the fair value of the power generating assets, tax equity
liabilities and commodity derivatives acquired. The significant assumptions related
to these estimates include but are not limited to future electricity prices, production
tax credits, generation volumes, discount rates, terminal value and operating and
capital expenditures. These assumptions are forward looking and could be affected
by future economic and market conditions.
We obtained an understanding and evaluated the design of controls over
management’s processes in determining the fair value of power generating assets,
tax equity liabilities and commodity derivatives acquired. We tested controls over
management’s review of the power generating assets, tax equity and commodity
derivative valuation models, including the controls over the review and approval of
all significant assumptions.
to available engineering
Our audit procedures included, among others, assessing the significant assumptions
described above and testing the completeness and accuracy of the underlying data.
For example, we evaluated the estimated generation volumes for a sample of power
reports,
them
generating assets by comparing
benchmarking capacity factors against publicly available industry generation data,
and also considering industry benchmarks for losses that impact capacity factors.
Further, with the support of our valuation specialists, we inspected management’s
valuation analysis and assessed the estimates of future electricity prices by reference
to shorter-term broker price quotes and management’s longer-term market forecasts
specific to each region and power generating asset. For production tax credit rates,
we assessed management’s future projections against stated guidance for all
production tax credit regimes and ensured that management’s projection was
reasonable based on published guidance. We involved our valuation specialists to
assist in evaluating the valuation methodologies and the significant assumptions,
including discount rates and terminal values, used in the Partnership’s models,
which included consideration of benchmark interest rates, geographic location,
contracted or uncontracted assets and type of technology, as well as performing
sensitivity analysis on such significant assumptions.
Page 68
Further, we assessed the estimated capital expenditures by corroborating against
recently signed construction contracts and component supply agreements. We
compared operating expenditures to available engineering reports. We also
compared operating expenditure forecasts against industry benchmarks and signed
operations and maintenance contracts. We also tested the computational accuracy
of the fair value model and considered the adequacy of disclosures made in Note 3
to the consolidated financial statements in respect of these judgements and
estimates.
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants
We have served as Brookfield Renewable’s auditor since 2011.
Toronto, Canada
February 29, 2024
Page 69
INTERNAL CONTROL OVER FINANCIAL REPORTING
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated
the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended (Exchange Act)), as of the end of the period December 31, 2023.
Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of
December 31, 2023, our disclosure controls and procedures are designed at a reasonable assurance level and are
effective to provide reasonable assurance that material information we are required to disclose in reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified
in the rules and forms of the Securities and Exchange Commission, and that such information is accumulated and
communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure. While disclosure controls and procedures and
internal controls over financial reporting were adequate and effective we continue to implement certain measures to
strengthen control processes and procedures.
Management’s Report on Internal Control over Financial Reporting
Management of Brookfield Renewable Partners L.P. (“Brookfield Renewable”) is responsible for establishing and
maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process
designed by, or under the supervision of, the Chief Executive Officer and the Chief Financial Officer and effected by
the Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with International
Financial Reporting Standards as issued by the International Accounting Standards Board as defined in Regulation
240.13a–15(f) or 240.15d–15(f).
Management assessed the effectiveness of Brookfield Renewable’s internal control over financial reporting as of
December 31, 2023, based on the criteria set forth in Internal Control – Integrated Framework issued by the
Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on this assessment,
management concludes that, as of December 31, 2023, Brookfield Renewable’s internal control over financial
reporting is effective. Management excluded from its design and assessment of the internal controls of investments
acquired in 2023, which include a 12 GW operating and development portfolio of utility-scale solar, wind and
battery storage assets in United States, a 4.5 GW operating and development portfolio of utility-scale solar, wind and
distributed generation assets in India, a 4 GW operating and development portfolio of utility-scale wind, battery and
solar assets in the United Kingdom, a 136 MW portfolio of operating wind assets in Brazil, a 730 MW portfolio of
distributed generation assets in Brazil, and a 60 MW portfolio of operating and wind assets in Brazil, whose total
assets and net assets on a combined basis constitute approximately 10% and 10%, respectively, of the consolidated
financial statement amounts as of December 31, 2023 and 3% of revenues for the year then ended.
Brookfield Renewable’s internal control over financial reporting as of December 31, 2023, has been audited by
Ernst & Young LLP, the Independent Registered Public Accounting Firm, who also audited Brookfield Renewable’s
consolidated financial statements for the year ended December 31, 2023. As stated in the Report of Independent
Registered Public Accounting Firm, Ernst & Young LLP expressed an unqualified opinion on the effectiveness of
Brookfield Renewable’s internal control over financial reporting as of December 31, 2023.
/s/ Connor Teskey
Connor Teskey
Chief Executive Officer
February 29, 2024
/s/ Wyatt Hartley
Wyatt Hartley
Chief Financial Officer
Page 70
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of Brookfield Renewable Partners Limited (General Partner of Brookfield Renewable
Partners L.P.) and Partners of Brookfield Renewable Partners L.P.
Opinion on Internal Control Over Financial Reporting
We have audited Brookfield Renewable Partners L.P.’s (“Brookfield Renewable” or the “Partnership") internal
control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013
framework) (the “COSO criteria”). In our opinion, the Partnership maintained, in all material respects, effective
internal control over financial reporting as of December 31, 2023, based on the COSO criteria.
As indicated in the accompanying Management’s Report on Internal Control Over Financial Reporting,
management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not
include the internal controls of the 12 GW operating and development portfolio of utility-scale solar, wind and
battery storage assets in the United States, the 4.5 GW operating and development portfolio of utility-scale solar,
wind and distributed generation assets in India, the 4 GW of operating and development portfolio of utility-scale
wind, battery and solar assets in the United Kingdom, the 136 MW portfolio of operating wind assets in Brazil, the
730 MW portfolio of distributed generation assets in Brazil, and the 60 MW portfolio of operating and wind assets
in Brazil. The aforementioned acquisitions are included in the 2023 consolidated financial statements of the
Partnership and constituted approximately 10% and 10% of total and net assets, respectively on a combined basis as
of December 31, 2023 and 3% of revenues for the year then ended. Our audit of internal control over financial
reporting of the Partnership also did not include an evaluation of the internal control over financial reporting of the
aforementioned acquisitions.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (“PCAOB”), the 2023 consolidated financial statements of the Partnership and our report dated February 29,
2024 expressed an unqualified opinion thereon.
Basis for Opinion
Brookfield Renewable’s management is responsible for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control over financial reporting included in the
accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express
an opinion on the Partnership’s internal control over financial reporting based on our audit. We are a public
accounting firm registered with the PCAOB and are required to be independent with respect to the Partnership in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on
the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We
believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
Page 71
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants
Toronto, Canada
February 29, 2024
Page 72
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
AS AT DECEMBER 31
(MILLIONS)
Assets
Current assets
Notes
2023
2022
Cash and cash equivalents ................................................................................................................
Restricted cash ..................................................................................................................................
Trade receivables and other current assets .......................................................................................
Financial instrument assets ...............................................................................................................
Due from related parties ...................................................................................................................
Assets held for sale ...........................................................................................................................
Financial instrument assets ..................................................................................................................
Equity-accounted investments .............................................................................................................
Property, plant and equipment, at fair value ........................................................................................
Goodwill ..............................................................................................................................................
Deferred income tax assets ..................................................................................................................
Other long-term assets .........................................................................................................................
Total Assets .........................................................................................................................................
Liabilities
Current liabilities
20
21
22
5
28
4
5
19
12
17
11
23
Accounts payable and accrued liabilities .........................................................................................
Financial instrument liabilities .........................................................................................................
Due to related parties ........................................................................................................................
Corporate borrowings .......................................................................................................................
Non-recourse borrowings .................................................................................................................
Provisions ......................................................................................................................................... 25, 27
Liabilities directly associated with assets held for sale ....................................................................
24
5
28
13
13
4
Financial instrument liabilities .............................................................................................................
Corporate borrowings ..........................................................................................................................
Non-recourse borrowings ....................................................................................................................
Deferred income tax liabilities .............................................................................................................
Provisions ............................................................................................................................................ 25, 27
Due to related parties ...........................................................................................................................
Other long-term liabilities ....................................................................................................................
Equity
Non-controlling interests
5
13
13
11
28
26
Participating non-controlling interests – in operating subsidiaries ...................................................
General partnership interest in a holding subsidiary held by Brookfield .........................................
Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable
units held by Brookfield ................................................................................................................
BEPC exchangeable shares .........................................................................................................
Preferred equity .................................................................................................................................
Perpetual subordinated notes ......................................................................................................
Preferred limited partners’ equity ........................................................................................................
Limited partners’ equity .......................................................................................................................
14
14
14
14
14
14
15
16
$
$
$
1,141 $
310
1,517
199
1,443
—
4,610
1,768
2,546
64,005
1,944
244
1,011
76,128 $
1,539 $
687
835
183
4,752
42
—
8,038
2,433
2,650
22,117
7,174
1,268
705
1,764
18,863
55
2,684
2,479
583
592
760
3,963
Total Equity ........................................................................................................................................
Total Liabilities and Equity ..............................................................................................................
$
$
29,979 $
76,128 $
The accompanying notes are an integral part of these consolidated financial statements.
Approved on behalf of Brookfield Renewable Partners L.P.:
Patricia Zuccotti
Director
David Mann
Director
998
139
1,860
125
123
938
4,183
1,500
1,392
54,283
1,526
176
1,051
64,111
1,086
559
588
249
2,027
83
351
4,943
1,670
2,299
20,275
6,507
600
1
1,530
14,755
59
2,892
2,561
571
592
760
4,096
26,286
64,111
Page 73
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
YEAR ENDED DECEMBER 31
(MILLIONS, EXCEPT AS NOTED)
Notes
2023
2022
Revenues ..................................................................................................
28
$
5,038 $
4,711 $
Other income ...........................................................................................
Direct operating costs(1)
...........................................................................
Management service costs .......................................................................
Interest expense .......................................................................................
Share of earnings from equity-accounted investments ............................
Foreign exchange and financial instruments gain (loss) .........................
Depreciation .............................................................................................
Other ........................................................................................................
Income tax recovery (expense)
Current ..................................................................................................
Deferred ................................................................................................
7
8
28
13
19
5
12
9
11
11
671
(1,933)
(205)
(1,627)
186
502
(1,852)
(212)
(128)
176
48
136
(1,434)
(243)
(1,224)
96
(133)
(1,583)
(190)
(148)
150
2
Net income (loss) .....................................................................................
$
616 $
138 $
Net income (loss) attributable to:
Non-controlling interests
2021
4,096
304
(1,365)
(288)
(981)
22
(32)
(1,501)
(307)
(43)
29
(14)
(66)
Participating non-controlling interests – in operating subsidiaries .......
14
$
619 $
334 $
209
General partnership interest in a holding subsidiary held by
Brookfield .........................................................................................
14
Participating non-controlling interests – in a holding subsidiary –
Redeemable/Exchangeable units held by Brookfield .......................
BEPC exchangeable shares ...................................................................
Preferred equity .....................................................................................
Perpetual subordinated notes ................................................................
Preferred limited partners’ equity .........................................................
Limited partners’ equity ..........................................................................
14
14
14
14
15
16
Basic and diluted loss per LP unit ...........................................................
(1)
Direct operating costs exclude depreciation expense disclosed below.
The accompanying notes are an integral part of these consolidated financial statements.
111
(63)
(57)
27
29
41
92
(117)
(104)
26
29
44
(91)
(166)
$
$
616 $
138 $
(0.32) $
(0.60) $
77
(135)
(119)
26
12
55
(191)
(66)
(0.69)
Page 74
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
YEAR ENDED DECEMBER 31
(MILLIONS)
Notes
2023
2022
Net income (loss) .....................................................................................
$
616 $
138 $
Other comprehensive income that will not be reclassified to net
income
Revaluations of property, plant and equipment ..................................
12
Actuarial (loss) gain on defined benefit plans ....................................
Deferred income taxes on above items ...............................................
Unrealized gain (loss) on investments in equity securities .................
Equity-accounted investments ............................................................
Total items that will not be reclassified to net income ............................
Other comprehensive income that may be reclassified to net income
Foreign currency translation .................................................................
Gains (losses) arising during the year on financial instruments
designated as cash-flow hedges ........................................................
Gain (loss) on foreign exchange swaps – net investment hedge ..........
Reclassification adjustments for amounts recognized in net income ...
Deferred income taxes on above items .................................................
Equity-accounted investments ..............................................................
Total items that may be reclassified subsequently to net income ............
Other comprehensive income ..................................................................
11
5
19
10
5
5
5
11
19
2021
(66)
4,573
30
(1,170)
3
184
3,620
(64)
64
43
(2)
(36)
(854)
2,766
2,700
1,317
(647)
(859)
(133)
(12)
81
2
154
92
3,745
21
(852)
(11)
(35)
2,868
252
(128)
(108)
(13)
8
1,328
1,420
175
63
148
(87)
(30)
(378)
2,490
Comprehensive income ...........................................................................
$
2,036 $
2,628 $
Comprehensive income attributable to:
Non-controlling interests
Participating non-controlling interests – in operating subsidiaries ......
General partnership interest in a holding subsidiary held by
14
$
1,983 $
1,582 $
1,048
Brookfield .........................................................................................
14
Participating non-controlling interests – in a holding subsidiary –
Redeemable/Exchangeable units held by Brookfield .......................
14
BEPC exchangeable shares ...................................................................
Preferred equity ....................................................................................
14
Perpetual subordinated notes ................................................................
Preferred limited partners’ equity ............................................................
Limited partners’ equity ..........................................................................
15
16
111
(50)
(45)
39
29
41
(72)
100
270
238
(16)
29
44
381
$
2,036 $
2,628 $
The accompanying notes are an integral part of these consolidated financial statements.
89
444
394
30
12
55
628
2,700
Page 75
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Accumulated other comprehensive income
Non-controlling interests
YEAR ENDED DECEMBER 31
(MILLIONS)
Limited
partners’
equity
Foreign
currency
translation
Revaluation
surplus
Actuarial
losses on
defined
benefit
plans
Cash
flow
hedges
Investments
in equity
securities
Total
limited
partners’
equity
Preferred
limited
partners’
equity
Preferred
equity
Perpetual
subordinated
notes
BEPC
exchangeable
shares
Participating
non-
controlling
interests – in
operating
subsidiaries
General
partnership
interest in a
holding
subsidiary
held by
Brookfield
Participating
non-
controlling
interests – in a
holding
subsidiary –
Redeemable/
Exchangeable
units held by
Brookfield
Total
equity
Balance, as at December 31, 2022 .... $
(1,898) $
(845) $
6,817
$
4
$
Net income (loss) ..............................
Other comprehensive income (loss) ..
Equity issuance (Note 14, 16, 28) .....
LP Units purchased for cancellation
(Note 16) ......................................
Capital contributions (Note 14) .........
Acquisition (Note 3) ..........................
Return of capital ................................
Disposal (Note 4) ..............................
Distributions or dividends declared ..
Distribution reinvestment plan ..........
Ownership changes ...........................
Other ..................................................
Change in year ..................................
(91)
—
390
(43)
—
—
—
12
(383)
8
113
(226)
(220)
—
147
—
—
—
—
—
—
—
—
16
(19)
144
—
(143)
—
—
—
—
—
(12)
—
—
(107)
188
(74)
—
(3)
—
—
—
—
—
—
—
—
—
1
(2)
Balance, as at December 31, 2023 .... $
(2,118) $
(701) $
6,743
$
2
$
17
—
18
—
—
—
—
—
—
—
—
(1)
2
19
36
$
1
$
4,096
$
760
$
571
$
592 $
2,561
$
14,755
$
59
$
2,892
$ 26,286
—
—
—
—
—
—
—
—
—
—
—
—
—
(91)
19
390
(43)
—
—
—
—
41
—
—
—
—
—
—
—
27
12
—
—
—
—
—
—
29
—
—
—
—
—
—
—
(57)
12
240
—
—
—
—
—
619
1,364
—
—
2,993
414
(140)
(449)
111
(63)
—
—
—
—
—
—
—
13
—
—
—
—
—
—
616
1,420
630
(43)
2,993
414
(140)
(449)
(383)
(41)
(27)
(29)
(241)
(1,428)
(116)
(265)
(2,530)
8
21
(54)
(133)
—
—
—
—
—
—
—
12
—
—
—
—
—
—
(36)
(82)
—
—
735
4,108
—
—
1
(4)
—
—
107
(208)
8
21
753
3,693
$
1
$
3,963
$
760
$
583
$
592 $
2,479
$
18,863
$
55
$
2,684
$ 29,979
$
(48) $
4
$
4,092
$
881
$
613
$
592 $
2,562
$
12,303
$
Balance, as at December 31, 2021 .... $
(1,516) $
(842) $
6,494
$
Net income (loss) ..............................
(166)
Other comprehensive income (loss) ..
Equity issuance .................................
Capital contributions .........................
Redemption of Preferred LP Units ....
Disposals ...........................................
Distributions or dividends declared ..
Distribution reinvestment plan ..........
Other ..................................................
Change in year ..................................
—
—
—
—
14
(355)
9
116
(382)
—
(1)
—
—
—
—
—
—
(2)
(3)
—
480
—
—
—
(14)
—
—
(143)
323
Balance, as at December 31, 2022 .... $
(1,898) $
(845) $
6,817
$
—
—
4
—
—
—
—
—
—
—
4
4
—
67
—
—
—
—
—
—
(2)
65
17
$
The accompanying notes are an integral part of these consolidated financial statements.
—
(3)
—
—
—
—
—
—
—
(3)
(166)
547
—
—
—
—
(355)
9
(31)
4
44
—
115
—
(236)
—
(44)
—
—
26
(42) $
—
—
—
—
$
$
$
$
29
—
—
—
—
—
(104)
342
—
—
—
—
334
1,248
—
2,131
—
(75)
(26) $
(29)
(220)
(1,275)
(100)
(250)
(2,299)
—
—
$
$
—
—
—
—
(19)
(1)
—
89
2,452
(121)
(42)
$
1
$
4,096
$
760
$
571
$
592 $
2,561
$
14,755
$
59
92
8
—
—
—
—
$
2,894
$ 23,996
(117)
387
—
—
—
—
138
2,490
115
2,131
(236)
(75)
—
—
—
59
—
(22)
(2)
9
17
2,290
$
2,892
$ 26,286
Page 76
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Accumulated other comprehensive income (loss)
Non-controlling interests
YEAR ENDED DECEMBER 31
(MILLIONS)
Limited
partners’
equity
Foreign
currency
translation
Revaluation
surplus
Actuarial
losses on
defined
benefit
plans
Cash
flow
hedges
Investments
in equity
securities
Total
limited
partners’
equity
Preferred
limited
partners’
equity
Preferred
equity
Perpetual
subordinated
notes
BEPC
exchangeable
shares
Participating
non-
controlling
interests – in
operating
subsidiaries
General
partnership
interest in a
holding
subsidiary
held by
Brookfield
Participating
non-controlling
interests – in a
holding
subsidiary –
Redeemable/
Exchangeable
units held by
Brookfield
Total equity
Balance, as at December 31, 2020 .......... $
(988) $
(720) $
5,595
$
(6) $ (39) $
3
$
3,845
$
1,028
$
609
$
— $
2,408
$
11,100
$
Net income (loss) ....................................
(191)
Other comprehensive income (loss) ........
Issuance of perpetual subordinated notes
Capital contributions ...............................
Redemption of Preferred LP Units ..........
Disposal ...................................................
—
—
—
—
38
Distributions or dividends declared ........
(335)
Distribution reinvestment plan ................
Other ........................................................
Change in year ........................................
9
(49)
(528)
—
(116)
—
—
—
—
—
—
(6)
(122)
—
938
—
—
—
(38)
—
—
(1)
899
—
—
7
—
—
—
—
—
—
(1)
6
(11)
—
—
—
—
—
—
2
(9)
Balance, as at December 31, 2021 .......... $ (1,516) $
(842) $
6,494
$
—
$ (48) $
—
1
—
—
—
—
—
—
—
1
4
The accompanying notes are an integral part of these consolidated financial statements.
(191)
819
—
—
—
—
(335)
9
(55)
247
55
—
—
—
(147)
—
(55)
—
—
(147)
26
4
—
—
—
—
(26)
—
—
4
12
—
592
—
—
—
(12)
—
—
592
(119)
513
—
—
—
—
(209)
—
(31)
154
209
839
—
1,121
—
(395)
(810)
—
239
1,203
56
77
12
—
—
—
—
(85)
—
(1)
3
$
2,721
$
21,767
(135)
579
—
—
—
—
(237)
—
(34)
173
(66)
2,766
592
1,121
(147)
(395)
(1,769)
9
118
2,229
$
4,092
$
881
$
613
$
592 $
2,562
$
12,303
$
59
$
2,894
$
23,996
Page 77
BROOKFIELD RENEWABLE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Notes
2023
2022
2021
$
616 $
138 $
(66)
YEAR ENDED DECEMBER 31
(MILLIONS)
Operating activities
Net income (loss) ..................................................................................................
Adjustments for the following non-cash items:
Depreciation ......................................................................................................
Unrealized foreign exchange and financial instrument (gain) loss ...................
Share of earnings from equity-accounted investments .....................................
Deferred income tax recovery ...........................................................................
Other non-cash items .........................................................................................
Dividends received from equity-accounted investments ..................................
Changes in due to or from related parties .............................................................
Net change in working capital balances ...............................................................
Financing activities
Proceeds from medium-term notes .......................................................................
Commercial paper, net ..........................................................................................
Proceeds from non-recourse borrowings ..............................................................
Repayment of non-recourse borrowings ...............................................................
Capital contributions from participating non-controlling interests – in
operating subsidiaries .......................................................................................
Capital repaid to participating non-controlling interests – in operating
subsidiaries .......................................................................................................
12
5
19
11
19
29
13
13
13
13
14
14
Issuance of equity instruments and related costs .................................................. 14,15,16
Redemption and repurchase of equity instruments
14,15,16
Distributions paid:
To participating non-controlling interests – in operating subsidiaries,
preferred shareholders, preferred limited partners unitholders, and
perpetual subordinate notes .........................................................................
14,15
To unitholders of Brookfield Renewable or BRELP and shareholders of
Brookfield Renewable Corporation .............................................................
14, 16
Borrowings from related party ..............................................................................
Repayments to related party .................................................................................
Investing activities
Acquisitions, net of cash and cash equivalents, in acquired entity .......................
Investment in equity-accounted investments ........................................................
Investment in property, plant and equipment .......................................................
Proceeds from disposal of assets, net of cash and cash equivalents disposed ......
Purchase of financial assets ..................................................................................
Proceeds from financial assets ..............................................................................
Restricted cash and other ......................................................................................
3
19
12
5
Foreign exchange (loss) gain on cash ...................................................................
Cash and cash equivalents increase ......................................................................
Net change in cash classified within assets held for sale ..................................
Balance, beginning of year ................................................................................
Balance, end of year ..........................................................................................
Supplemental cash flow information:
Interest paid .......................................................................................................
Interest received ................................................................................................
Income taxes paid ..............................................................................................
$
$
$
$
The accompanying notes are an integral part of these consolidated financial statements.
1,852
(492)
(186)
(176)
(282)
58
1,390
7
468
1,865
293
(65)
8,316
(6,037)
1,583
258
(96)
(150)
102
89
1,924
(19)
(194)
1,711
296
249
9,547
(6,310)
1,501
122
(22)
(29)
(136)
78
1,448
2
(716)
734
—
(3)
6,877
(3,678)
2,593
1,863
1,200
(248)
630
(43)
(967)
(990)
670
(1,556)
2,596
(791)
(725)
(2,809)
217
(644)
431
(35)
(4,356)
38
143
—
998
1,141 $
1,353 $
112 $
194 $
(75)
115
(252)
(1,372)
(915)
1,470
(1,127)
3,489
(2,452)
(236)
(2,190)
140
(492)
70
94
(5,066)
(28)
106
(8)
900
998 $
1,138 $
37 $
112 $
(511)
592
(153)
(900)
(854)
1,188
(1,615)
2,143
(1,426)
(54)
(1,967)
827
(58)
220
(86)
(2,544)
(35)
298
(5)
607
900
877
45
71
Page 78
BROOKFIELD RENEWABLE PARTNERS L.P.
NOTES TO THE AUDITED ANNUAL CONSOLIDATED FINANCIAL STATEMENTS
The business activities of Brookfield Renewable Partners L.P.
(“Brookfield Renewable”) consist of owning a portfolio of
renewable power and sustainable solution assets primarily in North
America, South America, Europe and Asia-Pacific.
Unless the context indicates or requires otherwise, the term
“Brookfield Renewable” means Brookfield Renewable Partners
L.P. and its controlled entities, including Brookfield Renewable
Corporation (“BEPC”). Unless the context indicates or requires
otherwise, the term “the partnership” means Brookfield Renewable
Partners L.P. and its controlled entities, excluding BEPC.
partnership
(“Redeemable/Exchangeable
Brookfield Renewable’s consolidated equity interests include the
non-voting publicly traded limited partnership units (“LP units”)
held by public unitholders and Brookfield, class A exchangeable
subordinate voting shares (“BEPC exchangeable shares”) of
Brookfield Renewable Corporation (“BEPC”) held by public
shareholders and Brookfield, redeemable/exchangeable partnership
in
units
Brookfield Renewable Energy L.P. (“BRELP”), a holding
subsidiary of Brookfield Renewable, held by Brookfield, and
general partnership interest (“GP interest”) in BRELP held by
Brookfield. Holders of the LP units, Redeemable/Exchangeable
partnership units, GP interest, and BEPC exchangeable shares will
be collectively referred to throughout as “Unitholders” unless the
context indicates or requires otherwise. LP units, Redeemable/
Exchangeable partnership units, GP
interest, and BEPC
exchangeable shares will be collectively referred to throughout as
"Units", or as "per Unit", unless the context indicates or requires
otherwise.
units”)
Brookfield Renewable is a publicly traded limited partnership
established under the laws of Bermuda pursuant to an amended and
restated limited partnership agreement dated November 20, 2011
as thereafter amended from time to time.
The registered office of Brookfield Renewable is 73 Front Street,
Fifth Floor, Hamilton HM12, Bermuda.
The immediate parent of Brookfield Renewable is its general
partner, Brookfield Renewable Partners Limited (“BRPL”). The
ultimate parent of Brookfield Renewable is Brookfield Corporation
(“Brookfield Corporation”). Brookfield Corporation and
its
subsidiaries, other than Brookfield Renewable, and unless the
context otherwise requires, includes Brookfield Asset Management
Ltd (“Brookfield Asset Management”), are also individually and
collectively referred
these financial
to as “Brookfield”
statements. The term “Brookfield Holders” means Brookfield,
Brookfield Reinsurance and their related parties.
in
The BEPC exchangeable shares are traded under the symbol
“BEPC” on the New York Stock Exchange and the Toronto Stock
Exchange.
under
The LP units are traded under the symbol “BEP” on the New York
Stock Exchange and under the symbol “BEP.UN” on the Toronto
Stock Exchange. Brookfield Renewable's Class A Series 7, Series
13, Series 15, and Series 18 preferred limited partners’ equity are
traded
“BEP.PR.M”,
“BEP.PR.O”, and “BEP.PR.R”, respectively, on the Toronto Stock
Exchange. Brookfield Renewable's Class A Series 17 preferred
limited partners’ equity is traded under the symbol “BEP.PR.A” on
the New York Stock Exchange. The perpetual subordinated notes
are traded under the symbol “BEPH” and “BEPI” on the New
York Stock Exchange.
“BEP.PR.G”,
symbols
the
Notes to consolidated financial statements
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
31.
Basis of preparation and material accounting
policy information
Principal subsidiaries
Acquisitions
Disposal of assets
Risk management and financial instruments
Segmented information
Other income
Direct operating costs
Other
Foreign currency translation
Income taxes
Property, plant and equipment, at fair value
Borrowings
Non-controlling interests
Preferred limited partners’ equity
Limited partners’ equity
Goodwill
Capital management
Equity-accounted investments
Cash and cash equivalents
Restricted cash
Trade receivables and other current assets
Other long-term assets
Accounts payable and accrued liabilities
Provisions
Other long-term liabilities
Commitments, contingencies and guarantees
Related party transactions
Supplemental information
Subsidiary public issuers
Subsequent events
Page
79
95
95
104
104
115
121
122
122
122
123
125
128
132
138
138
139
140
142
143
143
144
144
145
145
146
146
148
154
155
156
Page 79
1. BASIS OF PREPARATION AND MATERIAL ACCOUNTING POLICY INFORMATION
(a) Statement of compliance
The consolidated financial statements have been prepared in accordance with International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The accounting policies
used in the consolidated financial statements are based on the IFRS applicable as at December 31, 2023, which
encompass individual IFRS, International Accounting Standards (“IAS”), and interpretations made by the
International Financial Reporting Interpretations Committee (“IFRIC”) and the Standard Interpretations Committee
(“SIC”). The policies set out below are consistently applied to all periods presented, unless otherwise noted.
These consolidated financial statements have been authorized for issuance by the Board of Directors of Brookfield
Renewable’s general partner, BRPL, on February 29, 2024.
Certain comparative figures have been reclassified to conform to the current year’s presentation.
References to $, C$, €, £, R$, COP, INR, and CNY are to United States (“U.S.”) dollars, Canadian dollars, Euros,
British pound, Brazilian reais, Colombian pesos, Indian rupees, and Chinese yuan, respectively.
All figures are presented in millions of U.S. dollars unless otherwise noted.
(b) Basis of preparation
The consolidated financial statements have been prepared on the basis of historical cost, except for the revaluation of
property, plant and equipment and certain assets and liabilities which have been measured at fair value. Cost is
recorded based on the fair value of the consideration given in exchange for assets.
(c) Consolidation
These consolidated financial statements include the accounts of Brookfield Renewable and its subsidiaries, which
are the entities over which Brookfield Renewable has control. An investor controls an investee when it is exposed,
or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns
through its power over the investee. Non-controlling interests in the equity of Brookfield Renewable’s subsidiaries
are shown separately in equity in the consolidated statements of financial position.
Brookfield Renewable has entered into a voting agreement with Brookfield, which provides Brookfield Renewable
with control of the general partner of BRELP. Accordingly, Brookfield Renewable consolidates the accounts of
BRELP and its subsidiaries. In addition, BRELP issued redeemable/exchangeable limited partnership units to
Brookfield (“Redeemable/Exchangeable partnership units”), pursuant to which the holder may, at its request, require
BRELP to redeem the Redeemable/Exchangeable partnership units for cash consideration. This right is subject to
Brookfield Renewable’s right of first refusal which entitles it, at its sole discretion, to elect to acquire all of the
Redeemable/Exchangeable partnership units so presented to BRELP that are tendered for redemption in exchange
for LP units on a one-for-one basis. As Brookfield Renewable, at its sole discretion, has the right to settle the
obligation with LP units, the Redeemable/Exchangeable partnership units are classified as equity of Brookfield
Renewable (“Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable Units
held by Brookfield”).
Brookfield Renewable has entered into voting agreements with Brookfield, whereby Brookfield Renewable gained
control of the entities that own certain renewable power generating operations. Brookfield Renewable has also
entered into a voting agreement with its consortium partners in respect of its Colombian operations. These voting
agreements provide Brookfield Renewable the authority to direct the election of the Boards of Directors of the
relevant entities, among other things, and therefore provide Brookfield Renewable with control. Accordingly,
Brookfield Renewable consolidates the accounts of these entities. Refer to Note 28 – Related party transactions for
further information.
For entities previously controlled by Brookfield Corporation, the voting agreements entered into do not represent
business combinations in accordance with IFRS 3, Business Combinations (“IFRS 3”), as all combining businesses
are ultimately controlled by Brookfield Corporation both before and after the transactions were completed.
Brookfield Renewable accounts for these transactions involving entities under common control in a manner similar
to a pooling of interest, which requires the presentation of pre-voting agreement financial information as if the
Page 80
transactions had always been in place. Refer to Note 1(s)(ii) – Critical judgments in applying accounting policies –
Common control transactions for Brookfield Renewable’s policy on accounting for transactions under common
control.
Equity-accounted investments
Equity-accounted investments are entities over which Brookfield Renewable has significant influence or joint
arrangements representing joint ventures. Significant influence is the ability to participate in the financial and
operating policy decisions of the investee, but without controlling or jointly controlling those investees. Such
investments are accounted for using the equity method.
A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have
rights to the net assets of the joint venture. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties
sharing control. Brookfield Renewable accounts for its interests in joint ventures using the equity method.
Under the equity method, the carrying value of an interest in an investee is initially recognized at cost and adjusted
for Brookfield Renewable’s share of net income, other comprehensive income (“OCI”), distributions by the equity-
accounted investment and other adjustments to Brookfield Renewable’s proportionate interest in the investee.
(d) Foreign currency translation
All figures reported in the consolidated financial statements and tabular disclosures to the consolidated financial
statements are reflected in millions of U.S. dollars, which is the functional currency of Brookfield Renewable. Each
of the foreign operations included in these consolidated financial statements determines its own functional currency,
and items included in the financial statements of each subsidiary are measured using that functional currency.
Assets and liabilities of foreign operations having a functional currency other than the U.S. dollar are translated at
the rate of exchange prevailing at the reporting date and revenues and expenses at the rate of exchange prevailing at
the dates of the transactions during the period. Gains or losses on translation of foreign subsidiaries are included in
OCI. Gains or losses on foreign currency denominated balances and transactions that are designated as hedges of net
investments in these operations are reported in the same manner.
In preparing the consolidated financial statements of Brookfield Renewable, foreign currency denominated
monetary assets and liabilities are translated into the functional currency using the closing rate at the applicable
consolidated statement of financial position dates. Non-monetary assets and liabilities denominated in a foreign
currency and measured at fair value are translated at the rate of exchange prevailing at the date when the fair value
was determined and non-monetary assets and liabilities measured at historical cost are translated at the historical
rate. Revenues and expenses are measured in the functional currency at the rates of exchange prevailing at the dates
of the transactions with gains or losses included in income.
(e) Cash and cash equivalents
Cash and cash equivalents include cash, term deposits and money market instruments with original maturities of less
than 90 days.
(f) Restricted cash
Restricted cash includes cash and cash equivalents, where the availability of funds is restricted primarily by credit
and construction agreements.
(g) Property, plant and equipment and revaluation method
Power generating assets are classified as property, plant and equipment and are accounted for using the revaluation
method under IAS 16 – Property, Plant and Equipment (“IAS 16”). Property, plant and equipment are initially
measured at cost and subsequently carried at their revalued amount, being the fair value at the date of the
revaluation, less any subsequent accumulated depreciation and any subsequent accumulated impairment losses.
Brookfield Renewable generally determines the fair value of its property, plant and equipment by using 20-year
discounted cash flow model for hydroelectric assets and the estimated remaining useful life for other technologies.
This model incorporates future cash flows from long-term power purchase agreements that are in place where it is
Page 81
determined that the power purchase agreements are linked specifically to the related power generating assets. The
model also includes estimates of future electricity prices, anticipated long-term average generation, estimated
operating and capital expenditures, terminal values and assumptions about future inflation rates and discount rates
by geographical location. Construction work-in-progress (“CWIP”) is revalued when sufficient information exists to
determine fair value using the discounted cash flow method. Revaluations are made on an annual basis as at
December 31 to ensure that the carrying amount does not differ significantly from fair value. For power generating
assets acquired through business combinations, Brookfield Renewable initially measures the assets at fair value on
the acquisition date, consistent with the policy described in Note 1(o) – Business combinations, with no revaluation
at year-end in the year of acquisition unless there is external evidence specific to those assets that would indicate the
carrying value of the asset has either increased or decreased materially.
Where the carrying amount of an asset increased as a result of a revaluation, the increase is recognized in income to
the extent the increase reverses a previously recognized decrease recorded through income, with the remainder of the
increase recognized in OCI and accumulated in equity under revaluation surplus and non-controlling interest. When
the carrying amount of an asset decreases, the decrease is recognized in OCI to the extent that a balance exists in
revaluation surplus with respect to the asset, with the remainder of the decrease recognized in income.
Depreciation on power generating assets is calculated on a straight-line basis over the estimated service lives of the
assets, which are as follows:
Dams ....................................................................................................................................................
Penstocks ..............................................................................................................................................
Powerhouses ........................................................................................................................................
Hydroelectric generating units .............................................................................................................
Wind generating units ..........................................................................................................................
Solar generating units ..........................................................................................................................
Gas-fired cogenerating (“Cogeneration”) units ...................................................................................
Other assets ..........................................................................................................................................
Estimated service lives
Up to 115 years
Up to 60 years
Up to 115 years
Up to 115 years
Up to 30 years
Up to 35 years
Up to 40 years
Up to 60 years
Costs are allocated to significant components of property, plant and equipment. When items of property, plant and
equipment have different useful lives, they are accounted for as separate items (significant components) and
depreciated separately. To ensure the accuracy of useful lives and residual values, a review is conducted annually.
Depreciation is calculated based on the fair value of the asset less its residual value. Depreciation commences when
the asset is in the location and conditions necessary for it to be capable of operating in the manner intended by
management. It ceases at the earlier of the date the asset is classified as held-for-sale and the date the asset is
derecognized. An item of property, plant and equipment and any significant component is derecognized upon
disposal or when no future economic benefits are expected from its use. Other assets include equipment, buildings
and leasehold improvements. Buildings, furniture and fixtures, leasehold improvements and office equipment are
recorded at historical cost, less accumulated depreciation. Land and CWIP are not subject to depreciation.
The depreciation of property, plant and equipment in Brazil is based on the duration of the authorization or the
useful life of a concession asset. The weighted-average remaining duration at December 31, 2023 is 34 years (2022:
35 years). Since land rights are part of the concession or authorization, this cost is also subject to depreciation.
Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset,
and the net amount is applied to the revalued amount of the asset.
Gains and losses on disposal of an item of property, plant and equipment of operating assets are recognized in Other
income and Other in the consolidated statements of income (loss), respectively. The revaluation surplus is
reclassified within the respective components of equity and not reclassified to net income when the assets are
disposed.
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(h) Leases
At inception of a contract, Brookfield Renewable assesses whether a contract is, or contains, a lease. A contract is,
or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in
exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset,
Brookfield Renewable assesses whether:
•
•
the contract specified explicitly or implicitly the use of an identified asset, and that is physically distinct or
represents substantially all of the capacity of a physically distinct asset. If the supplier has a substantive
substitution right, then the asset is not identified;
Brookfield Renewable has the right to obtain substantially all of the economic benefits from use of the asset
throughout the period of use; and Brookfield Renewable has the right to direct the use of the asset.
Brookfield Renewable has this right when it has the decision-making rights that are most relevant to
changing how and for what purpose the asset is used. In rare cases where the decisions about how and for
what purpose the asset is used are predetermined, Brookfield Renewable has the right to direct the use of
the asset if either:
◦
◦
Brookfield Renewable has the right to operate the asset (or to direct others to operate the asset in a
manner that it determines) throughout the period of use, without the supplier having the right to
change those operating instructions; or
Brookfield Renewable designed the asset in a way that predetermines how and for what purpose it
will be used.
At inception or on reassessment of a contract that contains a lease component, Brookfield Renewable allocates the
consideration in the contract to each lease component on the basis of their relative stand-alone prices. However, for
the leases of land and buildings in which it is a lessee, Brookfield Renewable has elected not to separate non-lease
components and, therefore, accounts for the lease and non-lease components as a single lease component.
Brookfield Renewable recognizes a right-of-use asset and a lease liability at the lease commencement date. The
right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for
any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate
of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is
located, less any lease incentives received.
The right-of use asset is subsequently depreciated using the straight-line method from the commencement date to the
earlier of the end of the useful lives of the right-of-use asset or the end of the lease term. The estimated useful lives
of right-of-use assets are determined on the same basis as those of property, plant and equipment. In addition, the
right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of
the lease liability.
The lease liability is initially measured at the present value of the lease payments that are not paid at the
commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily
determined, Brookfield Renewable’s incremental borrowing rate. Generally, Brookfield Renewable uses its
incremental borrowing rate as the discount rate.
Lease payments included in the measurement of the lease liability comprise the following:
•
•
•
•
Fixed payments, including in-substance fixed payments;
Variable lease payments that depend on an index or a rate, initially measured using the index or rate as at
the commencement date;
Amounts expected to be payable under a residual value guarantee; and
The exercise price under a purchase option that Brookfield Renewable is reasonably certain to exercise,
lease payments in an optional renewable period if Brookfield Renewable is reasonably certain to exercise
an extension option, and penalties for early termination of a lease unless Brookfield Renewable is
reasonably certain not to terminate early
The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a
change in future lease payments arising from a change in an index or rate, if there is a change in Brookfield
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Renewable’s estimate of the amount expected to be payable under a residual value guarantee, or if Brookfield
Renewable changes its assessment of whether it will exercise a purchase, extension or termination option.
When the lease liability is remeasured in this way, a corresponding adjustment is made either to the carrying amount
of the right-of-use asset or, when the adjustment is a reduction to the right-of-use asset, is recorded in the
consolidated statements of income (loss) if the carrying amount of the right-of-use asset has been reduced to nil.
Brookfield Renewable presents right-of-use assets in property, plant and equipment and lease liabilities in other
long-term liabilities in the consolidated statements of financial position.
Brookfield Renewable has elected not to recognize right-of-use assets and lease liabilities for short-term leases that
have a lease term of twelve months or less and leases of low-value assets. Brookfield Renewable recognizes the
lease payments associated with these leases as an expense on a straight-line basis over the lease term.
(i) Goodwill
Goodwill represents the excess of the price paid for the acquisition of an entity over the fair value of the net tangible
and intangible assets and liabilities acquired. Goodwill is allocated to the cash generating unit or units (“CGU”) to
which it relates. Brookfield Renewable identifies CGU as identifiable groups of assets that are largely independent
of the cash inflows from other assets or groups of assets.
Goodwill is evaluated for impairment annually or more often if events or circumstances indicate there may be
impairment. Impairment is determined for goodwill by assessing if the carrying value of a CGU, including the
allocated goodwill, exceeds its recoverable amount determined as the greater of the estimated fair value less costs of
disposal or the value in use. Impairment losses recognized in respect of a CGU are first allocated to the carrying
value of goodwill and any excess is allocated to the carrying amount of assets in the CGU. Any goodwill impairment
is charged to profit or loss in the period in which the impairment is identified. Impairment losses on goodwill are not
subsequently reversed. In the year of a business acquisition, the recoverability of the acquired goodwill is assessed
by revisiting the assumptions of the related underwriting model.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gain or loss
on disposal of the operation.
(j) Asset impairment
At each statement of financial position date, Brookfield Renewable assesses whether for non-financial assets there is
any indication that such assets are impaired. This assessment includes a review of internal and external factors which
includes, but is not limited to, changes in the technological, political, economic or legal environment in which the
entity operates in, structural changes in the industry, changes in the level of demand, physical damage and
obsolescence due to technological changes. An impairment is recognized if the recoverable amount, determined as
the higher of the estimated fair value less costs of disposal or the discounted future cash flows generated from use
and eventual disposal from an asset or CGU is less than its carrying value.
For non-financial assets (including equity-accounted investments), an impairment is recognized if the recoverable
amount, determined as the greater of the estimated fair value, less costs to sell, and the discounted future cash flows
generated from use and eventual disposal of an asset or CGU, is less than its carrying value. The projections of
future cash flows take into account the relevant operating plans and management’s best estimate of the most
probable set of conditions anticipated to prevail. Where an impairment loss subsequently reverses, the carrying
amount of the asset or CGU is increased to the lesser of the revised estimate of recoverable amount and the carrying
amount that would have been recorded had no impairment loss been recognized previously.
(k) Trade receivables and other current assets
Trade receivables and other current assets are recognized initially at fair value, and subsequently measured at
amortized cost using the effective interest method, less any provision for expected credit losses.
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(l) Financial instruments
Initial recognition
Under IFRS 9 – Financial Instruments (“IFRS 9”), regular purchases and sales of financial assets are recognized on
the trade date, being the date on which Brookfield Renewable commits to purchase or sell the asset. Financial assets
are derecognized when the rights to receive cash flows from the financial assets have expired or have been
transferred and Brookfield Renewable has transferred substantially all the risks and rewards of ownership.
At initial recognition, Brookfield Renewable measures a financial asset at its fair value. In the case of a financial
asset not categorized as fair value through profit and loss (“FVPL”), transaction costs that are directly attributable to
the acquisition of the financial asset are included at initial recognition. Transaction costs of financial assets carried at
FVPL are expensed in income.
Classification and measurement
Subsequent measurement of financial assets depends on Brookfield Renewable’s business objective for managing
the asset and the cash flow characteristics of the asset. There are three measurement categories into which
Brookfield Renewable classifies its financial assets:
Amortized cost – Financial assets held for collection of contractual cash flows that represent solely payments of
principal and interest are measured at amortized cost. Interest income is recognized as other income in the financial
statements, and gains/losses are recognized in income when the asset is derecognized or impaired.
FVOCI – Financial assets held to achieve a particular business objective other than short-term trading are designated
at fair value through other comprehensive income (“FVOCI”). For equity instruments designated at FVOCI, there is
no recycling of gains or losses through income. Upon derecognition of the asset, accumulated gains or losses are
transferred from OCI directly to retained earnings.
FVPL – Financial assets that do not meet the criteria for amortized cost or FVOCI are measured at FVPL. Gains or
losses on these types of assets are recognized in income.
Brookfield Renewable assesses on a forward-looking basis the expected credit losses (“ECL”) associated with its
assets carried at amortized cost and FVOCI. For trade receivables and contract assets, Brookfield Renewable applied
the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognized from initial
recognition of the asset. The simplified approach to the recognition of ECL does not require entities to track the
changes in credit risk; rather, entities recognize a loss allowance at each reporting date based on the lifetime ECL
since the date of initial recognition of the asset.
Evidence of impairment may include:
•
•
•
•
Indications that a debtor or group of debtors is experiencing significant financial difficulty;
A default or delinquency in interest or principal payments;
Probability that a debtor or a group of debtors will enter into bankruptcy or other financial reorganization;
Changes in arrears or economic conditions that correlate with defaults, where observable data indicates that
there is a measurable decrease in the estimated future cash flows.
Trade receivables and contract assets are reviewed qualitatively on a case-by-case basis to determine if they need to
be written off.
ECL are measured as the difference in the present value of the contractual cash flows that are due under contract and
the cash flows expected to be received. ECL is measured by considering the risk of default over the contract period
and incorporates forward looking information into its measurement.
Financial liabilities are classified as financial liabilities at fair value through profit and loss, amortized cost, or
derivatives designated as hedging instruments in an effective hedge. Brookfield Renewable determines the
classification of its financial liabilities at initial recognition. Brookfield Renewable’s financial liabilities include
accounts payable and accrued liabilities, corporate borrowings, non-recourse borrowings, derivative liabilities, due
to related party balances, and tax equity. Financial liabilities are initially measured at fair value, with subsequent
measurement determined based on their classification as follows:
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FVPL – Financial liabilities held for trading, such as those acquired for the purpose of selling in the near term,
derivative financial instruments entered into by Brookfield Renewable that do not meet hedge accounting criteria,
and tax equity are classified as fair value through profit and loss. Gains or losses on these types of liabilities are
recognized in income.
Brookfield Renewable owns and operates certain projects in the U.S. under tax equity structures to finance the
construction of utility-scale solar and wind projects. Such structures are designed to allocate renewable tax
incentives, such as investment tax credits (“ITCs”), production tax credits (“PTCs”) and accelerated tax
depreciation, to tax equity investors. Generally, tax equity structures grant the tax equity investors the majority of
the project's U.S. taxable earnings and renewable tax incentives, along with a smaller portion of the projects’ cash
flows, until a contractually determined point at which the allocations are adjusted (the “Flip Point”). Subsequent to
the Flip Point the majority of the project’s U.S. taxable earnings, renewable tax incentives and cash flows are
allocated to the sponsor. The Flip Point dates are generally dependent on the underlying projects’ reaching an agreed
upon after tax investment return, however, from time to time, the Flip Point dates may be dates specified within the
contract. At all times, both before and after the projects’ Flip Point, Brookfield Renewable retains control over the
projects financed with a tax equity structure. In accordance with the substance of the contractual agreements, the
amounts paid by the tax equity investors for their equity stakes are classified as financial instrument liabilities on the
consolidated statements of financial position and at each reporting date are remeasured to their fair value in
accordance with IFRS 9.
The fair value of the tax equity financing is generally comprised of the following elements:
Elements affecting the fair value of the tax equity financing
Production tax credits (PTCs)
Investment tax credits (ITCs)
Taxable loss, including tax attributes such as accelerated tax
depreciation
Pay-go contributions
Cash distributions
Description
Allocation of PTCs to the tax equity investor are derived
from the power generated during the period. The PTCs are
recognized in foreign exchange and financial instrument
gain (loss) with a corresponding reduction to the tax equity
liability.
Allocation of ITCs to the tax equity investor are derived as
a percentage of a projects total cost. Once received, the
ITCs are recognized as a reduction to property, plant and
equipment with a corresponding reduction to the tax equity
liability.
Under the terms of the tax equity agreements, Brookfield
Renewable is required to allocate specified percentages of
taxable losses to the tax equity investor. As amounts are
allocated, the obligation to deliver them is satisfied and a
reduction to the tax equity liability is recorded with a
corresponding amount recorded within foreign exchange
and financial instrument gain (loss) on the consolidated
statements of income (loss).
Certain of
the contracts contain annual production
thresholds. When the thresholds are exceeded, the tax
equity investor is required to contribute additional cash
amounts. The cash amounts paid increase the value of the
tax equity liability.
Certain of the contracts also require cash distributions to the
tax equity investor. Upon payment, the tax equity liability is
reduced in the amount of the cash distribution.
Amortized cost – All other financial liabilities are classified as amortized cost using the effective interest rate
method. Gains and losses are recognized in income when the liabilities are derecognized as well as through the
amortization process. Remeasurement gains and losses on financial liabilities classified as amortized cost are
presented in the consolidated statements of income (loss). Amortized cost is computed using the effective interest
method less any principal repayment or reduction. The calculation takes into account any premium or discount on
acquisition and includes transaction costs and fees that are an integral part of the effective interest rate. This category
includes trade and other payables, dividends payable, interest-bearing loans and borrowings, and corporate credit
facilities.
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Derivatives and hedge accounting
Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently
remeasured to their fair value at the end of each reporting period. The accounting for subsequent changes in fair
value depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being
hedged and the type of hedge relationship designated.
Brookfield Renewable designates its derivatives as hedges of:
•
•
•
•
Foreign exchange risk associated with the cash flows of highly probable forecast transactions (cash flow
hedges);
Foreign exchange risk associated with net investment in foreign operations (net investment hedges);
Commodity price risk associated with cash flows of highly probable forecast transactions (cash flow
hedges); and
Floating interest rate risk associated with floating rate debts (cash flow hedges).
At the inception of a hedge relationship, Brookfield Renewable formally designates and documents the hedge
relationship to which it wishes to apply hedge accounting and the risk management objective and strategy for
undertaking the hedge.
A hedging relationship qualifies for hedge accounting if it meets all of the following effectiveness requirements:
•
•
•
There is an ‘economic relationship’ between the hedged item and the hedging instrument;
The effect of credit risk does not ‘dominate the value changes’ that result from that economic relationship;
and
The hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged
item that Brookfield Renewable actually hedges and the quantity of the hedging instrument that Brookfield
Renewable actually uses to hedge that quantity of hedged item.
The fair values of various derivative financial instruments used for hedging purposes and movements in the hedge
reserve within equity are shown in Note 5 – Risk management and financial instruments.
When a hedging instrument expires, is sold, is terminated, or no longer meets the criteria for hedge accounting, any
cumulative deferred gain or loss and deferred costs of hedging in equity at that time remain in equity until the
forecasted transaction occurs. When the forecasted transaction is no longer expected to occur, the cumulative gain or
loss and deferred costs of hedging are immediately reclassified to income.
If the hedge ratio for risk management purposes is no longer optimal but the risk management objective remains
unchanged and the hedge continues to qualify for hedge accounting, the hedge relationship will be rebalanced by
adjusting either the volume of the hedging instrument or the volume of the hedged item so that the hedge ratio aligns
with the ratio used for risk management purposes. Any hedge ineffectiveness is calculated and accounted for in
income at the time of the hedge relationship rebalancing.
(i) Cash flow hedges that qualify for hedge accounting
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges
is recognized in the cash flow hedge reserve within equity, limited to the cumulative change in fair value of the
hedged item on a present value basis from the inception of the hedge. The gain or loss relating to the ineffective
portion is recognized immediately in income, within foreign exchange and financial instruments gain (loss).
Gains and losses relating to the effective portion of the change in fair value of the entire forward contract are
recognized in the cash flow hedge reserve within equity. Amounts accumulated in equity are reclassified in the
period when the hedged item affects income.
(ii) Net investment hedges that qualify for hedge accounting
Hedges of net investments in foreign operations are accounted for similarly to cash flow hedges. Any gain or loss on
the hedging instrument relating to the effective portion of the hedge is recognized in OCI and accumulated in
reserves in equity. The gain or loss relating to the ineffective portion is recognized immediately in income within
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foreign exchange and financial instruments gain (loss). Gains and losses accumulated in equity will be reclassified to
income when the foreign operation is partially disposed of or sold.
(iii) Hedge ineffectiveness
Brookfield Renewable’s hedging policy only allows for the use of derivative instruments that form effective hedge
relationships. Sources of hedge effectiveness are determined at the inception of the hedge relationship and measured
through periodic prospective effectiveness assessments to ensure that an economic relationship exists between the
hedged item and hedging instrument. Where the critical terms of the hedging instrument match exactly with the
terms of the hedged item, a qualitative assessment of effectiveness is performed. For other hedge relationships, the
hypothetical derivative method to assess effectiveness is used.
(m) Revenue and expense recognition
The majority of revenue is derived from the sale of power and power related ancillary services both under contract
and in the open market, sourced from Brookfield Renewable’s power generating facilities. The obligations are
satisfied over time as the customer simultaneously receives and consumes benefits as Brookfield Renewable delivers
electricity and related products. Revenue is recorded based upon the output delivered and capacity provided at rates
specified under either contract terms or prevailing market rates. The revenue reflects the consideration Brookfield
Renewable expects to be entitled to in exchange for those goods or services. Costs related to the purchases of power
or fuel are recorded upon delivery. All other costs are recorded as incurred.
Details of the revenue recognized per geographical region and technology are included in Note 6 – Segmented
information.
Where available, Brookfield Renewable has elected the practical expedient available under IFRS 15 – Revenue from
contracts with customers (“IFRS 15”) for measuring progress toward complete satisfaction of a performance
obligation and for disclosure requirements of remaining performance obligations. The practical expedient allows an
entity to recognize revenue in the amount to which the entity has the right to invoice such that the entity has a right
to the consideration in an amount that corresponds directly with the value to the customer for performance
completed to date by the entity.
If the consideration in a contract that does not apply the practical expedient available under IFRS 15 for measuring
progress toward complete satisfaction of a performance obligation includes a variable amount, Brookfield
Renewable estimates the amount of consideration to which it will be entitled in exchange for transferring the goods
to the customer. The variable consideration is estimated at contract inception and constrained until it is highly
probable that a significant revenue reversal in the amount of cumulative revenue recognized will not occur when the
associated uncertainty with the variable consideration is subsequently resolved.
Brookfield Renewable also sells power and related products under bundled arrangements. Energy, capacity and
renewable credits within power purchase agreements are considered to be distinct performance obligations. A
contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or
as, the performance obligation is satisfied under IFRS 15. Brookfield Renewable views the sale of energy and
capacity as a series of distinct goods that is substantially the same and has the same pattern of transfer measured by
the output method. Brookfield Renewable views renewable credits to be performance obligations satisfied at a point
in time. During the year ended December 31, 2023, revenues recognized at a point in time corresponding to the sale
of renewable credits were $250 million (2022: $263 million and 2021: $183 million). Measurement of satisfaction
and transfer of control to the customer of renewable credits in a bundled arrangement coincides with the pattern of
revenue recognition of the underlying energy generation.
Revenues recognized that are outside the scope of IFRS 15 include realized gains and losses from derivatives used in
the risk management of Brookfield Renewable's generation activities related to commodity prices. From time to
time, Brookfield Renewable also enters into commodity contracts to hedge all or a portion of its estimated revenue
stream when selling electricity to an independent system operated market and there is no PPA available. These
commodity contracts require periodic settlements in which Brookfield Renewable receives a fixed-price based on
specified quantities of electricity and pays the counterparty a variable market price based on the same specified
quantity of electricity. As these derivatives are accounted for under hedge accounting, the changes in fair value are
recorded in revenues in the consolidated statements of income (loss). Financial transactions included in revenues for
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the year ended December 31, 2023 decreased revenues by $119 million (decreased by 2022: 146 million and 2021:
$37 million).
Contract Balances
Contract assets – A contract asset is the right to consideration in exchange for goods or services transferred to the
customer. If Brookfield Renewable performs by transferring goods or services to a customer before the customer
pays consideration or before payment is due, a contract asset is recognized for the earned consideration that is
conditional.
Trade receivables – A receivable represents Brookfield Renewable’s right to an amount of consideration that is
unconditional (i.e., only the passage of time is required before payment of the consideration is due).
Contract liabilities – A contract liability is the obligation to transfer goods or services to a customer for which
Brookfield Renewable has received consideration (or an amount of consideration is due) from the customer. If a
customer pays consideration before Brookfield Renewable transfers goods or services to the customer, a contract
liability is recognized when the payment is made or the payment is due (whichever is earlier). Contract liabilities are
recognized as revenue when Brookfield Renewable performs under the contract.
(n) Income taxes
Current income tax assets and liabilities are measured at the amount expected to be paid to tax authorities, net of
recoveries, based on the tax rates and laws enacted or substantively enacted at the statement of financial position
dates. Current income tax assets and liabilities are included in trade receivables and other current assets and accounts
payable and accrued liabilities, respectively.
Deferred tax is recognized on taxable temporary differences between the tax basis and the carrying amounts of
assets and liabilities. Deferred tax is not recognized if the temporary difference arises from goodwill or from initial
recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither
taxable profit nor accounting profit. Deferred income tax assets are recognized for all deductible temporary
differences, carry forwards of unused tax credits and unused tax losses, to the extent that it is probable that
deductions, tax credits and tax losses can be utilized. The carrying amount of deferred income tax assets is reviewed
at each statement of financial position date and reduced to the extent it is no longer probable that the income tax
assets will be recovered. Deferred income tax assets and liabilities are measured at the tax rates that are expected to
apply to the year when the assets are realized or the liabilities settled, using the tax rates and laws enacted or
substantively enacted at the statement of financial position dates.
Current and deferred income taxes relating to items recognized directly in OCI are also recognized directly in OCI.
(o) Business combinations
The acquisition of a business is accounted for using the acquisition method. The consideration for an acquisition is
measured at the aggregate of the fair values, at the date of exchange, of the assets transferred, the liabilities incurred
to former owners of the acquired business, and equity instruments issued by the acquirer in exchange for control of
the acquired business. The acquired business’ identifiable assets, liabilities and contingent liabilities that meet the
conditions for recognition under IFRS 3 – Business combinations (“IFRS 3”), are recognized at their fair values at
the acquisition date, except for income taxes which are measured in accordance with IAS 12 – Income taxes (“IAS
12”), share-based payments which are measured in accordance with IFRS 2 – Share-based payment, liabilities and
contingent liabilities which are measured under IAS 37 - Provisions, contingent liabilities and contingent assets or
IFRIC 21 - Levies and non-current assets that are classified as held-for-sale which are measured at fair value less
costs to sell in accordance with IFRS 5 – Non-current assets held for sale and discontinued operations. The non-
controlling interest in the acquiree is initially measured at the non-controlling interest’s proportion of the net fair
value of the identifiable assets, liabilities and contingent liabilities recognized or when applicable, at the fair value of
the shares outstanding.
To the extent that the aggregate of the fair value of consideration paid, the amount of any non-controlling interest
and the fair value of any previously held interest in the acquiree exceeds the fair value of the net identifiable tangible
and intangible assets acquired, goodwill is recognized. To the extent that this difference is negative, the amount is
recognized as a gain in income. Goodwill is not amortized and is not deductible for tax purposes. However, after
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initial recognition, goodwill will be measured at cost less any accumulated impairment losses. An impairment
assessment will be performed at least annually, and whenever circumstances such as significant declines in expected
revenues, earnings or cash flows indicate that it is more likely than not that goodwill might be impaired. Goodwill
impairment charges are not reversible.
When a business combination is achieved in stages, previously held interests in the acquired entity are re-measured
to fair value at the acquisition date, which is the date control is obtained, and the resulting gain or loss, if any, is
recognized in income. Amounts arising from interests in the acquired business prior to the acquisition date that have
previously been recognized in OCI are reclassified to income. Upon disposal or loss of control of a subsidiary, the
carrying amount of the net assets of the subsidiary (including any OCI relating to the subsidiary) are derecognized
with the difference between any proceeds received and the carrying amount of the net assets recognized as a gain or
loss in income.
Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent
consideration arrangement, measured at its acquisition-date fair value. Subsequent changes in fair values are
adjusted against the cost of the acquisition where they qualify as measurement period adjustments. All other
subsequent changes in the fair value of contingent consideration classified as liabilities will be recognized in the
consolidated statements of income (loss), whereas changes in the fair values of contingent consideration classified
within equity are not subsequently re-measured.
(p) Assets held for sale
Assets and disposal groups are classified as held for sale if their carrying amount will be recovered principally
through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is
highly probable and the non-current asset or disposal group is available for immediate sale in its present condition.
Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale
within one year from the date of classification subject to limited exceptions.
When Brookfield Renewable is committed to a sale plan involving loss of control of a subsidiary, all of the assets
and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless
of whether Brookfield Renewable will retain a non-controlling interest in its former subsidiary after the sale.
Non-current assets and disposal groups classified as held for sale are measured at the lower of their previous
carrying amount and fair value less costs to sell.
Assets classified as held for sale and the assets of a disposal group are presented separately from other assets in the
consolidated statements of financial position and are classified as current. The liabilities of a disposal group
classified as held for sale are presented separately from other liabilities in the consolidated statements of financial
position and are classified as current.
Once classified as held for sale, property, plant and equipment and intangible assets are not depreciated or
amortized.
(q) Other items
(i) Capitalized costs
Capitalized costs related to CWIP include eligible expenditures incurred in connection with acquisition, construction
or production of a qualifying asset. A qualifying asset is an asset that takes a substantial period of time to prepare for
its intended use. Interest and borrowing costs related to CWIP are capitalized when activities that are necessary to
prepare the asset for its intended use or sale are in progress, expenditures for the asset have been incurred and funds
have been used or borrowed to fund the construction or development. Capitalization of costs ceases when the asset is
ready for its intended use.
(ii) Pension and employee future benefits
Pension and employee future benefits are recognized in the consolidated financial statements in respect of
employees of the operating entities within Brookfield Renewable. The costs of retirement benefits for defined
benefit plans and post-employment benefits are recognized as the benefits are earned by employees. The projected
unit credit method, using the length of service and management’s best estimate assumptions, is used to value
Page 90
pension and other retirement benefits. All actuarial gains and losses are recognized immediately through OCI in
order for the net pension asset or liability recognized in the consolidated statements of financial position to reflect
the full value of the plan deficit or surplus. Net interest is calculated by applying the discount rate to the net defined
benefit asset or liability. Changes in the net defined benefit obligation related to service costs (comprising of current
service costs, past services costs, gains and losses on curtailments and non-routine settlements), and net interest
expense or income are recognized in the consolidated statements of income (loss).
Re-measurements, comprising of actuarial gains or losses, the effect of the asset ceiling, and the return on plan
assets (excluding net interest), are recognized immediately in the consolidated statements of financial position with a
corresponding debit or credit to OCI in the period in which they occur. Re-measurements are not reclassified to
income in subsequent periods. For defined contribution plans, amounts are expensed based on employee entitlement.
(iii) Decommissioning, restoration and environmental liabilities
Legal and constructive obligations associated with the retirement of property, plant and equipment are recorded as
liabilities when those obligations are incurred and are measured at the present value of the expected costs to settle
the liability, using a discount rate that reflects the current market assessments of the time value of money and the
risks specific to the liability. The liability is accreted up to the date the liability will be settled with a corresponding
charge to operating expenses. The carrying amount of decommissioning, restoration and environmental liabilities is
reviewed annually with changes in the estimates of timing or amount of cash flows added to or deducted from the
cost of the related asset.
(iv) Provisions
A provision is a liability of uncertain timing or amount. A provision is recognized if Brookfield Renewable has a
present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be
required to settle the obligation and the amount can be reliably estimated. Provisions are not recognized for future
operating losses. The provision is measured at the present value of the best estimate of the expenditures expected to
be required to settle the obligation using a discount rate that reflects the current market assessments of the time value
of money and the risks specific to the obligation. Provisions are re-measured at each statement of financial position
date using the current discount rate. The increase in the provision due to the passage of time is recognized as interest
expense.
(v) Interest income
Interest income is earned with the passage of time and is recorded on an accrual basis.
(vi) Government grants
Brookfield Renewable becomes eligible for government grants by constructing or purchasing renewable power
generating assets, and by bringing those assets to commercial operation, coupled with a successful application to the
applicable program or agency. The assessment of whether or not a project has complied with the conditions and that
there is reasonable assurance the grants will be received will be undertaken on a case-by-case basis. Brookfield
Renewable reduces the cost of the asset by the amount of the grant. The grant amounts are recognized in income on
a systematic basis as a reduction of depreciation over the periods, and in the proportions, in which depreciation on
those assets is charged.
With respect to grants related to income, the government assistance (in the form of the difference between market
price and guaranteed fixed price) typically becomes payable once electricity is produced and delivered to the
relevant grid. It is at this point that the receipt of the grant becomes reasonably assured, and therefore the grant is
recognized as revenue in the month that delivery of the electricity occurs.
(r) Critical estimates
Brookfield Renewable makes estimates and assumptions that affect the carrying value of assets and liabilities,
disclosure of contingent assets and liabilities and the reported amount of income and OCI for the year. Actual results
could differ from these estimates. The estimates and assumptions that are critical to the determination of the amounts
reported in the consolidated financial statements relate to the following:
(i) Property, plant and equipment
Page 91
The fair value of Brookfield Renewable’s property, plant and equipment is calculated using estimates and
assumptions about future electricity prices from renewable sources, anticipated long-term average generation,
estimated operating and capital expenditures, future inflation rates, discount rates and terminal value, as described in
Note 12 – Property, plant and equipment, at fair value. Judgment is involved in determining the appropriate
estimates and assumptions in the valuation of Brookfield Renewable’s property, plant and equipment. See Note
1(s)(iii) – Critical judgments in applying accounting policies – Property, plant and equipment for further details.
Estimates of useful lives and residual values are used in determining depreciation and amortization. To ensure the
accuracy of useful lives and residual values, these estimates are reviewed on an annual basis.
(ii) Financial instruments
Brookfield Renewable makes estimates and assumptions that affect the carrying value of its financial instruments,
including estimates and assumptions about future electricity prices, long-term average generation, capacity prices,
discount rates, the timing of energy delivery and the elements affecting fair value of the tax equity financings. The
fair value of interest rate swaps is the estimated amount that another party would receive or pay to terminate the
swap agreements at the reporting date, taking into account current market interest rates. This valuation technique
approximates the net present value of future cash flows. See Note 5 – Risk management and financial instruments
for more details.
(iii) Deferred income taxes
The consolidated financial statements include estimates and assumptions for determining the future tax rates
applicable to subsidiaries and identifying the temporary differences that relate to each subsidiary. Deferred income
tax assets and liabilities are measured at the tax rates that are expected to apply during the year when the assets are
realized or the liabilities settled, using the tax rates and laws enacted or substantively enacted at the consolidated
statement of financial position dates. Operating plans and forecasts are used to estimate when the temporary
difference will reverse based on future taxable income.
(iv) Decommissioning liabilities
Decommissioning costs will be incurred at the end of the operating life of some of Brookfield Renewable’s assets.
These obligations are typically many years in the future and require judgment to estimate. The estimate of
decommissioning costs can vary in response to many factors including changes in relevant legal, regulatory, and
environmental requirements, the emergence of new restoration techniques or experience at other power generating
facilities. Inherent in the calculations of these costs are assumptions and estimates including the ultimate settlement
amounts, inflation factors, discount rates, and timing of settlements.
(v) Impairment of goodwill
The impairment assessment of goodwill requires estimation of the value-in-use or fair value less costs of disposal of
the CGUs or groups of CGUs to which goodwill has been allocated.
Brookfield Renewable uses the following critical assumptions and estimates for the value-in-use method: the
circumstances that gave rise to the goodwill, timing and amount of future cash flows expected from the CGUs;
discount rates; terminal capitalization rates; terminal valuation dates and future leverage assumptions.
(s) Critical judgments in applying accounting policies
The following are the critical judgments that have been made in applying the accounting policies used in the
consolidated financial statements that have the most significant effect on the amounts in the consolidated financial
statements:
(i) Preparation of consolidated financial statements
These consolidated financial statements present the financial position, results of operations and cash flows of
Brookfield Renewable. Brookfield Renewable exercises judgment in determining whether non-wholly owned
subsidiaries are controlled by Brookfield Renewable. Brookfield Renewable’s judgment included the determination
of (i) how the relevant activities of the subsidiary are directed; (ii) whether the rights of shareholdings are
substantive or protective in nature; and (iii) Brookfield Renewable’s ability to influence the returns of the subsidiary.
Page 92
(ii) Common control transactions
Common control business combinations specifically fall outside of scope of IFRS 3 and as such management has
used its judgment to determine an appropriate policy to account for these transactions by considering other relevant
accounting guidance that is within the framework of principles in IFRS and that reflects the economic reality of the
transactions. Brookfield Renewable’s policy is to record assets and liabilities recognized as a result of transactions
between entities under common control at the carrying value on the transferor’s financial statements, and to have the
consolidated statements of income (loss), consolidated statements of comprehensive income, consolidated
statements of financial position, consolidated statements of changes in equity and consolidated statements of cash
flows reflect the results of the combined entities for all periods presented for which the entities were under the
transferor’s common control, irrespective of when the combination takes place. Differences between the
consideration given and the assets and liabilities received are recorded directly to equity.
(iii) Property, plant and equipment
The accounting policy relating to Brookfield Renewable’s property, plant and equipment is described in Note 1(g) –
Property, plant and equipment and revaluation method. In applying this policy, judgment is used in determining
whether certain costs are additions to the carrying amount of the property, plant and equipment as opposed to repairs
and maintenance that are expensed when incurred. If an asset has been developed, judgment is required to identify
the point at which the asset is capable of being used as intended and to identify the directly attributable costs to be
included in the carrying value of the development asset. The useful lives of property, plant and equipment are
determined by independent engineers periodically with an annual review by management.
Annually, Brookfield Renewable determines the fair value of its property, plant and equipment using a methodology
that it has judged to be reasonable. The methodology for hydroelectric assets is generally a twenty-year discounted
cash flow model. Twenty years is the period considered reasonable as Brookfield Renewable has twenty-year capital
plans and it believes a reasonable third party would be indifferent between extending the cash flows further in the
model versus using a discounted terminal value. The methodology for wind, solar and storage & other assets is to
align the model length with the expected remaining useful life of the subject assets.
The valuation model incorporates future cash flows from long-term power purchase agreements that are in place
where it is determined that the power purchase agreements are linked specifically to the related power generating
assets. With respect to estimated future generation that does not incorporate long-term power purchase agreement
pricing, the cash flow model uses estimates of future electricity prices using broker quotes from independent sources
for the years in which there is a liquid market. The valuation of generation not linked to long-term power purchase
agreements also requires the development of a long-term estimate of future electricity prices. In this regard the
valuation model uses a discount to the all-in cost of construction with a reasonable return, to secure energy from a
new renewable resource with a similar generation profile to the asset being valued as the benchmark that will
establish the market price for electricity for renewable resources.
Brookfield Renewable’s long-term view is anchored to the cost of securing new energy from renewable sources to
meet future demand growth by the years 2027 to 2035 in North America, 2030 in Colombia, and 2027 in Brazil. The
year of new entry is viewed as the point when generators must build additional capacity to maintain system
reliability and provide an adequate level of reserve generation with the retirement of older coal-fired plants and
rising environmental compliance costs in North America and Europe, and overall increasing demand in Colombia
and Brazil. For the North American and European businesses, Brookfield Renewable has estimated a discount to
these new-build renewable asset prices to determine renewable electricity prices for hydroelectric, solar and wind
facilities. In Brazil and Colombia, the estimate of future electricity prices is based on a similar approach as applied
in North America using a forecast of the all-in cost of development.
Terminal values are included in the valuation of hydroelectric assets in North America and Colombia. For the
hydroelectric assets in Brazil, cash flows have been included based on the duration of the authorization or useful life
of a concession asset with consideration of a one-time thirty-year renewal on qualifying hydroelectric assets.
Discount rates are determined each year by considering the current interest rates, average market cost of capital as
well as the price risk and the geographical location of the operational facilities as judged by management. Inflation
rates are also determined by considering the current inflation rates and the expectations of future rates by
economists. Operating costs are based on long-term budgets escalated for inflation. Each operational facility has a
Page 93
twenty-year capital plan that it follows to ensure the maximum life of its assets is achieved. Foreign exchange rates
are forecasted by using the spot rates and the available forward rates, extrapolated beyond the period available. The
inputs described above to the discounted cash flow model require management to consider facts, trends and plans in
making its judgments as to what derives a reasonable fair value of its property, plant and equipment.
(iv) Financial instruments
The accounting policy relating to Brookfield Renewable’s financial instruments is described in Note 1(l) – Financial
instruments. In applying the policy, judgments are made in applying the criteria set out in IFRS 9 to record financial
instruments at fair value through profit and loss, fair value through other comprehensive income and the assessments
of the effectiveness of hedging relationships.
For power purchase agreements accounted for under IFRS 9 (“IFRS 9 PPAs”) that have unobservable values,
Brookfield Renewable determines the fair value of these IFRS 9 PPAs using a discounted cash flow model based on
the term of the contract and applies judgements surrounding the inputs used within the valuation model. The
valuation model incorporates various inputs and assumptions including future power prices, contractual prices,
contractual volumes and discount rates. Future power prices are based on broker quotes from independent sources
and for IFRS 9 PPAs with no available broker quotes, future fuel driven merchant prices are incorporated within the
model. Contractual prices are stipulated within each individual agreement, contractual volumes are either specified
within the agreement or determined using future generation of the power generating assets and discount rate used in
the valuation model is the credit adjusted risk free rate.
(v) Deferred income taxes
The accounting policy relating to Brookfield Renewable’s income taxes is described in Note 1(n) – Income taxes. In
applying this policy, judgments are made in determining the probability of whether deductions, tax credits and tax
losses can be utilized.
(t) Recently adopted accounting standards
International Tax Reform - Amendments to IAS 12 – Pillar Two model rules
In May 2023, the IASB issued amendments to IAS 12 “Income Taxes” to give entities temporary mandatory relief
from accounting for deferred taxes arising from the Organization for Economic Co-operation and Developments
(“OECD”) international tax reform. The amendments are effective immediately upon their issue and retrospectively
in accordance with IAS 8 “Accounting Policies, Changes in Accounting Estimates and Errors,” except for some
targeted disclosure requirements which become effective for annual reporting periods on or after January 1, 2023.
Brookfield Renewable operates in countries which have enacted new legislation to implement the global minimum
top-up tax. Brookfield Renewable has applied the temporary mandatory relief from recognizing and disclosing
information related to the top-up tax and will account for it as a current tax when it is incurred. The newly enacted
legislation is effective from January 1, 2024 and there is no current tax impact for the year ended December 31,
2023. The global minimum top-up tax is not anticipated to have a significant impact on the financial position of
Brookfield Renewable.
(u) Future changes in accounting policies
Amendments to IAS 1 – Presentation of Financial Statements (“IAS 1”)
The amendments clarify how to classify debt and other liabilities as current or non-current. The amendments to IAS
1 apply to annual reporting periods beginning on or after January 1, 2024. Brookfield Renewable is currently
assessing the impact of these amendments.
There are currently no other future changes to IFRS with potential impact on Brookfield Renewable.
Page 94
2. PRINCIPAL SUBSIDIARIES
The following table lists the subsidiaries of Brookfield Renewable which significantly affect its financial position
and results of operations as at December 31, 2023:
Jurisdiction of
Incorporation or
Organization
Percentage of
voting securities
owned or
controlled (%)
BP Brazil US Subco LLC ...............................................................................................
Delaware
Brookfield BRP Canada Corp. .......................................................................................
Ontario
Brookfield BRP Europe Holdings (Bermuda) Limited ..................................................
Bermuda
Brookfield Power US Holding America Co. ..................................................................
Delaware
Isagen S.A. E.S.P.(1)
TerraForm Power Parent, LLC(1)
.......................................................................................................
....................................................................................
Colombia
New York
100
100
100
100
99.70
100
(1)
Voting control held, in whole or in part, through voting agreements with Brookfield and co-investment.
3. ACQUISITIONS
The following investments were accounted for using the acquisition method by Brookfield Renewable, and the
results of operations have been included in the audited annual consolidated financial statements since the date of
acquisition.
Brazil Wind Portfolio
On March 3, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of 100%
interest in a 136 MW portfolio of operating wind assets in Brazil. The total purchase price of this acquisition was
$95 million (approximately $24 million net to Brookfield Renewable), comprising of closing consideration,
including working capital and closing adjustments of $90 million (approximately $23 million net to Brookfield
Renewable) and $5 million of deferred consideration (approximately $1 million net to the Brookfield Renewable).
Brookfield Renewable holds an approximately 25% economic interest. The total transaction costs related to the
acquisition were less than $1 million and have been classified under Other in the consolidated statement of income
(loss). If the acquisition had taken place at the beginning of the year, the revenue from the Brazil Wind Portfolio
would have been $24 million for the year ended December 31, 2023.
Brazil Distributed Generation
On May 4, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of a 90%
interest in a distributed generation platform with approximately 730 MW of development pipeline in Brazil. The
purchase price of this acquisition was $4 million (approximately $1 million net to Brookfield Renewable) with fair
value of assets acquired of $5 million and liabilities assumed of $1 million. Brookfield Renewable holds an
approximately 20% economic interest.
U.S. Renewable Portfolio
On October 25, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of a
100% interest in a fully integrated developer and operator of renewable power assets in the United States with 5,900
MW of operating and under construction assets, with a 6,100 MW development pipeline for $1,083 million
(approximately $308 million net to Brookfield Renewable) comprised of $565 million (approximately $161 million
net to Brookfield Renewable) plus $518 million of deferred consideration (approximately $147 million net to
Brookfield Renewable). Total fair value of net assets acquired, net of non-controlling interest was $1,453 million.
The total transaction costs related to the acquisition were $6 million (approximately $2 million net to Brookfield
Renewable) and have been classified under Other in the consolidated statement of income (loss). If the acquisition
had taken place at the beginning of the year, the revenue from the U.S. Renewable Portfolio would have been
$401 million for the year ended December 31, 2023.
Page 95
India Renewable Portfolio
On April 22, 2023, Brookfield Renewable, together with institutional partners, acquired an approximately 7% equity
interest (1% net to Brookfield Renewable) in a leading commercial and industrial renewable development platform
in India with 4,500 MW of operating and development pipeline for INR 2.5 billion ($30 million) (approximately
INR 500 million ($6 million) net to Brookfield Renewable). The investment was recognized as an equity accounted
investment. During the second and third quarters of 2023, Brookfield Renewable, together with institutional
partners, subscribed for incremental shares for an aggregate INR 1.7 billion ($21 million) (approximately INR
340 million ($4 million) net to Brookfield Renewable).
On October 26, 2023, Brookfield Renewable together with its institutional partners, subscribed for additional shares
for INR 9.8 billion ($118 million) (approximately INR 2 billion ($24 million) net to Brookfield Renewable). This
subscription increased the total interest to approximately 37.54% (approximately 7% net to Brookfield Renewable)
for aggregate consideration of approximately $168 million (approximately $34 million net to Brookfield Renewable)
and results in control of the board of directors. Through the transaction Brookfield Renewable acquired the business
at a total fair value of $447 million on a 100% basis. As such, Brookfield Renewable derecognized the existing
equity accounted investment and recognized the transaction as a business combination. The total transaction costs
related to the acquisition were $2 million (less than $1 million net to Brookfield Renewable) and have been
classified under Other in the consolidated statement of income (loss). If the acquisition had taken place at the
beginning of the year, the revenue would have been approximately $108 million for the year ended December 31,
2023.
Brazil Wind Portfolio
On November 6, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of a
100% interest in a 60 MW portfolio of operating wind assets in Brazil for total consideration of R$113 million
($23 million) (R$28 million ($6 million) net to Brookfield Renewable). Brookfield Renewable holds an
approximately 25% economic interest. The total transaction costs related to the acquisition were less than $1 million
and have been classified under Other in the consolidated statement of income (loss). If the acquisition had taken
place at the beginning of the year, the revenue from the Brazil Wind Portfolio would have been $9 million for the
year ended December 31, 2023.
U.K. Wind Portfolio
On December 14, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of
a 100% interest in a leading independent UK renewables developer with 260 MW onshore wind assets, 800 MW
near-term development and another 3 GW of later stage projects for a total purchase price of £489 million
($625 million) (£232 million ($296 million) net to Brookfield Renewable) comprising of closing consideration of
£477 million ($610 million) (£226 million ($289 million) net to Brookfield Renewable) and £12 million
($15 million) (£6 million ($7 million) net to Brookfield Renewable) of contingent consideration. The total
transaction costs related to the acquisition were $7 million (approximately $3 million net to Brookfield Renewable)
and have been classified under Other in the consolidated statement of income (loss). If the acquisition had taken
place at the beginning of the year, the revenue from the U.K. Wind Portfolio would have been $100 million for the
year ended December 31, 2023.
Page 96
The purchase price allocations, at fair value, as at December 31, 2023, with respect to the business combinations are
as follows:
Brazil
Wind
Portfolio
U.S.
Renewable
Portfolio(1)
India
Renewable
Portfolio(1)
Brazil
Wind
Portfolio(1)
U.K. Wind
Portfolio(1)
10 $
—
9
130
—
—
—
19
(22)
(4)
—
(45)
—
(2)
—
95
—
—
88 $
111
127
3,937
—
38
36
54
(88)
(187)
(1,037)
(905)
(29)
(219)
(130)
1,796
(343)
—
27 $
32
69
851
22
—
8
39
(62)
(35)
—
(581)
(48)
—
(19)
303
(37)
181
1 $
—
4
40
—
—
—
5
(2)
(2)
—
(17)
—
—
(6)
23
—
—
Total
60 $ 186
144
1
235
26
5,953
995
22
—
46
8
44
—
117
—
(187)
(13)
(61)
(289)
(65) (1,102)
(236) (1,784)
(228)
(151)
(227)
(6)
(213)
(58)
2,717
500
(414)
(34)
159
340
(MILLIONS)
Cash and cash equivalents ............................ $
Restricted cash ..............................................
Trade receivables and other current assets ...
Property, plant and equipment ......................
Deferred tax assets ........................................
Financial instruments assets(2)
......................
Equity accounted investments ......................
Other non-current assets ...............................
Accounts payable and accrued liabilities ......
Current portion of non-recourse borrowings
Financial instruments liabilities(2)
.................
Non-recourse borrowings .............................
Deferred income tax liabilities .....................
Provisions .....................................................
Other long-term liabilities ............................
Fair value of net assets acquired ...................
Non-controlling interests ..............................
Goodwill .......................................................
Total fair value of net assets acquired
including goodwill, net of non-controlling
interests ......................................................... $
(1)
95 $
1,453 $
447 $
23 $
625 $ 2,643
The purchase price allocation is preliminary as at December 31, 2023. Brookfield Renewable is currently assessing the fair value of
Property, plant and equipment, Financial instruments, Provisions, Deferred tax, Non-recourse borrowings, Other long-term liabilities and
Goodwill for the purchase price allocation and expect to finalize the balances in 2024 within the one year measurement period. Refer to
Note 7 - Other income for more details.
Includes both short-term and long-term balances.
(2)
The following investments were accounted for using the equity method as Brookfield Renewable has significant
influence through its position in the business, and the results of operations have been included in the audited annual
consolidated financial statements since the date of investment.
India Sustainable Agricultural Solutions
On February 16, 2023, Brookfield Renewable, together with institutional partners, acquired an approximately 4%
equity interest in a sustainable agricultural solutions company in India for INR 7 billion ($86 million)
(approximately INR 1.4 billion ($17 million) net to Brookfield Renewable).
X-Elio
On October 10, 2023, Brookfield Renewable, together with its institutional partners, completed the acquisition of the
remaining 50% interest in X-Elio for total consideration of $893 million ($76 million net to Brookfield Renewable
for approximately 4.2% interest). Brookfield Renewable holds a 17% economic interest in the investment and
continues to account for the investment as an equity accounted investment.
Westinghouse
On November 7, 2023, Brookfield Renewable, together with institutional partners, through a strategic partnership
with Cameco Corporation, acquired 100% of Westinghouse, one of the world’s largest nuclear services businesses,
from our affiliate Brookfield Business Partners L.P. and its institutional partners, for $4.37 billion ($442 million net
to Brookfield Renewable). Brookfield Renewable, together with institutional partners, own an aggregate 51%
interest (10.11% net to Brookfield Renewable) with Cameco owning 49%.
Page 97
Completed in 2022
The following investments were accounted for using the acquisition method by Brookfield Renewable, and the
results of operations have been included in the audited annual consolidated financial statements since the date of
acquisition.
U.S. Utility-scale Solar Portfolio
On January 24, 2022, Brookfield Renewable, together with its institutional partners, completed the acquisition of
100% interest in a utility scale development business with a 20 GW portfolio of utility-scale solar and energy
storage development assets in the United States. The total purchase price of this acquisition was $760 million
comprising of closing consideration including working capital and closing adjustments of $702 million, plus
$58 million of additional incentive payments to be paid contingent upon certain milestones being achieved. The total
transaction costs related to the acquisition were $2 million. Brookfield Renewable holds an approximately 20%
economic interest.
Europe Utility-scale Solar Portfolio
On February 2, 2022, Brookfield Renewable, together with institutional partners, completed the acquisition of 100%
interest in a 1.7 GW portfolio of utility-scale solar development assets in Germany. The total purchase price of this
acquisition was €81 million ($90 million) comprising of closing consideration including working capital and closing
adjustments, was approximately €66 million ($73 million), plus €15 million ($17 million) of additional incentive
payments to be paid contingent upon certain milestones being achieved. The total transaction costs related to the
acquisition were €2 million ($2 million). Brookfield Renewable holds an approximately 20% economic interest.
Chile Distributed Generation Portfolio
On March 17, 2022, Brookfield Renewable, together with institutional partners, completed the acquisition of 83%
interest in a 437 MW distributed generation portfolio of high quality operating and development assets in Chile. The
purchase price of this acquisition, including working capital and closing adjustments, was approximately
$31 million. Through the transaction Brookfield Renewable acquired the business at a total fair value of $37 million
on a 100% basis. The total transaction costs related to the acquisition was $1 million. Brookfield Renewable holds
an approximately 20% economic interest in the investment.
During the fourth quarter of 2022, Brookfield Renewable, together with institutional partners, contributed an
additional approximate $4 million to fund the development pipeline, increasing the ownership interest from 83% to
84%.
U.S. Distributed Generation Portfolio
On September 28, 2022, Brookfield Renewable, together with its institutional partners, completed the acquisition of
100% interest in an integrated distributed generation developer with approximately 500 MW of contracted operating
and under construction assets, and an 1.8 GW of development pipeline in the United States. The purchase price of
this acquisition was $614 million, consisting of $538 million initial equity price, a $22 million working capital and
closing adjustments and $98 million to repay previously existing non-recourse borrowings (in aggregate
$123 million net to Brookfield Renewable). The total transaction costs related to the acquisition were $5 million.
Brookfield Renewable holds an approximately 20% economic interest. If the acquisition had taken place at the
beginning of the year, the revenue from the U.S. Distributed Generation Portfolio would have been $46 million for
the year ended December 31, 2022.
During the year ended December 31, 2023, the purchase price allocation was finalized and as a result the purchase
price allocation as at December 31, 2022 does not correspond to the figures as disclosed in the 2022 Annual Report.
The effect of the purchase price allocation finalization resulted in a decrease of $73 million to Goodwill and a
corresponding increase of $36 million to Property, plant and equipment, a decrease of $7 million to Deferred tax
assets, $33 million to Non-recourse borrowings, $3 million to Provisions, and $8 million to Financial instrument
liabilities.
Page 98
The final purchase price allocation, at fair value, as at December 31, 2023, with respect to the U.S. Distributed
Generation Portfolio business combination is as follows:
(MILLIONS)
Cash and cash equivalents .................................................................................. $
U.S. Distributed Generation Portfolio
33
Restricted cash ....................................................................................................
Trade receivables and other current assets .........................................................
Property, plant and equipment ............................................................................
Financial instruments assets ...............................................................................
Deferred income tax assets .................................................................................
Other non-current assets .....................................................................................
Accounts payable and accrued liabilities ............................................................
Current portion of non-recourse borrowings ......................................................
Financial instruments liabilities ..........................................................................
Non-recourse borrowings ...................................................................................
Provisions ...........................................................................................................
Other long-term liabilities ..................................................................................
Fair value of net assets acquired .........................................................................
Goodwill .............................................................................................................
Total fair value of net assets acquired including goodwill ................................. $
U.S. Wind Portfolio
6
13
744
10
3
21
(66)
(10)
(7)
(312)
(22)
(35)
378
236
614
On December 16, 2022, Brookfield Renewable, together with institutional partners, completed the acquisition of
100% interest in a renewable developer with a portfolio of over 800 MW of operating wind assets and pipeline of
over 22 GW of solar and storage assets in the United States. The purchase price of this acquisition, including
working capital and closing adjustments, was approximately $1,092 million. The total transaction costs related to the
acquisition were $4 million. Brookfield Renewable holds an approximately 20% economic interest. If the acquisition
had taken place at the beginning of the year, the revenue from the U.S. Wind Portfolio would have been $82 million
for the year ended December 31, 2022.
During the year ended December 31, 2023, the purchase price allocation was finalized and as a result the purchase
price allocation as at December 31, 2022 does not correspond to the figures as disclosed in the 2022 Annual Report.
The effect of the purchase price allocation finalization included a decrease of $96 million to Property, plant and
equipment, $6 million in Assets held for sale, $12 million to Other non-current assets, $97 million to Financial
Instrument liabilities, $23 million to Other long-term liabilities, $6 million in Provisions. and an increase of
$9 million in Liabilities classified as held for sale.
Page 99
The final purchase price allocation, at fair value, as at December 31, 2023, with respect to the U.S. Wind Portfolio
business combination is as follows:
(MILLIONS)
Cash and cash equivalents .................................................................................. $
Restricted cash ....................................................................................................
Trade receivables and other current assets .........................................................
Assets classified as held for sale .........................................................................
Property, plant and equipment ............................................................................
Financial instruments assets ...............................................................................
Other non-current assets .....................................................................................
Accounts payable and accrued liabilities ............................................................
Liabilities classified as held for sale ...................................................................
Financial instruments liabilities ..........................................................................
Provisions ...........................................................................................................
Other long-term liabilities ..................................................................................
Fair value of net assets acquired .........................................................................
Non-controlling interests ....................................................................................
Goodwill .............................................................................................................
Total fair value of net assets acquired including goodwill, net of non-
controlling interests ............................................................................................ $
U.S. Wind Portfolio
26
5
13
234
1,700
2
10
(38)
(143)
(628)
(22)
(45)
1,114
(23)
1
1,092
Page 100
The purchase price allocations, at fair value, as at December 31, 2022, with respect to the business combinations are
as follows:
Chile
Distributed
Generation
Portfolio
Europe
Utility-
scale Solar
Portfolio
U.S. Utility-
scale Solar
Portfolio (1)
U.S. Distributed
Generation
Portfolio(2)(3)
US Wind
Portfolio(2)(4)
2 $
—
3 $
—
22 $
6
33 $
6
26 $
5
(MILLIONS)
Cash and cash equivalents ............... $
Restricted cash .................................
Trade receivables and other
current assets ...............................
Assets classified as held for sale(4)
..
Property, plant and equipment ........
Deferred tax assets ..........................
Financial instruments assets(5)
.........
Other non-current assets ..................
Accounts payable and accrued
liabilities ......................................
Current portion of non-recourse
borrowings ...................................
Liabilities classified as held for
sale(4)
............................................
Financial instruments liabilities(5)
...
Non-recourse borrowings ................
Deferred income tax
liabilities ......................................
Provisions ........................................
Other long-term liabilities ...............
Fair value of net assets
acquired .......................................
Non-controlling interests .................
Goodwill ..........................................
Total fair value of net assets
acquired including goodwill, net of
non-controlling interests .................. $
(1)
2
—
21
—
—
1
(1)
—
—
—
(6)
—
—
—
19
—
18
30
—
1
—
—
—
(5)
—
—
—
—
(7)
—
—
22
—
68
48
—
561
—
—
4
(32)
—
—
(15)
(48)
(43)
—
(30)
473
—
287
Total
86
17
106
240
3,087
10
12
48
13
—
708
10
10
21
13
240
1,796
—
2
22
(66)
(38)
(142)
(9)
—
(9)
—
(15)
(346)
—
(25)
(35)
305
—
309
(135)
(725)
—
—
(29)
(68)
(135)
(755)
(400)
(50)
(54)
(133)
1,109
(26)
9
1,928
(26)
691
37 $
90 $
760 $
614 $
1,092 $
2,593
During the year ended December 31, 2022, Brookfield Renewable recorded purchase price allocation adjustment of $176 million primarily
to Property, plant and equipment, Deferred tax asset, Other non-current assets, Deferred income tax liabilities and Other long-term
liabilities.
The purchase price allocation was preliminary as at December 31, 2022 and was finalized during the year ended December 31, 2023.
During the ended December 31, 2022, Brookfield Renewable recorded purchase price allocation adjustments of $97 million primarily to
Property, plant and equipment, at fair value, Deferred tax assets and Deferred income tax liabilities.
Refer to Note 4 - Disposal of assets.
Includes both short-term and long-term balances.
(2)
(3)
(4)
(5)
Page 101
The following investments were accounted for using the equity method as Brookfield Renewable has significant
influence through its position in the business, and the results of operations have been included in the audited annual
consolidated financial statements since the date of investment.
Powen
In February 2022, Brookfield Renewable, together with institutional partners, acquired an initial 16% interest in a
DG solar development business in Spain and Mexico with approximately 700 MW of operating and development
assets for $22 million ($6 million net to Brookfield Renewable). During the course of 2022, Brookfield Renewable,
together with institutional partners, subscribed for additional shares for $34 million ($7 million net to Brookfield
Renewable). This subscription increased our interest to approximately 32% (6% net to Brookfield Renewable)
In the second and third quarter of 2023, Brookfield Renewable, together with its institutional partner, subscribed for
additional shares in Powen for $49 million ($10 million net to Brookfield Renewable). These subscriptions increased
the total interest in Powen to 44% (8.8% net to Brookfield Renewable). Refer to Note 19 - Equity-accounted
investments for more details.
Island Aggregator LP
On June 20, 2022, Brookfield Renewable, together with institutional partners, committed to invest $500 million, of
which $122 million was deployed for a 20% stake in common equity into a private owner and operator of long-term,
U.S. denominated, contracted power and utility assets across the Americas with 1.2 GW of installed capacity and
approximately 1.3 GW development pipeline. Brookfield Renewable holds a 20% interest in this investment through
an intermediate entity.
California Resources Corporation
On August 3, 2022, Brookfield Renewable, together with its institutional partners, formed a joint venture with
California Resources Corporation (“CRC”) to establish a Carbon Management Business that will develop carbon
capture and storage in California. Brookfield Renewable, together with its institutional partners, has committed to
invest up to $500 million to fund the development of identified carbon capture and storage projects in California.
This includes an initial investment of approximately $137 million, of which $48 million was deployed during the
year ended December 31, 2022, which includes a put option that offers strong downside protection at a pre-
determined rate of return. Brookfield Renewable holds an approximate 10% economic interest.
California Bioenergy (“Calbio”)
On December 21, 2022, Brookfield Renewable, together with its institutional partners, closed its purchase of a 10%
interest in a developer, operator and owner of renewable natural gas assets in the U.S. with an initial equity
commitment of $150 million ($30 million net to Brookfield Renewable) and secured the option to invest up to
approximately $350 million ($70 million net to Brookfield Renewable) of follow-on equity capital for future
projects meeting our risk-return requirements. Brookfield Renewable holds an approximate 2% economic interest.
Completed in 2021
The following investments were accounted for using the acquisition method, and the results of operations have been
included in the audited annual consolidated financial statements since the date of acquisition.
Oregon Wind Portfolio
On March 24, 2021, Brookfield Renewable, together with institutional partners, completed the acquisition of 100%
of a portfolio of three wind generation facilities of approximately 845 MW and development projects of
approximately 400 MW (together, “Oregon Wind Portfolio”) located in Oregon, United States. The purchase price
of this acquisition, including working capital and closing adjustments, was approximately $744 million. The total
transaction costs of $6 million were expensed as incurred and have been classified under Other in the consolidated
statement of income (loss). Brookfield Renewable holds a 25% economic interest.
This investment was accounted for using the acquisition method, and the results of operations have been included in
the consolidated financial statements since the date of the acquisition. If the acquisition had taken place at the
beginning of the year, the revenue from the Oregon Wind Portfolio would have been $183 million for the year ended
December 31, 2021.
Page 102
During March 31, 2022, the purchase price allocation was finalized with no material changes from the purchase
price allocation as at December 31, 2021 as disclosed in the 2021 Annual Report.
U.S. Distributed Generation Portfolio
On March 31, 2021, Brookfield Renewable, together with institutional partners, completed the acquisition of 100%
of a distributed generation business (the “U.S. Distributed Generation Portfolio”) comprised of 360 MW of
operating and under construction assets across approximately 600 sites and 700 MW of development assets, all in
the United States. The purchase price of this acquisition, including working capital and closing adjustments, was
approximately $684 million. The total transaction costs of $2 million were expensed as incurred and have been
classified under Other in the consolidated statement of income (loss). Brookfield Renewable holds a 25% economic
interest.
This investment was accounted for using the acquisition method, and the results of operations have been included in
the consolidated financial statements since the date of the acquisition. If the acquisition had taken place at the
beginning of the year, the revenue from the U.S. Distributed Generation Portfolio would have been $79 million for
the year ended December 31, 2021.
The purchase price allocation, at fair value, as at December 31, 2021, with respect to the business combinations are
as follows:
(MILLIONS)
Cash and cash equivalents ......................................................... $
Restricted cash ...........................................................................
Trade receivables and other current assets ................................
Property, plant and equipment ...................................................
Current liabilities .......................................................................
Current portion of non-recourse borrowings .............................
Financial instruments .................................................................
Non-recourse borrowings ..........................................................
Provisions ..................................................................................
Other long-term liabilities .........................................................
Fair value of net assets acquired ................................................
Goodwill ....................................................................................
Total fair value of net assets acquired including goodwill, net
of non-controlling interests ........................................................ $
Oregon Wind
Portfolio
U.S. Distributed
Generation Portfolio
1 $
49
28
1,643
(10)
(74)
(16)
(761)
(83)
(33)
744
—
1 $
5
23
723
(6)
(7)
—
(133)
(16)
(23)
567
117
Total
2
54
51
2,366
(16)
(81)
(16)
(894)
(99)
(56)
1,311
117
744 $
684 $
1,428
The following investments were accounted for using the equity method as Brookfield Renewable has significant
influence through its position in the business, and the results of operations have been included in the audited annual
consolidated financial statements since the date of investment.
Polenergia
In the first quarter of 2021, Brookfield Renewable, together with its institutional partners, closed its purchase of a
23% interest in a large scale renewable business in Poland, in connection with its previously announced tender offer
alongside the current majority shareholder, at a cost of approximately $175 million (approximately $44 million net
to Brookfield Renewable for a 6% interest). Brookfield Renewable, together with its institutional partners and the
current majority shareholder, holds a 75% interest in the company.
In the first quarter of 2022, Brookfield Renewable, together with its institutional partner, subscribed for additional
shares in Polenergia. This subscription increased the total interest in Polenergia to 32% (8% net to Brookfield
Renewable).
Page 103
4. DISPOSAL OF ASSETS
On March 17, 2023, Brookfield Renewable’s institutional partners completed the sale of a 78% interest in a 378
MW operating hydroelectric portfolio in the U.S., of which 28% was sold to affiliates of Brookfield Corporation.
Brookfield Renewable retained its 22% interest in the investment and accordingly, did not receive any proceeds
from the sale. Subsequent to the completion of the sale, Brookfield Renewable no longer consolidates this
investment and recognized its interest as an equity-accounted investment. As a result of the disposition, Brookfield
Renewable derecognized $667 million of total assets and $191 million of total liabilities from the consolidated
statements of financial position. Brookfield Renewable’s post-tax portion of the accumulated revaluation surplus of
$34 million was reclassified from accumulated other comprehensive income directly to equity and presented as a
Disposals item in the consolidated statements of changes in equity.
On May 17, 2023, Brookfield Renewable, together with its institutional partners, completed the sale of wind assets
in the U.S. that were acquired in 2022 for proceeds of approximately $217 million ($14 million net to Brookfield
Renewable) net of transaction fees. There was no gain or loss on disposition recognized in the consolidated
statements of income (loss) as a result of the disposition. Brookfield Renewable derecognized $246 million of total
assets, $155 million of total liabilities, and non-controlling interest of $23 million from the consolidated statements
of financial position.
On September 20, 2023, Brookfield Renewable, together with its institutional partners, completed the sale of its
100% interest in a 95 MW portfolio of wind assets in Uruguay for proceeds of approximately $112 million
($65 million net to Brookfield Renewable) net of transaction fees. As a result of the disposition, Brookfield
Renewable derecognized $238 million of total assets and $193 million of total liabilities from the consolidated
statements of financial position. As a result of the disposition, accumulated other comprehensive income of
$5 million was reclassified to profit and loss. This resulted in a gain on disposition of $72 million ($42 million net to
Brookfield Renewable) recognized within Other income in the consolidated statements of income (loss).
On September 20, 2023, Brookfield Renewable, together with its institutional partners, completed the sale of its
100% interest in a 26 MW solar asset in Uruguay for proceeds of approximately $41 million ($13 million net to
Brookfield Renewable). As a result of the disposition, Brookfield Renewable derecognized $43 million of total
assets, and $1 million of total liabilities from the consolidated statements of financial position. As a result of the
disposition, Brookfield Renewable's post-tax portion of the accumulated revaluation surplus of $13 million was
reclassified from accumulated other comprehensive income directly to equity and presented as a Disposals item in
the consolidated statements of changes in equity.
5. RISK MANAGEMENT AND FINANCIAL INSTRUMENTS
Brookfield Renewable’s activities expose it to a variety of financial risks, including market risk (i.e., commodity
price risk, interest rate risk, and foreign currency risk), credit risk and liquidity risk. Brookfield Renewable uses
financial instruments primarily to manage these risks.
The sensitivity analysis discussed below reflects the risks associated with instruments that Brookfield Renewable
considers are market sensitive and the potential loss resulting from one or more selected hypothetical changes.
Therefore, the discussion below is not intended to fully reflect Brookfield Renewable’s risk exposure.
(a) Market risk
Market risk is defined for these purposes as the risk that the fair value or future cash flows of a financial instrument
held by Brookfield Renewable will fluctuate because of changes in market prices.
Brookfield Renewable faces market risk from foreign currency assets and liabilities, the impact of changes in
interest rates, and floating rate liabilities. Market risk is managed by funding assets with financial liabilities in the
same currency and with similar interest rate characteristics and holding financial contracts, such as interest rate
swaps and foreign exchange contracts, to minimize residual exposures. Financial instruments held by Brookfield
Renewable that are subject to market risk include borrowings and financial instruments, such as interest rate,
currency and commodity contracts. The categories of financial instruments that can give rise to significant
variability are described below:
Page 104
(i) Electricity price risk
Brookfield Renewable aims to sell electricity under long-term contracts to secure stable prices and mitigate its
exposure to wholesale markets. Electricity price risk arises from the sale of Brookfield Renewable’s uncontracted
generation and is mitigated by entering into short-term energy derivative contracts. Electricity price risk is defined
for these purposes as the risk that the fair value or future cash flows of a financial instrument held by Brookfield
Renewable will fluctuate because of changes in electricity prices.
The table below summarizes the impact of changes in the market price of electricity as at December 31. The impact
is expressed in terms of the effect on net income and OCI. The sensitivities are based on the assumption that the
market price changes by 5% with all other variables held constant.
Impact of a 5% change in the market price of electricity, on outstanding energy derivative contracts and IFRS 9
PPAs, for the year ended December 31:
(MILLIONS)
5% increase ................................. $
5% decrease .................................
(1)
Amounts represent the potential annual net pretax impact.
Effect on net income(1)
Effect on OCI(1)
2023
2022
2021
2023
2022
(62) $
(76) $
(37) $
(23) $
(36) $
62
75
40
23
36
2021
(21)
22
(ii) Foreign currency risk
Foreign currency risk is defined for these purposes as the risk that the fair value of a financial instrument held by
Brookfield Renewable will fluctuate because of changes in foreign currency rates.
Brookfield Renewable has exposure to the Canadian dollar, euro, Brazilian real, Colombian peso, British pound
sterling, Indian rupee, Malaysian ringgit, Chinese yuan and Polish złoty through its investments in foreign
operations. Consequently, fluctuations in the U.S. dollar exchange rate against these currencies increase the
volatility of net income and other comprehensive income. Brookfield Renewable holds foreign currency contracts
primarily to mitigate this exposure.
The table below summarizes the impact to Brookfield Renewable’s financial instruments of changes in the exchange
rate as at December 31. The impact is expressed in terms of the effect on income and OCI. The sensitivities are
based on the assumption that the currency exchange rate changes by five percent with all other variables held
constant.
Impact of a 5% change in U.S. dollar exchange rates, on outstanding foreign exchange swaps, for the year ended
December 31:
(MILLIONS)
2023
2022
2021
2023
2022
5% increase .............................. $
29 $
27 $
29 $
307 $
96 $
Effect on net income(1)
Effect on OCI(1)
5% decrease .............................
(1)
Amounts represent the potential annual net pretax impact.
(29)
(27)
(29)
(307)
(96)
2021
95
(95)
(iii) Interest rate risk
Interest rate risk is defined for these purposes as the risk that the fair value or future cash flows of a financial
instrument held by Brookfield Renewable will fluctuate, because of changes in interest rates.
Brookfield Renewable’s assets largely consist of long duration physical assets. Brookfield Renewable’s financial
liabilities consist primarily of long-term fixed-rate debt or variable-rate debt that has been swapped to fixed rates
with interest rate financial instruments. Other than tax equity, all other non-derivative financial liabilities are
recorded at their amortized cost. Brookfield Renewable also holds interest rate contracts to lock-in fixed rates on
certain anticipated future debt issuances.
Brookfield Renewable will enter into interest rate swaps designed to minimize the exposure to interest rate
fluctuations on its variable-rate debt. Fluctuations in interest rates could impact Brookfield Renewable’s cash flows,
Page 105
primarily with respect to the interest payable against Brookfield Renewable’s variable rate debt, which is limited to
certain non-recourse borrowings with a total principal value of $11,574 million (2022: $7,823 million). Of this
principal value, $4,681 million (2022: $3,396 million) has been fixed through the use of interest rate contracts. The
fair values of the recognized asset and liability for the interest rate swaps were calculated using a valuation model
with observable interest rates.
The table below summarizes the impact of changes in the interest rate as at December 31. The impact is expressed in
terms of the effect on income and OCI. The sensitivities are based on the assumption that the interest rate changes
by 1% with all other variables held constant.
Impact of a 1% change in interest rates, on outstanding interest rate swaps, variable-rate debt and tax equity, for the
year ended December 31:
(MILLIONS)
2023
2022
2021
2023
2022
1% increase .............................. $
(129) $
20 $
15 $
148 $
112 $
Effect on net income(1)
Effect on OCI(1)
1% decrease .............................
(1)
Amounts represent the potential annual net pretax impact.
130
(20)
(16)
(156)
(118)
2021
114
(124)
(b) Credit risk
Credit risk is the risk of loss due to the failure of a borrower or counterparty to fulfill its contractual obligations.
Brookfield Renewable’s exposure to credit risk in respect of financial instruments relates primarily to counterparty
obligations regarding energy contracts, interest rate swaps, forward foreign exchange contracts and physical
electricity transactions.
Brookfield Renewable minimizes credit risk with counterparties through the selection, monitoring and
diversification of counterparties, the use of standard trading contracts, and other credit risk mitigation techniques. In
addition, Brookfield Renewable’s power purchase agreements are reviewed regularly and the majority are with
customers having long standing credit histories or investment grade ratings, which limit the risk of non-collection.
See Note 22 – Trade receivables and other current assets, for additional details regarding Brookfield Renewable’s
trade receivables balance.
The maximum credit exposure at December 31 was as follows:
(MILLIONS)
2023
Trade receivables and other short-term receivables ......................................................................... $
923 $
Long-term receivables .....................................................................................................................
Financial instrument assets(1)
Due from related parties(1)
Contract asset(1)
................................................................................................................................
................................................................................................................
...........................................................................................................
382
400
1,578
375
2022
883
235
390
251
395
$
3,658 $
2,154
(1)
Includes both the current and long-term amounts.
(c) Liquidity risk
Liquidity risk is the risk that Brookfield Renewable cannot meet a demand for cash or fund an obligation when due.
Liquidity risk is mitigated by Brookfield Renewable’s cash and cash equivalent balances and its access to undrawn
credit facilities. Details of the available portion of credit facilities are included in Note 13 – Borrowings. Brookfield
Renewable also ensures that it has access to public capital markets and maintains a strong investment grade credit
rating.
Brookfield Renewable is also subject to the risk associated with debt financing. This risk is mitigated by the long-
term duration of debt instruments and the staggered maturity dates over an extended period of time.
Page 106
CASH OBLIGATIONS
The table below classifies the cash obligations related to Brookfield Renewable’s liabilities into relevant maturity
groupings based on the remaining period from the statement of financial position dates to the contractual maturity
date.
AS AT DECEMBER 31, 2023
(MILLIONS)
Accounts payable and accrued liabilities ...................................... $
Financial instrument liabilities(1)
..................................................
Due to related parties ....................................................................
..........................................................................
Other long-term liabilities – concession payments ......................
Lease liabilities(1)
Corporate borrowings(1)
Non-recourse borrowings(1)
Interest payable on borrowings(2)
................................................................
..........................................................
..................................................
< 1 year
2-5 years
> 5 years
1,197 $
— $
— $
401
835
1
41
183
4,752
2,651
871
705
4
193
679
9,474
7,123
1,010
—
11
534
1,981
12,794
6,977
Total
1,197
2,282
1,540
16
768
2,843
27,020
16,751
Total .............................................................................................. $
10,061 $
19,049 $
23,307 $
52,417
AS AT DECEMBER 31, 2022
(MILLIONS)
Accounts payable and accrued liabilities ...................................... $
Financial instrument liabilities(1)
..................................................
Due to related parties ....................................................................
..........................................................................
Other long-term liabilities – concession payments ......................
Lease liabilities(1)
Corporate borrowings(1)
Non-recourse borrowings(1)
Interest payable on borrowings(2)
................................................................
..........................................................
..................................................
Total .............................................................................................. $
(1)
< 1 year
2-5 years
> 5 years
1,086 $
— $
— $
559
586
2
30
249
2,027
1,368
1,018
1
6
116
664
7,904
4,141
652
—
12
413
1,643
12,390
4,663
Total
1,086
2,229
587
20
559
2,556
22,321
10,172
5,907 $
13,850 $
19,773 $
39,530
(2)
Includes both the current and long-term amounts.
Represents aggregate interest payable expected to be paid over the entire term of the obligations, if held to maturity. Variable rate interest
payments have been calculated based on estimated interest rates.
Fair value disclosures
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date.
Fair values determined using valuation models require the use of assumptions concerning the amount and timing of
estimated future cash flows and discount rates. In determining those assumptions, management looks primarily to
external readily observable market inputs such as interest rate yield curves, currency rates, commodity prices and, as
applicable, credit spreads.
A fair value measurement of a non-financial asset is the consideration that would be received in an orderly
transaction between market participants, considering the highest and best use of the asset.
Assets and liabilities measured at fair value are categorized into one of three hierarchy levels, described below. Each
level is based on the transparency of the inputs used to measure the fair values of assets and liabilities.
Level 1 – inputs are based on unadjusted quoted prices in active markets for identical assets and liabilities;
Level 2 – inputs, other than quoted prices in Level 1, that are observable for the asset or liability, either directly or
indirectly; and
Level 3 – inputs for the asset or liability that are not based on observable market data.
Page 107
The following table presents Brookfield Renewable's assets and liabilities including energy derivative contracts,
IFRS 9 PPAs, interest rate swaps, foreign exchange swaps and tax equity measured and disclosed at fair value
classified by the fair value hierarchy:
(MILLIONS)
Assets measured at fair value:
Cash and cash equivalents .................................. $
Restricted cash(1).................................................
Financial instrument assets(1)
IFRS 9 PPAs ....................................................
Energy derivative contracts .............................
Interest rate swaps ...........................................
Foreign exchange swaps ..................................
Tax equity ........................................................
Investments in debt and equity securities ...........
Property, plant and equipment ...........................
Liabilities measured at fair value:
Financial instrument liabilities(1)
IFRS 9 PPAs(2)
................................................
Energy derivative contracts .............................
Interest rate swaps ...........................................
Foreign exchange swaps ..................................
Tax equity ........................................................
................................
Contingent consideration(3)
Liabilities for which fair value is disclosed:
Corporate borrowings(1)
Non-recourse borrowings(1)
Total ................................................................... $
(1)
......................................
................................
Level 1
Level 2
Level 3
2023
2022
1,141 $
391
— $
—
— $
—
1,141 $
391
998
191
—
—
—
—
—
—
—
—
—
—
—
—
—
—
90
233
27
—
46
—
(56)
(82)
(105)
(353)
—
—
50
—
—
—
27
1,494
64,005
(742)
—
—
—
(1,782)
(92)
50
90
233
27
27
1,540
64,005
(798)
(82)
(105)
(353)
(1,782)
(92)
2
37
335
16
—
1,235
54,283
(668)
(238)
(82)
(110)
(1,131)
(68)
(2,731)
(2,116)
(3,315) $
—
(24,723)
(24,923) $
—
—
62,960 $
(2,731)
(26,839)
34,722 $
(2,362)
(21,117)
31,253
(2)
(3)
Includes both the current amount and long-term amount.
During the year ended December 31, 2023 $56 million (2022: nil) was transferred from Level 3 to Level 2.
Amount relates to business combination completed in 2022 and 2023 with obligations lapsing from 2024 to 2027.
Page 108
Financial instruments disclosures
Financial assets and liabilities are offset with the net amount reported in the Consolidated Statements of Financial Position, where Brookfield Renewable
currently has a legally enforceable right to offset and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously. The
aggregate amount of Brookfield Renewable’s net financial instrument positions as at December 31 are as follows:
Financial Instruments Assets
Financial Instruments Liabilities
Instruments not
designated as hedges
Instruments not
designated as hedges
Instruments
designated
as hedges
Fair value
through
profit & loss
Fair value
through
OCI
Instruments
designated as
hedges
Fair value
through
profit & loss
Fair value
through
OCI
Net Assets
(Liabilities)
(MILLIONS)
IFRS 9 PPAs ...............................................
Energy derivative contracts ........................
Interest rate swaps ......................................
Foreign exchange swaps .............................
Investments in debt and equity securities ...
Tax equity ...................................................
Balance, as at December 31, 2022 ............. $
Less: current portion ...................................
Long-term portion ......................................
IFRS 9 PPAs ............................................... $
Energy derivative contracts ........................
Interest rate swaps ......................................
Foreign exchange swaps .............................
Investments in debt and equity securities ...
Tax equity ...................................................
Balance, as at December 31, 2023 ............. $
Less: current portion ...................................
Long-term portion ......................................
— $
12 $
284
14
—
—
310 $
39 $
96
181
27
—
—
343 $
2 $
25 $
51
2
1,010
—
1,090 $
11 $
(6)
52
—
1,403
27
1,487 $
Total
2
— $
37
— $
335
—
16
—
1,235
225
—
—
225 $ 1,625
(125)
$ 1,500
50
— $
90
—
233
—
27
—
1,540
137
—
27
137 $ 1,967
(199)
$ 1,768
$
$
$
$
$
(94) $
(37) $
(15)
(90)
—
—
(236) $
(71) $
—
(33)
(325)
—
—
(429) $
(574) $
(201) $
(67)
(20)
—
(1,131)
(1,993) $
(727) $
(82)
(72)
(28)
—
(1,782)
(2,691) $
(666)
(201)
253
(94)
1,235
(1,131)
(604)
434
(170)
(748)
8
128
(326)
1,540
(1,755)
(1,153)
488
(665)
Total
— $ (668) $
— $ (238) $
(82)
—
(110)
—
—
—
—
(1,131)
— $ (2,229) $
559
$ (1,670) $
— $ (798) $
(82)
—
(105)
—
—
(353)
—
—
—
(1,782)
— $ (3,120) $
687
$ (2,433) $
Page 109
The following table presents the change in Brookfield Renewable’s total net financial instrument asset position as at and for the year ended December 31:
Balance as at
Dec 31, 2022
asset (liability)
Changes in
fair value
recognized
in OCI(1)
Changes in fair
value (hedge
ineffectiveness)(2)
Changes in fair
value on
financial
instruments
through profit
and loss(2)
Amounts
reclassified
from OCI to
income
............................... $
(MILLIONS)
IFRS 9 PPAs(3)
Energy derivative contracts ............
Interest rate swaps ..........................
Foreign exchange swaps .................
Investments in debt and equity
securities .......................................
Tax equity .......................................
$
(666) $
(201)
253
(94)
1,235
(1,131)
(604) $
54 $
220
(20)
(128)
8
—
134 $
(6) $
(3)
—
—
—
—
(9) $
74 $
89
33
(1)
119
243
557 $
Acquisitions,
settlements and
other
(217) $
13
(47)
(103)
13 $
(110)
(90)
—
Foreign
exchange
gain (loss)
Balance as at
Dec 31, 2023
asset (liability)
(748)
8
128
(326)
— $
—
(1)
—
—
—
(187) $
182
(867)
(1,039) $
(4)
—
(5) $
1,540
(1,755)
(1,153)
(1)
(2)
(3)
Amounts recognized in Equity-accounted investments, Gains (losses) arising during the year on financial instruments designated as cash-flow hedges and Unrealized gain (loss) on foreign
exchange swaps – net investment hedge on the consolidated statements of comprehensive income (loss).
Amounts recognized in Foreign exchange and financial instruments gain (loss) on the consolidated statements of income (loss) excluding realized gains and losses recorded on foreign exchange.
Level 3 power purchase agreements accounted for as energy derivatives that are either designated as a hedge or not designated as a hedge.
Balance as at
Dec 31, 2021
asset (liability)
Changes in
fair value
recognized
in OCI(1)
Changes in fair
value (hedge
ineffectiveness)(2)
Changes in fair
value on
derivatives not
designated in
hedge
relationships(2)
Amounts
reclassified
from OCI to
income
.............................. $
(MILLIONS)
IFRS 9 PPAs(3)
Energy derivative contracts ...........
Interest rate swaps .........................
Foreign exchange swaps ................
Investments in debt and equity
securities ......................................
Tax equity ......................................
$
(20) $
(151)
(188)
(24)
195
(455)
(643) $
(75) $
(117)
331
(56)
(11)
—
72 $
(13) $
2
5
—
—
—
(6) $
(216) $
(134)
85
89
13
115
(48) $
Acquisitions,
settlements and
other
(364) $
57
18
(103)
22 $
142
5
—
Foreign
exchange
gain (loss)
Balance as at
Dec 31, 2022
asset (liability)
(666)
(201)
253
(94)
— $
—
(3)
—
—
—
169 $
1,046
(791)
(137) $
(8)
—
(11) $
1,235
(1,131)
(604)
(1)
(2)
(3)
Amounts recognized in Equity-accounted investments, Gains (losses) arising during the year on financial instruments designated as cash-flow hedges and Unrealized gain (loss) on foreign
exchange swaps – net investment hedge on the consolidated statements of comprehensive income (loss).
Amounts recognized in Foreign exchange and financial instruments gain (loss) on the consolidated statements of income (loss) excluding realized gains and losses recorded on foreign exchange.
Level 3 power purchase agreements accounted for as energy derivatives that are either designated as a hedge or not designated as a hedge.
Page 110
(a) Tax equity
Brookfield Renewable owns and operates certain projects in the United States under tax equity structures to finance
the construction of utility-scale solar and wind projects. In accordance with the substance of the contractual
agreements, the amounts paid by the tax equity investors for their equity stakes are classified as financial instrument
liabilities on the consolidated statements of financial position.
Gains or losses on the tax equity liabilities are recognized within foreign exchange and financial instruments gain
(loss) in the consolidated statements of income (loss).
(b) Investments in debt and equity securities
Brookfield Renewable's investments in debt and equity securities are classified as FVPL, FVOCI and amortized
cost. Refer to Note 1(l) – Basis of preparation and material accounting policy information – Financial instruments.
(c) Energy derivative contracts and IFRS 9 PPAs
Brookfield Renewable has entered into long-term energy derivative contracts primarily to stabilize or eliminate the
price risk on the sale of certain future power generation. Certain energy contracts are recorded in Brookfield
Renewable’s consolidated financial statements at an amount equal to fair value, using quoted market prices or, in
their absence, a valuation model using both internal and third-party evidence and forecasts.
There is an economic relationship between the hedged items and the hedging instruments as the terms of the energy
derivative contracts match the terms of the expected highly probable forecast transactions (i.e. notional amount and
expected payment date). Brookfield Renewable has established a hedge ratio of 1:1 for the hedging relationships. To
measure the hedge effectiveness, Brookfield Renewable uses the hypothetical derivative method and compares
changes in the fair value of the hedging instruments against the changes in fair value of the hedged items attributable
to the hedged risks. The hedge ineffectiveness can arise from different indexes (and accordingly different curves)
linked to the hedged risk of the hedged items and hedging instruments.
For the year ended December 31, 2023, gains of $119 million relating to energy derivative contracts were realized
and reclassified from OCI to the consolidated statements of income (loss) (2022: $146 million and 2021:
$25 million).
Based on market prices as of December 31, 2023, unrealized losses of $49 million (2022: $37 million loss and 2021:
$72 million loss) recorded in accumulated other comprehensive income (“AOCI”) on energy derivative contracts are
expected to be settled or reclassified into income in the next twelve months. The actual amount reclassified from
AOCI, however, could vary due to future changes in market prices.
The following table summarizes the energy derivative contracts designated as hedging instruments:
Energy derivative contracts and IFRS 9 PPAs
December 31, 2023
December 31, 2022
Carrying amount (asset/(liability)) .........................................................................
Notional amount – GWh ........................................................................................
Weighted average hedged rate for the year ($/MWh) ............................................
64
26,083
50
(116)
13,674
58
Maturity dates .........................................................................................................
2024-2044
2023-2038
Hedge ratio .............................................................................................................
Change in discounted spot value of outstanding hedging instruments ..................
Change in value of hedged item used to determine hedge effectiveness ...............
1:1
152
(118)
1:1
(90)
64
There is nil of hedge ineffectiveness losses recognized within foreign exchange and financial instruments gain (loss)
in the consolidated statements of income (loss) related to energy derivative contracts (cash flow hedges) for the year
ended December 31, 2023 (2022: $18 million loss and 2021: $7 million loss).
(d) Interest rate hedges
Brookfield Renewable has entered into interest rate hedge contracts primarily to minimize exposure to interest rate
fluctuations on its variable-rate debt or to lock in interest rates on future debt refinancing. All interest rate hedge
contracts are recorded in the consolidated financial statements at fair value.
Page 111
There is an economic relationship between the hedged items and the hedging instruments as the terms of the interest
rate hedges match the terms of the respective fixed-rate debt (i.e., notional amount, maturity, payment and reset
dates). Brookfield Renewable established a hedge ratio of 1:1 for the hedging relationships. To measure the hedge
effectiveness, Brookfield Renewable uses the hypothetical derivative method and compares the changes in the fair
value of the hedging instrument against the changes in fair value of the hedged items attributable to the hedged risk.
The hedge ineffectiveness can arise from:
•
•
•
Different interest rate curves being applied to discount the hedged item and hedging instrument
Differences in timing of cash flows of the hedged item and hedging instrument
The counterparties’ credit risk having an asymmetrical impact on the fair value movements of the hedging
instrument and hedged item
As at December 31, 2023, agreements with a total notional exposure of $4,389 million were outstanding (2022:
$3,621 million) including $718 million (2022: $701 million) associated with agreements that are not formally
designated as hedging instruments. The weighted-average fixed interest rate resulting from these agreements is
(1.0)% (2022: 2.9%).
For the year ended December 31, 2023, net movements relating to cash flow hedges realized and reclassified from
OCI to interest expense in the consolidated statements of income (loss) were $3 million losses (2022: $2 million
losses and 2021: $18 million losses).
Based on market prices as of December 31, 2023, unrealized losses of $53 million (2022: $50 million and 2021:
$41 million) recorded in AOCI on interest rate swaps are expected to be settled or reclassified into income in the
next twelve months. The actual amount reclassified from AOCI, however, could vary due to future changes in
market rates.
The following table summarizes the interest rate hedges designated as hedging instruments:
Interest rate hedges
December 31, 2023
December 31, 2022
Carrying amount (asset/(liability)) .........................................................................
Notional amount – $ ...............................................................................................
Notional amount – C$(1)
Notional amount – €(1)
Notional amount – £(1)
Notional amount – COP(1)
............................................................................................
............................................................................................
.........................................................................................
......................................................................................
148
1,633
326
1,204
312
196
269
803
349
1,315
296
157
Maturity dates .........................................................................................................
2024-2061
2023-2061
Hedge ratio .............................................................................................................
Change in discounted spot value of outstanding hedging instruments ..................
Change in value of hedged item used to determine hedge effectiveness ...............
(1)
1:1
(124)
124
1:1
333
(328)
Notional amounts of foreign currency denominated interest rate hedges are presented at the U.S. dollar equivalent value based on the
December 31, 2023 foreign currency spot rate.
The hedge ineffectiveness loss recognized within foreign exchange and financial instruments gain (loss) in the
consolidated statements of income (loss) related to interest rate contracts (cash flow hedges) for the year ended
December 31, 2023 was nil (2022: $5 million and 2021: $17 million).
(e) Foreign exchange swaps
Brookfield Renewable has entered into foreign exchange swaps to minimize its exposure to currency fluctuations
impacting its investments and earnings in foreign operations, and to fix the exchange rate on certain anticipated
transactions denominated in foreign currencies.
There is an economic relationship between the hedged item and the hedging instrument as the net investment or
anticipated foreign currency transaction creates a translation risk that will match the respective hedging instrument.
Page 112
Brookfield Renewable established a hedge ratio of 1:1 as the underlying risk of the hedging instrument is identical to
the hedged risk component.
Certain Brookfield subsidiaries that Brookfield Renewable controls, through a voting agreement, have entered into
Master Hedge Agreements appointing Brookfield as their agent in entering into certain derivative transactions with
external counterparties to hedge against fluctuations in foreign exchange. Pursuant to each Agreement, Brookfield
was entitled to be reimbursed for any third party costs incurred in connection with the these derivative transactions.
Substantially all of Brookfield Renewable’s foreign exchange swaps are entered into pursuant to a Master Hedge
Agreement.
As at December 31, 2023, agreements with a total notional exposure of $6,690 million were outstanding (2022:
$3,669 million) including $565 million (2022: $1,804 million) associated with agreements that are not formally
designated as hedging instruments.
There are no unrealized gains or losses recorded in AOCI on foreign exchange swaps that are expected to be settled
or reclassified into income in the next twelve months (2022: nil and 2021: nil). The actual amount reclassified from
AOCI, however, could vary due to future changes in market rates.
The following table summarizes the foreign exchange swaps designated as hedging instruments:
Foreign exchange swaps
December 31, 2023
December 31, 2022
...........................................
..............................................................
Carrying amount (asset/(liability)) .........................................................................
Notional amount for hedges of the Colombian Peso(1)
Notional amount for hedges of the euro(1)
Notional amount for hedges of the British pounds sterling(1)
Notional amount for hedges of the Chinese yuan(1)
Notional amount for hedges of the Indian rupee(1)
Notional amount for hedges of the Brazilian real(1)
Notional amount for hedges of other currencies(1)
Maturity date ..........................................................................................................
.................................................
.................................................
...............................................
...............................................
................................
Hedge ratio .............................................................................................................
Weighted average hedged rate for the year:
COP/$ foreign exchange forward contracts ......................................................
€/$ foreign exchange forward contracts ............................................................
£/$ foreign exchange forward contracts ............................................................
CNY/$ foreign exchange forward contracts ......................................................
INR/$ foreign exchange forward contracts .......................................................
BRL/$ foreign exchange forward contracts ......................................................
(1)
Notional amounts expressed in millions of U.S. dollars
(298)
2,602
644
818
701
710
607
43
(76)
601
302
76
575
128
79
104
2024 - 2027
2023 - 2024
1:1
4,642
0.99
0.80
6.92
86
5.37
1:1
5,038
0.99
0.83
7.05
83
5.69
Page 113
The following table presents a reconciliation of the limited partners’ equity reserves impacted by financial
instruments:
(MILLIONS)
Cash flow
hedges
Investments
in equity
securities
Foreign
currency
translation
Balance, as at December 31, 2021 .................................................................... $
(48) $
4 $
(842)
Effective portion of changes in fair value arising from:
Energy derivative contracts ............................................................................
Interest rate swaps ..........................................................................................
Foreign exchange swaps .................................................................................
Amount reclassified to profit or loss .................................................................
Foreign currency revaluation of designated borrowings ...................................
Foreign currency revaluation of net foreign operations ....................................
Valuation of investments in equity securities designated FVOCI ....................
Tax effect ...........................................................................................................
Other ..................................................................................................................
7
52
—
37
—
—
—
(29)
(2)
—
—
—
—
—
—
(3)
—
—
—
—
10
—
68
(74)
—
(5)
(2)
Balance, as at December 31, 2022 .................................................................... $
17 $
1 $
(845)
Effective portion of changes in fair value arising from:
Energy derivative contracts ............................................................................
Interest rate swaps ..........................................................................................
Foreign exchange swaps .................................................................................
Amount reclassified to profit or loss .................................................................
Foreign currency revaluation of designated borrowings ...................................
Foreign currency revaluation of net foreign operations ....................................
Tax effect ...........................................................................................................
Other ..................................................................................................................
4
54
(8)
(28)
—
—
(4)
1
—
—
—
—
—
—
—
—
—
—
(8)
—
(77)
232
—
(3)
Balance, as at December 31, 2023 .................................................................... $
36 $
1 $
(701)
Page 114
6. SEGMENTED INFORMATION
Brookfield Renewable’s Chief Executive Officer and Chief Financial Officer (collectively, the chief operating
decision maker or “CODM”) review the results of the business, manage operations, and allocate resources based on
the type of technology.
Brookfield Renewable operations are segmented by – 1) hydroelectric, 2) wind, 3) utility-scale solar, 4) distributed
energy and storage (distributed generation and pumped storage), 5) sustainable solutions (renewable natural gas,
carbon capture and storage, recycling, cogeneration biomass, nuclear services, and power transformation), and 6)
corporate - with hydroelectric further segmented by geography (i.e., North America, Colombia, and Brazil). This
best reflects the way in which the CODM reviews results of our company.
The reporting to the CODM was revised during the year to disaggregate the distributed energy & sustainable
solutions business into distributed energy & storage and sustainable solutions. This change is consistent with the
development of Brookfield Renewable’s business as distributed generation and sustainable solutions continue to
grow as a more significant component of the business. The financial information of operating segments in the prior
period has been restated to present the corresponding results of the distributed energy & storage and sustainable
solutions.
Reporting to the CODM on the measures utilized to assess performance and allocate resources is provided on a
proportionate basis. Information on a proportionate basis reflects Brookfield Renewable’s share from facilities
which it accounts for using consolidation and the equity method whereby Brookfield Renewable either controls or
exercises significant influence or joint control over the investment, respectively. Proportionate information provides
a Unitholder (holders of the GP interest, Redeemable/Exchangeable partnership units, BEPC exchangeable shares
and LP units) perspective that the CODM considers important when performing internal analyses and making
strategic and operating decisions. The CODM also believes that providing proportionate information helps investors
understand the impacts of decisions made by management and financial results allocable to Brookfield Renewable’s
Unitholders.
Proportionate financial information is not, and is not intended to be, presented in accordance with IFRS. Tables
reconciling IFRS data with data presented on a proportionate consolidation basis have been disclosed. Segment
revenues, other income, direct operating costs, interest expense, depreciation, current and deferred income taxes, and
other are items that will differ from results presented in accordance with IFRS as these items include Brookfield
Renewable’s proportionate share of earnings from equity-accounted investments attributable to each of the above-
noted items, and exclude the proportionate share of earnings (loss) of consolidated investments not held by us
apportioned to each of the above-noted items.
Brookfield Renewable does not control those entities that have not been consolidated and as such, have been
presented as equity-accounted investments in its consolidated financial statements. The presentation of the assets and
liabilities and revenues and expenses does not represent Brookfield Renewable’s legal claim to such items, and the
removal of financial statement amounts that are attributable to non-controlling interests does not extinguish
Brookfield Renewable’s legal claims or exposures to such items.
Brookfield Renewable reports its results in accordance with these segments and presents prior period segmented
information in a consistent manner.
The accounting policies of the reportable segments are the same as those described in Note 1 – Basis of preparation
and material accounting policy information. Brookfield Renewable analyzes the performance of its operating
segments based on Funds From Operations. Funds From Operations is not a generally accepted accounting measure
under IFRS and therefore may differ from definitions of Funds From Operations used by other entities, as well as the
definition of funds from operations used by the Real Property Association of Canada (“REALPAC”) and the
National Association of Real Estate Investment Trusts, Inc. (“NAREIT”).
Page 115
Brookfield Renewable uses Funds From Operations to assess the performance of Brookfield Renewable before the
effects of certain cash items (e.g., acquisition costs and other typical non-recurring cash items) and certain non-cash
items (e.g., deferred income taxes, depreciation, non-cash portion of non-controlling interests, unrealized gain or
loss on financial instruments, non-cash gain or loss from equity-accounted investments, and other non-cash items) as
these are not reflective of the performance of the underlying business. Brookfield Renewable includes realized
disposition gains and losses on assets that we developed and/or did not intend to hold over the long-term within
Funds From Operations in order to provide additional insight regarding the performance of investments on a
cumulative realized basis, including any unrealized fair value adjustments that were recorded in equity and not
otherwise reflected in current period net income.
Page 116
The following table provides each segment’s results in the format that management organizes its segments to make operating decisions and assess
performance and reconciles Brookfield Renewable’s proportionate results to the consolidated statements of income (loss) on a line-by-line basis by aggregating
the components comprising the earnings from Brookfield Renewable’s investments in associates and reflecting the portion of each line item attributable to non-
controlling interests for the year ended December 31, 2023:
(MILLIONS)
Hydroelectric
Attributable to Unitholders
North
America
Brazil
Colombia
Wind
Utility-
scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Contribution
from equity-
accounted
investments
Attributable
to non-
controlling
interests
and other(1)
As per IFRS
financials(2)
$ 2,826
$
(234) $
2,446
$
5,038
Revenues .................................................................................................. $
1,029
$ 240
$
293
$ 511
$ 365
$
241 $
147
$
Other income ............................................................................................
Direct operating costs ..............................................................................
Share of revenue, other income and direct operating costs from equity-
accounted investments ........................................................................
22
(381)
5
(73)
6
146
(124)
(164)
106
(99)
—
—
—
—
—
670
172
175
493
372
Management service costs .......................................................................
—
—
—
—
—
Interest expense ........................................................................................
Current income taxes ...............................................................................
(266)
(2)
(19)
(7)
(82)
(105)
(110)
(17)
(6)
(1)
Distributions attributable to
Preferred limited partners equity ..........................................................
Preferred equity ....................................................................................
Perpetual subordinated notes .................................................................
Share of interest and cash taxes from equity-accounted investments ......
—
—
—
—
—
—
—
—
Share of Funds From Operations attributable to non-controlling
interests ...............................................................................................
—
—
Funds From Operations ............................................................................
402
146
—
—
—
—
—
76
—
—
—
—
—
—
—
—
—
—
382
261
20
(81)
—
180
—
(43)
(4)
—
—
—
—
—
133
19
(105)
—
61
—
(6)
(3)
—
—
—
—
—
52
Depreciation .............................................................................................
Foreign exchange and financial instrument gain .....................................
Deferred income tax recovery ..................................................................
Other ........................................................................................................
Share of earnings from equity-accounted investments ............................
Net income attributable to non-controlling interests ...............................
Net loss attributable to Unitholders(3)
......................................................
—
88
412
(29)
(1,056)
—
59
—
2,182
(205)
(205)
(114)
(745)
—
(40)
(41)
(27)
(29)
(41)
(27)
(29)
—
—
—
—
(357)
1,095
(81)
110
205
—
—
33
7
—
—
—
(40)
—
—
340
(987)
—
1,799
—
(915)
(95)
—
—
—
—
(789)
—
671
(1,933)
205
(205)
(1,627)
(128)
(41)
(27)
(29)
(40)
(789)
(1,852)
502
176
(212)
21
170
$
(100)
(1)
(2)
(3)
Amounts attributable to non-controlling interests and other includes certain non-recurring other income items. Refer to Note 7 - Other Income.
Share of earnings from equity-accounted investments of $186 million is comprised of amounts found on the Share of revenue, other income and direct operating costs, Share of interest and cash taxes and Share of earnings
lines. Net income attributable to participating non-controlling interests – in operating subsidiaries of $619 million is comprised of amounts found on Share of Funds From Operations attributable to non-controlling interests
and Net Income attributable to non-controlling interests.
Net income (loss) attributable to Unitholders includes net income (loss) attributable to GP interest, Redeemable/Exchangeable partnership units, BEPC exchangeable shares and LP units. Total net income (loss) includes
amounts attributable to Unitholders, non-controlling interests, preferred limited partners equity, preferred equity, and perpetual subordinated notes.
Page 117
The following table provides each segment’s results in the format that management organizes its segments to make operating decisions and assess performance
and reconciles Brookfield Renewable’s proportionate results to the consolidated statements of income (loss) on a line-by-line basis by aggregating the
components comprising the earnings from Brookfield Renewable’s investments in associates and reflecting the portion of each line item attributable to non-
controlling interests for the year ended December 31, 2022:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility-
scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Contribution
from equity-
accounted
investments
Attributable
to non-
controlling
interests
As per IFRS
financials(1)
$ 2,636
$
(188) $
2,263
Revenues ................................................................................................ $
964
$ 197
$
273
$ 538
$ 374
$
242 $
48
$
Other income .........................................................................................
Direct operating costs ............................................................................
Share of revenue, other income and opex from equity-accounted
investments .......................................................................................
15
(376)
22
(52)
10
56
90
(82)
(164)
(102)
—
—
—
—
—
603
167
201
430
362
Management service costs .....................................................................
—
—
—
—
—
Interest expense ......................................................................................
Current income taxes .............................................................................
(185)
(6)
(20)
(9)
(57)
(27)
(96)
(8)
(102)
(7)
Distributions attributable to
Preferred limited partners equity .......................................................
Preferred equity ..................................................................................
Perpetual subordinated notes .............................................................
Share of interest and cash taxes from equity-accounted investments ....
Share of Funds From Operations attributable to non-controlling
interests .............................................................................................
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Funds From Operations .........................................................................
412
138
117
326
253
23
(76)
—
189
—
(40)
(1)
—
—
—
—
—
148
3
(43)
—
8
—
(2)
—
—
—
—
—
—
6
Depreciation ...........................................................................................
Foreign exchange and financial instrument loss ....................................
Deferred income tax recovery ................................................................
Other ......................................................................................................
Share of earnings from equity-accounted investments ..........................
Net income attributable to non-controlling interests .............................
Net loss attributable to Unitholders(2)
....................................................
—
73
292
(31)
(926)
—
42
—
2,002
(243)
(94)
(1)
(44)
(26)
(29)
(243)
(596)
(59)
(44)
(26)
(29)
(19)
86
121
—
—
19
10
—
—
—
—
—
(29)
—
—
(395)
1,005
—
—
(137)
(594)
7
1,539
—
(647)
(99)
—
—
—
(8)
(785)
—
4,711
136
(1,434)
128
(243)
(1,224)
(148)
(44)
(26)
(29)
(37)
(785)
(1,583)
(133)
150
(190)
5
451
$
(295)
(1)
(2)
Share of earnings from equity-accounted investments of $96 million is comprised of amounts found on the Share of revenue, other income and direct operating costs, Share of interest and cash taxes and Share of earnings
lines. Net income attributable to participating non-controlling interests – in operating subsidiaries of $334 million is comprised of amounts found on Share of Funds From Operations attributable to non-controlling interests
and Net income attributable to non-controlling interests.
Net income (loss) attributable to Unitholders includes net income (loss) attributable to GP interest, Redeemable/Exchangeable partnership units and LP units. Total net income (loss) includes amounts attributable to
Unitholders, non-controlling interests, preferred limited partners equity and preferred equity.
Page 118
The following table provides each segment’s results in the format that management organizes its segments to make operating decisions and assess performance
and reconciles Brookfield Renewable’s proportionate results to the consolidated statements of income (loss) on a line-by-line basis by aggregating the
components comprising the earnings from Brookfield Renewable’s investments in associates and reflecting the portion of each line item attributable to non-
controlling interests for the year ended December 31, 2021:
(MILLIONS)
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility-
scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Contribution
from equity-
accounted
investments
Attributable
to non-
controlling
interests
Revenues ............................................................................................ $
876
$ 169
$
224
$ 556
$ 348
$
215 $
27
$
Other income ......................................................................................
Direct operating costs ........................................................................
Share of revenue, other income and direct operating costs from
equity-accounted investments .......................................................
42
(349)
36
(50)
14
(79)
126
(171)
39
(89)
—
—
—
—
—
569
155
159
511
298
Management service costs .................................................................
—
—
—
—
—
Interest expense ..................................................................................
Current income taxes .........................................................................
(158)
(2)
(20)
(4)
(28)
(3)
(106)
(111)
(9)
(2)
Distributions attributable to
Preferred limited partners equity ....................................................
Preferred equity ..............................................................................
Perpetual subordinated notes .........................................................
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Share of interest and cash taxes from equity-accounted investments
—
—
—
—
—
Share of Funds From Operations attributable to non-controlling
interests .........................................................................................
—
—
—
—
—
Funds From Operations ......................................................................
409
131
128
396
185
—
(55)
—
160
—
(30)
(2)
—
—
—
—
—
128
3
(17)
—
13
—
(8)
—
—
—
—
—
—
5
Depreciation .......................................................................................
Foreign exchange and financial instrument loss ................................
Deferred income tax recovery ............................................................
Other ..................................................................................................
Share of earnings from equity-accounted investments ......................
Net income attributable to non-controlling interests .........................
Net loss attributable to Unitholders(2)
................................................
$ 2,415
$
(163) $
1,844
—
41
301
(30)
(840)
—
11
—
1,876
(288)
(78)
—
(55)
(26)
(12)
(288)
(539)
(22)
(55)
(26)
(12)
(11)
75
99
—
—
29
3
—
—
—
14
(600)
43
1,301
—
(471)
(24)
—
—
—
—
—
(32)
(33)
—
—
(448)
934
—
—
(773)
—
As per IFRS
financials(1)
4,096
304
(1,365)
142
(288)
(981)
(43)
(55)
(26)
(12)
(65)
(773)
(1,501)
(32)
29
(307)
(55)
564
(368)
$
(1)
(2)
Share of earnings from equity-accounted investments of $22 million is comprised of amounts found on the Share of revenue, other income and direct operating costs, Share of interest and cash taxes and Share of earnings
lines. Net income attributable to participating non-controlling interests – in operating subsidiaries of $209 million is comprised of amounts found on Share of Funds From Operations attributable to non-controlling interests
and Net income attributable to non-controlling interests.
Net income (loss) attributable to Unitholders includes net income (loss) attributable to GP interest, Redeemable/Exchangeable partnership units and LP units. Total net income (loss) includes amounts attributable to
Unitholders, non-controlling interests, preferred limited partners equity and preferred equity.
Page 119
The following table presents information on a segmented basis about certain items in our company’s consolidated statements of financial position and reconciles
our proportionate balances to the consolidated statements of financial position basis by aggregating the components comprising Brookfield Renewable's
investments in associates and reflecting the portion of each line item attributable to non-controlling interests:
(MILLIONS)
As at December 31, 2023
Attributable to Unitholders
Hydroelectric
North
America
Brazil
Colombia
Wind
Utility
-scale
solar
Distributed
energy &
storage
Sustainable
solutions
Corporate
Total
Contribution
from equity-
accounted
investments
Attributable
to non-
controlling
interests
As per IFRS
financials
Cash and cash equivalents .................................................................... $
77
$ 20
$
12
$ 225
$ 123
$
50 $
30
$
3
$
540
$
(85) $
686
$
1,141
Property, plant and equipment ..............................................................
15,134
1,694
2,490
6,024
3,635
Total assets ............................................................................................
16,143
1,880
2,738
6,802
4,518
Total liabilities ......................................................................................
9,231
531
1,645
4,727
3,484
2,386
2,842
1,705
341
1,540
1,126
—
31,704
257
36,720
3,159
25,608
(1,578)
(1,529)
(1,529)
33,879
40,937
22,070
64,005
76,128
46,149
As at December 31, 2022
Cash and cash equivalents .................................................................... $
55
$ 15
$
14
$ 150
$ 139
$
61 $
11
$
Property, plant and equipment ..............................................................
15,331
1,743
1,826
4,853
3,046
Total assets ............................................................................................
16,971
1,880
2,036
5,565
3,520
Total liabilities ......................................................................................
9,456
892
625
3,709
2,874
2,110
2,416
1,322
227
378
113
—
—
29,136
(1,165)
581
33,347
2,827
21,818
(587)
(577)
$
445
$
(43) $
596
$
998
26,312
31,351
16,584
54,283
64,111
37,825
Page 120
Geographical Information
The following table presents consolidated revenue split by reportable segment for the year ended December 31:
(MILLIONS)
Hydroelectric
2023
2022
2021
North America ..............................................................................................
Brazil .............................................................................................................
Colombia .......................................................................................................
$
Wind .................................................................................................................
Utility-scale solar .............................................................................................
Distributed energy & storage .........................................................................
1,135 $
269
1,285
2,689
1,213
751
350
1,211 $
181
1,135
2,527
1,146
700
298
Sustainable solutions .......................................................................................
Total .................................................................................................................
$
35
5,038 $
40
4,711 $
1,044
177
929
2,150
1,074
563
267
42
4,096
The following table presents consolidated property, plant and equipment and equity-accounted investments split by
geography:
(MILLIONS)
December 31, 2023
December 31, 2022
United States ...................................................................................................................... $
34,303 $
29,056
Colombia ............................................................................................................................
10,585
Canada ................................................................................................................................
Brazil ..................................................................................................................................
Europe ................................................................................................................................
Asia .....................................................................................................................................
Other ...................................................................................................................................
7,483
5,622
5,046
3,320
192
8,264
7,560
4,754
3,963
1,932
146
$
66,551 $
55,675
7. OTHER INCOME
Brookfield Renewable’s other income for the year ended December 31 is comprised of the following:
(MILLIONS)
2023
2022
Interest and other investment income .................................................................. $
107 $
68 $
Gain on regulatory and contract settlement .........................................................
Gain on disposition of non core assets and development assets ..........................
Other(1)
.................................................................................................................
22
72
470
43
—
25
$
671 $
136 $
2021
59
35
202
8
304
(1)
During the year ended December 31, 2023, Brookfield Renewable’s application of the acquisition method for it’s completed investments
resulted in the recognition of net assets at a fair value that exceeded consideration transferred. The difference in value of $370 million was
recorded within other income in the consolidated statements of income (loss). Refer to Note 3 - Acquisitions for more details.
Page 121
8. DIRECT OPERATING COSTS
Brookfield Renewable’s direct operating costs for the year ended December 31 are comprised of the following:
(MILLIONS)
Fuel and power purchases(1)(2)
Salaries and benefits ...........................................................................
.............................................................
Operations and maintenance ................................................................
Water royalties, property taxes and other regulatory fees ..................
Insurance ..............................................................................................
Professional fees .................................................................................
Other related party services .................................................................
28
Other ...................................................................................................
Notes
2023
2022
$
(574) $
(400) $
(464)
(347)
(238)
(72)
(122)
(5)
(111)
(325)
(309)
(205)
(71)
(59)
(1)
(64)
2021
(390)
(293)
(285)
(201)
(68)
(56)
(8)
(64)
(1)
(2)
Fuel and power purchases are primarily attributable to our portfolio in Colombia.
Includes $80 million in 2021 relating to the Texas winter storm event which reflect the cost of acquiring energy to cover our contractual
obligations for our wind assets that were not generating during the period due to freezing conditions, net of hedging initiatives.
Direct operating costs exclude depreciation expense of $1,852 million (2022: $1,583 million and 2021:
$1,501 million) which is presented separately.
$
(1,933) $
(1,434) $
(1,365)
9. OTHER
Brookfield Renewable’s other for the year ended December 31 is comprised of the following:
(MILLIONS)
Change in fair value of property, plant and equipment .......................
Notes
$
Amortization of service concession assets ..........................................
Transaction costs .................................................................................
Legal provisions ..................................................................................
27
Other ....................................................................................................
2023
(164) $
(11)
(5)
—
(32)
2022
(61) $
(15)
(2)
(6)
(106)
$
(212) $
(190) $
2021
(63)
(14)
(8)
(58)
(164)
(307)
10. FOREIGN CURRENCY TRANSLATION
Brookfield Renewable’s foreign currency translation for the year ended December 31 shown in the consolidated
statements of comprehensive income is comprised of the following:
(MILLIONS)
Foreign currency translation on
Notes
2023
2022
2021
Property, plant and equipment, at fair value ....................................
Goodwill ...........................................................................................
Borrowings .......................................................................................
Deferred income tax liabilities and assets ........................................
Other assets and liabilities ................................................................
12
17
13
11
$
2,798 $
(2,011) $
(1,510)
150
(818)
(698)
(115)
(131)
975
526
(6)
(121)
436
318
18
$
1,317 $
(647) $
(859)
Page 122
11. INCOME TAXES
The major components of income tax recovery (expense) for the year ended December 31 are as follows:
(MILLIONS)
Income tax recovery (expense) applicable to:
Current taxes
2023
2022
2021
Attributed to the current period .......................................................................... $
(128) $
(148) $
(43)
Deferred taxes
Income taxes – origination and reversal of temporary differences ....................
Relating to change in tax rates / imposition of new tax laws .............................
Relating to unrecognized temporary differences and tax losses ........................
193
—
(17)
176
125
10
15
150
Total income tax recovery (expense) .................................................................... $
48 $
2 $
160
(147)
16
29
(14)
The major components of deferred income tax (expense) recovery for the year ended December 31 recorded directly
to other comprehensive income are as follows:
(MILLIONS)
Deferred income taxes attributed to:
2023
2022
2021
Financial instruments designated as cash flow hedges ...................................... $
(15) $
Other ...................................................................................................................
Revaluation surplus
Origination and reversal of temporary differences ............................................
Relating to changes in tax rates / imposition of new tax laws ...........................
5
77
1
(75) $
(17)
3
(13)
(881)
34
(1,003)
(159)
$
68 $
(939) $
(1,172)
Brookfield Renewable’s effective income tax recovery (expense) for the year ended December 31 is different from
its recovery at its statutory income tax rate due to the differences below:
(MILLIONS)
Statutory income tax recovery (expense)(1)
Reduction (increase) resulting from:
....................................................... $
2023
2022
(165) $
(38) $
Decrease in tax assets not recognized ............................................................
Differences between statutory rate and future tax rate and tax rate changes .
Non-controlling interest .................................................................................
Subsidiaries’ income taxed at different rates ..................................................
Other ................................................................................................................
(11)
—
98
125
1
(10)
10
20
29
(9)
Effective income tax recovery (expense) ........................................................... $
(1)
Statutory income tax expense is calculated using domestic rates applicable to the profits in the relevant country.
48 $
2 $
2021
14
(5)
(147)
2
127
(5)
(14)
The above reconciliation has been prepared by aggregating the information for all of Brookfield Renewable’s
subsidiaries using the domestic rate in each tax jurisdiction.
Brookfield Renewable’s effective income tax rate was (8.5)% for the year ended December 31, 2023 (2022: (1.5)%
and 2021: (26.9)%). The effective tax rate is different than the statutory rate primarily due to rate differentials,
legislative changes in tax rates during the year, changes in tax assets not recognized and non-controlling interests’
income not subject to tax.
Page 123
The following table details the expiry date, if applicable, of the unrecognized deferred tax assets as at December 31:
(MILLIONS)
Less than four years ........................................................................................... $
Thereafter ..........................................................................................................
2023
12 $
166
2022
9 $
144
2021
5
138
The deferred tax assets and liabilities of the following temporary differences have been recognized in the
consolidated financial statements for the year ended December 31:
(MILLIONS)
Non-capital
losses
Difference
between tax and
carrying value
Net deferred
tax (liabilities)
assets
As at January 1, 2021 ........................................................................................ $
1,140 $
(6,450) $
(5,310)
Recognized in net income .................................................................................
Recognized in equity .........................................................................................
Business combination ........................................................................................
Foreign exchange ..............................................................................................
As at December 31, 2021 ..................................................................................
Recognized in net income .................................................................................
Recognized in equity .........................................................................................
Business combination ........................................................................................
Foreign exchange ..............................................................................................
As at December 31, 2022 ..................................................................................
Recognized in net income .................................................................................
Recognized in equity .........................................................................................
Business combination ........................................................................................
Foreign exchange ..............................................................................................
23
8
(28)
6
1,149
132
—
—
(8)
1,273
101
—
78
6
6
(1,068)
33
312
29
(1,060)
5
318
(7,167)
(6,018)
18
(947)
(42)
534
150
(947)
(42)
526
(7,604)
(6,331)
75
113
(268)
(704)
176
113
(190)
(698)
As at December 31, 2023 .................................................................................. $
1,458 $
(8,388) $
(6,930)
The deferred income tax liabilities include $6,885 million (2022: $6,914 million and 2021: $6,082 million) of
liabilities which relate to property, plant and equipment revaluations included in equity.
The unrecognized taxable temporary difference attributable to Brookfield Renewable’s interest in its subsidiaries,
branches, associates, and joint ventures is $5,203 million (2022: $6,028 million and 2021: $5,856 million).
Page 124
12. PROPERTY, PLANT AND EQUIPMENT, AT FAIR VALUE
The following table presents a reconciliation of property, plant and equipment at fair value:
(MILLIONS)
Notes
Hydroelectric
Wind
Solar
Other(1)
Total
Property, plant and equipment, at fair value .................
As at December 31, 2021 ....................................................
Additions, net(2)
...................................................................
Transfer from construction work-in-progress .....................
Acquisitions through business combinations ......................
Disposals .............................................................................
Transfer to assets held for sale ...........................................
Items recognized through OCI: ...........................................
Change in fair value ..........................................................
Foreign exchange ..............................................................
Items recognized through net income: ................................
Change in fair value ..........................................................
Depreciation ......................................................................
As at December 31, 2022 ....................................................
Additions(3)
..........................................................................
Transfer from construction work-in-progress .....................
Acquisitions through business combinations ......................
Disposals(4)
..........................................................................
Items recognized through OCI: ...........................................
Change in fair value ..........................................................
Foreign exchange ..............................................................
Items recognized through net income: ................................
Change in fair value ..........................................................
Depreciation ......................................................................
As at December 31, 2023 ..................................................
Construction work-in-progress ........................................
As at December 31, 2021 ....................................................
Additions, net ......................................................................
Transfer to property, plant and equipment ..........................
Acquisitions through business combinations ......................
Transfer to assets held for sale ...........................................
Items recognized through OCI: ...........................................
Change in fair value ..........................................................
Foreign exchange ..............................................................
As at December 31, 2022 ....................................................
Additions .............................................................................
Transfer to property, plant and equipment ..........................
Acquisitions through business combinations ......................
Items recognized through OCI: ...........................................
Change in fair value ..........................................................
Foreign exchange ..............................................................
Items recognized through net income:
Change in fair value ....................................................
As at December 31, 2023 ..................................................
Total property, plant and equipment, at fair value .......
As at December 31, 2022(5)(6)
..............................................
As at December 31, 2023(5)(6)
............................................
3
10
8
3
4
10
8
10
3
10
$
$
$
$
$
$
31,513 $
5
183
—
(97)
(677)
9,115 $
(194)
911
1,418
—
—
7,389 $
(65)
1,071
495
—
—
188 $ 48,205
(261)
2,172
1,913
(97)
(677)
(7)
7
—
—
—
2,490
(1,634)
(2)
(613)
31,168
5
154
—
—
(466)
2,435
779
(178)
8
(557)
11,302
60
934
3,177
—
367
113
(31)
(191)
(44)
(385)
8,239
394
851
1,980
(30)
28
178
77
7
(2)
(28)
242
—
2
—
(5)
(36)
9
3,315
(1,996)
(40)
(1,583)
50,951
459
1,941
5,157
(35)
(107)
2,735
(7)
(643)
32,646 $
(13)
(716)
15,224 $
(164)
(454)
11,022 $
(160)
24
(1,852)
(39)
197 $ 59,089
278 $
209
(183)
—
(8)
—
3
299
159
(154)
—
—
(3)
295 $
649 $
1,155
(911)
347
—
269
(23)
1,132
1,026
(934)
449
(60)
28
1,325
(1,071)
827
—
161
6
1,897
1,509
(851)
346
80
38
5 $
7
(7)
—
—
—
(1)
4
10
(2)
—
—
—
1,227
2,696
(2,172)
1,174
(8)
430
(15)
3,332
2,704
(1,941)
795
20
63
(1)
300 $
(24)
1,617 $
(32)
2,987 $
—
12 $
(57)
4,916
31,467 $
32,946 $
12,434 $
16,841 $
10,136 $
14,009 $
246 $ 54,283
209 $ 64,005
(1)
(2)
(3)
(4)
(5)
Includes biomass and cogeneration.
Includes fair value changes to decommissioning assets of nil (2022: $255 million).
Includes adjustments to purchase price allocations. Refer to Note 3 - Acquisitions for more details.
Relates to disposal of significant assets. See Note 4 - Disposal of assets for additional details.
Includes right-of-use assets not subject to revaluation of $60 million (2022: $64 million) in hydroelectric, $284 million (2022: $242 million) in wind,
$385 million (2022: $215 million) in solar and nil (2022: nil) in other.
Page 125
During the year ended December 31, 2023, Brookfield Renewable, together with its institutional partners, completed
the acquisitions of the following investments. They are accounted for as asset acquisitions as they do not constitute
business combinations under IFRS 3:
•
•
•
•
•
A series of distributed generation assets in the U.S. totaling 99 MW, with $156 million of property, plant
and equipment included in the consolidated statements of financial position at the acquisition date.
Brookfield Renewable holds a 25% economic interest.
A 48 MW portfolio of wind assets in China, with $53 million of property, plant and equipment included in
the consolidated statements of financial position at the acquisition date. Brookfield Renewable holds a 25%
economic interest.
A 50 MW portfolio of wind assets in China, with $68 million of property, plant and equipment included in
the consolidated statements of financial position at the acquisition date. Brookfield Renewable holds a 20%
economic interest.
A series of distributed generation assets in U.S. totaling 82 MW, with $86 million of property, plant and
equipment included in the consolidated statements of financial position at the acquisition date. Brookfield
Renewable holds a 20% economic interest.
A 60 MW portfolio of operating solar facilities in Colombia, with $71 million of property, plant and
equipment included in the consolidated statements of financial position at the acquisition date. The
company holds a 23% economic interest.
The fair value of Brookfield Renewable’s property, plant and equipment is calculated as described in Notes 1(g) –
and 1(r)(i) – Critical estimates – Property, plant and equipment. Judgment is involved in determining the appropriate
estimates and assumptions in the valuation of Brookfield Renewable’s property, plant and equipment. See Note
1(s)(iii) – Critical judgments in applying accounting policies – Property, plant and equipment. Brookfield
Renewable has classified its property, plant and equipment under level 3 of the fair value hierarchy.
Discount rates, terminal capitalization rates and terminal years used in the valuation methodology are provided in the
following table:
North America
Colombia
Brazil
Europe
2023
2022
2023
2022
2023
2022
2023
2022
Discount rate(1)
Contracted ...........................
5.1% - 5.7%
4.9% - 5.4%
Uncontracted .......................
Terminal capitalization rate(2)
.
Terminal year(3)
(1)
.......................
6.3% - 7.0%
6.2% - 6.7%
4.4% - 5.0%
4.3% - 4.9%
2046
2044
8.7 %
10.0 %
8.0 %
2043
8.5 %
9.7 %
7.7 %
2042
8.4 %
9.7 %
N/A
2053
8.2 %
9.5 %
N/A
2051
4.8%
4.8%
N/A
2037
4.4 %
4.4 %
N/A
2036
(2)
(3)
Discount rates are not adjusted for asset specific risks.
The terminal capitalization rate applies only to hydroelectric assets in the United States, Canada and Colombia.
For hydroelectric assets, terminal year refers to the valuation date of the terminal value.
The following table summarizes the impact of a change in discount rates, electricity prices and terminal
capitalization rates on the fair value of property, plant and equipment:
2023
(MILLIONS)
North
America
Colombia
Brazil
Europe
Total
25 bps increase in discount rates .......................... $
(1,400) $
(340) $
(120) $
(40) $
(1,900)
25 bps decrease in discount rates ..........................
5% increase in future energy prices ......................
1,550
1,350
5% decrease in future energy prices .....................
(1,340)
25 bps increase in terminal capitalization rate ......
25 bps decrease in terminal capitalization rate .....
(450)
500
380
540
(540)
(80)
90
130
140
(140)
—
—
40
—
—
—
—
2,100
2,030
(2,020)
(530)
590
Page 126
2022
(MILLIONS)
North
America
Colombia
Brazil
Europe
Total
25 bps increase in discount rates .......................... $
(1,530) $
(310) $
(110) $
(50) $
(2,000)
25 bps decrease in discount rates ..........................
5% increase in future energy prices ......................
1,650
1,280
5% decrease in future energy prices .....................
(1,270)
25 bps increase in terminal capitalization rate ......
25 bps decrease in terminal capitalization rate .....
(490)
540
260
440
(440)
(70)
80
110
120
(120)
—
—
50
—
—
—
—
2,070
1,840
(1,830)
(560)
620
Terminal values are included in the valuation of hydroelectric assets in the United States, Canada and Colombia. For
the hydroelectric assets in Brazil, cash flows have been included based on the duration of the authorization or useful
life of a concession asset plus a one-time 30-year renewal term for the majority of the hydroelectric assets. The
weighted-average remaining duration of the authorization or useful life of a concession asset at December 31, 2023,
including a one-time 30-year renewal for applicable hydroelectric assets, is 34 years (2022: 35 years). Consequently,
there is no terminal value attributed to the hydroelectric assets in Brazil at the end of the authorization term.
The following table summarizes the percentage of total generation contracted under power purchase agreements as
at December 31, 2023:
1 - 5 years ...................................................................
6 - 10 years .................................................................
Thereafter ....................................................................
75 %
57 %
30 %
61 %
29 %
3 %
North America
Colombia
Brazil
81 %
70 %
40 %
Europe
100 %
76 %
47 %
The following table summarizes average power prices from long-term power purchase agreements that are linked
specifically to the related power generating assets:
Per MWh(1)
1 - 10 years ................................................................. $
North America
Colombia
Brazil
Europe
77 COP 294,000 R$
313 €
381
73
65
11 - 20 years ...............................................................
74
357,000
(1)
Assumes nominal prices based on weighted-average generation.
The following table summarizes the estimates of future electricity prices:
Per MWh(1)
North America
Colombia
Brazil
Europe
1 - 10 years ................................................................. $
92 COP 412,000 R$
279 €
11 - 20 years ...............................................................
(1)
Assumes nominal prices based on weighted-average generation.
117
600,000
424
62
65
Brookfield Renewable’s long-term view is anchored to the cost of securing new energy from renewable sources to
meet future demand growth between 2027 and 2035. A further one year change would increase or decrease the fair
value of property, plant and equipment by approximately $153 million (2022: $140 million).
Had Brookfield Renewable’s revalued property, plant and equipment been measured on a historical cost basis, the
carrying amounts, net of accumulated depreciation would have been as follows at December 31:
Page 127
(MILLIONS)
2023
Hydroelectric ................................................................................................................................. $
10,582 $
Wind ..............................................................................................................................................
Solar ..............................................................................................................................................
Other(1)
...........................................................................................................................................
14,071
12,508
179
2022
9,812
10,146
8,576
158
$
37,340 $
28,692
(1)
Includes biomass and cogeneration.
13. BORROWINGS
Corporate Borrowings
The composition of corporate borrowings as at December 31 is presented in the following table:
December 31, 2023
December 31, 2022
(MILLIONS EXCEPT AS NOTED)
Interest
rate (%)
Term
(years)
Carrying
value
Estimated
fair value
Interest
rate (%)
Term
(years)
Carrying
value
Estimated
fair value
Weighted-average
Weighted-average
Credit facilities ...............
N/A
5
$
— $
—
Commercial paper ..........
Medium-Term Notes:
Series 4 (C$150) ..........
Series 9 (C$400) ..........
Series 10 (C$500) ........
Series 11 (C$475) ........
Series 12 (C$475) ........
Series 13 (C$300) ........
Series 14 (C$425) ........
Series 15 (C$400)(1)
Series 16 (C$400) ........
.....
6.0
5.8
3.8
3.6
4.3
3.4
4.3
3.3
5.9
5.3
4.3
<1
13
1
3
5
6
26
27
9
10
10
183
113
302
377
358
358
226
321
303
302
2,660
Total corporate borrowings ...................................
2,843 $
183
121
297
366
353
335
201
240
324
311
2,548
2,731
N/A
5.1
5.8
3.8
3.6
4.3
3.4
4.3
3.3
5.9
—
4.1
Add: Unamortized premiums(2)
Less: Unamortized financing fees(2)
Less: Current portion ..........................................
..........................
...................
2
(12)
(183)
$
2,650
5
$
— $
—
<1
14
2
4
6
7
27
28
10
—
11
249
249
111
295
369
351
351
221
314
295
—
114
286
350
338
316
184
218
307
—
2,307
2,113
2,556 $
2,362
2
(10)
(249)
$
2,299
(1) Includes $8 million (2022: $7 million) outstanding to Brookfield Reinsurance. Refer to Note 28 - Related party transactions for more details.
(2) Unamortized premiums and unamortized financing fees are amortized over the terms of the borrowing.
The following table outlines the change in the unamortized financing fees of corporate borrowings for the year
ended December 31:
(MILLIONS)
Corporate borrowings
2023
2022
Unamortized financing fees, beginning of year .............................................................................. $
(10) $
Additional financing fees ................................................................................................................
Amortization of financing fees .......................................................................................................
(3)
1
Unamortized financing fees, end of year ........................................................................................ $
(12) $
(10)
(1)
1
(10)
Page 128
Credit facilities
Brookfield Renewable had $183 million commercial paper outstanding as at December 31, 2023 (2022:
$249 million).
Brookfield Renewable issues letters of credit from its corporate credit facilities for general corporate purposes which
include, but are not limited to, security deposits, performance bonds and guarantees for debt service reserve
accounts. See Note 27 – Commitments, contingencies and guarantees for letters of credit issued by subsidiaries.
The following table summarizes the available portion of corporate credit facilities as at December 31:
(MILLIONS)
Authorized corporate credit facilities and related party credit facilities(1)
Draws on corporate credit facilities(1)(2)
Authorized letter of credit facility .....................................................................................................
............................................................................................
........................................ $
Issued letters of credit .......................................................................................................................
Available portion of corporate credit facilities ................................................................................. $
(1)
Amounts are guaranteed by Brookfield Renewable.
Relates to letter of credit issued against Brookfield Renewable’s corporate credit facilities.
(2)
2023
2,375 $
(165)
500
(307)
2022
2,375
—
500
(344)
2,403 $
2,531
Medium-term notes
Corporate borrowings are obligations of a finance subsidiary of Brookfield Renewable, Brookfield Renewable
Partners ULC (“Canadian Finco”) (Note 30 – Subsidiary Public Issuers). Canadian Finco may redeem some or all of
the borrowings from time to time, pursuant to the terms of the indenture. The balance is payable upon maturity, and
interest on corporate borrowings is paid semi-annually. The term notes payable by Canadian Finco are
unconditionally guaranteed by Brookfield Renewable, Brookfield Renewable Energy L.P. (“BRELP”) and certain
other subsidiaries.
In the first quarter of 2023, Brookfield Renewable issued C$400 million of Series 16 medium-term notes. The
medium-term notes have a fixed interest rate of 5.29% and a maturity date of October 28, 2033. The Series 16
medium-term notes are corporate-level green bonds.
Non-recourse borrowings
Non-recourse borrowings are typically asset-specific, long-term, non-recourse borrowings denominated in the
domestic currency of the subsidiary. Non-recourse borrowings in North America and Europe consist of both fixed
and floating interest rate debt indexed to the Secured Overnight Financing Rate (“SOFR”), the Sterling Overnight
Index Average (“SONIA”), the Euro Interbank Offered Rate (“EURIBOR”) and the Canadian Dollar Offered Rate
(“CDOR”). Brookfield Renewable uses interest rate swap agreements in North America and Europe to minimize its
exposure to floating interest rates. Non-recourse borrowings in Brazil consist of floating interest rates of Taxa de
Juros de Longo Prazo (“TJLP”), the Brazil National Bank for Economic Development’s long-term interest rate, or
Interbank Deposit Certificate rate (“CDI”), plus a margin. Non-recourse borrowings in Colombia consist of both
fixed and floating interest rates indexed to Indicador Bancario de Referencia rate (“IBR”), the Banco Central de
Colombia short-term interest rate, and Colombian Consumer Price Index (“IPC”), Colombia inflation rate, plus a
margin. Non-Recourse borrowings in India consist of both fixed and floating interest indexed to Prime lending rate
of lender (“MCLR”). Non-recourse borrowings in China consist of floating interest rates of People's Bank of China
(“PBOC”).
Effective January 1, 2022, SONIA replaced the £ London Interbank Offered Rate (“LIBOR”), and Euro Short-term
Rate (“€STR”) replaced € LIBOR. The Canadian Overnight Repo Rate Average (“CORRA”) is expected to replace
CDOR after June 28, 2024.
As at December 31, 2023, Brookfield Renewable’s floating rate borrowings have not been materially impacted by
SONIA and €STR reforms. Brookfield Renewable has completed an assessment and implemented its transition plan
to address the impact and effect changes as a result of amendments to the contractual terms for the replacement of
US$ LIBOR with SOFR referenced floating-rate borrowings, interest rate swaps, and updating hedge designations.
The adoption did not have a significant impact on Brookfield Renewable’s financial reporting.
Page 129
The composition of non-recourse borrowings as at December 31 is presented in the following table:
December 31, 2023
December 31, 2022
Weighted-average
Weighted-average
Weighted
-average
interest
rate (%)
Term
(years)
Carrying
value
Estimated
fair value
Weighted-
average
interest
rate (%)
Term
(years)
Carrying
value
Estimated
fair value
7.8
6.1
6.2
6.2
7.0
6.8
9
9
12
6
1
9
$
9,468 $ 9,292
6,866
5,868
3,035
1,783
6,922
5,879
2,963
1,783
27,020 $ 26,839
7.2
5.4
5.6
5.3
5.9
6.2
10
$
8,813 $
8,104
8
13
8
2
10
5,943
4,625
2,593
347
5,824
4,502
2,340
347
22,321 $ 21,117
(MILLIONS EXCEPT AS NOTED)
Non-recourse borrowings(1)(2)
Hydroelectric ..............................
Wind ...........................................
Utility-scale solar .......................
Distributed energy & storage(3)
..
Sustainable solutions ..................
Total ..............................................
Add: Unamortized premiums and discounts(4)
Less: Unamortized financing fees(4)
Less: Current portion ..................................................
...........................
...........
(11)
(140)
(4,752)
$ 22,117
105
(124)
(2,027)
$ 20,275
(1)
(2)
(3)
(4)
Includes $2,626 million (2022: $1,838 million) borrowed under a subscription facility of a Brookfield sponsored private fund.
Includes $101 million (2022: $93 million) outstanding to an associate of Brookfield. Refer to Note 28 - Related party transactions for more
details.
Includes adjustments to purchase price allocations. Refer to Note 3 - Acquisitions for more details.
Unamortized premiums, discounts, and financing fees are amortized over the terms of the borrowing.
Future repayments of Brookfield Renewable’s non-recourse borrowings for each of the next five years and thereafter
are as follows:
(MILLIONS)
Non-recourse borrowings
2024
2025
2026
2027
2028
Thereafter
Total
Hydroelectric .................................... $
664 $
691 $
1,610 $
718 $
602 $
5,183 $
9,468
Wind .................................................
Utility-scale solar .............................
Distributed energy & storage ...........
Sustainable solutions ........................
1,081
954
270
1,783
615
552
471
—
731
370
345
—
529
323
362
—
725
639
191
—
3,185
3,030
1,396
—
6,866
5,868
3,035
1,783
$
4,752 $
2,329 $
3,056 $
1,932 $
2,157 $ 12,794 $ 27,020
The following table outlines the change in the unamortized financing fees of non-recourse borrowings for the year
ended December 31:
(MILLIONS)
Non-recourse borrowings
2023
2022
Unamortized financing fees, beginning of year ............................................................................. $
(124) $
Additional financing fees ...............................................................................................................
Amortization of financing fees .......................................................................................................
Foreign exchange translation and other .........................................................................................
(50)
25
9
(132)
(49)
36
21
Unamortized financing fees, end of year ....................................................................................... $
(140) $
(124)
Page 130
The following table outlines the change in the unamortized premiums of non-recourse borrowings for the year ended
December 31:
(MILLIONS)
Non-recourse borrowings
2023
2022
Unamortized premiums and discounts, beginning of year ............................................................. $
105 $
Additional premiums and discounts ...............................................................................................
Amortization of premiums and discounts ......................................................................................
Foreign exchange translation and other .........................................................................................
(90)
(14)
(12)
Unamortized premiums and discounts, end of year ....................................................................... $
(11) $
160
(13)
(15)
(27)
105
Brookfield Renewable’s financing and refinancing completed for the year ended December 31, 2023 are as follows:
Period
Closed
Q1 2023
Q1 2023
Q1 2023
Q1 2023
Q1 2023
Q2 2023
Q2 2023
Q2 2023
Q2 2023
Q2 2023
Q3 2023
Q3 2023
Q3 2023
Q3 2023
Q3 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Q4 2023
Region
Technology
Distributed generation
US
Wind
China
Wind
China
Wind
China
Wind
China
Solar
India
Wind
Brazil
Hydroelectric
Canada
Solar
US
Wind
US
Wind
Brazil
Solar
Canada
Wind
US
Wind
China
Colombia Hydro
Wind
China
Wind
China
Solar
India
Hydro
Brazil
Hydro
US
Hydro
US
Wind
US
Wind
US
Solar
US
Solar
US
Solar
US
Various
US
US
Various
Colombia Hydro
Average
Interest
rate(1)
7.03% Financing
4.40% Financing
4.60% Financing
4.60% Financing
4.40% Financing
Financing
MCLR
CDI
Financing
6.19% Financing
6.62% Financing
Refinancing
SOFR
Financing
CDI
Financing
CDOR
Financing
SOFR
Financing
PBOC
IBR
Financing
5.00% Financing
4.20% Financing
8.80% Financing
7.72% Refinancing
6.16% Refinancing
7.75% Refinancing
SOFR
SOFR
SOFR
SOFR
SOFR
SOFR
SOFR
IBR
Financing
Financing
Financing
Financing
Financing
Financing
Financing
Financing
(1)
(2)
(3)
Benchmarked financings bear a variable interest at the applicable rate plus a margin.
Term conversion date in 2024 automatically rolling into a maturity of 2038.
Term conversion date in 2024 automatically rolling into a maturity of 2034.
Maturity
2026
2040
2030
2039
2039
2043
2024
2045
2058 - 2060
2033
2047
2038(2)
2026
2040
2033
2039
2041
2043
2024
2032
2033
2034(3)
2024
2024
2028
2024
2025
2028
2033
Carrying Value
$100 million
CNY 971 million ( $141 million)
CNY 200 million ($29 million)
CNY 70 million ( $10 million)
CNY 97 million ($14 million)
INR 10 billion ( $123 million)
BRL $450 million ($93 million)
CAD $30 million ($22 million)
$45 million
$311 million
$300 million ($60 million)
CAD $34 million ($23 million)
$175 million
CNY 273 million ($37 million)
COP 687 billion ($169 million)
CNY 1.5 billion ($203 million)
CNY 298 million ($42 million)
INR 7.4 billion ( $90 million)
BRL $800 million ($164 million)
$80 million
$125 million
$52 million
$140 million
$39 million
$48 million
$61 million
$200 million
$600 million
COP $100 billion ($25 million)
Page 131
In the second quarter of 2023, the Company extended the maturity of its $650 million credit facility associated with the United
States business to mature in 2026.
In the fourth quarter of 2023, the Company extended the maturity of its $46 million credit facility associated with US wind assets
to mature in 2024.
In the fourth quarter of 2023, the Company extended the maturity of its $64 million credit facility associated with US wind assets
to mature in 2030.
In the fourth quarter of 2023, the Company extended the maturity of its $25 million credit facility associated with the United
States business to mature in 2025.
In the fourth quarter of 2023, the Company extended the maturity of its $75 million credit facility associated with the US
distributed generation business to mature in 2024.
Supplemental Information
The following table outlines changes in Brookfield Renewable’s borrowings for the year ended December 31:
Net cash
flows from
financing
activities(1)
January 1
Non-cash
Acquisition Disposal
Transfer to
liabilities held
for sale Other(2)(3)(4)
December
31
(MILLIONS)
2023
2,548
Corporate borrowings ..... $
Non-recourse borrowings $ 22,302
2022
Corporate borrowings ..... $
2,149
Non-recourse borrowings $ 19,380
228
2,279
545
3,254
—
2,073
—
(164)
—
443
—
—
—
—
—
57 $
379 $
2,833
26,869
(146) $
2,548
(171)
(604) $
22,302
(1)
(2)
(3)
(4)
Excludes $307 million (2022: $233 million) of net cash flow from financing activities related to tax equity recorded on the consolidated
statements of cash flows.
Includes foreign exchange and amortization of unamortized premium and financing fees.
Includes $103 million (2022: $129 million) of non-recourse borrowings acquired through asset acquisitions.
Includes adjustments to purchase price allocations. Refer to Note 3 - Acquisitions for more details.
14. NON-CONTROLLING INTERESTS
Brookfield Renewable’s non-controlling interests are comprised of the following as at December 31:
(MILLIONS)
Participating non-controlling interests – in operating subsidiaries ................................................... $
2023
2022
18,863 $
14,755
General partnership interest in a holding subsidiary held by Brookfield .........................................
55
59
Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable
units held by Brookfield ............................................................................................................
BEPC exchangeable shares ...............................................................................................................
Preferred equity .................................................................................................................................
Perpetual subordinated notes ............................................................................................................
2,684
2,479
583
592
2,892
2,561
571
592
$
25,256 $
21,430
Page 132
Participating non-controlling interests – in operating subsidiaries
The net change in participating non-controlling interests – in operating subsidiaries is as follows:
(MILLIONS)
Brookfield
Americas
Infrastructure
Fund
Brookfield
Infrastructure
Fund II
Brookfield
Infrastructure
Fund III
Brookfield
Infrastructure
Fund IV
Brookfield
Infrastructure
Fund V
Brookfield
Global
Transition
Fund I
Brookfield
Global
Transition
Fund II
Canadian
Hydroelectric
Portfolio
The
Catalyst
Group
Isagen
institutional
partners
Isagen public
non-
controlling
interests
As at December 31,
2020 ............................. $
1,002
$
1,994
$
3,623
$
5
(122)
—
(181)
(18)
(1)
685
19
(103)
—
(54)
(71)
1
477
27
(43)
—
—
(388)
(25)
—
27
43
445
6
(214)
(32)
11
2,253
(31)
449
4
—
(59)
1
2,617
64
(96)
—
—
—
(123)
—
1
(16)
196
10
—
(350)
155
3,618
144
212
—
(21)
(460)
(3)
3,490
108
356
1
—
(32)
(695)
—
(14)
$
410
38
150
924
—
(114)
2
1,410
16
425
301
—
(3)
(15)
2,134
43
235
162
—
—
(172)
—
9
$
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
291
—
410
(140)
—
—
—
356
—
—
—
—
—
—
—
—
(50)
9
1,484
—
(14)
32
1,461
20
294
2,045
—
(26)
(81)
—
(31)
$
— $
627
$ 97
$ 2,651
$
—
—
—
—
—
—
—
—
—
—
—
—
—
—
1
(3)
298
—
—
—
—
—
4
163
—
—
(25)
205
974
20
187
—
—
16
28
—
—
(8)
(1)
132
11
(19)
—
—
(37)
(9)
4
—
1,148
115
15
2
—
—
—
7
3
—
—
—
113
(107)
—
—
(215)
—
2,442
179
67
—
—
(524)
(5)
2,159
98
603
—
—
—
(42)
(3)
(156)
—
165
—
—
—
—
14
1
—
—
—
(1)
(1)
13
1
1
—
—
(1)
—
14
1
4
—
—
—
(1)
—
—
Other
Total
$
682
$ 11,100
5
86
181
—
(47)
(131)
209
839
1,121
(395)
(810)
239
776
12,303
25
20
342
—
334
1,248
2,131
(75)
(97)
(1,275)
74
89
1,140
14,755
(56)
619
9
77
—
(3)
1,364
2,993
(140)
(449)
(130)
(1,428)
414
222
414
735
75
$
2,463
$
3,214
$
2,411
$
917
$
3,682
$
296 $
1,288
$ 122
$ 2,704
$
18
$
1,673
$ 18,863
75%-78%
43%-60%
69%-71%
75 %
71 %
77% - 80%
50% - 51%
50 %
25 %
77 %
0.3 % 0.3% - 72%
Net income(loss) ..........
Other comprehensive
income (loss) ...........
Capital contributions ....
Disposals ......................
Distributions(1)
.............
Other ............................
As at December 31,
2021 .............................
Net income (loss) .........
Other comprehensive
income (loss) ...........
Capital contributions ....
Disposals ......................
Distributions(1)
.............
Other ............................
As at December 31,
2022 .............................
Net income (loss) .........
Other comprehensive
income (loss) ...........
Capital contributions ....
Return of capital ..........
Disposals ......................
Distributions(1)
Acquisitions through
.............
business
combinations ...........
Other ............................
As at December 31,
2023 ............................. $
Interests held by third
parties ...........................
(1)
Distributions paid during the year ended December 31, 2023, totaled $870 million (2022: $1,275 million and 2021: $810 million).
Page 133
The following tables summarize certain financial information of operating subsidiaries that have non-controlling interests that are material to Brookfield Renewable:
(MILLIONS)
Brookfield
Americas
Infrastructure
Fund
Brookfield
Infrastructure
Fund II
Interests held by third parties
75%-78%
43%-60%
Brookfield
Infrastructure
Fund III(1)
69%-71%
Brookfield
Infrastructure
Fund IV
Brookfield
Infrastructure
Fund V
75 %
71 %
United States,
Brazil
United States,
Brazil,
Europe
United States,
Brazil, Europe,
India, China
United States,
Brazil,
India,
China
United States
Place of business ...................
Year ended December 31,
2021:
Brookfield
Global
Transition
Fund I
77% - 80%
North
America,
Europe, India,
China,
Australia
Canadian
Hydroelectric
Portfolio
The
Catalyst
Group
50 %
25 %
Isagen (2)
77 %
TerraForm
Power(3)
42 %
Onpath(4)
3%-51%
Canada
United
States
Colombia
North America,
South America,
Europe
United
Kingdom
Other
Total
0.3%-72%
North
America,
South
America,
China, India
Revenue ............................. $
Net income ........................
Total comprehensive
income (loss) .....................
Net income allocated to
non-controlling interests .......
Year ended December 31,
2022:
Revenue ............................. $
Net income (loss) ..............
Total comprehensive
income (loss) .....................
Net income allocated to
non-controlling interests .......
As at December 31, 2022:
Property, plant and
equipment,
at fair value ....................... $
Total assets ........................
Total borrowings ...............
Total liabilities ..................
Carrying value of
non-controlling interests .......
Year ended December 31,
2023:
Revenue ............................. $
Net income (loss) ..............
Total comprehensive
income (loss) .....................
Net income allocated to
non-controlling interests .......
As at December 31, 2023:
Property, plant and
equipment,
at fair value ....................... $
Total assets ........................
Total borrowings ...............
Total liabilities ..................
Carrying value of
non-controlling interests .......
$
137
7
(161)
5
$
302
64
895
43
$
120
25
$
324
(66)
(106)
19
732
(31)
$
131
852
14
240
477
$
6,223
6,368
1,332
1,618
2,617
$
56
34
$
339
118
(19)
27
(70)
64
$
$
$
$
195
1
348
2
213
44
183
31
2,873
3,529
1,051
1,172
1,675
192
79
306
56
106
$
5,878
$
2,919
$
112
12
18
75
6,055
1,320
1,609
2,463
3,662
1,159
1,249
1,713
$
$
$
$
316
50
252
38
451
14
586
16
6,060
6,911
3,120
4,173
2,134
533
46
362
43
7,293
8,396
3,704
5,117
2,411
—
—
—
—
—
—
—
—
—
—
—
—
—
45
411
411
291
2,357
2,538
462
1,611
917
$
$
$
$
$
$
$
$
—
—
—
—
54
(66)
(51)
(50)
1,565
5,298
497
3,502
1,461
145
26
409
20
$
4,700
$
9,535
1,169
5,424
3,682
81
10
329
4
116
40
403
20
130
31
28
16
2,463
2,747
144
192
$ 136
62
$
173
16
929
214
11
162
$
1,239
(245)
$
(243)
(109)
$ 131
44
$ 1,135
340
$
1,324
94
$
(32)
11
467
257
301
31
10,012
11,192
6,371
8,275
1,452
$
2,686
2,984
466
520
$ 1,031
1,053
476
491
$ 8,264
9,178
2,356
5,112
$
1,194
115
3,146
$ 102
27
$ 1,285
186
$
1,213
(27)
$
40
1,331
7
144
(93)
(43)
$
$
$
$
—
—
—
—
—
—
—
—
—
—
—
—
—
13
2
(4)
1
19
66
$ 3,354
229
187
1,791
48
209
170
45
$ 4,038
514
132
2,615
30
334
1,936
2,787
651
1,178
$ 40,781
50,152
16,334
26,281
484
14,755
230
(19)
$ 4,283
913
(172)
2,528
(7)
619
$ 1,024
$ 10,585
$
9,718
$
992
$
4,294
$ 52,336
1,036
11,601
439
447
3,000
6,498
1,332
122
3,948
10,528
6,056
9,106
847
1,261
5,429
62,909
295
630
335
2,036
19,796
2,845
34,756
1,018
18,863
(1)
(2)
(3)
(4)
Excludes information relating to Isagen and TerraForm Power which are presented separately.
The total third party ownership interest in Isagen as of December 31, 2023 was 77.4% and comprised of Brookfield Infrastructure Fund III: 23.0%, Brookfield Global Infrastructure Income Fund: 1.5%, Isagen Institutional
investors: 52.6% and other non-controlling interests: 0.3%.
The total third party interest in Terraform Power as of December 31, 2023 was 41.7% and comprised of Brookfield Infrastructure Fund III: 34.9% and Brookfield Global Infrastructure Income Fund: 6.8%.
The total third party interest in Onpath as of December 31, 2023 was 52.7% and comprised of Brookfield Global Transition Fund II: 49.7% and Brookfield Global Infrastructure Income Fund: 3.0%.
Page 134
General partnership interest in a holding subsidiary held by Brookfield, Participating non-controlling interests – in
a holding subsidiary – Redeemable/Exchangeable units held by Brookfield and Class A exchangeable shares of
Brookfield Renewable Corporation held by public shareholders and Brookfield
Brookfield, as the owner of the 1% GP interest in BRELP, is entitled to regular distributions plus an incentive
distribution based on the amount by which quarterly distributions exceed specified target levels. To the extent that
LP unit distributions exceed $0.20 per LP unit per quarter, the incentive is 15% of distributions above this threshold.
To the extent that quarterly LP unit distributions exceed $0.2253 per LP unit per quarter, the incentive distribution is
equal to 25% of distributions above this threshold.
Consolidated equity includes Redeemable/Exchangeable partnership units, BEPC exchangeable shares and the GP
interest. The Redeemable/Exchangeable partnership units and the GP interest are held 100% by Brookfield, the
BEPC exchangeable shares are held 25% by Brookfield Holders, with the remainder held by public shareholders.
The Redeemable/Exchangeable partnership units and BEPC exchangeable shares provide the holder, at its
discretion, with the right to redeem these units or shares, respectively, for cash consideration. Since this redemption
right is subject to Brookfield Renewable’s right, at its sole discretion, to satisfy the redemption request with LP units
of Brookfield Renewable on a one-for-one basis, the Redeemable/Exchangeable partnership units and BEPC
exchangeable shares are classified as equity in accordance with IAS 32, Financial Instruments: Presentation.
The Redeemable/Exchangeable partnership units, BEPC exchangeable shares and the GP interest are presented as
non-controlling interests since they relate to equity in a subsidiary that is not attributable, directly or indirectly, to
Brookfield Renewable. During the year ended December 31, 2023, exchangeable shareholders of BEPC exchanged
8,465 (December 31, 2022: 12,308) BEPC exchangeable for an equivalent number of LP units amounting to less
than $1 million (December 31, 2022: $1 million). No Redeemable/Exchangeable partnership units have been
redeemed.
On June 16, 2023, Brookfield Renewable completed the issuance of 8,200,000 LP Units and 7,430,000 BEPC
exchangeable shares on a bought deal basis at a price of $30.35 per LP Unit and $33.80 per BEPC exchangeable
Share for gross proceeds of $500 million.
The Redeemable/Exchangeable partnership units issued by BRELP and the BEPC exchangeable shares issued by
BEPC have the same economic attributes in all respects to the LP units issued by Brookfield Renewable, except for
the redemption rights described above. The Redeemable/Exchangeable partnership units, BEPC exchangeable shares
and the GP interest, excluding incentive distributions, participate in earnings and distributions on a per unit basis
equivalent to the per unit participation of the LP units of Brookfield Renewable.
As at December 31, 2023, Redeemable/Exchangeable partnership units, BEPC exchangeable shares and units of GP
interest outstanding were 194,487,939 units (December 31, 2022: 194,487,939 units), 179,651,526 (December 31,
2022: 172,218,098), and 3,977,260 units (December 31, 2022: 3,977,260 units), respectively.
In December 2023, Brookfield Renewable renewed its normal course issuer bid in connection with its LP units and
outstanding BEPC exchangeable shares. Brookfield Renewable is authorized to repurchase up to 14,361,497 LP
units and 8,982,586 BEPC exchangeable shares, representing 5% of each of its issued and outstanding LP units and
BEPC exchangeable shares. The bids will expire on December 17, 2024, or earlier should Brookfield Renewable
complete its repurchases prior to such date. During the year ended December 31, 2023, there were 1,856,044 LP
units (2022: nil) repurchased and cancelled at a total cost of $43 million (2022: nil). During the year ended
December 31, 2023 and 2022, there were nil BEPC exchangeable shares repurchased.
Page 135
The composition of the distributions are presented in the following table:
(MILLIONS)
2023
2022
2021
General partnership interest in a holding subsidiary held by Brookfield ............. $
5 $
6 $
Incentive distribution ............................................................................................
Participating non-controlling interests – in a holding subsidiary –
Redeemable/Exchangeable units held by Brookfield .......................................
BEPC exchangeable shares held by
Brookfield Holders ............................................................................................
External shareholders ........................................................................................
Total BEPC exchangeable shares .........................................................................
111
116
265
61
180
241
94
100
250
58
162
220
$
622 $
570 $
5
80
85
237
53
156
209
531
The following table summarizes certain financial information regarding General partnership interest in a holding
subsidiary held by Brookfield, Participating non-controlling interests – in a holding subsidiary – Redeemable/
Exchangeable units held by Brookfield and Class A exchangeable shares of Brookfield Renewable Corporation held
by public shareholders and Brookfield:
(MILLIONS)
For the year ended December 31:
2023
2022
2021
Revenue .................................................................................................................. $
5,038 $
4,711 $
4,096
Net income (loss) ....................................................................................................
Comprehensive income ..........................................................................................
Net income (loss) allocated to(1):
General partnership interest in a holding subsidiary held by Brookfield ...........
Participating non-controlling interests – in a holding subsidiary –
Redeemable/Exchangeable units held by Brookfield .....................................
BEPC exchangeable shares ................................................................................
616
2,036
111
(63)
(57)
138
2,628
92
(117)
(104)
(66)
2,700
77
(135)
(119)
As at December 31:
Property, plant and equipment, at fair value ........................................................... $
64,005 $
54,283
Total assets .............................................................................................................
Total borrowings .....................................................................................................
Total liabilities ........................................................................................................
Carrying value of (2):
76,128
29,702
46,149
64,111
24,850
37,825
General partnership interest in a holding subsidiary held by Brookfield ...........
Participating non-controlling interests – in a holding subsidiary –
Redeemable/Exchangeable units held by Brookfield .....................................
55
59
2,684
2,892
(1)
(2)
Allocated based on weighted-average GP interest, Redeemable/Exchangeable partnership units, BEPC exchangeable shares and LP units of
4.0 million, 194.5 million, 176.3 million and 282.4 million, respectively (2022: 4.0 million, 194.5 million, 172.2 million and 275.2 million,
respectively and 2021: 4.0 million, 194.5 million, 172.2 million and 274.9 million, respectively).
Allocated based on outstanding GP interest, Redeemable/Exchangeable partnership units, BEPC exchangeable shares and LP units of
4.0 million, 194.5 million, 179.7 million and 287.2 million, respectively (2022: 4.0 million, 194.5 million, 172.2 million and 275.4 million,
respectively).
Page 136
Preferred equity
Brookfield Renewable’s preferred equity as at December 31 consists of Class A Preference Shares of Brookfield
Renewable Power Preferred Equity Inc. (“BRP Equity”) as follows:
(MILLIONS, EXCEPT AS
NOTED)
Series 1 (C$136) .....
Series 2 (C$113)(1)
..
Series 3 (C$249) .....
Series 5 (C$103) .....
Series 6 (C$175) .....
Shares
outstanding
Cumulative
dividend
rate (%)
Earliest
permitted
redemption
date
Dividends declared for
the year ended
December 31
Carrying value as at
2023
2022
December 31, 2023
December 31, 2022
6.85
3.11
9.96
4.11
7.00
31.03
3.1 April 2025 $
4 $
4 $
129 $
7.8 April 2025
4.4
July 2024
5.0 April 2018
5.0
July 2018
4
8
4
7
3
8
4
7
58
187
77
132
$
27 $
26 $
583 $
126
57
183
76
129
571
(1)
Dividend rate represents annualized distribution based on the most recent quarterly floating rate.
Distributions paid during the year ended December 31, 2023, totaled $27 million (2022: $26 million and 2021:
$26 million).
The Class A Preference Shares do not have a fixed maturity date and are not redeemable at the option of the holders.
As at December 31, 2023, none of the issued Class A, Series 5 and 6 Preference Shares have been redeemed by BRP
Equity.
In December 2023, the Toronto Stock Exchange accepted notice of BRP Equity's intention to renew the normal
course issuer bid in connection with its outstanding Class A Preference Shares for another year to December 17,
2024, or earlier should the repurchases be completed prior to such date. Under this normal course issuer bid, BRP
Equity is permitted to repurchase up to 10% of the total public float for each respective series of the Class A
Preference Shares. Shareholders may receive a copy of the notice, free of charge, by contacting Brookfield
Renewable. There were no repurchases of Class A Preference Shares during 2023 or 2022 in connection with the
normal course issuer bid.
Perpetual subordinated notes
In April 2021 and December 2021, Brookfield BRP Holdings (Canada) Inc., a wholly-owned subsidiary of
Brookfield Renewable, issued $350 million and $260 million, respectively, of perpetual subordinated notes at a
fixed rate of 4.625% and 4.875%, respectively.
The perpetual subordinated notes do not have a maturity date and are repaid in an Event of Default. The perpetual
subordinated notes also provide Brookfield Renewable, at its discretion, the right to defer the interest (in whole or in
part) until liquidation of assets due to an Event of Default. The perpetual subordinated notes are classified as a
separate class of non-controlling interest on Brookfield Renewable's consolidated statements of financial position as
per IAS 32, Financial Instruments: Presentation. The interest expense on the perpetual subordinated notes during
the year ended December 31, 2023 of $29 million (2022: $29 million and 2021: $12 million) are presented as
distributions in the consolidated statements of changes in equity. The carrying value of the perpetual subordinated
notes, net of transaction cost, is $592 million (2022: $592 million) as at December 31, 2023.
Distributions paid during the year ended December 31, 2023, totaled $29 million (2022: $27 million and 2021:
$9 million).
Page 137
15. PREFERRED LIMITED PARTNERS’ EQUITY
Brookfield Renewable’s preferred limited partners’ equity comprises of Class A Preferred units as follows:
(MILLIONS, EXCEPT
AS NOTED)
Shares
outstanding
Cumulative
distribution
rate (%)
Earliest
permitted
redemption
date
Distributions declared
for the year ended
December 31
Carrying value as at
2023
2022
December 31, 2023
December 31, 2022
Series 7 (C$175) ......
Series 11 (C$250) ....
Series 13 (C$250) ....
Series 15 (C$175) ....
Series 17 ($200) .......
Series 18 (C$150)
7.00
—
10.00
7.00
8.00
6.00
38.00
5.50
January 2026
5.00
6.05
5.75
April 2022
April 2028
April 2024
5.25 March 2025
5.50
April 2027
7
—
9
7
11
7
7
3
10
8
11
5
128
—
196
126
195
115
$
41 $
44 $
760 $
128
—
196
126
195
115
760
In the second quarter of 2023, Brookfield Renewable declared the fixed quarterly distributions on the Class A
Preferred Limited Partnership Series 13 Units during the five years commencing May 1, 2023 will be paid at an
annual rate of 6.05%.
Distributions paid during the year ended December 31, 2023, totaled $41 million (2022: $44 million and 2021: $55
million).
Class A Preferred LP Units - Normal Course Issuer Bid
In December 2023, the Toronto Stock Exchange accepted notice of Brookfield Renewable's intention to renew the
normal course issuer bid in connection with the outstanding Class A Preferred Limited Partnership Units for another
year to December 17, 2024, or earlier should the repurchases be completed prior to such date. Under this normal
course issuer bid, Brookfield Renewable is permitted to repurchase up to 10% of the total public float for each
respective series of its Class A Preferred Limited Partnership Units. Unitholders may receive a copy of the notice,
free of charge, by contacting Brookfield Renewable. No shares were repurchased during 2023 or 2022.
16. LIMITED PARTNERS’ EQUITY
Limited partners’ equity
On June 16, 2023, Brookfield Renewable completed the issuance of 8,200,000 LP Units and 7,430,000 BEPC
Exchangeable shares on a bought deal basis at a price of $30.35 per LP Unit and $33.80 per BEPC Exchangeable
Share for gross proceeds of $500 million. Concurrently, a subsidiary of Brookfield Reinsurance purchased 5,148,270
LP units at the LP unit offering price (net of underwriting commission). The aggregate gross proceeds of the
offering and the concurrent private placement was approximately $650 million. Brookfield Renewable incurred
$20 million in related transaction costs inclusive of fees paid to underwriters.
As at December 31, 2023, 287,164,340 LP units were outstanding (2022: 275,358,750 LP units) including
74,339,049 LP units (2022: 68,749,416 LP units) held by Brookfield Holders. Brookfield owns all general
partnership interests in Brookfield Renewable representing a 0.01% interest.f the proceeds from the offering of LP units.
During the year ended December 31, 2023, 304,899 LP units (2022: 262,177 LP units) were issued under the
distribution reinvestment plan at a total value of $8 million (2022: $9 million).
During the year ended December 31, 2023, exchangeable shareholders of BEPC exchanged 8,465 BEPC
exchangeable shares (2022: 12,308 shares) for an equivalent number of LP units amounting to less than $1 million
(2022: less than $1 million).
As at December 31, 2023, Brookfield Holders held a direct and indirect interest of approximately 47% of Brookfield
Renewable on a fully-exchanged basis. Brookfield Holders held a direct and indirect interest of 313,640,823 LP
units, Redeemable/Exchangeable partnership units, and BEPC exchangeable shares, the remaining is held by public
investors.
Page 138
On an unexchanged basis, Brookfield Holders holds a 26% direct limited partnership interest in Brookfield
Renewable, a 40% direct interest in BRELP through the ownership of Redeemable/Exchangeable partnership units,
a direct 1% GP interest in BRELP and a 25% direct interest in the BEPC exchangeable shares of BEPC as at
December 31, 2023.
In December 2023, Brookfield Renewable renewed its normal course issuer bid in connection with its LP units and
outstanding BEPC exchangeable shares. Brookfield Renewable is authorized to repurchase up to 14,361,497 LP
units and 8,982,586 BEPC exchangeable shares, representing 5% of each of its issued and outstanding LP units and
BEPC exchangeable shares. The bids will expire on December 17, 2024, or earlier should Brookfield Renewable
complete its repurchases prior to such date. During the year ended December 31, 2023, there were 1,856,044 LP
units (2022: nil) repurchased and cancelled at a total cost of $43 million (2022: nil). During the year ended
December 31, 2023, Brookfield Corporation purchased 441,363 LP units (2022: nil). There were no BEPC
exchangeable shares repurchased during the years ended December 31, 2023 or 2022.
Distributions
The composition of the distributions are presented in the following table:
(MILLIONS)
2023
Brookfield Holders ............................................................................................................................ $
97 $
External LP unitholders ....................................................................................................................
286
$
383 $
2022
88
267
355
In February 2024, distributions to unitholders were increased to $1.42 per LP unit on an annualized basis, an
increase of $0.07 per LP unit, which will take effect on the distribution payable in March 2024.
Distributions paid during the year ended December 31, 2023, totaled $370 million (2022: $345 million and 2021:
$325 million).
17. GOODWILL
The following table provides a reconciliation of goodwill:
(MILLIONS)
Notes
Balance, as at December 31, 2021 ................................................................................................................
$
Acquisitions through business combinations ................................................................................................
3
Foreign exchange ..........................................................................................................................................
Balance, as at December 31, 2022 ................................................................................................................
Adjustments to purchase equation ................................................................................................................
Acquisitions through business combinations ................................................................................................
Disposal .........................................................................................................................................................
Foreign exchange and other ..........................................................................................................................
3
3
Total
966
691
(131)
1,526
(54)
340
(18)
150
Balance, as at December 31, 2023 ................................................................................................................
$
1,944
Page 139
Goodwill is allocated to the following CGUs or group of CGUs:
(MILLIONS)
2023
2022
Value-in-use method .....................................................................................................................
Europe Utility-scale solar Development(1)
Europe Wind .................................................................................................................................
.................................................................................... $
78 $
38
Europe Storage .............................................................................................................................
U.S. Utility-scale Solar .................................................................................................................
U.S. Distributed Generation(2)
......................................................................................................
U.S Wind ......................................................................................................................................
Chile Distributed Generation ........................................................................................................
India Wind ....................................................................................................................................
India Utility-scale Solar ................................................................................................................
India Distributed Generation ........................................................................................................
Fair value less costs of disposal ....................................................................................................
Europe Wind .................................................................................................................................
Europe Utility-scale Solar ............................................................................................................
South America Wind ....................................................................................................................
Colombia Hydroelectric(3)
...............................................................................................................
111
307
350
9
16
86
77
18
1,090
47
103
—
150
704
66
—
—
287
424
9
17
—
—
—
803
46
100
18
164
559
$
1,944 $
1,526
(1)
(2)
(3)
Includes $10 million (2022: nil) of goodwill related to a leading independent UK renewables developer with 260 MW onshore wind assets,
800 MW near-term development and another 3 GW of later stage projects acquired in 2023, and $68 million (2022: $66 million) of
goodwill related to a 1.7 GW portfolio of utility-scale solar development assets in Germany acquired in 2022.
Includes $115 million (2022: $115 million) of goodwill related to 360 MW of operating and 700 MW of development business acquired in
2021, $235 million (2022: $309 million) related to the acquisition of an integrated distributed generation developer with approximately 500
MW of contracted operating and under construction assets and an 1.8 GW of development pipeline in the United States acquired in 2022.
Goodwill related to the Colombia hydroelectric segment was created as a result of recording the deferred tax liabilities assumed in the
purchase price allocations of business combinations. The deferred tax liabilities are measured in accordance with IAS 12 in the purchase
price allocations rather than at fair value. As a result, the goodwill recorded does not represent ‘core’ goodwill, but rather goodwill created
as a result of accounting concepts or ‘non-core’ goodwill in order to avoid an immediate impairment of this ‘non-core’ goodwill.
As at December 31, 2023, Brookfield Renewable performed an impairment test at the level that goodwill is
monitored by management. Brookfield Renewable did not identify any impairments of goodwill. In performing this
impairment test, management removed the ‘non-core’ goodwill that continued to be supported by the existence of
the original deferred tax liability that gave rise to the goodwill from the carrying value of the applicable assets.
For the remaining goodwill balance, goodwill is determined by cash flow or fair value less costs of disposal models
where by the fair value measurement is classified as Level 3. The key inputs in determining the fair value of each
cash generating unit under the value in use model are the utilization of discount rates ranging from 10% to 14%
terminal capitalization rate of 2x to 6x, discrete cash flow periods from 2 to 6 years, and future leverage assumptions
for the platforms.
18. CAPITAL MANAGEMENT
Brookfield Renewable’s primary capital management objectives are to ensure the sustainability of its capital to
support continuing operations, meet its financial obligations, allow for growth opportunities and provide stable
distributions to its LP unitholders. Brookfield Renewable’s capital is monitored through the debt-to-total
capitalization ratio on a corporate and consolidated basis. As at December 31, 2023 these ratios were 12% and 40%,
respectively (2022: 11% and 39%, respectively).
Brookfield Renewable has provided covenants to certain of its lenders for its corporate borrowings and credit
facilities. The covenants require Brookfield Renewable to meet minimum debt-to-capitalization ratios. Subsidiaries
of Brookfield Renewable have provided covenants to certain of their lenders for their non-recourse borrowings.
These covenants vary from one credit agreement to another and include ratios that address debt-service coverage.
Page 140
Certain lenders have also put in place requirements that oblige Brookfield Renewable and its subsidiaries to
maintain debt and capital expenditure reserve accounts. The consequences to the subsidiaries as a result of failure to
comply with their covenants could include a limitation of distributions from the subsidiaries to Brookfield
Renewable, as well as repayment of outstanding debt. Brookfield Renewable is dependent on the distributions made
by its subsidiaries to service its debt.
Brookfield Renewable’s strategy during 2023, which was unchanged from 2022, was to maintain the measures set
out in the following schedule as at December 31:
(MILLIONS)
Commercial paper(1)
Debt
....................................................................... $
Medium-term notes(2)
Non-recourse borrowings(3)
..................................................................
.........................................................
Deferred income tax liabilities, net(4)
Equity
.............................................
Non-controlling interest ..............................................................
Preferred equity ...........................................................................
Perpetual subordinated notes .......................................................
Preferred limited partners’ equity ...............................................
Corporate
Consolidated
2023
2022
2023
2022
183
$
249
$
183
$
249
2,660
—
2,660
—
—
583
592
760
2,307
—
2,307
—
—
571
592
760
2,660
27,020
29,680
6,930
2,307
22,321
24,628
6,331
18,863
14,755
583
592
760
571
592
760
Unitholders’ equity ......................................................................
9,181
9,608
9,181
9,608
Total capitalization ......................................................................... $ 13,776
$ 13,838
$ 66,589
$ 57,245
Debt-to-total capitalization .............................................................
Debt-to-total capitalization (market value)(5)
.................................
19 %
12 %
17 %
11 %
45 %
40 %
43 %
39 %
(1)
Draws on corporate credit facilities and commercial paper issuances are excluded from the debt-to-total capitalization ratios as they are not
a permanent source of capital.
(2) Medium-term notes are unsecured and guaranteed by Brookfield Renewable and excludes $10 million (2022: $8 million) of deferred
(3)
(4)
(5)
financing fees, net of unamortized premiums.
Consolidated non-recourse borrowings include $2,626 million (2022: $1,838 million) borrowed under a subscription facility of a Brookfield
sponsored private fund and excludes $140 million (2022: $124 million) of deferred financing fees and $11 million (2022: $105 million) of
unamortized premiums.
Deferred income tax liabilities less deferred income tax assets.
Based on market values of Preferred equity, Perpetual subordinated notes, Preferred limited partners’ equity and Unitholders’ equity.
Page 141
19. EQUITY-ACCOUNTED INVESTMENTS
The following table outlines the changes in Brookfield Renewable’s equity-accounted investments:
(MILLIONS)
2023
2022
Balance, beginning of year .................................................................................... $
1,392 $
1,107 $
Acquisitions through business combinations .........................................................
Investment(1)(2)(3)(4)
Return of capital .....................................................................................................
..................................................................................................
Share of net income ...............................................................................................
Share of other comprehensive income (loss) .........................................................
Dividends received .................................................................................................
Change in basis of accounting(5)
Foreign exchange translation and other .................................................................
............................................................................
44
700
—
186
162
(58)
105
15
—
373
(3)
96
(65)
(89)
—
(27)
2021
971
—
57
(8)
22
148
(78)
—
(5)
Balance, end of year ............................................................................................... $
(1)
(2)
(3)
(4)
(5)
Includes additional subscription for shares in Powen. Refer to Note 3 - Acquisitions for more details.
Includes the investment in an India sustainable agricultural solutions company. Refer to Note 3 - Acquisitions for more details.
Includes Brookfield Renewable’s incremental investment in X-Elio. Refer to Note 3 - Acquisitions for more details.
Includes Brookfield Renewable’s incremental investment in Westinghouse. Refer to Note 3 - Acquisitions for more details.
Includes the recognition of a 378 MW operating hydroelectric portfolio in the U.S. Refer to Note 4 - Disposal of assets for more details.
2,546 $
1,392 $
1,107
The following table presents the ownership interests and carrying values of Brookfield Renewable’s investments in
associates and joint ventures, all of which are accounted for using the equity method:
Ownership Interest
Carrying Value
Hydroelectric ...............................................................................
14%-50%
14%-50% $
Wind ............................................................................................
25%-50%
25%
Utility-scale solar ........................................................................
25%-65%
25%-65%
Distributed energy & Storage ......................................................
25%-50%
25%-50%
Sustainable solutions ...................................................................
4%-49%
8%-49%
2023
2022
$
2023
225
159
304
1,049
809
2022
111
108
107
815
251
$
2,546
$
1,392
The following table presents total assets, as well as total liabilities of Brookfield Renewable’s investments in
associates and joint ventures:
Total Assets
Total Liabilities
Hydroelectric ............................................................................... $
1,221 $
550 $
Wind ............................................................................................
Utility-scale solar ........................................................................
Distributed energy & Storage ......................................................
Sustainable solutions ...................................................................
1,019
2,884
5,010
7,757
472
457
4,248
2,890
2023
2022
$
2023
422
383
1,160
2,109
1,564
$
17,891 $
8,617 $
5,638
$
2022
223
20
70
1,944
1,140
3,397
Page 142
The following table presents total revenues, net income and other comprehensive income (“OCI”) of Brookfield
Renewable’s investments in associates and joint ventures:
(MILLIONS)
2023
Net
income
(loss)
Revenues
2022
Net
income
(loss)
OCI
Revenues
OCI
Revenues
2021
Net
income
(loss)
Hydroelectric ................. $
105 $
74 $
(14) $
18 $
69 $
(73) $
16 $
OCI
(15) $ 170
Wind ..............................
Utility-scale solar ..........
Distributed energy &
Storage .......................
Sustainable solutions .....
—
28
604
1,016
3
478
210
46
21
63
373
62
—
—
582
363
68
(24)
42
2
240
11
(54)
—
—
—
449
—
20
2
(18) (53)
92
—
256
—
$ 1,753 $
811 $
505 $
963 $
364 $
(83) $
465 $
79 $ 375
20. CASH AND CASH EQUIVALENTS
Brookfield Renewable’s cash and cash equivalents as at December 31 are as follows:
(MILLIONS)
2023
Cash................................................................................................................................................... $
821 $
Cash subject to restriction .................................................................................................................
Short-term deposits ...........................................................................................................................
251
69
$
1,141 $
2022
728
268
2
998
21. RESTRICTED CASH
Brookfield Renewable’s restricted cash as at December 31 is as follows:
(MILLIONS)
Note
2023
2022
Operations .........................................................................................................................
$
299 $
Credit obligations ...............................................................................................................
Capital expenditures and development projects ................................................................
Total ...................................................................................................................................
Less: non-current ...............................................................................................................
23
79
13
391
(81)
Current ...............................................................................................................................
$
310 $
93
56
42
191
(52)
139
Page 143
22. TRADE RECEIVABLES AND OTHER CURRENT ASSETS
Brookfield Renewable’s trade receivables and other current assets as at December 31 are as follows:
(MILLIONS)
2023
Trade receivables .............................................................................................................................. $
662 $
Inventory ...........................................................................................................................................
Collateral deposits(1)
Prepaids and others ...........................................................................................................................
..........................................................................................................................
Sales tax receivable ...........................................................................................................................
Income tax receivables ......................................................................................................................
Current portion of contract asset .......................................................................................................
Short term deposits and advances ....................................................................................................
Other short-term receivables .............................................................................................................
111
178
127
94
74
61
23
187
2022
672
42
609
86
73
74
54
113
137
$
1,517 $
1,860
(1)
Collateral deposits are related to energy derivative contracts that Brookfield Renewable enters into in order to mitigate the exposure to
wholesale market electricity prices on the future sale of uncontracted generation, as part of Brookfield Renewable's risk management
strategy.
As at December 31, 2023, 86% (2022: 89%) of trade receivables were current. Brookfield Renewable does not
expect issues with collectability of these amounts. Accordingly, as at December 31, 2023 and 2022 an allowance for
doubtful accounts for trade receivables was not deemed necessary. Trade receivables are generally on 30-day terms
and credit limits are assigned and monitored for all counterparties. In determining the recoverability of trade
receivables, management performs a risk analysis considering the type and age of the outstanding receivables and
the credit worthiness of the counterparties. Management also reviews trade receivable balances on an ongoing basis.
23. OTHER LONG-TERM ASSETS
Brookfield Renewable’s other long-term assets as at December 31 are as follows:
(MILLIONS)
Note
2023
2022
Contract asset .....................................................................................................................
$
314 $
Long-term receivables ........................................................................................................
Due from related parties .....................................................................................................
Restricted cash ....................................................................................................................
Intangibles(1)
.......................................................................................................................
Other ...................................................................................................................................
28
21
382
135
81
15
84
341
235
128
52
209
86
$
1,011 $
1,051
(1)
Relates to certain power generating facilities that operate under service concession arrangements.
At December 31, 2023 and 2022, restricted cash was held primarily to satisfy operations and maintenance reserve
requirements, lease payments and credit agreements.
Contract assets are the result of contract amendments made to Brookfield Renewable’s long-term power purchase
agreements with Brookfield associated with generating assets in Ontario held by Great Lakes Power Limited and
Mississagi Power Trust. The net impact of these changes were offset by changes to Brookfield Renewable’s long-
term energy revenue agreement with Brookfield associated with several entities owned by Brookfield Renewable in
the United States, however the changes resulted in a difference in timing of cash flows. As a result, the amendments
were accounted for in reflection of their substance, with the recognition of contract asset and liability balances and
net financing charges to be recognized over the remainder of the term of the agreements. There are no material
provisions for expected credit losses on contract assets. See Note 28 – Related party transactions, for additional
details regarding Brookfield Renewable’s revenue agreements with Brookfield.
Page 144
On September 20, 2023, Brookfield Renewable, together with its institutional partners, completed the sale of its
100% interest in a 95 MW portfolio of wind assets in Uruguay that operated under a service concession arrangement.
See Note 4 – Disposal of assets, for additional details.
24. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
Brookfield Renewable’s accounts payable and accrued liabilities as at December 31 are as follows:
(MILLIONS)
2023
Operating accrued liabilities ............................................................................................................. $
603 $
Accounts payable ..............................................................................................................................
Interest payable on borrowings .........................................................................................................
LP Unitholders distributions, preferred limited partnership unit distributions, preferred
dividends payable, perpetual subordinate notes distributions and exchange shares dividends(1)
.
Current portion of lease liabilities .....................................................................................................
Income tax payable ...........................................................................................................................
Current portion of contract liability ..................................................................................................
Other .................................................................................................................................................
388
301
58
41
41
35
72
2022
440
276
153
53
33
78
24
29
(1)
Includes amounts payable only to external LP unitholders and BEPC exchangeable shareholders. Amounts payable to Brookfield are
included in due to related parties.
$
1,539 $
1,086
25. PROVISIONS
The following table presents the change in the decommissioning liabilities for Brookfield Renewable:
(MILLIONS)
Balance, beginning of the year ......................................................................................................... $
Acquisitions through business combinations ...................................................................................
Disposal ............................................................................................................................................
Accretion ..........................................................................................................................................
Changes in estimates(1)
Foreign exchange .............................................................................................................................
.....................................................................................................................
Other ................................................................................................................................................
2023
479 $
227
(1)
13
253
6
(1)
976 $
2022
668
54
(1)
15
(245)
(12)
—
479
Balance, end of the year ................................................................................................................... $
(1)
Changes in estimates are driven by changes in underlying assumptions used as inputs to determine the value of the retirement obligation.
Brookfield Renewable has recorded decommissioning retirement obligations associated with certain power
generating assets. The decommissioning retirement obligation has been established for hydroelectric, wind and solar
operation sites that are substantially expected to be restored between the years 2031 to 2058. The estimated cost of
decommissioning activities is based on a third-party assessment.
For details on other legal provisions, please refer to Note 27 – Commitments, contingencies and guarantees.
Provisions also includes contingent and deferred acquisition consideration of $249 million (2022: $68 million).
Page 145
26. OTHER LONG-TERM LIABILITIES
Brookfield Renewable’s other long-term liabilities as at December 31 are comprised of the following:
(MILLIONS)
2023
Contract liabilities ..........................................................................................................................
$
680 $
Lease liabilities ...............................................................................................................................
Regulatory liabilities(1)
Pension obligations ........................................................................................................................
...................................................................................................................
Concession payment liability .........................................................................................................
Other ...............................................................................................................................................
727
104
66
2
185
$
1,764 $
2022
662
526
149
51
10
132
1,530
(1)
Regulatory liabilities are related to the regulated pricing mechanism at certain of Brookfield Renewable’s Spanish assets.
Contract liabilities are the result of the amendment to the energy revenue agreement between Brookfield and several
entities owned by Brookfield Renewable in the United States. See Note 23 – Other long-term assets, for additional
details regarding Brookfield Renewable’s contract balances. See Note 28 – Related party transactions, for additional
details regarding Brookfield Renewable’s revenue agreements with Brookfield.
27. COMMITMENTS, CONTINGENCIES AND GUARANTEES
Commitments
In the course of its operations, Brookfield Renewable and its subsidiaries have entered into agreements for the use of
water, land and dams. Payment under those agreements varies with the amount of power generated. The various
agreements can be renewed and are extendable up to 2089.
In the normal course of business, Brookfield Renewable will enter into capital expenditure commitments which
primarily relate to contracted project costs for various growth initiatives. As at December 31, 2023, Brookfield
Renewable had $2,783 million (2022: $1,126 million) of capital expenditure commitments outstanding, of which
$2,200 million (2022: $1,059 million) is payable in less than one year, $583 million (2022: $63 million) in two to
five years, and less than $1 million (2022: $4 million) thereafter.
The following table lists the assets and portfolio of assets that Brookfield Renewable, together with institutional
partners have agreed to acquire which are subject to customary closing conditions as at December 31, 2023:
Region Technology
Capacity
China
Wind
102 MW development
China
Wind
350 MW development
Consideration
CNY $84 million
($16 million)
CNY $577 million
($110 million)
Brazil
US
US
Distributed
energy &
storage
Distributed
energy &
storage
Distributed
energy &
storage
730 MW development
R$136 millions ($28
million)
25 MW development
$20 million
93 MW development
$86 million
Brookfield
Renewable
Economic
Interest
20%
20%
20%
25%
20%
Expected Close
Q4 2024
Q4 2024
2024 - 2026
Q1 2024
Q1 2024
Page 146
An integral part of Brookfield Renewable’s strategy is to participate with institutional partners in Brookfield-
sponsored private equity funds that target acquisitions that suit Brookfield Renewable’s profile. In the normal course
of business, Brookfield Renewable has made commitments to Brookfield-sponsored private equity funds to
participate in these target acquisitions in the future, if and when identified. From time to time, in order to facilitate
investment activities in a timely and efficient manner, Brookfield Renewable will fund deposits or incur other costs
and expenses (including by use of loan facilities to consummate, support, guarantee or issue letters of credit) in
respect of an investment that ultimately will be shared with or made entirely by Brookfield sponsored vehicles,
consortiums and/or partnerships (including private funds, joint ventures and similar arrangements), Brookfield
Renewable, or by co-investors.
Contingencies
Brookfield Renewable and its subsidiaries are subject to various legal proceedings, arbitrations and actions arising in
the normal course of business. While the final outcome of such legal proceedings and actions cannot be predicted
with certainty, it is the opinion of management that the resolution of such proceedings and actions will not have a
material impact on Brookfield Renewable’s consolidated financial position or results of operations.
Brookfield Renewable, on behalf of Brookfield Renewable’s subsidiaries, and the subsidiaries themselves have
provided letters of credit, which include, but are not limited to, guarantees for debt service reserves, capital reserves,
construction completion and performance. The activity on the issued letters of credit by Brookfield Renewable can
be found in Note 13 – Borrowings.
Brookfield Renewable, along with institutional partners, has provided letters of credit, which include, but are not
limited to, guarantees for debt service reserves, capital reserves, construction completion and performance as it
relates to interests in the Brookfield Americas Infrastructure Fund, the Brookfield Infrastructure Fund II, Brookfield
Infrastructure Fund III, Brookfield Infrastructure Fund IV, Brookfield Infrastructure Fund V, Brookfield Global
Transition Fund and Brookfield Global Transition Fund II. Brookfield Renewable’s subsidiaries have similarly
provided letters of credit, which include, but are not limited to, guarantees for debt service reserves, capital reserves,
construction completion and performance.
Letters of credit issued by Brookfield Renewable along with institutional partners and its subsidiaries were as at the
following dates:
(MILLIONS)
2023
Brookfield Renewable along with institutional partners ................................................................. $
100 $
Brookfield Renewable's subsidiaries ...............................................................................................
2,026
$
2,126 $
2022
99
1,510
1,609
Guarantees
In the normal course of operations, Brookfield Renewable and its subsidiaries execute agreements that provide for
indemnification and guarantees to third-parties of transactions such as business dispositions, capital project
purchases, business acquisitions, power marketing activities such as purchase and sale agreements, swap
agreements, credit facilities of certain Brookfield private funds and that are also secured by committed capital of our
third-party institutional partners, and sales and purchases of assets and services. Brookfield Renewable has also
agreed to indemnify its directors and certain of its officers and employees. The nature of substantially all of the
indemnification undertakings prevents Brookfield Renewable from making a reasonable estimate of the maximum
potential amount that Brookfield Renewable could be required to pay third parties as the agreements do not always
specify a maximum amount and the amounts are dependent upon the outcome of future contingent events, the nature
and likelihood of which cannot be determined at this time. Historically, neither Brookfield Renewable nor its
subsidiaries have made material payments under such indemnification agreements.
Page 147
28. RELATED PARTY TRANSACTIONS
Brookfield Renewable’s related party transactions are recorded at the exchange amount and are primarily with
Brookfield.
Brookfield Renewable and Brookfield have entered into, or amended, the following material agreements:
Principal Agreements
Limited Partnership Agreements
Each of the amended and restated limited partnership agreements of Brookfield Renewable and BRELP outline the
key terms of the partnerships, including provisions relating to management, protections for limited partners, capital
contributions, distributions and allocation of income and losses. BRELP’s general partner is entitled to receive
incentive distributions from BRELP as a result of its ownership of the general partnership interest in BRELP. The
incentive distributions are to be calculated in increments based on the amount by which quarterly distributions on
the limited partnership units of BRELP exceed specified target levels as set forth in the amended and restated
partnership agreement.
Master Services Agreement
Brookfield Renewable entered into an agreement with Brookfield Corporation pursuant to which Brookfield
Corporation has agreed to provide oversight of the business and provide the services of senior officers to Brookfield
Renewable for a management service fee. The fee is paid on a quarterly basis and has a fixed quarterly component
of $5 million and a variable component calculated as a percentage of the increase in the total capitalization value of
Brookfield Renewable over an initial reference value (subject to an annual escalation by a specified inflation factor
beginning on January 1, 2013). Total capitalization value as of December 31, 2023 is $22 billion, which against the
initial reference value of $8 billion and factoring in the annual amount of $26 million (as adjusted for inflation),
resulted in a management service fee payment for the year ended December 31, 2023 of $205 million (2022:
$243 million and 2021: $288 million).
Relationship Agreement
Since inception, Brookfield Renewable has had a Relationship Agreement with Brookfield pursuant to which
Brookfield has agreed, subject to certain exceptions, that Brookfield Renewable will serve as its primary vehicle
through which it will directly or indirectly, acquire renewable power assets on a global basis.
BRELP Voting Agreement
In 2011, Brookfield Renewable entered into a voting agreement with Brookfield pursuant to which Brookfield
Renewable, through BRPL, has a number of voting rights, including the right to direct all eligible votes in the
election of the directors of BRELP’s general partner.
Power Services Agreements
Power Agency Agreements
Certain Brookfield Renewable subsidiaries entered into Power Agency Agreements appointing Brookfield as their
exclusive agent in respect of the sale of electricity, including the procurement of transmission and other additional
services. In addition, Brookfield scheduled, dispatched and arranged for transmission of the power produced and the
power supplied to third-parties in accordance with prudent industry practice. Pursuant to each Agreement,
Brookfield was entitled to be reimbursed for any third party costs incurred, and, in certain cases, received an
additional fee for its services in connection with the sale of power and for providing the other services.
On closing of the Energy Marketing Internalization, all Power Agency Agreements were transferred by Brookfield
to Brookfield Renewable.
Page 148
Revenue Agreements
Contract Amendments
In the first quarter of 2021, two long-term power purchase agreements for sale of energy generated by hydroelectric
facilities owned by Great Lakes Power Limited (“GLPL”) and Mississagi Power Trust (“MPT”) were amended and
Brookfield’s third-party power purchase agreements associated the sale energy generated by GLPL and MPT were
reassigned.
Historically, the power purchase agreements required Brookfield to purchase energy generated by GLPL and MPT
at an average price of C$100 per MWh and C$127 per MWh, respectively, both subject to an annual adjustment
equal to a 3% fixed rate. The GLPL and MPT contracts with Brookfield each had an initial term to December 1,
2029, and Brookfield Renewable will have an option to extend a fixed price commitment to GLPL from Brookfield
through 2044 at a price of C$60 per MWh. There were no changes to the terms following the assignment of the
third-party power purchase agreements from Brookfield to GLPL and MPT.
There were no amendments to or termination of the agreement that gives Brookfield Renewable the option to extend
a fixed price commitment to GLPL from Brookfield from December 1, 2029 through 2044 at a price of C$60 per
MWh.
Energy Revenue Agreement
In 2018, the energy revenue agreement between Brookfield and several entities owned by Brookfield Renewable
was effectively amended.
Brookfield will support the price that Brookfield Renewable receives for energy generated by certain facilities in the
United States at a price $75 per MWh. This price is to be increased annually on January 1 until 2021 by an amount
equal to 40% of the increase in the CPI during the previous calendar year, but not exceeding an increase of 3% in
any calendar year. The price will be reduced by $3 per MWh per year from 2021 to 2025 and then further reduced
by $5.03 per MWh in 2026. The energy revenue agreement will terminate in 2046 and provides Brookfield the right
to terminate the agreement in 2036.
Other Revenue Agreements
Pursuant to a power guarantee agreement, Brookfield purchased all energy from the two facilities of Hydro Pontiac
Inc. at a price of C$68 per MWh, increased annually each calendar year beginning in 2010 by an amount equal to
40% of the increase in the CPI during the previous calendar year. This power guarantee agreement was scheduled to
commence in 2019 for one facility and in 2020 for the other, upon the expiration of existing third-party power
agreements. The agreement with Brookfield had an initial term to 2029 and automatically renewed for a successive
20-year period with certain termination provisions. On closing of the Energy Marketing Internalization, the power
guarantee agreement with Hydro Pontiac Inc. was transferred to Brookfield Renewable.
In addition, Brookfield Renewable from time to time may enter into other power purchase agreements with
Brookfield and its subsidiaries to deliver electricity, attributes related to generation and other related services. These
agreements are typically entered into at market rates.
Voting Agreements
Brookfield Renewable entered into voting agreements with Brookfield whereby Brookfield, as managing member of
entities related to the Brookfield Americas Infrastructure Fund (the “BAIF Entities”) in which Brookfield
Renewable holds investments in power generating operations with institutional partners, agreed to assign to
Brookfield Renewable their voting rights to elect the Boards of Directors of the BAIF Entities. Brookfield
Renewable’s economic interests in the BAIF Entities in the United States and Brazil are 22% and 25%, respectively.
Brookfield Renewable entered into voting agreements with certain Brookfield subsidiaries whereby these
subsidiaries, as managing members of entities related to Brookfield Infrastructure Fund II (the “BIF II Entities”) in
which Brookfield Renewable holds investments in power generating operations with institutional partners, agreed to
provide to Brookfield Renewable the authority to direct the election of the Boards of Directors of the BIF II
Entities. Brookfield Renewable’s economic interests in the BIF II Entities are between 40% and 50.1%.
Page 149
Except as set out below in respect to TerraForm Power and Isagen, Brookfield Renewable entered into voting
agreements with certain Brookfield subsidiaries as managing members of entities related to Brookfield Infrastructure
Fund III (the “BIF III Entities”) in which Brookfield Renewable holds investments in power generating operations
with institutional partners, Brookfield agreed to provide to Brookfield Renewable the authority to direct the election
of the Boards of Directors of the BIF III Entities. Brookfield Renewable’s economic interests in the BIF III Entities
are between 23% and 31%.
Brookfield Renewable holds its interest in its Colombian operations as part of a consortium. The consortium in turn
holds its interest in Isagen through an entity (“Hydro Holdings”) which is entitled to appoint a majority of the board
of directors of Isagen. The general partner of Hydro Holdings is a controlled subsidiary of Brookfield
Renewable. Brookfield Renewable is entitled to appoint a majority of Hydro Holdings’ board of directors, provided
that Brookfield Corporation and its subsidiaries (including Brookfield Renewable) collectively are (i) the largest
holder of Hydro Holdings’ limited partnership interests, and (ii) hold over 30% of Hydro Holdings’ limited
partnership interests. Brookfield Renewable currently meets this ownership test and is entitled to appoint a majority
of the board of directors.
Simultaneously with the completion of the TerraForm Power acquisition, Brookfield Renewable entered into voting
agreements with a controlled affiliate of Brookfield to transfer the power to vote their respective shares held of
TerraForm Power to Brookfield Renewable. As a result, Brookfield Renewable controls and consolidates TerraForm
Power.
Brookfield Renewable entered into voting agreements with certain Brookfield subsidiaries whereby these
subsidiaries, as managing members of entities related to Brookfield Infrastructure Fund IV (the “BIF IV Entities”)
and Brookfield Infrastructure Fund V (the “BIF V Entities”) in which Brookfield Renewable holds investments in
power generating operations with institutional partners, agreed to provide to Brookfield Renewable the authority to
direct the election of the Boards of Directors of the BIF IV Entities. Brookfield Renewable’s economic interests in
the BIF IV Entities is 25% and expects to hold on average 25% in BIF V Entities.
Brookfield Renewable entered into voting agreements with certain Brookfield subsidiaries whereby these
subsidiaries, as managing members of entities related to Brookfield Global Transition Fund (the “BGTF Entities”)
and Brookfield Global Transition Fund II (the “BGTF II Entities”), agreed to provide to Brookfield Renewable the
authority to direct the election of the Boards of Directors of the BGTF Entities, giving Brookfield Renewable control
or significant influence over the entities that own certain renewable power and sustainable solution investments with
institutional partners. Brookfield Renewable’s economic interest in BGTF I Entities is 20% and expects to hold 20%
in BGTF II Entities.
Brookfield Renewable entered into a voting agreement with Brookfield to gain control of BGTF Finco LLC, the
primary borrower under the Brookfield Global Transition Fund subscription facility. The voting agreements provide
Brookfield Renewable with control and accordingly, Brookfield Renewable consolidates the accounts of this entity.
Other Agreements
Credit facilities and funds on deposit
Brookfield Corporation has provided a $400 million committed unsecured revolving credit facility maturing in
December 2024 and the draws bear interest at the Secured Overnight Financing Rate plus a margin. As at
December 31, 2023, there were no draws on the committed unsecured revolving credit facility provided by
Brookfield Corporation. Brookfield Corporation may from time to time place funds on deposit with Brookfield
Renewable which are repayable on demand including any interest accrued. There were nil funds placed on deposit
with Brookfield Renewable as at December 31, 2023 (2022: nil). The interest expense on the deposit and draws from
the credit facility for the year ended December 31, 2023 totaled nil (2022: nil and 2021: $2 million).
Brookfield Renewable participates with institutional partners in Brookfield Americas Infrastructure Fund,
Brookfield Infrastructure Fund II, Brookfield Infrastructure Fund III, Brookfield Infrastructure Fund IV, Brookfield
Infrastructure Fund V, Brookfield Infrastructure Income Fund, Brookfield Global Transition Fund, Brookfield
Global Transition Fund II, and Brookfield Infrastructure Debt Fund (“Private Funds”), each of which is a Brookfield
sponsored fund, and in connection therewith, Brookfield Renewable, together with its institutional partners, has
access to financing using the Private Funds’ credit facilities.
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From time to time Brookfield Reinsurance and its related entities may participate in capital raises undertaken by
Brookfield Renewable. These financings are typically provided at the market rates and as at December 31, 2023,
$101 million of non-recourse borrowings (2022: $93 million) and $8 million of corporate borrowings (2022:
$7 million) were due to Brookfield Reinsurance. Brookfield Reinsurance has also subscribed to tax equity financing
of $2 million (2022: $3 million) and preferred limited partners equity of $11 million (2022: $11 million). As at
December 31, 2023, Brookfield Renewable had $450 million (2022: $321 million) of borrowings from Brookfield
Reinsurance classified as due to related party.
Subsidiaries of Brookfield Reinsurance may from time to time decide to participate in Brookfield Renewable’s
equity offerings. For example, in June 2023, a subsidiary of Brookfield Reinsurance participated in a private
placement of LP units. Refer to Note 16 Limited partners’ equity for from more details.
TERP Ownership Transfer
On December 28, 2023 a subsidiary of Brookfield Renewable transferred 13.75% of its interest in TerraForm Power
to BEPC, a consolidated subsidiary. The intercompany transfer had no net impact to Brookfield Renewable’s
financial statements. Brookfield Renewable continues to control and consolidate Terraform Power and there was no
impact to its economic ownership. In conjunction with the transfer, Terraform Power declared a non-cash dividend
to its shareholders resulting in a decrease of $483 million in Equity and an increase in due to related parties of
$483 million.
Other Agreements
In 2011, on formation of Brookfield Renewable, Brookfield transferred certain development projects to Brookfield
Renewable for no upfront consideration but is entitled to receive variable consideration on commercial operation or
sale of these projects.
On November 7, 2023, Brookfield Renewable, together with institutional partners, through a strategic partnership
with Cameco Corporation, acquired 100% of Westinghouse, one of the world’s largest nuclear services businesses,
from our affiliate Brookfield Business Partners L.P. and its institutional partners, for $4.37 billion ($442 million net
to Brookfield Renewable). Brookfield Renewable, together with institutional partners, own an aggregate 51%
interest (10.11% net to Brookfield Renewable) with Cameco owning 49%. Refer to Note 3 - Acquisitions for more
details.
On December 29, 2023, a subsidiary of Brookfield transferred its indirect 8% economic interest in a greenhouse gas
monitoring and ESG certification software investment that it held through Brookfield Technology Growth Partners
III to Brookfield Renewable for $20 million. The investment is recognized as a financial instrument on the statement
of financial position.
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The following table reflects the related party agreements and transactions in the consolidated statements of income
(loss), for the years ended December 31:
(MILLIONS)
Revenues
2023
2022
2021
Power purchase and revenue agreements ........................................................... $
14 $
21 $
103
Direct operating costs
Energy marketing fee & other services ..............................................................
Insurance services(1)
...........................................................................................
(5)
—
(1)
—
Interest expense
Borrowings ......................................................................................................... $
Contract balance accretion .................................................................................
$
Other
Distribution income ............................................................................................ $
Other related party services ................................................................................ $
Financial instrument gain/(loss) ......................................................................... $
(35) $
(26)
(61) $
8 $
3 $
21 $
— $
(20)
(20) $
— $
(5) $
5 $
(8)
(26)
(2)
(21)
(23)
—
(4)
—
Management service costs ..................................................................................... $
(1)
(205) $
(243) $
(288)
Prior to November 2021, insurance services were paid to external insurance service providers through subsidiaries of Brookfield
Corporation. The fees paid to the subsidiaries of Brookfield Corporation in 2023 were nil (2022 was nil and 2021: was nil). As of November
2021, Brookfield, through a regulated subsidiary, began providing insurance coverage through third-party commercial insurers for the
benefits of certain entities in North America. The premiums and claims paid are not included in the table above.
Page 152
statements
The following table reflects the impact of the related party agreements and transactions on the consolidated
31:
2022
position
Related party
December
2023
financial
of
as
at
(MILLIONS)
Current assets
Trade receivables and other current assets
Contract asset
Brookfield ................................................
$
61 $
54
Due from related parties
Amounts due from
Non-current assets
Financial instrument assets
Other long-term assets
Contract asset
Due from related parties
Current liabilities
Contract Liability
Brookfield(1)
............................................
Equity-accounted investments and other .
Brookfield ................................................
1,386
57
1,443
170
105
18
123
395
Brookfield ................................................
314
341
Equity-accounted investments and other .
Brookfield ................................................
Financial instrument liabilities
Brookfield Reinsurance ...........................
Due to related parties
Amounts due to
Accrued distributions payable on LP units,
BEPC exchangeable shares, Redeemable/
Exchangeable partnership units and GP
interest
Non-current liabilities
Financial instrument liabilities
Due to related parties
Amounts due to
Brookfield(1)
............................................
Equity-accounted investments and other .
Brookfield Reinsurance ...........................
Brookfield ................................................
Brookfield Reinsurance ...........................
Brookfield(2)
............................................
Equity-accounted investments and other .
Corporate borrowings
Brookfield Reinsurance ...........................
Non-recourse borrowings
Brookfield Reinsurance and associates ...
135
35
2
541
13
242
39
835
2
496
209
705
8
101
128
24
3
205
24
321
38
588
3
—
1
1
7
93
Other long-term liabilities
Contract liability
Equity
Preferred limited partners equity
Brookfield ................................................
680
662
Brookfield Reinsurance and associates ...
$
11
11
(1)
(2)
Includes receivables of $1,328 million (2022: $45 million) associated with the Brookfield Global Transition Fund credit facility.
Includes payables of $6 million (2022: $39 million), $81 million (2022: $64 million), and $307 million (2022: nil) associated with the
Brookfield Infrastructure Fund IV, Brookfield Global Transition Fund, and Brookfield Global Transition Fund II credit facilities,
respectively.
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Current assets
Amounts due from Brookfield are non-interest bearing, unsecured and due on demand.
Current liabilities
Amounts due to Brookfield are unsecured, payable on demand and relate to recurring transactions.
29. SUPPLEMENTAL INFORMATION
The net change in working capital balances for the year ended December 31 shown in the consolidated statements of
cash flows is comprised of the following:
(MILLIONS)
2023
2022
Trade receivables and other current assets ............................................................. $
540 $
(296) $
Accounts payable and accrued liabilities ................................................................
Other assets and liabilities ......................................................................................
(60)
(12)
109
(7)
$
468 $
(194) $
2021
(515)
(282)
81
(716)
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30. SUBSIDIARY PUBLIC ISSUERS
The following tables provide consolidated summary financial information for Brookfield Renewable, BRP Equity,
and Canadian Finco:
(MILLIONS)
Brookfield
Renewable(1)
BRP
Equity
Canadian
Finco
Subsidiary
Credit
Supporters(2)
Other
Subsidiaries(1)(3)
Consolidating
adjustments(4)
Brookfield
Renewable
consolidated
As at December 31, 2023:
Current assets ............................... $
Long-term assets ..........................
Current liabilities .........................
Long-term liabilities ....................
Participating non-controlling
interests – in operating
subsidiaries ...............................
Participating non-controlling
interests – in a holding
subsidiary – Redeemable/
Exchangeable units held by
Brookfield .................................
BEPC exchangeable shares .........
Preferred equity ...........................
Perpetual subordinated notes .....
Preferred limited partners’
equity .............................................
As at December 31, 2022:
Current assets ................................. $
Long-term assets ............................
Current liabilities ...........................
Participating non-controlling
interests – in operating
subsidiaries ................................
Participating non-controlling
interests – in a holding
subsidiary –
Redeemable\Exchangeable
units held by Brookfield ............
BEPC exchangeable shares ............
Preferred equity .............................
Perpetual subordinated notes .........
65 $ 400 $ 2,695 $
790 $
4,735
72
—
246
8
—
2
32
2,650
44,239
8,406
56
4,611 $
71,435
7,658
35,405
(3,951) $
(49,139)
(8,138)
—
4,610
71,518
8,038
38,111
—
—
—
—
18,863
—
18,863
—
—
—
—
—
—
583
—
760
—
—
—
—
—
—
2,684
—
—
592
765
61 $ 391 $ 2,336 $
834 $
4,860
60
241
7
3
30
33,830
7,877
—
—
—
—
—
—
—
—
571
—
—
—
—
—
—
—
16
—
2,892
—
—
592
765
—
2,479
—
—
—
—
—
—
2,684
2,479
583
592
—
(765)
760
4,172 $
59,860
4,455
(3,611) $
(38,866)
(7,486)
30,567
—
4,183
59,928
4,943
32,882
14,755
—
14,755
—
2,561
—
—
—
—
—
—
—
(766)
2,892
2,561
571
592
760
Long-term liabilities ......................
—
—
2,299
Preferred limited partners’ equity ..
761
—
(1)
(2)
(3)
(4)
Includes investments in subsidiaries under the equity method.
Includes BRELP, BRP Bermuda Holdings I Limited, Brookfield BRP Holdings (Canada) Inc., Brookfield BRP Europe Holdings Limited,
Brookfield Renewable Investments and BEP Subco Inc., collectively the “Subsidiary Credit Supporters”.
Includes subsidiaries of Brookfield Renewable, other than BRP Equity, Canadian Finco and the Subsidiary Credit Supporters.
Includes elimination of intercompany transactions and balances necessary to present Brookfield Renewable on a consolidated basis.
Page 155
(MILLIONS)
For the year ended December 31, 2023
Brookfield
Renewable(1)
BRP
Equity
Cana
dian
Finco
Subsidiary
Credit
Supporters
Other
Subsidiaries(1)(2)
Consolidating
adjustments(3)
Brookfield
Renewable
consolidated
Revenues ............................................... $
— $ — $ — $
— $
5,038 $
— $
5,038
Net income (loss) ..................................
(50)
—
3
(724)
1,686
(299)
616
For the year ended December 31, 2022
Revenues ................................................ $
— $ — $ — $
— $
4,711 $
— $
4,711
Net income (loss) ...................................
(122)
—
2
(1,322)
772
808
138
For the year ended December 31, 2021
Revenues ................................................ $
— $ — $ — $
— $
4,096 $
— $
4,096
Net income (loss) ...................................
(136)
—
—
(1,185)
561
694
(66)
(1)
(2)
(3)
Includes investments in subsidiaries under the equity method.
Includes subsidiaries of Brookfield Renewable, other than BRP Equity, Canadian Finco, and the Subsidiary Credit Supporters.
Includes elimination of intercompany transactions and balances necessary to present Brookfield Renewable on a consolidated basis.
See Note 13 – Borrowings for additional details regarding the medium-term notes issued by Canadian Finco. See
Note 14 – Non-controlling interests for additional details regarding Class A Preference Shares issued by BRP
Equity.
31. SUBSEQUENT EVENTS
Subsequent to year-end, Brookfield Renewable issued C$400 million of Series 17 medium-term notes. The medium-
term notes have a fixed interest rate of 5.32% and a maturity date of January 10, 2054. The Series 17 medium-term
notes are corporate-level green bonds.
Subsequent to year-end, Brookfield Renewable, together with its institutional partners, completed the acquisition of
a series of development distributed generation projects in the United States totaling 93 MW for total consideration of
approximately $86 million (approximately $17 million net to Brookfield Renewable). Brookfield Renewable holds a
20% interest in these investments.
Subsequent to year-end, Brookfield Renewable, together with its institutional partners, completed the acquisition of
a series of development distributed generation projects in the United States totaling 60 MW for total consideration of
approximately $39 million (approximately $11 million net to Brookfield Renewable). Brookfield Renewable holds a
25% interest in these investments.
Subsequent to year-end, Brookfield Renewable repurchased 496,254 LP units on the Toronto Stock Exchange at a
total cost of $12 million.
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