AES Announces Extension Agreement for Southland Legacy Units in California

Rhea-AI Summary

The AES Corporation (NYSE: AES) has signed agreements with the California Department of Water Resources to extend operations of its once-through cooling (OTC) units at the Huntington Beach and Alamitos facilities until 2026. This move aims to enhance grid reliability while supporting California's decarbonization efforts, pending approval from the State Water Resources Control Board. The Southland legacy units boast 2.3 GW of gas generating capacity across three facilities, with operations for all OTC units set to expire in December 2023, except for Huntington Beach and Alamitos, should extensions be granted. AES emphasizes its commitment to flexible energy solutions for local communities amid California's transition toward a zero-carbon energy future.

Positive

• Extension of operations for OTC units supports grid reliability and decarbonization goals.
• AES's facilities have a significant capacity of 2.3 GW, aiding California's energy needs.
• Commitment to flexible and innovative energy solutions aligns with state initiatives.

Negative

• Operations for Redondo Beach OTC unit will end in December 2023.
• Extension approval is contingent on regulatory decisions, introducing uncertainty.

Capacity Supports Grid Reliability as State Moves Toward Decarbonization

ARLINGTON, Va., April 26, 2023 /PRNewswire/ -- The AES Corporation (NYSE: AES) today announced that it has signed agreements with the California Department of Water Resources (DWR) to extend operations of the once-through cooling (OTC) units at its Huntington Beach and Alamitos facilities through 2026. The extension will help meet the state's grid reliability needs while supporting its decarbonization goals, and is subject to the State Water Resources Control Board extending the OTC compliance dates, anticipated in the second half of 2023.

"Our Southland legacy units continue to demonstrate that they are ready and able to support the reliability of California's electric grid," said Andrés Gluski, AES President and Chief Executive Officer. "At AES, we are committed to supporting the energy needs of local communities with flexible and innovative solutions."

The Southland legacy units include 2.3 GW of gas generating capacity in Southern California, across three facilities: Alamitos, Huntington Beach, and Redondo Beach. Operations for all OTC units are currently scheduled to expire in December 2023, at which time Redondo Beach will be retired. If the three-year extensions for the 1.4 GW at Huntington Beach and Alamitos are approved, AES will continue to operate these OTC units during emergency grid reliability events within the Strategic Reliability Reserve Program as outlined in AB205, legislation that sets out state initiatives to ensure grid reliability as it moves toward a zero-carbon energy future.

About AES

The AES Corporation (NYSE: AES) is a Fortune 500 global energy company accelerating the future of energy. Together with our many stakeholders, we're improving lives by delivering the greener, smarter energy solutions the world needs. Our diverse workforce is committed to continuous innovation and operational excellence, while partnering with our customers on their strategic energy transitions and continuing to meet their energy needs today. For more information, visit www.aes.com.

Safe Harbor Disclosure

This news release contains forward-looking statements within the meaning of the Securities Act of 1933 and of the Securities Exchange Act of 1934. Such forward-looking statements include, but are not limited to, those related to future earnings, growth and financial and operating performance. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute AES' current expectations based on reasonable assumptions. Forecasted financial information is based on certain material assumptions. These assumptions include, but are not limited to, our expectations regarding accurate projections of future interest rates, commodity price and foreign currency pricing, continued normal levels of operating performance and electricity volume at our distribution companies and operational performance at our generation businesses consistent with historical levels, as well as the execution of PPAs, conversion of our backlog and growth investments at normalized investment levels, rates of return consistent with prior experience and the COVID-19 pandemic.

Actual results could differ materially from those projected in our forward-looking statements due to risks, uncertainties and other factors. Important factors that could affect actual results are discussed in AES' filings with the Securities and Exchange Commission (the "SEC"), including, but not limited to, the risks discussed under Item 1A: "Risk Factors" and Item 7: "Management's Discussion & Analysis" in AES' 2022 Annual Report on Form 10-K and in subsequent reports filed with the SEC. Readers are encouraged to read AES' filings to learn more about the risk factors associated with AES' business. AES undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except where required by law.

Any Stockholder who desires a copy of the Company's 2022 Annual Report on Form 10-K filed March 1, 2023 with the SEC may obtain a copy (excluding the exhibits thereto) without charge by addressing a request to the Office of the Corporate Secretary, The AES Corporation, 4300 Wilson Boulevard, Arlington, Virginia 22203. Exhibits also may be requested, but a charge equal to the reproduction cost thereof will be made. A copy of the Annual Report on Form 10-K may be obtained by visiting the Company's website at www.aes.com.

Website Disclosure

AES uses its website, including its quarterly updates, as channels of distribution of Company information. The information AES posts through these channels may be deemed material. Accordingly, investors should monitor our website, in addition to following AES' press releases, quarterly SEC filings and public conference calls and webcasts. In addition, you may automatically receive e-mail alerts and other information about AES when you enroll your e-mail address by visiting the "Subscribe to Alerts" page of AES' Investors website. The contents of AES' website, including its quarterly updates, are not, however, incorporated by reference into this release.

Investor Contact: Susan Harcourt 703-682-1204
Media Contact: Stephanie Cathcart 571-294-6824, stephanie.cathcart@aes.com

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SOURCE AES CORP.

FAQ

What are the recent agreements AES signed regarding its facilities in California?

AES signed agreements with the California Department of Water Resources to extend the operations of its OTC units at the Huntington Beach and Alamitos facilities through 2026.

How does AES's extension of operations impact California's energy grid?

The extension is intended to enhance grid reliability while supporting California's decarbonization goals.

What is the capacity of AES's Southland legacy units?

The Southland legacy units include 2.3 GW of gas generating capacity across three facilities: Alamitos, Huntington Beach, and Redondo Beach.

What is the deadline for AES's OTC units operations?

All OTC units are currently scheduled to expire in December 2023.

What legislative measures support AES's operations in California?

AES's operations are outlined in AB205, which includes initiatives for ensuring grid reliability as the state moves towards a zero-carbon energy future.