Capital Power 2025 Investor Day: Accelerating Growth to 2030
Executive Summary
- Capital Power announced a binding memorandum of understanding (“MOU”) with Apollo Global Management‑affiliated funds to create a US $3 billion partnership aimed at acquiring merchant natural‑gas generation assets in the United States.
- The company also entered into a separate binding MOU with an investment‑grade data‑centre developer in Alberta for a 250 MW Electricity Supply Agreement (ESA) expected to commence in 2028, supporting AI‑related power demand.
- Capital Power provided its 2026 financial guidance, highlighting Adjusted EBITDA of $1.565–$1.765 billion, AFFO of $890–$1.010 billion, sustaining capital of $290–$330 million, and a 2% dividend‑growth target.
Key Details
- Apollo Funds Partnership:
- Total potential equity commitment up to US $3 billion (US $2.25 bn from Apollo Funds, US $750 m from Capital Power).
- Capital Power may take a 25%–50% working interest in each acquisition.
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The partnership will include management and performance fees for Capital Power on acquired assets.
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Alberta Data‑Centre ESA:
- Binding MOU to negotiate a long‑term (10+ years) electricity supply agreement for up to 250 MW, with an anticipated start date in 2028.
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If negotiations fail, the data‑centre developer will pay a termination fee to Capital Power.
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2030 Growth Targets (highlighted at Investor Day):
- ~3.5 GW increase in U.S. capacity (≈50% cumulative growth).
- 13%–15% annual total shareholder return (TSR).
- 8%–10% annual AFFO per‑share growth.
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Maintain a 2%–4% annual dividend‑growth target.
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2026 Financial Guidance:
- Adjusted EBITDA: $1,565 million – $1,765 million.
- AFFO: $890 million – $1,010 million.
- Sustaining Capital: $290 million – $330 million.
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Dividend growth target: 2% per year.
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Strategic Rationale (CEO Quote): Avik Dey emphasized that the Apollo partnership will “accelerate our efforts to deliver long‑term reliable growth” and that the ESA positions Capital Power to power Alberta’s expanding AI infrastructure.
Notable Quotes
“Our planned investment partnership with Apollo Funds would accelerate our efforts to deliver long‑term reliable growth to our shareholders by augmenting our industry‑leading growth platform and enhancing our access to capital.” – Avik Dey, President & CEO
Materiality Assessment: Material – Positive (the announcement of a multi‑billion‑dollar partnership and new long‑term supply agreement represents a significant strategic development with clear upside potential for the company’s growth trajectory.)