CORPORATE OVERVIEW October 8, 2019 Information contained in this - - PowerPoint PPT Presentation

October 8, 2019

CORPORATE OVERVIEW

Information contained in this document is strictly confidential

CAUTIONARY STATEMENTS

This presentation (“Presentation”), and the information contained herein, is not for release, distribution or publication into or in the United States or any jurisdiction where applicable laws prohibit its release, distribution or publication. This Presentation is being issued by Greengate Power Corporation (“Greengate”) for information purposes only. Reliance on this Presentation for the purpose of engaging in any investment activity may expose an individual to significant risk of losing all of the property or other assets invested. This Presentation does not constitute or form part of, and should not be construed as, an offer or invitation to sell or any solicitation of any offer to purchase or subscribe for any securities in any jurisdiction. The contents of this Presentation have not been approved or disapproved by any securities commission or regulatory authority in Canada, the United States or any other jurisdiction and should not be relied on or act as an inducement to enter into any agreement in relation to any securities of

• Greengate. All purchasers of securities will be required to execute a subscription agreement and this Presentation is qualified in its entirety by such subscription

agreement. The information in this Presentation is provided as of October 8, 2019, has not been independently verified and may not contain certain material information about Greengate, including important disclosures and risk factors. This Presentation includes market and industry data from third party sources, Greengate hereby disclaims any responsibility or liability whatsoever in respect of any third party sources of market and industry data or information and there is no assurance or guarantee as to the accuracy or completeness of such information. This Presentation does not take into account the particular investment objectives or financial circumstances of any specific person who may receive it. Prospective investors should consider the advice of their financial, legal, accounting, tax and other advisors, and such other factors they consider appropriate, in investigating and analyzing Greengate. Neither Greengate, nor its directors, officers, shareholders, agents, employees or advisors give, has given or has authority to give, any representations or warranties (express or implied) in relation to the accuracy, currency, reliability or completeness of the information or opinions in this Presentation and liability therefore is expressly disclaimed for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith. Except as may be required by applicable law, in furnishing this Presentation, Greengate does not undertake or agree to: any obligation to provide the recipient with access to any additional information; update this Presentation; or correct any inaccuracies or omissions. By acceptance of this Presentation, the recipient agrees to not distribute it to others, in whole or in part, and agrees to keep all information herein confidential.

1

FORWARD-LOOKING INFORMATION

This Presentation contains certain forward-looking statements or forward-looking information under applicable securities legislation (“forward-looking information”). This information relates to future events or future performance of Greengate. Forward-looking information are statements that are not historical facts and are often, but not always, identified using words or phrases such as “anticipate”, “believe”, “continue”, “estimate”, “expect”, “future”, “may”, “opportunity”, “plan”, “potential”, “potential”, “project”, “propose”, “scheduled”, “signal”, “target”, “will” and other similar expressions. In particular, but without limiting the foregoing, this Presentation contains forward-looking information pertaining to, among other things: the terms of the transactions described in this Presentation including, without limitation, Greengate’s proposed offering of common shares; Greengate’s projects including, without limitation, the earned interests therein and development thereof; supply and demand of electricity; Alberta coal phase-out; wind and solar resources; business plans and strategies; merchant solar; corporate PPAs; estimated valuations and cash flows. Such forward looking statements or information are used in this Presentation for the purpose of providing information about Greengate management’s current expectations and plans relating to the future development of Greengate’s business. Readers are cautioned that reliance on such information may not be appropriate for other purposes, such as making investment decisions. Although Greengate believes that the expectations reflected in such forward-looking information are reasonable, such statements are not guarantees of future performance and actual results may differ materially from those in statements of forward-looking information. Undue reliance should not be placed on forward-looking information because Greengate can give no assurance that such expectations will prove to be correct and such statements are based on the beliefs, estimates and

• pinions of Greengate’s management on the date such statements are made. Many factors could cause Greengate’s actual results, performance or achievements to

vary from those described herein. Should one or more of these risks or uncertainties materialize, or should assumptions underlying forward-looking information prove incorrect, actual results may differ materially from those described in this Presentation. Such risks and uncertainties include, without limitation: the impact of general economic and business conditions in Canada, the United States and overseas; industry conditions; changes in laws and regulations (including the adoption of new environmental laws and regulations); and changes in how laws and regulations are interpreted and enforced. The forward-looking information included in this Presentation is expressly qualified in its entirety by this cautionary statement. Greengate cautions that the foregoing lists of assumptions, risks and uncertainties is not exhaustive. The forward-looking information contained in this Presentation is made as of the date hereof and Greengate undertakes no obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. All subsequent forward-looking information, whether written or oral, attributable to Greengate or persons acting on its behalf is expressly qualified in their entirety by these cautionary statements.

2

POWER MARKET!!!!!!

EVOLUTION OF POWER

3

185 GW

2018

280 GW

2022

11%

CAGR

COMPELLING OPPORTUNITY FOR RENEWABLE ENERGY DEVELOPERS

Source: International Energy Agency

RENEWABLE ENERGY CONTINUES GROWTH

Wind and solar installed capacity in U.S. & Canada

private & confidential 4

~6300 MW

2019

~900 MW

2034

PROJECTED REMAINING OPERATING COAL TO GAS CONVERSIONS

EQUIVALENT TO ~14,000 MW OF SOLAR

1

1 Capacity factors, coal: 65%;

solar: 22%

SIGNIFICANT OPPORTUNITY FOR RENEWABLE GROWTH IN ALBERTA

Expected supply shrinkage due to coal retirements

ALBERTA COAL PHASE-OUT

private & confidential 5

UCP wins significant majority in April 2019 provincial election

ALBERTA RETURNS TO CONSERVATIVE ROOTS

private & confidential 6

UCP SUPPORTIVE OF MARKET-BASED RENEWABLES

UCP understands the value of renewables, they have affirmed support for market-based renewables and the potential for low- cost power & jobs without subsidies

QUICK DECISION ON ENERGY-ONLY MARKET

UCP completed its review of the proposed move to a capacity market and decided to maintain the existing energy-only market which bodes well for renewable generators and consumers

MAINTAINING COAL PHASE-OUT & INDUSTRIAL CARBON TAX

UCP is committed to phase out all coal-fired electricity by 2030. UCP eliminated the retail carbon tax but is maintaining an industrial carbon regulation through its TIER program allowing renewables to generate compliance credits

1 3 2

RENEWABLES HAVE IMPORTANT ROLE IN FUTURE

Renewables cost-effective on a subsidy-free basis and have an important role in the energy mix as Alberta phases out its coal- fired electricity and replaces it with cleaner technologies

4

~$39/ MWh 3

WIND – 2017 & 2018

Recent procurements by Alberta Electric System Operator (AESO) uncover low cost of renewables

AGE OF RENEWABLES HAS ARRIVED

private & confidential 7

SOLAR – 2018

~$48/ MWh 2

2018 & 10 YEAR AVERAGE WHOLESALE PRICE

~$51/ MWh 1

PROVEN TRACK RECORD & RENEWABLE DEVELOPMENT EXPERTISE

8

GREENGATE SNAPSHOT

WINNING TRACK RECORD CONTINUES

• Successfully developed 450 MW of operating wind energy in Alberta since inception
• Represents one-third of all operating wind energy in Alberta and an investment of

approximately $1 billion

• Awarded 20-year PPA with AESO for 113 MW Stirling Wind Project (anticipated completion in

2020)

private & confidential

400 MW TRAVERS SOLAR PROJECT – CONSTRUCTION READY Q1 2020

• Expected to be Canada’s largest operating solar energy project and one of the largest in the

world upon completion in 2021

• Nearly 5,000 contiguous acres of land secured with strong landowner support, top tier solar

resource, highly buildable with simple topography and few constraints

• AUC Power Plant and Substation Approvals received August 2019
• Interconnection is adjacent to site and capacity confirmed by AESO
• Will generate significant annual cash flow to Greengate for 35+ years

ENGAGED CIBC – CANADA’S TOP POWER INVESTMENT BANKING TEAM

• Working with CIBC to raise ~$500mm in equity and debt capital for Travers Solar
• Strong interest expressed by diverse group of domestic and international funds & utilities
• Greengate to retain on-going economic interest through non-dilutive project-level financing

9

DEVELOPED ONE-THIRD OF ALL OPERATING WIND ENERGY IN ALBERTA

Halkirk Wind (2012)

150 MW

Blackspring Ridge Wind (2014)

300 MW

investment: $357mm turbines: 83 acquirer: Capital Power

sold at the start of construction and largest operating wind energy project in Alberta at time of commissioning

investment: $600mm turbines: 166 acquirer: EDF & Enbridge

sold at start of construction and largest operating wind energy project in Canada at time of commissioning

Ontario Wind (2009)

30 MW

investment: $60mm turbines: 15

developed three wind projects which were awarded FIT contracts and remain operating

A PROLIFIC RENEWABLE DEVELOPER

private & confidential 10

DAN BALABAN

TRACK RECORD OF INNOVATION & SUCCESS

Co-Founder, President & CEO 12 years with Greengate Formerly CEO of Roughneck.ca, management consultant with E&Y and PwC 2012 E&Y Entrepreneur of the Year 2010 and 2013 Alberta Venture – 50 Most Influential People

JORDAN BALABAN Co-Founder, CFO

12 years with Greengate and successfully developed and financed ~$1 billion of renewables

DAN TOCHER VP, Stakeholder Relations

Led stakeholder relations for renewable energy projects for over 10 years Executed largest land lease program for renewables in Alberta

FOLLOW THE TRANSMISSION INNOVATIVE LANDOWNER COMPENSATION MODEL BUILDING AT UNPRECEDENTED SCALE

BRENDEN MARCHEWKA

Director, Project Development Senior development, construction and operating expertise across conventional and renewable generation 11 private & confidential

GREENGATE PROJECT MAP

private & confidential

CURRENT SOLAR PROJECT CURRENT WIND PROJECT TRAVERS SOLAR – 400 MW PAST WIND PROJECT BLACKSPRING RIDGE WIND – 300 MW STIRLING WIND – 113 MW LATHOM SOLAR – 120 MW BASSANO SOLAR – 9.5 MW HALKIRK WIND – 150 MW WHEATLAND WIND – 120 MW PAINTEARTH WIND – 150 MW PROVOST SOLAR – 12 MW KILLARNEY LAKE SOLAR – 16 MW WAINWRIGHT SOLAR – 15.5 MW 12

POWERED BY THE WIND

13

Wheatland Wind

120 MW

Paintearth Wind

150 MW

Stirling Wind (Awarded PPA)

113 MW

383 MW WIND IN LATE-STAGE DEVELOPMENT

private & confidential

WIND RESOURCE

Consistent / robust / +40% NCF

TOPOGRAPHY

Easy to access / build

TRANSMISSION

Nearby / availability / no upgrades

+ MANAGEMENT FEE + ROYALTY + SUCCESS PAYMENT

75% 25%

14

+ EQUITY INTEREST

Through wholly-

• wned subsidiary

REP 2 – December 2018

363 MW, $39/MWh

REP 3 – December 2018

401 MW, $40/MWh

REP EP 1 – Decem embe ber r 2017

595 MW, $38/MWh

STIRLING WIND AWARDED 20-YEAR ALBERTA GOV’T PPA

private & confidential

TARGET COD: Q4 2020 STEPS TO NTP:

AUC Permit Amendment Approval Development Permit Approval

GREENGATE PROJECT ECONOMICS:

Equity interest, success payment, and ongoing royalty providing cash flow to Greengate for 30+ years 18.75% 56.25% 113 MW STIRLING WIND PROJECT

PAUL FIRST NATION

25%

15

Stirling Wind awarded one of the three contracts granted in REP 2

POWERED BY THE SUN

16

Lathom

120 MW

Travers

400 MW

INDUSTRY-LEADING ~580 MW ALBERTA SOLAR PORTFOLIO

private & confidential

SOLAR RESOURCE AND CONFIRMED TRANSMISSION

+20% NCF

TOPOGRAPHY

Easy to access / build

WHOLLY OWNED PROJECTS

Allows for creative financing structures

ALBERTA SOLAR RESOURCE FLORIDA SOLAR RESOURCE 1

DG Portfolio

58 MW

COMPARABLE TO

17

private & confidential

SOLAR RECEIVES NATURAL PRICE PREMIUM

SOLAR PRODUCES ON PEAK, CAPTURING A PRICE PREMIUM IN ALBERTA’S DEREGULATED POWER MARKET

1

BATTERIES MIGHT BE USED IN FUTURE WHEN ARBITRAGE OPPORTUNITY JUSTIFIES

2

18

Travers is anticipated to realize an ~15% premium to the average pool price over the life of the project 4

private & confidential

SOLAR IS COMPLEMENTARY TO GAS & WIND

SOLAR PRODUCTION INVERSELY CORRELATED TO WIND PRODUCTION REDUCING OVER- SUPPLY RISK

1

SOLAR PRODUCTIVE WHEN GAS FLEET DE-RATES IN HOT TEMPERATURE

2

19

Pool price premium is realized when other generation technologies are unproductive

private & confidential

KEY ECONOMIC DRIVERS OF SOLAR

SOLAR IS PRODUCTIVE DURING THE DAYTIME WHEN POOL PRICE IS HIGHER RESULTING IN A PRICE PREMIUM TO THE AVERAGE ANNUAL POOL PRICE

1

SOLAR PV IS NOW COST EFFECTIVE ON A SUBSIDY-FREE BASIS DRIVEN BY CONTINUAL COST AND EFFICIENCY IMPROVEMENTS

2

STRONG PRICE SIGNAL FOR SOLAR

19

SIMPLE OPERATIONS RESULT IN HIGH OPERATING MARGINS

3

SOLAR HAS A LONG OPERATING LIFE OF 35+ YEARS, WHICH RESULTS IN HIGH LONG-TERM PROJECT VALUE

4

Solar PV is an unparalleled asset class for generating long-term cash flow

ENGAGED CIBC – CANADA’S TOP POWER INVESTMENT BANKING TEAM

• Working with CIBC to raise ~$500mm in non-dilutive project-level

equity and debt capital for Travers Solar

• Strong

interest expressed by diverse group

• f

domestic and international funds & utilities

CONFIRMED TRANSMISSION CAPACITY

• Transmission interconnection adjacent to site and full project capacity

confirmed by AESO

• Currently in Stage 4 of AESO interconnection process

LOW-COST BUILD AND TOP-TIER SOLAR RESOURCE

• Among the most buildable large-scale solar sites in North America with

few constraints and simple topography

• Nearly 5,000 acres of contiguous land secured with top-tier solar

resource and strong landowner support

• Anticipated completion in 2021 with potential to generate significant
• ngoing cash flow for Greengate for 35+ years through ongoing

economic interest

1 2 4

private & confidential

CALGARY

CROWN JEWEL – 400 MW TRAVERS SOLAR

PROPOSED PROJECT BOUNDARY TRANSMISSION LINE CONSTRAINTS

20

RECEIVED AUC PERMIT

• AUC Power Plant and Substation applications were approved in August

2019

3

Largest solar development in Canada – among the largest globally

MARKET DYNAMICS PERFECTLY SUITED FOR MERCHANT SOLAR EXPECTED DOWNSIDE RETURNS COMPARABLE WITH FULLY CONTRACTED PROJECT RETURNS REVENUE FROM ENERGY AND ENVIRONMENTAL ATTRIBUTES

1 3 2

private & confidential CASE UNLEVERED PRE-TAX RETURN1 PAYBACK

Expected (P50) ~13% 3% ~9 years Downside (P90) ~8% ~8% ~14 years

TRAVERS SOLAR RESILIENT MERCHANT CASH FLOWS

CALGARY

21

interest

Strong case for merchant solar

Energy revenue derived from sales into the Alberta power pool and environmental attributes sold to large final emitters or corporates with sustainability targets

private & confidential

CORPORATE PPAs – AN OPPORTUNITY IN CANADA

ALBERTA IS THE ONLY CANADIAN MARKET SUITED TO CORPORATE PPAs

2

GREENGATE IN POLE POSITION

3

• Deregulation critical to buyer choice
• Alberta has highest grid emissions intensity in

Canada

• Founding Member of Business Renewables Center

Canada

• In active discussions with various brokers and

corporate buyers

22

COMPLIANCE FOR LARGE FINAL EMITTERS AND CORPORATES WITH SUSTAINABILITY TARGETS

1

• Large final emitters can comply under the TIER

regulation with environmental attributes generated by renewables

• Corporates procure voluntary REC’s in order to meet

sustainability targets

PARTNERS FINANCING

CORPORATE FINANCING

23

CORPORATE FINANCING – PLANNED USE OF FUNDS

private & confidential

STIRLING FUNDING UNTIL SHOVEL-READY

Complete development to enable financing and start of construction for Stirling Wind

PORTFOLIO DEVELOPMENT

Continue advancing remainder of development portfolio

FINAL PERMITTING, COSTING & ENGINEERING

Finalize all permitting, detailed costing, supply negotiations and engineering for Stirling Wind and Travers Solar

CORPORATE EQUITY FINANCING OF $2mm ($0.75 / SHARE)

24

TRAVERS FUNDING UNTIL FINANCIAL CLOSE

Complete the CIBC process to raise ~$500mm of non-dilutive project-level equity and debt capital for Travers Solar

STRENGTHEN THE BALANCE SHEET

Improve Greengate’s position to maximize value from negotiations with potential project partners for Travers Solar

POTENTIAL CASH FLOW & VALUATION

private & confidential

POTENTIAL VALUATION IN 20221

LOW CASE – ROYALTY INTEREST IN 400 MW TRAVERS (FINANCED MERCHANT) HIGH CASE – ROYALTY INTEREST IN 400 MW TRAVERS (FINANCED MERCHANT)

~$4.50 / share ~$3.00 / share

25

POTENTIAL VALUATION INCREASE3

4X – 6X / share

$0.50 $0.30 $0.10 2022 30-YEAR AVERAGE

Management objective to increase annual distributions as future projects are developed or with excess cash flow above initial target dividend of $0.10 / share starting in 2022

CASH FLOW PER SHARE2

LOW CASE LOW CASE HIGH CASE HIGH CASE

EXCESS CASHFLOW FOR FUTURE PROJECTS OR INCREASED DIVIDEND TARGET INITIAL DIVIDEND IN 2022

Key milestones for Greengate to reach dividend yield beginning 2022

REALIZING DIVIDEND STARTING 2022

private & confidential 26

CONSTRUCTION OF STIRLING WIND FINALIZE DETAILED ENGINEERING, REMAINING PERMITTING AND EXECUTE MATERIAL CONTRACTS FOR TRAVERS SOLAR COMPLETE FINANCING PROCESS WITH CIBC FOR TRAVERS SOLAR CONSTRUCTION OF TRAVERS SOLAR

Q4 Q1 Q2 Q3 Q4 2020 2019 Q1 Q2 Q3 Q4 2021

FIRST SHAREHOLDER DIVIDEND

2022 Q1

FINANCING TERMS

private & confidential

SHARES OUTSTANDING

PRE-MONEY

OPTIONS

POST-MONEY

TOTAL

18,646,701 1,825,000 23,581,701 21,313,368 1,825,000 26,248,368

WARRANTS

3,110,000 3,110,000

BASIC 27

OFFERING

2.67mm COMMON SHARES MINIMUM INVESTMENT

$60,000 $0.75 / share

TARGET PROCEEDS

$2.0mm

PRE-MONEY VALUATION

$14.0mm

GREENGATE CLOSED FINANCING FOR ~$3.4mm INCLUDING ~$1mm BY THE BALABAN FAMILY ON THE SAME TERMS AS THIS CURRENT OFFERING IN Q2/Q3 2019.

CONTACT US

private & confidential

DAN BALABAN

PRESIDENT & CEO

EMAIL: PHONE: 403.930.1301

dan@greengatepower.com

28

JORDAN BALABAN

CFO

EMAIL: PHONE: 403.630.4581

jordan@greengatepower.com

FOR MORE INFORMATION PLEASE

INVESTOR RIGHTS OF ACTION

Inves estor

• r Rights

Securities legislation in certain Canadian provinces and territories provide a purchaser with remedies for rescission or damages if an offering memorandum (including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars of these rights and consult with a legal advisor. A “misrepresentation” is an untrue statement of a material fact or an

• mission to state a material fact that is required to be stated or that is necessary to make any statement not misleading in light of the circumstances in which it was
• made. Such rights: would only apply to a purchaser of Greengate securities in those Canadian jurisdictions where this Presentation is deemed to be an offering

memorandum pursuant to applicable securities law; are in addition to and without derogation from any other right or remedy available at law; and are subject to certain

• defences. The summaries below are subject to the express provisions of applicable securities law and are qualified in their entirety thereby.

Ontario Investors – Ontario securities legislation provides that where an offering memorandum is delivered to a purchaser and contains a misrepresentation, the purchaser will be deemed to have relied upon the misrepresentation and will, except as provided below, have a statutory right of action for damages or for rescission against the issuer and a selling security holder on whose behalf the distribution is made; if the purchaser elects to exercise the right of rescission, the purchaser will have no right of action for damages against the issuer or any selling security holder. No such action shall be commenced more than, in the case of an action for rescission, 180 days after the date of the transaction that gave rise to the cause of action, or, in the case of any action other than an action for rescission, the earlier of: (i) 180 days after the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three years after the date of the transaction that gave rise to the cause of action. The Ontario legislation provides a number of limitations and defences to such actions, including: (a) the issuer or any selling security holder is not liable if it proves that the purchaser purchased the securities with knowledge of the misrepresentation; (b) in an action for damages, the issuer shall not be liable for all or any portion of the damages that the issuer or any selling security holder proves do not represent the depreciation in value of the securities as a result of the misrepresentation relied upon; and (c) in no case shall the amount recoverable exceed the price at which the securities were offered. Alberta and British Columbia Investors – The securities legislation of the provinces of Alberta and British Columbia do not provide or require Greengate to provide to purchasers resident in these provinces any rights of action in circumstances where this Presentation contains a misrepresentation. Purchasers in other Canadian provinces or territories – Readers should refer to the applicable provisions of the securities legislation of their province or territory for the particulars of these rights and consult with a legal advisor.

29