Altalink L.P.

Overview Key strengths Key risks A relatively low-risk electricity transmission company. Geographic and regulatory diversity limited to Alberta, Canada. It is not exposed to volumetric, counterparty, or commodity price risk, limiting cash flow volatility. Rising physical risk in the service territory. A mostly supportive regulatory framework in Alberta and effective regulatory risk management. Negative discretionary cash flow (DCF) during the forecast period indicates external funding needs. While this is lower than the 9.28% ROE for 2024, it remains above the 8.5% ROE approved for 2023. The 2025 ROE was premised on the formula approved by the commission in 2023. The formula is based on a 9% ROE, adjusted for changes to the 30-year Government of Canada bond yield and the

...In November 2024, the Alberta Utilities Commission (AUC) set the return on equity (ROE) for 2025 at 8.97%. While this is lower than the 9.28% ROE for 2024, it remains above the 8.5% ROE approved for 2023. The 2025 ROE was premised on the formula approved by the commission in 2023. The formula is based on a 9% ROE, adjusted for changes to the 30-year Government of Canada bond yield and the 'A'-rated Canadian utility bond yield. We believe the formula-based rate calculation provides a standardized approach for determining the ROE; however, future ROE could stabilize below 9% if the Government of Canada bond yields return to more historical levels, resulting in lower cash flows....

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