AES Gener March 2016

AES Gener Key investment considerations Highlights

1

2

Asset map

Leading position: Largest energy producer in Chile, and major producer in Colombia, with one of the most efficient plants in Argentina

3 countries

Diversification: One of the most diversified LatAm generator player in terms of geographical footprint and technology

5 technologies

22 operating plants Bogota

4 plants under construction

1 international transmission line Antofagasta

3

Reliable Growth: Secured future growth through fully-financed pipeline and worldclass contractors

4

Stable cash flows: Largely contracted US dollar-denominated revenue streams with built in fuel and inflation protection

5

Strong capital structure: A successful financing history committed to investment grade rating

Santiago

Coal

Hydro

Natural Gas

Diesel

Biomass

1

Introduction Key statistics Data as of December 31, 2015, unless otherwise noted

5,243 MW

of installed capacity(1)

US$3.8bn

market capitalization(2)

1,083 MW

of fully funded capacity under construction(3)

US$1.3bn

remaining capex of the U$4bln 2nd expansion phase fully funded1)

(1) (2) (3)

100%

of baseload energy in Chile sold under long-term PPAs

US$691mm

2015 EBITDA

12.2

years of average remaining PPA life

BBB-/Baa3

credit ratings (S&P, Fitch, Moody’s)

Includes Guacolda. As of February 24, 2016. 152 MW Gucaolda V and 21 MW Andes Solar recently completed

2

Leading position

1

#1 generation player in Chile 27%

26% 18%

Endesa

Colbun

14%

15%

E-CL

Others

Major player in Colombia 21%

21%

19% 14% 10% 6%

EPM

Note:

Emgesa

Isagen

Gecelca

4%

4%

Celsia

EPSA

Others

In GWh, data as of December 31, 2015.

3

Attractive markets with stable regulatory frameworks

1 Chile

Ratings

System Data

Expected Energy Sales Growth (CAGR 2015-2025)

Installed capacity 4,175 MW

88%

97%

Regulated Unregulated

Aa3

Fitch

A+

Installed capacity 15,925 MW Generation 52,899 GWh

Source: Note:

5%

4.1%

45% 70%

Unregulated

CNE, data as of December 2015. Excludes TermoAndes which today exclusively sells to Argentina.

Renewable Thermal

30%

Regulated

SIC

3%

4.8%

AA-

Moody’s

Generation by Fuel Type

12%

Generation 18,800 GWh

SING S&P

Energy Sales (GWh)

50%

Hydro Thermal Other

4

Attractive markets with stable regulatory frameworks (cont’d)

1

Colombia and Argentina

Ratings S&P

Moody’s

BBB

Baa2

System Data Installed capacity 16,221 MW

Expected Energy Sales Growth (CAGR 2015-2025)

BBB

S&P

B-

3.2%

Moody’s

Fitch

Caa1

31%

33% 67%

Generation 66,173 GWh

Regulated Unregulated

Installed capacity 33,353 MW

Generation by Fuel Type

1%

Colombia Fitch

Energy Sales (GWh)

30%

3.5%

CCC

Hydro Thermal Other

6%

13%

Generation 118,507 GWh

68%

47% 40%

Large Customers Residential Commercial

64% Hydro Thermal Other

Argentina

Source:

XM, data as of December 2015 for Colombia and Private Consultants for Argentina.

5

Diversified generation platform

2

EBITDA 2015 - By electric system

Revenues 2015 - By customers

SADI 3%

SIN 36%

US$ 691mm

Spot 6% Regulated 34%

SIC 39%

US$1.4bn Total Chile 61%

Unregulated 60%

SING 22%

Installed capacity - By fuel type US$0.5bn

Biomass Solar Diesel 0.2% 0.4% 8%

Contracted 43%

Spot 57%

Natural gas 20%

5,243 MW

Coal 47% Spot 22%

Hydro 24%

Note:

As of December 31, 2015. SIC: Sistema Interconectado Central. SING: Sistema Interconectado del Norte Grande.

US$0.1bn Contracted 78%

6

2

Reliable growth History of world-class development

2nd Phase Fully Funded (GW)

7

6

5

4

3 2007

2008

2009

2010

2011

2007 – 2013 Phase I Expansion





US$3bn capital expenditure




Projects successfully completed

1,664 MW of generation plus 32 MW of BESS

2012

2013

2014

2015

2016

2017

2018

2012 – 2018 Phase II Expansion(1)






US$4bn capital expenditure 1,256 MW Construction on time and budget  Guacolda V completed  Andes Solar in commissioning tests




New business line: Desalinization  Angamos completed  Ventanas under development

7

3

Phase I: Successful and disciplined strategy

Since 2007, we have constructed 1,664 MW of new capacity in Chile… Installed Capacity (MW)

Expansionary Projects Executed (~US$3bn)

1

Angamos I & II

2

BESS Norgener

2

BESS Angamos I

1 2 5,057

Antofagasta





545 MW (2 units)

4

Coal




12 MW




20 MW




Battery




Battery

3,393 3

Los Vientos

7 6 3

4

Guacolda III

4

Guacolda IV

Santiago

5 2007

2015

...accounting for ~21% of the Chilean growth

21%

132 MW




152 MW




152 MW




Diesel




Coal




Coal

5

10%

AES Gener




Colbun

10%

EC-L

Santa Lidia

6 Nuevas Ventanas

7

Ventanas IV

7%


139 MW




272 MW




272 MW




Diesel




Coal




Coal

Endesa

8

3

High growth Phase II: Secured fully-funded pipeline US$4bn of fully funded projects under construction(1)

Development checklist

Fully funded plan Environmental approvals and social awareness Platform expansion with competitive advantage Experienced team Strong partners Secure profitability Investment grade rating

      

531

573 Angamos Desal

152 5,797 5,072

2015

5,224

2016

Guacolda V (152 MW) Completed

Solar-Andes (21 MW) In commissioning tests

Angamos Desalinization Completed

Tunjita (20 MW) Progress: 98%

2018/2019 Alto Maipo (531 MW) Progress: 24%

Cochrane (532 MW) Progress: 94%

9

Stable cash flows

4

Long term, proven and strong commercial strategy

AES Gener strategy

Predictable cash flows EBITDA (US$mm)

Efficient Generation

Long Term Contracts (up to 20 years)

Back-up Generation

Spot Sales

Firm Capacity

Capacity Charge Revenue

~75% of Expected Generation

660

624

671

691

2012

2013

2014

2015

Medium Term Contracts (1-4 years)

EBITDA Margin (%) Remaining Generation

Spot and Frequency Regulation Sales

Firm Energy (~3,000 GWh)

Reliability Charge Revenue

Contract Energy

Energía Plus Contracts (306MW)(1)

Sales to Spot

Resolution 482

28%

28%

29%

2012

2013

2014

32%

2015


Exports to Argentina through 100% owned exclusive transmission line

Note: (1)

Data as of December 31, 2015. Currently contracted 220MW.

10

Contract Strategy Chile

4

Long term, dollarized, indexed contracts




Long term contracted position with an average life of 12 years with a high quality and diversified customer base




No significant maturities until 2024




Efficient portfolio fully aligned with our contracted capacity

AES Gener Contract level

AES Gener Contracts by Sector

25,000

Industrial 8% Distribution 33%

GWh-year

20,000

Contract avg. life: 12 years

15,000

10,000

Mining 59%

5,000

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

11

Strong financial performance and value creation

4

Adjusted EBITDA & EBITDA margin Title

Total debt and net debt / EBITDA (US$ mm)

(US$ mm)

32% 28%

$2,785

$2,734

2.8x

29% $691

$671

$624

$245

3.7x

$3,375

29%

28%

$660

34%

4.5x

3.3x

$246

$263

$209

$2,282

19%

$355

$355

$377

$426

2012

2013

2014

2015

$1,706

24%

$1,487

$1,214

$1,156

14%

$1,298

$1,126

$1,669

$1,520

9% Chile

Argentina

Colombia

Total capex

2012 2013 PF / Non Recourse Debt

$1,002 $830

(US$ mm) 100%

100% 94%

$98 $585

$58

$443

$532

$366

$33

$860

$449

$49

$230

$235

$225

$242

2014

2015

$317 $167

(1)

$477

$210

$286 2013 Construction

$130

$66

$703

$55

2012

2015 Net Debt/EBITDA

Capital allocation

(US$ mm)

$419

2014 Corporate Debt

2014.00 Maintenance

Environmental

2015

2012

(1)

Capex Debt Paydown

2013

Dividends Dividend Payout Ratio

Capex net of project financing.

12

4

Strong capital structure Prudent debt profile

xxx US$ Million Total Outstanding as of December 31, 2015 US$3,507 Million 1,768

Average Cost

5.3%

Average Life

14.5 years

Net Debt/EBITDA

4.5x (2.4x excluding non recourse debt)

51%

49%

Non Recourse Debt

Recourse Debt 559

176 136

162

154

139

172

173

2023

2024

69

2016

2017

2018

2019

97.9% denominated in US$

2020

2021

2022

2025+ 25-73

88.5% at fixed interest rate

13

Key Takeaways Growth under AES Corp control


COMPANY 2015 EBITDA HIGHER THAN IN 2014



$20 million higher than last year Better results in Chile partially offset by lower energy margin in Colombia and Argentina


LEADER IN GENERATION IN CHILE



Company contributed with 27% of country generation Operational excellence proven by high availability


DIVERSIFIED AND LONG TERM CONTRACTED ASSET PORTFOLIO



Geographical, technological, customers base and fuel sources Dollarized Long Term PPAs aligned with efficient generation


MOVING FORWARD WITH SECOND EXPANSION PHASE





Guacolda V and desalinization plant successfully completed in 2015 Generator with more projects under construction in Chile Expansion plan fully funded World class partners: GIP, Mitsubishi, Antofagasta Minerals


STRONG AND ENHANCED CAPITAL STRUCTURE




Investment grade rating Strong liquidity Extended debt maturity profile

14

Annex I: Next Bid with distribution companies

Contracts with Distribution Companies Disco Bid 2015-2 Award

Distros prices & Volume 20000.0

140

18000.0 120 100

14000.0 12000.0

80

10000.0 60

8000.0

Volume (GWh)

Price (US$/MWh)

16000.0

6000.0

40

4000.0 20 2000.0

Price (US$/MWh)

Source: Systep

E-CL SING

PUNTILLA

PANGUIPULLI

PUYEHUE

DIEGO DE ALMAGRO

MONTE REDONDO

CAMPANARIO

GUACOLDA

AES GENER

COLBUN

ENDESA

0

Energy (GWh-year) 16

Distribution Company Bids Disco Bid 2015-2 Award

Proponent

Price per Existing Energy from Parent Energy Energy Energy Projects Company (GW/year) block (GWh/year) (GWh/year)

In Operation

Projects

Andes Mainstream

768

79.32

87

681

Abengoa

Abengoa

39

97.00

-

39

Thermosolar CSP + PV (110 CSP + 100 PV)

Ibereólica Cabo Los Leones

Ibereolica

195

89.31

-

195

Cabo Los Leones Wind Park I (170 MW)

Aela Generación S.A.

SCB II SpA

First Solar

88

67.64

88

-

Amuche Solar

Solar Pack

110

64.85

-

110

1,200

79.34

175

1,025

Cuel Eolic Park (33 Sarco (238 MW) and Alena MW) (108 MW) eolic parks

Luz del Norte Unit 1 Luz del Norte Units 3 & 4 (36 MW) and Unit 2 (67 MW) (38 MW) Los Libertadores Solar Park (16 MW) La Constitución Solar Park (48 MW)

17

Upcoming Bid Schedule

2015-01

Tender Call

May 29, 2015

Question & Answers

December 30, 2015

Date of proposals

April 20, 2016

Award

May 10, 2016

Supply

January 1, 2021 to December 31, 2041

Awarding Mechanism • Levelized price of energy • Fuel indexes: Annual Energy Outlook 2015 from EIA • Indexed price present value @10% Disco Bid Energy [GWh] 2015-01 (2021+20 years) BS1+BS2 2015-01 (2022+20 years) BS3 Total

Change of law •

Future: 2% variation of capital or operation cost of contract execution

2021

2022

2023

2024

2025

2026

2027

2028 +

6,600

6,600

6,600

6,600

6,600

6,600

6,600

6,600

-

7,150

7,150

7,150

7,150

7,150

7,150

7,150

6,600

13,750

13,750

13,750

13,750

13,750

13,750

13,750

Next Disco Bids • The following Disco Bids are expected according to CNE projections: • 3,000 since 2023+20 years (Tender call 2016) • 8,000 since 2024+20 years (Tender call 2017)

18

Annex II: Angamos & Guacolda

Angamos Summary of Historical Financials Revenues

EBITDA and EBITDA Margin

(US$ millions)

(US$ millions)

$332

150

$308

$298

$81

$133

$83

100% $ 127

$284 $44

$225

$198

60%

$214

40%

50

$238

41.5%

38.4%

38.8%

39.9%

2012

2013

2014

2013 Spot

2014

12%

EBITDA

Other

12

7.0x 7% 6.5x

2%

1%

$112

10

8%

4.1x

6.4x

8% 7.1x

8 6 4 $26

3.0x

3.1x

3.0x

2.5x

0%

2 $5

0 2011 CFO/Debt

EBITDA Margin

(US$ millions)

12%

10%

4%

2015

Capital Expenditures

11.0x

6%

20% 0%

2011

2015

Credit Metrics

12%

38.9%

0 2012 Contracted

14%

80%

$ 111

$ 72

$38 2011

$ 112

100

$174

$137

$ 119

2012

2013 Debt/EBITDA

2014

$11

$11

2014

2015

2015

EBITDA/Finance Expense

2011

2012

2013

20

Guacolda Summary of Historical Financials Revenues

EBITDA and EBITDA Margin

(US$ millions)

(US$ millions)

$613 $554

$515

$165

180.0

$438

50% 45%

160.0 140.0

$129

$117

30%

120.0 100.0

$122

35%

25%

30%

28%

80.0 60.0

5%

-

2013

2014

20%

10%

20.0

2012

25%

15%

19%

40.0

40%

0%

2012

2015

2013 EBITDA

Capital Expenditures

2014

2015

EBITDA margin

Credit Metrics

(US$ millions) 7.0

7.0x

7.2x

8

6.2x 7

6.0

$342

5.1x 5.0

6

4.6x

5 4.0

4

2.9x 3.0

$115

$98

3

3.9x

3.7x $125

2.0

2 1.0

1 0

-

2012 2012

2013

2014

2015

2013 Net Debt / EBITDA

2014

2015

EBITDA / Finance Expenses

21

Annex III: Major Assets

Diversified Asset Portfolio SIC coal – fired plants: 1,644 MW 

Ventanas Complex

Back – up plants: 816 MW 

− 4 Units

Nueva Renca − 379 MW – LNG / Diesel

− 884 MW - Coal

− Located in Santiago

− Located in Valparaíso Region − Start of operations: 1964/1977/2010/2013

− Start of operations: 1997 

Other plants: 437 MW

Hydro run-of-river plants and renewables: 284 MW 

Guacolda Complex



Alfalfal I

− 5 Units

− 178 MW – Hydro Run-of-River

− 760 MW - Coal

− Located 50 km from Santiago

− Located in Huasco (Northern part of the SIC)

− Start of operations: 1991

− Start of operations: 1995/1996/2009/2010/2015



Other plants: 106 MW − 93 MW – Other Hydro Run-of-River − 13 MW - Biomass

23

Diversified Asset Portfolio SING coal plants: 822 MW

Colombia: 1,000 MW



Norgener



AES Chivor

− 2 units

− 8 Units

− 277 MW – Coal

− 1,000 MW - Hydro

− Located in Tocopilla

− Located in Boyacá, Colombia

− Start of operations: 1995/1997

− Start of operations: 1977/1981

Argentina: 643 MW 

Angamos − 2 units − 545 MW – Coal



TermoAndes − Combined Cycle (2 Gas Turbines and 1 Steam Turbine) − 643 MW – Natural Gas

− Located in Mejillones

− Located in Salta, Argentina

− Start of operations: 2011

− Start of operations: 1999

Battery storage (BESS) & Solar: 53 MW 

Battery Storage: 32 MW − Norgener and Angamos − Start of operations: 2009/2011



Solar: 21 MW − Adjacent to Andes Substation − Start of operations: 2016

24

Annex IV: Other Financial information

Wide access to capital Successful financing for US$7bn growth Confirmation of investment grade rating by 3 agencies through a diversified financing strategy

Sources of Financing for the Expansions(1)

Amount (US$ million)

Cash from Operations

710

Capital Increases

668

Equity

Partners

682 International

300

Local

415

Bonds

Debt Banks

(1)

Project Finance

4,225

First and Second Phases: From 2007 – 2018.

26

Solid Performance Significant value creation for shareholders The largest total return to shareholders since 2010(1)… 250

AES Gener +93%

200

Colbún +40%

150

E-CL +40% Endesa +27%

100

IPSA +2%

50

0 2010

2011

2012

2013

… with an attractive dividend yield(2)…

4.5%

2015

2016

… and the highest payout ratio among peers(3) 6.3%

5.9%

2014

98%

5.2% 50%

41% 30%

2012 Source: (1) (2) (3)

2013

2014

Bloomberg as of February 24, 2015. In Chilean pesos, including dividends. LTM dividends paid / market capitalization end of period. Last 3 years average.

2015

Endesa

Colbun

EC-L

27