Richard Legault - President and Chief Executive Officer Sachin Shah - Chief Financial Officer Nick Goodman - Senior Vice President, Finance.

Matthew Akman - Scotiabank Andrew Kuske - Credit Suisse Kelsey Roste - RBC Capital Markets Sean Steuart - TD Securities Steven Paget - FirstEnergy Capital Frederic Bastien - Raymond James.

Thank you for standing by. This is the Chorus Call conference operator. Welcome to the Brookfield Renewable Energy Partners’ 2014 Second Quarter Conference Call and Webcast. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions.

(Operator Instructions) At this time, I would like to turn the conference over to Richard Legault, President and Chief Executive Officer of Brookfield Renewable Energy Partners. Please go ahead, Mr. Legault..

Thank you, operator. Good morning, everyone and thank you for joining us this morning for our second quarter conference call. With me on the call are Sachin Shah, our Chief Financial Officer and Nick Goodman, our Senior Vice President, Finance.

Before we begin, I would like to remind you that a copy of our news release, investor supplement and letter to shareholders can be found on our website at www.brookfieldrenewable.com. I would also like to remind you that we may make forward-looking statements on this call.

These statements are subject to known and unknown risks and our future results may differ materially. For more information, you are encouraged to review our regulatory filings available on SEDAR, EDGAR and on our website as well. We are pleased to report another solid quarter with adjusted EBITDA of $360 million.

Our portfolio of both existing and new facilities performed very well driven by effective generation in resource management combined with high availability of our generation facilities in addition to strong market prices in both North America and Brazil.

Our portfolio has grown by over 2 million megawatt hours in the last 36 months and in the second quarter we have made significant progress on our growth and diversification strategy by completing our first European acquisition.

Over the long-term, we believe that companies such as ours will continue to be evaluated and differentiated in the marketplace based on the quality of their portfolios and operating platforms, their growth strategies, their access to capital and ultimately their ability to grow cash flow on a per share basis.

With our focus on hydro, significant upside embedded in our cash flows, our global mandate, a 15-year public track record, and our internal development pipeline, we are well positioned in this regard and believe that there is significant upside potential in our units.

I will now hand over the call to Sachin to provide you an update on our key initiatives in the quarter..

acquiring assets with exposure to rising prices in North America and Brazil, expanding the business into Europe and establishing a long-term operating platform on the continent, building out our development pipelines and acquiring projects at premium returns, evaluating solar as an asset class to invest in and complement our existing hydro and wind assets, while leveraging our operating platforms, and finally staying the course on investment grade and capital structure with a commitment to long-term fixed rate financings in this low rate environment.

Across the portfolio, we continue to make significant progress in each of our core markets centered around these themes.

In North America we benefit from a robust and stable business with predominantly contracted cash flows with much of our growth in the last four years adding a meaningful market based position to the portfolio representing about 10% of our total yearly generation and providing us with a low cost long-term option on rising electricity prices.

As expected our prices in Q2 moderated from the levels seen in Q1, but remain higher and more volatile than the prior year. And we expect prices will continue to face near and long-term upwards pressure from coal asset retirement and a stronger – and stronger economic activity over time.

On the growth side we expect to complete the acquisition of the remaining two-thirds interest in the 417 megawatts Safe Harbor hydroelectric station in the coming weeks. In Brazil power prices remain elevated and volatile.

While recent drought like conditions will eventually subside, the country continues to face the long-term effects of under investments in new supplies to meet continued growing demand. Although largely contracted we have been able to capture very high pricing for the small portion of our portfolio to remain as un-contracted.

We are also seeing increased demand from power customers for longer term contracts. During the quarter we signed contracts at prices ranging from 190 reais to 270 reais per megawatt hour substantially above our contracts that are expiring in the near-term.

As time goes on, we believe our portfolio is well positioned to capture more of these opportunities. In Europe, we completed the acquisition of our Irish wind portfolio during the quarter representing an important milestone in the establishment of a broader European platform.

We are fortunate to have acquired a deep and talented team, excellent operating assets and follow-on growth potential through the development pipeline. We currently have three wind projects totaling 137 megawatts under construction, 125 megawatts of which is expected to reach COD by the end of this year.

And we are progressing on a number of advanced stage development projects. While our near-term objectives are focused on maximizing the value of these assets, we are now actively seeking expansion opportunities in Europe.

In summary, all of our – our platforms in all three continents continue to make tremendous progress on our strategic objectives as they relate to capturing rising prices and expansion through acquisition and development.

Including the acquisition of Safe Harbor in the coming weeks, we will have acquired and/or developed more than 850 megawatts of high quality hydro and wind assets since the start of 2014. I will now hand over the call to Nick to discuss our financial results..

Thank you, Sachin and good morning. For the quarter adjusted EBITDA was $360 million and funds from operations was $198 million. We managed the effects of the late spring now in North America and succeeded in capturing strong pricing and volatility in both North America and Brazil, which contributed positively to results.

Total generation in the second quarter was 6200 gigawatt hours, consistent with the long-term average and the same period in the prior year. Hydroelectric generation was consistent with long-term average.

New facilities contributed 317 gigawatt hours in generation, while existing hydroelectric assets came in modestly below the prior year reflecting the very strong hydrology in Q2 of 2013. The late spring season now replenished our reservoirs, which ends Q3 at normal levels for this time of year.

Wind generation was modestly below long-term average reflecting lower wind conditions in North America. Our Irish wind portfolio performed largely in line with plan contributing 418 gigawatt hours through wind generation in the quarter. As Sachin indicated by maintaining the level of optionality in our U.S.

and Brazilian hydroelectric portfolios, we were able to capitalize on price volatility and secure long-term contracts that will create meaningful value over the next to 3 to 5 years.

In connection with these contracts, we incurred one-time transaction costs in Brazil totaling $20 million of which $7 million was recognized in the second quarter with the balance to be recognized during the third and fourth quarters of this year.

Operating costs were just compared to prior year reflective of cost efficiencies in our operations and the effects of foreign exchange. Despite the incurrence of the $7 million transaction cost in Brazil, EBITDA was broadly flat with same period last year.

Interest expense was down $4 million as compared to the same period last year to $102 million reflecting our active refinancing program that is adding duration to the portfolio and benefiting from the current low rate environment. Income tax expense of $6 million was in line with prior year.

Funds from operations for the quarter of $198 million increased $11 million compared to Q2 of 2013. FFO includes the $7 million upfront transaction costs incurred in Brazil and the $11 million contribution from the wind portfolio acquired in Ireland, the economic interest of which accrued to us from the beginning of this year.

Finally, during the quarter, we completed our first treasury offering of units since the partnership was launched in 2011, a bought-deal issuances, which raised gross proceeds of CAD$325 million.

Together with strong operating cash flows and prudent management of operating expenses, this contributed to a strong liquidity position of $1.2 billion at June 30 and is consistent with the prior quarter end. That concludes our formal remarks. Thank you for joining us this morning. We will be pleased to take your questions at this time..

(Operator Instructions) The first question today is from Matthew Akman of Scotiabank. Please go ahead..

Thank you very much. Good morning. I noticed that the hedge prices on forward years are higher than they were when you reported the first quarter results. And I am just wondering if you can discuss a little bit of where that derives, is that Brazil or Ireland or some combination, possibly the U.S.

hydro assets, maybe just provide a little bit more detail on that?.

Hey, Matt, it’s Sachin. Absolutely.

So, I would say yes, the immediate impact is from Brazil, we have been in a period as Nick alluded to where we are signing 3-year to 5-year contracts on prices anywhere in that 200 reais to 270 reais a megawatt hour and that would compare to contracts that were expiring in the 150 reais to 160 reais a megawatt hour range.

So, that clearly has an impact on our weighted average price that we received in the portfolio and in line with what we have been talking to you about for a few years. The Irish portfolio has contracts that range around €80 a megawatt hour. And so on a U.S.

dollar equivalent basis, it would also be slightly additive to the weighted average price of the portfolio..

So, it sounds like mostly Brazil is driving that?.

Correct..

Okay, thank you.

Sachin, do you have any comments on Mexico and any interest that you may or may not have there with some of the energy reforms going on?.

Sure. I mean, you look at market that we paid attention to. BAM actually has offices there that we stay in touch and plugged in with broadly. There is a lot of renewable energy policies that are being put in place in encouragement of renewable investment in Mexico. I think at this stage all we are doing is paying attention and observing.

And over time as part of our growth in the Americas, it could be an interesting market for us to allocate capital to..

Okay.

Just one more quick question on Ireland $11 million for the six months, is that a good run rate?.

Yes, it’s a good run rate..

Okay, thank you very much. Those are my questions..

Thanks Matt..

The next question is from Andrew Kuske of Credit Suisse. Please go ahead..

Thank you. Good morning. I guess the question is for Richard and it just relates to the commentary in the letter on yield cos and obviously we have seen a number of power market cycles in the last 15 or 20 years.

And if you could just give maybe some perspective on your thoughts on the current yield co phenomenon that’s happening and maybe compare to the run up in natural gas power plant builds in the late 90s? And then when we saw the wind spins and then wind power development being done really from let’s call it 4 through 7 or 8 thereabouts, just what’s your views on how this is maybe the same or a little bit different?.

Well, there is a lot of components to your question, Andrew. So, I will try to address most of it in the following comments.

If you look at yield cos today, I think that obviously they have been – we are acknowledging that clearly they have had an impact on the industry and how the industry is shaping, but at the same time, when we look at our business, we have always been focused on building a long-term sort of sustainable business that actually is focused on the quality of the portfolio, increasing our ability to capture organic upside if you want within the business by being strong operators, at the same time as growing our portfolio on a value basis meaning that every acquisition, every project had to add value to the portfolio that we currently have.

So, when we look at our track record, I think we have had a very strong track record of growth. So, we believe that we are extremely competitive with the new evolving or certainly emerging asset owners, which are the yield cos. But clearly, it’s brought more competition if you want to ask me that question.

At the same time, we believe that we have been more focused on areas, where we can add more value than basically just growing a pipeline of projects by operating better, by extracting better value out of the actual assets by.

If you look at our portfolio the last 36 months, we have mentioned this 2 megawatt hours were added at historically low cyclical prices. So, we think there is a lot of upside in our company and continued to sort of believe that, that’s going to position us extremely well in the future..

Okay, that’s helpful.

And then just on the value extraction comment, from a geographic perspective, where do you believe you could get the best risk adjusted returns at this point in time from the existing portfolio and then also from potential portfolio additions?.

Well, I think we are focused on three areas, North America, Brazil, and Europe and I believe that each one of these markets presents extremely good opportunities right now for us. If you look at North America, we have been extremely successful and more so in the hydro space to be quite frank.

I think there has been significant number of transactions in the last 18, 24 months on that front. We continue to feel that Brazil with ultimately an under-built or an undersupply to meet growing demand. We were certainly I think well-positioned in that respect. We continue to feel that it’s a great market for us to invest in the power sector.

And we believe that growing demand ultimately is not being met. It’s been exacerbated by drought conditions in the country, but the fact as a matter is that it’s much more a undersupply to meet demand that exists today.

So, we continue to view that that market will continue to be a strong market for us to build projects, but also for acquisitions, because there is probably less capital in Brazil today than there was three years ago.

In Europe, the current acquisition of Bord Gáis was really I think an important milestone for us to position ourselves and to be ready to continue to grow our portfolio in Europe. It establishes a meaningful footprint for us to build from. So, we are very optimistic on that particular market.

If you ask me which ones, I would say, Europe and Brazil today would probably be strong sort of markets for us in the next two, three years. North America, we continue to look for opportunities, but I think again, we have done a lot in North America in the last 24 months.

And clearly we think that Brazil and the other markets will certainly serve as well..

Okay, that’s very helpful. Thank you..

The next question is from Kelsey Roste of RBC Capital Markets. Please go ahead..

Good morning.

In terms of development, it sounds like there is lots of opportunities, in Brazil and Ireland, like you have been talking about, but specifically going to Canada, will you guys be participating in the Ontario and Quebec RFPs? And whether or not will you do this, if you are going to participate with the partner or alone?.

Well, again, we continue to look at both markets and the ability to sign long-term contracts than build projects. I would say that Ontario launched its larger renewable RFP recently. We continue to have projects in the province.

We will evaluate at this stage – I would say we will evaluate our likelihood with transmission access etcetera as to where or not we can submit a competitive bid. In Quebec, we have been working on various projects, but Quebec has not necessarily been in the area where we have a very large pipeline.

So, I would say don’t look too much to that market from us. Otherwise, we continue to look at Canada as a great place to invest in renewables, but really I think right now, we are looking at what RFPs or request for new supply is being put forward and assessing our ability to be competitive in those markets..

Great, thank you.

Moving over to Brazil, as you spoke mostly opportunities I believe are in hydro, but has Brookfield given any thought in moving into solar or wind opportunities in Brazil or Chile?.

Hi, Kelsey, it’s Sachin. Yes, we have absolutely looked at wind and solar in Brazil. We have obviously got a strong platform of hydro in Brazil, but given Richard’s comments about the tremendous undersupply in the country, both wind and solar represents good expansion opportunities. Wind is being built out in the country for four to five years now.

And so there are a lot of projects that are either existing or in sort of development stage that could be attractive for us to invest in.

On Chile, we wouldn’t look to Chile at this stage, we obviously have an investment through the broader BAM Group in the large transmission facility in the country and that precludes our ability to buy generation assets in Chile at this time..

Great, thank you. And then moving – speaking with Brazil, last quarter you guys had mentioned that you were advancing a 25-megawatt project and then there would probably be about another 150 megawatts looking to advance.

I was just wondering if you were able to provide any additional color on those developments and maybe when we should expect announcement?.

Sure. On the 25 – so first of all, all the projects are advancing very well. The 25 is, you are right, the nearest term project and it’s moving along well. We would expect that by the end of the year we have announcements out as to its progress. We are in the late stages of sort of evaluating the project prior to launching construction.

So, it’s moving along well and it’s certainly a project that would be well needed in the country and would provide us good value..

Great, thank you and that’s all my questions..

Thank you..

The next question is from Sean Steuart with TD Securities. Please go ahead..

Thanks. Good morning, everyone.

With respect to Ireland, wondering if you guys can give us an update on the 137 megawatts that’s under construction in terms of I guess timing in CapEx remaining? And then also on the other 300 million or 300 megawatts rather of development opportunities where do things stand with contracting there and then potential timing and CapEx for that build-out?.

Sure. So, I will start with the 137 megawatts, of that virtually all of it, about 130 megawatts is in advanced construction right now, Sean.

And so two things on that, one in terms of timing, much of that will get built out and completed by early 2015 and that is consistent with when we underwrote the business and made our investment decision and it’s all moving on plan.

In terms of capital, most of the equity in those projects has been already invested and in fact we are working on a financing to pull some of our equity out. So, you wouldn’t see meaningful dollars going into that at this stage, it’s really about repatriating some capital that’s already been invested.

In terms of the 300 megawatts that’s the development pipeline there, I’d say, about 100 megawatts of that we would envision building out over the next few years. It’s more near term. It has greater prospects for build-out. And probably 200 is what I’d call more of a long-dated option at this stage.

All of that – to put all that in perspective around contracts, you can still qualify for the tariff regime in Ireland, which is what all of our assets are underpinned by. And this is the €80 a megawatt hour contract for price, whereby if the market goes above that, you get the upside, but if you go below you are protected with the tariff floor..

Got it. Okay, the rest of my questions have been answered. Thanks guys..

Thanks, Sean..

Next question is from Steven Paget of FirstEnergy Capital. Please go ahead..

Good morning and thank you.

A question on Brazil is the country is undersupplied in power, is there an opportunity for significant that is 100 megawatt plus newbuilds?.

It’s Richard, Steve. I guess, yes, absolutely, I think there is a great need right now to build new supply in the country. I think that most of the plants that – they were counting on San Antonio and sort of Belo Monte and a lot of that bigger builds will come into play probably again a year or two from now.

But there is – even if when they commission those projects our estimate is that the country still needs significant new capacity to be built. So I believe that for us, we have always been successful in the smaller space, let’s say less than 30 megawatt facilities.

And we have always been keeping an eye out for projects that would be 50 megawatt to 250 megawatt. So again, we believe that that particular space, today the potential for new build is significant.

And as long as contracts are being put out by the government or at least the maximum price of auction reach a point that would be in the 160 reais to 170 reais per megawatt hour for an extended period of time. Those projects will get built..

Excellent. Thank you, Richard.

When – I mean there are a lot of participating non-controlling interests that are owned by others and where Brookfield has a controlled position and some of those are in funds and those funds may wind up over time, is it possible that Brookfield could at that point buy assets that it already knows and increase its net cash flows?.

Hi Steve, it’s Sachin. Yes, it’s possible. I think our job is to maximize value for all of our shareholders, whether it be public or private. So I think obviously at that time a decision will have to be made, but one viable opportunity is to buy it into the existing prep entity and continue on..

So I am correct, some of these funds do have a time limit on them?.

Absolutely, our private funds for example, our most recent private fund would be a 12-year fund with two one year extension options, so 14 years. They are long dated funds, but they absolutely have a timeline..

Thank you. Those are my questions..

Thanks..

(Operator Instructions) The next question is from Frederic Bastien with Raymond James. Please go ahead..

Good morning everyone. Question for Richard, you have been successful in the recent past buying mature assets from industrial owners such as Alcoa, does this particular segment of the market still offer the same kind of attractive opportunities that you have been able to get.

And obviously, there is a lot of owners out there that were looking to either deleverage their balance sheet or actually just streamline their operations, so I was wondering how the actual environment is currently in that particular sector?.

I think this is a very sort of question that I think comes back now and again particularly after we have added significant capacity from those types of sellers.

We continue to see a lot of potential in that particular segment buying from people that have had legacy assets where their industry isn’t working on all cylinders if you want to call it that.

And we have been successful at securing those transactions in North America particularly I think that there continues to be a potential to do so, I think in North America. But more again I would say there is starting to emerge an opportunity to do that in Brazil. So we are trying to leverage our experience here in North America and in other markets.

But again Frederic, I think you will see us continue to look at that particular segment of growth and talk to a lot of those people that own these types of assets and offer a really strong value proposal to them in being able to certainly acquire for good value and ultimately provide them with good value versus the business they are in..

Okay. Thanks.

And when you get – you are obviously excited about the opportunities in Europe, I mean what kind of sellers would you be looking at dealing with their assets – sellers of all types or?.

I think again we are – we have done a pretty good job at looking at which market that we actually like and would invest capital and deploy capital.

The various segments of sellers I would say continued to be a very fragmented development industry, like if you look at the developers in Europe they are actually, again they will build three projects, sell two to pay for the next three and keep one that’s a very common business model.

We find that there is going to be that segment is very active in terms of selling projects and ultimately I think are probably the prime targets today. There is also again legacy assets within industrial participants that we are looking at. Again similar segment than we have had in North America.

And again exploring with various groups how we can be helpful and partner with them on either development or portfolios where we bring expertise. Being a very unique company that has 8% of its portfolio in hydroelectric does have I think its appeal to a lot of the people in Europe that have somewhat a hydro portfolio..

Super, that’s helpful. Thank you very much..

There are no more questions at this time. I will now hand the call back over – there is a follow-up question from Steve Paget of FirstEnergy Capital. Please go ahead..

Thank you.

Just about these assets in Europe, how many of them would have legacy contracts and how many of them would have legacy contracts and how many would be selling at really a pure European market price?.

You mean – Steve do you mean the assets that we have just acquired in Ireland or….

No, those are €80 a megawatt, I mean, potentially assets that you might buy, would they generally be contracted or be merchant?.

I would say there is very little that actually is merchant or un-contracted in Europe. So they are generally being developed on long-term contracts.

And again those contracts tend to again it is very tight in terms of the pricing within the market because the construct of each market is very similar from one developer to the other in terms of the opportunities they are afforded. So, I would say, they are very similar and mostly contracted..

Even older assets that could date back decades?.

Older assets dating back decades are typically owned within sort of the local utilities and ultimately very seldom are for sale. So I wouldn’t really think that that’s an asset class that would be the most frequent that we could actually get access to and certainly access to sellers..

Thank you.

You talked about projects being developers building three and selling two keeping one, how big do these projects tend to be are they 10 megawatts, 50 megawatts, 200 megawatts?.

Well, as you know the landscape for projects in Europe is quite different than North America. The land map that’s available to develop projects is radically different, so projects tend to be much smaller in scale particularly in the wind space. So I would say typical projects would be 20 megawatts to 25 megawatts each.

But they tend to do maybe five, six sites at the same time. So that is where I think you can find a block of 100 megawatts to 200 megawatts fairly easy that is actually would give you at least scale and operating efficiency. But project by project I would say that the size is about 20 megawatts to 25 megawatts..

Thank you. Those are my questions..

This concludes the question-and-answer session. I will now turn the call back over to Mr. Legault..

Well, just again, just very thank full that you joined us this morning. I appreciate this is the summer period and certainly I think look forward to talking to you in our third quarter conference call. Thank you very much. And good – thank you..

This concludes today’s conference call. You may disconnect your lines. Thank you for participating and have a pleasant day..