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

Nelson Ng - RBC Capital Markets Paul Tan - Credit Suisse Steven Paget - FirstEnergy Samir Ghafir - Raymond James Sean Steuart - TD Securities Ben Pham - BMO capital.

Thank you for standing by. This is the Chorus Call conference operator. Welcome to the Brookfield Renewable Energy Partners’ 2014 Fourth Quarter and Year-end Conference Call and Webcast. As a reminder, all participants are in a 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, 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 fourth quarter conference call. 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 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 also on our website.

Having greatly expanded our business in recent years, we have also been working to ensure that we have the systems, culture and more importantly the organization in place to effectively manage our business while delivering on our objectives for continued accretive growth.

With that in mind, I am very pleased to announce the appointment of Sachin Shah to the position of President and Chief Operating Officer, and Nick Goodman to the position of chief financial officer, who are both with me on the call this morning.

Sachin has been instrumental in developing and executing our business strategy, and effective immediately he will take on the responsibility for all of our operating platforms on a global basis.

After serving as the Chief Financial Officer of Brookfield’s European operations and joining Brookfield Renewable in 2014 as the Senior Vice President, Finance, Nick Goodman will assume full responsibility for the finances of Brookfield Renewable effective immediately.

With Sachin and Nick’s track record and leadership I believe that these changes will position us well to continue growing our business, maintain our strong operating values and quickly align and integrate new assets on a global basis.

So Brookfield Renewable has completed another successful year in 2014 with a total return of 24% on the New York Stock Exchange and 35% on the Toronto Stock Exchange.

Some of the key achievements this year would include generating $1.2 billion in adjusted EBITDA, completing or signing scale transactions in each of our three continental operating platforms, delivering $400 million in development projects on scope, schedule and budget, and making significant progress on growing our distributions to shareholders.

We are very pleased to have delivered strong returns to shareholders in 2014 and we plan to build upon this with an increase of our quarterly distribution, reflecting our strong cash flow profile and organic growth prospects. Now I will hand over the call to Sachin for comments on essentially our operations..

Thank you, Richard. Our businesses evolved significantly over the last few years and with the addition of our Irish wind portfolio we now have three continental platforms in North America, South America and Europe from which to grow.

Each platform benefits from strong local leadership and clear accountability for operations, and is responsible for identifying, executing and integrating new assets in its respective regions.

And although the business has grown significantly, our focus and approach remains the same, generating stable, high-quality cash flows that grow on a per-share basis over time, centered around our core strengths, marketing our power to capture rising prices and take advantage of cycles, advancing our high-quality development pipeline and building assets at premium returns, growing margins and reducing operating risk through our focus on operations and expertise, and finally investing capital globally to expand the business in each of the three continents where our operations reside.

Going into 2015, we almost have 2 terawatt hours of power that we acquired at cyclical low prices in the US North-east that positions us well to capture rising prices over the long term. In addition, we have positioned our portfolio in Brazil to benefit from the significant scarcity of power currently in the system.

We expect prices in Brazil to remain high and can capture that through approximately 20% of our portfolio there being uncontracted. On the project development front, we continue to advance our development pipeline with the objective of bringing 500 megawatts to 750 megawatts of Greenfield projects into operation over the next five years.

In that regard, we bought online our 45 megawatt Kokish River Hydro project in BC in 2014. In Ireland, the 88 megawatt Knockacummer and 37 megawatt Killhills wind projects are substantially complete and are generating revenue under their long-term contracts.

The 12 megawatt Glentane 2 wind project in Ireland and the 25 megawatt Serra dos Cavalinhos I hydro project in Brazil remain on track for commercial operation in 2015 and early 2017 respectively.

Looking forward, we have an additional approximately 100 megawatts of construction ready projects in Brazil and another 80 megawatts of construction ready projects in Ireland that should be built out over the next 24 months. From an M&A perspective, we invested or committed more than 3 billion of capital with our institutional partners in 2014.

These transactions will add over 1300 megawatts of additional power assets to our portfolio and demonstrate our ability to complete scale, value based opportunities in each of our core markets.

In North America we added 500 megawatts of hydro facilities in the North-east that provide strong cash flow in the near term and should grow in value over time as coal facilities continue to retire and the value of non-carbon emitting energy and capacity increases.

We completed our first acquisition in Europe with acquiring over 300 megawatts of operating wind and a meaningful development pipeline in Ireland.

Most importantly, this transaction provides us with a strong team that has exceeded our expectations in terms of their commercial capabilities and will allow us to confidently build a scalable, renewable energy business on the continent.

And more recently, our agreement to acquire a 488 megawatt diversified portfolio in Brazil will significantly expand our operating capacity in the country, adding two new technologies, wind and biomass, to our Latin American portfolio.

Looking forward, our global pipeline of opportunities continues to grow as our presence in each of our core markets expands. Our approach to transaction origination continues to focus on portfolios, where we can influence the key value drivers I previously referenced, our marketing, operations and development.

We believe the current environment has become increasingly favorable to companies like ourselves with strong operating expertise, a global mandate, and substantial access to capital.

The recent commodity related stress, the impact of low oil prices and the continued significant supply-side issues in our core markets are providing substantial opportunities to meaningfully grow our business.

As always, we look for and remain committed to value opportunities that will allow us to compound our capital at 12% to 15% over the long term. I will now hand over the call to Nick for a financial review..

Thank you, Sachin and good morning. BREP generated 1.2 billion in adjusted EBITDA and $560 million in funds from operations in 2014, in line with our annual plans, but below the prior year, which benefited from above average generation in North America and higher-priced contracts.

New assets, strong pricing and cost reduction efforts in North America and Brazil helped to mitigate less favorable hydro energy in the US and Brazil, and the suspension of operations at our natural gas facility in Ontario. We continued to generate meaningful cash flow to fund our operations, growth initiatives and development activities.

For the fourth quarter, generation of 5839 gigawatt hours was slightly above the long-term average of 5770 gigawatt hours and an increase of 571 gigawatt hours from the fourth quarter of 2013.

The hydro portfolio generated nearly 5000 gigawatt hours in line with the long-term average and an increase of approximately 400 gigawatt hours from the same period in 2013, reflecting strong inflows in Ontario and New England.

In Brazil, [Indiscernible] generation was below assured levels, due to continued drought-like conditions, but the impact was partially offset by participation in the national balancing pool and by successful marketing initiatives, which captured high selling prices for uncontracted generation.

Wind generation was 840 gigawatt hours in the fourth quarter, consistent with the long-term average and an increase of 337 gigawatt hours as compared to Q4 2013. The Irish wind portfolio acquired in June 2014 contributed 299 gigawatt hours. In the fourth quarter, adjusted EBITDA totaled $273 million, consistent with the prior year.

Stronger performance from our hydroelectric facilities in Canada, with high relative contract prices was partially offset by lower overall generation in the US. In Brazil, the optionality maintained in the portfolio allowed us to capture strong power pricing, partially offsetting the impact of the lower generation.

United States wind portfolio contributed an incremental 8 million compared to the prior year due to improved wind conditions.

Direct operating costs and interest expense were each $9 million higher, reflecting the substantial growth in the portfolio, and were partially offset by operating and financing cost efficiencies including up financings, repayments, and reductions in borrowing costs. Funds from operations for the quarter totaled $116 million.

We continued to fund the business on a long-term investment grade basis. During the quarter, we completed $1 billion of financing activity to refinance existing obligations, extend maturities, and enhance our capital structure.

Liquidity at year-end remained strong at $1 billion providing the financial resources and flexibilities to fund ongoing growth initiatives. As Richard indicated, we have a long and successful track record of executing our strategy and this has allowed us to steadily grow our distributions.

In light of our 2014 achievements and strong cash flow profile, we are announcing a 7% increase in our annualized distribution, consistent with our distribution growth target of 5% to 9% per year. That concludes our formal remarks. Thank you for joining us this morning. We would now be pleased to take your questions at this time.

Operator?.

[Operator Instructions] The first question today is from Nelson Ng from RBC Capital Markets. Please go ahead..

Thanks. Good morning everyone, and Sachin and Nick, congratulation on your new roles..

Thanks Nelson..

Thank you..

I had a few questions on Brazil, I was just wondering whether you can comment on the drought conditions and whether it has gone any better or worse?.

Sure. Nelson it is Sachin here. I think we have been talking for a couple of years now about really structural supply issues in Brazil that are a function of just consistent 30 year demand growth at 4% to 5% per year as more and more of that country’s middle class obviously consumes power, and supply not being able to keep up with that.

I think in the last two years that has been exacerbated by very low water levels in the country, and reservoir levels that have come down very, very significantly. We continue to see that theme right now, reservoir levels are very low. There is some dialogue around rationing.

I would say in the near term the government is projecting that they may have to do that. Our view internally is that if they do what they say, which is about 5% rationing across the board, it would have an impact to our business in the near term from a cash flow perspective of about $15 million to $20 million.

That being said, long-term it continues to play into our thesis, which is this is less about weather and more about not enough supply, and it gives us great confidence and conviction in making investments in the country, being a meaningful renewable owner in the country because we just think that that scarcity of supply will unlock tremendous value in the portfolio we own, but also in assets that we think we can acquire over the next few years..

So just to clarify in terms of that rationing, does that impact your assured levels, so are you kind of saying that there could be – you might be 5% below your assured levels if the Brazilian government does what they say?.

Correct. They would – it would impact hydro producers because obviously it is a water issue, and they would basically haircut your assured levels by the level of rationing that they are projecting..

Got it, okay.

And then just on the two Brazilian hydro developments that you guys recently acquired, so are those facilities contracted development or are you looking to sell power in the bilateral markets once they are completed?.

They are not contracted and we are keeping them uncontracted. In the near term I think just given the elevated pricing environment and the level of stress, we just feel that being patient and looking for opportunities to recontract. If you remember, in 2014 we signed five-year contracts at 270 reais per megawatt hour.

We signed other contracts in the 3 to 8 year range anywhere between 210 reais and 240 reais per megawatt hour and this would have been two years ago these contracts would have been signed at 120 reais and 150 reais per megawatt hour.

So being patient has been really helpful for us, and on those two projects we will continue to take that, but if we see tremendous value and the ability to lock in the cash flows long term we will do that too..

Okay, thanks, and then just one last question on FX, so like obviously the US dollar has appreciated over the last few months, I guess other than matching that with the asset geographies, do you turn to any FX hedges?.

Hi, Nelson it is Nick. Our FX hedging, we do hedge our exposure to CAD and Euro, so we have some hedging net investment hedges and we also have hedging program to hedge about 80% of our effort in the respective regions..

Got it. Okay, thanks for that..

The next question is from Paul Tan with Credit Suisse. Please go ahead..

Hi, good morning.

With regard to Brazil in terms of the cap pricing that is being lowered this year versus last year, are you seeing any changes in behavior among participants?.

Hi, Paul it is Sachin. So, yes, what you are referencing is the [PLB] cap that went from 822 reais previously to 388 reais a megawatt hour.Look, I think our view is that is not helpful for a few reasons.

One is, it obviously intends people to continue to consume power in an environment where there is a shortage, and then the more direct impact is marginal power in that country.

So when there isn’t enough water and demand is outstripping supply, the marginal power comes from thermal-based units that need more than 388 reais a megawatt hour to actually compensate them for their variable cost.

Our projections are they are anywhere between 700 reais and 900 reais a megawatt hour that you need on the margin to compensate the last unit that comes on. And so, in light of that what you are actually doing is putting further pressure on the supply side and making a challenging situation potentially worse. So we think this isn’t helpful long-term.

We actually think it provides further opportunities for us on the M&A side because some of those owners that have mixed portfolios, whether they own hydro and thermal, maybe further squeeze from a cash flow perspective and this actually may prove to be a great opportunity for us to acquire assets from some of those owners at compelling value..

Okay, thanks for that and regarding the opportunities that because of sort of FX between like the Euro, the CAD and the reais, what are sort of the dynamics within Brazil with the hydrology as well as the [CAP] pricing, where do you find most I guess opportunities in various regions, I mean would you rank one versus the other like in terms of best opportunity?.

Sure.

I would say if you look at 2014, what actually plays out and where you perceive the opportunities to be could be entirely different, but what I think we were trying to articulate in the prepared comments was we finally set up the organization in the three continents, where we can execute on large scale value opportunities in every market we are in.

So I have great confidence that we have investment teams that are now local in each of these markets that are looking and again we are always playing up our strengths.

Where we can find portfolios that focus on merchant power or rising revenues that we can capture over time, where we can build that development pipelines and where we can assets that need operating expertise in particular like hydro, those play to our strengths and allow us to carve away the competition that maybe more financial in nature, and don’t have the expertise to actually be able to buy those types of portfolios, or are looking for more contracted run-of-the-mill type assets.

In terms of opportunities, they are different everywhere. The US north-east has been a great place for us to acquire what I think will be value assets for the next 20 to 30 years in this business.

If you look at the hydros we bought in the last five years, Brazil is clearly going through distress both in the power markets, but broadly in the macro markets as well, and with the elections now over and with what is going on in the country, there may be further opportunities like we saw at the end of last year with Energisa.

In Europe, Europe has strong policy supporting renewables.

We all know the Eurozone has been in a debt crisis for the last five years and there is significant stimulus being poured into that economy, and there is significant change going on in terms of who owns assets and who has access to capital to actually keep – building out pipelines or acquiring portfolios.

Unfortunately, we are one of those with access with access to capital and operating expertise. So, I feel all of them are very good, but for different reasons. .

The next question is from Steven Paget with FirstEnergy. Please go ahead. .

Congratulations Sachin and Nick on your new roles. You've got about two Terawatts of U.S. generation that comes off contract in 2017, could you please talk about where that generation is and whether you were planning to contract out that power this year. .

Sure. That is the power that we've recently acquired in the last four years. So, we've been talking a lot on these calls about us buying merchant hydro in a $40 price environment.

Obviously, we have a power marketing capability, liquidity in the US Northeast markets typically 24-36 months, and so we will put on financial hedges if we find opportunities to lock in power prices above where we end the road and where we see strong value.

So, those contracts when they roll off we would continue with the same approach, which is contracting them in a short-term in the liquid wholesale markets and being patient to look for a long-term contracting opportunities.

We have the luxury of having bought this power at $40 to $45 a megawatt hour and so today anything we're earning in the current price cycle environment is better than what we bought..

You're seeing sort of PJM lasted the $64 range, last year?.

I would say yes, PJM and then remember we bought the pipeline assets in Neepol and so between Neepol and PJM, those are sort of the two principal markets where we've acquired assets in the last four years. And today in the winter pricing would be range bound anywhere between know $65 to $100 depending on the day you're looking.

And I see more broadly the curve on an overall basis is probably gone up $10 on a parallel basis just from three or four years ago in light of the pace of call retirement that we've seen..

Well, that’s good news.

Can you comment please more on the opportunities you're seeing in Canada in the next five years?.

Sure. I think we've said in Canada, we have a good development pipeline in Canada. A number of our opportunities I think will be more on the development side. On the M&A side we see opportunity but it wouldn’t be as significant as we see in the US.

And I think that is in part of function the smaller market in Canada and we've focused really on Ontario and BC as markets and both of those have been slower growth markets in Canada for the last number of years. .

The next question is from Samir Ghafir with Raymond James, please go ahead..

Actually both questions are already answered..

Mr. Sean Steuart from TD Securities, please go ahead..

Actually to Nick, one housekeeping question.

The construction ready projects that you have in Ireland and Brazil, can you give us a little more detail in the timeline and expect the capital cost for construction?.

We said we have 100 MW in Brazil, about 80 MW in Ireland, these would be -- so in Brazil this would be a combination of the pipeline that we have had for a few years now that the two assets that we just acquired which are fully permitted and ready to start construction.

And in Ireland these would all be assets that we acquired as a part of Bord Gáis acquisition and closed on in 2014. Target returns would be in the range of between 15% and 20%; I would say a little bit higher in Brazil and closer to lower end in Ireland.

And in terms of revenue profile, in Ireland all the projects would be supported by the feeding tariff there which has the floor price of about €80 megawatts hour, and in Brazil we -- I think one of the previous questions was around building merchant versus contracted, the assets could be built merchant and obviously we would look for contracts in the current environment.

From a capital cost perspective, you should expect that the Hydro in Brazil will cost us around $3 million to $4 million a megawatts, which in the current price environment; provides us with really exceptional returns. And in Ireland, it would be about €1 million a megawatts..

[Operator instruction] Next question is from Ben Pham with BMO capital, please go ahead..

I just wanted to go back to the question about the hedging of non-US FFO, and you indicated, Nick, 80% hedged, I'm just wondering how long did you actually hedge going out and do you have it at your fingertips, the sensitivity to FFO?.

Yes, I mean we looked to hedge 12 months on a rolling basis.

I'm sorry your question on sensitivity to FFO, I mean what we by hedging 80% we effectively removed the effects of those two currencies meaning that the exposure replaced to FFO was really the Brazilian Real, but as we've discussed before we have protection there through the inflation measure in our contracts in the country..

And then just wondering what the recent acquisition of the Brazilian portfolio that of course the 500 megawatts, a part of that portfolio included biomass [ph] which is a new technology you highlighted so.

Is that a one-off kind of technology as you just bought just with this particular acquisition, or is that area you see some opportunities going forward in your front footprints.

And can you also talk about just a different risk return profiles of food biomass compared to your existing historical portfolio?.

Sure, it is a little bit one, also meaning it unique to Brazil, biomass exist obviously in North America and Europe, but very different, it's more from wood fiber rather than in Brazil it's based on sugarcane by product which is called [biogas].

I think in Brazil it's a market that's -- the first issue with biomass that we always make sure that he understood the risk on with the ability of secure supply of the fiber that's needed to generate electricity.

In Brazil we were able to find a portfolio, one for a deep value from a very motivated seller that had their own balance sheet issues, and so we felt that the returns that we are undertaking all that we are underwriting compensated us for any of the risks on that mixed technology portfolio.

When it came to the biomass plant, like I said we got comfortable security of supply in Brazil, in light of the location of the underlying sugar mills and the underlying sugarcane resource. It's very well located in some of the best yielding regions of Brazil, coast of São Paulo, in the middle of the country.

And Brazil is the largest sugar exporter in the world and is also a large user of ethanol domestically which comes from their sugarcane resource.

So we been able to underwrite that, and would you see us buying more biomass in the country or gas-based terminal, we might, it's certainly not a core area for us, and you won't see us grow it as meaningfully as you will see us with the other technologies.

But if we can find the value opportunities along with other technologies, we are liking the country, like Hydro and wind, then you could see us [indiscernible] shouldn't expect us to be a major part of the portfolio..

There are no more questions at this time. I'll turn the conference over to Mr. Legault for closing comments. .

Well, once again thank you for joining us this morning and we really look forward to speaking to you in our first quarter of 2015 conference call and have a great day. Thank you..

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