AES Corporation

“The first station, Petersburg, consists of two coal-fired units; however, AES Indiana is in the process of converting these remaining two coal-fired units to natural gas in 2026 (see Integrated Resource Plan below).”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •forced outages; •exposure to fluctuations of the Argentine peso; •timely collection of FONINVEMEM installments and outstanding receivables (see Energy Markets and Regulatory Environment below); •natural gas prices and availability for contracted generation at TermoAndes; and •domestic energy demand and exports.”

Annual report 2025A · The company itself

“Commodity Price Risk AES generally seeks to hedge its exposure to commodity price risk; however, certain generation businesses may retain limited unhedged positions due to short‑term sales structures or contractual mismatches between supply and obligations. As a result, a portion of operating results may be exposed to changes in market prices for electricity, fuels, and environmental credits.”

Annual report 2025A · The company itself

“To the extent hydrological inflows are greater than or less than the contract volumes, the business will be sensitive to changes in spot power prices which may be driven by oil and natural gas prices in some time periods.”

Annual report 2025A · The company itself

“Fuel Costs — For our thermal generation plants, fuel is a significant component of our total cost of generation. For contract sales, we often enter into fuel supply agreements to match the contract period, or we may financially hedge our fuel costs.”

Annual report 2025A · The company itself

“29% of the capacity of our generation plants is fueled by natural gas.”

Annual report 2025A · The company itself

“Coal and natural gas are used as primary fuels. Coal prices are set by market factors internationally, while natural gas prices are generally set domestically.”

Annual report 2025A · The company itself

“Thermoelectric generation in the SADI is fueled primarily by natural gas. However, scarcity of natural gas during winter periods (June to August) due to transport constraints results in the use of alternative fuels, such as oil and coal.”

Annual report 2025A · The company itself

“The open market wholesale prices for electricity can be volatile and generally reflect the variable cost of the source generation which could include renewable sources at near zero pricing or thermal sources subject to fluctuating cost of fuels such as coal, natural gas, or oil derivative fuels in addition to other factors described below. Consequently, any changes in the generation supply stack and cost of coal, natural gas, or oil derivative fuels may impact the open market wholesale price of electricity.”

Annual report 2025A · The company itself

“In many cases, we also limit our exposure to fluctuations in fuel prices by entering into long-term contracts for fuel with a limited number of suppliers.”

Annual report 2025A · The company itself

“We often rely on a single contracted supplier or a small number of suppliers for the provision of fuel, transportation of fuel and other services required for the operation of some of our facilities. If these suppliers cannot perform, we would seek to meet our fuel requirements by purchasing fuel at market prices, exposing us to market price volatility and the risk that fuel and transportation may not be available during certain periods at any price, which could adversely impact the profitability of the affected business and our results of operations, and could result in a breach of agreements with other counterparties, including, without limitation, offtakers or lenders.”

Annual report 2025A · The company itself

“In the Dominican Republic, we own natural gas plants contracted under a portfolio of contract sales, and both contract and spot prices may move with commodity prices through 2027.”

Annual report 2025A · The company itself

“Our thermal assets in Panama have PPAs with distribution companies which match the term of the LNG supply agreement of such thermal assets.”

Annual report 2025A · The company itself

“29 | 2025 Annual Report Energy Infrastructure Our Energy Infrastructure SBU aims to provide energy security to enable the integration of new renewables and maximize the value of our gas generation and LNG business through flexible operations that support the energy transition.”

Annual report 2025A · The company itself

“Development Strategy — In Vietnam, we continue to advance the development of our Son My LNG terminal project, which has a design capacity of up to 9.6 million metric tonnes per annum, and the Son My 2 CCGT project, which has a capacity of about 2,250 MW.”

Annual report 2025A · The company itself

“Development Strategy — Given our LNG facility’s excess capacity in Panama, the company is developing natural gas supply solutions for third parties such as power generators and industrial and commercial customers. This strategy will support a growing demand for natural gas in the region and will contribute to AES' mission by reducing CO2 emissions as a result of using LNG.”

Annual report 2025A · The company itself

“AES partnered with Energas in a joint venture to operate the 50 km Eastern Pipeline and an LNG facility of 120,000 cubic meters, including additional storage, regasification, and truck loading capacity.”

Annual report 2025A · The company itself

“Overview Generation We currently own and/or operate a generation portfolio of 34,740 MW, including generation from our integrated utility, AES Indiana. Our generation fleet is diversified by technologies and fuel type.”

Annual report 2025A · The company itself

“This critical infrastructure is uniquely situated to support California in its transition to renewables with baseload gas-fired generation sited at high-demand points of interconnection within the Los Angeles Basin.”

Annual report 2025A · The company itself

“Andres owns and operates a combined cycle natural gas turbine and an energy storage facility with combined generation capacity of 329 MW, as well as the only LNG import terminal in the country, with 160,000 cubic meters of storage capacity. Los Mina owns and operates a combined cycle facility with two natural gas turbines and an energy storage facility with combined generation capacity of 368 MW.”

Annual report 2025A · The company itself

“The four coastal power plants comprising AES Southland are in areas that are critical for local reliability and play an important role in integrating the increasing amounts of renewable generation resources in California.”

Annual report 2025A · The company itself

“The wholesale prices offered for electricity have been volatile in the markets in which we operate due to a variety of factors, including the increased penetration of renewable generation and energy storage resources, low-priced natural gas, demand side management, new regulations, and market rules.”

Annual report 2025A · The company itself

“The levelized cost of electricity from new solar and wind generation sources has decreased substantially over the past decade as solar panel costs and wind turbine costs have declined, while wind and solar capacity factors have increased. These renewable resources have no fuel costs and very low operational costs, while only operating during certain periods of time (daylight) or weather conditions (higher winds).”

Annual report 2025A · The company itself

“The evolution of competitive electricity markets and the development of highly efficient gas-fired power plants and renewables such as wind and solar have also caused, and could continue to cause, price pressure in certain power markets where we sell or intend to sell power.”

Annual report 2025A · The company itself

“Technological changes that could impact our businesses include: •technologies that change the utilization of electric generation, transmission and distribution assets, including the expanded cost-effective utilization of distributed generation (e.g., rooftop solar and community solar projects), and energy storage technology; •advances in distributed and local power generation and energy storage that reduce demand for large-scale renewable electricity generation or impact our customers’ performance of long-term agreements; and •more cost-effective batteries for energy storage, advances in solar or wind technology, and advances in alternative fuels and other alternative energy sources.”

Annual report 2025A · The company itself

“For example, the level of wind resource affects the revenue produced by wind generation facilities. Because the levels of wind and solar resources are variable and difficult to predict, our results of operations for individual wind and solar facilities specifically, and our results of operations generally, may vary significantly from period to period, depending on the level of available resources.”

Annual report 2025A · The company itself

“Additionally, the market rules in the wholesale electric markets in which we operate continue to evolve in response to, among other things, increasing penetration by renewable energy resources and energy storage systems. For example, some wholesale electric market regions have either implemented or are considering changes to how resource adequacy or capacity attributes are allocated to intermittent generating resources.”

Annual report 2025A · The company itself

“AES Andes' Green Blend strategy aims to reduce carbon intensity and to incorporate renewable energy to extend our previous conventional PPAs by de-linking our PPAs from legacy fossil resources while growing our renewable energy portfolio. This strategy delivers a competitive and reliable energy solution for customers, AES Chile has committed to advance the development of new renewables projects, including the implementation of BESS and other technological innovations that will provide greater flexibility and reliability to the system.”

Annual report 2025A · The company itself

“Development Strategy — In order to explore new business opportunities, AES El Salvador created AES Soluciones, an LED public lighting service provider and the main commercial and industrial solar photovoltaic EPC provider in the country.”

Annual report 2025A · The company itself

“In 2025, we signed long-term contracts for 4.0 GW of renewables, bringing our backlog of projects — those with signed contracts, but which are not yet in operation — to 12.0 GW. Our backlog serves as one of the core components of our future growth.”

Annual report 2025A · The company itself

“Overview Generation We currently own and/or operate a generation portfolio of 34,740 MW, including generation from our integrated utility, AES Indiana. Our generation fleet is diversified by technologies and fuel type.”

Annual report 2025A · The company itself

“54% of the capacity of our generation plants is fueled by renewables, including solar, hydro, wind, energy storage, and landfill gas, which do not have significant fuel costs.”

Annual report 2025A · The company itself

“The first is a 195 MW solar project ("Hardy Hills Solar"). The second is a 106 MW wind facility ("Hoosier Wind"). The third is a 200 MW (800 MWh) battery energy storage project ("Pike County BESS"). The fourth is a 250 MW solar and 45 MW (180 MWh) energy storage facility ("Petersburg Energy Center").”

Annual report 2025A · The company itself

“AES El Salvador owns and operates four solar farms: Opico Power, Moncagua, and Metapan with 4 MW, 3 MW, and 15 MW of capacity, respectively, and Meanguera del Golfo, a solar and battery storage facility with 1 MW capacity; as well as AES Nejapa, a biomass power plant with 6 MW capacity; and 50% of Bosforo and Cuscatlan, solar farms with 100 MW and 10 MW capacity, respectively.”

Annual report 2025A · The company itself

“Maximo Business Description — Maximo is an AI-enabled robot that enhances solar module installation speed, efficiency, and safety. Maximo enhances the safety and scalability of solar installation by automating the heavy lifting for placing and attaching solar modules.”

Annual report 2025A · The company itself

“The financial performance of our renewables business is also impacted by our ability to complete construction projects and earn U.S. renewable tax credits.”

Annual report 2025A · The company itself

“Tax credits associated with the development of U.S. renewables projects can be substantial and have increased with the adoption of the Inflation Reduction Act ("IRA"). In 2025, AES recognized $1.5 billion related to the monetization of tax attributes to tax equity investors and transferability tax credit buyers relating to U.S. renewables projects, $166 million of which relates to solar projects owned by our utility at AES Indiana.”

Annual report 2025A · The company itself

“These tax credits are supportive of our strategy to grow the AES Clean Energy business through the development of our 46 GW U.S. pipeline.”

Annual report 2025A · The company itself

“In December 2022, Bulgaria implemented Regulation 2022/1854, approved by the European Council in October 2022 as an emergency intervention aiming at limiting energy prices in Europe. The main measure of interest to AES in Bulgaria is the limitation of revenues for "infra-marginal" producers, a category that includes renewables and other technologies which are providing electricity to the grid at a cost below the price level set by the more expensive “marginal” producers.”

Annual report 2025A · The company itself

“Decarbonization — The Chilean government’s decarbonization plan includes the complete retirement of the SEN coal fleet by the end of 2040 and carbon neutrality by 2050.”

Annual report 2025A · The company itself

“Many of the countries in which the Company does business have laws and regulations relating to the siting, construction, permitting, ownership, operation, modification, repair and decommissioning of, and power sales from electric power generation or distribution assets. In addition, international projects funded by the International Finance Corporation, the private sector lending arm of the World Bank, or many other international lenders are subject to World Bank environmental standards or similar standards, which tend to be more stringent than local country standards.”

Annual report 2025A · The company itself

“Environmental laws and regulations affecting electric power generation and distribution facilities are complex, change frequently, and have become more stringent over time. The Company has incurred and will continue to incur capital costs and other expenditures to comply with these environmental laws and regulations. The Company may be required to make significant capital or other expenditures to comply with these regulations.”

Annual report 2025A · The company itself

“CSAPR — CSAPR addresses the "good neighbor" provision of the CAA, which prohibits sources within each state from emitting any air pollutant in an amount which will contribute significantly to any other state’s nonattainment of, or interference with maintenance of, any NAAQS. The CSAPR is implemented in part through a market-based program under which compliance may be achievable through the acquisition and use of emissions allowances created by the EPA.”

Annual report 2025A · The company itself

“The GHG NSPS for new EGUs remains in effect at this time, and absent further action from the EPA that rescinds or substantively revises the NSPS, it could impact any Company plans to construct and/or modify or reconstruct electric generating units in some locations, which may have a material impact on our business, financial condition, or results of operations.”

Annual report 2025A · The company itself

“In particular, the Company's U.S. facilities are subject to the CWA Section 316(b) rule issued by the EPA effective in 2014 that seeks to protect fish and other aquatic organisms drawn into cooling water systems at power plants and other facilities. These standards require affected facilities to choose among seven best technology available ("BTA") options to reduce fish impingement.”

Annual report 2025A · The company itself

“Certain AES Southland OTC units were required to be retired to provide interconnection capacity and/or emissions credits prior to startup of new (air cooled) generating units, and the remaining AES OTC generating units in California have been or will be shut down and permanently retired by the applicable OTC Policy compliance dates for the respective units. The SWRCB OTC Policy currently requires the shutdown and permanent retirement of the remaining OTC generating units at AES Huntington Beach, LLC and AES Alamitos, LLC by December 31, 2026, as extended in support of grid reliability.”

Annual report 2025A · The company itself

“Risks associated with Governmental Regulation and Laws Our operations are subject to significant government regulation and could be adversely affected by changes in the law or regulatory schemes. Our ability to predict, influence or respond appropriately to changes in law or regulatory schemes, including obtaining expected or contracted increases in electricity tariff or contract rates or tariff adjustments for increased expenses, could adversely impact our results of operations.”

Annual report 2025A · The company itself

“Regulation, such as the initiatives in Chile and the Puerto Rico Energy Public Policy Act, may adversely affect our operations.”

Annual report 2025A · The company itself

“In October 2015, Law 27,191 was passed, seeking to create a successful framework for the development of renewable energy. This law set an objective of 8% renewable energy by 2017 and 20% by 2025 and also introduced tax exemptions for importing equipment used in the construction of renewable energy projects in addition to other tax benefits.”

Annual report 2025A · The company itself

“The four coastal power plants comprising AES Southland are in areas that are critical for local reliability and play an important role in integrating the increasing amounts of renewable generation resources in California.”

Annual report 2025A · The company itself

“The wholesale prices offered for electricity have been volatile in the markets in which we operate due to a variety of factors, including the increased penetration of renewable generation and energy storage resources, low-priced natural gas, demand side management, new regulations, and market rules.”

Annual report 2025A · The company itself

“The levelized cost of electricity from new solar and wind generation sources has decreased substantially over the past decade as solar panel costs and wind turbine costs have declined, while wind and solar capacity factors have increased. These renewable resources have no fuel costs and very low operational costs, while only operating during certain periods of time (daylight) or weather conditions (higher winds).”

Annual report 2025A · The company itself

“The evolution of competitive electricity markets and the development of highly efficient gas-fired power plants and renewables such as wind and solar have also caused, and could continue to cause, price pressure in certain power markets where we sell or intend to sell power.”

Annual report 2025A · The company itself

“For example, the level of wind resource affects the revenue produced by wind generation facilities. Because the levels of wind and solar resources are variable and difficult to predict, our results of operations for individual wind and solar facilities specifically, and our results of operations generally, may vary significantly from period to period, depending on the level of available resources.”

Annual report 2025A · The company itself

“Additionally, the market rules in the wholesale electric markets in which we operate continue to evolve in response to, among other things, increasing penetration by renewable energy resources and energy storage systems. For example, some wholesale electric market regions have either implemented or are considering changes to how resource adequacy or capacity attributes are allocated to intermittent generating resources.”

Annual report 2025A · The company itself

“AES Andes' Green Blend strategy aims to reduce carbon intensity and to incorporate renewable energy to extend our previous conventional PPAs by de-linking our PPAs from legacy fossil resources while growing our renewable energy portfolio. This strategy delivers a competitive and reliable energy solution for customers, AES Chile has committed to advance the development of new renewables projects, including the implementation of BESS and other technological innovations that will provide greater flexibility and reliability to the system.”

Annual report 2025A · The company itself

“Resulting from this IRP, AES Indiana also added three renewables projects to its generation portfolio: Pike County BESS, Hoosier Wind, and Crossvine.”

Annual report 2025A · The company itself

“In 2025, we signed long-term contracts for 4.0 GW of renewables, bringing our backlog of projects — those with signed contracts, but which are not yet in operation — to 12.0 GW. Our backlog serves as one of the core components of our future growth.”

Annual report 2025A · The company itself

“Overview Generation We currently own and/or operate a generation portfolio of 34,740 MW, including generation from our integrated utility, AES Indiana. Our generation fleet is diversified by technologies and fuel type.”

Annual report 2025A · The company itself

“54% of the capacity of our generation plants is fueled by renewables, including solar, hydro, wind, energy storage, and landfill gas, which do not have significant fuel costs.”

Annual report 2025A · The company itself

“The first is a 195 MW solar project ("Hardy Hills Solar"). The second is a 106 MW wind facility ("Hoosier Wind"). The third is a 200 MW (800 MWh) battery energy storage project ("Pike County BESS"). The fourth is a 250 MW solar and 45 MW (180 MWh) energy storage facility ("Petersburg Energy Center").”

Annual report 2025A · The company itself

“This framework fostered AES Argentina's construction of Vientos Bonaerenses and Vientos Neuquinos power plants, which are fully contracted with public and private customers in the long term.”

Annual report 2025A · The company itself

“At the end of 2023, AES Colombia obtained the environmental license, issued by the ANLA, for the 500 kV line to connect the Guajira pipeline projects. Currently, AES Colombia has obtained environmental licenses for 406 MW of wind projects in Guajira.”

Annual report 2025A · The company itself

“The global utility scale market, excluding China, will add approximately 3,201 GWh of energy storage capacity between 2024 and 2035, according to the Bloomberg NEF 2H 2025 Energy Storage Market Outlook, published in October 2025. Additional growth opportunities exist in providing operational and maintenance services associated with energy storage products, as well as the provision of digital applications and solutions to improve performance and economic output.”

Annual report 2025A · The company itself

“Technological changes that could impact our businesses include: •technologies that change the utilization of electric generation, transmission and distribution assets, including the expanded cost-effective utilization of distributed generation (e.g., rooftop solar and community solar projects), and energy storage technology; •advances in distributed and local power generation and energy storage that reduce demand for large-scale renewable electricity generation or impact our customers’ performance of long-term agreements; and •more cost-effective batteries for energy storage, advances in solar or wind technology, and advances in alternative fuels and other alternative energy sources.”

Annual report 2025A · The company itself

“Resulting from this IRP, AES Indiana also added three renewables projects to its generation portfolio: Pike County BESS, Hoosier Wind, and Crossvine.”

Annual report 2025A · The company itself

“54% of the capacity of our generation plants is fueled by renewables, including solar, hydro, wind, energy storage, and landfill gas, which do not have significant fuel costs.”

Annual report 2025A · The company itself

“AES Indiana also operates a 20 MW battery-based energy storage unit at this location, which provides frequency response.”

Annual report 2025A · The company itself

“The first is a 195 MW solar project ("Hardy Hills Solar"). The second is a 106 MW wind facility ("Hoosier Wind"). The third is a 200 MW (800 MWh) battery energy storage project ("Pike County BESS"). The fourth is a 250 MW solar and 45 MW (180 MWh) energy storage facility ("Petersburg Energy Center").”

Annual report 2025A · The company itself

“AES El Salvador owns and operates four solar farms: Opico Power, Moncagua, and Metapan with 4 MW, 3 MW, and 15 MW of capacity, respectively, and Meanguera del Golfo, a solar and battery storage facility with 1 MW capacity; as well as AES Nejapa, a biomass power plant with 6 MW capacity; and 50% of Bosforo and Cuscatlan, solar farms with 100 MW and 10 MW capacity, respectively.”

Annual report 2025A · The company itself

“Fluence Business Description — Fluence, created in 2018 as a joint venture by AES and Siemens AG, is a leading global provider of energy storage and services and AI-enabled digital applications for renewables and storage. On November 1, 2021, Fluence Energy, Inc. completed its IPO and is listed on Nasdaq under the symbol "FLNC".”

Annual report 2025A · The company itself

“Key Financial Drivers — AES Ohio's financial results are driven primarily by retail demand and weather.”

Annual report 2025A · The company itself

“Key Financial Drivers — AES Southland's availability is one of the most important drivers of operations, along with market demand and prices for gas and electricity.”

Annual report 2025A · The company itself

“ESP 4 is a comprehensive plan to enhance and upgrade its network and improve service reliability, provide safeguards for price stability, and continue investments in local economic development.”

Annual report 2025A · The company itself

“Southland Energy — AES Huntington Beach Energy, LLC and AES Alamitos Energy, LLC (collectively "Southland Energy") each operate under 20-year tolling agreements with Southern California Edison ("SCE") to provide 1,387 MW of combined cycle gas-fired generation (through 2040). The contracts are Resource Adequacy Purchase Agreements (“RAPAs”) with annual energy tolling put options.”

Annual report 2025A · The company itself

“Private companies operate in all three segments, and generators can enter into PPAs to sell energy to regulated and unregulated customers, as well as to other generators in the spot market.”

Annual report 2025A · The company itself

“We are also seeing additional investment opportunities from data center growth in our utility service areas, above and beyond existing rate base projections. Our utilities have many natural advantages that are attractive to large technology companies, such as proximity to fiber networks and the presence of ample land and water. We have worked to proactively identify sites that are well-positioned to support new data centers, capitalizing on our deep relationships with technology companies.”

Annual report 2025A · The company itself

“The expansion of data center needs related to the growing use of generative artificial intelligence are expected to be a significant accelerant to the growth of the U.S. renewables market and AES seeks to capture a significant portion of this market expansion.”

Annual report 2025A · The company itself

“The focus of our strategy is to partner with large corporations to deliver the electricity they need when they need it. We are very well-positioned as a leading provider of renewable energy to data center companies, particularly in the U.S., and to large mining companies outside the U.S. These customers want to work with AES due to our track record of providing customized solutions that best serve their specific needs and delivering our projects on time and on budget.”

Annual report 2025A · The company itself

“For corporate customers, this includes advanced 24/7 carbon‑free energy offerings tailored to support large energy‑intensive operations, such as hyperscale data centers, by combining renewables, storage, and load‑siting solutions.”

Annual report 2025A · The company itself

“The expansion of advanced manufacturing and data centers has the potential to significantly accelerate the demand for electricity in the U.S. power markets. AES Indiana and AES Ohio have an obligation to serve customers who are located in our service territory and are working with several companies to provide solutions for the electric service needs of data centers and advanced manufacturing facilities. We see these relationships growing with the expansion of their use within our service territory.”

Annual report 2025A · The company itself

“The expansion of data center needs related to the growing use of generative artificial intelligence are expected to be a significant accelerant to the growth of the U.S. renewables market and AES seeks to capture a significant portion of this market expansion.”

Annual report 2025A · The company itself

“AES has worked with several major technology companies to provide clean energy solutions to power their networks of data centers, and we expect these relationships to expand as the rapid adoption of generative artificial intelligence drives significant growth in data center electricity demand.”

Annual report 2025A · The company itself

“We may incur significant expenditures to adapt our businesses to technological changes. Emerging technologies may be superior to, or may not be compatible with, some of our existing technologies, investments and infrastructure, and may require us to make significant expenditures to remain competitive, or may result in the obsolescence of certain of our operating assets.”

Annual report 2025A · The company itself

“35 | 2025 Annual Report New Energy Technologies Our New Energy Technologies SBU encompasses AES' efforts to incubate innovative solutions and invest in businesses that leverage cutting-edge technology to provide greener and smarter energy solutions, accelerating the energy transition. These activities enhance AES' competitive advantages in its businesses while enabling the growth of new business platforms.”

Annual report 2025A · The company itself

“A downgrade in the credit ratings of The AES Corporation or its subsidiaries could adversely affect our access to the capital markets, interest expense, liquidity, or cash flow. 69 | 2025 Annual Report If any of the credit ratings of The AES Corporation and its subsidiaries were to be downgraded, our ability to raise capital on favorable terms could be impaired and our borrowing costs could increase.”

Annual report 2025A · The company itself

“We have sought to reduce counterparty credit risk under our long-term contracts by entering into power sales contracts with utilities or other customers of strong credit quality and by obtaining guarantees from certain sovereign governments of the customer's obligations; however, many of our customers do not have or have not maintained, investment-grade credit ratings. Our generation businesses cannot always obtain government guarantees and if they do, the government may not have an investment grade credit rating.”

Annual report 2025A · The company itself

“Generally, demand for electricity peaks in winter and summer. Typically, when winters are warmer than expected and summers are cooler than expected, demand for energy is lower, resulting in less demand for electricity than forecasted.”

Annual report 2025A · The company itself

“Commodity Price Risk AES generally seeks to hedge its exposure to commodity price risk; however, certain generation businesses may retain limited unhedged positions due to short‑term sales structures or contractual mismatches between supply and obligations. As a result, a portion of operating results may be exposed to changes in market prices for electricity, fuels, and environmental credits.”

Annual report 2025A · The company itself

“In Colombia, we operate under a shorter-term sales strategy with spot market exposure for uncontracted volumes. Because we own hydroelectric assets there, contracts are not indexed to fuel.”

Annual report 2025A · The company itself

“Utilities Our utility businesses consist of AES Indiana and AES Ohio in the U.S., and four utilities in El Salvador. AES' six utility businesses distribute power to 2.7 million customers and AES' two utilities in the U.S. also include generation capacity totaling 4,056 MW.”

Annual report 2025A · The company itself

“Our hydro assets are mainly contracted through medium to long-term PPAs with distribution companies, while a small volume of our hydro plants are contracted with unregulated users. Our hydro assets in Panama have PPAs with distribution companies expiring up to December 2030 for a total contracted capacity of 350 MW.”

Annual report 2025A · The company itself

“AES Indiana offers electricity in the MISO day-ahead and real-time markets.”

Annual report 2025A · The company itself

“AES Ohio has the exclusive right to provide transmission and distribution services to its customers, and procures retail standard service offer ("SSO") electric service on behalf of residential, commercial, industrial, and governmental customers through a competitive bid auction process.”

Annual report 2025A · The company itself

“From July 2025 onwards, Bulgarian distribution companies serving the regulated market are sourcing their electricity needs exclusively from a special segment of the market where NEK is the main supplier through their energy mix (consisting of NEK-owned HPPs, NPP Kozlodui, state owned TPP Maritza East 2, and AES Maritza).”

Annual report 2025A · The company itself

“Bulgaria has 17 GW of installed capacity enabling the country to meet and exceed domestic demand and export energy. Installed capacity is primarily composed of solar (34%), thermal (31%), hydro (19%), and nuclear (12%) generation.”

Annual report 2025A · The company itself

“Panama's current total installed capacity is 5,077 MW, composed of thermal (43%), hydroelectric (36%), solar (14%), and wind (7%) generation.”

Annual report 2025A · The company itself

“Mexico has an installed capacity of 92 GW, composed of thermal (64%), hydroelectric (14%), solar (8%), wind (8%), and other fuel (6%) generation.”

Annual report 2025A · The company itself

“Colombia Electricity supply in Colombia is concentrated in one main system, the SIN, which encompasses one-third of Colombia's territory and provides electricity to 99% of the country's population. As of December 31, 2025, the SIN's installed capacity was 21,040 MW, composed of hydroelectric (63%), thermal (30%), and other renewables (7%) generation. The marked seasonal variations in Colombia's hydrology result in price volatility in the short-term market.”

Annual report 2025A · The company itself

“The Vietnam power market is divided into three regions (North, Central, and South), with total installed capacity of approximately 82 GW. The fuel mix in Vietnam is composed primarily of coal (32%), hydroelectric (29%) and renewables generation, including solar, wind, and biomass (26%). EVN, the national utility, owns 38% of installed generation capacity.”

Annual report 2025A · The company itself

“For our generation businesses, our priority for development is in key growth markets, such as the U.S. and Chile, where we can leverage our global scale and synergies with our existing businesses by adding renewable energy. We make the decision to invest in new projects by evaluating the strategic fit, financial profile, projected returns, and risk for the investment and against alternative uses of capital, including corporate debt repayment.”

Annual report 2025A · The company itself

“The plant is fully contracted through a long-term PPA with PREPA expiring in 2037.”

Annual report 2025A · The company itself

“At the same time, we have embarked on the most ambitious investment growth in the history of our U.S. utilities, which will improve the reliability and quality of service for our customers, while maintaining some of the lowest rates in both states where our utilities operate. AES Indiana and AES Ohio are now two of the fastest growth U.S. utilities, with projected double-digit rate base growth through 2027, based on necessary investments for our 6 | 2025 Annual Report customers.”

Annual report 2025A · The company itself

“AES Indiana, our fully integrated regulated utility, and AES Ohio, our transmission and distribution regulated utility, each operate as the sole distributors of electricity within their respective jurisdictions. AES Indiana owns and operates all of the facilities necessary to generate, transmit, and distribute electricity. AES Ohio owns and operates all of the facilities necessary to transmit and distribute electricity.”

Annual report 2025A · The company itself

“In the Utilities segment, AES operates four utilities in El Salvador with installed operating capacity of 143 MW, as well as an integrated utility in Indiana, with installed operating capacity of 4,056 MW.”

Annual report 2025A · The company itself

“AES Indiana is an integrated utility that is engaged primarily in generating, transmitting, distributing, and selling electric energy to retail customers in the city of Indianapolis and neighboring areas within the state of Indiana and is subject to regulatory authority—see Regulatory Framework and Market Structure below. AES Indiana has an exclusive right to provide electric service to the customers in its service area, covering about 528 square miles with an estimated population of approximately 982,000 people.”

Annual report 2025A · The company itself

“AES Ohio is a utility company that transmits and distributes electricity to approximately 541,000 retail customers in a 6,000 square mile area of West Central Ohio and is subject to regulatory authority—see Regulatory Framework and Market Structure below.”

Annual report 2025A · The company itself

“This segment comprises generation facilities using natural gas, LNG, coal, pet coke, diesel, and/or oil, in nine countries — Vietnam, the United States, Argentina, Chile, Bulgaria, Mexico, Jordan, Panama, and the Dominican Republic.”

Annual report 2025A · The company itself

“Conventional Generation Business Description — In the U.S., we own a conventional generation portfolio. The principal markets and 30 | 2025 Annual Report locations where we are engaged in the generation and supply of electricity (energy and capacity) are the California Independent System Operator ("CAISO") and Puerto Rico.”

Annual report 2025A · The company itself

“AES Southland Business Description — AES Southland is one of the largest generation operators in California by aggregate installed capacity, with an installed gross capacity of 2,823 MW at the end of 2025.”

Annual report 2025A · The company itself

“AES Indiana is one of many transmission system owner members in MISO, an RTO which maintains functional control over the combined transmission systems of its members and manages one of the largest energy and ancillary services markets in the U.S.”

Annual report 2025A · The company itself

“AES Ohio is a member of PJM, an RTO that operates the transmission systems owned by utilities operating in all or parts of a multi-state region, including Ohio.”

Annual report 2025A · The company itself

“AES El Salvador Business Description — AES El Salvador is the majority owner of four of the five distribution companies operating in El Salvador (CAESS, CLESA, EEO, and DEUSEM).”

Annual report 2025A · The company itself

“Colon in Panama has PPAs with distribution companies for a total contracted capacity of 350 MW expiring in August 2028, which matches the term of the LNG supply agreement of such thermal assets.”

Annual report 2025A · The company itself

“In our generation business, we own and/or operate power plants to sell power to wholesale customers such as utilities and other intermediaries, as well as to large corporations. Our utilities sell to end-user customers in the residential, commercial, industrial, and governmental sectors in a defined service area.”

Annual report 2025A · The company itself

“Panama The Panamanian power sector is composed of three distinct operating business units: generation, distribution, and transmission. Generators can enter into short-term and long-term PPAs with distributors or unregulated consumers. In addition, generators can enter into backup supply contracts with each other.”

Annual report 2025A · The company itself

“The Mong Duong 2 power plant is a BOT plant and does not directly participate in the electricity market. The offtaker bids Mong Duong 2’s tariff into the market on its behalf.”

Annual report 2025A · The company itself

“Puerto Rico Puerto Rico has a single electric grid managed by PREPA, a state-owned entity that provides virtually all of the electric power consumed in Puerto Rico and generates, transmits, and distributes electricity to 1.5 million customers. Since June 2021, PREPA has contracted LUMA Energy to manage the transmission, distribution, and commercialization activities.”

Annual report 2025A · The company itself

“The financial performance of our facilities is dependent on the credit quality of, and continued performance by, suppliers and customers. At times, we rely on a single customer or a few customers to purchase all or a significant portion of a facility's output, in some cases under long-term agreements that account for a substantial percentage of the anticipated revenue from a given facility.”

Annual report 2025A · The company itself

“Key performance drivers for utilities include the regulated rate of return and tariff, seasonality, weather variations, economic activity, and reliability of service.”

Annual report 2025A · The company itself

“Retail sales, after adjustments for weather variations, are also affected by changes in local economic activity, energy efficiency and distributed generation initiatives, as well as the number of retail customers.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •changes in hydrology, which impacts the spot prices and exposes the business to variability in the cost of replacement power; •fluctuations in commodity prices, mainly fuel oil and natural gas, which affect the cost of thermal generation and spot prices; •constraints imposed by the capacity of transmission lines connecting the west side of the country with the load, keeping surplus power trapped during the rainy season; and •country demand, as GDP growth is expected to remain strong over the short and medium term.”

Annual report 2025A · The company itself

“56 | 2025 Annual Report Further, the Chinese market has driven global materials demand and pricing for commodities, many of which are produced in our key electricity markets in South America. Volatility in economic growth in China could result in lower economic growth and lower demand for electricity in our key markets.”

Annual report 2025A · The company itself

“We have also located our plants in different geographic areas in order to mitigate the effects of regional economic downturns; however, there can be no assurance that our efforts will be effective.”

Annual report 2025A · The company itself

“Customer growth and customer usage in our utilities businesses are affected by external factors, including mandated energy efficiency measures, demand side management requirements, and economic and demographic conditions, such as population changes, job and income growth, housing starts, new business formation and the overall level of economic activity.”

Annual report 2025A · The company itself

“Increased market participation may have the effect of lowering our operating margins. Among other steps, FERC has encouraged RTOs and ISOs to develop demand response bidding programs as a mechanism for responding to peak electric demand and has also encouraged the integration of distributed energy resources.”

Annual report 2025A · The company itself

“Colombia Electricity supply in Colombia is concentrated in one main system, the SIN, which encompasses one-third of Colombia's territory and provides electricity to 99% of the country's population. As of December 31, 2025, the SIN's installed capacity was 21,040 MW, composed of hydroelectric (63%), thermal (30%), and other renewables (7%) generation. The marked seasonal variations in Colombia's hydrology result in price volatility in the short-term market.”

Annual report 2025A · The company itself

“56 | 2025 Annual Report Further, the Chinese market has driven global materials demand and pricing for commodities, many of which are produced in our key electricity markets in South America. Volatility in economic growth in China could result in lower economic growth and lower demand for electricity in our key markets.”

Annual report 2025A · The company itself

“At the end of 2023, AES Colombia obtained the environmental license, issued by the ANLA, for the 500 kV line to connect the Guajira pipeline projects. Currently, AES Colombia has obtained environmental licenses for 406 MW of wind projects in Guajira.”

Annual report 2025A · The company itself

“AES Chile Business Description — AES Chile is engaged in the generation and supply of electricity (energy and capacity) in the SEN—see Energy Markets and Regulatory Environment below— through AES Andes, AES Pacifico Chile, and their subsidiaries. In total, AES operates 2,195 MW of renewable installed capacity in Chile, excluding energy storage, and has a market share of approximately 6% as of December 31, 2025.”

Annual report 2025A · The company itself

“AES Colombia Business Description — We operate in Colombia through AES Colombia, a subsidiary of AES Andes, which owns Chivor, a hydroelectric plant with an installed capacity of 1,000 MW and Tunjita, a 20 MW run-of-river hydroelectric plant, both located approximately 100 miles east of Bogota, as well as the Castilla, Brisas, and San Fernando solar facilities with capacity of 21 MW, 26 MW, and 61 MW, respectively.”

Annual report 2025A · The company itself

“AES Dominicana Business Description — AES has a strategic partnership with the Estrella and Linda Groups ("Estrella-Linda"), two leading Dominican industrial groups that manage a diversified business portfolio, and with AFI Popular, a subsidiary of Grupo Popular. AES' ownership interest in AES Dominicana is 65%.”

Annual report 2025A · The company itself

“In the Utilities segment, AES operates four utilities in El Salvador with installed operating capacity of 143 MW, as well as an integrated utility in Indiana, with installed operating capacity of 4,056 MW.”

Annual report 2025A · The company itself

“Colon LNG Marketing continues developing the LNG market in Latin America, with clients already established in Panama and Colombia. Additional efforts are being undertaken in Costa Rica, other Central America regions, and Caribbean islands, mainly focusing on small scale LNG logistics.”

Annual report 2025A · The company itself

“This segment comprises generation facilities using natural gas, LNG, coal, pet coke, diesel, and/or oil, in nine countries — Vietnam, the United States, Argentina, Chile, Bulgaria, Mexico, Jordan, Panama, and the Dominican Republic.”

Annual report 2025A · The company itself

“AES Argentina and TermoAndes Business Description — AES operates plants in Argentina within the Energy Infrastructure SBU totaling 2,814 MW, representing 6% of the country's total installed capacity.”

Annual report 2025A · The company itself

“AES Chile Business Description — In Chile, AES owns and operates Cochrane and Angamos, two coal-fired power plants with a total combined installed capacity of 1,108 MW, representing a market share of approximately 3% as of December 31, 2025.”

Annual report 2025A · The company itself

“AES Panama Business Description — In Panama, AES owns and operates Colon, a 381 MW combined cycle power plant fueled by natural gas. In partnership with InterEnergy, AES also entered into a joint venture to build and operate the Gatun facility, a 670 MW combined cycle gas power plant.”

Annual report 2025A · The company itself

“With a total of 679 MW of installed thermal capacity, AES provides 9% of the country's capacity and supplies approximately 16% of the country's energy demand via these generation facilities.”

Annual report 2025A · The company itself

“Our businesses require reliable transportation sources (including related infrastructure such as roads, ports, and rail), power sources and water sources to access and conduct operations. The availability and cost of this infrastructure affects capital and operating costs and levels of production and sales.”

Annual report 2025A · The company itself

“On March 4, 2020, the IURC issued an order approving the projects in AES Indiana's seven-year TDSIC Plan for eligible transmission, distribution, and storage system improvements totaling $1.2 billion from 2020 through 2026.”

Annual report 2025A · The company itself

“Smart Grid Comprehensive Settlement — On October 23, 2020, AES Ohio entered into a Stipulation and Recommendation (the Settlement) with the staff of the PUCO, various customers and organizations representing customers of AES Ohio and certain other parties with respect to, among other matters, AES Ohio's applications for (i) approval of AES Ohio's plan to modernize its distribution grid (Smart Grid Phase 1), (ii) findings that AES Ohio passed the SEET for 2018 and 2019, and (iii) findings that AES Ohio's ESP 1 satisfies the SEET and the more favorable in the aggregate (MFA) regulatory test.”

Annual report 2025A · The company itself

“The investments reflected in this distribution rate case include investments to enhance the safety, reliability, and resilience of the distribution system.”

Annual report 2025A · The company itself

“This plan describes the investments necessary to strengthen and modernize AES Ohio's infrastructure and expand support for its customers.”

Annual report 2025A · The company itself

“AES primarily sells its energy in the wholesale electricity market where prices are largely regulated. In 2025, approximately 70% of the energy sold was produced by the hydroelectric power plants and sold in the wholesale electricity market and the remaining 30% was generated by the wind power plants.”

Annual report 2025A · The company itself

“AES Panama Business Description — AES owns and operates five hydroelectric plants totaling 705 MW of generation capacity, a wind farm of 55 MW, and eight solar plants totaling 77 MW, which collectively represent 16% of the total installed capacity in Panama.”

Annual report 2025A · The company itself

“AES Bulgaria Business Description — AES owns an 89% economic interest in the St. Nikola wind farm ("Kavarna"), which has 156 MW of installed capacity. The power output of St. Nikola is sold to customers operating on the liberalized electricity market.”

Annual report 2025A · The company itself

“AES Bulgaria Business Description — Our AES Maritza plant is a 690 MW lignite fuel thermal power plant.”

Annual report 2025A · The company itself

“The expansion of advanced manufacturing and data centers has the potential to significantly accelerate the demand for electricity in the U.S. power markets. AES Indiana and AES Ohio have an obligation to serve customers who are located in our service territory and are working with several companies to provide solutions for the electric service needs of data centers and advanced manufacturing facilities. We see these relationships growing with the expansion of their use within our service territory.”

Annual report 2025A · The company itself

“Cochrane currently has long-term contracts with an average remaining term of approximately 10 years with mining customers, mainly with pricing indexed to CPI.”

Annual report 2025A · The company itself

“AES Mexico Business Description — The TEG and TEP pet coke-fired plants, located in Tamuin, San Luis Potosi, supply power to their offtakers under long-term PPAs expiring in 2027 with a 90% availability guarantee.”

Annual report 2025A · The company itself

“Private companies operate in all three segments, and generators can enter into PPAs to sell energy to regulated and unregulated customers, as well as to other generators in the spot market.”

Annual report 2025A · The company itself

“We are very well-positioned as a leading provider of renewable energy to data center companies, particularly in the U.S., and to large mining companies outside the U.S.”

Annual report 2025A · The company itself

“AES Andes currently has long-term contracts with an average remaining term of approximately 14 years with unregulated customers, such as mining and industrial companies, mainly with pricing indexed to CPI.”

Annual report 2025A · The company itself

“Development Strategy — In Chile, AES is building wind, solar, and storage to supply AES Andes' agreements with its main mining customers. In total, the pipeline in Chile currently includes 5.5 GW under development at 18 | 2025 Annual Report different stages and geographical locations.”

Annual report 2025A · The company itself

“AES Colombia’s installed capacity accounted for approximately 5% of system capacity at the end of 2025.”

Annual report 2025A · The company itself

“The inability to obtain replacement equipment or parts, due to disruption of the supply chain or other factors, may impact the ability of our plants to perform. Breakdown or failure of one of our operating facilities may prevent the facility from performing under applicable power sales agreements which, in certain situations, could result in termination of a power purchase or other agreement or incurrence of a liability for liquidated damages and/or other penalties.”

Annual report 2025A · The company itself

“We may incur significant expenditures to adapt our businesses to technological changes. Emerging technologies may be superior to, or may not be compatible with, some of our existing technologies, investments and infrastructure, and may require us to make significant expenditures to remain competitive, or may result in the obsolescence of certain of our operating assets.”

Annual report 2025A · The company itself

“Maximo Business Description — Maximo is an AI-enabled robot that enhances solar module installation speed, efficiency, and safety. Maximo enhances the safety and scalability of solar installation by automating the heavy lifting for placing and attaching solar modules.”

Annual report 2025A · The company itself

“Commencing on January 1, 2024, the Southland OTC units are contracted through Standby Capacity Purchase Agreements with the California Department of Water Resources (“California DWR”), an agency of the State of California, as part of the Electricity Supply Strategic Reliability Reserve Program (“Strategic Reserve”) established under California Assembly Bill 205. Under these agreements, California DWR is purchasing each facility’s available capacity for a three-year term.”

Annual report 2025A · The company itself

“This plant is fully contracted through a long-term PPA with PREPA expiring in 2027.”

Annual report 2025A · The company itself

“Merida is a CCGT located on Mexico's Yucatan Peninsula that sold power to CFE under a PPA until December 8, 2025, when the plant successfully migrated to the Wholesale Electricity Market ("WHEM") under the new Electricity Sector Law ("LESE").”

Annual report 2025A · The company itself

“In these instances, we rely on power sales contracts with one or a limited number of customers for the majority of, and in some cases all of, the relevant plant's output and revenues over the term of the power sales contract.”

Annual report 2025A · The company itself

“Acquisitions have been a significant part of our growth strategy historically and more recently as we grow our renewables business.”

Annual report 2025A · The company itself

“Cochrane currently has long-term contracts with an average remaining term of approximately 10 years with mining customers, mainly with pricing indexed to CPI.”

Annual report 2025A · The company itself

“Our non-utility, generation subsidiaries seek to pass on any costs arising from CO2 emissions to contract counterparties. Likewise, our utility subsidiaries seek to pass on any costs arising from CO2 emissions to customers.”

Annual report 2025A · The company itself

“Electromobility is also being promoted by AES Soluciones through a partnership with Blink Charger in order to design and deploy a private network of electric chargers throughout the country.”

Annual report 2025A · The company itself

“In 2025, we signed long-term contracts for 4.0 GW of renewables, bringing our backlog of projects — those with signed contracts, but which are not yet in operation — to 12.0 GW. Our backlog serves as one of the core components of our future growth.”

Annual report 2025A · The company itself

“29 | 2025 Annual Report Energy Infrastructure Our Energy Infrastructure SBU aims to provide energy security to enable the integration of new renewables and maximize the value of our gas generation and LNG business through flexible operations that support the energy transition.”

Annual report 2025A · The company itself

“AES El Salvador owns and operates four solar farms: Opico Power, Moncagua, and Metapan with 4 MW, 3 MW, and 15 MW of capacity, respectively, and Meanguera del Golfo, a solar and battery storage facility with 1 MW capacity; as well as AES Nejapa, a biomass power plant with 6 MW capacity; and 50% of Bosforo and Cuscatlan, solar farms with 100 MW and 10 MW capacity, respectively.”

Annual report 2025A · The company itself

“In particular, in the U.S., AES’ renewable energy generation growth strategy has depended in part on federal, state, and local government policies and incentives that support the development, financing, ownership, and operation of renewable energy generation projects, including investment tax credits, production tax credits, accelerated depreciation, renewable portfolio standards, feed-in-tariffs, and similar programs, REC mechanisms and compliance programs, and tax exemptions. More recently, the favorable regulatory regimes associated with the U.S. Inflation Reduction Act of 2022 have been curtailed by the passage of H.R.”

Annual report 2025A · The company itself

“Regulated Rate of Return and Tariff — In exchange for the right to sell or distribute electricity in a service territory, our utility businesses are subject to government regulation. This regulation sets the framework for the prices ("tariffs") that our utilities are allowed to charge customers for electricity and establishes service standards that we are required to meet. Our utilities are generally permitted to earn a regulated rate of return on assets, determined by the regulator based on the utility's allowed regulatory asset base, capital structure, and cost of capital.”

Annual report 2025A · The company itself

“The regulatory authority of the IURC over AES Indiana's business is typical of regulation generally imposed by state public utility commissions. The IURC sets tariff rates for electric service provided by AES Indiana. The IURC considers all allowable costs for ratemaking purposes, including a fair return on assets used and useful to providing service to customers.”

Annual report 2025A · The company itself

“Regulatory Framework and Market Structure — AES Ohio is regulated by the PUCO for its distribution services and facilities, retail rates and charges, reliability of service, compliance with renewable energy portfolio requirements, energy efficiency program requirements, and certain other matters.”

Annual report 2025A · The company itself

“Among other items, the PUCO Order approving the ESP 1 rate plan included reinstating the non-bypassable RSC Rider, which provided annual revenue of approximately $79.0 million. The OCC has appealed to the Ohio Supreme Court the PUCO’s decision approving the reversion to ESP 1 as well as argued for a refund of the RSC revenue dating back to August 2021.”

Annual report 2025A · The company itself

“A fundamental premise of the Application was the continued availability of rider recovery of Smart Grid investments through the plan period. However, with the recent enactment of House Bill 15 described above, which prohibits AES Ohio from applying for a new electric security plan which includes certain rider recovery mechanisms, as well as the near-term financial uncertainty created by the statute, AES Ohio withdrew its Smart Grid Phase 2 Application on May 23, 2025.”

Annual report 2025A · The company itself

“Maritza is contracted under a 15-year PPA that expires in May 2026.”

Annual report 2025A · The company itself

“•The Superintendence of Electricity's main responsibilities include monitoring compliance with legal provisions, rules, and technical procedures governing generation, transmission, distribution, and commercialization of electricity. They monitor behavior in the electricity market in order to prevent monopolistic practices. In addition to the two agencies responsible for monitoring compliance with the General Electricity Law, the Ministry of Industry and Commerce supervises commercial and industrial activities in the Dominican Republic as well as the fuels and natural gas commercialization to end users.”

Annual report 2025A · The company itself

“AES El Salvador distribution rates are regulated by the General Superintendence of Electricity and Telecommunications and are established through a traditional cost-based rate-setting process. AES El Salvador is permitted to recover its costs of providing distribution services as well as earn a regulated rate of return on assets, determined by the regulator, based on the utility's allowed regulated asset base, capital structure, and cost of capital.”

Annual report 2025A · The company itself

“Bulgaria The electricity sector in Bulgaria is regulated by the Bulgarian Energy Act. The Bulgarian electricity market allows both regulated and competitive segments.”

Annual report 2025A · The company itself

“Mexico’s new Electricity Sector Law (LSE) and its Regulations (RLSE), enacted in 2025, replaced the previous framework to centralize control under the state-owned CFE. The reform reinforces the State’s leading role in the electricity industry, preserving transmission and distribution as exclusive state services, while redefining the conditions for private participation in generation and commercialization.”

Annual report 2025A · The company itself

“In addition to the Ministry of Energy, three main agencies are responsible for regulating market agents and their activities, monitoring compliance with laws and regulations, and surveillance of operational compliance and management of the wholesale electricity market: •The Energy Regulatory Commission is responsible for the establishment of directives, orders, methodologies, and standards to regulate the electric and fuel markets, as well as granting permits. •The National Center for Energy Control, as an ISO, is responsible for managing the wholesale electricity market, transmission and distribution infrastructure, planning network developments, guaranteeing open access to network infrastructure, executing competitive mechanisms to cover regulated demand, and setting transmission charges. •The Electricity Federal Commission ("CFE") owns the transmission and distribution grids and is also the country's basic supplier. CFE is the offtaker for IPP generators, and together with its own power units has more than 50% of the current generation market share.”

Annual report 2025A · The company itself

“The regulatory landscape underwent a significant transformation with SE Resolution 400/25, effective November 2025, which instituted new rules for the wholesale energy market and its progressive adaptation. The new remuneration framework requires generators to manage their fuel supply and declare their variable production cost based on established reference values, while allowing the contracting of energy and/or capacity based on bilaterally negotiated terms.”

Annual report 2025A · The company itself

“At the end of November 2024, a new electricity law was passed by the National Assembly. The new law provides for a comprehensive reform of the legal framework in the power and energy sector of Vietnam after two decades under the current electricity law of 2004. It provides an improved legal environment for the energy sector, including but not limited to imported LNG power, green hydrogen and ammonia, offshore wind, nuclear power, low-emission conversion, emergency power projects, minimum long-term contracted electricity output, DPPA, and a fuel cost pass-through mechanism.”

Annual report 2025A · The company itself

“Seasonality, Weather Variations, and Economic Activity — Our utility businesses are generally affected by seasonal weather patterns and, therefore, operating margin is not generated evenly throughout the year. Additionally, weather variations may also have an impact based on the number of customers, temperature variances from normal conditions, and customers' historic usage levels and patterns.”

Annual report 2025A · The company itself

“Key Financial Drivers — Hydrological conditions largely influence Chivor's power generation. Maintaining the appropriate contract level, while maximizing revenue through the sale of excess generation, is key to AES Colombia's results of operations.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •contracting levels, providing additional benefits from improved operational performance, including performance incentives and/or excess energy sales; •changes in the methodology to calculate spot energy prices or Locational Marginal Prices, which impacts the excess energy sales; •improved operational performance and plant availability; and •changes in wind resources.”

Annual report 2025A · The company itself

“Key Financial Drivers — AES Indiana's financial results are driven primarily by retail demand, weather, and maintenance costs.”

Annual report 2025A · The company itself

“Key Financial Drivers — AES Ohio's financial results are driven primarily by retail demand and weather.”

Annual report 2025A · The company itself

“Hydrological conditions impact reservoir water levels and largely influence the dispatch of the system's hydroelectric and thermoelectric generation plants and, therefore, influence market costs. Precipitation in Argentina occurs principally from May to October.”

Annual report 2025A · The company itself

“Furthermore, production levels for our wind and solar projects may be dependent upon adequate wind or sunlight resulting in volatility in production levels and profitability.”

Annual report 2025A · The company itself

“Volatility in market prices for fuel and electricity may result from, among other things: •plant availability in the markets generally; •availability and effectiveness of transmission facilities owned and operated by third parties; •competition and new entrants; •seasonality, hydrology, and other weather conditions; •illiquid markets; •transmission, transportation constraints, inefficiencies, and/or availability; •renewables source contribution to the supply stack; •increased adoption of distributed generation; •energy efficiency and demand side resources; •available supplies of coal, natural gas, and crude oil and refined products; •generating unit performance; •natural disasters, terrorism, wars, embargoes, pandemics, and other catastrophic events; •energy, market and environmental regulation, legislation, and policies; •general economic conditions that impact demand and energy consumption; and •bidding behavior and market bidding rules.”

Annual report 2025A · The company itself

“Certain of our businesses are sensitive to variations in weather and hydrology. Our businesses are affected by variations in general weather patterns and unusually severe weather.”

Annual report 2025A · The company itself

“60 | 2025 Annual Report Weather conditions directly influence the demand for electricity and natural gas and other fuels and affect the price of energy and energy-related commodities. In addition, severe weather and natural disasters, such as hurricanes, floods, tornadoes, icing events, earthquakes, dam failures, wildfires and tsunamis can be destructive and could prevent us from operating our business in the normal course by causing power outages and property damage, reducing revenue, affecting the availability of fuel and water, causing injuries and loss of life, and requiring us to incur additional costs, for example, to restore service and repair damaged facilities, to obtain replacement power and to access available financing sources.”

Annual report 2025A · The company itself

“Our power plants could be placed at greater risk of damage should changes in the global climate produce unusual variations in temperature and weather patterns, resulting in more intense, frequent and extreme weather events, including heatwaves, fewer cold temperature extremes, abnormal levels of precipitation resulting in river and coastal urban floods in North America or reduced water availability and increased flooding across Central and South America, and changes in coast lines due to sea level change.”

Annual report 2025A · The company itself

“Furthermore, according to the Intergovernmental Panel on Climate Change, physical risks from climate change could include, but are not limited to, increased runoff and earlier spring peak discharge in many glacier and snow-fed rivers, warming of lakes and rivers, an increase in sea level, and changes and variability in precipitation and in the intensity and frequency of extreme weather events.”

Annual report 2025A · The company itself

“Several of our businesses are subject to potentially significant remediation expenses, enforcement initiatives, private party lawsuits, and reputational risk associated with CCR. CCR generated at our current and former coal-fired generation plant sites, is currently handled and/or has been handled by: placement in onsite CCR ponds; disposal and beneficial use in onsite and offsite permitted, engineered landfills; use in various beneficial use applications, including encapsulated uses and structural fill; and used in permitted offsite mine reclamation.”

Annual report 2025A · The company itself

“We may be unable to develop our renewables platform as quickly as anticipated. Further, we may be unable to dispose of coal-fired generation assets at anticipated prices, the estimated useful lives of these assets may decrease, and the value of such assets may be impaired.”

Annual report 2025A · The company itself

“Commodity Price Risk AES generally seeks to hedge its exposure to commodity price risk; however, certain generation businesses may retain limited unhedged positions due to short‑term sales structures or contractual mismatches between supply and obligations. As a result, a portion of operating results may be exposed to changes in market prices for electricity, fuels, and environmental credits.”

Annual report 2025A · The company itself

“15% of the capacity of our generation fleet is coal-fired.”

Annual report 2025A · The company itself

“The open market wholesale prices for electricity can be volatile and generally reflect the variable cost of the source generation which could include renewable sources at near zero pricing or thermal sources subject to fluctuating cost of fuels such as coal, natural gas, or oil derivative fuels in addition to other factors described below. Consequently, any changes in the generation supply stack and cost of coal, natural gas, or oil derivative fuels may impact the open market wholesale price of electricity.”

Annual report 2025A · The company itself

“In many cases, we also limit our exposure to fluctuations in fuel prices by entering into long-term contracts for fuel with a limited number of suppliers.”

Annual report 2025A · The company itself

“A significant portion of our PPAs through 2025 include mechanisms of indexation that adjust the price of energy based on fluctuations in the price of coal, with an index defined by the National Energy Commission based on the physical coal imports for the energy system. This mechanism mitigates exposures to changes in the price of fuel.”

Annual report 2025A · The company itself

“Among other matters and consistent with the Stipulation and Settlement Agreement, the 2024 Base Rate Order approves an increase in AES Indiana's total annual operating revenue of $71 million for AES Indiana’s electric service and provides a return on common equity of 9.9% and cost of long-term debt of 4.9% on a rate base of approximately $3.5 billion.”

Annual report 2025A · The company itself

“AES Ohio is permitted to recover its costs of providing distribution service as well as earn a regulated rate of return on assets, determined by the regulator, based on the utility's allowed regulated asset base, capital structure, and cost of capital.”

Annual report 2025A · The company itself

“As a result, fluctuating commodity prices or interest rates may negatively impact our financial results to the extent we have unhedged or inadequately hedged positions.”

Annual report 2025A · The company itself

“A substantial portion of cash flow from operations must be used to make payments on our debt. Furthermore, since a significant percentage of our assets are used to secure this debt, this reduces the amount of collateral available for future secured debt or credit support and reduces our flexibility in operating these secured assets.”

Annual report 2025A · The company itself

“As of December 31, 2025, a hypothetical 100‑basis‑point increase in interest rates would be expected to increase annual pre‑tax interest expense by less than $10 million, based on the portion of the Company's debt that is subject to variable interest rates.”

Annual report 2025A · The company itself

“The factors leading to AES Indiana's base rate increase request include inflationary impacts on O&M expenses and continued investments in generation, transmission, and distribution assets. AES Indiana is also seeking recovery of increased costs to support its vegetation management plan, storm restoration costs, and technology to enhance resiliency and reliability.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •operational performance; •regulatory outcomes and impacts; •variability in energy demand driven by weather; and •the impact of fuel oil prices on energy tariff prices, which affect cash flow due to a three-month delay in the pass-through of energy costs to the tariffs charged to customers.”

Annual report 2025A · The company itself

“In 2024 and 2025, the Argentine peso devalued against the USD by approximately 22% and 29%, respectively, and Argentina’s economy continued to be highly inflationary.”

Annual report 2025A · The company itself

“We may not be adequately hedged against our exposure to changes in commodity prices or interest rates. We routinely enter into contracts to hedge a portion of our purchase and sale commitments for electricity, fuel requirements, and other commodities to lower our financial exposure related to commodity price fluctuations.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •operational performance; •regulatory outcomes and impacts; •variability in energy demand driven by weather; and •the impact of fuel oil prices on energy tariff prices, which affect cash flow due to a three-month delay in the pass-through of energy costs to the tariffs charged to customers.”

Annual report 2025A · The company itself

“To the extent hydrological inflows are greater than or less than the contract volumes, the business will be sensitive to changes in spot power prices which may be driven by oil and natural gas prices in some time periods.”

Annual report 2025A · The company itself

“Thermoelectric generation in the SADI is fueled primarily by natural gas. However, scarcity of natural gas during winter periods (June to August) due to transport constraints results in the use of alternative fuels, such as oil and coal.”

Annual report 2025A · The company itself

“The open market wholesale prices for electricity can be volatile and generally reflect the variable cost of the source generation which could include renewable sources at near zero pricing or thermal sources subject to fluctuating cost of fuels such as coal, natural gas, or oil derivative fuels in addition to other factors described below. Consequently, any changes in the generation supply stack and cost of coal, natural gas, or oil derivative fuels may impact the open market wholesale price of electricity.”

Annual report 2025A · The company itself

“Further, our actual cash requirements may be greater than expected and our cash flows may not be sufficient to repay all of the outstanding debt as it becomes due. In that event, we may not be able to borrow money, sell assets, raise equity, or otherwise raise funds on acceptable terms to refinance our debt as it becomes due.”

Annual report 2025A · The company itself

“Our ability to grow our business depends on our ability to raise capital on favorable terms. We rely on the capital markets as a source of liquidity for capital requirements not satisfied by operating cash flows.”

Annual report 2025A · The company itself

“Mexico’s new Electricity Sector Law (LSE) and its Regulations (RLSE), enacted in 2025, replaced the previous framework to centralize control under the state-owned CFE. The reform reinforces the State’s leading role in the electricity industry, preserving transmission and distribution as exclusive state services, while redefining the conditions for private participation in generation and commercialization.”

Annual report 2025A · The company itself

“In addition, new tariffs, duties, or other assessments have been imposed on the imports of solar cells, modules, batteries, or other equipment utilized in our renewable energy projects.”

Annual report 2025A · The company itself

“In 2024 and 2025, the Argentine peso devalued against the USD by approximately 22% and 29%, respectively, and Argentina’s economy continued to be highly inflationary.”

Annual report 2025A · The company itself

“While the Consolidated Financial Statements are reported in U.S. dollars, the financial statements of several of our subsidiaries outside the U.S. are prepared using the local currency as the functional currency and translated into U.S. dollars by applying appropriate exchange rates. As a result, fluctuations in the exchange rate of the U.S. dollar relative to the local currencies where our foreign subsidiaries report could cause significant fluctuations in our results.”

Annual report 2025A · The company itself

“Cyber-attacks and data security breaches could harm our business. Our business relies on electronic systems and network technologies to operate our generation, transmission and distribution infrastructure.”

Annual report 2025A · The company itself

“Coal and natural gas are used as primary fuels. Coal prices are set by market factors internationally, while natural gas prices are generally set domestically.”

Annual report 2025A · The company itself

“In addition, financial results are likely to be driven by many factors, including, but not limited to: •spot market prices (largely impacted by dry hydrological scenarios, forced outages, and international fuel prices); •changes in current regulatory rulings, tax policies; and •fluctuations of the Chilean peso.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •forced outages; •exposure to fluctuations of the Argentine peso; •changes in hydrology and wind resources; and •domestic energy demand and exports.”

Annual report 2025A · The company itself

“In addition to hydrology, financial results are driven by many factors, including, but not limited to: •forced outages; •fluctuations of the Colombian peso; and •spot market prices.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •forced outages; •exposure to fluctuations of the Argentine peso; •timely collection of FONINVEMEM installments and outstanding receivables (see Energy Markets and Regulatory Environment below); •natural gas prices and availability for contracted generation at TermoAndes; and •domestic energy demand and exports.”

Annual report 2025A · The company itself

“However, NEK's liquidity position is subject to political conditions and regulatory changes in Bulgaria.”

Annual report 2025A · The company itself

“Volatility in market prices for fuel and electricity may result from, among other things: •plant availability in the markets generally; •availability and effectiveness of transmission facilities owned and operated by third parties; •competition and new entrants; •seasonality, hydrology, and other weather conditions; •illiquid markets; •transmission, transportation constraints, inefficiencies, and/or availability; •renewables source contribution to the supply stack; •increased adoption of distributed generation; •energy efficiency and demand side resources; •available supplies of coal, natural gas, and crude oil and refined products; •generating unit performance; •natural disasters, terrorism, wars, embargoes, pandemics, and other catastrophic events; •energy, market and environmental regulation, legislation, and policies; •general economic conditions that impact demand and energy consumption; and •bidding behavior and market bidding rules.”

Annual report 2025A · The company itself

“Our businesses require reliable transportation sources (including related infrastructure such as roads, ports, and rail), power sources and water sources to access and conduct operations. The availability and cost of this infrastructure affects capital and operating costs and levels of production and sales.”

Annual report 2025A · The company itself

“We often rely on a single contracted supplier or a small number of suppliers for the provision of fuel, transportation of fuel and other services required for the operation of some of our facilities. If these suppliers cannot perform, we would seek to meet our fuel requirements by purchasing fuel at market prices, exposing us to market price volatility and the risk that fuel and transportation may not be available during certain periods at any price, which could adversely impact the profitability of the affected business and our results of operations, and could result in a breach of agreements with other counterparties, including, without limitation, offtakers or lenders.”

Annual report 2025A · The company itself

“Retail sales, after adjustments for weather variations, are also affected by changes in local economic activity, energy efficiency and distributed generation initiatives, as well as the number of retail customers.”

Annual report 2025A · The company itself

“In particular, the availability of insurance for coal-fired generation assets has decreased as certain insurers have opted to discontinue or limit offering insurance for such assets. Certain insurers have also withdrawn from insuring hydroelectric assets.”

Annual report 2025A · The company itself

“AES Jordan Business Description — In Jordan, AES has a 36% controlling interest in a 48 MW solar plant fully contracted with the national utility under a 20-year PPA expiring in 2039. We consolidate the results of this business as we have a controlling interest.”

Annual report 2025A · The company itself

“AES El Salvador's territory covers 77% of the country and accounted for 4,744 GWh of the market energy sales during 2025.”

Annual report 2025A · The company itself

“This segment comprises generation facilities using natural gas, LNG, coal, pet coke, diesel, and/or oil, in nine countries — Vietnam, the United States, Argentina, Chile, Bulgaria, Mexico, Jordan, Panama, and the Dominican Republic.”

Annual report 2025A · The company itself

“AES Vietnam Business Description — Mong Duong 2 is a 1,242 MW gross coal-fired plant located in the Quang Ninh Province of Vietnam and was constructed under a BOT service concession agreement expiring in 2040.”

Annual report 2025A · The company itself

“Key Financial Drivers — Financial results are driven by many factors, including, but not limited to: •regulatory changes in the Bulgarian power market; •results of the DG Comp review; •availability and load factor of the operating units; and •NEK's ability to meet the payment terms of the PPA contract with Maritza.”

Annual report 2025A · The company itself