Earnings Call Transcript - CEPU Q3 2024

Operator, Operator

Good morning, ladies and gentlemen. Welcome to Central Puerto's Third Quarter of 2024 Earnings Conference Call. A slide presentation is accompanying today's webcast and is also available on the Investors section of the company's website at www.centralpuerto.com/en/investors. All participants will be in listen-only mode during the presentation. After that, there will be an opportunity to ask questions. Please note this event is being recorded. If you do not have a copy of the press release, please refer to the Investor Relations Support section on the company's corporate website. In addition, a replay of today's call may be accessed by accessing the webcast link at the same section of Central Puerto's website. Before we proceed, please be aware that all financial figures were prepared in accordance with IFRS and were converted from Argentine pesos to US dollars for comparison purposes only. The exchange rate used to convert Argentine pesos to US dollars was the reference exchange rate reported by the Central Bank for US dollars at the end of each period. The information presented in US dollars is for the comparison of the readers only, and you should not consider these translations to be representations that the Argentine pesos amounts actually represent these US dollars amounts or could be converted into US dollars at the rate indicated. Finally, it's worth noting that the financial statements for the third quarter ended on September 30, 2024, include the effects of the inflation adjustment. Also, please take into consideration that certain statements made by the company during this conference call and answers to your questions may include forward-looking statements which are subject to risks and uncertainties that could cause actual results to differ materially from the expectations contemplated by industry remarks. Thus, we refer you to the forward-looking statements section of our earnings release and recent filings with the SEC. Central Puerto assumes no obligation to update forward-looking statements except as required under applicable securities laws. To follow the discussion better, please download the webcast presentation available on the company's website. Please be aware that some of the numbers mentioned during the call may be rounded to simplify the discussion. On the call today from Central Puerto is Fernando Bonnet, Chief Executive Officer; Enrique Terraneo, Chief Financial Officer; and Alejandro Diaz Lopez, Corporate Finance and Investor Relations. And now I will turn the call over to Alejandro Diaz Lopez. Please, Alejandro, you may begin.

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Thank you very much and good morning everybody. Thank you for joining us today on a new session of earnings presentation where we are going to discuss our financial results of the third quarter of 2024. Before we get started, I would like to take a moment to review today's agenda. I will begin the presentation by addressing shortly the main figures of the third quarter of 2024, followed by a quick update of the regulatory framework and relevant news. Then I will show an overview of the Argentine electricity industry, moving afterwards to our operational and financial results. Finally, at the end of the presentation, we will be happy to address any questions you may have. Before going into a more exhaustive analysis of our financial and operational results, let me briefly review Central Puerto's main figures for the third quarter of 2024. The group's installed capacity is 6,703 megawatts and energy generation amounted to 5,685 gigawatt hours during the third quarter of 2024, decreasing 1% year-over-year. Regarding our financial results, it should be noted that due to Central Puerto's accounting methodology, all items in pesos must be inflation-adjusted to the end of the quarter or local currency. While the company reports its results in dollars by converting them at the end of the period official exchange rate, the so-called Central Bank A 3500 exchange rate, this causes a non-cash impact that affects positively or negatively as appropriate our financial metrics. Revenues for the third quarter of 2024 amounted to US$185 million increasing 14% year-over-year compared to the third quarter of 2023 results, while adjusted EBITDA reached US$93 million raising almost 1% versus the third quarter of 2023. Net income for the period was positive in US$40 million doubling year-over-year. Finally, after debt consolidation as a result of M&A operations, loan repayments, and dividend payments, net debt as of September 30, 2024, amounted to US$149 million, a reduction of US$137 million compared to December of 2023, showcasing a net debt to adjusted EBITDA ratio of 0.5 times. Now, let's move to the most recent regulatory updates and news. We have anticipated in our last call the cancellation of the thermal generation tender called Terconf by means of Resolution 151 issued by the Secretary of Energy on July 8. After the price adjustment established last June through Resolution 99, we were granted a 3% increase in August with Resolution 193, a 5% increase in September with Resolution 233, and a 3% increase in October with Resolution 285. Please take into account that this last resolution has no impact on the third quarter of 2024 figures. Resolution 294 deserves a special mention. It established a contingency plan for the electricity industry with the aim to mitigate possible critical situations during the period December 2024 to March 2026 with action plans for generation, transmission, and distribution as well as for major demand. Regarding generation, an additional complementary and exceptional remuneration for power and energy is established with the purpose of ensuring the availability of equipment in critical months and hours. The scheme is for thermal power plants located in critical nodes determined in Annex 1 of the said resolution that do not have PPAs nor have adhered to Resolution 59. As you remember, this was established for combined cycles. This exceptional compensation will be in place for summer periods December, January, February, and March between 12:00 PM and 10:00 PM and winter periods, June, July, and August between 6:00 PM and 11:00 PM. To get the additional remuneration, a generator must declare a committed power. The remuneration for both energy and power is affected by the node criticality factor, which can vary between 0.75 and 1.25. To determine the power remuneration, it is also considered the real availability of the generation unit, which is measured during the aforementioned month and hour. Central Puerto's eligible units to adhere to this resolution include steam turbines located in Buenos Aires and Lujan de Cuyo, gas turbines located in Lujan de Cuyo, as well as the Brigadier Lopez thermal power plant. For Central Puerto, the additional remuneration for power varies from US$2,000 to US$2,500 depending on month and units considered. Finally, some key points of the contingency plan include a preventive scheme with backup transformers and mobile generating units in critical nodes. Also, a demand management system is implemented for certain time slots; major users with a declared maximum requirement greater than 10 megawatts may propose a reduction in their loads. Continuing with news and regulatory updates, you should take into account that a new adjustment in spot remuneration was determined by means of Resolution 20 establishing a 6% rise since November 1st. As with Resolution 285 recently mentioned, this has also no impact on the third quarter of 2024 figures. Regarding the situation of Piedra del Aguila hydro operation, the concession was extended for one year by means of presidential decree number 718 issued on August 12th. This decree also set forth a national and international public tender for 2025 looking to grant a new 30-year concession for Comahue hydroelectric plants. The last thing to be mentioned, a couple of days ago the Board of Directors decided to pay dividends distributing ARS39.47 per share. Finally, a concluding remark regarding the investment projects currently in execution, I mean the San Carlos solar farm and the Brigadier Lopez combined cycle. Both projects are on schedule and on budget. Work on both projects is progressing as planned and at a good pace without setbacks. The solar farm is expected to be completed by the second quarter of 2025, whereas the combined cycle COD is planned for the fourth quarter of 2025. Now let's skip to the Argentine electricity market picture of this quarter that will be shown on slides 7 and 8. By the end of the third quarter of 2024, the country's installed capacity reached 42,919 megawatts, which means a decrease of 1% or 533 megawatts compared to the 43,452 megawatts recorded as of September 30th of 2023. The variation results from the installation of new power facilities and adjustments and repowering of power plants that were already in operation. The contraction of 533 megawatts is composed as follows: First, an addition of 902 megawatts of renewable sources of which 622 megawatts corresponds to wind farms including 271 megawatts of new plants installed during the third quarter of 2024; 273 megawatts to solar plants including 76 megawatts of new capacity installed during the third quarter of 2024 and 8 megawatts to biogas power plants. Then we have a reduction of 1,195 megawatts in hydro sources and finally a net decrease of 240 megawatts in thermal sources where a reduction of 295 megawatts corresponds to gas turbines, a contraction of 470 megawatts corresponds to steam turbines, and a shrink of 99 megawatts to diesel engines being all partially offset by a rise of 624 megawatts in combined cycles. It is worth highlighting that the decline of 1,195 megawatts in hydro installed capacity is basically explained by a reassessment of Yacyreta's power available between Argentina and Paraguay. Since August of 2024, 50% of Yacyreta's installed capacity is allocated to Argentina, whereas it used to be approximately 88% before then. Generation shrank 3% during the third quarter of this year on a year-over-year basis. The decrease was driven mainly by hydro generation that shrank 33% due to a combination of two factors: one, the set change in the allocation of Yacyreta's installed capacity between Argentina and Paraguay, and a reduction of river flows. A contraction of 60% was recorded in Neuquen River, a 55% in the Collon Cura River, a 38% in the Limay River, a 26% in the Uruguay River, and finally, a contraction of 22% in the Parana River. Nuclear generation rose 7% basically as a result of higher availability and generation of Atucha II. As a result of the re-incorporation of this power plant which was in maintenance shutdown during the first half of 2023. This performance was partially offset by Embalse Power Plant, which entered into maintenance shutdown in September of 2024 and resumed operations last October. Given the low hydro generation and the moderate supply of nuclear and renewable sources, a higher thermal dispatch was required to cover the electricity demand. The 13% growth in thermal generation led to higher fuel consumption, a 16% rise in diesel consumption, a 9% rise in natural gas consumption, and a 3% increase for fuel oil. Focusing now on the demand, as you can see, electricity demand increased 1% to 35.6 terawatt hours compared to 35.2 terawatt hours recorded during the third quarter of 2023; which is basically explained by a rise in residential consumption due to weather conditions. Colder temperatures during July and August of 2024 vis-a-vis the same months of 2023 prompted higher retail consumption which then contracted in September as a result of milder temperatures compared to the equivalent months of 2023. For the whole third quarter of 2024, residential consumption rose 3%. With regards to industrial demand, slightly higher consumption was recorded for the first time in many quarters, especially for food and beverage. It remains to be seen if this represents a strong trend for the upcoming months. The figures are similar to residential patterns, showing a positive year-over-year growth rate during July and August, then decreasing in September. Finally, the electricity trade balance resulted in a net import situation during the whole quarter with a peak in August. We now go to slide 9 to our key operating indicators for the quarter. We can see that electricity generated by Central Puerto diminished 1% to 5,685 gigawatt hours compared to 5,721 gigawatt hours in the third quarter of 2023. Hydro energy generation from Piedra del Aguila dropped 35% reaching 1,405 gigawatt hours from 2,151 gigawatt hours in the third quarter of 2023. This decline was primarily due to a 55% reduction in water levels of the Collon Cura River, which resulted in lower water available for generation. Wind generation decreased 4% reaching 386 gigawatt hours in the third quarter of 2024 compared to 404 gigawatt hours in the same period of 2023. This decline is mostly explained by lower wind resources and also due to some extraordinary maintenance works, including those performed on several blades of La Castellana II. On the other hand, solar energy generation reached 61 gigawatt hours in the third quarter of 2024 as a result of the full impact of Guanizuil Solar Farm during the quarter since it was acquired in October of 2023. Thermal generation increased 21% during the third quarter of 2024 compared to the third quarter of 2023, reaching 3,832 gigawatt hours from 3,166 gigawatt hours recorded during the third quarter of 2023. The growth was mainly due to the higher dispatch of some units at Puerto site and higher availability and dispatch at Costanera site. Cogeneration units in Lujan de Cuyo and Brigadier Lopez open cycle also had higher availability and dispatch. Finally, as you can see, availability figures remain strong for the whole group for the quarter both against the market average and against Central Puerto on metrics compared to the third quarter of 2023. Special mention deserves the performance of Central Costanera, whose availability figures have been improving constantly since Central Puerto took over. This is a consequence of several deep maintenance programs, changes in the operations, and efficiency gains with the merger. Now let's move to our revenues breakdown. As you can see on slide 10, this amounted to US$185 million in the quarter as compared to US$162 million in the same period of 2023. The variation in revenues is a consequence mainly of an 11% or US$9 million increase in spot market revenues driven mainly by spot remuneration increases that were higher than currency devaluation during the period under analysis. Higher thermal generation, especially in Brigadier Lopez, Puerto, and Costanera sites, higher availability of some thermal units, especially in Costanera and Brigadier Lopez; and a non-cash effect on the gap between currency devaluation and inflation. Remember that as we stated at the beginning of this presentation, this is due to the company's accounting methodology which includes the inflation adjustment mechanism and the conversion of figures into dollars using the end-of-the-period official exchange rate. Also, in the revenues variation during the period, we should mention a 12% or US$8 million increase in sales under contract, mostly driven by the solar farm acquired in October of last year, higher availability and energy sales of cogeneration units, Lujan de Cuyo and San Lorenzo plants; and the so-called non-cash effect on the gap between currency devaluation and inflation. This was all partially offset by lower wind generation, mainly due to the extraordinary maintenance in some blades of La Castellana II as we previously mentioned. Finally, we have a 41% or US$3 million increase in steam sales driven by higher steam production in both Lujan de Cuyo and San Lorenzo facilities as a consequence of higher demand from clients in both places. We expect that steam demand will continue to be higher in the future, showing a new trend due to new economic activity levels in some industries, remarkably in oil and gas. On slide 11, we can see the dynamic of our adjusted EBITDA. During the third quarter of 2024, the group's adjusted EBITDA amounted to US$93 million, remaining almost flat when compared to the third quarter of 2023. When analyzing the adjusted EBITDA we can observe that the variation is mainly explained by the previously stated higher aggregate sales driven by spot sales and sales under contract, spot remuneration increases higher than the currency devaluation, and a positive non-cash effect on the gap between currency devaluation and inflation. Then a 24% or US$17 million increase in costs of sales explained basically by insurance and compensation to employees being both mostly explained by the real appreciation of the Argentine peso. On the other hand, production costs were also negatively impacted by a non-cash effect on the gap between currency devaluation and inflation. SG&A rose 20% or US$3 million mainly by fees and compensation for services related to one-time projects and compensation to employees being both mostly impacted by the real appreciation of the Argentine peso. Similar to production costs, SG&A were also negatively impacted by a non-cash effect due to the gap between currency devaluation and inflation. Finally, other operating results net in the third quarter of 2024 were lower than the third quarter of 2023 figures by 23% or US$3 million basically as a consequence of lower interest from clients due to lower CAMMESA delays and lower positive FX difference. Also, other operating results net were negatively impacted by a non-cash effect on the gap between currency devaluation and inflation. Moving to the next slide, the consolidated net income. During the third quarter of 2024, Central Puerto's net income amounted to US$40 million, jumping 100% or US$20 million on a year-over-year basis. The net income was positively impacted by non-cash effects including better results generated by the change in purchasing power of the currency because of lower inflation and lower D&A. These items were partially offset by lower FONI FX difference and interest. Net income was also positively impacted by the adjusted EBITDA and the net financial results which were driven by lower FX difference on financial liabilities, lower bank commissions, and a higher share of the profit of associates. Finally, income tax was higher due to higher income before tax. Lastly, on slide 13, we have the cash flow dynamic during the nine months of 2024. Net cash provided by operating activities amounted to US$184 million. This amount is mainly explained by higher income before income tax for the period, interest earned from clients, and insurance recovery being all partially offset by tax payments. Net cash used by investment activities amounted to US$119 million. This amount is mainly explained by the CapEx allocated to San Carlos and Brigadier Lopez projects and the acquisition of financial assets being all partially offset by dividends collected and the sale of financial assets. Finally, financing cash flow was negative in US$78 million. This is basically the result of long-term loan repayments and interest payments, dividends payments being all partially offset by bank and investment accounts, overdraft net, and long-term loan disbursements. Consequently, our cash position as of September 30th of 2024 amounted to US$7 million. If financial assets are included, our total current liquidity position amounts to US$245 million. With this, I conclude the presentation and now we invite you to ask any question to our team. Thank you very much for your attention.

Operator, Operator

Thank you for the presentation. We will now start the Q&A session for investors and analysts. Our first question comes from Martin Arancet from Balanz. Please go ahead, Mr. Martin, your microphone is open.

Martin Arancet, Analyst

Hi. Can you hear me?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Yes, very well.

Martin Arancet, Analyst

Okay, thanks. Thank you. Hi. Thank you for the presentation. I have three questions or topics actually that I want to discuss and if okay, I will run them one by one. The first one is regarding the new auctions for hydro assets that if I'm not mistaken, include Piedra del Aguila and they should happen by first quarter '25. But before that, I think it will be important to settle some things like the pricing, whether CAMMESA will be an intermediary, and probably some guarantees that the terms of the concessions will be fulfilled this time. So, my question there is, do you think that it can all be ready by first quarter '25? How much do you think these assets should get paid compared to the current situation? And finally, if you have any additional color or thoughts on these auctions.

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Thank you, Martin, for your interest. The government has established a 180-day period to initiate an auction for a new concession, and we have been in discussions with them. They are currently working on the new unit related to asset sales, with the Secretary of Energy overseeing the process. There is a focus on achieving the goals within the 180-day timeframe. The discussions revolve around balancing a competitive auction with attractive pricing to attract new participants, beyond just the current operators. They are considering a new scheme, possibly involving a Power Purchase Agreement with CAMMESA or addressing demand. This includes determining the conditions and pricing for the new PPA and how it will affect existing electricity prices. Currently, the price being paid for hydropower is quite low, around $13 per megawatt, which does not present an appealing option for a new auction. They are working out the details for this tender option they plan to announce next year, though no final definition is available yet. This situation encompasses not just the PPA but also the pricing of all electricity sold in the market, including thermal. They need to consider the entire tariff structure for generation and the system. However, they are optimistic that the new tender will be ready by the second quarter of next year.

Martin Arancet, Analyst

Okay, great. Well, regarding that of the, well, the regulatory change for the coal system, there are some rumors regarding a probably regulatory change that will allow thermal generation to sign private PPAs. So, I was wondering as far as you know, is the government working on a change of that sort and also were you and other thermal generators convened to discuss this change?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

The government is actively working on promoting contractualization in the electricity market, even before Daniel Gonzalez's arrival. They are considering establishing a new private market, while still maintaining existing contracts with CAMMESA. Specifically, they aim to enable contractualization between generators and major users in the spot market and to open up the current renewable energy market to thermal units. They are currently analyzing the timing for this transition, particularly regarding the thermal contracts and the fuel consumption by thermal units. Currently, CAMMESA supplies all fuels needed for generation, including gas, diesel, and fuel oil. The government is also looking into how to transition away from this supply model, allowing generators to purchase their own fuel. They are addressing both the electricity generation and fuel markets simultaneously, and this transition is considered necessary to happen sooner rather than later.

Martin Arancet, Analyst

Yeah. And regarding that, as a follow-up on that, while you mentioned that they are working on this regulatory change, but I'm guessing that probably efficient thermal units will be competitive to sign these new private PPAs, but probably more inefficient ones won't, but they are still necessary for the system. I don't know if you share that view and if you think that current legacy prices are enough for those legacy units, inefficient legacy units, or if you think that legacy prices should keep improving in order to have healthy thermal assets.

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

I believe we don't really need to distinguish between efficient and inefficient units. It's important to understand that in the electricity sector, there are two main components: energy and power. When discussing energy, efficiency is definitely a key factor. Currently, our efficient combined cycles are selling electricity at very low prices in the spot market. Compared to building new combined cycles or the auction prices from 2017 to 2019, those prices are quite low. It's essential for prices to increase slightly to sustain efficient energy over time. However, when it comes to power, we need to focus on the demand peaks, which typically rely on less efficient units like open cycle gas turbines and steam turbines that are already in place. Constructing these in the private market is challenging, as they serve as backup in times of high demand due to climate changes or specific situations. That's why system operators, like CAMMESA or those in other countries, must allocate resources for peak power and maintain the system's backup. These units often operate only about 5-10% of the time, meaning we definitely need to raise prices, as the current rates are insufficient to support new power or maintain existing operations. The prices remain unchanged from the last tender for power, which don’t reflect energy-specific needs. Power prices need to be adjusted to account for less efficient units. I think we can explore private contracts for electricity and energy, but for power, a system aggregator will be required to establish new options and prices, which should rise from current levels.

Martin Arancet, Analyst

Okay, very clear. And my final question then, while you have a strong cash position and low debt levels, I don't know what can you share regarding investment plans for the next couple of years, and if you are considering an investment under the RIGI scheme.

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

We are definitely expecting new opportunities in both power and thermal power. We've been in discussions with the government about a new tender for power, which may be smaller than last year's Terconf but will focus more specifically on certain areas in AMBA. We are prepared to participate and aim to continue replacing our units in AMBA. In the renewables sector, we're identifying opportunities, particularly by collaborating with customers to provide solutions for mining companies in the north. This includes not just supplying electricity but also building the transmission lines needed to connect to the grid. We are in talks with lithium mining companies in the north, and if the lithium sector continues to expand and we can reach agreements, we are hopeful to start constructing transmission lines and supplying the renewable energy these mining companies require. We're actively pursuing these significant projects and seeking further opportunities in the mining sector. Additionally, we are exploring entry into a silver and gold mining company and other potential ventures. We are also investigating prospects in lithium and working on developing our forest business, which presents challenges due to high logistical costs making it difficult to leverage our resources effectively in Argentina. Despite these hurdles, we are looking for ways to industrialize part of our production. Furthermore, we see opportunities in the electricity sector to enhance our renewable capacity and are evaluating internal opportunities as well.

Martin Arancet, Analyst

Great. Just one little follow-up. Do you have any timeline expected for the new auction for thermal units?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

No, in fact, but we expect, if we understand what the government is saying, not specifically days, but they want to move forward prior to the end of the year, but we don't have any specific dates or timing.

Martin Arancet, Analyst

Okay, well, pretty soon. Well, that's all on my side. Thank you very much.

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Thank you for your interest.

Operator, Operator

Our next question comes from Ludovic Casrouge from Autonomy. Please, Mr. Ludovic, your microphone is open.

Ludovic Casrouge, Analyst

Yes, good morning and congratulations for the results. My question was about the contingency plan from December 2024 to March 2026 and that you would receive higher remuneration for some plants. What could be the impact on EBITDA concretely?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

We are not anticipating a significant impact because the remuneration for the steam turbines and the gas turbine operating in an open cycle is relatively small. This situation also introduces new capital and operational expenditures for these units. Therefore, we do not expect a substantial effect on our EBITDA. It will likely be less than around US$10 million, given the short time frame and the minor portion of our generation affected, along with the fact that the increase is not significant. This action is mainly aimed at preventing further downgrading of our older units, which have faced reductions for many years, and their remuneration has reportedly been stagnant since 2019 or 2018, so it is not a large sum.

Operator, Operator

Our next question comes from Gustavo Faria from Bank of America. Please, Mr. Faria, your microphone is open.

Gustavo Faria, Analyst

Hi, guys. Thank you for taking my question. Just a quick thing on our side, do you expect any increase in the thermal power plant dispatch or availability given the ongoing gas pipelines projects in Argentina, so does higher gas availability for your thermal power plants? And do you think it could be enough to replace all the power imports of Argentina?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

In terms of our units, the impact could be minimal because most of them are dual fuel. When there's no gas available, they use diesel oil or fuel oil. We don't anticipate a significant effect on dispatch, although there will be an impact on costs since gas is much cheaper than fuel or diesel oil. Regarding imports, we are reducing imports of natural gas from Bolivia and transitioning to gas from Vaca Muerta. As for electricity imports, we don't expect any changes. During peak periods, particularly in summer, we face constraints on demand, and we have been importing electricity from Brazil during these peak times, independent of gas pipelines. Once the new Terconf or tender offer for new power in AMBA is established, we may see changes in a couple of years, but this is contingent on the demand growth in Argentina. If the industry begins to grow again, we will require both increased power plant capacity and continued imports from Brazil during peak times.

Operator, Operator

Our next question comes from Matias Cattaruzzi from AdCap Securities. Please, Mr. Matias, your microphone is open.

Matias Cattaruzzi, Analyst

Hi, everyone. I'm Matias. I got a question about the summer months ahead with the contingency plan that the government wants to implement. How would that affect the company in terms of operating metrics, costs, and its overall financial performance? And do you have an EBITDA forecast for the following quarter and the next year? And as well I got another question about the dividends policy. You've been giving some dividends over the end of the last year and now you paid dividends again. Are you going to insert a rule of dividends or are these just retained earnings that you're phasing out?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Okay. I am going for the first question. In terms of operation during this summer, of course, as you know, we have a very short backup in terms of capacity in AMBA specifically in AMBA region. So for sure we expect our units operating at higher levels this summer, of course, depending on the climate and the temperature, but in the temperature that we are expecting, that is a high temperature for summer, we expect a higher dispatch of our units during the summer. In terms of remuneration, as I mentioned before, this new scheme is not a driver changing in terms of remuneration is an additional amount to maintain or to perform some additional maintenance on our units. But it's not a game changer. I think it's another step trying to increase or not in terms of, not increase, not keep going down our availabilities of units that are in the spot market. But it's not a game changer, so we do not expect a higher impact in our EBITDA.

Matias Cattaruzzi, Analyst

And then dividends?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Regarding dividends, we are in a growth phase and are increasing our capacity and investments. We're working on closing our Brigadier Lopez open cycle and investing in new solar projects, while also exploring new opportunities. Therefore, we don’t have a strict dividend policy yet. Every year, at the end of the year, we evaluate our cash flows, and if there’s enough cash available, we intend to pay dividends. As we establish a clearer path in terms of growth and market opportunities, we aim to implement a more regular dividend payment schedule. Currently, our approach involves monitoring cash flow, expenses, and available cash at year’s end to determine if dividends can be paid.

Matias Cattaruzzi, Analyst

Great. And one last question. Can you give us more guidance on next quarter and the following year in terms of EBITDA?

Alejandro Diaz Lopez, Corporate Finance and Investor Relations

Yes. We are not anticipating a significant change until the government establishes the new scheme for signing PPAs or modifies the regulatory framework. The EBITDA we expect for 2024 is likely to remain consistent. However, if the government allows private contracts and deregulates fuel acquisition, we expect a noticeable difference in EBITDA. It's challenging to provide a specific figure since the regulatory changes are not currently available.

Matias Cattaruzzi, Analyst

Okay, great. Thank you so much.

Operator, Operator

This concludes the Q&A session. I would like to turn the conference back over to Mr. Fernando Bonnet for any closing remarks. Please go ahead, sir.

Fernando Bonnet, CEO

Thank you to everyone for your interest in Central Puerto. We encourage you to call us for any information that you may need. Have a great day.

Operator, Operator

This does conclude today's presentation. We thank you for your participation and wish you a very good day.