Good morning, welcome to our Full Year 2022 Earnings Result Presentation. I'm Daniel Lozano, Chief Strategy and Capital Markets Officer. I'm here with David Ruiz, CEO and Chairman of GRENERGY, Mercedes Español, Chief M&A Officer, and Javier Muguruza, our ESG specialist. Well, at the end of the presentation, as you may know, there will be the Q&A session, just for Sell-Side Analysts. I will let you know at the end how you can ask your question. Now, I'll hand you over to David.
Okay, thank you. Okay, thank you, Daniel. You can hear me correctly, right?
Yes.
Okay. Good morning, everyone. Thanks once again for being here with us. Today, we have invited Mercedes, apart from Daniel, our Head of M&A, and Javier from our ESG team to join us. I will try to make my presentation as short as possible to leave more time for them and Q&A. It has been a long and difficult year, like I would say like every single one from 2020. At least it seems the pandemic is really over, not really in the news anymore. We have some other strong hot topics. To briefly summarize this year, I think in Q1 2022, we still had some concerns with supply chain and cost inflation. I think those concerns are way over now.
Maybe I would say with the exception of substation and high voltage materials that we see a bottleneck there, we are more than glad to elaborate in the Q&A. The PV cost and storage CapEx, which is more and more important for us, is now moving down, and logistics costs is nearly back to where they were before COVID. In Q1, the situation in Ukraine changed everything, changed it all, and it's been the strongest acceleration factor we've ever witnessed in our industry. I think all markets, particularly in Europe, are booming. The IRA in the U.S., Next Generation funds in Europe. Storage BESS is booming all around. Hydrogen does not seem like a distant dream anymore.
I think we expressed, like we expressed in our previous presentation, we feel we are so lucky to be in this industry with opportunities all around, right? As we explained in detail in last presentation, we are doing our best as a company to get the most of this momentum. We have an ambitious development plan in Europe, right? Apart from Spain, we are now in Italy, the U.K., Poland and Germany. In the U.S., as we have recently announced, we purchased 100% of Sofos Harbert. I believe more than ever that the timing was perfect to purchase this company. Initially, we purchased a 40% interest, and now we have 100%.
We are now accelerating the development plans in the U.S., which hopefully will become our largest market a few years from now. In storage, well, you know, we have, I believe, one of the best dedicated teams in the industry. Our first projects, we will inform about them very, very shortly coming from Chile. If we have to mention the biggest constraint for us in the last couple of years would be definitely the delay in permits and permitting. We can be slightly more optimistic today. We finally, as we announced, obtained all the IAs in for some of our largest plants in Spain. I'm talking about the Tabernas, Ayora, and José Cabrera projects.
They finally came, I would say, with two years delay but right at the end of the deadline. Well, the truth is we have them and we are starting construction in Tabernas already, and procurement, and we will start construction very, very soon in Ayora and José Cabrera. Very busy first half of the year in capital markets. Capital increase of EUR 90 million in June. Earlier on in the year, we raised EUR 52 million in bonds at 4% rate. It seems like a very, very good deal now. We've been also using the program of commercial paper during the year, right? Moving to key highlights, and I will review very briefly. EBITDA of EUR 50 million. This is 21% up.
If you look in more detail, I think Daniel will elaborate more, but EUR 36 million already coming from our IPP division, which is nearly 3x more, and it's basically what we expected at the beginning of the year, all right. This is coming just with 500 MW on average fully commissioned during the year. Remember we started the year at five something, right. We now have 2 GW, well, 1.6 GW in operation, under construction and plus a backlog of another extra .5 GW , which will be very soon under construction. I don't know, it can give you an idea of where we are heading to, right. A year and a half or two years from now.
EUR 22 million of EBITDA came from our build to sell division, which is approximately EUR 12 million-EUR 13 million lower than expected. As we explained, we transfer three plants in Chile to a regular investor or a client in the U.K.. Only one of them was in the accounts of December, and the other two were in the accounts of January due to some condition precedents of minor permits that were not met until the end of January. The picture would have changed, and we would have been in EBITDA of EUR 60 million something, and net profit above EUR 20 million something. I think this is a one-off, and net profit is down 30%. I think Daniel will elaborate that.
The main reason is EUR 18 million of exchange rate differences from the situation in, at the end of the third quarter until the end of the year. You know, the U.S. dollar jumped from 0.95- 1.10 in just a matter of three months. This has a very important effect in our accounts since we are reporting in euros, right? Anyway, we can elaborate more on this. About sales, we were very close to EUR 300 million, EUR 293 million. This is 33% up from last year. Looking in detail, we see nearly EUR 60 million already coming from energy sales.
This is up 3x from around EUR 20 million in 2021 and zero in 2020. It gives you an idea of the exponential growth we are having. EUR 2.6 million operational maintenance and EUR 232 million coming from our construction division, EUR 50 to third parties and EUR 182 million for our own CapEx, right? If you look at the situation only two years ago, in 2020, we were reporting EUR 113 and EUR 23 million EBITDA. Well, we are multiplying by three the size of the company every two years, and this is what we are expecting in the next two years, in 2023 and 2024. Looking at pipeline, well, it's 1.6 GW in operation and construction.
This is roughly 0.7 GW operational or fully completed and 0.9 GW under construction. We have also a backlog of 0.5 GW that we will start construction very soon. Most of these parks are in Spain. We have a backlog of 2 GW. Altogether, we're talking about 4 GW, giving very high visibility on our 2025, 5 GW target. We have very recently started the procurement, yeah, of some stations and closing the procurement of main materials for Tabernas plant, 250 MW. It's the largest plant so far that we have ever built, and it's located in Almería, as you know.
Well, when it comes to this area, we are very, we are once again, very proud of our great achievements. We are really positioning ourselves at the forefront of sustainability. Indeed, this is supported by the main ESG ratings for which we are applying. For example, very recently, we really want to highlight this successful improvement in CDP climate change from B- in 2021 to A- in 2022. It should be pointed out that this CDP is one of the most globally recognized climate change ratings, and it really reflects our commitment and an increasing level of ambition of our climate strategy.
I would also like to highlight the accomplishment of 100% of our ESG objectives for the action plan 2022. Not only 2023 ESG targets have been approved and are already in progress, but also we are working on updating the ESG roadmap for 2024-2026 period, which will be released at the end of the year and will give plenty of visibility. Last but not least, I'd like to highlight that we've published and for the first time audited by a third party the sustainability report 2022. In this way, we provide our stakeholders with stronger credibility, quality of information and better ratings. Thank you. I give the floor to Daniel.
Thank you, David. Let's move on to the financial part. If you go to slide number five, you can see how total revenue reached EUR 293 million. That is 33% increase year-on-year. Development and construction division increased around 20%, 17.8%. In the last quarter, we have been able to rotate one PMGD asset in Chile and 222 MW of projects under development in Peru. 150 MW Lupi, Solar PV Lupi project, and 72 MW in Navajovar. Energy sales tripled to EUR 57.8 compared to EUR 19.9. This figure will be increased in every quarter as we are connecting projects. Moving into next slide, which is number six, we can see how this revenue was reflected in EBITDA.
Starting from the development and construction, we have a lower figure this year, EUR 22.1 million compared with EUR 33.1 million. That small contribution was what David explained at the beginning of the presentation, the highlights. There has been a non-expected delay of rotation of two PMGD asset that represented around EUR 11 million that will be registered in Q1 2023. Even though the EBITDA contribution from this division has been EUR 17.1 million in the last quarter of the year. Energy EBITDA is first time the main EBITDA driver of the company, moving from EUR 13.3 million to EUR 36.1 million in the period.
Also to mention that corporate expenses moved up a little bit, from EUR 5.3 million- EUR 8.5 million. As you may know, we are speeding up our European and U.S. platform, and that is where OpEx the part that is not CapEx is registered. If we go to slide number seven , we have been speeding up the investment in the last quarter of the year. GRENERGY in the full year invested EUR 194.4 million, mainly in solar projects under construction, utility scale and distribution projects, and as well, development CapEx that for the same reason we are increasing our corporate expenses.
Development CapEx, that is the way we are investing to generate pipeline, has moved up to EUR 15.9 million and is expected to grow as we are speeding up the development of pipeline in solar, wind, and storage, and speeding up in Europe and U.S. as later we'll explain Mercedes. In slide number eight, you can see the evolution of the cash position during 2022. The evolution is from a starting cash balance position of EUR 68.7 million. We have the positive EBITDA of EUR 50.2 million, a positive working capital. First time in the year, reverting the negative working capital we were having, now is EUR 20.2 million positive. There has been some financial and tax expenses, cash out, EUR 31.9 million.
Some cash exchange rate difference, EUR 1.9, the growth CapEx I have explained, EUR 194.4. Some small short-term liquid investment, treasury share, EUR 1.2. It has been mostly financed with the bond and commercial paper program in place. The financial debt, that is mainly project financing and some corporate debt, EUR 56.5 million, and the share capital increase that we did in June 2022 of EUR 90 million to reach EUR 105.7 million by the end of the year. Finally, in slide nine, that is the evolution of our net debt.
It is mainly the explanation of the cash flow. There has been as well some non-cash out exchange rate differences of EUR 35.5 million, mainly because we have the debt in dollar. There has been an impact in the appreciation of USD in the part of the debt. Total debt at the end of the period was EUR 339.7 million. That is overall leverage of 6.8 times net debt EBITDA. For covenant reasons, the corporate leverage was 3.0x net debt EBITDA. That is below our 3.5x corporate leverage covenant.
Now, we move into pipeline. I leave the floor to David again.
Thank you, Daniel. I'm just gonna make it very, very short to leave more time for Q&A. I think we have in the previous presentation, we explained our strategy. We really want to get the most out of this fantastic opportunity. In the medium and long term, we are working very hard in the U.S. and in the new markets in Europe, right? I think hopefully we could start the construction of our first projects in Italy and hopefully something in Poland at the end of next year. I think the first projects in the U.S. as well. This is gonna change the profile of the company completely.
Going to the total pipeline, we have 11.7 GW, close to 12 GW under the different stages of development. We don't consider in this figure the plants that are operational. I think in next quarters you will see a very important acceleration of these identified opportunities on early stage, and many projects move from early stage to advanced development. Since we will incorporate plenty of new projects in the new markets, in the new regions, right? This is very important, this slide, to show how the profile of... and the areas, the geographies where we are developing is... where the company is changing, right? You can see very clearly that the U.S. now is 2.5 GW. It's very close to take on, overcome Chile as our largest market.
I think definitely will be our largest market in terms of megawatts under development very soon, maybe in the next update, with plenty of new identified opportunities coming in new areas. Chile still remains quite strong, right? But we are not really incorporating new identified opportunities. There will be some coming up, but the market's a lot more mature. This is the case of Spain, close to 2 GW. But look at the U.S., now we have 2.5 GW. 2.5 GW Chile, 2 GW in Spain, and many of them are very mature, right? Then around...
Well, now more than 1 GW in Italy, more than 1 GW in Poland, we have lower activity in the U.K. with strong focus in storage lower activity in Colombia and Peru. That's kind of the profile of the company and where we are heading. Again, we might expect an acceleration in some regions of identified opportunities and early stage very soon. Looking at the picture, right? We are now putting together what we have, in operation or concluded, plus what we have under construction, plus what we have in backlog. Again, many of these projects we will start construction very soon, in the next few weeks. We are talking about 2 GW.
We have also a big visibility on these extra 2 GW that are now, some of them are coming from the new markets like U.K., Italy, Poland, and the U.S., plus what is coming from operational markets like Spain, Chile, and Colombia. We might expect as well many projects to jump from early stage to advanced development in the next few quarters, and many of these projects, in particular some of the projects, large projects in Chile, will soon get it through and make it to backlog, right. Keep an eye, I think in the next few weeks and months, I think we will be announcement very important agreements in terms of PPA agreements, right. To give full visibility on whatever we have under construction and all our backlog, right.
We might expect big announcements in Spain and Chile and also in Peru, right? I think in the next few weeks, once these PPAs are fully binded by then, we will announce them to the market, and we will give you plenty of information. I think next quarter we will have strong focus in explaining those PPAs. I think I give the floor to Mercedes to an update on the build to sell strategy. Thank you.
Okay. Well, thank you very much, David. It's a pleasure to participate in the presentation. We'll give you an overview of our build to sell activity as well as our current situation and plans in some markets as the U.S. and in Europe. As you might know, we have had a unique and successful rotation asset program, which since 2017 has mainly involved Chilean assets, PMGDs, where we have sold around 500 MW in 55 different projects. This is more than $560 million, allowing us to generate, during that period, the required cash flow for our build-to-own business model and growth strategy. Last year, 2022, has been a good example of our intense M&A activity.
We sold three PMGD plants in Chile, totaling 29 MW, and two almost ready-to-build, under development projects in Peru for a total of 222 MW, contributing more than EUR 22 million to the EBITDA of the company. In addition to this already significant amount, towards the end of the year, we agreed a third transaction with the same buyer, as David mentioned before, of two additional PMGs for a total of $30 million, but the signing, well, took place in January this year. As said before, this transaction, the contribution to our EBITDA could have been up to $33 million. As part of the GRENERGY strategy, we are expecting during 2023 few additional rotations in Chile, probably in Colombia.
Regarding Spain, we are also launching, well, it's public now, a transaction for the rotation of our minority stake in a 1 GW portfolio, fully secured, which we have developed from scratch, all to be contracted with tier one off-takers and constructed by our own EPC company. We call it Valkyria, and, well, we consider it a unique opportunity in the market. We are actually seeing a huge interest for, from, well, different type of investors. Around 60 were willing to participate, and around 20 of them have been granted access to the first phase. We might receive NBOs in March, and after a pre-market research service carried out in December, we are expecting an enterprise value above EUR 1 billion.
Once this is concluded, it will give us the possibility to increase the cash position for our growth plans in other strategic markets for the company, such as the U.S. or other countries in Europe. Moving to the next slide, some words for one of the most promising markets, as I said, for us, the U.S.. As you might know, upon the publication of the Inflation Reduction Act, the IRA, there is much more clarity and certainty on how the government is pushing for the growth of renewables in the country. The program allocates $370 billion for U.S. tax credits and direct payments for renewable energy.
The government is expecting PV deployments to increase from around 60 GW, 70 GW- 1,000 GW by 2035, and that was one of GRENERGY's drivers that result in the purchase of 100% of Sofos Harbert, the developer that we totally integrated early this year. This full acquisition gives us a real opportunity to accelerate our activity in the market, which with the consolidated team of close to 20 people, I think we are in a privileged position in this market where we start with almost 2 GW.
This pipeline, well, mostly located in the southeast, is now strongly complemented with projects in MISO, PJM, and also ERCOT, which is a key and more liquid market to diversify our presence in the U.S.. That also gives us the possibility to participate in different schemes, either through PPA with corporate, public, or wholesale market. A very promising situation in the U.S., as you can see, and we're very happy regarding this full acquisition and integration of the team. Going to next slide. Around three years ago, we strongly focused in Europe, driven by the European Commission plan, REPowerEU, and, well, accelerated by the Ukrainian war. We are becoming, I think, very well prepared to participate in this acceleration plan to fast-forward the green transition.
As you know, the EU strategy is to double the current solar capacity by 2025 and install 600 MW by 2030 to reach the target. Most of the countries are pushed to implement laws in this sense and to accelerate the permitting process, which is crucial at this point. There's a perfect momentum for renewables in Europe. Going to the very fast to the specifics on each market. We have presence in five countries. We are now well consolidated, apart from Spain, of course, Italy, Poland, and the U.K., with a staff of around 15- 20 people in each of our offices there and an overall pipeline of around 2.5 GW in these three countries.
We are, in any case, launching significant acceleration plans in these markets as we're really confident about their potential. We are successfully establishing ourselves in Germany with a local staff of 20 people for the moment. The country has an extraordinary potential for PV and storage, and has very ambitious and specific plans targeting 215 GW by 2030. This means the installation of around 21 GW per year, which is huge. This country will therefore be key to our growth strategy in Europe, and we are putting all efforts in terms of human resources and allocation of CapEx in order to have a significant market share in a couple of years from now.
It's equally important to point out our M&A buy-side activity here, where we are frequently analyzing different portfolios and projects, giving us the flexibility and possibility at a certain point to accelerate our activity. As said, we have very ambitious plans in these markets, which represent with what, Spain more than 80% of the European energy demand. We are sure that they will contribute to position ourselves on the right path to achieve our 5 GW target by 2025. I give the floor now to Javier for ESG.
Thank you, Mercedes. It's an honor to take part in the presentation. If we move to the main ESG commitments in the next slide, we can see on the left part of the first page, you can see the achievement of the ESG Action Plan 2022 with the accomplishment of full 2022 ESG objectives. On the right part of the slide, we can see the Q4 objectives, integration of ESG aspects in the procurement process. The main highlights to point out are the update of the procurement procedure and supplier code of conduct with integration of ESG clauses. Here, and also ESG risk assessment and normalization process. Next Q4 objective, project-level human rights impact assessment.
In this objective, we have carried out an identification and assessment of potential human rights impact in the operation process and supply chains of GRENERGY. In order to identify human rights impact, we have conducted human rights training for key personnel, country risk analysis, and internal and external questionnaires to conclude with the identification of these potential impacts. Finally, the water use program. GRENERGY is aware that water is a limited resource and irreplaceable natural resource. In this sense, we have extended and improved the direct water footprint measurement according to ISO 14046. To carry this, we have considered data collection based on the origin, regional use, and location of water stress areas, and with these inputs, we have computed the GRENERGY's water impact and established finally some improvements to implement.
If we move to the next slide, If David, can we move to the next? Thank you. We can see the last phase of the ESG roadmap 2021-2023. Here we can see the 12 objectives for the whole year, explaining the implementation in the quarterly progress reports with a quick Q1 objectives already in progress. The ESG 2023 action plan was presented and approved by the senior management and the board of directors at the end of this year. We are already working on updating the ESG roadmap 2024-2026 plan, not only to comply with all current and future ESG regulations, but also to improve our ESG positioning in the industry and address stakeholder expectations. Finally, if we move to the last ESG slide, we can see.
In expansion, improved positioning and leadership ratification in ESG ratings. In this sense, we have submitted in 2022 CDP climate change, upgrading from B- to A- , placing in the leadership category. Also in 2022, we expanded our ESG rating coverage, in this case Refinitiv, where we obtained an outstanding ranking of 2nd position out of 79 companies in the renewable energy sector. In addition, to the previous ratings published in Q4, it is worth pointing out the following ESG ratings accomplished in 2022. First of all, remarkable top ESG rating distinction evaluated by Sustainalytics, out of 15,000 companies, having industry and regional distinction. ESG risk is almost negligible by Sustainalytics.
Furthermore, MSCI improved performance in MSCI, obtaining the highest, 3.8 score. Finally, A- score in ESG with a very high level of transparency.
Okay. Thank you, Javier. I think now presentation is over, so let's move on to the Q&A session. There is a chat available, so please, if you have any question, please send a direct message to the administrator using that chat tool. Well, we will let you know when you can ask your question. Thank you.
Miguel, now I think we have Fernando Garcia from RBC. Hola, Fernando.
Hola, Daniel. Thank you for taking my questions. So I have two, no? First on this Valkyria project for the investment of Spanish assets. So I would like to ask probably Mercedes about the timing then on PPAs for these projects, not all of them have PPAs, so are you setting as well to sign PPAs for these projects that you don't have it in the short term? And then on the cash inflow, I would probably expect that maybe we can expect something when you sign the deal, and then maybe a part when the, you know, when the asset tariff commission, can you explain a little bit how this is going to work, your idea? And then if you can tell us how this is going to work, is it going to be in line with the cash flow of the several projects when they are commissioned?
And finally, one probably question for maybe you can comment on what are the expected for the proceeds that will be quite significant, no? Second question, looks like CapEx is going down. Could you update on that, as well on a little bit on OpEx and financial costs? And I would appreciate based on that if you can elaborate a little bit on your expectations of earnings in 2023 versus 2022. So these are my questions.
Thank you Fernando. I think we've got plenty of questions. I can try to reply, or well, if Mercedes wants to jump, but I think I can reply very quickly. Clearly about the PPAs, we are starting to announce. Well, the whole idea about Valkyria is offering the market something that is really unique. You know, there are many deals in the market. There is also a strong appetite on the both on the sell side and buy side. We wanted to make something big and unique, and I think one of the key aspects was to make sure that all the portfolio was fully contracted. Well, you know that on one side we have Escuderos, we have Belinchón.
These plants are already operational, and I think you have information about the PPAs. We will announce very shortly the off-takers. On one side, we will have an off-taker for Tabernas and Ayora and Jose Cabrera. Part of this has already been agreed. We are extending to the full package. I think during March, we will announce a single off-taker for all these packets. We'll also announce very soon, maybe next week, the off-taker for La Ferial, which is part of Trascantas project. About, I think, Fernando, maybe you can mute. Yeah, thank you. About the proceeds, it's... Well, you're talking about different... We're talking about different scenarios, right?
On one side, as Mercedes Español pointed out, there was a very high expectation on this on this process. Some bidders are looking more at COD, some others are looking at investing are ready to build. Depending on which partner we finally bring in, it will be a different situation in terms of cash flow. Obviously, we will try to maximize the value. Again, we believe this is a unique opportunity. It's fully contracted. Really skin in the game from the sponsor. We are building the plants. We have developed all of them from scratch. We will be in charge of the operation, maintenance, and asset management, right?
Depending on, for some existing operational projects like Escuderos and Belinchón, we might expect the proceeds to be cashed in very quickly, as early as Q2, Q3. For the remaining plants that will be under construction, It really will depend on the final profile of the investor, whether the proceeds we have visibility on the proceeds at the end of this year or during 2024. Anyway, Once we conclude, obviously, this process, we will give you visibility. About your question about CapEx, OpEx, internal rate of return. CapEx is going down for solar. It's mainly due to the reduction in the price of panels.
I think we're now procuring panels for $0.20-$0.21. Well, sorry, that's US dollars, right? This is compared to $0.24-$0.25. This has beaten really our estimation, right? If you remember, we were in November talking about... I think we have a slide here. We were talking about below half a million EUR. I think our expectation now is that we will be EUR 570 million, maybe EUR 570 million-EUR 580 million. Once again, this is for a very large plant in a country like Spain. If the plant is smaller in a different market, it would be slightly higher. OpEx cost- there's more inflation there, right?
I think the operations and maintenance is a very mature market, so, you know, we're talking about prices of $4,000, sometimes $3,500 per megawatt here, right? There is some inflation in the land at cost, of the lease cost of land, in some markets, right? Now, this is something we are witnessing in Europe now, where we are all struggling to grab and to secure the best lands available in markets like Poland and Germany, and it's been the case of Italy. We see some inflation there, right? I think considering the rest of components of CapEx, as I mentioned earlier on, we no supply chain issues at all, right? Logistics are, well, back to pre-COVID, I would say. We're paying now again, $2,000 per container.
But maybe only the substations and the high voltage materials, everything that is coming from Hitachi or General Electric or Siemens, we really see a bottleneck there, right. Prices are increasing and the delivery times are becoming an issue in some cases. Internal rate of return of projects is the project IRR. We are happy to say that we are very close to double digit in our main markets in Spain and Chile. Still the finance and the market is very competitive, and we can increase the especially in Europe, the equity IRR quite a lot to meet maybe in some cases 14%-15%.
Well, Fernando, this is, more or less an update on the situation.
Thank you, Fernando. I think we have now Jorge Guimarães from JB Capital. If you can ask please 1 question so that we have question from all the sell side analysts. Hello, Jorge. Miguel, can you unmute Jorge?
Hi. Good morning, everyone.
Hi.
My question is related to the prices of PPAs. If you can give some color on the type of prices of PPAs that you are getting in Spain and in Chile and the duration of those PPAs. Thank you very much.
Hi, [inaudible], Jorge. I, there are no changes. I mean, the conversations we are having in Spain, we've been having those conversations and those negotiations for more than a year. Where we are now is we are finalizing the agreements. I think, as I mentioned, we have managed to sign PPAs in the region of mid-40s, right? In some cases, slightly higher. I'm talking about the new PPAs. I'm not talking about the PPA for Belinchón. That was in the low 40s. Well, you know, the PPA of Escuderos was in the high 30s. To compare apples with apples is always what we say. We are talking about PPAs starting at Belinchón, Escuderos, we were talking about 12 years, right? Belinchón is starting in the beginning of 2025.
It means that we're gonna have more than one and a half year full merchant, right? The plant, we start commissioning of the plant, I think in April/May. Hopefully in June we'll be fully operational and then sending energy, and we will be one and a half year full merchant, and then the PPA will start. When we are comparing one PPA with another, you also need to consider that each one is a very different animal, right? The new PPAs we are closing in Spain, we are talking about PPAs starting mid or the end of 2025, right? We're talking of PPAs in the EUR mid-40s and for 15 years, and we're securing around 75% of the estimated production of the plant.
We are strong believers that the plants should be contracted and the higher percentage, normally the better, right? We also recognize that there is an upside on, in the short term in high merchant prices, right? That's the situation in Spain. The situation in Chile, we have big announcements to make, I think, in the next few weeks. We announced, firstly, the PPA for Gran Teno Antamanga plants that are under construction. And those PPAs were closed in low 30s. You have to consider that, well, we're talking about mid-30s. Sorry, mid-30s. mid-30s in U.S. dollar, but we have high radiation there, and there's a big difference.
Those PPAs are indexed, so, you know, in maybe, or already in, when the plant gets commissioned, we will be in the high 30s, and maybe 10 years from now we will be in the mid-50s. It's a completely different, you know, the normally PPAs in Latin America, and I think will be the case in the U.S., will have some kind of indexation. In Europe, you're talking about a fixed price. Again, it's hard to compare, right? It's again, different animals. Thank you.
Thank you, Jorge. Now we have Naisheng Cui from Barclays.
Hey, good morning, everyone. Can you hear me all right?
Yes.
Yes, perfectly fine.
Perfect. Thank you. Two questions from me, if that's okay. The first one is leverage ratio increased a third time in a row. Just wonder, will GRENERGY consider equity rate this year? If yes, could you please provide a little bit of color on the timing and magnitude? My second question is, strategy-wise, what is your key focus for 2023, and do you have any target for capacity under operation? Thanks.
Thank you. Thanks for your two questions. I was trying to reply your second question. About the leverage ratio, well, it's been very minor increase. If we have it reflected in our accounts, the two PMGDs that we transfer at the end of January, it was really a deal that was agreed in Q4, but it couldn't be completely formalized until very early 2023. I think the ratio would have been better, right, even below six. It's what we say. I mean, when we are doubling, we are now really in a very strong investment period.
We are increases multiplying our CapEx by two in a matter of 12 months, right? Sometimes CapEx and the debt that is associated to this CapEx comes first, and the EBITDA from the generation of these plants, normally there is a mismatch of around two, three quarters, right? It's hard to compare. You will even see increased levels of leverage in the next few quarters, and then it will tend to stabilize, right? I don't think it's something that we are concerned. We are, as we have mentioned, we are fully financed for this year, right? Obviously, we are a public company. We have, you know, plenty of room for further capital increases if these are needed, right?
We might look at them as we have expressed many times, maybe in 2024. It will depend on the evolution also of our build to sell activity. These battery projects and the sale of minority interest is a fantastic opportunity to raise capital in a different way. At the end of the day, it's similar effect to a capital increase. We are fine. We are not expecting any deals this year. We have very strong acceleration factors in our equity story and in our business plan. We are in the U.S., we...
Germany, those are markets, where we are celebrating also our storage plan. One point we might need to raise new capital, but I reckon it will not happen until 2024. Your second question about, I think it was about strategic, what was our key focus for 2023. Well, we want to focus on execution and execution. Finally, I think some of the permitting bottlenecks are clear. We're very happy to say that from next quarter, we will have more than 1 GW under construction. This is really a lot. I mean, we are talking about delivering 600 MW-700 MW per year now.
We really want to focus on execution on one side in our main traditional markets like Chile, Spain, which is really where the construction activity now is focused. At the same time, we don't want to miss the huge opportunity we have ahead, and we are accelerating our development plans. We are really recruiting more people focused exclusively on development in our new markets, mainly the U.S., Germany, Poland, Italy and the U.K. I think, you know, this is where we're gonna be really focusing in 2023.
Okay. Thank you, Nash. Now we have Henry Tarr from Berenberg. Hi, Henry. Miguel, can you unmute Henry?
There we go. Hi, hi guys, thanks very much for the presentation. Just to sort of follow on from that, from that last point, really, are you seeing improvements in the permitting processes across different countries? Do you think there are, you know, processes which are getting easier or governments are getting better at pushing these permits through? Then, I think you're mentioning building up the teams, et cetera. You know, you're looking to do 1 GW per annum. Do you have enough resource within the organization today to really deliver that? Where are you looking to build? Thank you.
Thank you. Well, you've mentioned two of the... Well, when we always mention the biggest constraints we have, we do mention permitting is one, and talent is the other one, right? I think some way or another, we always find a way to finance our plans, but building the right teams now is really challenging, right? It's really challenging everywhere in this industry. There are some markets like the U.K. or Germany and the U.S., where it's really becoming very challenging. We are doing our best. I think building a team of 20 in Germany from scratch in six months, considering in this market, they need to give, like, a three months notice on average, it's really an achievement.
We're very, very proud of our human resources team. While we're doing our best, we are offering the key employees access to stock option plans, which is something that traditionally has had great results and is a very fair deal, we believe, to make them part of the success of the company. You know, we identify that the lack of the right people is one of the major bottlenecks that we might face in our expansion, so we are working very hard in every market.
We are now a company with more than, Well, getting close to 400 employees, and more than 100 are focused exclusively on development, and this number will definitely grow in the next, in the next few quarters. About permitting, something is moving. I don't wanna be that pessimistic. I'm more optimistic now. I mean... Well, maybe it's because we just got the environmental permits in Spain that we have long awaited. But, but I think it's something's moving. I mean, in the new markets, what we call new markets for us, of like Germany, something is really moving in many regional governments. In some cases, they're promising, you know, some periods, for approval of a year. They, they seem...
They're looking possible, but in some cases, they're opening fast tracks. Some lenders in Germany, some regional governments are really publishing new fast tracks and new laws to accelerate the permitting process. I think in Italy, we are looking at some changes in some regions. Some others is still need plenty of time, but Sicily and Lazio and Basilicata, things are moving faster now. Well, in Spain, in Spain we're now fine. That finally we made it, right? The environmental permits. Now, it's the rest of permits we need are really should be fine to get them, right? It's...
The thing is that it's been identified by all administrations at the EU level, at the country by country, as one of the major constraints in the industry. I think this is good, right? That at least it's been identified and we need more renewable energy. We need this energy now. I think the main constraint is permitting.
Okay. Thank you, Henry. Now we have Flora Tindall from CaixaBank BPI. Hi, Flora.
Hi. Good morning. Thanks for taking my question. I have a question on the tables you usually provide on pipeline. If we compare with the data from nine months, there seems to have been a decline, I think mainly in Chile. If you can explain, some projects moving into 2024. Also, if we add up those projects, we reach around 400 MW to be added or with COD in 2023 versus the 1 GW you expect to have under construction. This is your central scenario in terms of additions for this year? That would be my question. Thank you.
Okay. Thank you. Thank you, Flora. I think you might refer to this table here, right? Well, we have a very large plan in Chile under construction. This is Teno. I think it is expected to be fully operational in, I think the date we now have is November this year. So it's Q4 2023. It's really going to change Chile because we're talking about 240. We have next door, like a smaller plant, Tamango. We are using the same off-taker, in fact, and the same financing for the two plants, right? And the last date we are considering is January 2024, so it's first quarter 2024. So altogether, we're talking about 300 here, right? Then we have our PMGDs.
It's business as usual, you know. We keep building those plants. We now have 60 plants for us. We closed the financing for this 140 with Natixis. We are looking now on either an extension of with Natixis or using another bank to finance this lot, plus this lot here of 130 that we are starting construction very, very soon. It's a new scenario for PMGDs. Some of them will be full, purely solar. Some of them will already incorporate storage. It's a different scenario, and we are working now with. You know, banks really need some education on this. We're working very hard in Chile for the PMGD.
We are expecting, in any case, to connect in Chile before the end of 2024, we are talking about Teno and Tamango utility scale, the 300, plus at least another 200 in PMGDs. This is our expectation for 2024. For 2025, we have new plants coming up that you will see them very shortly, I think in the next update, in the backlog. We have plenty of large plants here. We have a fantastic pipeline, we are securing the PPAs first, I think we'll give some light very, very shortly, right? That's the situation in Chile. In Spain, we have, well, Belinchón, we are missing 50. This will be completely finalized at the end of next month.
Then we have Tabernas, and we are about to start construction on procurement very soon of Ayora and Jose Cabrera in Spain. I mentioned all these. Well, that's more or less the how it helps. Next update, you will see a big increase in backlog coming from the large project from Chile, and hopefully we will include one of the Clara Campoamor, maybe, 275 out of these 575, which we are announcing the PPA also very shortly.
Okay. Thank you, Flora. We have Daniel Rodríguez from Bestinver.
Okay.
Hi, Daniel.
Hello, hello, good morning. Can you hear me? Yes, I have more is a theoretical question. Well, we have seen that all the permitting, all the permits, all the environmental permits have been approved, like in a single date for everybody. I mean, all of you, all the developers are announcing these projects. I'm a little bit concerned that what is going to happen in 2023 and 2024. Whether this could have an impact on creating another bottleneck, either on connection, on construction, or on PPA negotiation. This could be a concern on whether this could trigger the possibility because I have seen all the PPAs you have in place are basically in Spain, pay-as-produced.
Whether you could consider a more sophisticated type of PPAs in light with this higher competition. This would be my question. Thank you.
Thank you. Thank you. It's a very relevant question. I think that's the reason why we are securing everything with PPAs. I think maybe a month from now, we will make the, all the announcements and all our pipeline in Spain. I'm talking about this pipeline, right? This from whatever we have under construction to whatever we have in backlog, and even whatever is advanced development, everything will be fully secure with PPAs. We will not be competing with the rest, on this potential, you know, outflow of projects. I have to say, anyway, that I've, I don't know, I've been a bit, I think changing my mind about the situation in Spain.
It's true that there are many projects coming up, but many of the BIAs that were published are. You're talking about projects that, for one reason or another, they are not going to be built. This is my expectation because some of them, they have very long interconnection line and some of them are impossible to build. Anyway, it will take a while. Don't expect 50,000 MW under construction next year. That's not going to happen, for sure, right? That's gonna happen from 2024, 2025 and beyond, right? Let's see, let's see how the market evolves, right? Don't underestimate the, I think this is something we are insisting the government, right? That we need a legislation for storage, right?
The more storage, the more PV, right? We need a legislation of storage, the sooner the better, right? Storage is becoming very competitive and it's sometimes it's the answer, right? We are not going to. I read on the news this morning that there were predictions of 60,000 MW of solar in 2030. That's gonna be more than possible, but with plenty of storage, right? That's something that we have to work very, very strongly. Apart from that, I don't really expect, you know, one way or another, we're gonna find a way to build these parks. The biggest bottleneck, I would say, will be interconnections, right? Substations, transformers. Siemens is sold out for the next two years. GE sold out. You know, we're gonna start working in some cases.
We have already secured our deliveries for all this portfolio. I'm sure that some of the developers have not. That's gonna create a bottleneck.
Okay. Thank you, Daniel. now we have Anis Zgaya from ODDO. We are all over 10 minutes.
Yes, yes.
So, so, so one-
Anis, if you could.
Yeah, thank you, Daniel. Thank you, Daniel. Good morning to all. I have only two questions. One on build to sell and one on build to own. Starting with the build to sell business, you have sold ready-to-build projects, contrary to usual. Is this a change of strategy? What is your target for 2023? In the build to own business, just to know if the contribution on the energy business was relatively weak in the fourth quarter, why? Thank you.
Okay, thank you. Thank you very much. In terms of build to sell, we had forecasted to raise around EUR 35 million in EBITDA, and the figure is lower than that, but because of these two deals that were finally reflected in January, right? If other than that, we would have been really in this figure. In terms of megawatts, we had to transfer. It was a different way. On one side, we transfer PMGDs, so it was business as usual for us. On the other, right, but we have been transferring, making, considering the reductions in CapEx, we've been making a higher margin, so we didn't need to sell more, right? That's we need to meet our target.
We finally transfer these four plants during the older year. We have also transferred some non-strategic plants in Peru, right? This being another deal we've made, and another way of raising, you know, of delivering build to sell plants. How are we gonna approach this in 2023 where we will keep transferring 100% interest in some plants, as mentioned, as Mercedes mentioned earlier on. But we are definitely exploring the alternative of transferring minority interest, which is another way of doing build to sell deals. Of course, if this happens, we will need to explain the investment community and all the analysts. I'm sure you are all aware of that.
That's each different way of approaching a build to sell. It doesn't go through our P&L, but it's a fantastic way to raise capitals. We make a profit after all. If this happens, we will try to explain. I don't know, we will talk about adjusted EBITDA or whatever, but we will try to explain very well the effect in our accounts of these deals, right? Because when we keep control, you know, we will keep consolidating full EBITDA, but still we will raise plenty of cash through these deals. About your second question about the relatively low production of plants in Q4. Well, on one side, we have a very weak November and December in Spain. This was affecting Escuderos plant.
Just keep in mind that we still have a relatively small number of plants. If in one quarter we had low prices of energy in our plants in north of Chile, in Quillagua, and we had a very bad rainy fourth quarter, in particularly November and December in Spain. On the contrary, January and February are performing extremely well. It's still a matter. Whenever we have a more diversified portfolio, I think the plants in the southern hemisphere will compensate the plants in northern hemisphere. We have like a more compensated approach. Thank you.
Thank you. Finally, we have Paul [Schreurs] from Kempen. Hi, Paul. Okay, Hi, Paul, We cannot hear you.
Hi, can you hear me now?
Yes. Now we can.
Yes, now.
Hello. Got it.
Paul? Okay, I think Paul is facing technical problem. As the time is all over already 15 minutes, we are gonna contact Paul to answer your question. I think we can finish the presentation.
Okay. Thank you. Thank you very much once again to everyone. Thank you. Have a great day.
Thank you very much. Bye.