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PROPERTY, PLANT AND EQUIPMENT (Tables)
 12 Months Ended
Dec. 31, 2017
Property, plant and equipment [abstract]  
Disclosure of detailed information about property, plant and equipment
Depreciation on utilities, transport, communication and energy assets is calculated on a straight-line basis over the estimated service lives of the components of the assets, which are as follows:
(YEARS)
Useful Lives
Buildings
Up to 70
Leasehold improvements
Up to 50
District energy systems and gas storage assets
Up to 50
Machinery, equipment, transmission stations and towers
Up to 40
Network systems
Up to 60
Rail and transport assets
Up to 40
Depreciation of an asset commences when it is available for use. PP&E is depreciated on a straight-line basis over the estimated useful lives of each component of the asset as follows:
(YEARS)
Useful Lives
Buildings
Up to 50
Leasehold improvements
Up to 40
Machinery and equipment
Up to 20
Oil and gas related equipment
Up to 10
Depreciation on renewable power generating assets is calculated on a straight-line basis over the estimated service lives of the assets, which are as follows:
(YEARS)
Useful Lives
Dams
Up to 115
Penstocks
Up to 60
Powerhouses
Up to 115
Hydroelectric generating units
Up to 115
Wind generating units
Up to 30
Solar generating units
Up to 30
Other assets
Up to 60
 
Cost
 
Accumulated Fair Value Changes
 
Accumulated Depreciation
 
Total
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Balance, beginning of year
$
5,783

 
$
5,300

 
$
694

 
$
612

 
$
(825
)
 
$
(596
)
 
$
5,652

 
$
5,316

Additions/(dispositions)1, net of assets reclassified as held for sale
(502
)
 
254

 
44

 
—

 
246

 
(6
)
 
(212
)
 
248

Acquisitions through business combinations
281

 
652

 
—

 
—

 
—

 
—

 
281

 
652

Foreign currency translation
292

 
(423
)
 
1

 
—

 
(13
)
 
21

 
280

 
(402
)
Fair value changes
—

 
—

 
59

 
82

 
—

 
—

 
59

 
82

Depreciation expenses
—

 
—

 
—

 
—

 
(281
)
 
(244
)
 
(281
)
 
(244
)
Balance, end of year
$
5,854

 
$
5,783

 
$
798

 
$
694

 
$
(873
)
 
$
(825
)
 
$
5,779

 
$
5,652


1.
For accumulated depreciation, (additions)/dispositions
The following table presents our renewable power property, plant and equipment measured at fair value by geography:
AS AT DEC. 31
(MILLIONS)
2017

 
2016

North America
$
22,832

 
$
17,132

Brazil
3,443

 
2,893

Colombia
5,401

 
5,275

Europe
1,088

 
1,253

Other1
826

 
—

 
$
33,590

 
$
26,553


1.
Other refers primarily to South Africa, China, India, Malaysia and Thailand
Our renewable power property, plant and equipment consists of the following:
 
Hydroelectric
 
Wind Energy, Solar
and Other
 
Total
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Cost, beginning of year
$
14,382

 
$
7,441

 
$
3,649

 
$
3,509

 
$
18,031

 
$
10,950

Additions, net of disposals and assets reclassified as held for sale
256

 
253

 
(273
)
 
80

 
(17
)
 
333

Acquisitions through business combinations
—

 
5,731

 
6,923

 
10

 
6,923

 
5,741

Foreign currency translation
29

 
957

 
25

 
50

 
54

 
1,007

Cost, end of year
14,667

 
14,382

 
10,324

 
3,649

 
24,991

 
18,031

 
 
 
 
 
 
 
 
 
 
 
 
Accumulated fair value changes, beginning of year
11,440

 
11,035

 
858

 
615

 
12,298

 
11,650

Fair value changes
341

 
100

 
33

 
216

 
374

 
316

Dispositions and assets reclassified as held for sale
(8
)
 
—

 
—

 
—

 
(8
)
 
—

Foreign currency translation and other
403

 
305

 
213

 
27

 
616

 
332

Accumulated fair value changes, end of year
12,176

 
11,440

 
1,104

 
858

 
13,280

 
12,298

 
 
 
 
 
 
 
 
 
 
 
 
Accumulated depreciation, beginning of year
(2,947
)
 
(2,248
)
 
(829
)
 
(614
)
 
(3,776
)
 
(2,862
)
Depreciation expenses
(579
)
 
(586
)
 
(287
)
 
(217
)
 
(866
)
 
(803
)
Dispositions and assets reclassified as held for sale
—

 
9

 
51

 
5

 
51

 
14

Foreign currency translation and other
(38
)
 
(122
)
 
(52
)
 
(3
)
 
(90
)
 
(125
)
Accumulated depreciation, end of year
(3,564
)
 
(2,947
)
 
(1,117
)
 
(829
)
 
(4,681
)
 
(3,776
)
Balance, end of year
$
23,279

 
$
22,875

 
$
10,311

 
$
3,678

 
$
33,590

 
$
26,553

The company’s property, plant and equipment relates to the operating segments as shown below:
 
Renewable
Power (a)
 
Infrastructure (b)
 
Real Estate (c)
 
Private Equity
and Other (d)
 
Total
AS AT DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Costs
$
24,991

 
$
18,031

 
$
9,253

 
$
8,045

 
$
5,854

 
$
5,783

 
$
4,050

 
$
5,268

 
$
44,148

 
$
37,127

Accumulated fair value changes1
13,280

 
12,298

 
3,272

 
2,690

 
798

 
694

 
(231
)
 
(243
)
 
17,119

 
15,439

Accumulated depreciation
(4,681
)
 
(3,776
)
 
(1,622
)
 
(1,190
)
 
(873
)
 
(825
)
 
(1,086
)
 
(1,429
)
 
(8,262
)
 
(7,220
)
Total
$
33,590

 
$
26,553

 
$
10,903

 
$
9,545

 
$
5,779

 
$
5,652

 
$
2,733

 
$
3,596

 
$
53,005

 
$
45,346

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

1.
The accumulated fair value changes for private equity and other represent accumulated impairment charges, as assets in these segments are carried at amortized cost
Our infrastructure property, plant and equipment consists of the following:
 
Utilities (i)
 
Transport (i)
 
Energy (i)
 
Sustainable Resources (ii)
 
Total
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Cost, beginning of year
$
2,894

 
$
2,945

 
$
2,361

 
$
1,953

 
$
2,382

 
$
1,487

 
$
408

 
$
340

 
$
8,045

 
$
6,725

Additions, net of disposals and assets reclassified as held for sale
350

 
367

 
103

 
78

 
81

 
89

 
93

 
5

 
627

 
539

Acquisitions through business combinations
—

 
—

 
—

 
242

 
100

 
825

 
—

 
—

 
100

 
1,067

Foreign currency translation
229

 
(418
)
 
191

 
88

 
67

 
(19
)
 
(6
)
 
63

 
481

 
(286
)
Cost, end of year
3,473

 
2,894

 
2,655

 
2,361

 
2,630

 
2,382

 
495

 
408

 
9,253

 
8,045

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated fair value changes, beginning of year
1,044

 
946

 
782

 
973

 
351

 
209

 
513

 
385

 
2,690

 
2,513

Fair value changes
136

 
184

 
24

 
25

 
257

 
123

 
13

 
56

 
430

 
388

Foreign currency translation and other
76

 
(86
)
 
67

 
(216
)
 
21

 
19

 
(12
)
 
72

 
152

 
(211
)
Accumulated fair value changes, end of year
1,256

 
1,044

 
873

 
782

 
629

 
351

 
514

 
513

 
3,272

 
2,690

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accumulated depreciation, beginning of year
(384
)
 
(291
)
 
(517
)
 
(418
)
 
(258
)
 
(172
)
 
(31
)
 
(19
)
 
(1,190
)
 
(900
)
Depreciation expenses
(113
)
 
(128
)
 
(147
)
 
(126
)
 
(117
)
 
(99
)
 
(10
)
 
(19
)
 
(387
)
 
(372
)
Dispositions and assets reclassified as held for sale
16

 
1

 
22

 
1

 
4

 
—

 
3

 
1

 
45

 
3

Foreign currency translation and other
(28
)
 
34

 
(45
)
 
26

 
(12
)
 
13

 
(5
)
 
6

 
(90
)
 
79

Accumulated depreciation, end of year
(509
)
 
(384
)
 
(687
)
 
(517
)
 
(383
)
 
(258
)
 
(43
)
 
(31
)
 
(1,622
)
 
(1,190
)
Balance, end of year
$
4,220

 
$
3,554

 
$
2,841

 
$
2,626

 
$
2,876

 
$
2,475

 
$
966

 
$
890

 
$
10,903

 
$
9,545

The following table presents the changes to the carrying value of the company’s property, plant and equipment assets included in these operations:
 
Cost
 
Accumulated Impairment
 
Accumulated Depreciation
 
Total
AS AT AND FOR THE YEARS ENDED DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

 
2017

 
2016

 
2017

 
2016

Balance, beginning of year
$
5,268

 
$
5,309

 
$
(243
)
 
$
(231
)
 
$
(1,429
)
 
$
(1,197
)
 
$
3,596

 
$
3,881

Additions/(dispositions)1, net of assets reclassified as held for sale
(1,966
)
 
(101
)
 
36

 
4

 
752

 
125

 
(1,178
)
 
28

Acquisitions through business combinations
501

 
—

 
—

 
—

 


 
—

 
501

 
—

Foreign currency translation
247

 
60

 
(16
)
 
(16
)
 
(51
)
 
(14
)
 
180

 
30

Depreciation expenses
—

 
—

 
—

 
—

 
(358
)
 
(343
)
 
(358
)
 
(343
)
Impairment charges
—

 
—

 
(8
)
 
—

 
—

 
—

 
(8
)
 
—

Balance, end of year
$
4,050

 
$
5,268

 
$
(231
)
 
$
(243
)
 
$
(1,086
)
 
$
(1,429
)
 
$
2,733

 
$
3,596

1.
For accumulated depreciation, (additions)/dispositions
Schedule of significant unobservable inputs
The following table summarizes the valuation techniques and significant unobservable inputs used in the fair value measurement of Level 3 financial instruments:
(MILLIONS)
Type of Asset/Liability
 
Carrying Value
Dec. 31, 2017

 
Valuation
Techniques
 
Significant
Unobservable Inputs
 
Relationship of Unobservable
Inputs to Fair Value
Fixed income securities and other
 
$
409

 
Discounted cash flows
 
•  Future cash flows

 
•  Increases (decreases) in future cash flows increase (decrease) fair value
 
 
 
 
 
 
•  Discount rate

 
•  Increases (decreases) in discount rate decrease (increase) fair value

Warrants (common shares and warrants)
 
246

 
Black-Scholes model
 
•  Volatility







 
•  Increases (decreases) in volatility increase (decreases) fair value
 
 
 
 
 
 
•  Term to maturity

 
•  Increases (decreases) in term to maturity increase (decrease) fair value
 
 
 
 
 
 
•  Risk free interest rate

 
•  Increases (decreases) in the risk-free interest rate increase (decrease) fair value

Limited-life funds (subsidiary equity obligations)
 
(1,559
)
 
Discounted cash flows
 
•  Future cash flows
 
•  Increases (decreases) in future cash flows increase (decrease) fair value
 
 
 
 
 
 
•  Discount rate
 
•  Increases (decreases) in discount rate decrease (increase) fair value

 
 
 
 
 
 
•  Terminal capitalization rate
 
•  Increases (decreases) in terminal capitalization rate decrease (increase) fair value
 
 
 
 
 
 
•  Investment horizon
 
•  Increases (decreases) in the investment horizon decrease (increase) fair value
Derivative assets/Derivative liabilities (accounts receivable/payable)
 
213
/
  
Discounted cash flows
  
•  Future cash flows

  
•  Increases (decreases) in future cash flows increase (decrease) fair value
 
(704
)
 
 
•  Forward exchange rates (from observable forward exchange rates at the end of the reporting period)
 
•  Increases (decreases) in the forward exchange rate increase (decrease) fair value
 
 
 
 
 
 
•  Discount rate
 
•  Increases (decreases) in discount rate decrease (increase) fair value
The following table presents the change in the balance of financial assets and liabilities classified as Level 3 as at December 31, 2017 and 2016:
 
Financial 
Assets 
 
Financial 
Liabilities 
FOR THE YEARS ENDED DEC. 31
(MILLIONS)
2017

 
2016

 
2017

 
2016

Balance, beginning of year
$
1,739

 
$
1,691

 
$
1,449

 
$
1,261

Fair value changes in net income
(313
)
 
(102
)
 
(2
)
 
48

Fair value changes in other comprehensive income1
5

 
(12
)
 
67

 
35

Additions, net of disposals
(562
)
 
162

 
749

 
105

Balance, end of year
$
869

 
$
1,739

 
$
2,263

 
$
1,449


1.
Includes foreign currency translation
The significant unobservable inputs (Level 3) included in the discounted cash flow models used when determining the fair value of standing timber and agricultural assets include:
Valuation Techniques
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows
 
•    Increases (decreases) in future cash flows increase (decrease) fair value

 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows


 
 
•    Timber / agricultural prices

 
•    Increases (decreases) in price increase (decrease) fair value

 
•    Increases (decreases) in price tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from price

 
 
•    Discount rate/terminal
capitalization rate

 
•    Increases (decreases) in discount rate or terminal capitalization rate decrease (increase) fair value
 
•    Decreases (increases) in discount rates or terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from rates
 
 
•    Exit Date

 
•    Increases (decreases) in exit date decrease (increase) fair value

 
•    Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

The following table summarizes the key valuation metrics of the company’s investment properties:
 
2017
 
2016
AS AT DEC. 31
Discount Rate

 
Terminal Capitalization Rate

 
Investment Horizon (years)
 
Discount Rate

 
Terminal Capitalization Rate

 
Investment Horizon (years)
Core office
 
 
 
 
 
 
 
 
 
 
 
United States
7.0
%
 
5.8
%
 
13
 
6.8
%
 
5.6
%
 
12
Canada
6.1
%
 
5.5
%
 
10
 
6.2
%
 
5.5
%
 
10
Australia
7.0
%
 
6.1
%
 
10
 
7.3
%
 
6.1
%
 
10
Europe
n/a

 
n/a

 
n/a
 
6.0
%
 
5.0
%
 
12
Brazil
9.7
%
 
7.6
%
 
7
 
9.3
%
 
7.5
%
 
10
Opportunistic and other
 
 
 
 
 
 
 
 
 
 
 
Opportunistic office
9.7
%
 
6.9
%
 
8
 
9.9
%
 
7.6
%
 
7
Opportunistic retail
9.0
%
 
8.0
%
 
10
 
10.2
%
 
8.1
%
 
12
Industrial
6.8
%
 
6.2
%
 
10
 
7.4
%
 
6.6
%
 
10
Multifamily
4.8
%
 
n/a

 
n/a
 
4.9
%
 
n/a

 
n/a
Triple net lease
6.4
%
 
n/a

 
n/a
 
6.1
%
 
n/a

 
n/a
Self-storage
5.8
%
 
n/a

 
n/a
 
6.2
%
 
n/a

 
n/a
Student housing
5.8
%
 
n/a

 
n/a
 
5.9
%
 
n/a

 
n/a
Manufactured housing
5.8
%
 
n/a

 
n/a
 
n/a

 
n/a

 
n/a
Other investment properties
5.8
%
 
n/a

 
n/a
 
5.4
%
 
n/a

 
n/a
Significant unobservable inputs (Level 3) are utilized when determining the fair value of investment properties. The significant Level 3 inputs include:

Valuation Technique
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows – primarily driven by net operating income




 
•    Increases (decreases) in future cash flows increase (decrease) fair value
 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
 
 
•    Discount rate
 
• Increases (decreases) in discount rate decrease (increase) fair value
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
 
 
•    Terminal capitalization rate

 
• Increases (decreases) in terminal capitalization rate decrease (increase) fair value
 
•    Decreases (increases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization rates
The significant Level 3 inputs include:
Valuation Technique
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
 Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows – primarily driven by future electricity price assumptions

 
•    Increases (decreases) in future cash flows increase (decrease) fair value

 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
 
 
•    Discount rate
 
•    Increases (decreases) in discount rate decrease (increase) fair value
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates

 
 
•    Terminal capitalization rate

 
•    Increases (decreases) in terminal capitalization rate decrease (increase) fair value

 
•    Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization rates
 
 
•    Exit date

 
•    Increases (decreases) in the exit date decrease (increase) fair value

 
•    Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
Valuations utilize significant unobservable inputs (Level 3) when determining the fair value of infrastructure’s utilities, transport and energy assets. The significant Level 3 inputs include:
Valuation Technique
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
 Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows
 
•    Increases (decreases) in future cash flows increase (decrease) fair value

 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
 
 
•    Discount rate
 
•    Increases (decreases) in discount rate decrease (increase) fair value
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
 
 
•    Terminal capitalization multiple
 
•    Increases (decreases) in terminal capitalization multiple increases (decreases) fair value
 
•    Increases (decreases) in terminal capitalization multiple tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from terminal capitalization multiple
 
 
•    Investment horizon
 
•    Increases (decreases) in the investment horizon decrease (increase) fair value
 
•    Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
Valuation Technique
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
 Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows – primarily driven by avoided cost or future replacement value
 
•    Increases (decreases) in future cash flows increase (decrease) fair value
 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
 
 
•    Discount rate
 
•    Increases (decreases) in discount rate decrease (increase) fair value
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
 
 
•    Investment horizon
 
•    Increases (decreases) in the investment horizon decrease (increase) fair value
 
•    Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year

Key valuation metrics of the company’s utilities, transport, energy and sustainable resources assets at the end of 2017 and 2016 are summarized below.
 
Utilities
 
Transport
 
Energy
 
Sustainable Resources
AS AT DEC. 31
2017
 
2016
 
2017
 
2016
 
2017

 
2016
 
2017
 
2016
Discount rates
7 – 12%
 
7 – 12%
 
10 – 15%
 
10 – 17%
 
12 – 15%

 
9 – 14%
 
5 – 8%
 
6%
Terminal capitalization multiples
7x – 21x
 
7x – 18x
 
9x – 14x
 
8x – 14x
 
8x – 13x

 
10x – 12x
 
n/a
 
n/a
Investment horizon / Exit date(years)
10 – 20
 
10 – 20
 
10 – 20
 
10 – 20
 
10

 
10
 
3 – 30
 
3 – 30
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Valuations utilize significant unobservable inputs (Level 3) when determining the fair value of sustainable resources assets. The significant Level 3 inputs include:
Valuation Technique
 
Significant Unobservable Inputs
 
Relationship of Unobservable Inputs to Fair Value
 
 Mitigating Factors
Discounted cash flow analysis
 
•    Future cash flows – primarily driven by avoided cost or future replacement value
 
•    Increases (decreases) in future cash flows increase (decrease) fair value
 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in fair value from cash flows
 
 
•    Discount rate
 
•    Increases (decreases) in discount rate decrease (increase) fair value
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in fair value from discount rates
 
 
•    Investment horizon
 
•    Increases (decreases) in the investment horizon decrease (increase) fair value
 
•    Increases (decreases) in the investment horizon tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
This valuation utilizes the following significant unobservable inputs:
Valuation Technique
 
Significant Unobservable Input(s)
 
Relationship of Unobservable Input(s) to Fair Value
 
Mitigating Factor(s)
Discounted cash flow models
 
•    Future cash flows

 
•    Increases (decreases) in future cash flows increase (decrease) the recoverable amount

 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
 
 
•    Discount rate

 
•    Increases (decreases) in discount rate decrease (increase) the recoverable amount

 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates

 
 
•    Terminal capitalization rate

 
•    Increases (decreases) in terminal capitalization rate decrease (increase) the recoverable amount
 
•    Increases (decreases) in terminal capitalization rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates

 
 
•    Exit date

 
•    Increases (decreases) in the exit date decrease (increase) the recoverable amount
 
•    Increases (decreases) in the exit date tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
The recoverable amounts used in goodwill impairment testing are calculated using discounted cash flow models based on the following significant unobservable inputs:
Valuation Technique
 
Significant Unobservable Input(s)
 
Relationship of Unobservable Input(s) to Fair Value
 
Mitigating Factor(s)
Discounted cash flow models
 
•    Future cash flows
 
•    Increases (decreases) in future cash flows increase (decrease) the recoverable amount
 
•    Increases (decreases) in cash flows tend to be accompanied by increases (decreases) in discount rates that may offset changes in recoverable amounts from cash flows
 
 
•    Discount rate
 
•    Increases (decreases) in discount rate decrease (increase) the recoverable amount
 
•    Increases (decreases) in discount rates tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from discount rates
 
 
•    Terminal capitalization rate/multiple
 
•    Increases (decreases) in terminal capitalization rate/multiple decrease (increase) the recoverable amount
 
•    Increases (decreases) in terminal capitalization rates/multiple tend to be accompanied by increases (decreases) in cash flows that may offset changes in recoverable amounts from terminal capitalization rates
 
 
•    Exit date/terminal year of cash flows
 
•    Increases (decreases) in the exit date/terminal year of cash flows decrease (increase) the recoverable amount
 
•    Increases (decreases) in the exit date/terminal year of cash flows tend to be the result of changing cash flow profiles that may result in higher (lower) growth in cash flows prior to stabilizing in the terminal year
Schedule of significant unobservable inputs
Key valuation metrics of the company’s hydro, wind and solar generating facilities at the end of 2017 and 2016 are summarized below.
 
North America
 
Brazil
 
Colombia
 
Europe
AS AT DEC. 31
2017
 
2016
 
2017

 
2016

 
2017

 
2016
 
2017
 
2016
Discount rate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Contracted
4.9 – 6.0%
 
4.8 – 5.5%
 
8.9
%
 
9.2
%
 
11.3
%
 
n/a
 
4.1 – 4.5%
 
4.1 – 5.0%
Uncontracted
6.5 – 7.6%
 
6.6 – 7.2%
 
10.2
%
 
10.5
%
 
12.6
%
 
n/a
 
5.9 – 6.3%
 
5.9 – 6.8%
Terminal capitalization rate1
6.2 – 7.5%
 
6.3 – 6.9%
 
n/a

 
n/a

 
12.6
%
 
n/a
 
n/a
 
n/a
Exit date
2037
 
2036
 
2032

 
2031

 
2037

 
n/a
 
2031
 
2031

1.
Terminal capitalization rate applies only to hydroelectric assets in in North America and Colombia
Schedule of power generating assets
Key assumptions on contracted generation and future power pricing are summarized below:
 
Total Generation Contracted under Power Purchase Agreements
 
Power Prices from Long-Term Power Purchase Agreements
(weighted average)
 
Estimates of Future Electricity Prices
(weighted average)
AS AT DEC. 31, 2017
1 – 10 years
 
11 – 20 years
 
1 – 10 years
 
11 – 20 years
 
1 – 10 years
 
11 – 20 years
North America (prices in US$/MWh)
35
%
 
15
%
 
95

 
100

 
60

 
114

Brazil (prices in R$/MWh)
66
%
 
57
%
 
274

 
407

 
309

 
458

Colombia (prices in COP$/MWh)
17
%
 
—
%
 
211,000

 
—

 
238,000

 
339,000

Europe (prices in €/MWh)
78
%
 
35
%
 
90

 
107

 
78

 
95