Aidan Kelly

Aidan Kelly asked for insights into the form of commitments being made for the Texas load pipeline, specifically inquiring about the amount of Letters of Agreement (LOAs) versus other types of commitments.

Answer

Jeff Martin, Chairman and Chief Executive Officer of Sempra, and Allen Nye, Chief Executive Officer of Oncor Electric Delivery, explained the evolution of commitments. Allen Nye detailed the shift from high confidence load and officer letters to current processes like Batch Zero and ERCOT's 2026 Regional Transmission Project criteria. He noted that 38 GW of load currently meet these standards (requiring financial commitment, site control, upfront study costs, generation disclosure, and active project identification). He also highlighted that Oncor holds approximately $3.5 billion in collateral from customers, indicating significant interest.

Aidan Kelly asked for insights into the form of commitments being made in the Texas load pipeline, specifically inquiring about the amount of Letters of Agreement (LOAs) versus other types of commitments.

Answer

Jeff Martin (Chairman and CEO, Sempra) highlighted Oncor's process for high certainty load. Allen Nye (CEO, Oncor Electric Delivery) detailed the evolution of commitments, including 9 GW of formally signed facilities extension agreements and interim FEAs requiring $6.5 million collateral. He noted 38 GW currently meet criteria for the ERCOT 2026 RTP filing, expected to increase, and emphasized the growth in customer collateral from $200 million in 2018 to $3.5 billion today, indicating serious interest.

Aidan Kelly asked for more details on the Los Angeles District Attorney's investigation into the Eaton Fire to determine if criminal violations occurred, and how Edison International views the scope and potential magnitude of this investigation.

Answer

Pedro Pizarro, President and CEO of Edison International, confirmed that the idle transmission line was grounded at both ends, but photographic evidence at the far end showed anomalies and potential issues with that grounding. He noted that there is no common industry practice for grounding idle lines and that, in an abundance of caution, SCE changed its protocols to require grounding at endpoints and at least every two miles for longer lines, or shorter depending on topography.

Aiden Kelly inquired about the breakdown of Edison International's near-term annual 1%-3% sales growth, specifically detailing the contributions from electrification, residential growth, and commercial and industrial (C&I) customers.

Answer

Steven Powell (President and CEO, Southern California Edison) explained that electrification, primarily driven by strong zero-emission vehicle purchases, accounts for about one-third of the load growth. He added that residential new home starts and development are another key contributor, alongside broad commercial and industrial growth spanning defense, manufacturing, logistics, and moderate data center requests, highlighting a balanced and diverse load profile.

Aiden Kelly asked for more details on the near-term annual 1-3% sales growth, specifically the breakdown between electrification, residential growth, and commercial and industrial (C&I) customers.

Answer

Steven Powell (President and CEO, Southern California Edison) explained that electrification, primarily from strong zero-emission vehicle purchases, drives about a third of the load growth. Residential new home starts and diverse commercial/industrial growth (defense, manufacturing, logistics, moderate data centers) contribute to a balanced load profile over the next five years. Pedro Pizarro (President and CEO, Edison International) added that this diverse profile provides durability.

Aidan Kelly from JPMorgan Chase & Co. asked about the delays in securing ESAs for large load customers, specifically regarding land considerations for Sabey, and whether these issues might affect other prospective data centers like Atlas. He also inquired about the factors offsetting potential share dilution from the 50% equity funding for the South Dakota plant, which supports the reaffirmed 4%-6% EPS CAGR.

Answer

President and CEO Brian Bird acknowledged past delays in ESAs, noting that developers sometimes need to secure customers before signing. He expressed confidence in the progress with Sabey, Atlas, and Quantica despite national and local challenges. CFO Crystal Lail explained that the South Dakota generation investment, which recovers cash during construction through a phase-in rate plan rider, is the type of accretive incremental CapEx that helps maintain or push upward on the earnings range, allowing for 50/50 debt-to-equity funding while supporting the EPS CAGR.

Aidan Kelly from JPMorgan Chase & Co. asked about the delays in signing Energy Service Agreements (ESAs) for large load customers, specifically inquiring if land considerations affecting Sabey are impacting other prospective loads like Atlas, and what is needed to finalize these development agreements.

Answer

Brian Bird (President and CEO, NorthWestern Energy) acknowledged past delays, noting that sometimes the utility was the holdup, but now developers face challenges like land issues (Sabey) or the need to secure customers. He expressed confidence in the current progress with the three potential data center providers. Crystal Lail (CFO, NorthWestern Energy) then addressed the growth outlook, explaining that the incremental generation investment in South Dakota, which recovers cash during construction and has a phase-in rate plan, is the type of accretive capital expenditure that supports maintaining or pushing upward on the 4%-6% EPS CAGR, despite the need for 50% equity funding for this specific project.

Aidan Kelly of JPMorgan Chase & Co. inquired about the timeline for converting data center Letters of Intent (LOIs) to Energy Service Agreements (ESAs), potential gating items, and strategies for meeting load requirements if demand surpasses current capacity. He also asked for a geographic breakdown of the nine data center requests between Montana and South Dakota.

Answer

CEO Brian Bird stated that he expects at least one, and possibly both of the initial two, LOIs to become signed ESAs by the October earnings call. To address future demand, he explained that NorthWestern Energy is exploring build-own-transfer options for new generation with the data center partners, which could be regulated at either the state or federal level. He also clarified that the nine initial requests are split roughly evenly between Montana and South Dakota.

Aidan Kelly of JPMorgan Chase & Co. inquired about the potential timing for signing Energy Service Agreements (ESAs) for the three data centers under LOIs, how NorthWestern plans to address load requirements if demand exceeds existing capacity, and the geographic split of the nine data center requests between Montana and South Dakota.

Answer

Brian Bird, President and CEO, stated that he expects at least one, and possibly two, of the LOIs to convert to an ESA by the next earnings call in October. To meet excess demand, he explained the company is exploring build-transfer agreements for new generation with the data center developers, which could be state or FERC-regulated. He also estimated that the nine initial requests are split roughly evenly between Montana and South Dakota.

Aidan Kelly inquired about the expected timeline for converting data center Letters of Intent (LOIs) to Energy Service Agreements (ESAs), the strategy for meeting load requirements if demand surpasses existing capacity, and the geographical split of the nine initial data center requests.

Answer

CEO Brian Bird projected that at least one ESA would be signed by the next earnings call in October. He explained that to meet excess demand, NorthWestern is exploring build-transfer agreements for new generation with the data centers, which could be pursued on a state-regulated or FERC-regulated basis. He also estimated that the initial nine requests are split roughly evenly between Montana and South Dakota.

Aidan Kelly inquired about the comfort level with 2026 EPS guidance before cost of capital resolution and the potential for energy storage microgrids as a blueprint for high fire-risk communities.

Answer

EVP and CFO Carolyn Burke stated that the company plans conservatively under various scenarios to consistently deliver for customers and investors, despite market choppiness. She also expressed excitement about the CRC energy storage microgrid project, viewing it as a learning opportunity and a blueprint for similar installations in other high fire-risk communities to minimize outages and enhance safety.

Aidan Kelly asked about the company's comfort with 2026 EPS guidance before the cost of capital resolution and the CRC energy storage microgrid as a blueprint for other high fire-risk communities.

Answer

Patti Poppe, CEO, affirmed that the company plans conservatively and consistently delivers on its commitments despite various circumstances, ensuring reliability for customers and investors. She expressed excitement about the CRC energy storage microgrid project, confirming plans for similar installations in other communities, and highlighted its role in minimizing outages and hardening critical services during public safety power shutoffs.