Nicholas Campanella

Nicholas Campanella asked if Talen Energy still believes it can sign gas contracts with incumbent generation in a front-of-the-meter framework, or if future deals would require additionality and a new build commitment. He also inquired about Talen Energy's EPC relationships and its ability to secure the supply chain for new build projects, referencing Amazon's non-additionality comments at the Montour hearing and peers discussing new build gas/turbines.

Answer

Mac McFarland, President and CEO, unequivocally stated that Talen Energy believes it can continue to contract with existing assets, though future contracts may include new build. He clarified that while existing assets are still viable for contracting, new build projects require either a 15-year contract from an RBP award or a PPA to secure financing. Mr. McFarland emphasized that the off-take agreement is the most critical factor, as it attracts investors, turbine suppliers, and EPC providers. He confirmed Talen Energy has relationships and dedicated roles, like the Chief Asset Development Officer, focused on technology, costing, and EPC work.

Nicholas Campanella asked if Talen Energy still believes it can sign gas contracts with incumbent generation in a front-of-the-meter framework, or if new build commitments are now required.

Answer

Mac McFarland, President and CEO, unequivocally stated that Talen believes it can continue to contract with existing assets, though future contracts may also include new build. Regarding new build, he emphasized that an offtake agreement (either a 15-year RBP contract or a bilateral PPA) is the critical factor that attracts investment, turbine orders, and EPC providers, rather than supply chain issues alone. He also highlighted Dale's role as Chief Asset Development Officer focusing on technology, costing, and EPC work.

Nicholas Campanella of Barclays inquired about the recent 75-megawatt performance recovery at the Susquehanna nuclear plant and whether it should be considered an increase to nameplate capacity. He also asked if Talen remains on track for its $500 million share repurchase target for the year.

Answer

CEO Mac McFarland clarified the megawatt gain at Susquehanna is a performance recovery, not a nameplate uprate, with a payback period of under two years. Regarding buybacks, McFarland and CFO Terry Nutt explained that while Q2 activity was limited by M&A, the company remains committed to its capital return policy, targeting $500 million in annual repurchases during the post-acquisition deleveraging period through 2026.

Nicholas Campanella of Barclays asked about the recent 75-megawatt increase at the Susquehanna nuclear plant and its impact on nameplate capacity. He also inquired about the progress of the share repurchase program and whether Talen Energy is on track to meet its $500 million annual target.

Answer

CEO Mac McFarland explained the megawatt gain at Susquehanna was a recovery from maintenance, not a formal capacity uprate, though uprates are being explored separately. Regarding buybacks, McFarland and CFO Terry Nutt noted that M&A activity limited Q2 repurchases but reaffirmed their commitment to returning capital. They are targeting $500 million in annual share repurchases during the post-acquisition deleveraging period, followed by a 70% return of capital once leverage targets are achieved.

Nicholas Campanella asked about Sempra's strategy for seeking the lowest-cost financing for CapEx, specifically regarding the remaining 25% stake in Sempra Infrastructure (SI) and its potential use to fund the $9 billion upside or other strategic actions to limit common equity.

Answer

Jeff Martin, Chairman and Chief Executive Officer of Sempra, reiterated the focus on a robust growth story and a solid financing plan for the base capital. For upside opportunities, he pointed to the $5 billion increase in internally generated cash flows, $2.2 billion of additional proceeds from the SI transaction expected post-2030, and Sempra's demonstrated track record of capital recycling. He confirmed the 25% residual interest in SI remains a potential funding opportunity, emphasizing the commitment to efficient capital sourcing and competing capital.

Nicholas Campanella asked about the factors preventing Sempra from accelerating beyond the $7.50 high end of its 2030 guidance, despite significant capital acceleration and other accretive factors. He also questioned the strategic use of the remaining 25% stake in Sempra Infrastructure Partners (SIP) or other actions to fund the $9 billion upside and limit common equity issuances.

Answer

Jeff Martin (Chairman and CEO, Sempra) cited a $5 billion increase in projected internally generated cash flows, improved credit quality in California, and 18% rate base CAGR at Oncor as key drivers. He confirmed the 25% SIP stake, $2.2 billion in future SIP proceeds, and capital recycling as potential funding sources for upside opportunities, emphasizing efficient capital sourcing and the removal of execution risks.

Nick Campanella asked about Sempra's balance sheet capacity for increased capital expenditures, specifically inquiring if the company anticipates no equity issuances through 2027, and also sought an update on the Texas base rate review schedule and the likelihood of a settlement.

Answer

Jeff Martin, Chairman and CEO of Sempra, confirmed that proceeds from the Sempra Infrastructure transaction are expected to eliminate 100% of previously planned common equity needs through 2029, fortifying the balance sheet for future growth. Karen Sedgwick, EVP and CFO, added that rating agencies are giving time to complete the SI transaction, expecting improved credit profiles and a solid cushion on the balance sheet. Allen Nye, CEO of Oncor, provided an update on the Texas base rate review, noting ongoing settlement discussions while preparing for a hearing on November 17th, with an order expected in Q2 2026.

Nick Campanella asked about Sempra's balance sheet capacity and equity needs through 2027, given the recent Sempra Infrastructure (SI) transaction and the higher capital expenditure outlook for Oncor. He also inquired about the likelihood of a settlement in the Texas base rate review process.

Answer

Jeff Martin (Chairman and CEO, Sempra) stated that SI transaction proceeds are expected to eliminate 100% of common equity previously in the 2025-2029 financing plan, fortifying the balance sheet for future growth. Karen Sedgwick (EVP and CFO, Sempra) confirmed expected EPS accretion, deconsolidation of SI's debt, and improved credit profiles. Allen Nye (CEO, Oncor) confirmed active settlement discussions for the Texas base rate review while preparing for a hearing, noting confidence in their case and interim rates effective January 1, 2026.

Nicholas Campanella from Barclays asked for details on the Sempra Infrastructure stake sale process, specifically the ROFR extension terms, and inquired about Sempra's engagement on California legislative issues, including the AB 1054 wildfire fund and customer affordability bills.

Answer

Chairman, President & CEO Jeffrey Martin clarified the ROFR extension is designed to provide adequate time for a transaction. On California policy, Martin expects progress on stabilizing the AB 1054 framework. EVP Caroline Winn highlighted SDG&E's industry-leading wildfire mitigation program, now in its 18th year without a major utility-caused fire. Regarding affordability, management emphasized their focus on immediate bill relief, such as passing on tax credits and advocating for moving public purpose program costs off customer bills.

Nicholas Campanella questioned the prudence of a plan where a 1% increase in the rate base growth rate corresponds with a significant cut to near-term EPS expectations. He also asked for clarification on the company's equity financing needs, including the potential for a block sale and the strategy of issuing shares while also planning for repurchases within the same 5-year plan.

Answer

CEO Jeffery Martin defended the strategy, stating that Sempra is positioning for higher long-term sustained growth of 7-9%, with an expected CAGR of 9% or more through 2029. He highlighted a $12 billion pipeline of additional, un-booked capital opportunities at Oncor as a key upside driver. Regarding financing, Martin emphasized that operating cash flow is the primary source, supplemented by the ATM program and potential asset sales at Sempra Infrastructure, with a net equity need of $2-3 billion anticipated.

Nicholas Campanella asked if Sempra has line of sight to an EPS growth rate above its 6% to 8% CAGR, given the significant demand growth and capital opportunities. He also inquired about the timing of equity needs related to the new $3 billion at-the-market (ATM) program.

Answer

Jeffery Martin, Chairman and Chief Executive Officer, responded that while the utility sector's EPS growth is expected to trend higher, Sempra remains comfortable with its 6% to 8% range, which balances growth with a strong dividend policy, though they will work to exceed the high end. Regarding the ATM, he positioned it as an additional financing tool, stating that a full update on the capital program and its funding sources would be provided on the Q4 call in February.

Nicholas Campanella with Barclays inquired about H2O America's non-linear 6%-8% EPS CAGR, specifically when the company expects to achieve the 8%+ growth level given anticipated financing and ROE lag in 2026-2027. He also asked about the timeline for future M&A opportunities, whether the company would wait until after the Texas rate case, and where the best M&A prospects lie within or outside current jurisdictions.

Answer

Anne P. Kelly, CFO, explained that the company is respectful of the PUCT process, and the outcome of the consolidated Texas rate case will be a key driver for 2028 earnings and beyond, forecasting accretion in 2028. Andrew Walters, CEO, clarified that the company's focus is on completing the Quadvest acquisition in the near to medium term, noting that typical acquisitions are smaller tuck-ins, and they do not comment on specific future transactions.

Nicholas Campanella asked for clarification on the non-linear 6%-8% EPS CAGR, specifically when H2O America expects to reach the 8%+ growth level, potentially by 2028, given the anticipated financing and ROE lag in 2026 and 2027. He also inquired about the timeline for future M&A opportunities, asking if the company would wait until after the Texas rate case or remain active across jurisdictions, and where the best opportunities might lie.

Answer

Ann Kelly, Chief Financial Officer, stated that the company needs to be respectful of the PUCT process, as the outcome of the consolidated Texas rate case will be a key driver for earnings in 2028 and beyond. She confirmed that accretion is forecasted for 2028 versus the standalone plan and that H2O America expects to be at or above the top end of the 6%-8% range for the total period. Andrew Walters, CEO, explained that the velocity of acquisitions in the water space is not regular, with typical acquisitions being small tuck-ins, which the company will continue to pursue. He emphasized that the current focus is on completing the Quadvest acquisition for the near and medium term, declining to comment on specific future transactions.

Nicholas Campanella followed up on the $2.5 billion EBITDA potential, seeking updated insights on the target price for new data center contract signings (previously above $80/MWh). He also asked if new build projects would affect share repurchases and about the targeted equity contribution for such projects.

Answer

President Robert Gaudette indicated that target prices for new GEV turbine contracts would be in the $90-$95+ range to ensure adequate returns. CFO Bruce Chung clarified that NRG prefers corporate-style balance sheet financing over project financing for new builds, aligning capitalization with the 3x leverage target, and does not anticipate significant pressure on near-term buybacks.

Nicholas Campanella sought clarification on the target price for new data center signings, specifically how it underpins the projected $2.5 billion in EBITDA. He also inquired about the potential impact of new build projects on share repurchases, asking about targeted equity contributions and financing strategies.

Answer

President Robert Gaudette indicated that the target price for signings has been adjusted to an $80+ per megawatt-hour range, with 1.2 GW GEV turbines potentially commanding north of $90-$95, ensuring returns cover equipment and capital. CFO Bruce Chung emphasized NRG's preference for corporate-style balance sheet financing over project financing for simplicity and transparency, aligning capitalization with the corporate 3x leverage target.

Nick Campanella from Barclays asked about the evolution of "build-your-own-power" (BYOP) conversations with policymakers and customers, particularly regarding the necessity of additionality for future deals. He also inquired about the PJM capacity auction, the prospects for extending the cap and collar, and NRG's advocacy for industry outcomes.

Answer

Larry Coben, Chair, President, and CEO, explained that policymakers are increasingly favoring BYOP due to affordability and infrastructure needs, aiming to distribute costs more broadly. He noted this trend, anticipated by NRG's GE Vernova and KeyWatt joint venture, is accelerating. Rob Gaudette, EVP, commented on the PJM capacity auction, stating that supply and demand dynamics suggest pricing at the top of the cap and collar. He indicated support for extending the collar for market certainty, while acknowledging ongoing discussions about its appropriate level.

Nick Campanella asked about the evolution of 'bring-your-own-power' (BYOP) discussions with policymakers and customers, the potential for additionality as a requirement, and the prospects for extending the PJM capacity auction collar.

Answer

Larry Coben, Chair, President, and CEO of NRG Energy, explained that BYOP is accelerating due to policymakers' focus on affordability and cost distribution, making it a fair solution. Rob Gaudette, EVP, added that PJM supply/demand remains unchanged, expecting pricing at the cap, and NRG supports extending the collar for market certainty, though the top end's appropriateness is still being determined.

Nicholas Campanella of Barclays asked about the company's line of sight for converting its 4 GW data center backlog into firm agreements and the expected timing for future announcements. He also questioned the potential for launching a Virtual Power Plant (VPP) offering in the PJM market, given the success in Texas.

Answer

Chairman, CEO and President Larry Coben stated that providing a specific timeline for converting letters of intent is difficult due to external factors like interconnection studies. On the VPP topic, he explained that while the Texas launch has been very successful, the company wants to analyze the results more thoroughly before considering an expansion into PJM, which is not expected in 2025.

Nicholas Campanella asked for clarification on the Coastal Virginia Offshore Wind (CVOW) project's turbine installation progress, specifically the required turbines per quarter to meet the July 2027 timeline. He also inquired if financing partners would participate in potential budget upside and the impact of installation delays on the overall Commercial Operation Date (COD).

Answer

Robert M. Blue stated that the expectation is to install the majority of turbines in 2026 and some into 2027, aiming for approximately 2.25 days per installation over time. He confirmed that Stonepeak is a great partner with contractual provisions for moving forward if the project extends beyond the expected timeline. Steven Ridge added that regulatory recovery for capital is largely fixed, and changes in installation would be largely EPS neutral due to deferrals, with cash impacts absorbed by robust credit cushions.

Nicholas Campanella asked for clarification on the Coastal Virginia Offshore Wind (CVOW) project's turbine installation cadence needed to meet the July 2027 timeline, the per-quarter cost sensitivity if the project extends beyond that date, and if financing partners would participate in budget upside risk. He also questioned if the overall Commercial Operation Date (COD) would slip if installation extends past July 2027.

Answer

CEO Bob Blue stated that the expectation is to install the majority of turbines in 2026 and some in 2027, aiming for approximately 2.25 days per installation, acknowledging slower progress in winter. He confirmed Stonepeak's partnership and contractual provisions for extensions. CFO Steven Ridge added that regulatory recovery mechanisms mean capital in the rate base is largely fixed, making installation changes largely EPS neutral, with a robust credit cushion for cash impacts. Bob Blue clarified that COD is achieved as turbines come online in strings, not a single end date.

Nicholas Campanella inquired about the Coastal Virginia Offshore Wind (CVOW) project, seeking details on the schedule's flexibility for the 'Charybdis' installation vessel and overall confidence in the timeline. He also asked about Dominion's financial standing within its 2025 guidance range and the long-term EPS outlook considering recent positive developments.

Answer

President, CEO & Chairman Robert Blue expressed high confidence in the CVOW schedule, clarifying the vessel will arrive in August and begin turbine installation in September, which is on schedule. He emphasized that the purpose-built vessel significantly de-risks the installation process. EVP & CFO Steven Ridge stated that while performance is trending toward the top half of the 2025 guidance range, the company will wait for Q3 results before narrowing the range. Regarding the long-term outlook, both executives reiterated a focus on consistent execution of the existing plan, with Ridge adding that the 45Z RNG tax credit will likely continue to be reported separately for transparency.

Nicholas Campanella inquired about supplier confidence for the Coastal Virginia Offshore Wind (CVOW) project amid potential tariff impacts and asked for an update on the expected installation run rate for monopiles.

Answer

Robert Blue, Chair, President and CEO, expressed high confidence in suppliers, noting that Siemens Gamesa is on schedule and performing well. Diane Leopold, EVP and COO, added that raw materials are purchased and fabrication is on or ahead of schedule. Regarding installation, Mr. Blue confirmed the monopile season began that day and they expect to maintain a pace of about 25 installations per month, weather permitting.

Nicholas Campanella asked if the large increase in data center demand is incremental to PJM's forecast and about the timeline to incorporate this into the capital plan. He also questioned the prospects for contracting the remaining output from the Millstone nuclear plant and the importance of 'additionality' for potential customers.

Answer

Chair, President & CEO Robert Blue confirmed the gigawatts in the initial 'substation engineering' phase are not yet in the PJM forecast. He stated there is no simple capital-per-gigawatt rule but noted significant transmission is already planned to support growth. Regarding Millstone, Blue said that for potential large customers, 'additionality' is not an essential gating item. He affirmed that Dominion continues to explore options with data centers and states but has no set timeline, emphasizing any deal must consider Connecticut stakeholder interests.

Nicholas Campanella inquired about the expanded opportunity set for the Millstone nuclear plant, including data centers and potential uprates, and asked how incremental capital from the IRP and transmission projects might impact the company's rate base growth.

Answer

CEO Robert Blue confirmed they are studying potential uprates at Millstone and exploring options for contracted procurement and a data center location, but noted it is early. Blue reiterated that the focus is on consistent execution of the March 1 plan, though opportunities could extend growth later in the plan. CFO Steven Ridge added that the capital plan has an upward bias for the back end of the 2025-2029 period and that any new capital will be financed to preserve the balance sheet's strength.

Nicholas Campanella asked for details on the QTS data center relocation to Iowa, specifically regarding permitting, zoning approval, and the path to construction, including the upcoming tariff filing. He also sought clarity on the timing goals for securing additional 2-4 GW large load opportunities.

Answer

Lisa Barton, President and CEO, clarified that an Individual Customer Rate (ICR) filing would be made for the QTS relocation. She emphasized the team's agility in pivoting to a new Iowa site with similar demand, timing, and ramp rates, noting the land is controlled and zoned industrial. Regarding future growth, Ms. Barton outlined three categories of opportunities (expansions, existing customers in new locations, new customers in new locations) and stressed the importance of high-quality Electric Service Agreements (ESAs) based on clear project timing, load details, generation needs, transmission studies, and land control.

Nicholas Campanella asked about the permitting, zoning, and approval process required for the relocated QTS data center in Iowa, and the path to construction, including the expected tariff filing. He also inquired about the timing goals for bringing in another deal from the 2-4 GW of additional large load growth opportunities.

Answer

Lisa Barton (CEO, Alliant Energy) clarified that an Individual Customer Rate (ICR) filing would be made for the QTS project. She highlighted the team's ability to pivot quickly, noting the new Iowa site has similar demand and timing, with land control and industrial zoning already in place. Regarding the 2-4 GW opportunities, she explained they fall into three buckets: expansion at existing sites, existing customers in new locations, and new customers in new locations, emphasizing the high bar for quality Electric Service Agreements (ESAs) based on clear timing, peak load, ramp rates, generation needs, transmission studies, and land control.

Nicholas Campanella inquired about the progress and line of sight for the 2 GW-4 GW incremental load opportunities, the FFO to debt projections through 2026, the sustainability of tax credits through 2030, and the embedded load growth starting point for 2026.

Answer

Lisa Barton (President and CEO) highlighted active negotiations for near-term, less transmission-dependent opportunities with high confidence, promising transparent updates. Robert Durian (EVP and CFO) stated an FFO to debt target of 50-100 basis points cushion, confirmed $1.5 billion-$1.6 billion in tax credits over four years, and noted modest load growth in 2026, ramping up through 2030.

Nicholas Campanella with Barclays asked for more details on the 2-4 gigawatts of additional load opportunities, including their stage of development and the likelihood of new contracts in 2026. He also inquired about the company's FFO to debt targets through 2026, the sustainability of tax credits beyond 2026, and the embedded load growth starting point for 2026.

Answer

Lisa Barton, President and CEO, stated that the 2-4 gigawatts represent active negotiations for near-term, less transmission-dependent opportunities, with high confidence and a clear line of sight expected within the next 12 months, potentially leading to growth above 8%. Robert Durian, Executive Vice President and CFO, indicated a target FFO to debt cushion of 50-100 basis points to support future growth, confirmed approximately $1.5-$1.6 billion in tax credits over the next four years, and explained that 2026 load growth is modest, with significant ramp-up expected in the second half of 2026 and continuing through 2030.

Nicholas Campanella from Barclays asked if the capital required for new generation is truly incremental to the five-year plan or if it would displace other projects. He also followed up on the financing strategy, asking for the target equity percentage for this incremental capital.

Answer

Executive VP and CFO Robert Durian confirmed that capital for new data center load should be viewed as incremental to the current plan and will not displace existing projects. He reiterated the company's financing strategy, stating that any incremental capital expenditure would be funded with approximately 40% to 50% new common equity.

Nicholas Campanella from Barclays asked for an update on the company's 5-7% long-term EPS CAGR target given the increased capital plan and new equity. He also questioned how much equity might be needed if tax credit transferability were eliminated.

Answer

Executive Robert Durian stated he would be disappointed if the company did not achieve the top end of its 5-7% EPS growth range starting in 2027. He noted that over 95% of tax credits in the four-year plan are already secured through in-service projects or safe harboring, minimizing near-term risk. If new financing were required, it would likely include 40-50% equity to maintain a strong balance sheet. Executive Lisa Barton highlighted the "Alliant Energy Advantage" and recent political support for the IRA as positive factors.

Nicholas Campanella inquired about the equity financing needs associated with incremental capital expenditures and the company's current FFO to debt trends. He also asked for details on what might be different in the upcoming Wisconsin rate review compared to prior cases.

Answer

EVP and CFO Robert Durian explained that new capital additions are expected to be financed with approximately 45-50% equity. He highlighted a 35% increase in 2024 cash from operations, driven by tax credit monetization and improved cost recoveries, and noted improving working capital management. Regarding the Wisconsin rate case, Durian stated it will be predominantly driven by approved rate base additions from recent solar, battery, and advanced gas projects, with typical issues like ROE and capital structure being the focus.

Nicholas Campanella asked about Southern Company's updated long-term earnings outlook, specifically how the company is trending beyond 2028, considering potential upside from Southern Power's repricing, and the generation sourcing strategy for the 3 GW of near-term load.

Answer

Christopher C. Womack, Chairman, President and CEO, highlighted the company's disciplined approach and confidence in the 10 GW of projects under execution, 3 GW in final stages, and a 75 GW pipeline, supporting the updated outlook. David P. Poroch, CFO, added that the guidance is a target they aim to exceed, with opportunities for upside. Womack also noted an 'all-of-the-above' strategy for generation, including gas, battery storage, and uprate opportunities.

Nicholas Campanella inquired about Southern Company's updated long-term earnings outlook, specifically how the company is trending beyond 2028, the potential upside from Southern Power's repricing, and the generation sourcing strategy (e.g., gas) and associated CapEx for the 3 GW of near-term load.

Answer

Chairman, President, and CEO Christopher C. Womack highlighted the company's disciplined approach and confidence in the revised outlook, citing 10 GW of contracted projects, 3 GW in final stages, 7 GW in late stages, a 75 GW pipeline, and robust economic expansion. He also noted an 'all-of-the-above strategy' for generation, including gas, battery storage, and uprates. CFO David P. Poroch added that the guidance represents a target, with expectations to achieve the top end and potential for even higher results.

Nicholas Campanella of Barclays inquired about the expected returns for new Southern Power investments compared to the regulated business, the current status of discussions around new nuclear generation, and whether the upcoming large load filing would show a pipeline larger than 50 GW.

Answer

David Poroch, SVP & incoming CFO, explained that Southern Power projects are structured to yield returns slightly higher than regulated assets, given their risk profile. CEO Chris Womack stated that the company continues to advocate for new nuclear as essential for meeting future demand but emphasized the need for financial certainty and risk mitigation. Management confirmed a large load update filing is expected in mid-August, followed by an updated load forecast in September.

Nicholas Campanella requested more detail on the potential 2027 EPS rebase, asking if it would be based on achieving the high end of the 5-7% growth range. He also asked for confirmation on the timing of the upcoming Georgia Power rate case filing.

Answer

Chief Financial Officer Dan Tucker clarified that if incremental capital and data center momentum continue, the company could be positioned at the top of its existing EPS growth range in the back half of the plan. If that trajectory proves sustainable, it would provide the opportunity to rebase the starting point for future growth. Chairman, President and CEO Chris Womack confirmed that the Georgia Power rate case filing is on track for early July 2025.

Nicholas Campanella questioned if the significant load growth outlook, now at 36 GW in the pipeline, could lead to a reevaluation of the 5-7% EPS growth target. He also asked about the role of nuclear power, including uprates and relicensing, in the company's future generation mix.

Answer

CFO Dan Tucker responded that the 5-7% growth rate is unlikely to change in the near term as the load growth is a long-term phenomenon. However, he conceded there may be an opportunity to reevaluate the growth rate's starting point in the latter half of the plan. On nuclear, both Tucker and CEO Chris Womack stressed that while it's an option being preserved, significant risk mitigation from the federal government and partners is required before moving forward with new builds.

Nicholas Campanella acknowledged CenterPoint's consistent CapEx increases and asked about the executability, supply chain, and labor constraints for potentially accelerating more capital into the 5-year plan, distinguishing it from the 10-year plan.

Answer

Jason P. Wells, Chair, President, and CEO, explained that new intra-regional transmission capacity will be needed in the first five years due to large loads in new Houston regions, while import lines will impact the latter half of the decade. He expressed confidence in their capacity to accommodate this, citing long-standing relationships for critical equipment and third-party labor, indicating no material or labor constraints.

Nicholas Campanella asked about CenterPoint's ability to accelerate more CapEx into the five-year plan versus the 10-year plan, considering potential constraints like executability, supply chain, and labor availability.

Answer

Jason P. Wells, Chair, President, and CEO, explained that intra-regional transmission capacity will be needed in the first five years, while larger import lines will likely impact the latter half of the decade. He expressed confidence in the company's ability to execute, citing long-standing relationships for critical equipment and labor, and not foreseeing material or labor constraints.

Nick Campanella inquired about the balance sheet capacity derived from the Ohio transaction, specifically regarding FFO-to-debt improvement and the potential for financing with less than the previously assumed 47% equity. He also asked for an update on local feedback and reception to the deal from state leadership.

Answer

CFO Chris Foster explained that the Ohio transaction would initially reduce opco debt by approximately $800 million, resulting in a net benefit of around $400 million to the financial plan. He noted this could allow for additional capital expenditures with less equity. CEO Jason Wells confirmed that reception to the deal has been very supportive, with no anticipated challenges.

Nick Campanella asked about the balance sheet capacity derived from the Ohio transaction, specifically regarding FFO-to-debt improvement and the potential for less than the 47% equity assumption. He also inquired about local feedback and reception to the Ohio Gas LDC sale.

Answer

Chris Foster, CFO, explained that the transaction would initially reduce opco debt by approximately $800 million, resulting in a net benefit of around $400 million to the plan, potentially allowing for additional CapEx with less equity. Jason Wells, CEO, reported that the reception to the Ohio Gas LDC sale has been very supportive, with no anticipated challenges.

Nicholas Campanella from Barclays asked whether new capital plan tailwinds would impact the five-year or ten-year outlook, sought clarification on funding future growth with less than 50% equity, and inquired about what rating agencies need to see to remove the negative outlook.

Answer

CEO Jason Wells indicated an upward bias to CapEx through the end of the decade and well into the next, with the ability to fund incremental CapEx without additional common equity. EVP & CFO Christopher Foster added that an improved operating cash flow profile may allow for an update to the 50/50 equity/debt funding assumption in the Q3 update. Foster also noted that rating agencies are focused on the successful execution of rate cases and storm cost recovery filings, particularly for Hurricane Beryl.

Nicholas Campanella from Barclays asked if new capital spending is skewed to the 5- or 10-year plan, sought clarification on the 50/50 funding mix flexibility, and inquired about what rating agencies need to see to remove the negative outlook.

Answer

CEO Jason Wells confirmed an upward bias for CapEx through this decade and beyond. CFO Chris Foster indicated that a Q3 update will address the funding mix, suggesting improved operating cash flow could allow for less than 50% equity financing. Foster also noted that rating agencies are focused on the successful conclusion of storm cost recovery filings, particularly for Hurricane Beryl, following the completion of all major rate cases.

Nicholas Campanella from Barclays asked about the financing strategy for new capital opportunities, including the preference between equity and asset sales, and questioned the company's philosophy on its 6-8% long-term EPS growth rate ahead of the Q3 update.

Answer

CEO Jason Wells confirmed no new equity is needed for 2025 and that 2026 needs have been partially derisked. He reiterated a 50/50 debt/equity rule for growth CapEx and noted openness to efficient financing options, including potential asset sales given inbound interest in gas LDCs. Regarding EPS growth, Wells highlighted the strong foundation from a 10%+ rate base CAGR and a history of meeting or exceeding guidance, promising more details in Q3.

Nicholas Campanella from Bank of America Corporation sought clarification on the ESA strategy, specifically how a signed ESA would inform the proposed large load tariff in the first half of 2026, and the company's approach to financing incremental CapEx, including whether all future incremental projects would require equity and how materialized ESAs would impact the financing plan.

Answer

President and CEO Brian Bird confirmed that the ESA and tariff would go hand-in-hand to protect customers, with a filing expected by the first half of 2026. CFO Crystal Lail added that while existing tariffs could serve customers, a new tariff demonstrates value to regulators and the public, addressing the national narrative around data centers. She explained that the base capital plan is self-funded, but accretive incremental CapEx, like the Aberdeen Generating Station or large load facilities with cash during construction, would be funded with equity, though no equity issuances are planned for 2026.

Nicholas Campanella from Bank of America sought clarification on the overall Energy Service Agreement (ESA) strategy, specifically whether the first ESA will inform the proposed tariff for all large loads in the first half of the year, and how the financing plan for incremental CapEx, including potential equity needs, would change if ESAs materialize.

Answer

Brian Bird (President and CEO, NorthWestern Energy) confirmed that the ESA and tariff will go hand-in-hand to protect customers, with a plan to file by the first half of 2026. Crystal Lail (CFO, NorthWestern Energy) added that while existing tariffs could technically serve customers, the current national narrative on data centers necessitates transparency with regulators and the public to demonstrate value and fair cost sharing. Regarding financing, Crystal Lail explained that the base capital plan is self-funded, but incremental CapEx like the Aberdeen Generating Station or large load facilities that recover cash during construction and drive growth would be funded with equity (e.g., 50/50 debt-to-equity for Aberdeen), though no equity is planned for 2026, only 2027 and beyond.

Nicholas Campanella of Barclays requested details on the data center load ramp-up, specifically asking if any significant megawatts would come online in 2026. He also asked about the strategy for recovering costs associated with the Colstrip acquisition in 2026 and whether keeping the asset merchant was a possibility.

Answer

CEO Brian Bird responded that any load in 2026 would be minimal and related to construction, with the substantive ramp-up beginning in 2027. CFO Crystal Lail addressed the Colstrip question, explaining that a Q3 filing is planned to recover costs for the Avista portion serving existing customers. For the Puget portion tied to new large loads, she stated the company is preserving options for recovery under either a state-regulated tariff or a FERC-regulated structure to maintain flexibility.

Nicholas Campanella of Barclays inquired about the expected ramp-up of data center megawatts once ESAs are signed and how NorthWestern plans to handle the costs of the Colstrip facility acquisition in 2026, including the possibility of keeping it merchant and the potential impact on the growth rate.

Answer

CEO Brian Bird indicated that any load in 2026 would be minimal, with a more significant ramp-up beginning in 2027. CFO Crystal Lail addressed the Colstrip costs, explaining that the Avista portion is intended for existing customers, with a Q3 filing planned for cost recovery. The Puget portion is targeted for new large loads and could be served on either a Montana-regulated or FERC-regulated basis to maintain flexibility and protect existing customers.

Nicholas Campanella questioned the specific megawatt ramp-up timeline for data centers, asking if any significant load would come online in 2026. He also asked about the plan for handling the costs of the Colstrip facility after its acquisition and whether keeping it merchant was a viable option.

Answer

CEO Brian Bird responded that any 2026 load would be minimal for construction, with the significant ramp beginning in 2027. CFO Crystal Lail explained that the Avista portion of Colstrip is needed for existing customers, and a Q3 filing will address cost recovery. The Puget portion, not required for current regulated load, provides flexibility to serve new data centers under either a state-regulated or FERC-regulated framework.

Nicholas Campanella inquired about the expected timeline for the new data center tariff proceeding in Montana and whether its completion is a prerequisite for announcing further data center agreements. He also asked if NorthWestern expects to achieve its 4% to 6% EPS growth target for 2025, considering the strong first quarter and the partial rate case settlement.

Answer

President and CEO Brian Bird explained that the initial data centers can be served under existing Montana tariffs and detailed a five-stage process for new requests, with two parties in the contractual estimate phase. CFO Crystal Lail added that while future infrastructure might require tariff modifications, the current rate design is sufficient for the initial projects. Regarding 2025 guidance, Lail stated that the company is not providing a specific range until the Montana rate review hearing concludes, noting that long-term growth may not be linear year-to-year.

Nicholas Campanella questioned the rationale for basing the 4-6% long-term growth rate on a depressed 2024 earnings year and asked how potential data center load could impact future growth and tariffs.

Answer

CFO Crystal Lail explained that using 2024 as a base was merely an update to a more current period and affirmed the company's commitment to the 4-6% long-term growth target, expecting to be within that range for 2025. CEO Brian Bird added that achieving 4% growth in 2024 despite headwinds was a positive outcome and that incremental opportunities like data centers would create upward pressure on the growth rate. He also noted the company is open to dialogue with the Montana commission regarding tariffs for new large loads.

Nicholas Campanella asked about the most encouraging aspects of the California Earthquake Authority (CEA) process for SB 254 Phase Two, and the preferred timing for legislative action (June vs. September) given historical patterns and summer recesses.

Answer

CEO Patti Poppe emphasized the importance of taking time to achieve the right outcomes, supporting the CEA's focus on actionable, viable, and durable solutions. She highlighted the need to address the regressive nature of the current construct, focusing on risk reduction, recovery outcomes, affordability, and investability. In a follow-up, Ms. Poppe addressed potential plan re-evaluation if legislative progress stalls, stating that while current performance is strong, all aspects of the plan would be on the table if the state loses interest in SB 254 reform.

Nicholas Campanella asked about the most encouraging aspects of the California Earthquake Authority (CEA) process for SB 254 Phase 2 and the preferred legislative timing (June vs. September). He also inquired about PG&E's capital allocation priorities if legislative progress stalls.

Answer

CEO Patti Poppe emphasized the complexity of the legislative effort, supporting a thorough process to achieve actionable, viable, and durable solutions focused on risk reduction, recovery outcomes, affordability, and investability. Regarding capital allocation, Ms. Poppe reiterated that the current valuation is unsustainable and that all aspects of PG&E's plan would be re-evaluated if progress on SB 254 stops or derails, but currently, strong performance supports the existing plan.

Nicholas Campanella of Barclays inquired about PG&E's willingness to contribute upfront capital to a wildfire fund solution and asked for an update on the company's current balance sheet capacity.

Answer

CEO Patti Poppe stated that a large upfront contribution is unlikely to be necessary because claims are paid out over several years. EVP & CFO Carolyn Burke added that the $63 billion capital plan is fully funded and that the company is re-evaluating the timing of a $2 billion parent debt paydown, likely deferring it past 2026 to add flexibility while still targeting mid-teens FFO to debt.

Nicholas Campanella of Barclays inquired about the company's willingness to consider any upfront funding for a wildfire fund solution and asked for an update on its current balance sheet capacity, including holdco debt flexibility.

Answer

CEO Patti Poppe stated that a large upfront payment is unlikely as claims are paid out over many years. EVP & CFO Carolyn Burke clarified that the $63 billion capital plan is fully funded and that the planned $2 billion parent debt paydown is being deferred beyond 2026, providing added flexibility while still targeting mid-teens FFO to debt by 2028.

Nicholas Campanella inquired about the confidence in achieving a legislative solution for AB 1054 this year and asked about the key differentiators of PG&E's upcoming General Rate Case (GRC) filing compared to state peers.

Answer

CEO Patti Poppe expressed high confidence in a constructive legislative outcome for AB 1054 in 2025, stating it's 'too important not to do' for all stakeholders, though she refrained from detailing specific changes. Regarding the GRC, Poppe highlighted it will reflect their 'simple affordable model,' pass along significant O&M savings, and represent the 'lowest ask in a decade,' noting it conservatively excludes future benefits from the DOE loan, investment-grade ratings, and new load growth.

Nicholas Campanella asked about the risk of AB 1054 reform becoming a protracted, multi-year effort due to competing interests. He also inquired how the recent change in the state's cost of capital might impact PG&E's upcoming cost of capital application.

Answer

CEO Patti Poppe stated the company is not ruling out a 'Stage 1 resolution' this year, as policymakers understand the need to attract investor capital. She acknowledged broader issues exist but believes an incremental fix is possible. Regarding the filing, Poppe confirmed the plan is to file a strong case in March, acknowledging that while the state dislikes wildfire adders, the actual cost of capital has undeniably increased.

Nicholas Campanella asked about the tailwinds supporting Exelon's 5-7% earnings outlook, especially given the 8% rate-based growth and financing lag. He also inquired about the 2026 regulatory strategy for Pennsylvania and Maryland, and the company's advocacy for the PJM RBA process and its potential impact on the September auction.

Answer

Jeanne Jones (CFO) highlighted Exelon's track record of 8% rate base growth and 7.4% earnings growth since 2021, citing AFUDC from transmission capital as a key tailwind. Calvin Butler (President and CEO) emphasized ongoing stakeholder conversations focused on affordability and grid reliability, confirming a Maryland filing this year and consideration for Pennsylvania. Colette Honorable (EVP and CLO) detailed engagement with PJM and regulators, supporting the RBA, and advocating for supply-side solutions to lower costs and improve reliability, referencing a Charles River Associates study.

Nicholas Campanella asked about the tailwinds supporting Exelon's 5%-7% earnings outlook, given the 8% rate base growth and potential financing lag. He also inquired about the regulatory strategy for Pennsylvania and Maryland in 2026, and the company's advocacy efforts regarding supply challenges and the PJM RBA process.

Answer

Jeanne Jones (CFO) explained that the 5%-7% outlook is a continuation of past performance, supported by 8% rate base growth, earned ROEs, manageable equity needs, and AFUDC from transmission capital. Calvin Butler (President and CEO) stated that regulatory strategy in Pennsylvania and Maryland is under consideration, prioritizing affordability and grid reliability, with a Maryland filing expected this year. Colette Honorable (EVP and CLO) detailed Exelon's advocacy for the PJM RBA, extending price caps, and increasing supply, citing a Charles River Associates report on the benefits of utility-generated power.

Nicholas Campanella inquired about the timeline for clarity on repairs and the Corporate Alternative Minimum Tax (CAMT), and its potential impact on Exelon's financing outlook. He also asked for an update on the Atlantic City Electric (ACE) rate case, specifically why settlement remains on the table.

Answer

Jeanne Jones, CFO of Exelon, expressed optimism for CAMT clarity by year-end, stating it would provide incremental balance sheet cushion towards the 14% target and be factored into the Q4 financing update. Calvin Butler, President and CEO of Exelon, explained that the ACE rate case, filed in November 2024, is progressing towards settlement by year-end due to transparent stakeholder discussions and the option for interim rates.

Nicholas Campanella inquired about the timeline for clarity on repairs and the Corporate Alternative Minimum Tax (CAMT), its potential impact on the 2029 financing outlook, and how any resulting financial cushion might be utilized. He also asked for an update on the long-running Atlantic City Electric (ACE) rate case and the continued expectation of a settlement by year-end.

Answer

Jeanne Jones, CFO of Exelon, expressed hope for year-end clarity from the IRS on CAMT guidance, noting it would provide incremental balance sheet cushion and be factored into the Q4 financing plan, aiming for 14% financial flexibility. Calvin Butler, President and CEO of Exelon, credited the ACE team for transparent stakeholder engagement, expressing encouragement for a settlement by year-end due to ongoing discussions and the option of interim rates.

Nicholas Campanella of Wells Fargo Securities inquired about the potential impact of new Maryland legislation, which prohibits reconciliations after January 1, 2025, on the BGE and Pepco reconciliations and whether Exelon's guidance is resilient to adverse outcomes. He also asked about Exelon's willingness to resolve the FERC 206 co-location issue via a settlement.

Answer

Calvin Butler, President and CEO, affirmed that Exelon's financial plan is solid and they are prepared for all alternatives, not expecting the legislation to hinder their objectives. He highlighted positive aspects of the new law, including its recognition of multi-year plans (MYPs), provisions for large load cost allocation, and goals for battery storage. Regarding the FERC 206 proceeding, Butler stated that Exelon is always open to settlement discussions to achieve a quick and equitable resolution for all customers.

Nicholas Campanella from Barclays asked for clarification on the year-over-year growth calculation into 2027 and inquired about legislative priorities in Maryland and Pennsylvania concerning generation solutions and potential rate-basing.

Answer

CFO Jeanne Jones confirmed that the growth outlook is calculated year-over-year from the prior year's guidance midpoint. CEO Calvin Butler, BGE CEO Carim Khouzami, and PECO CEO David Velazquez elaborated on legislative efforts, noting that Maryland is focused on an 'all of the above' approach to incentivize in-state generation, while Pennsylvania is actively exploring alternatives like long-term contracts and utility-build options to ensure resource adequacy, with support from the governor and PUC.

Nicholas Campanella of Barclays asked for confirmation on Exelon's 2024 earnings guidance of 'midpoint or above,' inquired about the company's post-PJM auction strategy for addressing generation needs and rising costs, and questioned the confidence in the rate base growth trajectory.

Answer

CFO Jeanne Jones confirmed the company is aiming for the midpoint or better of its 2024 guidance. CEO Calvin Butler stated that PJM reform is necessary and Exelon is advocating for reliable and affordable energy solutions in partnership with state governors. He affirmed that grid investments are essential for meeting state goals and that the cost of not investing is higher. EVP Colette Honorable added that Exelon's T&D-only focus allows it to partner effectively with policymakers on solutions.

Nicholas Campanella asked about the progress of the GenCo strategic negotiator, what investors should look for regarding further progress, and the company's stance on the supply chain for delivering gas solutions versus renewables and batteries this year. He also inquired about NiSource's Pennsylvania regulatory strategy given no pending rate cases.

Answer

CEO Lloyd Yates explained the unique GenCo solution, excess transmission capacity, and supportive Indiana policy for data center growth, noting a dedicated organization under EVP Michael Luhrs for faster execution. Michael Luhrs, EVP of Strategy and Chief Commercial Officer, confirmed positive negotiations with multiple counterparties and investment in long lead-time equipment for speed to market. Regarding Pennsylvania, Michael Luhrs stated no current rate case is planned, citing a recent December rate case that increased revenue and ROE, and mentioned ongoing work on a regulatory solution to address investment needs without frequent rate cases.

Nicholas Campanella from Barclays asked about the factors that would lead to the high or low end of the $0.25 to $0.45 EPS contribution range and sought confirmation if the 3 gigawatts in strategic negotiations were incremental to this figure.

Answer

Shawn Anderson, EVP and CFO, explained that the $0.25-$0.45 range contemplates multiple customers at the top end, with the full 1-3 gigawatt pipeline potentially outperforming this range. He noted that customer preferences, technology choices, and development timelines influence the specific contribution.

Nicholas Campanella from Barclays asked for clarification on the $0.25 to $0.45 earnings per share (EPS) contribution range, specifically what factors would lead to the high or low end, and whether the 3 GW in strategic negotiations is incremental to this figure. He also questioned NiSource's equity contribution to Genco, given Blackstone's $1.5 billion commitment.

Answer

CFO Shawn Anderson explained that the range contemplates multiple customers at the top end, with the 1-3 GW pipeline potentially outperforming it, depending on technology, timeline, and ramp rate. He clarified that the $300 million-$500 million annual ATM equity covers the full $28 billion capital expenditures, with all financing costs already reflected in the EPS guidance.

Nicholas Campanella asked for clarification on how the Q3 long-term plan refresh aligns with the timing of data center counterparty contracts. He also questioned if the new, narrowed 2025 EPS guidance midpoint of $1.88 should be considered the new base for calculating the 6-8% annual growth target going forward.

Answer

EVP & CFO Shawn Anderson explained that the Q3 plan refresh will update the base capital plan and may incorporate some of the $2.2B in identified upside projects, with data center specifics to be included once they are credibly finalized. He confirmed that the 6-8% annual growth rate would compound off the actual 2025 year-end results, effectively making the updated guidance the new baseline.

Nicholas Campanella of Barclays followed up on the relationship between the upcoming Q3 long-term plan refresh and the separate timeline for data center counterparty contracts. He also sought clarification on whether future EPS growth should be based on the new high-end of the 2025 guidance.

Answer

EVP & CFO Shawn Anderson explained that the Q3 plan refresh will focus on the base regulated utility business and may incorporate some of the $2.2 billion in identified upside projects. He stated that data center-related plans would be integrated once they meet a standard of credibility. Anderson also confirmed that the 6% to 8% annual EPS growth rate should be calculated from the final 2025 actual results.

Nicholas Campanella asked how the upcoming Q3 long-term plan refresh aligns with the separate data center counterparty negotiations and sought confirmation that the narrowed 2025 EPS guidance now serves as the new base for the long-term growth target.

Answer

EVP & CFO Shawn Anderson explained that the Q3 plan refresh will update the base capital plan and may incorporate some of the $2.2 billion in upside projects. He stated that data center specifics would be rolled into the plan once they meet a credibility standard, which could happen at any time. Anderson also confirmed that the 6-8% annual growth rate will compound from the actual 2025 year-end results.

Nicholas Campanella of Barclays asked for an update on the Genco settlement discussion timeline and confirmed that a commercial agreement is not tied to the regulatory proceedings. He also asked if potential coal plant life extensions would impact the long-term resource procurement strategy.

Answer

CEO Lloyd Yates declined to comment on the specific timing of settlement discussions but confirmed that a commercial agreement with a customer is not explicitly tied to the proceeding's timeline. Executive Michael Luhrs added that even with potential plant life extensions, NiSource will still need additional capacity to meet reliability needs under MISO rules.

Nicholas Campanella inquired about the catalysts and timing for incorporating data center opportunities into NiSource's capital plan and whether this would necessitate additional equity financing.

Answer

President and CEO Lloyd Yates positioned data center investments as primarily a '2025 activity,' emphasizing a disciplined approach. EVP and CFO Shawn Anderson confirmed the current $19.3 billion plan is fully financed, while the $1.8 billion upside plan might require modest equity. He clarified that data center investments are incremental to both plans and would require a separate financing evaluation.

Nicholas Campanella asked about the financial impact of recent winter storms and whether these costs are embedded in the 2026 EPS guidance. He also inquired about Duke Energy's strategy for the North Carolina rate case, specifically regarding the potential for settlement versus litigation given affordability concerns and the proposed Carolinas utilities merger.

Answer

President and CEO Harry Sideris stated that storm costs are still being compiled but are not expected to impact 2026 guidance due to recovery mechanisms and strong operational response. Executive Vice President and CFO Brian Savoy confirmed that storm budgets and deferral mechanisms prevent guidance impact. Sideris added that for the North Carolina rate case, Duke Energy is focused on delivering reliable and affordable energy, leveraging tools like tax credits and the merger to mitigate rate increases, and while prepared for litigation, they will seek constructive settlements as in the past.

Nicholas Campanella asked about the costs and impacts from recent winter storms, inquiring if they were already embedded in the 2026 guidance, and also questioned the strategy for the North Carolina rate case regarding affordability and the likelihood of settlement versus litigation.

Answer

President and CEO Harry Sideris confirmed that while storm costs are still being compiled, the company's strong response and existing recovery mechanisms mean no anticipated impact to 2026 guidance. EVP and CFO Brian Savoy added that storm budgets and deferral mechanisms are in place. Regarding the North Carolina rate case, Harry Sideris emphasized the focus on reliable and affordable energy, leveraging tools like tax credits and the one utility merger to mitigate increases, and noted a strong case for investments with a history of constructive settlements.

Nicholas Campanella asked what factors would lead Duke Energy to utilize the lower end of its 30%-50% equity funding range for capital upside and what balance sheet indicators investors should monitor to anticipate less equity issuance.

Answer

Brian Savoy, Executive Vice President and CFO, explained that investments with a higher velocity of recovery would require less equity, thus aligning with the lower end of the funding range. Conversely, investments with slower recovery mechanisms would necessitate more balance sheet support, pushing towards the 50% mark. He noted that the last capital update saw 40% of incremental growth capital funded with common equity or equity support.

Nicholas Campanella asked what factors would lead Duke Energy to utilize the lower end of its 30-50% equity funding range for capital upside.

Answer

Brian Savoy, EVP and CFO, explained that investments with a higher velocity of recovery, such as those with faster recovery mechanisms, would require less equity support, thus leading to the lower end of the 30-50% equity funding range. Conversely, projects with slower recovery would lean towards the higher end.

Nicholas Campanella from Barclays questioned if Duke Energy is considering further asset sales to fund its remaining equity needs and asked for details on the new 15% FFO to debt target, including rating agency feedback and the expected timeline.

Answer

President & CEO Harry Sideris indicated that the company is comfortable with its current equity plan and is not actively pursuing more sales for now. Regarding the credit metric, Sideris noted agencies were already supportive, while EVP & CFO Brian Savoy added that the 15% FFO to debt target will be achieved within the five-year plan, supported by recent legislation and the new transactions.

Nicholas Campanella inquired if using hybrid equity instruments could alter the company's stated equity needs and asked about the potential impact of pending South Carolina legislation on the business plan.

Answer

CFO Brian Savoy noted that while the plan is to use the ATM and DRIP programs, the company will always evaluate cost-effective options like hybrids to meet its modest annual equity needs. President Harry Sideris described the South Carolina legislation as 'tone-setting' and supportive of their strategy but stated it is not expected to cause changes to their existing plans.

Nicholas Campanella from Barclays questioned whether Duke Energy anticipates pulling forward equity to fund higher capital needs and asked for an update on the company's participation in new nuclear development, including SMRs.

Answer

CFO Brian Savoy indicated that while the capital plan will increase, he would not signal any additional equity beyond the existing plan at this time. CEO Lynn Good added that any incremental capital would be financed in a balanced way. President Harry Sideris addressed the nuclear question, stating that while there is promise in SMRs and support from stakeholders, any decision must address first-of-a-kind technology risk, cost overrun protections, and balance sheet strength. He confirmed the recently approved IRPs include early development activities.

Nicholas Campanella inquired about the potential for settling the Very Large Customer (VLC) tariff now that testimonies are out, and whether the General Rate Case (GRC) filing is still on track for mid-year. He also asked about de-risking the financing plan beyond the 2026 ATM program and the capacity for additional hybrid financing.

Answer

CEO Scott Lauber stated that the VLC tariff is expected to go through the full commission decision process to ensure transparency and fair cost allocation for data centers, confirming the GRC filing is on track for April. CFO Xia Liu added that the company has significant capacity for hybrid financing, having issued only $600 million last year, and expects to execute the $900 million to $1.1 billion common equity financing via the ATM program as planned.

Nicholas Campanella from Barclays inquired about the potential for settling the Very Large Customer (VLC) tariff, the timing of the General Rate Case (GRC) filing, and financing plans, specifically regarding de-risking beyond the $1 billion ATM program and hybrid financing capacity.

Answer

Scott Lauber, CEO of WEC Energy Group, stated that the VLC tariff process is expected to go the full period to ensure transparency and fair share payment from data centers, with the GRC filing on track for April. Xia Liu, CFO, confirmed significant hybrid financing capacity and the expectation to execute $900 million-$1.1 billion in common equity via the ATM program throughout the year.

Nicholas Campanella inquired about WEC Energy Group's strategy for meeting the 3.5-gigawatt demand from the new Vantage data center, the potential impact of increased capital spending on the company's long-term growth rate, and the timeline for a decision on the proposed large load tariff.

Answer

President and CEO Scott Lauber explained that WEC is actively working with Vantage on a phased approach, with an initial target of 1.3 gigawatts by 2027, and will provide a more detailed capital plan update on the Q3 call. He noted the system is tight, reinforcing the need for new generation. Lauber also stated that the large load tariff is in a review process with the commission, having already secured agreement from the large customers involved.

Nicholas Campanella asked for the specific rate base growth outlook for Wisconsin, given that it is the primary driver of the company's overall asset growth.

Answer

Executive Scott Lauber estimated that rate base growth in Wisconsin will be significant, in the 14% to 15% range. He and CFO Liu Xia emphasized that this growth is substantially driven by economic development, with about 40% of the total capital plan classified as 'growth capital' supported by new customer demand, which helps mitigate the rate impact on existing customers.

Nicholas Campanella raised concerns about the significantly low 8% ROE proposed in the ALJ Proposal for Decision (PFD) for the electric rate case, asking about stakeholder feedback, the decision timeline, and CMS Energy's confidence in a constructive outcome. He also inquired about the impact of 1-2 GW of data center load on future capacity needs, the outlook for capacity to the early 2030s, and whether this load would be incremental to the existing 10.5 GW rate base growth.

Answer

Garrick Rochow (CEO, CMS Energy) dismissed concerns about the ALJ PFD, reiterating confidence in achieving a 9.9% ROE or better, citing the MPSC staff's constructive position and the commission's support for attracting capital. He clarified that data center growth is not included in the current $24 billion investment plan and would represent incremental CapEx. Mr. Rochow outlined capacity needs driven by the clean energy law, existing load growth (3% next year, 2-3% over five years), and upcoming retirements (Karn 3 and 4 in 2031). Rejji Hayes (CFO and Executive Vice President, CMS Energy) added that each gigawatt of additional load requires $2.5 billion to $5+ billion in CapEx for distribution and supply, which would be incremental to the current rate base growth.

Nicholas Campanella raised concerns about the Administrative Law Judge's (ALJ) Proposal for Decision (PFD) suggesting an 8% Return on Equity (ROE), asking about stakeholder feedback, the decision tree into March, and CMS Energy's confidence in achieving a constructive outcome, specifically an ROE of 9.9% or better. He also questioned how the potential 1-2 GW data center load impacts capacity needs out to the early 2030s and if it would be incremental to the current 10.5 GW outlined, given the Large Load Tariff.

Answer

Garrick Rochow, President and CEO, stated he was not concerned about the ALJ PFD, reiterating his expectation for an ROE of 9.9% or better, calling the 8.2% an outlier. He emphasized the constructive position of the MPSC staff ($317 million revenue deficiency vs. $423 million ask) and the commission's public comments supporting grid improvements and constructive ROEs. He clarified that data center investments are not included in the current $24 billion 5-year plan and would be incremental. Mr. Rochow detailed the Integrated Resource Plan (IRP) would address capacity gaps from clean energy, existing load growth (3% next year, 2-3% over five years), and retirements (Kern 3 & 4, ~1 GW by 2031). Rejji Hayes, CFO and Executive Vice President, added that every gigawatt of additional load requires $2.5 billion to $5+ billion in CapEx for distribution and supply, which would increase rate base growth.

Nicholas Campanella asked for clarification on how the new 1-gigawatt data center load impacts the previously disclosed $5 billion CapEx opportunity. He also questioned the likelihood of a settlement in the pending gas rate case and inquired about 2026 financing plans, including any potential to pre-fund equity needs.

Answer

President & CEO Garrick Rochow clarified that the $5 billion CapEx opportunity is tied to the existing 2-3% sales growth forecast, and the new 1-gigawatt load is incremental, suggesting the CapEx figure will be adjusted upward. Regarding the gas case, he expressed comfort in going to a fully adjudicated order given the constructive staff recommendation but remains open to settlement. EVP & CFO Rejji Hayes added that the company is evaluating pulling forward 2026 financing needs into late 2025 if efficient opportunities arise.

Nicholas Campanella sought clarification on the company's opportunistic financing strategy, asking if it could include pulling forward the planned 2025 equity issuance.

Answer

CFO Rejji Hayes specified that the company would not be issuing equity in 2024. The opportunistic approach applies to parent company debt financing, such as senior notes or hybrids, to address 2025 needs if market conditions are favorable. The plan for up to $350 million in equity starting in 2025 remains unchanged, with no intention to pull it forward.

Nicholas Campanella sought clarification on whether the 6 GW data center capacity now puts upward pressure on the 5% long-term load growth factor. He also asked about the significantly under-authorized earned returns for 2025, particularly in Colorado and SPS, and the expected ROE trending post-rate cases. Finally, he inquired about the low end of the $10 billion+ incremental capital bucket and if a higher bookend figure could be provided for the next full-year update.

Answer

Brian Van Abel, EVP and CFO, confirmed that the 6 GW data center capacity does provide sales growth opportunity, primarily in the 2029-2030 timeline and extending beyond, deepening and prolonging investment opportunities. Bob Frenzel, Chairman, President, and CEO, addressed the under-earnings, noting that SPS's performance was affected by challenging Q4 weather and other unique items, with recovery expected. For Colorado, he attributed under-earnings to the Marshall wildfire trial and expressed confidence in significant ROE improvement in 2027 following rate case decisions expected in late Q3 2026. Regarding the $10 billion+ capital bucket, Bob Frenzel highlighted several outstanding RFPs (Colorado, SPS, Minnesota) and the recent 765 kV transmission line award in SPP ($1.5 billion) as key drivers, emphasizing the 'plus' next to the $10 billion signifies substantial upside and pipeline extension beyond 2030.

Nicholas Campanella sought clarification on whether the 6 GW data center capacity implies higher pressure on the 5% long-term load growth factor. He also asked about the significantly under-authorized earned returns in 2025 for Colorado and SPS, and what's embedded in the low end of the $10 billion+ incremental capital bucket.

Answer

Roopesh Aggarwal, Vice President, Investor Relations, confirmed that the 6 GW data center target provides sales growth opportunity, primarily in the 2029-2030 timeline and extending into the 2030s. He explained that SPS's under-earnings in 2025 were due to challenging weather and unique items, with recovery expected. For Colorado, significant under-earnings were noted, but with the Marshall wildfire settlement nearly complete, rate cases filed late last year are expected to drive significant ROE improvement in 2027. He outlined key markers for the $10 billion+ incremental bucket, including various RFPs and a new $1.5 billion transmission line, emphasizing the pipeline's deepening and extension beyond 2030.

Nicholas Campanella from Barclays asked about the potential impact of recent federal legislation (OBBB) and upcoming Treasury guidance on the company's renewable build-out, particularly regarding safe harbor provisions. He also inquired how the significant CapEx upside would translate to EPS growth and affect equity issuance needs, and asked for an update on the possibility of a settlement in the Marshall Fire case.

Answer

EVP & CFO Brian Van Abel stated that the company feels well-positioned for its renewable projects, having already commenced physical construction on many, and will manage through any new Treasury guidance. He confirmed the incremental CapEx would be funded with a balanced mix of debt and equity, potentially pushing EPS growth to the high end of the 6-8% range at times. Chairman, President, & CEO Robert Frenzel clarified that while court-ordered mediation for the Marshall Fire has ended, settlement discussions can still occur, but the company is prepared for trial, maintaining its equipment did not cause the second ignition.

Nicholas Campanella from Barclays asked about the potential impact of sunsetting tax credit transferability on Xcel's cash flow and 5-year plan, and how the tariff outlook is affecting economic development and C&I sales in their service territory.

Answer

CEO Robert Frenzel expressed confidence that transferability is linked to the credit programs and will likely continue. CFO Brian Van Abel detailed mitigation strategies, including the long-term nature of safe-harbored projects and an alternative 30-year flowback mechanism for PTCs, which would significantly reduce equity needs. Frenzel noted a change in sentiment but not yet in actual activity due to tariffs, while Van Abel added that oil and gas customer expectations remain unchanged and sales in that sector are strong.

Nicholas Campanella inquired about the impact of new administration policies on renewable project permitting, the value of tax credit transferability in the forecast, and the timeline for securing new data center customers.

Answer

CEO Robert Frenzel stated that while they support permitting reform, their projects have light federal permitting needs and they expect to work through any challenges. CFO Brian Van Abel confirmed the plan includes approximately $700 million annually in PTC transferability and that they expect to sign contracts fulfilling their base plan for data centers by the fall.

Nicholas Campanella inquired about a recent large customer land acquisition in Minnesota, asking for details on its location, its inclusion in the long-term load growth forecast, and the associated rate design. He also asked about the company's 2024 equity financing plans.

Answer

EVP and CFO Brian Van Abel confirmed the land acquisition was in Minnesota by an undisclosed customer and is included in the company's high-probability load forecast. He noted constructive ongoing discussions with the Minnesota Commission to support data center growth. Chairman, President and CEO Robert Frenzel added this project is part of the 25% of the 9,000 MW pipeline included in the 5-year plan. Regarding financing, Brian Van Abel stated that the recent $1.1 billion ATM issuance fulfills their equity needs for the year, though they remain open to opportunistic actions.

Nick Campanella asked for clarification on annualizing the $0.16 Texas benefit from House Bill 4384 against the original $0.40 guide, and also sought to quantify the margin benefit from Waha spreads during the quarter.

Answer

Chris Forsythe (CFO) reiterated that it is difficult to simply annualize the $0.16 benefit due to the timing of deferrals and operational activities, especially with recent winter operations impacting capital, and stated updates would be provided quarter by quarter. He attributed approximately $7 million in operating income increase quarter-over-quarter to the Waha spread activities.

Nicholas Campanella (via Fei) asked for a deeper understanding of the EPS rebase, specifically inquiring about the incremental regulatory improvements from the Refresh plan, and whether these were primarily driven by Texas House Bill 4384 or other assumptions. He also sought clarification on the 2026 O&M budget, asking why it was a lower assumption and how the 4% annual increase would evolve long-term.

Answer

President and CEO Kevin Akers and Senior Vice President and CFO Chris Forsythe clarified that the incremental regulatory improvement is entirely due to Texas House Bill 4384, which now includes APT's investment. Chris Forsythe added that the five-year plan assumes no new regulatory features beyond existing annual filing mechanisms. Regarding O&M, Chris Forsythe stated the 2026 guidance midpoint is consistent with the prior year, reflecting a reset based on compliance, system monitoring, and damage prevention activities, with continued evaluation for further safety-related spending.

Nicholas Campanella asked for clarification on the EPS rebase, specifically how much incremental regulatory improvement in the Refresh plan stems from Texas House Bill 4384 versus other assumptions, given the accelerated CapEx recovery. He also inquired about the lower O&M budgeting for fiscal 2026 and the evolution of the 4% annual increase long-term.

Answer

Kevin Akers, President and CEO, confirmed that the incremental regulatory improvement is entirely due to Texas House Bill 4384, which now includes APT's investment. Chris Forsythe, Senior Vice President and Chief Financial Officer, added that the five-year plan assumes no new regulatory features beyond existing annual filing mechanisms. Regarding O&M, Mr. Forsythe stated the 2026 guidance is consistent with the 2025 midpoint, reflecting a reset based on compliance, system monitoring, and damage prevention activities after additional spending opportunities in fiscal 2025.

Nicholas Campanella from Barclays asked for clarification on annualizing the $0.10 EPS benefit from the Texas legislation within the long-term 6-8% CAGR. He also questioned how stronger operating cash flow might impact future financing strategies and the potential to moderate external equity needs.

Answer

SVP & CFO Christopher Forsythe advised against simply annualizing the $0.10 benefit, as the deferral is contingent on the timing of when specific assets are placed into service, noting a full update will be provided in November. Regarding financing, Forsythe explained that the increased operating cash flow was anticipated in the current five-year plan and the company will maintain its balanced financing approach using a mix of equity and long-term debt.

Nicholas Campanella sought clarification on annualizing the $0.10 EPS benefit from the Texas legislation and its integration into the long-term 6-8% CAGR, and also asked how stronger cash flow might affect future financing needs.

Answer

SVP & CFO Christopher Forsythe advised against a simple annualization of the $0.10 benefit, as deferrals depend on the timing of assets being placed in service, with a full update planned for November. He also noted that the increased operating cash flow was anticipated in the five-year plan and that the company will maintain a balanced financing approach using both equity and debt.

An associate for Nick Campanella of Barclays inquired about Atmos Energy's equity financing plans for the remainder of the fiscal year and its strategy for managing interest costs. The analyst also asked for details on the project pipeline supporting the significant commercial and industrial customer growth in Texas.

Answer

CFO Christopher Forsythe affirmed the company's balanced financing strategy, utilizing the ATM program for equity needs through fiscal 2026 and a planned fall debt issuance with existing swaps. CEO John Akers highlighted key growth projects, including the WA Loop and Bethel to Groesbeck pipelines, and noted that 85% of capital investment is dedicated to safety and reliability.

Nicholas Campanella sought clarification on the gating items for FPL's large load customer agreements, asking what customers are waiting for (e.g., water, land permitting, zoning) before moving forward. He also requested an update on the gas turbine supply chain, specifically when NextEra Energy plans to secure the additional 4 GW beyond the already secured 4 GW, and current pricing and availability through 2032.

Answer

CEO of Florida Power & Light Armando Pimentel explained that customers are seeking long-term comfort, awaiting clarity on current legislation in Tallahassee regarding water usage and state/local municipality support for hyperscalers. He expressed confidence in a constructive legislative outcome and anticipated large load announcements in FPL's service territory in 2026. Chairman, President, and CEO John Ketchum stated that the additional 4 GW of gas turbine supply would be secured as data center hub discussions advance, emphasizing that gas turbine availability and economic pricing, given their partnership with GE Vernova, are not major concerns. He noted pricing remains consistent with December's guidance.

Nicholas Campanella asked about the gating items on the customer side for FPL's large load agreements, including factors like water, land permitting, and zoning, and what needs to materialize for 2026 announcements. He also requested an update on the gas supply chain, specifically when NextEra would secure the additional 4 GW beyond the existing 4 GW, and current pricing and availability through 2032.

Answer

Chief Executive Officer of Florida Power & Light Company Armando Pimentel explained that customers are awaiting clarity on ongoing legislative discussions in Tallahassee regarding water usage and municipal support for data centers, but he expects a constructive outcome and announcements in 2026. Chairman, President, and Chief Executive Officer of NextEra Energy John Ketchum stated that securing additional gas turbine supply would align with advancing data center hub discussions, emphasizing prudent supply chain management. He expressed confidence in gas turbine availability and economic pricing through their partnership with GE Vernova, consistent with prior guidance.

Nicholas Campanella asked about NextEra Energy's strategy for new nuclear development, specifically the appetite for AP1000 reactors versus small modular reactors (SMRs) or existing plant restarts, and the company's long-term growth philosophy compared to peers.

Answer

John Ketchum, Chairman, President and CEO of NextEra Energy, emphasized optimizing existing nuclear assets like Duane Arnold, Point Beach, and Seabrook, and exploring SMR potential with disciplined capital allocation. He highlighted NextEra's unique position to serve hyperscalers with diverse generation types and a strong balance sheet. Mr. Ketchum deferred discussion on the long-term growth philosophy to the upcoming December 8th investor conference.

Nicholas Campanella inquired about NextEra Energy's strategy for new nuclear development, specifically asking if the company has an appetite for AP1000 projects or if the focus remains solely on SMRs and restarts of existing large-scale plants. He also asked about the company's philosophy on long-term growth targets, considering its consistent outperformance.

Answer

John Ketchum, Chairman, President, and CEO of NextEra Energy Inc., stated that the current focus is on Duane Arnold, Point Beach, and Seabrook, with potential for 6 GW of SMR capacity across these sites. He also mentioned exploring greenfield sites for advanced nuclear and emphasized a disciplined capital allocation strategy for SMRs to limit financial exposure. Mr. Ketchum highlighted NextEra Energy's unique position to serve hyperscalers with a strong balance sheet, diverse generation capabilities (renewables, storage, gas, nuclear), and transmission solutions. He deferred discussion on long-term growth targets to the upcoming investor conference.

Nicholas Campanella of Barclays requested an update on the FPL rate case, asking if a settlement was still possible, and inquired about the expected financing mix for projects through 2029 given the safe harbor visibility.

Answer

Armando Pimentel, President & CEO of Florida Power & Light, stated that while FPL is preparing for hearings, a settlement remains a possibility if it is beneficial for customers. Michael Dunne, EVP & CFO, addressed financing, confirming they will continue to use tax equity and project finance. He highlighted that NextEra has increased its tax equity providers by 50% in the last two years and continues to see strong interest from financing partners.

Nicholas Campanella asked how NextEra's contractual tariff protections might impact project returns and its competitive position, and requested an update on the contracting progress for the Duane Arnold nuclear facility.

Answer

John Ketchum, Chairman, President and CEO, responded that the company's strong position on tariffs presents a significant competitive opportunity. He anticipates that smaller developers without similar buying power or contractual leverage may struggle, potentially driving more demand toward NextEra. On the Duane Arnold project, Ketchum stated that progress is going 'great,' with no showstoppers identified and continued strong demand for generation from the facility.

Asked about FPL's surplus reserve mechanism and expected 2025 ROE in light of the upcoming rate case, and sought confirmation on the accounting treatment and stability of the income stream from its affiliate, XPLR.

Answer

FPL's reserve mechanism remains important for managing risks like inflation and interest rates, and there could be slight upside to the 11.4% ROE in 2025. The accounting for XPLR in their outlook is unchanged, with further details on XPLR to be provided in a separate call.

Nicholas Campanella from Barclays commented on the positive 2% customer bill impact in the upcoming FPL rate case and asked for updates on the surplus reserve mechanism and expectations for FPL's earned ROE in 2025. He also sought to confirm the continued inclusion of XPLR's earnings in NextEra's outlook.

Answer

An executive noted that FPL's capital investment for 2026-2029 is expected to exceed the $36 billion from the current plan due to strong growth. The reserve surplus, now at about $800 million, remains necessary to buffer against inflation and interest rate risks. They anticipate a potential for slight upside to the 11.4% ROE in 2025. CFO Brian Bolster confirmed that the accounting for XPLR remains unchanged in NextEra's outlook.

Nick Campanella inquired about Ameren's view on its 6%-8% earnings growth range, specifically if the lower end could be reconsidered, and also asked about balance sheet capacity, the impact of increased sales on cash flow, and potential for lower equity needs.

Answer

Chairman, President, and CEO Marty Lyons and Senior EVP and CFO Michael Moehn affirmed confidence in delivering near the upper end of the 6%-8% growth range, noting potential for greater investment. Michael Moehn highlighted Ameren's strong balance sheet, FFO levels above peers, and disciplined equity management.

Nick Campanella inquired about Ameren's 6-8% EPS growth range, specifically the lower end, and the potential for upward revision, as well as balance sheet capacity, FFO levels, and the impact of increased sales forecasts on cash flow and equity needs.

Answer

Marty Lyons, Chairman, President, and CEO, and Michael Moehn, Senior Executive Vice President and Chief Financial Officer, expressed confidence in delivering near the upper end of the growth range, pending tariff approval and energy service agreement signings. Michael Moehn highlighted that sales growth is accretive, discussed tax credits, strong credit ratings (Baa1, BBB+), operating above the 17% downgrade threshold, and disciplined equity management, having covered 2025 and 2026 equity needs.

Nicholas Campanella asked if Ameren would reevaluate its 6-8% EPS growth rate if it achieves further success with data center load growth, and sought clarification on whether the plan for 2 gigawatts of demand capacity is incremental to current agreements.

Answer

CEO Martin Lyons responded that while the 6-8% guidance is appropriate for the next five years, the company would reevaluate the range if growth accelerates further, as they do not want to constrain it. He clarified that the resource plan is designed to serve a full 2 gigawatts of demand by 2032, which ramps up over time and accommodates the nearly 1.8 gigawatts of existing construction agreements, with capacity for more thereafter.

Nicholas Campanella from Barclays inquired about the timing of capital plan increases, the associated impact on equity financing needs, and the potential effects of the recent election on EPA-driven investments and IRA tax credit policies.

Answer

Michael Moehn, Senior Executive VP and CFO, stated the current financing plan is unchanged, with the ATM program being the primary vehicle to meet equity needs while maintaining a strong balance sheet and credit ratings. Martin Lyons, Chairman, President and CEO, addressed the election, stating that Ameren's strategy is unchanged. He sees a lower risk of corporate tax hikes and expects a 'surgical' approach to any IRA adjustments, given the significant customer benefits. He confirmed the importance of tax credit transferability and believes existing EPA-related capex is secure.

Nicholas Campanella asked how the potential pre-approval generation and a possible data center deal would impact OGE Energy's long-term EPS CAGR, or if these developments primarily reinforce confidence in the existing 5%-7% range.

Answer

Charles Walworth, CFO, affirmed that the 5%-7% EPS CAGR was already considered solid, irrespective of new deals. He explained that OGE Energy's philosophy involves an annual reassessment of guidance, potentially adjusting the trend line from the previous year, which is more indicative of their approach to incorporating new opportunities.

Nicholas Campanella asked how the pre-approval generation and a potential data center deal would impact OGE Energy's long-term EPS CAGR, or if these developments primarily reinforce confidence in the existing 5%-7% range.

Answer

Chuck Walworth, CFO, reiterated that the 5%-7% EPS CAGR remains in solid shape regardless of specific deals. He explained that OGE Energy's philosophy involves an annual review of guidance, with the potential to adjust the trend line as needed, rather than immediately altering the long-term range based on individual projects.

Nicholas Campanella of Barclays inquired about the financial impact of potential CWIP recovery legislation (SB 998), the timeline for filings related to data center projects, and whether a recent Oklahoma Supreme Court decision affects serving large load customers.

Answer

CFO and Treasurer Charles Walworth explained that CWIP recovery would be credit accretive by providing cash flow during construction, helping to facilitate project financing. Chairman, President and CEO R. Trauschke clarified that the main generation RFP filing is expected in a few weeks, with data center needs to be included then or filed separately later. He also confirmed the Supreme Court ruling does not impact their ability to serve data centers like the one in Stillwater.

Nicholas Campanella of Barclays inquired about OGE's position within the supply chain for new generation equipment, like turbines, to serve potential data center customers. He also asked for a timeline on when to expect updates on new data center contracts.

Answer

Chairman, President and CEO R. Trauschke expressed confidence in the company's ability to source equipment based on visibility from the current RFP process. He clarified there is no set timeline for data center announcements, as they may come from the customers themselves, and OGE would then make the necessary regulatory filings for new capacity, potentially separate from the midyear RFP results filing if timing doesn't align.

Nicholas Campanella sought further clarification on the 7-9% growth rate, asking if the 9% plus for 2028-2030 should be considered year-over-year growth off 2027 or a CAGR from 2026.

Answer

Trevor Mihalik, EVP and CFO, clarified that the first two years of the plan will see growth below the midpoint of the 7-9% range, while the back three years (2028-2030) will experience year-over-year growth at or above 9%, resulting in an overall 9% CAGR from the 2025 midpoint.

Nick Campanella asked about the expected cadence of earned ROE improvement between 2026 and 2030, specifically if it's projected to happen linearly year-by-year, given upcoming rate cases like Ohio. He also sought further clarification on the 7-9% growth rate, asking if the 9% plus for 2028 is a year-over-year growth off 2027 or a CAGR from 2026.

Answer

Bill Fehrman, Chair, President and CEO, emphasized that ROE improvement is a top priority, noting steady progress over the past year due to constructive regulatory and legislative developments. He highlighted that AEP Transmission, AEP Ohio, and INM have posted ROEs near or above authorized levels, and AEP Texas is improving due to HB 5247. While PSO, SWEPCO, and Kentucky Power are impacted by regulatory lag, improvements are expected from new base cases and generation filings. Fehrman acknowledged the West Virginia ROE was affected by a recent order but confirmed a reconsideration filing and ongoing engagement. Trevor Mihalik, EVP and CFO, clarified that the 7-9% growth rate is bifurcated: the first two years will be below the midpoint, and the back three years (2028, 2029, 2030) will be at or above 9% year-over-year, resulting in an overall 9% CAGR from the 2025 midpoint.

Nicholas Campanella of Barclays inquired about the expected equity percentage required to fund the incremental $16 billion in capital and sought clarification on the rationale for combining C&I load reporting and the outlook for 2025 load growth.

Answer

EVP & CFO Trevor Mihalik indicated an equity ratio in the 30-40% range is a reasonable contemplation for the new capital, but the final plan will be refined using tools like hybrids and improved cash flow. He explained that combining C&I load reporting aligns with industry practice and better reflects the business, adding that revenue is protected by demand minimums in contracts despite any short-term load volatility.

Nicholas Campanella inquired about the financing strategy for the potential $10 billion in CapEx upside, asking about levers like asset sales or securitization to mitigate equity needs. He also sought clarification on any quantifiable exposure if IRA tax credit transferability were repealed.

Answer

Trevor Mihalik, EVP and CFO, explained that the company has completed its anticipated equity needs through 2029 for the base $54 billion plan via the transco minority sale and a $2.3 billion forward equity offering. Any equity for the incremental $10 billion would be on the back end of the plan. He highlighted levers like the West Virginia securitization and hybrid debt to finance growth in a shareholder-friendly way, ruling out further transmission sales. On the IRA, he stated a retroactive repeal is unlikely and that all of AEP's anticipated tax credits through 2027 are safe-harbored, with manageable exposure.

Nicholas Campanella from Barclays inquired about the flexibility provided by the accretive transmission sale and whether it would lengthen the 6-8% long-term growth rate. He also asked about the company's strategy regarding further portfolio management.

Answer

EVP and CFO Trevor Mihalik explained the transmission sale is accretive by roughly $0.11-$0.12 per share annually, which supports the 2025 guidance and strengthens credit metrics. He and President and CEO William Fehrman emphasized that the company's primary focus is on executing its massive $54 billion capital plan, suggesting a focus on growth over further pruning.

Nicholas Campanella asked for management's view on how nuclear power fits into AEP's long-term strategy and sought clarity on whether the new 6% to 8% long-term growth rate would be linear or variable year-to-year.

Answer

President and CEO William Fehrman stated that AEP will support customer and state interest in nuclear power but emphasized the necessity of a broad risk-mitigation framework. EVP and CFO Chuck Zebula explained that the 6% to 8% growth is not expected to be linear, which is why a range was provided, but all years should fall within it.

Nicholas Campanella inquired about the potential role of nuclear power in AEP's long-term strategy and asked if the new 6-8% EPS growth rate would be linear over the forecast period.

Answer

CEO William Fehrman expressed openness to nuclear power if desired by customers and states, but stressed the need for broad risk mitigation. CFO Charles Zebula clarified that the 6-8% growth is not expected to be linear, which is why a range was provided, though all years should fall within it.

Nicholas Campanella inquired about the $0.10 charge for preferred equity refinancing in the 2025 guidance, seeking clarification on whether it covers both 2026 and 2027 maturities and the company's options for addressing this without new equity. He also asked about the participation level and claims estimation timeline for the Eaton Fire Wildfire Recovery Compensation Program, and the impact of SB 254 protections.

Answer

EVP and CFO Maria Rigatti confirmed the $0.10 charge relates to deferred transaction costs for two preferred equity series with 2026 and 2027 rate resets, noting that recent TKM and pending Woolsey settlements provide more refinancing options, potentially leading to earlier action. President and CEO Pedro Pizarro clarified the Eaton Fire program is not yet launched, and while a single subrogation settlement occurred, it's too early to estimate total losses. Maria Rigatti added that SB 254 sets the Eaton liability cap at approximately $4 billion and allows securitization of claims for certain fires before reasonableness review, minimizing costs and avoiding new debt or equity.

Nicholas Campanella inquired about the $0.10 charge for preferred equity refinancing included in the 2025 guidance, seeking confirmation on whether it covers both 2026 and 2027 maturities and details on refinancing options without common equity. He also asked about the participation level and claims visibility for the Wildfire Recovery Compensation Program, and when a liability estimate for the Eaton Fire might be available.

Answer

Maria Rigatti (EVP and CFO, Edison International) confirmed the $0.10 charge represents a write-off of deferred transaction costs for early refinancing of two preferred equity series, leveraging increased flexibility from TKM and Woolsey settlements. Pedro Pizarro (President and CEO, Edison International) clarified the Wildfire Recovery Compensation Program is not yet launched but expected shortly, and tempered expectations for an immediate Eaton Fire loss estimate due to the complexity and ongoing process. Maria Rigatti added that SB 254 provides a clear liability cap of approximately $4 billion for Eaton and allows securitization of claims before reasonableness review, minimizing costs and avoiding new debt/equity issuance.

Nicholas Campanella inquired about the proposed legislative fix for AB 1054, specifically the structure of utility contributions, and the expected timing for disclosing liability estimates for the Eaton fire.

Answer

President and CEO Pedro Pizarro explained that Edison International will evaluate the total legislative package before commenting on specific elements like shareholder contributions. He noted that the wildfire fund's current cash position may negate the need for upfront payments. Regarding the Eaton fire, he stated that while disclosures typically occur during quarterly earnings, a material development could warrant an off-cycle announcement.

Nicholas Campanella inquired about the proposed legislative fix for AB 1054, asking what would constitute an acceptable structure for utility contributions and if Edison International is open to shareholder equity contributions. He also asked about the disclosure timeline for the Eaton fire's cause and potential liabilities.

Answer

President and CEO Pedro Pizarro stated that the company must evaluate the entire legislative package before judging any single component, emphasizing the principle of recovering prudently incurred costs. He noted that the wildfire fund's current cash position suggests upfront shareholder contributions are not immediately necessary. Regarding the Eaton fire, Mr. Pizarro explained that disclosures would follow the standard quarterly reporting cycle unless a material development warranted an off-cycle announcement.

Nicholas Campanella of Morgan Stanley asked about the timing of the material loss disclosure for the Eaton Fire and how potential liabilities might affect the company's upcoming financing plan refresh.

Answer

President and CEO Pedro Pizarro explained the disclosure was made because while Edison's equipment involvement isn't confirmed, no other likely cause has emerged. He noted liability is not yet estimable. CFO Maria Rigatti added that the financing plan will not be impacted by potential claims, as they would be paid via the state's wildfire fund after a $1 billion self-insurance layer, not through new debt issuance, which is a key difference from past incidents.

Nicholas Campanella inquired about the potential financial damages from the Eaton fire and the timeline for determining liability, as well as the current policy environment for legislative solutions to strengthen the AB 1054 framework.

Answer

CEO Pedro Pizarro stated it is "way too early" to estimate potential liabilities, noting that investigations and legal actions could take a significant amount of time. Regarding legislative solutions, Pizarro explained that while it's early, conversations with policymakers are constructive. He highlighted that the state has a better understanding of the need for financially healthy utilities now than in 2018 and has engaged financial advisors, indicating a serious approach to reinforcing the AB 1054 framework.

Nicholas Campanella asked to confirm the calculation for 2026 earnings power by adding the TKM run-rate benefit to the 2025 midpoint and growing from there. He also inquired about what factors could make the Woolsey cost recovery outcome different from the TKM settlement.

Answer

EVP and CFO Maria Rigatti confirmed the $0.14 TKM benefit is an ongoing run rate additive to future earnings. President and CEO Pedro Pizarro explained that the Woolsey and TKM cases are very different and case-specific, noting TKM involved two merged fires with complex ignition sources, whereas Woolsey had a single ignition point, making a direct comparison of outcomes inappropriate.

Nick Campanella inquired about FirstEnergy's strategy for West Virginia generation, specifically comparing build-own-transfer versus self-build options, the expected capital recovery mechanisms, and the potential earnings impact between 2028 and 2031. He also asked about the company's rate case strategy for 2026, focusing on states like Maryland, West Virginia, and New Jersey where ROEs are trending lower than authorized.

Answer

Brian Tierney, Chair, President, and CEO, explained that for self-build projects, FirstEnergy would file for Construction Work in Progress (CWIP) recovery during construction, with significant earnings attribution occurring after the asset is online. Jon Taylor, Senior Vice President and Chief Financial Officer, indicated that the company would follow a similar rate case cadence as in previous years for Maryland, New Jersey, and West Virginia, emphasizing the importance of timely recovery through base rate increases to earn close to allowed returns as capital is deployed.

Nick Campanella inquired about FirstEnergy's strategy for West Virginia generation, specifically comparing build-own-transfer versus self-build options, capital recovery methods, and the expected earnings impact between 2028 and 2031. He also asked about the company's rate case strategy for 2026, focusing on Maryland, West Virginia, and New Jersey where ROEs are trending lower than authorized.

Answer

Brian Tierney, Chair, President, and CEO, explained that for self-build, FirstEnergy would file for Construction Work in Progress (CWIP) during construction, expecting recovery and potentially earnings components, with significant earnings after the asset is online. Jon Taylor, Senior Vice President and Chief Financial Officer, stated that the 2026 rate case cadence would likely follow previous patterns, emphasizing the importance of utilities earning close to their allowed returns and timely capital recovery through base rate increases.

Nicholas Campanella asked for clarification on the potential 20% transmission CapEx increase, its total dollar value, the company's balance sheet capacity, and its stance on pursuing a generation company (genco) in Pennsylvania following recent PJM auction results.

Answer

SVP & CFO K. Jon Taylor confirmed that CapEx is reported on a gross basis. President, CEO & Chairman Brian Tierney estimated the incremental upside at $2.3 billion to nearly $4 billion, stating the company is comfortable with its financing options. Tierney also noted FirstEnergy would build regulated or fully contracted generation but is currently focused on its integrated operations in West Virginia, while praising Pennsylvania's leadership on energy policy.

Nicholas Campanella followed up on the Ohio situation, asking if the Electric Security Plan (ESP) could be addressed in the settlement talks and whether the company can maintain its growth trajectory despite the uncertainty.

Answer

Brian Tierney, Chair, President and CEO, clarified that the ESP would not be part of the base rate case settlement. He expressed confidence in the company's ability to manage the transition through legislative means, commission action, or by shifting CapEx. He reaffirmed the 6% to 8% compound annual growth rate target, noting it is not strictly linear year-to-year but achievable over the investment horizon.

Nicholas Campanella followed up on the Ohio rate case, asking about the likelihood of a settlement versus a fully litigated process. He also questioned why the long-term growth target is 6-8% rather than a higher 7-8%, given management's confidence.

Answer

Executive Brian Tierney responded that while FirstEnergy is open to settlements, he anticipates the complex Ohio rate case will be fully adjudicated, but he does not see any regulatory overhang. He explained the 6-8% growth range accounts for traditional utility risks, but noted that potential tailwinds from competitive transmission awards and new data centers could push results to the higher end of that range once they are secured.

Nicholas Campanella asked about the amount of available transmission capacity for new loads, the impact of rising PJM capacity prices on the company's investment plans, and whether the Pennsylvania earned ROE would normalize in 2025 following the recent settlement.

Answer

Executive Brian Tierney stated the company has several thousand megawatts of available transmission capacity. He acknowledged rising PJM costs are a concern but do not currently impede their investment recovery plans. Executive Jon Taylor clarified that the low reported Pennsylvania ROE was based on the original rate filing and is expected to normalize with the approved settlement.

Nicholas Campanella asked about the UK RWA deployment, noting a Q3 deployment of circa GBP 1 billion against a perceived run rate closer to GBP 2 billion per quarter, and whether a catch-up is expected. He also sought details on the anticipated headwinds from the maturity of mortgages underwritten during the COVID-19 period, including their expected duration and impact.

Answer

Anna Cross, Group Finance Director, Barclays, clarified that the GBP 30 billion RWA target includes GBP 18 billion deployed so far, with GBP 11 billion being organic. She explained that RWA growth is a shorthand for lending desire, and while RWAs can fluctuate, the focus is on lending, which generates income. She expressed satisfaction with the progress, citing strong mortgage and corporate lending. Regarding mortgage headwinds, Ms. Cross stated that churn effects have been stable, but a period of pressure is expected from maturing 5-year fixed-rate mortgages from the stamp duty holiday period (late 2020/early 2021), which will compress margins slightly but is already accounted for in BUK's NII guidance.

Nicholas Campanella from Keefe, Bruyette & Woods questioned the UK RWA deployment, noting a Q3 run rate closer to £1 billion compared to a typical £2 billion per quarter, and asked if a catch-up is expected. He also inquired about the specific headwinds anticipated from the maturity of mortgages underwritten during the COVID-19 period and their expected duration.

Answer

Anna Cross, Group Finance Director, Barclays, clarified that the £30 billion RWA target is a shorthand for lending desire, and while RWAs can fluctuate, the focus is on lending, which has been strong. She stated that the timing differences between RWAs and loans are normal and no specific catch-up is needed. Regarding mortgage headwinds, Ms. Cross explained that the maturity of five-year fixed-rate mortgages from the 2020-2021 stamp duty holiday period will lead to some churn compression and margin pressure, particularly towards the end of 2020 and Q1 2021 business, but this has been factored into NII guidance for Barclays UK.

Nicholas Campanella of Barclays inquired about Hawaiian Electric Industries' strategy for financing the second installment of the Maui wildfire settlement and asked for a timeline on when the company would provide an updated CapEx and rate base growth forecast.

Answer

Scott DeGhetto, EVP, CFO & Treasurer, stated that the company intends to raise funds for the second payment in the first quarter of the following year through debt or convertible debt at the HEI holding company level. He also indicated that a new forecast for CapEx and rate base growth should be available around the November 2025 timeframe.

Nicholas Campanella of Barclays inquired about Hawaiian Electric Industries' strategy for financing the second Maui wildfire settlement payment and the timeline for providing updated guidance on CapEx and rate base growth.

Answer

EVP, CFO & Treasurer Scott DeGhetto explained that the second settlement payment will be financed at the HEI holding company level with debt or convertible debt, likely in the first quarter of the following year. He also indicated that updated CapEx and rate base growth guidance is expected in the November 2025 timeframe.

Nicholas Campanella of Barclays inquired about Hawaiian Electric's strategy for funding the second Maui wildfire settlement payment and the expected timing for issuing a new capital expenditure and rate base growth forecast.

Answer

EVP, CFO & Treasurer Scott DeGhetto explained that the company plans to raise funds for the second settlement payment in the first quarter of the following year, likely through debt or convertible debt at the HEI holding company level. He also indicated that a new CapEx and rate base outlook would likely be provided in the November timeframe.

Nicholas Campanella from Barclays inquired about Hawaiian Electric Industries' strategy for financing the second Maui wildfire settlement payment and the expected timeline for releasing an updated capital expenditure and rate base growth forecast.

Answer

Scott DeGhetto, EVP, CFO & Treasurer, explained that HEI plans to raise funds for the second settlement payment in the first quarter of the following year. He specified the financing would occur at the holding company level through straight or convertible debt. DeGhetto also indicated that a new CapEx and rate base growth outlook would be provided around November of the current year.

Nicholas Campanella asked about the expected evolution of regulatory lag through 2028 following the current rate case, the total generation capacity unlocked by the new pipeline, and whether the gain from the Eldorado investment was included in the initial guidance.

Answer

President, CEO & Chairman Ted Geisler outlined the timeline for regulatory lag reduction, noting the first formula rate adjustment could be filed in 2027 for rates effective in September, with 2028 being the first potential full year of updated cost recovery. He also clarified the pipeline supports a 4.5 GW committed queue and helps address a nearly 20 GW uncommitted queue. CFO Andrew Cooper explained the Eldorado gain was not part of core planning but contributed to confidence in the upper end of the EPS range.

Nicholas Campanella from Barclays inquired about the impact of TSMC's expansion on the long-term C&I sales forecast and the financial implications of the newly disclosed $3.0-$3.5 billion CWIP balance.

Answer

CFO Andrew Cooper clarified that TSMC's Fab 1 is now fully reflected in the forecast, while the acceleration of Fabs 2 and 3 points to a robust future pipeline beyond the current guidance. He explained the CWIP disclosure highlights long-term projects like strategic transmission and generation, providing clarity on growth potential beyond the current 3-year plan, even though it doesn't generate a cash return until placed in service.

Nicholas Campanella asked for quantification of the ROE lag expected in 2025, the timeline for potential relief from a new rate case, and clarification on the updated equity financing plan.

Answer

CFO Andrew Cooper explained that while increased CapEx in tracked mechanisms helps, lag persists from non-tracked costs and operating expenses. He did not quantify the exact ROE lag but emphasized the focus on the regulatory lag docket. CEO Jeffrey Guldner added that the earliest a new rate case could be filed is mid-2025, with new rates likely effective in mid-to-late 2026. Cooper clarified that the new $700M-$900M equity need is separate from and in addition to the undrawn $725M block from February 2024.

Nicholas Campanella of Barclays asked how New Jersey's need for new generation and focus on affordability might affect PSEG's ability to secure a multi-year nuclear contract by year-end. He also questioned if recent capacity auction results position the company higher within its earnings guidance range.

Answer

Chair, President & CEO Ralph LaRossa affirmed the goal of a year-end deal but emphasized it must be a quality agreement, noting resource adequacy is a PJM-wide issue. Both LaRossa and EVP & CFO Daniel Cregg reiterated that the company's 5-7% CAGR guidance remains based on the nuclear PTC threshold, as capacity prices are only one part of the revenue equation.

Nicholas Campanella of Barclays asked about the potential scale of a data center contract, specifically if PSEG would consider selling up to a third of its nuclear capacity. He also inquired about the assumptions for the upcoming PJM capacity auction embedded in the company's 5% to 7% growth forecast.

Answer

Ralph LaRossa, Chairman, President and CEO, stated that it was premature to discuss the size of a potential deal due to many variables. Daniel Cregg, EVP and CFO, added that while the long-term forecast includes assumptions for the PJM auction, the company's overall growth is not highly sensitive to the outcome because capacity revenue is not a significant component of the nuclear fleet's total revenue mix.

Nicholas Campanella of Barclays inquired about the potential timing and earnings impact of direct power sales from PSEG's nuclear facilities to data centers, and what state policy developments investors should monitor.

Answer

Chair, President and CEO Ralph LaRossa stated that the timing is dependent on hyperscalers and state policy initiatives, particularly the governor's efforts to attract an AI hub to New Jersey. LaRossa emphasized that PSEG's role is to support, not set, state policy and that any potential data center PPA would be an upside to the current plan, which is based on the PTC floor.

Nicholas Campanella inquired about the potential timing of announcements for direct power sales from PSEG's nuclear facilities to data centers, the possible EPS contribution, and what state-level policy signals investors should monitor.

Answer

Chair, President and CEO Ralph LaRossa explained that the timing for any data center deal is contingent on the hyperscalers' schedules and state policy initiatives, advising investors to follow official state announcements. He emphasized that this opportunity represents incremental upside and is not factored into the current financial plan, which is based on the nuclear PTC floor. Any definitive agreements would be incorporated into the forecast once finalized.

Sai, on behalf of Nick Campanella, inquired about the timing of the remaining 1.3 GW of projects for 2025 and their financial impact, the potential to extend guidance to 2028, and the company's view on its valuation amid acquisition rumors.

Answer

COO Ricardo Falú stated most remaining projects would come online in Q3 with a small portion in Q4. CFO Stephen Coughlin added that tax attributes would be split between Q3/Q4 and that guidance would likely be extended in February 2026, expressing confidence in the post-2027 outlook. CEO Andrés Gluski commented that AES has been consistently undervalued given its strong backlog, execution, and strategic flexibility as an "all of the above" energy provider.

Nicholas Campanella asked for more detail on the insurance sale's financial structure, including dividend timing and the cost of financing, and also inquired about the rationale and valuation for the Cochrane asset buyout in Chile.

Answer

CFO Steve Coughlin clarified that the insurance sale's target distributions are an aggregate 5-year number and the financing cost is comparable to junior subordinated debt, making it an accretive, low-cost equity source. Regarding the Cochrane buyout, Mr. Coughlin explained that AES acquired the remaining 40% minority stake in an asset it already operates at a very low, accretive multiple, securing a valuable long-term contracted asset in Chile.

Nicholas Campanella inquired about the nature and source of the announced $150 million to $300 million cost savings, and how AES plans to achieve its long-term EBITDA growth targets despite reducing capital expenditures, questioning the expected IRR on new, higher-quality renewable projects.

Answer

CFO Stephen Coughlin confirmed the cost savings are ongoing run-rate reductions spread across the portfolio, with actions already taken to ensure their achievement. CEO Andrés Gluski explained that the growth strategy is an integrated approach, focusing on fewer, larger, and more profitable renewable projects with higher IRRs, which, combined with cost reductions, maintains the financial outlook.

Nicholas Campanella of Barclays inquired about AES's confidence in meeting its 14-17 gigawatt PPA signing target by 2025 and the drivers for 2025 earnings growth, particularly the split between a return to normal conditions and new project contributions, especially after the sale of the Brazil assets.

Answer

President and CEO Andres Gluski affirmed strong confidence in their supply chain and construction program, stating they are on track to meet their PPA targets. He and CFO Stephen Coughlin explained that 2025 growth will be driven by both a 'return to normal' from 2024's extreme weather and significant contributions from nearly 3 gigawatts of new U.S. renewables coming online, which more than absorb the impact of the Brazil sale.

Nicholas Campanella asked about the regulatory status of a potential upsizing of Meta's Hyperion data center and questioned the current framework for developing new nuclear power, including risk management strategies.

Answer

Chair and CEO Drew Marsh stated that no regulatory process has begun for a Hyperion expansion and directed questions on future plans to Meta. Regarding new nuclear, Marsh explained that Entergy's operating companies cannot bear the construction risk alone and are exploring risk-sharing partnerships with customers, government entities, vendors, and even sovereign funds, though a definitive framework is not yet in place.

Nicholas Campanella asked if the strong start to the year suggests Entergy is trending higher within its 2025 guidance range and inquired about the potential for a settlement in the Louisiana new customer generation filing.

Answer

CFO Kimberly Fontan responded that the strong Q1 provides flexibility to manage business uncertainty, like summer weather, but the company remains comfortable with its current outlook. CEO Drew Marsh stated that while a settlement in the Louisiana filing is always a possibility and preferred, the company is confident in its position and the current schedule, noting broad support for the investment.

Nicholas Campanella asked for a simplified framework to understand how each new gigawatt of data center load could impact the company's growth CAGR and questioned Entergy's appetite for inorganic M&A given its substantial organic growth pipeline.

Answer

CFO Kimberly Fontan explained that a simple one-to-one correlation is not possible, as growth is driven by the unique investment required for each customer. CEO Andrew Marsh added that different data center business models also yield different outcomes. Regarding M&A, Fontan reiterated that any transaction must meet their strict criteria of creating value and being executable, without commenting on specific opportunities.

Nicholas Campanella questioned the sustainability of the 8-9% EPS growth rate beyond 2028 and sought more information on the strategy for advanced nuclear, including whether it would be a regulated, multi-state effort.

Answer

Executive Andrew Marsh stated that long-term growth is driven by strong macro trends like onshoring and electrification, with an active pipeline of large customers. On nuclear, he explained that while no specific project is announced, Entergy is actively engaging with a broad group of stakeholders to navigate the policy benefits and first-of-a-kind challenges.

Nicholas Campanella of Barclays asked if the RFP repricing could be additive to the rate base CAGR and how the new distribution filing might change the nature of future rate cases, potentially making them less onerous.

Answer

CFO Joe Trpik explained that the RFP reprice underpins the company's illustrative growth and drives certainty, rather than being directly additive to the base plan. CEO Maria Pope and CFO Joe Trpik both characterized the new regulatory filings as steps toward a more predictable, multi-year framework developed in collaboration with stakeholders.

Nicholas Campanella requested the updated rate base growth metrics that support the 5-7% long-term EPS growth outlook, particularly what drives performance to the high end. He also asked about the expected cadence of improvement for the common equity ratio.

Answer

Senior Vice President of Finance and CFO Joseph Trpik clarified the updated rate base growth is now 7-9%, down from 8-10% due to rebasing and ITC treatment, not a change in fundamentals. President and CEO Maria Pope added that future RFPs are not yet in the base numbers and that transmission investments are a key addition. Trpik also stated the equity ratio should see a methodical, consistent move upwards through 2027.

Nicholas Campanella questioned the likelihood of settling the current rate case versus litigation, how the company is balancing customer affordability with increasing CapEx, and the capital deployment timeline for the upcoming 2025 RFP.

Answer

SVP & CFO Joe Trpik indicated that while settlement discussions are ongoing, the company is prepared for litigation. He explained that new resources often provide customer benefits and that ITCs help with affordability, with RFP projects being largely incremental. Trpik also projected that assets from the next RFP would likely come online around 2028.

Questioned when Sempra's EPS growth might exceed its 7-9% CAGR range, and asked about the possibility of selling more than 30% of SIP and the valuation confidence amid current market conditions.

Answer

The company did not specify a year for exceeding the EPS CAGR but expressed confidence in reaching the high end or above, citing the now more certain $12B in incremental Oncor CapEx that is not yet in the forecast. On the SIP sale, the company is open to ideas that create the most value, even beyond the 30% scope, and is confident in the valuation.

Nicholas Campanella asked whether Chesapeake Utilities can achieve the midpoint of its 2025 EPS guidance following the delay of the WRU project's margin contribution.

Answer

President and CEO Jeffrey Householder reaffirmed the full-year guidance range, stating the company can manage the WRU margin impact but that the final position within the range is yet to be seen. EVP and CFO Beth Cooper added that robust Q1 capital investment and the commitment to the target capital structure are factors that will influence where they land within the guidance range, reaffirming guidance despite the WRU delay.

Nicholas Campanella inquired about the potential impact of tariffs on the auto sector, the general economic health of DTE's service territory, and the timeline for securing additional data center load.

Answer

Chairman and CEO Gerardo Norcia noted that tariff modifications on auto parts provided significant relief and that Michigan's economy remains resilient. EVP and CFO David Ruud added that underlying sales growth was strong after adjusting for weather and a leap year. President and COO Joi Harris confirmed data center discussions are active, with a 2.1 GW framework in place and a 3 GW pipeline, expecting final agreements by year-end.

Nicholas Campanella from Barclays inquired about DTE's load growth forecast, which is currently flat, and the legislative progress of the data center tax incentive bill. He also asked for an update on the likelihood of a settlement in the ongoing electric rate case.

Answer

Chairman and CEO Gerardo Norcia stated the current plan assumes flat demand growth but noted significant interest from data centers. He confirmed the data center tax bill has passed the Senate and part of the House, with expectations for it to be taken up in the lame-duck session. President and COO Joi Harris indicated a low probability of settlement for the electric rate case due to the high number of intervenors, but expressed confidence in achieving a constructive outcome in January.

Nicholas Campanella asked about DTE's confidence in derisking its 2025 business plan and beyond, and sought to quantify the strength and growth potential of the DTE Vantage business given tailwinds like tax credits.

Answer

Chairman and CEO Gerardo Norcia stated DTE is in a much stronger position for 2024 and is already deep into planning for 2025, aiming to increase headroom. He expressed confidence in the upcoming rate cases, which are focused on capital deployment. EVP and CFO Dave Ruud acknowledged tailwinds for Vantage from tax credits, noting it provides flexibility and confidence in the long-term 6% to 8% EPS growth target, with more specifics on 2025 to come at year-end.

Nicholas Campanella from Barclays asked about the potential reduction in equity needs from new customer agreements and questioned why, given the upside, the company is not guiding to growth above its 4-6% range.

Answer

Chairman and CEO David Campbell explained that finalizing the next set of customer agreements could increase load growth towards 4.0-4.5% and reduce equity needs by 'hundreds of millions of dollars.' He clarified that Evergy is taking a systematic approach, and will layer in the impact of new customers into its guidance only after they are officially announced.

Nicholas Campanella sought confirmation on the cost-sharing agreement for the Revolution Wind project and asked if the 5-7% EPS growth target would be rebased off the new 2024 guidance, and whether it includes proceeds from the Aquarion sale.

Answer

EVP, CFO and Treasurer John Moreira confirmed that Eversource has reached its cost cap on Revolution Wind, with any further overruns to be shared 50/50 with Orsted. He also affirmed that the Aquarion sale proceeds are integral to the financing plan supporting the 5-7% EPS growth rate, which they expect to rebase annually as per historical practice.

Nick Campanella of Barclays asked if the grid charges for front-of-the-meter deals could increase as T&D operators see more load, and how this would affect project economics. He also inquired about the company's capital allocation plans, specifically regarding share buybacks.

Answer

President and CEO Joe Dominguez reiterated his view that grid charges should remain in the low single-digit dollar per megawatt-hour range, emphasizing the issue is speed, not cost. CFO Daniel Eggers added that the company will provide a comprehensive financial update on the Q4 call, including rolling forward guidance and refreshing the two-year cash available outlook. He confirmed that Constellation will look to be in the market for buybacks when not restricted by material nonpublic information.

Asked how potential interest rate cuts might affect project returns and inquired about the feasibility of restarting the Duane Arnold nuclear plant to meet rising power demand.

Answer

The company explained that they actively hedge interest rate risk, so any rate cuts would be a tailwind, but their plans are not dependent on them. Regarding the Duane Arnold nuclear plant, they are evaluating a potential restart due to market demand but would only proceed if it could be done in a 'risk-free' manner with sufficient mitigants.