Q4 2020 Northwest Natural Holding Co Earnings Call
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I would now like to hear on the conference over to Nikki <unk> director of Investor Relations. Please go ahead.
Thank you Tom Good morning, and welcome to our fourth quarter 2020 earnings call. As a reminder, some things that will be said. This morning contain forward looking statements. They are based on management's assumptions, which may or may not occur.
In addition, some of our comments today reference non-GAAP adjusted measures for a complete reconciliation of these measures and other cautionary statements. Please refer to the language and reconciliation at the end of our press release, we expect to file. Our 10-K later today I've mentioned this teleconference is being recorded and will be available on our website.
Following the call. Please.
Please note. These calls are designed for the financial community. If you are an investor and have additional questions. After the call. Please contact me directly at 503 seven to 125 30 news media May contact Melissa Moore at five or three 220 24 36.
This morning are David Anderson, President and Chief Executive Officer, and Frank Burkhart, Snyder Senior Vice President and Chief Financial Officer, David and Frank have prepared remarks, and then will be available along with other members of our executive team to answer your questions with that I will turn it over to David.
Well, thanks, and good morning, everybody and welcome to our 2020 year end call well yours come and go from 2020 as we all know was on forgivable.
The pandemic affected many aspects of our daily on and I'm proud of the way our employees all together to provide our customers with superior service, we successfully navigated a number of challenges, while still achieving the financial and operational goals.
We reported net income from continuing operations of $2 30 per share for 2020 as driven by solid performance of the gas utility and a strong contribution from our new platform on water utilities.
On the gas operations from our field crews successfully handled everything from wildfires to restoring service in several channels over Christmas day, navigating COVID-19, social unrest et cetera.
Just a few weeks ago, our employees in the natural gas system. Once again rose to the occasion in providing reliable service through on extreme weather events are storage facilities and overall hedged positions work to mitigate the amount of gas purchase on the spot market and help to minimize the impact to our customers' bills.
This was an incredibly important as prices as everybody knows spiked across the country from the widespread cold snap our balance sheet remains strong with ample liquidity.
In 2020, we also executed on one of the largest capital programs from the company's history aimed at supporting reliability.
We continued to operate one of the most modern and highest systems on the nation a system that it has no cast iron and bare steel in 2020, we invested over $270 million and our natural gas infrastructure.
From an economic perspective, 2020 was truly unprecedented free.
I had to the pandemic, we had funds had a very fundamentally sound sustainable growing economy with record low unemployment, both nationally and in our service territory.
We continue to see economic recovery and steady growth in several important areas.
Portland unemployment right now at six 1%.
And in December actually essentially natural in the national rate that's down from a 14, 9% high in April single family housing activity remains strong in the Portland Metro region home sales were up eight 3% from 2019 with price growth of about 12% and new single family permits issued last year.
We're up 4% compared to 2019 levels.
And northwest natural we continue to see good customer growth.
New construction plus conversions translated into connecting over 13000 meters. During the last 12 months ended December 31.
Our overall customer growth rate as a result was 1.5% from the same period based on the strong single family home construction parsley, partially offset by the loss of some commercial customers due to the pandemic.
The rollout of vaccines is expected to ease pandemic related restrictions and allow businesses to reopen.
Still we know these are difficult times for some customers and we've worked very closely with commissions.
From the bed.
Best way to return to normal business practices. We've agreed the timelines for resuming collection processes and continue to evaluate the parties what makes sense for customers given the economic conditions, while also providing financial assistance on payment plans to vulnerable customers enhance the system includes bill forgiveness program and working with the Oregon.
Legislature to provide additional funding for bill relief.
To remark a variety of programs and agencies, we provided over $4 million to over 10000 households to pay their bills and stay warm during the last heating season.
We also David donated about $1 million to nonprofits and our communities and initiated a special COVID-19 employee giving campaign.
For Oregon previously approved new rates took effect on November one last year gas bills continue to remain low and our customers are paying about 40% less today from their bills and they did 15 years ago.
In addition in June we pass back a record $17 million in storage Bill credits to Oregon gas customers.
State safety reliability, and affordability make natural gas a preferred fuel source eight out of 10 homeowners on our service territory prefer natural gas. According to a study conducted in December 2020, there is a strong recognition that natural gas is affordable and efficient and preferable to electricity for heating and cooking in fact over 80.
Percentage of respondents said they would pay $50000 more for a home that has gas amenities over an all electric home.
Customers also show their appreciation by ranking northwest natural second on the west among large utilities in the 'twenty 'twenty J D Power's residential customer satisfaction survey.
And then finally, our board approved a dividend increase in the fourth quarter, making 2020 to 65th consecutive year of annual dividend increases were provides we're proud to provide the return to shareholders and be one of only three companies on the NYSE, but that long record with that let me turn it over to Frank to give a little bit more detail on the financials Frank.
Thank you David and good morning, everyone I will begin by discussing the financial impacts of COVID-19, and the highlights of the fourth quarter and full year 2020 results and then conclude with guidance for 2021 in 2020, our utility commissions approved COVID-19 deferrals and term sheets that up by the types of revenues and costs that may be recovered.
These include PPE bad debt expense financing costs associated with additional liquidity and certain lost revenues direct expense reductions such as lower travel and meals and entertainment are to be netted against the deferral Prudency review and recovery of the deferral accounts will be determined in future proceedings.
While our business model is resilient, we are experiencing some financial impacts related to the pandemic through December 31st we incurred an estimated $10 million pre tax of incremental costs and lower revenues due to the effects of COVID-19 of this $4 $8 million were deferred Deregulatory accounts. In addition, $1 3 million.
Of late fee revenue that has not been charged to customers since the suspension of normal collection processes will be recognized in a future period, when we begin to recover the forgone fees through rates.
The remaining $3 $8 million that cannot be recovered through rates are primarily due to lower natural gas utility margin from customers that stopped service and slightly lower usage from customers that are not decoupled.
In order to further mitigate the financial impacts of the pandemic, we initiated temporary cost savings measures, which provided approximately $3 $5 million of savings in 2020 in.
In summary, the total P&L impact of Covid in 2020 was $1 $6 million.
Turning to our detailed financial results I'll.
I'll describe earnings drivers on an after tax basis using the statutory tax rate of 26.5% also note that year to date earnings per share comparisons reflect the successful issuance of one 4 million shares in June 2019, as we raised equity to fund investment in our gas and water utilities.
As a reminder, northwest Natural's earnings are seasonal with a majority of revenues and earnings generated in the first and fourth quarters during the winter heating season for.
For the quarter, we reported net income from continuing operations of $45 $8 million or $1 50 per share compared to $38 $3 million or $1 26 per share for the same period in 2019, the gas utility posted an increase of <unk> 19 per share related to new rates in Oregon, beginning November one 2020.
Offset in part by higher depreciation and general tax expense and the impacts of COVID-19.
Contribution from our other businesses increased five cents per share from the water assets, we acquired in Washington, and Texas and lower expenses at the holding company.
Utility margin in the gas distribution segment increased $11 $5 million from the benefit of new rates in Oregon and customer growth.
The offset by the effects of COVID-19.
Utility O&M decreased $500000 in the quarter, reflecting cost savings efforts I am proud of our employees, whose hard work and commitment allowed us to accomplish this while still providing exceptional service depreciation expense and general taxes increased $2 $9 million related to the ongoing investment in our system.
For the full year 2020, we reported net income from continuing operations of $73 million or $2 30 per share compared to net income of $65 $3 million from $2 19 per share for 2019 2019 results included a regulatory disallowance of <unk> 22 cents per share related to an order.
Again Commission order on tax reform and pension expense.
Excluding that disallowance on an adjusted non-GAAP basis earnings per share from continuing operations was $2.41 for 2000 1911 cents per share decline is largely due to year over year growth in expenses and the effects of COVID-19 and the positive effects of weather and pipeline constraints on 2019 results in the gas distribution.
Utility margin increased $11 $3 million higher customer rates in Oregon, and Washington customer growth and revenues from the North Mist expansion project contributed an additional $21.5 million.
This was offset by lower entitlement and curtailment fees related to pipeline constraints in 2019 and warmer weather in the first quarter of 2020 compared to 2019, which collectively reduced margin by $4 $5 million utility margin also declined $1 million due to lower revenues from late fees as we suspended normal collection processes.
The remaining $5 $2 million decline in utility margin is a result of the 20th 19, Oregon order with the exception of the first quarter pension Disallowance. This order has no impact on net income as offsetting adjustments were recognized through expenses and income taxes as I'll describe in a moment.
Utility O&M and other expenses declined $5 $4 million. This decrease is associated with the Oregon order, which resulted in $14 million of additional expense in the first quarter of 2019 as discussed previously this was offset by a $6 million increase in underlying O&M related to higher compensation costs contractor and professional.
Service expenses as well as moving costs. This was partially offset by the management driven cost savings measures. I described earlier pension expenses included in other expense increased $2 $8 million. However, this expense is not recovered in rates over.
Over the last several years, we have invested in our gas system at historically high levels as a result, depreciation expense and general taxes increased $10 $2 million.
Finally utility segment tax expense in 2019 included a $5 9 million dollar benefit related to the implementation of the Oregon order with no significant resulting effect on net income.
Net income from our other businesses increased $2 $2 million from higher earnings from the wastewater water and wastewater utilities and lower expenses at our holding company, partially offset by lower asset management revenues.
A note on Capex, we invested $294 million into the business with $273 million of gas utility capital expenditures and $38 million for water acquisitions, our balance sheet remains strong with ample liquidity.
With regards to the ongoing effects of COVID-19, approximately 97% of our commercial and industrial customers are current with their bills. Nonetheless, we have seen some commercial customers go out of business and shut off their meters as they've been negatively impacted we will continue to monitor closely monitor usage levels and commercial customer losses. We will also continue to be disciplined rigor.
<unk> cost management in an effort to mitigate these circumstances.
Moving on to 'twenty 'twenty, one financial guidance gas utility capital expenditures for the year are expected to be on a $280 million to $320 million range, including significant projects related to system reinforcement resource center renovations across our service territory and technology upgrades. The company initiated 2021 earnings guidance.
In the range of $2 40 to $2 60 per share guidance assumes continued customer growth average weather conditions and no significant changes in prevailing regulatory policies mechanisms or outcomes or significant changes in laws legislation or regulations with that I'll turn the call back to Mr. David Alright, well. Thank you Frank.
While the past year held challenges our focus remains the same providing superior customer service maximizing returns from our strong and growing regulated natural gas utility and diversifying our business by investing in the water sector. We made progress on that last front with the sale of two investments that were no longer central to our strategy and AGA.
We sold our interest in the trail West pipeline project and in December we completed the sale of the Gill Ranch storage facility in California proceeds from the sales are expected to be reinvested in our gas and water businesses. This.
This past year, we reinforced our decision to build a water and wastewater utility platform and highlighted the value we bring and can create in this sector, our water and wastewater utilities experienced organic customer growth of almost 3% 2.8 to be exact over the 12 months ended December 31st 2020, We also completed infrastructure improvement.
And filed our first water utility general rate case.
Though COVID-19 temporary slowed acquisition are temporarily closed acquisition activity slowed excuse me temporarily slowed acquisition activity, we were still able to add a water and wastewater utility Washington to our portfolio and made our first acquisition in Texas, and we continued to make smaller acquisitions within our existing footprint while pursuing new.
Expansion opportunities I remain I continue to mine very excited about the investment potential in this business.
Another key pillar of our strategy is aggressively pursuing a renewable future and working to Decarbonize, our gas utility system.
Before I take you through our approach it's important to remember our starting point northwest natural serves about 74% on the residential square footage in our service territory and meets 90% of our space and water heat customers energy needs on our coldest days yet the emission emissions associated with that use accounts for only 6% of Oregon's total greenhouse gas.
<unk> in the northwest the gas and electric system have concurrent peaks in the winter the gas system delivers about twice as much energy during the peak then the electric system with even more capacity available.
This advantaged positions us well to help drive.
Drive the carbonization on the region in a way that ensures reliability and affordability and as we have seen in recent weeks one can never underestimate how important reliability is during the winter.
Let me walk you through three components of our vision of carbon neutrality by 2051st we intend to continue to pursue aggressive energy efficiency to lower energy usage in the past 40 years, the number of residential gas natural gas customers in the U S has grown by almost 90%, but demand has remained flat, which is a testament to the industry and <unk>.
How well they foster continued efficiency.
Our residential customers today use half of the amount of natural gas that they use the 1970, despite consistent growth on the average size of homes and more appliances per home.
Second were striving to integrate renewable natural gas from a variety of waste streams into our system.
Technical potential of RMG supply in Oregon alone is estimated to be nearly 50 billion cubic feet.
About the same amount as all of the residential gas throughput in our state.
Dash nationally early estimates show about 14 trillion cubic feet of technical potential or about 88% of all throughput clearly theres bass technical potential now we need to collectively focus on getting as much as we can't market economically.
We also see the potential for hydrogen being added to the pipeline. We believe there are three applications for of hydrogen from the power to gas process blended masonite and dedicated hydrogen systems. We also envision the possibility of blue hydrogen made from natural gas and paired with carbon capture utilization and storage as playing.
<unk> role in the U S gas system, and we're watching Europe, Canada, and Australia efforts Australia's efforts in this area.
In 2019 Northwest Natural center technical team to Europe to meet with government agencies think tanks and gas companies and we learned a lot about new technologies projects and policy. It was clear Europe is many years ahead of the U S and they're thinking about the gas networks system and the role of green molecules in the energy transition that.
We're all going to go through.
Once they realized gas infrastructure, which is already in place is a huge advantage.
One Great example of business storage.
The natural gas infrastructure is built to provide long duration energy storage that doesn't degrade it can store orangey nominated renewable hydrogen today in existing facilities and when we think about decarbonization strategies across the energy sector. The fact that the infrastructure already exists and has significant cost advantages is incredibly important and Mike.
Thank you.
For example, northwest natural has 20 billion cubic feet of underground storage today, that's equivalent to store and about 6 million megawatt hours of renewables into.
In today's cost that would be about a two trillion dollar lithium battery.
And this is where policy is key to helping us leverage our existing infrastructure in new ways and accelerate our regions de carbonization efforts.
In Oregon, we have Senate Bill 98, the first of its kind renewable natural gas legislation that says 30 year targets for gas utilities to procure R&D and renewable hydrogen for customers. We just announced our first R&D investment on a bill and are actively working on more.
Northwest natural has started hydrogen blending testing at our training facility and we're working with Eugene water and electric board in Oregon to propose a project that would include met the native hydrogen for our system. We're excited about these early steps and are committed to pushing for solutions that include system resilience as part of the energy transition.
Now more than ever it is clear to us how critical our gas infrastructure is to furthering our collective climate goals, while also ensuring energy system diversification and reliability for the communities we serve.
So thanks for joining us this morning, Tom with that we'll open it up for questions.
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Okay.
And the first question comes from Chris Allen House with Cedar Williams. Please go ahead.
Everybody from one how are you.
David can you talk a little bit about the Texas crisis, and how you think that will help with.
On the electrification diversification de carbonization education process that you seemingly have to go through.
With municipalities and legislators today.
Yeah, Chris Thanks for the question and as you know, Texas is my home state.
Really my heart goes out to what did all of the all the took place down there and it's a it's a very very sad situation.
But with that said I think we all need to make sure that we look at that and we learned from that I think it proves.
A point that I've been making for a long period of time as you need to have resiliency of systems and redundancy and systems and not have all your eggs in one basket.
On a big fan of electricity, it's where I started my career.
But the natural gas infrastructure is also critically important aspect of that and I think when you apply it to even our current region Chris.
Chris we have some very severe electric outages appear on the electric company worked very hard and diligently diligently to get everybody on but if you had natural gas.
You had the ability to hedge your gas fireplace work you'd have the ability to have.
Cooking in place and I know in my own household that was greatly appreciate itself it.
It is my hope that we all learn from these and we understand that the infrastructure that's in place.
I don't I'm, not as close to Texas, Chris anymore, as I used to be 17, 18 or years ago, but I do know in our region.
I want to make sure policymakers are making good decisions and ensuring that we are prepared for those events because they will happen. If you believe in climate change.
It believes it which I do it shows that extreme weather events like this are going to continue to happen. So we need to make sure that we're doing all we can.
To provide these services to our customers so that they stay warm on those coldest days.
In Washington, the electrification.
Bill that failed.
You probably had some interaction with with that group of legislators.
Were they well educated at the point that they brought that bill.
Well the bill was brought by a <unk>.
Freshmen legislators so he was brand new to the process.
And I I'm not going on.
Guests, whether he was educated or not but I will tell you like a lot of times, what happens is bills or put in the Hopper and then things are figured out after that the Permian the hopper and once once that happened there was a tremendous amount of.
Pushback on the Bill everything from building trades, electricians gas unions business and industry associations grocery stores homebuilding restaurants utilities there.
I kind of pointed out.
The Bill is as it was currently written.
It was really probably not.
Not a good outcome for the region.
And I think once more people.
And looking at it then they decided not to move the bill forward at this time, so I am cautiously optimistic Chris that that will stay that way are you you mentioned the word dead I don't think bills are ever day.
But I think at this juncture. It does look like it's not going to move forward.
Okay.
David Youre also saying that Europe is much further ahead on the hydrogen side than we are.
I was going to ask you when you thought we'd get a lot of hydrogen data. So companies can start to make some decisions on the hydrogen.
Estimate.
But really why is why are pilots necessary here at this point.
If there is a lot of information from Europe available.
Well I'll start and then I went on I want to turn it over to Kim hiding to talk a little bit more about what you saw in Europe, but I will tell you.
You know, Chris you know I'm old enough to be her when the electricity.
Went renewable and we did we had wind and solar down in Texas, and the only way that the electricity system got to where it is today, where the amount of renewables is with policy support.
And that's what we need here in this country and I think Europe's ahead of us because they've had policy support I think they went down the path of electrification figured out pretty quickly or maybe not quickly, but figured out that that that was not a doable path I think they understand the value of the gas infrastructure. So I think there's a.
<unk> of an education process here Chris.
To work with policymakers to make sure that they understand the energy systems the.
The importance of those energy systems going forward and that these energy systems can be clean and green, if you will but Kevin anything you would like to add on to that.
No I think you covered it well I mean net and you had asked you know why do we need pilots low part of our our challenges remain that policy Albert latex salary.
Bringing these technologies that are true then actually scale and yeah. That's one of the net.
You know areas.
Areas of focus for us in the Eugene project effort.
We're working toward with Eugene ladder, and electric born and Bonneville Environmental Foundation.
On trying to make sure we can demonstrate the technology here on the nomination technology, that's already on being applied in Europe, and beginning to be applied in Canada. So that we can then asked before that net GAAP, which is really that that party or really any David mentioned on the federal level. There I think you're on.
<unk> eight level that we would like to be you know overtime.
Treatment of nomination of Clinton on our electric on either as we do battery and in a range right contract lapses.
<unk> I think possibilities and and we're certainly very pleased to see the level of interest.
Right now around R&D and hydrogen into the gas networks in weeks on the ground.
Okay. One last question as far as.
<unk> announced that you had earlier in the year.
If you would be expecting.
A stream of these types of announcements from you guys.
Chris when we look at what we've been doing is the utility to do everything we can to Decarbonize our system on we've got the tightest system on the country, we've been working with our upstream producers to lower their footprint or only buy from responsible producers. The last piece of that pie is to decarbonize the product going through our pipe and we will move.
<unk> aggressively on this front to do all we can on that that line. So I hope the answer is yes.
To your question is that we would like to get as much renewable product on the pipeline as we possibly can.
Okay. Thank you very much I appreciate the color gross.
Gross having a weekend.
Yeah.
The next question comes from Selman <unk> with Stifel. Please go ahead.
Thank you Hello, hope everyone's doing well.
Couple of quick things I mean first of all can you just make some comments centered around how the water assets performed at Texas.
Yeah, I think I'll start on the adjusted saw from interim president of the waters on.
In general we are very pleased with our Texas assets and we're trying to add more.
Those assets as we possibly can and Covid as I mentioned in my prepared remarks has kind of slowed down the acquisition activities just for safety reasons on both sides of the on.
At the table, but adjusted you wont talk a little bit I know a lot of people saw the freeze offs and things like that and give an update on what we saw on our operations.
Yes, absolutely.
Texas water operations were impacted similarly to many other utilities last week.
Our team reacted very quickly there are power outages that affected some of the service.
And resulted in some some freezing over and bursting pipes within about half.
Of our overall systems and affecting about half of our customers. We were able to restore water service generally within 24 to 48 hours.
On our systems.
And.
And get get customers back online very rapidly relative to most of the other utilities in the state. So we were very pleased to see that response from our team down there.
Great. Thank you for the update.
In your opening comments, you referenced I guess increase gas demand as well as prices.
In the first part of the quarter.
With the goal of any no reason for us to be anticipating anything from needing relief from a regulatory standpoint or anything.
In terms of incremental bad debts or anything of that nature.
No Selman weight.
We got hit a little bit for the rest of the country did with the system and we did get pretty cool, but not like not like Texas and Arkansas did.
But we did we did have some additional purchases and things like that but we also had some things that offset that or storage facilities worked fairly well.
And so we're in good shape, so where you're.
In a situation that some of my on my peers around with the unprecedented liquidity issues that they've had to finance we're in good shape.
Glad to hear that and then just the last one from me.
You guys referenced are testing, 5% hydrocodone hydrogen blend at your trading facility can you just talk about how that's going on.
On pipes leakage anything to be.
Noteworthy coming out of that.
Tim you on them.
Yeah, we're really pleased last Oh, well I should back up when we when we took our check here at we were really in the latter.
<unk> D and kind of where they were with their testing protocols.
Fast forward we.
Started to build out our on Atlanta trying to comp and we're starting at our training facility in Germany, where again, we have background on building.
Our training town, we call it.
That's a really good spot to do this kind of tax gain so on last call. We began the 5% blend.
And we were really focused on looking at assets.
Detection equipment and the performance of DAC, but net.
We were really pleased we also purchased a hydrogen blending leak detection.
But net of cash that performed as expected. We've now moved on to testing the blender and used equipment sales.
Excuse me fireplaces by Peter.
And thus far we haven't seen anything unexpected we've been really pleased that we're building out this testing plan for the rest of the year.
Yeah.
And our goal is to be serving the entire facility.
Alright.
The ability with that 5% land by the end of the year.
We're also working with others in assets.
Hi, Blake.
Organization, where we're sharing technical data, it's a huge database really.
Brilliant.
Internationally that are doing hydrogen blend doing some technical analysis not just on the pipe and the components in the end use of Clinton net off the line on.
The effects of different plants and storage facilities.
We're taking all of that learning and applying those into our plan.
The final step alethia.
Something probably in the near term is to begin doing system on it on our assistance is look at where our great locations for blended different percentages based on the characteristics.
And maybe the areas that we're serving so.
Lots going on on Aladdin exciting work on <unk>.
Our parents, who are also collaborating with that and that's all on the Blender and you might just mentioned about mirth notice on that yet.
But the difference between blending in the Mirth noted side, Yeah, we do three as David mentioned in his remarks, three applications of hydrogen and honestly blending we think the blending will probably be cash between 'twenty and maybe 30% at the very high end.
Before you have issues with any of the clat marry our Pac component and then of course dedicated hydrogen system and think about the two industrial facilities are even on overtime to key's new community, which is interesting in the U K and in that case, you obviously had.
GAAP and components and equipment that were built specifically Q deliberate hydrogen you don't have any.
Limitations on the amount of hydrogen you complete and the pipe, but the one that I think we're really interested in the near term is machination of hydrogen because you can take rate the on Q from an industrial facility on power Gen facility apply that to the power to gas process and Anthony at hydrogen at that point and as interchangeable.
When conventional natural gas mileage from you can also use biogenic sources so let.
Per our renewable natural gas facility with an electrolyzed, there and create mezzanine and hydrogen and so we believe that all of those applications will be in play and their advantage in.
Each one of them that we see being critical parent again with renewable natural gas.
It is to that.
Neutrality in 2015, we're right now doing some scenarios around what kind of components.
Different tool will be necessary and planning around that.
Got it and I apologize I'm, just going to ask one more.
But in your comments you talked about I guess government policies in support and I'm, just wondering David with anything with your HVA Chairman hat on is there anything you can talk about plans from there to maybe help that along.
Yeah, No Selman. Thank you I mean, the policy support I think can come in various ways. I mean number one you can see what we did here in Oregon, where the renewable natural gas build what we call Senate Bill 98, So I think theres opportunities at the federal level to hopefully do something like that.
But yes that is one of the reasons I agreed to serve as the chair. This year is to help drive some of this support now support can come in the form of a tax credits and things like that but it can also come in the support of other.
Ways.
Helping the industry move forward.
I am pleased to see that the by the administration has mentioned hydrogen and some of the discussions I've had I was on the call David David with the speaker or excuse me later, Schumer and I pointed out some of the issues.
That we need to have the kind of transition this system so as.
As Chris asked me about Texas again, I Hope this is an opportunity for all of us to kind of look forward and say how do we build the most resilient.
Energy system, we already have it in this country, how do we make it better and how do we make it cleaner.
And I think there's I think there's just a great opportunity at the federal level and I would argue that the state's levels too I think we need to to continue activities at all of the states and specifically the state that I'm part of here. The Kinder to can continue to move and not only at the state level, but at the federal level, whatever we can to support this transition.
Thank you once again.
Thanks, Tom.
This concludes our question and answer session I would now like to turn the conference back over to David Anderson for any closing remarks.
Well, thanks, Tom and thanks, everybody for joining us on a Friday, thanks for those great questions by the way.
But if you have any questions Nikki smartly, which you've got her contact information is your is your point of contact and on the media side, Melissa more kind of both of the bulk of their information from the press relations with that we will go ahead and sign off and everybody have a great safe and warm weekends.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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