Q1 2025 Fortis Inc Earnings Call
Thank you for standing by. This is Michael, the conference operator. Welcome to the Fortis Inc. First quarter, 2025 earnings conference call and webcast. As a reminder, all participants are in lesson only mode and the conference is being recorded.
After the presentation, there will be an opportunity to ask questions
To join the question to you, you may press star than one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star than zero. I would now like to turn the conference over to Stephanie Amaimo, Vice President, Investor Relations. Please go ahead, Miss Amaimo. I'll be back.
Stephanie Amaimo: Thank you, Michael, and good morning, everyone. Welcome to Fortis' first quarter 2025 results conference call.
Speaker Change: I'm joined by David Hutchens, President and CEO Jocelyn Perry, Executive VP and CFO , other members of the senior management team as well as CEOs from certain subsidiaries. Before we begin today's call, I want to remind you that the discussion will include forward-looking information, which is subject to the cautionary statement contained in the supporting slideshow.
Speaker Change: Actual results can differ materially from the forecast projections included in the forward looking information presented today.
Speaker Change: non-GAAP financial Measures Reference in our Procredor Marks are reconciled to the related US GAAP financial Measures in our first quarter of 2025 and DNA. Also, unless otherwise specified, all financial information reference is in Canadian dollars. With that, I will turn the call over to David.
David Hutchins: Thank you and good morning everyone. We are off to a strong start in 2025. During the quarter we delivered safe and reliable service to our customers while successfully executing on our capital plan by investing $1.4 billion in our utility systems.
David Hutchins: Financially, we reported earnings per share of $1, representing a $0.7 increase over the same quarter last year. And on the regulatory front, we received a constructive outcome in British Columbia on Fortis BC's multi-year rate framework.
David Hutchins: Our 2025 capital plan remains on track, with 27% invested in the first quarter, and with our $26 billion five-year capital plan focused on transmission investments at ITC, the resource transition in Arizona, and investments that strengthen our infrastructure and support customer growth across all of our utilities.
We are positioned well to deliver on our growth strategy.
David Hutchins: We expect rate-based to increase by approximately $14 billion to $53 billion by 2029, supporting average annual rate-based growth of 6.5%.
David Hutchins: As we advance our five-year capital plan, we are closely monitoring changes in government policies including terrorists and their potential impacts on inflation, supply chain availability and general economic conditions.
David Hutchins: Based on our initial assessment, we don't expect significant near-term impacts to our 2025 capital plan.
David Hutchins: In the event, tariffs result in higher cost. We would expect to recover the impacts through normal regulatory mechanisms. We will be mindful of the impacts on customer affordability should tariffs result in higher cost that persist over the long term.
David Hutchins: We continue to actively pursue incremental investment opportunities, particularly at ITC and Tucson Electric Power.
David Hutchins: At ITC, the team continues to work on the $3.7 to $4.2 billion of capital expenditures for MISO LRTP Tronch 2.1 projects located in Michigan and Minnesota, where rofers are in effect and for system upgrades in Iowa.
David Hutchins: As a reminder, the majority of these investments for tranche 2.1 are expected beyond 2029.
David Hutchins: Well, the legislative session proceeds in Iowa. We also continue to advocate for Roefer legislation as part of the governor's energy bill, as there is still time to get it approved before the legislature adjourns.
David Hutchins: Beyond the miceaw LRTP projects, ITC has sizeable opportunities for load interconnections.
David Hutchins: This includes the Big Seater Load Expansion Project as well as the potential for over 5,000 megawatts of additional load as several proposed data center and economic development projects proceed.
David Hutchins: In Arizona, T.P. continues to work through advanced negotiations for new retail load growth including a customer with a 300 megawatt initial phase that would use existing and planned capacity and start to ramp in the 2027 timeframe. We expect updates to follow later this year if a final agreement is reached.
David Hutchins: As a reminder, these large customer opportunities will be in addition to the 2.5 billion U.S. dollars of incremental investment opportunity associated with U.N.S. energy's integrated resource plans.
David Hutchins: Additional opportunities are also underway at our other utilities as we work to build the infrastructure needed to support load growth, improve grid resiliency and facilitate the interconnection of new energy resources.
Jocelyn Perry, Stephanie Amaimo
David Hutchins: With a long track record of increasing dividends for the past 51 consecutive years, coupled with our low-risk growth strategy, we are committed to our annual dividend growth guidance of Fortis 6% through 2029.
David Hutchins: Now I will turn the call over to Jocelyn for an update on our first quarter financial results.
Jocelyn Perry: Thank you, David, and good morning, everyone. For the quarter, we reported net earnings $499 million or $1 per common share, $0.7 higher than the first quarter of 2024.
Flinon, Highlight ZPS drivers for the quarter by segment for the quarter by segment.
Speaker Change: Are US electric and gas utilities provided a two cent increase in EPS?
Speaker Change: Central Hudson, contributed 5 cent of the increase, reflecting rate-based growth and conclusion of the 2024 general rate application, which included rebasing of cost, a higher allowed ROE, and a shift in quarterly revenue effect of July 1st.
Speaker Change: at UNS Energy, EPS Decrease 3 cents. The decrease was driven by the two cent impact of lower margins on wholesale sales due to market conditions, as well as higher cost associated with rate-based growth, not yet reflected in customer rates.
Speaker Change: ITC contributed a 1 cent increase reflecting rate-based growth, partially offset by higher stock-based compensation and higher finance costs.
Speaker Change: For a Western Canadian Utilities, EPS increased 1 cent, largely driven by rate-based growth.
Speaker Change: Timing of operating cost, a lower allowed ROE of 8.97, effective January 1, 2025, and the expiration of a PBR efficiency carryover mechanism at Fortis Alberta, tempered growth, quarter over quarter.
Speaker Change: At our other electric segment, EPS increased one cent due to rate-based growth and higher electricity sales, as well as the timing of quarterly earnings that Newfoundland power related to the approval of cost recovery regulatory mechanisms.
Speaker Change: And while not shown on the slide, financial results for the corporate and other segment were largely consistent with 2024 as higher stock base compensation and finance costs were offset by unrealized gains under innovative contracts.
Speaker Change: A higher average US to Canadian dollar foreign exchange rate of 1.43 compared to 1.35 in the quarter of 2024, contributed a 3 cent EPS increase for the quarter.
Speaker Change: And finally, higher weighted average shares lowered EPS by 1 cent driven by shares issued under a dividend reinvestment plan.
Speaker Change: During the quarter, Moody's confirmed the corporation's BAA3 credit ratings and stable outlook, and just last week DBRS also confirmed our ALO credit rating and stable outlook.
S&P, we continue dialogue around physical and climate risk.
Speaker Change: In March, S&P reaffirmed Fortis Alberta's A minus credit ratings and revised its outlook from negative to stable, given strengthening credit metrics and progress on wildfire mitigation strategies.
Speaker Change: including the implementation of a public safety power shut up or PSPS plan.
Speaker Change: In April , UNS Energy also introduced a PSPS plan for high risk areas within its service territory and we anticipate that Fortis BC will implement a PSPS plan in the coming months.
Speaker Change: In Arizona, we are happy to report progress was made with wildfire legislation which just passed yesterday and now awaits the governor's signature. This bill should limit liability associated with wildfires in Arizona.
Speaker Change: Turning now to recent regulatory activity, as David noted, in March, Fortis BC received a BCUC decision on its 2025 to 2027 multi-year rate framework application.
Speaker Change: This constructive decision builds on the previously approved multi-year rate plan and includes a prescribed approach for operating expenses and capital investment.
Speaker Change: In Arizona, TGP plans to follow the rate case this summer that will include a proposal for use of an annual formulae rate adjustment mechanism consistent with the ACC's formula rate policy statement issued in 2024.
Speaker Change: A formula rate mechanism, if approved by the ACC would adjust rates annually based on a predetermined formula formula rate plans are expected to improve rates stability for our customers while also reducing regulatory lag for the company.
Speaker Change: and in New York, settlement negotiations are progressing well in Central Hudson's General Rate Application.
David Hutchins: Once an agreement is reached, Central Hudson will file a joint proposal outlining the settlement subject to PSC approval and with that I'll now turn the call back to David
David Hutchins: Thank you, Jocelyn. We are pleased that the progress our teams are making so far this year to deliver on our operational and financial objectives.
David Hutchins: For the remainder of 2025, we are focused on executing our capital plan, pursuing incremented regulated growth opportunities and navigating the volatile macro environment so that we can continue to provide reliable and affordable service to our customers and compelling long-term returns to our shareholders.
Stephanie Amaimo: That concludes my remarks. I will now turn the call back over to Stephanie. Thank you, David. This concludes the presentation. At this time, I'd like to open the call to address questions from the investment community.
Stephanie Amaimo: Thank you. We will now begin the question and answer session. To join the question queue, you may press Thar then one on your telephone keypad. You will hear tone acknowledging your request.
Stephanie Amaimo: If you are using a speaker phone, please pick up your handset before pressing any keys.
Speaker Change: And the first question comes from Rob Hope with Scotiabank. Please go ahead.
Rob Hope: Good morning, everyone. I appreciate the commentary on potentially tariffs having a little impact on the 2025 council plan. Can you maybe just outline that a little bit more? Is that because of inventory or is that domestic supply chain? Then that could that look different in 2026?
Rob Hope: So, it's a combination of both those things, Rob. Obviously, the shorter-term capital plans that we are executing, we typically have a lot of that material on the ground and ready to go. I still don't think even if you look further out from a longer term basis that necessarily will have much impact on our capital plan, if anything at all, from an execution standpoint. Because, you know, this is, remember, this is not necessarily a supply chain issue yet. But, you know, this is not necessarily a supply chain issue yet. But, you know, this is not necessarily a supply chain issue yet.
Rob Hope: and I personally don't think it will get to supply chain constraints. This is more of a cost.
Rob Hope: issue, which of course we are laser focused on to make sure that the costs of implementing those capital plans and what we put in rate basis as cost effective and as affordable as it can possibly be for our customers. So it's more from that kind of perspective than it is necessarily the ability to get say the parts and execute the plan.
Speaker Change: All right, good to hear. And then maybe just moving over to Arizona, just regarding the kind of large customers there and the potential that data centers in that geography. Thank you.
Rob Hope: Can you add some additional color of how conversations have progressed as it does feel like some have fallen away but some have progressed across the continent? Are you seeing increasing certainty that these are your achieving meaningful milestones on these conversations?
attend Data Center says.
Rob Hope: Macro issues and topics that are coming up that I think are putting people a little slower pace on some of these negotiations.
Alright, appreciate that. Thank you.
You bet, Rob.
Speaker Change: And your next question comes from Maurice Choy with RBC. Please go ahead.
Maurice Choi: Thanks, and good morning everyone. Just following up on that early comment about the potential higher cost from government policy on foreign trade, is it fair to say that the formula rate plans at ITC and possibly even at TEP in the future will help offset some of these costs for shareholders?
Maurice Choi: and so, anything possibly central Hudson in the US is probably where the area you might see more frequent rape
Yeah, yeah, Maurice. Thanks for that question. I think it's.
Maurice Choi: So, the main thing about the increase in tariff costs is not necessarily the shareholder impact, but more of the customer affordability impact. So, that's what we're very focused on. When you look at the regulatory mechanisms that we have and say at ITC that we have, and hopefully we'll be getting at both UNS gas and Tucson electric power through the formula rates that they're going to be filing for or have filed for. That's that.
Maurice Choi: The normal regulatory mechanisms, and that goes for the same for almost all of our utilities. Those regulatory mechanisms will pass these higher costs through because they're, you know, obviously prudently incurred costs. There are things that are well beyond our control. We'll try to mitigate as much as we can by looking at alternative supply chains and things like that. And, you know, hopefully looking at alternatives, not just the supply chains, but alternative products that we can provide. But all of that goes into the to the other side of the other side of the other side.
Maurice Choi: to the regulatory construct that we have. So we don't see any of that breaking down, but at the end I got to say this at least one more time. We have to focus on the impacts that this will have on the affordability for our customers because remember these bills that could go up because of these tariffs or other macroeconomic impacts that we might see are on top of what our customers are seeing and the rest of their expenses and bills in their daily lives.
That makes sense. You're in a related way.
to finish off. I wanted to see if he...
Speaker Change: Enemy thoughts about the bill related to the inflation reduction act that was introduced by the representative for the check.
Maurice Choi: The bill obviously not only faces out some of the PTC to ITC to Venezuela, but also eliminates the transferability of credit to third party buyers. So, what if any impact you see that may have on your company's? So, what if any impact you see that may have on your company's?
Maurice Choi: Yeah, so I think that we're still seeing very strong bipartisan support as, you know, recognized by, you know, many letters that have been sent to the administration from a broad array of Republicans and Democrats supporting the inflation reduction act for all the right reasons. I mean, these are investments that we're making in the U.S. specifically and in a lot of the red states.
and their tax credits that get...
Maurice Choi: The benefit goes back to our customers. So again, in that affordability lane that I was just talking about. This is another thing that could help or hurt the affordability story for our customers. I think the view right now is
Maurice Choi: is the IRA going to get completely repealed versus will it have maybe some more scalpel type cuts on different parts. That latter I think is to be determined, but in the end I think the spot that we're at. [inaudible] I'm sorry, I'm sorry, I'm sorry, I'm sorry, I'm sorry [inaudible]
Maurice Choi: and when you look across our portfolio and the investment tax credits and or production tax credits that we have or expect to get are mostly in the safe harbor zone are already been being received so I don't see any of that getting pulled back and we happen to be in a pretty good spot across our company to where the development that we're doing renewables, etc. Once we get past a couple of battery projects.
Maurice Choi: Here in Arizona, we end up actually in a bit of a low period. So the anything that's associated with ITCs or PTCs related to tax credits and what their future might be will be determined when we actually design and plan and do RFPs associated with those projects. So we don't seem much of any of an impact here on the front end. [inaudible]
Perfect. Thank you very much.
Ben Pham: Adrian X. Question comes from Ben Pham with BMO. Please go ahead.
Ben Pham: No, hey, good morning. May I ask the first question on the Canadian election?
Ben Pham: You tell me any potential impact on Fortis and I'm thinking of potential on the transmission side to integration and maybe anything in BC in terms of accelerating any of your projects down there.
Ben Pham: It's on the first one on the transmission. It's hard to say, I don't think I've really even thought through that much from a Canadian policy that whether or not it drives additional transmission investment integration between the US and Canada and or across Canada.
Ben Pham: Inter Province type investments. I think that there's an opportunity and an argument for a little bit more of that, but haven't really seen or been in any of those conversations as of yet. I think overall the new administration
Ben Pham: The Prime Minister, Karni, is really coming out with a great positive message about growing the Canadian economy, developing natural resources and energy infrastructure, all the stuff that we like to hear from a new administration being in the energy industry and looking to build that infrastructure. So I think that will have some definite positive trickle-down impacts across Canada and maybe hopefully specifically in British Columbia as well. We've got it.
Ben Pham: a lot of natural resources in BC, and we're trying to help develop them over there.
Okay, thank God I didn't, maybe I'm the...
Ben Pham: A second question on the funding plan. I know you're happy that you didn't revess in program balance sheets and get shapes.
Ben Pham: But when you think about your growth, it looks like CapEx is rising. You have quite a healthy currency right now, valuation. What's the thought around just relatively attractiveness between the status goal versus opportunistic equity offerings?
Ben Pham: Ben, yeah, you're right. We're always looking at this. And as we go through, you know,
Ben Pham: Looking out beyond the next five years we'll be taking a hard look at you know our funding plan I mean the one thing that we're keen to do and I've said this repeatedly a number of times is you know we want to keep our balance sheet where it is and we certainly don't want to go backwards so as we do.
Ben Pham: You know, look to potential future growth opportunities that we'll be looking to keep the balance she's healthy and
Ben Pham: You know, whether we go for a discrete equity offering or ATM or drip programs, you know, all that depends on how we see the growth coming into play, right? So I think what I can say right now is stay tuned.
Ben Pham: But the ultimate goal when we think about funding is just to keep our balance sheet on a healthy spot, keep our credit ratings and look at the most efficient way to actually fund the plan going forward.
Okay, very good. Thank you.
Speaker Change: and I'm going to be talking about the the the the the the the the the the the the the the
Speaker Change: And your next question comes from Mark Jarvi with CIBC. Please go ahead.
Mark Darby: Thanks. Good morning. Just coming back to the chat, comments on the day of your comments about being mindful of the impacts on customers. When you think about the businesses, maybe this is specifically an ITC and UNS.
Mark Darby: There are more likelihood that rate-based growth goes higher at ITC, and then at UNS, if costs go higher, you just change the scope of work to manage the rate-based growth and affordability for customers, just kind of viewing how to play that across the different operating subsidiaries.
Yeah, it plays out based on-
Mark Darby: You know, based on their specific capital plans. There's a lot of investments.
Mark Darby: that we're planning on doing that in Arizona as an example, as we look to exit coal, some of our coal generation, and we're investing in capital plans. That doesn't necessarily have a negative impact from a customer rate perspective, because we're reducing the affects and replacing it with capital and can keep our customers bills pretty much even even.
Mark Darby: and then of course when you look at the additional growth opportunities when we think of things like data centers and large manufacturing and the mining customers that we have in Arizona, a lot of that growth does and should pay for itself and maybe even a little bit more of the rest of the customers' rate base because of the large energy usage and high capacity utilization that they have. So it's some of this growth and I know people generally think growth because we've been in this [inaudible]
You know, a decade-plus of sort of stagnant
Mark Darby: Energy and sales growth that as we add capital it seems to drop to the bottom line of
Jocelyn Perry, Stephanie Amaimo
Speaker Change: So if you had a stand here today, do you have a sense of what transmission cost increased inflation would be, and then does that force my so to reevaluate scope and time in some of the projects?
Speaker Change: Yeah, no. We're in general. I mean, we're a pretty small, ITC is a pretty small percentage of the overall utility bills in the utility jurisdictions that we serve. It varies from utility to utility, but yeah, we don't have a number for that.
Speaker Change: Okay, and then just coming back to Iowa, a roll for comments you made, any perspectives in terms of eating the letter from the DOJ and just where it stands with the governor's bill right now, I'm trying to pass that through in the current session.
Speaker Change: I think we had an upturned out over to Linda to give a little bit more response to it, but yeah, we got that letter in Iowa, and I think the governor had a very good and a strong response supporting the rofer that's in her energy bill. So, Linda, you want to put the pine on that as well?
Linda: and so as we work with our broad utility coalition to put a strong final push, to continue to advocate and hopefully secure passage of the Governor's energy bill, we continue to be very actively engaged.
Speaker Change: and we still remain hopeful that we will see rofer provisions pass in the coming weeks.
[inaudible]
Speaker Change: And if it did not get passed, it doesn't mean that it's the end of the road, potentially cry again next year or whatever legislative session comes up. Is that the perspective from your view?
Speaker Change: Yeah, absolutely. I mean, we would, you know, continue to assess all options available, which may and could include another attempt to pass Roefer language yet again next year, but that's too soon to obviously make that call where we've got all eyes on the ball to
Get the Rural for Provisions passed in this legislative session.
Understood. Okay, thanks for the time this one. Yep
Speaker Change: And your next question comes from Jameson Ward with Jeffries. Please go ahead.
Hi, good morning.
Speaker Change: Aaron, hey, I could just expand a little bit on the Arizona question earlier and then one follow-up on the ATM and its use and so on.
Speaker Change: First, so regarding that 300 megawatts of new high load factor customers that you're still negotiating with in Arizona, and of course the 600 for 2030 and beyond.
Speaker Change: Could you just give us a bit more color on the types of industries driving this demand? They're expected load profiles and kind of what infrastructure investments might be required beyond what's currently contemplated in your capital plans?
Speaker Change: So obviously for the 300, and I mentioned the six just because you might have long lead time for transmission or even different types of generation ahead of 2030 to have it online by then. Is it mostly data centers? Anything you can kind of point us to from margin, et cetera would be fantastic.
Speaker Change: Yeah, so out of that, I know the last quarter we talked about this huge queue that we have of 10,000 megawatts, the vast majority of that is data centers, there is some manufacturing and some
Speaker Change: Mining and some other large customers in there as well. They are large customers and I'll say they're probably heavily loaded towards the data centers. Obviously there's a lot of these different conversations that are happening at the same time and we're probably not quite ready to talk about what type of...
Speaker Change: of load that is yet unless Susan will correct me if it's already been public but I think we'll just kind of keep it at the large high capacity factor customer.
God in the world, it's really helpful. Thank you.
Speaker Change: Yeah, the second was, so your current funding plan has obviously the drip participation level consistent around 38 percent. You've pointed in the past to CAPEX increases as being the likely driving force around additional, needing to tap additional equity.
Speaker Change: Just given the current macro backdrop and make it as broad as possible, but any potential changes to dividend tax treatment, etc. What sort of contingency plans do you have if participation rates were to decline and maybe just generally at what threshold would you consider activating the $500 million ATM program if it's not just for Catholics increases?
Speaker Change: Just to give us a sense of resiliency of the funding program and that's all I have.
Speaker Change: Yeah, James, your point. Our drip program is still quite healthy. We do have, you know, around 38% participation. And so, you know, ultimately, we look at over the five year, over 2.7 billion of equity that was required. The drip actually gives us that.
Speaker Change: and should the participation change? Are more not aware of any dividend tax changes as of today that we believe is going to change that participation, but should participation change? I think that's what the ATM is there to do as well, right? That we can tap it.
Pretty easily if participation were to decrease. If...
Speaker Change: We were to see participation like vastly decline, then you know, we could expand our ATM program or look at other options, but we're not seeing any slowdown in our participation for a drip program.
Speaker Change: Terrific. Thank you. It seems like you guys are continuing to be really well positioned. Appreciate you answering the questions
Thank you.
Speaker Change: Thank you for watching. I'm Stephanie Amaimo. I'll see you next time.
Speaker Change: And your next question comes from Patrick Kenny with National Bank Financial. Please go ahead.
Patrick Kenney: Thank you. Good morning. Just back to BC. It looks like BC Hydro was looking to add some firm baseball generation in the province and
Patrick Kenney: Perhaps has opened the door to looking at, you know, more reliable, I guess more affordable, natural gas fired capacity. I'm just wondering if this might present any new build opportunities for your electric utility franchise in the province.
Patrick Kenney: Either on an integrated basis or perhaps through partnership. And then I guess for the gas utility as well, depending on where these plants might end up being located.
Patrick Kenney: You know, if you might see any upsides to your rate base, as these new plans come online.
Speaker Change: Yeah, that's a great question. I'll, I'm going to go all the way over a few time zones west and get Roger DallAntonia or CEO to answer that one, because this is a, this is a lot of real good conversation and opportunities that we're seeing in BC Roger.
Speaker Change: Thanks, David. Morning, Patrick. Yeah, so on Monday, the government announced a new call for power and in that call for power, they noted the population growth energy requirements and included capacity. I like the previous call to the energy only.
Speaker Change: I would say it doesn't have an immediate impact on our electric.
Opportunities. We launched in our FBIO last year for power.
in the near term for energy in R.
Speaker Change: Service Territory. We are going to be looking at additional infrastructure for our service territory.
Speaker Change: That could include capacity, it could be transmission interconnected to BC Hydro who may be providing capacity still early to tell. I think what we take out of it.
Speaker Change: Is that given the population growth in the province given the load growth? What we've been saying for quite a while is that an integrated approach.
to dealing with capacity is critical while...
Speaker Change: Renewable Energy on an energy basis, maybe relatively cheap capacity isn't, and that's where we've seen challenges.
Specialist, Winter Peaking,
Speaker Change: Systems. So I do think we're going to see some opportunity within our own plans. So those are a bit early to tell. Your other question back, I think you mentioned thermal generation.
gas generation in the province.
Speaker Change: Those plans have not yet been pursued by the provincial government. They're still looking at clean power, but I do think given where the province's general generation might be something that they're going to start looking at, though, nothing has been noted.
Okay, that's a great color thanks for that.
Speaker Change: and then maybe stay in our West on Fortis, Albert, just put the lower RLE coming into effect this year.
Speaker Change: I know you're pursuing an appeal there on some of the parameters of PPR 3.0, but just wondering if there might be any other offsets that are being pursued.
Speaker Change: in the medium term here and might be sustained under the existing contract, the Consistruct, you know, regardless of the decision to come next year.
Speaker Change: Yeah, so are you are you asking about like offsets from a from a like a cost savings perspective? Yeah, we're on the Capitol front just either or just to kind of offset the earnings impact that we've seen here today.
Speaker Change: Yeah, I mean, at this point, we don't. We're not changing our capital plan based on that outcome. It's a formulaic ROE now in Alberta, and as that changes, you know, obviously we will adjust as much as we can. We're always looking at ways of reducing our cost. We have sharing mechanisms there as well. So that's sort of, I would say, more... [inaudible]
Speaker Change: Nothing that triggers us to take any heroic actions. It was about 30 bits or so of a ROE decrease, and that's well manageable within their plan. Obviously, it does impact the earnings a little bit, but overall, it's small.
Okay, that's great. I'll leave it there. Thank you
Okay, thank you.
Ross Fowler: Once again, if you have a question, please press the star then one. Your next question comes from Ross Fowler with Bank of America. Please go ahead.
David, David, David, David, David, David
More and David, more and Jocelyn, how are you?
Good, Ross.
Speaker Change: Yeah, so I might have missed it in your prepared comments, David, on the call so I apologize, but the 300 megawatts of large load, you said that starts and then in 27 and then ramps.
Speaker Change: It's 300 megawatts where we start or 300 megawatts where we go. So is it starting at 300 and ramping or is it ramping to 300 as it starts up in 2027?
Speaker Change: So it's, it's, see if I get this exact right, it's starting to ramp in 27.
Speaker Change: to a 300-megawatt size. So the phase, the first phase is 300-megawatts.
Speaker Change: They have additional phases that they would look at down the road, which is the additional transmission and generation investments that we need to do that. That's sort of two different paths going on here. One is getting the first phase up and operating in the second phase, then also in parallel negotiating what phase two, three and whatever would look like in the time.
Speaker Change: Investments that we would have to do on the level of commitments and and and contractual relationship that we would have to have with this with this customer.
Okay, perfect. And then Jocelyn, maybe one for you.
Speaker Change: You put your credit metrics slide out in the last quarterly deck and it's not in the current quarterly deck so you can you remind us where you are on current credit metrics where the thresholds are?
Speaker Change: Yes, so nothing has really changed Ross. I mean, as we look forward, we still have the same forecast. So it's just early in the year and there's no reason why we exclude it from the deck other than we only three months into the year and we have no new information.
Speaker Change: But yeah, so we're still on track with the average.
Speaker Change: FFO to data just over 12% for the five years. Nothing's changing there. Perfect, thanks Jarvi. And then I guess the other thing I noticed in the
Speaker Change: Xtrey, obviously spend, I guess a lot of volatility is probably an understatement in FX-Layne Lee.
Yeah, I would.
Speaker Change: We've struggled on this one because there's been so much volatility that we thought we were going to update and then we chose just to do it at, you know, at the same time that we look forward with our new five year capital plan, which is usually in the fall. And just because there's so much volatility, we've felt that if we change it now, we probably would end up changing it again in the fall. So what we've done is provided the sensitivity to give you a sense for... [inaudible]
Speaker Change: How our capital program would change? So look forward to the updating fall. Makes complete sense. Let's not change it 10 times between now here and there as we go forward. And hopefully the volatility comes down. Thank you. Thank you very much. Thank you.
Richard Sunderland: And your next question comes from Richard Sunderland with JP Morgan. Please go ahead.
Richard Sunderland: Hey, good morning, and thanks for the time today. Just have one quick follow-up on that Iowa road for legislation.
Richard Sunderland: I'm just kind of procedurally what's to watch for here is it you know the state needs to pass a budget first and the governor's energy bill may get considered and how to think about that dynamic versus the session kind of being an overtime right now like the session need to keep getting extended after the budget is passed thank you.
Thank you. Thanks for the question, Richard Linda.
Yes, absolutely. Thank you, Richard.
Speaker Change: You know, obviously we don't really have any visibility or insight as to, you know, how the session will specifically proceed in terms of whether the energy bill, you know, may, you know, be in front of the budget bill or budget bill and then other, you know, other legislative priorities. So unfortunately, I wouldn't say that there is a specific. Thank you.
Jocelyn Perry, Stephanie Amaimo
Speaker Change: We're actively engaged in the legislative arena to push for obviously passage of the bill but how it unfolds unfortunately I really can't provide any further insight on.
Speaker Change: No, no, that's helpful. Maybe I'll just ask one more here then. I think earlier there were comments about several weeks as the opportunity here. So is that the expectation that the session will continue for a few more weeks?
Speaker Change: Again, it's difficult to say or know. I think it is somewhat contingent upon whether they have an agreement on a budget.
and the various committees in both the House and Senate. Let's...
Speaker Change: Obviously full floor votes, and so what that specifically means in terms of timeline, you know, again I don't really have visibility or clarity.
based on prior legislative sessions.
Speaker Change: You know, there have been budget bills that have taken, you know, kind of weeks, if you will, to work their way through the process based on amendments and compromises and there have been other budgets.
Speaker Change: that have passed fairly quickly, which could be in a matter of a week or days. So again, it's difficult for us to say or know where exactly the mindset is on the budget.
Jocelyn Perry, Stephanie Amaimo
Got it, very helpful context. Thank you
You're welcome. I shouldn't do it.
Speaker Change: This concludes the question and answer session. I would like to turn the call back over to Miss Amaimo for any closing remarks.
Stephanie Amaimo: Thank you, Michael. We have nothing further at this time. Thank you everyone for participating in our first quarter conference call. Please contact IR. Should you need anything further and have a great day. Thank you very much.
Stephanie Amaimo: This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.