Q3 2025 New Jersey Resources Corp Earnings Call

It will be a question and answer session.

I would like to ask the question. This alliance simply press Star followed by the number one on your telephone keypad and if you would like to withdraw your question Press Star one again.

Now I would like to turn the call over to Adam Prior director of Investor Relations. Please go ahead Adam.

Thank you welcome to New Jersey resources fiscal 2025 third quarter conference call and webcast I'm joined here today by Steve <unk>, our President and CEO, Pat Migliaccio, Our senior Vice President and Chief operating Officer of New Jersey Natural gas Roberto Bell, our senior Vice President and Chief Financial Officer, as well as other members of our <unk>.

And your management team.

Certain statements in today's call contain estimates and other forward looking statements within the meaning of the securities laws.

We wish to caution listeners of this call that the current expectations assumptions and beliefs, forming the basis of our forward. Looking statements include many factors that are beyond our ability to control or estimate precisely.

This could cause results to materially differ from our expectations as found on slide two.

These items can also be found in the forward looking statements section of yesterday's earnings release furnished on form 8-K and in our most recent forms 10-K and 10-Q as filed with the SEC.

We do not by including this statement assume any obligation to review or revise any particular forward looking statements referenced herein in light of future events.

We'll also be referring to certain non-GAAP financial measures such as net financial earnings or NSE, We believe that NFC net financial loss utility gross margin financial margin adjusted funds from operations and adjusted debt provide a more complete understanding of our financial performance. However, these non-GAAP measures are not intended to be a sub.

To do for GAAP or non-GAAP financial measures are discussed more fully in item seven of our 10-K. The slides accompanying today's presentation are available on our website and were furnished on our form 8-K filed yesterday.

Steve will begin with this quarter's highlights beginning on slide four followed by Pat who will discuss New Jersey natural gas highlights Roberta who will review our financial results and then we will open the call for your questions.

With that said I will turn the call over to our President and CEO, Steve West Open. Please go ahead Steve.

Thanks, Adam and good morning, everyone.

2025 continues to be an excellent year for <unk> marked by disciplined execution and consistent performance across all segments. This quarter was no exception.

<unk> raised the lower end of its full year guidance increased capex projections, driven by utility investments advanced projects through the <unk> pipeline and made regulatory progress while identifying multiple expansion opportunities at S&P.

We reported robust investment at New Jersey natural gas under our safe Green program.

Investments that are delivering near real time returns, while helping customers manage their energy use.

CV placed 63 megawatts into service so far this year and will likely finish the year with close to a record amount of capacity placed into service. While also maintaining our project pipeline of investment options, so that remains diverse and flexible.

In storage and transportation, we have reached a settlement in principle of the Adelphia gateway rate case, and expect resolution by the end of the year.

At leaf River, we continue to evaluate expansion opportunities that support future growth.

Energy services provide stability through fee based performance from our asset management agreements.

And finally as they are home services with named a top route pro partner for the ninth consecutive year. This recognition is a testament to our entire team's dedication to service excellence and meeting our customers' home comfort needs with the installation of high quality and reliable equipment.

Turning to slide five for more details on our guidance for the year, we are raising the lower end of our fiscal 2025, and if EPS guidance range by five to.

To $3 20 to $3 30 per share.

This reflects strong operating performance across our businesses and greater visibility into full year results.

The revised range, which is above our long term, 7% to 9% growth target demonstrates our ability to execute through dynamic environments.

On slide six we present, our updated and if EPS guidance by segment.

Natural gas remains the strongest contributor to Nf EPS benefiting from our recent rate case settlement and customer growth.

C. D is expected to contribute over 20% of our end of EPS. This year based on high performing operating assets and the monetization of the residential solar portfolio.

We are slightly narrowing the range of contributions across our business lines consistent with our practice as the year progresses.

These updates reflect outperformance at energy services and a modest change in the relative contributions from New Jersey natural gas and C E D.

Roughly 65% of our full year and if EPS is expected to come from utility operations rising to over 70% when excluding the <unk> gain related to the sale of our residential solar business.

This shows how our platform is anchored in stable reoccurring earnings.

With that I'll turn the call over to Pat to discuss New Jersey natural gas on slide seven.

Thanks, Steve that New Jersey, natural gas customer growth continues to be consistent and reliable contributor to our performance. We now serve approximately 588000 customers with over 90% of these customers being residential and the vast majority being located in our core counties.

Ocean and Morris.

These counties are experiencing solid population growth steady housing starts the new commercial development.

Service territories remain among the most.

Economically vibrant in new Jersey, with stable trends and high demand for affordable reliable energy.

As these customers are integrated into our system to drive recurring margin that compounds over time, but supports continued capital investment.

I want to take a moment to highlight the importance of Citi agreement as part of our future investment.

So you could remains one of the most impactful and unique utility energy efficiency programs in the country.

It serves as a model for how regular utilities can simultaneously deliver benefits to customers and shareholders.

This quarter, we are raising our 2025 capital projections for safe green by over 30%, bringing.

Bringing the expected range up to $90 million to $95 million.

This represents another year of record investment.

This increase was driven by growing adoption of more efficient HVAC systems installation of the weatherization for both residential and commercial customers.

From a financial standpoint.

Green investment benefits for the accelerated cost recovery mechanism. This allows us to begin recovering our investment real time, eliminating regulatory lag and improving capital efficiency strategically secret wise like de carbonization goals. It reduces customer bills lowers emissions and positions <unk> as a forward looking utility committed to sustainability.

Portable, reliable energy.

As these customers are integrated into our system, they drive recurring margin that compounds over time and supports continued capital investment.

Examples how policy alignment customer service and Investor returns can coexist with a single program. We expect save reinsurer made a core element of engine induced capital strategy in the years ahead.

I want to take a moment to highlight the importance of saving as part of our future Investments.

So you can remains 1 of the most impactful and unique utility energy, efficient programs in the country.

As of third quarter, <unk> has invested approximately $383 million in capital projects, which we highlight on slide nine.

Serves as a model for how regular utilities can simultaneously deliver benefits to customers and shareholders.

This quarter. We are raising our 2025 Capital projections for Save Green by over 30%.

More than 47% of these investments are earning near real time returns.

Bringing the expected range up to 9 to 95 million.

Elizabeth such as safely.

These programs provide timely recovery of reduced journey like traditionally associated with utility Capex.

This represents another year of record investment.

Our capital allocation at J&J is designed to support our three strategic pillars.

This increase is driven by growing adoption to more efficient. HVAC systems installation and weatherization for both residential and Commercial customers.

Safe and reliable service customer focused growth.

Clean energy leadership.

We maintain a clear visibility to our capital plan supported by multiyear pipeline of planned work strong regulatory relationships and predictable customer demand.

Looking ahead, we expect <unk> to continue driving value through targeted capital deployment.

With a liability safety decarbonization goals and providing an appropriate return to our shareholders with that I will turn it back to Steve.

From a financial standpoint say green investment benefits from an accelerated cost recovery mechanism. This allows us to begin recovering our investment in real time, eliminating regulatory lag, and improving Capital efficiency, strategically saving the lives of our decarbonization goals. It reduces customer bills, lowers emissions, and positions, and JG is a forward-looking utility committed to sustainability.

It's an example of how policy alignment, customer service, and investor returns can coexist within a single program.

Thanks, Pat I'll move to a discussion of our other operating businesses beginning on slide 10, with clean energy ventures CBD continues to demonstrate the value of the diversified and flexible development model year to date, we've placed approximately 63 megawatts into service, including adding over 30 megawatts since our last conference call.

We expect say agreeing to remain a core element of engine to use Capital strategy in the years ahead.

As of the third quarter, NGG has invested approximately $383 million in capital projects, which we highlight on slide 9.

More than 47 or 70. These Investments are earning near real-time returns for mechanisms such as saving.

We've been closely monitoring the implications of the big beautiful Bill on the renewable sector. Our development pipeline is advancing projects through construction and we are identifying attractive opportunities that align with our investment criteria are.

These programs provide timely recovery and reduced earnings lag traditionally associated with utility cap backs.

Our Capital, allocation of engie is designed to support our 3, strategic pillars, safe and reliable service. Customer focused growth and clean energy leadership.

Our current pipeline includes approximately 131 megawatts of solar projects scheduled to be brought into service in the next two years, representing approximately $350 million of investment with over 800 megawatts of additional investment opportunities in the future.

We maintain clear visibility into our Capital plan, supported by multi-year pipeline of planned work. Strong regulatory relationships and predictable customer demand.

Project pipeline includes a range of opportunities varying in size location and timeline and our agreements with developer partners are scheduled to preserve returns. These contracts good and they are the right, but not the obligation to move forward with individual projects at our discretion.

Looking ahead. We expect NG to continue driving value through targeted, Capital deployment, that aligns with the liability safety, decarbonization goals for providing an appropriate return to our shareholders.

With that, I'll turn it back to Steve.

This approach gives <unk> the flexibility to advance only those projects that are aligned with our long term capital plan and offer the most attractive risk adjusted returns.

It also allows us to scale investment based on market dynamics interconnection timing and return profiles, ensuring disciplined capital deployment and a focus on value creation.

Thanks Pat. I'll move to a discussion of our other operating businesses. Beginning on slide, 10 with clean energy. Ventures CV continues to demonstrate the value of a diversified and flexible development model year to date. We've placed approximately 63 megawatts into service, including adding over 30 megawatts since our last conference call,

<unk> plays a strategic role in <unk> portfolio through disciplined return focused investments aligning with a broader capital plan that remains anchored in our core utility and infrastructure businesses.

We've been closely monitoring the implications of the big beautiful bill on the renewable sector. Our development pipeline is advancing projects through construction and we are identifying attractive opportunities that will align with our investment criteria.

The sale of our residential solar portfolio earlier, this year, not only unlocks value, but demonstrated the strength of our execution and the underlying quality of our assets.

Solar remains one of the fastest and most efficient ways to answer the need for new generating capacity with a robust pipeline flexible capital approach and strong operational capabilities. We believe CEB is well positioned to address this need while contributing to <unk> long term growth.

Our current pipeline includes approximately 131 megawatts of solar projects, scheduled to be brought into service in the next 2 years representing approximately 350 million dollars of investment with over 800 megawatts of additional investment opportunities in the future. Our project pipeline includes a range of opportunities varying in size location and timelines. And our agreements with developer partners are scheduled to preserve returns these contracts, give njr the right, but not the obligation to move forward with individual projects at our discretion.

Now, let's turn to our storage and transportation segment.

This approach gives CED the flexibility to advance only those projects that are aligned with our long-term capital plan and offer the most attractive risk adjusted returns.

Our portfolio of midstream assets, Adelphia gateway and leaf river positions us to serve growing energy demand and constrained markets with highly reliable infrastructure.

At Adelphia, we reached a settlement in principle with the FERC staff and the customers participating in our section four rate case.

It also allows us to scale investment based on market dynamics and our connection, timing and return profiles, ensuring discipline, Capital deployment, and a focus on value creation.

We expect to file an offer of settlement with FERC in the coming weeks and remain optimistic about reaching a resolution this year.

CV, plays a strategic role in njr portfolio through disciplined return focused Investments, aligning with the broader Capital plan that remains anchored in our core utility and infrastructure businesses.

That will be forever, we're advancing our capacity enhancement efforts and evaluating multiple expansion opportunities for both existing and new caverns aimed at delivering attractive long term returns as.

As noted on our last call. We recently completed a non binding open season for a potential fourth cavern, which drew encouraging interest.

As we assess the economics and refine the design criteria at the site are due diligence has identified several organic growth opportunities. We expect to advance a subset of these projects and begin the regulatory process at FERC in the coming months.

Steve Westhoven: To NJR's long-term growth. Now let's turn to our storage and transportation segment. Our portfolio of midstream assets, Adelphia Gateway and Leaf River, positions us to serve growing energy demand in constrained markets with highly reliable infrastructure. At Adelphia, we reached a settlement in principle with the FERC staff and the customers participating in our Section 4 rate case. We expect to file an offer of settlement with FERC in the coming weeks and remain optimistic about reaching a resolution this year. At Leaf River, we're advancing our capacity enhancement efforts and evaluating multiple expansion opportunities for both existing and new caverns aimed at delivering attractive long-term returns. As noted on our last call, we recently completed a non-binding open season for a potential fourth cavern, which drew encouraging interest.

To njrs long-term growth.

Now, let’s turn to our storage and transportation segment.

Conditions for storage remain favorable and the site structural and geographic advantages reinforce its long term value.

Our portfolio of Midstream assets. Adelphia Gateway and Leaf River positions us to serve growing energy demand and constrained markets with highly reliable infrastructure.

As part of <unk> broader strategy, our SMT business complements both our utility and clean energy platforms contributing stable fee based cash flows and offering accretive reinvestment potential.

at Adelphia, we reached a settlement in principle with the ferc staff and the customers participating in our section 4 rate case,

we expect the file and offer of settlement with fur in the coming weeks and remain optimistic about reaching a resolution this year.

With that I'll turn the call over to Roberto for review of our financial results Roberto.

Thank you, Steve and good morning, everyone.

13 shows the main drivers of that were in a fee for the third quarter and year to date periods of fiscal 2025.

At least River where advancing our capacity enhancement efforts and evaluating multiple expansion opportunities for both existing and new Caverns aimed at delivering attractive long-term returns.

The third quarter, we reported EPS of six cents per share compared with a net financial loss of nine cents per share last year.

Steve Westhoven: As we assess the economics and refine the design criteria at the site, our due diligence has identified several organic growth opportunities. We expect to advance a subset of these projects and begin the regulatory process at FERC in the coming months. Market conditions for storage remain favorable, and the site's structural and geographic advantages reinforce its long-term value. As part of NJR's broader strategy, our S&T business complements both our utility and clean energy platforms, contributing stable fee-based cash flows and offering a creative reinvestment potential. With that, I'll turn the call over to Roberto for a review of our financial results. Roberto?

As noted on our last call, we recently completed a non-binding open season for potential. Fourth Cavern, which Drew encouraging interest.

Year to date, and if E $313 $4 million or <unk> 13 per share.

As we assess the economics and refine the design criteria at the site. Our due diligence as identified, several organic growth opportunities,

The increase of nearly 55% year over year.

Drivers include higher utility margins at New Jersey natural gas both rate case.

Net benefit of approximately 30 cents per share for the sale of our residential solar portfolio during our fiscal first quarter.

we expect to advance the subset of these projects and begin. The regulatory process at ferc in the coming months market conditions for storage, remain favorable, and the site's structural and Geographic advantages reinforce its long-term value.

<unk> performance, you know, where surgeons with protection business and strong results from energy services during the winter period.

These results show, the resiliency and the balance of our business model.

As part of njr broader strategy, our S&T business, complements both our utility and clean energy platforms, contributing stable, fee-based, cash flows and offering a creative reinvestment potential.

Roberto Bel: Thank you, Steve. And good morning, everyone. So let's start. The team shows the main drivers of our NFE for the third quarter and year-to-date period of fiscal 2025. In the third quarter, we reported an NFE P/S of $0.06 per share, compared with a net financial loss of $0.09 per share last year. Year-to-date, NFE is $313.4 million, or $3.13 per share, an increase of nearly 55% year-over-year. Drivers include higher utility margins at New Jersey Natural Gas post-rate case, a net benefit of approximately $0.30 per share for the sale of our residential solar portfolio during our fiscal first quarter, improved performance in our storage and transportation business, and strong results from energy services during the winter period. These results show the resiliency and balance of our business model. Now let's move to slide 14, where we will discuss NJR's capital plan.

Now, let's move to slide 14, where we will discuss in your capital plan.

With that, I'll turn the call over to Roberto for review of our financial results. Roberto

For fiscal 2025 from fiscal 'twenty through mistakes are planning capital expenditures ranging from one three to $1 6 billion.

Thank you, Steve. Good morning everyone, select 13 shows a main driver of software or NFP for that third quarter and year to date period of fiscal 2025.

Which aligns with our long term EPS growth target of 7% to 9%.

In the third quarter, we report that nfps of 6 cents per share compared with an net Financial loss of 9 cents per share last year

We agree the lower end of our capital plan from our prior disclosures driven by better than expected tapering deployment I know you feel it would be.

We now expect spending between 650 and $770 million in capital investments during fiscal 2025.

Year to date NFC 31313.4 million or $3.13 per share, an increase of nearly 55% year-over-year.

We plan to update our fiscal 2026 capital planning in November.

System with our typical timeline.

Police have baby boom several area of potential incremental upside equaling safely.

These investments align with our long term is throughout the heap and constant you built infrastructure.

In New Year's Eve natural gas post rate case and net benefit of approximately 30 cents per share for the sale of our residential solar portfolio, during our fiscal first quarter improved performance in our research and transportation business and strong results from Energy Services during the winter period.

<unk> clean energy investments and optimize or tourism transportation capabilities.

These results showed a resiliency and violent of our business model.

Roberto Bel: For fiscal 2025 and fiscal 2026, our planning capital expenditures ranging from $1.3 to $1.6 billion, which aligns with our long-term NFE P/S growth target of 7% to 9%. We increased the lower end of our capital plan from our prior disclosures, driven by better-than-expected safe-grid deployment at the utility. We now expect spending between $650 and $770 million in capital investments during fiscal 2025. We plan to update our fiscal 2026 capital plan in November, consistent with our typical timeline. This update may include several areas of potential incremental upside, including safe-grid. These investments align with our long-term strategy to enhance utility infrastructure, expand clean energy investments, and optimize our storage and transportation capabilities. As highlighted on slide 15, our strong balance sheet and disciplined financial management remain foundational to NJR's long-term strategy and our ability to invest through various economic or market conditions.

I highlight this on slide 15, our strong balance sheet and disciplined financial management.

Now, let's move to like 14 or we will discuss in your Capital plan.

<unk> foundational during your lumpiness throughout the year, and our ability to invest through various economic or market conditions.

We're predicting an adjusted difficult adjusted debt ratio of 19% to 21%, reflecting our conservative approach to why don't you have management and ensuring ongoing access to low cost capital.

For fiscal 2025 and fiscal 2026 or planning Capital expenditures. Ranging from 1.3 to 1.6 billion dollars which aligns with our long-term and faps growth Target of 7 to 9%.

We increase the lower end of our Capital plan from our prior disclosures driven by better than expected saving deployment at the utility.

For fiscal 2025, we project cash flow from operations.

460 $500 million.

We now expect spending between 600 and 650 and 770 million in capital Investments, during fiscal 2025.

This robust cash generation is supported by stable the ability earnings and contribute shows from CV SMT and energy services.

We plan to update our fiscal 2026 Capital plan in November consistent with our typical timeline.

In terms of liquidity, we have $825 million of credit capacity that growth of our credit facilities.

This update may include several areas of potential incremental upside including safe green.

This flexibility positions us to fund our capital plan and manage working capital needs.

Our debt maturity profile is well lathered with no one tied to refinancing risk in the near term limiting interest rate exposure.

These Investments align with our long-term strategy, to enhance utility infrastructure. Expand clean energy Investments, and optimize our resources and transportation capabilities.

Our cash flow strength liquidity position I'm prudent financial policy support in Europe, I believe you to fund growth.

Like that on slide 15 or strong balance sheet and discipline financial management. Remain foundational. To end your long-term strategy and our ability to invest

Roberto Bel: We're projecting an adjusted FFO to adjusted debt ratio of 19% to 21%, reflecting our conservative approach to balance sheet management and ensuring ongoing access to low-cost capital. For fiscal 2025, we project cash flow from operations between $460 and $500 million. This robust cash generation is supported by stable utility earnings and contributions from CB, S&T, and energy services. In terms of liquidity, we have $825 million of credit capacity across our credit facilities. This flexibility positions us to fund our capital plan and manage working capital needs. Our debt maturity profile is well-loaded, with no outsized refinancing risks in the near term, limiting interest rate exposure. Our cash flow strength, liquidity position, and prudent financial policy support NJR's ability to fund growth, maintain flexibility, and preserve shareholder value across a variety of market conditions.

Through various economic or market conditions.

Maintaining flexibility and preserve shareholder value across a variety of market conditions.

With that I'll turn the call back to Steve for concluding remarks on slide 16.

We're projecting an adjusted. SFO to adjust the debt ratio of 19 to 21%, reflecting our conservative approach to balance sheet management, and ensuring ongoing access to low-cost capital.

Thanks Roberto.

For fiscal 2025, we project cash flow from operations.

Fiscal 2025 has been an excellent year for N J R. In the third quarter, we delivered solid operational and financial results raised the lower end of our full year earnings guidance and advanced key strategic investments across all of our core business lines.

Between 460 and 500 million.

These robust cash generation is supported by stable utility earnings and contributions from CV, S&T and Energy Services.

These businesses work together to form a well balanced enterprise that generates predictable earnings and a peer leading long term growth rate supports consistent capital deployment with the ability for incremental upside and creates meaningful value for customers and shareholders alike.

In terms of liquidity, we have 825 million of credit capacity across our facilities.

This flexibility positions us to fund our Capital plan and manage working capital needs.

Just as important our success. This year has been supported by a healthy balance sheet ample liquidity and disciplined capital allocation.

Our, the maturity profile is well larger with no outside. Refinancing risks in the near term limiting interest rate exposure.

That financial strength allows us to maintain flexibility in how we fund growth manage risk and respond to changing market conditions.

Our cash flow strength, liquidity position and prudent Financial policy support in your ability to fund growth.

Roberto Bel: With that, I'll turn the call back to Steve for concluding remarks on slide 16.

And at the core of all this is a team of dedicated employees, who show up every day to serve our customers and communities.

Steve Westhoven: Thanks, Roberto. Fiscal 2025 has been an excellent year for NJR. In the third quarter, we delivered solid operational and financial results, raised the lower end of our full-year earnings guidance, and advanced key strategic investments across all of our core business lines. These businesses work together to form a well-balanced enterprise that generates predictable earnings and a peer-leading long-term growth rate, supports consistent capital deployment with the ability for incremental upside, and creates meaningful value for customers and shareholders alike. Just as important, our success this year has been supported by a healthy balance sheet, ample liquidity, and disciplined capital allocation. That financial strength allows us to maintain flexibility in how we fund growth, manage risk, and respond to changing market conditions. And at the core of all this is a team of dedicated employees who show up every day to serve our customers and communities.

With that, I'll turn the call back to Steve for concluding remarks on slide 16.

Thanks Roberto.

I want to give a special thank you to our employees out in the field working through 95 degree heat. This summer to ensure our customers are safe and comfortable your hard work does not go unnoticed.

To conclude we believe <unk> is well positioned to deliver attractive long term risk adjusted returns.

Fiscal, 20125 has been an excellent year for njr and the third quarter, we delivered solid operational and financial results. Raise the lower end of our full year. Earnings guidance and advanced key strategic Investments across all of our Core Business lines.

Our track record flex not only the ability to navigate changing environments, but also to allocate capital to where it matters most serving the evolving needs of our customers.

So with that we'll now open the line for questions.

These businesses work together to form a well-balanced Enterprise, that generates predictable earnings and a peer-leading. Long-term growth rate supports consistent Capital deployment with the ability for incremental upside and creates meaningful value for customers and shareholders alike.

We will now begin the question and answer session. If you would like to ask a question simply press star followed by the number one on your telephone keypad.

Just as important our success, this year has been supported by a healthy balance sheet, ample liquidity, and disciplined, Capital allocation.

And your first question comes from the lineup featuring Sunderland with Jpmorgan Richard Please go ahead.

That Financial strength allows us to maintain flexibility and how we fund growth manage risk and respond to changing market conditions.

Hi, good morning, Thanks for the time today.

Hey, rich.

Steve Westhoven: I want to give a special thank you to our employees out in the field, working through 95-degree heat this summer to ensure our customers are safe and comfortable. Your hard work does not go unnoticed. To conclude, we believe NJR is well-positioned to deliver attractive long-term risk-adjusted returns. Our track record reflects not only the ability to navigate changing environments, but also to allocate capital to where it matters most, serving the evolving needs of our customers. So with that, we'll now open the line for questions.

A further yourself to your rate case.

And at the core of all, this is a team of dedicated employees to show up every day to serve our customers and communities.

Year over year impact of the settlement in 2026 and are there any other key considerations here.

Rich so right now we're still in the I guess, the middle of the settlement and none of those details have been made public at this time. So the negotiation is being constructed and we're nearing an end, but we're not going to divulge any more information around that at this point I'm wondering yourself, obviously locals.

I want to give a special thank you to our employees out in the field. Working through 95 degree Heat. This summer to ensure our customers are safe and comfortable. Your hard work is not going unnoticed.

To conclude, we believe NJR is well-positioned to deliver attractive long-term risk-adjusted returns.

Our track record Flex, not only the ability to navigate changing environments, but also to allocate Capital to where it matters, most serving the evolving needs of our customers.

Okay.

Understood Fair enough and then turning to <unk>.

So with that, we'll now open the line for questions.

Operator: We will now begin the question and answer session. If you would like to ask a question, simply press star followed by the number one on your telephone keypad. And your first question comes from the line of Richard Sunderland with JPMorgan. Richard, please go ahead.

131 megawatt target over the next two years, how have you sized that relative to initial expectations last fall when you rolled out your 25 and 26 capital plan and then I guess similarly has <unk> changed your expectations at all around CEB.

We will now begin the question and answer session. If you would like to ask a question simply press star, followed by the number 1 on your telephone keypad.

Richard Sunderland: Hi, good morning. Thanks for the time today.

And your first question comes from the lineup, featured underland with JP Morgan. Richard, please go ahead.

Steve Westhoven: Thank you, Richard.

So I'll take that in a few different parts.

Hi, good morning, thanks for the time today.

Richard Sunderland: For the Adelphia rate case, what will be the year-over-year impact of the settlement in 2026, and are there any other key considerations here?

One.

We're finding that improve the way that we report.

Yes.

We're going to invest in CEB, so the 131 megawatts.

Steve Westhoven: Right now, we're still in the, I guess, the middle of the settlement, and none of those details have been made public at this time. So, you know, negotiation has been constructed and we're nearing an end, but we're not going to divulge any more information around that at this point. We'll reach settlement, obviously, but we'll share what we can.

For the Adelphia rate case, what would be the year-over-year impact of the settlement in 2026? And are there any other key considerations here?

Really what's under construction are really nearing construction at this point in time. So we've got some good visibility on the investments that we'll make.

Over the next two years and you'll see those come into service.

Addressing ob.

Richard Sunderland: Understood. Fair enough. And then turning to CEV, the 131 megawatt target over the next two years, how have you sized that relative to initial expectations last fall when you rolled out your '25 and '26 capital plan? And then, I guess, similarly, has OBBB changed your expectations at all around CEV?

Okay.

Reach. So right now, we're still in the, I guess, middle of the settlement, and none of those details have been made public at this time. So, you know, negotiations make constructive, and we're nearing an end. Um, but we're not going to divulge any more information around that at this point. We'll reach them, and obviously, we'll share what we can.

And all the other questions around that.

Yes, we just talked about our capital plans.

Audi of that over the next few years, we've got high confidence in the projections that we're sharing with you and that really drives or seven docker stacked growth rate.

<unk>.

So when you look at Ob and you look at its potential impact on our total capex.

Steve Westhoven: So I'll take that in a few different parts. One, you know, we're trying to improve the way that we report the future capital that we're going to invest in CEV. So, you know, the 131 megawatts is really, you know, what's under construction or really nearing construction at this point in time. So we've got some good visibility on the investments that we'll make, you know, there, you know, over the next two years, and you'll see those, you know, come in service. You know, addressing, you know, OBBB and all the other questions that are around that, you know, we just talked about, you know, our capital plans and, you know, the clarity of that over the next few years. We've got high confidence in the projections that we're sharing with you, and that really drives your 7% to 9% growth rate.

Understood fair enough and then turning to cev the 131 megawatt Target over the next 2 years. How have you sized that relative to initial expectations last fall? When you rolled out your 25 and 26, Capital plan and then I guess similarly has obb changed your expectations at all around CV.

So,

You'll notice the majority.

Our infrastructure, our assets that deliver natural gas or natural gas related.

And that's reflected in our earnings mix in fact over 80% of our Capex in the past five years has caused our natural gas business and we expect the majority of our growth still to continue in that space.

So you heard Pat talk today about the energy efficiency program and the growth is there.

We talked a little bit about the potential expansion at least river.

In a few different parts. Um, 1, you know, we're finding improve the way that we report the, you know, people that we're going to invest in CV. So, you know, the 131 megawatts is really, you know, what's under construction or or really nearing construction at this point in time. So we've got some good visibility on the Investments that will make, you know, there, you know, over the next few years and you'll see those, you know, come into service.

Um,

Growth of our core businesses.

And we feel that this is going to drive value to cross all of <unk> assets.

So put it in the context of majority of the dollar separately.

We're getting our gas related businesses.

Steve Westhoven: So when you look at OBBB and you look at its potential impact, you know, on our total CapEx, you know, you'll notice the majority of our infrastructure, our assets that deliver natural gas are natural gas-related. And that's reflected in our earnings mix. You know, in fact, over 80% of our CapEx in the past five years has come from the natural gas business. And we expect the majority of our growth, you know, still to continue in that space. So, you know, you heard Pat talk today about the energy efficiency program and the growth that's there. We talked a little bit about the potential expansion at Leaf River and the organic growth of our core businesses. And we feel that this is going to drive the value across all of NJR's assets.

Regardless of how EDI.

You know, addressing, you know, OB, um, obb, uh, and, and all the other questions that are around that. Um, yeah, we just talked about, you know, our Capital plan and, you know, the clarity of that over the next few years. Um, we've got high confidence in the projections that we're sharing with you and and that really drives your 79% growth rate. Um,

DVD.

It turns out we remain confident that we're going to hit our capital targets over the next few years through our portfolio of businesses and through the examples that I just shared with you.

So yeah, obviously that flexibility and our ability to invest in multiple platforms is going to drive.

Our growth going forward and of course, that's driven by the fact that you've got some really some very real growth Tommy any electric side of the market that need to be ballpark shuttle stop so all of our infrastructure is going to be able to participate in that we still think solus importantly, quickest capacity that you can branch the markets.

So when you look at OBD and you look at its potential impact, you know, on our total capex, you know, you'll notice majority of our infrastructure, our assets that deliver natural gas are natural gas related, um and that's reflected in our earnings. Mix, you know, in fact over 80% of our capex in the past 5 years has come from natural gas business and we expect the majority of our growth, you know, still to continue in that space.

Steve Westhoven: So, you know, to put it into context, you know, the majority of the dollars that we're going to spend, you know, are going to be in our gas-related businesses. So regardless of how BBB, you know, turns out, you know, we remain confident that we're going to hit our capital targets over the next few years, you know, through our portfolio of businesses and through the examples that I just had shared with you. So, you know, obviously, that flexibility and our ability to invest in multiple platforms is going to drive, you know, our growth going forward. And, you know, of course, that's driven by the fact that you've got some really, you know, some very real growth coming in the electric side of the market that, you know, we've all talked about all the time.

Overall, just to put it in context.

Um, so, you know, here at NJR, we talked today about the Energy Efficiency program and the growth that's there. We talked a little bit about the potential expansion at Leaf River and the organic growth of our core businesses. We feel that this is going to drive value across all of NJR's assets.

Yeah, we feel good about our business is moving forward and our ability to do it.

Invest and grow.

Great. Thanks for the thoughts there I'll leave it there. Thank you.

And your next question comes from the line of Queens, adding house, but Siebrecht William Shang grants. Please go ahead hey.

Guys how are you.

Thanks, Steve.

Steve.

Expansion of leaf River do you have any sense after the open season.

When a decision timeline might look.

A decision timeline might look like.

Steve Westhoven: So all our infrastructure, you know, is going to be able to participate in that. You know, we still think solar is important. You know, it's the quickest, you know, capacity that you can bring to the market. But, you know, overall, you know, just to put it in context, you know, we feel good about, you know, our businesses moving forward and our ability to invest and grow.

Yes.

Yes, what we said during the during the call to meet expected in the coming months, we are making a filing at FERC.

And right now we have another open season to binding open season, that's taking place at least for herself.

Or are we hitting on exactly what the expansion looks like.

Certainly, yes, <unk> customers and things like that so yes.

Richard Sunderland: Great. Thank you for the thoughts there. I'll leave it there. Thank you.

Yeah, through our portfolio and businesses and through the examples that I just had shared with you. Um, so, you know, obviously that flexibility and our ability to invest in multiple platforms. Um, is going to drive, you know, our growth going forward. And, you know, of course, that's driven by the fact that you've got some really, you know, some very real growth coming in the electric side of the market that, you know, we've all talked about all this time. So all of our infrastructure, you know, is going to be able to participate that, you know, we still think solar is important and, you know, it's a quickest, you know, capacity that you can bring to the market, but, you know, overall, you know, just to put it in context, um, you know, we, uh, we feel good about, you know, our businesses moving forward in our ability to, to, uh, invest and, and grow

This is something that hopefully will take place over the next few months just depending on how these processes start out.

Great, thank you for the thoughts there. I'll leave it there. Thank you.

Operator: And your next question comes from the line of Chris Ellinghouse with Seabrook William Shank. Chris, please go ahead.

Is there any incremental color you can add.

Chris Ellinghaus: Hey, guys. How are you?

Richard Sunderland: Hey, Chris.

Chris Ellinghaus: Steve, the expansion of Leaf River, do you have any sense after the open season, you know, when a decision timeline might look or what a decision timeline might look like?

And your next question comes from the line Chris ellinghaus with seberg, William shank Chris, please go ahead. Hey guys, how are you?

On S N Ts relative strength this quarter.

Um, hey, Chris

Yes, I think it's just the strong natural gas market installed weather certainly has.

S contributed quite a bit.

Steve Westhoven: Yeah, you know, we're, you know, we've said during the, you know, during the call, you know, that we expect that in the coming months to be making, you know, filing at FERC. But right now, we have another open season, a binding open season that's taking place at Leaf River. So, you know, we're narrowing in on exactly what, you know, the expansion looks like and certainly, you know, size scope, customers, and things like that. So, you know, to me, you know, this is something that, you know, hopefully will take place over the next, you know, few months, you know, depending on, you know, how this process has turned out.

If you look at transportation demand storage demand balancing extremely.

Steve the, the expansion of, uh, Leaf River, do you have any sense after the Open Season? You know, when a decision timeline might look what a, what a decision timeline might look like.

Extremely hot base things that we've talked about all the time. This is a real growth in the energy markets and you need infrastructure to be able to supply that.

Natural gas is a flexible fuel that's able to supply those needs when called upon.

Okay.

Going back to the Adelphia case, certainly have really big catalysts for 2026 when.

When you make your filing do you anticipate you'll do a release for that.

Chris Ellinghaus: And is there any incremental color you can add on S&T's relative strength this quarter?

Yeah. You know, if we're, uh, you know, we've said during the, you know, during the call, you know, that we expected in the coming months to be making, you know, filing it first. Um, but right now we have another Open Season, the finding Open Season that's taking place that we've ever. So, you know, we're narrowing in on exactly what, you know, the expansion looks like. And certainly, you know, cycos scope customers and things like that. So yeah, I mean, yeah, this is something that, you know, hopefully will take place over the next, you know, few months, you know, depending on, you know, how these processes are now.

When we say when we can see.

Yes, I guess the settlement in the rate case and everything goes into effect.

Steve Westhoven: You know, I think it's just a strong natural gas market. You know, the stalled weather certainly has contributed, you know, quite a bit. You know, if you look at, you know, transportation demands, storage demands, you know, balancing, you know, extremely hot days, you know, some things that we talk about all the time, this is real growth in the energy markets, and you need infrastructure to be able to supply that. And, you know, natural gas is a flexible, you know, fuel that's able to supply, you know, those needs when it's called upon.

And is there any incremental color? You can add on smt's, uh, relative strength, this quarter.

Definitely.

Public disclosure at that point in time, yes.

Tariffs there'll be a number of things that will be required to do so certainly we'll talk about it.

[noise] referred of utility gross margin for the quarter.

Little bit bigger than I was expecting.

I'm guessing that that just has to do with some variance in my seasonality expectations for the rate case, but can you break out at all that 25 million.

Chris Ellinghaus: Okay. Going back to the Adelphia case, it's certainly a really big catalyst for 2026. When you make your filing, do you anticipate you'll do a release for that?

You know, I think it's just that the strong natural gas market. You know, you saw whether, um, certainly has, uh, has contributed, you know, quite a bit. Um, you know, you look at, you know, Transportation demands and storage demands, you know, balancing, you know, you know, extremely hot days. You know. It's the things that we talk about all the time. This is real growth in the energy markets and you need infrastructure to be able to supply that. And, uh, you know, natural gas is a flexible, you know, fuel that's able to supply, you know, those needs. Um, when it's called upon,

Case versus sort of organic growth.

Yes.

I would say on that prices you had benefit certainly from the new rate case, but also we have been making a lot of progress on the Opex side. So it's a combination of the two.

Okay, um, going back to the Delta case, it's certainly a, a really big Catalyst for 2026 when you make your filing. Do you anticipate? You'll do a release for that.

Steve Westhoven: When we, you're saying when we complete the, you know, I guess the settlement and the rate case and everything goes into effect?

Okay.

Chris Ellinghaus: Yeah.

Steve Westhoven: I mean, there'll definitely be, you know, a public disclosure at that point in time. You know, we'll have to update the tariffs. There'll be a number of things that will be required, you know, to do. But certainly, we'll talk about it.

And lastly, I think you sort of intimated.

Intimated this vis vis the tax bill and what the outlook for CEB might be going forward, but.

When we you say when we complete the uh uh you know, I guess the settlement in the rate case and everything goes into effect. Yeah. I mean, they'll be, they'll definitely be, you know, public, uh, disclosure at that point in time, you know, what the update entire, they'll be in number of things that will be required, you know, to do. Um, but certainly we'll talk about it.

Chris Ellinghaus: Roberto, the the utility gross margin for the quarter was a little bit bigger than I was expecting. I'm guessing that that just has to do with some variance in my seasonality expectation for the rate case. But can you break out at all that $25 million case versus sort of organic growth?

Um,

The pricing in PJM.

It was very strong.

So are you kind of thinking.

Part of your thought processes, you have fungibility of Capex across the board, but are you also thinking that sort of the pricing.

Solar is going to equalize to a certain extent where power prices are headed in.

Roberto Bel: Yeah. So maybe what I would say on that place is you have benefited certainly from the new rate case. But then also, we have been making a lot of progress on the OPEC side. So it's a combination of the two.

Roberto the, the utility gross margin for the quarter was a little bit bigger than I was expecting. Um, I'm guessing that that just has to do with some variance and my seasonality expectations for the rate case. But can you break out at all that 25 million, um, case versus sort of an organic growth.

Solar project Economics will also.

Adjust over time.

Yes, there's certainly going to be a rate rationalizations market on what costs are you writing no prices have been.

Yeah, so maybe maybe what I would say on that price is you you have benefited certainly from that new rate, but then also, we have been making a lot of progress on Google pixel. So it's a combination of the 2.

Chris Ellinghaus: Okay. And lastly, I think you sort of intimated this, Steve, vis-à-vis the tax bill and what the outlook for CEV might be going forward. But the pricing in PJM is pretty, was very strong. So are you kind of thinking, you know, part of your thought process is, you know, you have plungibility of CapEx across the board, but are you also thinking that sort of the pricing for solar is going to equalize to a certain extent where power prices are headed and solar project economics will also adjust over time?

um,

Have been moving up in the electric side of the market and that's driven kind of a valuable infrastructure and that's really it.

and lastly uh I think you sort of um intimated this Steve Visa V, the tax bill and and

It plays into our general trend is that infrastructure is going to become more valuable in N. J R owns a lot of infrastructure that youre able to organically expand and participate in those markets.

What the outlook for CV. Might be going forward but, um,

Yes, it's been a thesis that.

We've been talking about for a while and we continue to make investments and grow the company basically eating into that real market demand, so long winded way of saying yes.

The demands of the market.

The pricing has to support new investment and Thats occurring real time.

Okay, great. Thanks for the details I appreciate it.

Alright, thank you.

Again, if you would like to ask a question simply press star followed by the number one on your telephone keypad.

Steve Westhoven: You know, there's certainly going to be a rerationalization of this market on what, you know, costs are. And you're right. You know, prices have been, you know, have been moving up in the electric side of the market, and that's driven, you know, kind of the value of all infrastructure. And this really, you know, plays into our general premise that, you know, infrastructure is going to become more valuable, and NJR owns a lot of infrastructure that you're able to organically expand and participate in those markets. So, you know, it's been a thesis that, you know, we've been talking about for a while, and we continue to make investments and grow the company, basically feeding into that real market demand.

The pricing in pjm is is pretty was very strong. Um, so are you kind of thinking, you know, part of your thought process is, you know, you have fungibility of capex across the board but are you also thinking that sort of the pricing for solar is going to equalize to a certain extent where power prices are headed and and uh solar project economics will also adjust over time

And your next question comes from the line of Travis Miller with Morningstar Travis. Please go ahead.

Good morning, everyone and thank you.

Thanks Travis.

Just following up on the leaf river conversation and the expansion are there are a series of discrete steps that have to be done for the expansion versus it sounds like Youre also doing an open season for some of the existing capacity what are the steps in terms of the expansion that you're looking at so it would be next to FERC.

Steve Westhoven: So, you know, one way of saying yes, you know, the demands of the market, you know, the pricing has to support new investment, and that's occurring in real time.

And then is it up to you to decide enough I D.

Yes, and you need really well against the customers lined up and what services that they need to run through your feed studies to see what equipment and well construction needs to take place. That's all in motion right now and then there'll be a FERC filing that approval and then they'll set in motion the construction to be able to build the services.

Chris Ellinghaus: Okay. Great. Thanks for the details. Appreciate it.

Yeah, they're certainly going to be a re-ring. You know, prices have been, you know, um have been moving up in the electric side of the market and that's driven, you know, kind of the value of all infrastructure and its really, you know, plays into our general premise that, you know, infrastructure is going to become more valuable in njr owns a lot of infrastructure that you're able to organically expand and participate in those markets. So um, you know, it's been a thesis that that uh, you know, we've been talking about for a while and we can continue to make investments and grow the company, basically feeding into that real market demand. So you know 1 wounded way of saying yes you know you know the the demands of the market um you know the price you have to support new investment and and that's our current real time.

Steve Westhoven: All right. Thank you.

Okay, great. Thanks for the details. Appreciate it.

Operator: Again, if you would like to ask a question, simply press star followed by the number one on your telephone keypad. And your next question comes from the line of Travis Miller with Morningstar. Travis, please go ahead.

All right. Thank you.

<unk> go into commercial operation do.

again, if you would like to ask a question simply to press star followed by the number 1 on your telephone keypad,

Meet the customers' needs.

Okay.

Richard Sunderland: Good morning, everyone. Thank you.

What point in that process would you know.

And your next question comes from the line of Travis Miller. Good morning, Star Travis. Please go ahead.

Steve Westhoven: Thanks, Travis.

Around the Capex.

Richard Sunderland: And just following up on the Leaf River conversation and the expansion, are there a series of discrete steps that have to be done for the expansion versus it sounds like you're also doing an open season for some of the existing capacity? What are the steps in terms of the expansion that you're looking at that would be next? The FERC filing, and then is it up to you to decide an FID?

Good morning everyone and thank you.

Number that you're at.

It'll be willing to share or be putting explicitly into your capex forecast at what point.

Hey, Travis.

In this process for the expansion would you expect to have some kind of number.

Yeah, I think that's totally in the coming months, but we hope to have it done we normally update our capex schedule in November and I would expect that.

We take place.

Competitive lots up the way that we're expecting at this point.

Steve Westhoven: Yeah. I mean, really, you know, we'll get the customers lined up and, you know, what services that they need, you know, run through your feed studies to see what equipment and what construction needs to take place. That's all, you know, in motion right now. And then there'll be a FERC filing, you know, that approval, and then they'll set in motion the construction to be able to build the services and then go into commercial operations and meet the customer's needs.

Okay, Great and then different talked about topics the dividend. So traditionally the board has considered the dividend increase here in the next couple of months.

And just following up on the Leaf. River conversation in the expansion. Are there? A series of discrete steps that have to be done for the expansion versus? It sounds like you're also doing an open season for some of the existing capacity. What are the steps in terms of the expansion that you're looking at? That would be next, the for filing and then is it up to you to decide an fid

Given the EPS that you've had over the last few years. So how do you think the board is going to look at not necessarily the payout ratio, but just generally capital allocated to the dividend given that.

Your payout ratio would be pretty low on on this year's earnings. But then you also talk about the base.

Richard Sunderland: Okay. And at what point in that process would you know in a round CapEx number that you'd either be willing to share or be putting explicitly into your CapEx forecast? At what point in this process for the expansion would you expect to have some kind of number?

Yeah, I mean, really, you know, we'll get the customers lined up and you know what services that they need, you know, run through your feed studies to see what equipment and what construction needs to take place. That's all, you know, in motion right now. And then there'll be a brick filing. You know, that approval. And then they'll set in motion to construction to be able to build the services and then go into commercial operation today. Um, meet the customer's needs.

<unk> number.

How is the board thinking about that base versus actual.

Okay. And at what point in that process would you know, and around the capex?

Yes, China, Sweden, typically view that.

Related to our historical growth rate right. So in years of outperformance that payout ratio will become a little bit less.

Number that, you didn't either be willing to share or be putting explosively into your capex forecast at what point?

Steve Westhoven: Yeah. I think that's, you know, that'll be in the coming months, but, you know, we hope to have it done. You know, we normally update our CapEx schedule, you know, in November, and I would expect, you know, that would take place today, you know, if everything flies up the way that we're expecting at this point.

In this process for the expansion, would you expect to have some kind of number?

I think history is a good guide for the future and in this case we.

We typically stay.

Stay pretty tight to how we're growing the company longer term and that dividend all of that and you can see we've increased the dividend for the past 234 years and we expect to continue to do so so I think.

Richard Sunderland: Okay. Great. And different talk but topic, the dividends. Traditionally, the board's considered the dividend increase here in the next couple of months. Given the EPFs that you've had over the last few years, how do you think the board is going to look at not necessarily the payout ratio, but just generally capital allocated to the dividend given, again, your payout ratio is pretty low on this year's earnings, but then you also talk about the base earnings number. How is the board thinking about that, base versus actual?

yeah, I I think that's, you know, that'll be in the coming months but you know, we hope to have it done, you know, we normally update our capex schedule, you know, November and uh we expect you know, that we take place then, you know, if everything locks up the way that we're expecting at this point,

Okay, great then different talk topic, the dividends the traditionally, the board's, considered the dividend increase here in the next couple months.

Historical.

Performance would indicate how we would act in the future.

Okay great.

Thanks, so much.

given the EPS that you've had over the last few years, how do you think the board is going to look at not necessarily the payout ratio but just generally Capital allocated to the dividend given

Alright, Thanks, Josh.

And your next question comes from the line of Robert Moskow with Mizuho Securities. Robert Please go ahead.

Again, your payer ratio would be pretty low on this year's earnings, but then you also talk about the base.

Earnings number.

Steve Westhoven: Yeah. Travis, we typically view that, you know, related to our historical growth rate, right? So, you know, in years of outperformance, that payout ratio would become, you know, a little bit less. I think history is a good guide, you know, for the future. In this case, you know, we typically stay pretty tight to, you know, how we're growing the company, you know, longer term and the dividend of all that. And you could see, you know, we've increased the dividend, you know, for the past, you know, 23, 24 years. We expect to continue to do so. So I think, you know, historical performance would indicate, you know, how we'd act in the future.

Hey, good morning, everyone. Just wondering if you could.

How's the board thinking about that bass versus actual?

Hey, guys.

I'm just wondering if you guys could speak to the higher Capex and save Green just wondering what's driving the stronger demand for that program and early days here, but could this portend anything around the size of future iterations of this program as far as what gets approved.

Thanks Robert.

To take that question, Hey, Rob Good morning, Yeah. So.

General remarks was short of the new.

<unk> as we refer to it in the energy efficiency program. It's a combination of both strong demand from the market on the residential side for more efficient HSE systems, but also on the commercial side of direct install program, which is a newer feature of the safety program.

Richard Sunderland: Okay. Great. That's all I had. Thanks so much.

Yeah yeah. Try to Sweet typically view that, you know um related to our historical growth rate, right? So you know in years about performance that payout ratio would become, you know, a little bit less. Um I think a history is a good guy, you know, for the future in this case, you know, we, uh, we typically, uh, stay pretty tight to, you know, how we're growing the company, you know, longer term, and it did end up all that and you've seen, you know, we've increased the dividend, you know, for the past, you know, 23, 24 years, we expect to continue to do so. So I think uh, you know, historical um performance um would indicate you know how it would act in the future?

Steve Westhoven: All right. Thanks, Travis.

Okay, great. That's all I have. Thanks so much.

Operator: And your next question comes from the line of Robert Mosca with Mizuho Securities. Robert, please go ahead.

All right, Miss Travis.

And combined with candidly our teams really strong execution of the program led to the guidance for this year.

Robert Mosca: Hey, morning, everyone. Just wondering if you could speak--hey, guys. Just wondering if you guys could speak to the higher CapEx and safe-grid. Just wondering what's driving the stronger demand for that program. And early days here, but could this portend anything around the size of future iterations of this program as far as what gets approved?

And your next question comes from the line of Robert Moscow with Mr. Oil Securities Robert, please go ahead.

And as we've already indicated we typically update capex guidance in 2026, so we'll make any indications about any.

Hey morning, everyone. Uh, just wondering if you could speak

Future seek rate increases at that point in time, but.

But just more broadly as we think about the strategic advantage of the program.

So repeating my remarks, it really is a win win win right, we're able to lower customer bills, which is particularly important in appeared we're focused on affordability.

Steve Westhoven: Thanks, Robert. I'm going to ask to take that question.

Hey guys. I'm just wondering if you could speak to the higher CapEx and Save Green. I'm just curious what's driving the stronger demand for that program. It's early days here, but could this portend anything around the size of future iterations of this program as far as what gets approved?

Pat Migliaccio: Thanks, Rob. Good morning. Yeah. So the January marked the start of the new triennium, as we refer to it, of the Energy Efficiency Program. And it's a combination of both strong demand for the market on the residential side for more efficient HVAC systems, but also on the commercial side, a direct install program, which is a newer feature of the safe-grid program. And combined with, candidly, our team's really strong execution of the program led to the guidance rates this year. And as we've already indicated, we typically update CapEx guidance in 2026. So we won't make any indications about any future safe-grid increases at that point in time. But just more broadly, as we think about the strategic advantage of the program and at the risk of repeating my remarks, it really is a win-win-win, right?

While at the same time, reducing emissions and is a strong decompositions, we will have a toolkit.

And.

As we pointed out a couple of different times. This is one of the.

Thanks Robert. I'm going to pass it to take that question. Hey Rob, good morning. Uh yeah. So the general Mark the start of the new uh Triads as we refer to it and the energy officials program and it's a combination of both.

Real time recovery mechanisms that we have at our disposal.

Okay.

Got it thanks for that Pat.

And for my follow up it seems like the permitting environment for gas infrastructure in the northeast might be easing a little bit is there anything <unk> be interested in the growth.

Strong demand for the market on the residential side for more efficient HVAC systems. Uh, but also on the commercial side, a direct install program, which is a newer feature of the Savory program.

Growth projects or trying to secure system or supply redundancy to support.

Some of the customer growth you guys are experiencing in maybe improve reliability.

I mean those are programs that were.

We have continued to make investments.

Reliability and expanding system, making sure you had customer growth numbers.

Pat Migliaccio: We're able to lower customers' bills, which is particularly important and appear more focused on affordability, while at the same time reducing emissions. It is a strong decarbonization tool that we have a toolkit. And, you know, as we pointed out a couple of different times, this is one of the real-time recovery mechanisms that we have at our disposal.

That'd be great you know over the past few years, so I would expect kind of more.

More of the same item permitting and conversations around it.

At times have been difficult in the past, we've always been able to achieve that investment into building infrastructure that we need.

So I would just expect that to continue.

Yes.

Program led to the guidance for this year. Um, and as we've already indicated, we typically update capex guidance in 2026. So um we'll make any indications about any uh future uh sea green increases at that point in time. Uh but just more broadly as we think about strategic advantage of the program and at the risk of repeating my remarks, it really is a win-win, right? We're able to lower customers bills, which is particularly important and appeared more focused on affordability. Um, while at the same time, reducing emissions, it is a strong decarbonization tool that we have the toolkit uh and uh you know is as we pointed out a couple different times. This is 1 of the real-time recovery mechanisms that we have at our disposal.

Robert Mosca: Got it. Thanks for that, Pat. And for my follow-up, it seems like the permitting environment for gas infrastructure in the Northeast might be easing a little bit. Is there anything NJR would be interested in, be it growth projects or trying to secure system or supply redundancy to support some of the customer growth you guys are experiencing and maybe improve reliability?

Got it I appreciate the time everyone.

That concludes our question and answer session I will now turn the call over to Adam prior for closing remarks Adam.

Got it. Thanks for that Pat. Um, and and from my follow-up, it seemed like the permitting environment for gas infrastructure in the Northeast might be easing. A little bit. Is there anything ngr?

Thank you and thank you all of you for joining US. This morning as always we appreciate your interest and investment and then Jr. Good rest of your day.

Bethany.

Steve Westhoven: I mean, you know, those are programs that we've, you know, have continued to make investments, you know, reliability, expanding the system, you know, making sure you hit customer growth numbers, you know, that have been great, you know, over the past few years. So I would expect, you know, kind of more of the same kind of permitting and, you know, conversations around it. You know, at times have been difficult in the past, but we've always been able to achieve, you know, that investment in building the infrastructure that we need. So I would just expect it to continue.

Be interested in be a growth projects or trying to secure system or Supply redundancy to support. Uh some of the customer growth, you guys are experiencing and maybe improve reliability.

I mean, you know, those are programs that we, you know, have continued to make investments, you know, reliability expanding the system, you know, making sure you hit customer growth numbers, you know, that have been, uh, that have been great, you know, over the past few years. So I would expect, you know, kind of more of the same kind of Permitting and and you know conversations around it.

Robert Mosca: Got it. Appreciate the time, everyone.

Um um, you know, at times it's been difficult in the past but we've always been able to achieve, you know, that investment in in the building infrastructure. We need. Um, so I just expected to continue

Got it. I appreciate the time, everyone.

Operator: That concludes our question and answer session. I will now turn the call over to Adam Prior for closing remarks. Adam?

Adam Prior: No, thank you. And thank you all of you for joining us this morning. As always, we appreciate your interest in investment in NJR and have a good rest of your day.

That concludes our question and answer session. I will now turn the call over to your admin prior for closing remarks. Adam

Operator: That concludes today's call. Thank you all for joining. You may now disclosures.

No, thank you. And thank you all of you for joining us this morning. As always, we appreciate your interest and investment in Junior and have a good rest of your day.

I think this is the next call. Thank you all for joining. You may now disconnect