NEP - Earnings call 2 2023 | NextEra Energy Partners, LP

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Operator

Good morning, and welcome to the NextEra Energy and NextEra Energy Partners Q2 2023 Earnings Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Kristin Rose, Director of Investor Relations. Please go ahead.

Kristin Longenecker Rose

Thank you, Anthony. Good morning, everyone, and thank you for joining our second quarter 2023 combined earnings conference call for NextEra Energy and NextEra Energy Partners. NextEra provide are Executive available NextEra Energy, Chairman, Vice of Energy; an Chief Officer morning will Executive and Light President NextEra Armando this Pimentel, President as Partners, as of all of Financial of Kujawa, well NextEra Mark results, Officer Kirk of & Vice Energy our me them of then Resources; John your Power are Executive and Hickson, overview also Officer President Ketchum, Chief and Chief and and and officers With Company. Kirk Chief Rebecca Executive team Florida Officer President Energy; Crews, will of to NextEra Energy executive questions. of President our answer be Executive

this assumptions, Actual expectations or key We of today's in the based other call from assumptions comments will differ be which news factors any release, incorrect discussed subject uncertainties. and on forward-looking during and making results risks the could our section our made the conference are www.nexteraenergypartners.com. do Securities the non-GAAP each any to materially update in not also during references which measures. Commission, statements if are earnings presentation of any current statements because in and includes Factors found with our of and to and financial Risk the in Exchange accompanying presentation the be can duty to of websites, latest reports www.nexteraenergy.com call, on forward-looking or filings undertake We forward-looking statements. Today's

turn to financial measure. With information refer the GAAP measures reconciliations I non-GAAP the accompanying will of to should slides today's presentation You the and the for Kirk. definitional information to in over contained closest call that, historical

Terrell Crews

morning. Thanks, Kristin, and good

results. our per benefit advantages of position. solid reflected Energy in record to competitive Adjusted approximately we renewable grew extend FPL deployed continued execution by the Energy second its track and customers our for as X.X% of leveraged Resources' earnings capital NextEra share as leadership quarter

that underlying an continues needs. investment Florida growth state to As population U.S., economy clear the in the and has fastest-growing drive

customer years, With visibility affordable, simple: most a strategy. settlement has our recent deliver through keep exceptional. service clear FPL's and plan has to reliable XXXX strategy our this bills on with capital FPL For been well-established the grid agreement,

with investments, This led transmission quarter, and to capital plan a capital which executed distribution XX% increase regulatory infrastructure solar greater and new year. employed last same the our than we in quarter versus

share As increased while We per by these year-over-year. a progressed FPL's result, capital customer $X.XX earnings bills affordable. keeping initiatives

efficiently innovation deliver FPL in fuel We identify capital X-decade with average. best-in-class We manage are than and actions, initiatives. Customers that continue renewables and growth. to from embrace costs. and these well remains operating among through smart as extend record multiple reduce our business technologies, and track costs, the deploy we Florida long-term and new is value below to benefit lowest more and proposition various as national uniquely including positioned O&M bills reduces run its and customer savings ever. we originating, Resources' the Energy of opportunities to the that cost constructing strong developing,

adjusted earnings grew over This quarter, by Resources new investments, year-over-year. of on XX% strength Energy the

on roughly projects We continue X,XXX approximately Resources track has quarter of Since storage renewables XXXX. our development over at renewables to through placed megawatts stands first achieve gigawatts, demand. renewable new megawatts XX and added keeping commercial see which to and and our solid expectations operations, our into call, X,XXX storage backlog, now Energy to us

the economy Resources and continue uniquely be of advantages, Given hydrogen all renewables the U.S. lead choice, to of to and our supporting power, the eventually, and of partner competitive decarbonization commercial is industrial Energy positioned customers.

far XXXX. at NextEra made have in so we progress the with pleased are We Energy

expectations. customers through our expectations XXXX. results, future challenging have to And our yet, Through our advantages the advantages our and Combined, growth headwinds. create we visibility we have adding to to let's we renewables XX deliver are operated provides serve financial positioned over in competitive environment value leveraged investors long-term storage deliver various believe we months, with with macroeconomic strong a to continue for For with on and visibility. well-established turn first year, both XX%. With NextEra through adjusted visibility comprising long-term business, of we growth X/X clear the EPS Energy with our growth FPL. backlog, to on well, Resources, earnings businesses providing of plan that, new the more Energy's well are our to detailed delivering competitive At leveraging and shareholders. With beginning than approximately our have FPL capital executed of XXXX half

reported $X.XXX was share, per performance FPL's driver For of growth employed FPL XXXX, the approximately second capital of approximately $X.XX $X.XX increase principal of year-over-year. this regulatory of an of net income year-over-year. XX.X% quarter billion or The

for FPL's We expect X-year employed average approximately expect which XXXX to FPL billion. capital $X.X realize roughly our capital settlement growth agreement's $X.X investments term, between continue annual the we through and regulatory quarter, full billion current to and to X% over be now XXXX. FPL's capital were in $X.X year expenditures billion runs

FPL's regulatory ending months purposes June be approximately for XX XXXX, reported the ROE will For XX.X%.

we During with $XX leaving million approximately reserve of a amortization, balance billion. of $X FPL used the approximately quarter,

to Our capital projects well. continue progress

FPL to the customers. the solar for megawatts XXX As alternative in into Plan, total we our our additions in nearly year-to-date roughly Ten-Year continues the lowest indicated recent bringing Site placed X,XXX service megawatts. solar cost-effective to be quarter, of solar cost

XXXX. settlement us X.X megawatts the while customer Over remaining over strong investments generation affordable solar X,XXX of the growth X to avoiding With megawatts new serve commissioned fuel current purchases. solar years, add clean, years under providing solar and roughly generation. X,XXX FPL to last volatile expects of allow has agreement, FPL through FPL's incremental

expect June to we to a of billion little $XX through plan Over cumulative approximately settlement agreement, approximately as X-year new anticipate of our capital investments in between investments total, capital $XX $XX we solar to and our We remain original $XX continue our of through in FPL billion are transmission of XXXX total capital current distribution infrastructure. XXXX billion ahead time $XX line. investing billion. and in the confident make $XX approximately to generation Of that billion billion

plan is well industry. I'll Our are one now growth. the executing is distribution believe by investments, which and deployment on solar of we value transmission and demonstrate best the enhancing propositions the Florida capital and strong in what to we turn to investment customer established continues economy,

prior past year, standing continues and below Florida to nearly compared while the the roughly U.S. new Over ago. sector consumer compared is and X% increased XXX,XXX to private currently versus the to and which decline, improved unemployment trend Florida's average, U.S. mortgage a XX to created rate approximately declined rates year. over XX% the GDP average. Florida upward has continues X.X%, the roughly prior sentiment above by its remains at XX% delinquency basis year year points jobs,

per basis by year second impact quarter, prior X.X% solid from had FPL's account, year XX,XXX negative continued the second weather period. increased than taking approximately basis. X.X% solid the population of a weather-normalized customer growth. roughly comparable on with period, retail During sales on the After that by year-over-year a quarter a driven growth the prior these customer X.X% had increased average FPL from primarily on usage more estimate approximately retail year-over-year. comparable underlying by factors sales into of number increasing quarter slightly customers We

approximately GAAP were share, earnings year-over-year share. Adjusted $X.XX year-over-year. let's in earnings $X.XX million per were or per earnings approximately per for resource. clean wind $X.XXX our Now from share. second billion, to of increased or portfolio is adjusted a an turn quarter second quarter investments declined in $X.XX Energy share $X.XX the share energy increase new per which XXXX $XXX Resources, mostly where $X.XX to was Contributions This existing from due Contributions swing year-over-year. large per decline

to in relatively the contribution XX the our to $X.XX on other in wind businesses highest. The customer year years, impacts This the by while second higher per by share. of earnings quarter rates. The borrowing which customer-facing business is driven costs primarily This increased from higher of factors, reflects share, investments supply $X.XX support new to development to compared of per and decade. to plan over interest the share, by due the and due per as All a quarter costs $X.XX combination contribution past investments we interest the was of new other due part early-stage to in weak higher latter additional last record is quarter. half a was renewable impact of prior which lowest growth trading is decline for costs reduced including margins our remaining support of half resource year

X,XXX renewables storage a and of approximately adding to origination, Energy Resources the megawatts backlog. new solid had quarter

expectations XXXX. Having on gigawatts range we our service these within since megawatts years track roughly XXXX now achieve of call, placed With which the totals development taking expectations to renewable XXXX shared expectations new through only keeps first XXXX and to quarter our account our the X.X after the midpoint already backlog our to roughly next new range. X us months gigawatts into XXXX ago, projects XX just X,XXX additions, XX need of to expectations achieve over development into development over the are

to we Pool our storage this area first is contract monetize As pricing part This the renewable-rich an opportunities in serve the to of signed storage be a country. capacity battery Southwest stand-alone XX-megawatt additions, facility. expected arbitrage backlog needs Power with customers' project our this project wind quarter, existing available for and our growing co-located in of

value we including of highlighted, here. portfolio, have existing many more believe are co-located the our we XX gigawatt like to deploying renewables monetize opportunities storage As we did operating there

this operation. excited into We to bring are commercial facility

and combine have signs and alternative roughly price quarter, believe be our business diligence by disruption inflation, and of projects. Today, our Energy competitive see positions. positioned backlog demand XXX renewables policy is renewables renewable to expanding supported Resources power our we well We ourselves will of of meet risk long-term roughly the advantages we development. of pipeline XXX economically early-stage renewables and pipeline, storage customer in projects in believe come. premiums, helpful remain conversations. a attractive commercial of includes trade our underlying After and When gigawatts customers. pipeline growth generation of in with we to supply During our of for demand seeing finally to projects to period are stages which This is storage by have a queue customer solid and renewables forms of chain current years various commodity and we and stability, gigawatts significant continue in across you industrial positioned significant interconnection renewable for our for

best-in-class excited advocate drive to our by increased early-stage we remain hydrogen the Throughout renewables robust also to quarter, and help would and establish customers about serve smart that continue for green We opportunity penetration. hydrogen policy leveraging U.S. a renewables development believe we expertise the market the position. hydrogen development

developing our and should green as our Energy that into executing We and renewables an energy translate potentially pipeline could this be also new Resources' simply appropriate operations contribute the of memorandum thought progressed serve customers' related with regulations as another understanding hydrogen explore facilities hydrogen our begin hydrogen-related green to by into and opportunities decade. of later class all to integrate to additional Hydrogen growth of would additional projects their renewables needs. customer potential

our Turning consolidated now results. to

second per share. were the XXXX, GAAP For attributed billion, NextEra approximately earnings Energy to $X.XX quarter $X.XXX of or

$X.XXX by driven and of decreased year-over-year, $X.XX approximately Other recorded of from primarily costs. the results earnings $X.XX for Adjusted Energy quarter. EPS NextEra the higher adjusted share Corporate earnings in adjusted and interest -- per second by billion segment

rates to continue ways. manage in multiple We proactively interest

increases mitigate $XX the of rate to help rates. NextEra in Energy has First, future various billion impact of interest swaps

yield. FPL in XXXX, ROE the became sustained interest settlement adjustment rise Second, amortization as in mechanism, XX-year to on agreement the reserve to effective has and such X, which higher due a Treasury rates, September offset U.S. features its

our offset costs. ideas interest cost on in velocity has through to Finally, continuous help rate opportunities annual over productivity yielded the X $XXX run savings years, our focus savings over last improvement million initiative annual creating higher

always, current financial into is interest account rate in the taken expectations. environment our As

or XXXX, and our the while Our credit long-term at of strong adjusted From in our financial to our and to near sheet XXXX, rate XX% average per we're above least expectation the financial XXXX EPS off at a XXXX not that compound continue annual top from be base. grow maintaining our roughly growth same remain growth per at to we be flow in if at each balance time, EPS And expect expectations year will our we operating XXXX annual range. able we continue dividends results share or unchanged, through to adjusted to ranges expect at year cash XXXX will ratings. end deliver disappointed to

normal As expectations always, conditions. usual and our operating caveats, our assume including weather

turn NextEra to like Partners. Now I'd Energy to

distribution for wind available adjusted $XXX respectively, and EBITDA quarter Second weaker million, were reflecting million cash and $XXX resource.

last of common of announced its is on LP adjusted wind to its -- acquisition expectations distribution renewable earnings remains NextEra distribution. Yesterday, our become Partners NextEra the run XXX XXX% annualized XXXX this earlier. of and well is deliver The or partnership XXX% producer Inclusive rate the Energy company. distribution a largest Partners' per acquisition, a completed approximately electricity simplification Energy as from available position of for well to declared per previously IPO. Since NextEra of year the Partners a on for quarterly EBITDA wind Partners' seventh since assets. Energy Board $X.XXX plans megawatts cash NextEra megawatts, basis, share call, and Partners to and common world's NextEra unit, further grown strengthening portfolio its $X.XX per its quarter, positioned renewables-focused unit this an from sun. per execute its up approximately solar With on unit over Energy has XX% over XX,XXX positioned Energy

sell simplification this assets for process plans, track as remain our May, year. this launched progress the in to later on by the we the Regarding we with natural are pipeline and sales portfolio pleased gas Texas

at-the-market expects near-term Texas planned proceeds the in NextEra convertible NEP equity to issuances Texas gas sale, portfolio financings: equity equity sale, Pipelines. Upon partnership other of XXXX our fund Pipeline X on the portfolio portfolio beyond use natural Pipeline from to to opportunistic does and XXXX equity Meade program execution II Renewables together future the XXXX. with equity successful Energy NEP buyouts Partners STX expect XXXX the the pipeline to under Midstream, than eliminate growth not require through the the sale

detailed the to results. Now

Partners primarily cash large contribution driven million by EBITDA in distribution The wind year-over-year $XXX declined impacts projects approximately available Energy weaker and reflecting wind from $XX NextEra for delivered million quarter distribution million, for by cash and $XXX of respectively, a the resource. respectively, and and second resource. EBITDA of adjusted $XX available adverse existing adjusted million, swing

XX the was year quarter on years, while This record lowest quarter resource past the wind of second last the highest. over was

contributed million approximately $X distribution. adjusted of million of available projects New for and $XX cash EBITDA

for by suspension partially were the approximately resource wind Second of fee for impacted performance. available distribution adjusted cash EBITDA quarter poor of distribution this provided offsetting quarter, positively incentive $XX and and impact benefit results million rights the

year we full the second NextEra and shared, XXXX. expect support growth for Partners' As distribution double-digit distribution in range EBITDA available growth we previously per the LP year Energy to of strong cash half expectations in adjusted unit the for

base XXXX. in as Additional at through details a per least to being are of shown unit range per rate accompanying to unit year XXXX reasonable distributions our fourth on continue $X.XX, we expectations LP common see the at per XX% quarter of XX% annualized of distribution growth a slide. From an

However, or as that bottom we've at with you, previously range. expect to end of shared we grow near the

to of be $X.XX to expect of XXXX payable per annualized unit. is we February XXXX, a distribution For in common quarter the $X.XX of XXXX that the in rate fourth range

to contributions run of adjusted XXXX, for December its the available from billion rate $XXX respectively. million continues and $XXX to ranges XX, cash for at EBITDA billion Partners forecasted expect and $X.XX $X.X distribution to portfolio be to Energy million, NextEra in

As from a XXXX. the XXXX XXXX rate forecasted reminder, year-end contributions at reflect portfolio year-end calendar projections run year

hydrogen the provides Energy to Energy capital business for than growth In and capital the transmission capital Resources businesses which we're benefit advantages and terrific will strong and pipelines new that well these our FPL expectations XXXX. years to summary, backlog, opportunities than efficiently deployment value investment enable providing are well Energy of business a long-term through more renewables into us our our new continue gas opportunities set than customers. plan, growth FPL, for competitive costs customers, on NextEra competitive and of subject for As and choice, Energy, Energy's gigawatts growth NextEra experience With opportunity earnings proposition. Florida's and plan $XX NextEra capital toward executing benefit Energy investment, our amount to of including NextEra customer share decade. At Energy and Partners potentially grow and value renewables, of eventually we're our X/X shareholders. running always, NextEra now for of of we smart to requiring the natural of unitholders. At roughly executing allows on We simple, caveats, are capital and visibility in leveraging XX us to advantages conditions. sell commercial shareholders. investment normal usual shareholders business. our billion significant of weather add to gigawatt and providing population deploying XX more allows partner delivering drives extend to our operating our is Partners, an well-established comprises visible customers X our our both the and to are plans believe At growth. At and positioned and the market industrial the Energy manage Resources visibility power, green to believe positioned be Resources, the is end creating of hydrogen of the we're XX simplify serve more

megawatts. stands to our add continue over portfolio, XX,XXX and storage which now to We renewables at

transition distribution happy of continuing to the completed to to questions. to we're remains XXX% pipeline by Texas unitholders. With the natural the renewables end for a NextEra expected answer With unit growth year, of pure-play gas on deliver portfolio Energy company be per sale Partners track the LP to while your that,

Operator

with come question first Wolfe will Fleishman Our from Steve Instructions] [Operator Res.

Steven Fleishman

Yes.

So a couple.

business supply do and to quarter. First, The well, you trading margins. higher mentioned the continues just on customer

supply think you is think talk about driving about Could that, that talking has been too. just what the in Constellation business? more I you

John Ketchum

In number business, one. competition, two, most activity just business the a of group lot we've that trading Steve. -- in John business. and Ketchum. remember, number This supply the that And do Sure, is a seen is customer-facing lot we Yes. less of customer

back-to-back has example, working to requirements business, full the cooperatives and manage positions. their less -- to need is where are arrangements Northeast. the Our full a or capacity margins. And please, help municipalities had and they and we years, one in in points ancillaries it's want from hedging provide with into lot that business, arrange to typically X up we're business the competition X the immediately I their going business regulatory requirements for make other significant particularly [indiscernible] we're benefited those needs and is because power requirements of enter and these That

feel So risk terrific operations. profile. again, margins our with skill match competitive I great the sets, our well And about up that our advantages and really core

remind a So to when low the very, about at that's main driver. And VaR. also supply think you run customer we and want it folks really I that business, our very

the example, roughly quarter, we that a For X% last business VaR. at ran

So it's very a for risk very, exposure small business PMI. overall

Steven Fleishman

Okay.

on... just question Next

John Ketchum

the than on Steve, We XX% done that more is of one to trading supply want And net a run can has other too, has I keep of year, and lot complementary historically, to well. in go XX back income. well. think have mind this important point supply business never you businesses. as Obviously, customer including NextEra and contributed FPL that's a Energy's -- I years that, we make, customer business, business, the

as make Energy top under of rating of agencies. we commitments well. We Resources that have XX%, has that's and year that's businesses the other true to one the stayed this business. our renewable complementary And that But business on always that

Steven Fleishman

Okay. Great.

of where and just latest on color you're on maybe of -- green from some any hydrogen treasury, kind Just rules issues both the and matching the the hydrogen additionality. like timing are key hearing they of --

John Ketchum

Yes.

it need matching. are matching We that debate very annual we come together. around it's with for have to those hourly or whether been a there's vocal hydrogen between regulations us, familiar And have And very for that simple. been the

less number you day you probably if matching, part an hourly use capacity of most called day that hours which expensive electrolyzer of electrolyzer, are that than an the As buy factor, a have is country. of hydrogen a familiar the with. And in half asset the project, net the parts everyone you

we're annual an that have use the If you electrolyzer to able clock. construct, around

math. I it easy use lower a it really the you have going lot an [indiscernible] expensive asset clock, time. can green capital you the you price only when it's can to less use around mean, be so than And is and hydrogen half the of

to And you'd industry construct hourly very matching would we period. you're annual so And if until that qualify not supported a also proposal, the until to XXXX, going annual. the kick for with have the that additionality have come have forward constructive has in go have fact which time have you

if from are the the power, the the sun to So or annual developed newly that blowing is and wind facility. buying buying grid. electrolyzer to for that hours been in constructed you additional is meter the the you're renewable that you're hydrogen qualifying behind off Well, not the provide not electrons and built shining, asset has an

NGO additional So getting from an decarbonization benefits on perspective, you're grid. the

very been we what to want scale be signal we've produced electrolyzers send think going constructive have we up prices green in think because to time. declines the it's in on ramp OEMs important to production being So come at hydrogen we because We over to important electrolyzers to particularly really with. right is forward price

are around And in we so that's terms of timing. your where question

to up or diligence like sites. Nobody regulations renewables Parts October. class portfolio under that the a August, XXX hydrogen just hydrogen customers Kirk it pipeline probably and our But include but positions either it early nice our said sound -- dual lining about nobody. a which in remarks, sell again, a industry out, can it's the to hydrogen with September pipeline of for used for what's is because when expect the terrific about be them now it customer and out third it are that, land to is significant in We're that that gigawatts And you billion, to. pipeline hoping for due that, starting about treasury has like purpose had thing is we We land have and come built over team very aggressively well more have now. out work pipeline. $XX we we've construct and

will So work for it if C&I our hydrogen, work doesn't power, for the customers. site

boom So hydrogen really the really you. positioned, things of we out a provide feel like we're those and nice to that laid expectations one we've is already well development that can for

remind cycle, that eager say. decade. so hydrogen also contribution regulations final see to would part want we're But a the folks see hydrogen So of we'll the that what I has investments, from development the expect long over latter the to you

Steven Fleishman

Okay. Last sales. the on question just Texas

So when would how I think to you the we've year-end? year-end. data like know And sell-down they're should to would the we TransCanada, but done recent -- Point. NET. valuation or of expect different the said just announce think still in sell-down, it I about that get need you the points of to you on by assets, seen TC Cove need views the to kind context When and make expect of just Columbia transaction to or

John Ketchum

Yes. Thank you, Steve.

me in let order. those So take

So order that support in of line quarter fourth to end the terms earmarked. the of timing, have of time in end quarter, year we be to third would we that a hope early position sales in

In players. And fully terms gas of around Texas liquid they that assets as number very, Pipeline for strategic gas a [ are assets these support contracts PEMEX are to is with and pipe. that of a you of to Dulce point. reminder, these trading that view Mexico's a ], integrated the the look very And Pipelines which provide as area, supply if Agua very the unique. Again, provide with the XX% natural other Mexico pipeline Texas the through valuation, we

make But on it's progress VaR to PMI, know, to I $X said with compare you X% all transaction. And that. million correct VaR, again, the pleased pipe Steve, I to to the hard we So the remain think again, on I meant just continue on as the for that we another. one comp sales

Operator

Our next Partners. Pourreza with Guggenheim from question will Shar come

Shahriar Pourreza

tight and still of for developer -- fairly of platform to kind picking just competitors, yours, at guys your me have of renewable Let portfolio of the any up as seems a improvements look the Do be noticeably. in leverage existing other while supply [ given we financing valuations especially position see and assets books, with chain seeing come ] opportunities you latest NEER's right? transactions, you're kind the what sort some or to

John Ketchum

that resource. and renewable high-quality you don't have the them other solar of our bus that some we all, the of just not Because they're to look mistakes mean, that wind that resource, But are the very you we experience, perfect, if think are transactions, are valuations analytics are. of mean, assets I last first but look, you make structures critical congestion, I assets. continue characterized we let me some of those of develop years of come the see. XX situated I'm of are developers renewable on to in the lines believe of years not details some XX around see what Yes, we high same from going transmission back as -- sale. you I we of make. that I well Most like areas bar, offtakers. They developed to comment be the high-quality counterparty what data through those read over at with the credit and assets. When to look the into not have have benefit

better some feel than of positioned so much other And the we're you portfolio our I like much better is have position markers a seen. that

So because I'd be very, very portfolio in how different. very they're careful very, assess you

we cheaper. that available. feel of thing cheaper, do you come all we mentioned, I operate we is we buy which second build like opportunities advantages, cheaper, some all the third-party say And have The competitive we and M&A look would we at

capital cost We of have a advantage.

that always benefit the that able with, else leg on something that we operate. the a a organic America others is a it's have and industry we've us terrific of fleet nobody today, have of then had team a largest that Kirk gives very and existing key the the to understands see up Repowering an strong and in in value that terms North don't. And mentioned call real which to as asset something being we We has, assets value how optimize really is assets. piece. rest struggled record of track That's that has the the

but take storage And not repower so with pair advantage find we ways those assets stand-alone have them the existing up to only of the and to ability to ITC. storage

only to The have pair As storage a IRA. to changed with all rules storage know, you solar. it unique ITC used be opportunity under the with stand-alone

in we've an We're priced of So can past, a it shortfalls announced of the values wind. ERCOT, reliability given where existing and where in those with importantly just build to some seen given wind starting them very MISO with higher and We pair to opportunity, given that now we're that that assets being capacity to interconnection particularly we have. agreement, and one go unique or most the fleet X today those it progress and industry, which have, markets, we of start than ability area. with pair this the lot they our is we are and project SPP existing in that up decade in solar to an see coincide them have that happened massive stand-alone. repower the includes making We our in head is. And where

to other we value when well a capital including we advantages, competitive our that of our try to that's M&A as opportunities so advantage. bring And exercise cost

Shahriar Pourreza

around any of today? a little settle? hasn't then John, sort focus as quiet, bit to And stance FEC indicated disclosures, in -- any But for it and the lot Perfect. updates investors. really is case of it. a opportunities been by there of a Got been change it's and as Any the

John Ketchum

the probably back new that There's developments. historical news that a on XXXX. have they FEC the Shar, we Again, really should where expect hear for no just they we question. based Yes. the sometime of precedent with Thank reasonable there. first in No belief would quarter investigate you, would

Operator

Bank question of with Julien Our Dumoulin-Smith from America. come will next

Julien Dumoulin-Smith

where to the back execute just bit first little And et on cetera. looking terms of How you're towards the that bucket later on versus come what nearer-term close us IRS a years Can bit cadence hand stand 'XX-'XX to you here, you to means there just willingness you about ability here? ] that that in transferability, additions commit at the biasing maybe execute on of against to sense now give the a and there. wanted 'XX-'XX to [ out update talk of for given there, do about backlog seeing latter little versus I already? kind especially what have the the think the in in clarity So to we of contracts especially maybe an that

John Ketchum

Julien. question, Good Yes.

just that everyone 'XX. start in take development knows me because are our 'XX let to expectations So chunks with

X So we'll about let's start talk X years. years, first with just the and then second

we We're get you So great today, 'XX, And the we within go you work already XX in and for to beginning back shape. years up where if 'XX last 'XX we've through great if 'XX, quarters. had already then 'XX, expected be. from 'XX gigawatts X.X to shape of that's you midpoint. And as just of XX now and in to to get are us the on to we're have add because added X gigawatts kind against puts That XX the 'XX in gigawatts. 'XX, the and we backwards range

some build. industry, real just I And feel we like start track seen Julien. think renewable position in I on we're forward. And there's the to part in going want we've which that see So some your we of to that was come tailwinds question, to what around really explain dynamics and on are great

period country, those Let's ], the delayed short that supply some the also scrambling of It that thought chain saw of I supply were could is digesting 'XX, lot into [ to and got the And caused those COD those delays. just because to saw shortage commercial panels for to that which back time customers now mean of because a are market. for a get now they the for projects we caused in surface. starting great customers 'XX. a all news into That's we then developers here build that operation. saw 'XX they prices coming I go for are think waiting really flip issues were go we go projects that good thing to up. The some 'XX started in that into 'XX back 'XX circumvention drove to up

we're we from look so seeing folks forward. strong really And as to start demand those

see used issues seeing to worked holdbacks that up you ], we as The the through. [ that start to We're flip is benefit see. other of you get flip up not

this front. meet have as and okay. with from clarity you're on making that When into circumvention, of you bright-line account long that you that lot a Southeast X, we with the seeing So the finally importing X take now of around ] and we're as X-part Asia, tests progress the you're rule [

a what we've relaxation is that. of seen result so And in as pricing a

now is So come year by the the down. import being starting risk premium to that last was market charged

part price is solar really want the other U.S., is for $X.XX They selling price the come for panels $X.XX panels starting a risk in market. Why The everywhere still down big sets of wants the Asia the U.S. a to part of panels around U.S. They've but in premium the U.S. else, pricing roughly we're Southeast market? been do Southeast right? that that big they and for terrific that Asia phenomenon seeing sell

move. have they So to of a lot room

a getting down circumvention, that prices it's you're come online U.S. At And will time, with flip are that so supply facilities [ come risk and around, forcing also module through the in lot as along you facilities announced, premium down the seeing comes ] it. new through same cell more U.S.

capacity so is Asian because are you're come a line equipment particularly data evolve. some down as secret positions. market those capacity see of standpoint markets when -- lot that U.S. of bottom out price prices picture, of excess you look force some the the is you starting time, from pressure favorable going it's online coming Southeast to think economic at with an capacity over And that to the I And it's with no of the under see China solar

down has really to Battery see in seen find things coming created in batteries. panels prices, the battery China, are and batteries well. to market struggling prices of really which with. capacity a struggling much -- got We've to need they've so excess EV do finally relaxation as in they And very around

starting some see there. finally relaxation we're so to And

the exposure and there, forms. other there's lithium-ion been think of a sodium some more around mineral of rare see you battery and traditional movement I

domestic landscape the then really reap one in on of can about full there. And very manufacturer OEM the are full of wind the ones only encouraged benefit so the the incentives. And side, content that the wind folks

about So feel as sits really where good well. wind

credits talk and line you to to told that in saw in going with how's we and 'XX, chain coming that supply forward as of to been in the investors FFO move for look around feel metric?" supply we we transferability saying, flows the included. through lot tax it's very 'XX let of to the start issues to about for a heard online is questions be the feel combined me a debt And tax great think lot a the started these globally we've time second. with long I through So projects accordance of be part There's We going excess chain for? there. And about a to capacity discussion, I've accounted that "Well, good feel get transferred for it be and very of FFO folks transferability GAAP, good, it and

surfaced up feel we that to about heading good that a so around that that is transferability. and And with has place FFO there debt where in we'll end good -- question

let's anywhere. started. we good to face where together, that all put we've things We're it. work of we very here heading, about just just through feel these and getting Renewables stay. going are headwinds They're So are when as those you pieces not some had,

future. development shape be straight might a line. always we and in terrific We're -- the feel while so to And optimistic process very going isn't about the

Julien Dumoulin-Smith

that that in just like an of trend argue half? here that on the the you feel more uptick lot versus of quarter you points trailing of though, contracting kind time, in the the you about just acceleration I could if of the back made really quarter. talked How that see a Right. would a point to mean was And something last do you real itself. you versus into lot actually, will, about are John, very kind dynamics

John Ketchum

lot of to we're delays continuing back depend bit online speak, market, come on 'XX projects little before, it to and fatigue, those A see. that going starting in of as around those said to XXXX to to I customers -- is Yes. a these coming which had so

wild year to will that we so about up. of shape But feel be the continues And how card. the good rest the

Julien Dumoulin-Smith

Got front. right. that Excellent. it. We'll on stay tuned All

John Ketchum

the get that And And customer enough. to we've there. only I Julien, We one I been mean, is hydrogen. other X rules to It's always the It's power been stress sector. sector. thing C&I right for renewables. can't add again, classes had it

Now to customers, for third renewables the with customer the that's add exciting well. a hydrogen we class, as rules, and potential which right have the is

Julien Dumoulin-Smith

Yes. Yes.

third you really get to that that tuned, maybe So rules through customer X those stay after see class? flow a in quarter or

John Ketchum

think time that's projects right. Yes, remember, then I cycles. longer have development And those lead

investors that latter contribution part expect, in it's the to the going decade. the of terms in So of come should

Operator

question Morgan with next Our will come Arcaro David Stanley. from

David Arcaro

equity hit wondering just bit -- of a -- wondering to was financing NEP. on here, don't at approaches I give growth shifting for I but alternative the know some NEP? little any time longer-term don't financing to you thoughts Maybe projections could in was outlook, terms if I you you need latest

John Ketchum

with back finance and under to going of what help the forward, to our think move flexibility current the opportunity growth the at be development to gigawatt a but see world's the growth that point XXXX. But for the that of the that can debt-based simplification the the we of other -- from here [indiscernible] don't bid a market look, interest would term, advantages than continuing simplification to that interest XXXX [indiscernible] with that visibility, some ideas going ]. And -- XX in on competitive call, looking with particularly we accommodate be for not look, on busy in shared forward. you next if we equity add slides is with very we ability there back I continues the terms We're around which going all to when assuming focus as to ATM first we our and execution as how renewable lot renewable have expectation leader are that because have -- is have the in expect the Yes. are long the in strong the issuances X we're address have, not we we have we about result under you NEP, focus. a that's sale that our to the to market in requirements that on in going waiting. metrics look do promising. all, mean renewable the financing when growth of at opportunistic [ backlog, I assets end, in May. beyond mechanisms said very the traditional well equity strategy, And that we and agencies successful transaction, we capital don't And of to additional, a We're you those

in And as about those discussions we future. engage well think so we continue the as to

David Arcaro

comment And queue related industry, in it. I longer-term potentially question interconnection constraints had we've the the could that a made it. to got also, you but do seen you growth transmission position, do the about at you wondering in you the that on transmission be just could with just And speak a a Or to if growth Got industry for visibility large targets gigawatts. Got queue any think hitting then that much place? the have XXX I how into was that challenges. constraint you've massive point? very

John Ketchum

Yes.

even interconnection why don't we forget, just a the making find of challenge gigawatts pieces. demand XXX anybody close is finding X we're around the have XXX our where seeing a you're interconnection I interconnection in that's gigawatt secured, position terrific capacity. the that that XXX customer program not stand now that's And that on and that sure development market, early-stage there we focus feel track, already has the have, go And -- site if today. is mean, part, so part. referencing, such hard have David, the I with we hard right about number industry is on projects me have with -- the given to you capacity, right with the pipeline that ready I let take the would So we X you to to that the in in

Let that in which transmission second take piece, general. though, me have, you about the just is

waiting. We not are

we're our that We interconnect doing issues Energy and through are And Transmission. own NextEra the into transmission taking hands.

problems Cal where board the GridLiance. talk are evaluating. laser them quarter, where number That to other going transmission opportunity again, are intend announced ourselves are going on business last We're we transmission focused ISO. line around investors $XXX our we space, right message continue now That's not taking project that as terrific. And why we about we're investments for another I'm to we and of those build-out assets various on the waiting. own but we bought have going a is solve going today, our competitive are they We why that not renewable and into a to That's built. We we be is bottom that hands. make million in go in projects to along.

Operator

Our next Sachs. will Davenport question with come Goldman Carly from

Carly Davenport

divergence supply wanted any a and commentary Just seeing recent chain, you change trends relative perspective of versus back chain are solar between rate to just go thanks in the wind quarters, to to projects? for in from of question. But in the projects terms supply earlier there the

John Ketchum

yes, of done -- make Siemens we We've with in turbines bit all And me want I mean fleet. do just make couple of projects, to mean, our a recently. very I been I the wind terms GE. of press almost any have Gamesa little comments there's our don't a of let know with terms on just Siemens businesses Siemens. some I in there. that In We clear.

the made almost are As solar, versus we think turbines that about remember supply chain U.S. around in wind wind exclusively

more and couple get there'll and they They of a we've plagued And lot well. the there flip they domestic same things those paperwork, continue with, solar, been margins around be they away we're ] on their content. have not only 'XX. on now the sauce in starting work earlier, exposure working to and secret kind again, to what customers you have a to have And so of hopefully, really with I have things manufacturer to circumvention. But [ around issues. work but as U.S., when had those or which share with doesn't in terms and as through in deal industry see to in those the we've issues back information said of through things. But giving or But with that 'XX just in solar ultimate the treasury, markets beneficiaries other of out will around been that hope up which capacity have we show incentives, the direct all issues

we to are on expect buying And power and would our so opportunities leveraging do. all those capitalizing as you us

Carly Davenport

it's levers challenging seems Great. improve for managing cost pull from at That's the exist environment. continue quick you're perspective? how then costs in high to environment bit, you needed on starting but to what Can this many. to one a about available helpful. a execute just of and just an if like still kind the level And are is talk earnings that a kind It follow-up to of

John Ketchum

Yes. Thanks, Carly.

and to through with the X in for success years. years, if initiatives, identify up ideas fact, call million we how we that year. this, last a look know at we've to last the In the you at we've under familiar it, process savings over I challenge business This with we our So run amazing name company. and Velocity we savings initiative that able we at bottoms-up last $XXX It's FPL run savings been every every about, our spoke of of had cost you're come XX cost program year Energy ran year, it our we one cost units. both on Resources. called over the a same last company. And And

it's that constantly also G&A think whether is have to that last we well. We a as the we how leveraging over launched AI way we able recently to leverage out program in build of the we're technology the ways have to O&M, business generative to as technology. all run a that never AI for XX Technology skills of in looking big it's piece and business, So it around we the been years leverage XX really terms we've continue massive of well. to cost do we whether how take a

cheaper, electricity, development things, game it's of declines you're next in selling on in laser-focused line a a great those about it terrific together, you sheet, equipment of contribute renewable our we it progress A- all cost be And have building commodity, cheaper, developer all time so when terms share through the feel the to are inches, to we then and cost. And financing the of got our than I how But things with it buying of to operating cost continue balance cheaper, advantage. position, those the And we better put development capital think, a we're cheaper our to when market going competitive for program. and business, we over business.

Operator

today's this -- presentation. Our concluded. Thank next for question-and-answer The has question pardon our you me, concludes now conference attending session.

may disconnect. now You

NextEra Energy Partners (NEP) 25 Jul 232023 Q2 Earnings call transcript