Earnings call transcript Q4 2022

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Operator

Hello, everyone, and welcome to the Eversource Energy Q4 and Full Year 2022 Earnings Call. My name is Nadia, and I'll be coordinating the call today. [Operator Instructions]

I will now hand over to your host Jeff Kotkin, Vice President of Investor Relations for Eversource Energy to begin. Jeff, please go ahead.

Jeff Kotkin

we the and the in Nadia, call. you, apologize delay for starting Thank a webcast with had were problem We having our reset. to link, be it and We the with the couldn't working. only just start dial-ins call,

patience we the after greatly, So remarks. your and look your intro forward we questions to appreciate

me let morning. for joining Thank So, you Good us. start.

this And Litigation forward-looking, of we'll see materially on can defined and be call, forward-looking we afternoon. the this statement's are meaning from These Safe forecasts you made forecasts Securities actual forth slides that which of are expectations risks XXXX. maybe to posted Harbor the the X, as current uncertainty, some and the yesterday investor yesterday within the During provisions and referencing on as projections. management's Act issued Reform US statements set news during our release subject may are call website. of the slide Private differ based in to These cause on results of

the – for can XX-K XX-K be XX-Q three September Additional information our our differ results December XXXX Form in for on XXXX the and months various actual cause about the XX, Report XX, Form Annual year found I'm to ended the sorry, for may that was ended factors XXXX.

and night, last XX-K is within posted our contained our use Additionally, certain and measures results GAAP slides, XX-Q. non-GAAP in how we and we explanation and why most those news our to measures and reconcile how and the recent release

us our and President and and our today Speaking joining today Vice Moreira, and John be our Chairman, Chief President Also Buth, Controller. Executive Vice Jay is Officer; Nolan, Joe President will CFO. Executive

Joe. to the call will slide over turn X, and turn I Now, to

Joe Nolan

states strong thank you the operationally, on for energy XXXX serve. had you, financially very a this call Jeff, policies us advancing of in this we clean morning. We the Thank joining and everyone

customers' on positioned ready, expectations, to providing extremely the of XXXX, reliable or we them emergencies. consider As impacts whether be and deliver address with and to look ourselves relates we to change, communities respond to safe our climate well ahead to prepared to helping it fully service, standing

work undertook, to customers. before Christmas hours following our We two in employees to year, before bitter windstorm, the XX the days last exemplifies hundreds appreciative The of we've up had holiday, of our and customers working colleagues. a selflessness of thousands a received temperatures ensure during that Eversource from severe treasure the X,XXX power, comments day, our

leader we values among largest saw efforts, on by a focused diversity, as recognized we a this aligned corporate social our non-profit are report, investing. responsibility, On and published in the new area advocacy, nation-leading shareholder and as ESG and and X,XXX a you equity inclusion environmental corporations US

company. are We the on equity new a completing now entire training across initiative

target had we us utilities take only announced that step. one setting a In that November, science-based or gas few of a we making to to committed US challenging electric

portfolios. an Eversource receive We that from for the continue investment and US and on positive to very differentiating believe many investors factor both of become it will in our non-US feedback increasingly commitment

illustrates gauges our some two of service with -- of starting metrics our key X Slide very operational reliability. electric key

occur Our decile quartile. highest in restoration the industry interruptions our months customers' of top the outages when speed remained average number of between did of in in was the

Our metrics strong. remain key also safety

something non-GAAP financial our have XXXX years earnings nearly approximately dividend of ago. we was formed terms done consistently continue our performance, that we XX since X% In by to Eversource in grow

X% share move next our upper our X% to additional over factors our of increase shown earlier on that growth month. will As an Board solidly years will earnings half long-term the we in approved in John dividend this to the the X, discuss some X% quarterly five slide per of expect range.

our with offshore peers, our understand While favorably investments. the wind longer-term over much return to that our return was related uncertainty disappointing. that our is We XXXX shareholder of total compares

uncertainty in as review to months resolve We the our expect coming that strategic progresses.

XXX,XXX There are is offshore our acres joint uncommitted part continued of interest progressing in and nearly wind is The extensive venture due of continues the through that lease move both our areas in XX-XX process three with projects Ørsted. forward diligence. to

expect moving announcement work year. projects second in of ahead. the We meantime, of three an outcome our review concerning the is the this the quarter on the strategic In

months. recent X overview the Slide progress quick provides significant a of in

shore Long As now Installation the project the you commenced Fork Wind is to roads to of cable South is track transmission know railroad construction that onshore and and hold land. and is our be onshore Installation sea as our the will transitions town of completed a year of substation as system is complete underway cable vaults first on construction ago. installation Island onshore summer. now conduit new cable the to along of of this conduit it including the

will wind installation cable foundations, quarter later the coast South this and and begin begin Installation will off the offshore turbines of Massachusetts. summer this of subsea transmission substation the Fork of

the We year. operational be end will by expect South the that of fully Fork

Our through this citing Wind, Revolution permitting, to half second construction larger we continue offshore wind and the both advance and in year. two commence projects of Wind Sunrise projects of expect and to

Ocean impact Revolution Bureau issued environmental Wind for The project a of XXX-megawatt in September. statement draft BOEM, or the Energy Management,

have in second EIS and a permits quarter XXXX. all expect in of final half the to XXXX hand second in of the We

date. We XXXX in-service continue target to a

draft The major last Wind, key York the a our year published permit wind had largest and for for project. New Sunrise Public developments Service Commission offshore We late project project. received a two EIS BOEM

in of year billion up have costs in, last and equipment end approximately XX% of wind. as late XX% September the locked procuring progress invested of significant services $X.XX We had made and of from XX. offshore XXXX, As we

locked can related to The than one installation we for estimates projects. higher is those especially and nonwalking year slides higher see transportation On three cost, of have that fact in the a the that's of are had higher the costs, our ago. earlier. estimated This percentage due is some you our foundation, than we much to it and somewhat total the and updated appendix, of the in range cost narrower was

I should be energy to reemphasize, significant supplies source cost-effective that for consider clean of offshore the wind Northeast. we

electric much build investments expect to the offshore onshore regardless the be to closely infrastructure, region. is significant initiatives past year. connect of with will many our strategic a are over for seen utilities leading of in commitment Massachusetts to progress the we generation number clean FERC-regulated outcome the decarbonize, development helping the and energy of load, region we We our very Those of the transmission It needed have a catalyst our ways on our our review. aligned to be of one

to total that If proposals Utilities On first the unlock Massachusetts of currently approved Turning all six Department as solar connected. generation December be slide queue, the interconnection built eight. a to a distribution in of stalled six megawatts third-party is XX, ultimately result could capacity. approved, of inadequate of and proposals Public X,XXX transmission the and

slide As approved you are proposals, can proceedings other nine, on Commission is active year. deep on five the the Marion-Fairhaven. first them and for project new expect this see decisions we

solar $XXX hosting over million, would XX six be to years developers, fully in unlock by investment as about capacity. the which of $XXX these to would reimbursed they subscribe million proposed clusters, be approximately XX Our

X.X a Also in DPU AMI for our slide information approved our in new year, The nearly electric investment shown proposed as also Massachusetts. system million on late XX, DPU customer the continued grid the last customers with modernization. approved implementation of

system. resources electric investments their and distribution power heating into to will conditions customers our critical manage us more us these our space the flows provide connected enable is better are significantly on Today energy to system, for as be This as of distributed with transportation and and usage improved more and state's electrified. visibility will

customer over AMI its meter system installation hope regulators conclude the next primarily installed, XXXX to this review Connecticut of the and electric information in XXXX rollout with customers. X.X two time year be the will that their period. expect We to million new through approve state's We years,

DPU XX. electric Aside In December, in that plan other a infrastructure is have charging four-year profiled initiatives Massachusetts. from these projects, authorized slide on we the many vehicle for

other including time with supply last an our on outer serving and principal should occur we a to hour online distribution XX, facility Cape year to describe three year XX,XXX power, that this storage the slide On Cod XX-megawatt outage went up initiatives in on of Provincetown Cape. customers battery can

in The project which slide with construction network also provides now you designed XX% innovative Framingham, with the geothermal Massachusetts, status our of this start highly spring. is to

our and equity three have generation we proposals an communities. focus to justice Additionally, the storage into with on of Public Utilities additional Department expand solar

the climate its excited very help energy to Massachusetts region are of agenda our keep solutions achieve to very forefront aggressive as the they about of innovative change. We of proposals and these clean at challenges all

from energy Energy Environmental clean In with Connecticut programs there delivering our clean and the in Connecticut, Hampshire New clear Governor’s hope initiatives both to investment are and the that some that support. embrace looking Lamont involvement and of will Department these of federal signals promote energy are Administration in utility significant they in solutions. and Protection We

our grid energy frameworks not scale of forecast, Connecticut support storage clean investments. before investments, capital hope regulatory enabled that to enable projects such be and we battery legislation. in were To end, would have that are We pending recent three-grid current reliability this regulators will proposed improve which advanced resources. integration by state These workable

bills this to want in I Finally, supplies energy address power winter.

in winter impact New quite of the As as generation. well about supplies energy natural as you concerned know, England region's of and this gas, were higher prices uncertain entering we for oil LNG the

President his resources certain In sufficient Biden to before commenced fact, season heating measures that winter. wrote emergency administration we asking I invoked ensure have that this to the

has mild contributed the reduced have Fortunately, bills. started which impact this a reduction customers. prices, have sharp to the gas energy They bills to some natural for temperatures and on lower consumption in point to tempered gas customers' natural also

seeing Hampshire this a decline electric customers New are month. rate

electric start lower most be will For in in to reflected of supply our bills power costs July. customers,

the your again will I for over time. now John. to turn call Thanks

John Moreira

I and some regulatory Thank update regulated good long-term outlook This and proceedings. be everyone. morning Joe, five-year investment an covering plan and updated capital our our our XXXX give you, results, will guidance, XXXX earnings morning, on current you

our on with slide XX. start me XXXX Let results

per quarter for earnings share were XXXX the GAAP $X.XX of share with $X.XX GAAP fourth were Our in with per $X.XX share, XXXX. of In per per compared share, the compared $X.XX quarter XXXX. of GAAP in XXXX, earnings earnings fourth

and to primarily Eversource of transaction-related include agreement. and the XXXX Company year full costs, both included transition charges associated CL&P for Also, GAAP Gas results integration with of XXXX XXXX Massachusetts. settlement Results related

in charges, earned per share up nonrecurring XXXX. in those that Excluding X% we from $X.XX $X.XX XXXX, earned we

$X.XX the these share quarter, XXXX, per For with we earnings charges, share in of in fourth $X.XX per XXXX. earned excluding compared

transmission just our in for invested electric $X.XX system. our compared mostly with Higher XXXX, earned billion in XXXX, in the year our agent, with region. and equipment resulted transmission compared facility down the from continued of billion by To investment $X.XX in Current XXXX. break earnings over full share earnings segments, in for and $X.X share per an per We XXXX. improving $X.X -- transmission resiliency replace reliability earnings

property to costs. making are reflect share of $X.XX XXXX Fourth charges. also pay we customers settlement-related Our Connecticut the earned $XX by taxes electric in distribution results offset Higher quarter revenues winter. were seen O&M, pension and a bills this with significantly per XXXX, we in expense segment depreciation, partially our XXXX, help excluding higher interest compared higher lower have energy some the $X.XX share million per and contribution

billion billion O&M customers. did $X.XX was it distribution We per share, distribution XXXX, system improve in in service higher our expense from higher our invested driven in investments in ongoing storm in the system part, XXXX XXXX. more $X.XX our reliability stemmed and expense costs us to cost electric higher about distribution by in up in than The Non-deferred primarily storm for in about XXXX. $X.XX from XXXX. Our

share per compared distribution Our with natural per of in $X.XX earned gas in segment share $X.XX earnings XXXX. XXXX,

pension lower were resiliency continued O&M, distribution and it and higher gas investment safety, driven and our revenues of offset much of by partially property depreciation by to taxes, expense Higher the system. natural our reliability interest expense, improve

$X.XX Distribution System both segment and XXXX. XXXX Water share, earned in Our per

tax in Eversource charges, higher $X.XX a share $X.XX quarter transaction-related and the loss was Excluding largely XXXX second per income share companies in higher interest of lost the and to -- due with effective of our XXXX, and This XXXX. and compared other particularly parent transition expense, higher rate. change in per

for our covered with Joe remarks, we delivered are and XXXX overcame all in and as result, Overall, stakeholders. our as successfully challenges positive pleased performance, his many very customers we very our of

XXXX to XX. on I From will results, XXXX turn guidance, Slide

factors earned earnings in We compared and positively that are $X.XX $X.XX shows, we share, and with year between projecting share, non-GAAP impact XXXX. we XXXX. slide of compared expect per negatively the in The with this per $X.XX XXXX earnings to

expect our system our investment, ongoing drivers approximately, our a benefiting the benefit long-term where discuss earnings will upgrade again, moment, transmission customers when $X.X behind I capital our in electric principal invest how item we billion discuss will program to XXXX. is One plan. that it and in to I

We revenues systems. companies, Electric, rate higher are of last Those and November primarily and due EGMA XXXX higher continue that to beginning Gas, in project NSTAR, are also -- our we as to also just adjustments distribution we expand NSTAR effective at our were that went distribution on upgrade and PSNH at revenues month. X

property in they anticipated that by be expect We depreciation and increases will partially offset, taxes.

in facilities. value, XXXX. Those in recent we a and enhanced and have fund owned for We have several to that increased our energy various benefited years, significantly related include expect years, returns an in now in clean facilities results XXXX, have on in investment

Interest expense at continue will segments. also be a a headwind to our It parent. at headwind Eversource will distribution be

for of returns in that the is to transmission extremely pension earnings portion was we expense not is weigh allocated asset tailwind XXXX, an us expense While tracked, XXXX. interest due earnings. performed primarily distribution Lower in to strong on and the will the portion

to to In XXXX, be to $X.XX as -- for slight year pension approximately costs XXXX. X% we expect compared earnings of the headwind a

segment that rate or are fully in higher year discount to our Here modest pension of prior pension remains and into plan segments impact related this anticipate means a contributions are our why amortization first, our Electric is our cost and distribution capital of losses; funded actuarial the third, pension cost lastly, the of reduces our tracked; to discount some making we pension or -- benefit any the fully do transmission gas and reasons accumulated a XXXX. impact; portion higher natural Massachusetts and projects; expense capitalized secondly, significant pension not behind rate

to cover businesses plan in to distribution our I'm areas going address to billion From with turn to to certain approximately and in load states to XXXX slide service gas natural XX and service $XX.X territory of their meet help electric water regulated decarbonization goals. earnings expectation, invest ongoing our continue safe five-year and our our growth customers provide reliable and to

the projection and events. The increase equipment the underground due investment Much reliable replacement to our even in substations, is within primarily increased increased investment transmission electric, our make the transmission segments. capital cables. in older extreme focused in and distribution infrastructure continues This is weather of our investments more overhead of to transmission system during

Increased storm and resulted storm severe events. no hardening through in has related transmission outages several last resiliency system the

in filed are Massachusetts this early underground was new load site-in for also major an the the growth application years to continues of year project including accelerate. project to We substation Cambridge, about a ago. a build A where

and substation investments distributed mentioned earlier. and wind energy offshore transmission investment for physical the are our major million of Joe about $XXX We transmission additional incorporating significant of a in in security the total projects

AMI inclusion in energy cluster On our mentioned projects Massachusetts Joe the our and distribution side distributed hearings that first updated Massachusetts. the energy approved projects reflects completion and five. the in remaining proposed the these been also of of the are have Earlier for of ongoing the now forecast distributed electric that

forecast multi-year recent vehicle reflects electric our DPUs approval Our of grid and modernization charging also program. Massachusetts the

companies protection increased against harden our The years natural investment projects activities our low-pressure and several the of to We've flooding evolved natural have is to increased gas Merrimack side, number on construction also related regulations on systems. our around the Valley Moving added system since increased gas to ago. incident primarily that

Investment of Facility acquired Water of than nearly the completed our per investments. $X billion Eversource. investment XX% being program has Main Mains. year also approximately the updated Water annually XX Old reflecting the to the It Treatment additional its primarily the includes segment, forecast above than we million Water of Torrington of forecast, since that scope $XX Water five-year about replace the of addition Aquarion more more acquisition year previous Water, capital miles is In and by last doubled

XXXX, the investment been XXXX last with that totaled if with requirements XXXX we've likely in Moving which approximately earnings since is on consistent wind the is through impact having years levels slide billion. May, $X.X offset discussions increased ultimately the This year-by-year XX compares indicated to they of offshore our we when the would strategic that divesting our infrastructure in regulated our of investment investments, outcome investors review.

continue plan. remain investment to regulators our that major XX, Slide outside initiatives AMI shows review proposed Connecticut potential some program. our of

as So that $XXX storage in outside related investment projects some of potential of approximately Connecticut. plan, remains our million also are

megawatts Cod of City and could addition Cape another wind, Vineyard interconnect to on Wind. system offshore Wind XXXX Park transmission Our in

interconnections we reflected have are now such, New review, potential not the any amount under by ISO plan. As technical England, our in but

move projects to not also we've offshore as are clean now reflected addition, will likely, be beginning load natural that energy significant needed to We've alternatives of gas. generation potential to transmission explore we In alternatives, sources to wind reflected potential centers.

the XX, the through our As rate customer-focused in maintained have growth rate you in rate period the X.X% EPS on to forecast can a investments base Supported are XX. we forecast of will slide and as of slide illustrated result we solidly XXXX. X% core business included half X% our on see that believe, upper would those CAGR by through capital investments be in --

cash outflows our figure compared billion totaled addition, And not $X that our operations to slightly to in expect earnings we just from Last cash. under and internally over few In occur cash year generated XXXX do is growth, included a XXXX. we billion in are flows enhancing $X.X with the XXXX.

that than average higher to and the storm rate we contributions million customer bill made as XXXX more about agreement costs. of CL&P million of such related than pension settlement and $XX in the credits As $XX XXXX

enhancing combination industry. that rates metrics, progress Those ratings on strategic maintain credit the to strong review, provide of in improve of at current S&P, our the our allow the of customers to equity lowest by some issuance the and borrow us or, ratings. plans to will We in allowing benefits expect us case significant

to an our expect require NSTAR to decision. also levels equity the cost from increased company level We part Maintaining of parent infuse compared of into storm Electric us businesses. rate will those recovery regulated as our XXXX regularly

funding. the illustrates XX of sources that Slide

our debt addition In as -- cash to require previously additional will at I mentioned improving flows utilities. mentioned principally issuances we regulated

We billion coming at-the-market the years. equity additional expect over of issue to through our program $X nearly

continue will reinvestment fund shares use to to We incentive employee treasury dividend our programs. and

in our we on results investments, review use future the fund down flexibility to create segments. Should strategic regulated parent of financial a wind would we of offshore day pay one expect sale the net will our as all This debt. to our in increased proceeds

discussion Moving years, is we much reviews, discussion year, this In regulatory on various past the to few have a our briefer. that had update. regulatory lengthy about but

slide on can beginning you pending As continue all England see equity authorized transmission several XX, ruling return FERC's complaints on to for in that challenging owners. on await of XXXX, the we electric filed New were

a a compared increase equity. allowed in currently low We made are authorized Aquarion's reasonable its for water Connecticut, ongoing Aquarion at to as Aquarion's side, earlier, have only which return X.XX% the I below returns a Aquarion, review draft its due we have to On distribution rate peers. where rates, shortly. on the slipped strong case believe program the involves quite Due capital is decision mentioned

all of Elsewhere, gas and under electric three significant rate to from rate in In our plans XX we don't utilities extend five expect natural currently XXXX. operating Massachusetts, are long-term years. activity that review

we in consider they we XX, long-term earnings record slide targeted, decade, in the profile that determining risk over to see dividend our was company. should Finally, and we to as performance. slide whether can This invest remind consistently the track very since achieving attractive you that while shows our Eversource achieved investors have created, operating and continue on strong growth

also the profile us the best not, the in certainly which industry. ESG best, We have enhanced among ranks our if

over this the for us call you and Jeff. again to joining Thank now I will morning turn

Jeff Kotkin

I'm to Thank going sticking you, remind we'll questions in for back the and call you you audience how again turn and back she'll us enter it to Right. this turn and get queue to the going. to the Nadia morning. to thank then with John, me for

Nadia? So

Operator

hand you you. to Instructions] Jeff. over back I'll Thank [Operator

Jeff Kotkin

All right. Nadia. Thank you,

morning, morning So Durgesh. our from from Good Durgesh first this question is Evercore.

Durgesh Chopra

taking you review morning. morning, time good me Hey, last targeting originally, Good year-end expected. offshore review. sort completion giving year for this you strategic on of comment for of guys than certainly Thanks longer Maybe Jeff. morning. the right, the can were Joe, It's

what's you Any maybe So color that? could there? share driving

Joe Nolan

Yeah. Durgesh the and so you on thank being Good Yeah. for call. much morning,

am to of project. wanted that will So but eternal you a this optimist. year-end, due terms some other of I I that imagine, the Obviously, parts. place have complex got straightforward floor And the lot just is talking you it's thousands acres news this tell here. of It's of for looking I might about by as to you pieces in not of a take ocean at transaction people We're diligence has transaction. moving

timing. and more significant longer these in have I fair on took is realistic tell as I assets. But projects and a get to on it been the a as lease the here are the price interest for there So going well shame we you me, should will little

that these take the from taken think this the call you progress the eye I place away thing our on is projects taking should that But ball. have not that's one all off we

wind be will We business. the in

year, We scale large is the this will in in business end wind first pretty in extraordinary. by the which US wind the of be utility the a business offshore

The on other quite are two moving projects well.

those is know the pricing you projects As of favorable. quite

complex at to continue this I'd unfortunately, to focus significant we'll is want assets do that need diligence. to these buyer of drive -- to folks any process and at But go review need move to exit. doesn't this it going to that like but the pace that understand place, very go. on I this and to this good like you due So a and is

Durgesh Chopra

of of what or still of to quick the are with Is timing that follow-up. second we midyear, kind half to is is? potential a go update on that The forward then a thinking Understood. the sort if maybe review about And that QX this close? just do year, you decide due of sale

Joe Nolan

the Well, folks are you the sophisticated buyers. very right I'll that now in process that are tell involved

So in very quarter, would mean, I happen we due take would the happen taking diligence it at but would is the this close, do significant. not wouldn't a quick because the -- for. be it level anticipate second third it place latest of that's

So it get wouldn't like you and be being would have That's agreement that an all upfront. into done process. then

place we do year will -- So it this take is our anticipation.

Durgesh Chopra

Got it. the And then just I then I'll in one final can queue. one and if jump back

morning CAGR solidly So asked lot saying have base translates X.X%. growth now in investors the this to of how to is mean about your into And the up. you're EPS a half. X% growth your of guidance It's raise the X%, second CapEx rate. rate relative and that long-term I

Are Just conservative you a can being on you that? comment here? little

John Moreira

this Durgesh, is John. Yes.

we assumptions And our and very plan. that I be been will down. actual an and longer-term, in don't directionally and move to are the to tell think our over us So feds have the in we Obviously, can we've right. I further that have near you up those or what wildcard are materialize is by on the think conservative front, impact the in going results where term interest that if rates

now range of uncertainty things, going kind have pretty for -- the better year and year last land. recall we'll wide. midyear on revisit range that we right that but next is is And where did as we the will we view gave guidance to if will interest are rates what a And you

Durgesh Chopra

Thank That's helpful, so you much. really Appreciate the time John. guys.

John Moreira

you. Thank

Jeff Kotkin

Durgesh. Thanks,

is question from next Good morning, from Nick Suisse. Our Credit Nick.

Nick Campanella

my for good here. Hey, taking Thanks morning question everyone.

on XXXX quick real drivers. Just fiscal the

an said in you equity valuation. increase think expect I investment you

us that in item is what can that help how you And fiscal understand could is that? large the quantify benefit? just XXXX of Just you if terms

John Moreira

had take I'll years We've back. where minuses. sure. we've had multiple pluses and you Sure,

pluses the minuses. think the outweighed have I always

we a we've investment of second recall that the on and million resources mark-to-market had $XX in in renewable -- that very fair valuations So if recognized we We generation. quarter, on is this last primarily an attractive equity gas investment seeing are landfill that footprint. about year you

mark-to-market. have that get we we'll an So increase baked another assuming favorable

thought a past into card. We years, in it's had We've previously. was this had -- and we going but favorable, wild it's the have our that our the backed plan conviction it done where to over been the be these we guidance adjustments

Nick Campanella

Okay. plan, can the you outlook this Thanks of in then moving I and Moody's, their and just funding kind level negative guess -- kind you discuss front just the of have of here? that. Thanks. kind for just And confidence on put of off what's view

John Moreira

Nick. thing, Sure Yes. Sure.

So, and certainly meet credit of the three of I continuously post all with Moody's and that mean, we divestiture. agencies we win rating did announcement our

they appreciate our understand plans. So fully and

action both We on we with favorable annual Moody's a obviously, But take S&P through them meeting action. did go will wind if cycle. months I two be that some next you over – divestiture we think the as recall when and announced the offshore

what lockstep are planning they and we to So tune in do. with are

Nick Campanella

last side And one out for strategy. Okay. your distribution on in I the one on staying regulatory me know you've been just Connecticut.

kind of rate we think how the Thanks. Just be? would case about next do when

John Moreira

we a settlement have precludes distribution okay? it. X/X/XX, that know you no changes, earlier the now I think rate any right rate change far – we're not we're side, earning the from On base as agreement not than that allowed electric but

far XXXX. can I we stay as of think XXXX, the end out as

where our storm but kind is of rate that I case of recovery – will think costs. head trigger that that's at, So will

the see later storm So prudency year. costs start those filings to that review could of well very this you we want some

Nick Campanella

Thanks my questions. for taking

Jeff Kotkin

Thanks, Nick.

James Guggenheim. from is [ph] question Good from James. Next morning, Kennedy

Unidentified Analyst

guys. morning, good Thanks Hey, for the time.

So I guess just on wind sale. the

the cost the unlocked like you also bit in total balance then it of sales separate that the projects. could in You are still looks this And at Is costs. at there point? Where the seeing previously pressures? the a indicated And what's least that case? little be of there's the creep

Joe Nolan

the – that associated biased the higher be contracts. installation – We this do undeveloped did that interested be and in folks too foundation would the projects. We more we to feel than with had Yes. for transportation somebody are see areas costs and lease

XX but the As move these you larger for very, it very which it was foundation larger the might imagine, to helpful obviously turbines, also drove costs. you brought project when megawatts, basis

the was that So issue.

John Moreira

attention in we James, I'll your have direct the that. And to appendix. those numbers

Unidentified Analyst

And then you should should Perfect. the sizing the when it forecast that about the the – on the Just of Okay. through just we SKU incremental lumpy shape on about think there? how the in XXXX? the and Is guys outside transmission how spend, slides think of we the side? have

John Moreira

will – majority the the say would that vast happen majority now XXXX. of I between and

The That's is one spill XXXX. and That out that's over remarks the probably in us bit what probably a XXXX. that's Cambridge I those into the – through Some can mentioned longer. formal more takes substation. of only investments my longer-term

Unidentified Analyst

Okay. And then…

John Moreira

I go And – also sorry would then I'm ahead. mention

Unidentified Analyst

ahead. go you No

Sorry.

John Moreira

I two-thirds mention think important billion investments that approved incremental I that $X.X incremental of everyone by regulators. would been understand it's of has to that for also that that already

Unidentified Analyst

Yes.

the Okay. just leakage? the on update tax side, And sales efforts John, mitigate on to any

John Moreira

We but challenge to want given for it's look be continue a going to and us. transaction explore structured, opportunities how to the be we

Unidentified Analyst

guys. enough. Happy Day. Valentine Fair Thanks, Okay.

Joe Nolan

you. Thank

John Moreira

Thank you.

Jeff Kotkin

James. Thanks,

morning, question next from Angie. from Good is Angie Our Seaport.

Angie Storozynski

morning. Good

So talk wanted about to I just offshore wind.

books your sale the indicative somewhat reflected as of at just down you have your from expectation you Sunrise had, process it I was the what Ørsted of the XX-K write-down but or versus embedded in it is of different guys, for project. amount a the don't I'm saw a wondering didn't it see Ørsted. we at because what project? And you the I'm write is of assuming So

John Moreira

venture you when an will key this assure file let see the can Angie, kind with said, not me you I impairment it in you, John. But XX-K that our tomorrow. we is you GAAP of give Sure. Ørsted -- okay? impairment, different how joint that. is under and it's to accounting international GAAP, standards. of drivers is assess accounting. one, The Number an a calculation under as US different

So two that. two things that conditions -- prompted

As look Ørsted rates drove Joe of cost Those and the that mentioned anticipated XX% came to those finalized. Sunrise. two the a higher -- the where we fact than the for a in are. what at costs elements are That's bit being impairment interest take

discounted a to and the have assess is the you International the at future in Standards, rate. step first Under have cash inflows Accounting your assessment those to be

that and the that's payment charge. key really two look take the So used to at measures this

Angie Storozynski

Okay.

for delay then for wind about are on a waiting solar IRA it actually so clarity credits IRS assets. process, expect that's I'm a in the and mean the case wondering clarity if And when just from tax your in that the it is also the potential or maybe is from buyers we're those processes -- some sale -- would delay I you seeing And Okay. but credits? onshore on some

John Moreira

we and we to feel it IRA the clarity is the that guidance obviously soon. to speaking was that the we're will comfortable convey area from that beginning see year, right? issue think, to. on I with and So effective an they think coming soon this have it's we where Well, But procurement from have some the based we candidates

Angie Storozynski

Okay.

John Moreira

you don't out come regulations what know. don't those until But you know

Angie Storozynski

comments general regulators next probably the two in any a I understand. case rate see And you Connecticut of then are I push lots supervision there's utilities. years, not lastly hear mean that so think on likely related there about lots can been there how legislature And I and within but I electric proposed settlements over increased make for have the you and to you're those utilities. is bills to in points? some discussion

Joe Nolan

Yes.

So this morning, Angie. is Joe. Good

Angie Storozynski

morning Good

Joe Nolan

cover legislative year that all will So our this you'll time think, of come to business. of landscape see that the I begin the in proposals out jurisdictions

was is It settlements his was fact settlement. terms if in you think think much I the on governor the read the very there of that of the board. stories I matter

commissioners settlements three the consumer and the run with of Two some reps. of even

down see. So, I in transparent. different not we and will And than we've go terms maybe in so there. that of the actively there's place operations any yeah, involved different discussions. very Connecticut. There's that settlements been takes year what But folks it's operations up And knows think around really much in there utility are a up – philosophy our everybody don't

discuss So these the as the nine we'll first table of issues. a a it's inning have do and game, and just we seat inning always at

Angie Storozynski

you. Thank Great.

Jeff Kotkin

that. Thanks, Angie, appreciate

Next Gregg Gregg. from morning, Orrill question is UBS. from Good

Gregg Orrill

Good you. morning. Thank

around XXXX ATM? of around the to put plan. a Just range it the the financing Is possible use

John Moreira

saying marathon. What – we're right have – don't We a not sprint where to have not been and we it's issue. is, I've it's to along a

third we'll I $XX, the quarter of in that more price to and but everyone and to in performance. eye million is, Remind issue we plan average say at at a will an when of be do would said execute $XX. close be continue a we continue what keep did to last we as kind to So, year $XXX love opportunistic position have our to we to very on more. I that, stock

range would a want I'll to point. do really say. to need at or would you we this what I do, can't give to as So

Gregg Orrill

coming Thank you the Okay. Also, there on that Connecticut put to capital the give would into that ability is the plan? you. up anything AMI,

John Moreira

sensitive I in nice. have order and where supply – I I to An rates to in right? So, the would And for – be in be is, think we we to given mindful, direction see think July in X. starting we right of mentioned, energy be as the the are energy be it cycle new will are, very Connecticut have costs No, go as customers. just effect

PURA up would So closed. is think a that? be outcome. record everything could The reasonable take coincide I things basically tamper It But done. with is to seem that until to down

So decision a of it's a PURA. by just matter

Gregg Orrill

much. Thank very you

Jeff Kotkin

Gregg. Thanks,

from Glenrock. from Next Good morning, question Patterson is Paul Paul.

Paul Patterson

you you morning. doing? Good Just hear can me? wanted follow-up to How –

Joe Nolan

yeah. Yes,

Paul Patterson

Okay.

UK of saw as on proposal seems just So if you the was Connecticut give regarding some initial more a a could also couple PURA just in sort based a action A, to if that clarity PBR the wondering to; performance the as you proposal proceeding? regarding feeling that response take us proposal you will staff things. had And proceeding. There potentially I One was think And that up. concept you staff showing of elements when get when have? to have might any what we more regulation

John Moreira

this Paul John. is Yes,

little was right this still To honest be early proposal, you, think process. they that I quite did too in ambiguous. very now, which with it's issue a

concerns could we consequences mentioned what and right legislative the similar working it's share it's what have early. a some to But now in are bit direction. a with certain with them that process to them we So Joe the too be if go they

Paul Patterson

ROE we might eventually that? any to FERC you FERC have Okay. as get when And sense you actually more Do of on XXXX proceedings. mentioned something then the a from

John Moreira

I Paul, did. wish I

and I been there's think MISO decision what back. we're -- the remanded looking at

FERC, we but for think on other the and just I the is not decision really a on out So there that issue complaints it's jurisdictions. of decision going then fix before New see the should to FERC England that's the remainder methodology MISO and a

Paul Patterson

you've mentioned just regarding the offshore the Okay. that you stuff finally, And and had then optimism Joe review. wind

just if maybe like how XX/XX, at you maybe If place potential can in think you time? might kind this handicapping you're gambler this a to sense us a taking sale think as about give -- sort the thing, of, of is we point

Joe Nolan

I mean, the have the been players. feel folks that I very confident. Well, in folks very mix, that are doing due sophisticated the diligence,

Some of out in opportunities Americas. the them lost on have some

be So they the want in business. to

I appetite. think you've seen that that

that So I am and process. very, success very confident of process in the the

Paul Patterson

Thanks much guys. so Okay.

Joe Nolan

Paul. Thanks

Jeff Kotkin

Paul. Thanks

Next from question Citi. Levine from Ryan morning, Ryan. is Good

Ryan Levine

you process outcomes color latest plan to have questions thoughts? it here. you the do if financing your share wind around further? in you could the few smaller size, Good flexibility Any gets in What the your tools manage materialize. offshore doesn't have various and A sale morning. The delayed

John Moreira

if want it it your understand I gets if is to I sure just delayed? the Is make or not question transaction does happen, it.

Ryan Levine

asking I both. guess, I was

in happen gets do have all? or delayed, size if Just you broadly options smaller at it what it around doesn't it's

John Moreira

would issue we have more to debt. Well,

And Fork We benefits debt. investment project we -- doesn't we off later the committed South we So have our have -- the have transaction those been to to issuing We gate, by and $X.X happen, are billion also year. live right? our have tax going right? we first financing this

amount a would of be be would generated. that credits tax there sizable So

that So help commitment. finance that would certainly

Ryan Levine

on what of XXXX delta? to XXXX different what's drivers then are XXXX. between in the offshore there's Can that wind million CapEx the then cases. driving about variance the unpack like It $XXX looks in remaining delta And and of you

John Moreira

the Well, these the to we locked the projects. XX% foundation from that some into locked it's the related primarily finalized of some XX% directly for recent that's in that got and of us procurement

Ryan Levine

investments equity are percentage you Okay. you last embedding what in question. your for then outlook? increase earlier? disclosed that component gas landfill in And percentage you looking XXXX EPS of are What the what And markers your -- at

John Moreira

of not may opportunity, If to issue that now, a market On or again don't would we we that. less. I is we not to I'm right myself the But the say amount. that. going component may sizable marry equity, advantage issue But attractive it's once we of have significant a to and want more take

Ryan Levine

you. Thank Okay.

Jeff Kotkin

Ryan. Thanks

Paul. is question morning of Next Good Zimbardo Bank Paul from from America.

Paul Zimbardo

Thank me morning. good squeezing in. Hi, you for

income driver what historically the income And XXXX? was earnings for On side, quantify pension first the what expect could expense you or XXXX? you on in

John Moreira

was Well, difference -- you -- what of the XXXX part was XXXX formal versus an reasons for a income took. of and XXXX is to I result would remarks my I pension the with tell as honest impact the of $X.XX to that it about be lower you XXXX for headwind slightly

change. year-over-year negative modest a it's -- not So,

Paul Zimbardo

it Thank Could guidance? the a on CapEx. great. the know little old from incremental on bridge again guidance you new like Okay, mentioned of the blocks? you. involved you And building potential the I from a help I appreciate to bit kind the interest there replace offshore was XXXX in all rate up the with disclosures Because headwinds and but that more than sounded capital. you wind just step before

you on So, appreciated. could moving us just that the be would Thank you. if help pieces

John Moreira

incremental items three. would I two primarily CapEx incremental Sure. say it's maybe investments. or The

As have cost structure. you the rates, X.X% we slide CAGR on rate a our track we shown growth. managing where a we strong -- as And record of -- base show do interest for

manage So -- but for rates, to control. difficult interest and us it's

that impact rate And -- growth that. we our capital as it's materialize have rate. have I a be and items included will would on they in of an will growth that yet not combination So say long-term additive forecast

Paul Zimbardo

much. very you Thank Okay.

Jeff Kotkin

Paul. Thanks,

David Good Wolfe. from morning, is question Paz David. from Next

David Paz

Thanks for here. morning. Good letting me on

what your the several Just you quickly just guidance? rates the times assumptions. midpoint share of interest you have into in mentioned interest you rate baked XXXX Can

Joe Nolan

I would consensus say, aligned plan pulled we're with when together. was the pretty much

we assumption. baked right I our in consensus now mid-year have think that now and rate into has multiple changes

David Paz

over decline rise rates seeing the period? or interest flat five-year you or are And stay Okay.

Joe Nolan

mute David, hearing we’re while might echo… you answering, phone we're to want your

John Moreira

Okay. Thank you, David.

year. David, yes no, in So, off do you a -- bit here latter on… taper we the

David Paz

Thank you.

John Moreira

Thank you.

David Paz

Thank you. Okay.

Jeff Kotkin

you, Thank David. right. All

from is Good Travis morning, from Miller question Next Travis. Morningstar.

Travis Miller

now you're three two you're supply Is and comments there or what kind of look around Longer-term, that that Thank fundamentally everyone. the electric you. morning, Good operating change supply, cetera, if et gas years happening what gas dynamic? pricing to is capital anything rates, dynamic wondering costs, seeing rates. some could investment, right region you that out natural in either in doing of else

Joe Nolan

Yes. I mean, I good Travis. Joe, think -- is this morning

be renewable that think happening have online solar waiting Storage you'll see come a think a big of wind to resources we obviously push I going of what changer. lot amount that have we space just here I around think to we're is And a changer. storage. seeing as game game breakthroughs in and intermittent well. Between around a think that's I the that's is, yes, energy significant So, and you critical. I it's have When

quick confident I'm are New as But just as, that, fact costs will concerned. you enough feel the for this some, in So customers. up and mean, running I exciting opportunities, of do is precipice on our do get can't -- project far be York, will exciting. I the Unfortunately, supply I we down and by increase drive which that her year-end

some well. quite well, -- Even The obviously, those we're involved our project, progressing of other going competitor's because they're in are projects are interconnections.

far it see customers, but I'm of fast as happen as it enough our can't behalf again, on do I So, concerned.

Travis Miller

Sure.

Okay.

gas Just in or of, the exacerbate were a renewables, the improvement period? just Does comment. terms talking quick time like a peak load real of you influence situation, about

Joe Nolan

any additional the with improves think storage, some situation. the region, Well, I in coupled resources

planning, that around we -- around quite and us here successful some but gas. time very are We some we've It do gas quite the job region supply. in been good takes a

hurt introductions renewables not So, to the are of I think that and the it's them, help situation going it. in the increase

Travis Miller

operating as, one side? offset, be pluses O&M expect the one. just cost cost or adjustments got, in on you're something minuses. regulatory, seeing, quick that, then because real Great. drivers you other not And inflation the is your or to of that isn't Okay. rate you've and listed one inflation Is

Joe Nolan

Travis, Yes, so good point.

on and Gas, So earlier, as at have we it's absolutely spot have a and do we management I good of mentioned inflation inflation NSTAR cost very in record we're We on. NSTAR you're Massachusetts, focused but well. GDP that And adjustments and where are track seeing adjustment. that, on based the Electric as very

Travis Miller

much. Got Great. so I That’s it. Okay. had. Thanks all

Joe Nolan

you, Travis Thank

Jeff Kotkin

Thanks, Travis. that this And see that's we morning. the last question

to during want for you with us, thank of So, very bearing much we the call. beginning the

And I'm If just or send e-mail. to give call a us follow-ups, any you Nadia. have us it please to an going turn back

Operator

Thank much call. you. so This for Thank now today's you joining. concludes

disconnect now lines. You your may

Eversource Energy (ES) 14 Feb 232022 Q4 Earnings call transcript