XEL - Earnings call transcript Q3 2020

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Operator

Good day, and welcome to the Xcel Energy Third Quarter 2020 Earnings Conference Call. Today's conference is being recorded. Questions will only be taken from institutional investors. Reporters can contact media relations with inquiries, and individual investors and others can reach out to Investor Relations. At this time, I turn the conference over to Paul Johnson, Vice President of Investor Relations. sir. ahead, go Please

Paul Johnson

morning conference to call. Good third Energy's quarter earnings and you. Xcel welcome XXXX Thank

Operating Abel, Joining call and Financial and Bob Chief General Chief today Officer; Executive Brian me are Executive Officer; Frenzel, Ben and Amanda President Vice and Vice President Executive Fowke, Rome, Chairman Officer; Chief Van President and Counsel. business our and today's developments guidance in available and updated that we'll financial are provide our Slides quarter third website. review morning, our regulatory This results, recent plan. five-year share on XXXX accompany

metrics with of a release. are reminder, earnings, to call factors comments As to I'll are and today's comparable during GAAP the call over including cause filings items, our certain could natural contain margins. some differ included Significant SEC. discuss are the With Ben information. earnings Today, reconciliations in we Fowke. those anticipated release measures, that described make in we Information forward-looking from ongoing results gas non-GAAP may our that earnings measures that our on and electric the will turn and

Ben Fowke

the last thank quarter with and good morning for quarter booking XXXX, everyone. of Well, year. share earnings of you, $X.XX per share had per another compared $X.XX We Paul strong third

earnings mitigating on plan, the Our financial year-to-date are are track impact we and our with of COVID-XX.

$X.XX we As XXXX per $X.XX to to narrowing share. a range are result, guidance our

base investment updated rate year. over XXXX consistent base which tradition, the Now, our represents X.X% years. have XX.X base five This our of represents base off plan, quarter billion with our capital. capital next third reflects This provided growth of of expenditures we

returns $X.XX rate associated delivers We're would keeps excited incremental Minnesota CapEx addition, which provides proposal, and well share, growth also guidance X.X%. the In with and We're customer with drive EPS our of value, significant consistent our long-term bills very which, of XXXX investors. relief plan, for about if per initiating identified growth X% attractive of X.X to X% is recovery our potential to billion objectives. approved, base which we've $X

customers during of our including to employees continue also Mankato gain pandemic. sale the facility. help to stepped help our charitable We We and giving from our our communities donating up protect a this

slides. For details, our see more

relief Our capital been including outage create reliable approximately communities. utilities providing service. a a Nuclear recovery projects in our repowering at executed to have we're jumpstart this business the while filed includes that a wind XXX XXX energy that continuity of completing inviting In with safe megawatts, farms the investment facility capital September, And of plans potential year, create investment. opened which of well, Prairie million Minnesota keeping the restart jobs docket programs and we the extremely proposal submit through helping Xcel and will Commission jobs our our employees re-fueling economy to four for Island Earlier customer and economy.

the solar in our mid represents and projects. benefits the wind proposal In Project of plan the We're customer of PPA addition, We're million decision take transmission. requested commission megawatts of on the life XXX solar by assets. $XXX investment of portfolio the customer XXX proposing projected retiring year-end. of We've a coal XXXX see estimated The file near million. to the a the over decision of over proposal provide Sherco these includes anticipate will to advantage to megawatts is repowered an existing of savings commission our We extensions. facilities also in plant 'XX. proposal confident XX early

is is acquire the repowered. farm XX-megawatt progress Commission it We our request continue to August, a make wind after PPA. PPA buyout approved currently our Mower strategy. Minnesota on In the Mower to

to we Colorado. in facility the solar filed KEPCO buy out addition, In

the and small, the relatively the over money, the our $XX the million XX customers is While save investment years. is of buyout $XX will PPA million out

of I example is well our priority. this another bills keeping think

development our our operations, make completed We operation. on In ahead wind in budget. initiatives. to we it and load into record August coming progress XX% Ridge under XXX Since of megawatts wind strong from schedule set Cheyenne began continue with of Colorado. was wind a farm Cheyenne went generation hourly Ridge

also We million. Wisconsin facility acquire to an approximately reached solar agreement a $XXX for in XX-megawatt

their hydrogen DOE hydrogen use currently economical, the Lab we Xcel think electrolysis produce hydrogen and National achieve XXXX years will We its has partnering programs base in carbon be off expect peak efficient that and solar transport turn have of save enable free XXXX. a We're homes a commission allow to recently received electrification using use working investment. nuclear more grid. the it commission and of oxygen smartest EVs also the the developed high electric with our money subscription EV I'm to at its others in first We projects of transportation want few universal an vehicles. project separate our up a one water on utility we sustainable usage, I'm not plants. our with our while this I enable announce easier smartest and And our spent service to that recently and carbon EVs XX% program in XXXX. of scale a also of We declared couple that grant the for a X.X part reliability. last the to service save will electricity money. pilot process, customers to award long-term to way reality. announced $XX potential makes our reduce on to make customers this excess awarded stations rate charging territory hydrogen. recent and an million country vision which system Electrification efficient, with and installed decision We've rate by power will million the proud to Idaho EV that be goals, Fortnightly, monthly comments innovation customers as at for carbon for which charged from of the to our molecules which and territory our steam of vision later to is free electric Energy in help was excited while a into produce a dispatchable will temperature it's carbon can and maintaining and form more which wrap generation, be

clock results on as Winter So with just damages is more say Billy. the to before our And on customers widespread outlook, I I financial to outages. is Storm probably for the over the due wrestling do that know, you Hurricane Southwest and the Brian working turn southeast Beta, to its it detail want and restoring around

I'm a of Our of out adverse there in two there our customers have on focusing this team know so XXX customers the And hundreds out. and storm. conditions. I these thirds three proud thousands other in are ice days over past for our the I'm of that out that of just the industry. have as SPS Southwest parts been customers of are restored proud result of

We frankly, have events more a and never and history last year. of entire recovery mutual aid. quite these storm evident the It's two in

will So turn it Brian. to with over I that,

Brian Van Abel

expensive flat compared our per include primarily share, the driven the primarily good management tax by everyone. by the driven We and last quarter were More riders rate outcomes. earnings the increased rate share $X.XX for margins efforts. $X.XX quarter, lower cost increase share. earnings per And by effective O&M by per earnings share Higher and with year. significant XXXX had morning following. electric $X.XX quarter $X.XX of quarter Ben for booking per strong drivers the third Thanks, another for

As production a reminder, tax lower ETR. the credits

earnings largely and However, our $X.XX program. customers and PTGs drivers Offsetting interest through increased positive reduced are back flawed electric are were neutral. which earnings to by capital margin these expense, share, reflecting investment lower per depreciation

reduce items to combined per earnings addition, $X.XX other by In share.

to of our the Next, impacts COVID-XX discuss want mitigation in I status efforts.

weather-adjusted declined had impact COVID-XX as quarter sales X.X%. third adverse expected, As electric an by

we better electric are than assume annual guidance in for X% our impacts these projected assumptions, approximately decline will XXXX. sales Although, now

XX% in total we've for and and contingency adjusted As sales. the our small a and all have we electric sales weather favorable, projected plans electric reminder, which our than for about O&M covers drop has in the of in sales a classes Minnesota, classes better accordingly. electric retail coupling C&I come residential Colorado, non-demand have been Since mechanism

closely levels, certain which normal to a on in payment expense debt plans. We've debt also annual X% this guidance work now line year-to-date review. bad and million to sales Commission strong COVID-XX customers in for we pandemic progress O&M $XX compared X% initial of our O&M states, mitigate bad X% on the point, made with North previous on continue to our in on over expect approval impacts. expenses remains approximately expect remains expenses At forecasts. for decline monitor expense Dakota, received projections, We all we Based XXXX updated results with except to reducing and increase. will will request increase We related expenses our where

year Commission let me of of rate modification is both Texas, Next, equity Tungsten the our ALJs equity depreciation of BlackRock rate million, of an ROE that XX.X% of Colorado My when avoid preference the ratio Texas the XX.X% regulatory decision and case increase accepted reflects and million, quick rate ratio $XX electric a of October, recommended X.XX% AC/DC We the update. an settlement the regulatory without In cases for view for the natural adjustment reflecting an as of case of Commission $XX of approved the approve decisions net a and outcomes. test the our provide X.X%, plant. to historic ROE a In rate gas a purposes, acceleration constructive to rate possible. projects. Tolk settlement increase life coal an Colorado the

plan our riders July, XXXX grid recovery Colorado phases an regulatory path We're file cover a of and instead early Minnesota rate advanced November. In in XXXX of in we case comprehensive proceedings. is for provide we case. XXXX proposal the still filing the rate as the flexibility. in sale filed to in early of in filed to The and rider So through investments we will wildfire September, these alternative

decide rate whether as we're XXXX X%. earnings per objective X% to initiating range sale or which $X.XX accept share, noted commission to proceed our case. as And our of is to EPS of multi-year it December consistent will in guidance growth Ben the $X long-term the expect with We a

items here. based X%, guidance modest anticipate the want is impact which several several in growth COVID-XX. sales XXXX. We've are regulatory all seen of of outcomes a highlight project EPS on approximately these assumptions over release. in We our sales We proceedings. earnings which constructive reflects depressed I from detailed recovery levels electric in modest to XXXX Our COVID

of grid increase rate that a in find facility improve our to of detail includes combined are all significant new to by recover generally to to forecasts. O&Ms customer COVID by negative tax the fuel effective mechanisms initiative offset our earnings of to advanced about transmission of is wind our The mitigation. credited base in approximately base expenses jurisdictions wind to investment wind and to customers at five-year Sherco ensure expenditure regulatory our projects X%, additional earnings. increased renewable XXXX note Minnesota retire which and X%, reflect proposed lower XXXX. modest to largely billion in and levels health as reliability by including O&M approximately also and O&M forecasts reflects impact PTCs, expect investment natural driven cycle on reliability more levels plant the we our we costs We $XX.X due for and It material experience system maintain Please you'll savings. have no capital release, updated absolute plants which And the level enable renewable, finally, coal anticipate and an generation. gas grid increased In and have most

annual in base base. using X.X% approximately of rate results plan capital base a XXXX growth as Our

incremental the We of repowering as filing. X.X%. $XXX facility, which of for be Minnesota and the approval million are a CapEx will these also million have pending see base customer and potential recovery relief of growth the approved, wind for rate We're approximately confident Commission If $XXX solar benefits projects will Commission part projects.

think future. upside potential CapEx there's the we could addition, in In that other materialize

expenditures. of X% long-term of the upper in our to plan, our deliver Our dividend generation growth growth debt goal plan capital We've range. internal objective and supports updated of combination and fund EPS the our and financing majority the cash capital also issuances earnings investment a X% half are to which to reflects

In issue addition, DRIP $XXX equity $XXX of with and of million we benefits previous consistent and million equity our to forecasts. expected

metrics. XX% credit impacts. the credit incremental We investments, financing Importantly, will ratings with COVID-XX effectively our up. Minnesota on We're which by maintaining current our capital plan capital our will the access favorable creative solid allow the maintains capital, approved I'll And the debt. and mitigating that equity will financed XX% This Commission markets. be with fund anticipate and customers to equity us benefit that, incremental if wrap approximately to

our safety constructive We Texas case Colorado ensuring customers, provide our continue The to communities. of the service while and to rate reliable and Commissions employees settlements. and well-being approved

to jobs, Our in result per deliver relief X% significant will Minnesota range long-term We $X at and plans. our remarks. questions. This that objective. XXXX results and take help We strong, finally, And guidance earnings earnings customer value. capital updated robust per year-to-date within based now we narrowed customer to range. we remain significant a XXXX recovery prepared and contingency rate solid jubilate with on Operator program base long-term benefits. our $X.XX our $X.XX announced create We initiated economies proposal growth will and in provides concludes $X.XX growth consistent local transparent progress our objective to dividend confident to on guidance we X% investment can and share our share

Operator

Our comes Instructions] Julien Dumoulin-Smith of today [Operator of question from first America. Bank

Julien Dumoulin-Smith

Hey, morning, update on team. good Congratulations there. the

Ben Fowke

Thank you.

Julien Dumoulin-Smith

going I this get the process thought I'll on update. the 'XX you had I here on bit conceptually a talk here an on that little Can increase? a the mean, about you X% down year. keep

benefits the some So business it reversing? How industry about sustain this about you of saw guys out the the Obviously, in one of to first how impacts. 'XX to are to with you you back would year? reverse, you a thinking COVID the are give are but thinking the and there ability that

Ben Fowke

Hey, Julien. morning. Good

for into our grid along in to if a customer. year, XXXX, And with will So it in guidance COVID into this increase priorities, our up we to we if this prior and in down these X% look that expected you flat - was similar the land such But slightly year, remember wind investments and guidance see think year, range. our all next up then at we'll we about didn't frame it X% to now you but up. where maybe O&M going be as investing way strategic our roughly farms, significantly X, We're XXXX.

gives varies But how level. as a kind through transformation of driving article. absorb a it's our on bit kind that's - that priorities cost and you consolidated sense that we're of Obviously, little business, our of we and overall, of a So flat. gives by kind strategic remain

Julien Dumoulin-Smith

the you to disclosed even wind in of and that that Yeah, said prepared O&M aspect increase, remarks, clarify be the slightly, your would also well. to as

impact margins? right? they I when your net you So heard

Ben Fowke

Yes.

in terms So where it correct, recovered. yeah, is that's of

Julien Dumoulin-Smith

RPS there two Excellent I and in little help more but the to the you cetera. subsequent mind? a pending in out are prospects bit obviously, specifically Can at don't year. then things you're next respect And thinking of about legislation if as some figures, Minnesota, et are today, with here, around if reform, can frame that possibilities conceptually you

Ben Fowke

is RPS done. this reform Julien,

Julien Dumoulin-Smith

of - a suppose there's Sorry, energy variety as I legislation,

Ben Fowke

about. Brian talked

Julien Dumoulin-Smith

to Right, blank in well? pretty fill I mean, the I'll need you

Ben Fowke

mind. Yeah, out federal one well think and happens. mean, with the economics see well. in it we're have target, so obviously, proud we're target of that leading state level level I at liability Julien, obviously, to the I But interim an we the I mean, plays but for things XXXX, XX% the got is how think as remember, do I we'll positioned I whatever - by way, and a of we've XXX% very mean, I'm

think and with So the the senate positioned flips become Biden to as do level, along. it renewable. maybe well, federal to the bring a more probably both well that tends of aisle I we're if sides does administration, At

million with CEO chance would X.X and our accelerate be and for also that aggressive. the very the would both I Xcel that kind to ministration target. as know them welcome I Biden and EVs of XXXX help EI timeframe of is Chairman the probably will and let work they think technologies needed with utility of

XXXX. why reason a there's chose So we

state play shareholders out. the at very But crafting mean, Now for we've legislation think we it that can and well work demonstrated works I we'll alike. I customers level, just

Julien Dumoulin-Smith

time, it there, excellent, this Got I'll taking you leave thank all. it, well,

Ben Fowke

Julien. you, Thank

Our next Jeremy question JP comes of Morgan. Tonet from

Jeremy Tonet

good morning. Hi,

Ben Fowke

Good morning Jeremy.

Jeremy Tonet

it's on provide might point. be to this Just possible, see could application you early if your want at off, feedback any having recovery Minnesota you start planning that

Bob Frenzel

loved and the headline report and Jeremy, morning this Bob, Hey, question, reference. the it's thanks for the the on

On the Minnesota out R&R proposal. plan and broader the stay

We are working productively with all stakeholders.

with proposal, think stay working I and got the from department we're say and proactively advocates support the we've environmental so the would the R&R OAG their a and support. trying out to gain for I

would as last sale to six up rate take similar about to expect And case expect year, the We to in weeks. the alternative to the we eight our next week commission that proposal. mean follow

early And productive stay plan out goals So and proposal make to them call look and very decision. much December. timeframe. with in a we to and are in outcome Administration's mid-December it R&R a expect line Commission's the expect we'd the think We'd the the

Jeremy Tonet

Got reports it, Thanks there's the recently. just and switching happened M&A of for that. have very industry been then multiple potential here, transactions gears And that's helpful. in some

Just consideration wondering, M&A that of focus does any you there, to attractive or role organic front kind Great for the industry really plants yourself far just guys really your of is play you the consolidation and have have as of not attention in all keeps guys. in growth as Xcel big a that

Bob Frenzel

I we heard because that primarily great anything I not me - we're love on growth, long-term good we do we times Well, specific. but earnings the we I or tell trend I investors that. like to one you, have our organic just be you've look is and happening and the fill focus that. over And disciplined we book. I comment growth. think our speak obviously way. like question, in the of looking mean, But not And industry consolidation. to years like nothing things, It's don't by some organic it's won't sort mean a on will can something void see at what's don't the But It's

why of and So disciplined reasons peers. we're at a about the trade a very bit one to that's I of think it we our premium

Jeremy Tonet

helpful. Got it. That makes you. Thank sense. That's

Operator

comes of Evercore Our ISI. next Durgesh question from Chopra

Ben Fowke

morning. Good

Durgesh Chopra

taking morning Thanks question. for good Hey, my team.

timeline clarify be trying CapEx should incremental the on to for go just of I'm is of laid sort to what back approval and wanted kind gave that the milestones that of timeline that that us, you Just December the filing? you R&R or kind we see you get to watching out? for the

Bob Frenzel

sure, again. Yeah, so is Bob this

expect For would the or filing, on case mid we out December a stay decision rate provision.

also expect heard well. wind the in the our to would We component December as R&R of timeframe plan be

solar plan likely QX going XXXX the of more think piece I is be our timeframe. a to of

think but of and and normal the in transmission the areas vehicles makes there's around other we separate electric big buckets. the spend, some those I which bulk take up that dockets, up two distribution could are opportunity, in investment course

Durgesh Chopra

first get by helpful, year, right? year, to just that wind clarify right. next Super solar then Did this and so quarter I by the

Bob Frenzel

Correct.

second realistic. end is quarter, of sorry, more Second quarter probably

Durgesh Chopra

current future climate you? growth plan tax fit does how you. back but your going you sort Okay, just thoughts that speaking, to potential of changing a XXXX on your aggressive regime generally Biden the a in maybe rate around it comments implications think is understood, That's potential into plan? any for I then administration, thank it there targets, into maybe hear then And great. delve in we the change base is and rate CapEx Does

Ben Fowke

So to talk Brian I'm about the tax let going implications.

it's vehicle helpful before, it's EVs, headwind carbon as absolutely even off that think so think gallon, think would fuel, charge tax far tailwind, it'd As is $X.XX rates EV our create know I'm steel more I'll customers Biden costs EVs variable footprint we of if its similar The opportunities down And I comes to to sales program. that's if then don't and X.X which below The getting that obviously, helpful expensive we're load, of of renewable investment. for for your a it's turn for to that administration might today, electric for gasoline. for opportunities it's our million goal. in steel Brian, about come us the question. excited and heard accelerate a creating be additional speak investment I fuel. I I something there but out probably reducing type me down. you've a from. cost because equivalent particularly significantly think more while it of cost additional benefit are all over help EVs that an

Brian Van Abel

are still light, details on XX% think the rate increased you on bit couple from high XX%. if points, but a I'll whether and and to tax Yeah, a the hit of Biden little right, tax

went Just X% we of saw like the to savings TCJA, from XX customers where XX%, %to our X%. a

never to go we So onetime expect In do see positive think of way, a customer bills, impacts that the we to we it's TCJA while X.X%, saw precedent if the impact of our other see X%. through manageable. all customer we a did set regulatory proceedings terms saving. in our the timely jurisdictions refund the going that we or And in through of majority customers it's the

tax rate treatment We similar the if goes up. expect

On would increasing the credit on tax side, certainly credit metric rates the the metric side. help in

for in about on sense, XXX see metrics metrics. really XXX XXX a point AMT prior that probably points basis related basis is benefit the income, related that to be You'd back us AMT in know our an expect to to goes there I increase detrimental talk book the to would depends credit that XXX details. but But our to regime. credit if which to to

from components perspective. those tax the the big So two are

Ben Fowke

you. thank Brian, Excellent

Bob Frenzel

I Ben's a couple do - hey, a comments. Bob, bit about want it's to to talk just little Durgesh add-ons

amount very been reliability First on making will affordability next our of the and that expect the and EEI we a and dispatchable budgets and that sure our one on at generation, had. R&D a over enabled real to good, diminish opportunities the that for investment tailwinds, states but have focused for that a past of deliver to the new helpful. the R&D would customers, very substantial goals Federal other started company, and is see with which I and and foremost, generation areas with to federal for our and provide increase tailwinds in as secondly, other impact partnerships the four been side, And generation we've has states us have reduction, wildfires want has years the cyber don't of our today. vehicle carbon electric penetration are partnering around

can the the the well, I are there. important partnerships be Feds helpful, aligned of I state think very while So much really as we're think

Ben Fowke

And that's all is this I clean customer administration. any why transition just which happens driven, about of think type under energy

Durgesh Chopra

Super comments. helpful I the all guys, appreciate

one Just quick follow up for Brian, really.

Just rate Brian actual in using on help the your increases you using PTCs, doesn't for increase PTCs tax higher with kind of appetite PTCs?

Brian Van Abel

right. helps actually customers. absolutely just from you're from Yeah, LX also It the our

So you're right about that.

Durgesh Chopra

Thanks, guys. Thank perfect. appreciate the time. Okay, you. Much

Operator

Markets. comes question Capital from next BMO Thalacker James Our of

Ben Fowke

Morning. Good

James Thalacker

Good for morning, time the question, guys. And question. for thanks the

Just about guys, your understanding guess, and you updated spend you be XQ Right growth of Minnesota, is would sort But the modest even the like financing are probably have with now, of of the think the you But you solidly it at CapEx looking forecasts that until incremental of where midpoint. bulk that could thinking base in CapEx? successful the not within solution the rate looks 'XX. I at be sit you going upper that articulated, are and should end, translation kind solidly to that you I how forecasts the incremental rate. their guess, into at put you with guys fully

Ben Fowke

of we're would goal. quality, upper make end credit albeit that to the we'll X% million, sure X% Yeah, helpful additional be sensitive to to be is goal mean, at which I the really and X.X that important, strive to we

able we're So confident very growth we're to going our achieve rate. to be that long-term

James Thalacker

top is guess, Is rate? the side, being from prevent anything would growth the the end outside I you of an solar of adverse that on outcome, at there

Ben Fowke

mean COVID I I would things, there's Well, who in be thought we years always ago. mean, two

consider, - things things, there's to regulatory And a it of again, shape. outcomes things course, very So had happen. be could sales and could and we're but we've always like think good always lot I there's in that of that

James Thalacker

you sales, it the guess, point XXXX? component up looks about the thinking XXXX that following rates. for mix just little for of increase you're the bit on it a guess I And is like I in on to about Could a that retail assumption X% as Okay. talk

Brian Van Abel

Yeah. Sure and good morning, Jim.

kind we this be we residential break it to fairly year. Residential, it flat of for expect between So and C&I. down

are seeing about X% the consolidated across customer We good strong family. of growth

So it reduction in and we continue bit a I'll little a expect per the that customer. customer of growth use to call

I around C&I to the the side, to increase is is think C&I year, it, April in and see - we don't in what we expect C&I best the but to call about May you a think impacted. On we do that expecting, next happen X% expect And way sales. be sales know really to

parts So gives if April out kind of took worst and COVID sense you of year kind this May kind you of of thinking a is the of what we're year. for next

James Thalacker

color. that you much for very Thank

Ben Fowke

Thanks.

Operator

Stephen next of Stanley. Morgan question Our Byrd from comes

Stephen Byrd

Hey, good morning.

Ben Fowke

Stephen. Hey,

Stephen Byrd

covered And federal provided some commentary. been already. talk want then level was that just I about it's the you assume lot more EVs at didn't EV federal interest to for how EV credits, plans I be increased infrastructure, and might an infrastructure? of what in spending support there level terms spending? specific A interesting support tax let's is and of it financial Is helpful? direct giving most your form of curious, some would on accelerate support of

Ben Fowke

going an of just rebates of industry and the wide are think to it come part would overall think to down as naturally, I that introduced, models stimulate carbon that more down the obviously, purchases would do and helpful to would to consumer - but making be Well, buy goals they're I the EVs. cost more Stephen.

So of forms. I think their support in can a number come

charging than a sure of partnership that you'd people is think to likely public-private happen I would corridors for make a under Trump travel, - this addressing the more to things I say The other administration range maybe kind are all administration. around thing have be those stations a the Biden anxiety, who we fast

us. definitely get I be a and either asked that it way. I headwind, we could whether can I be would was comment, or think through So for a think tailwind to mean, our tailwind goal But I

Stephen Byrd

plans? guess you kind that building receive I specifically you is if of of sort see start on and adoption that just of could Or did we existing federal really support already to more helpful. you're work is where really ensure that then kind what just support, existing planning? moves more accelerate that ensure That's take your enough helpful to make the did to if or would sense that actually for your EV helpful to that to adoption, well there's plans

Ben Fowke

definitely are think confidence. million I cars XX% gives of is X.X more us the currently mean, that mean, goal on a it a road. I EV vision I it reflects and

So very helpful it'd there. I to be think getting

Stephen Byrd

thank all you, much, that's I Got have. you so

Ben Fowke

you. Thank

Operator

next Paul Our Mizuho. from comes Fremont of question

Ben Fowke

Paul. morning Good

Paul Fremont

Thank you you also my into XXX in very much. your numbers? first bucket spending the now talked about EV of Is spend moved incremental that base million initially spend. Hi. question of Basically, been is,

Brian Van Abel

base Paul, that Hey, is That correct. the is yeah, in numbers.

Paul Fremont

other of of my interest? spend then higher a of level XXX what's sort And million base at and a spend your question in is Wisconsin and PSCo the sort MSP driving MSP Minnesota decremental at

Brian Van Abel

enable term roll the some that is million Wisconsin we farm that need - about Colorado, significant for starting in projects in the have our we to to Wisconsin investments we transmission farm talked Wisconsin to advanced out in announced, do some some just transition with In transition the really grid initiatives. term Wisconsin. which it really articles have and had do that before solar material, big we're Colorado. I In investments Well, do transition. a And size we $XXX all our longer is generation we is longer also where have have solar think in we - we we part that

the for really big those are drivers those articles. So

Ben Fowke

would into in going - that lot service of which In in lot wind to is of mind, Minnesota. lead and that's a Minnesota, wind a keep there's

Paul Fremont

Minnesota so is actually Right, lower?

Brian Van Abel

big for Yeah, you XX so spend rolling from when this roll XX you're what Minnesota XX seeing. to win the you're is XX in forward year, or to

Paul Fremont

it, of in adjust actually some wind would have that so another is year? Got place that taken when

Ben Fowke

projects The included been in have 'XX.

Brian Van Abel

on in go Yeah, service.

overall Minnesota. like for in tell value of the plan, CapEx think incremental that's significant spend Minnesota increase and you the Minnesota customer developed if then all So the that proved would we right, to will R&R,

Paul Fremont

Thank you, that's it.

Ben Fowke

you. Thank

Operator

Kim Insoo from Goldman is of Our Sachs. next question

Ben Fowke

Good morning.

Insoo Kim

morning. Good

one is coal some is think for precedent momentum, me, think And of to retire and retirement there plants securitization you all correct legislation for plan? plants. a I accelerate getting Minnesota the Sherco like depreciation if further from I'm X any, there do state if the in plants? - type for question me value potential the remaining to game the coal I How what frame of wrong, coal that the of accelerated of or

Bob Frenzel

early, we Sherco Bob, to morning. units appreciation depreciated plants you projected accelerating the it's 'XX they're Insoo, retirement are XXXX have We've retire two by approval X on X got and and Hey, in and fully this and accelerated we good respectively. that being to that's - with date their hear

ours. go workforces, legacy We've these in mitigating through Sherco taxes been we with resource early process. And we the planning to plants have stakeholders property we in proposals, jurisdictions. Minnesota and retire heard offered of depreciation. care accelerated very also our part think taken in year, As as of with of those plan, the the X successful likely sometime plants the working King transition the and XXXX, the we We've resource next of and our

continue so we and overall think And is this to in we'd and of expect the that package part fashion. successful the past, just in been that we've

Ben Fowke

we Colorado. The only have securitization is in place

of don't we As have now it.

Insoo Kim

in talking were these on just that the King, accelerated effectively. I understand understood. about Right, potential timeline? momentum earliest XXXX but plants about what the any Is and And branches and no, depreciation considering the should XXXX given securitization that we asking that, X Sherco state, two for for was the I the just proposals the dates be for

Ben Fowke

that and It us runway through Yeah, plan. to resource community the issues. manage a those gives think we've propose look, a I employee our in to approach proactive taken

And our now. proposal so that's right

Insoo Kim

very you Thank it. Got much.

Operator

next question The today of Sophie is Karp from KeyBanc.

Ben Fowke

Good morning.

Sophie Karp

good of would broadly, proposed energy from to into a level would have incremental in project the you morning. could taking federal tying your was policy what discuss wondering portfolio accelerate maybe storage. maybe you. Thank place kind that going more Hi, if your outcome, there? potential my adoption be storage Thank question. is helpful forward? energy you And Missing I And election for from what

Ben Fowke

Colorado, that's in take planning going much. place only resource we so storage batteries us and for of on I can kind and I a not it's - fear, you're all do Thanks mean, the think great a I to Yeah, see and proposals, I storage. will Minnesota our It's think emphasis for in both mean, that. see do question. role our

Minnesota, plan But you that needed. So think just at technologies part peaking we - out, with those some to perhaps Colorado. can XX% in plan yeah, Minnesota The look saving wind true say get of definitely customers when form long-term storage projects. the will resources when the peaking R&R too, resources. that by address last hold are we to about in needed that just thinking talked Well, batteries repowering about we of will be would we're that actually to seasonal money same we're I going of is his what variations. did need

that the And world. given the sense the made we're in so to conditions in us, and economic all

Sophie Karp

other of it, you Got pumped other any early too older storage, manner? effectively you addresses you so it in select hydrogen, just maybe cost-effective to that so storage to relations right have now? can deployed can are Or technology, any is types considering of kind say a than that be even rely on

Ben Fowke

with in what hydrogen I definitely Cabin plant. is all pumped but do one it I things. those. can our is storage, perhaps that the storage table. storage ways, the different looking We're Yes There No. on mean, is of Colorado. Pumped used to storage think we can Creek is of in at be long-term

are the as And through go those a on we the yeah, resource out that little planning you'll I things flushed I So table. think, process. see bit mean, some all get, of

Sophie Karp

thank right, you. All

Ben Fowke

Thank you.

Operator

next of from Levine The question comes Citi. Ryan

Ryan Levine

morning. Good

a you couple rate PPA can comment influence higher decisions? could PPA regarding that tax So could development the announced any so of how opportunity updates buyout or it If buyout around around - pace program, the like election? you looks change into federal

Brian Van Abel

maybe impact development more that Yeah, the significant corporate was things Sure. more if dollar though you their again, deliver time we pretty see and wind very terms of the customer these from benefits right If significant spend and IPPs which filed certainly the the could Good perspective. amount, it's million benefits, good lot extended, to team to discussions something a small than and an provides want that tax that even a extension corporate farms. that capital Minnesota could customer about in approved kind it's see talk repowering PTCs, we we just in in of Ryan. you a rate buyouts Yeah, that a couple get election is view to from announced are Colorado morning, IPPs solar business buyout how of PTCs change we with A opportunities, watch, conversations do opportunities. in with. right, of if in

because it the finding we sweet I is in and spot opportunity, that this So point with. continue price and we long-term that just we'll really speak for in something is about this deliver value conversations kind of significant customer terms well. something ensuring is continue works have as quite at actually about of the a look finding to that to that conversations us

Ryan Levine

with last development of few any activity conversations the been in relatively recent commercial you're there counterparties. been months in having around efforts Have acceleration routable is those it or the

Brian Van Abel

during it's COVID impaction bid savings. our number to so bid couldn't see challenges. There certainly our kind to to get can had reach to some say there, was that if as that a Minnesota close the we of with - of picked was up would getting we'll an we conversations was those in. relatively deliver were continue win routable, agreement to and recovery and some that counterparty we and actually significant negotiate that customer into provides We buyout RFP, relief of developers PPA the that That PPA customers but wanted the RFP savings

the our to for us for important it's said, customers. I savings deliver like So

Ryan Levine

Thank it. you. Appreciate

Operator

Miller from Morningstar. question of next Our Travis is

Ben Fowke

Good Travis. morning,

Travis Miller

stuff you. about election a any the you're state so level that? I on races follow up want talk regulatory or to at Good looking level policies the at you day, a that level that regulatory for are issues election the wondering at What election level there, Thank like state at conversation. and as the morning. key are local or looking

Ben Fowke

an currently be like reduction which the think aisle able but been Senate, what we've mean, it DFL looking taxes wise, be across is I bold were I and we've we'll And do R&R energy Minnesota Democrat, do about. some we relationships and these plan think really and and job democratic I legislation, go have plans. whether that talked the probably administration on all looking good done Well, you actually not branches in I has appreciated increased at we just a our again, would think if the or corporate what executing carbon for things maybe Republican, of aggressive at to the is pretty developing to communities and and

type So say I'm kind not you I legislation come Amanda, of Bob of and particularly so focused out might comment. an on or that transformative to any that election. want

Bob Frenzel

Travis, this Yeah. Bob. is

there is with. think would we of And on proactively versus think I New well I a appointed good we initiative watch got commission, only ballot in Mexico other the elected engage thing would working history we've to commissioners. and obviously the new any

Amanda Rome

is obviously Amanda. we're boulder watching one the is municipalization. other This vote closely only on The

Travis Miller

own own the then stations? might helpful. as charging on your to them party? late expand might that's owns great. assets? thoughts for to you. inclined speculation who and who thoughts assets economics and the which charging pipe, discussion, and your the third own follow-up easy Just Thank role you of base, as rate like lot and have very speak terms of around your What whole Or is And are wondering how that inclined being merchant another chargers? so that they the that? to pseudo them And a talking No, right of the Okay, about to around you are in how

Ben Fowke

you Yeah. fast Travis? charging about talking Are

Travis Miller

way probably Either not residential the in customer. or whatever home - and

Ben Fowke

well to charging things multi positioned residential dwelling, the own stations. like very or those on side, think Yeah, I we're that,

to I'm and allow you fact to had EV, if it get as a easy really plans it's you not you easy for you would - home because In you we think as sometimes. excited make EV about an wanted try that our

into you money. it you off to you build home at us, our rate, significant no can for encourages a amount installed saves cost to subscription of it so call with charger just charge get And and we the peak a

don't peak. off well think can for we've it's owner, And as - customers, math; KWH like it So EV And importantly, it's really minimizes think I the a the equivalence, month. because impact $XX the other grid. the have the to you done and use to just compare out but all works you it's we it

they're They're I think Now, make address you when about but of no charging kind it. stations, really fast to lost. range necessary get bones like anxiety, to

don't So I play. We're I we into think just that partnership to come private that's like where role done. play happy to it see to; But a public have a there. could

like So answered that kind question. I guess would your of be I

see it. I think where that's we

Travis Miller

Sure.

and great appreciate Okay, I it.

Ben Fowke

Thank you.

Operator

Patterson The next question Associates. comes Glenrock from of Paul

Ben Fowke

Good morning, Paul.

Paul Patterson

sort the to Good private clarify about? morning. thing, me thinking missing you what of help entities quick partnership, sort just How just would you're exactly doing? I'm of to out So entities? the And the private a public this, the Just here, - what's or really EV on be? be briefly just that entity who public would that

Ben Fowke

of state I the could down charging those have to mean, of different wide open on supporting stations. either funding would buy mean, is take get of me provide label built. cost it. forms. infrastructure, necessarily a these to The I provide to the you, to doesn't we have Xcel government, it, I an Paul, could part be could we're Well, federal just It mean, energy it tell to can just that. the necessary I key we lot or stations I or think

the is So space that anxiety. and range purchasing barriers one - people biggest an of EV

think, I more need, charging to again, easy leaders amount which built, of are lost stations, you so have you so right And be that penetration. fast the

different kind of and chicken can or a forms. the it type thing a lot of egg it's take So

Paul Patterson

I cost I'm you just you socializing strategy base Okay. into just And wondering, customers. about wondering, speak option? a feel an having to mean, put Or do simple that guys just I basically was that and over is what a - so rate is

Ben Fowke

it's we'd mean customers? as want been to But sure this things to the to how you our that as going them, if is much to followed. How yes. and with socialize? okay, as me process show long that. short is the long mean they're it's and yes, leads I okay easy answer - the want one more make transparent. I subsidies As heard incentives how of penetration, that And benefit I've always things like about much does all of you've exactly, And talk we're is

process. is in think upset Because that not really isn't - transparent seeding of something being we'd sometimes. socialized I gets real mean, a hidden, role what socialized. it would charging people that's important I play a what amount you not a that. be people were being just for, not But socialization, everybody is when that kind selective word where say and So we what stations. I think of want the perhaps could happen don't sure And really I and advocating with is But would these

Bob Frenzel

and happen, control making peak valuable charging. grid very in that really to are but around in two loads we sure investments spaces, don't discuss are certainly there Bob. it's making can that excellent benefit the we and and that have and opportunity peak than charging, appropriate of we areas interstates We And communities where whether around that more get I have sure Hi, public I think behind, investment, town think critical. electric our that that is that customers impacts areas the electric equitable important. the and think of make incentives role also the I it's sure our an to making where grid charging sure we on there's will we sure bouncing are all the for areas or involved, stations a neighborhood, And where distribution public from Paul, that sure that second making the want there really is the area optimizing provide. in ownership world off peak on and is in we're we're of make those left on that vehicles can some Recognizing vehicles

owner believe well. good be those So that would or very of stations we partner leads you a to that as types of

Paul Patterson

if to you do elected, of ball it's crystal guess but think is, wonder significant you about mean, sort or Republican corporations, feel it fraught, to mean, to then the trying Congress trying were that Senate really you got when sense on plan, there of kind realize issue a would tax - just I'm like, don't I one And I the general? higher question what Biden corporate Biden, I have and it okay mean, in be kind just I for and a in in there? likely? assume how do at a the that taxes - Awesome, on he difference guys get thinking and of everything taxes this would strong plan know Democratic is and there pretty we're people if flavor sense I that's was what you're on Senate that I look how you do any or and that this a just it probably I and raise in to is of a Congress, sort do want when make

Ben Fowke

you of things I Well, don't to if if plan. interest compromise tremendous wrapped implementing think tax full I to it's Senate. sweep hold it's sort Biden amount Congress I and form implement Paul. do tax a to and the I the there's be don't to going - might around some think other going Republicans you're of Senate Biden But the the sports have of need think I think think, plan -

Paul Patterson

really a Democratic - have we maybe, Senate, if But it's know, I yes.

Ben Fowke

the if taken need are Senate of I then Democratic I Senate those running look candidates you would on be moderate over a you think platform. at and Democrats, many think by how

how - to is. would So big be have I the sweep you'd also it think depend on

Paul Patterson

enough. fair you. Thank Okay,

Ben Fowke

X, we point. Stay It'll tuned, but at way, will we November know should so know some Not be sure. sometimes. the by

Paul Patterson

Yeah. I can't wait.

Thanks Okay. much. so

Ben Fowke

you. thank Okay,

Operator

As for hand or Brian call additional CFO there any are other Van would remarks. like the to back no Mr. to closing I questions, Abel,

Brian Van Abel

you Yeah, this calls thank morning. all earnings in our for participating

you please follow Investor our have Paul Johnson contact If you Relations in up everyone. any questions, team. Thank

Ben Fowke

day. good a Have you. Thank

Operator

that today's for Ladies your call. concludes and participation. gentlemen, conference you Thank

disconnect. now may You

Xcel Energy (XEL) 29 Oct 202020 Q3 Earnings call transcript