XEL - Earnings call transcript Q3 2021

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Operator

Good day everyone. Welcome to Xcel Energy's Third Quarter 2021 Earnings Conference Call. Today's conference is being recorded. [Operator Instructions]. At this time, I would like to turn the conference over to Paul Johnson, Vice President, Treasurer and Investor Relations. sir. ahead go Please

Paul Johnson

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

that are President Chief Bob Officer; today others. and me Joining results, on Frenzel, morning, and a and Abel, provide and financing Rome, XXXX Vice few business accompany call regulatory available share Slides are Vice today's will General website. Amanda Counsel; we our Brian developments, and and our Executive plan, XXXX recent review President Officer; update and Financial capital guidance. our This Executive President Van Executive Chief

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

Robert Frenzel

you, additional reported results, expenditures of community tradition, delivers capital guidance solid per customers and updated of base our projected potential our everybody. Colorado X% opportunities $X.XX compared reflects And third our Today, off investment are This narrowing last not and given growth to our in plan, vitality. provides the to past rate year-to-date transmission of XXXX does $XX integrate Colorado assets $X.XX plan rate renewable include LDC investment Paul significant share. but also could per we're production our decade. capital This plan with years, balance including share, plan robust, initiating $X.XX which also needs, believe billion our we've the included to authorized XXXX any renewable Colorado additions resource which XXXX we objective. base $X.XX X% the our next which we our proposal. growth with Minnesota generation base. guidance new hydrogen base base year. to supports that in material long-term beyond Consistent our or there capital the benefits EPS not of over for earnings are reflecting five base investment over generation per generation certain share strong that's or in X.X% $X.XX morning green to quarter and We're needed to Thank The year-end per power $X.XX of proceedings is share pathway good plan, plan be for of a

at clean we believe future. Island keeping supports the with favorable to production plans investment by hydrogen hydrogen have resource pilot we're tax can state XXXX, are generation and as the XX,XXX to or as going Colorado inflation. and which strategy XX% those that We organic customer We're in have well enhances that for brownfield next our add Minnesota Together, renewables including provides investors. energy greenfield rate the system below pilots resiliency, our five very our enable credit, conditions reduction achieve resources. at needed bills eight favorable clean projects. our our decade, for help be continued into our Prairie and hydrogen growth a and for potential and a our renewable green plan, exploring communities, our long-term customer renewable It federal of fuel transmission an and production the Minnesota And of plans in well Colorado, to for to our in a megawatts bills will returns nuclear resource reliability transition, of to fleet passed local over our while additions valuable clean and backdrops nearly attractive and about execution and sustainability plant, advances leadership. carbon-free legislation delivers and keeps beyond of which us excited positioned energy I'm sustainable carbon push resources proposed low, additional

Minnesota year. on resource the need first the the substantial plans expect energy We Colorado to quarter is clean of The and transmission going investment. in decisions both also transition next

state, continue expect vital We the To-date, X,XXX market minor deliver integration resource essential first we first progress has comments to delays, good pathway be explore enable as time. decision over In It in Colorado further year. the we in us in the which half to megawatts energy power new Colorado the project, renewables expect for plan. to XXXX. announced parties our will make is the of and the it's transmission over western of most in from Midwest, next still generally of but we quarter commission and MISO some supportive, been have MTEPXX on experienced

strong quarter. had a operational We also

their fleet Our nuclear days refueling industry-leading to two having set run with consecutive another prior units over outages. XXX record,

Bighorn economy. we've the quarter XXX-megawatt this facility largest on-site steel with its This mill creative a and carbon emissions highlight solution In valuable continued creates country X,XXX the Pueblo, state property employees. solar serving and array that helps a multiple the between enabled really base EVRAZ is parties local operation local ensure the the dedication of expansion of and the solar the leaders, customer. was BP steel mill in Another and partnership Colorado. It at sustain the Lightsource in single to tax and reduces

partner the with continue transportation OEMs and sector. states to to our electrify also We

We five-year states that well-positioned our to so with reduce across work in federal capital remain dependent quarter, bills a sound strategy, keeping implemented not sustainable growth We plan, returns robust while our carbon communities. a emissions sustainable with These to investors, by new electric enable our low as customers plans to programs attractive and that for customers. on trajectory for and XXXX. us achieve This enabling stakeholders long-term are we help collectively policy. provides collaboration many of will the our vehicles goal we million appreciate Colorado our X.X changes

solar agreement tax Biden reconciliation an the and hydrogen reached credits, tax investment pay production and customer a that a plans of for significant our and credit on by has credit, investment administration and for resource potentially framework credits which creates a production for it's our a This clean the credits. tax package, include extensions would our tax However, storage benefits plan proposed accelerating proposed direct transition. and cost tax transmission lowering options all energy a understanding

and our projects our production benefit Our in customers. program make the steel credit even to demonstrated Proposed providing renewables. solar advantages for has ITCs tax including additional for credit, expenses future fuel will competitive, tax more PTCs, geographic

corporate in reduce which our our could financing into could costs. customers. and pay credit A hydrogen metrics, our technology would would cash would and begin Additionally, incorporating greater that's a PTC provide operations time the which and more option significant flexibility, help direct flow It into green economic bring hydrogen needs. and for advancement value financial increased power cost we a frame gas natural for generation accelerate at distribution also

that that, level to bill, our will over passed significant While are on will at I'll optimistic final Brian. the plan this discussions and be turn customers. continue federal to we With it the have benefits

Brian Van Abel

$X.XX the third year. include quarter share by On increased We Thanks, compared by Bob, morning, $X.XX primarily with are effective per most margins per last last everyone. the significant and a per ahead and to by following; our share. $X.XX $X.XX Lower $X.XX natural share investments. regulatory riders year. earnings per earnings capital share earnings and had share quarter, increased recover a of electric gas drivers $X.XX driven solid recording addition, for The rate basis, per O&M year-to-date good earnings increased higher share. tax And lower per expenses in outcomes by our earnings the

production As a tax the credits ETR. reminder, lowered

to large earnings share, program. depreciation Offsetting by investment positive expense, earnings items through electric $X.XX by year which $X.XX reduced wind other per by were to share our AFUDC due farms increased to service lower and drivers However, decreased and combined earnings largely last PTCs are $X.XX per several are into flowed Lower back largely per share. reflecting reduce placing these customers capital neutral. margin earnings

sales electric X.X%. our to sales Turning increased by third while quarter, sales. the Weather-adjusted year-to-date in X.X% electric increased

results to year-to-date O&M declined continued Given X.X% year approximately X% X.X% updating increase a full sales approximately the the for growth rebound noisy to we're economic basis. states, but expenses. in weather-adjusted with year-to-date COVID X.X% O&M year. year, Quarterly expenses expenses electric Shifting X%. comparisons our and our our the from O&M on are impacts expense and to last our for the increased overall, quarter we expect to

Texas in case rate Turning and to potential reached settlement. a strong regulatory, progress comprehensive we on making are settlement Colorado,

include: electric the we Colorado Dakota proposes cases. rate As October, all will Key we reached settlement Energy months through deferred fully the and several months Mexico was we cost Please fuel $XXX and a comprehensive to estimate in last Uri that a XX our North Uri Colorado quarter resolve a over constructive regulatory proceedings. New charges terms note, staff customers, Wisconsin, in recover reached reminder, carrying LDC from In the office natural XX Colorado with the to million. settlements Storm gas Storm over rider. with costs revised for Winter no for

to of during replacement expense. extended $XX of million of million not seek customers the debt COVID-XX million electric of deferred refund outage will approximately previously And XXXX bad will We approximately $XX an forgo revenue recovery $XX Comanche power We'll to incurred of due recovery costs program. we decoupling XXXX. associated with three approximately deferred

settlement, comprehensive take represents We of were from Uri we and which recovery. parties cost to all to this the compromises the reach steps are pleased mitigate the customer impact that able

first commission a of expect half We decision in XXXX. the

rate discussions In in pending we Texas progress our settlement terms making case. of are cases, in

and we'll be agreement. schedule the reach abated, has able As to we a that a hearing result, are been settlement hopeful ultimately

electric new of a rates with decision in Colorado We effective year April. March expect case next in our on

of seeking an is we're filed XX% increase ROE Minnesota driven in electric rates to a of of case $XXX As on The requested XX.X% increase implemented of test in case XX.X% XX.X% in is forecast we equity year. million a a based million net The and interim rate years. investment. based of of capital ratio $XXX ROE ratio XXXX. the In the equity rate October, requested reminder, filing XXXX forecast be We million January a over three and by $XXX on test net seeking largely of years. approximately

of to November going early plan interim rate into gas a case Minnesota in file we January with Finally, effect in XXXX. rates

look we Uri a of We to as recovery option help also stay-out file impacts customers. cost to bill for mitigate our plan

we Bob detailed have which billion release. $XX capital robust earnings in issued our As X-year forecast, is mentioned, a

reliability of capital Our growth results power other approximately in forecast Colorado and base our system investments grid asset reflects pathway plan as Sherco level a plan and in X.X% reliability modest investment renewables the includes base base plants proposal our enable including investments customer XXXX also maintain retire a health as peaking of transmission using rate ensure plants, to we The renewable significant two It and generation. reflects gas experience. improve The base. facility. proposed to coal to natural with along solar

forecast, associated Beyond we incremental capital anticipate the Minnesota our potential and with plans. for investment renewables Colorado capital resource base

Our investment of proposed capital megawatts plans XXXX approximately result would $X.X to XX% billion, billion XXXX, which X,XXX incremental assuming resource ownership. renewable include additions $X.X in of from to

addition, related incremental need transmission we billion of could fund our generation financing which issuances the We've incremental a anticipate Colorado debt for the support and to see our the to five-year updated to this majority in of the for to billion latter $X of clean million of $X.X combination reflects investment we In of energy also $XXX $X.X expenditures. part transition billion a cash Combined, the forecast. capital potential internal plan, IRP.

which to maintaining and million and maintains the customers. $XXX plan current million for equity next of capital strong years. important of credit DRIP for and over a expect our is issue metrics benefits financing low sheet, of cost The We equity balance $XXX five our

solid with likely while over would customers accretive through equity incremental five anticipate expect capital favorable and that XX% to capital We equity maintaining the will equity benefit investments, We ATM XX% to financed ratings will credit would markets. any our and be us our capital approximately the the allow years. incremental an debt. access fund This issued which be

detailed consistent reduced is Key our are to our significantly long-term passed be with earnings, of could to growth our reconciliation are with needs the per share, we if equity the $X.XX X% $X.XX Shifting assumptions EPS X%. current to guidance earnings objective framework. package is our release. earnings However, which of in range XXXX initiating

settlement regulatory XXXX the that, of our in updated to represents X.X% a per base our In base addition, XXXX $X.XX With with revised midpoint quick the growth several This comprehensive which between proceedings. we've resolved represents that I'll share, We the a range. in Colorado wrap-up rate summary. and of guidance reached XXXX. growth

finally, program We value. to guidance provides share. XXXX long-term We to case. $X.XX And of can low of prepared base half announced we with capital objective investment are objective. strong, our upper will making the progress the This robust XXXX customers. towards $X.XX earnings the initiated range updated Texas bills concludes rate continue to we transition We for long-term questions. and We a deliver our per settlement we growth X% within our energy range growth customer as take rate our remain confident guidance now our we remarks. keeping transparent our narrowed growth consistent dividend leading and and earnings Operator, X% that clean

Operator

JPMorgan. Jeremy Instructions] question [Operator first we'll you. Thank go Tonet with from And take our Please ahead.

Jeremy Tonet

Hi, good morning.

Robert Frenzel

Hey Jeremy

Brian Van Abel

morning Good Jeremy.

Jeremy Tonet

residential C&I drove start relative to the quarter? classes see did would there? off the think trending respective into be just I load residential your Just these into how to on trying how you load. heading expectations the I customers What Thanks. side, particularly perform And if could. XXXX, with of types growth retained to want

Brian Van Abel

call think it's been the Yes, And we last call to of back we I has expected this but the, residential some it, give been so that sticky. into stickier gains forecasted residential year, year. going saw than it, the,

X.X%. you year-to-date look at up basis, If a is residential

think at lot drivers our I been. of where Colorado, that So, one big guidance a updated that's Colorado And in if of the for is look -- you that year. the was has of

permits service We building significantly customer side are the residential growth territories. strong also up. see Residential all across of permits on our or

think I seeing C&I across But really opcos. really, side, in all the levels. rebound we're we SPS. some coming a directly happening substations on the at is what's lot Permian good -- our C&I pre-pandemic XX% Basin those loads, up and in And -- focus customers to load that it's and in with On our relative We sectors even is oil gas that look serve back.

at hearing ESG good And is also, feeling drill. And us. pumps, compressors, our they're for rigs, customers electrification. disciplined, are certainly so we're electrifying that on pressure and focus those growth big looking -- to continue but They're a drill load

we're I of next continue that will the strength year. think our and pleasantly So, confident into it surprised sales with

Jeremy Tonet

of of for next what year, have work partial And back? new you? kind you from residential of Got as it. kind on kind just do as expect give home, hit have a a we more normal Or far

Brian Van Abel

expect I a think back. we slow give

term there return to an that be about as I'll be and you amount there'll think I you think of stickiness example. give work, long will our

We for back I part-time to a have work work. do to from little will a be but this for think it stickiness a start bit. on year telecommuting and a And time, home policy we'll last come that our to so year I basis. from employees long down see when they able come they'll think

Jeremy Tonet

guess, say frame pivot, are, thoughts wondering coming to a lot it's Certainly, first want out helpful. the current that Got wave I through it the you good be MTEP the expected, might expectations of it, that's of just Mexico, far of really there there. for come as and your what the announced. what of for I investments Could MISO's just could But volume release, project your there. Northern potential projects process. of the start/completion as of timing you able to see then to early And the Delaware a New you activity, bit

Robert Frenzel

been the for highlight for Bob. expected. it's over probably a continue Midwest. expansion My We modest. the will Jeremy, next transmission XXXX analysis reasonable MTEPXX Hey expect MTEPs the are slower I maybe series that number output do the upper expectations agree we years of and in need of of that to the has than

XXXX in and XXXX. I think we'll more see

permitting line like tail a actual time get the probably the very to going file probably of construction. then to projects. while five-year It's think half construction through you through to and more in for this get the is It's the take back but these a for at of plan, things decade I while once going take to proceeding. that, and the

XX So, five-year in really that. but the outside of our five years probably forecast, after to

Jeremy Tonet

Got it.

last Just could. I one, one if

of you it opportunity XXXX? take to more do develop defined line do process to Could time? fully incremental as here the Or sight in expect IRP expect the the CapEx, be continues? For how you

Brian Van Abel

QX I QX should approved a Call from we Yes, up. and shape with those good and for in amount through go growth two next really we be We'll it next of my we substantial plans renewable by here resource -- year commissions QX I of some next be year XXXX the opportunity a good expect clarity. their to Phase expect have of in real to in now, as on it our back Colorado in a Minnesota year, remarks. processes of pretty year, Xs and of Phase through and both outcomes. to and each prepared the clarity having highlighted expect jurisdictions,

Robert Frenzel

Phase two is PPA and BOTs determine to proposal ownership. how And for clarification, much the versus for is request

Jeremy Tonet

helpful. very it That’s for Thanks. me. That’s

Robert Frenzel

you. Thank

Operator

And Kim we'll Sachs. question with Please Goldman go next ahead. from Insoo take our

Insoo Kim

question, Minnesota first process. do Colorado the is Uri there? and we think I the recovery that there of you a missed are cost if is Where apologies settlement similar My you in constructive process? potential on And for you. on Thank for side, a to it, got what that things side

Brian Van Abel

Yes.

this Brian. So, is Insoo,

months, the terms recovery in Minnesota, has the over of amounts. review. a in some of disputed So, subject prudency commission XX There approved Uri to cost is

disputed of you $XX million If costs Commerce disputed $XX OAG million costs. the of our about our Department about remember, the of and

to that commission decision work and year. mid-next see December through a expect then we'll proceeding. We'd late So, intervenor testimony

reach the of feel filed we've policies. working feel commission-approved we to prudently and through we constructive outcome. And commission about Now, and hedging process acted a like expect the good

Insoo Kim

Bob. bit maybe a And question little for a longer term, it. second Got just

But you think are a their retirement and well, is and coal that in to generation have for perspective think to how putting filed utilities whatnot. helper could robust plan, regulatory that out the possible, in jurisdictions, acceleration from late you you know other line items further as for do are acceleration? and much place? the have and what financial reliability been You're seeing time from maybe period in that the do the just and needed plans that acceleration IRPs lot call Colorado a I even XXXX opportunity transformation And in of -- other Minnesota support are place. and given that current your XXXXs XXXXs further have frameworks

Robert Frenzel

communities Midwest great look, of single almost And the approved -- this country. And a close decade, plant on out Upper have in last be We'll next of over a to decade, a and the decade. the year Yes, leader question. the coal our across we've to coal systems that's We're been we we've a job close employees transitioning great program. expect, decade. in this transitions to by coal that plant of the part plants plans end of the every the as the of plans over and we majority which done coal

long assets property of the businesses care Our supported making to those base. tax the that do we and bring to for economic back decades. communities, communities been and that a philosophy take development Insoo, those us has runways, sure have We chance get

credits window, long this on areas we've might think a behind, proposal a But XX-year the been that company, resource the much as reconciliation to going I part for we So, production are potentially plans with works. bill, runway to have can. I very got in think we And bit best that a see for transition. accelerate these you're the with the the are manage to going table of tax are

years. resource we about and file these so every plans, through three And we to expect work

think the fleet So, at to come about bite so on another transitions. we'd the remaining in apple assets those XXXX, our have

think that the core, were though, we of we'd to I first need the XXXX. company next identify announce carbon-free to generation by at We generation. be

what bill of and generation. I development. triples infrastructure funding research DOE think I for is think another type we And emissions-free need the

we the to the I expect think reduction XX% to that's XX%, which an industry of decade. past by critical is end about for where the be, carbon progress

Insoo Kim

That much. Thank you makes so sense.

Operator

Julien we'll with Dumoulin-Smith And of Please America. ahead. go next take from Bank our question

Julien Dumoulin-Smith

Hey on a time. Thanks morning team. reconciliation good just Perhaps for the pickup the

Robert Frenzel

Julien. Hey

Julien Dumoulin-Smith

on morning. Hey I wanted just to on Maybe good reconciliation a point. follow-up this. pickup the

here? Could you more enviable are for about the your about here the for how various you comes little here, PTCs of PTC. on bit it when in bit. on I potential the expanded a Just specifically like forms depending opportunities position talking emerge thinking on I various leveraging there? an know some mean, combinations I that mean, been particularly a elaborate seems could to we've repowering repowering might it expanding be

Robert Frenzel

opportunity Yes. Look, repowering We've been in years. us. for for is a wind great leaders XX

some lot their assets that got already. got a on we've dates, PTC we've past and our have wind moved So, system of

approved We think in clarity would of as wind but part a have this to repower again, four that of repowerings for long underway R&R Minnesota. time I which and bill plan the already here provide those that lot owned And were lacks a assets. who've definition people

this So, legacy the and could would but repowering, for think I we the what side up haven't pretty assets be substantial. on opportunity delved into open on our details our

Brian Van Abel

Yes. this think -- Brian. is you I if And Julien,

You heard before. me talk

repowered ones PPA them them. the bought and you the have side at been where out on look been particularly as If who have buyout strategy successful we wind our

or and got it from credit customer a XX-year of show you solar I up a it extend just even that PTCs, of new that the So, PPA buyout wind term, term, We're perspective. reconciliation benefit extension long-term open springs. think make think right? opportunity of PTCs, work a this longer PTCs runway make financial extension opportunity customers that opportunistic, for longer solar in I the longer-term and kind and a But obviously work for package that's to a

Julien Dumoulin-Smith

in Got of at you and then here, in the elsewhere. you beyond we that really the elaborate subject seeing reconciliation on could looking know staying risk a at are angles What reconciliation potential in the move anything of else closely talked bit terms ago, all else about front can you mean of I all needle particularly PTC that perhaps I I specifically of us? maybe scrutinizing here? transmission bill that you there mean, are little it, excellent. And is for

Robert Frenzel

mentioned lot I our understanding government of side. bill of proposals lot But towards And see real lack hydrogen, infrastructure of $XXX Yes. a think I billion Look, lacks clarity. customer so we the credit, as in opportunity and in our were the storage potential remarks, significant obviously line, a that resource in the I the the from decades our prepared bill with for in goal or the potential with nuclear as even clarity putting we've talking tax the and side transmission opportunities next for a production Minnesota on you're plan. development, about plants run through applied

definition, So, that's then the more really the on of of through opportunities a we're as lot course honestly, be we'll have more we insight going are bills, out some bill next clarity of couple the there. clarity to stuff without lack into working the text. and the months, We but on get

Julien Dumoulin-Smith

you potentially like on to that, front, nuclear But on into appreciate remarks. I clarify could framed just -- prepared regulated sounds it sounds No, it's here how exactly the tap like your for Yes. assets. it your depending that

Robert Frenzel

That's correct, yes.

Julien Dumoulin-Smith

Thank I'll hear. very to Well, guys good All Excellent, much. it right. pass on. you

Robert Frenzel

Julien. Thanks

Operator

And ahead. Fleishman Research. Wolfe with we'll Please next Steve from our go question take

Steve Fleishman

morning. good Hey

that more? Could I be that just explain your equity said in you lower your reconciliation think, So, if passes. needs you Brian, remarks could

Brian Van Abel

Yes absolutely, reduced that passes. current I be significantly Steve. framework if the could said

our see opportunity cash points tax and of down, But improved passed. billion significantly could the it, Now it's still we equity call $X.X it, of to see inefficiency call reduces, in cut that of you The have light flow. details you provides right? probably, a gets direct little plan, what pay terms XX and basis on XXX in

financing what us at of perspective. needs. can we equity And do we those to a lot look gives opportunity reduce and from so It a that

excited look that pretty extension do about what and good we're our that long-term really credit So, And at tax the for from customers. can we plan, overall customers.

Steve Fleishman

corporate And of also on don't there are larger Okay. they've it sorry, same a other this renewables provision tax to And if you. but the good, be like issues early, which like companies credits that, yours. then excluded of added I XX% think I related the it's is -- minimum for looks I topic. know from but I know is know that might --

you could but bit be and whether about bonus went a away I on talk pressure? the think to And just how that that about that thoughts could So, provision? with Trump think a little changes, issue

Brian Van Abel

Yes.

regime, and we through we yesterday new think a in for really spent And -- last very assessing the legislative terms that. -- looking the it's and tax it's of it's, us, So, manageable so with how way qualified it's comfortable and the AMT -- the than we alternative we through book is But overall, that minimum feel work a tax, manage old existed. it. different it can

And us. when as view we package, look at it the we for overall so very positive

details So, I continue regime and said, -- new it. it's out, to our but again, like a will come but that's initial on read

Steve Fleishman

rate big Last Colorado. you have two cases, Minnesota, obviously level, question, the helpful. just that's very high Great,

filings. success You've in are things that. Uri while be different rate and one guess like just upward are Those There's there of is now. might pressures. are the thing for rising I lot lot and a a that costs of regulatory rate fuel a had today decent-sized

does about talk this that you this time? could different Just make

Robert Frenzel

Bob Steve, thanks for question. and it's the

strategy key tenets for One of of the our our is affordability customers.

largely will of planning always drive to over approved the ways We continued that bills are will resource renewables how capital long-term, These cases customer for drive offered case hear mitigate capital under work the transitions impacts the You in And cases of some we've deferred a mitigate this to investment haven't the at -- years, we plans. particular. over And Minnesota side, relatively for case. impacts. in customer we lower. six in had ways least have

the and the feel in capital clean our in O&M ultimately pandemic to investing watching drive a expenses recovered. get transition, and cases we we've will need up deferred been judicious remember, like If in ultimately end plans you to that but investment throughout that very energy trying continue

We interim So, rates. our offered mitigation that think the are increases plans, manageable. we've bill on

think down bill impacts. be very total so under for customers, manageable I the proposal, we'd think $X.XX month I a in at about residential

for megawatts per steel about at think -- margin. that by customers if fuel but adding hedge. has work the areas $XXX other And over on, those year in gas gas we of and We that Midwest the outset, addition million hard on we natural having so talked program we a success we Upper saved instead the the you natural our this blowing procuring about of our wind provided wind of improve, think

necessarily successful but with So, over years bills a program, uptick show steel in for pricing. gas last and fuel which the this mitigated natural doesn't very it's certainly up,

Steve Fleishman

Great. Thank so you much.

Operator

question next from we'll ahead. our And go take Chopra ISI. Durgesh Please with Evercore

Durgesh Chopra

my Thank morning. taking you for good question. Hey

Robert Frenzel

morning. Good

Durgesh Chopra

I guess, elaborate had. prices? Obviously, of on Maybe natural discussions a little investors made all the gas ton a answered, the on that last You've had front. you've I with point you about just bit questions

your on customer share So can that they perhaps us? gas are placed, your bills, with anything you how hedges, assets impact

Brian Van Abel

Yes.

So, this really wind the year-to-date And to at Bob's a had on own been around investments have it providing reductions. we year. our our $XXX impact customers cost what fuel farms, point basis would really we those been was significant not have higher million wind -- if had look a would

what So Bob's point that's really is.

on kind think the when our customers. And about higher how is think it I around impact of commodity these side. electric broader the question costs we potentially

NSP through sales those into at side. we natural provided and this quite to had already we're strategy, this in portion made bills is you right, back really of help over the Bob come customer something commodity positioned, our the look some a that strategy. But sell market. overall of electric also I costs. can credit we've our we've we length. wind light about well and look, higher customers have is year in And And also market on and $XXX million small for SPS, we offset the but steel think clearly, right? the And fuel point gas relatively doesn't our that

So, I electric think the and our a on we're really don't see impact side customers. well-positioned significant on

customers' On the the there, that of have the physical are do given LDC into less our higher we certainly, right, going -- you But costs commodity storage. side, there's bill. can -- on the winter, portion a

We products. financial have

the on for it winter. about residential And for think for is an at customer when $XX for our look -- average impact, the example, take we're I so impact bill think we this -- I forecast per month Colorado

it's help every think customer can we impacts. bill look we for manageable, opportunity we but these to mitigate So, obviously

Durgesh Chopra

Did month, right? per dollar $XX. The Thanks. you X-X

Brian Van Abel

X-X. X-X, yes, not

Durgesh Chopra

Yes.

So what percentage-wise? be would that

Brian Van Abel

over XX% winter in the the about months. It's --

Durgesh Chopra

it. Got Thank much. so you

Operator

with And Karp Please we'll go ahead. our from Sophie question next take KeyBanc.

Sophie Karp

and morning a Maybe taking items, of you question. my may. housekeeping if thank couple good I Hi, for

You And guys what shape for on might in terms are financing we showing in some equity of as? form needs plan expect Can what and should come timing? us you those in color give your some XXXX.

Brian Van Abel

benefits think program. -- of through $XXX about we reinvestment Yes, I show get dividend equity our we million

an the So, million, piece, then we likely we program, just that's and an do say it at-the-market $XXX -- through ATM. that's other through

have We we needs. timeframe flexibility that capital as look over our at five-year

Robert Frenzel

kind for assuming you -- -- that something government you modeling be pay significantly if could a purpose, you're the that again, -- if could could Sophie, potentially be the by want year of through direct assuming ratable end. assume approved program reduced by that

Sophie Karp

growth should And we how growth appreciate and right? going what scenario? uncertainties this higher, how out But lag and of with base corresponding regulatory just it. the this the in numbers? can so to prepared now, roll Got about Washington with and of kind then we is here rate the takes like are those with you do. talk think will CapEx you do if there's going think And puts lots you think the about not to And when guys general, I new earnings in about forecast? should this that And is overall,

Brian Van Abel

new about pretty plan. we're excited I think Yes. No, capital our

type could of it transmission X%, plan or in we call the right, -- kind five-year into plan. customers. And rate that capital, of renewables push look as lot system capital And for basis, rate our our this, multiyear drives a growth our X.X% out north -- that, we the it's we the it it's think benefit some that. plans, could base afford built could of X.X% off will you of then to it recovered depending if I renewables XXXX or on at riders us be that about incremental it, resource based transmission if a lot on of of And Bob that on through executed and if need mentioned, of our Colorado. come for potential a

address regulatory the plan overall capital the it. comfortable in to we're So, recovery and have place plans kind with of of

Robert Frenzel

year. if slides rate And growth Sophie, do base you detailed look we by at the

to see So, want check you can you that, out. that if

Sophie Karp

Thank I And Colorado. on may, it. Got you. lastly, if

the pretty case it to the a fuel rate So, is the or settlement on the say? too good you about think guess potentially there with on I Should we settlement outcome there early cost recovery. in door opening that have the

Robert Frenzel

that fourth could on proceedings the the resource then put more the conversation, the points mean I hitting case and also And four of certainly you're mentioned, think for as pathway us of key electric we to the longer power quarter conversations. Sophie. in the of us I be so one settlement we in term settlement. of in get strategic The rate could are Colorado plan part as and ripe behind Well, front you there. right

get can a in wanted the I think is we've and Colorado, issues. strategic bit got what more constructive and yes, it says reach to pathways we So, the we underbrush clear to settlement to bigger outcomes,

Sophie Karp

Thank appreciate I'll the queue. back jump you. into the comments. I

Operator

our take Travis with we'll Morningstar. ahead. go Miller next go Please And question ahead. Please from

Travis Miller

you. Thank morning. Good

Robert Frenzel

Hey Travis.

Brian Van Abel

Travis. Hey

Travis Miller

of bit. to the and affordability wanted I kind little a build customer rate-making on

keeping the all bucket we proposals look you another around allowed operating being out If seeing being kind you of where have that pushback the regulatory CapEx, terms most of across bill bucket rate-making buckets recovery, such of customer and in capital, you another components cost put and cost there, or on of the are that? those affordable ROE holistically

Brian Van Abel

don't rate case, So, -- of I I right? think the dispute that's it, us. think been, I unique to in an that ROE has think area call always

of That's pretty at determining that that's appropriate across other one is. the think they utilities. the what I ROE look levers big in common

from where years we been we past feel have the that that good pretty Now, few below average. national over stand, ROEs authorized been have our the

think clean states when we lead ROE right, as the we're leading know closer we of national there, the getting upside and think potential their about we to average, more risk policy our goals. So, energy with transition, helping

there's side. there the I for an opportunity think us ROE on So,

Now, for O&M think about our story. pretty I proud we're us,

the at where an Now, if you go perspective. basically way flat look today, O&M are and back from XXXX we're we to all

customers that you if our number, -- saved several we've apply the hundred just X% inflation that we avoided annually. millions and maybe growth saved So, of dollars in

a So, I story. think I have think -- clean really overall, we

cases Our are system. needs primarily capital-driven, investing of in the the

obviously, overall look the if cases number. filed six just the forward I comes a great But and it have working with product on parties and a our to years, hadn't rate delivering we through really working headline So, you -- sometimes think commissions case and in you big in lumpy these a end.

Robert Frenzel

Hey Travis, Bob. it's

coal at to time, deliver component a customer the premise over mitigant both favorable mitigate And cost more got country. have as to we significantly business. you I to what commodity both which bills making sort favorable on all with. and talk completely increases, value and what they to we've that, for regime one natural on our that's or for said, a in mentioned add investments mitigate We've volatility. Just of a I But for real And regime been our being in that of really to of beneficial we've their on gas classes. fuel total renewables can the they're whether the down deliver where that side. provide sit we drive want this got bills And own -- helped is fuel lot Brian terms of more able agree customer provides such by than industrial stability and predictability thing our residential a earlier, our customers, steel able and when renewables of that's

Travis Miller

had appreciate my I really questions. it other great. answered you all Okay, and

Operator

Please question Associates. Patterson go we'll And from with take our Glenrock next Paul ahead.

Paul Patterson

Hey, good morning.

Robert Frenzel

Hey Paul.

Brian Van Abel

Good morning.

Paul Patterson

on, and that it's just and that question have a it's The I Jeremy. guess around X% high Just on -- you. I realize shifting really sales growth been quick level, clarification what

Of of Not projection new run in classes the of had forward is would sales But Do a that you rate from of so you course, see now just new COVID. at XXXX, number? between normal say XXXX, we've customers, X% a being in my understanding, going just think what as much et cetera. kind your that's that you general growth? sort just of terms

Brian Van Abel

I think it XXXX. be looking might beyond

still think little the COVID. from starting of a bit of I XXXX, we're to rebound still see a depths

So, that's X% longer on don't know between X% probably X%, if and a full five-year forecast. a I

electrification. when opportunities. electric getting right, that's the opportunities, there's think we're that give I from beneficial I'll I vehicles. number. And upside of hedge -- upside into just There's discussion

X% lot this think I longer you're a So, XXXX. side. of on front in electric after opportunities the probably to X, for there's X% talking But term, the I think sales

Paul Patterson

new no And has over want so don't then been change change of inflation, that's been your it Okay, last a to about But we quarter, since talked great. that terms unless any I or go again. it? in has in change outlook, there there any about thoughts it in

Brian Van Abel

pressures. no I'm mean we our read from with sure QX we longer all term. inflationary commentary as the I in you real the but near-term changes it think No, as same about But headlines do

Paul Patterson

Got you. you. Thank

Operator

Ashar from our Khan with take next question we'll Verition. And Please go ahead.

Ashar Khan

passes accurate? I of that response you Hi, needs can of billion have payout eliminate question $X.X correctly that your reconciliation you Steve's the said morning. that direct you reconcile. the if in Is bill to and to plan. in want good I If this heard most provision, that just equity

Brian Van Abel

could we equity said needs. significantly I reduce No, our

Ashar Khan

Significantly.

is significantly XX%? Okay, more than

Brian Van Abel

to we and I think significantly -- the have details a right? significantly. is And see we are this really plan, details of light. framework, the It's do

the it, back. we get nuts So, once through and we'll bolts of all come

passed, Assuming it with are details it gets back come we the that gets which it. full we'll optimistic passed, on

Ashar Khan

Okay, okay.

reasonable significantly to would be a rate have one assumption, we if -- leading happens then that imply higher growth that that then the but because other? hopefully, Is a less dilution. should So, that

Brian Van Abel

are takes. and There puts some

see base growth bit depending could a it. little on the rate You lower of details

and the as we're customers company. takes, where So, us about I for there's both our reconciliation puts overall, think for stands, but positive and a package

Ashar Khan

As -- okay, as shareholders.

Okay. Thank you.

Operator

closing appears like any I'd at to conference this additional time. Van CFO, the are questions. further Brian for Abel remarks. there to no or turn It

Brian Van Abel

Yes, for this all thank our earnings any you in morning. questions, contact With Investor call participating please Relations our team.

Operator

call. participation. today's This Thank your for concludes you

disconnect. You may now

Xcel Energy (XEL) 28 Oct 212021 Q3 Earnings call transcript