Earnings call transcript Q2 2023

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Operator

Hello, and welcome to Xcel Energy's Second Quarter 2023 Earnings Conference Call. My name is Melissa, and I will be your coordinator for today's event. Please note, this conference is being recorded and for the duration of the call, your lines will be listen-only. [Operator Instructions]. 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.

you and your today's Investor hand Vice Paul conference. now Treasurer President, Relations will over host, to Johnson, I to begin Thank you.

Paul Johnson

Call. welcome Second Good Energy's Earnings and morning, Xcel Quarter XXXX

President me and Van Joining Executive and President Financial Vice Bob are Frenzel, Abel, Chief Officer; and today Executive Brian Officer. Chief Chairman,

recent our members highlights the questions morning, This if team we developments. XXXX quarter the and in business review results second addition, share accompany website. In are of room that have and needed. on we other available management today's to your Slides will answer call our

As comments in could certain our Today, we earnings contain cause non-GAAP may that included some the our anticipated a that differ SEC forward-looking filings. comparable are measures GAAP to in reminder, and those reconciliations from of during today's and metrics are measures. release discuss results factors will Information are the information. on Significant our described call earnings release.

turn Bob it And with over that, Frenzel. to I'll

Robert Frenzel

Thanks, everybody. Paul, and good morning,

and to for start $X.XX us half guidance. the in case tangible as plans in Let's the earnings $X.XX to as place share We recording to inflationary XXXX from got headwinds We've of the overcome quarter, second items some of the deliver our pressures and impact compared the allow second faced Minnesota other share lower-than-expected quarter weather of rate in the for electric per year of the on the second well as XXXX ROE in our XXXX. per with results.

across eight that our clean invest carbon low. customers this to and to decade. lower past priorities customers' clean states keeping customers' savings financial our for And provide energy economy. in bills our are vision the strategic cost transition, experience the on transitioning resources Leading delivered while strategic we've energy a both our But our unchanged. We enhancing

the transportation all enable face network continuous we operate We're innovative been a operating the infrastructure to for reliability unpredictable And to we've to and to and of expenses our businesses fuels customers for our efficiently in weather. infrastructure accelerate our provide economy, and economic more on development lower also to past and for focused -- a objectives the for We as a customer clean provide a and of invest flat and improvement quartile expense carbon keep decade. with exploring lower top able policy batteries resiliency burden volatile desires in foster nearly over the building clean customers. for over to like new technologies to result, to

actions, are these from reductions and benefit national customers Our residential including average. the below that significant carbon XX% bills

earnings a our of we on As again our you our stakeholders our long ability see, guidance in to can commitments of meet and XXXX. have in delivering to confident are history all

on made both resources we energy clean power purchase plans and growing our quarter, with company-owned This transition a progress portfolio of agreements.

will utilize an solar our of In coal rights three a XXX XXX Sherco megawatts purchase projects first the we in solicitation, the there. generation transmission brings at to self-build which the solar of agreement. This our NSP power total megawatts recommended units XXX-megawatt company-owned over for incremental retiring

also SPS new self-build megawatts projects the power facilities. of we battery XXX solar and the one of proposing recommended to a agreement. self-build portfolio project In and purchase RFP, XXX-megawatt storage We're solar a a

for resources. we potential megawatts quarter, expect nearly file Colorado of In to addition, later portfolio X,XXX our recommended in the

significant renewables can geographic result, we enjoy benefits retiring Xcel economy. to should a based ability from to transition plants, tax which customers. IRA our a benefits energy a our eight-state reuse and analysis, And advantage factors, outcomes customers. of and low which to combination on beneficial and as the prices provides capacity interim very solar our enables resources, new deliver clean And transmission wind for at capacity a competitive footprint, to Energy the to factors. due enables all our faster Across high a higher be of

Each base forecast. the decisions proceedings for commission and for represent second anticipate our compared half of capital RFPs opportunities on in first these of half to We and as would these XXXX SPS. the of Minnesota XXXX Colorado, in incremental

to alongside Form are be energy Sherco and evaluating In Commission May, exciting projects at Energy's the be our our to could a solar unanimously filing second Ventures new Energy supportive Breakthrough XX-megawatt clean announced approved projects. July, grant for site that of We this battery plan Energy sites in $XX the pilot pilot our In quarter Minnesota new two our XXX-hour Energy Form the on support technology. Form later million for pilot installed technology.

We're rebates homes, community also qualified opportunities stations support filed further at Energy public our and supporting to Colorado, electrification with projects customers. of reduce we to charging XXXX programs charging plan additional buses, cost multifamily income the working Department school It which XXXX proposes and plan, includes and May, solutions of innovation buildings our businesses, proposed the new covers and transportation also period in the electric these for funding to second the customers. and locations. In expanded

Our transportation build-out customers and purchasers. charging EZ reduce of quarter focus range is to communities bring the expeditiously clean of to assist anxiety all and to to in

affordability with reliability natural electric plans our Minnesota file for our Heat month, framework plan of will and a plant goals to fourth our for carbon gas our be the Colorado system resource achieve will to follow during plans and Next innovation natural similar customers. provide quarter. plan our gas meeting reduction Clean we needs our in and to the These while

home innovative now safe, future. and are customers Energy meet our and in a electricity long to transportation partnerships projects these that to sustainability affordable as into essential and energy heating they deliver clean to and goals Xcel clean, expect our for and and reliable the whole, continue Taken the

in Marshall of In the the of the findings Sheriff County XXXX. cause Fire June, December Boulder the into investigation of announced office its

the fire, property with employees whose do this to an own and lines. power the an continue Xcel thoughts homes impacted affiliated this entity families devastating were families Marshall our states nothing a that and and report with Energy's to by affected. on The had started ignition be Fire Our called Twelve ignition with as directly including first result Tribes a that communities of the the

The the Sheriff's to away report power ignition feet more approximately discusses a at second XX after also estimates that hour different fire started which first is our XXX the from lines. an location, than a report

a most the our fire litigation cause the disagree has more forward Marshall in that and to in the discuss vigorously the second pending PSCo's ignition Because to look power we in position at says we're filed, time, detail but ourselves strongly of report of Sheriff's that presenting been conclusion. we lines, court. was probable this defend with will position not and

there. information I XX-Q some of you about would lawsuits direct legal filing, additional earnings the the standards and relevant our in and Importantly, is and included release our

Finally, priorities we communities; recently our as our achieving and report with progress to report. Net value people. focuses integrity our ESG well our forward. released responsibly; details core The strengthen It comprehensive goals on our ESG four moving Reach operate as sustainability Zero pillars: industry-leading in

community emissions half customers power industry carbon-free XX outperformed Xcel Some past resources In of compared by XX,XXX highlights our reliability projects. standard XX% in to include Xcel more as to to from we within of Energy electricity organizations during to the than improvement the XX% over to and $XX events. addition our since reduced and year, through XX% Energy And carbon comes restoring over hours our has local contributed nationwide. for $X XXXX. provide contributing key the nonprofit customers major hours the million Foundation, this of million storm employees volunteered We

proud safe. turn it's on over our With our that, I'll committed, It's We're it to strategy, our Brian. corporate and record. based of keeping values connected, trustworthy of track with and

Brian Van Abel

depreciation good of Minnesota per share the and Bob, for everyone. that reversal Texas as included case the and year Thanks, lives of rate amortization by case. had the share in increased following: of deferrals case more comparisons of a the note this Minnesota We Please rate $X.XX Most $X.XX share, the Lower earnings this to the are for the and XXXX rate of line-by-line significant drivers earnings rate depreciation case $X.XX last expense XXXX. last the from due true-ups Texas statement quarter extension compared year. morning, and result quarter the the second income for complicated largely year in per quarter per to earnings

Minnesota are and offset per Colorado. decreases These investment in than Lower property by earnings taxes other partially by program. increased our income deferrals tax share, reflecting capital $X.XX taxes

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

earnings Texas by decreased Offsetting higher Minnesota electric rate unfavorable share. rate these last of of interest lower revenue revenues O&M by expense Higher by the per decreased decreased from $X.XX and recognition earnings case per earnings share $X.XX drivers, year. less the expense the impact reflecting per positive fuel weather, case and share, $X.XX

X.X%. sales. Turning Year-to-date to by weather-adjusted sales electric increased

electric expect approximately annual by of continue We driven sales projected which residential XXXX, C&I declines by partially growth sales, to in offset in is X% growth sales. in

the the debt expenses offset of previously generation increase to was and timing case of costs in million quarter. $XX for to electric by shifting deferred second expenses. Now bad due partially rate the the the recognition higher O&M This primarily costs inflation, increased expense, outages, from Texas insurance XXXX.

actions. levels, expenses, compensation well discretionary case taking Minnesota variable include employee mitigate evaluating management O&M, and drivers are these which rate as to actions Given we decision, as staffing other will the programs, consulting,

we a expenses result, the expect year. now O&M for As X% decline to

commission recommendation test the of with the proceedings. million the not electric completed reconsideration quarter, ratio file plan our proceedings. in decision an progress ROE of felt ROE forward During In recent decisions ALJ of a X.XX%, of rate other as to on XX.X% Commission equity Starting three-year with the June, or consistent increase in made on was several proceedings. an a We $XXX second for we regulatory based Minnesota approved year. also we Minnesota

we South increase. ROE of the our $XX for year. Dakota Electric Colorado and our reached rate reflects revenue a approved case, an million ratio increase approximately electric historic that In case, XXXX million X.X%, of partial based In a test $XX a on rate pending settlement an XX.X%, commission rate a settlement equity

the items depreciation. and litigation TCA Remaining of the structure are of for rider treatment

ROE electric We of we effect year. test on $XX ratio a XX.X% our New contested that an decision this a with of later rate into summer expect of reached based commission the rate forecast million in rates the equity September. X.X%, in Mexico case, going reflects increase settlement In

October. and New the a interests. of significant negotiation and of interveners final expect Colorado implementation by wide Energy Xcel decision compromise varied the reflect and settlements rates We and with by Mexico Both range

that the in a for resulted reasonable settlements The just customers. parties outcome believe our and

without approve we a modifications. are hopeful commissions As result, will the our settlements

early pending are also the Texas process. We which in Wisconsin have and rate cases in

while in in decision Intervener we testimony in a August, first commission the a by of expect is year, intervener with Wisconsin and in Fall testimony decision expected Texas next the the quarter in year-end. case

the to Turning Inflation Reduction Act.

most consistent you transferability, Treasury aware, credit was on expectations. U.S. provided are with our the recently As of guidance tax which

monetizing We have tax demand later year. anticipate considerable excess in and credits the

Finally, growth objective share, EPS we consistent which of our to range detailed $X.XX reaffirming assumptions of our X% the We've XXXX earnings are guidance which in updated with latest our key to is $X.XX X%. reflect long-term information, release. per our are to earnings

assumption regarding guidance primarily property the regulatory levels and earnings taxes assumed riders, that changes reflect note to and changes ETR are decisions depreciation, largely PTC capital neutral. or Please

impact a summary. of up portion assumptions the expense wrap With the will that, O&M quick generally I'll and However, a interest with lower earnings.

XX we to have XXXX our range changing as managing continue through and years, to expect regulatory periodic environments, We past headwinds. earnings deliver for outcomes, the within economic guidance

continue states our And the clean plan growth. X% range economic transmission capital of on long-term and clean as we energy reliability, the remain to deliver our opportunities including to earnings and X% upper can objective transition. and communities and support to and our resiliency, generation, confident executing on dividend support within growth delivering we we broader We're distribution half in

concludes we remarks further. take prepared our now This will Operator, questions.

Operator

JPMorgan. question Instructions]. Tonet from go [Operator Please our And first ahead. Jeremy comes from

Jeremy Tonet

Hi, good morning.

Robert Frenzel

Hey, good morning, are Jeremy. you? How

Jeremy Tonet

good. for Good, having Thanks me.

if wondering back reductions see bit years? called any as with O&M into in helpful. much bit in to out could I the of there nature efficiencies base a future you for touch would to the one-time more on thoughts targeted there Just you wanted XXXX. little these onion be this versus carry a is how peel was Just forward

Brian Van Abel

question. thanks morning, Hey, for Sure. Jeremy the and good

year-end hit on couple a near-term kind to was last How of think One year we system. some ways. in year, one-time in is it. at elevated we about investing having second there we if of half good look O&M of relative had the first versus QX the at items look So O&M, I a do and of I'll half about you and as the our in actions QX particularly year, hit last guidance? Talk different think it we

impacts where expect generation outages higher expense we've And are decline. this earlier expense this And of some given in year. timing we also saw there price earlier some impacts had then commodity year some We levels bad debt debt in to bad this year. the

I about that, level debt sustainable. be So think as more expense should bad

at also call near-term have opportunities. You some outages, I it generation but a and looking what of and then timing we're number long-term

call Near-term management is our Innovation lot more initiatives. spending team. program and and we're consulting, a compensation levers, more what initiatives think of you'd discretionary Transformation longer-term on third-party around time one-time items around contracts But traditional spend, I variable

in technology. and our process in We've improvements And across we're heavily also then invested heavily driving waste investing orgs. call we what elimination

Operations is using before I've talked Digital operations. Factory, You in heard AI something our which the we on call focused me, about

with Action We that in started nuclear program. our Corrective

distribution that use rolling our looking for also operations that's to and we're AI. traditional field using Gen gas AI. cases in at out Now We're and now

decade look we is it, flat. Bob to work we forward. as X% think done And we've for a year, to down as get is keep do go some and So Longer a have term at term, goal nearly of the of there flat as a for our our we that longer so kind O&M but to to year. hit said, O&M balance goal then

Jeremy Tonet

comprehensive, very there. That's it. helpful Got very

it year that? has regards caused is And will of any and order, the this so embedded remainder five Minnesota items, guess, adjusted your and the touches for at of out, on, point, just kind kind revisit I if plan of with you over question you next I called the that assumptions had O&M to, these as

Brian Van Abel

don't does. it I No, think

earnings think I long-term to rate. assumptions about our our and X% growth long-term XX%

that expected long-term continue leverage half to upper of We to on guidance.

Jeremy Tonet

you growth given has it. over or higher the could, time at level, strategy, that thoughts on then have And wildfire of a just other mitigation Got do if evolved side? risk, your any I guess, I

Robert Frenzel

it's Jeremy, question. appreciate Hey, Bob. I the

operating Wildfire is a programs As particular. we we've be Colorado the expect and in that under three refreshed Mitigation Colorado And programs in propose the been understand year. this west years you more that And at know, ago. in footprint of of end Colorado of existing new company probably the volatility plan instituted Colorado to weather due continuation the of in in Plan under than to the -- that was and

the our through working So that. right to we're and at specific we customers. our but system sure the can certainly strengthen we looking our now, and that Nothing still and everything in risk own communities that make terms opportunities of protect

Jeremy Tonet

it. Got

far. change last what here if I Xcel's the one Does Minnesota of relative Just your attractiveness seen anyway. post Minnesota footprint of wider we've one, could, so in in versus view

Robert Frenzel

say, helping as their and policy run communities think, and Look opening we've Minnesota our on remarks, states energy our disappointing reasons. clean Brian I with to have said our Paul -- the was I mentioned my two customers transportation. in And I'll Minnesota we inconsistent eight one, feel utility been really for in decisions that in around across and like it XXX. states, focusing good outcome, was our clean was and a which XX previous and achieve objectives

do the to and legislature state, proactively to investment Governor these initiatives. the this confident work I we important, Making and of in the probably equally think review a lot national to generally state. programs affordably is the and our these initiatives. that Xcel Energy continue and and a advance our it We headquarters sure opportunities recognize I utility We'll PUC but But advancing really think sustainably. what in leading is our didn't reliably want with

Jeremy Tonet

That's I'll it. Thanks. very leave there. it Got helpful.

Operator

Thank you.

question Durgesh comes Chopra Evercore. ahead. of go next Please from Our

Durgesh Chopra

Hey, morning, team. good

I on Sorry, was mute.

Brian Van Abel

Hey, Durgesh.

Robert Frenzel

still we're later, years by Three getting button. caught the mute

Durgesh Chopra

you I'm sorry. Okay, now? hear can me

Brian Van Abel

Yes, great.

Durgesh Chopra

Okay, perfect.

mention that, item. about heard Sorry rate you guys. Brian, case Minnesota I the

appeal timeline? rehearing. as give color a are to Just us little just or steps more next you Could bit the what there

Brian Van Abel

need the to we its coming so order, that's for days reconsideration, XX the reconsideration Yes, -- up. written file after

expense we XX reconsideration pension reconsideration hopeful days right look And Minnesota and we're some they And prepaid around hard and have will take levels. decision other decide. at asset around XX once have -- days Commission for that the up the and at our will to they so certainly ROE, the file on filing,

the So that's process.

Durgesh Chopra

it. Got

and is should coming it after days That's that so Commission? Okay, a just be out whether XX then they the take shortly, or Minnesota not. decision up

Brian Van Abel

Yes.

Durgesh Chopra

in with discussion a Okay. the your Thank expectations. lot -- the on you. in mentioned topic And this line agencies was very been to I you then the of knowledgeable transferability within know investors industry, on implications and general. CFO credit you're guidance There's know

So you're your and play implications just get metrics? out this for there, credit how your thoughts seeing

Brian Van Abel

Yes, I our would financials. call spent industry a mean, we on through it I lot we've so how this work an of collaboration --

not who've worked accounting the of firms. with our utilities so And lot with only a peer also worked big four

every GAAP, It's And in income approach. through our so accordance the going tax going it's flow renews going expense to to to take tax -- income we'll with be line.

from through That also will cash flow operations.

And so lot And discussion FFO been it whether straightforward. show up know I in it's metrics. debt will to a I there's think pretty of the

these pretty So And we absolutely of good benefit economics a it will reflect it be financials. about as it for right, is reoccurring flow our cash tax us, underlying it I credits. look because will to -- monetize feel

through also the So I we've feel approach each those them the accounting worked will that. generally across and like and industry said, whole And good take. big the with rating agencies will about reflected closely with of how spent time I it firms pretty X be talking

Durgesh Chopra

question just history this, a of exceeding you very willing maybe XXXX little comment the and just bit then Thanks. And meeting to you're Obviously, the on expectations. pointed more guidance. helpful. on to That's mentioned extent

tracking sort in within your where with where the and the that you cost unfavorable range? you tracking Just weather are you of are decision, targeting? Or and place, what regulatory with are efforts guidance

Brian Van Abel

Yes.

of tracking year, right? kind we're it in you about think to midpoint I'll of the a I bit buckets. little And today, here So three give sitting color, right, more of six the months guidance.

of our -- on plans, execution is I earlier. O&M First which our about talked

benefit Second flight, last is year. the Mexico particularly do door additional in will come case the and service in case in sales second revenue from we rate rate with continued half our in rate have case there's in build territories. flight still the continued New of growth that to we Wisconsin the expected the And then Colorado then year,

And those QX, in targeting about so guidance. that three do as obviously, we in of the I are at it in normally investing tighten to And really where are we buckets guidance. think will QX, look we midpoint

Durgesh Chopra

Thanks the Brian. clear. Very so Appreciate much, time.

Operator

Thank you.

Julien comes go of of Our Smith Bank next question from ahead. Dumoulin- America. Please

Julien Dumoulin-Smith

that some the the commentary been the that differences are your Q team. little on as good for state alluded you out-of-state how levels as as scrutiny? understanding I remarks, I frame your well drawn of you and to Obviously, the from can here, principally XX-Q appreciate the immediately some wanted from dynamics. you morning well programs the you wildfire so you in here, sensation considerations lawsuits Hey, this, lot of that Thank well. much on focus the from with imagine in some of of out on coming up a have frame a time today, here you but elaborate elaborate of perhaps but new the it. the insurance Can as filed? know risk can across said as us the to least at states I prepared insurance do critically you bit? you referred maybe to help the your

Robert Frenzel

now. report first here's about Tribes to Julien, what Boulder respect Fire thanks hey right Bob, and this can that property ignition on was for equipment. the our cause it's the no County and strongly The or electrical the ignition. vigorously share And after ignited will the concluded Marshall area and the or deficiencies conclusion Marshall of with that that With court. we an began to a were of Yes, first, installation unrelated ourselves concluded hour say second the I Twelve which the The services, the Sheriff's of there or Sheriff's in in disagree design circuit ignition the defend we public the defects report maintenance in of question. second report,

lawsuit hearing learn And the disclosures there's on standards we release and are September where XX-Q. procedural to legal more in in in the steps, so regarding about our next and included litigation, in additional expect a the information earnings our the our

those going our Given let the other statements. think I I'll lawsuits, to Brian to we're but on than comment disclosure beyond don't further stick particular that, going we're think disclosures. I comment coverage, to insurance any

Brian Van Abel

And Julien, million. in included insurance Yes. is our disclosure approximately the coverage is $XXX

Julien Dumoulin-Smith

differences then whether constructs it. further Got in commentary about All any legal across different constructs? states, the context especially pertains Understood. recovery right. to and/or And it jury

Robert Frenzel

in entire all disclosures the in page earnings included the in it's Q. of Yes, an release disclosures

Julien Dumoulin-Smith

All right. enough. Fair

We you much. it very there. will Thank it. Appreciate leave guys

Robert Frenzel

Thanks, Julien.

Operator

you. Thank

Our Mizuho. next question comes of go ahead. Please from Anthony Crowdell

Anthony Crowdell

Hey, morning, good And Bob. good morning, Paul. Good morning, Brian.

Sorry, I leave you didn't out. to want

when quick following give one there that that just and wrap let the you Or lifted? to it courts of overhang timing play have proceeding on that two Julien fire. you will when questions, itself? to hopefully -- Marshall up feel and can't the up resolves any Julien Just a on real Is with

Robert Frenzel

lot we'll where have more about going schedule, and to learn the September As I a know we a mentioned, hearing of procedural that. we're look, more

Paul Johnson

can't we disclosure. really in Anthony, already beyond said we've And go the Yes. what

to we the So have questions that. on limit

Anthony Crowdell

the Okay. Great. Slide in settlement then Colorado. pending on And XX,

proceeding? separate the hopefully, they that they deferrals? approve they rolled that's handle alternative is dependent that -- but I the plant upon, deferrals. Just get curious you does guess I'm when increase could how some about address into $XX million, think will you how will talked when plant Or an if just commission the coal I settlement, coal talk rate about, they a

Robert Frenzel

commission decision will will within case be decided Anthony, make QX. that that No. in here all rate the the

So all on so July, in -- they it's had hearings and they deliver part of it record. the

$XX depreciation And million just deferral depreciation. that the $XX alternative is difference of one you defer $XX or So either million some it's of additional the the is kind million. if

decided. be So all will

Brian Van Abel

impact, So would flow but have neutral, obviously. cash earnings it a be would it

Anthony Crowdell

good I'm here. thanks. Great, again the Thanks for from taking questions.

Brian Van Abel

thank you. Yes,

Operator

Thank you.

of from ahead. go comes question Karp KeyBanc. next Please Our Sophie

Sophie Karp

questions Hi, good lot questions. here. questions have morning. I a couple ask A answered, maybe my been but And thanks of can for just taking my of

drive weather like if -- discuss equally little seems bit So volumes equally on residential. curious could like the well you variability volumes, C&I it volume a just here or were from I'm weak aside as as what closed

takes So some and drive I year-over-year? are what guess, it, puts that

Brian Van Abel

sales We Sophie, of year-to-date this to on in strong on yes, weather first a quarter had Minnesota looking if large to strength think basis. normalized There really first on I on and facility for continue growth really in about we weather in Colorado see and C&I. of in the the down sales, and the at normalized Wisconsin a out a the basis C&I Colorado. was SPS year manufacturing side quarter QX is

but for continue on So the had we're right? or for line down year, our efficiency see customer as expectations see some energy the we declines do continued with program. have residential forecast We It's the customer weakness side, tracking in for -- while close residential growth, strong to the our that we really DSM X% year. use to and good

side, for year balance think I tracking the both the and So for on the guidance kind is through months the of of six the is on and it expectations sales. overall, side on with C&I our tracking to resi first

Sophie Karp

looking it's still to been maybe you're operating of Just ask new progress how thinking kind of territories? about just I can report. a been into And you've the at picture involvement curious in right. potentially know I that your question X and All bigger if here.

Robert Frenzel

a existing It's a future. priority have and for sure company, -- and for for future Bob. potential current view we certainly country. preserving making there's the we We nuclear us Key -- that on is look, as nuclear, nuclear the a both a fleet

through their We plans company technology. them any have SMR We guidelines so for that a have regulatory helping operate on company future specific our are an and get hoping process. SMR with with -- and with own mostly We SMRs don't to their nuclear the through technology a regulatory to applications meet can technology been expertise process It's that, and NRC point. have in a company making at specifics. that as get plans nuclear don't the taking to that working NuScale the the or called this just nuclear helping we announce on sure really

Sophie Karp

Okay, thank me. you. That's all from

Operator

you. Thank

ahead. question Goldman comes Davenport next from Please Our Carly go of Sachs.

Carly Davenport

Hey, Thanks taking for questions. morning. the good

Robert Frenzel

Hi, Carly. aboard. Welcome

Carly Davenport

Form Bob, the Thank appreciate above that. technology kind sort talked perspective. of support of about bit of pilot long evolving you of might the to storage? kind bit about Energy itself, Could if opportunities space been on from little just talk you a transition other all the pilot. that And vocal that is for little you've you, about you an in approach how grant energy about and a that exist duration the a think

Robert Frenzel

a company, announce to free. Yes, XXX% happy to. it first Look, as about carbon as utility we think

our our wind with in make to we us an XX% effectively very through transition confident of this to target and ability on solar our energy technologies XXX% end obviously new for allowed feel the focused position, an clean of goal energy nation's customers research, big that cost goal of the pieces achieve we But we've the always new been development geographic our to storage. decade carbon reduction, Given new of and of in interim deployment is One need that. technology,

some a energy the lithium a batteries future. our have we have energy our is critical the storage on around country, own ion of part of The systems. lot and for We long-duration

the Form so battery. battery Energy hour XXX-megawatt a is And

wind as in asset production. Winter X-day of had early a days. Uri, for that class limited seen as we it's we about and hours, think nice Southwest, a periods we've wind year. X wind no June almost of we And very as doesn't recently of polar had And instead that's So blow this the when the X evidence sun Storm seen shine. doesn't in where vortexes, period. In where the production where it We've

So of the exciting is was XX Department by a long-duration a Energy it's ago. technology battery this of What's particular, old almost This idea pretty years really really. found in interesting. about Form,

Energy the is not and I team to efforts Partners-funded impact because Form and we an part de the in founders they're regimes is it And interesting. VC-funded simple But company is would And it's and that new the but where about challenges. the energy becoming commercializable development world a that resting by of and technology domestically the of Impact subject to counter readily call pretty It's great parties company, company, available, minimize the want rusting a it's company. iron. the basically Energy breakthrough have iron that available. and

last best And one not and to be so And the Mansion. Home We're when Form we Secretary that X the Virginia really Grand speak, I West that low that's from fastest. in team was the I with and the think it's XXX-megawatt wins, about in ground West factory deploy most proud and with Virginia building guarantees month as new Sender breaking capable grants an the sometimes technologies, Energy with government. commercializable can it's the and

to partner put that, this it to is really fruition. in it's on first It's we're technology a megawatts So of going to that's going system. be that's sales come X,XXX technology megawatt pleased pilot. to and a scalable. XX a a but be We're going It's to their

and alongside grants and great cost energy grants and the breakthrough them that for potential buy a the DOE have build opportunity we and down that it then So with down invest the to buy risk company.

about very technology, So can the future, really excited mean. this what exciting

Paul Johnson

technology it duration. duration, just XXXX. call so we'll that a another add, Colorado have online [indiscernible], we which And liquid have of mid Carly, kind pilot metal to That's in is I a would in

as think this firm the on storage, we're some to about think energy of burn of a a spending green energy if also then is able So of definition form and storage of longer term, technology. we broaden lot be stash store kind longer longer through And it term, we of hydrogen all units to new time I our term.

pretty our of that we're So of happy form on unanimous energy you how really about technologies a excited glad call see to it Minnesota the is with project. and commission approval lot new excited

Carly Davenport

the I the X% follow-up wanted XXXX. around check reiterating Awesome. obviously, I appreciate earnings those perspectives. X% to in And you're guidance the and for just guidance. on temperature then just guidance, to long-term on

spending opportunities the are outcomes incremental CapEx range? thinking the how from about kind that that you perspective about regulatory you've think with a seen of kind you along long-term of some As of

Brian Van Abel

we delivering X% upper X% long-term in Yes, guidance. our of continue to And question. Carly, the good fully to expect half

So that's unchanged.

I of I think free benefits mentioned SPS. And in are Bob's the in the comments, opportunities customer filed the he We we Sherco SPS, have. that XXX that megawatts Solar CCN provide yesterday. mentioned significant to that incremental you Farm, going the farms think solar

that are together X customers of billion benefit are north those will capital clean outside plan. that energy of $X current So our investments our of

we'll QX right, we preferred or in that, term, around going the And I think RFP layer before ruled IRA the on or the spend Colorado of commission benefits customer resource plan into significant file here decided on Commission could the that benefits with IRA. our with longer pre significant those

renewables look So how what in stored bigger at will faster when we we showed. approved, and what go X,XXX coming the in believe and to initial of are relative the megawatts above costs we was

that, QX XXXX XX we on be energy more for to as Commission we'll and SPS Colorado in months, XX filing X give RFPs in our a significant and then with next work the additions longer more march hopefully assets a to of towards look by excited in that we're goal. clean even Minnesota, filing term for Colorado decision So further

it, about of about So guidance I'm feel upper delivering pretty and excited do half the in about good our opportunities, excited long-term range. long-term pretty we

Carly Davenport

Great, thank you.

Operator

Thank you.

Our ahead. next comes of Steve Fleishman Wolfe question Research. go from Please

Steven Fleishman

all hi. Yes, to Good you. morning. Good of have

including On the phone Paul.

any deadline there a question. to Just be Is need first, one by? Marshall claims filed fire when

Robert Frenzel

deadline. Steve, My Bob. understanding is are Yes. X-year claims a it's that

that of need claims when say the this be filed. year So would to is end

Steven Fleishman

Okay.

I approval? the order. Second for for know date specific different I final -- Is question, topic there there you the think a QX settlement. Colorado that mentioned on a Is

Paul Johnson

There's not deliberations in the date, a that probably Steve, the in but of expect middle we rule August. August, whole middle of the commissioner

Steven Fleishman

thoughts think going kind out whether get -- might number been then And you lastly, that all look curious this focused or a on we'll I hydrogen, just included when in pillars know do that? provisions, for hydrogen, on you to problem Okay. hydrogen the that at additionality the latest production just have the you'll those IRA ability I'm to be of pretty one. And of green all kind a green and including be get of of hydrogen nuclear

Robert Frenzel

Bob. therefore, going general philosophically, in areas. in and or the large very a we going particular. Thanks to as it's cases, next We've difficult country XX molecule the economy a a been over or and feel believe for need that Steve, period like And a in some that expensive clean Yes, Look, hydrogen company, we we're we clean electrification fuels to the question. to electrify. active help in as in there but or be undergo years of to of impossible XX that parts even those are are

opportunity is And natural green the a states molecule. as of two most are it. And Rocky of see this It's Colorado applications. version One that's like the tomorrow, from But hydrogen an well Mountain as hydrogen looks fuel we for today, serve at And another we've for MOUs and supportive and Mexico fuel of some that government of supportive level. it. two company. we region promising in Utah it's gas. molecule The got four states with New Wyoming. hub of which set

and And of you're have to of And in get the North hydrogen. aware process, the through for we and think think a and of and accelerate three debate. think customer I cost need the and around us what location curve qualifies trying balance electrolyzers of OEMs down areas about there's build plant. to And additionality. which Minnesota, -- of land. And Dakota by sort matching DOE, serve, what front of two loan of know whether duly in And to of year, we I to the sort end five-state of Montana. credit expect three hydrogen of then technology to take we're balance challenges going for the the here MOU, generation And the we're Wisconsin, and some to do that tax those the progressed as is again, those Midwest, we're of it upper in then I grants a

to been end, categories. those we we've So location, of think flexibility with need on all three those -- all in one in three of respect we

area level we've matching, not market type certainly would and challenges transition hourly generation need On that balancing distortions nationally. which location, supporting company, probably hourly think with to national, a but been strict the matching, I we say some but location, need real Similarly a causes matching. that get pure on the we as period to

And matching, the matching late but decade, period time. of to annually we'll we've the so got period of we've of some or for some been time where decade of end hourly go this maybe supportive by

additionality, have back then additionality again, there. if areas back but as in additionality, additionality otherwise grid. as the to we that vocally And support would pretty a as well the really down supported with very flexibility concept of of One, any nuclear supportive that regards would into and we as we of it sort support energy came

And we're so those line at of very -- that both are active. with organizations active And active we're I EEI, principles think are very generally in very those supporting.

Paul Johnson

there's hearing viewpoints. yet, asked Steve, around some still what polarizing the we're XX. but statutory they outlined in a of about the missed uncertainty given you of that haven't deadline deadline position is it of And August lot timing. statutory a The

or September into slip could certainly October. it So

Steven Fleishman

Thank is you. that a information. good of it. Appreciate lot Okay,

Paul Johnson

Thank you.

Operator

you. Thank

Ryan go question Levine comes next Our of Citi. Please ahead. from

Ryan Levine

Hi, everybody.

$XXX strategy insurance, when in and the it insurance? basis you forward, what insurance? on the guess, pricing was terms insurance for And occurred? wildfire-related related million what's then are to of going was of I In your And cost go-forward changes a that seeing

Brian Van Abel

program, not companies. what wildfire, We insurance we all on all disclosed about to for you to just we but can we that's every it as year more continue our gets renew that. insurance. insurance the is Insurance look imagine, for program that's experience market cost, the at to have everything say time, And haven't is Ryan, the and and challenged based related

Ryan Levine

in you already for back half procured upcoming is event next year? Or year? of for 'XX that the the Have it the an

Brian Van Abel

the We're still in process.

Ryan Levine

to one that. passed your is the costs Is mean, I I associated O&M cost $XXX so And in guess that Okay. million, it. last on with embedded question procuring outlook? Or that on any ratepayers?

Brian Van Abel

through It's yes it's and included cases, O&M. recovered rate in

Ryan Levine

included It's in...

Brian Van Abel

O&M in expense. It's included

Ryan Levine

color. Okay, you. Thank the appreciate

Operator

Thank you.

Abel the Brian to CFO, have remarks. Van no in turn we call queue, As over will further closing back questions for I the

Brian Van Abel

our you all Thank Thank follow-up. Investor Relations earnings call with participating in morning. team Please any for our this you. contact

Operator

That concludes today's conference.

now may You disconnect.

Xcel Energy (XEL) 27 Jul 232023 Q2 Earnings call transcript