XEL - Earnings call 4 2023 | Xcel Energy Inc.

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Operator

Hello, and welcome to Xcel Energy 2023 Year-end Earnings Conference Call. My name is Melissa, and I will be your coordinator for today's event. Please note, this conference is being recorded. [Operator Instructions]. I'll now turn the call over to Paul Johnson, Vice President, Treasurer and Investor Relations. ahead. go Please

Paul Johnson

to welcome XXXX Quarter Fourth Good Xcel Call. Earnings morning, Energy's

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

members of addition, room answer questions your have In needed. the to we if team in management the other

share updates This long-term on will highlights, growth XX regulatory and plans. results our we business updates our morning, and review recent and provide

are call on website. available Slides accompany today's our

forward-looking our contain Significant comments both filings. during and As could today's results factors our a reminder, of cause may that some anticipated the call are earnings SEC information. to differ described in release

Today, we'll reconciliations on and are Information discuss included in measures. release. certain that non-GAAP our comparable measures are the GAAP earnings metrics

actions are ensure ensure the In the to success. fourth streamline aligned needs to business quarter, resources and our customer long-term workforce organization, Xcel with several implemented

program voluntary XXX Xcel retirement employees initiated under retired. which a nonbargaining

In positions. eliminated bargaining addition, XXX we

workforce share of million we $XX reduction recorded of a 'XX. the As in a result, expense per fourth $X.XX or quarter

in core or related dispute coal the $X.XX X legal of to regarding a we per between $XX million Comanche recorded Also Xcel year operations share Energy plant. prior at a and charge 'XX,

of earnings. nonrecurring these have the from both ongoing nature Given excluded been items,

As while were exclude $X.XX these $X.XX GAAP nonrecurring per per a result, ongoing earnings were charges our share, earnings, which share.

All further discussions earnings. focus earnings call ongoing in this on will

see please this, in our disclosures on the information more For release. earnings

Bob. I'll that, With the to over call turn

Robert Frenzel

financial everybody. We while reliable provide energy good performance. another and morning, to clean, and our Xcel an Paul, Thanks, safe, continuing operational delivering year with and had successful at customers Energy affordable

to for resiliency investing capital while vitality on economic our approximately growth our and program enabling In $X in Xcel the energy executed Energy communities. largest XXXX, for and delivering customers clean history, improve billion we

which competitive guidance. benefits $X.XX is capital, a of the to critical Our we as access exceeding earnings maintaining consecutive our markets our meeting share the to earnings representing in operations enabled operations. cost our XXth our Meeting financial year capital ongoing of per of or investments customers commitments fund

approval over almost X,XXX megawatts ground we represents new clean to deliver investment, necessary the of billion commitments transmission $X December, resources. worth our with of energy billion received generation breaking cleaner coupled In an for which of generation a $X.X energy when in This new Colorado portfolio with economy.

our these great of I other achievements. on with look proud we I'm on year, stakeholders deliver how the teams to And many as partnered so back accomplished so many outcomes.

for While believe and of our performance in quartile and values the wind the electricity strong deliver to fleet, third improved our Across customers. year. scores consecutive top U.S. the yet, delivering SADIS utilities aren't corporate availability capacity final target continue for be net reliable in we we'll our to we exceeded our

customers. a cases zero reached gas pending Colorado our We multiple our states regulatory in navigated We emissions rate resolving clean in Texas natural calendar busy rate plan and natural to electric greenhouse innovation a settlement of those framework Minnesota, plan both providing case. in and in gas a gas our achieve our net for filed very heat

transportation electrification New commission in both and Colorado. transportation updated in programs and pending along approved with We've Minnesota Mexico in plans Wisconsin, approval

customers. part fire of pilots, and We lower to These SPPC's and storage Hydrogen transmission projects. energy the of the weather resiliency in our grants Energy support by long-duration MISO $X.X these and were energy energy for the while of awards will the form over projects Department of hub, partners Heartland resiliency, cost all additional clean billion as extreme

several on be footprint. the system a for low our agreements with signed our Meta continued with we gigawatts in QTS and in XXXX, and data AI-driven demand centers Minnesota Colorado. pipeline center driver in In Data across to

our at coal XXX-hour XX-megawatt received XXX solar of pilot megawatts an Form for we our Minnesota, both in facility. Sherco additional retiring Energy approvals In battery

We for operating later X,XXX which year. we renewable resolution on megawatts of our this have active across RFPs companies, expect over resources

plans in by which an filed company, to our We our could XXXX. also SPS XX,XXX resource to megawatts add additional our system X,XXX

In our baseline, retiring the for while Unit past and X at coal reduced of at carbon layoffs years. for with over no compared Sherco facilities personnel continuing XXXX. track our a as to retired coal XXXX facility by utility XX We December, we our electric the goals the emissions trend XXXX XX% on

while, the remain lowest amongst our All country. the in customer bills the

the our years, X.X% kept and and below the rate natural gas and X bills inflation. past XX respectively, electric X.X%, electric the of natural and years, the residential, the bill last gas XX% are Energy And annual average, over average residential XX% to well Over national we Xcel respectively. increases below

communities. our in involved actively We're

As our and over more our than contractors organizations footprint. support XX,XXX volunteered $XX to hours employees, retirees provided and charitable across million

We initiated $X.X than in X,XXX more XX our which projected economic communities, billion jobs. development investments projects are create to for capital and

foremost Human nation's For the survey corporate the workplace received Foundation's and Equality Rights the Index, Campaign seventh to Corporate policies practices year, related from consecutive top measuring benchmarking score LGBTQ+ we equality.

named finally, most by Fortune military of companies received And admired several in including multiple top by recognitions, Magazine. organizations other one a we being employer world's the

these significant our employees Xcel and our We're proud alignment, operational policy which achievements, to our excellence product of allowing Energy customers, benefits to strong a shareholders. with provide reflect valuable communities, and our

turn over I'll to it that, Brian. With

Brian Van Abel

morning, Bob, good everyone. Thanks, and

year last compared XXXX. ongoing year electric the weather higher to XXXX, gas $X.XX reflects compared $X.XX the include per of significant by earnings share. we margins, drivers earnings most share full of The For for and natural to per year. unfavorable share following: the as This per earnings increased $X.XX had $X.XX in

containment per which O&M margins. increased of $X.XX by earnings impact Lower earnings reflects the which actions. is conservation per and $X.XX increased cost in offset share, by expense lower DSM share Lower largely expenses

$X.XX share, Trust Higher performance, offset other expenses. to O&M income in increased Rabi is earnings by primarily which per largely due

reflecting and driven per share interest decreased share. taxes, rates in expense, Offsetting $X.XX investment higher which primarily amortization per our by earnings capital earnings to addition, these interest by $X.XX other per share. increased positive higher increase Lower capital taxes, and $X.XX fund increased to debt drivers, combined by earnings levels rising per earnings other program. items property And share, by And decreased investment. depreciation $X.XX which by charges,

Turning electric adjusted year X%, weather with assumptions. sales sales. guidance by increased Full consistent our to

we increase sales to to by X% XXXX, expect electric X%. For

to reflects expenses. we and O&M the with challenges expenses offset approximately Shifting consistent inflation This decreased or action for the $XX year. and million to during other annual faced year. is guidance X% our management

and also we reflects and constructive AFUDC for case, of decision settlement a first quarter, we life of X.XX% on several in depreciation which The proceedings. rate XX.X% electric the In the ROE quarter million equity XXXX fourth of ratio increase a progress top the of the rate During our rate Texas filed December, acceleration an purposes. commission case XXXX. anticipated made to of in is $XX

ROE gas November, a million an In Commission Wisconsin adjustments an costs an of XXXX. of updated based our program, X.X% power and million neutral. residential which $X reflects equity earnings approved on items, and purchase fuel effective January affordability natural for increase Rates rate were decision XX.X%. ratio and $X and electric increase of are of The other

test $XX an approved subject million, is In January. a increase starting case equity year. based we Minnesota rate X request year. commission November, requesting to for this XX.X%, this expected an December, refund in million $XX the filed of ROE Final ratio on later rate the rates a of of decision our XX.X% gas natural In interim

future so. file the natural we As Colorado or a far as in filings, gas next plan to case week

In half addition, we also of plan XXXX. wildfire anticipate in the mitigation revised first a filing in Colorado

of renewable customers. We for credit multiple tax our Transferability lowers executed our cost We progress sales the needs, PPC million. most projects reduces $XXX totaling transferability. funding $XXX on million production our executing near-term of Updating and in XXXX. XXXX energy in contracts importantly, anticipate

base capital our in We've capital transmission investment reflects resource of for base clean baseline energy the $XX X-year investment and the our plan, of forecast. annual billion. which X%. reliable and approximately to updated growth plan supports rate Moving plan to in customer-facing an the Colorado generation, for now capital decision a grid. The resilient investments in an renewable advanced results deliver This

Colorado. approximately billion renewables RFPs NSP is $X associated firm capacity plan in base for SPS our and in filings and included at future and Not with

debt these the assumptions to release reflect for this guidance financing year. We've changes the updated updated been incremental forecast to the financing also our equity base earnings have plan, Please that needs note and our for in investments. reflects which capital

anticipate reminder, we XX% approximately to As incremental capital any be by a funded investment equity.

while always of fund It a a is important balanced strong accretive equity a recognize balance to maintained maintaining financing that to credit sheet metrics. includes we've growth debt which strategy and and mix

to in customer interest to are credit markets maintain clean bills cost higher of and our capital solid especially competitive Maintaining energy favorable fund environment. rate metrics a transition capital and keep access a low, critical

growth the EPS in deliver X% long-term above which now to believe at earnings conservative. is remain Finally, X%, range to -- our we XXXX. committed We top the of to or of in end starting objective expect XXXX we

addition, future guidance will In results. we of rebase actual annual

X% investment low lower of the our and even a our equity of end payout over expect future. X% a in flexibility XX%. of significant financing result As ratio at target range more powder XX% us and reduce funding give risk growth grow the dry needs, equity financial dividend we to to and financing needs opportunities with dividend the the now will time, This current capital to

and litigation. brief a of Law The Now our ended of implementations significant update in saw December, with Marshall expected, as increase we I'll the conclude the claims. on number a in statute of

claims. we As with XXX aware X,XXX are lawsuits of approximately of now,

believe In the a time be February, determined. We XXXX. will trial early in which at be begin schedule likely hearing there will may the

a within XXXX ambitious to up the year a deliver With guidance range clean, energy. executing XXth for That our ongoing with customers deliver investment plan enabled on to Energy wrap in row. Xcel investment for that, quick I'll We're earnings reliable our summary. an

consecutive our XXth increased to year, the For dividend investors. we

carbon Sherco our X to multiple utility resolved for early plant XXXX reduced We natural retired foundational from XX% its plans cases gas rate goals. levels. our We zero emissions Unit coal by and net and reach

energy portfolio We our base our resources X% received X-year clean Colorado. updated capital billion, groundbreaking base growth. in plan which $XX reflects We approval for rate of to

capital additional our have backlog all of jurisdictions. We in

growth a or our line earnings -- the top long-term above to EPS strong achieve of We have of rate. at sight achieving to X% X% to end

expect electric from some they the And lowest have reliable in customers gas service and and natural the the while country Excel finally, continuing bills Energy. safe of our

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

Operator

Dumoulin-Smith first Bank Our Julian from of question America. from comes

Julien Dumoulin-Smith

to Obviously, guys already expectations. even been I how about variety do above if -- put midpoint how But year Congratulations on math like metrics of X.X% going be a bit, you different had X% the rate say, to dilution, kind here. here. will? with about the base up, And I'm of of just mean incremental a it you going think up do given your setting X% there, you and tracking that little right? the adding every you to think back doing might different slightly you the

Robert Frenzel

phrase doing the I like the math.

have transmission, our of I support is the X EPS vehicles, heard customers. Look, clean might rate that advanced follows base profile states, over some our think costs before. the our the investment dilution financing years, electric excited in really parent across capital about amount plan next level. we're with categories, asset X of multiple The grid, everything at Obviously, rate I accretive. growth for growth the updated new generation,

now. that's during But a and X% end of X% expect good X% above be our top rate to guidance at still this We long-term range. to is X% to growth the X-year the right or period think for company, we our

Brian Van Abel

Yes. And of my conservative I remarks, Julian, expect noted just will forward, going growth we in earnings. we a -- add And off I'd rate. actual as that do rebase that's

in script. So note important our to things

We're we're our and Bob electric are excited average. XX% in overall, the about said, clean and national below our fuel transition. one And And about of fastest the the steel opportunities our transitioning we're I country. think energy the it. really as And for utilities bills excited

So great place we're a customers. I our think our in and investors for

Julien Dumoulin-Smith

as to say. rebase appreciate Yes. a actuals. the I of sign being you strength, able That's of certainly

just the updated the being, and the timing for vis-a-vis for that to this at of here. time you to And year, that to think clarify perhaps do maybe about just plan in least this, to the back X% updated Now least How no needs? current here? change just plan X% equity come at

Brian Van Abel

million. in Julian, to for $XXX no still $XXX yes, assumptions Yes. change million guidance is year this our

some and follows. Now we've years. X in it. our amount there plan of But CapEx you regulatory -- how opportunistic, we'll above of then it was work approval kind that, over some equity I And plan but is and through look -- think through been CapEx over as an we've drip at incremental from ratable above year. back-end annually that this perspective, if look But that $X.X said least really million about increase be $XXX at expect we've loaded the ATM talked an we we doing of kind have we the the we'll with do the our billion follows processes have

Julien Dumoulin-Smith

-- of . bit commissioner your what's relationship in and we will. where here brief on a a And comment then you've experienced you mention little if maybe Minnesota, stand

Robert Frenzel

No, the out and working The of commissioner Yes. years. new comes been we've a got very relationship. over we've with long-standing him proactively department,

So a the continued with we Minnesota expect . strong relationship Commission.

Operator

. is from question next JPMorgan. Our Tonet Jeremy with

Unknown Analyst

Rich Can hear you me? actually on Jeremy. Sundelin for It's

Brian Van Abel

Yes, we can. .

Unknown Analyst

Great.

to I more timing. to ATM terms point the in table at at in appreciate of total picking I last the Anything you guardrails address the from little how that point gap bit you terms of opportunistic the the of that? on Just a on format any this needs. or equity. guess, Can speak might

Brian Van Abel

way plain the finance our pretty a we're way we vanilla No, company.

be of base case So a kind the issue. to block is

you doing a the base at look obviously mandatory we that something feel case our look And on forward level is with above can just something. blocks the but comfortable doing at ATM. or converts, We

Unknown Analyst

high over And Could relative in to of announcements. a to near as then savings at trajectory medium overall past level terms your work How long the O&M reduction few and the that the that parsing more the how workforce speak that outlook into well bit outlook, little term? guess, you've years. O&M relative the a accomplished looking about over thinking the there you over you're then to the to factors term I O&M and

Brian Van Abel

Yes.

workforce hit reduction the transition . me and O&M the Let question I'll us. longer-term first, outlook to for

like past reduction some over challenges faced a years. from think the everyone few workforce us I and cost perspective, else significant pressures

that And aligned said, to our we resources undertook some the of needs with opportunities. our organization. ensure And -- where are and so customer we as Paul our streamline growth

XXX X% O&M the program eliminated on approximately were said, forward, Paul through XXX employees and run basis. through that workforce look approximately as rate we positions that So another generates voluntary retirement so savings that a

look But as as the growth of of our that, we we I needs. support look into to will the company to areas reinvest said, customer some

up So -- is into our but into us 'XX, and guidance. that XXXX overall, sets included incorporated

to 'XX, in XXXX. As our were I about you really it's XXXX, 'XX what X% when to think but guidances look up to X% happened flat relative

of expectations our O&M Now longer term managing are. laser focus what a We've longer-term -- on you been asked efficiency. about with our kind operational

I at we're operations on think flat of O&M that if since you XXXX electric down look QX, our X X the or IR deck from have utilities side.

So really of. we're proud something

And shutdowns. we of have some coal tailwinds we term, look longer plant while

improvement coal how corporate that We down most lot our coal in roughly haven't a think year about Energy spend I Way X is of One expect a this a We call technology we that waste or unit the looking talked leverage last plant shutting can and it roughly waste at importantly, a which principles something And reduction on much focused looking and lean engine. it. then elimination. we're Excel a by year, is deployed on a Really we being technology engine the so launched transformation in in we that time year. we operations We at as of and our areas. continuous

reports team I'm and and putting we're something that's so lot effort in that it. directly on it, focus involved very so me, a of And to

flat long term, customer the, O&M think that we term. areas low and for invest need inflation, can maintain a absorb from keep longer we perspective So our and our in bills the is growth ensure to to it, we call absorb goal roughly

a excited time lot about of it. but something we're not easy we on. So spend Obviously, pretty

appreciate I question. the So

Operator

is with next ISI. Chopra Durgesh Evercore from Our question

Durgesh Chopra

change Just dividend I was trajectory interesting. thought the growth

the hard there Just thinking be You're bit a saying have flexibility X% your you Maybe growth low now rate. of just X% end would little that kind were faster, growing color financing helpful. side? of you the to because more so through more you gives on there, talk

Brian Van Abel

Absolutely. Yes.

we look fact our guiding the capital -- added we given to and the it. growth or X% EPS of dividend our growth, growth dividend above plan, base our was it, we're to to guidance significant that that $X to in conservative at of as it lower the and top we thought end X% X% decision still to growth within prudent right billion And So just X%. our our

the risks even we as this But helped at us you longer we look term, compounding the think over that the capital. of long when equity But lower financing for in high and term. reduce billion $X needed term, flexibility us impact with the prudent a of dividend powder long capital a feels gives financial reduces over that dry significantly needs longer-term decision like

feel We deliver have really feel [indiscernible] proposition very here return good good it. expect the we in to and really for investors, form. we'll about that we good -- a shareholder So New we continue total

Durgesh Chopra

Got the it. CapEx obviously outlined the adding opportunity more And be -- Brian, billion in CapEx. $X to Do dividend the could growth X% plan? could -- of a just Or floor? -- you is have there's additional as lowered further that expect capital you you're you you -- ton case of

Brian Van Abel

Durgesh, as time we I capital obviously assess chunk return. total think evaluate do shareholder of we'll it update have we all significant . or our regularly, a our of parts plans we if every

Durgesh Chopra

That's fair.

color last And on for steps the when is Maybe for And Marshal expect just just additional complaints there? thank other we updates? for just could one one key to Okay. are then Fire, me you us the what things. and watch the

Robert Frenzel

for Bob. support always. the Thanks as It's

and plaintiffs is I'd a have more week the We'll back a trial in calendar. bit of that the February, think moved meeting cases first schedule I new next better a got claimants fire, the to a sort of time. period give get With of planning little milestone of trial we sort change say given

'XX. some in we we much past a As -- do that, time we that. go discovery, into said, there's not expect Brian after Look, to trial

So to will month. we'll remain not same than everybody when other update the say there's facts case the more, the calendar probably the but we and know next early much on

Operator

with next Research. from is Fleishman Steve Wolfe Our question

Steven Fleishman

Yes.

is just rate commentary, wanted plan? your based So plan? I clarify the base that to growth all on updated base The

Brian Van Abel

update plan. Steve, $XX Yes. . Yes, the billion

Steven Fleishman

Okay. the being just from guess you feeling be risk manage Colorado how or to just talk able -- I any exposure pins just -- could it but in that? good And to about you're the on any could bad, and

Brian Van Abel

the and that Yes. folks to haven't commission a X Certainly, for Steve, have which of the asked PIMS, propose We close really been proceeding. to that couple PIM.

a for of construct think capital. whether under we in have the for Mexico, in So project those those And types we've and things cost we've a long time, to Texas, our a had of What's just Minnesota, that operated as has budget been. New Colorado.

We with within was a propose budgets a like a that so penalty plus a a commission modified band bit, X% it or for . Overall, incentive X% going the would PIM. we that above we sharing customers comfortable in put minus The or then given little it's PIM. and dead be that what sharing savings was and managing we're we competitive held our new proposed process. we good projects feel to and forward So

what XX%. the to as that savings rolling to the the operational XX% dead with overall company -- band. LCOE a plus a the of on minus That's the an the XX% it comfortable X% generally but adopted of costs X-year commission And it's modified have feel think Again, we average above, or it first -- bears on or X% customers, slightly PIM So it's proposed. PIM.

adopted PIMS if PIMS the that's the forward. very structure And our it, -- that view So manageable. appreciative we look that that commission put you -- we at

is have coming through the the in think as So then which working we transition we Colorado. fleet about generation opportunities CPCNs forward and additional commission to up, with our just transitioning plan we look

Steven Fleishman

Okay. Great. And The, Washington if on the some PTC. just line, time question. lastly, then I nuclear any, guess,

up what risk thoughts [indiscernible] if Your your want for on rules election any . thoughts on project. to and to the proposed hydrogen you that take means And

Robert Frenzel

very the of it's Washington, Steve, to on in fastball. our fuels that produce fun be We credit, stalwart was that needed active cleaner a in molecules tax we probably hydrogen particular, we clean were energy production molecule lot pass and could a probably part going that believe last we've seems been broader green felt talk a in On but to hydrogen that I'll position clean Bob. we one like very The economy. that attractive about, way. and are clean the of most as

I tax if for proud hydrogen proposal as or XXD expensive you, an we're country considered got to really in make are to draft in stall trying Harder to industry It Upper electrolyzer was Heartland on Midwest our support guidance We for be tell But economy doesn't and customers. deployment basis in hub disappointing. the States. to out United will It's hydrogen a in treasury a the our the feel of credit to hub. more fuel States. develop an United going slow clean it industrial the the

We expect to make comments.

period. Within comment the

We to comments. expect EEI make

We customers comments. to expect other make

have Is think fuels. additionality treasury balance basis it to a going matching. at produce cost-competitive hydrogen more hourly to lot and is with the I challenging to make other mean So going here. I a this to strict

So nuclear, Brian. that's about I on of our think kind we -- you hydrogen. go ahead, asked on are math And where

Brian Van Abel

in nuclear. Yes, I on chime can just

Obviously, value for use meaning how guidance you of -- is the here gross QX obviously, that an current RTO. advocated in looking we've for our is the the calculate the thinking. we're receipts, do LMPs, So in got we're we how guidance expect do calculate you given

guidance, forward that at customers. not have benefit ETR. kind earnings north curve, for we our we our look expect at look we would $XXX you if But our million Certainly, the into when of incorporated of

a benefit our it's that out something favor that customers. us and great for our we comes So we're provided comments hopeful in treasury because

that for QX. looking So

hydrogen. decade for now than expensive structurally on hydrogen than expensive more next the is the mean analysis on disappointing, Just comments significantly follow-up seen hydrogen hydrogen. blue Bob's more I've gray I and a green

green hydrogen And so market. it the of will development the depress

changes hopeful And some so the to to final rules. get

Operator

Crowdell Anthony from is question with Mizuho. next Our

Anthony Crowdell

think could Julian's the I and what When capital, quick above up you're to X% at you follow you or if math that's get ones base the of growth? high class and to to on in X% Just X%, cause all end, question. hopefully the Steve two would

Brian Van Abel

we Well, would I I we it X% I it. if to cause to it take X%, interpret But feel end at evaluate to to of right top Like conservative growth end X% is at that right the us or we're can X% long-term above mean, to question, the your off and go growth rebasing actuals that X% going is above right and place It's high implies or be being we're the the above rate. term? be now. long what to

Anthony Crowdell

Great. you're filing I think And mitigation plan a then I mentioned you year, later Colorado wildfire this believe.

a give you're in you is that? operation could once make I -- then -- filing? CapEx potential any mean, thinking for a also changes into us and Just you that or capital additional that look

Robert Frenzel

got I'd includes Good to say for that Bob. now. operating program and that, And various replacement. embedded hardening Colorado you modeling for technology in it's right plan existing under this risk Anthony, hear mitigation and wildfire that. Yes. thanks asset It's morning, within the pilots We're an solutions questions. and

that we're more enhanced reclosure everything enhanced from scale lot line power potential various mechanisms. would of settings in pilot probably installations and poles continuation programs deployment and to or reclosure and for across from undergrounding for opportunities PSPS more scale some on settings conductor and incremental business analysis around areas operational those the a to covered and updated be think I Colorado the maybe moving -- anticipating of of existing to coatings a deployment plan

Still finals. working on

material So company. I of will it's our in an deployment, Colorado don't to do but to I risk a think our driver reduction in be capital it going enhancement think terms be our

Anthony Crowdell

just plan procedure does on have mitigation accepted plan? And wildfire Bob, -- get do a Colorado that goes to you in a on lastly, approved just just or that

Robert Frenzel

Yes. at It goes intervenor through by the with a our approval PUC. regular testimony testimony way proceeding and

Operator

Carly with next Our Sachs. Davenport Goldman . from is question

Carly Davenport

quick some that plan highlighted. ones two on of opportunities you've for Just me resource the

whether in So should about first, or on to next on Colorado, in the obviously, CPCN the transmission think results. filing? milestones for just the just plan XXXX. the watch we that's that process around Colorado, transition strong How

saw 'XX. And then come X% just second the in overall We on to growth close SPS. in load

opportunity going can you of about potential that the just accommodate SPS future sort to forward? of in So the level context, around little bit RFP that growth a there talk

Brian Van Abel

Related we'll Carly. begin. absolutely, Colorado, to Yes,

just So for of will likely all over of you'll And to see them be probably those X-month way our QX. in on projects type of the file will market begin filter February. in to approval CPCNs And in late those filings. each starting CPCNs, probably think kind then regular then X- transmission I processes

the are just that Colorado the the least of coming those projects on out next markers plan So at was resource approved.

working And assets Comanche originally then we're the of just the commission And December. on the replacement and that was bit Regrets June. little on with focused filing this our transition in plan approving of a X no portfolio in

resources may the be additional opportunity that propose We think need even commission that there need those we opportunity they or do believe to resources. an may and we bring we there's incremental I resources. think the that acknowledges

follows just work So through a so of transition filing. line proceeding. part that Colorado that of months to time in terms plan all the be will And or again, that X typical

end that how -- 'XX those it 'XX, be type So would generation out But our into the in kind clean of excited are of at do Colorado by 'XX overall, it XXXX. fleet to as Colorado. pushes in coal will looking XXXX we opportunities completely of and transition

in region. see SPS. to On low growth XXXX, significant we growth expect in in to And sales growth SPS, that really opportunities you there noted continue sales our great

really SPS megawatts with we forecast. their electrification is the of is range working our I from to plan. our really megawatts. provided large think That If that a driver XX,XXX resource X,XXX customers around XX,XXX megawatts up

have significant plans. a anywhere it's think in that do I capital So opportunity. We our not

to the and make filing will officially RFP approve plan, Commission resource work summertime. and New then we launch we -- don't the look through the the but accept it, we'll So they Mexico in will that

And then we'll early XXXX and selection get working our on XXXX. in results later in likely start

customers. that in that electrification serve of making pretty and excited sure the our SPS benefits plan, excited we about So down supporting about can

like said, growth low fuel really I overall, serving -- steel fuel our seal opportunities in the So and low for growth for territories. great

Robert Frenzel

just that I X,XXX add new in and Southwest. the Brian Wisconsin on is to clean Midwest in RFPs said Upper Bob. now. are we comment represents if it's megawatts Carly, didn't Which the right the on what that's the remiss in of flight energy the in and RP Minnesota probably SPS

resolution remarks, those, our said as incremental I and expect deck. prepared year, included in capital of my We investor they're opportunities our in in this

Brian Van Abel

continuation transition in the Minnesota be feel the XXXX. just Minnesota our We'll by coal service And to as about across excited pretty in one add. our of filing down resource plan a all February in our plants shut I generation is opportunities of we thing just which a fleet more X, territories.

Operator

is Sophie with next from Our question KeyBanc. Karp

Sophie Karp

the that I guess, reading you I'm correctly. this Colorado, So ROE X%. If I earned noticed sub showed

much Just to that? improve what given investing is that? in Do And going you state? capital how to a the be you're see path

Brian Van Abel

Yes. authorized Certainly, we've a Colorado, in versus significant pretty earned ROE. gap our between had

customers Also to As we transmission from be through clean the that capital that deliver perspective. invest a will our think transition, through the flow recovery on of rider all that clean to that we all to flow the energy will the to need energy deploying TCA. timely we're able

have of to to the that it cost allows timely most customers which more capital, the lowest cost as a get of should in a capital we it long lost healthy we as beneficial term to ensure incremental it's -- customers important mean about term our recovery. utility competitive think the our So have that longer customers. to financially delivers because us I is cost

aware and certainly we're on. that something of working So

we in Our and with ensure over keep are policy ensuring we aligned that we the time. it clean and alignment Colorado how policymakers that improve that stakeholders around can and energy

Sophie Karp

-- problem lag more expect the was so with capital, which with right? [indiscernible] I . to speak, this So a you timing just improve to there Am getting

Brian Van Abel

Yes. gas And the the the Colorado as in remarks, filing mentioned, be lag. Colorado as it in case we we'll is my yes, week next natural mentioned had regulatory so. historic test We year a opening And gas. lag, in a capital or we here

be so And working through we'll that.

Sophie Karp

basing X% your 'XX. was or guidance volume growth 'XX for in other on was All right. in growth the to you're X% my question X% something And Okay. about your and overall company like

underlying you see So this the to and I'm do wondering there? what's acceleration assumption where expect

Brian Van Abel

in about it, hearing XXXX. continues to growth the our have work a and other what to their customers so there, and X% XXXX our biggest of Colorado I very coming data low customers down good we center with electrification industrial The We're customers, here forecasts as sense starting from X% obviously, large our even guidance and closely see So growth large with in we large we're of be is think driver beyond. yes, online. C&I online a some to are SPS and growth coming in the couple in

X%, But by that in really XXXX. So driven SPS. C&I C&I -- load contribute so roughly of growth in do it's have our by customer some. to growth, particularly We customer growth residential continue driven overall,

Operator

from next David Stanley. Arcaro Our question is with Morgan

David Arcaro

a credit question on Had quick tax just transfers.

cash the deck. contribute? level saw I flow Let's And the of the the of if that see. of course Are was prior wondering that versus you plan, increased part slide the anticipated it. CapEx the that ops did I'm kind changing given increased from here? over

Brian Van Abel

cash operations. credits isn't tax look David, because incorporated transferability all into us, plan, task the driver previous for transfer the plan. plan we transfer this the so transferability But credits when from the in we've in cash playing the new over we incorporate flow

$X.X you Certainly, from the a combination net taxes the driver it increased by to about of cash when projects to there's is -- Really, deferred book depreciation $XX look flow at cash billion plan. a some income billion X. billion ops $XX flow and all from

so Some about of as it. do go are in we they the projects and think assets flowing in good cash middle these service

so that that's there. why you And see

include transferability X-year do forecast. in we now our a that now From perspective,

I around transferability. prior, of billion we $X.X think about -- talked were somewhere I

billion Now the about we're $XXX of tax approaching roughly the of to transfer growing $XXX X $X about end million year, this X-year forecast. at credits over the million is years

see we have than the -- demand supply. actually and more our have demand So much

Operator

Miller Our Morningstar. next question is with from Travis

Travis Miller

thinking projects? dividend of any impact Wonder aside But opportunities. from that don't could and bit to needs on and to investment your after you you election of impact that. some little we disappointed, you've if set change those financing terms have, Does pursuing obviously, I'm kind these the other on in how RFPs your that's added into do talk thoughts. growth, capital capital of of go next this get and the hear going the more a

Robert Frenzel

question. that it's customers. Thanks Tavis, the for to want own infrastructure operate Bob. really our the We and serves

of this is customers. skill I core competitively set a think do think We for competitive. price think the company. we're We we a our can

energy value and over proven delivering from we've that X the our to think our last X clean customers or investments. years I

billion our installing of included -- I last avoided costs and in. pro our close wasn't which benefit in into was think think forecast in when over our total but estimates, of credits the years from farms wind X the is system put we $X to for our worth customers, our never those original fuel tax I forma wind it

So us our that there's customer to owning for through real stuff benefit and passing customers.

making is own the to in and recovery our about the infrastructure. think important new you assets we into we the investment get timely look areas. as of new important want we As sure regulatory installing It's as really obviously, to said, future, mechanisms, generation the for operate us that we

to some think our I would processes, be good operate I assets, are And position amounts own to there going value that would those have to want our that we of generation competitive been continue to of likely we and ownership assets. be prove at But that to customers, to we've to recognizing target plan and generation that. continue our be think

Brian Van Abel

absolutely Bob's Yes. that just Travis And right. add

forward. commissions We and we have have been, we expect continue our demonstrate to so that be with to we're to going competitive and

deliver low-cost customers. electricity we continue to And to so our can

think from and we've will financial balanced flow just operations. equity capital and growth, -- from cash very and we accretive that a we'll standpoint, purely fund been open mix debt But fund with a I of about

So overall, we're to a our very deliver term. think shareholders for customers the longer comfortable be both our and for and in to we're with it I great

Travis Miller

then That And one other makes subject. Great. different Okay. sense.

remaining to are Assuming procedural either goal other closing there you any fleet? Texas, steps, that in accelerated XXXX your entire coal the regulatory, depreciation of approval get steps hit necessary to

Brian Van Abel

That was No. outstanding. No. one last the

excited pretty of it So assuming last we're settlement. the get the we approval PUCT one. about That's

Travis Miller

anything and Okay. necessary operator like No that? agreement transmission

Brian Van Abel

No.

Operator

with Ryan is Our question next Citi. from Breno

Unknown Analyst

couple A questions. of quick

the clarifications process? outside Is updates. and for settlement fire, the I In court there appreciate of Marshall there formal any terms of opportunity the

Brian Van Abel

as look, ourselves still and we said intend viciously very beginning, with we've from shares here Ryan, strongly But the process. defend sitting early the disagree today. it's we the in conclusion the report, to of

Unknown Analyst

given the challenges of plans? there over any terms Okay. derisk you'd Are and balance raise in sales operator asset M&A to funding to opportunities that coming capital contemplate needs And the years. sheet your

Brian Van Abel

Yes.

First, balance I guess with disagree I'd the sheet challenges.

we have one of think balance stronger sheets I industry. the in the

aware own. with M&A But So an don't we're we standpoint, we I from in characterization. comfortable that we're sit everything the on in that going is the with where now agree now Obviously, necessarily assets industry. of

Operator

with Our next question is from Ladenburg. Paul Fremont

Unknown Analyst

fire. Just Marshall this the quick there the amount question dollar on the any of claims on a at point? Is update

Robert Frenzel

the [indiscernible] Paul, the claimed suits, question. property billion. mean of it's haven't I said suits $X total excess in far . was amount the Bob. that as for of commissioner no update. any in But Thanks No, from liability the the the they insurance damage or as

Operator

question last from with Associates. Paul is Our Glenrock Patterson

Paul Patterson

you're wondering PIMs obviously -- seem How was the up know anticipated sort asked. to say, more on -- intrigued been deal seemed have with basically to on sort a at to question sort to meeting the It Steve looking of order it's directionally and be But in what performance-based PBR how -- stuff the questions But that we're there PBR PIMs with my they greater I the and was that? of follow like sort given depends that of think PIMS. additional on Fleishman's are. just early driven. I you they general. of you one positioned And Just it that and of

are sticks, you carats, PBR, could you not only also well And that these you potential follow do me? do perhaps but under perhaps see if

Robert Frenzel

Paul, little were I me up question. breaking bit, but you see if the a let understand

think PIMs broadly natural. recent And . Look, in the capital on about things Colorado, had like as you earlier, how the that ratemaking Given throughout portfolio. various we've performance-based cost I and caps broadly that. do Brian it's projects indicated feel that

the commission I worked with CEP we interveners think in stakeholders the part as that the of setup and PIMs Colorado. through and

was process productive. the an think had opportunity to I We propose.

don't it's certain I a material think appreciated a think our they in proposal. I move direction.

think project on an I entity-wide appropriate for less so basis. probably a basis. Probably it's and

terms a into been jurisdictions So of in read of I with incentive mechanisms capital don't where lot we've -- around Colorado a lot deployment. don't or I see other with

Brian Van Abel

a the there's the as with transition discussion. Paul, plan. work work Yes, just in We'll the orders, we staff on written certain

achievement. looking And there's of terms emissions around of potential PIM at In well-designed kind also the PIMS.

move So through we we on look time. as working staff . forward with to that

Operator

Abel very to Van remarks. I'd to over like CFO, back Brian closing you for much. Thank hand any it

Brian Van Abel

any morning. you thank questions. Have great all in a earnings our Investor participating Well, call team Please for contact this Relations day. with our follow-up .

Operator

That much. concludes Thank conference. you very today's

You may now disconnect.

Xcel Energy (XEL) 25 Jan 242023 Q4 Earnings call transcript