Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, and welcome to the NextEra Energy and NextEra Energy Partners' Q2 2023 Earnings Call. All participants will be in listen-only mode. [Operator Instructions]. After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.

to Investor conference Relations. like Rose, to now of Director would turn over the Kristin I Please ahead. go

Kristin Rose

Thank you, conference Anthony. for Energy joining Good NextEra morning, everyone, second and XXXX and quarter combined Partners. earnings Energy call NextEra our for thank you

Mark are Crews, Chief Energy With Kirk Energy; President and NextEra Vice Rebecca Executive of Executive NextEra President NextEra and Hickson, Kujawa, Ketchum, Chief me John and of Chairman and Officer Officer President Executive of NextEra Resources; this of Officer President morning Executive Energy; Vice Chief Financial Energy.

officers whom are Executive NextEra of & well All as Florida as of Pimentel, also Light Chief of and Energy President Partners Company. Power Armando Officer

our Kirk questions. executive and our then answer will overview team your provide of results be an will available to

during can Exchange Risk Each undertake the Actual reports We any because filings the or incorrect, any statements. results and call if update differ forward-looking today's the earnings be the based in forward-looking which any key news in forward-looking of call release not found of be and websites section the www.nexteraenergy.com made assumptions, and during and Securities accompanying and comments our the which our are factors will conference on latest could uncertainties. subject or of on expectations making to and do our Factors of in statements, are other with presentation Commission. www.nexteraenergypartners.com. statements duty this to discussed materially from risks current We assumptions

also includes financial presentation references measures. Today's non-GAAP to

financial reconciliations to accompanying information in information to presentation today's for the measure. of the non-GAAP and refer historical should slides measures contained closest GAAP You definitional the

the to turn Kirk. over With that, I will call

Kirk Crews

good and morning. Kristin Thanks

we reflected second Energy competitive of and capital leadership to earnings position. its deploy a leverage customers Resources solid results. NextEra as our for by grew execution record Adjusted Energy approximately benefit the for FPL in X.X% noble track of our as per share advantages quarter continued extend

Florida U.S., and in continues state clear economy growing that drive fastest has the to an growth underlying our As population needs. investment

simple: been bills exceptional. reliable, our For and customer Keep grid the affordable, years, has FPL service strategy

most recent clear plan our to visibility strategy. has well-established capital With a deliver agreement, on through with settlement this XXXX FPL

transmission investments, with led This quarter new to capital and a executed which capital distribution XX% increase regulatory infrastructure our greater plan solar year. employed last same the and than we in quarter versus

share As increased while We per by these year-over-year. a progress FPL's result, capital customer $X.XX earnings bills affordable. keeping initiatives,

efficiently innovation fuel We identify capital with We manage initiatives. continue and to embrace costs. through smart multiple reduce our business technologies costs. deploy We and new to and various O&M reduces run and savings we the opportunities that cost

long-term the Customers deliver including bills in these and among are best-class national well actions, is customer FPL its value benefit below lowest proposition uniquely positioned and that the extend to from Florida average. growth.

of track more Resources, record than ever. Energy remains as decade and constructing, originating, developing, operating strong renewables two as

on of new Resources quarter, strength earnings the by grew over This year-over-year. adjusted XX% investments, Energy

solid continue renewables and demand. see storage to We

and storage through expectations commercial approximately And renewable our to XXXX. backlog, stands to track megawatts first over projects call, our at Energy achieve roughly megawatts placed renewable Since operations. of keeping Resources now it's us XX X,XXX our development which added X,XXX gigalons, into on new quarter

supporting to be customers. eventually the of Resources and continue advantages, and partner industrial, hydrogen commercial all uniquely decolonization economy renewables U.S. Energy is power, of Given competitive positioned choice, lead our the and to the of

progress with at so we We the NextEra in are pleased Energy XXXX. made far have

And with in deliver have various our For over competitive on challenging to yet, headwinds. a expectations. our months environment we XX advantages macroeconomic and have serve we leveraged operated customers financial

with capital EPS have than executed well-established business, visibility. provides two-thirds plan comprising growth year, Energy's of well, delivering XX%. the investors of approximately half more With NextEra first growth the of businesses adjusted long-term through our Through XXXX both FPL

Energy Resources, to and shareholders. deliver growth XXXX. visibility advantages expectations are visibility our and create our on to providing our leveraging Combined, positioned clear through with adding for long-term future renewables At to competitive to continue value are storage we backlog, earnings we new our strong we well believe

With that, beginning to let's results turn with the FPL. detailed

the FPL net was this employed billion per second principal income $X.XXX $X.XX year-over-year. an or of growth For regulatory approximately quarter $X.XX XX.X% driver XXXX, of capital approximately of share, The of of increase performance reported year-over-year. FPL's

capital current to which runs to agreements expect realize four settlement growth year XXXX. employed annual FPL regulatory X% through our We roughly continue average in term, over

XXXX between FPL's year now expect were for billion we be capital capital $X.X expenditures approximately $X.X to and the $X.X quarter FPL's and investment full billion billion.

June months regulatory XX.X%. FPLs ROE ending will For the approximately reported purposes for XX XXXX, be

million reserve the approximately of balance $XX leaving we of quarter, used a with FPL $X amortization, billion. approximately During

Our capital projects progress to well. continue

As to quarter, additions our continues year-to-date bringing into FPL megawatts. total customers. placed recent alternative the the solar we solar plan, XXX site lowest solar indicated be of nearly megawatts the in effective cost XX-year our for in to cost X,XXX roughly service

last while generation two X,XXX has new us megawatts years, a current serve X,XXX avoiding With incremental through investments solar of fuel under years volatile FPL and FPL solar remaining megawatts add the Over to settlement of providing solar roughly commissioned XXXX. purchases. half the customer strong clean, FPL agreement, allow two over and affordable generation. growth, expects to

June $XX and little a of remain our distribution billion $XX capital our billion a approximately total we in to year agreement, billion generation four through transmission $XX in and $XX capital confident FPL of expect we original approximately as Of new are of timeline. solar billion. investing XXXX, to in anticipate billion with ahead infrastructure. plan $XX investment XXXX through investments $XX between to cumulative that settlement current of We billion approximately capital the continue Over our total,

solar enhancing distribution what propositions capital Our is customer investment well-established the by best are and transmission one value in executing believe the on plan and investments, we we is deployment of industry. and

the now to to demonstrate turn I'll growth. which continues Florida Economy, strong

while U.S. standing roughly delinquency which Florida's by to X.X%, X% XX% continues increase and created average, sentiment consumer is an the over ago. XX% basis private Florida Florida above to versus rate to new sector GDP XXX,XXX year. at jobs, decline, approximately unemployment year, nearly U.S. decline its remains past average. below has the roughly upward, and Over compared currently improved the mortgage compared prior year a to points the trend prior the rates year XX continues

sales FPL per period. quarter, customer year-over-year X.X% with the had the year comparable that had customer second by number approximately of increased estimate negative the a increasing on growth approximately quarter customers weather by During solid more impact XX,XXX slightly X.X% prior of basis. year-over-year. usage from than a We FPL's retail on average

quarter weather normalized roughly X.X% increased account, comparable driven a from prior underlying the continued into period, on factors these by retail population taking second primarily sales growth. solid basis After year

second dollars share, Energy Resources, $X.XXX or year-over-year. an in or quarter we're $X.XX XXXX per GAAP to of we're billion increase Now approximately earnings, share. $X.XX earnings Adjusted per $XXX quarter approximately second let's turn which the million $X.XX earnings where adjusted for share is per

Contributions Contributions resource. was increased our share. per $X.XX portfolio share wind declined energy large clean to in year-over-year. from investments existing year-over-year from new swing a decline mostly $X.XX per due This

trading our highest. share, facing customer in increased relatively resource XX to second The quarter. years, This the past and due business per on of businesses, to year the a the last by compared customer the over supply wind was year weak contribution while prior quarter $X.XX margins quarter from in contribution primarily our lowest record was higher

half reduced support half including which to costs share. higher of the reflects the due stage additional by rates. factors, is to renewable to All is other of new for costs support early decline interest share, development by This and other impacts as remaining cost plan investments growth earnings combination in higher which is decade. The investments of $X.XX $X.XX we to driven per part interest of impact per borrowing latter due of a new

storage to approximately a of Energy new the and adding megawatts renewables Resources had backlog. quarter origination solid X,XXX

tolls these which gigawatts, achieve service after our XX us quarter backlog track of on expectations keeps through development call, megawatts now taking into With X,XXX our over placed XXXX. into our new account first additions, projects to since renewable roughly

the months XXXX of six to are expectations within development our need to we achieve ago, expectations gigawatts XXXX only the years over already and three X.X midpoint expectations XXXX shared range roughly range. next XX XXXX to Having new the development the just and

of The pool XX arbitrage facility. quarter a we for this battery capacity contract this our existing to addition, available in opportunities is southwest monetize storage an country. in power pricing backlog standalone to of part first project wind signed with megawatts renewable area expected needs our storage and the be customers As the project rich growing our co-located serve

believe here. like including highlighted, many have we the XX deploying gigawatts we monetize of existing storage As to value more did opportunities we are operating renewables portfolio, our co-located there

are to excited commercial operation. bring into facility We

seeing storage renewable will risk and we renewables for demand forms customer signs chain long-term remain price of position demand by customer customers. and inflation, solid of see to power continue commodity we premiums, We a to be finally generation, stability, helpful quarter After in commercial the and our to period disruption projects. alternative expanding During pipeline which and trade policy believe of ourselves conversations. meet attractive economically underlying renewables across supply and significant are our of industrial

XXX is in a diligence with well our significant have renewable in gigawatts When positioned business our for is growth positions. queue our of This and current years roughly projects interconnection Resources pipeline, of backlog, we come. and development. in various of by gigawatts XXX to Energy storage and advantages stages renewable we roughly our of stage you for pipeline believe combine competitive Today, renewables early projects includes supported

hydrogen expertise we U.S. development smart stage we a renewables advocate opportunity hydrogen early penetration. customers development We also best-in-class for the and hydrogen leveraging the green would and serve remain the robust excited market that believe help position. our to continue increased renewables to Throughout establish about drive by policy quarter

green operations related progress that into an integrate also opportunities our of energy their serve and by needs. pipeline of would hydrogen executing green developing and our explore customers' additional hydrogen understanding potential We to memorandum facilities

as Energy this and growth contribute simply new could with the Hydrogen appropriate later should customer class, another into thought to begin all renewables, of translate our be as decade. to related additional projects and potentially regulations, hydrogen Resources renewables

to consolidated our now results. Turning

second $X.XXX of were to or $X.XX billion earnings quarter Energy XXXX, For the share. approximately GAAP attributed NextEra per

approximately adjusted second quarter. and $X.XX the adjusted EPS of recorded cents billion in Energy NextEra $X.XXX of earnings

primarily the interest from higher other corporate segment results year-over-year, earnings Adjusted $X.XX by costs. and by per share driven decreased

interest manage multiple rates proactively to continue ways. in We

First, the various has $XX billion mitigate in rate. of impact interest rate to swaps increases of NextEra future Energy help

agreement as in sustained effective reserve ROE amortization U.S. the Second, such to FPL a interest yield. XXXX offset has became September to year in which rise and X, the XX adjustment mechanism, higher Treasury due rates features its settlement on

productivity our Finally, yielded initiative annual improvement in on has run rate savings our million ideas. through focus $XXX annual continuous velocity over

years, Over the offset higher to last two creating savings costs. opportunities help cost interest

in account into As always, rate taken the financial interest current expectations. our is environment

remain Our to EPS expectations In credit strong long-term deliver each disappointed financial we our ranges. from year, are or XXXX maintaining results if and ratings. unchanged, the XXXX, not top able to end near we financial our sheet balance be adjusted will and time same at the while of expectation

annual we off average grow we our will base. our And cash continue compound at XXXX, to at our to continue per dividends a rate year, through EPS growth growth that to share per XX% in least adjusted XXXX at to range. operating above From XXXX, expect or flow annual XXXX roughly be expect

caveats, As conditions. assume normal including operating usual always, and our our expectations weather

turn to like to I'd Energy Partners. Now, NextEra

EBITDA for $XXX and resource. million million distribution reflecting weaker wind adjusted respectively, quarter cash and were available $XXX Second

rate to deliver distribution. expectations available positioned NextEra its on well run for adjusted Energy cash for EBITDA XXXX remains and Partners

quarterly Yesterday, up NextEra Energy distribution of Board XXX% approximately XX% Partners $X.XX on of Inclusive share unit $X.XXX distribution declared unit earlier. LP a NextEra from this has IPO. its annualized or an grown over common a per common unit quarter, Energy basis, since per the Partners per per year

of renewables of NextEra Partners focus Further strengthening well-positioned simplification this wind on Energy is become megawatts XX,XXX previously last the to and With assets. position to wind Partners is of acquisition sun. megawatts. its its as and our company. its the execute a Since The producer partnership solar electricity plan from earnings completed over portfolio renewable world's largest Energy XXX% acquisition, announced NextEra call, XXX approximately seventh

pleased this by this with sales process Regarding May sell launched Texas remain progress the plan, for Natural track simplification Gas is to the assets in we Pipeline year. and are later we our on the portfolio

the sales use Partners XXXX mean portfolio equity Pipeline Energy to NextEra pipeline equity eliminate the portfolio from three proceeds natural sale a financing. on Texas the gas planned near-term convertible the in together with to buyouts expects

than expect STX Renewables market to fund the pipeline require through Pipelines. Midstream beyond and our opportunistic not future and of issuances NEP other XXXX. EP the program execution growth Upon XXXX, equity X, equity the XXXX portfolio does successful at partnership sell, equity to under Texas

to detailed Now results. the

NextEra $XXX and adjusted $XX of million for and resource. declined respectively, distribution weaker wind driven cash contribution EBITDA projects available in million and large EBITDA for by resource. Energy wind delivered cash impacts $XXX available the quarter from million adjusted million Partners existing and second $XX primarily by respectively, swing adverse distribution a year-over-year reflecting of approximately The

of years, highest. last the the while wind This resource was record past quarter lowest-second over the XX quarter was year on

contributed projects adjusted New $X cash $XX available of approximately distribution. EBITDA million million for of and

poor positively quarter, and offsetting Second million benefit performance. of and Rights results impacted resource EBITDA cash were quarter of by the Distribution for $XX Fee wind for Incentive impact adjusted Suspension this provided available distribution the approximately partially

available half year Partners, to cash for XXXX. full of As distribution LP we shared, unit adjusted for Energy growth NextEra we and the expectations double-digit per range year previously distribution second strong in support the EBITDA and the expect growth

are details slide. Additional on the accompanying shown

quarter and of a reasonable common base of range to as and see at distribution through a From our XX% per expectations annualized being of year an we LP XXXX distributions continue XXXX. rate least unit XX% per $X.XX, fourth growth per unit to

of we we you, the near to previously end at or as with expect range. grow shared bottom However, that

of $X.XX For distribution XXXX rate expect per $X.XX a the that quarter be the to common in of XXXX is XXXX, February payable we fourth to range in annualized unit. of

be December the Partners ranges million for billion to adjusted run XXXX its to $X.X for continue rate $XXX at Energy portfolio to and and contributions cash billion $XXX $X.XX in XX, expect to of available forecasted EBITDA respectively. million and distribution NextEra

XXXX As XXXX. run year-end year year-end reminder, reflect the contributions a rate calendar at from projections forecasted XXXX portfolio

our our caveats, conditions. normal usual expectations operating to As weather always, including subject and

the value holders. NextEra In Partners the growth extend long-term unit summary, shareholders. At our is our to are transmission businesses shareholders are delivering for and on capital two benefit value of we NextEra we're visible At Energy, simple: and well-positioned Energy customers which plan, believe providing to plan executing investment Our that continue Energy us capital renewables and and for FPL, opportunities NextEra customer for well-established proposition. deploying allows

significant deployment and the into costs business investment more NextEra running of business visibility and strong manage and smart provides population drives growth both allows capital benefit the FPL Florida’s than comprises customers shareholders. and Energy's efficiently for us of of to growth. a amount two-thirds capital earnings

advantages than We we're providing roughly eventually Resources, and to years serve our Energy Energy terrific growth add our to hydrogen At XX these experience, enable share grow and XXXX. through industrial, competitive leveraging our commercial market more of competitive advantages to now power, will believe backlog, XX and customers. visibility Resources gigawatts

partner toward to gigawatts billion potentially XX investment, hydrogen of decade. opportunity the Resources an $XX new set be green of capital more renewables, end new With of of than is well-positioned requiring of Energy opportunities choice, creating the

Partners the business. pipelines are gas Energy simplify NextEra our At to our on sell natural we and executing plans

over portfolio, storage and renewables our to which XX,XXX add now to continue megawatts. We stands at

be year, continuing on by With Natural of the transition of remains Partners to for pure Texas unit to XXX% distribution NextEra while growth Energy renewables per Gas a to the company, holders. end unit the to expected completed sale deliver portfolio Pipeline the play LP track

that, we're answer questions. With to happy your

Operator

[Operator Instructions] will question from Fleishman first with Wolfe Steve Our come Res.

go may ahead. now You

Steve Fleishman

you're all hey Yeah, Hope thanks. well. morning, good

continues business and to on mentioned So supply margins. the you higher customer do just The a trading first, couple quarter. – well

that just talking about talk been think supply that you think I is you what Constellation more business? the about in has too. driving Could

John Ketchum

trading a do is lot number seeing lot And In activity of business morning to competition, less number the and Ketchum is two, we’re sure group a as Yeah, most supply Steve. that well. the customer a you remember, that of in and – business. John we just one. business, customer This good facing

up to business where manage ancillaries business, we're needs other capacity requirements cooperatives and with East. North for need particularly the in and full their example, provide requirements power arrange to working Our and municipalities and the regulatory their help that

it's that And them arrangements and positions. are into those significant these please, know back back, to competition, less to points going requirements it That immediately at three lot enter want one is, we has typically I business, because the hedging benefited full or of two a in from margins. business make years had the you we're

great again, skill about up their our feel with well profile, margins terrific sets, that risk the competitive So match and and advantages operations. really our core

So that's driver. the main really

bar. I run it about And that a to also supply low business and very, customer want very folks remind think we when you our at

For ran example, we roughly the bar. X% that quarter at business last a

for So risk it's business, small very, overall exposure very PMI.

Steve Fleishman

Talk] on… next [Cross just Okay, question

John Ketchum

that XX% can customer a one never and well. than the point of more Steve, has as supply that keep XX year – on businesses. make I supply to Energies business contributed including you well. mind and lot the We think done years Obviously, is business, in business, customer complementary to income run and trading too other that's important back this I historically a NextEra has FPL net go have we of want

have of Energy under our has rating that's make the agencies, other that stayed to of But renewable and as always and true complementary XX% on year one business well. commitments the We that businesses this Resources top that's that business. we

Steve Fleishman

Okay, great.

of the just Thanks. color Treasury, the on hydrogen, both timing hydrogen like they in latest key issues green kind of of year and any rules are Just maybe from where matching hearing on the additionality. some

John Ketchum

have hydrogen us have matching. use we day with the annual of And than as everyone for hydrogen simple, probably that debate a been the electrolyzer capacity a part come matching is of very for need which factor, familiar hours we whether or between that are less and number that those matching, asset buy half parts it, you a that are you expensive very vocal been together country. in if familiar project electrolyzer, it's with. Yeah, most to you net of the the around regulations day an hourly the an hourly there's called And have

If expensive that it's capital is going green lot than only lower asset have to electrolyzer easy half mean, you we're an an can of the and able have when be a use and I use price hydrogen if math. use to you annual so less really you around clock, around the it the construct, clock can time. it you a

construct have would proposal, And industry a XXXX. with very has so until matching the forward come kick which hourly the in constructive not

until that you have we to have have to going time fact have also if for supported You’d qualify that period the go and annual additionality you're annuals.

So the if and annual shining you're not newly Well, electrons you're been an behind has the is are asset the renewable the the hours constructed that off qualifying that in from not wind electrolyzer hydrogen or power, for the to facility. the you sun buying meter and that blowing developed additional built grid. to buying is provide

getting you're perspective, NGO additional an decarbonization grid. on benefits from So the

So have scale important, prices electrolyzers OEMs up we hydrogen being time. think right what we price signal is produced because to with. send going green come on want in at to been be production to We important we've because in the think forward ramp very electrolyzers, critically constructive really we declines it's to to over

in your so terms where we that's around question And timing. are of

but starting with We're to to Treasury probably sound expect now. October. We come September regulations it's or for more like hoping out August,

land of and hydrogen gigawatts over well that the work land aggressively we've billion we built it team that in diligence up positions the and lining it had and have sites. out, out you pipeline, pipeline said significant pipeline Kirk include now But hydrogen thing that construct which we about due them XXX is about when that parts remarks, very portfolio for early either $XX again, nice our on is a the have and

sell terrific like customers hydrogen has just Nobody used a nobody, about dual what's a it purpose, for that, is in to. to third our be class industry and it can pipeline because are customer renewables

our it power work for site if doesn't or the C&I So customers. work hydrogen, for will

for really really hydrogen we're already and you. development expectations the positioned laid well like to feel we've that provide I those can of out nice is So one boom that a things

also eager a hydrogen final development of has we're to see latter cycle, regulations see expect I contribution the hydrogen want so over what that to we'll would you the that the folks say. investments decade. remind part So the But long from

Steve Fleishman

the Okay, last sale. question, on just Texas

expect When to the transaction kind end. need to TransCanada, I you said to down, we to know you. done year-end need still get valuation So you in data of the just views think sell think points when announce on year would expect Columbia how the energy. but I down, should they're it of the or make by sell or like you'd of and about that, context just recent different the we've TC assets, co-point. and Thank would seen

John Ketchum

Steve. thank Yeah, you

take me let So those in order.

of that in have the the terms be of end in to end support timing, to earmarked. year early quarter third we in the a we quarter So that sales fourth or hope order would in timeline of position,

In integrated fully natural players. if other terms very, as through a provide a Again gas number look and pipe, that very to Mexico, around trading the of the of these and Texas liquid valuation, for of that you And are that provide strategic we which pipeline area, are view assets point. a they these assets through XX% pipelines Texas contracts (inaudible), to the Pemex, as very with is with the support Mexico pipeline gas reminder, unique. supply

pipe as that another, all compare the know, the but again, pleased sales again, comp one on progress continue it's to transaction. we you to we remain with So hard make to

Steve Fleishman

Okay, great. you. Thank

John Ketchum

Steve. you, Thank

John Ketchum

Steve. And Oh!

on said the correct meant X% bar, I the think I that. on you. PMI, $X for million I just bar Thank

Operator

come Pourreza will with Guggenheim Partners. from Shahriar question next Our

go You may not ahead.

Shahriar Pourreza

Hey! guys. Good morning,

John Ketchum

Shah. morning, Good

Shahriar Pourreza

Good morning.

see assets especially a you're for to still guys right? at your either as some while competitors, in of have opportunities type just, supply of chain of financing noticeably. platform position picking latest Do seems leverage the sort be up developer improvements yours, or transactions, look Let existing the of NextEra in we what seeing and books, with kind given renewable kind portfolio to any come fairly valuations you me

Kirk Crews

valuations that assets just see. But, details and mean, mean, sale. I into come not those assets. all – I you look, not are if you are. of the of be the on I'm going to the the first we the that high I me think on of comment lines to critical characterized quality that of transactions, structures those some have as let read renewable through Yeah,

benefit at XX around from look, over are look transmission of to have experience, and They assets. we wind the resource, the what back of have same mistakes years we renewable make. are last like develop our believe congestion, years developed analytics high XX in you credit I When make high quality are what other of counterparty are bar. Because of continue bus data perfect, very situated to don't you we Most that them we see well off-takers. we solar They some with developers are resource. some areas and the that but

I better we're so positioned. like And much feel

Our portfolio you some that is have in much better of seen. position other than markers the

assess portfolio be very, very, portfolio, because how different. you are they So very careful to on very I'd

advantages, third-party at opportunities what second have feel The we advantage. thing would have the we know cheap, we like look We do say that some I operate cheap, a competitive build we buy we all is, all mentioned. of M&A cost-capable you and we you cheap, available come

We the the assets, understands how existing that to value piece. have key a really terrific that's team of optimize

benefit Kirk don't. else mentioned largest on that operate. that the as call that us up gives always we've terms North being And is record real asset America in have able nobody a something others an leg has the a with is then we organic assets and Repowering something has, industry that rest fleet that at. very which of the today, and of to It’s strong values track struggled see in the a we had

not the take repower ways to pair existing find the to storage with only assets, those And have ITC. so storage to we advantage but of stand-alone ability up them and

rules know, storage all used with with The pair change only the stand-alone you opportunity under to unique be of IRA. a to ITC storage solar. As

in of making pair We're a build now progress with wind, can a So we lot stand-alone. that we area. can it

We seen in today capacity are happens announced reliability priced those project given where to is. the what and in an our with wind are markets that starting SPP, and in just past, that of and to we've they one MISO of have where some coincide particularly opportunity, than being see we ERCOT, in most higher values where the shortfalls them

existing existing very And those solar fleet have, or industry agreement, them go start two-decade our we assets we that and includes interconnection massive to given this the given pair the up unique have. ability an to which importantly with head is in repower that

value including our other a well cost-to-capable to as that's exercise M&A competitive we try to we bring so And when opportunities our advantages, that advantage.

Shahriar Pourreza

of Perfect. to it. Got Thanks. focus And sort disclosures? around indicated a there and the the for in settle? been is Any been case updates hasn't opportunities of stances of it but quiet really John, it's change any a bit lot FTC little a by investors, as today? Any

John Ketchum

have the first you question. back sometime the quarter investigate, and would expect we should news no XXXX. in on that that hear a historical for based there's we would precedent new there. new they really Shah the probably with thank Again, belief FTC of No they reasonable developments Yeah, just where

Shahriar Pourreza

Perfect. appreciate time. for I you, the Fantastic. it. guys. Thank Thanks

John Ketchum

Shah. Thank you,

Operator

Our next question America. will Bank Dumoulin-Smith of come from with Julien

go now may You ahead.

Julien Dumoulin-Smith

guys Good Hey! John. Thank much. Good morning morning Kirk. very you

So I the to wanted decade cadence to come conditions. backlog back the the to into

against the bit what out kind at, first terms the about you bucket nearer ‘XX, versus ‘XX ‘XX, sense to of looking that there little here? execute execute in the ability talk versus you're latter of Just to seeing term a there. ‘XX in Can

hand contracts little about the How especially And that have do close-on us already? give and here, a years towards later maybe what the IRS on update of stand to now maybe where in given especially, commit clarity an on bit to that there, the we willingness just transferability, think you etcetera. that means biasing you for

John Ketchum

Julien. question, Yeah, good

just knows ‘XX. – development our everyone in are me expectations take start because ‘XX to with chunks, let So that

let's So we'll about just the two talk first start second with the two years. and years then

‘XX in great shape. for we ‘XX, through So are

us you to as know are we up we've the we within ‘XX, ‘XX we XX already had kind and and and in to then the great of if puts added gigawatts already gigawatts because XX last get have you on ‘XX, the if back from gigawatts. XX quarters. six the ‘XX, And now today, of ‘XX, are that's go backwards expected We to years shape add you midpoint where beginning you be. just work That ‘XX in against range and get X.X to to

like see tailwinds on position think I renewable your in explain and in forward seen real I dynamics, are was industry, which on some and want come that track we And build. we just of we've feel some So know Julien. you the really start question we're what there's around part to to great that to going

the delays. are It prices Let's of ‘XX we cost for developers lot because panels that could some and scrambling chain also up. we that I drove just a ‘XX. cost then us they saw time outages I which flip, a circumvention in back of into issues surface. for saw And country, we that to thought here get supply started go to supply, they them saw short think period a mean,

to good commercial market. COD waiting those because are in are and The customers is, news projects ‘XX now go XX were coming those projects all to ‘XX into back great really thing customers, digesting go that starting build the those now a that to That's delayed good that operation. news, ‘XX to got to for in for

look to folks strong we so seeing from forward. start really demand And those as we're

The flip so finally seeing back that around six, of into see of start get seeing that lot meet front. that that bright you is we're not six-part as you with circumvention, We're the a we awhole account as you through. to clarity work on works you're to test four flip this of see, other we used benefit and that Asia, importing making When as from take okay. up, you long progress have line you now rule Southeast you we're the that with and the you're as

we've result that. seen relaxation And in is pricing so as what of a a

year market premium to by risk that the import last was now So down. the being come starting is charged

they part for want everywhere of price right? roughly risk the but They've in U.S. selling starting around the U.S., sets wants They pricing for U.S. that Southeast market? really been panels part The of is seeing come that price $X.XX Asia else, market. other panels terrific a premium solar down in that sell big U.S. phenomenon Asia for panels the is Southeast the we're and a do Why to the still big as $X.XX

they a move. have lot to of room So

come And so new with getting flip At as also around, that forcing are lot risk online supply premium that will you it. come more the and comes U.S. time down prices the seeing a announced, down in cell you're through module same circumvention along in through U.S. facilities facilities is

as come the from because lot particularly time, when that so of at favorable line evolve. over capacity to an picture, And think is look solar is the force equipped starting down you a going online U.S. see the you bottom it's you're see I price prices standpoint, to market

got need they've And and to positions, of it's to things they that with China no of pressure so batteries of excess panels Asian capacity, are do capacity some some economic Southeast those out secret with. with the and markets under find coming data

prices coming down Battery as are well.

seeing really market starting see around EV we’re finally struggling battery in China, – relaxation Really in capacity struggling to in the so very created finally in there. relaxation batteries We’re prices. and to which much see a some has excess

think a battery so there's forms, of there, around traditional there. see rare other about and landscape and very sodium lithium and movement exposure been you encouraged the of ion the some I more mineral

reap domestic And can incentive. the the full full wind then content on folks the really wind benefit only manufacturer one the are the that of OEM of side, ones and

where So well. we feel really as sits wind good about

So ‘XX excess combined start through coming online ‘XX move started come capacity we globally chain these the great in you we supply and of these in saw as to I projects issues look around supply with to think chain, forward feel you there.

of let the transferability and lot be going in of discussion FFO about me the saying, for of well, it questions heard how to part is And about a FFO-to-debt is a to accounted talk second. and I've And folks a be metric. There's lot transferability been going for?

good good line has heading told GAAP, good around end in time through with tax feel that for up that that get included We transferability. it accordance investors that surfaced place good be flows is and very and feel about question a we that in and so to where very will FFO-to-debt the on that transferred, that feel a there credits we've we for it's long tax

headwinds about anywhere. as all worked going getting So we of to when good here Renewables and together, they're just feel you put stay, very started. it, these are some not had, those let's pieces heading are we've we've through we're that where things just face

process optimistic feel isn’t shape straight while we're in know and might future. the you going be so terrific – always the about a we development line, to very And

Julien Dumoulin-Smith

a contracting that do Right. could back quarter more versus trailing about point the you that feel into would John, of I Thank of about in of the like time acceleration to very in trend see half? if dynamics though, points just the an you kind that How quarter. something talked you will the uptick itself. really that you kind mean a you just you of lot versus on are real and actually lot made was the here last argue

John Ketchum

of going I online said and Yeah, on, those of these come a that to depend projects before, ‘XX fatigue lot speak. bit it little in a as is to had XXXX continuing so customers to

starting But and are to those coming about market of We feel to card. that rest year up. which how shape back delays the to we're be so the we will around continues the see good wild

Julien Dumoulin-Smith

All you sir. tuned Got front. excellent. right, stay Will Thank it. on that

John Ketchum

been it C&I been for there stress it's sector, renewable. to to mean It's things two We the add the I enough. get sector. I and had the of it’s power one rules customer Julien, right is, And again that always we've hydrogen. classes only can't

class, and is exciting Now have with right to third the which that's customers for add the as potential rules, renewables the we customer hydrogen well. a

Julien Dumoulin-Smith

Maybe stayed get flow those class. that or after customer a so through see you third Yes, you’ll quarter two tuned. that in rules that really

John Ketchum

development that's remember, those have Yes, cycles. lead And longer that right. I projects then time think

going decade. the the latter the So part expect, of contribution of come it's in in to that investors should terms

Julien Dumoulin-Smith

you. Thank Excellent!

Operator

from will Our next come question David Arcaro with Morgan Stanley.

ahead. You may now go

David Arcaro

bit morning. outlook, at wondering, – need financing Good question. know I to taking NEP. you latest a you on any time thoughts could I give terms just equity so little was my for I shifting projections don't some to longer Thanks of the if you in But alternative financing here. Hey! hit was know don't NEP. for you Maybe approaches term wondering growth much

John Ketchum

that strategy Yes, that a the is, execution assuming XXXX. on don't I – shared equity mean focus for NEP, ATM as opportunistic back sale, have market to first to growth simplification our we know the don't expectation XXXX, on equity of successful we said under which you help that in May expect that result the and with a our other than of requirements we issuances beyond we have in all is finance

the and with under add in that look, call if lot have you financing, would the market based forward. growth see current to flexibility I terms to can But a of accommodate what in we the you here, debt agencies, ability additional, capital going of slides traditional metrics the our mechanisms

are focus. well. be on we some to the next we going transaction, point around have are Because the those going ideas at from to we how back looking simplification we busy the of and move And that sublets address three as very when that's end,

we're We are – not not waiting. but

to continuing look are at that. We

bid development, in competitive leader the very NEP in there term. forward, continues long with the gigawatt opportunity XX do Particularly has log. strong an about visibility renewable going have, interest be for growth that promising. And assets look, backline advantages to the a interest, the renewable all think we with The world to that you in when renewable that

could so as about well think to engage discussions in And we we continue the future. those as

David Arcaro

the thanks made And wondering question about I then comment a it, the to with had could place. that position, do into for long large growth speak you seen was that or growth transmission very to visibility the Got it, just you've transmission any do that you queue in potentially you that and think we've point if gigawatts. that be the color. at constraint you got also interconnection related XXX how in challenges a massive just could or term gotten on for the hitting have a constraints queue targets industry. industry But much

John Ketchum

that I XXX mean that XXX the that two me the with challenge in capacity. pieces. gigawatts with that gigawatt take we would let one number even has to already projects that the XXX you David is pipeline anybody I in around position of interconnection so industry to have, the have, find secured. reference you Yes, and interconnection that close

not interconnection in market, seeing if And Finding don't have with hard site forget, part. capacity, now customer the the ready a you the given go hard we're that's is part. the the right demand to

a our just and today. right track is focus on early that terrific that's I there such sure where so And we have why making we on feel about program development stage stand

is take me just have the in so Let second you general. transmission piece, about that which

are We not waiting.

issues interconnect we are doing Energy We and NextEra taking our the transmission own and transmission. are hands in that through

around We be where are built. going focused assets going renewable our transmission competitive are and where are they laser out to build on

going own we're not our intend business now evaluating. board taking transmission and a for game, into problems on the ISO. have going we bottom solve waiting. announced to in quarter, is right million hands, other about message not investments we but I'm That's projects, number of That make we the GridLiance. again, continue a go line that opportunity another We're terrific bought Cal space we is We various taking $XXX why the we are we last project talk today, them ourselves why to that investors those to in as along. we're that’s that and

David Arcaro

helpful. color. Excellent! so for all much That's Thanks the

John Ketchum

David. Thanks

Operator

Davenport question next from Sachs. Our Goldman with will come Carly

ahead. You go now may

Carly Davenport

Hi! taking questions. Thanks Good the for morning.

in in supply question. divergence back the chain of and supply to wind chain just go between change and But from relative a projects thanks commentary versus recent rate perspective to quarters, to earlier for any projects? seeing trends the the terms are of wanted there you solar Just

John Ketchum

projects, make of just terms we all almost of I businesses I a mean with wind couple do mean let me in there. our GE. of Yes, comments

I been some We to have want turbines Siemens I on little of Gamesa know press and Siemen’s with a clear. very make have that Siemens bit in any just recently. done the We don't our there's fleet.

on hopefully ultimately their get and they kind to through know hope and turbines wind we'll on the remember to a be what customers around things supply are almost so that manufacturing there away content. to and information of domestic things, giving beneficiaries Treasury, which chain secrets in versus made all they'll work couple have to share margins terms the incentives out and exclusively of about with they but solar, have us continue you of think issues. U.S. the They we with wind in work they we As direct of paperwork have those those

But deal expect back wind issues as around with things the that around and said and us not just buying ‘XX doesn't show have ‘XX industry in But well, we in been to more on our working markets that all the starting through you now I had only a issues other those the earlier, same to capacity those in which really power are capitalizing solar the plague you again but opportunities exposure solar. Around so have do. as we're up, see flip, the been circumvention. in we've we've U.S., and would in in as leverage lot

Carly Davenport

continue your talk costs needed It perspective. on available about to like to starting high improve from challenging and just still Great. of level of one what for kind then seems at to if it's is an but bit, environment a you kind a this levers cost how the exist Can a the And to in managing earnings execute just are many. that follow-up environment. That's pull quick helpful.

John Ketchum

Carly. Yes, thanks

years our Velocity one on $XXX last name been and if you two there look we with program from of both of last under this. come spoke run at every in called year through had units. fact, savings that over company. company. we've I we identify process we've XX we a And and run Resources. years, success at for we So, last our year bottoms-up year ran to the business savings that Energy savings This the and last we in how amazing initiatives, to million FPL it, at It’s cost We ideas cost able over same the and – cost call every it with the challenge our about know a you're initiative

So it's of the we're constantly whether looking for it's ways to continue out G&A. OEM, whether to cost business; take

We is that piece as to Technology able think to around as XX the a how big massive we And a have technology? build never run it we skills also leveraging years all generative well. terms business the we've technology, that recently we last over program been AI leverage we to do really XX launched in well. have of in of a way the AI leverage that we how

are focused going to And I contribute so we're the all business, think cost on a laser those for cost. things to over but declines time

advantage. when building next you're it commodity, our those our our program. business, you feel buying share of minus all developer to than position, development competitive be about to together, And we we better the cheaper, progress cheaper. continue line A When how terms to put cost know selling terrific the the then balance And we renewable in great got we market development a to electricity with in you gain sheet, operating financing capital equipment cheaper, things inches, and cheaper, it have

Carly Davenport

that Thanks color. Great! for

Operator

question-and-answer concludes pardon for Thank now Our me. next This The concluded. presentation. – question has our you conference attending today's session.

disconnect. now may You

John Ketchum	Chairman, President, Chief Executive Officer of NextEra Energy
Kirk Crews	Executive Vice President, Chief Financial Officer of NextEra Energy
Rebecca Kujawa	President, Chief Executive Officer of NextEra Energy Resources
Mark Hickson	Executive Vice President of NextEra Energy
Armando Pimentel	President, Chief Executive Officer, Florida Power & Light Company
Kristin Rose	Director of Investor Relations
Steve Fleishman	Wolfe Res
Shahriar Pourreza	Guggenheim Partners
Julien Dumoulin-Smith	Bank of America
David Arcaro	Morgan Stanley
Carly Davenport	Goldman Sachs

NextEra Energy (NEE) 25 Jul 232023 Q2 Earnings call transcript