Cms Energy Corporation · NYSE:CMS
Cms Energy — Citigroup Power Gas & Utilities Conference 2008
19 slides from Cms Energy's conference presentation, Jun 5, 2008
Slide 1: Growing Forward
Growing Forward Citigroup Power Gas & Utilities Conference June 5-6, 2008 David W. Joos President and Chief Executive Officer
Slide 2: Forward-looking statements
This presentation contains "forward-looking statements" as defined in Rule 3b-6 of the Securities Exchange Act of 1934, as amended, Rule 175 of the Securities Act of 1933, as amended, and relevant legal decisions. The forward-looking statements are subject to risks and uncertainties. They should be
Slide 3: Consumers Energy Overview
Consumers Energy Overview Excellent operations Customer value Investment Responsible rate increases Healthy capital structure EPS growth 6% - 8% Fair and timely regulation Consistent strong financial performance Ludington Pumped Storage B C Cobb J H Campbell D E Karn J C Weadock J R Whiting Mio Alco
Slide 4: Customer Value - Fuel Mix
Customer Value Coal Gas Nuclear Renewables Pumped Storage Oil Purchases 2008 0.45 0.23 0.08 0.03 0.1 0.05 0.06 Consumers Energy Coal Gas Nuclear Renewables Pumped Storage Oil Purchases 2006 0.52 0.26 0.08 0.01 0.02 0.06 0.05 9,600 MW MISO 125,000 MW Capacity Fuel Mix -- 2008 Diversified fuel mix min
Slide 5: Customer Value - Prices
Customer Value - Prices 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr East 20.4 27.4 90 20.4 West 30.6 38.6 34.6 31.6 North 45.9 46.9 45 43.9 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec MISO (Mo Avg) 38.6 59.48 47.06 49.08 49.11 53.08 44.78 58.15 41.83 50.61 42.7 48.29 CE Mo Avg 34.86 37.28 39.14 40.14 45.07
Slide 6: Customer Value - Commodities
Customer Value - Commodities Natural gas 80% contracted for 2008-2009 heating season 66% fixed price Coal 99% of 2008 and 78% of 2009 contracted or hedged Multi-year transportation contracts in place Electric 100% of 2008 supply requirement in place 98% of 2009 contracted or hedged Commodity require
Slide 7: Consumers Energy Electric Mix
Auto-related sales represent about six percent of sales and three percent of gross margin. Consumers Energy Electric Mix Residential Commercial Industrial Sales 0.33 0.33 0.33 Sales Residential Commercial Industrial Sales 0.5 0.333 0.1666 Profit
Slide 8: Balanced Energy Initiative
Balanced Energy Initiative 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Existing Fleet with Retirements 7841 7841 7841 7841 7841 7841 7841 7841 7030 7030 7030 6702 6702 6702 6702 6702 6702 6702 6702 Existing Renewables 284 284 284 284 284 284 284 284
Slide 9: Investment Approach
Investment Approach Utility investment provides customer benefits: O&M cost reductions Fuel cost reduction Reliability improvement Efficiency increases Reductions provide headroom for rate base and equity growth Fair and timely rate relief key to achieving plan $6.4 billion investment balances affor
Slide 10: Utility Investment Plan
2007 2008 2009 2010 2011 2012 Depreciation 7.534 7.173 6.785 6.366 5.918 5.436 4.926 Maintenance 0.429 0.866 1.413 1.937 2.444 2.911 Customer growth 0.091 0.173 0.258 0.344 0.433 0.525 Environmental 0.107 0.215 0.278 0.368 0.517 0.669 Gas compression/pipelines 0 0.018 0.087 0.171 0.217 0.232 Electri
Slide 11: Average Electric Rate Impacts
Average Electric Rate Impacts Including $6.4 billion of capital spending -- average annual rate increases about three percent. 2007 2008 2009 2010 2011 2012 2013 Base 8.59 8.59 9.29 9.39 9.34 9.68 10.1 Base +EEI 0 0 0.19 0.2 0.23 0.26 0.29 Base + EEI + fuel 0 0.04 0.52 0.75 0.88 0.75 0.71 0.5 0.5 CA
Slide 12: Regulatory Update
Regulatory Update Electric Rate Case - U-15245 ALJ recommended $210 million vs. our $265 million Primary differences: ROE - $27 million Palisades transaction costs - $15 million Anticipate final order mid-year MCV regulatory out proceeding - U-15320 Gas Rate Case - U-15506 Seeking $91 million rate b
Slide 13: Energy Legislation
Energy Legislation Michigan House approved package on strong bipartisan vote Package now under consideration in Michigan Senate Major provisions Reform of state's electric deregulation law (PA 141) Limit retail open access to 10 percent File and implement ratemaking Certificate of necessity for majo
Slide 14: Enterprises Assets
Enterprises Assets Kalamazoo River Craven Exeter Filer City Livingston Grayling Genesee DIG Investments focused on U.S. renewables. Renewables - 939 Gross MWs Other - 224 Gross MWs
Slide 15: Adjusted (non-GAAP) EPS Guidance
Adjusted (non-GAAP) EPS Guidance 2007 Equity & Return MCV "Reg Out" Assets Sold DIG Restructuring Cost & Other 2008 grey hatch 0.42 0.44 grey 0.42 0.76 no fill 0.84 1.15 1.11 1.1 1.15 red hatch 0.11 red 0.04 green hatch 0.03 0.05 0.04 0.05 green 0.28 0.06 Utility Enterprises + Parent $0.34 To Go $0
Slide 16: CMS Adjusted (non-GAAP) Earnings
CMS Adjusted (non-GAAP) Earnings* 2007 restructuring set stage for utility growth. 2003 2004 2005 2006 2007 2008 Future 0.81 0.9 0.96 1.08 0.84 1.2 target _ _ _ _ _ * Adjusted (non-GAAP) EPS excluding MTM in 2004 - 2006 6% - 8% Growth
Slide 17: 2008 Cash Flow Forecast
2008 Cash Flow Forecast CMS Energy Parent Consumers Energy $250 a _ _ _ _ _ a non-GAAP b Includes other c Includes cost of removal and capital leases
Slide 18: Consistent financial performance
Consistent financial performance Fair and timely regulation Utility investment Customer value Safe, excellent operations 33
Slide 19: Appendix
Appendix
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