Nextera Energy, Inc. · NYSE:NEE
Nextera Energy — Wolfe Research 2022 Utilities, Midstream & Clean Energy Conference
34 slides from Nextera Energy's conference presentation, September 2022
Slide 1: Wolfe Research 2022 Utilities, Midstream & Clean Energy Conference
Wolfe Research 2022 Utilities, Midstream & Clean Energy Conference 1
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results These presentations include forward-looking statements within the meaning of the federal securities laws. Unless otherwise noted, the forward-looking statements included herein are based, in part, upon federal and state tax laws i
Slide 3: NextEra Energy is an industry-leading clean energy company
NextEra Energy is an industry-leading clean energy company 62 GW $164 B $152 B In Operation(1) Market TotalAssets(3) Capitalization(2) Clean Energy Generation Portfolio Integrated Supply Chain, Engineering and Construction The largest electric The world leader in utility in the United electricity ge
Slide 4: The Inflation Reduction Act ("IRA") – Potential Impacts
The IRA significantly expands tax incentives for clean energy, driving growth for renewables through the next two decades and further validates our Real ZeroTM vision and strategy The Inflation Reduction Act (“IRA”) – Potential Impacts Over two Unparalleled Co-located storage Manufacturing decades o
Slide 5: Attractive renewables economics driving transformation of U.S. generation fleet
Attractive renewables economics are expected to continue driving a transformation of the U.S. generation fleet Estimated Costs of Generation Resources Late-2020s(1) ($/MWh) Near-Firm Wind Near-Firm Wind(2) $14 - $21 Near-Firm Solar Near-Firm Solar(2) $17 - $24 Existing Natural Gas Existing Natural G
Slide 6: Rising power and gas prices and demand for RECs support renewables deployment
Rising power and gas prices and demand for renewable energy credits (RECs) further support near-term renewables deployment Market Prices for Renewables Alternatives(1) Forward Power Prices Forward Gas Prices 7x24 ($/MWh) 7x24 ($/MMBtu) $80 $8 ~50% ~55% increase in $7 increase in 5-year forward 5-yea
Slide 7: The impacts of the IRA have further improved the competitive position of renewables
The impacts of the IRA have further improved the competitive position of renewables Market and Policy Impacts on Levelized Costs(1) Changes in Levelized Costs(1) $/MWh Comparison in 2021(2) New Gas-Fired Unit(3) ~38% ~41% Headroom to Headroom to Gas-fired Gas-fired Existing Generation Generation Nat
Slide 8: Clear and visible set of growth opportunities to lead decarbonization
NextEra Energy has a clear and visible set of growth opportunities as we position the company to lead the decarbonization of the U.S. economy Our Vision (2022 - 2025) Largest, most profitable clean energy provider in the U.S. Best skills and capabilities across the industry • Deliver outstanding cus
Slide 9: Clear vision and strategy to extend leadership in the U.S. clean energy transition
We have a clear vision and clear strategy to extend our leadership in the U.S. clean energy transition NextEra Energy Decarbonization Strategy Decarbonize Decarbonize Decarbonize Ourselves U.S. Electric U.S. Economy Sector Lead by Example Replicate Our Success Leverage Our Leading Platform Achieve R
Slide 10: IRA expanded the opportunity set for repowering wind and solar assets
The IRA has expanded the potential opportunity set for repowering wind and solar assets, and Energy Resources has a proven ability to successfully execute repowerings Renewables Repowering Opportunity • Proven ability to successfully Energy Resources Opportunity Set(1) execute repowerings (GW) – Rep
Slide 11: Operating portfolio is an opportunity to co-locate with battery storage
Energy Resources’ large operating portfolio represents a significant opportunity set to potentially co-locate with battery storage and qualify for investment tax credits Battery Storage Opportunity • FERC Order 845 allows storage to use surplus interconnection capacity at an Co-Location Opportunity
Slide 12: Green hydrogen end-uses more economic with $3/kg hydrogen PTC
End-uses for green hydrogen are now more economic with a $3/kg hydrogen PTC and even-lower cost renewables, potentially opening up new markets sooner in the U.S. Green Hydrogen Opportunity • Green hydrogen unlocks additional Applications opportunity to build new renewables beyond traditional power s
Slide 13: Leveraging playbook and competitive advantages to drive the U.S. energy transition
NextEra Energy expects to leverage its playbook and competitive advantages as a world leader in renewables and storage to drive the U.S. energy transition Long-Term Industry Growth Visibility Florida Power & Light Energy Resources(2) Solar and Energy Storage: Power Sector: Nearly 160 GW(1) opportuni
Slide 14: NextEra Energy Partners
NexTera energy’ PARTNERS ay
Slide 15: NextEra Energy Partners' Portfolio
NextEra Energy Partners is a best-in-class clean energy company with a market capitalization of over $14 B(1) NextEra Energy Partners’ Portfolio(2) ~6,640 MW of wind ~1,530 MW of solar ~90 MW paired storage ~4.3 Bcf total natural gas Wind pipeline capacity(3) Solar Storage Pipeline Stable cash flows
Slide 16: IRA expected to positively impact drivers of NEP's long-term growth
The IRA is expected to have a positive transformational impact on several drivers of NEP’s long-term growth prospects NextEra Energy Partners Growth Opportunities NEP CAFD(1) Growth Avenues Enhanced Opportunities with the IRA Acquisitions Unparalleled from Energy Third-party wind and solar Repowers
Slide 17: Q&A Session
17 Q&A Session NeExTera’ ENERGY @
Slide 18: Appendix
18 Appendix NeExTera’ ENERGY @
Slide 19: aon ae
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Slide 20: 2022 Inflation Reduction Act ("IRA") – Key Provisions
The recently passed Inflation Reduction Act significantly expanded tax incentives for clean energy, which we believe will further stimulate renewables development in the U.S. 2022 Inflation Reduction Act (“IRA”) – Key Provisions(1) • Extends 100% PTC through at minimum, the later of: Wind and Solar
Slide 21: 2022 Inflation Reduction Act ("IRA") – Key Provisions
Along with expanded and new tax incentives, the IRA introduced new tax provisions, specifically the ability to transfer tax credits to third parties 2022 Inflation Reduction Act (“IRA”) – Key Provisions(1) • 10-year $3/kg PTC, indexed for inflation(2) Clean Hydrogen • Preserves wind and solar PTC on
Slide 22: IRA introduces a corporate minimum tax of 15% on pre-tax book income
The IRA also introduces a corporate minimum tax(1) of 15% on pre-tax book income Corporate Minimum Tax (“CMT”) Summary • Introduces a CMT for tax years Considerations after 2022 equal to 15% of pre-tax book income (PTBI) ✓ Can deduct accelerated depreciation • PTBI gets adjusted to reflect tax (MACR
Slide 23: Corporate Minimum Tax ("CMT") Summary (Continued)
Under the IRA, companies will need to pay taxes at the greater of regular tax and the corporate minimum tax Corporate Minimum Tax (“CMT”) Summary (Continued) Regular Tax CMT Starting Point? Taxable income Pre-tax book income Yes, can use MACRS Yes, can use MACRS Deduct Tax Depreciation? (or Bonus if
Slide 24: NextEra Energy's Financial Expectations
We remain well-positioned to continue our strong adjusted EPS and dividends per share growth NextEra Energy’s Financial Expectations(1) • After two previously announced increases, reflects ~10% $3.45 - compound annual growth from $3.23 - $3.70 2021 to the high-end of the 2025 $2.98 - $3.43 adjusted
Slide 25: Reconciliation of Earnings Per Share to Adjusted Earnings Per Share
Reconciliation of Earnings Per Share Attributable to NextEra Energy, Inc. to Adjusted Earnings Per Share(1) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(2) 2017(2) 2018 2019 2020 2021 Earnings Per Share Attributable to NextEra Energy, Inc. (assuming dilution) $ 0.58 $ 0.81 $ 0.82 $ 1.
Slide 26: Definitional information
Definitional information NextEra Energy, Inc. Adjusted Earnings Expectations This presentation refers to adjusted earnings per share expectations. Adjusted earnings expectations exclude the cumulative effect of adopting new accounting standards, the effects of non-qualifying hedges and unrealized ga
Slide 27: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward- looking statements are not statements of historical facts, b
Slide 28: Cautionary Statement And Risk Factors That May Affect Future Results (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) effect of reductions in the liquidity of energy markets on NextEra Energy's ability to manage operational risks; effectiveness of NextEra Energy's risk management tools associated with its hedging and trading procedures to
Slide 29: NextEra Energy Partners
NexTera energy’ PARTNERS ay
Slide 30: NextEra Energy Partners' Financial Expectations
NextEra Energy Partners remains well-positioned to deliver on its long-term growth objectives NextEra Energy Partners’ Financial Expectations Annualized LP DPU(1) YE 2022 Portfolio Run-Rate(3) ($ MM) $4.45 - $4.95 $3.98 - $1,785 - $1,985 $4.30 $3.55 - $3.17 - $3.74 $3.25 $2.83 $685 - $775 2021 2022E
Slide 31: Definitional information
Definitional information NextEra Energy Partners, LP. Adjusted EBITDA and CAFD Expectations This presentation refers to adjusted EBITDA and CAFD expectations. Adjusted EBITDA, CAFD, limited partner distributions and other expectations assume, among other things, normal weather and operating conditio
Slide 32: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This presentation contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are not statements of historical facts, but instead represent the current expectations of NextEra
Slide 33: Cautionary Statement And Risk Factors That May Affect Future Results (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NEP may not be able to extend, renew or replace expiring or terminated power purchase agreements (PPA), natural gas transportation agreements or other customer contracts at favorable rates or on a long-term basis; If the en
Slide 34: Cautionary Statement And Risk Factors That May Affect Future Results (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NEP's ability to make distributions to its unitholders depends on the ability of NEP OpCo to make cash distributions to its limited partners; If NEP incurs material tax liabilities, NEP's distributions to its unitholders ma
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