Wec Energy Group, Inc. · NYSE:WEC

Wec Energy — Investor Presentation (January 2024)

52 slides from Wec Energy's investor presentation, Jan 9, 2024

1. Slide 1: Investing in Efficiency, Sustainability and Growth

   1 Investing in Efficiency, Sustainability and Growth Investor Update: January 2024

2. Slide 2: Cautionary Statement Regarding Forward-Looking Information

   2 Cautionary Statement Regarding Forward-Looking Information Much of the information contained in this presentation is forward-looking information based upon management’s current expectations and projections that involve risks and uncertainties. Forward-looking information includes, among other thin

3. Slide 3: The Premier Energy Company in America's Heartland

   3 The Premier Energy Company in America’s Heartland * As of December 31, 2023 $26.6 billion market cap* 4.6 million retail customers 60% ownership of American Transmission Company $43.4 billion of assets

4. Slide 4: A History of Quality Earnings Growth

   4 A History of Quality Earnings Growth $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 $4.50 $5.00 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 GAAP Adjusted** 2023 Guidance 2023 Adjusted Guidance** * Estimated based on 2023 adjusted guidance midpoint of $4.6

5. Slide 5: Consistent Performance Over Time: EPS Guidance Exceeded

   5 EPS Guidance 2022 Exceeded  2021 Exceeded  2020 Exceeded  2019 Exceeded  2018 Exceeded  2017 Exceeded  2016 Exceeded  2015 Exceeded  2014 Exceeded  2013 Exceeded  2012 Exceeded  2011 Exceeded  2010 Exceeded  2009 Exceeded  2008 Exceeded  2007 Exceeded  2006 Exceeded  2005 Exceeded

6. Slide 6: Strong Dividend Growth Continues

   6  The board of directors announced its plan to raise the dividend by 7.0% to a new annual rate of $3.34 per share*  Marks the 21st consecutive year of rewarding shareholders with higher dividends  Top decile dividend growth in industry** Strong Dividend Growth Continues * The board of directors

7. Slide 7: What's New?

   7 What’s New?

8. Slide 8: Illinois Rate Review

   8  The company will book a non-cash charge of 41 cents per share related to the disallowance of construction costs for modern service centers and facilities.  ICC ordered Peoples Gas (PGL) to pause all spending on the Safety Modernization Program until it determines ‘the optimal method’ of pipe re

9. Slide 9: Progress on Efficiency, Sustainability and Growth: Natural Gas Safety Modernization

   9 Progress on Efficiency, Sustainability and Growth Natural Gas Safety Modernization  Increasing capacity and reliability of natural gas service in our territories Illinois  37% complete*  Program under ICC review Taking Steps to Maintain Reliable and Affordable Service for Our Customers Systemat

10. Slide 10: Capital Plan Flexibility

    10 Capital Plan Flexibility Options and Opportunities:  Illinois gas delivery: - $700 to $900 million Energy infrastructure: + $700 to $900 million Wisconsin operations: + $200 to $400 million

11. Slide 11: Current 2024-2028 Capital Plan

    11 $9.3 $1.0 $3.7 $6.0 $3.0 $0.4 $23.4 2024-2028 Energy Infrastructure ATC* Gas Delivery** WI/MI Electric Delivery WI LNG Capacity WI/MI Generation $ In billions *ATC is accounted for using the equity method; this represents WEC Energy Group’s portion of the investment. ** Includes all gas utilities

12. Slide 12: Robust Growth in Asset Base

    12 $29.4 billion $43.3 billion 2023E* 2028E* Robust Growth in Asset Base *Estimated year-end average asset base. Expect compound annual EPS growth of 6.5% to 7.0% 8.1% Growth

13. Slide 13: Business Portfolio Growing in Electric Transmission and Generation

    13 Business Portfolio Growing in Electric Transmission and Generation 2028E*2023E* Electric generation and distribution 48% Natural gas distribution 35% WECI 7% Electric transmission** 10% ** ATC is accounted for using the equity method; this represents WEC Energy Group’s portion of the asset base.

14. Slide 14: Exiting Coal

    14 We now plan to eliminate coal as an energy source three years earlier - by end of 2032.  Retirements planned:  Oak Creek Units 5-6: 528 MW (May 2024)  Oak Creek Units 7-8: 611 MW (late in 2025)  Columbia Units 1-2: 300 MW (by June 1, 2026)  Weston Unit 3: 328 MW (end of 2031)  Enhancing fue

15. Slide 15: Investing $6.8 Billion in Regulated Renewables

    15 Target Project Utility WEC Ownership1 WEC Investment ($M) WEC Capacity (MW) In-Service Badger Hollow II Solar Park WEPCO 66.7% 172E 100 S: 2024/B: 2025 Paris Solar-Battery Park WEPCO and WPS 90% 542E 279 2024 Darien Solar Park2 405E 225 2026 Koshkonong Solar Park2 486E 270 1. Madison Gas & Electr

16. Slide 16: Modernizing Our Gas-Fueled Generation Fleet

    16 Modern, efficient natural gas generation will serve as a critical resource in our energy transformation. Modernizing Our Gas-Fueled Generation Fleet West Riverside Energy Center Combined-Cycle  Additional 100 MW option*  Expected investment: $100 million  Target: 2024 Combustion Turbines  1,1

17. Slide 17: Investing in Reliability for Our Natural Gas Network

    17 Investing in Reliability for Our Natural Gas Network  New proposed LNG storage facilities are needed to ensure gas supply for winter reliability.  Expected investment: $860 million  4 Bcf planned  LNG storage facilities under construction address the need to support our natural gas distributi

18. Slide 18: Future Transmission Investment

    18 $547 $636 $867 $1,148 $1,187 $1,152 $328 $382 $520 $689 $712 $691 2023 2024 2025 2026 2027 2028 ATC WEC portion 60%  Includes $330 million for MISO Tranche 1 Plan (in 2022 dollars)  MISO Tranche 2 planning underway WEC portion of ATC investment expected from 2024-2028: $3.0 billion Future Trans

19. Slide 19: Projected Cash Flows and Financing Plan

    19 Projected Cash Flows and Financing Plan ($ in billions) Cash from Operations $16.5 - $17.5 Incremental Debt $7.0 - $8.0 Dividends $6.0 - $6.2 Capital Plan* $20.4 Cash Uses Cash Sources Common Equity $1.8 - $2.2 * Excludes ATC’s capital. ATC is accounted for using the equity method. 2024 - 2028

20. Slide 20: Credit Quality – Maintaining a Healthy Balance Sheet

    20 Credit Quality – Maintaining a Healthy Balance Sheet Current Issuer Credit Ratings Entity S&P Rating Moody’s Rating WEC Energy Group A- Baa1 Wisconsin Electric A- A2 Wisconsin Gas A A3 Wisconsin Public Service A- A2 Peoples Gas A- A2 FFO/Debt Metrics 2024-2028 WEC Energy Group Target GAAP FFO to

21. Slide 21: Carbon Reduction Goals – Electric Generation

    21 *Includes projection of potential carbon offsets by 2050. Carbon Reduction Goals – Electric Generation We have established aggressive carbon reduction goals for our electric generating fleet, aligned with or surpassing global emissions pathways aimed at limiting warming to 1.5°C. Reduction goals:

22. Slide 22: Methane Reduction

    22 Goal: Net zero by end of 2030** * Represents a decrease in the rate of methane emissions across our system from a 2011 baseline. ** This goal applies to emissions from WEC Energy Group natural gas distribution companies calculated in accordance with EPA’s 40 Code of Federal Regulations Part 98, S

23. Slide 23: Organic Flow Battery Storage Pilot Project

    23  Leading a pilot project to test a new form of long-duration energy storage.  Partnering with EPRI and CMBlu Energy  This system uses a proprietary technology that incorporates environmentally friendly materials - ‘a green battery.’  The project will test battery system performance, including

24. Slide 24: Regional Economy

    e Regional Economy _— oe

25. Slide 25: Powering Industry Leaders in Our Region

    25 Powering Industry Leaders in Our Region

26. Slide 26: Longer-Term Sales Forecast

    26 Longer-Term Sales Forecast Wisconsin Segment Year-Over-Year 2026-2028 Electric 4.5%-5.0% Gas 0.7%-1.0% Sales Growth Forecast (weather-normalized)

27. Slide 27: Key Takeaways for WEC Energy Group

    27  Track record of top decile performance among regulated utilities.  Industry leading earnings quality.  Capital plan drives premium EPS growth of 6.5% to 7.0%.  98%+ of capital allocated to regulated businesses.  Dividend growth projected to be in line with earnings growth.  Aggressive envi

28. Slide 28: Appendix

    Appendix Wa wec VA Energy Group

29. Slide 29: Business Overview

    29 Electric Distribution Electric Transmission 60% ownership Electric Generation Energy Infrastructure Natural Gas Distribution

30. Slide 30: Inflation Reduction Act

    30  Extension of production tax credits (PTC) and investment tax credits (ITC).  PTC option for solar projects.  ITC for stand-alone electric storage projects.  Tax credit “transferability” to provide additional options for monetization.  Credit positive.  At WEC, no material impact expected f

31. Slide 31: Commitment to ESG

    31 Reduce carbon dioxide emissions from electric generation 60% by end of 2025 and 80% by end of 2030 – both from a 2005 baseline. Long- term goal of net-zero carbon emissions from our generating fleet by 2050 Planned exit from coal by end of 2032 Targeting net-zero methane emissions from distributi

32. Slide 32: Electricity Supply by Fuel Type

    32 Electricity Supply by Fuel Type (megawatt-hours delivered to regulated utility customers) 73% 32% 7% 38% 43% 17% 22% 21% 3% 8% 34% 2005 2022 2030E 2032 2050 Coal Natural Gas Nuclear Renewables Exiting Coal <2% Net carbon neutral goal Planned exit from coal

33. Slide 33: Reducing Greenhouse Gas Emissions

    33 Reducing Greenhouse Gas Emissions 0.78 0.43 0.33 0.16 0** 2005 2022 2025E 2030E 2050E Greenhouse gas intensity* (metric tons CO2/MWh) *Includes owned electric generation, purchased power and WEC Infrastructure (WECI). The environmental attributes of the WECI renewable facilities are or may be the

34. Slide 34: WEC Infrastructure Portfolio

    34 SD IL NE WEC Infrastructure Portfolio In service Under development Total Project Capacity (MW) Investment (in millions) Wind ● Upstream 200 $307 ● Bishop Hill III 132 166 ● Coyote Ridge 97 145 ● Blooming Grove 250 389 ● Tatanka Ridge 155 240 ● Jayhawk 190 282 ● Thunderhead 300 381 ● Sapphire Sky

35. Slide 35: WEC Infrastructure Projects and Offtake Agreements

    35 Project Developer Investment Offtake Agreement WEC Commercial Operations Total Project Capacity Bishop Hill III Wind Energy Center Invenergy $166M for 90% ownership WPPI Energy 22 years 8/31/18 132 MW Upstream Wind Energy Center Invenergy $307M for 90% ownership Affiliate of Allianz 10 years 1/10

36. Slide 36: Why Our Natural Gas Distribution Networks Matter

    36 Today and Tomorrow Why Our Natural Gas Distribution Networks Matter Our Service Area  65%-78% of homes use natural gas for heating  Growth continues as customers convert to natural gas Hydrogen and RNG Opportunities  Potential to blend  Investment potential to convert existing distribution ne

37. Slide 37: Progress on Efficiency, Sustainability and Growth: Electric Delivery

    37 Progress on Efficiency, Sustainability and Growth Electric delivery redesign/resilience  Addressing aging infrastructure and system hardening  Enhancing efficiencies and reducing operating costs  Expect to spend $3.7 billion (2024- 2028) with continued investment over next decade Taking Steps

38. Slide 38: Utility Capital Plan Drives EPS Growth

    38 Utility Capital Plan Drives EPS Growth $23.0 Billion Projected Capital Spend From 2024-2028 1,026 1,288 1,616 1,918 2,229 2,277 140 26 110 384 344 100 630 775 790 729 737 730 1,027 1,220 1,214 1,176 1,265 1,113 311 382 520 689 712 691 $3,134 $3,691 $4,250 $4,896 $5,287 $4,911 - 1,000 2,000 3,000

39. Slide 39: Capital Plan Projections

    39 Company 2023 2024 2025 Wisconsin Electric $1,240.3 $1,661.6 $1,877.4 Wisconsin Gas 232.5 228.1 227.7 Wisconsin Public Service 652.7 620.7 783.8 Upper Michigan Energy 16.5 32.1 90.6 Wisconsin Segment $2,142.0 $2,542.5 $2,979.5 Peoples Gas 468.0 541.7 539.2 North Shore Gas 40.9 49.2 61.7 Illinois S

40. Slide 40: Composition of Asset Base

    40 Composition of Asset Base Total 2022 Average Asset Base of $26.5 Billion Note: We Power value represents investment book value. Company Asset Base - $B % of Total Wisconsin Electric $7.3 27.5% Wisconsin Gas 1.9 7.2 Wisconsin Public Service 4.2 15.9 Upper Michigan Energy Resources 0.4 1.5 Peoples

41. Slide 41: Diverse Portfolio of Businesses

    41 Diverse Portfolio of Businesses Based on 2022 average asset base. WI 63% IL 17% MI/MN 5% WECI 5% ATC* 10% By Jurisdiction By Business Electric generation and distribution 49%Natural gas distribution 36% WECI 5% Electric transmission* 10% *ATC is accounted for using the equity method; this represe

42. Slide 42: Power the Future Investments

    42 Power the Future Investments 1 Port Washington (Natural Gas) Oak Creek Expansion (Coal/Co-Fire Gas3) Capacity 1,090 MW 1,030 MW 2 Investment $664 million $2 billion 2 ROE 12.7% 12.7% Equity 53% 55% In Service Dates Unit 1 – July 2005 Unit 2 – May 2008 Unit 1 – February 2010 Unit 2 – January 2011

43. Slide 43: National Leader in Operating Efficiency and Financial Discipline

    43 National Leader in Operating Efficiency and Financial Discipline $28.10 $12.30 $15.40 $17.90 $20.40 $22.20 $24.30 $24.90 $26.80 $39.20 $77.20 $0 $10 $20 $30 $40 $50 $60 $70 $80 2022 Non-Fuel O&M per MWh* Source: FERC Form 1 Reports *For all companies, excluded 1) pensions and other employee benef

44. Slide 44: Focused on Efficiency

    44 Focused on Efficiency $1,342 $1,281 $1,234 $1,143 $1,107 $1,088 $1,082 2016 2017 2018 2019 2020 2021 2022 2023E $ I n m ill io n s *Excludes costs that have a revenue offset such as operation and maintenance costs associated with the We Power generation units, transmission expenses that are colle

45. Slide 45: Projected Financing Plans for 2024

    45 Projected Financing Plans for 2024 1 $1,900- $2,300 $100-$200 $0 $500 $1,000 $1,500 $2,000 $2,500 Holding Company Utilities & Energy Infrastructure Equity Issuance (i n m ill io n s ) $700-$1,200 2 1. Amounts and timing are subject to material change based upon numerous factors, including market

46. Slide 46: Balanced Sales Mix

    46 34% Large C&I by Segment Paper/Packaging 26% Foundry (SIC 33) 11% Mining/Minerals 10% Metal (SIC 34,35,37) 8% Other Manufacturing 8% Food/Agriculture 7% Medical 6% Education 4% Printing 3% Chemical 2% Office 2% Other 13% Balanced Sales Mix Large C&I 34% Residential and Farm 31% Small C&I 35% 2022

47. Slide 47: Regulatory Matters

    47 Estimated Decision Date Wisconsin (apps.psc.wi.gov)  Commission decision on limited re-opener for new base rates effective 1/1/24 (Dockets: WE and WG: 5-UR-110 and WPS 6690-UR-127)  Illinois (icc.illinois.gov)  Decision on general rate review for new base rates effective 12/1/23 (Dockets: PGL:

48. Slide 48: Regulatory Environment

    48 Regulatory Environment Wisconsin  Governor Tony Evers (D)  Commission  Gubernatorial appointment, Senate confirmation  Chairman: Gubernatorial appointment  6-year staggered terms Illinois  Governor J.B. Pritzker (D)  Commission  Gubernatorial appointment, Senate confirmation  Chairman: G

49. Slide 49: Rate-Making Parameters by Company

    49 Rate-Making Parameters by Company Utility Equity Layer1 Authorized ROE Wisconsin Electric 50.50%-55.50% 9.80% Wisconsin Public Service 50.50%-55.50% 9.80% Wisconsin Gas 50.50%-55.50% 9.80% Peoples Gas 50.79% 9.38% North Shore Gas 52.58% 9.38% Minnesota Energy Resources 53.00% 9.65% Michigan Gas U

50. Slide 50: Key Rate-Making Components

    50 Key Rate-Making Components Area Illinois– Gas Minnesota– Gas Michigan– Electric and Gas Wisconsin– Gas Wisconsin– Electric Gas Pipeline Replacement Rider MGU Bad Debt Rider ✓ Bad Debt Escrow Accounting Residential Residential Decoupling ✓ ✓ Fuel Cost Recovery 1 for 1 recovery of prudent fuel cost

51. Slide 51: Reconciliation of EPS (GAAP) to Adjusted EPS (Non-GAAP)

    51 Reconciliation of EPS (GAAP) to Adjusted EPS (Non-GAAP) 2014 2015 2016 2017 2023 Guidance EPS – GAAP basis $2.59 $2.34 $ 2.96 $ 3.79 $4.17 - $4.21 Acquisition Costs 0.06 0.39 0.01 – Integrys Earnings (0.47) Impact of Additional Shares 0.47 Tax Benefit Related to Tax Cuts and Jobs Act of 2017 (0.6

52. Slide 52: Contact Information

    52 Contact Information M. Beth Straka Senior Vice President – Investor Relations and Corporate Communications Beth.Straka@wecenergygroup.com 414-221-4639 Amanda Brockman Investor Relations Analyst Amanda.brockman@wecenergygroup.com 920-433-2966

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