Cms Energy Corporation · NYSE:CMS
Cms Energy — Investor Presentation (June 2021)
18 slides from Cms Energy's investor presentation, Jun 23, 2021
Slide 1: Integrated Resource Plan
Integrated Resource Plan Leading the Clean Energy Transformation June 2021
Slide 2: Forward-Looking Statements
This presentation is made as of the date hereof and contains “forward-looking statements” as defined in Rule 3b-6 of the Securities Exchange Act of 1934, Rule 175 of the Securities Act of 1933, and relevant legal decisions. The forward-looking statements are subject to risks and uncertainties. All f
Slide 3: 2021 Integrated Resource Plan Key Outcomes
2021 Integrated Resource Plan . . . Key Outcomes Retires ALL coal by 2025 (depreciated over design life) Adds >$1 Bn of rate base over next 5 years (>95% utility by 2025) Accelerates decarbonization a (~60% carbon emissions reduction by 2025) Increases renewable resource deployment (~8 GW of solar b
Slide 4: Proposed IRP Actions
Proposed IRP Actions . . . Key Objectives Current Plan 2021 IRP ~(60)% carbon • Accelerates Decarbonization Exit coal Exit coal emissions by 2040 by 2025 reduction Retire by 2025a Karn 3&4 (oil) 2031 2023 Campbell 1&2 / Campbell 3 2031/2039 2025 No new Purchase >2 GW • Ensures Reliability, Resilienc
Slide 5: Accelerates Decarbonization
Accelerates Decarbonization . . . Coal Retirements Key Benefits Carbon • Reduces carbon emissions ~60%a by 2025 Emission ~(33)% ~(40)% ~(60)% (100)% Reductiona 2.7 0.9 • Exceeds scientific targets / policy goals Additional decarb efforts: 10% • CCS • Enhances commitment to net zero by 2040 Capacity
Slide 6: Ensures Reliability and Resilience
Ensures Reliability and Resilience . . . Generates ~$650 MM in customer savingsa Acquiring Existing Gas Plants… Key Benefits • Adds >$1 Bn of rate base • Backfills capacity with existing gas plants Signed agreements • Local, controllable generation in MISO Zone 7 Covert DIG & Peakers • Competitively
Slide 7: Increases Renewables & Customer Programs
Increases Renewables & Customer Programs . . . 2018 IRP 2021 IRP Future IRP Key Benefits ✓Capex approved 50% PPA / 50% Filed for approval of first 3 years Long-term alignment, approval in future IRP • Modular build-out; riding the cost- owned >50% owned curve down Opportunity +1,500 MW • Total of ~8
Slide 8: Clean Energy Transformation
Clean Energy Transformation . . . Capacity Mixa 12% 15% 15% 15% 8% 10% 10% 12% 8% 11% 10% • Exits coal by 2025 28% 40% • Ensures reliability, 31% resilience and affordability • >3x renewable 63% 63% 11% energy capacity 47% 35% 19% Today 2025 2030 2040 Coal Renewables Natural Gas Storage Peaking Plan
Slide 9: Maintains Strong Balance Sheet
Maintains Strong Balance Sheet . . . Key Benefits • Maintains solid investment grade Depreciates assets over design life while credit ratings a reducing costs for customers • Mitigates levering effect of securitizations on balance sheet • Accelerates rate base growth Avoids credit dilutive effects o
Slide 10: A Simple Investment Thesis
A Simple Investment Thesis . . . Industry-leading clean energy commitment a Net Zero Carbon (2040) & Net Zero Methane (2030) Clean Energy Leader Diversified Service Infrastructure Excellence through the Territory Renewal Top-tier regulatory jurisdictionb Strong Cash Flow Constructive & Balance Sheet
Slide 11: Appendix
Appendix 11 11
Slide 12: Caring for Our Co-Workers and Communities
Caring for Our Co-Workers and Communities . . . We Have Done This Before • Retired seven coal units in 2016 with Karn 1&2 scheduled to retire in 2023 • Caring for our co-workers and working to redevelop our communities • Retention incentive and placement plans for employees • Work with communities t
Slide 13: Maintains Strong Balance Sheet
Maintains Strong Balance Sheet . . . Karn 3 & 4 Campbell 1 & 2 Campbell 3 Size (MW)a 1,119 608 840 Rate Base at ~$110 ~$375 ~$810 Retirement (MM)b Fuel Oil Coal Coal Retirement Date 2023 2025 2025 Design Life 2031 2031 2039 Recovery Assets in rate base – depreciated over design life Presentation end
Slide 14: Key Components
Key Components . . . Renewables & Storage Delivering Across the Solar 4.5 GW by 2030, 7.8 GW by 2040 Triple Bottom Line Battery ~0.5 GW by 2040 (beginning in 2030) Wind ~0.8 GW by 2023 (approved via RPS) ✓ Exits coal by 2025 Customer Programs By 2030 ✓ Accelerates Energy Efficiency ~1,100 MW decarbo
Slide 15: Our Energy Supply Will Be Cleaner
a Our Energy Supply Will Be Cleaner . . . Current Mix Future Mix (2031) Customer >50% (Post-MCV PPA Expiration) Programs Carbon free Future 2% opportunity Wind, Storage Hydro & 3% Customer other Wind, Programs 10% Hydro & 17% other 10% Natural Natural Gas Gas 46% Nuclear 39% 42% 19% Storage 2% Net S
Slide 16: Deploying Renewables
Deploying Renewables . . . Frequency of Insufficient Capacity Key Considerations Predominantly Renewables . . . With Gas Plants J F M A M J J A S O N D J F M A M J J A S O N D Hour 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 • A predominantly renewables scenario Does not meet Meets 1 2 rel
Slide 17: Endnotes
Endnotes “us evens
Slide 18: Presentation Endnotes (pg 1)
Presentation Endnotes (pg 1) Slide 3: aFrom 2005 baseline including utility-owned generation, PPAs and MISO purchases, post coal retire b2021 IRP vs. current plan savings Slide 4: aFrom 2005 baseline including utility-owned generation, PPAs and MISO purchases, post coal retirements b2021 IRP vs. cur