Eversource Energy (d/b/a) · NYSE:ES
Eversource Energy (d/b/a) — Eversource Energy — FY2022 Earnings Presentation
38 slides from Eversource Energy (d/b/a)'s earnings presentation, Feb 14, 2023
Slide 1: 2022 Year-End Investor Call
EVERSOURCE ENERGY YEAR END 2022 RESULTS 2022 Year-End Investor Call February 14, 2023
Slide 2: Safe Harbor Statement
EVERSOURCE ENERGY YEAR END 2022 RESULTS Safe Harbor Statement All per-share amounts in this presentation are reported on a diluted basis. The only common equity securities that are publicly traded are common shares of Eversource Energy. The earnings and EPS of each business do not represent a direct
Slide 3: Agenda
EVERSOURCE ENERGY YEAR END 2022 RESULTS Agenda Joe Nolan 2022 – Year in Review Chairman, President & CEO Offshore Wind Update Clean Energy Initiatives John Moreira 2022 Financial Results EVP, CFO & Treasurer 2023 Earnings Guidance 2023 – 2027 Outlook Regulatory and Equity Issuance Upda
Slide 4: Joe Nolan
EVERSOURCE ENERGY YEAR END 2022 RESULTS Joe Nolan Chairman, President & Chief Executive Officer 3
Slide 5: A Look Back at The Year
EVERSOURCE ENERGY YEAR END 2022 RESULTS A Look Back at The Year Operations Delivered exceptional service and reliability for our customers through an active storm year Completed a $3.8 billion core business construction program to enhance reliability, resiliency, and customer service Regulatory
Slide 6: Operating Performance Remains Strong
EVERSOURCE ENERGY YEAR END 2022 RESULTS Operating Performance Remains Strong 2022 Average months Top Decile Among between interruptions (MBI) 19.5 Our Peers ELECTRIC RELIABILITY System average Top Quartile interruption duration 65.2 Among Our Peers (SAIDI) Better Than Injury rate per Industry Averag
Slide 7: Dividend Growth Continues to Outperform Peers
EVERSOURCE ENERGY YEAR END 2022 RESULTS Dividend Growth Continues to Outperform Peers Annualized Dividend $3.00 $2.70 $2.55 $2.50 $2.41 $2.27 Dividend Growth $2.14 Consistent with EPS Growth $2.00 +$0.15 $1.50 +$0.14 +$0.14 $1.00 +$0.13 $0.50 +$0.12 $0.00 2019 2020 2021 2022 2023 Payout 62% 62%* 62%
Slide 8: Eversource Offshore Wind Update
EVERSOURCE ENERGY YEAR END 2022 RESULTS Eversource Offshore Wind Update South Fork Wind construction continues to progress o Installation of onshore conduit system complete and onshore transmission cable and substation on track to be completed by this summer o Horizontal directional drilling to in
Slide 9: Proposed Capital Investments Needed to Unlock Renewable Distributed Energy Resources in Massachusetts
EVERSOURCE ENERGY YEAR END 2022 RESULTS Proposed Capital Investments Needed to Unlock Renewable Distributed Energy Resources (DER) in Massachusetts Interconnection upgrades needed to deliver additional clean energy into our system o Current proposal would enable about 1 GW of solar if all six clus
Slide 10: DER – Area Map of Six Solar Cluster Proposals
EVERSOURCE ENERGY YEAR END 2022 RESULTS DER – Area Map of Six Solar Cluster Proposals Plainfield- Blandford I-90 I-91 MA CT Plymouth Freetown Marion/ Fairhaven Cape Approved Dartmouth/ Westport 9
Slide 11: Grid Mod and AMI Update
EVERSOURCE ENERGY YEAR END 2022 RESULTS Grid Mod and AMI Update Grid Modernization Advanced Metering Infrastructure Key Customer Benefits Under way in Four-Year Plan Rate options to lower energy costs (2022-2025) Outages detected without customer reporting Approximately $205 million Easy a
Slide 12: Electric Vehicle Charging Infrastructure - Phase II Program
EVERSOURCE ENERGY YEAR END 2022 RESULTS Electric Vehicle Charging Infrastructure - Phase II Program December 2022 MA DPU order authorized approximately $188 million investment over 4 years to build out EV make-ready infrastructure o Approximately $66 million is capital, remainder is O&M Support
Slide 13: Clean Energy Project Update
EVERSOURCE ENERGY YEAR END 2022 RESULTS Clean Energy Project Update Networked Geothermal Pilot o Currently at 90% design milestone o Installation work to begin Spring 2023 o Target on-line for Winter heating season Battery Energy Storage System (BESS) o Award-winning Cape Cod battery storage pro
Slide 14: John Moreira
EVERSOURCE ENERGY YEAR END 2022 RESULTS John Moreira Executive Vice President, Chief Financial Officer & Treasurer
Slide 15: 2022 vs. 2021 Financial Results
EVERSOURCE ENERGY YEAR END 2022 RESULTS 2022 vs. 2021 Financial Results Full-Year Full-Year 4Q 2022 4Q 2021 Change Change 2022 2021 Electric Transmission $0.40 $0.38 $0.02 $1.72 $1.58 $0.14 Electric Distribution (Non-GAAP) 0.28 0.30 (0.02) 1.71 1.61 0.10 Natural Gas Distribution 0.25 0.22 0.03 0.67
Slide 16: Key 2023 Earnings Drivers
EVERSOURCE ENERGY YEAR END 2022 RESULTS 2023 EPS Guidance: $4.25 - $4.43 Key 2023 Earnings Drivers Transmission capital investments Base rate changes at MA electric and gas companies Increased revenue to support Distribution safety and reliability investments Lower expected storm costs Exp
Slide 17: Projected Capital Expenditures For Core Businesses
EVERSOURCE ENERGY YEAR END 2022 RESULTS Projected Capital Expenditures For Core Businesses $21.5 Billion 2023-2027 $5,000 $4,463 $4,373 $4,434 $4,500 $4,304 $215 $219 $170 $213 $244 $3,945 $4,000 $3,786 $203 $218 $194 $3,541 $208 $266 $235 $3,500 $1,035 $239 $155 $1,038 $1,146 $1,115 $3,064 $144 $ I
Slide 18: $3.3 Billion Increase in 2023-2026 Core Business Capex
EVERSOURCE ENERGY YEAR END 2022 RESULTS $3.3 Billion Increase in 2023-2026 Core Business Capex Since February 2022 Plan Increased Investment Needs to Better Serve Our Customers Up $1,665 million $8,000 $7,235 $7,000 $6,000 Up $847 $5,570 Up $726 million million $5,000 $ in Millions $4,329 $4,334 $4,
Slide 19: Key Elements Inside and Outside Our New $21.5B Capital Investment Forecast
EVERSOURCE ENERGY YEAR END 2022 RESULTS Key Elements Inside and Outside Our New $21.5B Core Business Capital Investment Forecast Included in Forecast Not Included Execution of updated capital AMI in CT investment forecast Electric storage investments in CT Recently approved Distributed Energ
Slide 20: Rate Base by Core Line of Business – Current and Future
EVERSOURCE ENERGY YEAR END 2022 RESULTS Rate Base by Core Line of Business – Current and Future $37.7 billion* 5% 22% Note: Excludes $24.4 billion* offshore wind 4% investments 17% 42% 43% 31% 36% 2021 Year-End Rate Base Projected 2027 Year-End Rate Base Transmission Electric Distribution Natural Ga
Slide 21: Well Performing Core Businesses Drive EPS CAGR Solidly into Upper Half of 5–7% Through 2027
EVERSOURCE ENERGY YEAR END 2022 RESULTS Well Performing Core Businesses Drive EPS CAGR Solidly into Upper Half of 5 – 7% Through 2027 $4.25- $4.09 $4.43 $3.86 $3.64 $3.45 $3.11 $3.25 $2.81 $2.96 $2.53 $2.65 $2.28 2012A* 2013A* 2014A* 2015A* 2016A 2017A 2018A 2019A* 2020A* 2021A* 2022A* 2023E* 2024E
Slide 22: Principal Funding Sources
EVERSOURCE ENERGY YEAR END 2022 RESULTS Expected Sources of Cash to Fund Five-Year Capital Program Principal Funding Sources Cash Flows from Operations New Debt Issuances Remaining ATM (Approx. $1B) Treasury Shares to Fund DRP and Employee Plans Potential proceeds from OSW Strategic Review 21
Slide 23: Status of State and Federal Regulatory Reviews
EVERSOURCE ENERGY YEAR END 2022 RESULTS Status of State and Federal Regulatory Reviews Electric Transmission (Federal Energy Regulatory Commission) 41% of 2022 regulated earnings Pending FERC decision on New England transmission ROEs dating back to 2011 in 4 open cases o Earnings currently reflect
Slide 24: A Value Proposition That Delivers Results for Investors
EVERSOURCE ENERGY YEAR END 2022 RESULTS A Value Proposition That Delivers Results for Investors Keys to Our Success: Results Delivered: Long-term average recurring EPS and dividend growth of about 6%, through 2022. Growth driven by 1. Exceed industry EPS and dividend robust regulated Cap Ex program
Slide 25: Appendix
EVERSOURCE ENERGY YEAR END 2022 RESULTS APPENDIX 24
Slide 26: Projected Transmission Capital Expenditures
EVERSOURCE ENERGY YEAR END 2022 RESULTS Projected Transmission Capital Expenditures Other concepts under $1,400 development $1,207 $1,196 $1,200 $1,109 $1,012 $1,012 $1,000 $352 $329 $956 $270 $174 $72 $ in Millions $252 $800 $438 $461 $600 $527 $436 $575 $748 $400 $200 $417 $406 $312 $324 $263 $136
Slide 27: Transmission Rate Base Growth Projections
EVERSOURCE ENERGY YEAR END 2022 RESULTS Transmission Rate Base Growth Projections $14,000 $11,527 $11,809 $12,000 $11,031 $10,502 $2,239 $2,288 $10,000 $9,854 $2,095 $9,161 $1,918 $1,748 $1,529 $8,000 $ in Millions $4,852 $5,116 $4,322 $4,578 $6,000 $3,992 $3,679 $4,000 $2,000 $3,953 $4,114 $4,262 $
Slide 28: Aquarion Rate Base Forecast
EVERSOURCE ENERGY YEAR END 2022 RESULTS Aquarion Rate Base Forecast $1,689 $1,549 Year- End Rate Base $ in Millions $1,480 $1,324 $1,216 $1,165 $1,037 $942 2020A 2021A 2022A 2023E 2024E 2025E 2026E 2027E 27
Slide 29: Offshore Wind Updates
EVERSOURCE ENERGY YEAR END 2022 RESULTS Offshore Wind Updates Assumptions October 2022 February 2023 Costs Locked in for Three Projects ~82% ~90% Offshore Investment as of Prior $1.8B $1.95B Quarter End Expected Spending 2023 * $1.9B - $2.1B Expected Total Spending 2024 – 2026 * $1.6B - $1.9B Expect
Slide 30: Revolution Wind and Sunrise Wind Now Well Into Siting Process
EVERSOURCE ENERGY YEAR END 2022 RESULTS Revolution Wind and Sunrise Wind Now Well Into Siting Process South Fork Wind Revolution Wind Sunrise Wind Size 130 MW 704 MW 924 MW Draft Environmental Impact Draft Environmental Impact Construction Operation Plan Final approvals received Statement issued Sep
Slide 31: FERC Transmission New England ROE Update
EVERSOURCE ENERGY YEAR END 2022 RESULTS FERC Transmission New England ROE Update Current base: 10.57%; Cap: 11.74% (2014 Opinion 531A) October 2018 FERC Order in New England ROE cases proposed a new methodology to address issues raised by Court in vacating Opinion 531A (New England ROE Complaint
Slide 32: Aquarion Connecticut Rate Review Summary
EVERSOURCE ENERGY YEAR END 2022 RESULTS Aquarion Connecticut Rate Review Summary Rate review filed on August 29, 2022 First rate review in nearly a decade Hearings held through December 7, 2022 Expected decision date of March 15, 2023 Revenue deficiency requested: o $27.5M in Year 1, or 13
Slide 33: Aquarion Water's $206 Million Plan to Improve SW CT Reliability
EVERSOURCE ENERGY YEAR END 2022 RESULTS Aquarion Water’s $206 Million Plan to Improve SW CT Reliability Aquarion Water’s $206 Million Plan to Improve Southwest CT Reliability Transmission Main Improvements Monroe Redding $180 M Program Investment Ridgefield o Phase 1 Water mains complete $10 milli
Slide 34: Equity Issuance Update
EVERSOURCE ENERGY YEAR END 2022 RESULTS Equity Issuance Update New Shares Treasury Shares $1.2 billion At-The-Market Dividend reinvestment, Program has issued 2.17M employee equity programs shares at a weighted average continue with approximately price of $92.31 in 2022 with 950,000 shares issue
Slide 35: 2023 Debt Issuances to Fund Utility Capital Needs and Maturities
EVERSOURCE ENERGY YEAR END 2022 RESULTS 2023 Debt Issuances to Fund Utility Capital Needs and Maturities 2023 Issuances to Date Company Size/Coupon Maturity CL&P $500M @ 5.25% Jan 15, 2053 PSNH $300M @ 5.15% Jan 15, 2053 2023 Larger Maturities Company Size/Coupon Maturity CL&P $400M @ 2.50% Jan 15,
Slide 36: Eversource Is Building On Our Commitment to Lower Emissions
EVERSOURCE ENERGY YEAR END 2022 RESULTS Eversource Is Building On Our Commitment to Lower Emissions 2021 GHG Footprint In 2019, we announced an industry 4% leading goal to reduce emissions from 5 7% key operational areas: 8% o Line loss 9% o Leaks from natural gas distribution 72% o Facilities o V
Slide 37: Networked Geothermal Pilot
EVERSOURCE ENERGY YEAR END 2022 RESULTS Networked Geothermal Pilot Currently at 90% design milestone In process of reviewing construction proposals Permitting and land rights work is underway 149 customers and 39 buildings total Primary purpose is to gather sufficient data on the costs, op
Slide 38: Eversource Recognized as a Leading Energy Company
EVERSOURCE ENERGY YEAR END 2022 RESULTS Eversource Recognized as a Leading Energy Company Included in Newsweek’s list of Most Responsible Companies as the #1 Utility Included in the CNBC/Just Capital list of JUST 100 Companies, a ranking of most responsible publicly traded companies Recognized in Bl