Nextera Energy, Inc. · NYSE:NEE
Nextera Energy — Barclays CEO Energy-Power Conference 2018
39 slides from Nextera Energy's conference presentation, Sep 5, 2018
Slide 1: Barclays CEO Energy-Power Conference
Barclays CEO Energy-Power Conference John Ketchum Executive VP and CFO, NextEra Energy September 5, 2018
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results This presentation includes forward-looking statements within the meaning of the federal securities laws. Actual results could differ materially from such forward-looking statements. The factors that could cause actual results to d
Slide 3: NextEra Energy is comprised of two strong businesses supported by a common platform
NextEra Energy is comprised of two strong businesses supported by a common platform • ~$81 B market capitalization(1) • ~47 GW in operation(2) • ~$95 B in total assets(3) • The largest electric utility • The world leader in in the United States by electricity generated retail MWh sales from the wind
Slide 4: We have a long-term track record of delivering value to shareholders
We have a long-term track record of delivering value to shareholders Adjusted Earnings Per Share(1) Total Shareholder Return(3) $6.70 $6.19 40% 70% $5.71 34% 60% $5.30 60% $4.97 $4.39 $4.57 30% 50% $3.84 $4.05 $4.30 $3.49 22% 38% 40% $3.04 20% $2.63 30% 24% 12% 10% 20% 10% 0% 0% '05 '06 '07 '08 '09
Slide 5: We are well positioned to continue this track record
We are well positioned to continue this track record Wholesale & Service FPL Coal FPL Territory Retirements Energy Expansion Services FPL FPL Battery FPL T&D FPL New Solar Infrastructure Generation Storage Expect $40 B - $44 B(1) FPL Capital New Wind Generation Asset of capital Recycling Growth Mode
Slide 6: FPL's focus is on providing customers low bills, high reliability and outstanding customer service
Florida Power & Light’s focus is on providing customers low bills, high reliability and outstanding customer service FPL – Areas of Focus FPL 1,000-kWh Residential Bill FPL Service Reliability (“SAIDI”)(4) $140 ~$138 ~101 minutes $120 ~$119 ~$109 $100 ~$99 $80 ~56 minutes $60 Good $40 $20 $- FPL FPL
Slide 7: NextEra Energy announced agreement to acquire Gulf Power, Florida City Gas, and Stanton and Oleander plants
NextEra Energy announced agreement to acquire Gulf Power, Florida City Gas, and the Stanton and Oleander natural gas power plants Transaction Overview • Addition of attractive regulated electric and natural gas franchises are an Tallahassee Tallahassee Tallahassee Tallahassee excellent geographic an
Slide 8: Energy Resources' growth is driven by its best-in-class development skills and competitive advantages
Energy Resources’ growth is driven by its best-in-class development skills and competitive advantages Energy Resources Development Skills 20,000 Wind and Solar Portfolio(1) 15,000 Customer Relationships MW Engineering/ 10,000 Regulatory Construction Management 5,000 0 Wind Solar Best-In-Class Integr
Slide 9: Energy Resources' competitive advantages position us well for continued renewables development success
Energy Resources’ competitive advantages position us well for continued renewables development success Energy Resources – Key Competitive Advantages 2017 Top 10 U.S. Capital Investors(1) Wind O&M(2) $/MWh $20 ~$19 ~$17 ~25% Reduction $15 $B ~$12 ~$11 ~$10 $10 ~$10 ~$9 ~$8 ~$8 ~$8 $5 $0 A B C NEE D E
Slide 10: Wind and solar expected to be competitive into the next decade
With continued technology improvements and cost declines, wind and solar are expected to be competitive into the next decade Wind and Solar Technology Levelized Cost of Levelized Cost of Electricity from Wind Electricity from Solar (Including Production Tax Credits) (Including Investment Tax Credits
Slide 11: Battery efficiency improvements and cost declines expected to expand the storage market
Battery efficiency improvements and cost declines are expected to expand the storage market and enable even greater renewables expansion Storage Technology Lithium-ion 4-Hour Battery Pack Cost(1) Battery Storage Adder(2) $/kWh $/MWh $1,200 $80 $71-$81 $1,000 $70 $1,000 $60 $800 $45-$55 $50 $642 $38-
Slide 12: Energy Resources backlog of future renewables projects has never been stronger
Energy Resources backlog of future renewables projects has never been stronger Energy Resources Renewables Backlog(1) (MW) ~7,400 ~5,000 ~3,700 ~2,900 ~2,400 ~2,100 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017 Q2 2018 Wind Solar Repowering Energy Storage Year to date 2018, Energy Resources announced ~2,6
Slide 13: Well positioned to capitalize on potentially disruptive changes to our industry
We are well positioned to capitalize on and respond to potentially disruptive changes to our industry in the next decade Disruptive Industry Changes Potential Cost per kWh Post-2020(1) Shale (¢/kWh) Gas 3.5 - 5¢ 4 - 5¢ 3 - 4¢ 3 - 4¢ Big Data Renewables /Storage 2 - 2.5¢ Generation Wind Solar Gas Coa
Slide 14: We remain well positioned to achieve the $7.70 target adjusted EPS for 2018
We remain well positioned to achieve the $7.70 target adjusted EPS for 2018 as well as our long-term financial expectations NextEra Energy’s Adjusted Earnings Per Share Expectations(1) • The Gulf Power, Florida City $9.40 - Gas, and two natural gas $9.95 $8.70 - power plant acquisitions are $9.20 $8
Slide 15: NextEra Energy Partners
NExTera energy” PARTNERS Z
Slide 16: Since the IPO, NEP has grown distributions by ~133%
Since the IPO, NEP has grown distributions by ~133% and delivered total unitholder return of 126% Annualized Total Unitholder Return LP Distributions(1) NEP vs. Indices $1.75 140% 126% 120% 100% 80% 60% 60% 42% 40% $0.75 20% 6% 0% Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 20
Slide 17: NEP's value proposition is built upon four core strengths
NEP’s value proposition is built upon four core strengths NextEra Energy Partners’ Core Strengths High-Quality Portfolio(1) Financial Strength and Flexibility Issuer Credit ~4.7 GW Rating(4) Year-end 2017 17-Yr Baa1 Renewables >90% Ba1/BB/BB+ Remaining Counterparty Capacity of Project Debt ~1.2x & T
Slide 18: Agreement to acquire ~1.4 GW of renewable projects from Energy Resources
We continue to execute on our plan to expand NextEra Energy Partners’ portfolio by announcing agreement to acquire ~1.4 GW of renewable projects from Energy Resources NextEra Energy Partners – Portfolio Additions • Purchase price of $1.275 B(1), Portfolio Overview plus assumption of: Remaining Proje
Slide 19: NextEra Energy Partners – Portfolio Financing
The acquisition will be funded with the Canadian asset sale proceeds and a $750 MM convertible equity portfolio financing with BlackRock NextEra Energy Partners – Portfolio Financing(1) • BlackRock pays $750 MM in Financing Comparison exchange for an equity interest in 2018 the acquisition portfolio
Slide 20: NEP's credit ratings increase financing flexibility and debt capacity
NEP’s credit ratings increase financing flexibility and debt capacity due to greater market access Corporate Credit Rating and Debt Capacity • NEP corporate credit ratings: Convertible Term Loan B High-Yield Equity Debt Portfolio Convertible Financing Revolving Moody’s S&P Fitch Preferred Credit Fac
Slide 21: NEP's long-term outlook for distribution growth through 2023 is best-in-class
NEP’s long-term outlook for distribution growth through 2023 is best-in-class NextEra Energy Partners Financial Expectations Annualized LP Distributions(1) Adjusted EBITDA and CAFD(3) Annual 12% - 15% $1,000–$1,150 MM Growth(2) $1.81-$1.86 $1.62 $360–$400 MM Q4 2017 Q4 2018E Q4 2023E 12/31/2018 12/3
Slide 22: NEP offers a superior value proposition
We believe NEP offers a superior value proposition and is better positioned than ever to deliver upon its long-term expectations Investor Total Return Potential • Opportunity to earn a total return of ~4% 16% - 19% roughly 16% - 19% per year through at least 2023 12% - 15% • Diversified portfolio wi
Slide 23: NextEra Energy & NextEra Energy Partners
Seca ENERGY & a | NeExTera energy” PARTNERS Z
Slide 24: Appendix
Appendix NExTera’ NexTera energy” ENERGY & PARTNERS 2 24
Slide 25: NextEra Energy
NExTera’ ENERGY @
Slide 26: 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) Net of approximately $0.08 of income tax benefit at FPL 26
Slide 27: 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, effect of non-qualifying hedges, the transitional impa
Slide 28: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words or phrases such as “may,” “will,” “anticipat
Slide 29: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) 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 f
Slide 30: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) risk to NextEra Energy Resources of increased operating costs resulting from unfavorable supply costs necessary to provide NextEra Energy Resources' full energy and capacity requirement services; inability or failure by Nex
Slide 31: NextEra Energy Partners
NExTera energy” PARTNERS Z
Slide 32: NEP's portfolio is comprised of ~4.7 GW of renewable assets plus natural gas pipelines
NEP’s portfolio is comprised of ~4.7 GW of renewable assets plus seven natural gas pipelines with an ~17 year weighted average remaining contract life Portfolio Overview(1) Project COD Location Net MW Technology Counterparty Credit PPA Life Ashtabula III Dec-10 ND 62 Wind A3 20 Baldwin Dec-10 ND 102
Slide 33: Portfolio Financing Summary Terms
Portfolio Financing Summary Terms(1) Key Terms Summary Funding Amount: BlackRock to fund $750 MM; NEP to fund the balance of the $1,275 MM Energy Resources portfolio purchase price Issuer: Newly-formed private HoldCo managed and operated by affiliates of NEP BlackRock to purchase Class B Common Equi
Slide 34: Expected Cash Available for Distribution
Expected Cash Available for Distribution(1) (December 31, 2018 Run Rate CAFD) $1,100-$1,250 ($15-$25) ($75-$85) $1,000-$1,150 ($170-$250) ($400-$480) ($30-$35) ($5-$15) $360-$400 Project-Level Corporate IDR Fees Adjusted Debt Pre-Tax Non-Cash Maintenance Estimated Adjusted Expenses EBITDA Service (2
Slide 35: Definitional information
Definitional information NextEra Energy Partners, LP. Adjusted EBITDA and CAFD Expectations This presentation refers to adjusted EBITDA and CAFD expectations. NEP’s adjusted EBITDA expectations represent projected (a) revenue less (b) fuel expense, less (c) project operating expenses, less (d) corpo
Slide 36: 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 37: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) A change in the jurisdictional characterization of some of the Texas pipeline entities' assets, or a change in law or regulatory policy, could result in increased regulation of these assets, which could have a material adve
Slide 38: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) The natural gas pipeline industry is highly competitive, and increased competitive pressure could adversely affect NEP's business; NEP may not be able to access sources of capital on commercially reasonable terms, which wou
Slide 39: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Holders of NEP's common units and preferred units currently cannot remove NEP GP without NEE’s consent; NEE’s interest in NEP GP and the control of NEP GP may be transferred to a third party without unitholder consent; The
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