Mge Energy Inc. · NASDAQ:MGEE
Mge Energy — AGA Financial Forum 2022
31 slides from Mge Energy's conference presentation, May 16, 2022
Slide 1: Technology in Action
Technology in Action Bringing the benefits of sustainability to all. AGA FINANCIAL FORUM MIAMI BEACH, FLORIDA MAY 2022
Slide 2: Disclaimer
Disclaimer This presentation contains summarized information concerning MGE Energy, Inc. (“MGE Energy”) and its subsidiaries (principally Madison Gas and Electric Company (“MGE”)) and MGE Energy’s consolidated business, operations, financial performance and trends. No representation is made that the
Slide 3: Cautionary Note Regarding Forward-looking Information
Cautionary Note Regarding Forward-looking Information All statements in this presentation, other than historical facts, are forward-looking statements (including but not limited to forecasted capital expenditures, expected in-service dates and carbon dioxide projections) that involve risks and uncer
Slide 4: Company Mission and Values
Company Mission and Values MGE Energy is the parent company of Madison Gas and Electric Company (MGE). MGE is your community energy company, committed to engaging with our customers in different ways to meet their needs and providing safe, reliable, affordable and sustainable energy to power our com
Slide 5: Company Highlights
Company Highlights Diversified Customer Base and Revenue Profile Regulated, Highly Visible Growth Resilient Revenue Stream and Customer Base Historical 5-Year Regulated PPE(1) CAGR of 8.0% • Electric service to ~159,000 customers located in the city of Madison and • Forecasted capital investment of
Slide 6: Corporate Structure
Corporate Structure Central Wisconsin Madison Gas and MGE Transco MGEE Transco, MGE State Energy MGE Services, MGE Power LLC MAGAEL, LLC Development Electric Company Investment LLC LLC Services, LLC (3) LLC (3) Corporation North Mendota MGE Power MGE Power Elm Energy & State Energy West Campus, LLC
Slide 7: Attractive Service Territory
Attractive Service Territory The Madison area and Dane County lead the state in population growth. Our service territory is a growing and diverse community of urban, suburban and rural communities. Home to the flagship University of Wisconsin at Madison Robust biotech industry and entrepreneurial co
Slide 8: Earnings and Dividends per Share Growth
Earnings and Dividends per Share Growth Earnings Per Share Dividends Paid Per Share $3.50 $1.60 $3.00 $1.40 $1.20 $2.50 $1.00 $2.00 $0.80 $1.50 $0.60 $1.00 $0.40 $0.50 $0.20 $- $- 2016 2017 (1.) 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 (1.) 2017 Non-Regulated earnings per share includes one
Slide 9: Strong Track Record of Regulated Asset Growth
Strong Track Record of Regulated Asset Growth 9
Slide 10: Accelerating Transition Toward Cleaner Energy
Accelerating Transition Toward Cleaner Energy Track Record of Increasing Pace of Decarbonization • MGE’s clean energy transition has reduced emissions while maintaining top-ranked electric reliability, strengthening key infrastructure, and providing affordable power to customers • 2015: Energy 2030
Slide 11: Plan to Eliminate Coal-Fired Generation from Portfolio by 2035
Plan to Eliminate Coal-Fired Generation from Portfolio by 2035 MGE, along with its co-owners WP&L (operator and majority owner) and WPSC, announced plans to retire the approximately 1,100-MW coal-fired Columbia Energy Center. • MGE currently owns 19% of the facility (216 MW) • Unit 1 planned to be r
Slide 12: Rapidly Expanding Clean Energy Portfolio
Rapidly Expanding Clean Energy Portfolio Planned wind, solar and battery storage resources comprise nearly 50% of planned capital investment (2022-2024). Current and proposed clean energy projects will grow MGE’s renewables capacity by over 9x since 2015. In Progress - Regulatory Approval Granted In
Slide 13: Focus on Clean Energy & Progress Toward Net-Zero Carbon
Focus on Clean Energy & Progress Toward Net-Zero Carbon Actual and Projected Capital Expenditures Forecasted $250 $238 $212 $218 $203 $205 $200 $114 $164 $96 $ Millions $153 $150 $119 $106 $102 $58 $50 $100 $124 $122 $50 $108 $106 $97 $103 $103 $84 $93 $72 - 2015 2016 2017 2018 2019 2020 2021 2022P
Slide 14: Renewables Transition Driving Strong Growth
Renewables Transition Driving Strong Growth MGE Rate Base as Authorize/Proposed by PSCW MG&E Rate Base as Authorized/Proposed by PSCW ($ millions) 2015 2017 2019 2020 2021 2022 2023p Electric Utility 575.9 570.8 842.6 860.5 1,019.1 1,044.4 1,159.2 Gas Utility 158.1 175.8 233.4 250.7 282.4 299.3 312.
Slide 15: Constructive Regulatory Environment
Constructive Regulatory Environment Both S&P and Moody’s view the Wisconsin regulatory environment as highly credit supportive with timely operating and capital cost recovery, and view MGE's relationship with the Public Service Commission as constructive. • Regulatory approvals of utility-scale rene
Slide 16: PSCW Approved 2022-2023 Rate Case / Filed 2023 Reopener
PSCW Approved 2022-2023 Rate Case / Filed 2023 Reopener Approved Settlement Terms Test Year 2022 Test Year 2023 ($000’s where applicable) Average Electric Rate Base $1,044,362 $1,159,155(1) Average Gas Rate Base $299,319 $312,270 Regulatory Equity Layer 55.63% 55.63% Authorized ROE 9.80% 9.80% Elect
Slide 17: ESG Summary
ESG Summary Leadership Safety Workforce • Environmental and Sustainability Policy • Safety Steering Team – examines safety • Career development and training • Sustainability Executive Team topics and prioritizes continuous programs to increase job proficiency and improvement opportunities to improve
Slide 18: Electric Vehicles and Deep Decarbonization
Electric Vehicles and Deep Decarbonization: MGE has been advancing alternative fuel vehicles since the launch of its public charging network more than a decade ago. Electrification of fleet vehicles • The company has set a fleet goal of 100% all-electric or plug-in hybrid light-duty vehicles by 2030
Slide 19: Electric Vehicles and Deep Decarbonization
Electric Vehicles and Deep Decarbonization: New fast-charging hub MGE continues to advance sustainable transportation with construction of a new electric vehicle fast-charging Hub in downtown Madison’s Capitol East District. MGE's Charge@Home Program • Under MGE’s Charge@Home tariff, MGE installs Le
Slide 20: Commitment to Dividends & Shareholder Value
Commitment to Dividends & Shareholder Value • Recent dividend increase was approximately 5% • Increased dividend in August 2021 for the 46th consecutive year • Paid dividends for more than 110 years • Dividend payout ratio in the 50-60% range in recent years • No dividend payout range targeted • Div
Slide 21: Company Highlights
Company Highlights Diversified Customer Base and Revenue Profile Regulated, Highly Visible Growth Resilient Revenue Stream and Customer Base Historical 5-Year Regulated PPE(1) CAGR of 8.0% • Electric service to ~159,000 customers located in the city of Madison and • Forecasted capital investment of
Slide 22: Appendix
Appendix 22
Slide 23: Strong Credit Ratings
Strong Credit Ratings (1) S&P (UTILITY RATINGS) MOODY’S (UTILITY RATINGS) Corporate credit AA- Secured Aa2 Business risk Excellent Unsecured A1 Commercial paper A-1+ Commercial paper P-1 Outlook Stable Outlook Stable • Effective management of regulatory risk • Rating reflects a credit supportive reg
Slide 24: Total Shareholder Return
Total Shareholder Return Period Ending December 31, 2021 Period Ending December 31, 2021 28.7% 19.9% 18.5% 17.1% 16.6% 14.8% 12.9% 13.2% 11.0% 11.0% 12.0% 6.9% MGEE EEI Index Russell 2000 S&P 500 1 Year 5 Year 10 Year 24
Slide 25: MGE – Quarterly Electric Sales Growth
MGE – Quarterly Electric Sales Growth Three Months Ended March 31 25
Slide 26: MGE – Quarterly Gas Sales Growth
MGE – Quarterly Gas Sales Growth Three Months Ended March 31 2022 2021 % Heating Degree Days (Normal 3,529) 3,718 3,593 +3.5% 26
Slide 27: Diluted EPS by Segment
Diluted EPS by Segment Three Months Ended March 31 27
Slide 28: Diluted EPS by Segment
Diluted EPS by Segment Twelve Months Ended December 31 28
Slide 29: Electric Utility Mix
Electric Utility Mix Twelve Months Ended December 31, 2021 29
Slide 30: Gas Utility Mix
Gas Utility Mix Twelve Months Ended December 31, 2021 30
Slide 31: AGA Financial Forum May 2022
AGA Financial Forum May 2022 For more information visit: mgeenergy.com Ken Frassetto Director Shareholder Services and Treasury Management kfrassetto@mge.com 608-252-4723 P.O. Box 1231 Madison WI 53701-1231 31