Mge Energy Inc. · NASDAQ:MGEE
Mge Energy — EEI Financial Conference 2024
33 slides from Mge Energy's conference presentation, November 2024
Slide 1: EEI Financial Conference November 2024
EEI Financial Conference November 2024
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 – Forward Looking Information
Cautionary Note – 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 uncertainties
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 to providing safe, reliable, affordable and sustainable energy to power our
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 EPS CAGR of 6%, Regulated PPE(1) CAGR of ~7% • Electric service to ~163,000 customers located in • Forecasted capital investment of ~$1.4B fr
Slide 6: Earnings and Dividends Growth
Earnings and Dividends Growth Diluted Earnings Per Share Dividends Per Share $3.50 $1.75 $3.00 $1.50 $2.50 $1.25 $2.00 $1.00 $1.50 $0.75 $1.00 $0.50 $0.50 $0.25 $- $- 2018 2019 2020 2021 2022 2023 2018 2019 2020 2021 2022 2023 6
Slide 7: Focused on Sustainability and Reliability
Focused on Sustainability and Reliability Projected Capital Expenditures $350 $312 $286 $296 $300 $266 $250 $240 $182 $202 $200 $174 $ millions $156 $131 $150 $100 $50 $109 $110 $112 $114 $110 $0 2025 2026 2027 2028 2029 Other Capital Expenditures, including Electric and Gas Distribution Generation
Slide 8: Expanding Renewables Portfolio
Expanding Renewables Portfolio MGE MGE MGE Nameplate Estimated Solar Projects Investment Ownership Capacity In-Service Date ($M) Interest (MW) Paris Solar(a) 20 $36 10% 2024 Strix Solar 6 $12 100% 2024 Darien Solar(a) 25 $48 10% 2025 Koshkonong Solar(a) 30 $70 10% 2026 Sunnyside Solar(b) 20 $42 100%
Slide 9: Expanding Renewables Portfolio
Expanding Renewables Portfolio MGE MGE MGE Nameplate Estimated Wind Projects Investment Ownership Capacity In-Service Date ($M) Interest (MW) Badger Hollow Wind(b) 11.2 $36 10% 2027 Whitetail Wind(b) 6.7 $23 10% 2027 MGE MGE MGE Nameplate Estimated Battery Projects Investment Ownership Capacity In-S
Slide 10: Transition Toward Cleaner Energy
Transition Toward Cleaner Energy Track Record of Accelerating 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 framework in
Slide 11: Plan to Eliminate Coal-Fired Generation
Plan to Eliminate Coal-Fired Generation MGE remains on track to end the use of coal as a generation fuel source and meet its 80% carbon reduction goal by 2030 • MGE has no sole ownership of coal-fired generation. • MGE is committed to reliability and affordability as it works toward deep decarboniza
Slide 12: Transmission Investment Outlook
Transmission Investment Outlook MGE Energy anticipates material transmission investment opportunities later this decade through ATC. ATC Projected Capital Expenditures • MGE Energy holds 3.6% equity ownership interest in ATC. $1,400 ATC projects new capital expenditures peaks in 2024 and beyond, wit
Slide 13: Natural Gas Distribution – Emissions Reductions Beyond Carbon
Natural Gas Distribution – Emissions Reductions Beyond Carbon Building upon our long-standing commitment to providing affordable, sustainable energy, MGE has set a goal to achieve Net-Zero Methane Emissions from its natural gas distribution system by 2035. • MGE is working to reduce overall emission
Slide 14: 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. Supportive regulatory framework including: •
Slide 15: PSCW Regulators
PSCW Regulators WISCONSIN PARTY TERM BEGAN TERM ENDS COMMISSIONERS Summer Strand (Chair) D Mar 2023 Mar 2029 Kristy Nieto* D Feb 2024 Mar 2025 Marcus Hawkins* D Apr 2024 Mar 2027 * Pending confirmation • Recent appointments of PSCW Commissioners and confirmation of Chair • Constructive rate outcomes
Slide 16: 2024/2025 Rate Case Outcomes
2024/2025 Rate Case Outcomes TERMS APPROVED APPROVED ($000’s where applicable) 2024 TY 2025 TY Average Electric Rate Base $1,185,550 $1,241,502 Average Gas Rate Base $335,533 $341,369 Average Common Stock Equity $917,952 $945,483 Regulatory Equity Layer 56.13% 56.06% Authorized ROE 9.70% 9.70% 1.54%
Slide 17: Customer Affordability
Customer Affordability Average residential electric customer bill as % of Wisconsin median household income 2.25% 2.12% 2.00% MGE works hard to keep cost at an affordable level for all customers. An 1.75% MGE residential electric customer bill 1.67% as a percentage of customer wallet at 1.51% is bel
Slide 18: Inflation Reduction Act of 2022 (IRA)
Inflation Reduction Act of 2022 (IRA) The IRA supports MGE’s carbon reduction strategy and increases flexibility toward meeting customer needs for affordable and reliable clean energy resources. Positioned to deliver material benefits to customers • Long-term extension of tax credits aligns with c
Slide 19: Strong Credit Ratings
Strong Credit Ratings 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 • Credit supportive regulatory environment •
Slide 20: Electric Vehicles and Deep Carbonization
Electric Vehicles and Deep Carbonization MGE has been supporting the adoption of alternative fuel vehicles since the launch of its public charging network more than a decade ago and anticipates continued electrification of transportation could drive incremental sales growth over the long term. Elect
Slide 21: ESG Highlights – Sustainability Snapshot
ESG Highlights – Sustainability Snapshot 21
Slide 22: ESG Highlights
ESG Highlights MGE works to embody our mission as your community energy company and to foster equity and inclusivity in our service to customers and in our workplace. We Power Safety. Work Safe. Home Safe. • MGE is committed to maintaining a safe working environment and a philosophy of continuous im
Slide 23: ESG Highlights
ESG Highlights Our Board of Directors has a strong commitment to corporate responsibility and accountability. Community-focused and with a breadth and diversity of experience, board members bring strong effective oversight in their service to MGE Energy. Lead Independent Director • Has extensive aut
Slide 24: ESG - Disclosures
ESG - Disclosures Below are links to ESG information: Corporate Responsibility and Sustainability Report • CDP Climate Change Questionnaire • EEI Qualitative Template • EEI Quantitative Template • EEO-1 Data Report Statement on Human Rights Code of Ethics Occupational Health and Safety Policy Report
Slide 25: Appendix
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Slide 26: Corporate Structure
Corporate Structure Over 98% of MGE Energy assets are dedicated to regulated and quasi-regulated utility operations. Central Wisconsin Madison Gas and MGE Transco MGE Transco, MGE State Energy MGE Services, MGE Power LLC MAGAEL, LLC Development Electric Company Investment LLC LLC Services, LLC (3) L
Slide 27: Service Territory Highlights
Service Territory Highlights MGE’s service territory is a growing and diverse community of urban, suburban and rural communities. The Madison area and Dane County lead the state of Wisconsin in population growth. • Seat of state government • Home to the flagship University of Wisconsin – Madison • R
Slide 28: Third Quarter - EPS by Segment
Third Quarter - EPS by Segment Three Months Ended September 30 2024 2023 $0.06 $0.17 $0.05 ($0.01 ) $0.16 ($0.00) ($0.06) ($0.02) Diluted EPS Diluted EPS $1.13 $1.05 $0.97 $0.86 Electric Utility Gas Utility NonReg Energy Transmission Other MGE Energy Electric Utility Gas Utility NonReg Energy Transm
Slide 29: Year-to-Date - EPS by Segment
Year-to-Date - EPS by Segment Nine Months Ended September 30 2024 2023 $0.17 $0.16 $0.50 $0.46 ($0.02 ) ($0.04) $0.24 $0.29 Diluted EPS Diluted EPS $2.72 $2.70 $1.83 $1.83 Electric Utility Gas Utility NonReg Energy Transmission Other MGE Energy Electric Utility Gas Utility NonReg Energy Transmission
Slide 30: Strong Record of Regulated Asset Growth
Strong Record of Regulated Asset Growth $2,500 $2,000 Net PP&E + CWIP ($millions) $1,500 $1,000 $500 $- 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 3Q 2024 30
Slide 31: Electric Utility Mix
Electric Utility Mix Twelve Months Ended December 31, 2023 Electric Revenues Electric Volumes Electric Customers 56% 53% 87% 13% 36% 28% 8% 11% 5% 3% Residential Commercial Industrial Other 31 Note: Categories may not sum due to rounding
Slide 32: Gas Utility Mix
Gas Utility Mix Twelve Months Ended December 31, 2023 Gas Revenues Gas Volumes Gas Customers 37% 90% 38% 58% 36% 10% 27% 4% Residential Commercial/Industrial Other 32 Note: Categories may not sum due to rounding
Slide 33: For more information, visit mgeenergy.com
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 33