Uil Co. Ltd. · KRX:049520
Uil — Williams Capital Group East Coast Seminar (August 2011)
32 slides from Uil's conference presentation, Aug 10, 2011
Slide 1: Williams Capital Group East Coast Seminar
Exhibit 99.1 Williams Capital Group East Coast Seminar August 10, 2011 1
Slide 2: Note to Investors
Note to Investors Safe Harbor Provision Certain statements contained herein, regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). These include statements regarding management’s intentions, plans, belief
Slide 3: UIL - Corporate Structure, Service Areas
UIL - Corporate Structure, Service Areas UIL Holdings Corporation Service Area Key UI SCG CNG Berkshire Overlapping Territory The United Illuminating Southern Connecticut Gas Connecticut Natural Gas Berkshire Gas Company Company (UI) (SCG) (CNG) (Berkshire) › Service territory: 335 sq › Service terr
Slide 4: Investment Highlights
Investment Highlights Attractive Regulated › Proven ability to earn allowed electric & gas rate of returns Electric and Gas › Average ROEs as of 6/30/11: D& CTA 10.13%, preliminary SCG 9.00-9.10%, CNG 10.55 -10.65% Utility › GenConn - 9.75% Transmission Focus › 2011 estimated overall allowed weighte
Slide 5: Gas Operations Integration
Gas Operations Integration Closed on the acquisitions of Southern Connecticut Gas, Connecticut Natural Gas and Berkshire Gas Company on November 16, 2010 Working diligently internalizing the Transition Services Agreement (TSA) Ø Support services such as IT, Finance and Human Resources provided by Ib
Slide 6: Integration
Integration Exit from transition services agreement is on schedule Expected $11.6M of Identified Savings Ø Successful, major SAP system cut over from IUSA to UIL occurred ($M) on 8/1/11 › Finance › Human Resources › Supply Chain › Work Management 6
Slide 7: Potential for Gas Heating in CT
Potential for Gas Heating in CT American Community Survey’s selected housing characteristics estimates show a large percentage of households in Connecticut do not use natural gas for heating Litchfield Hartford (17) Tolland (2) Windham (0) Connecticut (0) 5% 2% 1% 5% 4% 4% 4% 2% 1% 8% 13% 16% 13% 11
Slide 8: Gas Operations
Gas Operations Ø Capitalize on the competitive advantage of natural gas heating use as the economical, abundant and environmentally friendly fuel of choice for customers Ø Aggressively pursue new gas heating customers Ø Generate incremental revenue to support infrastructure expansion and replacement
Slide 9: Gas Operations
Gas Operations Ø Historical customer additions(1) 2009 2010 Heating conversions 5,535 5,728 New construction 901 1,071 Total 6,436 6,799 Ø Targeting 30,000-35,000 additional gas heating customers over the next 3 years › ’11 - 25% increase over ‘10 levels › ’12 - 50% increase over ’10 levels Ø Conver
Slide 10: UIL 2010-2019 CapEx Profile
UIL 2010-2019 CapEx Profile $M The annual long-term capital spending will be updated in the Fall of 2011 *2010 Gas distribution capex reflects the full year amount; UIL ownership was for 6 weeks effective with the closing on the acquisition. ** Updated - February 23, 2011 *** Information as of Novem
Slide 11: 2011 Electric Distribution & Transmission CapEx Detail
2011 Electric Distribution & Transmission CapEx Detail Electric distribution investments Electric transmission investments 12% 19% 20% 27% 4% 26% 31% 11% 50% 11
Slide 12: 2011 Gas Distribution CapEx Detail
2011 Gas Distribution CapEx Detail Gas distribution investments 3% 8% 22% 8% 12% 47% 12
Slide 13: Examples of Current Distribution Projects
Examples of Current Distribution Projects Central Facility - UI Office & Splice Chamber Remediation Operations Building › Consolidate all UI “Work Centers” onto a single › Rebuild deteriorated underground splicing chambers site referred to as the Central Facility › Under construction › Under constru
Slide 14: Near-term Electric Transmission Reliability Upgrades
Near-term Electric Transmission Reliability Upgrades Grand Avenue 115 kV Switching New Shelton 115/ 13.8 kV Station Rebuild Substation › Addresses short circuit capability issues and › Meets Greater Shelton area load growth aged/obsolete infrastructure › In Planning › Under construction › Planned in
Slide 15: GenConn Energy
GenConn Energy 50/50 Joint Venture between UI and NRG Ø Began operating in the ISO-NE markets in June ‘11 Devon Facility Ø Operating Ø Contractual requirements met in September ‘10 15
Slide 16: Near-Term Average Rate Base Profile
Near-Term Average Rate Base Profile Rate Base (Excluding GenConn Equity Investments): $2,309 38% 37% 38% 42% 40% 43% 1% 2% 23% 23% 23% 7% 5% 22% 23% 22% 39% 40% 38% 28% 30% 36% Electric distribution Electric transmission CTA Gas distribution* GenConn Equity Investments: UI’s 50% Share ($M)**: 2010A
Slide 17: UI Transmission - NEEWS Investment
UI Transmission - NEEWS Investment UI Participation in CL&P Project: Ø UI’s portion of investment: greater of $60M or 8.4% of CL&P’s costs for the CT portions … › Greater Springfield Reliability Project › Interstate Reliability Project › Central CT Reliability Project Ø 8.4% currently estimated at a
Slide 18: Renewable-Enabling Transmission
Renewable-Enabling Transmission Significant Region-Wide Need: Potential Solutions Under Study › RPS requirement > 3x current › Need will likely be satisfied by a portfolio available renewables* of projects › One promising example is shown below › CT requirement is > UI’s entire load Vast majority of
Slide 19: Regulatory Update
Regulatory Update SCG Potential Overearnings Generic ROE Proceeding SCG/CNG Rate Case Appeals DPUC schedule has not been updated UI Electric Decoupling Ø On 3/24/11, CNG, SCG & the OCC filed a motion with the DPUC to reopen the CNG & SCG rate cases for the purposes of reviewing and approving a settl
Slide 20: Legislative Highlights
Legislative Highlights Session ended June 8th Ø UIL was actively engaged in legislative process Highlights of Public Act 11-80 Ø Department of Energy & Environmental Protection (DEEP) was created, effective July 1 › Merged the Department of Environmental Protection and the Department of Public Utili
Slide 21: BIL
BIL = a o z Qo = o = a | 21
Slide 22: 2Q & YTD '11 Financial Results by Business
2Q & YTD ’11 Financial Results by Business Net Income ($M) 2Q ’11 vs. 2Q ’10 * YTD ‘11 vs. YTD ’10 * * 2010 - fees associated with acquisition, 2011 - interest on Oct. ’10 issuance of $450M of public debt 22
Slide 23: 2Q & YTD '11 Financial Results - Details
2Q & YTD ‘11 Financial Results - Details Electric distribution, CTA, GenConn & other Ø 18% increase in net income for the quarter & 12% increase on a YTD basis › Increase in earnings primarily attributable to income from the investment in GenConn, partially offset by lower CTA rate base › Both GenCo
Slide 24: Debt Maturity
Debt Maturity Near-Term Debt Maturities ($M) * $3 ** UI Pollution Control Revenue Bonds SCG, CNG & Berkshire UI Equity Bridge Loan repaid in July UIL Debt retired in Feb Berkshire note repaid in May Based on current plans - expect no need for external equity at least through 2013 * $30M to be refina
Slide 25: Assumptions
Assumptions › Regulated businesses are expected to earn the allowed return on an aggregate basis › GenConn expected to earn $0.12-$0.14 per share › CTA earnings are expected to decline by $0.07-$0.09 per share from 2010 as rate base continues to be amortized › Incorporates full year of gas distribut
Slide 26: Credit Ratings
Credit Ratings Issuer S&P Moody’s BBB Baa3 UIL Holdings (Stable) (Stable) United BBB Baa2 Illuminating (Stable) (Stable) BBB Baa2 SCG (Stable) (Stable) BBB Baa1 CNG (Stable) (Stable) BBB Baa2 Berkshire (Stable) (Stable) Maintenance of investment grade credit ratings is an important objective 26
Slide 27: Investment Highlights
Investment Highlights Attractive Regulated › Proven ability to earn allowed electric & gas rate of returns Electric and Gas › Average ROEs as of 6/30/11: D& CTA 10.13%, preliminary SCG 9.00-9.10%, CNG 10.55 -10.65% Utility › GenConn - 9.75% Transmission Focus › 2011 estimated overall allowed weighte
Slide 28: Q&A
Q&A 28
Slide 29: Appendix
Appendix 29
Slide 30: Region-Wide RPS Obligations
Region-Wide RPS* Obligations Region-Wide RPS Obligation thru 2020: Region-Wide Compliance Gap (v. “existing” renewable resources**) forecasted/estimated at ~ 18,000GWh › Unlikely to be satisfied by renewables currently in the ISO-NE queue › Will require significant additional transmission Satisfacti
Slide 31: CT RPS Requirements
CT RPS Requirements Connecticut RPS Requirements (Percentage of Retail Load) Class I resources include energy derived from solar, wind, fuel cell, methane gas from landfills, ocean thermal, wave, tidal, run-of-river hydropower (<5MW, began operation after July 1, 2003), sustainable biomass (NOx emis
Slide 32: Slide 32
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