Fortis Inc. · TSX:FTS
Fortis — Investor Day (September 2019)
82 slides from Fortis's investor day presentation, Sep 10, 2019
Slide 1: Working Together Powering Growth: 2019 Investor Day
WORKING TOGETHER POWERING GROWTH 2019 INVESTOR DAY September 10, 2019
Slide 2: Investor Day Agenda
INVESTOR DAY AGENDA Welcoming Remarks 9:30 – 9:35 a.m. ET Linda Apsey – ITC Holdings Corp. Growth Strategy Update 9:35 – 10:20 a.m. ET Barry Perry – Fortis Inc. Break 10:20 – 10:30 a.m. ET Financial Outlook 10:30 – 11:15 a.m. ET Jocelyn Perry – Fortis Inc. Closing Remarks and Q&A 11:15 – 11:30 a.m.
Slide 3: Growth Strategy Update
BARRY PERRY FORTIS INC. PRESIDENT & CEO GROWTH STRATEGY UPDATE
Slide 4: Forward Looking Information
FORWARD LOOKING INFORMATION Fortis includes forward-looking information in this presentation within the meaning of applicable Canadian securities laws and forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (collectively referred to as "forward-looki
Slide 5: Investor Day Objectives
INVESTOR DAY OBJECTIVES ROLL-OUT ROLL-OUT NEW IDENTIFY CLEAR EXHIBIT SHOWCASE NEW 5-YEAR 5-YEARPLAN PLAN FINANCIAL OBJECTIVES INNOVATION BENCH STRENGTH 5 5
Slide 6: A Geographically Diverse Energy Delivery Business
A Geographically Diverse Energy Delivery Business 6
Slide 7: High Quality Portfolio of Operations
HIGH QUALITY PORTFOLIO 10 OPERATIONS Canada, U.S. & Caribbean 3.3M CUSTOMERS 2.0M Electric & 1.3M Gas ~99% REGULATED UTILITY ASSETS ~93% TRANSMISSION & DISTRIBUTION $28B 2019F RATE BASE ~66% EARNINGS FROM THE U.S. Note: All information as at June 30, 2019 7
Slide 8: Key Industry Trends
KEY INDUSTRY TRENDS Move to Renewables LNG for Transportation Grid Resiliency Battery Storage Cybersecurity ESG Evolving Customer Needs Regulatory Change Renewable Gas Electric Vehicles Grid Modernization 8
Slide 9: Our New Five-Year Plan
OUR NEW FIVE-YEAR PLAN $18.3B ~7% ~6% CAPITAL RATE BASE DIVIDEND PLAN GROWTH GROWTH GUIDANCE 9
Slide 10: Focused Strategy
FOCUSED STRATEGY STRATEGY Leverage the operating model, 6% footprint of our businesses, operating expertise, reputation and Average Annual Dividend financial strength to execute on Focused on Growth Target through 2024 growth opportunities Growth AREAS OF FOCUS: Capital Customer & Sustainability & S
Slide 11: 12 Month Lookback
12 MONTH LOOKBACK 45 consecutive annual dividend 1st Sustainability Report issued Waneta Asset Sale Completed payment increases in Fall 2018 Updated Report issued in July 2019 $484M Net Gain booked in Q2 2019 5.9% ~US$400M debt repaid through Dividend Tender Offer Increase in Q4 ‘18 2019 Capital Gui
Slide 12: Superior Average Annualized Total Shareholder Returns
SUPERIOR AVERAGE ANNUALIZED TOTAL SHAREHOLDER RETURNS 1-Year 5-Year 10-Year 20-Year 33.6% 14.6% 12.4% 13.9% 27.4% 9.6% 9.7% 9.7% 4.4% 4.1% 7.3% 7.0% Fortis S&P/TSX Capped Utilities Index S&P/TSX Composite Index Note: As at August 30, 2019 12
Slide 13: Sustainability: Primarily an Energy Delivery Business
SUSTAINABILITY: PRIMARILY AN ENERGY DELIVERY BUSINESS 93% of our assets relate to electricity poles, wires and natural gas lines that enable a cleaner energy future 13
Slide 14: Sustainability: It's How We Do Everything
SUSTAINABILITY: IT’S HOW WE DO EVERYTHING Ranked Top Decile on Governance Matters(1) Focused on Delivering Women represent Cleaner Energy • 60% of Head Office • 42% of Board • Carbon Intensity Decreased 63% since 2015 • 1/3 of Executive team • Renewable Generation in Arizona Named a 2019 Outperforme
Slide 15: Sustainability: Committed to Safety and Reliability
SUSTAINABILITY: COMMITTED TO SAFETY AND RELIABILITY FOR EMPLOYEES AND CUSTOMERS Electricity Customer Average All Injury Frequency Rate (1) 2.5 4.5 Outage Duration (Hours) 4.0 2.0 1.90 3.5 3.0 1.5 1.53 2.5 2.0 1.0 1.5 SAFETY RELIABILITY 0.5 1.0 0.5 0.0 0.0 2014 2015 2016 2017 2018 2014 2015 2016 2017
Slide 16: Path to Cleaner Energy
PATH TO CLEANER ENERGY Generation Shifting from Fossil Fuel to Solar and Wind Projects Capital Investment in a Green Electric Vehicle Penetration and Resilient Grid Renewable Gas at Energy Efficiency FortisBC CLEANER ENERGY 16
Slide 17: Path to Cleaner Energy: Provincial and State Goals
PATH TO CLEANER ENERGY: PROVINCIAL AND STATE GOALS BC: 80% Greenhouse Gas Reduction by 2050 CLEANBC: 15% Renewable Gas by 2030 NY: 70% Renewables by 2030 NY: 100% Carbon Free by 2040 IL: 25% Renewables by 2026 MI: 15% Renewables by 2021 AZ: 15% Renewables by 2025 MN: 26.5% Renewables by 2025 KS: 20%
Slide 18: Path to Cleaner Energy: ITC Building the Grid of the Future
PATH TO CLEANER ENERGY: ITC BUILDING THE GRID OF THE FUTURE ~16,000 OPPORTUNITIES BEYOND THE PLAN Miles of Transmission & 560 New 3GW and 7GW of battery storage in MISO Access to MISO multi-value projects at capacity upon completion Substations Technologies Regional and SPP queues Markets ~6,600MW G
Slide 19: Path to Cleaner Energy: Arizona Focused on Renewables
PATH TO CLEANER ENERGY: ARIZONA FOCUSED ON RENEWABLES TEP’s RESOURCE TRANSITION Renewable Energy % Renewable Energy Production of 28% by 2021 TEP Target of 30% Renewables by 2030 (1) Projects developed through purchase power agreements 19
Slide 20: Path to Cleaner Energy: TEP Collaborating with Local University
PATH TO CLEANER ENERGY: TEP COLLABORATING WITH LOCAL UNIVERSITY TO CREATE NEW GOALS TEP’s TEP’s Renewable Current Energy Mix Target Developing New Carbon 28% 30% Emission Goals With 13% University of Arizona’s Institute of the Environment 2018 2021 2030 20
Slide 21: Path to Cleaner Energy: Leading Innovation at FortisBC
PATH TO CLEANER ENERGY: LEADING INNOVATION AT FORTISBC Renewable Gas Natural Gas for Road and Electric Vehicles Energy Conservation & Marine Transportation Efficiency Incentive Program 21
Slide 22: 2020-2024 Capital Plan
2020-2024 CAPITAL PLAN 43% 32% $18.3B Capital Plan (1) TRANSMISSION DISTRIBUTION $4.3 $4.0 $3.6 $3.7 $3.7 $3.2 $3.3 $3.0 Billions 18% 7% OTHER(2) GENERATION 2017A 2018A 2019F 2020F 2021F 2022F 2023F 2024F (1) Capital expenditures are translated at a forecast USD/CAD foreign exchange rate of $1.32. (
Slide 23: Low Risk, Highly Executable $18.3B Capital Plan
LOW RISK, HIGHLY EXECUTABLE $18.3B CAPITAL PLAN Sustaining(1) 59% Growth(2) 27% U.S. 54% Canada 41% Smaller Projects 80% Other(3) 14% Caribbean 5% Major Projects(4) 20% (1) Capital expenditures required to ensure continued and enhanced performance, reliability and safety. (2) Capital expenditures re
Slide 24: Strong Rate Base Growth Across Portfolio of Utilities
STRONG RATE BASE GROWTH ACROSS PORTFOLIO OF UTILITIES(1) $2.2B 5-YEAR RATE BASE CAGR OF ~7% RATE BASE 8.2% Central Hudson $38.4B 6.8% FortisBC(2) 6.5% UNS Energy $28.0B 6.4% ITC 5.9% Other Regulated Utilities(3) 2019F 2024F (1) Rate base is translated at a forecast USD/CAD foreign exchange rate of $
Slide 25: Growth Expected to Extend Beyond 2024
GROWTH EXPECTED TO EXTEND BEYOND 2024 FortisOntario: Municipal Utility FortisBC: Consolidation Renewable Gas, Tilbury LNG & Gas Maritime Electric, Infrastructure Central Hudson & Newfoundland Power: Grid Modernization ITC: Lake Erie Connector, Connecting Renewables & Grid Modernization UNS Energy: R
Slide 26: Three Largest Utilities Account for 2/3 of Capital Plan
GROWTH EXPECTED BEYOND 2024: THREE LARGEST UTILITIES ACCOUNT FOR 2/3 OF CAPITAL PLAN TODAY’S 5-YEAR $4.9B $3.8B $3.4B CAPITAL PLAN • Generation shift to renewables: • Resiliency: • TEP target of 30% renewables 9 years • Tilbury LNG storage ahead of schedule • Significant renewable capacity and batte
Slide 27: Energy to Innovate
ENERGY TO INNOVATE Energy Impact Partners ACTING LOCALLY, ELECTRIFICATION OF THINKING GLOBALLY TRANSPORTATION TRUSTED Energy FORTIS FortisBC Offers INNOVATION Affordable Partner NETWORK Renewable Gas Options will lead to significant reduction of Carbon Capture CARBON FOOTPRINT Testing Innovation Tec
Slide 28: Outperforming Historical Capital Plans
OUTPERFORMING HISTORICAL CAPITAL PLANS 2016 INVESTOR DAY(1) 2017 INVESTOR DAY 2018 INVESTOR DAY $19.3B $18.8B $17.3B $18.2B $14.5B $12.9B 2017-2021 CAPITAL PLAN 2018-2022 CAPITAL PLAN 2019-2023 CAPITAL PLAN ORIGINAL PLAN ACTUAL/CURRENT FORECAST 28 (1) Released in conjunction with Q3 2016 earnings
Slide 29: Dividend Guidance Supported by Growth Strategy
DIVIDEND GUIDANCE SUPPORTED BY GROWTH STRATEGY $2.5 6% 46YEARS $2.0 AVERAGE ANNUAL OF CONSECUTIVE $1.5 DIVIDEND DIVIDEND INCREASES GROWTH GUIDANCE $1.0 EXTENDED TO 2024 $0.5 72 73 74 76 78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20F 22F 24F Dividend payments Forecast Dividend Pay
Slide 30: Financial Outlook
JOCELYN PERRY FORTIS INC. EVP & CFO FINANCIAL OUTLOOK
Slide 31: Clear Financial Objectives
CLEAR FINANCIAL OBJECTIVES Execute Growth Strengthen Strategy Credit Metrics Deliver 6% Average Annual Dividend Growth 31
Slide 32: Strong Financial Track Record Continues
STRONG FINANCIAL TRACK RECORD CONTINUES 5-YEAR HISTORICAL EPS GROWTH ~8% (1) $2.47 $2.51 EPS 5-Year CAGR $2.33 $2.11 $1.75 ~6% (2) 69% Rate Base CAGR 66% 73% 66% 65% Rate Base 5-Year CAGR - ~68% (1) 2014A 2015A 2016A 2017A 2018A Adjusted EPS(1) Dividend Payout Ratio(1) Average Dividend Payout Ratio
Slide 33: 5-Year Capital Plan
5-YEAR CAPITAL PLAN(1) (billions) Regulated 99% ITC $ 4.9 FortisBC 3.8 UNS Energy 3.4 Other Utilities 2.3 FortisAlberta 2.2 $12.9B Central Hudson 1.6 Non-Regulated $1.6B 0.1 Total 2020-2024 Capital Plan $ 18.3 Non-Regulated 1% (1) Capital expenditures are translated at a forecast USD/CAD foreign exc
Slide 34: 2020-2024 Rate Base
2020-2024 RATE BASE(1) $10B $38.4 $36.8 $32.5 $34.5 Rate base grows over $30.7 to $38.4B $28.0 during 5-year period Rate base CAGR of ~7% 2019F 2020F 2021F 2022F 2023F 2024F Regulated - Independent Electric Transmission (ITC) Regulated - U.S. Electric & Gas Regulated - Canadian & Caribbean Electric
Slide 35: The Shift to Cleaner Energy Driving Incremental Investments
THE SHIFT TO CLEANER ENERGY DRIVING INCREMENTAL INVESTMENTS 5-YEAR CAPITAL PLAN(1) +$300M $1.0B $18.3B +$300M $17.3B +$200M +$200M FOREIGN EXCHANGE(1) 2019-2023 2020-2024 Capital Plan Capital Plan (1) Capital expenditures for 2020-2024 are translated at a forecast USD/CAD foreign exchange rate of $1
Slide 36: Wind Interconnections Driving Growth at ITC
WIND INTERCONNECTIONS DRIVING GROWTH AT ITC Incremental growth driven by : • +$200M to interconnect customers and cleaner energy 9% +9% $4.9B resources to the grid. Five-year plan includes: • Wind Interconnections $4.5B • ITC Michigan: 1,500MW • ITC Midwest: 400MW • Solar Interconnections • ITC Mich
Slide 37: LNG Driving Growth at FortisBC
LNG DRIVING GROWTH AT FORTISBC +9% $3.8B Incremental capital driven by addition of regulated Tilbury 1B • Further expansion driven by developing marine bunkering market $3.5B • Order-in-Council received from the BC Government • Project includes additional liquefaction and piping to a marine jetty •
Slide 38: Shift to Cleaner Energy Driving Growth at CUC
SHIFT TO CLEANER ENERGY DRIVING GROWTH AT CUC Incremental capital of $200M driven by grid enhancements, +50% $600M alternative energy projects and utility scale solar projects outlined in Integrated Resource Plan (IRP) $400M • IRP accepted by regulator in early 2019 • Calls for 100MW of renewable en
Slide 39: Major Capital Projects
MAJOR CAPITAL PROJECTS(1) Expected to be Total 2020- Expected Year of ($Millions) Incurred to the 2024 Plan Completion End of 2019 ITC Multi-Value Regional Transmission Projects 646(2) 276 2023 ITC 34.5 kV to 69 kV Transmission Conversion Project 345(2) 268 Post-2024 UNS Southline Transmission Proje
Slide 40: Strong Near-Term Growth
STRONG NEAR-TERM GROWTH +$2B of Incremental Capital Added to 2019-2023 Capital Plan $5.0 $4.3 $4.0 $4.0 $0.6 $3.7 $3.7 $0.5 $3.6 $0.1 $0.4 $0.4 $3.3 $3.0 BILLIONS $2.0 $3.7 $3.5 $3.6 $3.2 $3.3 $3.3 $1.0 $0.0 2019F 2020F 2021F 2022F 2023F 2024F 2018 Investor Day Capital Incremental Capital 40
Slide 41: 2020-2024 Funding Plan
2020-2024 FUNDING PLAN Cash From Operations(1) 73% Debt Primarily at Operating Utilities 5-Year Subsidiary Balance Sheets Reflects Approved Levels Capital Plan of Improved Credit Metrics $18.3B Maintaining Investment-Grade Credit Ratings Debt(2) Ample Liquidity 24% ATM(3) 3% (1) Cash from operations
Slide 42: Strengthening Credit Metrics
STRENGTHENING CREDIT METRICS CREDIT RATINGS RECOVERING FROM U.S. TAX REFORM 2018 2019F A- / BBB+ CFO/Debt(1) ~10.5% ~11% Holdco Debt/Total Debt (1) ~39% ~36% BBB (high) Baa3 “Fortis has a very strong business risk profile, which is a key credit 2020-2024 Business Plan strength. More than 95% of its
Slide 43: Manageable Debt Maturities and Ample Liquidity
MANAGEABLE DEBT MATURITIES AND AMPLE LIQUIDITY CONSOLIDATED FIXED-TERM DEBT MATURITIES(1) CONSOLIDATED CREDIT FACILITIES 5-year average ~$1.0B Billions $2.0 $4.1 $1.5 Billions $1.0 $0.5 2020F 2021F 2022F 2023F 2024F ($millions) 2020F 2021F 2022F 2023F 2024F Total $1.2 Canadian and Caribbean Regulate
Slide 44: Regulated Utilities Have Strong Investment-Grade Credit Ratings
REGULATED UTILITIES HAVE STRONG INVESTMENT-GRADE CREDIT RATINGS Company ITC Regulated Subsidiaries A A1 n/a TEP A- A3 n/a Central Hudson A- A3 n/a FortisBC Energy n/a A3 A FortisBC Electric n/a Baa1 A (low) FortisAlberta A- Baa1 A (low) Newfoundland Power n/a A2 A 44
Slide 45: Foreign Exchange Sensitivity
SENSITIVITY EXPOSURE FOREIGN EXCHANGE 2020 EPS Impact For every 5 cent change in the 25 basis point change in ROE at ITC ~$0.03 USD:CAD exchange rate 25 basis point change in ROE at UNS Energy ~$0.02 5-Year Rate Base CAGR = 6 cent impact on 2020 EPS Additional $1B in Capital Expenditures ~30 BPS 45
Slide 46: Locally Managed Customer and Regulatory Relationships
LOCALLY MANAGED CUSTOMER AND REGULATORY RELATIONSHIPS AFFORDABILITY FOR SAFETY & CUSTOMERS & REPUTATION & FINANCIAL & STRATEGIC RELIABILITY COMMUNITY CREDIBILITY OBJECTIVES 46
Slide 47: Current Regulatory Outlook
CURRENT REGULATORY OUTLOOK • Final decision pending from FERC on • TEP rate case filed with the ACC • 2020-2024 Multi-Year Rate Plan MISO Base ROE on April 1, 2019 using a filed in March 2019 December 31, 2018 test year • Notice of Inquiries issued by FERC in 2019 on incentive policies for transmiss
Slide 48: Current Regulatory Compact
CURRENT REGULATORY COMPACT Weighted Average Allowed ROE(1) Weighted Average Equity Thickness(1) 10.38% 55.4% 9.69% 48.6% 8.73% U.S. Utilities 39.0% Canadian Utilities Combined (1) Based on 2019 forecast rate base and capital structure 48
Slide 49: 5-Year Regulatory Calendar
5-YEAR REGULATORY CALENDAR FortisBC 2020-2024 Rate Plan TEP Expects New Rates TEP Expects New Rates 2020 2021 2022 2023 2024 Alberta Generic Central Hudson Central Hudson Cost of Capital Expects New Rates Expects New Rates Commences for Effective July 1st Effective July 1st 2021 and 2022 ITC Annual
Slide 50: Five-Year Plan Highlights
FIVE-YEAR PLAN HIGHLIGHTS 5-year 5-year rate base CFO/ Debt capital plan of CAGR of Improves $18.3B ~7% Average ~200 up $1B Annual Dividend Guidance basis points(1) from prior plan of 6% Average annual Rate base extended Holdco Debt/ Total Debt capital expenditure increases to 2024 Improves ~700 of
Slide 51: Why Invest in Fortis?
WHY INVEST IN FORTIS? WELL-RUN HIGHLY FOCUSED ON STRONG VIRTUALLY ESG 6% INNOVATIVE BUSINESSES DIVERSIFIED ENERGY GROWTH ALL LEADER DIVIDEND DELIVERY PROFILE REGULATED GUIDANCE 51
Slide 52: Appendix
FORTIS... APPENDIX
Slide 53: Table of Contents
TABLE OF CONTENTS UTILITY OVERVIEW EXECUTIVE BIOGRAPHIES ITC Holdings Corp. 54 – 56 Barry Perry, Fortis Inc. – President & CEO 77 UNS Energy 57 – 59 Jocelyn Perry, Fortis Inc. – EVP & CFO 77 Central Hudson 60 – 61 Linda Apsey, ITC Holdings Inc. – President & CEO 78 FortisBC 62 – 65 Roger Dall’Antoni
Slide 54: ITC Holdings Corp.
ITC HOLDINGS CORP. Type of Utility Transmission Regulator FERC Regulatory Model Independent Transmission Company 2019 Regulatory Compact 11.07-12.16% ROE on 60% equity 2019F Rate Base(1) $8.8B 5-Year Rate Base CAGR(1) 6.4% 2018 Assets % of Total Consolidated 38% Regulated Assets(2) Multi-Value Regio
Slide 55: ITC's 5-Year Capital Plan
ITC’s 5-YEAR CAPITAL PLAN 2020-2024 CAPITAL(1) $3.3B Infrastructure Investments Rebuild, reliability, resiliency, system efficiencies, increased Infrastructure capacity, circuit overloads, pocket load growth Investments $600M Major Capital Projects Multi-Value Regional Transmission Projects & 34.5kV
Slide 56: ITC's Major Capital Projects
ITC’s MAJOR CAPITAL PROJECTS Expected to be Total 2020- Expected Year Major Capital Projects ($M) Incurred to the 2024 Plan of Completion End of 2019 Multi-Value Regional Transmission Projects 646(1) 276 2023 • MVP 5 Hickory Creek Line comprised of ~100-mile 345kV transmission line from Iowa to Wisc
Slide 57: UNS Energy
UNS ENERGY Tucson Electric UNS Electric UNS Gas Type of Utility Electricity Gas distribution Regulator Arizona Corporation Commission Regulatory Model Cost of service/historical test year 9.75% ROE on 9.5% ROE on 9.75% ROE on 2019 Regulatory Compact 50% equity 52.8% equity 50.8% equity 2019F Rate Ba
Slide 58: UNS Capital Plan
UNS CAPITAL PLAN 2020-2024 CAPITAL(1) Distribution $1.1B Distribution Infrastructure Infrastructure Generation Customer meter infrastructure, grid resiliency, Diversification modernization $3.4B $700M Generation Diversification Reciprocating engines, 250MW Wind $900M Transmission Infrastructure Dire
Slide 59: Major Capital Projects: UNS
MAJOR CAPITAL PROJECTS: UNS Expected to be Total 2020- Expected Year Major Capital Projects ($M) Incurred to the 2024 Plan of Completion End of 2019 Southline Transmission Project 102 441 2022 • 600MW transmission line spanning across Southern New Mexico and Southern Arizona • Joint effort with Hunt
Slide 60: Central Hudson
CENTRAL HUDSON Type of Utility Gas and Electricity New York State Public Service Regulator Commission Regulatory Model Cost of service on future test year 2019 Regulatory Compact(1) 8.8% ROE on 49% equity(1) 2019F Rate Base(2) $1.9B 5-Year Rate Base CAGR(2) 8.2% 2018 Assets % of Total Consolidated R
Slide 61: Central Hudson Capital Plan
CENTRAL HUDSON CAPITAL PLAN 2020-2024 CAPITAL(1) Distribution Infrastructure $900M Distribution Infrastructure Distribution Automation and Modernization $250M Transmission Infrastructure $1.6B Replacement of Aging Infrastructure $450M IT, General and Other IT, General and Other Transmission Infrastr
Slide 62: FortisBC
FORTISBC FortisBC Gas FortisBC Electric Type of Utility Gas distribution Electricity Regulator British Columbia Utilities Commission Regulatory Model Cost of service + PBR 2019 Regulatory Compact 8.75% ROE on 38.5% equity 9.15% ROE on 40.0% equity 2019F Rate Base $4.5B $1.3B 5-Year Rate Base CAGR 7.
Slide 63: FortisBC Capital Plan
FORTISBC CAPITAL PLAN 2020-2024 CAPITAL $1.9B Sustainment & Customer Growth Ongoing maintenance requires significant capital investment Sustainment & Includes customer growth and general plant investment Customer Growth $1.1B Major Integrity Projects Inland Gas Upgrades Project Transmission Integrit
Slide 64: FortisBC Major Capital Projects
FORTISBC MAJOR CAPITAL PROJECTS Expected to be Total 2020- Expected Year of Major Capital Projects ($M) Incurred to the 2024 Plan Completion End of 2019 Lower Mainland Intermediate Pressure System 397 72 2020 Upgrade • Replacement of 20kms of intermediate pressure gas lines in Metro Vancouver area I
Slide 65: FortisBC Major Capital Projects (Continued)
FORTISBC MAJOR CAPITAL PROJECTS (CONTINUED) Expected to be Total 2020- Expected Year Major Capital Projects ($M) Incurred to the 2024 Plan of Completion End of 2019 Eagle Mountain Woodfibre Gas Line - 350 2023 • 47-km gas line will service a small-scale, third-party owned facility for export to Asia
Slide 66: FortisAlberta
FORTISALBERTA Type of Utility Electricity distribution Regulator Alberta Utilities Commission Regulatory Model PBR 2019 Regulatory Compact 8.5% ROE on 37% equity 2019F Rate Base $3.5B 5-Year Rate Base CAGR 4.1% 2018 Assets % of Total Consolidated 9% Regulated Assets(1) (1) Includes goodwill 66
Slide 67: FortisAlberta Capital Plan
FORTISALBERTA CAPITAL PLAN 2020-2024 CAPITAL Distribution Infrastructure $1.9B Distribution Infrastructure Safety & Reliability of Distribution Assets, Meter $2.2B Upgrades, Pole Management Program, Modernization IT, General $300M IT, General and Other and Other 67
Slide 68: Other Electric Utilities
OTHER ELECTRIC UTILITIES (1) Type of Utility Electricity Newfoundland and Labrador Board of Regulator Ontario Energy Board Island Regulatory and Appeals Commission Commissioners of Public Utilities Regulatory Model Cost of service with incentives Cost of service on future test year Cost of service o
Slide 69: Other Electric Utilities (Continued)
OTHER ELECTRIC UTILITIES (CONTINUED) (1) Type of Utility Electricity Regulator Utility Regulation and Competition Office Government of the Turks and Caicos Islands Regulatory Model Cost of service Cost of service 2018 Achieved ROE 11.62% 8.95% 2019F Rate Base(2) $0.7B $0.4B 5-Year Rate Base CAGR(2)
Slide 70: Other Electric Capital Plan
OTHER ELECTRIC CAPITAL PLAN 2020-2024 CAPITAL Distribution Infrastructure $900M Distribution Infrastructure Newfoundland Power and Caribbean Utilities $600M Generation Diversification IT, General $2.3B Caribbean Utilities Shift to Cleaner Energy and Other $600M Transmission Infrastructure Generation
Slide 71: Other Electric Major Capital Projects
OTHER ELECTRIC MAJOR CAPITAL PROJECTS Expected to be Total 2020- Expected Year of Major Capital Projects ($M) Incurred to the 2024 Plan Completion End of 2019 Wataynikaneyap Transmission Power Project(1) 188 437 2023 • Partnership with 24 First Nations to connect remote communities in Northern Ontar
Slide 72: 2019-2024 Rate Base by Segment
2019-2024 RATE BASE BY SEGMENT (1) Rate Base 3-Year CAGR 5-Year CAGR ($billions) 2019F 2020F 2021F 2022F 2023F 2024F to 2022 to 2024 Regulated - Independent Electric Transmission (2) ITC 8.8 9.5 10.2 10.8 11.4 12.0 7.2% 6.4% Regulated - US Electric & Gas UNS Energy 5.0 5.8 6.1 6.4 6.8 6.9 8.6% 6.5%
Slide 73: 2020-2024 Capital Plan by Segment
2020-2024 CAPITAL PLAN BY SEGMENT Capital Forecast(1) 2020-2024 ($millions) 2020F 2021F 2022F 2023F 2024F TOTAL Regulated - Independent Electric Transmission ITC 976 987 1,043 1,018 922 4,946 Regulated - US Electric & Gas UNS Energy 1,160 677 575 526 441 3,379 Central Hudson 292 309 359 306 292 1,55
Slide 74: Non-US GAAP Reconciliations
NON-US GAAP RECONCILIATIONS Reconciliation ($Millions, except as noted) 2014 2015 2016 2017 2018 Formula Net earnings attributable to common equity shareholders 317 728 585 963 1,100 a Adjusting items: Unrealized loss (gain) on mark-to-market of derivatives 6 (26) 10 Consolidated state income tax el
Slide 75: Non-US GAAP Reconciliations (Continued)
NON-US GAAP RECONCILIATIONS (CONTINUED) Reconciliation 2014 2015 2016 2017 2018 Formula Earnings per common share ($) 1.41 2.61 1.89 2.32 2.59 d Adjusted earnings per common share ($) 1.75 2.11 2.33 2.47 2.51 e Dividends paid per common share ($) 1.280 1.400 1.525 1.625 1.725 f Dividend payout ratio
Slide 76: Executive Team
EXECUTIVE TEAM Barry Perry President & CEO Jocelyn Perry Jim Reid Nora Duke James Laurito Gary Smith David Hutchens EVP, CFO EVP, CLO & EVP, Sustainability & EVP, Business Development & EVP, Eastern Canadian & EVP, Western Utility Operations, Corporate Secretary CHRO CTO Caribbean Operations Preside
Slide 77: Executive Biographies
EXECUTIVE BIOGRAPHIES BARRY PERRY JOCELYN PERRY FORTIS INC. – PRESIDENT & CEO FORTIS INC. – EVP & CFO Mr. Perry’s career with the Fortis Group spans nearly 20 years. Ms. Perry has an extensive career in the utility business, having worked He was previously Vice President of Finance and Chief Financi
Slide 78: Executive Biographies
EXECUTIVE BIOGRAPHIES LINDA APSEY ROGER DALL’ANTONIA ITC HOLDINGS INC. – PRESIDENT & CEO FORTISBC – PRESIDENT & CEO Mrs. Apsey is President and CEO of ITC Holdings Corp. In this role, she is responsible for the Mr. Dall’Antonia is President and CEO of the FortisBC group of companies. Prior to strate
Slide 79: Executive Biographies
EXECUTIVE BIOGRAPHIES NORA DUKE CHARLES FRENI FORTIS INC. – EVP, SUSTAINABILITY & CENTRAL HUDSON – PRESIDENT & CEO CHIEF HUMAN RESOURCE OFFICER Ms. Duke’s career with the Fortis Group spans 30 years. She was Mr. Freni is the President and Chief Executive Officer of Central Hudson previously Presiden
Slide 80: Executive Biographies
EXECUTIVE BIOGRAPHIES DAVID HUTCHENS JIM LAURITO FORTIS INC. – EVP, WESTERN UTILITY OPERATIONS FORTIS INC. – EVP, BUSINESS DEVELOPMENT & CHIEF TECHNOLOGY OFFICER Mr. Hutchens’s career in the energy sector spans more than 20 years Mr. Laurito served as President and Chief Executive Officer of Central
Slide 81: Executive Biographies
EXECUTIVE BIOGRAPHIES MICHAEL MOSHER JIM REID FORTISALBERTA – PRESIDENT & CEO FORTIS INC. – EVP, CHIEF LEGAL OFFICER & CORPORATE SECRETARY Mr. Mosher brings more than 25 years of utility and energy industry Mr. Reid was previously a partner with Davies Ward Phillips & Vineberg experience, serving in
Slide 82: Executive Biographies
EXECUTIVE BIOGRAPHIES GARY SMITH FORTIS INC. – EVP, EASTERN CANADIAN & CARIBBEAN OPERATIONS Mr. Smith has held a number of senior leadership positions with the Fortis Group throughout his 30-year tenure. He was previously President and Chief Executive Officer of Newfoundland Power; Vice President of