Nextera Energy, Inc. · NYSE:NEE
Nextera Energy — Edison Electric Institute Conference 2022
64 slides from Nextera Energy's conference presentation, November 2022
Slide 1: Edison Electric Institute Conference
Edison Electric Institute Conference November 2022 1
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results These presentations include 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
Slide 3: NextEra Energy is an industry-leading clean energy company
NextEra Energy is an industry-leading clean energy company 63 GW $166 B $156 B In Operation(1) Market TotalAssets(3) Capitalization(2) Clean Energy Generation Portfolio Integrated Supply Chain, Engineering and Construction The largest electric The world leader in utility in the United electricity ge
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 Total Shareholder Return(1) $2.55 ~8.4% CAGR 976% $0.76 ~620% Outperformance vs. S&P 500 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 Dividends Per Share 357% $1.54 274% 264% 244% 242%
Slide 5: Our disciplined, customer-focused growth strategy has elevated our company to industry leader
Our disciplined, customer-focused growth strategy has elevated our company to the position of industry leader Top 15 Global Utility Equity Market Capitalization(1) As of 6/1/2001 ($ MM) As of 11/11/2022 ($ MM) Rank Market Cap Rank Market Cap 1 $38,574 1 $165,551 NextEra Energy 2 $38,185 2 $119,077 3
Slide 6: S&P recently affirmed NextEra Energy's ESG evaluation, highest in the sector
S&P recently affirmed NextEra Energy’s ESG evaluation, which is the highest in the sector and highlighted its “best in class” preparedness 2022 S&P ESG Evaluation(1) • In our view, no one in any 2022 S&P ESG industry has done more than Evaluation Score(2) NextEra Energy to address CO2 emissions Envi
Slide 7: NextEra Energy has a clear vision and a clear strategy to extend our leadership
NextEra Energy has a clear vision and a clear strategy to extend our leadership in the U.S. clean energy transition which we believe will reduce costs for our customers NextEra Energy Decarbonization Strategy Lead Lead Lead Decarbonization Decarbonization Transmission Decarbonize of the U.S. Buildou
Slide 8: Clean energy transition accelerated by multiple renewable demand drivers
The clean energy transition occurring across the U.S. is being accelerated by multiple renewable demand drivers that support our decarbonization strategy Demand Drivers for New Renewables Economic Sustainability Regulatory High Oil Cost of and Corporate Federal and High Power and Natural RPS(2) Pric
Slide 9: Attractive renewables economics driving transformation of the U.S. generation fleet
Attractive renewables economics are expected to continue driving a transformation of the U.S. generation fleet Estimated Costs of Generation Resources Late-2020s(1) ($/MWh) Near-Firm Wind Near-Firm Wind(2) $14 - $21 Near-Firm Solar Near-Firm Solar(2) $17 - $24 Existing Natural Gas Existing Natural G
Slide 10: Rising power and gas prices and demand for RECs support renewables deployment
We believe rising power and gas prices and demand for renewable energy credits (RECs) further support near-term renewables deployment Market Prices for Renewables Alternatives(1) Forward Power Prices Forward Gas Prices 7x24 ($/MWh) 7x24 ($/MMBtu) $60 $6 ~50% ~45% increase in increase in 5-year forwa
Slide 11: The IRA significantly expands tax incentives for clean energy
The IRA significantly expands tax incentives for clean energy, driving growth for renewables through the next two decades The Inflation Reduction Act (“IRA”) – Potential Impacts Co- Over two Unparalleled located Repowers storage Manufacturing decades of wind and with wind incentives incentives solar
Slide 12: We believe we have the industry's leading growth prospects
We believe we have the industry’s leading growth prospects FPL FPL FPL FPL T&D Under- Battery Energy Infrastructure grounding FPL Solar Storage Services Wholesale FPL Green Solar Fleet Generation Hydrogen & Service Together Hydrogen Territory Electrification Modernization Expansion Expect ~$85-$95 B
Slide 13: Florida Power & Light is recognized as one of the best and most innovative electric providers
Florida Power & Light is recognized as one of the best and most innovative electric providers in the U.S. Florida Power & Light Company Largest electric utility in the U.S. ~5.8 MM customer accounts ~33 GW in operation(1) Areas Served by FPL (in Northwest FL, Counties with Areas Served by FPL) ~$14
Slide 14: We plan to lead by example, decarbonizing FPL's generation fleet
We plan to lead by example, decarbonizing FPL’s generation fleet to reduce fuel costs and customer bills Decarbonize Ourselves • Achieve Real Zero carbon emissions(1) by no later than 2045 • Execute on the largest renewables Decarbonize buildout by an electric utility in the Ourselves country to red
Slide 15: FPL's blueprint for achieving its Real Zero carbon emissions goal
FPL’s blueprint for achieving its Real Zero carbon emissions goal involves strategic actions to drive customer value, including enhanced reliability and resiliency FPL’s Decarbonization Opportunity(1) Solar & Battery Storage + T&D Investment + Green Hydrogen 92 GW 50 GW 16 GW New solar New battery o
Slide 16: Our plan is to deliver Real Zero carbon emissions by no later than 2045
Our plan is to deliver Real Zero carbon emissions by no later than 2045 in a manner that supports the reliability and clean energy needs of Florida’s growing population (GW) FPL’s Path to Decarbonization(1) 180 2040 160 140 2035 120 2045 2030 83%(2) 100 2025 80 100%(2) 62%(2) 60 40 52%(2) 20 36%(2)
Slide 17: Smart capital investments in solar reduce fuel costs
Deploying smart capital investments in solar reduces fuel costs, with IRA making every solar project even more cost- effective for customers Solar Investments • Expect to deploy more than $6 B in smart capital over the next four years for the benefit of customers • ~1.2 GW of rate base solar • ~1.8
Slide 18: Investments in T&D and undergrounding improved reliability and resiliency
Investments in T&D and undergrounding have improved reliability and resiliency while also driving improvements in O&M efficiency, all for the benefit of customers Transmission & Distribution Investments • Expect to invest ~$18 to $20 B in T&D O&M Cost / Customer(1) T&D projects from 2022 to 2025 to
Slide 19: Energy Resources is the leading North American clean energy company
Energy Resources is the leading North American clean energy company NextEra Energy Resources(1) World leader in electricity generated from the wind and sun Wind Natural Gas Nuclear ~28 GW (2) of clean energy in operation Universal Solar 20 GW wind Storage 5 GW solar Other Pipeline 2 GW nuclear Trans
Slide 20: Energy Resources' competitive advantages position us as provider of choice
We believe Energy Resources’ competitive advantages position us to be the clean energy solutions provider of choice for a wide variety of customers Energy Resources Competitive Differentiators Advanced analytics i that enable superior site identification and design Scale of project pipeline and inte
Slide 21: Energy Resources Development Program
Energy Resources remains focused on capitalizing on the push towards decarbonization to continue expanding our industry-leading renewables and storage portfolio Energy Resources Development Program(1) (Signed Contracts and Expectations as of October 28, 2022) 2022 - 2023 2022 - 2023 2024 - 2025 2024
Slide 22: Decarbonization of U.S. economy could create ~$4 trillion renewables and storage opportunity
Decarbonization of the entire U.S. economy could create a ~$4 trillion renewables and storage investment opportunity through 2050 2050 Decarbonized U.S. Economy: Growth in Renewables and Storage Opportunity(1) ~$4 T ~33x ~7,000 GW Excess energy converted to hydrogen to ~$2 T decarbonize other ~17x s
Slide 23: We plan to help other utilities transition to low cost renewables
We plan to help other utilities to transition to low cost renewables Decarbonize the U.S. Power Sector Lead • Help decarbonize other investor-owned Decarbonization utilities, municipalities and of the U.S. Power cooperatives and reduce customer bills Sector • Extend our leadership position in renewa
Slide 24: Energy Resources positioned to expand leadership and help electric sector decarbonize
Energy Resources is well-positioned to expand our leadership position in clean energy and help the U.S. electric sector decarbonize Power Sector Decarbonization Opportunity • Energy Resources has been serving 2050 Energy Resources’ investor-owned utilities, Power Sector Opportunity municipalities an
Slide 25: IRA expanded the opportunity set for repowering wind and solar assets
The IRA has expanded the potential opportunity set for repowering wind and solar assets, and Energy Resources has a proven ability to successfully execute repowerings Renewables Repowering Opportunity • Proven ability to successfully Energy Resources execute repowerings Opportunity Set(1) – Repowere
Slide 26: Operating portfolio is an opportunity to co-locate with battery storage
Energy Resources’ large operating portfolio represents a significant opportunity set to potentially co-locate with battery storage and qualify for investment tax credits Battery Storage Opportunity • FERC Order 845 allows storage Co-Location to use surplus interconnection Opportunity Set(1) capacity
Slide 27: Leverage leading platform to provide full range of decarbonization solutions
We plan to leverage our leading platform, built on decades of development and market experience, to provide a full range of decarbonization solutions for the U.S. economy Decarbonize the U.S. Economy (C&I) Lead • Build new renewables and storage to enable customers beyond the power Decarbonization s
Slide 28: Opportunity to decarbonize other sectors of the U.S. economy
The opportunity to decarbonize other sectors of the U.S. economy includes electrification and reducing consumption of carbon-intensive fuels U.S. Economy Decarbonization Opportunity • There are substantial opportunities 2050 Energy Resources’ to reduce CO2 emissions across Full Economy Opportunity(1
Slide 29: To decarbonize highest emitting sectors, electrify operations or convert to renewable fuels
To decarbonize the highest emitting sectors of the U.S. economy, we will need to electrify their operations or convert customers to renewable fuels such as green hydrogen All Major Sectors Focused On Decarbonization Solutions Decarbonization Customer Pathway Need Electric Power 25% Renewable Powerin
Slide 30: Clean energy product portfolio aligned with customer needs
Energy Resources’ portfolio of clean energy products is strongly aligned with customer needs, which all require new wind, solar and battery storage Clean Energy Product Portfolio Customer Eliminate carbon from Eliminate carbon Requirements electricity supply from core operations Customized wind, Fle
Slide 31: Acquisition of operating landfill gas to electric facilities supports renewable fuels strategy
NextEra Energy recently announced a ~$1.1 B(1) acquisition of several operating landfill gas to electric facilities, which will support our renewable fuels strategy Renewable Natural Gas (RNG) Opportunity • Purchased a portfolio of landfill gas to electric facilities Strategic Rationale • Expect to
Slide 32: Green hydrogen end-uses more economic with $3/kg hydrogen PTC
End-uses for green hydrogen are now more economic with a $3/kg hydrogen PTC and even-lower cost renewables, potentially opening up new markets sooner in the U.S. Green Hydrogen Opportunity • Green hydrogen unlocks new Applications opportunities to build new renewables beyond traditional power sector
Slide 33: Transmission sector on the cusp of unprecedented growth
We believe the transmission sector is on the cusp of unprecedented growth to enable the decarbonization of the U.S. economy Growing Transmission Lead • Invest in competitive transmission Transmission opportunities to further support Buildout to renewables deployment Support New • Leverage existing t
Slide 34: Substantial transmission expansion required to enable broad decarbonization
We believe substantial transmission expansion will be required to enable broad decarbonization of the U.S. economy and represents an attractive investment opportunity Growing NextEra Energy Transmission Near-Term Decarbonization Impact • Actively bidding in competitive • Transmission backbone is on
Slide 35: NextEra Energy's Financial Expectations
We remain well positioned to continue our strong adjusted EPS and dividends per share growth NextEra Energy’s Financial Expectations(1) • Reflects ~10% compound annual growth from 2021 to the $3.45 - high-end of the 2025 adjusted $3.23 - $3.70 EPS expectations range $3.43 $2.98 - $3.13 • From 2021 t
Slide 36: NextEra Energy Value Proposition
We believe NextEra Energy presents a compelling investment opportunity NextEra Energy Value Proposition Drill-down of S&P 500 Companies Adj. EPS CAGR(2) 384 Investment grade(1) >8% <7% 95 Market capitalization > $60 B 55 Adj. EPS CAGR > 8% past 15 years(2) NEE Median S&P 500 35 ‘21 – ‘25E Annual Tot
Slide 37: NextEra Energy Partners
NExTera energy’ PARTNERS 2
Slide 38: NextEra Energy Partners is a best-in-class clean energy company
NextEra Energy Partners is a best-in-class clean energy company with a market capitalization of over $15 B(1) NextEra Energy Partners’ Portfolio(2) ~6,640 MW of wind ~1,530 MW of solar ~240 MW paired storage ~4.3 Bcf total natural Wind gas pipeline capacity(3) Solar Storage Pipeline Stable cash flow
Slide 39: Energy Resources' platform provides significant benefits to LP unitholders
Energy Resources’ operating and development platform provides significant benefits to LP unitholders NextEra Energy Partners’ Competitive Advantages • Benefits from Energy Resources’ best-in-class O&M Scale and development expertise AI / Data Development – Supports organic growth Analytics Expertise
Slide 40: IRA expected to positively impact NEP's long-term growth prospects
The IRA is expected to have a positive transformational impact on several drivers of NEP’s long-term growth prospects NextEra Energy Partners Growth Opportunities NEP CAFD(1) Enhanced Opportunities Growth Avenues with the IRA Acquisitions Third-party Unparalleled from Energy wind and Repowers acquis
Slide 41: NextEra Energy Partners has diversified its financing sources
NextEra Energy Partners has diversified its financing sources over the past five years by opportunistically accessing low-cost alternatives Financial Flexibility • Long-term contracted cash Sources of Capital flows support a range of low- IPO – 2016 2017 – 2021 cost financing alternatives • Superior
Slide 42: NextEra Energy Partners' Financial Expectations
NextEra Energy Partners remains well-positioned to deliver on its long-term growth objectives NextEra Energy Partners’ Financial Expectations Annualized LP DPU(1) Year-End Portfolio Run-Rates ($ MM) $4.45 - $2,220 - $4.95 $3.98 - $2,420 $4.30 $1,785 - $3.55 - $1,985 $3.74 $3.17 - $3.25 $2.83 $770 -
Slide 43: NextEra Energy Partners' Value Proposition
NextEra Energy Partners presents a compelling investment opportunity with total return potential of 16% to 20% per year through at least 2025 NextEra Energy Partners’ Value Proposition Drill-down of S&P 1000 Companies Illustrative Investor Total & NextEra Energy Partners Return Potential ~1% 16% - 2
Slide 44: Appendix
Appendix NexTera’ Nexvera energy’ ENERGY & PARTNERS Z 44
Slide 45: NEXTCra’
NEXTCra’ ENERGY &
Slide 46: Real Zero plan includes interim CO2 rate reduction milestones
Our Real Zero plan includes clear interim CO2 rate reduction milestones to measure our progress over the coming years NextEra Energy Decarbonization Milestones(1) 2005 // 2025 2030 2035 2040E 2045E CO2 Emissions Rate Reduction NextEra Energy expected emissions rate reduction(2) 70% 82% 87% 94% Real
Slide 47: ESG Highlights
NextEra Energy has been recognized by S&P for its ESG leadership and “best-in-class” preparedness ESG Highlights(1) Environment Customers(2) • NextEra Energy announced a zero-carbon • 28% lower bills than the national average blueprint to achieve Real Zero Emissions • 65% better operating costs than
Slide 48: NextEra Energy Credit Metrics
NextEra Energy’s credit metrics remain on track NextEra Energy Credit Metrics A- Downgrade Actual Target S&P Range Threshold 2021 2022 FFO/Debt 13% - 23% 20% 21.8% >20% Debt/EBITDA 3.5x - 4.5x 4.0x <4.5x Baa Downgrade Actual Target Moody’s Range Threshold 2021 2022 CFO Pre-WC/Debt 13% - 22% 17% 17.4
Slide 49: Energy Resources' increased renewables market share driven by competitive advantages
We believe Energy Resources’ increased renewables market share is driven by its competitive advantages 2019-2021 Renewables Signed Contracts(1) GW 20 18 Wind Solar Storage 16 14 ~33% ~16% ~36% 12 share of share of share of 20.7 GW 54.3 GW 10.2 GW 10 market market market 8 6 4 2 0 Energy Resources So
Slide 50: Energy Resources Renewables Development Program
Energy Resources Renewables Development Program(1,2) Wind 2022-2023 2024-2025 Northeast 111 0 Southeast 0 0 Midwest 1,095 859 Texas 2,652 1,344 West 944 651 Total 4,802 2,854 Solar 2022-2023 2024-2025 Northeast 62 950 Southeast 783 2,431 Midwest 940 1,905 Texas 400 735 West 1,595 470 Total 3,779 6,4
Slide 51: 2022 Inflation Reduction Act – Key Provisions
The recently passed Inflation Reduction Act significantly expanded tax incentives for clean energy, which we believe will further stimulate renewables development in the U.S. 2022 Inflation Reduction Act (“IRA”) – Key Provisions(1) • Extends 100% PTC through at minimum, the later of: Wind and Solar
Slide 52: 2022 Inflation Reduction Act – Key Provisions
Along with expanded and new tax incentives, the IRA introduced new tax provisions, specifically the ability to transfer tax credits to third parties 2022 Inflation Reduction Act (“IRA”) – Key Provisions(1) • 10-year $3/kg PTC, indexed for inflation(2) Clean Hydrogen • Preserves wind and solar PTC on
Slide 53: IRA introduces a corporate minimum tax of 15% on pre-tax book income
The IRA also introduces a corporate minimum tax(1) of 15% on pre-tax book income Corporate Minimum Tax (“CMT”) Summary • Introduces a CMT for tax years Considerations after 2022 equal to 15% of pre- tax book income (PTBI) ✓ Can deduct accelerated • PTBI gets adjusted to reflect depreciation (MACRS)
Slide 54: Corporate Minimum Tax Summary (Continued)
Under IRA, companies will need to pay taxes at the greater of regular tax and the corporate minimum tax Corporate Minimum Tax (“CMT”) Summary (Continued) Regular Tax CMT Starting Point? Taxable income Pre-tax book income Deduct Tax Yes, can use MACRS Yes, can use MACRS Depreciation? (or Bonus if eli
Slide 55: 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) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016(2) 2017(2) 2018 2019 2020 2021 Earnings Per Share Attributable to NextEra Energy, Inc. (assuming dilution) $ 0.58 $ 0.81 $ 0.82 $ 1.
Slide 56: 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, the effects of non-qualifying hedges and unrealized ga
Slide 57: 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 safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical facts, bu
Slide 58: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) effectiveness of NextEra Energy's risk management tools associated with its hedging and trading procedures to protect against significant losses, including the effect of unforeseen price variances from historical behavior;
Slide 59: NextEra Energy Partners
NExTera energy’ PARTNERS La
Slide 60: NextEra Energy Partners Credit Metrics
NextEra Energy Partners’ credit metrics remain on track NextEra Energy Partners Credit Metrics BB Downgrade Actual Target S&P(1) Range Threshold 2021(4) YE 2022 FFO/Debt 12% - 20% 12% 18.1% >15% HoldCo Debt/EBITDA 5.0x - 6.0x 6.0x 5.4x <6.0x Ba1 Downgrade Actual Target Moody's (2) Range Threshold 20
Slide 61: Definitional information
Definitional information NextEra Energy Partners, LP. Adjusted EBITDA and CAFD Expectations This presentation refers to adjusted EBITDA and CAFD expectations. Adjusted EBITDA, CAFD, limited partner distributions and other expectations assume, among other things, normal weather and operating conditio
Slide 62: 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 63: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NEP may not be able to extend, renew or replace expiring or terminated power purchase agreements (PPA), natural gas transportation agreements or other customer contracts at favorable rates or on a long-term basis; If the en
Slide 64: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NEP's ability to make distributions to its unitholders depends on the ability of NEP OpCo to make cash distributions to its limited partners; If NEP incurs material tax liabilities, NEP's distributions to its unitholders ma
NextEra Energy — Edison Electric Institute Conference 2022 on 6ix