Uil Co. Ltd. · KRX:049520
Uil — 49th Annual EEI Financial Conference 2014
46 slides from Uil's conference presentation, Nov 12, 2014
Slide 1: 49th Annual EEI Financial Conference
EEI 2014 * 49th Annual EEI Financial ConferenceNovember 2014 Exhibit 99.1
Slide 2: Forward Looking Statements
EEI 2014 * Forward Looking Statements 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, beliefs,
Slide 3: The UIL Family of Regulated Utilities
EEI 2014 * The UIL Family of Regulated Utilities Diversified and virtually 100% regulated electric and gas distribution companies serving in Connecticut & Massachusetts Service territory: 335 sq miles~317,000 customersAllowed Distribution ROE of 9.15%Earned ‘13 Transmission ROE (composite) of 12.2%
Slide 4: Investment Thesis
EEI 2014 * Investment Thesis Investment in regulated electric and gas businesses……Ensuring safety and reliability for customersSatisfying responsibilities as a public utility companyProviding customers access to cleaner and lower cost fuelEnhancing shareholder value by earning regulated returns on i
Slide 5: Proposed Acquisition
EEI 2014 * Proposed Acquisition
Slide 6: PGW Acquisition - Update
EEI 2014 * PGW Acquisition - Update Reports by independent consultant, Concentric, are complete and have been publicly released On October 27th, City Council announced it would not endorse the sale of PGW to UILOn October 28th, we responded that we would make a determination whether to exercise our
Slide 7: Organic Growth - Capex
EEI 2014 * Organic Growth - Capex
Slide 8: $4.2B 10-yr Capital Expenditure Plan
EEI 2014 * $4.2B 10-yr Capital Expenditure Plan(1) (1) Excludes proposed PGW acquisitionAmounts may not add due to rounding 2015P-2024P
Slide 9: Attractive Rate Base Growth
EEI 2014 * Attractive Rate Base Growth(1) (1) Excludes proposed PGW acquisition * Includes Distributed Energy Resources** Includes 338(h)(10) electionAmounts may not add due to rounding ‘15-’19 Rate Base CAGR 7.6% Gas Distribution:8.1%Electric Transmission:6.7%Electric Distribution*:7.7% Previous Fo
Slide 10: Gas Distribution
WIL UIL HOLDINGS Gas Distribution 10 EEI 2014
Slide 11: $1.9B Gas Distribution Capex Forecast
EEI 2014 * $1.9B Gas Distribution Capex Forecast Amounts may not add due to rounding Focused on expanding natural gas infrastructure in line with overall strategy in CT Major Variances 1st 5 years:Inclusion of LNGTiming of gas growthTiming adjustment for replacement services/mains/meters Major Varia
Slide 12: Gas Distribution – Investing in expansion
EEI 2014 * Gas Distribution – Investing in expansion Main and Service Replacement Programs New Business Program LNG Rocky Hill ModernizationProgram LNG Milford Modernization Program Replace Cast Iron and Bare Steel gas mains~ $56M per year*Expand gas distribution system ~ $93M per year*Upgrade exist
Slide 13: Gas Heating Customers - Opportunity
EEI 2014 * UIL Actual ’14 Target CES Gas Heating Customers - OpportunityComprehensive Energy Strategy (CES) & Berkshire Plan CES provides for converting ~280,000 new gas customers state-wide over 10 years~200,000 potential customers are SCG & CNG’s Added over 11,770 households/businesses through Oct
Slide 14: Why Now?
EEI 2014 * Why Now? Lower gas prices in New England from Marcellus ShaleLong-term conversion potential from CES36% of households/businesses on UIL gas mains are not currently customersMain extensions and gas pipe replacement supported by legislation Increased Capital Investments = Increased Rate Bas
Slide 15: Electric Distribution
EEI 2014 * Electric Distribution
Slide 16: $1.2B Electric Distribution Capex Forecast
EEI 2014 * $1.2B Electric Distribution Capex Forecast Amounts may not add due to rounding Focused on infrastructure replacement, capacity & reliability to provide a safer Distribution system Major Variances 1st 5 years:Incremental LED Street Light RelampingRenewables & Enhanced Distribution Mgt move
Slide 17: Electric Distribution - Customer & Safety Driven
EEI 2014 * Replacing transformers ~ $4M per yearRepair/replace aging infrastructure~ $6M per yearReplace streetlights in towns with new LED fixtures and bulbs~ $27M Electric Distribution - Customer & Safety Driven Distribution Transformer Replacement Program Distribution Network Replacement Program
Slide 18: Distributed Energy Resources (DER)
EEI 2014 * Distributed Energy Resources (DER)
Slide 19: $80M DER Capex Forecast
EEI 2014 * $80M DER Capex Forecast Amounts may not add due to rounding Focused on opportunities that provide strategic and economic value 2.2 MW Solar and 2.8 MW Fuel Cell in Bridgeport2.8 MW Fuel Cell in New Haven Renewable Connections
Slide 20: Our Strategy as we transform our Distribution System
EEI 2014 * Our Strategy as we transform our Distribution System Potential Impacts of Increased DER Penetration:Limited reduction in future capacity-oriented investmentsHigher and inequitable customer ratesReduced system reliabilityUIL investment opportunities in DER assetsUIL electric system investm
Slide 21: The Emerging Grid has Opportunities
EEI 2014 * The Emerging Grid has Opportunities
Slide 22: Electric Transmission
EEI 2014 * Electric Transmission
Slide 23: $0.6B Electric Transmission Capex Forecast
EEI 2014 * $0.6B Electric Transmission Capex Forecast Reliability-based Transmission projects to meet the needs in Southwest CT Amounts may not add due to rounding Major Variances 1st 5 years:Additional spend for reliability projects in Southwest CT Major Variances 2nd 5 years:Additional spend for r
Slide 24: Electric Transmission – Meeting the needs of Southwest CT
EEI 2014 * Electric Transmission – Meeting the needs of Southwest CT Pootatuck 115/13.8kV Substation Substation Upgrades Meeting area load growth~ $40M*Addresses condition of infrastructure; upgrades capacity and increases distribution voltage regulation; improves reliability, operability & personne
Slide 25: FERC ROE Complaint
EEI 2014 * FERC ROE Complaint Challenge to Transmission (T) Base ROE: “206” complaints filed at the FERC claiming that current approved base ROE of 11.14% on T investments is not just and reasonable UI recorded a reserve of $3.2M, after-tax, in 3Q ’14, in addition to the $1.5M, after-tax, reserve re
Slide 26: Other Investments
WIL UIL HOLDINGS Other Investments 2 EEI 2014
Slide 27: Peaking Generation & NEEWS
EEI 2014 * Peaking Generation & NEEWS GenConn Energy – Peaking Generation50/50 joint venture between UI & affiliates of NRGRegulated cost of service approachROE, 9.95%50/50 debt/equityNew England East-West Solution Transmission ProjectsUI participation in CT portion of 3 projects – greater of $60M*
Slide 28: Renewables & LNG
EEI 2014 * Renewables & LNG Renewables Connections ProgramPURA approved 2 projects totaling 7.8 MW (allowed up to 10 MW):Bridgeport: 2.2 MW solar & 2.8 MW fuel cellNew Haven: 2.8 MW fuel cellBase ROE:Electric D ROE + 25 basis points, plusRetain a percentage of market revenues, expected to be equival
Slide 29: Opportunities in New England
EEI 2014 * The fuels used to produce New England’s electric energy have shifted as a result of economic and environmental factors“At Risk” Generator retirements have begunRecent & future retirements of non-gas fired generation further threaten reliabilityUIL is an active participant in NESCOE’s prop
Slide 30: Regulatory & Legislative Update
EEI 2014 * Regulatory & Legislative Update
Slide 31: Regulatory Update
EEI 2014 * Regulatory Update Gas Distribution Rate Case – CNGFinal decision issued on 1/22/14 ordered a private letter ruling (PLR) request on 338 (h)(10) issue CT OCC filed an appeal of PURA’s rate case decision, including the PLRAt PURA’s request, CNG and CT OCC entered into settlement discussions
Slide 32: Legislative Update
EEI 2014 * Legislative Update ConnecticutGubernatorial RaceGovernor Dannel Malloy won re-election over Republican challenger Tom FoleyEnergy was not a campaign issueLegislative RacesDemocrats still have majority in both the House & the SenateRepublicans picked up 8 seats in the House & 1 seat in the
Slide 33: Financials
WIL UIL HOLDINGS Financials 33 EEI 2014
Slide 34: Solid Financial Performance
EEI 2014 * Solid Financial Performance YTD ’14 Net Income vs. YTD ’13 Net Income - $M Amounts may not add due to rounding Non-recurring expenses Net income of $77.3M YTD ‘14 & $74.9M YTD ’13 included certain non-recurring after-tax expenses, as detailed aboveYTD earnings, excluding the non-recurring
Slide 35: Debt Maturities & Liquidity
EEI 2014 * Debt Maturities & Liquidity * Remarket $27.5M of UI tax exempt bonds ** Not including Bridge Term Loan AgreementAmounts may not add due to rounding $M
Slide 36: 2014 Earnings Guidance
EEI 2014 * 2014 Earnings Guidanceas of 11/5/14 ‘15 Earnings Guidance will be presented on the 4Q ’14 earnings call
Slide 37: Investment Thesis
EEI 2014 * Investment Thesis Investment in regulated electric and gas businesses……Ensuring safety and reliability for customersSatisfying responsibilities as a public utility companyProviding customers access to cleaner and lower cost fuelEnhancing shareholder value by earning regulated returns on i
Slide 38: Questions
EEI 2014 UIL HOLDINGS 38 Questions
Slide 39: Appendix
WIL UIL HOLDINGS APPENDIX 39 EEI 2014
Slide 40: Proposed Acquisition of PGW
EEI 2014 * Proposed Acquisition of PGW Announced on 3/3/14 Description Acquisition of assets and certain liabilities of Philadelphia Gas Works (“PGW Operations”) Purchase Price Total consideration of $1.86B; PGW Operations acquired on a cash-free and debt-free basis Financing Plan UIL intends to iss
Slide 41: Strategic Rationale for Acquisition
EEI 2014 * Strategic Rationale for Acquisition Growth Opportunities Opportunities to drive long-term growth through infrastructure investments Diversification Increased operational diversification improves business profile and profitability LDC Platform Leverage business expertise, processes and IT/
Slide 42: Current Forecast - Gas Distribution
EEI 2014 * Current Forecast - Gas Distribution * Includes 338(h)(10) electionAmounts may not add due to rounding Capex Rate Base* $M
Slide 43: Previous 10-yr Capex & Rate Base Forecasts
EEI 2014 * Previous 10-yr Capex & Rate Base Forecasts Capex(1) (1) Excludes proposed PGW acquisition* Includes Renewable Generation - $47M ’14-’18 * Excludes proposed PGW acquisition** Includes 338(h)(10) election(1) Includes Renewable Generation(2) Represents investments at UIL CorporateAmounts may
Slide 44: Previous Gas Distribution Capex & Rate Base Forecasts
EEI 2014 * Previous Gas Distribution Capex & Rate Base Forecasts Capex Rate Base * * Includes 338(h)(10) electionAmounts may not add due to rounding
Slide 45: CT Renewable Portfolio Standards
EEI 2014 * CT Renewable Portfolio Standards Connecticut RPS Requirements(Percentage of Retail Load) Class I resources include electricity derived from solar, wind, fuel cell, geothermal, landfill methane gas, anaerobic digestion or biogas, ocean thermal, wave, tidal, run-of-river hydropower (<30MW t
Slide 46: Notes
EEI 2014 * Notes
UIL Holdings — 49th Annual EEI Financial Conference 2014 on 6ix