Eversource Energy (d/b/a) · NYSE:ES
Eversource Energy (d/b/a) — Eversource Energy — Non-Deal Roadshow (March 2019)
29 slides from Eversource Energy (d/b/a)'s roadshow presentation, March 2019
Slide 1: March Investor Meetings
March Investor Meetings March 4-6, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement All per share amounts in this presentation are reported on a diluted basis. The only common equity securities that are publicly traded are common shares of Eversource Energy. The earnings and EPS of each business do not represent a direct legal interest in the assets and liabil
Slide 3: Eversource's Total Return Has Outperformed in Both the Short and Long Term
Eversource’s Total Return Has Outperformed in Both the Short and Long Term Total Shareholder Return 2018 3-Year 5-Year 10-Year Eversource 6.4% 40.1% 80.4% 279.4% EEI Index 3.7% 36.0% 68.5% 176.4% S&P 500 -4.4% 30.4% 50.3% 243.0% 2
Slide 4: Dividend Growth Continues to Outperform Peers
Dividend Growth Continues to Outperform Peers Annualized Dividend $2.50 $2.14 $2.02 5% - 7% $2.00 $1.90 $1.78 $1.67 $1.57 +$0.12 $1.50 +$0.12 +$0.12 $1.00 +$0.11 +$0.10 $0.50 $0.10 $0.00 2014 2015 2016 2017 2018 2019 Payout 60% 59% 59% 61% 62% Ratios: 3
Slide 5: Strong Long-Term Earnings Growth Expected to Continue
Strong Long-Term Earnings Growth Expected to Continue $2.81 $3.40 to $3.50 $3.25 $3.11 $2.81 $2.96 $2.53 $2.65 $2.28 2012A* 2013A* 2014A* 2015A* 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E *Excludes merger and integration costs 4
Slide 6: Creating the Leading Offshore Wind Platform in the Northeast
Creating the Leading Offshore Wind Platform in the Northeast Acquired 50% of Orsted’s Deepwater Wind Northeast portfolio on February 8th 4,000 MW of development potential with Bay State Wind 830 MW of awarded PPA at prices that exceed recent Massachusetts award Lower development costs – redu
Slide 7: 2018 Distribution Rate Decisions
2018 Distribution Rate Decisions CL&P Rate Settlement Yankee Gas Rate Settlement Aquarion MA Rate Order Effective date: 11/15/18 Effective Date: 5/1/18 Authorized ROE: 9.3% Effective date: 11/1/18 Authorized ROE: (previous 8.83%) Provides additional 9.25% Step rate increases in revenue
Slide 8: FERC Transmission ROE Update
FERC Transmission ROE Update • Order issued: 10/16/18 • Current base: 10.57%; Cap: 11.74% • Illustrative base: 10.41%; Cap: 13.08% • New methodology that averages DCF, CAPM, risk premium, expected earnings • Provides path forward to resolve 2011, 2012, 2014 and 2016 complaints against New England tr
Slide 9: 2019 Guidance
2019 Guidance EPS Range $3.40 - $3.50 Key Drivers Compared to 2018 Results • Distribution rate increases • Transmission rate base growth • Lower non-tracked O&M • Growth in distribution capital tracking programs • Higher depreciation and property taxes • Higher interest expense 8
Slide 10: Projected Capital Expenditures For Core Businesses
Projected Capital Expenditures For Core Businesses $12.75 Billion 2019-2023 $3,500 $2,971 $3,000 $2,830 $199 $185 $109 $2,599 $2,472 $102 $2,401 $2,435 $2,346 $2,500 $137 $152 $459 $112 $ in Millions $2,168 $131 $128 $14 $404 $133 $127 $335 $126 $143 $138 $473 $2,000 $271 $439 $483 $476 $1,145 $1,21
Slide 11: Nearly $1.5 Billion Increase in 2019-2021 Core Business Capex Since February 2018 Plan
Nearly $1.5 Billion Increase in 2019-2021 Core Business Capex Since February 2018 Plan Up $593 $4,000 million $3,500 $3,480 Up $558 $2,887 $3,000 million $2,500 $2,306 $ in Millions Up $177 $2,000 $1,748 million $1,500 $1,371 $1,194 Up $12 Up $120 million million $1,000 $467 $500 $335 $347 $347 $0 E
Slide 12: Rate Base by Core Business – Current and Future
Rate Base by Core Business – Current and Future $24.5 billion 5% 47% 15% $16.650% billion Note: Excludes NPT and 5% rate base investments 10% 46% through equity interest: (e.g. Bay State Wind) 48% 42% 37% 34% 2017 Year-End Rate Base Projected 2023 Year-End Rate Base Transmission, ex NPT Electric Dis
Slide 13: Progress on Major Transmission Reliability Projects
Progress on Major Transmission Reliability Projects Greater Boston Reliability Solution Greater Hartford Central Connecticut (GHCC) • 28 upgrades including seven new transmission lines, new substations and substation expansion projects • 27 projects for Greater Hartford, Manchester, • 16 projects in
Slide 14: Projected Investment in Pipe Replacements 2016-2023
Projected Investment in Pipe Replacements 2016-2023 All With Timely Cost Recovery $228 Consistent with our sustainability $216 strategy, we replaced 59 miles of $199 cast iron and steel pipe with safer, more durable plastic in 2018. $179 $162 $120 $117 $114 $ in Millions $117 $104 $115 $117 $93 $59
Slide 15: Incremental Investments Expected to Grow Aquarion Rate Base Nearly 3 Times Faster
Incremental Investments Expected to Grow Aquarion Rate Base Nearly 3 Times Faster Than Before Eversource Acquisition $1,200 Year- End Rate Base $ in Millions $1,110 $1,030 $950 $890 $820 $740 $760 $690 $710 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E 2023E 14
Slide 16: Aquarion Water's $200 Million Plan to Improve SW CT Supplies
Aquarion Water’s $200 Million Plan to Improve SW CT Supplies Transmission Main Improvements Supply Improvements • Phase 1 – Water mains complete $10 million • Cannondale Well Diversion Permit Application • Phase 2 – Stamford mains projected $14 million filed with DEEP (Additional 1 MGD) • Project co
Slide 17: What Would be Additive to the Cap Ex Forecast?
What Would be Additive to the Cap Ex Forecast? • Grid modernization at CL&P, PSNH • AMI • Northern Pass • New off-shore wind RFP success 16
Slide 18: NSTAR Electric Clean Energy and Grid Modernization Initiatives
NSTAR Electric Clean Energy and Grid Modernization Initiatives Solar: • Completed construction on 62 MW; total cost to be approximately $170 million • 17 of 19 sites now in service Storage: • Planning and permitting under way on $55 million of projects on Cape Cod and Martha’s Vineyard • Completion
Slide 19: Sources of Funds to Execute Our Five-Year Cap Ex and Offshore Wind Investment Plan
Sources of Funds to Execute Our Five-Year Cap Ex and Offshore Wind Investment Plan Operating cash flows New debt financings Approximately $2 billion of new equity Using $100 million/year of Treasury shares to fund dividend reinvestment and employee stock plans We expect to grow EPS around th
Slide 20: Factors Expected to Spur 2023 EPS Growth in Addition to Rate Base Growth
Factors Expected to Spur 2023 EPS Growth in Addition to Rate Base Growth Improved capital structure resulting from 2018 rate reviews Improved results at distribution companies that underearned their allowed returns in 2018, including NSTAR Electric which is allowed to earn up to 12% Earnings f
Slide 21: We Continue to Meet or Exceed Our Commitments to Investors
We Continue to Meet or Exceed Our Commitments to Investors Results Delivered: Our Commitments: Seven-year average EPS and dividend growth of 1. Exceed industry EPS and dividend 6.1% and 7.5%, respectively, through 2018. Growth growth driven by robust regulated Cap Ex program and effective cost contr
Slide 22: Appendix
APPENDIX EVERS=SURCE ENERGY 21
Slide 23: 2018 vs. 2017 Financial Results
2018 vs. 2017 Financial Results Full Year Full Year Q4 2018 Q4 2017 Change Change 2018 2017 Electric Distribution $0.24 $0.33 ($0.09) $1.44 $1.57 ($0.13) Electric Transmission $0.31 $0.32 ($0.01) $1.34 $1.23 $0.11 Natural Gas Distribution $0.14 $0.08 $0.06 $0.29 $0.23 $0.06 Water Distribution $0.01
Slide 24: Projected Transmission Capital Expenditures
Projected Transmission Capital Expenditures $1,200 $994 $987 Other concepts $1,000 under $856 $889 development $194 $164 $800 $119 $155 $746 $ in Millions $133 $334 $573 $548 $600 $302 $431 $399 $116 $491 $120 $123 $400 $434 $309 $293 $466 $244 $200 $338 $432 $392 $179 $148 $135 $124 $0 2016A 2017A
Slide 25: Transmission Rate Base Growth Projections
Transmission Rate Base Growth Projections $9,000 $8,400 $8,020 $8,260 $8,000 $7,680 $1,350 $7,230 $1,270 $1,200 $7,000 $1,170 $6,660 $1,040 $5,983 $ in Millions $920 $6,000 $5,534 $765 $709 $3,480 $3,650 $3,770 $5,000 $3,160 $2,940 $2,690 $4,000 $2,507 $2,305 $3,000 $2,000 $3,050 $3,250 $3,350 $3,34
Slide 26: Status of Grid Modernization and Advanced Metering Infrastructure (AMI)
Status of Grid Modernization and Advanced Metering Infrastructure (AMI) in Massachusetts and Connecticut Massachusetts (D.P.U. 15-122) Connecticut (Docket # 17-12-03) - May 2018 decision approved $133 - PURA currently reviewing distribution million in grid facing investments in company planning and
Slide 27: Status of Northern Pass
Status of Northern Pass Regulatory Hurdles Cleared: New Hampshire Departments of Environmental Services and Transportation NHPUC authorization to commence business as a public utility and to cross public lands and waters NHPUC approval of PSNH – NPT lease settlement Federal DOE Presidential
Slide 28: Summary of ADIT-Related Regulatory Activity
Summary of ADIT-Related Regulatory Activity Eversource Effective Date of 1/1/2018 Change in Tax Rate Prior to Utility & Excess ADIT Refund Timing New Tax Rate Effective Date of New Rates Jurisdiction Reflected in Rates Connecticut January 1, 2018 through April 30, 2018 fully Refunds will be incorpor
Slide 29: More Than $1 Billion of Higher Cost Debt Matures Through 2020
More Than $1 Billion of Higher Cost Debt Matures Through 2020 2019 Maturities Issuer Size Rate Maturity (in millions) CL&P $250 5.50% 2/1/19 Yankee Gas $50 5.26% 11/1/19 ES Parent $350 4.50% 11/15/19 PSNH $150 4.50% 12/1/19 2020 Maturities Issuer Size Rate Maturity (in millions) NSTAR Gas $125 4.46%