NYSE:ES Eversource Energy Q2 2023 Earnings Report $57.38 -0.68 (-1.17%) Closing price 04/17/2025 03:59 PM EasternExtended Trading$57.44 +0.05 (+0.09%) As of 04/17/2025 04:33 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast Eversource Energy EPS ResultsActual EPS$1.00Consensus EPS $0.91Beat/MissBeat by +$0.09One Year Ago EPS$0.86Eversource Energy Revenue ResultsActual Revenue$2.63 billionExpected Revenue$2.94 billionBeat/MissMissed by -$310.70 millionYoY Revenue Growth+2.20%Eversource Energy Announcement DetailsQuarterQ2 2023Date7/31/2023TimeAfter Market ClosesConference Call DateTuesday, August 1, 2023Conference Call Time9:00AM ETUpcoming EarningsEversource Energy's Q1 2025 earnings is scheduled for Thursday, May 1, 2025, with a conference call scheduled on Friday, May 2, 2025 at 9:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)SEC FilingEarnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Eversource Energy Q2 2023 Earnings Call TranscriptProvided by QuartrAugust 1, 2023 ShareLink copied to clipboard.There are 12 speakers on the call. Operator00:00:00Hello, everyone, and welcome to Eversource Energy's Second Quarter 2023 Earnings Call. My name is Emily, and I'll be coordinating your call today. After the presentation, there will be the opportunity for any questions, which you can ask by pressing star followed by the number one on your telephone keypad. I'll now turn the call over to our host, Investor Relations Director, Robert Becker. Please go ahead, Robert. Speaker 100:00:22Good morning, and thank you for joining us. I'm Bob Becker, Eversource Energy's Director for Investor Relations. During this call, we'll be referencing slides we posted yesterday on our website. And as you can see on Slide 1, some of the statements made during this investor call may be forward looking. These statements are based on management's current expectations And are subject to risk and uncertainty, which may cause the actual results to differ materially from forecasts and projections. Speaker 100:00:50We undertake no obligation to update or revise any of these statements. Additional information about the various factors that may cause actual results to differ And our explanation of non GAAP measures and how they reconcile to GAAP results is contained within our news release, the slides we posted last night And in our most recent 10 ks and 10 Q. Speaking today will be Joe Nolan, our Chairman, President and Chief Executive Officer And John Barrera, our Executive Vice President and CFO. Also joining us today is Jay Booth, our Vice President and Controller. Now, I'll turn the call over to Joe. Speaker 200:01:29Thank you, Bob, and thank you, everyone, for joining us on this call this morning. I hope that you're all having a good summer and can take some time off after earnings season. Today, we'd like to update you on our commitment to deliver value to achieve important objectives on both ESG and diversity and our progress to close out the offshore wind seal process. Starting on Slide 3. Here at Eversource, we are working tirelessly to deliver energy and clean water safely and reliably To our 4,400,000 customers, our steadfast focus on serving our customers well continues to deliver superior results In all aspects of our businesses in Connecticut, Massachusetts and New Hampshire. Speaker 200:02:19As you can see from the bottom of this slide, investments we have made over the past decade are greatly benefiting customers. The average months between interruption has increased significantly from 12 months in 2011 To nearly 20 months at the end of 2022, in over 2 years through the first half of twenty twenty three. As a result, this high performance level puts Eversource's reliability in the top decile compared to industry peers. In addition, when an outage occurs, the average duration experienced by customers has improved dramatically. Our relatively short average duration of outages also puts Eversource in the top decile compared to industry peers. Speaker 200:03:08This top decile level of reliability is the result of years of investment in the states in which we operate And the dedication and the high work of our skilled employees. Turning to Slide 4 On the energy supply side of our customs bill, we're pleased that our customers have experienced some improvement In supply pricing in New England, challenges due to natural gas supply constraints because of the war in Ukraine and the global market dynamics led to last winter's historically high energy prices here in New England. This summer, natural gas prices have moderated nicely, And we're seeing much lower electricity prices as a result. In Connecticut and Massachusetts, new supply rates went into effect on July 1st And will remain in place through the end of the year. Supply rates for residential customers in Connecticut and Massachusetts Decreased approximately 40% per kilowatt hour from January of this year to July 1st this year. Speaker 200:04:18In New Hampshire, residential customers will see a decline of approximately 40% per kilowatt hour in the supply rate effective August 1st, as a reminder, we purchase power on behalf of our customers in accordance with guidelines set by our state regulators And we do not earn any profit from this portion of our customers bill. We are very pleased that our customers have seen some cost relief this summer As it helps to offset customers usage that is much higher in the summer than in the winter. And while 2023 prices have come down in recent months, we expect another seasonal increase in supply prices for this coming winter. Therefore, we remain focused on our industry leading energy efficiency programs and we're continuing to engage with policymakers to discuss long term solutions. To that end, in June, senior leaders actively participated In the FERC sponsored forum in Portland, Maine on gas and electric reliability matters, the topics discussed Include retaining existing natural gas infrastructure and new electric transmission infrastructure needed to connect Onshore and offshore generation and other renewable energy resources. Speaker 200:05:41This was a very well attended meeting That included all 4 FERC commissioners and the state energy policy leaders from across New England. We look forward to continuing the engagement with FERC And other key stakeholders to continue to advance this energy resource challenge for New England. Turning to Slide 5. In June, we posted on Eversource's website our 2022 sustainability report Along with our standalone diversity, equity and inclusion report, these publications highlight our commitment to leading environmental, Social Equity and Governance Practices. We continue to make strong progress towards our 2,030 carbon neutrality goal With a quarter of the emissions already cut from our baseline year of 2018. Speaker 200:06:34To continue progressing toward this target, We're focused on 5 key sources of emissions line loss, natural gas leaks, Energy use across our facilities, fuel use by our fleet and releases of sulfur hexafluoride That is used as an insulator in electrical equipment. The many initiatives we have implemented to drive emissions down are showing results. In fact, from 2021 to 2022, we've seen a 15% overall emissions reduction. These efforts have ranged from enabling more capacity for renewables on the grid to replacing aging leak prone natural gas pipes to investing in hybrid vehicles and procuring renewable energy for our buildings. We're also pursuing innovative Solutions such as a pilot project featuring a first of its kind sulfur hexafluoride free breaker used in our electric system. Speaker 200:07:36And we continue to explore solutions that will enable a decarbonized heating sector. These include our geothermal pilot And evaluating the potential to replace natural gas with low or 0 carbon molecules. As many of you know, we're also expanding our emission reduction efforts through the commitment to adopt an ambitious science based target. Committing to a science based target is a best practice that places us among a handful of industry leaders in the U. S. Speaker 200:08:10And we plan to have our targets submitted by 2024. Turning now to our clean energy effort. In 2022, we invested nearly $800,000,000 in clean energy, including offshore wind, battery storage, Electric vehicle charging and first of a kind utility scale network geothermal energy pilot in Massachusetts. Although we announced our plans to divest of offshore wind assets, Eversource remains committed to supporting the development of important regional clean energy solutions. Slide 6 reflects the many clean energy initiatives underway in Massachusetts To enable the clean energy transition. Speaker 200:08:56As you can see on this slide, Massachusetts has a constructive Regulatory framework that will facilitate over $2,000,000,000 of clean energy investments over the next 5 years. This includes approximately $200,000,000 of FERC approved transmission projects that would enable offshore wind generation to interconnect to our grid. We could potentially see an additional $350,000,000 of transmission investment when Massachusetts issues its next RFP for additional offshore wind generation. And certainly, we can expect this transmission interconnection need to grow as additional offshore generation is procured for the region. We continue to emphasize the need for system investments to support increased electrification and distributed generation To help ease the current reliance on natural gas generation in the region. Speaker 200:09:57Here at Eversource, While we're focused on enabling clean energy transition, we're also focused on enabling an equitable transition. This means protecting communities, industries and people that are at risk of being disadvantaged in the clean energy transition. Now moving to offshore wind. As you see here on Slide 7, we continue to make progress in the development of our offshore wind projects Through our joint venture with we recently achieved some major milestones with the South Fork Wind Project. Construction Of the project's U. Speaker 200:10:37S. Built onshore substation and transmission cable is complete, and the installation of the offshore substation The subsea transmission cable were recently completed. Additionally, wind turbine pre assembly is underway In New London, Connecticut, an installation of offshore towers will begin soon. South Park Wind is on track to become the nation's 1st completed utility scale offshore wind farm in federal waters and will soon deliver enough clean Renewable energy to power nearly 70,000 homes. Also, we continue to make good progress on our Revolution Wind project. Speaker 200:11:22As on July 17th, we received the environmental impact statement from BOEM, Setting the process for our record of decision and construction and operations plan approvals over the next few months. In May, we announced the seal of our uncommitted lease area to for 625,000,000 In an all cash transaction, last week we received federal approval on the lease transaction clearing the way toward a closing. We are now working on finalizing the transaction for the sale of our interest in the 3 development projects. We have substantially completed the due diligence phase and commercial terms on this transaction. We are Now truly near the goal line of wrapping up this deal. Speaker 200:12:13We are now working through the various agreements needed to complete this transaction Expect to make an announcement soon. Moving to Slide 8. As you can see here, The expected spending and in service dates have not changed for the 3 offshore wind projects. But what has changed Is that our procurement costs for the 3 projects are now at 93% as we are getting close to commencing construction activities On Revolution Wind, John will discuss the path forward toward our sale of these projects As well as some visibility on the impairment charge on the offshore wind investments. In closing, as we continue our focus Enabling a clean energy future, our nearly 10,000 employees and I have one goal in mind, to serve our customers well. Speaker 200:13:09That means making sure we understand our customers' needs, continuing to provide reliable and safe service and making the necessary investments To deliver energy and clean water today, tomorrow and for the years to come. We've made a commitment to make the appropriate investments To enable the transition into clean energy future, I couldn't be prouder of the effort that the Eversource team performs every day, and I look forward to the future with great excitement. Thank you again for your time, and I will now turn the call over to John Marrero. Speaker 300:13:45Thank you, Joe, and good morning, everyone. Today, I will review our results for the Q2 of 2023, Including our offshore wind impairment charge and I'll also discuss our recent offshore lease sale transaction, give you a status update And review our 2023 financing activity. So let me start with Slide 9. Our GAAP earnings We're at $0.04 per share in the Q2 of 2023 compared with GAAP earnings of $0.84 in the second Quarter of 2022. As we announced in May, based on our completion of the offshore wind strategic review And the status of the pendant project sale process, the results for the Q2 include an after tax impairment charge of $0.95 per share related to Eversource Energy's total Offshore Wind Investment. Speaker 300:14:46I will review details of this impairment in a few minutes. Results for both years include transaction and transition costs related to the acquisition of Eversource Gas Company of Massachusetts and other charges that totaled $6,200,000 in the Q2 of 2023 Compared with $5,500,000 in the Q2 of 2022. Absent these charges And the offshore wind impairment, our recurring earnings were $1 per share in the Q2 of this year Compared with $0.86 in the Q2 of last year. Looking at some additional details on the 2nd quarter recurring Earnings by segment, starting with our electric transmission segment, which earned $0.46 per share in the Q2 of 2023 compared with earnings of $0.44 per share in the Q2 of 2022. Improved results were driven by our continued investment in Eversource's electric transmission system to maintain High reliability performance for customers. Speaker 300:16:04Our Q2 2023 electric Distribution earnings were $0.47 per share compared with $0.37 in the Q2 of last year. The improved results were primarily due to higher revenues mainly from base distribution rate increases at nSTAR Electric, An expected favorable regulatory decision in New Hampshire that provided the recovery of previously expensed costs And lower O and M as a result of lower storm restoration costs. These benefits were partially offset by higher interest expense, depreciation and property taxes. Our natural gas distribution segment earned $0.03 per share in the Q2 of 2023 compared with earnings of $0.02 in the Q2 of last year. The improved Q2 results were due primarily to higher revenues from capital tracking mechanisms Supporting our continued investments in Massachusetts natural gas infrastructure as well as lower non tracked O and M expense. Speaker 300:17:19These benefits were partially offset by higher depreciation, interest and property tax expense. Moving on to our water distribution segment that earned $0.03 per share in the Q2 of this year, Really at the same level that we earned in the Q2 of last year. Eversource parent and other companies earnings were $0.01 Per share in the Q2 of 2023 compared with flat earnings in the Q2 of 2022, excluding The offshore wind impairment charge and the transaction and transition charges as I previously discussed. Improved second quarter results primarily reflect the lower effective tax rate, the residual benefit of a disposition of Eversource's interest in a cleaner energy fund, Partially offset by higher interest expense. Now turning to Slide 10 to further expand on what Joe covered On the sale of our 50 percent interest in approximately 175 acres of undeveloped uncommitted lease area To AUSTED for $625,000,000 in an all cash deal. Speaker 300:18:29We have executed a letter of intent with AUSTED To use a portion of the proceeds from the lease area to provide tax equity to the South Fork project Through a new tax equity ownership interest that we are finalizing the terms of this new agreement as we speak. On July 27, we received approval from the Committee on Foreign Investment in the U. S. Or CFIUS That allows us to close on both the lease area as well as the tax equity investment in South Fork later this month or early September. As part of completing our offshore wind strategic review, Eversource evaluated its aggregate investment in the contracted projects, the uncommitted lease area And other related capitalized costs and determine that the carrying value of the offshore wind investment exceeded its carrying value. Speaker 300:19:35The current estimate of fair value has been based on the sale price of the uncommitted lease area, The expected sale price of Eversource's 50% interest in the 3 contracted projects based on the most recent deal pricing, Investment tax credit qualifications for potential adders and the expectation of a successful re pricing Of the Sunrise Wind OREC contract. As a result, Eversource recognized an after tax impairment charge of $331,000,000 or $0.95 per share in the second This charge will have no will not have any impact on our cash flows from operations. We have made good progress on advancing the sale of our existing 50% interest in the 3 contracted offshore wind projects. As Joe mentioned, the due diligence phase is now substantially complete and behind us and we are advancing the transaction documentation. This process is complex with multiple agreements that must be completed at the same time, such as a replacement joint venture agreement. Speaker 300:20:56We recognize this process has taken a bit longer than expected, but we are not going to rush Through this documentation phase, it's important for us to have all agreements in a good place. With that said, we continue to remain focused on completing the final phase of this process. And once again, as Joe mentioned, we expect to announce the transaction soon. As a reminder, our total offshore wind investment after accounting for the impairment charge is approximately $2,100,000,000 as of June 30 this year. Now turning to Slide 11. Speaker 300:21:38We are maintaining our full year guidance of $4.25 $4.43 per share with a somewhat different quarterly earnings profile from 2022 Due to a rate change, as I previously discussed in our Q1 call. As a reminder, the rate change The rate design change at NSTAR Electric became effective at the beginning of this year, which eliminated higher summertime demand charges. This change shifts $0.08 per share of after tax revenues out of the 3rd quarter And into the first and fourth quarter and roughly equaled $0.04 per share split. There is no impact on the rate design change on the Q2 or the full year results. In addition to reaffirming our long term EPS growth rate solidly in the upper half of the 5% to 7% range, We also reaffirm our $21,500,000,000 5 year regulated capital program That we shared during our February earnings call. Speaker 300:22:56Capital expenditures totaled has totaled about 1,980,000,000 in the first half of twenty twenty three. Moving to Slide 12, here we highlight several factors That we expect will contribute to an improvement in cash flows in 2023 as compared to 2022. We expect an improvement over last year's in the ratio of funds from operation relative to total debt levels. Items we are highlighting on this slide include absence of 2022 one time cash outflow items, Net proceeds from the sale of our offshore wind investment, both the projects and the lease area, That will be used to lower debt balances, monetization of South Fork Wind Investment Tax Credits, Higher storm cost recoveries and distribution rate increases and the remaining equity issuance that we have discussed. As you are all aware, Over the past several years, we have experienced several significant storm events having an adverse impact on our cash flows With a sizable deferred storm balance in Connecticut alone at approximately $900,000,000 at the end of June, Our dedicated employees and the external contractor resources we depend upon to restore service to our customers Safely and efficiently, which comprise the vast majority of the level of deferred costs, Do an incredible job working around the clock in these severe weather events, but that does come at a cost. Speaker 300:24:52In terms of the year to date financing activity, please turn to Slide 13. As you can see here, in early May, we issued $1,800,000,000 of parent debt in 3 tranches at coupon rates ranging from 4.75 Percent to 5.45 percent and we retired $450,000,000 of parent company debt. Our expectation is that debt issuances will be much, much lower in the second half of twenty twenty three. We have issued no additional equity under our ATM program through July of this year. We remain committed to completing the remaining $1,000,000,000 in our ATM program. Speaker 300:25:41In addition, we anticipate raising Additional equity through our dividend reinvestment and employee incentive programs using treasury shares And through July, we have issued 647,000 shares. Thank you very much for joining us this morning And I look forward to seeing many of you soon. I will now turn the call over to Bob for Q and Speaker 100:26:08A. Thanks, John. I'll now turn the call back to Emily to begin Q and A. Operator00:26:15Thank Our first question comes from the line of Shahriar Pourreza with Guggenheim Partners. Shah, please go ahead. Your line is now open. Speaker 400:26:42Good morning, guys. Speaker 200:26:44Good morning, Sean. Speaker 400:26:46Can you hear me? Speaker 200:26:47Yes, we can Speaker 500:26:48hear you. Good morning. Speaker 600:26:49Just a couple of questions here. Perfect. Joe, just given the uncertainty that we're seeing nationally around just the offshore wind with A lot of project cancellations and renegotiations. How I guess, how confident are you that you can get this transaction across the finish line at a reasonable Twice. And what does this sort of mean for the growth rate and the remaining portion of the ATM as it stands? Speaker 600:27:13So do you see kind of any situation Post this deal where we could see incremental financing or the impact of how you measure the 5% to 7% EPS growth rate. Speaker 200:27:24Yes. Well, thank you, Sharon. I want to thank everybody for their patience around this complex Offshore wind seal. And it's been very, very complex. It involves Multiple agreements that all have to be aligned, and we want to be sure that we get the most money for our shareholders out of that exit. Speaker 200:27:46And we remain focused on completing this transaction to the point we're not going to let John Marrero take any summer vacation until he has it all taken care of. But back on point here, this region is so dependent on natural gas for electric generation. And that shift has to come. It has to come in some form of alternative generation and that's where wind Given the energy factors in this region, we can you got a wind availability factor out there of Well, 49% to 50% in the winter months, it's even greater when we peak. So we feel very strongly that wind is going to play a major role as we Transition to this clean energy environment. Speaker 200:28:32It performs especially well for us and for our customers. So I don't see Anyone taking their foot off the gas, the policy makers are very, very excited about wind. So I don't see that winning. And I really feel the appetite for wind assets, although there's been a few that have Decided not to go forward. There are as you know, we're out there very actively building. Speaker 700:29:00I Speaker 200:29:00was excited to get a lot of reports out of The foundation is being installed for the new substation and we are we will be the 1st offshore wind company in service In the fall, which is very, very exciting to me. So there are many parties that remain committed to offshore wind. Our offshore wind leases Our very, very priced assets, they sit in an area that has all the fundamentals Sorry to deliver great win speeds For any future bias, so that's why we feel good that it will continue to do well here. So All in all, it's going to take place. It didn't take place, obviously, at the pace that all of us would have liked it to take place. Speaker 200:29:54But I just want to promise you that we are here at the 1 yard line and that we are getting it over the goal. I think Some of the announcements that we made today should give you greater clarity as to how much we really know about this transaction and that This really is the final stage. We are really focused on redeploying the proceeds for a debt pay down and we are reaffirming our 1B equity issuance that we provided to you on the year end 2022 earnings call. So for that reason, I'm very confident that we'll complete the deal Soon. And thank you again for your patience, Shah. Speaker 600:30:32No, George, I guess, Are you comfortable with the current financing that's out there and the growth rate post this transaction? I mean, obviously, you're still Dotting your i's across your t's, but I think that's just Speaker 200:30:45Yes. We are. We are we are fully confident in that. Okay. Yeah. Speaker 200:30:52We are fully confident in that, and there's no change. Speaker 600:30:58Okay. Perfect. And just lastly, obviously, you know, you've highlighted this deal is taking a lot longer to get over the finish line, and there's, Obviously, a lot of investor angst over the contingencies and downside exposure. I guess, can you just maybe elaborate what remains On the negotiation side, how much of this kind of falls on Orsted, which is kind of out of your control? And do you see the is being reasonable at this point in the discussion as we're thinking about upside and downside? Speaker 600:31:28Thanks guys. Speaker 300:31:31John? Yes, sure. This is John. So yes, I mean, there are, as Joe mentioned and I mentioned in my formal remarks, there are multitude of agreements That needs to be executed in conjunction with our purchase and sale agreement, some of which we do not We will not be a party to. So those but we will help facilitate those working with the buyer to make sure that they Get to a good place with Orsted. Speaker 300:32:00As far as the contingencies, what's on the table right now and we're not here Disclosed those components because we have an execute we do not have an executed agreement. But I think we feel comfortable with that we can manage those well We're the Barstead and there's both pluses and minuses, downside and upside and we feel comfortable What will ultimately be agreed to? Speaker 600:32:32Okay, perfect. I'll jump back in the queue. That was all. Thanks guys. Appreciate it. Speaker 200:32:36Thank you. Operator00:32:40Our next question comes from Steve Fleishman with Wolfe Research. Steve, please go ahead. Your line is open. Speaker 800:32:49Hi. Good morning. Thanks for the update. Speaker 200:32:52Good morning, Steve. Speaker 800:32:55So just I think you mentioned that the impairment that you took on the offshore wind assumes you get the New York restructuring As well as the ITC adders. Is there any way to get a sense of what the investment level would be if you don't get those? Speaker 300:33:15Yes. So that is correct. We have included both of those Components in our impairment analysis. And obviously, in order for us to be in a position to do that, there needs to be a certain level of Conviction and probability and on both of those we feel very good about. I would say on average, I mean folks can certainly calculate it, but it's probably 400 a piece, 400,000,000. Speaker 800:33:51Okay. Understood. That's helpful color also on the probability part. And then my other question, John, just on the FFO to debt slide, That's very helpful in terms of the drivers. Is there any way to get a better sense of start and endpoints there or kind of the scale of any of those Do you drive up buckets there? Speaker 300:34:19Yes. And I think some of those items we have already shared and they might even be disclosed In our 10 Q, but I would size kind of the first category, these one timers that we experienced in 2020 2 that we will not materialize in 2023, I would say at least a quarter of $1,000,000,000 So $250,000,000 goes away. The 3 categories of those were we were as Part of the 2021 Connecticut CL and P settlement agreement, we still had half a year of refunds in 2022. That's been that's ceased. So that's behind us. Speaker 300:35:02So that was about, 70 some odd 1000000, 78,000,000 We made early on in 2022 some capital contributions, which we don't expect to make at least for the foreseeable future. And then we had another property tax settlement in Massachusetts to the tune of about another $70,000,000 that will not materialize this year. So that's that first category. And I think all the other ones when you look at rate adjustments, cost recovery Of previously deferred costs, those are starting to kick in. So in Massachusetts, as part of the rate case, we have close to $400,000,000 Rolling into rates, we had a piece of it that took effect earlier this year and we have another chunk that will take effect January 1, 2024. Speaker 300:35:52So I think if you factor those items then and clearly the biggest immediate Improvement in our cash flows is going to be the closing of these two transactions, the offshore wind transaction. So those are all the items and obviously as we've said, we still have $1,000,000,000 left under our ATM program to be executed. So all of those items gives me comfort that we will certainly move in the right direction from an FFO to debt. Speaker 800:36:27Understood. I'll let others take from here. Thank you. Speaker 200:36:31Thank Operator00:36:33you. Our next question comes from Durgesh Chopra with Evercore ISI. Speaker 900:36:44Hey, good morning, team. Thanks for giving me time. Hey, John, just really quickly, you mentioned hey, good morning, guys. You mentioned as part of the impairment charge, You assumed repricing on the Sunrise Wind. Can you just walk us through what the steps are or the next sort of milestones are as you kind of I filed for that repricing. Speaker 900:37:09And then what does that mean? Is that $400,000,000 related to That repricing, if that's what you quantified it as? Speaker 300:37:19Yes. So first, let me say that the process is underway. There is a schedule out there that NYSERDA has posted, which Could render a decision as soon as October November. So we expect something to be known Certainly by the end of this year. So dependent on what the approval is, we think it could be in the $4,000,000 to 450,000,000 Dollar range. Speaker 300:37:48So I think discovery has taken place. There's been some requests. So we're going through that phase. ArcelorMittal is going through that phase right now. And so is the other bit as we're all in the same procedural schedule. Speaker 900:38:06Got it. Thanks. And then just switching gears, you mentioned roughly like $900,000,000 in the deferred storm cost balance. And I don't think there is a filing coming up in Connecticut. Maybe can you just talk to that and what is the path to recovery and timeline of those costs? Speaker 300:38:25Well, the normal process in Connecticut is, you will commence recovery of storm costs As part of a general rate proceeding, and what we've done in the past is we filed for a prudency. So It's uncertain. Right now, we're still compiling all of the necessary data that's needed for that process to take place. But Suffice it to say that you will the recovery of those costs will happen when there's a general rate proceeding. And As we've said, that will the earliest that that will happen will be end of 2025. Speaker 900:39:07Got it. So it's part of your cash flow walk, there's nothing there from like 22% to 23% and then in terms of just improvement From recovery of those costs, that's more longer term dated? Speaker 300:39:20That balance is more longer term dated. We do have some cost recovery in base rates embedded in base rates for CL and P, but it's not significant To recover that anytime Speaker 900:39:38soon. Thanks so much. Speaker 300:39:40Thank you, Tagesh. Operator00:39:44The next question comes from David O'Cara with Morgan Stanley. David, please go ahead. Your line is open. Speaker 1000:39:52Hey, good morning. Thanks so much for taking my questions. Speaker 300:39:55Good morning. Good morning, David. Speaker 1000:39:57I was wondering, are you still expecting $2,100,000,000 to $2,400,000,000 in CapEx In that 2024 to 2026 period, that I think you disclosed previously and our returns still at that same level in the 11% to 13% ROE range. Speaker 300:40:15Are we referring David, is this offshore wind? Speaker 1000:40:20Yes, yes, sorry. Okay. Oscar win 2024 to 2026 CapEx plans. Any changes to the longer term CapEx? Speaker 300:40:30No, no, no. And that's no, it's reflected on that slide that we presented. So there's been no change in the overall Capital forecast needs both for this year because we did revise that on last quarter call. But longer term, no. There's been no capital changes to that. Speaker 1000:40:53Okay. Got it. Thanks. And then the impairment on the offshore wind assets was slightly larger than the last estimate. I was just wondering If you could elaborate on what might have changed since the last estimate when you announced the recent transaction? Speaker 300:41:11Sure, David. So in May, we were the buyer hadn't completed its due diligence process. We hadn't even filed for the request The Sunrise in New York, so a lot of things have come together since we made that announcement. And all of those Puts and takes have been factored into the impairment charge that we just recognized. So I would say A lot more is known and measurable today certainly than it was back in May. Speaker 300:41:40And that does reflect, as we've said in my phone as I've said in my phone remarks, The completion of due diligence and kind of the current deal pricing. Speaker 1000:41:55Okay. Got it. So a couple of moving pieces there. And it sounds like so in the original Estimate of the write off that didn't include a repricing of Sunrise or the potential value of the tax credit adders? Speaker 300:42:13It didn't include the New York repricing, but we've always felt comfortable On the tax component? So we can include the percent adder. Speaker 1000:42:29Got it. Understood. Thanks very much. Speaker 300:42:32Thank you, David. Operator00:42:36The next question comes from Andrew Weisel with Scotiabank. Andrew, please go ahead. Your line is open. Speaker 400:42:45Hey, good morning everybody. 1st, I just want to clarify, there's some Hi. I want to clarify. There's some confusion about the CLMP rate case payout. Does SB 7 allow regulators or interveners to call you in For October 25 or is it the settlement supersede the new state law? Speaker 300:43:05Our position is that our 2021 settlement agreement provides the ability, qualifies for that 4 year rate review, and that 4 year rate review will expire in the fall of 2025. Speaker 400:43:23Okay, great. Thank you. Next, I want to clarify The timing so excuse me? Okay, sorry. I want to clarify the timing. Speaker 400:43:35I think you said you expect can you hear me? Yes. We can hear you. Hello? Okay. Speaker 400:43:43Yes. Sorry about that. Let me go ahead to that. Anyway, you expect On Sunrise for the end of the year October, November and yet both Joe and John you guys both use the word soon from a sale price announcement. To be as clear as we can be, does soon mean before the repricing process is complete? Speaker 400:44:01Or will you and the potential buyer wait Until the future of Sunrise is known, either by waiting to make an announcement or adding a contingency to the contract? Speaker 300:44:10No, we will not wait for the determination from the State of New York on that. We will announce once these documents, as we've mentioned, are ready to go. Speaker 400:44:23Very good. Thank you. And sorry for the technical issue. Speaker 300:44:27No worries. Thank you. Operator00:44:32Our next question comes from Greg Orrill with UBS. Greg, please go ahead. Your line is open. Speaker 800:44:40Yes. Thank you. Hey. Regarding the $1,000,000,000 related to the ATM Equity, what's the Intent there for how long that would last you to fund the plan? And then is there any update on the Aquarian rate case Appeal. Speaker 800:45:06Thanks. Speaker 300:45:08Let me take the latter one. So the Aquarion rate case appeal continues to move forward. There's, I think, briefs to do later this month, 17th August, I believe, and then reply briefs. And we hope that by this, there is a hearing date scheduled for December 14th where the record will be closed and I believe it's scheduled for Oral arguments at that point in time. So shortly thereafter, the judge could render a decision. Speaker 300:45:38So that's where we stand on that. As far as the $1,000,000,000 equity, remaining equity under the ATM program, Certainly, we've said it over several years. We haven't issued any equity this year just Based on valuation. So, the ATM provides us with the ability to take advantage And be opportunistic. So there's we'll continue to monitor things accordingly and issue The equity as we feel comfortable. Speaker 900:46:20Thanks. Operator00:46:27Our next question comes from Jeremy Tonet with JPMorgan. Jeremy, please go ahead. Speaker 1100:46:35Hi, good morning. This is actually Rich Sunderland on for Jeremy. Can you hear me? Speaker 200:46:40Yes, we can, Rich. Speaker 1100:46:43All right. Great. Thank you. Just a couple of housekeeping items upfront. The $400,000,000 to 4 $1,000,000 you're referencing for New York. Speaker 1100:46:50Is that a pretax or after tax figure? Speaker 400:46:55Pretax. Speaker 1100:46:58Got it. Thank you. And then on the quarter itself, could you quantify the New Hampshire retroactive piece and the parent tax item as well? Speaker 300:47:10The parent tax item, I would tell you that it's probably close to About a 100 basis points different quarter over quarter in the effective tax rate. So last year's effective tax rate was like 24 and change and We're running around 22 Speaker 700:47:29and change. Speaker 1100:47:32Got it. And that New Hampshire retroactive piece, just how much was that and is that baked into guidance? Speaker 300:47:39It was baked into the guidance. We were banking on that. We were tracking the proceeding very, very closely Last year and we felt very good and comfortable about baking that in. I would say it's in, if I remember correctly in the $15,000,000 to $20,000,000 range. Speaker 100:48:02Got it. Very helpful. Speaker 1100:48:03And then just one higher level question. There's been a lot of attention on DUIs draft decision came out recently. Any thoughts on how this impacts your approach on the CLMP front for 2025? Or any thoughts on repos there to your Query and appeal or just other thoughts on Connecticut overall in light of that draft decision? Speaker 200:48:25Yes. Well, no, that was a draft, as you know, on July 21. It's Not the final decision. Obviously, it appears to track the Aquarion decision, discouraging investment in the state of Connecticut. We're obviously concerned about that decision, and we're hoping that between now and the Final decision that there are some changes in that. Speaker 200:48:49As you know, we will have our day in court. And if this remains as is, I assume that You know, UI will be in court as well to talk about that. 2025 is a long way away in terms of What we expect will happen in 2025. So I don't want to speculate on that. We will Continue to monitor, I continue to engage with key policy makers in the state. Speaker 200:49:17We have very good relations with the With the Attorney General with other parties, their agenda our agenda is very much aligned around clean energy and clean energy investments. There are a number I mean, one of the things That's interesting with the state of Connecticut is the number of clean energy technology companies in that state. I mean there are fuel cell Battery companies, all of them are looking to deploy their technologies. So any type Of a chill on investment in that state is not good for all of these startup companies, and it's obviously disappointing. But listen, we're not going We're not going to get this hard. Speaker 200:49:55We're not going to lose faith. We're going to continue to work that those relationships down there and try to get to a place that's fair For our customers and for our shareholders, that gets us to a much better cleaner environment with investments in that state. So Again, it's a very fluid situation. We'll have to see what the final decision looks like. But I just want everybody to know that I am personally involved working this along with the 9,500 other employees of this company, and we are going to work through these issues and I'm confident that we can get to a much better place. Operator00:50:47Our next question comes from Anthony Crowder with Mizuho. Anthony, please go ahead. Your line is open. Speaker 500:50:54Good morning, Anthony. Hey, good morning, Joe. Good morning, John. Thanks for taking my questions. I've been spending too much time up in Marlborough, Massachusetts, so I feel like a native now. Speaker 500:51:03Just I guess on Slide 12, if I could jump on Steve's question. Where did you end the quarter on an FFO to debt basis? And if you could just give us a range as you're very close to finishing the sale of offshore wind on what the improvement could possibly be. Is it 200 basis points or 2 to 2.50 or 1 to 150, if you're willing to quantify what the type of pickup would be FFO to debt. I think with Steve you gave more of the FFO, but not so much the metric. Speaker 300:51:33Yes. No, I hear you and I'm not We have not disclosed that and truth be told that I want to have those discussions with the agencies Before I share any of that detail with the broader audience, so we are now given where we are with The contracted project transaction, now we're at a point where I can share some of that information, some of the details with the rating agency. So And I have a meeting scheduled over the next several weeks to be able to do that. Speaker 500:52:14Great. And then just curious on the selling and I apologize I'm using just a different word. You may answered this with Shar's question. Once the sale is announced and once the sale closes, are there is there potential for further liabilities you have to be concerned with or the expectation is once there's a sale and the sale closes, there's no more impact to Eversource? Speaker 300:52:43Those are the what we plan to disseminate once we execute the agreement. But as I said, there will be some potential movements up or down. Speaker 500:52:56I'm sorry, potential movements after the close that could be up or down. Is that fair? Speaker 400:53:03Correct. Speaker 500:53:04Great. Thanks so much for taking my questions. I really appreciate it. Speaker 300:53:09Thank you. Operator00:53:13Our final question today comes from the line of Julien Dumoulin Smith with Bank of America. Julien, please go ahead. Your line is now open. Speaker 700:53:23Hey. Good afternoon, team or good morning rather, I should say. Thank you guys very much for the time. Just following up on a few housecleaning items here from the prior questions. Just clearly, when in your forecast do you assume Connecticut electric and natural gas rate cases, obviously you're holding to the upper end. Speaker 700:53:40Just wanted to clarify when you think you'll pursue those? Speaker 300:53:45On the electric, as we continue to state, our settlement agreement allows us to Meet the 4 year review period and that review period will expire in the fall of 2025. So we do not expect to file a CLMP case prior to that date. And if you look at The length of time it takes in a general rate proceeding, you're looking at a year. So with that timeframe, you're probably looking at The earliest date that rates will be changed would be early 2027. And then for Yankee Gas, Julian, we have no plans right now to file a rate proceeding. Speaker 300:54:33So we'll continue to monitor that as we always do, but we don't have any current plans to file. Speaker 700:54:43Got it. And no changes to your CapEx forecast for now, right, in Connecticut? Speaker 300:54:49That is correct. Speaker 700:54:55Got it. Excellent. And then just clarifying earlier the FFO to debt, I know lots of questions pluses and minuses, but can you quantify the big building blocks as you think about through the forecast period, Especially through 25 here, I mean, I think I heard ITC earlier. Can you just clarify? I know that you got some legacy items that we talked about earlier, and thank you again, John. Speaker 700:55:14But on 22, can you talk about the big puts and takes here that improve the metrics prospectively Speaker 100:55:21Through the forecast period. Speaker 300:55:24Through the forecast period, through 2027? Speaker 700:55:32Yes. I'm thinking about not just like 23 to 24, but really kind of Speaker 100:55:36getting that sustainable structural level, Right. As you think about the things of Lindblad? Speaker 300:55:41Yes. Yes. I would say, offshore wind will be the kick stop To that enhancement, once we get those and offload some debt, I think if you look at the longer Term rate mechanisms that we have in place certainly in Massachusetts, that will drive enhanced operating cash flows And the recovery of strong costs, although for CLMP, it will be towards the latter part of the forecast period. But I think all of those items when you look at the cash flows in Massachusetts as I mentioned, We are putting into rates about $400,000,000 of deferred storm costs. And as part of the rate case, The amount included in rate base in base rates was significantly increased. Speaker 300:56:34So those are all of the items that will continue to have Enhance cash flows and then completing our $1,000,000,000 equity program Over the coming years, we'll certainly enhance that credit metric. Speaker 700:56:54And then just to clarify, your 24 metrics here, do they benefit in FFO? Speaker 400:57:01Go for it. Speaker 300:57:02Yes. No, absolutely. I mean, we with everything else being equal, yes, we see 2023, as I I mentioned in my formal remarks, moving in the right direction from where we landed in 2022, and I see that trend Speaker 700:57:24Right. And 24 includes the tax equity in your FFO? Speaker 400:57:29Yes. Speaker 1100:57:34Got it. Okay. Excellent. Speaker 700:57:35Thank you. Really appreciate all the details here. Appreciate the cleanup. But best of luck, guys. Cheers. Speaker 400:57:41Thank you. Speaker 700:57:44Thank you. Those are all Operator00:57:45the questions we have time for today. So I hand the call back to Robert Becker for any closing remarks. Speaker 100:57:51Thanks, Emily. That concludes our call. Thank you for joining us today. If you have any follow-up questions, please reach out to Investor Relations. Operator00:58:01Thank you everyone for joining us today. This concludes our call and you may now disconnect your lines.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallEversource Energy Q2 202300:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Eversource Energy Earnings HeadlinesShould You Buy 2025's 3 New Dividend Aristocrats?April 20 at 11:45 AM | 247wallst.comEversource Energy (ES): The Low Profile Dividend Champion to BuyApril 18 at 6:36 PM | msn.comCrypto’s crashing…but we’re still profitingMost traders are panicking right now. Bitcoin’s dropping. Altcoins are bleeding. The stock market’s a mess. The news is screaming fear. But while most traders watch their portfolios tank…April 21, 2025 | Crypto Swap Profits (Ad)Eversource Energy (ES): Among the Best Utility Stocks to Buy According to AnalystsApril 18 at 12:23 AM | insidermonkey.comEversource Energy (ES): Among the Best Utility Stocks to Buy According to AnalystsApril 18 at 12:10 AM | msn.comEversource Energy (ES) Receives a Hold from Bank of America SecuritiesApril 17, 2025 | markets.businessinsider.comSee More Eversource Energy Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Eversource Energy? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Eversource Energy and other key companies, straight to your email. Email Address About Eversource EnergyEversource Energy (NYSE:ES), a public utility holding company, engages in the energy delivery business. The company operates through Electric Distribution, Electric Transmission, Natural Gas Distribution, and Water Distribution segments. It is involved in the transmission and distribution of electricity; solar power facilities; and distribution of natural gas. The company operates regulated water utilities that provide water services to approximately 241,000 customers. It serves residential, commercial, industrial, municipal and fire protection, and other customers in Connecticut, Massachusetts, and New Hampshire. The company was formerly known as Northeast Utilities and changed its name to Eversource Energy in April 2015. 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There are 12 speakers on the call. Operator00:00:00Hello, everyone, and welcome to Eversource Energy's Second Quarter 2023 Earnings Call. My name is Emily, and I'll be coordinating your call today. After the presentation, there will be the opportunity for any questions, which you can ask by pressing star followed by the number one on your telephone keypad. I'll now turn the call over to our host, Investor Relations Director, Robert Becker. Please go ahead, Robert. Speaker 100:00:22Good morning, and thank you for joining us. I'm Bob Becker, Eversource Energy's Director for Investor Relations. During this call, we'll be referencing slides we posted yesterday on our website. And as you can see on Slide 1, some of the statements made during this investor call may be forward looking. These statements are based on management's current expectations And are subject to risk and uncertainty, which may cause the actual results to differ materially from forecasts and projections. Speaker 100:00:50We undertake no obligation to update or revise any of these statements. Additional information about the various factors that may cause actual results to differ And our explanation of non GAAP measures and how they reconcile to GAAP results is contained within our news release, the slides we posted last night And in our most recent 10 ks and 10 Q. Speaking today will be Joe Nolan, our Chairman, President and Chief Executive Officer And John Barrera, our Executive Vice President and CFO. Also joining us today is Jay Booth, our Vice President and Controller. Now, I'll turn the call over to Joe. Speaker 200:01:29Thank you, Bob, and thank you, everyone, for joining us on this call this morning. I hope that you're all having a good summer and can take some time off after earnings season. Today, we'd like to update you on our commitment to deliver value to achieve important objectives on both ESG and diversity and our progress to close out the offshore wind seal process. Starting on Slide 3. Here at Eversource, we are working tirelessly to deliver energy and clean water safely and reliably To our 4,400,000 customers, our steadfast focus on serving our customers well continues to deliver superior results In all aspects of our businesses in Connecticut, Massachusetts and New Hampshire. Speaker 200:02:19As you can see from the bottom of this slide, investments we have made over the past decade are greatly benefiting customers. The average months between interruption has increased significantly from 12 months in 2011 To nearly 20 months at the end of 2022, in over 2 years through the first half of twenty twenty three. As a result, this high performance level puts Eversource's reliability in the top decile compared to industry peers. In addition, when an outage occurs, the average duration experienced by customers has improved dramatically. Our relatively short average duration of outages also puts Eversource in the top decile compared to industry peers. Speaker 200:03:08This top decile level of reliability is the result of years of investment in the states in which we operate And the dedication and the high work of our skilled employees. Turning to Slide 4 On the energy supply side of our customs bill, we're pleased that our customers have experienced some improvement In supply pricing in New England, challenges due to natural gas supply constraints because of the war in Ukraine and the global market dynamics led to last winter's historically high energy prices here in New England. This summer, natural gas prices have moderated nicely, And we're seeing much lower electricity prices as a result. In Connecticut and Massachusetts, new supply rates went into effect on July 1st And will remain in place through the end of the year. Supply rates for residential customers in Connecticut and Massachusetts Decreased approximately 40% per kilowatt hour from January of this year to July 1st this year. Speaker 200:04:18In New Hampshire, residential customers will see a decline of approximately 40% per kilowatt hour in the supply rate effective August 1st, as a reminder, we purchase power on behalf of our customers in accordance with guidelines set by our state regulators And we do not earn any profit from this portion of our customers bill. We are very pleased that our customers have seen some cost relief this summer As it helps to offset customers usage that is much higher in the summer than in the winter. And while 2023 prices have come down in recent months, we expect another seasonal increase in supply prices for this coming winter. Therefore, we remain focused on our industry leading energy efficiency programs and we're continuing to engage with policymakers to discuss long term solutions. To that end, in June, senior leaders actively participated In the FERC sponsored forum in Portland, Maine on gas and electric reliability matters, the topics discussed Include retaining existing natural gas infrastructure and new electric transmission infrastructure needed to connect Onshore and offshore generation and other renewable energy resources. Speaker 200:05:41This was a very well attended meeting That included all 4 FERC commissioners and the state energy policy leaders from across New England. We look forward to continuing the engagement with FERC And other key stakeholders to continue to advance this energy resource challenge for New England. Turning to Slide 5. In June, we posted on Eversource's website our 2022 sustainability report Along with our standalone diversity, equity and inclusion report, these publications highlight our commitment to leading environmental, Social Equity and Governance Practices. We continue to make strong progress towards our 2,030 carbon neutrality goal With a quarter of the emissions already cut from our baseline year of 2018. Speaker 200:06:34To continue progressing toward this target, We're focused on 5 key sources of emissions line loss, natural gas leaks, Energy use across our facilities, fuel use by our fleet and releases of sulfur hexafluoride That is used as an insulator in electrical equipment. The many initiatives we have implemented to drive emissions down are showing results. In fact, from 2021 to 2022, we've seen a 15% overall emissions reduction. These efforts have ranged from enabling more capacity for renewables on the grid to replacing aging leak prone natural gas pipes to investing in hybrid vehicles and procuring renewable energy for our buildings. We're also pursuing innovative Solutions such as a pilot project featuring a first of its kind sulfur hexafluoride free breaker used in our electric system. Speaker 200:07:36And we continue to explore solutions that will enable a decarbonized heating sector. These include our geothermal pilot And evaluating the potential to replace natural gas with low or 0 carbon molecules. As many of you know, we're also expanding our emission reduction efforts through the commitment to adopt an ambitious science based target. Committing to a science based target is a best practice that places us among a handful of industry leaders in the U. S. Speaker 200:08:10And we plan to have our targets submitted by 2024. Turning now to our clean energy effort. In 2022, we invested nearly $800,000,000 in clean energy, including offshore wind, battery storage, Electric vehicle charging and first of a kind utility scale network geothermal energy pilot in Massachusetts. Although we announced our plans to divest of offshore wind assets, Eversource remains committed to supporting the development of important regional clean energy solutions. Slide 6 reflects the many clean energy initiatives underway in Massachusetts To enable the clean energy transition. Speaker 200:08:56As you can see on this slide, Massachusetts has a constructive Regulatory framework that will facilitate over $2,000,000,000 of clean energy investments over the next 5 years. This includes approximately $200,000,000 of FERC approved transmission projects that would enable offshore wind generation to interconnect to our grid. We could potentially see an additional $350,000,000 of transmission investment when Massachusetts issues its next RFP for additional offshore wind generation. And certainly, we can expect this transmission interconnection need to grow as additional offshore generation is procured for the region. We continue to emphasize the need for system investments to support increased electrification and distributed generation To help ease the current reliance on natural gas generation in the region. Speaker 200:09:57Here at Eversource, While we're focused on enabling clean energy transition, we're also focused on enabling an equitable transition. This means protecting communities, industries and people that are at risk of being disadvantaged in the clean energy transition. Now moving to offshore wind. As you see here on Slide 7, we continue to make progress in the development of our offshore wind projects Through our joint venture with we recently achieved some major milestones with the South Fork Wind Project. Construction Of the project's U. Speaker 200:10:37S. Built onshore substation and transmission cable is complete, and the installation of the offshore substation The subsea transmission cable were recently completed. Additionally, wind turbine pre assembly is underway In New London, Connecticut, an installation of offshore towers will begin soon. South Park Wind is on track to become the nation's 1st completed utility scale offshore wind farm in federal waters and will soon deliver enough clean Renewable energy to power nearly 70,000 homes. Also, we continue to make good progress on our Revolution Wind project. Speaker 200:11:22As on July 17th, we received the environmental impact statement from BOEM, Setting the process for our record of decision and construction and operations plan approvals over the next few months. In May, we announced the seal of our uncommitted lease area to for 625,000,000 In an all cash transaction, last week we received federal approval on the lease transaction clearing the way toward a closing. We are now working on finalizing the transaction for the sale of our interest in the 3 development projects. We have substantially completed the due diligence phase and commercial terms on this transaction. We are Now truly near the goal line of wrapping up this deal. Speaker 200:12:13We are now working through the various agreements needed to complete this transaction Expect to make an announcement soon. Moving to Slide 8. As you can see here, The expected spending and in service dates have not changed for the 3 offshore wind projects. But what has changed Is that our procurement costs for the 3 projects are now at 93% as we are getting close to commencing construction activities On Revolution Wind, John will discuss the path forward toward our sale of these projects As well as some visibility on the impairment charge on the offshore wind investments. In closing, as we continue our focus Enabling a clean energy future, our nearly 10,000 employees and I have one goal in mind, to serve our customers well. Speaker 200:13:09That means making sure we understand our customers' needs, continuing to provide reliable and safe service and making the necessary investments To deliver energy and clean water today, tomorrow and for the years to come. We've made a commitment to make the appropriate investments To enable the transition into clean energy future, I couldn't be prouder of the effort that the Eversource team performs every day, and I look forward to the future with great excitement. Thank you again for your time, and I will now turn the call over to John Marrero. Speaker 300:13:45Thank you, Joe, and good morning, everyone. Today, I will review our results for the Q2 of 2023, Including our offshore wind impairment charge and I'll also discuss our recent offshore lease sale transaction, give you a status update And review our 2023 financing activity. So let me start with Slide 9. Our GAAP earnings We're at $0.04 per share in the Q2 of 2023 compared with GAAP earnings of $0.84 in the second Quarter of 2022. As we announced in May, based on our completion of the offshore wind strategic review And the status of the pendant project sale process, the results for the Q2 include an after tax impairment charge of $0.95 per share related to Eversource Energy's total Offshore Wind Investment. Speaker 300:14:46I will review details of this impairment in a few minutes. Results for both years include transaction and transition costs related to the acquisition of Eversource Gas Company of Massachusetts and other charges that totaled $6,200,000 in the Q2 of 2023 Compared with $5,500,000 in the Q2 of 2022. Absent these charges And the offshore wind impairment, our recurring earnings were $1 per share in the Q2 of this year Compared with $0.86 in the Q2 of last year. Looking at some additional details on the 2nd quarter recurring Earnings by segment, starting with our electric transmission segment, which earned $0.46 per share in the Q2 of 2023 compared with earnings of $0.44 per share in the Q2 of 2022. Improved results were driven by our continued investment in Eversource's electric transmission system to maintain High reliability performance for customers. Speaker 300:16:04Our Q2 2023 electric Distribution earnings were $0.47 per share compared with $0.37 in the Q2 of last year. The improved results were primarily due to higher revenues mainly from base distribution rate increases at nSTAR Electric, An expected favorable regulatory decision in New Hampshire that provided the recovery of previously expensed costs And lower O and M as a result of lower storm restoration costs. These benefits were partially offset by higher interest expense, depreciation and property taxes. Our natural gas distribution segment earned $0.03 per share in the Q2 of 2023 compared with earnings of $0.02 in the Q2 of last year. The improved Q2 results were due primarily to higher revenues from capital tracking mechanisms Supporting our continued investments in Massachusetts natural gas infrastructure as well as lower non tracked O and M expense. Speaker 300:17:19These benefits were partially offset by higher depreciation, interest and property tax expense. Moving on to our water distribution segment that earned $0.03 per share in the Q2 of this year, Really at the same level that we earned in the Q2 of last year. Eversource parent and other companies earnings were $0.01 Per share in the Q2 of 2023 compared with flat earnings in the Q2 of 2022, excluding The offshore wind impairment charge and the transaction and transition charges as I previously discussed. Improved second quarter results primarily reflect the lower effective tax rate, the residual benefit of a disposition of Eversource's interest in a cleaner energy fund, Partially offset by higher interest expense. Now turning to Slide 10 to further expand on what Joe covered On the sale of our 50 percent interest in approximately 175 acres of undeveloped uncommitted lease area To AUSTED for $625,000,000 in an all cash deal. Speaker 300:18:29We have executed a letter of intent with AUSTED To use a portion of the proceeds from the lease area to provide tax equity to the South Fork project Through a new tax equity ownership interest that we are finalizing the terms of this new agreement as we speak. On July 27, we received approval from the Committee on Foreign Investment in the U. S. Or CFIUS That allows us to close on both the lease area as well as the tax equity investment in South Fork later this month or early September. As part of completing our offshore wind strategic review, Eversource evaluated its aggregate investment in the contracted projects, the uncommitted lease area And other related capitalized costs and determine that the carrying value of the offshore wind investment exceeded its carrying value. Speaker 300:19:35The current estimate of fair value has been based on the sale price of the uncommitted lease area, The expected sale price of Eversource's 50% interest in the 3 contracted projects based on the most recent deal pricing, Investment tax credit qualifications for potential adders and the expectation of a successful re pricing Of the Sunrise Wind OREC contract. As a result, Eversource recognized an after tax impairment charge of $331,000,000 or $0.95 per share in the second This charge will have no will not have any impact on our cash flows from operations. We have made good progress on advancing the sale of our existing 50% interest in the 3 contracted offshore wind projects. As Joe mentioned, the due diligence phase is now substantially complete and behind us and we are advancing the transaction documentation. This process is complex with multiple agreements that must be completed at the same time, such as a replacement joint venture agreement. Speaker 300:20:56We recognize this process has taken a bit longer than expected, but we are not going to rush Through this documentation phase, it's important for us to have all agreements in a good place. With that said, we continue to remain focused on completing the final phase of this process. And once again, as Joe mentioned, we expect to announce the transaction soon. As a reminder, our total offshore wind investment after accounting for the impairment charge is approximately $2,100,000,000 as of June 30 this year. Now turning to Slide 11. Speaker 300:21:38We are maintaining our full year guidance of $4.25 $4.43 per share with a somewhat different quarterly earnings profile from 2022 Due to a rate change, as I previously discussed in our Q1 call. As a reminder, the rate change The rate design change at NSTAR Electric became effective at the beginning of this year, which eliminated higher summertime demand charges. This change shifts $0.08 per share of after tax revenues out of the 3rd quarter And into the first and fourth quarter and roughly equaled $0.04 per share split. There is no impact on the rate design change on the Q2 or the full year results. In addition to reaffirming our long term EPS growth rate solidly in the upper half of the 5% to 7% range, We also reaffirm our $21,500,000,000 5 year regulated capital program That we shared during our February earnings call. Speaker 300:22:56Capital expenditures totaled has totaled about 1,980,000,000 in the first half of twenty twenty three. Moving to Slide 12, here we highlight several factors That we expect will contribute to an improvement in cash flows in 2023 as compared to 2022. We expect an improvement over last year's in the ratio of funds from operation relative to total debt levels. Items we are highlighting on this slide include absence of 2022 one time cash outflow items, Net proceeds from the sale of our offshore wind investment, both the projects and the lease area, That will be used to lower debt balances, monetization of South Fork Wind Investment Tax Credits, Higher storm cost recoveries and distribution rate increases and the remaining equity issuance that we have discussed. As you are all aware, Over the past several years, we have experienced several significant storm events having an adverse impact on our cash flows With a sizable deferred storm balance in Connecticut alone at approximately $900,000,000 at the end of June, Our dedicated employees and the external contractor resources we depend upon to restore service to our customers Safely and efficiently, which comprise the vast majority of the level of deferred costs, Do an incredible job working around the clock in these severe weather events, but that does come at a cost. Speaker 300:24:52In terms of the year to date financing activity, please turn to Slide 13. As you can see here, in early May, we issued $1,800,000,000 of parent debt in 3 tranches at coupon rates ranging from 4.75 Percent to 5.45 percent and we retired $450,000,000 of parent company debt. Our expectation is that debt issuances will be much, much lower in the second half of twenty twenty three. We have issued no additional equity under our ATM program through July of this year. We remain committed to completing the remaining $1,000,000,000 in our ATM program. Speaker 300:25:41In addition, we anticipate raising Additional equity through our dividend reinvestment and employee incentive programs using treasury shares And through July, we have issued 647,000 shares. Thank you very much for joining us this morning And I look forward to seeing many of you soon. I will now turn the call over to Bob for Q and Speaker 100:26:08A. Thanks, John. I'll now turn the call back to Emily to begin Q and A. Operator00:26:15Thank Our first question comes from the line of Shahriar Pourreza with Guggenheim Partners. Shah, please go ahead. Your line is now open. Speaker 400:26:42Good morning, guys. Speaker 200:26:44Good morning, Sean. Speaker 400:26:46Can you hear me? Speaker 200:26:47Yes, we can Speaker 500:26:48hear you. Good morning. Speaker 600:26:49Just a couple of questions here. Perfect. Joe, just given the uncertainty that we're seeing nationally around just the offshore wind with A lot of project cancellations and renegotiations. How I guess, how confident are you that you can get this transaction across the finish line at a reasonable Twice. And what does this sort of mean for the growth rate and the remaining portion of the ATM as it stands? Speaker 600:27:13So do you see kind of any situation Post this deal where we could see incremental financing or the impact of how you measure the 5% to 7% EPS growth rate. Speaker 200:27:24Yes. Well, thank you, Sharon. I want to thank everybody for their patience around this complex Offshore wind seal. And it's been very, very complex. It involves Multiple agreements that all have to be aligned, and we want to be sure that we get the most money for our shareholders out of that exit. Speaker 200:27:46And we remain focused on completing this transaction to the point we're not going to let John Marrero take any summer vacation until he has it all taken care of. But back on point here, this region is so dependent on natural gas for electric generation. And that shift has to come. It has to come in some form of alternative generation and that's where wind Given the energy factors in this region, we can you got a wind availability factor out there of Well, 49% to 50% in the winter months, it's even greater when we peak. So we feel very strongly that wind is going to play a major role as we Transition to this clean energy environment. Speaker 200:28:32It performs especially well for us and for our customers. So I don't see Anyone taking their foot off the gas, the policy makers are very, very excited about wind. So I don't see that winning. And I really feel the appetite for wind assets, although there's been a few that have Decided not to go forward. There are as you know, we're out there very actively building. Speaker 700:29:00I Speaker 200:29:00was excited to get a lot of reports out of The foundation is being installed for the new substation and we are we will be the 1st offshore wind company in service In the fall, which is very, very exciting to me. So there are many parties that remain committed to offshore wind. Our offshore wind leases Our very, very priced assets, they sit in an area that has all the fundamentals Sorry to deliver great win speeds For any future bias, so that's why we feel good that it will continue to do well here. So All in all, it's going to take place. It didn't take place, obviously, at the pace that all of us would have liked it to take place. Speaker 200:29:54But I just want to promise you that we are here at the 1 yard line and that we are getting it over the goal. I think Some of the announcements that we made today should give you greater clarity as to how much we really know about this transaction and that This really is the final stage. We are really focused on redeploying the proceeds for a debt pay down and we are reaffirming our 1B equity issuance that we provided to you on the year end 2022 earnings call. So for that reason, I'm very confident that we'll complete the deal Soon. And thank you again for your patience, Shah. Speaker 600:30:32No, George, I guess, Are you comfortable with the current financing that's out there and the growth rate post this transaction? I mean, obviously, you're still Dotting your i's across your t's, but I think that's just Speaker 200:30:45Yes. We are. We are we are fully confident in that. Okay. Yeah. Speaker 200:30:52We are fully confident in that, and there's no change. Speaker 600:30:58Okay. Perfect. And just lastly, obviously, you know, you've highlighted this deal is taking a lot longer to get over the finish line, and there's, Obviously, a lot of investor angst over the contingencies and downside exposure. I guess, can you just maybe elaborate what remains On the negotiation side, how much of this kind of falls on Orsted, which is kind of out of your control? And do you see the is being reasonable at this point in the discussion as we're thinking about upside and downside? Speaker 600:31:28Thanks guys. Speaker 300:31:31John? Yes, sure. This is John. So yes, I mean, there are, as Joe mentioned and I mentioned in my formal remarks, there are multitude of agreements That needs to be executed in conjunction with our purchase and sale agreement, some of which we do not We will not be a party to. So those but we will help facilitate those working with the buyer to make sure that they Get to a good place with Orsted. Speaker 300:32:00As far as the contingencies, what's on the table right now and we're not here Disclosed those components because we have an execute we do not have an executed agreement. But I think we feel comfortable with that we can manage those well We're the Barstead and there's both pluses and minuses, downside and upside and we feel comfortable What will ultimately be agreed to? Speaker 600:32:32Okay, perfect. I'll jump back in the queue. That was all. Thanks guys. Appreciate it. Speaker 200:32:36Thank you. Operator00:32:40Our next question comes from Steve Fleishman with Wolfe Research. Steve, please go ahead. Your line is open. Speaker 800:32:49Hi. Good morning. Thanks for the update. Speaker 200:32:52Good morning, Steve. Speaker 800:32:55So just I think you mentioned that the impairment that you took on the offshore wind assumes you get the New York restructuring As well as the ITC adders. Is there any way to get a sense of what the investment level would be if you don't get those? Speaker 300:33:15Yes. So that is correct. We have included both of those Components in our impairment analysis. And obviously, in order for us to be in a position to do that, there needs to be a certain level of Conviction and probability and on both of those we feel very good about. I would say on average, I mean folks can certainly calculate it, but it's probably 400 a piece, 400,000,000. Speaker 800:33:51Okay. Understood. That's helpful color also on the probability part. And then my other question, John, just on the FFO to debt slide, That's very helpful in terms of the drivers. Is there any way to get a better sense of start and endpoints there or kind of the scale of any of those Do you drive up buckets there? Speaker 300:34:19Yes. And I think some of those items we have already shared and they might even be disclosed In our 10 Q, but I would size kind of the first category, these one timers that we experienced in 2020 2 that we will not materialize in 2023, I would say at least a quarter of $1,000,000,000 So $250,000,000 goes away. The 3 categories of those were we were as Part of the 2021 Connecticut CL and P settlement agreement, we still had half a year of refunds in 2022. That's been that's ceased. So that's behind us. Speaker 300:35:02So that was about, 70 some odd 1000000, 78,000,000 We made early on in 2022 some capital contributions, which we don't expect to make at least for the foreseeable future. And then we had another property tax settlement in Massachusetts to the tune of about another $70,000,000 that will not materialize this year. So that's that first category. And I think all the other ones when you look at rate adjustments, cost recovery Of previously deferred costs, those are starting to kick in. So in Massachusetts, as part of the rate case, we have close to $400,000,000 Rolling into rates, we had a piece of it that took effect earlier this year and we have another chunk that will take effect January 1, 2024. Speaker 300:35:52So I think if you factor those items then and clearly the biggest immediate Improvement in our cash flows is going to be the closing of these two transactions, the offshore wind transaction. So those are all the items and obviously as we've said, we still have $1,000,000,000 left under our ATM program to be executed. So all of those items gives me comfort that we will certainly move in the right direction from an FFO to debt. Speaker 800:36:27Understood. I'll let others take from here. Thank you. Speaker 200:36:31Thank Operator00:36:33you. Our next question comes from Durgesh Chopra with Evercore ISI. Speaker 900:36:44Hey, good morning, team. Thanks for giving me time. Hey, John, just really quickly, you mentioned hey, good morning, guys. You mentioned as part of the impairment charge, You assumed repricing on the Sunrise Wind. Can you just walk us through what the steps are or the next sort of milestones are as you kind of I filed for that repricing. Speaker 900:37:09And then what does that mean? Is that $400,000,000 related to That repricing, if that's what you quantified it as? Speaker 300:37:19Yes. So first, let me say that the process is underway. There is a schedule out there that NYSERDA has posted, which Could render a decision as soon as October November. So we expect something to be known Certainly by the end of this year. So dependent on what the approval is, we think it could be in the $4,000,000 to 450,000,000 Dollar range. Speaker 300:37:48So I think discovery has taken place. There's been some requests. So we're going through that phase. ArcelorMittal is going through that phase right now. And so is the other bit as we're all in the same procedural schedule. Speaker 900:38:06Got it. Thanks. And then just switching gears, you mentioned roughly like $900,000,000 in the deferred storm cost balance. And I don't think there is a filing coming up in Connecticut. Maybe can you just talk to that and what is the path to recovery and timeline of those costs? Speaker 300:38:25Well, the normal process in Connecticut is, you will commence recovery of storm costs As part of a general rate proceeding, and what we've done in the past is we filed for a prudency. So It's uncertain. Right now, we're still compiling all of the necessary data that's needed for that process to take place. But Suffice it to say that you will the recovery of those costs will happen when there's a general rate proceeding. And As we've said, that will the earliest that that will happen will be end of 2025. Speaker 900:39:07Got it. So it's part of your cash flow walk, there's nothing there from like 22% to 23% and then in terms of just improvement From recovery of those costs, that's more longer term dated? Speaker 300:39:20That balance is more longer term dated. We do have some cost recovery in base rates embedded in base rates for CL and P, but it's not significant To recover that anytime Speaker 900:39:38soon. Thanks so much. Speaker 300:39:40Thank you, Tagesh. Operator00:39:44The next question comes from David O'Cara with Morgan Stanley. David, please go ahead. Your line is open. Speaker 1000:39:52Hey, good morning. Thanks so much for taking my questions. Speaker 300:39:55Good morning. Good morning, David. Speaker 1000:39:57I was wondering, are you still expecting $2,100,000,000 to $2,400,000,000 in CapEx In that 2024 to 2026 period, that I think you disclosed previously and our returns still at that same level in the 11% to 13% ROE range. Speaker 300:40:15Are we referring David, is this offshore wind? Speaker 1000:40:20Yes, yes, sorry. Okay. Oscar win 2024 to 2026 CapEx plans. Any changes to the longer term CapEx? Speaker 300:40:30No, no, no. And that's no, it's reflected on that slide that we presented. So there's been no change in the overall Capital forecast needs both for this year because we did revise that on last quarter call. But longer term, no. There's been no capital changes to that. Speaker 1000:40:53Okay. Got it. Thanks. And then the impairment on the offshore wind assets was slightly larger than the last estimate. I was just wondering If you could elaborate on what might have changed since the last estimate when you announced the recent transaction? Speaker 300:41:11Sure, David. So in May, we were the buyer hadn't completed its due diligence process. We hadn't even filed for the request The Sunrise in New York, so a lot of things have come together since we made that announcement. And all of those Puts and takes have been factored into the impairment charge that we just recognized. So I would say A lot more is known and measurable today certainly than it was back in May. Speaker 300:41:40And that does reflect, as we've said in my phone as I've said in my phone remarks, The completion of due diligence and kind of the current deal pricing. Speaker 1000:41:55Okay. Got it. So a couple of moving pieces there. And it sounds like so in the original Estimate of the write off that didn't include a repricing of Sunrise or the potential value of the tax credit adders? Speaker 300:42:13It didn't include the New York repricing, but we've always felt comfortable On the tax component? So we can include the percent adder. Speaker 1000:42:29Got it. Understood. Thanks very much. Speaker 300:42:32Thank you, David. Operator00:42:36The next question comes from Andrew Weisel with Scotiabank. Andrew, please go ahead. Your line is open. Speaker 400:42:45Hey, good morning everybody. 1st, I just want to clarify, there's some Hi. I want to clarify. There's some confusion about the CLMP rate case payout. Does SB 7 allow regulators or interveners to call you in For October 25 or is it the settlement supersede the new state law? Speaker 300:43:05Our position is that our 2021 settlement agreement provides the ability, qualifies for that 4 year rate review, and that 4 year rate review will expire in the fall of 2025. Speaker 400:43:23Okay, great. Thank you. Next, I want to clarify The timing so excuse me? Okay, sorry. I want to clarify the timing. Speaker 400:43:35I think you said you expect can you hear me? Yes. We can hear you. Hello? Okay. Speaker 400:43:43Yes. Sorry about that. Let me go ahead to that. Anyway, you expect On Sunrise for the end of the year October, November and yet both Joe and John you guys both use the word soon from a sale price announcement. To be as clear as we can be, does soon mean before the repricing process is complete? Speaker 400:44:01Or will you and the potential buyer wait Until the future of Sunrise is known, either by waiting to make an announcement or adding a contingency to the contract? Speaker 300:44:10No, we will not wait for the determination from the State of New York on that. We will announce once these documents, as we've mentioned, are ready to go. Speaker 400:44:23Very good. Thank you. And sorry for the technical issue. Speaker 300:44:27No worries. Thank you. Operator00:44:32Our next question comes from Greg Orrill with UBS. Greg, please go ahead. Your line is open. Speaker 800:44:40Yes. Thank you. Hey. Regarding the $1,000,000,000 related to the ATM Equity, what's the Intent there for how long that would last you to fund the plan? And then is there any update on the Aquarian rate case Appeal. Speaker 800:45:06Thanks. Speaker 300:45:08Let me take the latter one. So the Aquarion rate case appeal continues to move forward. There's, I think, briefs to do later this month, 17th August, I believe, and then reply briefs. And we hope that by this, there is a hearing date scheduled for December 14th where the record will be closed and I believe it's scheduled for Oral arguments at that point in time. So shortly thereafter, the judge could render a decision. Speaker 300:45:38So that's where we stand on that. As far as the $1,000,000,000 equity, remaining equity under the ATM program, Certainly, we've said it over several years. We haven't issued any equity this year just Based on valuation. So, the ATM provides us with the ability to take advantage And be opportunistic. So there's we'll continue to monitor things accordingly and issue The equity as we feel comfortable. Speaker 900:46:20Thanks. Operator00:46:27Our next question comes from Jeremy Tonet with JPMorgan. Jeremy, please go ahead. Speaker 1100:46:35Hi, good morning. This is actually Rich Sunderland on for Jeremy. Can you hear me? Speaker 200:46:40Yes, we can, Rich. Speaker 1100:46:43All right. Great. Thank you. Just a couple of housekeeping items upfront. The $400,000,000 to 4 $1,000,000 you're referencing for New York. Speaker 1100:46:50Is that a pretax or after tax figure? Speaker 400:46:55Pretax. Speaker 1100:46:58Got it. Thank you. And then on the quarter itself, could you quantify the New Hampshire retroactive piece and the parent tax item as well? Speaker 300:47:10The parent tax item, I would tell you that it's probably close to About a 100 basis points different quarter over quarter in the effective tax rate. So last year's effective tax rate was like 24 and change and We're running around 22 Speaker 700:47:29and change. Speaker 1100:47:32Got it. And that New Hampshire retroactive piece, just how much was that and is that baked into guidance? Speaker 300:47:39It was baked into the guidance. We were banking on that. We were tracking the proceeding very, very closely Last year and we felt very good and comfortable about baking that in. I would say it's in, if I remember correctly in the $15,000,000 to $20,000,000 range. Speaker 100:48:02Got it. Very helpful. Speaker 1100:48:03And then just one higher level question. There's been a lot of attention on DUIs draft decision came out recently. Any thoughts on how this impacts your approach on the CLMP front for 2025? Or any thoughts on repos there to your Query and appeal or just other thoughts on Connecticut overall in light of that draft decision? Speaker 200:48:25Yes. Well, no, that was a draft, as you know, on July 21. It's Not the final decision. Obviously, it appears to track the Aquarion decision, discouraging investment in the state of Connecticut. We're obviously concerned about that decision, and we're hoping that between now and the Final decision that there are some changes in that. Speaker 200:48:49As you know, we will have our day in court. And if this remains as is, I assume that You know, UI will be in court as well to talk about that. 2025 is a long way away in terms of What we expect will happen in 2025. So I don't want to speculate on that. We will Continue to monitor, I continue to engage with key policy makers in the state. Speaker 200:49:17We have very good relations with the With the Attorney General with other parties, their agenda our agenda is very much aligned around clean energy and clean energy investments. There are a number I mean, one of the things That's interesting with the state of Connecticut is the number of clean energy technology companies in that state. I mean there are fuel cell Battery companies, all of them are looking to deploy their technologies. So any type Of a chill on investment in that state is not good for all of these startup companies, and it's obviously disappointing. But listen, we're not going We're not going to get this hard. Speaker 200:49:55We're not going to lose faith. We're going to continue to work that those relationships down there and try to get to a place that's fair For our customers and for our shareholders, that gets us to a much better cleaner environment with investments in that state. So Again, it's a very fluid situation. We'll have to see what the final decision looks like. But I just want everybody to know that I am personally involved working this along with the 9,500 other employees of this company, and we are going to work through these issues and I'm confident that we can get to a much better place. Operator00:50:47Our next question comes from Anthony Crowder with Mizuho. Anthony, please go ahead. Your line is open. Speaker 500:50:54Good morning, Anthony. Hey, good morning, Joe. Good morning, John. Thanks for taking my questions. I've been spending too much time up in Marlborough, Massachusetts, so I feel like a native now. Speaker 500:51:03Just I guess on Slide 12, if I could jump on Steve's question. Where did you end the quarter on an FFO to debt basis? And if you could just give us a range as you're very close to finishing the sale of offshore wind on what the improvement could possibly be. Is it 200 basis points or 2 to 2.50 or 1 to 150, if you're willing to quantify what the type of pickup would be FFO to debt. I think with Steve you gave more of the FFO, but not so much the metric. Speaker 300:51:33Yes. No, I hear you and I'm not We have not disclosed that and truth be told that I want to have those discussions with the agencies Before I share any of that detail with the broader audience, so we are now given where we are with The contracted project transaction, now we're at a point where I can share some of that information, some of the details with the rating agency. So And I have a meeting scheduled over the next several weeks to be able to do that. Speaker 500:52:14Great. And then just curious on the selling and I apologize I'm using just a different word. You may answered this with Shar's question. Once the sale is announced and once the sale closes, are there is there potential for further liabilities you have to be concerned with or the expectation is once there's a sale and the sale closes, there's no more impact to Eversource? Speaker 300:52:43Those are the what we plan to disseminate once we execute the agreement. But as I said, there will be some potential movements up or down. Speaker 500:52:56I'm sorry, potential movements after the close that could be up or down. Is that fair? Speaker 400:53:03Correct. Speaker 500:53:04Great. Thanks so much for taking my questions. I really appreciate it. Speaker 300:53:09Thank you. Operator00:53:13Our final question today comes from the line of Julien Dumoulin Smith with Bank of America. Julien, please go ahead. Your line is now open. Speaker 700:53:23Hey. Good afternoon, team or good morning rather, I should say. Thank you guys very much for the time. Just following up on a few housecleaning items here from the prior questions. Just clearly, when in your forecast do you assume Connecticut electric and natural gas rate cases, obviously you're holding to the upper end. Speaker 700:53:40Just wanted to clarify when you think you'll pursue those? Speaker 300:53:45On the electric, as we continue to state, our settlement agreement allows us to Meet the 4 year review period and that review period will expire in the fall of 2025. So we do not expect to file a CLMP case prior to that date. And if you look at The length of time it takes in a general rate proceeding, you're looking at a year. So with that timeframe, you're probably looking at The earliest date that rates will be changed would be early 2027. And then for Yankee Gas, Julian, we have no plans right now to file a rate proceeding. Speaker 300:54:33So we'll continue to monitor that as we always do, but we don't have any current plans to file. Speaker 700:54:43Got it. And no changes to your CapEx forecast for now, right, in Connecticut? Speaker 300:54:49That is correct. Speaker 700:54:55Got it. Excellent. And then just clarifying earlier the FFO to debt, I know lots of questions pluses and minuses, but can you quantify the big building blocks as you think about through the forecast period, Especially through 25 here, I mean, I think I heard ITC earlier. Can you just clarify? I know that you got some legacy items that we talked about earlier, and thank you again, John. Speaker 700:55:14But on 22, can you talk about the big puts and takes here that improve the metrics prospectively Speaker 100:55:21Through the forecast period. Speaker 300:55:24Through the forecast period, through 2027? Speaker 700:55:32Yes. I'm thinking about not just like 23 to 24, but really kind of Speaker 100:55:36getting that sustainable structural level, Right. As you think about the things of Lindblad? Speaker 300:55:41Yes. Yes. I would say, offshore wind will be the kick stop To that enhancement, once we get those and offload some debt, I think if you look at the longer Term rate mechanisms that we have in place certainly in Massachusetts, that will drive enhanced operating cash flows And the recovery of strong costs, although for CLMP, it will be towards the latter part of the forecast period. But I think all of those items when you look at the cash flows in Massachusetts as I mentioned, We are putting into rates about $400,000,000 of deferred storm costs. And as part of the rate case, The amount included in rate base in base rates was significantly increased. Speaker 300:56:34So those are all of the items that will continue to have Enhance cash flows and then completing our $1,000,000,000 equity program Over the coming years, we'll certainly enhance that credit metric. Speaker 700:56:54And then just to clarify, your 24 metrics here, do they benefit in FFO? Speaker 400:57:01Go for it. Speaker 300:57:02Yes. No, absolutely. I mean, we with everything else being equal, yes, we see 2023, as I I mentioned in my formal remarks, moving in the right direction from where we landed in 2022, and I see that trend Speaker 700:57:24Right. And 24 includes the tax equity in your FFO? Speaker 400:57:29Yes. Speaker 1100:57:34Got it. Okay. Excellent. Speaker 700:57:35Thank you. Really appreciate all the details here. Appreciate the cleanup. But best of luck, guys. Cheers. Speaker 400:57:41Thank you. Speaker 700:57:44Thank you. Those are all Operator00:57:45the questions we have time for today. So I hand the call back to Robert Becker for any closing remarks. Speaker 100:57:51Thanks, Emily. That concludes our call. Thank you for joining us today. If you have any follow-up questions, please reach out to Investor Relations. Operator00:58:01Thank you everyone for joining us today. This concludes our call and you may now disconnect your lines.Read morePowered by