Shawn Anderson
Executive Vice President and Chief Financial Officer at NiSource
Thanks, Michael, and good morning, everyone. I'm excited to share our 2023 financial results on Slide 10. Non-GAAP net operating earnings in the fourth quarter were $239 million or $0.53 per diluted share, up from $221 million or $0.50 per diluted share in the same period in 2022. This earnings increase is driven by regulatory mechanisms, recovering capital investment, partly offset by a modest increase in non-tracked O&M and higher interest expense. For the full year, we reported $716 million of non-GAAP net operating earnings or $1.60 per diluted share, up from $648 million and $1.47 in 2022, respectively. Across this period, regulated revenue returns were partly offset by higher depreciation expense, interest expense and lower other income.
On Slide 11, you'll find segment detail and key drivers of our results. For the full year, non-GAAP operating income increased across each of the gas, electric and corporate segments, accounting for a $209 million increase to consolidated net operating earnings. Capital expenditures fueled regulated returns. And as Lloyd highlighted earlier, we deployed approximately $3.6 billion in infrastructure projects to enhance safety and reliability of our energy systems. This drove an increase of $335 million through regulatory activity in rate cases and capital trackers across our jurisdictions. A growing customer base across our businesses also provided a lift in our 2023 financial results and supports customer affordability.
Demand for our fuel continues to be very strong, with residential customer count growing over 80 basis points in our gas businesses and over 50 basis points in our electric business last year, both of which enhanced the scale of NiSource. Economic development continues to thrive in the Midwest, and there is no better example of how this collaboration can benefit customers, communities and investors than in Ohio. Our operations in the state serve 1.5 million customers, nearly 550,000 of which are supported by our Columbus Operations Center. Public-private partnership has propelled Ohio's recent economic development success. In 2023 alone, 33 projects were brought to Central Ohio, with over $10 billion to investment being committed.
This momentum continues today, as there are nearly 100 active opportunities being pursued for future development, with the potential to create thousands of new jobs and invest billions of dollars more into Central Ohio communities. The majority of these projects are focused in manufacturing industries, representing a diverse range of sectors, including electric vehicles, energy storage, logistics, life sciences, semiconductors, advanced computing facilities and many more.
Additionally, Ohio will continue to see new corporate investment, driven by downstream supplier activity from megaprojects currently under construction, such as a joint venture with Honda and LG Energy and the Intel chip manufacturing facility. This development can enhance value for NiSource and create an upside to our plan from residential housing demand, which grows as these secondary businesses develop. Central Ohio's metro population grew an average of 1.8% annually over the last 30 years, and the population is expected to grow an additional 30% by 2050, boosted by strong economic development prospects.
Broad stakeholder and policy support is critical to onshoring and manufacturing success and will fuel healthy and growing Midwest economies. Our communities benefit from numerous constructive regulatory mechanisms that encourage energy infrastructure investment across our states, including economic development programs to spur investments in our region, which create jobs and enhance local tax base.
Switching to Slide 13, I'd like to highlight several key value drivers which represent the foundation of our long-term financial commitments. We have increased our non-GAAP net operating earnings per share guidance range for 2024 by $0.02 at the midpoint compared to the range introduced in November. This midpoint now represents a 7.5% year-over-year growth rate from 2023 actual results. The revised guidance is driven primarily by revenues from regulatory activity and enhanced customer demand and lower financing costs relative to our prior year forecast. These growth drivers, along with the strength of our infrastructure investment programs, underpin our expectation to continue to deliver annual non-GAAP NOEPS growth of 6% to 8% and annual rate base growth of 8% to 10% over the 2023 to 2028 period. This is driven by $16 billion of capital expenditures, and it is expected to approximate residential customer build growth to below 4% on average across the planned horizon.
Finally, in consistent with our last update, our base capital plan includes full ownership of Cavalry and Dunns Bridge II Solar projects, expected in service in 2024. Fairbanks and Gibson continue to be expected in service in 2025 using a tax equity financing structure. Our upside plan includes incremental capex associated with full ownership of these projects, as well as electric and gas investments, which Michael detailed earlier.
Our financing plan is outlined on Slide 14, which remains unchanged from our mid-November update. As we outlined in that update, we continue to expect to issue up to $600 million in ATM equity in 2024 and $200 million to $300 million of maintenance ATM equity annually in the 2025 to 2028 period to support our base capital plan. Within the operation of our at the market program, we retain the flexibility to include small, bilateral discrete transactions should they be efficient to execute. We also continue to reaffirm our commitment to an FFO to debt ratio of 14% to 16% through 2028.
In January, our Board of Directors authorized a 6% increase to our dividend, which is consistent with the annual increase authorized last year. This projects our annual dividend at the bottom half of our stated range for targeted dividend payout ratio of 60% to 70%. We will continue to be thoughtful about capital allocation in the high cost of capital environment.
The final two slides will conclude our presentation and focus on execution of our stakeholder commitments. First, our multi-year track record of execution and growth continued in 2023. Lloyd touched on the premium business plan we shared with each of you in November of 2022 and this represents the full year of execution of this plan. We continue to prioritize safety, while optimizing our long-term cost profile. We built on our superior regulatory and stakeholder foundation through the execution of four general rate cases and numerous CPCN amendments and capital tracker approvals. During the year, we invested over $3.6 billion to support our customers and keep our communities and our employees safe, all while enhancing the balance sheet afforded through the minority interest sale.
We are proud of the execution delivered by the entire NiSource team, including achieving a 9% year-over-year growth rate and landing at the high end of our guidance range. All of these investments and the long-term visibility of our results fuel our confidence to execute each and every year as we move forward.
As we share on Slide 16, each of the last three years, we've executed strong financial growth, achieving the upper half of our guidance range in each year. This is important. Each year we've done this, we've rebased future NOEPS guidance upwards off those actual results. We've accomplished this in 2021, 2022, and now 2023. And we expect to keep doing this as we move forward, exemplified by our upgraded guidance range with an implied midpoint of 7.5% over 2023's already strong results. And this is differentiated in our sector, which has delivered an average 5% non-GAAP NOEPS CAGR since 2021 compared to the 8% achieved by NiSource.
The underlying business plan, supported by strong regulatory construct in NiSource jurisdictions, coupled with responsible investments in identifiable regulatory programs, enable a reasonable return of investment over our plan. The confidence in these investments enables the rebasing of annual growth rate, which supports this higher NOEPS range as we execute the plan, which in turn enhances the future earnings potential of our business in each forward year of our plan. We are excited about the future prospects of our business and to continue building a track record of execution and growth.
We remain confident our commitments are resilient to rapidly changing business conditions, as which was seen across the utility industry over the last two years. Despite this, the NiSource plan is stronger than ever. Thank you for your time this morning and your interest in NiSource.
And with that, I'd like to open the call to your questions.
