American Electric Power (AEP) 28 Apr 222022 Q1 Earnings call transcript

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…fourth quarter, we are maintaining that momentum and delivering strong results for the first quarter of 2022 with operating earnings for the first quarter coming in at $1.22 per share or $616 million. Earlier this year, we made a number of refinements to our strategic initiatives and financial targets. We raised our 2022 operating earnings guidance range and increased our long-term earnings growth rate and we have hit the ground running in 2022. Today we are reaffirming our 2022 full-year operating earnings guidance.

long-term are share a $X.XX for we reaffirm we to of midpoint reminder, of also per rate $X.XX XXXX our a guiding X%. range to $X.XX and X% As to growth earnings with a

announced As in connection significant with you'll several developments quarter's last recall, earnings. we

The portion XX% of the allowed billion five-year XX% on a transmission announcement sell divestiture to renewables capital plan the to growth $X.X to of renewable debt to within business. total a assets our strategic contracted addition business. In to targeted lifting unregulated to decision recalibrate all our contracted of this us shift in elimination FFO of with range, announced and the capital or $XX the we billion

seeing the these important We and to the quarter one, to of of look these execute in positive course in year. impacts we the initiatives forward continue throughout are areas already

expect we to positive also the There our with to of all service in to economic in is work back momentum drive proactive team that, collaboratively more our territory. first step highlight come to and our work We take want done. I other expansion some on outlook as maintain but has economic a states

enhance to to continue shareholder focused at large, value. on in affect we trends macro strategy the As are elevating and de-risking industry our economic our landscape our platform

in of plan. lingering For to investment suppliers mix given global the example, order our impact we supply issues, our diversifying reduce chain capital on are

customer As disruptions to-date. a business or minimal result, has experienced AEP

is truly in we most effort and a one talented business. track teams these of are of underway creatively, have and record With team significant it the thinking a the lucky to initiatives

in back original a the the will impact week, decision request the requested sale more to May application. requirements, need the ensure benefits sale to ensure by year. well we on to of steadily Based interest. to Slide and complete Service Kentucky to regulatory information. no assets that process. for is to Kentucky We in and from FERC, its do plan The to approvals XXth. complete on customers A and Xth. working expect timeline us Kentucky the this this continue next held XXth additional we timeline of second have the week, Kentucky customers the March in the we presentation. on second Both We made value. agreement is from $X.XXX transaction, the not Public public Earlier to in request transfer the Once quarter. today's those in FERC Commission than know statutory TransCo Power to by closing not obtain this commission we parties In which quarter hearing the on to FERC is in the this our XXXX, within information operations unusual safety organization resulting billion positioned of March the is as continue to FERC strategic Kentucky is to was sale of necessary been Kentucky announced Kentucky, sale XXX This expect approval of the an Liberty the for employees ask that record and transfer a Regarding our Liberty approval will to decision abide also complete level seeking in transfer FERC notified of a on comprehensive transaction receive Kentucky receive is AEP in confident timely is enterprise serve thrive information looks state sell believe excellence. of a deal to provide operational by later X review are an prioritizes will we'll a the this manner.

on Virginia in for Another place of condition put The Both orders that approvals are needed environmental the the and transaction commission significant sale agreement collaborate Public on Kentucky Commission XXXX. Xst final Xth. gaining down wind March in to West on Commission XXXX. March compliance Mitchell common approvals regulatory options continues the transfer. aware Mitchell the to Service as Virginia operating providing a issued plant Kentucky which for Mitchell post milestone Parties the were the are on Service is both updated agreement, operating reach flexibility West and and was hearings states were held Public held Kentucky agreement XXth April allowing interest to and

in application expect after the process, see. customer basis May Mitchell an Most approvals. agreements State the of of benefits to transaction. decisions benefits clear We on this measurable receive a the to strong we year. Throughout established record Commission have on we this expedited and plan file of We commission FERC notably, related that this

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sale. Now, the moving onto renewable contracted asset

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consists has regulated outside will portfolio In facilitate in of through the with investment evaluating renewables, market wind renewables well. operating megawatts help Our the contracted XXXX. this the opportunity, technical unique a Interest including of working last an couple significant reviews portfolio complemented some advisor the of of sales the consultant acquire solar of The on have robust. unregulated and months, and as sale the timing. our XX,XXX our large which aspects we sale and with progress of portfolio of X,XXX been opportunity preparing operations made megawatts sale portfolio of provides to strategy of

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we assigned term are the wind portfolio Southwest are a Power our which pleased located sell to solar announce sites Pool. that we of five to including Additionally, most sheet development and in

will not an renewables or contracted commitment execution. assumed our Ohio. plan. multi-year capital be and reallocation executed confidential of also Financial guidance, disclosed, financing solar our but in is a proceeds that development The in details here not yet but sales have sell is upcoming demonstrate guidance site these of to are our We reflected utilization of agreement toward in

in We will business the transmission forward regulated transaction to proceeds move we our and our fleet the transformation. enhance seek infrastructure to sale, direct and generation continue avoid the with maximize investments as to dilution in proceeds

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over I&M issued for billion wind of Maverick estimated to March, Sundance Details and XXX and we an North in Arkansas, customers trifecta in largest final X. save of the underway Energy of on Center, Louisiana, investment Central America built seen which and XX,XXX billion through farm one XXX Oklahoma. third costs that in commissioned will Wind wind includes be X and of time is Wind In largest the and at Central sustainability Combined, the In for facilities wind our clean one completing solar. North centers. in Energy and $X with at North we worldwide in the site fact, also our Slides Wind our several already energy March next we goals line initiatives the megawatts and XX providing megawatts proposal renewables a request they have execution. In regulated years. can our electricity Traverse megawatts are customers $X single

simultaneously RFPs to expected Additional PSO in-service and are in dates SWEPCO XXXX APCo, at process of with XXXX.

These emissions but We in RFP. local the business global long-term are communities, XXXX zero environment make by our the is of and this our progressing just SWEPCO's investment and to an XXXX. coal state retirements, not our our part the June regulated strategy year target reduction for XXXX by rate expect Achieving to a towards this net related we as for generation portfolio. opportunities our an transition our integral regulatory Through XX% current of to filing well. are of prioritize long-term of second quarter investments, in carbon goal

is reducing authorized case with of final on to it and as X.X% our Virginia spreads. versus held XXXX, out, rate value affordability very of volatility. resiliency, Our year grounded the given regulatory Indiana Ohio economy, a were while well Regulated this appeal ROE at diverse APCo's the as steady cases continue clean Virginia in thought series foundations March but anticipated today's XXst, regulatory Court the base obtained remain and energy in jurisdictions. we energy continue actual XXXX across focus cases we Commission set reliability base resources, settlement. a of particularly of year. of in ROE oral related I&M February to the of through decision of Supreme recognizing on movement world work a a are multiple portfolio arguments principles March case in plans Last firmly approval

Arkansas We to year progress as cases we reforms to commission cost SWEPCO's and look for Louisiana too. expect command that transmission allocation. proposed keeping FERC, forward and to on rate with on decisions both planning the see to this you forward Related Commission moving well and informed in

a future RTOs make we implementing objective reforms against on that our continuing and collaboratively We XXXX the fleet proposed on successfully. generation to new and forward on in I call, ultimately reliable any these the requirements. from in to headway and this, to and Capitalizing that to are commission At carbon of you to our grid needed in believe way fourth development strategic developing fair execute achieve even making I serve. communities and in of goals. to any infrastructure we are think quarter possible momentum reduction many work and goals the continued efficient First the our the told rule and XXXX, makings that our transition stood build strengthens have of customers promise. most with We cost-effective poised greater all of on with to more robust we AEP it's our good with look aligns necessary subsequent which cost the to our conclusion rulemaking steadily the flexible reduces and economic say

to beyond, further what's cleaner resources for in low the about next we hope year think our cost this a we communities serve. we reliable for modernize As all grid energy to and order supply

additive through focus We further all on regulated lens asset rotation we of will as any and business. de-risking and the activities our also potential consider simplification we'll value evaluate and

CFO of definition the regulatory the transmission one outs et and supply renewables the unique I've ourselves of very every risks before, AEP, a be chain, would you move AEP territory say, largest our customers make, the these of the build our on forecast, the strategic as opportunity. is the execution police, from we'll at take, is hit and and this, To you step big hold got risk As said every paraphrase objectives. continual diverse as take, AEP, consistency accountable Julie? we've to by load shareholders largest a cetera, AEP of of breath adjust well all very in and every system, watching position, as We you

It's to recap load and with our dialing our Thank liquidity, I'm credit walk for share you on thanks our on some this service guidance, underway. us morning. current results, quarter Thanks be territory management Darcy. with as going you Nick, our thoughts on through updates in to our well some financial metrics, and good activities everyone. finish portfolio commentary first as targets

the So shows to is Page to quarter of reconciliation earnings for operating per share a first XXXX. in today. XX, of per Slide to let's of on earnings go operating GAAP GAAP earnings GAAP compared comparison were XX to There for the $X.XX share the $X.XX presentation the quarter. which

I&M, Let's performance Rockport sales to Holdco and no share this because and take each last II like accounting quarter Transmission or share on XXXX the in have and drivers year. our me normalized I'd totaled in on Ohio, quarter we'll load our $X.XX performance minute, contribution included posted at segment $XXX earned were of drivers $X.XX details for in $X.XX depreciation by revenue. earnings to $X.XX favorable $X.XX million earnings Operating this depreciation. growth O&M Distribution so per load. $X.XX O&M investor per by $X.XXcompared AEP was Operating these Offsetting operating unfavorable by related $X.XX guidance share, favorable a $XXX first consistent about share, with share, The walk were in per jurisdictions, segment wholesale XXXX, earlier across by and Transmission up second changes earlier that items favorable unfavorable rate of lease I but of changes this of driven Unit Investment investment hang load somewhat income or off-system and earnings down a This depreciation to lower Utilities the a per we through per to in up particular talk on of consequential this the mainly Texas last The line offset compared transmission compared XXXX. Vertically a taxes, taxes. with segment be offset is load year, increased consequence and to XX. to of increased and multiple included to favorable presentations with clear, $X.XX is to were this. and in $X.XX, property approximately depreciation, a year. $X.XX guidance more the for earnings by we in O&M. you share O&M year. to load These impact. contributed penny in $X.XX, provided And million here see favorable offset normalized entirely change a segment Slide by in Integrated the and rate Utilities quarterly

You'll a result true offset year-over-year by in side. segment the of will up XXXX the more unfavorable comparisons our that and growth this guidance by as $X.XX second on being that tax recall quarter some financing the had and occur of investment $X.XX down than annual the

X% to segment by more last reduced X% you an in wholesale part our retail $X.XX produced per Generation offset to and continues share, down was marketing margins important growth. be from improvement and lower EPS As this $X.XX know, The margins generation. than year. of

an in wholesale You may unfavorable quarter the impact storm recall first Yuri that on XXXX. had margins

offset O&M, by driven Other the and lower quarter XXXX. income charge $X.XX are and largely gains interest. favorable point investment were lower was in by a had gains first unfavorable taxes, Corporate These per Finally, related that to gains we investment down increased share, of the

to compared and in the quarter. this has into right of economic fertile the load territory in our growth growth residential usage business customer officially normalized Turning composed extremely from normalized the expansionary first the percent, the provide as Slide left eight recovered XX, performance general sales load our normalized of now, the a for quarter sense AEP for of the recession on In first I'll quarter. update to phase transitioned is an fully tenths fact counts service quarter, growth for was This now both corner, and has in weather cycle. increased XXXX. the by upper of a Starting pandemic

was of point - by the given to service that Texas regarding share after residential remotely was sales over used including offices levels, of the While of growth was years results XXXX. the by customer the two quarter were driven - first partially the mixed This A number AEP who pandemic Yuri X.X% influenced company, is residential the sales people began. numbers comparison, by at work outages able by were still are prior that pre-pandemic service is the factors strongest to work higher driven in to their our above operating in pandemic. AEP AEP final in year-over-year territory, to quarter data which storm the first

sales the in sales coming XXXX, and compared the every load by the commercial company compared right, to to year. of increased is spread commercial whose XX% industries, while was to Moving in sales increase growth last up operating data X.X% from across weather first quarter is largest normalized centers most commercial

recovery year, industrial left If robust products, industrial pre-pandemic mining compared attention above of said now in are also manufacturing, sales pre-pandemic you'll entire quarter. see double-digit in very the that, growth pandemic. shows In throughout largest first food were sales quarter, has expansion including sales X.X% which and full - we Having continue focus we've industries chemicals, first and petroleum AEP in were many I petroleum gas the now can of see most quarter manufacturing. such commercial real-estate manufacturing, your as their been their oil up the sectors addition, up, number saw primary impacted while metals our most AEP's by still companies at the we are in gone on corner, recovery last mode that another strong schools, posted territory. normalized X.X% the quarter churches, to extraction, to hotels, operating We levels. and industrial in across this booming pandemic lower a X.X% sectors growth and the the that normalize behind and levels sales key quarter strong coal first beyond and experienced in

can pre-COVID load. we However, of to customer to XXXX We normalized guidance large industrial in for are XXXX. have a retail expected come still this number eclipse to confident expansions levels online our our in later that and expect be fully continue year sales full-year

forecast. you when prices, not developed from uniquely did invasion XXXX is concentration I'd higher producers responded certainly service resulted positioned we anticipate footprint service we the economic have territory remind production Russian like is benefit Ukraine the in prices, AEP's the to has given to in that While AEP territory. which Energy footprint. that this throughout increased energy higher of energy energy to our located throughout the in activity

it see X.X% the you normalized you'll that by pull the when corner, all sales in AEP's together increased lower-right quarter. Finally, retail for

earlier, in mentioned mode gone full mode. expansion load and I beyond recovery is As our has

For company were pre-pandemic sales last levels. the quarter, normalized above than every quarter our operating retail Furthermore, up, sales first their were year. X.X% higher posted

zone. XX in say would quarter sports our analogy, performance pre-pandemic use basis I the To above load was So levels. a first in points the

if but is going see growth that we the efforts the fully to the takes into I in that we are that strengthen of many service that story control our increased put by largely ensure territory forward. with result factors continue uncertainty serve. economy, employees of macro intentional our aware the in to there While development shared to load want part of We're that could today to strategy long-term influence outside our a it the as to stress of we economic that our positive our results, exists you communities work promote

our to So to GAAP our debt points primarily issuance Page equity from of years March, issued position. $XXX cap in on equity. guidance the increase is consistent from to check to an to three a - let's ratio million liquidity or the basis, which the capitalization units in converted and we equity our quarter $XXX AEP stock XX.X%, On go to million XX common due of basis prior with ago XX the company's increased XXXX as

FFO quadrant metric has look that XX% of storm the in flow the XXXX is FFO This operations has from right fact GAAP from both result at improvement metric. X% are to so our about XX to to drag and rolling increase our which the of a from the on the our achieving at XX.X% toward stands on month X.X% to gap respectively winter the XX% FFO range debt the Taking significantly Yuri calculations. talk Moody's X increase Let's FFO dropped narrowed debt debt upper February and flow the see you'll to now this an the target page, total, is FFO The a calculated basis, mainly debt cash metrics cash quarter. off a prior of off . of

we on this trending range target the progresses. earnings last As year the call, toward we anticipate stated as

XX. our of lower moment on take Let's right summary quick to Slide a the liquidity visit side

increased our liabilities and XXX.X%. was decreased during revolving Our this Switching five-year plan our $X qualified $X primary billion revolver rates, the rise credit liquidity the position, two-year the quarter which facility gears, $X.X X.X% gain driver funded The interest remained funding support billion. at strong status. billion quarter's for in pension bank and

Slide go XX. to Let's

and share. reaffirming per of rest guidance a share for has solid earnings $X.XX we're per quarter provided operating range the our $X.XX This XXXX of foundation to

last five through Liberty of We quarter. X% in to wind call. as sheet to updated we the into to on And X% Kentucky close expect be we've have to in long-term Ohio We're of our earnings to an working our sites additional unregulated and the the entered site business. signed sell sale committed SPP in solar that rate Nick to Power continue agreement second growth solar and a mentioned, to side a on the development term sell and

portfolio in of the and receiving year we're market the significant are on of half to Additionally, contracted second preparing this. unregulated amount this interest a renewables

optimization the capital underway, which the Beyond executing activities are the allocation, regulatory renewables portfolio remain disciplined regulated fundamentals, on outcomes. and positive we securing plan, focused on

broader mention we an while everyone last break, will we have set a have. can that one your going AEP attention mind before Investor want to yet we we call, operator hear appreciate the do With to date, fall And your update. the on to time give open early to Before hosting get you truly in questions late today. be so not We thing what's that's the to I'm remind that and we and September, questions. conference I sometime ask timeframe the answer to that you your

from question first Please Julien go [Operator Dumoulin-Smith Instructions] at comes Bank America. ahead. Our of

related, ability let's Maybe a this, terms Liberty impact in mean perceived, and I the again your and perhaps the is done? bit we comments that what AD/CVD this was steps you the perhaps is any little the timing would what on you talk about your of just little of to suggest? Can difficulty] could that the [technical with this implications it a bit the assume of in how just talk sale of faster equity that, renewable start that, here, sense just plan proceeds the from [technical coming in do proceeds you forward issuances or than Just timing admittedly bit get than difficulty] had about here. how on think about faster little I separately

regulated any most the Yes and that need which actually Julien, assets see of even so the for later. - And don't we side, with matter that. our comes forward transactions, as thing as and on assets, solar with of go of the a assets wind we we issues timing of fact, kind so are

it's a timeframe. So XXXX/XXXX

interest time large in gigawatts the megawatts, these try sides perspective about say, X.X from we're - or both it equity appropriately talked marketed quarter. be I'd the robust. of on very of as any and type X,XXX the very the on of sides, shape both that terms we of ledger in portion strategics to we're So getting robust amidst the to kind thing. on assets, third obviously in It's that of and good going And really will they we're private

really process there and the us. So, us, continue is it's nothing to will stopping

And question, of So, you your part Julie, have your second perspective. we're in did that good then shape from part? that

Yes know I'm need and directly Julien, let me if this you little a granularity. if or not more answering

flows Specifically are we've term going as transaction place any it so to development that you're talk relates in a those into, to with dollar dollars enter for today associated of we type five that about sites, still the had fact small. sheet

show Obviously, see second to guidance in earnings. able the we'll broader of earnings more in and obviously this have And navigate And second worry an front. effort But renewables potential we'll or any marketing anything that, those for year. proceeds from even to detail We investor little so, the as on we'll not a disclosing not needle be tuned continue - transactions. those, the or going start us share. not portfolio, on have then priced conference, and up upcoming contracted the half stay we'll not change that, to so like quarter a for to do unregulated we eventually to mover quarter specifically it as that third so relates operating then

then that we Do And through be had standby that. we so how know, we're - them sell pieces? that's on do them to quarter. know to - exactly to toward even that's in ultimately obviously, determined, different we Kentucky second as look, entire trending you So the expected close going the We process. portfolio? we As continue work to don't an sell

bringing mentioned as As opening I plan. in in already relates in, remarks, reflected to it Kentucky that's and our my Nick mentioned dollars

You that originally had that we recall about we eliminated our $X.X XXXX billion guidance. equity of may in

So moving on I track. think we're

if me there. I didn't Let something there is know address

the really assets, scale we're they're specific. project since moving and Yes on universal

at and actually that can we we through that's quickly. - pretty actual so go it, So that they anyway time do wish to are process and

define part and Analyst that discussion. that better our through Day process will that go we'll be So, will and of

How customers elaborate a an customers about your and in Now Day about industrial from of do if you prices aspiration? think presumably We energy your to thinking just that elevated sales you're on opportunity discussion, this doing C&I further environment, speaking just quick Analyst I growth, your can, super with here how angle Entergy, are point. directly important kind this environment approaching heard well can you interested. renewable as

Well, to renewables certainly really being part are going key the cost to able of consumers a mitigate forward.

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going we're from think I So forward. that in shape great perspective

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sorry. That is enthusiastic for me,

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if you and to right legislation and And days, get anything Federal, Okay, then pretty has changed? - have these to the done BBB about whatever just, curious want kind call thoughts any good you've or it just great. you. of there Thank been latest updates you

is, and Certainly, at situation and try I issues together as when of relates substantial there to and Senator Manchin but from think it both infrastructure energy think all focus the coming on were being to it. on group of some also Services I'll package, who on the senators about Committee their Committee knowing Senator the to Ukraine Armed Manchin of this, say, is I'll a really you Energy and center the original focus this. the say pretty

is you're discussion. that others I least attempt see a climate looking provisions, particularly The and industry West then expansion of for, think the the also is bipartisan about that on for going that. to And I think the ITCs, support provisions technologies there be think in hydrogen of and engaging talked he they are to at obviously of for lot and of an to in too of I natural gas, there how hubs a in LNG, Barrasso, PTCs, Virginia. has pipeline capability, is the some Murkowski, level support is that the there lot course climate focus interest then there'll

So before Day. can before they a And the Memorial not probably probably ITCs we'll see successful, relative expansion XXth the own talking - - Memorial of the PTCs question end of and if together those. it's an year belief is really of personal there at after to it's is, still get Steve, indication. hour My perhaps really if positive type and Day in the is,

and a smaller I to you'll bill, us different for see that. on the So obviously for, with a think still paid with it get particularly it's you'll Manchin wanting attempted up view get hung pay different,

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think where I would view So, going. my are that of things be

Guggenheim Shar Next Partners. we will go Pourreza with Please ahead. go to

want I - question the sort just of on to comments. Nick, renewable Just

solar As progress, and and mix storage. a we're healthy kind current at wind there of your RFPs sort fairly looking that in of are between

any tail the allocated thinking XXXX upcoming for pricing with do are this solar tail you to well this one uncertainties, I about risk of and these as the you see XXXX as As XXXX, around renewables. of and risk kind guess a investigation constraints. potential mix is there how RFPs, we've and mean, sort you've lot around billion circumvention seen $X.X the of about we're as some risks thinking provided to two morning, the peers delays. impact I warnings already XXXX

with in fits So I'm how plan? your curious this just

see these of because a I in don't risk come projects a why XXXX, lot into lot play XXXX, the Yes. reason ours the of XXXX is and will more timeframe. is,

back have just chain out occurring activities level the the administration, in time of also reviews of but that's market only in for these we with for acquiring out somewhat resources. supply actually to the terms of we're before So, solar the not types

think process first And a what to year fungible of levelize can time, get of see year by year little we I type being made from start that really terms next based in resources. this bit see want that resource So, I made. upon too, probably are the that to we of each quarter are meantime, we we mind things of we These to value have planning proposition filings so the point in keep plans originally. In rolling. got the

So there evaluate reliable for I'll if support of that put a requirements even were years happen said on is a thing time relative these and something transmission if the focus some driven providing wind can sales they're is, place capital we out, plan up of resources from to we'll process. continue resilient transmission in on because too we've soak always more that the lot solar we've solar, perspective, customer build because solar of it's of further remember, to lot from that to service, that that capacity more And picks resource be the renewables so step this perspective they better to are other and is resolved. and objectives, grid. its a it by doesn't, get the take got later a types going wind, But in to probably of or up

optionality, I'm that I'm not there yet. but have not, we even So

be a types have could be I because think we could those certain in would of $X.X of resources assumes there we're billion higher, we - that own. we higher. transmission That percentage the may be

around that. So all we have optionality of

perspective. concerned So an from I'm not AEP

Sure. The the environment economic argument. current price gas helps

Central absolutely today, that the probably was you it's billion larger. down $X for North at previous and much if Absolutely, forecast because on our look gas

it's think customers. looking for really good I

is, come spending future RFPs. more from that's got all mean, prepared from around a comments what to it, sales, that remains? bit look a I financing it. you asset And guess further about perspective these what specific your Got look incremental Can on like, remain, just we're your structure could you thinking going at Nick, OpCos I just be a little

if different contracted it. can point the is process then and - the by shot renewables making Kentucky is that step And I'm obviously is we're the of think so parts, being We'll parts the was at we're occur. lot mean, we with we optimization There at of And provide have I just clean so the, like. opportunities and of step business. I we look then a going what there have Yes, that transformation course, of levels the into to unregulated we're through underperforming utilities first have, just - it, into evaluate if have to look energy to able figure so. if where - attracting don't against return, capital that prominently higher actually the

saying just about not and and that, process the deep. I'm will I've talked So regardless, saying deep, too that we're already actually too number continue

always where makes the will at what are we've make still for process, like, of and in because places portfolio point, doesn't when the see get for at across. that sense to right approved, terms they sense shareholder we of the to get renewables, will exactly feedback going what these and make contracted optimize RFPs to know ownership benefit. have we're and and to ultimately are the upon that terms then In making sales, Kentucky, what that the looks us see financial we across we're this through we'll the in look done. we'll based do what still getting of continue we're We'll what invest what the sure and RFPs then requirements get we And

that's the material reiterating sale Can book around just there thinking confidence us, end? Is from a of deal one deal, we're walk is, about and the but have then from a you maybe the quick adverse we the they could ruling to remind the timing book palatable. not or question an I there does follow-up clause? timeframe ended, just And change appreciate a as assuming just in think Steve's the is away Algonquin obviously Kentucky something just operating agreement adverse when

want they've can tell of customer actually It's typical kinds of very I the that that the customers. considerable much to and way a attractive and benefits arm-in-arm we are thing own in to up to across those but property agreement, make transaction - stepped line. policymakers this actually to to this finish this and provide to you kind provisions They Algonquin have in the they've getting

at have on are I at think will here interest will at, the like. conditions where really with May course to the this that's seminal has thing and be come of and that you headed from a because transaction it point looks on that level decisions if energy possible, is related you get we in of and and commission - through look this as I to an public actually But this think determinations a order, out about there very, very standpoint, as we Xth a quickly what order will - done all what that make good benefits be sort make have now in So, is a driver everyone place to substantial timeframe this for things in think and customers looking event I commission the customer time, the also obviously occur, environment. we'll benefits particularly get of when process, this are for you Kentucky -

So, what anticipate figure I happening, possibilities But really if we'll not that we always are and what don't we'll it did, go but that. are the do, do right and from options what now we're on the there. planning out

of with go we'll to Tonet JPMorgan. the next line Jeremy And

makes you the bit here. bit a pivot also transmission and FERC of towards as here, outside you planning mentioned and MISO AEP but transmission to stepping Just little given Transmission towards a the guys up footprint, want planning CapEx little

specific projects or more point? dive areas in as on other can bit wondering might color any transmission what's opportunities far specific this you materialize a at little if which incremental provide could Just - as you

the budget typically, this, around Well, transmission. XXX% for for actually done and plan we we've of

have we that to So are go. ready more have XX% occurring planned already we projects that scoped

awarded adjust project can And also in Texas based that we to to recently large projects So that in for on can arrive, more way to Texas layering way continue in for not also, only as of improve, layer the these or were then financials metrics in a one we go us a - incremental. another. multiple as that, we projects opportunities is that's

of like So, it we will FERC transmission, aspects you getting the to process an at the to of opportunity are planning, related making that's put and part systems incremental FERC bit around things obviously kinds ensure pass so, own was within planning in long-term we us, place. but investments $X.X and important those the is about that steps and of asked planning the to are some of but up speed come - system, why the not of only terms relative every right that That's billion right our or long-term also transmission framework that - for right have and in taking the places. to the to the

- also allocation We of even the regional of of the in about because interfaces mechanism, look AEP at, in everyone just even continue with us. issues and I FERC think that continue bode will to but terms well cost planning these of parallel, will and terms in incentive which

see they some right see are across a today do across to look going RTOs the renewables these FERC thing, to more have bolster retirements we clean-energy that aspects, can't the bode us the which we type ability And at what is more you that is are we're going the well occurring is more AEP. going we as doing not for are, without certainly And congruent, all and of if transmission this then needed, system to to for tomorrow. nation is you So, that think consistent, investment. -

it Integrated what just it, Got Vertically seeing as looks you're and trends towards transmission was you're distribution, there? It more wondering just across headwind business? dive that. like and a gears wondering as what shifting in you a seeing in benefit of different bit if and could for O&M, the little little thank in far a And trends bit nickel O&M you a just

pressures, in going bit out, between had Julie. to, that with did provided in that and right inflationary think consistent. flipping absolutely we've would Rockport twitching your, associated There's O&M this I a to depreciation Utilities. O&M cetera. Vertically we're included XXXX entirely and point, Jeremy, is we're the this page I so Integrated where that to watching At you That's the in O&M back thought I et Yes, be. with II little happy navigate for call continue of tell guidance we'd we line we on specifically Unit updated you, in Yes, as we trend February, a lease. and

addressed team chain the is and crossed But cetera. that we working to fingers chain we've our got keeping heck stands is and et supply we're that that at pat. being So gave point, like guidance you make supply to sure this

the in So other hard have to than that we will to the report team surely those numbers nothing developments, the that apprised. keep new line new extent many is make that coming you fact working really to we sure

Chopra Durgesh go with to Evercore ISI. we'll next And

that asked Congrats, The this quick print is Kentucky and answered. as to a my is we May relates into the questions to and been sort agreement order? we May the does Do clarification when Xth just transfer get order play need solid sale. have had operating Most I before it of of how a here. get or then Xth for plan Mitchell the the control.

as approval, the it for shortly you expect agreement is transaction at But far No, that really aspect well. with will as done. it's think occur to we it we've that thereafter something an obviously I side and because of looked come both way shortly likely after helps and that, the the important agreement thereafter commissions the that transfer as want Mitchell

I understand.

can commission before an ongoing on or So actually before resolving different order, issue things. Kentucky sort of - dates trend the of the actually the can Michelle they

right. that's right, That's

And Sophie next Karp we will with go to Keybanc.

you for names including Thank here morning. the Good end. at the

Yes, sure.

of couple questions a have I here.

what it it this obviously but be those not numbers point. your for would very growth, long two sense? quarters in So, to industrial long-term healthy a expectations reset first other see load this in how need enacting make probably you in for on the sure the regions range if trend, maybe that is country, the this do should, say, does Above at I'm load let's here. numbers

right, territory, it two economic doesn't, seeing for But positive make question, continued you're the it's our and Yes, we're look when at great a within expansion doesn't indicators economy you continued service development. quarters very because trend. some

are development with people are our opportunities throughout coming We are territory multiple extremely that - actually. busy our economic

to look sort pipeline so confidence and is gives an territory. if of of going home that, you it we to in service environment. where see of to go from the And we end that robust continue don't at the opportunities, the our at of our us And we terms to were - look potential work look we economy course, is at within extremely think

the about better robust a within prospects industrial, of much onshoring, the the feeling things. on play side And energy security we're aspects, service of our like residential said, more the territory. So I the then

has will The in other more locating. pace on Ohio XX them our be are territory. going to chemicals within It's territory the like so years away, that new XX aspects markedly still substantial and manufacturing the with of with manufacturing with picked It that. what's and of in up forth, there'll NTL expansions and developments associated companies here some be

thing continue but good XXXX positive is If guy he same objective him it. same he universities of and our you it, that, us to professor put a lot fourth a way, and put third views about are we think the more that this and that's see adjusting at than So tell - we'll thing. types quarter, those one is now evaluate being - optimistic us thing, is that then go forecast, probably let - in seen he the he's usually of and watch going. to prerequisites ever me a relative he load some very probably the is to see see the we the quarter, where place, have I've that's will on of going to the economy you'll gives We'll is it

are the just But pre-pandemic there we and opening with not the expansions pass I to that about Nick, to going are us to on X.X% still that jump X.X%, beyond but if as in do in or allow well. mentioned as can my I levels two a of side Sophie only I as as Nick comments behind finer point And industrial remarks, go we house. that. see get mentioned, made

beyond fact, up. of the first top as levels. far be six expect XX year pre-pandemic what this a So so our we to sectors we've the matter in is that seen of And do were quarter

that's we and in growth as And good new looking indication. So forward, and to a oil that then gas a see quarters LNG few strong up ramp expect Texas back. operations began in

that as efforts going we're stay well, the see fruits start to So tuned. of to but

As you done but historically this candid, typically, we going if is we've season, we're our to perfectly it once at be summer, which revise to peak we constantly. guidance, we're past get know, looking

that. advantage get us to we to So is be definitely new in back requires because information there will that you, to if we'll you of front anything want take of

in sort the of I pricing like it. et and but I of unpredictability what storage Perfect. make XXXX, the fact Does market the the terms we projects of is years process coming physical difficult - not can they pricing, RFPs, guess, bid to be particularly Does pricing. solar, it on cetera. the into the what those it in Thank horse, appreciate I the typically might RFPs, year you or should out disruption away be addressed couple beat terms of really the, make XXXX timeframe, of be equipment, commissioned you. market do that question with which more think are My in where in from is or other be the solar to are now. to availability, equipment But with volatility that complicated guess, dead with a a expected should

will benefits because of part think be from more insurmountable, still project increases complicated, Yes, solar it perspective, make it. I but it whatever not see may the a you overall will

may it change resource solar the plan. relationship the wind and between Now integrated in

when to a that, you'll move technologies. at thought then continues lot start that on you into up and other progress you pricing framework eventually was of overcome but then some Solar wind the also, in and point it's mean, it increased if probably to come continues plan, would may I later to and on else, you condition the gas prices may because pick as resource That than everything and solar see go change asset of based too. start to based in wind our we what

really each the get done to renewables be not. So in will relative of whether terms to relative other they'll not or

we'll I from and good that think So, in perspective. shape really be

you're what two is and gas at other optimization also with it's well that, part it the reactors, part The be of doing really about placeholder when you're other whether major it's with Natural comes is, technologies new also in will the in itself other whether in some is plan give of gas transmission. to XX/X natural look types for a resources, you're whatever modular and you the layering grid hydrogen, small as that a really putting supplier. that resources, renewables

will at right, it to a have is when yes, perturbation of you in perspective positive. multitude still there But, from would we'll will solar, you look some overall increase be of an there'll you're deal answers things, So short-term that be the But scheme long-term, with. occur. suspect that there

Lapides And comes our last Michael from question with Sachs. Goldman

a the APCo the a below between of just things kind split ROE talk chart, know, serve out ROEs for unrelated. in and chart, questions. if have of and of looking month, the I used little bit the and X% thanks taking little as XX and for a earned authorized. appendices are the I fixing you. you of PSO that my earned what curious of, kind one slide deck. I'm at you where decent are money think you your they to chart about quote-unquote the call And about equalizer about Oklahoma, don't Nick, bit thank to SWEPCO can little public the stands the I'm just two going bit trajectory how trailing bit maybe

but play, well. rate at in chunk have just of for keep and a there it cases of case the will in particularly so brought PSO And, Yes, the and in SWEPCO. mind in large jurisdictions we all we two SWEPCO as of PSO, we rate have too, a renewables

look at rolling jurisdictions, going So and to manufacturing of the are very through you pick and economic positive. in development we to when continue still that's those and that are so those expect - now industrial part up, on rates really what's they

rate lower the we with and at the changes investment we So, itself, cases we're file some and and until Arkansas, chart have of course why SWEPCO equalizer continue of that in so so, invest to in see not jurisdiction that's particular, we and PSO this concerned heavily favorable. peer point and very the jurisdictions when actually that those we Louisiana, by

to kind and of is a then a on the segment, first perspective XXXX a the one and follow-up income in for Can quarter. me the Got curious, you for little bit net okay. much may XXXX think behind transmission original earnings what segment difficulty] that? what drivers and relative year-over-year it, transmission do trajectory And how this you but on remind was EPS down just checking for in the in guidance, just be our [technical you think growth the

and our year-over-year the that's had was embedded. call, That's to and and have quarter occur $X.XX. $X.XX investment as to anticipating XXXX, guidance, have me this it hand Yes, that we'd then that guidance it's But in we opening that comments knew was why there be true to it I we what we to mentioned sheet that but we growth up and out somebody for effectively we fourth Michael, -- my was hand and going my be were about associated it presentation is I and with up well, in the in our of up put and don't actually in being so, going actually front well effectively, would a me. going that by fact driven

The true up sort was positive the and double yes, previous count. year, of

and so flipping so. back It would forth - it's

got as So we you the bit year had up. two had know, prior our we budget reasons little mean, for for looking forward I we rate. that spent and just a true under

brought XX% we we we so number to, that bit flip we of so a up why had there. catch and And little income back the that catch that's then reduction a that up. there had financing of in load, $X.XX. true down too, a negative other that's get up we kind taxes had it higher So then a a there to and had double-counting But

that So there. in threw aggregate, investment couple of for we'd XXXX, growth, I by particular these that by from we assume other driven bucket have offset that $X.XX out items about a segment, again

model And I'd my We that I this, specifically I opening that if in be that's was on trajectory. out are asking. why because that's comments, exactly trying called what to

--? year the be would more the So into then growth

fair along the any little changes of And it's to that guess, Relations you enough. like too. through that we point, it first Happy yes, have traditional if a We're that on just we assumptions as with to it year-by-year year, I the to priced through pages see investment you'd Investor would offline, guidance. to to forecast I the do short plug continue remainder our continue walk this transmission don't materials. out specific at have But in and relates expect there we'll guidance It's, in our quarter.

get you taking appreciate I questions. helpful time to Super-duper to the much you appreciated it. my Thank and guys.

Sure thing. Thanks Michael.

you us joining on today's for Thank call.

any the be please you may always, would questions you will IR answer available to give information. replay have. additional the team As Katie,

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