Latest news with #DominionEnergyInc
Yahoo
01-06-2025
- Business
- Yahoo
Is Dominion Energy, Inc.'s (NYSE:D) 7.3% ROE Strong Compared To Its Industry?
While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. To keep the lesson grounded in practicality, we'll use ROE to better understand Dominion Energy, Inc. (NYSE:D). ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In simpler terms, it measures the profitability of a company in relation to shareholder's equity. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. ROE can be calculated by using the formula: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for Dominion Energy is: 7.3% = US$2.2b ÷ US$31b (Based on the trailing twelve months to March 2025). The 'return' refers to a company's earnings over the last year. One way to conceptualize this is that for each $1 of shareholders' capital it has, the company made $0.07 in profit. See our latest analysis for Dominion Energy By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. The image below shows that Dominion Energy has an ROE that is roughly in line with the Integrated Utilities industry average (8.9%). So while the ROE is not exceptional, at least its acceptable. Although the ROE is similar to the industry, we should still perform further checks to see if the company's ROE is being boosted by high debt levels. If so, this increases its exposure to financial risk. To know the 2 risks we have identified for Dominion Energy visit our risks dashboard for free. Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Dominion Energy clearly uses a high amount of debt to boost returns, as it has a debt to equity ratio of 1.45. With a fairly low ROE, and significant use of debt, it's hard to get excited about this business at the moment. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In our books, the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREE visualization of analyst forecasts for the company. But note: Dominion Energy may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Journals
07-05-2025
- Business
- Business Journals
Dominion CEO: Trump tariffs could add $500M to cost of gigantic Va. offshore wind farm
Richmond-based Dominion Energy Inc. says the cost of its massive Coastal Virginia Offshore Wind project could balloon by as much as $500 million if the Trump administration's tariffs remain in place through the project's targeted late-2026 completion date. So far, the project — which is being billed as the country's largest offshore wind farm — has incurred $4 million in tariff-related expenses, Dominion CEO Bob Blue said last week on the company's first-quarter earnings call.
Globe and Mail
01-05-2025
- Business
- Globe and Mail
Dominion Energy's Q1 Earnings & Revenues Surpass Estimates
Dominion Energy Inc. D delivered first-quarter 2025 operating earnings of 93 cents per share, which surpassed the Zacks Consensus Estimate of 77 cents by 20.8%. The metric increased 69.1% from the year-ago quarter. (See the Zacks Earnings Calendar to stay ahead of market-making news.) GAAP earnings were 75 cents per share compared with 50 cents in the year-ago quarter. Revenues of Dominion Energy Revenues of $4.07 billion surpassed the Zacks Consensus Estimate of $3.81 billion by 6.8%. The top line also increased 12.2% from $3.63 billion in the year-ago quarter. Dominion Energy Inc. Price, Consensus and EPS Surprise Dominion Energy Inc. price-consensus-eps-surprise-chart | Dominion Energy Inc. Quote Highlights of D's Q1 Release Total operating expenses rose 1.9% year over year to $2.85 billion due to an increase in other operations and maintenance expenses from the year-ago period. Dominion Energy registered attractive customer growth across its Virginia and South Carolina service areas and registered commercial load growth driven by Data Centers. Interest and related charges in the quarter were down 16.4% year over year. Operating earnings in the reported quarter were $803 million, up 65.6% year over year. Segmental Details of Dominion Energy Dominion Energy Virginia: Net income was $561 million, up 32.3% year over year. Dominion Energy South Carolina: Net income of $152 million increased 90% on a year-over-year basis. Contracted Energy: Net income of $109 million decreased 10.6% from $122 million in the year-ago quarter. Corporate and Other: Net loss was $19 million. This was narrower than the loss of $141 million in the prior-year quarter. Dominion Energy's Financial Highlights Current assets as of March 31, 2025, were $355 million compared with $310 million as of Dec. 31, 2024. Total long-term debt as of March 31, 2025, was $35.4 billion, up from $33.03 billion as of Dec. 31, 2024. In first-quarter 2025, cash (used) provided from operating activities was ($1.18 billion) against $1.98 billion in the year-ago period. Guidance of Dominion Energy Dominion Energy reiterated its 2025 operating earnings guidance to $3.28-$3.52 per share. The Zacks Consensus Estimate is pegged at $3.38 per share, which is a tad lower than the midpoint of the guided range. D reiterated its annual operating earnings guidance of 5-7% through 2029. The company expects to invest $50 billion in the 2025-2029 time period. Dominion Energy's Zacks Rank Currently, Dominion Energy has a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Other Releases NextEra Energy, Inc. NEE reported first-quarter 2025 adjusted earnings of 99 cents per share, which beat the Zacks Consensus Estimate of 97 cents by 2.1% NEE's long-term (three-to-five years) earnings growth rate is 7.72%. It delivered an average earnings surprise of 3.58% in the last four quarters. Edison International EIX reported first-quarter 2025 adjusted earnings of $1.37 per share, which surpassed the Zacks Consensus Estimate of $1.21 by 13.2%. EIX's long-term earnings growth rate is 6.97%. It delivered an average earnings surprise of 8.82% in the last four quarters. Exelon Corporation 's EXC first-quarter 2025 earnings of 92 cents per share surpassed the Zacks Consensus Estimate of 78 cents by 17.9%. EXC's long-term earnings growth rate is 6.42%. It delivered an average earnings surprise of 7.63% in the last four quarters. Zacks' Research Chief Names "Stock Most Likely to Double" Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest. This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months. Free: See Our Top Stock And 4 Runners Up Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exelon Corporation (EXC): Free Stock Analysis Report NextEra Energy, Inc. (NEE): Free Stock Analysis Report Edison International (EIX): Free Stock Analysis Report Dominion Energy Inc. (D): Free Stock Analysis Report
Yahoo
13-02-2025
- Business
- Yahoo
Q4 2024 Dominion Energy Inc Earnings Call
David McFarland; Vice President, Investor Relations; Dominion Energy Inc Robert Blue; Chairman of the Board, President, Chief Executive Officer; Dominion Energy Inc Steven Ridge; Chief Financial Officer, Executive Vice President; Dominion Energy Inc Diane Leopold; Chief Operating Officer, Executive Vice President; Dominion Energy Inc Shar Pourreza; Analyst; Guggenheim Partners, LLC Nicholas Campanella; Analyst; Barclays Corporate & Investment Bank Jeremy Tonet; Analyst; JPMorgan Chase & Co. David Arcaro; Analyst; Morgan Stanley & Co. LLC Anthony Crowdell; Analyst; Mizuho Securities USA, LLC David Paz; Analyst; Wolfe Research LLC Operator Welcome to the Dominion Energy fourth-quarter 2024 earnings conference call. (Operator Instructions)I would now like to turn the call over to David McFarland, Vice President, Investor Relations and Treasurer. David McFarland Good morning, and thank you for joining Dominion Energy's fourth-quarter 2024 earnings call. Earnings materials, including today's prepared remarks contain forward-looking statements and estimates that are subject to various risks and uncertainties. Please refer to our SEC filings, including our most recent annual report on Form 10-K and our quarterly reports on Form 10-Q for a discussion of factors that may cause results to differ from management's estimates and morning, we will discuss some measures of our company's performance that differ from those recognized by GAAP. Reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measures, which we can calculate are contained in the earnings release kit. I encourage you to visit our Investor Relations website to review webcast slides as well as the earnings release today's call are Bob Blue, Chair, President and Chief Executive Officer; Steven Ridge, Executive Vice President and Chief Financial Officer; and Diane Leopold, Executive Vice President and Chief Operating Officer.I will now turn the call over to Bob. Robert Blue Thanks, David. Good morning. Almost a year ago, we concluded the comprehensive business review and described five key tenets upon which the repositioned Dominion Energy would be premised. Strategic simplicity, consistent long-term financial execution, balance sheet conservatism, dividend security, and the delivery of an exceptional customer experience that would enable us to advocate for and achieve balanced policy constructs and reasonable regulatory heard from me and directly from members of the Board that we would collectively be accountable for the company's future performance. Finally, we committed to being 100% focused on successfully executing against our updated plan. Now a year on, none of that has changed. Those commitments are as equally fundamental to our company today as they were 12 months know that to rebuild your trust, we must deliver consistently over the long run. While we're still relatively early in this new chapter of our company, we're off to a positive back at 2024, we accomplished operating earnings per share in the top half of our guidance range despite weather headwinds. A remarkable storm restoration effort in South Carolina in the aftermath of Hurricane Helene, one of the region's most destructive storms ever. Regulatory outcomes in South Carolina and North Carolina base rate cases as well as a number of Virginia Rider cases that demonstrate our ability to work cooperatively with regulators and stakeholders to deliver results that benefit both customers and significant derisking of the Coastal Virginia offshore wind project through both the continued on-time achievement of major milestones as well as the closing of a 50% non-controlling equity financing through which we've materially reduced project risk for our shareholders. I'll share more perspectives on CVOW a little later in our prepared did all of this while achieving a near record-setting employee safety performance and advancing our all of the above strategy to reliably and affordably meet our customers' rapidly expanding energy demand, which includes the largest data center cluster in the me now turn it over to Steven to provide a financial update before I walk through additional updates on the execution of our plan. Steven Ridge Thank you, Bob, and thanks to everyone for joining today's call. As shown on slide 5, full-year 2024 operating earnings were $2.77 per share in the top half of our guidance range despite $0.03 of worse than normal weather. Full year 2024 GAAP earnings were $2.44 per share. Our fourth-quarter operating earnings were $0.58 per share, which for this quarter represented normal weather in our utility service areas. Fourth-quarter GAAP earnings were $0.15 per always, a summary of all drivers for earnings relative to the prior period is included in Schedule 4 of the Earnings Release kit and a summary of all adjustments between operating and GAAP results are included in Schedule on earnings guidance, we've narrowed 2025 operating earnings per share guidance to $3.28 to $3.52 per share, inclusive of RNG 45Z credit income while preserving the original midpoint of $3.40. We provide a range to primarily account for variation from normal weather. We're reaffirming annual operating earnings growth guidance of 5% to 7% through 2029 up to 2025 midpoint of $3.30, which excludes the impact of RNG 45Z credit income due to the legislative sunset of that credit at the end of a reminder, we continue to expect to see variation within that range as a result of the Millstone refueling cadence, which requires a second planned outage once every third year. We're also reaffirming our previous guidance related to the dividend. We expect to maintain the current dividend level of $2.67 per share annually until such time as we achieve a utility industry-aligned payout now to capital investment. We've updated our five-year capital forecast from 2025 through 2029 to $50 billion, an increase of 16% from our prior guidance. We're seeing the need for incremental investment across distribution, transmission, and generation to ensure reliability amid continuing growing demand in our service with our increased focus on transparency, we provided comprehensive and detailed disclosure in the appendix of today's materials. So I'll just hit two takeaways here. First, approximately 80% of the capital increase is at Dominion Energy Virginia driven by higher transmission, distribution and nuclear subsequent license renewal spend. And second, 60% of the updated capital spend will be eligible for recovery subject to regulatory approval under rider mechanisms. This is an exciting update, and we're confident in our ability to execute for the benefit of our of today's forecast, we continue to see opportunities for additional investment across the value chain, biased towards the end of the decade and beyond. We'll include those opportunities in future updates as warranted by their development status. Before I discuss our financing plan update, I'll affirm our commitment to balance sheet conservatism as demonstrated on slide the five-year plan, we expect our parent leverage to be consistently below 30% and our FFO to debt to be approximately 15%. Finally, we target mid BBB range credit ratings for our parent company and single A range ratings for our regulated operating companies. No change long-standing focus on achieving and maintaining these ratings is important for our ability to continue to secure a low cost of capital for our turning to the financing plan on slide 8. We're providing a five-year look at sources and uses, meaningful operating cash flows, combined with a balanced mix of external financing, satisfy our capital investment and dividend forecasts. Since the last update, we are modestly increasing external financing across debt, hybrid and equity on equity, you'll note on slide 9, an increase in 2025. As of today, we've already sold $600 million through forward-settled sales under our existing ATM program, expect to issue $200 million throughout the year through DRIP programs and expect to satisfy the balance of the approximately $300 million need through the 2025, there have been no changes to our common equity issuance guidance. We view this level of steady equity issuance under existing programs in the context of our sizable growth capital spending program as appropriate to keep our consolidated credit metrics within the guidelines for our strong credit ratings I hand it back to Bob, I'll note that we're pleased with our 2024 financial performance, but it's really all about how we execute going forward. Since the March 1 meeting, we've seen tailwinds like increased regulated capital investment opportunities, and we've seen headwinds like higher interest rates. But what hasn't changed is our confidence in the plan, which has been built to be appropriately but also not unreasonably with that, I'll turn it back to Bob. Robert Blue Turning to safety performance and affordability on slide 10. We achieved near-record setting safety performance in 2024 as measured by our employee OSHA injury recordable rate. On affordability, our rates continue to be lower than national and regional averages. We're intently focused on ensuring our service isn't just reliable, but that it remains appropriately affordable as on our Coastal Virginia offshore wind project. We provided several updates last week, but I'd like to start with a few project highlights on slide 11. First, the project is 50% complete and on schedule for completion in 2026. Second, CVOW is supported by Virginia law and approved by the State Corporation Commission and federal CVOW will provide much-needed new generation to support America's AI and cyber preeminence in the largest data center market in the world. Additionally, the project represents the fastest and most economical way to deliver 2.6 gigawatts of supply to Virginia's finally, CVOW has created approximately 2,000 direct and indirect American jobs and generated $2 billion in American economic activity, in addition to having the robust bipartisan support of Virginia's state and federal elective leaders. In summary, this project is consistent with the goal of securing American energy dominance and is part of a comprehensive all-of-the-above energy strategy to affordably meet growing energy on recent construction progress and milestones. In 2024, we completed a very successful first monopile installation season. And work has continued this winter on export cableway as well as transition pieces and in the coming days offshore substation shown on slide 12, we began installation of transition pieces on December 31, and have since completed installation of 20 in total. The first offshore substation [jack] and topside were delivered to Portsmouth at the end of January and will begin installation later this month. The remaining two offshore substations are on track to be delivered this summer and installed in the fall after completion of monopile season in materials and equipment, thus far, 130 monopiles have been loaded out with 116 successfully delivered and 14 more in transit to Virginia presently. Approximately 75% of the projects monopiles are either installed or awaiting installation. Our partner, EEW, continues to make strong progress, and we expect deliveries to continue steadily in the coming of the project's 176 transition pieces all have been rolled. Of these 152 have been successfully steel-welded. And of these, 91 have been completed, representing over 50% of the total. We expect the final transition piece to be completed in the schedule for the manufacturing of our turbines remains on track. As a reminder, Siemens Gamesa, the project's wind turbine supplier is manufacturing the same turbine model for CVOW as has been successfully fabricated, installed and is now operating at the Moray West Offshore Wind project. Eight towers have been completed with an additional 31 in progress. Blade fabrication is now underway and we expect sell production to begin next to regulatory. We made our quarterly offshore wind construction update filing on February 3, accompanied by a detailed explanation of the change in project costs from $9.8 billion to $10.7 billion. Let me share a few thoughts as you would expect, the cost increase is disappointing. We take great pride as an organization and delivering on time and on budget. Since the original cost submission 40 months ago, we've spared no effort institutionally to maintain fidelity to our original estimate. Ultimately, despite having about $300 million budgeted for network upgrades, which was more than sufficient based on PJM's initial estimates, that estimate has proved too electric generation resources constructed within PJM regardless of their generation type, our signed cost by PJM that are deemed necessary to effectively integrate these resources and ensure the reliability and stability of the electric network upgrade cost estimates by PJM reflect the significant increase in demand growth that requires incremental generation transmission resources across the system. I think it warrants noting that the aggregate cost for other project inputs, including offshore scope have remained in line with the original network upgrades do not impact project construction or time line and represented the largest unfixed project cost by far. We now have a much clearer though not final view of those costs. Further, we've refreshed contingency to represent 5% of remaining project cost sharing and risk sharing is working as intended to protect customers and shareholders. As a result of the cost-sharing settlement approved by Virginia regulators, the project cost update is expected to increase residential customer bills by an average of $0.43 per month over the life of the project. And the updated LCOE continues to benchmark very favorably with new generation alternatives, including solar, battery, and gas-fired generation. CVOW remains one of the most affordable sources of energy for our the $900 million cost increase, 80% or $700 million is expected to be recovered via [rider] and added to rate base subject to regulatory approval. 50% of the nonrecoverable portion of the increase will be borne by Stonepeak rather than Dominion Energy I know investors are very focused on the probability of future cost increases. I recognize the critical importance of executing against any guidance offered. The project is on time, and we're committed to delivering it in line with the now updated cost estimate. We don't have perfect insight into the information that PJM will use to finalize costs by midyear, but we've done a significant amount of analysis around the most recent estimate, which informs our updated cost estimate.I am confident in our updated estimate and believe that if there is a revision up or down, with respect to PJM network upgrades come July, it would not be of a similar a few updates on Charybdis, as shown on slide 16. The vessel is 96% complete, up from 93% as of our last earnings call, and sea trials are underway. What we're showing there is a picture of the 30,000-ton vessel fully jacked to its full height of almost 400 feet. We continue to expect Charybdis to complete sea trials in early 2025, consistent with our previous schedule and be delivered to CVOW in the third quarter. There's also no change to the vessel's cost of $715 now to data centers. We continue to see exciting developments here. So let me share a few updates. First, where things stand today. Virginia hosts the largest data center concentration in the world by far. Since we started tracking, we've connected approximately 450 data centers, representing nearly 9 gigawatts of capacity. Data center sales today represent about 26% of total sales for centers are attracted to Virginia by connections to world-class fiber networks, Virginia's attractive business climate, availability of a trained workforce, and access to our affordable, reliable, and increasingly clean energy. In recent years to address this demand, we've advanced electric transmission projects to bring both new and upgraded infrastructure to enable continued connection and expansion of data center customers in Eastern Laban County, work has included reconducting lines, expanding substation infrastructure, as well as building a 500 kV transmission line that we expect to complete on schedule by the end of 2025. Further, just last week, the SEC approved another 500 kV line in the Eastern Loudon County that we expect to be in service by year-end 2027, and that will allow us to stay ahead of the region's rapidly growing electricity where do we go from here? The PJM DOM zone is experiencing unprecedented load growth. This growth is accelerating in orders of magnitude driven by: one, the number of data centers requesting to be connected on to our system; two, the size of each facility; and three, the acceleration of each facility's ramp schedule to reach full some context, as shown on slide 17, PJM recently updated its DOM zone forecast, but now projects peak summer load growth of approximately 6.3% per year for the next 10 years. To put that into perspective, the resulting peak load projected for 2034 has increased from 26.1 gigawatts as of the 2022 PJM estimate to 41.5 gigawatts as of this year's estimate, an increase of nearly 60%.Last year, we implemented changes to our process on how we handle new delivery point requests on our system. This change will allow us to organize load requests into batches and serve them in the order they are received. Since we began communicating these changes, we've seen an increase in demand from shown on slide 18, we've updated our data center contracted capacity. We now have approximately 40 gigawatts in various stages of contracting as of December 2024, which compares to around 21 gigawatts as of July 2024, an increase of 19 gigawatts or 88%. As a reminder, these contracts are broken into one substation engineering letters of authorization; two, construction letters of authorization; and three, electrical service customers move from one to three, the cost commitment and obligation by the customer increases. We're currently studying over 26 gigawatts of data center demand within the substation engineering letters of authorization stage, which means a customer has requested the company to begin the necessary engineering for new infrastructure required to serve the compares to approximately 8 gigawatts as of July 2024, and represents a remarkable 245% increase. We've analyzed the data several ways. And certainly, we believe some of this growth is attributable to the new batch system, which naturally insists customers to get into the process early. But what's undeniable is that data center growth in Virginia is not slowing down. In fact, it's accelerating, and we're taking every step to meet this are also about 5 gigawatts of data center demand that have executed construction letters of authorization, which are contracts that enable construction of the required distribution and substation electric infrastructure to begin. Should a customer in this stage elect to discontinue a project, they're obligated to reimburse the company for its investment to the nearly 9 gigawatts included in electrical service agreements, or ESA, represent contracts for electric service between Dominion Energy end customer. This has increased by nearly 1 gigawatt since July of 2024. Each contract is structured for an individual account. By signing an ESA, the customer is committing to consume a certain level of electricity annually, often with ramp schedules where the contracted usage grows over Steven mentioned, this is all evidence of opportunities for additional investment across the value chain for many years to come. Turning to slide 19. Let me highlight a couple of additional business updates. First, an update on our transmission business and the joint planning agreement with AEP and FirstEnergy. A package of our own and jointly proposed projects has been shortlisted by PJM in their open window process, which is ongoing with final approvals expected this share of the joint planning agreement will lead to approximately $1 billion of incremental capital spend in the five-year plan. When combined with our other DEV transmission projects, this will result in annual transmission capital spend of greater than $2.8 billion beginning in 2027, above the $2.5 billion we previously in South Carolina, policymakers are in session and continue to evaluate potential energy legislation. We're appreciative of the significant time spent to date by the legislature on this important topic. As we've indicated in the past, we're committed to supporting South Carolina's growing economy. However, as we've testified, the regulatory framework for DESC creates regulatory lag that makes it practically impossible to earn our lab return, especially as compared to neighboring southeastern regulated jurisdictions, including on Millstone. The facility provides over 90% of Connecticut's carbon-free electricity and 55% of its output is under a fixed price contract through late 2029. The remaining output continues to be significantly derisked by our hedging program, which we've updated in the appendix of today's materials. During 2024, Millstone performed well and achieved a capacity factor of 92%, aligning with our expectations of exemplary performance and reflecting our unwavering commitment to safety and best-in-class many of you are aware, there's been recent legislative activity in New England and in Massachusetts specifically, aimed authorizing future additional procurements of nuclear power, and we've continued to engage with multiple parties there to find the best value for addition to state sponsor procurement, we continue to evaluate the prospect of supporting incremental data center activity as well. We feel strongly that any data center option needs to be pursued in a collaborative fashion with stakeholders in Connecticut. At this point, we don't have a time line for potential announcements. We remain focused, and we'll continue to provide updates as things that, let me summarize our remarks on slide 20. We achieved near-record setting safety performance this year. We reaffirmed our long-term operating earnings per share growth rate, credit, and dividend guidance for March 1, and narrowed our 2025 operating earnings guidance remains on schedule with robust cost sharing that protects customers and shareholders. In collaboration with our policymakers, regulators and stakeholders, we continue to make the necessary investments to provide the reliable, affordable, and increasingly clean energy that powers our customers every day. And we're 100% focused on execution. We know we must continue to deliver, and we that, we're ready to take your questions. Operator (Operator Instructions)Shar Pourreza, Guggenheim Partners. Shar Pourreza Hey guys, good morning. Just on CVOW, just I guess in light of the updates earlier this month, maybe can you just elaborate on the remaining variability in the projects, if there were delays in supplier component deliveries, how flexible the schedule, how would the standby cost be recovered with suppliers any new color on how you're thinking about incremental wind projects in light of your experience on CVOW one to date and the prospects for policy and tariff headwinds from DC. Robert Blue Yeah, Shar, you've got a lot in there, all in one question. So let me see if I can work my way through the various pieces. And I'll ask Diane to talk a little bit about where we are on the project and derisking. So we're in a very good position with this project, and we feel very confident about the estimates that we just there's more data to come from PJM on network upgrades, but we've done a lot of work with the best data that we can. So far, the data that we've used seems to be consistent with what PJM is looking at. And we think it puts us in a pretty good me talk a little bit about tariffs because you mentioned that, and then I'll turn it over to Diane to just talk about overall derisking on the project. It's really too early to say how potential tariffs might affect this project. I can tell you that remaining spend outside of the United States is about $2.5 billion, majority of that from Europe. Only a portion of that for components that would include steel or respect to potential steel and aluminum tariffs, in particular, generally, these types of tariffs are not intended to apply to most finished products. We would consider the CVOW components to be finished products. That said, we don't have the annexes to accompany the executive order. We can't know what if any of our remaining spend would be potentially subject to are finished products that include some steel, some other materials. So it's not as simple as just taking a contract value and applying a percentage. For example, the cells have thousands of components in the blades. As most people know, don't have steel or aluminum in the steel and aluminum tariffs end up taking effect, it won't be before March 12, so we should get some better insight before then the past may not be a predictor of the future, but if these tariffs follow the form of those imposed in 2018, they largely wouldn't apply to CVOW at then finally, and Diane will talk about how we're doing on derisking the project, but it's worth remembering we have $200 million of contingency within the current project budget of $10.7 billion. Up to $11.3 billion, 50% of costs are recoverable from customers and costs are shared 50-50 with Stonepeak. Diane, you want to talk a little bit about where we are in the development? Diane Leopold Sure. Shar. So when I think about the risk, first, I look at where we are, all of our permits are in hand, all of the materials have been purchased. We have fixed-price contracts for all the major equipment. Fabrication is going very well. All the deliveries of that fabricated equipment is right on time, and the installation activities have been moving forward on when I look at the performance of the suppliers, as we're progressing now that we're 50% complete, risks are naturally continuing to decrease. So just take as an example, [Demeg] with the vessel and installation logistics as we saw in the first piling season, we got better and better and got to 25 monopiles a month as a run as we've seen this winter, the transition piece installation and the cable installation is just going right on track. So when I look at what costs are still unfixed, we've talked about the final estimate that we're feeling good about on PJM. There's fuel for all the vessels and there's project management. So we need to complete fabrication, that's going very well. We need normal weather. And so we're feeling really comfortable where we are and where the suppliers have been performing. Robert Blue Shar, I'll jump back in. You also mentioned future projects. I don't think it will come as a surprise to you that we are very focused on this project and bringing it in consistent with the schedule and budget that we've been talking about. We've got a couple of other leases. We have no capital in the plan associated with those leases and we'll just see where things go in the future. But our focus is on this we get all the pieces and parts you had in there, Shar, or is there anything we missed? Shar Pourreza No, that was fantastic. I'll actually -- I'll leave it at that with my two-part question. I appreciate it, guys. Thank you. Operator Nicholas Campanella, Barclays. Nicholas Campanella Hey, thanks for taking my questions. Good morning. So I just -- the updated gigawatts on the data center side is just a really large number. And I'm just curious -- I just want to first confirm, this is incremental to what PJM has put out here in the beginning of the then secondly, just -- how do you think about the time line to wrap some of that into the plan in the current decade? And is there like a sensitivity we should be thinking about for every gigawatt of new data center hook up? Is there an amount whether it's transmission or generation that would be required for that? Robert Blue Yeah. Nick, on sort of is that in PJM, those gigawatts that are in the substation engineering phase. Those are not in the PJM forecast. There is no rule of thumb on any particular amount of gigawatts and the capital plan and so forth. I think it's just important for everyone to understand that the data center demand in Virginia, in Northern Virginia and in Loudon County continues to be very significant. You see that in the numbers to give you a sense, I know there are some folks who may have some misunderstanding about Loudoun in particular, about how much more capacity is available there. If you just look at the transmission projects that we're working on, including the two 500 KV lines that we mentioned in our prepared remarks, that's an additional 6 gigawatts of capacity in Eastern Loudoun there's room in Eastern Loudoun on the system, and the data centers continue to expand as well outward from Loudon County, particularly into neighboring counties coming down Interstate also data center expansion happening in the Richmond Metro area pretty substantially. So that demand just keeps coming. We're very focused on making sure we can serve it and we want to do that in a way that's consistent with our mission of reliable, affordable, increasingly clean energy. Nicholas Campanella I appreciate that. And then just kind of expanding on your comments from Millstone and the prospects for any type of incremental large customer for that remaining nonfixed portion? There seems to be a lot of focus on additionality if it comes with colocation in any form. And just maybe you can comment on whether that's something that you think you would need to move forward with the contract opportunity there?Or what's the next catalyst we should be watching for to know that this is potentially going in the right direction? Thanks. Robert Blue I can't give you a catalyst for what you should be looking for. As we've said, there's not a time line on this. From the potential large user customers we've talked to, additionality is not essential. They certainly talk about it, but they don't -- that's not a gating item -- so we're going to keep talking to potential data center co-locator customers to the states of Massachusetts and Connecticut, others in New we're going to continue to stick with what we said pretty clearly is we need to make sure we're taking into account the interests of stakeholders in Connecticut as we think about this very valuable asset. Operator Jeremy Tonet, JPMorgan. Jeremy Tonet Hi, good morning. I just wanted to dive into the Virginia data center opportunity a little bit more in quite the step-up as you outlined there. Just wondering if you could touch a bit more on reactions from stakeholders and really just thinking about this low driving incremental build pressure and thoughts about, I guess, bill headroom in general here. Robert Blue Yeah. Great question, Jeremy. Policymakers in Virginia are very focused on data center build out because they see the economic benefits of it. And you can see it in localities where there already is a substantial amount of data center load. The tax bills, property tax bills and say, Loudon County are substantially lower than they would have to be without the tax revenue that's coming in from data so that part of the economy and making Virginia a tech hub is really important to stakeholders in Virginia, particularly to Governor (technical difficulty) he talks about that quite a bit. So there is an interest in continuing to see data center there are more megawatt hours sold to data centers, then that spreads the total costs out over a larger group of customers and can actually help with customer bill headroom. And I know there's often a discussion about our data centers paying their fair share, our other customer classes subsidizing data centers. These debates about one customer class subsidizing another customer class have been going on since the beginning of utility are ways always to address that in Virginia, particularly with biennial reviews. So I suspect that in the biennial that we'll file in March that this issue will be considered by the commission. And I'm confident that they'll make a decision that ensures we can continue data center growth in Virginia in a way that works for all customers of Virginia. This is just good for the economy of Virginia, and it's important to keep it going. Jeremy Tonet Got it. That's helpful there. And I want to continue with the biannual, if we could. Just wondering on overall engagement with stakeholders there and besides affordability as you outlined there, any key issues to hash out here? Just trying to think about how we should be thinking about Virginia regulatory sausage making at this point? Robert Blue We're going to focus on just filing a pretty straightforward rate case in Virginia. As I expect many people know, in the last biennial, there were prescribed ROE. That is not the case in this one. We've got a couple of new judges on the SCC, relatively new. They're a little less than a year, they've been on the bench. But -- when we think about our positioning in a rate case, we start with our reliability and our affordability, and they're both incredibly strong in are well recognized among stakeholders as being a very reliable provider of electricity. And our rates, as we mentioned in our prepared remarks, continue to be below regional and national averages. So we're in a strong position. The general environment going into the case, I think, is very constructive and we'll have a result by the end of November. But I would not -- there's nothing particularly exotic in this upcoming biennial. Jeremy Tonet Got it. Makes sense. Thank you for that. Operator David Arcaro, Morgan Stanley. David Arcaro Thanks. Good morning. Steven Ridge Good morning, David. David Arcaro Let me see. I had a question on the offshore wind side of things. With the earlier this year, the executive order around offshore wind and the Secretary of the Interior reviewing existing projects. I was just wondering your interpretation and a few points on what that could mean for existing leases like CVOW? Robert Blue Yeah, we don't think there's going to be impact to CVOW from the executive order. If you think about it, it's got all the permits it needs, including all of its federal permits. It's consistent with some very important energy objectives that the administration has articulated. It's an important part of an all-of-the-above strategy to deliver more power to a growing economy in certainly the fastest and most economical way to deliver 2.6 gigawatts to the grid stopping it would be the most inflationary action that could be taken with respect to Energy in Virginia. It's homegrown. It helps promote American energy dominance. It's needed to power that growing data center market we've been talking about critical to continuing US superiority in AI and creating American Jobs -- 2,000 at last count. It's specifically authorized by Virginia law. It has robust bipartisan support of leaders in Virginia. Worth noting that in his confirmation hearing, Secretary Bergum, said projects that make sense and are already in law will continue and CVOW definitely fits that bill. David Arcaro Okay. Excellent. I appreciate that commentary. And then I was also curious on the data center side of things, just to dig in a little bit more -- obviously, your pipeline has grown a huge amount over the last six months. And then when we look at the PJM forecast for the 2034 forecast, they've only gone up a little bit. Do those numbers have to rise from here?Or are there constraints in actually connecting all of these data centers or something else that's making you think that not all of these are actually going to crystallize and come to your system? Robert Blue Well, I think if you look at what we're planning for, what we've got capital for, we're highly confident that the data centers are going to show up in our system. I mean if you think about it, we've been serving data center customers longer than anybody else. We understand better than other companies, I believe, the way they build, the way they ramp up and we understand extremely well a confidence level in their the new batch system may have had some effect on the number of customers who have jumped into that substation engineering letters of authorization group. But the bottom line is, there is a lot of growth coming in data centers in Virginia, and we're building the infrastructure in order to serve them. Steven Ridge David, I'd just add -- back on slide 17, where you see that PGM forecast 2034, summer peak of 41.5%. We would suggest that the increase we've seen in our Q is not fully reflected in that PJM update that it's a little bit backward looking. And to Bob's point, and to your question, will all of the amount that we're seeing in that first phase, ultimately convert. We don't know for sure. Many of them do in the past. And as we've moved further from down the column, we've seen increasing conversion rates up to 100% from the second to the third again, I think it's a sign, a bullish sign. Will all of it ultimately convert? We don't know. We think a lot of it will, and that to us is a bullish sign of the ability to continue to invest across the value chain, in support of those customers in a low-risk regulated environment. David Arcaro Got it. Okay, great. Yeah. Thanks, very much. Appreciate it. Operator Anthony Crowdell, Mizuho. Anthony Crowdell Hey, good morning. Just super quick one question following David. When I look at the column on page 18, is there just a rule of thumb of how long it takes a project to transition from one category to next as it works itself down the chain? Steven Ridge Well, we gave some updated guidance to our customers. As you recall, we've talked about, which was moving from a cereal to more of a cluster or a batch approach. And when we did that, we gave indications that from the time you started the process to the potential time where you're signing the ESA and taking delivery of power that, that period would be extended by somewhere between 12 and 36 months, which puts us at speed to market of between 4 to 7 years.26 gigawatts, that's all in very different phases and probably time lines, don't have specific guidance for you as to how to translate the 26 into the CLOA box or the ESA box. But again, from the very beginning of the process typically to the very end of the process, think of four to seven years. With this much demand, could that possibly pressure that? It's all going to sort of depend on where the specific project wants to be cited and where we have existing delivery not real -- I don't have a real specific guidance for you anything. I apologize, but it's all pretty bespoke depending on where the need is. Anthony Crowdell No, that's perfect. And thanks so much for the update. I appreciate it. Thank you. Steven Ridge You bet. Thanks. Operator David Paz, Wolfe. David Paz Hey, good morning. Thanks for the time. Just quickly on your assumption for earned returns in your outlook. Are you projecting any lag over the period? And maybe how much lag. If you can break it down by Virginia and South Carolina, that would be great. Steven Ridge Yeah, David, we haven't given that specific level of guidance as we go into periodic rate cases and we engage with stakeholders. But I think what we've said in the past has been that at DEV, in particular, where we've got a fairly significant amount of investment in riders, which generally earn at they're see pretty good ability to achieve allowed returns in 2023, our annual information filing, if you adjust for a handful of items, whether some amortization of fossil retirements that we needed to take, we are hitting on the base side of the business at pretty close to our allowed and expect that to then in South Carolina, I think what we've indicated in testimony is that under the existing rate case process that by the time new rates go into effect, given its backward-looking nature, we could be anywhere between 80 and 90 basis points, it is under earning immediately when rates go into effect. And we've quantified, I think, 100 to 200 basis points on average of under earning during the rate case as Bob mentioned in his prepared remarks, we've made that a point of focus. And in our discussions with stakeholders in South Carolina. And our excitement about supporting the needs of the growth needs for growth in the state but also a discussion about the ability for us to earn a return that's closer to our obviously, there's work being done on that now. We have tried to be appropriately conservative in our assumptions in the plan as it relates to both where the allowed are set as well as where the earned are set. -- we certainly have assumed that we have the ability to do somewhat better than what we've done in the past through some mechanism, whether it's legislation or the potential for more frequent rate cases in South I'd rather not get into the specific assumption we've made. I think we'll try to be reasonably conservative, but appropriately so. David Paz Okay. No, that makes sense. And just maybe quickly, the $4 billion-plus of new CapEx. Does any of that include any incremental spend on your interest in Summer? Do you agree? Steven Ridge No, it doesn't. We've indicated that we're not participating or interested in that project. And I think you meant -- I think you referred to $7 billion total capital increase. But yeah, none of that's related to VC Summer. Operator This concludes our question-and-answer session. So I'll turn it back to Bob Blue for closing remarks. Robert Blue Thanks, everyone, for taking the time to join the call today, and enjoy the rest of your day. Operator The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.
