The paragraph is the introduction to Evergy, Inc.'s Third Quarter 2024 Earnings Conference Call. It includes a brief overview of the event, with Peter Flynn, Director of Investor Relations, introducing the call and mentioning the availability of webcast slides and financial information on their website. The discussion will contain forward-looking information and non-GAAP financial measures. Key participants include David Campbell, CEO, and Bryan Buckler, CFO, who will discuss the quarter's highlights, updates on generation plans, regulatory and legislative agendas, financial outlook, results, retail sales trends, and long-term guidance. David Campbell then reports that the third quarter adjusted earnings were $2.02 per share, up from $1.88 the previous year, due to demand growth, new sales, and FERC investments, with some offset by cooler weather and increased expenses. Year-to-date earnings increased from $3.27 to $3.46 per share.

The paragraph discusses Evergy's financial guidance and leadership changes. The company reaffirms its 2024 adjusted EPS guidance of $3.73 to $3.93 per share and introduces a 2025 range of $3.92 to $4.12 per share. Bryan, the new Chief Financial Officer as of October 1, brings significant experience, promising strong leadership for the finance team. Evergy also announces a long-term growth target of 4% to 6% through 2029 and a 4% increase in its quarterly dividend. The paragraph then introduces new generation investments in Kansas and Missouri, aligning with their goal of cost-effective and resilient planning for future economic opportunities.

The company is pursuing a balanced energy strategy by investing in new technologies and renewable resources while maintaining affordability and reliability. They plan to build two combined cycle natural gas plants in Kansas, creating over 1,000 construction jobs and generating tax revenue, with construction beginning in 2026 and 2027, pending regulatory approval. Additionally, investments in three solar farms totaling 325 megawatts are planned, marking their first utility-scale solar projects in Kansas and Missouri, expected to be operational by 2027.

The paragraph discusses Evergy's recent filings and future plans related to energy projects and investments. The company has filed for certificates and predeterminations for projects in Missouri and Kansas, respectively, aimed at advancing its energy transition. Evergy has extended its capital expenditure forecast through 2029, planning to invest approximately $16.2 billion from 2025 to 2029, which is $3.7 billion more than the previous forecast. This includes significant investments in generation and distribution to support growth and improve reliability. The investment plan is expected to result in an 8% annualized rate base growth. The company intends to finance this growth through a balanced mix of debt, equity, and internally generated cash flow while maintaining a strong credit rating. The revised forecast incorporates Integrated Resource Plans focusing on cost-effective and reliable service with fuel diversification.

The paragraph discusses the company's 5-year capital plan primarily focused on transmission, distribution projects, and strategic objectives that include affordability, reliability, and sustainability. It outlines an updated EPS growth outlook of 4% to 6% from the 2025 guidance midpoint, driven by a $16.2 billion capital plan to accommodate expected load growth. Additionally, regular rate case filings are anticipated every 18 months. The paragraph also mentions a unanimous settlement in a Missouri West rate case that includes a net revenue increase and cost reductions, along with integrating their share of the Dogwood Energy Center for cost-effective generation. There are still unresolved issues related to the fuel adjustment clause sharing mechanism.

The paragraph discusses the company's support for maintaining a 95% and 5% sharing split in Missouri, citing past decisions and the state's supportive environment for infrastructure investment. It mentions the expected commission order in December and new rates effective by January 1, 2025. In Kansas, House Bill 2527, effective July 1, supports infrastructure investment for economic development. The company plans capital investments in gas plants and distribution projects qualifying for CWIP and PISA treatments to reduce regulatory lag and support their credit profile. A capital structure and ROE workshop, scheduled for November 20 and stemming from stakeholder discussions, aims for a stable regulatory framework to attract investment. The planning for a Kansas Central rate case will begin, with filing expected in Q1 2025.

The paragraph discusses key aspects of a company's strategic initiatives and upcoming regulatory activities. It outlines a case request focused on recovering costs for distribution, customer, and technology infrastructure investments, and mentions working with regulators and stakeholders in Kansas. The company filed for predetermination regarding new natural gas plants and a solar farm, with a decision expected in summer 2025. Additionally, they anticipate a commission order for their Missouri West rate in December and expect resolution for CCN proceedings 7 to 9 months post-filing. The paragraph also highlights significant economic development successes with Google, Panasonic, and Meta, which could demand approximately 750 megawatts collectively. The development pipeline in Kansas and Missouri is strong, with potential projects totaling over 6 gigawatts. The company is negotiating with two new data centers, which could add 500-1,000 megawatts. Only announced projects are included in current capital investment and load growth forecasts, with timing announcements contingent on customer disclosures. The competitive environment for new projects is also noted.

The paragraph outlines a company's strategic focus on maintaining affordability and regional rate competitiveness to attract potential new customers in a 6 gigawatt project pipeline. With recent partnerships with companies like Panasonic, Meta, and Google, the company expects demand growth to extend through 2029. The strategy emphasizes investing in infrastructure and technology to meet customer demand while aligning long-term rate increases with inflation. The company aims to enhance grid reliability, customer service, and safety metrics to support substantial economic development in Kansas and Missouri.

The paragraph discusses Evergy's commitment to a sustainable energy transition through investments in hydrogen-enabled natural gas plants and solar farms for Kansas and Missouri customers. Bryan Buckler, a new team member, expresses enthusiasm for contributing to the company's growth. The third quarter of 2024 saw Evergy's adjusted earnings rise to $466 million or $2.02 per share, up from $432 million or $1.88 per share in the same period in 2023. The increase was primarily influenced by a cooler summer leading to decreased cooling demand, growth in weather-normalized demand, new retail rates in Kansas, and recovery from FERC-regulated investments.

The paragraph discusses financial updates and growth prospects for the company. It highlights a $0.03 EPS decrease due to higher depreciation and amortization from increased infrastructure investment, and a $0.07 EPS increase from tax items. Retail sales have risen 0.8% year-to-date, driven by residential and commercial usage growth, aided by Meta's new data center operations. A strong labor market in Missouri, Kansas, and Kansas City supports customer demand. Weather-normalized demand growth of 2-3% is expected through 2029, with potential upside from a 6 gigawatt customer pipeline, although not yet included in the forecast. The company plans a $16.2 billion capital investment from 2025 to 2029, partly financed by cash flow and issuing debt and equity, while maintaining a 15% FFO to debt ratio.

The company plans to issue common stock worth approximately $400 million in 2026 and 2027, with higher issuances in 2028 and 2029, aligning with increased capital investments. While no stock issuance is planned for 2025, the company remains flexible in funding strategies to balance growth and financial stability. For 2025, adjusted EPS guidance is set at $3.92 to $4.12 per share, driven by growth from the Meta data center and Panasonic EV battery plant, alongside new rates and investment recovery in Missouri and Kansas. However, these gains may be offset by depreciation and interest expenses. Beyond 2025, EPS growth is expected in the 4% to 6% range, supported by significant load growth from major clients and an 8% rate base CAGR through 2029, driven by the capital investment program.

The company plans to implement more frequent rate cases to maintain financial stability and prevent significant rate hikes, aiming for a balance of affordability, infrastructure strength, and economic development. They reaffirm their 2024 EPS guidance of $3.73 to $3.93 per share, and set their 2025 guidance at $3.92 to $4.12 per share, with a projected 5% growth from 2024. From a 2025 midpoint baseline of $4.02, they anticipate EPS growth in the top half of their 4% to 6% target range through 2029. Confident in the plan, they focus on operational and financial goals to ensure affordability, reliability, and sustainability. During a Q&A, Shahriar Pourreza from Guggenheim congratulates Bryan Buckler on his first earnings call and asks David Campbell about potential earnings sensitivity with expected large loads and if additional deals could push their growth beyond the upper end of the 4% to 6% range.

In the paragraph, the speaker expresses strong confidence in their current business plan, which includes three confirmed customers and potential for more. The speaker emphasizes the importance of a capital structure workshop scheduled for the 20th, which aims to foster dialogue on attracting capital and enhancing competitiveness in Kansas. The workshop is described as non-decisional, providing an opportunity for discussion outside of formal proceedings. They anticipate this dialogue will positively influence the Kansas rate case in the upcoming years, and are optimistic about the workshop's collaborative nature with staff presentations.

The paragraph discusses plans for a general rate case filing in Kansas Central in the first quarter of 2025, with new rates expected to take effect later that year. The focus of this rate case will be on reliability-focused investments, with no major new generation projects slated to come online in the immediate future. The intent is to maintain a regular cadence for rate cases to prevent sudden significant rate increases for customers. The discussion shifts to a question from Julien Dumoulin-Smith, who inquires about the potential impact of including a significant portion of the Integrated Resource Plan (IRP) and mentions the SPP's robust ITP. David Campbell responds by expressing confidence in the existing plans and emphasizes the importance of execution, noting a substantial portion of the IRP.

The paragraph discusses a company's future energy investments, highlighting a substantial solar initiative expected to come online in 2027 through a power purchase agreement (PPA), and the inclusion of combined cycle gas turbine (CCGT) and combustion turbine (CT) plants expected around 2031-2032. The company chose not to include these gas plants immediately in their plans due to conservatism and the need to account for regulatory clarity and incremental load. The solar project is likely to remain a PPA, while gas plant announcements received enthusiastic support from significant political leaders and local officials in Kansas.

The paragraph discusses investments in dispatchable generation within certain communities and how these investments align with a strategic plan. Julien Dumoulin-Smith and David Campbell discuss the acceleration of this plan, particularly with the inclusion of two gas plants expected to come online in 2031 and 2032, which will lead to increased capital investment and rate base growth. Campbell emphasizes a balanced mix of generation, affordability, reliability, and sustainability. Durgesh Chopra asks about the long-term growth rate, and Campbell confirms an expected growth range of 4% to 6% following 2025, aiming for the upper half, and a consistent execution of the plan.

The paragraph discusses the company's focus on achieving consistent growth year-over-year, despite potential variations due to jurisdictional dynamics and timing. The goal is to maintain a regular cadence of rate cases to ensure predictability for both investors and customers. Durgesh Chopra and Bryan Buckler discuss the company's 5-year plan, highlighting legislative support and rate filing cycles as factors that help manage regulatory lag. They emphasize the positive impact of PISA provisions in Kansas and Missouri, which aid in managing regulatory lag and maintaining good credit metrics during major investments.

The paragraph discusses the importance of maintaining a regular schedule for managing investment recoveries and regulatory processes over the next five years, particularly with a significant investment profile in mind. David Campbell highlights the advantages of the PISA framework in Missouri, which helps manage regulatory lag, and notes that Kansas has made progress with similar mechanisms. These frameworks allow for smoother and more predictable rate cases, benefiting both utilities and customers. Durgesh Chopra asks about potential improvements in regulatory lag management as they implement their five-year capital plan, to which Bryan Buckler responds affirmatively, suggesting a positive direction, though without providing specific quantification.

In the paragraph, the speaker discusses recent achievements and future growth prospects for the company. They mention significant accomplishments in 2024, including supportive legislation in Kansas, a constructive rate case settlement in Missouri, and a partnership with Google. The company's detailed planning indicates strong earnings growth starting in 2026 and increased rate base growth from 6% to 8%. The speaker expresses confidence in achieving a 4% to 6% growth rate through 2029 and mentions being conservative in messaging to ensure successful execution of plans. They note that regulatory challenges have diminished due to new laws. The speaker also responds to Michael Sullivan's question about how increased rate base growth translates to EPS growth, explaining that larger capital investments are expected in the later stages of their plan.

The paragraph discusses an integrated growth outlook with tailwinds expected to enhance profitability, particularly after 2025, with potential for significant upside in the later years. Michael Sullivan inquires about equity issuance and its impact on funding and capital expenditure (CapEx) increases. David Campbell clarifies that previous plans did not anticipate equity issuances before 2026, but with new investments, issuances will begin in 2027 and 2028. Bryan Buckler emphasizes a flexible and opportunistic approach to equity issuance, targeting a 15% funds from operations (FFO) to debt ratio.

In the paragraph, the discussion centers around the company's financial and operational plans for the coming years. It clarifies that there is no plan for a new common stock issuance in 2025 and provides insights into expected equity needs in 2026 and 2027 due to increased capital requirements. Despite a rate base increase of 2%, the company aims to maintain its growth within a 4% to 6% range, with a conservative outlook to ensure plan execution and delivery. Michael Sullivan seeks clarification on gas plant costs, and David Campbell acknowledges that costs have risen compared to previous estimates, aligning with trends seen in other utilities. He mentions an upcoming filing with updated numbers and expresses confidence in the progress, noting the importance of these developments for a balanced energy portfolio.

The paragraph is part of a discussion about capital expenditures and future energy projects. David Campbell explains that of the $3.7 billion in new capital expenditure, $2.4 billion is allocated for incremental generation, and $1.3 billion is for distribution projects to improve reliability and accommodate growth. Gas plants are included in the company's future capital expenditure plans up to 2030, but additional gas plants planned for 2031 and 2032, totaling about 1,000 megawatts, are not yet included. These are part of the long-term resource plan to address future needs, emphasizing a conservative approach.

The paragraph details a discussion between company representatives regarding the process and timeline for a project closely coordinated with regulators. They emphasize that major spending will occur after receiving a predetermination, with some preliminary steps taken with minimal risk. In response to a question from Ryan Levine at Citi, the conversation shifts to supply chain and customer engagement, noting that additional generation capacity may only be available post-2031. The focus is on meeting customer demands quickly, especially concerning transmission and availability, as the company and others face capacity constraints in the near term.

The paragraph discusses the company's plans for customer acquisition and financial strategy. The company believes it can meet customer needs by aligning with their timelines and ensuring sufficient capacity in generation, transmission, and distribution. The operator then moves to a question from Paul Patterson regarding the company's financing strategy for 2025. Bryan Buckler clarifies that there are no plans to issue common equity in 2025, although the company remains open to opportunities based on market conditions for 2026. Additionally, the company needs to address some holding company debt for 2024, with plans to issue either unsecured debt or junior subordinated notes. The interest costs from this issuance are already included in the company's 2025 earnings per share plan.

The paragraph details a discussion between Paul Patterson and David Campbell about ongoing commercial negotiations and future rate projections. Campbell expresses hope that these discussions, involving multiple parties, will conclude by the end of the year, although he acknowledges the complexity and lack of control over the timelines. He states the discussions are active, aiming for a resolution in the coming months. Regarding the 8% rate base growth through 2029, Campbell is highly confident that it aligns with inflation, emphasizing the importance of economic development and collaboration with regulators to support growth.

The paragraph discusses the company's efforts to maintain competitive regional rates by aligning them with inflation. David Campbell expresses hope for inflation to trend towards 2%, acknowledging the potential impact of economic factors like elections on inflation rates. The company's goal is to keep affordability as a priority while advancing rate competitiveness. There is also mention of recent announcements about gas plants, emphasizing regular operations without adopting new technologies like carbon capture or others, though the plants are mentioned to be hydrogen-ready.

In the paragraph, David Campbell clarifies that while the technologies discussed are modern and efficient, specifically advanced CCGT and CT technologies, they do not include carbon capture sequestration, which might be considered in the future. The technologies are proven and widely deployed. Paul Fremont asks about potential growth if certain negotiations succeed, and David Campbell expresses confidence in their current plan, indicating that additional agreements could enhance their position. The session concludes with no further questions, and Campbell thanks attendees for their interest in Evergy.

The call has ended, and the operator thanks participants for joining. The program is concluded, and participants can now disconnect.

This summary was generated with AI and may contain some inaccuracies.