The paragraph introduces a conference call for Public Service Enterprise Group's (PSEG) fourth quarter and full year 2024 earnings results, held on February 25, 2025. The event is hosted by Rob, the operator, who explains the procedure for participants to ask questions. Carlotta Chan, a representative from PSEG, welcomes attendees and introduces Ralph LaRosa, Chair, President, and CEO, and Dan Cregg, Executive Vice President and CFO. The discussion will include financial results, forward-looking statements, and non-GAAP earnings. Relevant materials are available on PSEG's Investor Relations website. A 30-minute Q&A session will follow the presentations.

In the paragraph, PSEG reviews its strong financial performance for 2024, reporting a net income of $0.57 per share for Q4 and $3.54 for the year, with non-GAAP operating earnings at the top of the guidance range. This marks the 20th consecutive year of meeting or exceeding guidance. PSEG also highlights its achievements in strategic and regulatory objectives, including settling a balanced rate case for electric and gas, securing approval for a $2.9 billion investment in the Clean Energy Future Energy Efficiency II program, executing a $3.6 billion capital spending plan, and completing the installation of 2.2 million smart meters. Additionally, new deferral mechanisms for pension and storm costs were implemented to enhance financial predictability and stabilize customer rates.

The paragraph outlines PSE&G's recent financial and operational developments and future outlook. It highlights that new base rates implemented last October reflected an annual increase of 1% since 2018, and notes a gas commodity charge reduction for the winter of 2025, aiming to moderate increases in electric bills due to the BGS auction. The company was recognized for high customer satisfaction and reliability in 2024. For 2025, PSE&G forecasts a 9% increase in non-GAAP operating earnings, starting from a midpoint of $4 per share, and plans to invest $4 billion, focusing on regulated investments. The capital spending plan for 2025-2029 has been raised to between $22.5 and $26 billion.

The paragraph discusses PSE&G's increased investments to address customer demand, modernize infrastructure, and enhance energy efficiency. Over the next five years, PSE&G plans a significant capital spending program aimed at supporting a steady rate base growth of 6% to 7.5%, starting from approximately $34 billion, up 12% from 2023. There has been a notable rise in inquiries from large load and data center customers, growing from under 400 megawatts last year to 4,700 megawatts this year. PSE&G can integrate many new projects within its existing infrastructure. About 25% of these new business leads are included in PJM's 2025 load forecast. Additionally, residential bills will increase from June 1 due to higher capacity prices from PJM's latest auctions addressing rising energy demand. Despite the increase, PSE&G's overall rates remain competitive in New Jersey and nationwide.

The paragraph discusses PSE&G's efforts to keep bills affordable for medium and low-income customers, highlighting growth opportunities in the nuclear sector to support their long-term growth outlook. PSEG is executing its business plan effectively, contributing to predictable performance and robust earnings growth. It emphasizes maintaining financial strength and operational excellence while executing a significant five-year capital program without needing new equity or asset sales until 2029. PSEG has announced a $0.12 increase in its annual dividend per share for 2025, marking the 14th consecutive annual increase, thanks to strong financial discipline. The paragraph concludes by transitioning to Dan Cregg to discuss the quarterly results and future outlook.

In 2024, PSEG's net income per share decreased to $3.54 from $5.13 in 2023, while non-GAAP operating earnings slightly increased to $3.68 per share from $3.48. For the fourth quarter, net income declined to $0.57 per share from $1.10, but non-GAAP operating earnings rose to $0.84 from $0.54. PSE&G's fourth quarter net income was $0.75 per share, up from $0.58 in 2023, driven by new electric and gas distribution rates effective from October 15, and seasonality in gas revenues. The new rates are expected to benefit 2025 earnings with a full year's impact. Transmission and distribution margins increased, and O&M expenses were slightly favorable compared to the previous year.

In the fourth quarter of 2024, PSE&G experienced a slight increase in depreciation and interest expenses, resulting from heightened investment and higher interest rates, which affected earnings by a few cents per share. The cessation of OPEB-related credits also contributed to lower income compared to the previous year. Despite these expenses, favorable tax timing had a positive effect on the quarter's earnings. For the year, increased earnings resulted from further infrastructure investment and energy efficiency improvements, although higher interest and depreciation expenses offset some of these gains. Weather fluctuations had minimal impact on utility margins due to the conservation incentive program, which focuses on customer numbers rather than sales volumes. Both electric and gas customer segments grew by about 1% in 2024. PSE&G's capital spending reached $3.6 billion for the year, surpassing its initial plans, driven by continued efforts in reliability programs and infrastructure upgrades.

The paragraph outlines PSEG's investment plans and financial performance forecasts. The company plans to invest around $3.8 billion in regulated capital for infrastructure and electrification in 2025, with a five-year investment plan of $21 billion to $24 billion through 2029, an increase from $18 billion to $21 billion. This investment is expected to result in a compound annual growth rate of 6% to 7.5% in the rate base, starting from $34 billion in 2024. The paragraph also details financial figures for the fourth quarter of 2024, reporting a net loss compared to net income in Q4 2023 but a slight improvement in non-GAAP operating earnings. The increase in net energy margin is attributed to higher recontracting prices at nuclear. Additional factors affecting the quarterly results include higher interest expenses and a decline in pension income, but taxes and other costs were slightly favorable.

The paragraph discusses PSEG's operational and financial performance, highlighting that their nuclear fleet achieved high capacity factors and produced significant terawatt-hours of energy in the past year. By the end of December, PSEG had $2.6 billion in liquidity, aided by strong cash flow and collateral returns. The company repaid $250 million in medium-term notes and secured a $400 million variable rate loan. Additionally, PSEG extended a $1.25 billion loan's maturity to June 2025. At the end of 2024, PSEG had $1.65 billion in outstanding debt, with most at a fixed rate to mitigate interest fluctuations. The company plans to fund its five-year capital expenditure plan without needing new equity or asset sales, while maintaining sustainable dividends. Future earnings in 2025 are expected to be driven by new distribution base rates.

The paragraph discusses financial projections and operational updates for PSEG in 2025. The fourth quarter of 2024 marks a peak in gas seasonality and impacts new base rates, similar to electric seasonality effects in the third quarter. Positive factors for the 2025 utility margin include clause-based recoveries from programs like GSMP, IAP, and CEF-EE II. Offsetting these are increased operating, interest, and depreciation expenses due to higher investment in PSE&G and refinancing costs. PSEG Nuclear has a scheduled refueling for the Hope Creek unit in fall 2025, also planning a fuel cycle extension. Zero-emission certificates for New Jersey nuclear units end in May 2025. The company expects 2025 non-GAAP operating earnings to increase by approximately 9% over 2024, with an expanded growth target through 2029. Ongoing efforts to pursue additional revenue opportunities at PSEG Nuclear could enhance growth further. The paragraph concludes by opening the floor to a Q&A session for financial analysts.

The paragraph discusses a conversation during a call where Shar Pourreza from Guggenheim Partners asks about potential delays in commercial discussions regarding the nuclear sector at Artificial Island due to recent FERC actions. Ralph LaRosa and Dan Cregg respond by mentioning the New Jersey governor's interest in exploring alternative uses for the wind port, highlighting ongoing interest and discussions with multiple parties. They imply that the state is keen on pursuing related opportunities and address potential timing issues.

The conversation involves Ralph LaRosa discussing feedback from the Federal Energy Regulatory Commission (FERC) on nuclear energy policy, which although not fully detailed, seems positive and favorable for future flexibility. There's mention of deferred charges and a strategic approach towards resolving issues, perceived as a positive move by FERC. Ralph also mentions PSE&G's pipeline of opportunities, including over 4,700 megawatts of projects, which extends beyond data centers to include large loads and electric vehicle interconnections, particularly in New Jersey. There is a query from Shar Pourreza about whether these opportunities impact potential deals with Artificial Island, but the entities involved seem to be separate from the current PSE&G discussions.

The paragraph discusses ongoing discussions and changes in the PJM market, with a focus on the potential impacts of FERC's review of auction structures. Ralph LaRosa explains that they are setting targets based on the PTC floor and emphasizing efforts to keep customer costs down. He questions the validity of the PJM market's current structure and expresses concern about its ability to attract generation, particularly from a reliability standpoint. The conversation highlights challenges and strategic considerations related to the nuclear fleet and customer affordability.

The paragraph discusses concerns about resource adequacy and its importance for reliability and affordability in the energy market. Dan Cregg emphasizes the need to get resource adequacy right, noting that having a pricing floor offers some stability. He highlights that while lower prices offer a safeguard, higher prices could provide benefits. David Arcaro asks if market uncertainty is discouraging customer interest, particularly given proposed changes and challenges. Ralph LaRosa responds that, at least in New Jersey, interest has increased significantly, from 400 megawatts to 4,700 megawatts, indicating strong demand despite uncertainties.

During the earnings call, Nicholas Campanella from Barclays inquired about a potential commercial deal involving the nuclear fleet and whether it depends on state actions or the Federal Energy Regulatory Commission (FERC). Dan Cregg replied that they are not waiting on either the state or FERC, although details from FERC might provide some flexibility. Cregg mentioned urgency from FERC, which aids ongoing work, despite the lack of complete clarity. Campanella also questioned the impact of customer ramp-up timelines, particularly concerning data centers, on the company's five-year plan. Cregg acknowledged the time required for ramp-up but did not provide a definitive impact on the plan.

The paragraph involves a discussion between Nicholas Campanella and Dan Cregg about the impact of capacity auction prices on financial performance. Dan explains that the timing of financial benefits depends on existing infrastructure, like data centers, and future market conditions. He mentions that capacity prices are influenced by energy prices, with an inverse relationship typically observed between the two. Dan advises monitoring changes in energy prices to determine their potential impact on capacity prices and overall financial outcomes, emphasizing the importance of market stability and potential upside if market conditions improve.

In the paragraph, Ralph LaRosa emphasizes the importance of considering inflation adjustments in financial calculations. Paul Fremont asks about PSEG Power's hedging strategies, noting they used to hedge around 90% in previous years. Dan Cregg explains they strive to manage risks amidst uncertainties and have not drastically altered their hedging approach, staying close to past guidance levels. Paul Fremont also inquires about why PSEG no longer provides a detailed net income guidance breakdown. Ralph LaRosa responds that they decided a year or two ago to present guidance only at the enterprise level, and they are comfortable with this approach.

The paragraph involves a discussion during a call about utility and gross margin sensitivity in the context of capacity prices and auctions. Paul Fremont inquires if the sensitivity analysis includes the dollar per megawatt-hour equivalent of capacity auction costs. Dan Cregg confirms that it does, suggesting it represents an all-in price. Paul Patterson then shifts the topic to the timing of an order regarding colocation, asking for clarity on when it might be released, given the recent statements from a chairperson. Dan Cregg responds by affirming trust in the chair's statements that the order would be released "shortly thereafter" as they have consistently followed through on their commitments.

In the paragraph, Paul Patterson and Ralph LaRosa discuss the dynamics and future of the PJM market and its implications for states like New Jersey. LaRosa emphasizes that outcomes will depend on state-specific economic policies and mentions that New Jersey is at a crossroads regarding its energy strategy. He notes the importance of ensuring affordability and reliability for customers and hints at an upcoming master plan, though no definitive decisions or proposals are available yet.

The paragraph is a segment from a conference call involving several individuals discussing strategies and plans related to energy operations in New Jersey. An unnamed company representative highlights efforts to educate stakeholders about opportunities in the state that might span multiple administrations. Carly Davenport from Goldman Sachs asks about the GSMP III filing and its impact on the company’s future plans. Ralph LaRosa confirms that discussions have begun and the filing is included in the company's core business activities, suggesting it’s already considered in their future plans. Paul Zimbardo from Jefferies inquires about the company's financial planning, specifically no additional equity despite increased capital expenditure, and queries about the 2024 FFO to debt ratio and projected credit metrics. Dan Cregg is addressed but no response from him is included in the text.

In the paragraph, Paul Zimbardo and Ralph LaRosa discuss future financial guidance and concerns related to energy supply costs in New Jersey. While the company continues to aim for mid-teens growth, there are challenges with high energy costs, particularly in the commercial industrial sector, which reached nearly $700 per megawatt day. LaRosa points out that although their company's rates are lower than some areas in the state, there is still a need to enhance customer support through payment assistance and energy efficiency programs. The focus is on helping customers manage costs, especially those relying on Basic Generation Service (BGS). Dan Cregg acknowledges this approach.

The paragraph includes a discussion about a BGS (Basic Generation Service) contract, which acts as a pass-through from supply providers and doesn't generate profit for the involved party. The increase in costs is mainly attributed to auctions at PJM. There's interest in energy shopping, but providers will still face high prices from the last auction. Paul Zimbardo and Dan Cregg discuss that commercial and industrial dynamics are similar, with the ability to shop remaining. Anthony Crowdell questions the state of New Jersey's energy generation position, with Ralph LaRosa explaining that New Jersey lacks an integrated resource plan and reserve margin, indicating the state is a net importer, particularly on peak days.

The paragraph involves a discussion about resource adequacy and energy market strategies in PJM, with specific reference to New Jersey's energy planning. Dan Cregg highlights the state's position as a net importer, and Anthony Crowdell inquires about potential state strategies, including the possibility of adopting a Fixed Resource Requirement (FRR) like other states. Ralph LaRosa acknowledges that this is a possibility among various paths and emphasizes the importance of balancing affordability and reliability within the market. He references historical deregulation and the current reliance on PJM while noting the complexities of market influences. The conversation underlines the need for New Jersey to carefully navigate its energy strategy as it participates in the PJM market. Anthony expresses gratitude for the discussion, and the operator invites Mr. LaRosa to make closing comments.

The paragraph highlights the discussions around nuclear output and potential data centers while emphasizing the team's accomplishments in the previous year, 2024. It mentions the successful handling of the rate case, adverse weather conditions, and other challenges. The speaker expresses gratitude to PSEG employees for their consistent hard work and dedication. The paragraph ends with an invitation to future roadshows and a note that the teleconference has concluded.

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