Dominion Energy, Inc.

Welcome to the Dominion Energy Fourth Quarter 2020 Earnings Conference Call. At this time, each of your line is in a listen-only mode. At the conclusion of today's presentation, we will open the floor for questions. Instructions will be given for the procedure to follow if you would like to ask a question. I would now like to turn the call over to Stephen Rich, Vice President, Investor Relations.

Good morning, and thank you for joining today's call. Earnings materials, including today's prepared remarks, may contain forward-looking statements and estimates that are subject to various risks and uncertainties. Please refer to our SEC filing, including our most recent annual reports 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 expectations. This morning, we'll 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 kit. Joining today's call are Tom Farrell, Executive Chairman, Bob Blue, President and Chief Executive Officer, Jim Chapman, Executive Vice President and Chief Financial Officer, and other members of the executive management team. I will now turn the call over to Tom.

Thank you, Steve, and good morning, everyone. I want to start by outlining Dominion Energy's compelling shareholder return proposition. We expect to grow our earnings per share by 6.5% per year through at least 2025, supported by our updated $32 billion five-year capital growth plan. we offer an attractive dividend yield of approximately 3.5 percent, reflecting a target payout ratio of 65 percent and an expected long-term dividend per share growth rate of 6 percent. This resulting 10 percent total shareholder return proposition is combined with an industry-leading ESG profile characterized by what we believe is the largest regulated decarbonization investment opportunity in the country. We plan to invest tens of billions of dollars over the next several years to the benefit of the environment, our customers, our communities, and our local economies. Our strategy is anchored on a pure-play, state-regulated utility operating profile that centers around five premier states, as shown on slide five. All share the philosophy that a common-sense approach to energy policy and regulation puts a priority on safety, reliability, affordability, and increasingly, sustainability. These states also strive to create environments that promote sensible economic growth, which, like the rising tide, lifts all boats. For instance, three of these state jurisdictions rank consistently in the top four best states for business. as determined by independent analysis carried out by CNBC and by Forbes. Our state regulated utility model offers investors increased predictability and is enhanced by our concentration in these fast-growing, constructive, and business-friendly states. Turning to slide six. Dominion is a purpose-driven company and has adopted a comprehensive stakeholder approach. We are driven by the belief that the world's best companies consider the interest not just of investors, but also employees, customers, and communities, and the well-being of the environment. Our actions are grounded in adherence to our five core values, and we embrace transparency and stakeholder engagement as hallmarks of responsible corporate citizenship. The well-being of our over 17,000 employees is critical to our long-term success, and there is no measure more important to our company than the safety performance of our employees. 2020 represented by a wide margin the safest year of operations in the history of our company, as depicted on slide 7. This result did not happen overnight. As you can see, it takes years of dedicated effort to drive sustainable improvements, I congratulate my colleagues on this significant achievement. Turning now to our customers and communities. We believe that it is not enough that we provide energy safely. We must also provide energy that is affordable. We are pleased that residential rates at our two electric utilities compare favorably to state, national, and where applicable, Reggie state averages. Looking forward, we expect our customer rates to be very competitive even as we invest heavily to transform our system's carbon footprint. Bob will address this more comprehensively in his remarks. With regard to our community initiatives during 2020, which are described on slide 8, first, the impact of COVID-19 on our customers during 2020 was obviously significant, which is why we voluntarily took immediate action at the onset of the pandemic to suspend service disconnections. In doing this, we avoided what otherwise would have been disconnection of over 255,000 customer accounts. We also developed extended and flexible payment plans, resulting in over 330,000 enrollments. And we contributed $18 million toward direct energy assistance for our most vulnerable customers. In Virginia, we supported special session legislation, which gave customers a fresh start by forgiving over $125 million of customer arrears. We also agreed to a pause in our South Carolina rate case proceeding, ensuring that the result of that case will not impact customers until late this year. Second, we built on our longstanding legacy of supporting social equity by committing $25 million to 11 historically black colleges and universities, funding an additional $10 million for scholarships for underrepresented minority groups, and creating a $5 million social justice fund that supports community efforts to address the impacts of racism. This is in addition to the diversity and inclusion initiatives within our company that Bob will address. As you can tell, we are extremely proud of these accomplishments, and I thank all of my Dominion Energy colleagues who contributed to these successes in what was obviously an extraordinarily challenging year. Turning now to slide nine, we have rolled forward our five-year capital growth plan to capture the years 2021 through 2025. This has resulted in a $10 billion or 43% increase to the plan we shared with you in the spring of 2019 as adjusted for the gas transmission and storage sale. We now project $32 billion of growth capital investment on behalf of our customers over 80 percent of which reduces or enables emissions reductions. We plan to invest $17 billion in zero-carbon generation and energy storage, including regulated offshore wind, solar, and nuclear relicensing. Another $6 billion in electric grid enhancements, such as electric transmission and grid modernization, which will enable our system to be more resilient to cyber and climate threats, and more responsive to increasing intermittent generation. And we plan to invest $3 billion on the modernization of our LDC networks, as well as on renewable natural gas development, thereby increasing safety and reliability while driving emissions down. Jim and Bob will provide more color on these industry-leading investment programs in a moment. As meaningful as these near-term plans are, consider on slide 10 how they compare to the long-term scope and duration of our overall decarbonization opportunity. Our initiatives extend well beyond our five-year plan. We have identified over $70 billion of green investment opportunity between 2020 and 2035, nearly all of which will qualify for regulated cost of service recovery. This is, as far as we can tell, the largest regulated decarbonization investment opportunity in the industry. And the accelerating electrification of the transportation sector promises to drive growing demand for utility scale, zero and low carbon generation for many years to come. Companies' long-term transformation has multiple beneficiaries. Our customers who want more sustainable energy, our local communities, which benefit from the economic growth and tax revenue that accompanies investments, our employees who develop the best practices of the transition to a low-carbon future, and the environment via the emissions reductions we illustrate on slide 11. Through 2019, inclusive of asset divestitures, we have successfully reduced our enterprise-wide CO2 equivalent emissions by around 55 percent This is great progress, but we have more to do. By 2035, we expect to improve that reduction to between 70 and 80 percent versus baseline on our way to net zero by 2050. As shown on the right side of the slide, by 2035, we expect that approximately 95 percent of our company-owned generation will be either zero or low emitting, a remarkable transformation from our 2005 dispatch mix. Before turning it over to Jim, I will summarize the actions and events of 2020 that have positioned Dominion to thrive for years to come. We took care of one another, and in so doing, we achieved an all-time safety record. We took quick action to work with our customers to address the impact of the COVID-19 pandemic. We announced our ambition to be net zero by 2050. The Virginia Clean Economy Act was adopted by the General Assembly, which puts the state on a cutting edge path to decarbonization and positions the state as a hub for the global green economy transition. We advanced our strategic positioning by selling our gas transmission and storage assets to focus on our premier state regulated utility operations. We simultaneously initiated best in class earnings and dividend growth rates We reported our 20th consecutive quarter of weather normal results that met or exceeded the midpoint of our quarterly guidance. And we transitioned both our CEO and lead director roles. With that, I will turn it over to Jim.