Fortis Inc.

Ladies and gentlemen, thank you for standing by. My name is Deborah and I will be your conference operator today. Welcome to the Fortis Q1 2021 conference call and webcast. During this call, all participants will be in a listen only mode. There will be a question and answer session following the presentation. At that time, those with questions should press star followed by the one on your telephone. If at any time during the conference you need to reach an operator, please press star zero. At this time, I would like to turn the conference over to Stephanie Amemo. Please go ahead, Ms. Amemo.

Thanks, Deborah, and good morning, everyone. Welcome to Fortis' first quarter 2021 results conference call. I'm joined by David Hutchins, President and CEO, Jocelyn Perry, Executive VP and CFO, other members of the senior management team, as well as CEOs from certain subsidiaries. Before we begin today's call, I want to remind you that the discussion will include forward-looking information, which is subject to the cautionary statement contained in the supporting slideshow. Actual results can differ materially from the forecast projections included in the forward-looking information presented today. All non-GAAP financial measures referenced in our prepared remarks are reconciled to the related U.S. GAAP financial measures in our first quarter 2021 MD&A. Also, unless otherwise specified, all financial information referenced is in Canadian dollars. With that, I will turn the call over to David.

Thank you, and good morning, everyone. Today, we are pleased to report a strong first quarter. On the financial front, EPS growth was supported by our record capital investments made in 2020 and during the first quarter of this year. Higher earnings in Arizona also contributed to year-over-year earnings growth. On the operations front, our systems continued to perform well with our people focused on delivering safe and reliable service. As a good example of this, in Arizona, our gas and electric utilities maintained reliable service to our customers throughout winter storm Uri that affected so many other surrounding states. It serves as a reminder that planning for the long term and preserving adequate capacity is critical to the provision of energy service to our customers under an increasingly wide range of circumstances. On the ESG front, we continue to advance key initiatives. As you may have read in our circular, we have 10 current directors and two nominees up for election. Assuming all nominees are elected at our annual meeting tomorrow, the Fortis Board will have reached gender parity for the first time in our history. This is a significant milestone in our diversity and inclusion journey. We are also strengthening our compensation metrics with the addition of new ESG-related measures. The metrics are focused on carbon reduction and climate change, building on our corporate-wide target to reduce carbon emissions 75 percent by 2035. Additionally, we are happy to report that our credit ratings were affirmed by S&P in April, and our outlook was revised to stable from negative. And yesterday, DBRS Morningstar upgraded our credit rating from triple B high to A low. These positive developments underscore our financial strength. Lastly, in April, FERC issued a supplemental notice of proposed rulemaking on incentives. Effectively, FERC is proposing to eliminate the 50 basis point regional transmission organization, or RTO, ROE adder, for utilities that have been RTO members for more than three years. Not only were we surprised in the reversal of FERC's direction on the RTO ladder, but we are extremely disappointed given the important role RTOs play in facilitating a reliable, cost-effective, and resilient grid while enabling clean energy goals. Turning to slide five, through the first quarter, $900 million of capital was invested in our utilities to support resiliency, modernization, and cleaner energy projects. For 2021, our $3.8 billion capital plan remains on track. Higher forecasted capital expenditures are expected to offset a lower foreign exchange rate. Recently, we completed the Oso Grande wind project at Tucson Electric Power. The 250 megawatt project is the company's largest renewable energy resource, with enough power to energize nearly 100,000 homes. The project complements TEP's integrated resource plan, which calls to exit coal and add 2,400 megawatts of new wind and solar power and 1,400 megawatts of energy storage by 2035. And in Ontario, the Watanekinyap Transmission Power Project continues to progress. The 1,800-kilometer transmission project is the largest First Nations majority-owned infrastructure project in Canada's history. With this ownership structure, the project is a model for Indigenous communities across Canada. Fortis brings a 39% equity interest and its utility expertise as project manager to the partnership. At the end of the first quarter, 850 transmission towers have been installed, with approximately 1,100 workers on site, including First Nations members. The project is on track to be completed in 2023. By replacing diesel fuel generation with cleaner energy from the Ontario grid, the Watanekinyap project is estimated to reduce emissions by 6.6 million tons over a 40-year timeframe. Additionally, the project is expected to generate significant benefits for First Nations communities, including access to reliable energy supply and economic benefits from construction. We are very thankful for the partnership with First Nations communities as we work together to realize their vision while advancing the project during the pandemic. As slide 6 highlights, we expect to invest $19.6 billion in our systems through 2025. With nearly all of our capital supporting energy delivery and the transition to a cleaner energy future, we have a balanced, low-risk plan. Investments including renewable generation, such as wind, solar, and battery storage, interconnections of renewables, liquefied natural gas, and renewable natural gas continue to support our sustainability strategy. The capital plan is expected to increase rate-based by $10 billion, from $30.5 billion in 2020 to over $40 billion in 2025, supporting average annual rate-based growth of approximately 6% through 2025. Beyond the base capital plan, we are focused on incremental opportunities that expand and extend growth. First, at ITC, the Mid-Continent Independent System Operator, or MISO, has initiated a long-range transmission planning process. In March, MISO outlined conceptual maps identifying potential new transmission required to enable more renewable generation in the region. Specific details regarding the size and location of MISO long-range transmission projects remain unknown until the studies are completed. But as slide 7 highlights, ITC's assets are strategically located to interconnect the Midwest to cleaner energy resources. Also at ITC, the proposed Lake Erie connector transmission project continues to progress. In April, the Canada Infrastructure Bank announced that it will fund up to 40% of the project costs. ITC will own the transmission line and be responsible for all aspects of design, engineering, construction, operations, and maintenance. The project is expected to bring an estimated $100 million in annual savings to Ontario customers by connecting their grid to the PJM interconnection the largest electricity market in North America. Additionally, the project is expected to reduce greenhouse gases by up to 3 million tons per year. While the project is fully permitted and shovel-ready, it is not included in the current five-year plan as we continue to negotiate transmission service agreements. Once finalized, construction of the projects would take four years to complete. In Arizona, the team is working to advance its clean energy goals, which requires investments in the range of $4 to $6 billion to execute Tucson Electric Power's integrated resource plan. And in British Columbia, we continue to pursue further development of the Tilbury site, long-term contracted LNG opportunities, and additional investments required to attain FortisBC's target to reduce customer greenhouse gas emissions 30% by 2030. Lastly, the Biden administration recently released its proposed infrastructure plan calling for carbon-free power from the electricity sector by 2035. This could accelerate capital investments at our US utilities through transmission interconnections at ITC, clean generation and energy storage in Arizona, and electric vehicle infrastructure in the nine US states that we serve today. With a strong track record of increasing dividends for the past 47 consecutive years, Coupled with our low-risk growth strategy, we remain confident in our 6% average annual dividend growth guidance through 2025. Now I will turn the call over to Jocelyn for an update on our first quarter financial results.