Fortis Inc.

Welcome to the Fortis second quarter conference call and webcast. During the 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 one on their telephone keypad. 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 Amimo. Please go ahead, Ms. Amimo.

Thanks, Michelle, and good morning, everyone, and welcome to Fortis' second quarter 2022 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 second quarter 2022 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 another successful quarter underpinned by our investment in the energy infrastructure needed for the provision of safe and reliable energy service to our customers. For the first half of 2022, we invested $1.9 billion in our system, placing us on track to achieve our 2022 annual capital plan and supporting our second quarter adjusted earnings of 57 cents per common share. In today's economic environment, our utilities have been especially focused on maintaining customer affordability by proactively managing energy prices as well as other inflationary pressures through hedging programs, energy efficiency programs, and cost reduction initiatives. Today we released our 2022 sustainability report, highlighting the progress made to reduce our greenhouse gas emissions and link sustainability targets to executive compensation and the corporation's revolving credit facility. The report also includes comprehensive diversity data on employees across the Fortis group of companies, which will advance our DEI strategies and inform our objective setting. Overall, the report contains more than 35 new key performance indicators and is fully aligned with the applicable Sustainability Accounting Standards Board, or SASB, standards. During the quarter, we continued to make progress towards our greenhouse gas emissions reduction targets. In June, TEP retired San Juan Unit 1, removing another 170 megawatts of coal-fired generation from its portfolio, supporting their plan to fully exit coal by 2032. Earlier this month, FortisBC announced a pilot project to produce carbon-neutral hydrogen from natural gas through a partnership between FortisBC, Suncor Energy, and Hazer Group, utilizing a new carbon capture and utilization technology that provides a marketable solid carbon byproduct. The pilot is being funded by the partner companies and the provincial government's CleanBC Industry Fund. While still in the early stages, it is innovative technologies and partnerships like this that will be necessary to accelerate the transition to clean energy. In June, TP filed its general rate application with the Arizona Corporation Commission, seeking new retail rates effective September of 2023 based on a December 31st, 2021 test year. The application includes rate base of 3.6 billion U.S. dollars, representing an increase of 900 million U.S. dollars since the last rate case, largely driven by investments for renewable generation, such as the Oso Grande Wind Project and the Raptor Ridge Solar Facility. The application requests an allowed return on equity of 10.25% and an equity layer of 54%. TEP is proposing to modify an existing adjuster mechanism to include recovery of certain investments associated with TEP's clean energy transition. The new resource transition mechanism, or RTM, is intended to reduce regulatory lag between rate cases. In addition, TEP is requesting to eliminate both the demand side management and the renewable energy standard adjusters and recover those costs in base rates. The requested non-fuel increase associated with the rate application totals 159 million U.S. dollars. As the waterfall chart highlights, the recovery in investments and rate base make up the majority of the increase. TEP's progress in its clean energy transition plan delivers a net reduction offset to customer rates, in this case, due to the cost savings from the recent retirement of the San Juan coal facility. The impact of the proposal to eliminate the two adjusters reduces the total revenue increase to $136 million. Earlier this month, Commission staff filed a sufficiency letter indicating that TEP's rate application meets all the necessary filing requirements. A procedural schedule was also agreed to earlier this week, with staff and intervener direct testimony due in January of 2023. Today, we are reaffirming our $20 billion five-year capital plan through 2026. This highly executable and low-risk capital plan is expected to increase rate base by over $10 billion over the next five years, supporting an average annual rate base growth of approximately 6%. Earlier this week, the MISO Board approved the first tranche of projects associated with the Long Range Transmission Plan. These 18 projects, which span across the MISO Midwest subregion, have total investments of approximately $10 billion U.S., With six of the projects located in ITC's service territory, ITC estimates investments of approximately 1.4 to 1.8 billion U.S. dollars through 2030. This is up from the previous estimate of 1 to 1.5 billion U.S. dollars. Once ITC finalizes the timing of these investments, we will update our capital outlook accordingly. Next, development activities and commercial negotiations on the $1.7 billion Lake Erie Connector project were suspended earlier this week. This was driven by recent macroeconomic conditions that impacted our ability to secure a viable transmission service agreement within the required timeframe. We acknowledge the efforts by all parties to bring the project to this point. However, at this time, it is a prudent and appropriate action given the circumstances. This project has never been included in our five-year capital plan. With 48 years of consecutive dividend payment increases, we continue to target 6% average annual dividend growth guidance through 2025, underpinned by our five-year capital plan. Now I will turn the call over to Jocelyn for an update on our second quarter financial results.