NextEra Energy, Inc.

Good morning, and welcome to the NextEra Energy and NextEra Energy Partners fourth quarter and full year 2020 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the start key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Jessica Aldridge, Director of Investor Relations. Please go ahead.

Thank you, Jason. Good morning, everyone, and thank you for joining our fourth quarter and full year 2020 combined earnings conference call for Nextera Energy and Nextera Energy Partners. With me this morning are Jim Robo, Chairman and Chief Executive Officer of Nextera Energy, Rebecca Chiava, Executive Vice President and Chief Financial Officer of Nextera Energy, John Ketchum, President and Chief Executive Officer of Nextera Energy Resources, and Mark Hickson, Executive Vice President of NextEra Energy, all of whom are also officers of NextEra Energy Partners, as well as Eric Szilagyi, President and Chief Executive Officer of Florida Power & Light Company. Jim will provide some opening remarks and we'll then turn the call over to Rebecca for a review of our fourth quarter and full year results. Our executive team will then be available to answer your questions. We will be making forward-looking statements during this call based on current expectations and assumptions which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect or because of other factors discussed in today's earnings news release in the comments made during this conference call, in the risk factors section of the accompanying presentation, or in our latest reports and filings with the Securities and Exchange Commission, each of which can be found on our website, NextEraEnergy.com and NextEraEnergyPartners.com. We do not undertake any duty to update any forward-looking statements. Today's presentation also includes references to non-GAAP financial measures. You should refer to the information contained in the slides accompanying today's presentation for definitional information and reconciliations of historical non-GAAP measures to the closest GAAP financial measure. With that, I will turn the call over to Jim.

Thanks, Jessica, and good morning, everyone. 2020 was a terrific year for both NextEra Energy and NextEra Energy partners. NextEra Energy performance was strong both financially and operationally. We had an outstanding We had outstanding execution on our initiatives to continue to drive future growth across the company. Across all of our businesses, we successfully executed on the largest capital program in our history, deploying more than $14 billion in 2020 as we lead America's clean energy transformation. By successfully executing on our plans, NextEra Energy extended its long track record of delivering value for shareholders. with adjusted earnings per share of $2.31, up 10.5% from 2019. A key element of our value proposition at NextEra Energy is a culture focused on delivering outstanding results for our shareholders. Over the past 10 years, we've delivered compound annual growth and adjusted EPS of 8%, which is the highest among all top 10 power companies who have achieved, on average, compound annual growth of less than 3% over the same period. Amid this significant growth, the company has maintained one of the strongest balance sheets and credit positions in the industry. In 2020, we delivered a total shareholder return of approximately 30%, significantly outperforming both the S&P 500 and the S&P 500 Utilities Index, and continuing to outperform both indices in terms of total shareholder return on a one-year, three-year, five-year, seven-year, and ten-year basis. Over the past 15 years, we've outperformed all of the other companies in the S&P 500 Utilities Index and 86% of the companies in the S&P 500, while more than tripling the average total shareholder return of both indices. While we are proud of our long-term track record of creating shareholder value, we remain laser-focused on the future and on delivering our commitments. NextEra Energy remains well-positioned to capitalize on the disruptive forces reshaping our industry, which have expanded and accelerated over the past two years, even beyond what we had anticipated. The combination of low-cost renewables with low-cost storage in the form of batteries today and hydrogen in the longer term has substantially increased the total addressable market for next-door energy. We now believe that a substantial and economic decarbonization of the electricity, transportation, and industrial sectors is possible, which represents the potential investment opportunity of trillions of dollars in the coming decades. In the electricity sector, we expect that older and more inefficient generation will continue to be retired and replaced with cleaner and more affordable alternatives. In the transportation sector, we believe it will be increasingly economic to replace fossil fuel vehicles with vehicles powered by fuel cells and batteries charged with renewable energy. And in the industrial sector, gray hydrogen and other high-carbon feedstocks can be replaced with green hydrogen. We believe these trends have already been put into motion, driven by economics. In addition, we believe it is possible that the Biden administration, supported by a significant shift and public support towards taking action to address climate change may act to further accelerate these shifts through the extension of existing incentives as well as initiating other forms of policy support. Importantly, we believe that no company is better equipped to take advantage of these substantial and long-term trends than NextEra Energy. In fact, NextEra Energy is already proof that you can be clean, low-cost, and financially successful all at the same time. We are at the vanguard of building a sustainable energy era that is both clean and affordable. And we are driving hard to continue to be at the forefront of the disruption that is occurring within the energy sector and broader parts of the U.S. economy. We expect that the execution of our strategy will drive meaningful CO2 emissions reductions across the country. and will help advance NextEra Energy towards its goal of reducing its CO2 emissions rate by 67% by 2025 from a 2005 baseline, while simultaneously lowering generation costs for customers and maintaining best-in-class reliability. We expect the disruptive nature of renewables to be terrific for customers, terrific for the environment, and terrific for shareholders by helping to drive tremendous growth for this company over the next decade and beyond. FPL is already capitalizing on the disruption in our sector with continued focus on its grid and fleet modernization efforts. During 2020, FPL successfully executed on its strategic initiatives, including placing more than 1,100 megawatts of cost-effective solar in service on time and on budget in support of its ongoing capital plan. This solar expansion is part of FPL's Solar Together community solar program. in its groundbreaking 30 by 30 plan, which is one of the world's largest solar expansions and would result in roughly 10,000 megawatts of total solar capacity on FPL's system by 2030. Additionally, the 409 megawatt Manatee Energy Storage Center, which will be the world's largest integrated solar-powered battery system, is on track and on budget to be placed in service later this year as part of the approximately $1 billion that NextEra Energy is investing in battery storage projects in 2021. Smart capital investments such as these help FPL improve its already best in class customer value proposition, while also maintaining an emissions profile that is among the cleanest in the nation. FPL also had continued success with its cost saving initiatives, making even further reductions to its already best in class dollar per retail megawatt hour non-fuel O&M costs from 2019 to 2020. Through our unrelenting focus on cost savings and on making disciplined long-term investments for the benefit of our customers, FPL has been able to maintain typical customer bills that are the lowest in the nation when compared to the 20 largest investor-owned utilities in the country. In addition to low bills, FPL has continued to provide reliability that is by far the best in the state of Florida, achieving its best-ever reliability rate in 2020. FPL's investments to build a stronger, smarter energy grid have resulted in best-in-state reliability for the last 14 years in a row, as well as earning numerous national awards. In 2020, FPL was recognized for the fifth time in six years as being the most reliable electric utility in the nation. Let me now turn to Gulf Power. In the two years that it has been part of the NextEra Energy family, Gulf Power has realized an approximately 30% reduction in O&M costs, a 50% improvement in service reliability, a 93% improvement in safety, and a nearly 20% reduction in CO2 emissions. Gulf Power has grown regulatory capital employed at a 17% compound annual growth rate since 2018. and we are well on our way to achieving the objectives we laid out at our investor conference in 2019. In addition to the excellent operational execution that we delivered in 2020, we continued to progress our smart capital investment program that is expected to generate further customer benefits over the coming years. In the fourth quarter, we completed the plant-crisp coal to natural gas conversion. As a result, consistent with our commitment to remain a clean energy leader, we were able to complete the accelerated shutdown of the coal units at Plant Crist, which has now been renamed the Gulf Clean Energy Center. With the retirement of FPL's Indiantown cogeneration facility also occurring late last year, 2021 is the first time in nearly 70 years that there are no coal-powered power plants in Florida for either FPL or Gulf Power. Earlier this month, FPL filed a test year letter with the Florida Public Service Commission to initiate a rate proceeding for new rates beginning in January 2022. The four-year plan that we intend to propose is designed to provide continued longer-term cost certainty for customers while allowing FPL to continue investing in clean energy, storm-hardened infrastructure, and other innovative technologies that are the foundation of our communities. The stability of multi-year rate plans allows FPL to focus on efficiency in the business, which is critical to keeping customer bills low, while at the same time enabling FPL to maintain strong credit ratings and balance sheet, which allows for consistent access to the capital markets. We look forward to the opportunity to showcase our long-term track record of providing low bills, high reliability, and clean energy for Floridians and our plans to build an even more resilient and sustainable energy future for Florida in the coming years. Turning to energy resources, in 2020, we continued to advance our position as the leading developer and operator of wind, solar, and battery storage projects, commissioning approximately 5,750 megawatts of new projects, more than doubling the amount of total renewables commissioned versus the previous year. This was also a record year for renewables origination in energy resources. with the team adding a net nearly 7,000 megawatts to our backlog during the year. As a result of the team's origination success and alongside the backdrop of the terrific market outlook I just outlined at the beginning of my remarks, we now expect to construct approximately 23 to 30 gigawatts of new renewables in the 2021 to 2024 timeframe, which, if we are successful at the midpoint, would mean adding a portfolio of generation projects that is approximately one and a half times the size of Energy Resources' entire operating renewables portfolio as of year end 2019. Energy Resources' execution success is reflective of our ability to leverage our significant competitive advantages, including our best-in-class development skills, large pipeline of sites and interconnection queue positions, strong customer relationships, purchasing power, best-in-class construction expertise, resource assessment capabilities, cost-to-capital advantages, and world-class operations capability to capitalize on the ongoing energy transition that is occurring in the nation's generation fleet. We believe that we are in a terrific position to be able to capture a significant share of the market opportunities going forward, and what we continue to believe is the best renewables development environment we have ever seen. Along with the broader public shift towards calls for action to fight climate change, Over the past few years, there's been an increased focus on environmental, social, and governance, or ESG, on the part of many of our stakeholders. While we expect this trend to amplify demand among our traditional customers and in our core renewables business, we also believe that it is opening up significant new markets and business opportunities for energy resources. We anticipate our development program to be further enhanced by an ability to attract new, nontraditional customers, particularly in the commercial and industrial sector, as improving renewable economics are increasingly aligned with corporate objectives to procure energy from clean generation sources. In summary, I continue to remain as enthusiastic as ever about NextEra Energy's long-term growth prospects. In 2020, we extended our long track record of executing for the benefit of customers and shareholders and further developed our best-in-class organic growth prospects. Based on the strength and resiliency of our underlying businesses, I will be disappointed if we are not able to deliver financial results at or near the top end of our adjusted earnings per share expectation ranges in 2021, 2022, and 2023. while at the same time maintaining our strong credit ratings. We remain intensely focused on execution and continuing to drive shareholder value over the coming years. Let me now turn to NextEra Energy Partners, which delivered a total unit holder return of approximately 32% in 2020, further advancing its history of value creation since the IPO. NextEra Energy Partners is uniquely positioned to take advantage of the disruptive factors reshaping the energy industry and benefit from the enormous market opportunity in the coming decades for renewables. NextEra Energy Partners also had a terrific year of execution in 2020 and continued to deliver on its commitments. That history of execution is supported by NextEra Energy Partners' outstanding portfolio of clean energy assets, which was further diversified in 2020. During the year, NextEra Energy Partners acquired interests in approximately 1,100 megawatts of high-quality renewable energy assets, including the partnership's first battery storage project from Energy Resources. Additionally, during the year, NextEra Energy Partners successfully completed its first three organic growth prospects, including the repowering of 275 megawatts of wind power. For 2020, NextEra Energy Partners grew its LP distributions by 15% year-over-year and delivered 40% year-over-year cash available for distribution growth, highlighting the strength of its operating portfolio. With this strong year-over-year growth in cash available for distribution, NextEra Energy Partners achieved its distribution growth objectives while maintaining a trailing 12-month payout ratio in the high 60% range as of year-end 2020. In the fourth quarter, we published our first NextEra Energy Partners ESG report, highlighting its high-quality clean energy portfolio, visible opportunities for renewables growth, and ability to leverage the operational expertise of NextEra Energy Resources. The continued origination success at Energy Resources is expected to benefit NextEra Energy Partners in meeting its future growth objectives. that the combination of NextEra Energy Partners' clean energy portfolio, growth visibility, and flexibility to finance that growth offers LP unit holders a uniquely attractive investor value proposition. As with NextEra Energy, we remain intensely focused on continuing to execute and deliver that unit holder value over the coming years. Finally, I would like to take a moment to thank all of NextEra Energy's employees for their continued dedication, hard work, and focus during the extraordinary circumstances of the past year. Despite the significant disruption caused by the pandemic, and in the midst of the most active hurricane season in the Atlantic Basin on record, our employees' unwavering focus on our customers is what enabled yet another year of flawless execution in the business, while also delivering our best-ever safety results across the company. It is because of their commitment to excellence that we were able to deliver above and beyond our commitments in 2020 and why I remain as confident as ever in our ability to deliver on all our expectations moving forward. With that, I'll now turn the call over to Rebecca, who will review the 2020 results in more detail.