NiSource Inc

Ladies and gentlemen, thank you for standing by. My name is Desiree and I will be your conference operator today. At this time, I would like to welcome everyone to Q2 2026 NYSource earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question again, press this star one. I would now like to turn the call over to Durgesh Chopra, Head of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to KnightSource's second quarter 2026 investor call. Joining me today are President and Chief Executive Officer Lloyd Yates, Executive Vice President and Chief Financial Officer Shawn Anderson, Executive Vice President of Technology, Customer, and Chief Commercial Officer Michael Luhrs, and Executive Vice President and Group President of NiceSource Utilities, Melody Birmingham. Today we'll review NiceSource's financial performance for the second quarter and share updates on operations, strategy and growth drivers. Following our prepared remarks, we'll open the line for your questions. Slides for today's call are available in the investor relations section of our website. Some statements made during this presentation will be forward-looking. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the statements. Information concerning such risks and uncertainties is included in the risk factors and MDA sections of our periodic SEC filings. Additionally, some statements made on this call relate to non-GAAP financial measures. Please refer to the supplemental slides segment information, and full financial schedules for information on the most directly comparable gap measure and a reconciliation of these measures. With that, I'll turn the call over to Lloyd.

Thank you, Durgesh, and good morning, everyone. I'll begin on slide three. At NYSource, our strategy remains grounded in delivering safe, reliable, and affordable energy while creating long-term value for our customers Communities and Shareholders. Discipline capital deployment, operational excellence, along with constructive regulatory and stakeholder relationships across our jurisdictions continue to support successful execution. Our value proposition is anchored in regulated utility operations across six states, providing diversification in both asset mix and regulatory environment. Our base business provides stability and flexibility, as we continue to modernize our electric and gas infrastructure. Our data center strategy as a differentiated growth platform, returning an expected $1.4 billion in savings to our customers over the lives of our data center contracts. Together, these businesses position Nisource to deliver on our commitment while supporting the significant energy needs emerging across our service territories. Turning to our key priorities on slide four, regulatory execution continues to advance our strategy and support the financial plan, as evidenced by rate case filings in Virginia and Kentucky, as well as several regulatory advances in our data center strategy, including IURC approvals of our data center agreements. At the same time, we continue to advance operational improvements through AI-enabled efficiency and continuous improvement initiatives. helping us work more effectively in strengthening execution across the business. Today, we reported second quarter consolidated adjusted EPS of $0.16, bringing our year-to-date consolidated adjusted EPS to $1.22. With strong visibility into second half performance, we remain firmly on track to deliver on our full-year commitments. Moving to operational excellence on slide five, safety remains our top priority and the foundation of how we serve our customers. This quarter, our teams responded safely and effectively to multiple severe weather events across our service territory. 2026 has been an unusually active year with a record number of tornadoes driving increased outages and system impacts. Our field teams, supported by operations and customer care, work around the clock to assess damage, restore service, and support impacted communities as quickly and safely as possible. This quarter reinforced why proactive investment in our systems and technology matters. We continue to harden our distribution systems to improve resiliency, while enabling employees to interact with enterprise data through AI-powered experiences that accelerate decision-making beyond traditional reports and dashboards. This system, our speech analytics and storm response solution, is another example of how Project Apollo leverages artificial intelligence, advanced analytics, and other technology-enabled tools to standardize work, improve visibility, and reduce waste. On slide six, we continue to make strong progress on our regulatory agenda. In Ohio, we received approval of key infrastructure and safety-related tracker mechanisms. And since our last call, we filed rate cases in Virginia and Kentucky to support timely recovery of critical investments that improve system safety and reliability. As we modernize our systems, we remain focused on managing the pace of investment and the resulting impact on customer bills. We expect decisions on both filings by the first half of 2027. At NIPSCO, we continue to invest in projects that strengthen system reliability and deliver customer value. We're reviewing the order issued today from the IURC regarding our continued gas modernization investments and safety and reliability, which informs our program going forward and the meaningful progress we have made modernizing Nipskill's natural gas system over the past decade. We remain confident in the investment thesis as Indiana offers multiple pathways to recover prudent investments through the FMCA and or base rate cases. Notably, the Commission recognized the need for continued investment and encouraged us to pursue recovery while demonstrating the specific benefits delivered by the individual projects. In June, we were issued a third federal order requiring the continued operation of the Shaper Coal Plant. We are pursuing recovery of the associated compliance costs through a FERC Section 205 filing and seeking approval within 60 days. As we navigate these federal directives, our plan remains flexible and focused on balance and reliability, customer impact, and our financial commitments. Recently, CNBC named its ranking for America's top states for business, which included several of the states we serve, led by Ohio at number one and two others in the top ten, Virginia and Indiana. This recognition underscores the strong economic development momentum we are seeing across our service territories, bringing new jobs and investment to the communities we serve. For example, in Virginia, two major aerospace and defense manufacturers have announced projects representing more than $1.7 billion of planned investment in over 1,300 new jobs. These projects highlight the importance of reliable natural gas infrastructure in supporting long-term growth in our communities. Turning to updates across our state operations, we believe Pennsylvania remains a constructive regulatory environment. We continue to proactively engage with all stakeholders, including the Governor's Office and the Commission, as we evaluate our investment plans and regulatory requirements. Our planned 2026 capital program is fully supported under the framework established in our most recent rate case, and as we move forward, we will continue to evaluate trackers and other recovery mechanisms to support future investment. Moving to Indiana, the recent approvals of our Amazon and Alphabet agreements reinforce the constructive regulatory support we continue to see for GENCO. Together, Our data center agreements support continued economic growth and investment in the state while providing substantial bill relief for existing customers. We are engaged in the affordability discussions underway while the Commission is evaluating a range of issues. We're encouraged by the collaborative and constructive nature of the discussion scheduled to begin on August 7th. We expect the process to remain balanced and focused on enhancing customer affordability through economic development greater bill transparency, and thoughtful, targeted refinements to the state's regulatory framework. Importantly, state leaders have acknowledged the significant customer savings delivered through our GenCo strategy and continue to recognize the role that economic development and investment recovery mechanisms play in supporting the reliable infrastructure our customers depend on. The diversity of our portfolio helps mitigate risk and preserve flexibility as jurisdiction-specific developments evolve. Affordability and customer outcomes remain central to the regulatory dialogue, and we believe economic development is an important part of the solution. We will continue to engage openly with our state commissions and other stakeholders as these efforts advance. We continue to identify opportunities to help manage customer costs through disciplined planning and constructive stakeholder engagement. In Indiana, the IURC's recent 2026 Residential Electric Bill Survey shows our customers' bills declining year over year, driven in part by our strategic investments in renewable generation and the associated cost efficiencies those resources provide. In Ohio, we are continuing to pursue avenues to reduce property taxes that create ongoing savings for customers. In addition, and approved economic development agreement for a peaking plant project in Jasper County, Indiana, is expected to lower property taxes by nearly 40% over the life of the investment, generating meaningful customer savings and supporting long-term affordability. These actions complement our broader affordability-focused efforts, including our Genco strategy. We remain focused on capturing the benefits of growing energy demand while protecting our existing customers, as shown on slide 7. Our agreements with Amazon and Alphabet are expected to provide approximately $1.4 billion of bill reductions for existing Nipsco Electric customers over the respective contract terms. For an average residential customer, that equates to up to $124 annually for roughly one month of an electric bill. We expect these benefits to begin flowing to customers as early as the fourth quarter of this year, and we see further opportunity for this to grow as we advance opportunities through our pipeline on slide eight. Demand from large low customers remains robust with three gigawatts in active strategic negotiations and line of sight to approximately two gigawatts of additional potential customers. We remain disciplined in pursuing opportunities that align with our customer's protections commercial requirements and return expectations as we look forward to providing updates as these discussions advance. We continue to see favorable market dynamics that could expand opportunities beyond our current nine gigawatt pipeline and are assessing execution pathways to advance and integrate that additional growth into our pipeline. Slide nine highlights the continued progress we are making to move our data center strategy from commercial agreements through regulatory approval and execution. In June, the IURC approved the original Amazon special contract, the related power purchase agreement, and the generation resource proposed to support the agreement. Parties also agreed to support expedited procedural schedules of 90 to 120 days for future agreements. This approval represents an important validation of the structure and establishes a foundation for advancing future data center agreements. On July 17th, we filed NIPSCO's request for approval of amendments to its existing Amazon data center electric service agreement and the associated PPA with Genco. Collectively, The amendments increase Amazon's contracted load by 400 megawatts, which we announced with our first quarter earnings and are already incorporated in our near and long-term guidance. We're seeking final order by November. We also continue to execute on our alphabet partnership, receiving IURC approval of the agreement in July. We are ready to energize this project, which is on track to occur this summer, with load expected to ramp to full capacity by 2030. We are encouraged by the progress we have made and remain focused on converting this momentum into disciplined execution. Our teams are advancing the regulatory, commercial, and operational work necessary to serve these customers successfully and deliver the benefits embedded in our agreements. With that, I'll turn the call over to Shawn.

Thanks, Lloyd. And good morning, everyone. Turning to slides 10 and 11, second quarter consolidated adjusted earnings per share was $0.16 compared with $0.22 of the same period last year. This brings our year-to-date consolidated adjusted earnings per share to $1.22, an increase of $0.03 versus the same period last year. Our year-over-year results reflect increased revenue from new rates and recovery mechanisms, including the continued benefit of rate implementation at NIPSCO Electric and Columbia Gas of Ohio and Pennsylvania. These benefits were offset by higher O&M, reflecting higher-than-usual storm activity and elevated expense to maintain workforce continuity during the ongoing union negotiations. These investments supported safe and reliable service and strengthened operational readiness across our business. Second quarter results typically exhibit a shorter quarter for our business and regulatory activity begins to phase in across the quarter and will strengthen as recovery mechanisms are implemented throughout the year. Based on first half results and our current run rate, the business remains on track Many of the principal drivers supporting our 2026 outlook are already in place, reinforcing our confidence in our full year guidance. We expect earnings growth to be more weighted toward the second half, supported by approved recovery mechanisms, new regulatory activity in Virginia and Ohio, and Alphabet's energization activity, which remains on track for the second half. We also have line of sight to over $40 million of cost optimization initiatives across the business as part of our broader efforts to reduce costs for our customers. These initiatives include process improvements, technology-enabled efficiencies, and other actions designed to lower overall costs while maintaining service quality and execution against our broader financial plan. Many of these initiatives are expected to continue to improve our cost structure beyond 2026 and will have a direct benefit to our customer rate structures. Our five-year capital investment outlook remains unchanged, shown on slide 12, with $21 billion of base business investment, $2 billion of upside opportunities, and $7.6 billion of Genco capital investment supporting data center customers. Our consolidated plan remains diversified and highly executable. Investments span our gas and electric businesses across six states, providing flexibility to allocate capital based on customer needs, regulatory frameworks, and the timing of recovery. Slide 13 highlights additional investment opportunities that are not currently included in our base or upside plans, including electric generation to meet MISO resource requirements, Gas and electric transmission and system modernization to enhance the resiliency of our systems. MISO long-range transmission projects to expand grid reliability. PHMSA compliance and advanced metering infrastructure to enhance safety and service for our customers. We are actively advancing these opportunities and developing the investment thesis in collaboration with stakeholders. As these projects progress, we will remain disciplined in selecting investments that deliver attractive risk-adjusted returns while supporting constructive recovery and creating meaningful value for our customers and communities. Slide 14, while unchanged, continues to highlight the generation additions and project pipeline supporting NIPSCO's ability to meet growing customer demand and advance the energy transition. Turning to slide 15, we are reaffirming NYSource's 2026 consolidated adjusted EPS guidance range of $2.02 to $2.07 per share. We are also reaffirming our annual base plan adjusted EPS growth rate of 6% to 8% through 2030 and our consolidated adjusted EPS compound annual growth rate of 9% to 10% from 2026 through 2033. Our capital investment plan supports base plan rate-based growth of 8% to 10% through 2030 and consolidated rate-based growth of 9% to 11% from 2026 through 2033. These commitments reflect our confidence in efficiently converting capital investment into earnings growth in a manner that is accretive to shareholder value. With the IURC's approval of our Amazon and Alphabet special contracts, GENCO remains on track to deliver incremental value to NYSource's consolidated earnings for 2026 and beyond, as shown on slide 16. We look forward to sharing additional updates as we progress through the year and as we build on our momentum with confidence to deliver incremental value as a result of our data center agreements. Slide 17 highlights our five-year financing plan. We remain committed to maintaining FFO to debt of 14 to 16 percent in each year of the plan, supported by a balanced mix of cash from operations, long-term debt, annual equity issuance of approximately $400 to $600 million in minority interest contributions. As we execute, we will continue to evaluate financing decisions based on market conditions, project timing, credit metrics, and long-term shareholder value. This disciplined approach allows us to de-risk the plan while preserving the flexibility necessary to advance future opportunities. And finally, slide 18. We remain confident in our ability to deliver our 2026 outlook and long-term financial commitments. Our regulatory execution provides visibility into earnings and cash flow. Our capital investment plan is diversified across businesses, jurisdictions, and investment categories. Our operational initiatives are supporting productivity and cost discipline. and our data center strategy adds a meaningful layer of growth while protecting existing retail customers. We continue to build a strong track record of execution. Our commitment to customers, investors, employees and all our stakeholders remains central to everything we do. Nisource offers a diversified and fully regulated utility with the opportunity to invest in programmatic gas infrastructure and long-term energy transition for a fully integrated electric business. We believe continued progress accessing unprecedented energy development and power demand resulting from robust economic development, on-shoring, as well as new data center development truly differentiates the value proposition relative to many alternatives in the marketplace today. And with that, operator, please open the line for questions.

Thank you. We will now begin the question and answer session. If you have dialed in and would like to add a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again. If you are called upon to ask your question and are listening via speakerphone or device, please pick up your handset to ensure that your phone is not on mute when asking your question. We do request for today's session, but you please limit to one question and one follow-up question only. Thank you. And our first question comes from the line of Julian DeMolin Smith with Jefferies. Your line is open.

Hey, good morning to you. Nicely done again. Look, maybe just to kick off here in light of the news this morning, can you talk about the affordability backdrop and specifically today's T-Disc order, if you can use that acronym that way or pronounce it that way? How are you thinking about tracker recovery and multi-year rate plan risk at this point? Again, I don't think today's development was necessarily surprising or shocking per se, but I'm curious on how you think about the road forward here specifically in response to the latest outcome this morning.

So good morning, Julian. Thanks for your question. So let me say, first of all, we're still in the midst of evaluating that order that occurred probably less than an hour ago. As we take a look at it, I will tell you that this decision is not really a reflection of the broader regulatory environment in Indiana. We believe Indiana will continue to be a constructive regulatory environment for NPSCO. So the decision doesn't preclude us from seeking recovery of that investment in future regulatory proceedings, including applying for other trackers for recovering those costs in a rate case. I think the signal we got out of that order is, you know, we need to continue to invest, but do a better job of demonstrating the benefits of those investments, which we will do. So we're confident that this commission is constructive. They want us to continue to invest in the natural, because this was a natural gas, T2C. They want us to continue to invest in the natural gas system, do a better job of demonstrating the benefits, and come back and recover those costs. I think with respect to broader affordability, of course, when you think about all the affordability issues that are occurring, they've occurred mostly on the electric side here in Indiana. I think for us, so I think gas is not in the crosshairs, but we'll pay attention to affordability. We want to invest prudently. We continue to do a good job of taking costs out of the business, making sure we're allocating capital efficiently, and we'll We're happy to engage with the Commission on any other affordability issues they have associated with the gas business in Indiana.

Excellent, right? But it doesn't change your rate case timing, right, obviously?

It does not.

Right, excellent. And then, if I can, getting back more to an ongoing question here, can you speak a little bit to the backdrop here on the three gigawatts. I mean, Lloyd, I certainly heard the tone of your voice in talking about where you stand on these strategic negotiations. And how advanced are they? And specifically, you know, there's been some public reporting around these large zone developments in LaPorte County specifically. I'd love to hear your latest thoughts in any color you can add around where those in particular stand. State seems very keen to see some of this stuff materialize. Can you comment at all?

So what I'll comment and say, you know, I think we did a joint announcement with Microsoft back in 2024. We've been talking to Microsoft since then. But I'm not going to comment on that specific opportunity. What I will comment on is, you know, I talked in my comments about, you know, we've signed four gigawatts. We're active with strategic negotiations for another three gigawatts. And we have another two gigawatts behind that. We're also looking at the system to see how we can expand beyond those nine gigawatts. So we like where we are. We think the data center business is a huge opportunity for NYSource slash NIPSCO. We think that a key to affordability is This Genco model, the fact that we're giving back $1.4 billion to our customers and as we add more data centers, that number grows, not including the thousands of jobs that will occur as a result of data center development. So I know I didn't answer you directly in commenting on Microsoft and Laporte, but I do say we like where we are. We're confident that we're going to execute and looking forward to reporting more information to you guys as soon as we have it. Michael, you want to add anything to that?

No, I would just echo the comments that we're very confident in our pipeline. We only have more confidence in it as we continue to have these discussions and negotiations and just like we've done previously as they come to fruition, we will be very disciplined in communicating those once they occur.

Awesome. Thank you guys very much. I appreciate it. Good luck. Thanks.

Our next question comes from the line of Shar Perez with Wells Fargo. Your line is open.

Hi, actually it's Andrew Cadeveon for Shar. I was wondering, could you guys maybe give us some expectations for what we should expect out of the August 7th technical conference on the ROEs and the trackers?

Our expectations is I think the results will be balanced. They'll be collaborative. I think that when you look at the affordability report, it looked a lot at bill transparency. I think that we're going to take a hard look at the group around multi-year rate planning and the ROEs and how much risk should be applied to the ROEs with respect to multi-year rate planning. A lot of this was contemplated in House Bill 1002 in that legislation. So we're optimistic here. We think it will be balanced. We think it will be, again, be good for customers. We think we'll have a lot of input into the results of that. Melody, anything you want to add to that?

No. You summarized it, I would say, Lloyd, completely. We do believe it will be balanced, and we understand the importance of the commission having this hearing on the 7th, and so we're just awaiting any findings, and we'll participate and cooperate with the IURC.

Thanks. And then switching gears a little bit to JNCO, with earnings starting this year, when should we expect kind of the segment to be broken out? Should it be this year, maybe next year, or when there's more ramped load?

Shawn, you want to handle that? Yeah, absolutely. Good morning. Yeah, we continue to be on track to start reporting segment information by the end of the fiscal year. Thank you.

And I'll leave it there. Thank you.

Next question comes from the line of Nick Campanella with Barclays. Your line is open.

Morning. Thanks for taking my questions. Morning. Maybe just really quick on the T-disc. I know you're still digesting it, but just mechanically, if you could just kind of clarify for folks, this is a capital tracker that would kind of true you up in 27 if I have that right, and how much is the capital, and just is there a way to think about the EPS impact? Thanks.

Shawn, you want to look at that? Mm-hmm.

Yeah, thanks, Nick. What I'd answer, Nick, is Lloyd hit the important point, which is the thesis and the need for this investment inventory remains unchanged. In fact, the commission's encouraging NIPSCO to invest in all reasonable and necessary projects. We need to focus on demonstrating these projects as reasonable and necessary, which was part of our filing. We'll look at options for us to include this CapEx across either the T-Disc mechanism itself, the FMCA, which is another mechanism that can account for and qualify some of this investment, as well as in rate case activity at NIPSCO Gas, which can include forward look on CapEx investment. So we don't believe the CapEx plan is unchanged. We'll look at the flexibility we have across the array of options that we have in Indiana to recover that CapEx. So we're not reporting any change in CapEx plans or any change in EPS outlook as of today.

Okay. And then maybe just kind of going back to the nine gigawatts and doing the study to see what you can do beyond that. It just It seems like you're progressing well on the data center pipeline. I mean, is it possible that you've executed agreements that just haven't been disclosed yet? And if so, what's preventing you from talking about those?

Again, we, I would say, let me just, things are progressing well. I think that we have a lot of confidence in our ability to execute those agreements. And when we have the appropriate information to disclose to the market, we'll get it to you as soon as we can.

Okay, thank you.

Next question comes from the line of Nick Amicucci with Evercore ISI. Your line is open.

Hey, good morning Lloyd and Shawn. Morning. Just a couple of quick ones for me. I know, so obviously a lot of political rhetoric just kind of out of Indiana. And I guess if we could just kind of level set at the risk of, you know, kind of sounding like a broken record because I feel like we asked this quarter on quarter. But just, I guess, what is the governor's kind of ultimate objective and how do those align with what you guys are seeing and across the state?

Yeah. What I think about in spite of the activity that you're seeing in Indiana and specifically around the commission changes, we believe and some of our conversations believe that Indiana will continue to be a very constructive regulatory environment. I think when you talk to the governor and all the relevant stakeholders, I think everyone's aligned on the importance of economic development. that growth is the key to affordability in Indiana. And we believe that the data center opportunity, reshoring, manufacturing, all those things not only Deal with affordability. If you think about what we're doing, the $1.4 billion is back to customers, but the thousands of jobs being created in the state of Indiana as a result of that economic development. So I think there's significant alignment around that. I think that we're all focused in that area, and I think that that's what the market should pay attention to because, I mean, no one's deviating from that at all. We also understand affordability is important, but the key to that is economic development.

Great. Thanks, Lloyd. And then as we think about, so obviously just kind of looking at slide 12 here, very helpful. And as we kind of think about the upside to the base plan, I guess how, just because there's a little bit layered in 2026 and a little bit in 2027. And so it seems, you know, obviously 29 and 2030 kind of the brunt of it. Just as we think about the needed expectation for some type of an announcement or the ability to execute on that upside, from a timing perspective, is that 2026 upside able to be pushed into 2027 and then you still hold the entirety of that $2 billion in the capital plan or just trying to think through that?

John, why don't you handle that? You bet. Hey, just to square the upside point, just to clarify, pertains only to the base business, does not include any Genco CapEx. So the $2 billion inventory is largely attributed to generation, some gas AMI and FIMSA-related work. Economic Development, T&D on the electric side. So there's an array of options in there. They don't require disclosure. We can usually work those directly into our plan in the context of either the tracker programs or the regulatory recovery mechanisms we have. We still have the flexibility to do that, and we still believe that some of the 2026 CAPEX will get executed. Thanks for the clarification.

Next question comes from the line of Travis Miller with Morningstar. Your line is open.

Good morning. Thank you.

Morning.

Just to stay on the whole affordability theme, can you talk a little bit about how you're thinking about schedule and timeline as you move through this affordability discussion overlaying your rate case potential filing? at some point in the next year or two. What's your thought in terms of that timing element? Do you want to get through all the affordability discussions before doing a rate case in Indiana or are you happy to do them together?

I think August 7th we'll learn more about the affordability conversations and more importantly the outcomes of those conversations. Those are not connected to our rate cases yet. You know, we're studying when we're going to file our rate cases and when we need cost recoveries associated with those. So I would not connect those two. I think that the August 7th conversations and the outcomes will inform when we decide to file rate cases. We know that we have to go into our, in terms of multi-year rate planning, and file in the second half of 2028. And that hasn't changed at all. Okay.

Is the rate case filing, remind me, rate case filing the way that you'll return those customer savings from the data centers, or is there a separate mechanism for you to do that?

No. Once we energize, after you get the appropriate regulatory approvals and we energize, those savings will start to flow immediately. And they'll show up as a detriment on the customer's bill. Okay.

Perfect. I'll leave it there. Thanks so much.

And again, if you would like to add a question, press star then the number one on your telephone keypad. Next question comes from the line of Steve D'Ambrizi with RBC Capital Markets. Your line is open.

Good morning, Lloyd and Shawn. Thanks for taking my question.

Good morning.

Just to follow up and you made a comment in response to Julian's question just about looking at the system and potentially seeing how you can expand beyond the nine gigawatts. I guess, can you just explain what you mean by that and or what would be required like across the system? Is it other than just more generation? Is it transmission? Is it and then just also does that mean like am I to interpret that that the up to nine gigawatts is like a So basically, I mean, it's just part of our normal process that we work through. And it's not pointing to any specific constraints with the nine gigawatts.

It's literally what Lloyd says, looking beyond the nine gigawatts and the opportunities there.

We're consistently looking at the pipeline and facilitating that and also what we could do in expansion beyond it given the demand we're seeing from counterparties. That means we're looking at all the factors related to that, whether that be land, zoning, transmission, fuel supply, equipment, etc., and just planning ahead like we've consistently done to enable that pipeline growth as we see it occur. We feel good about it. We feel good about the opportunities. And you should not interpret that we're looking at the ability to expand further as any sign of a constraint, but more as pre-planning so that we can focus on execution.

Understood. Very clear. And then just as a follow-up, I understand you're still digesting the order, but from my read, it looked pretty clear that they are indicating that you should use the FMCA at a minimum and maybe some other pre-approval tools. So can you just highlight, I guess, roughly how much of the ask from a capital standpoint was federally mandated spending?

Sure. We don't disclose the breakdown in the inventory by state nor by mechanism, but we're confident we have recovery mechanisms to secure all of our 2026 and 2027 CapEx and earnings guidance. We'll continue to work with stakeholders to understand on a longer-term basis how the multi-year view of this inventory should get recovered. However, we're confident that we have the avenues in play for the near term.

Very clear. Thank you very much. Appreciate the time.

There are no further questions at this time. I would like to turn the call back over to our CEO, Lloyd Yates.

Again, thank you for your interest in NYSource. We appreciate the questions and look forward to talking to you soon. Thanks.

Ladies and gentlemen, that concludes today's call. Thank you all for joining and you may now disconnect.