Vistra Corp.

Welcome to the Vistra Corp. Second Quarter 2026 Results Conference Conference will be in a listen-only mode. Should you need assistance, pressing the star key followed by zero. After today's presentation, you will have the opportunity to ask questions. To ask a question, you may press the star key on your phone. To withdraw your question, please press star, This event is being recorded. I would now like to turn VP of Investor Relations. Please go ahead.

And thank you for joining Vistra's Investor Webcast discussing our second quarter 2020. Being broadcast live from the Investor Relations section of our website. There you can also find copies of today's investor presentation and earnings. Jim Burke, Vistra's President and Chief Executive Officer, and Chris Moldovan, Vistra's Chief Financial Officer. Other senior Vistra executives will be available to address any of these calls necessary. Our earnings release, presentation, and other matters discuss certain non-GAAP financial measures. All references to adjusted EBITDA and adjusted EBITDA without this presentation refer to ongoing operations of adjusted EBITDA and ongoing and more growth. Reconciliations to the most directly comparable gap measure in the appendix in the investor presentation available in the investor relations section. Today's discussion contains forward-looking statements which are based on assumptions. Such forward-looking statements are subject to certain risks and uncertainty materially from those projected or implied. We assume no obligation to Good morning and thank you all for joining us. We remain on track to

to perform very well and environment with both this recent experience power to our customers in a reliable center development activity remains strong. The activity level we see today reinforces our term expected improvement in power market fundamentals is underway and

and many more opportunities ahead. Turning to slide five, the team is working the first quarter momentum to deliver strong first half results for the quarter adjusted EBITDA of nearly $1.8 billion dollars of approximately $1.35 billion dollars represent increase year over year. At the core of these results Thank you for joining us today. refueling outages for three of our units and our gas and coal planned outages in preparation for the summer run. This heat waves in Texas and PJM where we achieved commercial availability across the entire fleet. Moving to the outlook for 2026 adjusted EBITDA and adjusted free cash flow before growth and the potential 2027 adjusted EBITDA midpoint opportunities. We'll talk about that in detail later. Finally, we are also pleased to announce our partnership with the University of Pennsylvania and the Kuwait Investment Authority to be a founding investor. Helix will focus on combining power solutions for datasets and infrastructure, creating a rack-to-grid, one-stop-shop solution As part of this solution, the Helix platform will seek to improve our markets, our proven commercial track record, and our tailored energy solutions. Vistra's role will be twofold. Vistra will commit up to $1 billion to be invested over time, $100 million subject to the achievement of certain milestones. and what we expect to be a leading digital infrastructure platform. The preferred power partner, allowing us to participate in Helix development, contracted new build projects or through new contracts with existing apps. Structure creates an additional avenue for growth and broadens our participation. The digital economy expands.

And importantly, we retain to do so, while continuing to look at what the potential this platform brings to our community. Turning the slide around, we've actually improved demand environment and annual load growth of at least four to six Thank you for joining us.

Thank you for joining us. have driven strength in PJM forward pricing, the power price environment. We view this as normal with variability expected, and weather impacts can change year to year. We believe long-term impact across our key markets, and our team is committed to delivering on our strategy. This quarter has demonstrated strong execution, To be left out of the discussion, we have been very active on many fronts in our process and advocacy in our key markets. While there are still many things we are encouraged by the direction of travel, I kept my opening remarks an opportunity to provide our perspective on this topic in Q&A. I'll turn it over to Chris to provide more details on our second quarter results or outlook.

Thank you, Jim.

Turning to slide eight, Vistar delivered $767 million, representing a more than quarter of 2025. This strong performance was driven by and retail segments, reflecting the benefits of our integrated program. Our generation business delivered approximately 900 in the quarter, The year-over-year improvement was primarily driven by favorable and the company's average realized prices being approximately five percent higher compared to the same quarter last year. Optimizing the run profile of our flexible gas generation The Restart of Martin Lake Unit 1 and Contributions in the Second Quarter of 2025. Retail also had a strong performance in the second quarter of 2025. Retail also had a strong performance in the second quarter of 2025. Retail also had a strong performance in the second quarter of 2025. Retail also had a strong performance in the second quarter of 2025. Retail also had a strong performance in the second quarter of 2025. We are reaffirming our 2026 adjusted EBITDA guidance range and our adjusted free cash flow before growth guidance to $4.725 billion. We are confident in our ability to deliver at or above the midpoint. Looking forward to 2027, current ERCOT forward curves are meaningfully Thank you for joining us today. As a reminder, that range excludes any contribution from the pending acquisition of Cogentrix and the premium under the long-term power purchase agreements at our PJM nuclear site. Finally, turning to slide 10, our forecast indicates that we will generate more cash in 2026 and 2027. We have in allocating this available cash. We have allocated equity holders in 2026 and 2027 through share repurchases. Notably, our share repurchase program continues to create initiating the program in November 2021. We have retired approximately at an average cost of approximately $38 per share. $2 billion of share repurchase authorization remaining. I am also pleased to report that we have returned over $6.5 billion to our shareholders through ShareRegister in the program in late 2021, well ahead of the target we commuted to $6 billion through year-end 2026. For $6.5 billion in the 2021 trading plan, A repurchase activity through July continues, given the elevated free cash flow yield indicated by our share price. In addition to allocating significant amounts directly to our equity holders, we also The development of the Permian gas units, the PGM nuclear operation, the development of the Oak Hill II solar facility support, and now our capital commitment to Helix. We predict the amount or timing of any potential capital calls by Helix. Thank you for joining us today. and further strengthening our balance sheet. Great credit ratings from two of the major credit ratings agencies. Our long-term goal is to achieve mid investment grade credit ratings at all agencies. We believe we can achieve these ratings primarily through but we will also consider allocating some of our available capital to additional debt We believe mid-investment grade credit ratings would allow us to continue to opportunistically grow our business and would position us as a great organization. In closing, we are pleased with our second quarter through the first half of the year. We continue to see load growth materialize and we believe our integrated business model positions us well to deliver significant With that operator, we're ready to open the line for questions.

Begin the question and answer session. To ask your question, on your touchtone phone. If you are using a speakerphone, the keys. If at any time your question has been addressed, please press star, then two.

At this time, we will The first Correza with Wells Fargo. Please go ahead.

It's actually awesome being here for Char. I appreciate the time today. Oh, not too bad. Good morning. I just wanted to get your view on Texas. Delay is batch zero. Have there been any commercials or counterparts? There's a lot there. I appreciate the question. We put out a load forecast a little over

with an expectation of 150 lots of load in ERCOT in 2030. That's still what we're projecting. Fundamentals of the business, we haven't actually changed. Even though the queues have certainly grown. And I think that's part of what we're balancing is I think the concerns around generation When you look at a lot of the media reporting, and I think the demand is being expressed in these queues. So policymakers are saying we need to make decisions because they're going to prioritize reliability and affordability. We support that. We fully support it. So I do think in the near term, it's going to probably pause some of the reviews for a couple months. The key project that we have in our portfolio at Comanche at the end of 2027, we don't see that being effective. The conversation that the governor is wanting to have with the data that Texas does this right. So I don't think it's a concern. I think and we'll talk, I'm sure, at some point in the Q&A about the you see right now is the grid has more supply on it this low expected to hook up in the 27-28 time frame so not that big of a surprise to us that's also why we do the conference so I'd like to see the queues called at the end of the day the criteria and raise the bar on what is being proposed from I think it's somewhere in the 12 to 15 gigawatts by 2030. Stated by more than 20X. It causes problems for the port, the thinning of the queues, and getting the better realistic work.

Excellent.

Maybe just shifting to some of the commercial constructs, there's been multiple data points recently from peers around new projects, projects, IRR, pricing, margin expectations on existing gen. Do you have a view here? Should long-term contracting still focus on the new build cost, kind of in that 90 range, or is there room for clean premiums to be marketed, etc.? ?

Yeah, there's a big spread. Obviously, that's one of the ironies of this discussion. Again, from a media standpoint, there's a view that power prices are too high. They need to come down. Depends on what you're measuring off of. Year to date, ERCOT wholesale prices have been $30 a megawatt hour. They were $30 a megawatt hour last year. $30 is not going to get new stuff built. That's part of the dilemma. I think even when we talk about PJM and talking about a cap on the RBP of 555, that might get some things built, but there's still a lot that may not get built if you're looking at that as a hard cap. Now, there's a range with that 555, so some things can bid above it if something's clear below that. But in our role as investors and also owner-operators, the price of equipment in some cases has doubled, if not tripled. So what was an acceptable price to build at a year or two ago is no longer an acceptable price. So I think the challenge is going to be, from a contracting standpoint, is when the customers, the large load customers, they are interested in contracting with existing, and they are interested in contracting at a premium with existing because it's still a discount to what new build costs. would require, whether you're doing it bilaterally or you expect to do it on your own, as a behind the meter or island. So there's a big spread there. That's why I think our large baseload position, there's a big spread between what we're currently receiving in a day ahead spot type market versus what new build looks like. So we still see that interest level from the customer base. and I think you're going to see customers still contracting for new because there's areas of the country they want to be and they're looking for speed and there's going to be customers that are contracting with existing. So our views on that have not changed. And as far as margins and premiums, our views on that haven't changed. I think the cost of new build has continued to tick up.

If there's anything that's changed, that's kind of been where we've seen the pressure.

And the preference for Vistra is still kind of the hybrid solution, so makes a new plus existing capacity for this sort of deal?

Yeah, look, we have been a bit of an all the above. It really is customer driven. And some customers are going to put more of a preference on new and additionality. Others are going to look more for speed and where can they get hooked up. So co-location, for instance, can bring a speed advantage to hook up that even a new build, even if it were islanded, might still take more time. So, yes, we're going to be in all forms of that. We have to get a return that we think is attractive for our shareholders, but we have the capabilities to be in all of those solution sets, and I'd expect us to continue going forward.

Makes sense. No cookie-cutter approach. Appreciate the time today. Thanks so much. Thank you. Thanks for the questions.

The next question comes from Jeremy Tonet with J.P. Morgan. Please go ahead.

Hi, good morning. Hey, Jeremy. Hey, Jeremy.

Interesting times across both PJM and ERCA. I was just wondering if you could, you know, talk about the relative dynamics between the two, and you're looking to secure more, you know, contracts, I guess, how the conversation trend, you know, compares, contrasts between the two.

Yeah, that's a great question. I'll start off, and I'm going to ask Stacey to comment since she is in the middle of these discussions on a daily basis. The two markets are starting in slightly different places. So as you know, with Texas, and you can see it in the forwards, you can see it in the real-time settles, the Texas market is just a lot less tight at the moment than the PJMs. and what we have here is a situation where customers are just trying to get through the study processes. ERCOT took an approach to do a bad sort of slow things down for a moment and then study as much as you can realistically at once to give clear guidance to people. Now that's going to pause for the reasons we just covered on the call for a few months but the approach is still the same. and PJM. There's still a process that's much more localized in terms of how the study process works and obviously even the criteria that's being used around some of the wires costs and whether there's minimum takes and credit and other things that are still not yet settled in ERCOT. So the markets are at different levels of maturity in terms of how different utilities are prioritizing the studies and the load and we have to work with customers on that. Of course our assets have some unique characteristics in each market. But since we're having conversations across both those major markets, I'm going to let Stacey provide more color on how she sees these developing.

Yeah, thanks, Jim. And thanks for the question, Jeremy. We continue to see a lot of interest in both PJM and ERCOT. We're in active discussions in both markets across multiple sites. Thank you so much for joining us. and each customer is a little bit different in that regard. You know, they have their own zone type goals. And when they come to us, they kind of share with us, you know, where they're looking to locate their data centers. And we continue to see really high interest in both of our largest markets are caught in and PJM. And, you know, I'd say the regulatory uncertainty, of course, customers want More clarity, and as we move along, we're getting more clarity. We're seeing a lot of progress at FERC. As Jim started the Q&A session off with, we're also supportive of Governor Abbott's attempt to kind of thin the queue and ensure responsible development. And you've seen customers come out in support of Governor Abbott's efforts. So those are positives. Those are actually helping us move towards clarity. And at the same time, you know, as we've seen with even the contracts we've executed to date, customers don't need perfect clarity in order to contract. You can find ways to deal with those risks, you know, through contractual provisions. And so they're not waiting on perfect clarity, but obviously the more clarity, the better. So, you know, we continue to feel very optimistic about our opportunities in both PJM and ERCOT.

Got it. That's helpful. Thank you for that. And then dialing into PGM a little bit more, just wondering, you know, as PGM continues to evolve here and we step towards the RBP, wondering, you know, what Vistra's strategy would be here, the relative level of appeals here, and also how RBP compares to bilateral, you know, discussions, if there's a preference one way or the other.

Yeah. So, I believe the bilateral discussion, which is something we've been supportive of even under current market conditions, you know, unrelated to whether we're specifically talking about an RBP and the other framework around this IRAs, which I'm sure we'll talk about. Setting that aside, the bilateral conversation is something that we have real possibilities with customers. We have good sites. We have some opportunities to develop these with their interests. Again, that has to meet their needs from a speed and a cost standpoint. So that's a willing buyer, willing seller marketplace. But any bilaterals, as you know, that get done, that meet the hurdles, could drop the required RBP procured amount. And ultimately, over time, I think if energy markets and bilaterals can continue to develop adequate returns, even less dependence on a capacity market, I think would overall be helpful for and many more. Thank you. The 555, there's going to probably need to be a spread around that $555 a megawatt day for certain projects to work. And so there's going to be pressure there. I think the bilaterals, you're going to see some pressure on that. So that is, again, the conundrum of power markets today are still lower than where new build would require power markets to be to earn an adequate return. So whether that's going to come through the RBP or come through Bilateral remains to be seen.

Got it. That makes a lot of sense. Since you brought up IRAs, maybe any thoughts you could share there, how you see things unfolding from this point?

Yeah, I'm going to start off, but I'm going to turn it over to Stacey. A lot of detail and tracking all of these dockets and how this is unfolding. I just would like to say that our discussions with customers have been evolving over the last two years, and we've mentioned this, that Large load customers are willing to be part of the solution. They're willing to offer some flexibility. Our DNA is a choice-based DNA. I mean, we'd like customers to have incentives to be flexible, whether that's speeding them up in the interconnect queue, being able to ramp their load faster, maybe getting a discount on wires or capacity if they offered NDR. So we're much more of a carrot approach because certain customers are making investments to be flexible, they should be compensated for it in some form, either actually or with speed. Some of these dockets, and we understand why, go much more to a stick approach. And it effectively says if you don't do these things, you're at risk of disconnection. I think that's a much more blunt instrument. And I think this idea that you might actually be required to curtail before those that were paid to be curtailed. That feels odd to me. That's not the way markets should clear. You should actually have a spectrum of benefits or attributes that customers are willing to be paid for. And I think we've got to work on this, and we're going to weigh in on this, as I'm sure many of the stakeholders in the process will weigh in. And it's not filed yet, so we don't know all the details, but obviously there'll be a lot to unpack when it comes in. So I'm going to let Stacey add any comments to this.

Yeah, the only thing I would add really, I mean, I think Jim covered it well, is, you know, we obviously have said for a long time, we don't support bring your own new capacity mandates. As we referenced even in this discussion today, customers in PJM are already in conversations about bilateral agreements for new build. And, you know, we should let the market drive the incentives to do that rather than using kind of the stick approach. So we will be weighing in on that proposal when it gets filed at FERC. Many others will be as well. We do continue to believe that data center flexibility is a key asset, really, for the grid. And it should be encouraged, but it should be encouraged with incentives. And it should also be recognized as a valuable resource that can be used during times of grid tightness. and so we you know we we need to kind of wait and see what the proposal says and see what you know what provisions are really specified in that proposal before we respond but we do have some concerns about it we think customers have some concerns about it as well and frankly you know it may actually even give some advantage to co-location with existing resources we believe at the end of the day because There's still a speed advantage to avoiding some of the transmission build that's necessary often to connect front of the meter. And typically in these co-location conversations, customers are bringing backup generation anyway. And so we actually see it as potentially driving customers to be even more interested in co-location with existing resources.

Got it. That makes a lot of sense. Thank you. Perfect. Thank you.

The next question comes from Michael Sullivan with Wolf Research. Please go ahead.

Hey, good morning. Good morning, Michael. Hey, Jim. I wanted to ask a little more on the Helix platform and just how you see that playing out. You know, you had a big announcement and you put some money into it this year. How does that materialize through time? Maybe some color on what the milestones are that would, you know, require putting more money into it? and then like, how does that work as the same time you've been working through some of these existing commercial discussions?

Yeah, Michael, thank you for that. First of all, it is considered an additive proposition for Vistra. So as we looked at the extent of the customer conversations we were having, and I've even mentioned on previous calls, we've added staff to have conversations and Stacey would say she's still short staffed to have conversations. So it's part of extending our, what I'd call our channel, our capability to actually evaluate more deals. And it's focused on both existing assets and new assets, and then bringing a simpler solution for customers so they can talk about the infrastructure of a data center and where it gets its power. And today they're having to string all these conversations together. And it is complicated and they're going fits and starts. And so Being customer focused, our partnership, obviously led first by KKR, is helping us to bring a platform to a customer conversation. It is an option for Vistra to participate on any of these. So if we want to use an existing asset to support a deal like this, that's our opportunity. It's not a requirement. But we're excited about it because the more deals you can evaluate, the better chance you're going to find something that's meeting the spectrum of customer need as they evaluate their business over time. In addition, there's some criteria that if there's certain milestones met and the deals are actually coming and they're valuable to Vistra, then we'd put in an additional $500 million. And we'd be excited to do so because we wanted the interest to be aligned. That was important for us. That was important for and the other partners is that they're skin in the game. So we're excited about the opportunity. We think this is again a customer orientation and we view that the chance to market our current assets as well as develop some new ones with someone who has a much greater access to capital in a sense that if it's required to do things like powered shells, powered land, that's something we don't believe our shareholders are expecting us to put a lot of capital in given our core business, but having a partner who can is very complimentary. And that's how we see it unfolding.

Okay, great, very helpful. And then Chris, I think you mentioned just in terms of the financial outlook, midpoint or better in 26, maybe just a sense of what's driving that. And then for 27, The midpoint opportunity, you mentioned the ERCOT softness and some of the offsets there. Should we just think about that as kind of netting out to a similar place or any kind of like upward or downward bias around that range?

Yeah, thanks, Michael. I think on 2026, obviously, what we talked about in the prepared remarks were the start that we've had to the year positions as well. And we see ourselves We don't typically, it's not typical for us to change guidance absent, you know, if there's a deal has closed or something at this time of the year. We're still getting through the summer, but we still feel good about the full year and that we'll be at or above the midpoint. And, you know, we have confidence that that'll be the case. As we turn to 27, as you mentioned, and as we mentioned in the prepared remarks, The ERCOT forwards are meaningfully lower. That headwind is offset by some higher prices in PJM, and we do have the hedging program and the downside protection of the PTC. I would say that they don't fully offset the ERCOT headwind, so we would be trending towards the lower end of that range. But, of course, we have announced two significant transactions that aren't included in that, and that's Cogentrix and the Meta PPA, they're still excluded. So our current expectation is that we'll provide a guidance update for 2026 and 2027 on the third quarter earnings call. If Cogentrix hasn't closed at that time, we'll wait and likely provide an update to earnings for 2027 on our next earnings call after it closes. Again, with those two transactions though, as you look to 2027, that we have not included, based on our previous disclosures, you could reasonably conclude that they'd add roughly $700 million to our midpoint opportunity, absent any other impacts. And those impacts could obviously be further curve moves or what we learn about the hedge levels with respect to cogentrics, among some other things. We're excited about 2026, and we feel that we have an opportunity to get back to where we want to be in 2027.

Great. Very helpful. Thank you.

The next question comes from James West with Mellys Research. Please go ahead.

Hey, good morning, Jim and Chris. Hey, James. Hey, I was curious to dig in a little more on Helix. Deep pocket is a good term to use to describe your current partners. But you also described yourselves as founding partners, which maybe suggests additional partners are coming in. So that's kind of the first part of the question. And then the second part is, how are you thinking about this entity and its capital raising abilities Going forward, is it going to be from these infrastructure companies that you have and these investors that you have, or do you think this is something that could be a publicly traded entity over time? I mean, how are you guys thinking about the evolution here?

Yeah, thanks.

I think we are a founding investor, and we do expect that they will continue to add more investors over time and substantially increase the amount of the capital that they have access to. I think from how we utilize that, the best word is we have a lot of flexibility in every deal. There'll be deals where we could potentially, each deal will be different and we could access some, we could bring them in as an equity partner in any kind of new build power that we do. We could do that all of ourselves. We could search other opportunities to finance those. So I think Each deal will be different. We do expect to work with them. But on the power side, it'll be a negotiation each time about how we go about financing our portion of any transaction that we get involved in.

And James, let me just add, one of the things we were really excited about is KKR actually approached us as part of this and wanted us to be the preferred power partner for this project. and that gives us a lot of optionality with this and again, not a requirement. If there is an opportunity for Helix to develop a project in a market that doesn't really make sense for Vistra's capabilities, we may not be the actual power provider in that and we want Helix to be successful. But since we cover so much of the market and the markets we're in are actually attractive data center markets, We expect to be developing and being in that relationship with Helix to be able to bring a powered solution, whether it's existing assets or new. But we want to be good partners. And so if we don't have something to bring to the table on something, we'll just be effectively carried in our financial investment that we have committed on the deal. But we do expect a lot of overlap with what we're doing and what they're doing.

Okay. Okay. Got it. and maybe just one quick follow-up, and you may have mentioned this earlier, I may have missed it, but with Governor Abbott's moratorium here, is there a certain timeline that's been set to go through all the audit process and to clean up the queue?

Yeah, well, first of all, this is also, and I know I've used the term media a couple of times, and I'm just trying to be clear. I'm just trying to recognize that things get distilled to words that aren't being used. Like there isn't a moratorium at this point in time and there is a pause on letting people know we were expecting to hear where we would stand from a base load for batch zero, you know, any day now. We expect that's going to get kicked out. And the PUC and ERCOT are going to work to get through these audits. We think in a couple months, But we don't see it impacting our projects in the timeframe that we were expecting to energize. It is possible that there were people looking to energize here in the more short-term horizon that might see a delay. But I think this is about confidence and the fact that there's a lot of attention on this data center topic. And I'll give you a simple example because we lived it. We've got two counties around our nuclear power plant. We had an idea that one of the counties would probably be the more ideal location to start siting a data center. There were eight projects being considered in that county. Per my earlier remarks, there's a reasonable chance there'll be no projects in that county. But it stirred up, as you would imagine, a lot of concern in the local community about, I might be okay with one of these, but I don't know if I'm okay with eight of these. We welcome the queue getting smaller and let the real projects move forward. But if there's some short-term delay as a function of that in the long run, I think we're all going to be better off if we can start talking about more realistic numbers.

Makes sense. Thanks, Jim. Thank you.

The next question comes from Carly Davenport with Goldman Sachs. Please go ahead.

Hey, good morning. Thank you for taking the question.

Morning, Carly.

Morning. Maybe just one on capital allocation. Just as you think about that $2 to $2.5 billion of cash available for allocation, can you talk about your kind of general willingness to lean in on the buyback if the market gives you opportunities and if that's something that you would potentially go back to the board on in terms of the remaining $1.2 billion on the authorization?

Yeah, thanks, Carly. I think I mentioned in the prepared remarks that we do have flexibility. We have the $1.2 billion left, and we said that we expect to exhaust that no later than the end of 2027. Both management and the board, as we look at opportunities for share repurchases, I think There could be an opportunity, and we are flexible in adding to the share repurchase program in 2026 and or 2027. I think if we add to it in 2026, we will go to the board and ask for additional authorization to make sure that we have at least a billion dollars for 2027 and potentially more.

Great. Okay. That's very clear. Thank you. And then maybe just one on you've referenced the moves in the power curves a number of times on the call. Could you just talk a little bit about the hedge updates that you provided and particularly on 2028? Is there any detail you can share across regions in terms of how you've changed activity across ERCOT and the east over the last quarter?

Carly, I don't think we're going to talk that much about hedging strategies in detail on the call. You've seen some offsets in the portfolio. Of course, you've seen PJM strengthening. You've seen ERCOT weakening. It helps to be a diversified player in this context. And that has played out not only in year-to-date results, but we expect that to continue to play out going forward. I think what we're seeing in ERCOT is a recency bias with what we're seeing with the weather and frankly a lot of batteries that came into the system post-August 2023 when the ECRS payments were rather large. And what we've seen since then is returns on batteries have been about a fifth of what investors probably expected that they would be. and that's the way competitive markets work. There's no guaranteed rate of return. And so, but they are putting more supply in critical hours in that bridging solar hours to wind hours and batteries were able to bridge that at this time. We're seeing the battery queues slow down, which you would expect. That's kind of natural when you're not getting the rates of return that you expected. and then you're gonna see the load eventually hook up. And that is something that we've talked about obviously with this data center load. In Texas, the oil and gas and the residential small business load is about three of the five to 6%. So the data center piece is about 2%. So you've got 3% CAGR on non data center sectors, about 2% CAGR being driven by the data center. I think we're going to see some strengthening that you're not seeing at the moment because of the recency effects. And I'd be interested, you know, Sean Stuckey's here, our head of commercial. They did a little bit of a deep dive on the battery performance just to give some insight as to how that affected Thank you, Jim.

that you needed the batteries to serve load and you needed about 25 gigawatt hours worth of batteries to serve and there's only about 31 gigawatt hours worth of batteries available on the system. So even though that day cleared $57, the batteries knew that they were not going to run out and so it was a little bit of a kind of a chase to the bottom as they were looking to and many more. Thank you. Very easily, with just a couple thousand megawatts difference in either thermal performance or load and or wind, $57 could have been $400 or $500.

And just to be clear, Razor's Edge is more about pricing. There were still reliability reserves that ERCOT was maintaining, but as you know, Carly, there's pricing mechanisms that as you get tighter, you'd expect to see the real-time prices reflect that. And so it really is, you know, a closer dynamic, and that's just the way these markets work, but good for customers. I mean, this is exactly the way markets should clear. That's what competition is. does, whether it's on the retail or the wholesale side. And so, again, this notion that this is a market that's not able to handle this load growth is not bearing out in the facts.

Got it. Okay. No, that's super clear. Really helpful color. Thank you.

Thank you, Carly.

The next question comes from David Arcaro with Morgan Stanley. Please go ahead.

Hey, thanks. Good morning. Hey, David. On Helix, I was wondering if you might be able to give any additional color on the project pipeline in terms of megawatts or any progress or timing that could be possible, just kind of where is it in terms of its development outlook? I'm also curious about return targets, if there's any way that you'd be able to frame that up maybe versus your own that, you know, capital return targets internally.

Sure, sure. I'm going to let Stacey take this one, David, since she's working the pipelines, both the internal pipelines that we have and the pipelines that we'll look at with our Helix partnership.

Yeah, thanks, Jim. Yeah, you know, it's obviously we just launched it last month or I guess in June, and so it's early days, but we're having very close collaboration with Stacey KKR in particular and they are staffing Helix up for development and we're really excited about the opportunity to simplify the conversation especially on our existing sites you know on our own we are working on in customer conversations about PPAs for our existing sites but those end up being in a lot of cases and many more. Thank you so much for joining us. Thank you so much for joining us. promised our investors. And so we would only do projects that hit our return targets. Obviously, Helix is going to have a bit of a different risk appetite for projects. And that's part of why we think it is a good channel for us to be able to look at projects and just benefit even as an investor from projects where maybe we're not providing the power, but they're taking more risk on capital. So It's a good opportunity for us to not only have another channel to promote our own pipeline but also to benefit from the economics associated with data centers to the extent that they get those projects done. So we're in very close coordination with them and a lot of activity going on to launch that business and we're in direct conversations with all of the major hyperscalers about it.

Thanks, Stacey.

Great, thanks. Yeah, that all makes sense. I appreciate that. Then I was just curious, looking at batch zero, do you have other projects outside of Comanche Peak, you know, that you may be working on with partners just within your own development pipeline that might be going through the batch zero process? Any color you'd be able to provide there would be great.

Yeah, thanks, David. We do have projects in batch zero base load, in batch zero to be studied load, and even in the to come batch one process, which is not yet finalized in terms of the rules for those. So we have multiple projects there. We're not going to comment on specifics beyond that, but we do have projects throughout the pipeline of batch zero.

And I think on the earlier questions, David, about some of the delays, I think the studied load, which would be studied in consideration of the base load of batch zero, that's part of what probably is going to see more of the uncertainty at this point. I think the base load projects, because they've been studied, you'd expect those to be moving forward. I think the to be studied has yet another potential of figuring out what's the allocation when is that going to be completed and that's why with some confidence we feel the baseload projects and obviously we need to make delivery dates for our customers but that's important you know that we keep moving forward and we haven't gotten any signals that that folks in Austin see the baseload projects at this point as being materially off of a timeframe. As I mentioned, if some were looking to energize in the very near future, there may be an issue, but ours are tagged towards next year. So we feel we can continue to make the progress we need.

And if I could just add, the PUC and ERCOT have worked really hard this year to launch Batch Zero in record time, frankly, and a very active stakeholder process. And so of course we will know more at the open meeting next week where they discuss the governor's directive and it's very important that they carry out the governor's directive and that you know what comes out of that are only projects that are going to engage in responsible development but I would just say I think that you know the PUC and ERCOT and and really all of Texas stakeholders are motivated to preserve the value that that they've created through the batch zero process and to get the audit done in a timely manner and in a way that it doesn't result in material delays for the projects there.

That's a good add. Thanks, Stacey.

Great.

Thank you so much. Appreciate it.

The last question today comes from Rini Singh with Bank of America. Please go ahead.

Hi, guys. Thanks for taking the question. Hi, Rini. I think first, you know, I think Stacey you mentioned that the IRAS procedure could increase, you know, some of this co-location, especially the speed to advantage and the transmission. I guess how are you thinking about that co-location proceeding? I guess the timeline for it and the remaining uncertainty that kind of we need to figure out for that procedure.

Yeah, thank you for that question. Well, first of all, I'd just say, you know, we were very pleased with FERC's co-location order. that came out in June. They have made it crystal clear that PJM and the transmission owners need to accommodate co-location. They need to adopt these new transmission services that do so. And they've given PJM very clear instructions about amending the tariff to do so. So that was a very positive development for co-location projects. And we see that customers see it that way as well. They had ordered PJM to make a compliance filing and the transmission owners as well by mid-August. PJM and the transmission owners have now asked for more time to do that. We don't know if FERC's going to grant more time, but if they do, I think they will still want there to be as quick of a response as possible because this docket has been pending. for some time, and FERC has made it clear they want these projects to be able to move forward with clarity. So I think sometime in the next, call it 30 to 60 days, whatever amount of time FERC decides to give PJM and the transmission owners, we will see a filing from PJM and the TOs that gets specific around accommodating these arrangements and the types of transmission services that apply to them, and that will give all of us clarity about the rates that apply to these projects as well. So we're very optimistic about the outcome of that and the order itself frankly adopted a lot of Vistra's arguments and positions as we advocated for those projects to be available to customers.

Okay, great. That makes sense. Thanks, Stacey. And then if I could just ask, like sticking on PJM, just like what's the appetite for contracting energy and capacity versus just energy with this environment of Potentially the bring your own new capacity charges and then also the possibility of being flexible in your conversations. Just how is that kind of shaping up?

Yeah, we're still seeing robust customer appetite for both energy and capacity. In order to actually power their data centers, they need both. And they see a rising price environment. And so they have interest in locking in and some cost for that. So I wouldn't say that we've, you know, seen a big increase in appetite for energy-only deals, although, of course, you know, we're open to whatever conversations customers want to have. But the conversations we're in, they're still interested in contracting for energy and capacity.

Okay, great. Thanks so much, guys. Really appreciate it.

Thank you, Renee.

This concludes our question and answer session. I would like to turn the conference back over to Jim Burke for any closing remarks.

Thank you, everyone, for joining. I want to take a moment to thank our team for their continued execution and service to our customers and communities, especially during these hot summer months. The other thing that we'll continue to do is give you the most accurate view we can on these supply and demand variables and how they'll actually play out. Well, I'm sorry. I thought I was done here, and now I'm I'm giving you more. But look, it's important that we give you an accurate view on these variables because these are serious policy matters and we're going to be engaged with customers and our peers in the industry and policymakers to get it right. And we look forward to updating you on the progress of our business. We look forward to seeing you also in the fall, hopefully in person.

And thank you for joining and have a great day.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.