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spk01: Good day and welcome to the Essential Utility Inc. Second Quarter 2021 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Brian Dingerdisen. Please go ahead, sir.
spk05: Thank you, Cassie. Good morning, everyone, and thank you for joining us for Essential Utility's Second Quarter 2021 Earnings Call. I am Brian Dingerdisen, Head of Investor Relations. If you did not receive a copy of the press release, you can find it by visiting the Investor Relations section of our website at essential.co. The slides that we will be referencing and the webcast of this event can also be found on our website. Here is our forward-looking statement. As a reminder, some of the matters discussed during this call may include forward-looking statements that involve risk, uncertainties, and other factors that may cause the actual results to be materially different from any future results expressed or implied by such forward-looking statements. Please refer to our most recent 10Q, 10K, and other SEC filings for a description of such risk and uncertainties. During the course of this call, reference may be made to certain non-GAAP financial measures. Reconciliation of these non-GAAP to GAAP financial measures is included at the end of the presentation and also posted in the investor relations section of the website. After the presentation, we will open the call up for questions. Here's our agenda for the call today. We'll start with Chris Franklin, our chairman and CEO, who will discuss highlights and provide a company update. Next, Dan Shuler, our CFO, will discuss our financial results. Chris will then provide an update on our municipal acquisition program and conclude the presentation portion before opening the call for questions. With that, I will turn the call over to Chris Franklin.
spk03: Hey, thanks, Brian, and good morning, everyone. Thanks for joining us. Let's start the call with a look at the second quarter highlights. We had another strong quarter with net income growth of 8.4%. Dan's going to discuss that in detail in just a moment. We invested over $404 million in infrastructure improvements throughout all of our systems in the first half of the year, as compared to $346.6 million in the second quarter of 2020. You might recall that in May, our long-term board member and former CEO, Nick Benedictus, stepped down, creating a vacancy on the board. Then in July, the board appointed Dave Szczesinski to join the board of directors. Dave currently serves as president, CEO, and director of Lancaster Colony Corporation and serves as president of T. Marzetti Company. It's a food company based in Ohio. At Essential, Dave will serve on our audit and corporate governance committees where he brings extensive experience developing and implementing plans for growth and with a very successful leadership team. The addition of Dave Szczesinski, along with Edwina Kelly, who was appointed earlier in the year, has brought our board back now to nine members. Also last month, the board approved a 7% increase to the quarterly dividend, which is now nearly 27 cents, marking three decades of dividend increases. Our municipal acquisition strategy remains strong as we announce the closing of our first fair market value transaction in Texas, and we have seven pending acquisitions totaling about $458.5 million in purchase price. And finally, we published our 2020 ESG report that fully incorporates our natural gas segment, and I'll talk a little bit more about that in just a moment. But first, the 7% dividend increase we announced in July marks the 31st increase in 30 years and the 76th consecutive year of quarterly dividend payments. We're very proud of that. Following the increase, the annualized dividend rate will be just over $1.07 per share. We're really proud of not only our commitment to providing safe and reliable access to natural resources for our customers, but also our long and consistent record of delivering shareholder value. Now, you might recall that last October, we launched our new ESG microsite, which included our 2019 results for our legacy water and wastewater operations. But I'm excited to tell you today that we are launching our 2020 ESG report on the microsite. We just published it in the last couple of days. And in the new report, gas operations are fully included for the first time. In fact, we provide the same level of depth for both our legacy water wastewater business and our natural gas business. We also share information at the enterprise level in the new report. Now, we didn't simply add gas operations to the report. We also included some new topics, and some more extensive information on some of the topics that I know are important to many of you as investors. I think you'll find the ESG microsite makes the experience even sharper, more dynamic, and even more user-friendly, so I hope you take a look at it. Now, this enhanced site covers our continued commitment to our mission despite our COVID-19 challenges. It also covers our excellence in water quality, including our seven-time outperformance of the average in the United States. It further discusses our 7% increase in diversity hiring year over year, along with more detailed workforce composition data, as many companies are now doing. This progress on ESG during a difficult year in 2020 helped us earn recognition as one of the 100 best corporate citizens in the Russell 1000. Again, something we're very proud of. While we're talking about ESG, I want to update you on our progress on the ESG commitments we announced at the start of the year. We set a multi-year employee diversity target to reach 17% of our employees of color. Currently, we're at 14% of our essential employees are people of color. We also set up another multi-year target of 15% of our suppliers would be diverse. We've made strong progress since the beginning of the year. In fact, we currently stand at about 9.6%. We've also achieved a 5% scope one and scope two emissions reduction. This is a strong start toward our ultimate goal, well, our 2035 goal of a 60% reduction in greenhouse gas from a 2019 baseline. and achieving that target will put us more than halfway toward our ultimate goal of net zero emissions. We're confident that we have the programs and the plans in place to achieve our targets and look forward to continuing to share our progress with you over the coming years. We know that our commitment to environmental stewardship, sustainable business practices, employee safety and diversity and inclusion, customer experience, and community engagement is also very important to our investors. And with that, let's talk about the second quarter financial results. Dan?
spk04: Dan Bauschardt Yep. Thanks, Chris. Good morning, everyone. We ended the second quarter with revenues of $397 million, up about 3.3 percent from last year. Our regulated water segment contributed $248.2 million, and our regulated natural gas segment contributed $141.6 million. O&M expenses remained relatively flat for the quarter, decreasing to $127.5 million in the second quarter, down from $128.6 million in the second quarter of last year. That income was up 8.42% year-over-year, from $74.6 million to $80.9 million, and earnings per share increased by $0.03 from $0.29 to $0.32. Next, we'll walk through the waterfall slide, starting with revenue. In the second quarter of 2021, revenues increased 12.6 million or 3.27% on a GAAP basis. You'll see that rates and surcharges were the largest contributors at 9.2 million, with the primary driver being the regulated water segment. Increased volume and growth from our regulated water segment provided an additional 5.7 million towards the revenue increase, while the price of purchased gas added approximately 1.5 million and other added 1.2 million. These revenue increases were offset by decreased volume from the regulated natural gas segment of 4.9 million due to the warmer weather than last year. Next, let's look at the water consumption by customer class. We had favorable conditions in the second quarter and water consumption increased in every state except Texas. In aggregate, water usage was up 4.2% in the second quarter. However, it's worth noting that for the first time since COVID started, residential usage declined. As you recall, commercial water consumption has consistently been down since COVID began, but with many businesses reopening and customers returning to the workplace, commercial usage increased 20% for the quarter, and our other segments were favorable versus last year as well. When compared to the first six months of 2020, overall usage was up 3% in 2021, as almost all customer classes increased their usage year over year. Operations and maintenance expenses were $127.5 million for the second quarter, down 0.85% compared to $128.6 million for the second quarter of 2020. Employee-related costs were up $4.6 million for the quarter, which included $3.2 million of increased medical costs. This increase was expected as many people delayed non-emergency medical visits during COVID and then recently began to return to their healthcare providers. Production costs and growth for the regulated water segment added another $2.2 million. However, these increases were offset by $4.3 million in other and $3.5 million in COVID-19 costs when compared to Q2 of 2020, resulting in the overall decline in O&M expenses. Next, we will review the earnings per share waterfall. GAAP EPS for the second quarter increased by 3 cents from 29 cents in 2020 to 32 cents. Rates and surcharges added two and a half cents, volume and growth from our regulated water segment together contributed a cent and a half, and O&M added nearly a cent. These were offset by lower volume from our regulated natural gas segment of 1.4 cents and another penny from other items, including depreciation, which brought us to gap EPS of 32 cents for 2020, for the second quarter of 2021. When we rolled out our formal guidance earlier this year, we provided relatively large ranges for our quarterly breakdown. For Q2, we saw warm, dry weather across much of our water service territory, resulting in stronger-than-expected water sales and more favorable-than-expected expenses, including O&M tax and other, which led to the strong 32 cents of EPS. This built off of what was expected and largely reflected by many of you to be a flat to down performance versus the same quarter last year, largely due to the way the people's repair benefit was reflected in our condensed year of ownership in 2020. While I know most investors are not particularly focused on quarterly estimates and are instead more focused on annual earnings, we want to bring additional clarity to what we see for the third and fourth quarters of this year. It's not our intention to permanently provide quarterly guidance. We thought it might be helpful to provide some additional details this year. Specifically, when you look at our year-to-date performance and add current consensus for Q3 and Q4, you might assume that we'd have a very big year for earnings. But keep in mind that there are expenses that are expected to come through during the second half, including expenses related to people's acquisition commitments, certain maintenance items, and increased healthcare costs that will keep us within our full year guidance range. Additionally, there are an incremental 6.7 million shares from the August 2020 Forward Offering that we expect to settle next week, and those additional shares will impact the EPS calculation. For clarity, we'll have those incremental shares for more than four and a half months in the second half of the year. Specifically for Q3, the gas business does not generally make money. When you look at Q3, you should expect something in the lower end of the 10% to 20% net income contribution range that we provided for the quarter. And for Q4, the gas business then starts to generate meaningful revenue again as the heating season begins, but we'll be waiting on new water rates in Pennsylvania and therefore would expect a result in the lower end of that range as well. Realigning these quarters and considering the expenses noted earlier, If we experienced normal weather, our full year results should be around the midpoint of the stated guidance range of $1.64 to $1.69. Moving on to rate activity and other matters. So far in 2021, we've completed rate cases or surcharge filings for our regulated water segment in New Jersey, North Carolina, Ohio, Pennsylvania, Illinois, Indiana, and Virginia, with total annualized revenue of $16.7 million. In our regulated natural gas segment, we've completed rate cases or surcharge filings in Pennsylvania and Kentucky with total annualized revenues of $1.3 million. We currently have two base rate cases underway, one for Delta Gas in Kentucky and one for Aqua Ohio. Importantly, we expect to file a rate case for Aqua Pennsylvania later in the month in line with the three-year rate case cadence that we have outlined previously, and we will provide additional details related to that case once it is filed. And with that, I'll hand it back over to Chris.
spk03: Thank you, Dan. Let's take a few minutes and review our municipal transaction activity. Matt Roge and his team, along with our state presidents and their teams, have been busy at work on our growth projects. Earlier this week, we announced the closing of the Commons Water in Texas. You may recall this water system serves about 1,000 customers in the Houston suburbs and is our first fair market value acquisition in Texas. We have seven signed asset purchase agreements pending closing, including the recent addition of an agreement to purchase The wastewater assets in the borough of Shenandoah, Pennsylvania for $12 million. The system serves approximately 3,000 customers. These seven pending transactions plus the one closed transaction will add close to 234,000 customers or customer equivalents and approximately $462.5 million of rate base when closed. We remain confident that we will close the Delcor transaction. I want to make that clear. This is one of the most frequent questions we get. While we continue to wait for the state court to decide on the case, we want to reiterate that we continue to have positive and productive conversations, both internally and externally. We remain focused on closing this transaction and continue to believe that we are the best solution for the operation of the Delcor system, its customers, and our investors. I think it's also important to note and mention to you that our valid and enforceable contract with Delcorra includes a provision that makes the contract valid until 60 days after all litigation is concluded. I think that's an important factor to remember as we continue to pursue the closing of that transaction. Now, in addition to the signed municipal transactions mentioned on the previous slide, we have a healthy pipeline of potential municipal opportunities as we look at the second half of 2021 and beyond. This table includes acquisition opportunities where we are engaged in active discussions with municipalities. As the slide demonstrates, we are actively pursuing approximately 390,000 potential new customers. We continue to believe that fair market value legislation and favorable regulatory environments provide municipalities with the ability to pursue solutions to their infrastructure needs and access industry experience and expertise through companies like ours. So I'll wrap up the call, at least the formal part of the call, with a reaffirmation of our 2021 guidance. And despite the very strong first half of the year, as Dan mentioned, we continue to expect earnings to be between $1.64 to $1.69 a share. Our capital plans remain on track as we anticipate spending approximately a billion dollars on regulated infrastructure this year. The final mix of this capital spending may be more weighted towards the regulated water segment. We anticipate investing nearly three billion across the essential platform by 2023, driving rate-based growth to be 6-7% in water and 8-10% for gas. Customer growth is expected to be between 2-3% on average for our regulated water segment. And finally, we continue to make progress with our ESG targets to ensure the strength of our company is not only measured by our financial performance, but also our commitment to the environmental stewardship, sustainable business practices, employee safety, diversity, and inclusion, customer experience, and community engagement. With that, I'll conclude my formal remarks and open the line for questions.
spk01: If you would like to ask a question, please signal by pressing star 1 on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that is star 1 for questions. And we will take our first question from Ryan Connors with Phoning and Scattering.
spk03: Hey, good morning, Ryan.
spk08: Good morning. Thanks for taking my question, Chris. I wanted to get your take on the noise out there on fair market value, FMV. You know, obviously there are some detractors, which include some of your peers, your smaller peers. There's pretty public debate going on there. So my question is twofold. Number one, do you see any of that having any effect tangible impact legislatively or regulatory-wise in terms of any kind of a rollback of FMV? And then number two, more tactically on discrete deals, do you think that could complicate things if people sort of hold those peer arguments and comments in your face as you try to move deals forward?
spk03: That's a good question. I think there is some noise from some of the smaller companies who maybe have less ability to use fair market value. Having said that, there was a very interesting op-ed in today's – one of the New Jersey publications. I'm happy to share that around, but it was authored by three former public utility commissioners, one from Illinois, one from Pennsylvania, and one from New Jersey – indicating how favorable they view fair market value and how they think it's been a nice step forward for the consolidation of an industry that is, as we all know, balkanized and very fragmented across the country. So I think that although there are different views, I would say the prevailing thought among regulators and legislators, for that matter, is a very positive view of fair market value. So I don't see any rollback either on the regulatory side or on the legislative side. I actually see it picking up momentum as more and more municipals are looking for options to deal with their capital constraints and also the ongoing and probably growing environmental constraints.
spk08: And what about the second part was just on... understood you don't see any real impact legislatively or real tangibly on a regulatory side, but how could that or could not or maybe not impact your individual deals? I mean, is that something you're hearing that stuff come up as you try to move things forward or is that sort of not on the radar of those constituencies and individual deals?
spk03: Yeah, I haven't seen it come up in any of the discussions we've had. Most people don't know that there might be an industry leader out there who's not in favor of fair market value. So it hasn't come up in our discussions. And I think given what I mentioned before with corresponding very positive op-eds and pieces out there, I think we could easily match some of the detractors with probably the more favorable and majority of the people who are saying favorable things in writing.
spk08: Understood. Now, my second one was just staying on the legislative side. The water quality accountability legislation in Pennsylvania, SB 597, we had thought that maybe we would get some movement on that by now, but it looks like that's been pulled back and some of the municipal interest groups are out there sort of claiming victory on that, saying that they're lobbying you know, had the desired effect and got that pulled. What's your response to that? Is that still moving forward? Should we see that move ahead this year, do you think?
spk03: Yeah, I've seen no pullback. In fact, as you're probably aware, it was moved out of the Senate committee. I think there was only one dissenting vote as it moved out of the Senate committee. I think it will continue to be negotiated. This one has enforcement provisions, right? And that's where it all comes down. What we're asking in the Water Quality Accountability Act in Pennsylvania is unbelievably fair, right? Create your replacement cycle, put cybersecurity plans in place. These are all things that, even if they were never to sell their systems, these are things that people should expect of their water systems anywhere in the country, especially anywhere in this country. And so I think the municipals, as you mentioned, or some municipals, as you mentioned, Ryan, will continue to oppose and try to negotiate this. But ultimately, this bill will be a difficult bill for them to stop. And I do think something moves through the legislature before the year is out.
spk08: Got it. Very helpful. Thanks for your time.
spk03: You bet.
spk01: We'll take our next question from Travis Miller with Morningstar.
spk06: Hey, Travis.
spk01: Morning, Travis.
spk06: Hi. I was wondering on that Texas deal, I know it's small, but I wonder if you could elaborate a little bit on the process you went through. Was it smooth? Was it timely? Any points of friction as you went through that, thinking mostly about the first one under the FMV? Any thoughts there on how that went?
spk03: Yeah, I think it took one year, so I would call that relatively smooth in the scheme of things. As you know, the Texas Commission is distracted a bit at this point dealing with the events of last winter, and so I would say relatively smooth process. Okay.
spk06: Does that, I guess, ask in terms of your pipeline, how much in Texas is in your pipeline, or alternatively, how much opportunity do you see in Texas, given that this went smoothly and perhaps gives support to doing more deals?
spk03: Yeah, we don't typically break our pipeline down by state, but I will say that there are a number of opportunities, and I would suggest that even sizable opportunities in Texas that we see and have on our radar there. So it's developing, so I'll concede that it's not galloping at this point, and certainly there is competition in Texas. But I think there's also opportunity that, as you know, once you get one or two of these deals done, others start to take note, especially if the prices are considered to be fair, which I think this one was very fair. Okay. And by the way, and Travis, you should think about this, too. In Texas, fair market value applies also to investor-owned utilities, not just municipals. So it's an interesting twist to the legislation. that we've seen in other states.
spk06: Okay. Okay. Great. No, that's helpful. Thank you. Yep. Good. Yep. Take care.
spk01: We'll take our next question from Jonathan Reeder with Wells Fargo.
spk07: Hey, Jonathan. Hey, good morning, Chris. Hey, Dan. Hey, just wondering what the latest is on the Pennsylvania commissioner appointments. You know, I thought last we spoke, you said that there might've been some sort of kind of, two-for-one deal between the governor and the Senate Republicans. Anything more on that front?
spk03: Yeah, I guess it would be more informal than anything. I guess what we know as fact, right, there are four seated commissioners currently. Commissioner Sweet's term ended on April 1st of this year, and then he's required to vacate the seat on October 1st. So, If nothing else changes between now and the 1st of October, which we don't anticipate, the legislature doesn't even go back until the second week in September. So we would anticipate then on October 1st, Commissioner Sweet would step down, and then the commission would be two Republicans, that's Commissioner Yanora and Commissioner Coleman, and one Democrat, the chairman. And so you would be a two-to-one Republican majority, which is really unheard of to be down to three commissioners and have the majority flip. And, listen, this is informal now, the rest of this, but the debate appears to be framed around the regional greenhouse gas initiative, right, the REGI. And the governor is intent on staying as a part of REGI, and the – Pennsylvania Senate has said we're not going to appoint any new commissioners as long as that's the case. And so that's a bit of a stalemate. How that ends up being negotiated out, I don't know. But certainly the chatter in the state capitol is that we could end up finishing this year with that two-to-one Republican majority. But time will tell.
spk07: Okay. And if there is that two-to-one, I mean, do you think they're prepared to still act on – your pending Del Cora application in some form or fashion, whether it's conditioned on the appellate court process or whatever?
spk03: Well, I can't say for certain what they're going to act on, but what I can say is they are empowered to continue to do the business of the commission. In other words, they don't need a full commission, seated commission, in order to continue to complete the business of the PUC. whatever comes before them, they do have the power to act on.
spk07: Got it. Any updated thoughts on the timing of the solution of the court appeal?
spk03: Yeah, I mean, we're saying 2022 now, Jonathan. The Pennsylvania State Court or Commonwealth Court You know, that just takes time as we grind through the process. And so I would think that that would be the case. I mean, just a little bit of color on this. You know, there is an election in Delaware County. Two of the seated commissioners or councilmen, as they call them in Delaware County, are up for election. One of them is not running again. He was the chairman, Mr. Zydek. And so he'll be replaced absolutely. Absolutely. And then there's another commissioner or councilman named Madden who's also up. So there could be a change in the makeup of Delaware County Council. There will absolutely be a makeup, at least a change in one seat, maybe two, when we come into January. And they're seated immediately in January. It's like January 3rd or something. So, you know, we will see some change there. Might there be an opportunity with a new look and a new set of council people to find a settlement? You never know.
spk07: Okay, but if the court has to fully play out, I mean, it's somewhere in 2022 or kind of earlier in the year.
spk03: It's really hard to put a gauge on how quickly the Commonwealth Court will move. We said, you know, maybe in that six-month time frame, so could that be by mid-year? I don't want anybody putting numbers on it because it's just hard to tell how quickly the court will move.
spk07: Okay, gotcha. No, that's fair enough. And then, Dan, I think you said, you know, you still – you haven't filed the PA water rate case. Did you indicate how soon that's going to be filed or, like, what kind of timing we should think of?
spk04: Yeah, Jonathan, think of that just, you know, in the coming weeks it'll be filed. It'll be filed later this month, which keeps us on that three-year cadence that we've talked about.
spk07: Perfect. Okay, so weeks, yeah.
spk04: Yeah. Okay, great.
spk07: Thanks so much for taking my questions. All right. Yep. Thanks, Jonathan. Take care. I was going to say, yeah, thanks so much, and great color on the second half of the year. I mean, that eliminated, I think, a lot of the questions we had, so that was perfect. Appreciate you anticipating that. Good. Thank you.
spk01: We're going to take our next question from Verity Mitchell with HSBC.
spk05: Hi, Verity.
spk00: Hey, Verity. Morning. Morning, everybody. I've just got two questions. One is about the gas customer count being stable for 2021. I mean, is that in line with your expectations, or do you want to give us a bit more color on that? And then the second question is, as I'm not local, if you want to give us a feel for what the weather's been like in July and August, because clearly I wouldn't know where I'm calling from. Thank you.
spk04: Yeah, so gas customer count will be relatively stable year on year. You know, it's interesting. We tend to pick up a few customers with new connections, but we lose a few customers as well. So that business is pretty close to stable, whereas, you know, in several of the water states, we continue to add on the organic side growth. tends to be in Pennsylvania, North Carolina, Texas, the places that you would imagine that there's building going on. In terms of the weather, I would say it kind of differs by part of the country. Generally, it's been pretty nice, but we have seen spots with some more rain. Texas had kind of a rainy start of the summer, and it started in the kind of mid-July time frame to warm up and cool. We're seeing the hot weather again in Texas. We've had a bit of rain here in Pennsylvania on and off. We're just getting the July numbers in here and taking a look at it. That's probably the color I can give at this point. Chris, any further color on it?
spk03: I think that's right. You know, Verity, and particularly in this area where we have a lot of water customers in Pennsylvania, you want the summer to be dry but not too dry that people give up on their grass.
spk04: Right.
spk03: And so I think that's where we are right now. People continue to water. You know, we're thinking it's looking pretty normal, but, you know, we'll see what the next couple weeks bring. They're predicting here in Philadelphia on the morning news today that we could get our fifth heat wave of the season. You know, I guess that's five days in the 90s coming up this week. So maybe we'll sell some water.
spk04: Great. Thank you. Yep. Thanks, Verity.
spk01: As a reminder, if you would like to ask a question, please press star 1. We will take our next question from Ben Callow with RW Baird.
spk02: Hey, guys. Hey, Ben. Good to talk to you. I hope you're doing well. Maybe just, you know, on the biz dev front – You know, there was a flurry of military bases, and I haven't seen one. Maybe I've missed it lately. Can you talk to that? And then just maybe more on, you know, I saw the Texas announcement, and, you know, I've seen some other movement there. Can you just talk about the Texas market and, you know, how appealing that is to you versus all the other stuff on your plate? Thank you.
spk03: Yeah, on the military front, as you know, we haven't played there. That really hasn't been – we've been largely focused on municipal market, which is very open in the states where we are. And I haven't seen much on military of late, although I do know that there continue to be some opportunities, you know, moving forward. But we've just not played there. I guess then focusing on Texas, listen, we're always high on Texas. When you look at the population numbers alone in Texas, you'd say, boy, the growth in population should then show some growth in housing starts and then obviously be more water sales and on and on. We've been very active there. We've got a very active state team and very active in the legislative front, as you know, on the fair market value. And so we're optimistic about Texas, but I think we're at the opening stages for municipal. But as we just reminded everyone a minute ago, the new fair market value legislation in Texas applies not only to municipals, but also to investor-owned. So the market's pretty wide open there, and it's a matter of continuing to till the soil and really opening that market now that we have the legislation we need.
spk02: Great. And then on the ESG front, could you just talk about maybe if there is a interaction between your ESG profile and your local utility commissions yet, or how that works, how they look at that, or if it hasn't evolved to that yet. Thank you.
spk03: Sure. I think there are aspects of ESG, call it diversity, equity, and inclusion, certainly greenhouse gas emissions, environmental emissions, They don't always call it ESG, but certainly the elements are there, and those are widely discussed as we talk with regulators. But I do think that the overall ESG platform is here to stay, and I think it will continue to be a topic with not only investors but regulators. The interest level, as I said, though, seems to be forming up more around individual issues as opposed to, you know, the overall ESG. And I'll point to renewable natural gas, you know, and how those, you know, if we were to go there, how those costs might be recovered. Other utilities have already begun to test mechanisms, and we're watching those very carefully. So as we think about environmental, the environmental aspect of ESG, I think that's where it will form up for us, at least on the gas side.
spk04: And then, Chris, maybe the other place would just be customer assistance programs.
spk03: Yeah, good point.
spk04: Definitely an overlap there.
spk03: Yep, yep, yep. And we're doing a lot of work around customer assistance, particularly in Pennsylvania right now.
spk02: Okay, that's helpful. Thank you, guys. Congrats. Yeah, thanks, Ben.
spk01: It appears there are no further questions at this time. I would like to turn the conference back to Mr. Chris Franklin for any additional or closing remarks.
spk03: Great, thank you. Dan, Brian, and I are always available for follow-up questions if there are any. But in the meantime, thank you for joining us and appreciate the questions and your attention. Be well.
spk01: And that concludes today's presentation. Thank you for your participation. You may now disconnect.
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