53 rd Edison Electric Institute Financial Conference. (November 11 13, 2018)

Transcription

1 53 rd Edison Electric Institute Financial Conference (November 11 13, 2018)

2 Caution regarding forward-looking statements and Regulation G compliance 1 In this presentation, and from time to time, Entergy Corporation makes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of Such forward-looking statements include, among other things, Entergy s 2018 earnings guidance, its current operational outlook, and other statements of Entergy s plans, beliefs or expectations included in this presentation. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this presentation. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this presentation and in Entergy s most recent Annual Report on Form 10-K, any subsequent Quarterly Reports on Form 10-Q and Entergy s other reports and filings made under the Securities Exchange Act of 1934; (b) uncertainties associated with (1) rate proceedings, formula rate plans and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities and (2) implementation of the ratemaking effects of changes in law; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear plant relicensing, operating and regulatory costs and risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning Entergy s nuclear plant sites; (f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with strategic transactions that Entergy or its subsidiaries may undertake, including the risk that any such transaction may not be completed as and when expected and the risk that the anticipated benefits of the transaction may not be realized; (h) effects of changes in federal, state or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental or energy policies; and (i) the effects of technological changes and changes in commodity markets, capital markets or economic conditions, during the periods covered by the forward-looking statements. This presentation includes the non-gaap financial measures of UP&O Adjusted EPS; normalized ROE; parent debt to total debt, excluding securitization debt; operational FFO to debt, excluding securitization debt; and operational FFO to debt excluding securitization debt and return of unprotected excess ADIT when describing Entergy s results of operations and financial performance. We have prepared reconciliations of these financial measures to the most directly comparable GAAP measure, which can be found in the appendix of this presentation. Further information can be found in Entergy s investor earnings releases, which are posted on our website at

3 We Power Life 2 Customers Employees Communities Owners Deliver Earn top-quartile Achieve Deliver top-quartile organizational top-decile top-quartile customer health score corporate social returns satisfaction and top-decile responsibility safety performance performance

4 Our financial objective 3 Steady, predictable growth at the Utility Earnings growth at our Utility, Parent & Other segment Dividend growth while managing risk Customer-centric capital plan Progressive regulatory constructs Disciplined project management Orderly wind-down of EWC

5 Strategic execution over the past few years 4 EWC wind-down Decisions to close or sell merchant nuclear plants FitzPatrick sale Agreements to sell VY, Pilgrim and Palisades IPEC license renewal Revenue price risk reduction Focus on nuclear operations Employee support Investing in the Utility $13B capital investment over the last five years Major generation projects approved Transmission expansion Joined MISO Dec MTEP 15, 16 and 17 completed AMI under way Constructive regulation Arkansas legislation / E-AR forward test year FRP E-LA FRP improvements E-LA business combination E-MS FRP with forwardlooking features E-TX DCRF and TCRF System Agreement termination

6 Finishing strong at EWC 5 FitzPatrick Vermont Yankee Pilgrim Indian Point Palisades Sold (2017) Shutdown (2014) Planned shutdown (2019) Planned shutdown (2020 / 2021) Planned shutdown (2022) Agreement to sell (targeted 2018) Agreement to sell (targeted 2019) IP2 in final operating cycle Agreement to sell (targeted 2022)

7 EWC risk reduction efforts 6 Revenue price risk reduction Operational focus 87% reduction Jan 17 Sep 18 Employee support Decommissioning Agreements to sell Vermont Yankee, Pilgrim and Palisades

8 Projected Utility rate base 7 Projected rate base 1 ; $B E 19E 20E 21E 1 Internal estimates based on last-approved rate base adjusted for assumed changes in the major rate base components and includes CWIP; deferred taxes are deducted from rate base for all OpCos, including E-AR

9 A clear and robust Utility 2019E 2021E capital plan ~85% ready for execution from a regulatory approval standpoint 8 Power generation $3.0B $11.1B Nuclear $1.5B Transmission $2.3B Distribution and utility support $4.3B

10 Generation capital plan 9 Preliminary generation capital plan; cumulative $B E 19E 20E 21E Nuclear Non-nuclear baseline New generation Renewables

11 Transmission capital plan 10 Preliminary transmission capital plan; cumulative $B E 19E 20E 21E Asset management Reliability and growth Economic

12 Distribution and utility support capital plan 11 Preliminary distribution and utility support capital plan; cumulative $B E 19E 20E 21E Distribution baseline Utility support Grid modernization

13 12 Grid modernization Next few years, primarily AMI Highlights of AMI Latest generation meters One of the fastest networks Enhanced information Tools for tailored customer solutions Improved operational efficiency

14 Low customer rates Goal to maintain rate advantage average retail price by parent company; per kwh ETR 7.58 Source: S&P Global Market Intelligence Regulated Retail Price of Electricity published 7/19/18

15 14 Managing customer bills Average monthly residential bill; $ Illustrative Levers to help control bills Nonfuel Fuel <2% CAGR Fuel efficiency Operational savings Energy efficiency Industrial growth Securitizations rolling off 17 18E 19E 20E 21E ETR bill outlook Without return of unprotected excess ADIT New products and services

16 Progressive cost recovery mechanisms ~90% of capital plan recovered through timely mechanisms 15 Capital plan recovery by mechanism Illustrative Rate Rate case cases Traditional FRPs Riders Forward-looking FRPs Chart reflects preliminary 2019E 2021E capital investment, not rate base; capital projects will be reflected in rate base when they are closed to plant; for multi-year projects there will be a timing difference

17 Investment plan benefits our stakeholders 16 Enhanced reliability and resiliency Good-paying jobs/ Workforce development Catalyst for our region s economic development Production cost savings Reduced environmental footprint at the Utility Greater customer control and options over energy usage Maintain reasonable rates Enablers of tomorrow s customer solutions

18 Supporting environmental stewardship 17 Positioned to operate in a carbon-constrained economy One of the cleanest large generating fleets in the U.S. Environment 2020 : Voluntary pledge to reduce CO 2 emissions 20% below year 2000 levels through 2020 ~1,000 MW of renewables in various stages of development Meeting objectives through Portfolio transformation Investment in nuclear fleet New technologies Renewables and distributed energy resources Planning to prepare and publish a two-degree scenario analysis

19 Dividend growth from UP&O earnings 18 UP&O adjusted EPS 1 ; $ Actual dividend E guidance As-reported E outlook 20E outlook 21E outlook 1 Excludes special items and normalizes weather and income taxes; see slide 55 in appendix for Regulation G reconciliation : 4.60 Utility + (1.00) Parent & Other; 2015: 6.12 Utility + (1.15) Parent & Other; 2016: 6.34 Utility + (1.24) Parent & Other; 2017: 4.22 Utility + (0.97) Parent & Other

20 Credit profile 19 Parent debt to total debt 1 ; % 24.5 Target < 25% FFO to debt 1 ; % Excluding return of unprotected excess ADIT Target 15% 3Q18 18E 22E 3Q18 20E 22E Credit ratings 3 (outlook) S&P Moody s E-AR E-LA E-MS E-NO E-TX SERI ETR A (stable) A2 (stable) A (stable) A2 (stable) A (stable) A2 (stable) A (stable) Baa2 (stable) A (stable) Baa1 (stable) A (stable) Baa1 (stable) BBB+ (stable) Baa2 (stable) 1 Excluding securitization debt; see appendix for Regulation G reconciliation 2 Excluding securitization debt and return of unprotected excess ADIT; see appendix for Regulation G reconciliation 3 Senior secured ratings for the OpCos and SERI; corporate credit rating for Entergy

21 Evolving customer expectations 20 Outcomes not inputs Save money New technology Green Ease of use

22 Shifting from supplier to partner 21 From supplier To partner

23 Delivering tailored customer solutions Technology advances make it possible 22

24 Thinking of each customer as a segment of one A different mindset to deliver value 23 Industrial A segment of Commercial ONE Residential

25 Strategic investments to further our journey Building an integrated energy network 24 Grid infrastructure replacements / upgrades Enabling technologies Distributed resources Generation Distribution Customer Transmission

26 Uniquely positioned to seize growth opportunities 25 Track record of successful execution Efficient vertical integration Low rates Efficient regulatory frameworks Clean generation Environmental and social responsibility Economic development Prepared for change

27 26 Appendix and Regulation G reconciliations

28 2017 electric retail sales 1 ; % Industrial Governmental generation portfolio 2 ; % Nuclear Coal Commercial 30 Residential CT/CCGT/ hydro/solar Legacy gas/ oil Utility overview E-MS Electric utility 449,000 customers Electric utility Authorized ROE range: 9.28% 11.36% 709,000 customers FRP with forward-looking features E-AR Authorized ROE range: 9.25% 10.25% Forward test year FRP Electric and gas utility Number of customers Electric 200,000 Gas 106,000 Note: Customer counts at the end of period 12/31/17 1 Percent of 2017 weather-adjusted GWh electric retail sales 2 Percent of owned and leased MW capability for generation portfolio as of 12/31/17 Electric and gas utility Number of customers Electric 1,078,000 Gas 93,000 Authorized ROE ranges: Electric 10.7% 11.5% Gas 10.25% 11.25% Rate case E-NO E-LA Authorized ROE ranges: Electric 9.95% (2017 test year); 9.2% 10.4% ( test years) Gas 9.45% 10.45% Electric FRP, gas RSP Electric utility 448,000 customers Authorized ROE: 9.65% Rate case E-TX 27

29 LTM 9/30/18 ROE; % Entergy Arkansas E-AR (currently in rates) Metric Detail Authorized ROE 9.25% 10.25% Rate base $7.095B retail rate base (2018 test year) WACC (after-tax) 4.67% Equity ratio 31.69% (45.48% excluding $2.2B of ADIT 2 at 0% cost rate) Regulatory construct Forward test year FRP ( annual test years); result outside authorized ROE range resets to midpoint; maximum rate change 4% of filing year total retail revenue; true-up of projection to actuals netted with future projection Last rate change $71M increase effective 1/2/ As-reported Normalized 1 Riders MISO, capacity costs, Grand Gulf, tax adjustment, energy efficiency, fuel and purchased power 1 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 2 The $2.2B of ADIT reflects the pre tax reform federal tax rate (35%); will continue to reflect that amount in its cost of capital calculation by including the regulatory liability for the excess ADIT until the value of the excess ADIT has been refunded to customers

30 Entergy Arkansas 29 Annual FRP filing in process partial settlement filed 10/30 Settlement highlights/2018 evaluation report (docket FR) Filing highlights 2019 test year 2017 test year true-up Earned ROE 7.89% 4.93% Retail rate base (ADIT incl. in WACC, not rate base) $7.547B $6.621B WACC (after-tax) 5.25% 4.61% Equity ratio (traditional equity ratio) 36.55% (46.38% excl. $1.7B ADIT at 0% cost rate) 31.46% (43.57% excl. $2.0B ADIT at 0% cost rate) Revenue requirements to midpoint $69.2M $93.7M Rate change requested $66.7M (cap) Major components of revenue requirement; $M Category 2019 TY 2017 TY Cost of capital 27 6 Expense items (29) 30 Key dates Date Event 12/13/18 Requested decision 1/2/19 Requested rate adjustment Rate base 50 2 Revenue/sales shortfall Other 3 (18) Total Calculations may differ due to rounding

31 LTM 9/30/18 ROE; % As-reported Normalized 5 Entergy Louisiana E-LA (currently in rates) Metric Detail electric 1 Detail gas Authorized ROE 9.95% % 10.45% Last filed rate base $9.7B excl. $520M transmission plant through 8/31/18, included in the transmission rider (12/31/17 test year) $0.0645B, filed on 4/16/18 (9/30/17 test year) WACC 7.23% (after-tax) 7.25% (after-tax) Equity ratio 49.1% 49.53% Regulatory construct FRP, test years; 60/40 customer/company sharing outside bandwidth RSP 3 Last rate change Net base rate reduction $(18M) 4 $0.85M decrease (largely tax) Riders/specific recovery Capacity, MISO, transmission, fuel Gas infrastructure 30 1 Pending finalization of the 2017 test year filing (docket U-34951) and 2019 test years will have an authorized ROE range of 9.2% 10.4% (9.8% midpoint) 3 50 bps dead band, 51 bps 200 bps 50% sharing, >200 bps adjust to 200 bps plus 75 bps sharing; for infrastructure costs, 100% sharing above the band 4 Includes the following components: $60M cost of service, $37M MISO/capacity/other and $(115M) annualized tax reform mechanism 5 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments

32 Entergy Mississippi 31 LTM 9/30/18 ROE; % As-reported Normalized 1 E-MS (currently in rates) Metric Detail Authorized 10.32% performance-adjusted midpoint (9.69% ROE % performance factor); 9.28% 11.36% range (annual redetermination based on formula) Rate base $2.413B (2018 forward test year) WACC 7.13% (after-tax) Equity ratio 48.05% Regulatory FRP with forward-looking features; annual construct redetermination subject to performance-based bandwidth calculation and subject to annual look-back evaluation; maximum rate increase 4% of test year retail revenue (higher rate increase requires filing of a general rate case) Rate change None requested in 2018 FRP filing Riders 2 Power management rider, Grand Gulf, fuel, MISO, unit power cost, storm damage, energy efficiency, ad valorem tax adjustment 1 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 2 EMI is seeking a new rider for the cost of Choctaw Generating Station and other new owned capacity

33 Entergy New Orleans 32 E-NO (currently in rates) Metric Detail electric Detail gas Authorized ROE 10.7% 11.5% 10.25% 11.25% Rate base (filed on 5/31/12) 1 $0.299B (12/31/11 test year) does $0.089B (12/31/11 test not include $0.228B year) for Union (first year average rate base) WACC (after-tax) 8.58% 8.40% LTM 9/30/18 ROE; % Equity ratio 50.08% 50.08% Regulatory construct Rate case Rate case Riders/specific recovery Fuel, capacity (e.g., Ninemile 6, Union) Purchased gas As-reported Normalized 2 1 Electric rate base does not include Algiers assets transferred to E-NO from E-LA on 9/1/15; net book value of the assets at the time of the transfer was ~$85M 2 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments

34 Entergy New Orleans Base rate case filing Base rate case (docket UD-18-07) Highlights ROE: earned 8.73%, requested 10.50% (electric), 10.75% (gas) Rate base: $0.9B (12/31/18 test year with known and measurable plant closings through 12/31/19) WACC (after-tax): 7.79% (electric), 7.92% (gas) Equity ratio: 52.2% 21% federal tax rate incorporated as a known and measurable change Requested mechanisms: Electric and gas FRPs ( test years), electric with ±25 bps reliability performance adj. Riders for gas infrastructure, grid modernization, incremental capacity and LTSA Also includes community solar, green pricing options and other new customer offerings Major drivers of proposed rate change (31) Category $M AMI 8 Rate base 8 Depreciation expense 7 Other O&M (3) Income tax expense (5) Other revenue changes (4) Base rate change (net of 10 realignment from riders) 2019 projected fuel savings and energy efficiency Net rate change (20) Key dates (tentative) Date Event 6/10 14/19 Hearing (tentative) Aug Rate effective date 33 Calculations may differ due to rounding

35 Entergy Texas 34 E-TX (currently in rates) 1 Metric Detail Authorized ROE 9.65% Rate base $2.446B (12/31/17 test year) LTM 9/30/18 ROE; % WACC (after-tax) 7.73% Equity ratio 50.9% Regulatory Rate case construct Last rate changes $53M net base rate change; $(122M) tax riders (first year rate impact) Riders Fuel, capacity, DCRF, TCRF, rate case expenses, AMI surcharge, Limited- Term Tax Cuts and Jobs Act, Federal Income Tax, among others As-reported Normalized 2 1 Pending finalization of the 2017 test year settlement (docket 48371) 2 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments

36 Base rate case PUCT docket On 10/5/18, E-TX filed an unopposed settlement in its base rate case Highlights Proposed ROE: 9.65% Rate base: $2.446B (12/31/17 test year) WACC (after-tax): 7.73% Equity ratio: 50.9% New rates to reflect 21% federal tax rate Tax riders Return $204M 1 of unprotected excess ADIT (over 12 months or four years depending on class) Return $25M for tax rate change benefits from 1/25/18 through rate effective date Entergy Texas Base rate case filing Summary of settlement rate change Annual Category $M Base rate change 101 Roll riders into base rates (48) Net base rate change 53 Tax riders 2 ~(122) Net rate change (69) Key dates Date Event 12/7/18 Upcoming PUCT Open Meeting dates (potential agenda item to consider 12/20/18 settlement) 35 1 Includes $19M carrying costs 2 First year rate impact

37 System Energy Resources, Inc. 36 Grand Gulf Nuclear Station SERI generation company Metric Detail Principal asset An ownership and leasehold interest in Grand Gulf Authorized ROE 10.94% 1 Last calculated rate $1.458B (9/30/18) base WACC (after-tax) 8.89% Equity ratio 65% 2 Regulatory construct Monthly cost of service Energy and capacity allocation 3 ; % E-NO 17 E-AR 36 E-MS E-LA 1 Ongoing proceeding at FERC challenging SERI s authorized ROE (see slide 37) 2 Sale leaseback obligation excluded from capital structure, treated as an operating lease and recovered as an O&M cost 3 Reflects percentages under SERI s Unit Power Sales Agreement

38 System Energy Resources, Inc. 37 FERC proceedings (1 of 2) APSC/MPSC ROE complaint (docket EL17-41) 1/23/17 Complaint alleging SERI s ROE is unjust and unreasonable; APSC/MPSC argue for an ROE range of 8.37% to 8.67% 9/29/17 FERC order setting the matter for hearing and settlement; refund effective date 1/23/17 1 6/18/18 SERI filing indicated that parties were unable to settle ROE issue LPSC ROE complaint (docket EL18-142) 4/27/18 Complaint alleging SERI s ROE is unjust and unreasonable; LPSC argues for 7.08% ROE; LPSC also requests that SERI s equity component be capped at 49% for ratemaking (see docket EL on next slide) 8/24/18 FERC order setting ROE issue for hearing and settlement; refund effective date 4/27/18 7/26/18 Hearing judge appointed 8/29/18 Chief ALJ order consolidating ROE complaints; set for hearing 10/17/18 Chief ALJ order holding procedural schedule in abeyance in light of FERC ROE order on New England transmission owners Key dates Procedural schedule held in abeyance 1 FERC initially consolidated the APSC/MPSC ROE complaint with SERI s depreciation and decommissioning filing (docket ER ); parties subsequently reached a settlement on the depreciation and decommissioning issues which FERC approved on 8/24/18

39 System Energy Resources, Inc. FERC proceedings (2 of 2) 38 LPSC complaint regarding GGNS sale-leaseback renewal (docket EL18-152) 5/14/18 Complaint alleging (1) SERI was imprudent in renewing the sale-leaseback, (2) SERI violated the filed rate when it included the cost of capital additions associated with the sale-leaseback interest in UPSA billings and (3) SERI is double-recovering costs by including both the lease payments and the capital additions in UPSA billings 6/28/18 SERI motion to dismiss and answer in opposition to the LPSC s claims 9/20/18 FERC order setting LPSC sale-leaseback complaint for hearing and settlement 9/28/18 Settlement judge assigned Next steps First settlement conference on 11/15/18 LPSC complaint regarding SERI equity component (docket EL18-204) In its 4/27/18 ROE complaint (docket EL ), the LPSC also requested that SERI s equity component be capped at 49% for ratemaking 8/24/18 FERC order dismissing LPSC request for cap on equity component 9/25/18 LPSC request for rehearing regarding cap on equity component and amended LPSC complaint on equity component 10/15/18 SERI answer and motion to dismiss amended complaint

40 Retail filings summary Key milestones Retail filings on tax reform OpCo Docket Lower federal tax rate in rates Return of unprotected excess ADIT 1 E-AR FR/ Tax rate change as part of the 2018 $466M returned to customers ($360M in TF test year true-up , remainder in 2019) E-LA U In base rates effective 9/1/18 including return of benefit for Jan Aug 2018 $212M returned to customers (~half in 2018, remainder ) E-MS 2014-UN-132 Reflected in 2018 FRP $162M ($26M returned to customers in 3Q18, $135M to recover rate base items) E-NO Assume base rates effective Aug 2019; reg. liability for Jan 2018 Aug 2019 benefit ($7M over high-bill months, $7M Energy Smart, $1M grid modernization) E-TX $25M in total customer credits ($11M to large customers over ten months, remainder to other customers over four years) $35M ($14M returned to customers, $12M grid modernization funding, $6M Energy Smart, $3M Smart City pilot) $204M 3 returned to customers ($75M to large customers over 12 months, remainder to other customers over four years) E-AR E-AR Event ( FR) ( TF) E-LA E-MS E-NO E-TX Initial filing 3Q18 2/27/18 4/12/18 3/15/18 3/26/18 5/15/18 Decision/guidance 4Q18 Approved 3/27/18 Approved 4/18/18 Approved 6/5/18 6/21/18 4Q Represents grossed up amounts 2 See also APSC docket U, the generic investigation docket for tax reform issues 3 Includes $19M carrying costs

41 Jurisdictional rate filing guidelines 40 E-AR E-LA E-MS E-NO E-TX SERI Latest filing FRP filed 7/6/18 FRP filed 6/30/18 FRP filed 3/15/18 Next filing date Rate effective date Evaluation period FRP term/ post FRP framework FRP: July 2019 FRP: by 5/31/19 FRP: by 3/15/19 January following filing Forward test year ended 12/31 FRP: 5 years ( test years); option to request FRP extension, file rate case or do nothing September following filing Historical test year ended 12/31 except new generation and transmission closed to plant above baseline through 8/31 of filing year FRP: 3 years ( test years) June following filing Historical test year ended 12/31 plus certain items from forward test year ended 12/31 FRP: no stated term; review scheduled in 2019 Rate case filed 9/21/ rate case filed 5/15/18 Monthly cost of service calculation 1 FRP: in 2019 (proposed) TBD Every month 1 year + 35 days after Immediate 15 days after filing 2 filing Historical and forecasted test years ended 12/31 FRP: 3 years ( test years) (proposed) 12-month historical test year with available updates n/a Actual current month expense and prior monthend balance sheet Monthly cost of service continues until terminated by mutual agreement 1 Not required to be filed per FERC order 2 May be suspended for an additional 150 days

42 Generation projects 41 Project Location OpCo MW St. Charles Power Station New Orleans Power Station Lake Charles Power Station Montgomery County Power Station Washington Parish Energy Center Choctaw Generating Station Montz, LA New Orleans, LA Westlake, LA Willis, TX Bogalusa, LA French Camp, MS E-LA E-NO E-LA E-TX E-LA E-MS ~980 CCGT Estimated cost Estimated in service 1 Includes transmission interconnection and other related costs 2 Council approval is on appeal and is being challenged in a lawsuit alleging violations of the Open Meetings Law 3 Includes planned improvements 4 E-MS estimated acquisition date; original in service date 2003 Status $869M Under construction ~128 RICE $210M ~994 CCGT ~993 CCGT ~361 CT ~810 CCGT Issued notice to proceed 2 $872M Under construction $937M Under construction $261M Received regulatory approval $401M Filed for regulatory approval

43 E-MS Choctaw Generating Station 42 Project overview (docket 2018-UA-204) Item Details MW ~810 (summer rating) Estimated total investment $401M 1 Plant type CCGT Location French Camp, MS In-service date 2003 (existing facility) Closing date Targeting 4Q19 Recovery mechanism Proposing FRP adjustment outside of sharing, to begin contemporaneously with closing, and to be rolled into annual FRP reviews after a full calendar year of ownership Status Filed for regulatory approval 1 Includes planned improvements

44 EWC overview 43 Region breakdown; % MW as of 12/31/17 MISO NEPOOL Generation portfolio; % MW as of 12/31/17 Other Gas and oil Nuclear NYISO 52 EWC nuclear plants Planned closing date Indian Point 1 Shut down Indian Point 2 Indian Point 3 Palisades Pilgrim VY 4/30/20 4/30/21 5/31/22 5/31/19 Shut down Net MW n/a 1,028 1, n/a Energy market n/a NYISO NYISO MISO NEPOOL n/a (closest hubs) (Zone G) (Zone G) (Indiana) (Mass Hub) Net book value of plant and related assets (9/30/18) $100M $131M $143M $18M NDT bal. (9/30/18) $509M $644M $835M $476M $1,081M $554M ARO liability bal. $226M $753M $737M $538M 2 $806M $289M (9/30/18) 1 EWC non-nuclear plants ISES 2 Nelson 6 RS Cogen COD Fuel / technology Coal Coal CCGT cogen Net MW owned Market MISO MISO MISO 1 ARO liability balances are based on most recent estimates and are subject to change 2 Includes $39M for Big Rock Point

45 Vermont Yankee transaction 44 Transaction highlights Item Details Structure Equity sale of ENVY Purchaser NorthStar Decommissioning Holdings, LLC Transaction close Conditions to close include Targeted by year-end Regulatory approvals: VPUC certificate of public good; NRC license transfer approval Minimum NDT balance Spent fuel in independent spent fuel storage installation Status Transfer of all spent fuel to ISFSI completed on 8/1/18 NRC approved license transfer application and NorthStar s exemption request to use up to $20M of NDT funds at any one time for spent fuel management activities on 10/11/18 VPUC fully briefed, including settlement agreement addressing financial assurances and site restoration standards; certificate of public good decision pending; parties agreed to further extend settlement agreement to 11/30/18 Next steps VPUC NRC Docket LT-2 Decision Targeted 4Q18 Approved October Timing of regulatory decisions could impact transaction closing

46 Pilgrim and Palisades transactions 45 Transaction highlights Item Pilgrim Palisades Structure Equity sale of ENGC Equity sale of ENP Purchaser Nuclear Asset Management Co., LLC (Holtec International subsidiary) Nuclear Asset Management Co., LLC (Holtec International subsidiary) Conditions to close include Status Targeted timeline Permanent shutdown and reactor defuel NRC approval FERC approval (switchyard change of control) Minimum NDT balance Palisades agreement has not been terminated due to breach by purchaser Permanent shutdown and reactor defuel NRC approval Minimum NDT balance Pilgrim transaction close Executed purchase and sale agreement Executed purchase and sale agreement Pilgrim Palisades NRC filing 4Q18 TBD FERC filing TBD n/a Targeted close By the end of 2019 By the end of 2022

47 2018 EPS guidance EPS guidance 1 ; $ (7.00 midpoint) (4.70 midpoint) Entergy consolidated operational Increased 10/31/18 to reflect weather and tax items better than plan, net of NDT returns lower than plan Utility, Parent & Other adjusted Current expectations around the midpoint 2 1 The company has not provided a reconciliation of non-gaap guidance to guidance presented on a GAAP basis because it cannot predict and quantify with a reasonable degree of confidence all of the special items that may occur during For those anticipated special items that the company can reasonably estimate at this time, see slide 53 2 Excludes special items and normalizes weather and income taxes

48 Utility, Parent & Other financial outlook 47 UP&O adjusted EPS 1 ; $ E guidance 19E outlook 20E outlook 21E outlook 1 Excludes special items and normalizes weather and income taxes

49 Preliminary Utility capital plan 48 Preliminary 2019E 2021E Utility Capital Plan; $M Function E-AR E-LA E-MS E-NO E-TX SERI ESI/EOI Utility Generation 955 1, ,495 Transmission 310 1, ,335 Distribution 715 1, ,075 Utility Support ,195 Total Capital Investment 2,265 4,055 1, , ,100 Total Depreciation Expense , n/a 4,480 1 Depreciation for ESI is allocated to each OpCo

50 Preliminary view of 2019 UP&O Adjusted EPS drivers 49 UP&O Adjusted EPS 1 ; $ Illustrative Regulatory actions Depreciation Other tax Net interest AFUDC Settlement of equity forwards NFOM Other guidance midpoint Net revenue Capital investment Dilution Other 2019 outlook midpoint 1 Excludes special items and normalizes weather and income taxes

51 Category UP&O 2019 key drivers and assumptions Considerations Sales Growth Preliminary weather-adjusted sales growth estimate based on actuals through 9/30/18 ~0.5% to 1.0%, driven by industrial sales, partially offset by lower residential and commercial sales YTD 3Q18 weather = $0.23/share Retail Price Full year of 2018 rate actions: E-LA FRP (effective 9/18); E-TX rate case (effective 10/18) Pending filings: E-AR FRP, E-NO rate case Expected 2019 filings: E-MS and E-LA FRPs St. Charles Power Station in rates Utility Non-Fuel O&M 2019E ~$2.7B (including RFO), slight increase year-over-year Pension discount rate currently assumed at 4.25% 50 Utility Investment Effects Depreciation expense expected to increase with continued investment Average depreciation rate ~2.6% Net interest expense expected to be higher, mostly offset by AFUDC Utility Book ROE Expected in the mid-9% range P&O Expected relatively flat year-over-year Share Count ~195 million shares

52 Preliminary EWC capital plan 51 Preliminary EWC Capital Plan; $M 18E 19E 20E 21E 22E Pilgrim Indian Point Expected to be impaired as incurred and classified as a special item Palisades/other Total EWC Capital Estimated depreciation expense

53 EWC operational adjusted EBITDA outlook Reflects 9/30/18 market prices 52 EWC operational adjusted EBITDA; $M (5) 18E 19E 20E 21E 22E Net revenue 1,300 1, Non-fuel O&M (730) (670) (505) (345) (135) Other (125) (125) (90) (50) (25) Total (5) 6/30/

54 Estimated special items 53 Estimated special items; pre-tax $M 18E 19E 20E 21E 22E Asset impairments (capital) (105) (65) (15) (15) - Asset impairments (fuel, refuel/defuel, other) (255) (85) (25) (10) (10) Severance and retention (155) (110) (60) (30) (15) Net gain/(loss) on sale of assets 1 (165) (120) Total (680) (380) (100) (55) 50 Estimated special items, EPS (2.95) Note: The table above reflects estimates for expected special items resulting from decisions to close or sell EWC nuclear plants. Other special items may occur during the periods presented, the impact of which cannot reasonably be estimated at this time. 1 Net loss or gain on sale of assets represents our current estimates, which are subject to change. The primary variables in the ultimate loss or gain are the values of the NDTs and the asset retirement obligations, financial results from plant operations and the level of any deferred tax balances prior to the closing of the sale.

55 Modeling framework EWC operational earnings 54 Line Item 19E 20E 21E 22E Planned plant closures Pilgrim (5/31) IP2 (4/30) IP3 (4/30) Palisades (by 5/31) Nuclear net revenue Price See EWC Nuclear Capacity and Generation Table Non-RFO capacity factor (3Q18 webcast) 96% (expected to be slightly lower as plant approaches final shutdown) Scheduled RFOs IP3 (spring) Palisades (summer) Nuclear fuel expense ($/MWh) ~2 ~2 ~3 ~5 Avg. operational nuclear non-fuel O&M, including RFO ($/MWh) ~23 ~23 ~27 ~22 Decommissioning expense 1 ~8% 9.5% accretion of the decommissioning liability Depreciation expense See EWC Capital Plan (slide 51) NDT investment earnings 2 Assuming 5.5% 6.5% blended return 3 (equity investments marked to market) Other interest income, net of Minimal (~$5 $10M/year) expense Effective tax rate ~20% 1 Decommissioning liability balances increase through accretion and decrease when liabilities are satisfied / work is completed; decommissioning expense can also be affected by adjustments as decommissioning work is performed 2 Decommissioning trust balances increase with interest earned and decrease as funds are spent on decommissioning work 3 Pre-tax return; return would be reduced by ~20% for trust taxes

56 Regulation G reconciliations 55 Table 1: UP&O adjusted EPS Reconciliation of GAAP to Non-GAAP measures 2017, 2016, 2015 and 2014 ($ in millions) Utility earnings (a) , , Parent & Other earnings (loss) (b) (175.5) (222.5) (205.6) (180.8) UP&O earnings (loss) (c) = (a)+(b) Less: Special items (d) (128.5) - - (7.6) Estimated weather (e) (127.8) Tax effect of estimated weather 1 (f) 49.2 (7.0) Estimated weather (after-tax) (g) = (e)-(f) (78.6) Customer sharing (h) - (16.1) (107.0) - Tax effect of customer sharing (i) Other income tax items (j) (31.0) Tax items, net of customer sharing (k) = (h)+(i)+(j) (31.0) UP&O adjusted earnings (l) = (c)-(d)-(g)-(k) (After-tax, per share in $) 2 Utility earnings (m) Parent & Other earnings (loss) (n) (0.97) (1.24) (1.15) (1.00) UP&O earnings (loss) (o) = (m)+(n) Less: Special items (p) (0.71) - - (0.04) Estimated weather (q) (0.44) Other income tax items, net of customer sharing (r) (0.17) UP&O adjusted earnings (s) = (o)-(p)-(q)-(r) Calculations may differ due to rounding 1 Income tax effect is calculated by multiplying the pre-tax amount by the estimated income tax rates that are expected to apply to those adjustments 2 Per share amounts are calculated by dividing the corresponding line item in the chart above by the diluted average number of common shares outstanding for the period

57 Regulation G reconciliations 56 Table 2: Normalized ROE Reconciliation of GAAP to Non-GAAP measures LTM ending September 30, 2018 ($ in millions) E-AR E-LA E-MS E-NO E-TX Utility 1 As-reported earnings available to common stock (a) ,048.0 Add back: Preferred dividend requirement (b) Income taxes (c) (184.4) (107.2) As-reported income before income taxes (d) = (a)+(b)+(c) ,069.0 Less certain items (pre-tax): Weather (e) Special item (f) Unprotected excess ADIT (g) (260.4) (86.3) (159.3) (9.1) - (561.2) Normalized income taxes before taxes (h) = (d)-(e)-(f)-(g) ,499.6 Affiliated preferred (i) Normalized income before income taxes, adjusted (j) = (h)-(i) for affiliate preferred ,372.0 State-specific standard income tax rate 2 (k) 25.82% 28.47% 27.36% 27.34% 22.14% 27.25% Income tax at state-specific standard rate (l) = (j)*(k) Normalized earnings (m) = (h)-(l)-(b) ,114.2 Average common equity (n) 2,686 5,578 1, ,257 11,660 As-reported ROE (a)/(n) 9.0% 7.6% 10.5% 11.5% 9.4% 9.0% Normalized ROE 3 (m)/(n) 8.6% 9.3% 10.4% 10.7% 8.8% 9.6% Calculations may differ due to rounding 1 Utility does not equal the sum of the operating companies due primarily to SERI (as-reported income ~$87M, normalized income ~$91M and average common equity ~$714M) and preferred dividend requirements of Entergy Utility Holding Co. 2 Represents a weighted average rate over last twelve months 3 Excludes special items and normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments

58 Regulation G reconciliations 57 Table 3: Parent debt to total debt, excluding securitization debt Reconciliation of GAAP to Non-GAAP measures 3Q18 ($ in millions) Entergy Corporation notes: 3Q18 Due September Due July Due September Total parent long-term debt 1,850 Revolver draw 630 Commercial paper 1,947 Unamortized debt issuance costs / (discounts) (10) Total parent debt (a) 4,417 Total debt 18,485 Less securitization debt 463 Total debt, excluding securitization debt (b) 18,022 Parent debt to total debt, excluding securitization debt (a)/(b) 24.5% Calculations may differ due to rounding

59 Regulation G reconciliations 58 Table 4: Operational FFO to debt, excluding securitization debt Reconciliation of GAAP to Non-GAAP measures 3Q18 ($ in millions) 3Q18 OCF (LTM) 2,770 AFUDC-borrowed funds (LTM) (57) Less working capital in OCF (LTM): Receivables (53) Fuel inventory 26 Accounts payable 258 Taxes accrued 10 Interest accrued (3) Other working capital accounts (9) Securitization regulatory charges 125 Total 354 FFO (LTM) 2,359 Add back FFO specials (LTM): Items associated with decisions to close or sell EWC nuclear plants (pre-tax) - Operational FFO (LTM) (a) 2,359 Total debt 18,485 Less securitization debt 463 Total debt, excluding securitization debt (b) 18,022 Operational FFO to debt, excluding securitization debt (a)/(b) 13.1% Estimated return of unprotected excess ADIT (rolling 12-months pre-tax) (c) 342 Operational FFO to debt ratio, excluding securitization debt and the return of ((a)+(c))/(b) unprotected excess ADIT 15.0% Calculations may differ due to rounding

60 Abbreviations and acronyms 59 Abbreviations and acronyms ADIT Accumulated deferred income taxes AFUDCborrowed Allowance for borrowed funds used funds during construction AMI Advanced metering infrastructure ANO Units 1 and 2 of Arkansas Nuclear One owned by E-AR (nuclear) APSC Arkansas Public Service Commission ARO Asset retirement obligation bps Basis points CCGT Combined cycle gas turbine CAGR Compound annual growth rate CCNO Council of the City of New Orleans, Louisiana COD Commercial operation date CWIP Construction work in progress CT Simple cycle combustion turbine DCRF Distribution cost recovery factor E-AR Entergy Arkansas, Inc. E-LA Entergy Louisiana, LLC E-MS Entergy Mississippi, Inc. E-NO Entergy New Orleans, LLC E-TX Entergy Texas, Inc. EBITDA Earnings before interest, income taxes, depreciation and amortization Abbreviations and acronyms ENVY Entergy Nuclear Vermont Yankee, LLC ESI Entergy Services, Inc. ETR Entergy Corporation EWC Entergy Wholesale Commodities FERC Federal Energy Regulatory Commission FFO Funds from operations FitzPatrick James A. FitzPatrick Nuclear Power Plant (nuclear, sold March 31, 2017) FRP Formula rate plan GAAP U.S. generally accepted accounting principles Grand Gulf or GGNS Unit 1 of Grand Gulf Nuclear Station (nuclear), 90% owned or leased by SERI Indian Point 1 Unit 1 of Indian Point Energy Center (shut down in 1974) Indian Point 2 or IP2 Unit 2 of Indian Point Energy Center (nuclear) Indian Point 3 or IP3 Unit 3 of Indian Point Energy Center (nuclear) IPEC / Indian Point Energy Center (nuclear) Indian Point ISES 2 Unit 2 of Independence Steam Electric Station (coal) LPSC Louisiana Public Service Commission LTM Last twelve months

61 Abbreviations and acronyms (continued) 60 Abbreviations and acronyms MISO Midcontinent Independent System Operator, Inc. Moody s Moody s Investors Service MPSC Mississippi Public Service Commission MTEP MISO Transmission Expansion Planning NDT Nuclear decommissioning trust Nelson 6 Unit 6 of Roy S. Nelson plant (coal) NEPOOL New England Power Pool Ninemile 6 Ninemile Point Unit 6 (CCGT) NOPS New Orleans Power Station (reciprocating internal combustion engine/natural gas) NorthStar NorthStar Decommissioning Holdings, LLC NRC Nuclear Regulatory Commission NYISO New York Independent System Operator, Inc. O&M Operation and maintenance expense OCF Net cash flow provided by operating activities OpCo Utility operating company Palisades Palisades Power Plant (nuclear) Pilgrim Pilgrim Nuclear Power Station (nuclear) PUCT Public Utility Commission of Texas Abbreviations and acronyms RICE ROE River Bend RS Cogen RSP S&P SERI TCRF Union UPSA VPUC VY / Vermont Yankee Waterford WACC Reciprocating internal combustion engine Return on equity River Bend Station (nuclear) RS Cogen facility (CCGT cogeneration) Rate stabilization plan S&P Global Ratings System Energy Resources, Inc. Transmission cost recovery factor Union Power Station (CCGT) Unit power sales agreement Vermont Public Utility Commission Vermont Yankee Nuclear Power Station (nuclear) Waterford Steam Electric Station, Unit No. 3 (nuclear) Weighted-average cost of capital