THIRD ANNUAL INVESTOR DINNER. December 3, 2013

Transcription

1 THIRD ANNUAL INVESTOR DINNER December 3, 2013

2 Forward Looking Statements Certain information provided in this presentation constitutes forward looking statements. The words anticipate, expect, or project, and similar expressions are intended to identify such forward looking statements. Although Emera believes such statements are based on reasonable assumptions, such statements are subject to certain risks, uncertainties and assumptions pertaining to operating performance, regulatory parameters, weather, economic conditions, etc. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary significantly from those expected. 2

3 Chris Huskilson, President & CEO, Emera Inc. Opening Remarks

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5 Emera Strategy The Strategic Objective : Grow EPS and dividends by an annualized average of 4 6% ; within risk profile The Strategic Elements: Reduce carbon intensity of our portfolio wind, biomass, hydro Invest in transmission connect new renewables to the grid Invest in gas generation and transportation important back up for intermittent renewables Invest in Utilities only where we see strategic value 5

6 Emera Strategic Actions 6

7 Nancy Tower CEO, Emera Newfoundland & Labrador Lower Churchill Project Update

8 What the CEO is Thinking About Our positive regulatory decision Finalizing construction cost estimates Finalizing several large contracts 8

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10 10 Churchill Falls, Labrador

11 11 Churchill Falls, Labrador

12 12 Overview of Churchill Infrastructure

13 13 Generating Station Intake

14 14 Transmission Lines to Quebec

15 15 Churchill River

16 16 Aerial Shots Muskrat Falls Video

17 17 Muskrat Falls 2017

18 Maritime Link Update

19 19 Animated Vide0 Maritime Link

20 20 Subsea Cable

21 21 Horizontal Directional Drilling

22 Regulatory Approval Achieved On November 29 th, the Nova Scotia UARB gave final approval to the Maritime Link Project. The Board s consultant found Emera s Energy Access Agreement to be both instructive and compelling, stating that it will provide NSPI with real and tangible advantages when it participates in the energy market. We will provide a routine update to the NS UARB on the project by December 15 th,

23 What s Next? Maritime Link Key Milestones Financial close within 90 days after Nalcor s financial close Finalize construction cost estimates and achieve financial close Q Construction start Q In Service Date Late

24 Bob Hanf, CEO, Nova Scotia Power Nova Scotia Power Update

25 What the CEO is Thinking About Stakeholder relationships Government, Regulator, Customer Value for Money Productivity and Cost Reduction Initiatives Continued progress on renewable energy Growth 25

26 Stakeholder Relationships: Government Nova Scotia elected a Liberal majority government in 2013 We have met with the new Minister of Energy and his department, and the meetings have been constructive Proposed legislation on Renewables to Retail strategy tabled November 29,

27 Stakeholder Relationships: Regulator Regulated by NS UARB FAM Implemented in 2009 All Capital Approved Before We Begin Open and transparent 27

28 Stakeholder Relationships: Regulatory Deferrals 28

29 Stakeholder Relationships: Customers Electricity Pricing 29

30 Stakeholder Relationships: Customers Reliability 30

31 31 Productivity & Cost Reduction Initiatives

32 Continued Progress Renewable Energy RES Requirement NS Renewable Energy Standards (RES 40% NS Power Renewable Generation Today 15% 17% 20% 20% 25%

33 Progress on Renewable Energy: The Transition from Coal 2007 Actuals 8% 4% 1% 7% 1% 3% 75% Coal 8% 12% 1% 2013 Actuals 9% 2% 5% 63% Coal Coal Oil and Diesel Natural Gas Hydro and Tidal Wind Biomass Imports/Exports 33

34 Growth Capital Investment Plan $600 $500 (In Millions of $CAD) $544 $400 $300 $200 $100 $117 $123 $112 $99 $102 $117 $101 $109 $126 $147 $280 $315 $285 $246 $228 $

35 Judy Steele, President and COO, Emera Energy Emera Energy Update

36 What the President & COO Is Thinking About Continuing to capitalize on dynamics of the New England natural gas market Integrating and optimizing our three new natural gas generating facilities Maximizing the value of the portfolio of assets 36

37 Emera Energy at a Glance An extensive presence in Northeast North America Physically based natural gas and electricity trading and marketing and asset optimization Providing full service solutions 24/7/365 to 150 counterparties Active on fifteen pipelines, moving gas across the northeast, and from Marcellus, the Gulf Coast and Alberta An electricity market participant in New England, New York, Ontario, New Brunswick, Quebec, and PJM Building a portfolio of generating assets 37

38 Capitalizing On A Dynamic Gas Market EE s Market Strategy Managed growth Physical Focus EE now moving half a billion cubic feet per day Strong Risk Management Pipeline Expertise New England market volatility reflects transport constraints and shifts in supply Marcellus Superior Client Service Broad and deep knowledge and experience of pipeline network VOLATILITY + EXPERTISE + AVAILABILITY = OPPORTUNITY 38

39 Significant Gas Marketing Footprint ~100,000 mmbtu per day from West to East ~50,000 mmbtu per day from Marcellus to Canada Between 200, ,000 mmbtu per day in NE 39

40 The The full consolidated consolidated picture picture Rumford Tiverton Bridgeport 394

41 Recent Vintage High Efficiency Plants Facility Bridgeport Tiverton Rumford Nominal Capacity (MW) Location Connecticut Rhode Island Maine COD Turbines Siemens GE 7FA GE 7FA Heat Rate (Btu/Kwh) 7,100 7,100 7,100 Capacity Factor 75% 70% 15% Gas Interconnection Iroquois Algonquin Portland Something Special Superior spark spread Growing load pocket Strong spark spread Bayside like upgrade opportunity Expansion opportunity Yes Yes No Gas by wire to Maritimes Support to Maine renewables 41

42 Where We See Strategic Opportunity De risk Merchant Exposure Provide local wind balancing resource Emera s Strategic Options Redirect energy from NE to Maritimes Expand site in premium load pockets Reconfigure plants for better success 42

43 Scott Balfour, EVP & CFO, Emera Inc. Financial Update

44 What the CFO is Thinking About Financial close for Maritime Link Executing and financing the capital plan Protecting the balance sheet Supporting and driving growth in: Earnings Dividends Cash flows 44

45 45 Adjusted Earnings per Share* Growth

46 46 Dividend Growth

47 Strong Operating Cash Flows (in millions of $CAD) * * 2012 operating cash flows reflect a $90 million voluntary contribution to Nova Scotia Power s pension plan. 47

48 Capital Plan $5.7B (in millions of $CAD) $1,225 $670 $880 $160 $1,395 $185 $595 $1,140 $35 $670 $630 OTHER ENL BASE UTILITIES $305 $175 $380 $415 $615 $435 $50 $210 $405 $50 $370 $

49 Timing of Equity Investments Maritime Link and Labrador Island Link Timing of Equity Investments (in millions of $CAD) $150 $150 $100 $70 $80 $110 $60 $5 $30 $ Maritime Link Labrador Island Link NOTE: Timing of equity investments are estimates and subject to change. 49

50 Financing Emera s Capital Plan Capital Structure Q % 7% 55% Targeted Capital Structure ** 10% 35% 55% Debt Equity Pref Financing Plan Considerations Focus on driving cash flow &cash from internal sources Eye on rating agency metrics (FFO/Debt, Debt/EBITDA, % Preferred Shares, Unconsolidated Leverage) ML accounting and gas plant financing impacts Achieving / supporting EPS growth targets Responsible capital market strategy 50

51 Maritime Link Project Financing FLG Terms Provide For: GOC guarantee of up to $1.3b debt, and 70% of project cost Flexibility for financing by way of a single bond issuance, or series of bond issuances, as well bank loans, and CP Repayment/maturity must fall within an amortizing profile ending 35 years after Financial Close FLG Terms Require: Financial Close (financing documents finalized with GOC, plus a $350mm committed credit facility) within 90 days of Nalcor s Financial Close. Initial Advance (evidenced by a draw request of >/$50mm) within 90 days of ML Financial Close: Extendable by a further 90 days if certain progress milestones achieved Completion Guarantee (of ML) from Emera 51

52 Chris Huskilson, President & CEO, Emera Closing Remarks

53 Emera Strategic Actions 53