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Hello, and welcome to the Xcel Energy 2026 First Quarter Earnings Conference Call. My name is Jordan, and I'll be your coordinator for today's event. Please note this conference is being recorded. [Operator Instructions] Reporters can contact media relations with inquiries and individual investors and others can reach out to Investor Relations.

I will now turn the call over to your host today, Mr. Roopesh Aggarwal, Vice President, Investor Relations, to begin the conference. Please go ahead, sir.

Thank you, Jordan. Good morning, and welcome to Xcel Energy's 2026 First Quarter Earnings Call. Joining me today are Bob Frenzel, Chairman, President and Chief Executive Officer; and Brian Van Abel, Executive Vice President and Chief Financial Officer. In addition, we have other members of the management team in the room to answer your questions if needed.

This morning, we will review our 2026 first quarter results and highlights, provide updated 2026 assumptions and share recent business and regulatory updates. Slides that accompany today's call are available on our website.

Some comments during today's call may contain forward-looking information. Significant factors that could cause results to differ from those anticipated are described in our earnings release and SEC filings.

Today, we will discuss certain metrics that are non-GAAP measures. Information on the comparable GAAP measures and reconciliations are included in our earnings release.

In the first quarter of 2026, the ALJ for the Prairie Island outage case recommended an additional $42 -- $41 million disallowance of replacement power costs. For power procured in 2024, associated with an extended outage at the plant starting late 2023. As a result, Xcel Energy recorded a charge of $37 million or $0.04 per share in the first quarter. Additionally, in the first quarter of 2026, Xcel Energy recognized $22 million or $0.03 per share due to an increase in estimated insurance proceeds for the Marshall Wildfire litigation.

Given the nonrecurring nature of these items, they have been excluded from first quarter ongoing earnings. As a result, our GAAP earnings for the first quarter of 2026 were $0.89 per share. While our ongoing earnings, which exclude these nonrecurring charges, were $0.91 per share. All further references to earnings, drivers and variances in our discussion today will refer to ongoing earnings. For more information on this, please see the disclosures in our earnings release.

I will now turn the call over to Bob.

Thank you, Roopesh, and good morning, everybody. At Xcel Energy, our mission is to make energy work better for our customers, helping them thrive. Our past quarter showcased our commitment to this mission through focused execution and delivering on our plans to strengthen and modernize the grid, expand our energy sources and to deploy innovative technologies to ensure that the energy that we provide our customers remains reliable, affordable and safe both now and well into the future. And on these fronts, we are off to a great start this year.

In the first quarter, Xcel Energy invested over $3 billion in new infrastructure to support our customers and states growing energy needs for increased resilience, and cleaner energy, and we're on track to deliver our most extensive capital investment plan in the company's history this year. We identified additional transmission and generation needs in our states, delivering on our expectation of incremental investment above our base plan.

We announced the details of our contract with Google for a new data center in the upper Midwest that we believe is a model for large load development that benefits customers and communities. We filed that contract with the Minnesota PUC. We continue to use our scale and our balance sheet to ensure that we have the right partnerships with critical suppliers, Tier 1 EPC firms, and developers to execute on budget, on time and on scope on our growing portfolio of projects.

We delivered strong ongoing earnings of $0.91 per share, and we remain confident and our ability to deliver on our annual investment plans and our earnings guidance for the 22nd year in a row, one of the best track records in the industry.

On our fourth quarter call, we announced progress on our data center pipeline with a signed ESA for a large data center in the Upper Midwest. And during the first quarter, we provided further details about this groundbreaking agreement with Google. As demand for electricity accelerates across the country, we believe that utilities have a responsibility to lead with solutions that balance innovation, reliability, sustainability and affordability.

Xcel Energy's customers already have some of the lowest energy bills in the country. In fact, when you adjust for inflation, the typical Xcel Energy residential energy bill is almost 25% lower today than it was 10 years ago. And in nominal terms Xcel Energy residential electric bills are approximately 30% below the national average.

Under a 15-year agreement, Google will cover the entire cost of its service and infrastructure requirements to power its new data center, including 1,900 megawatts of new wind and solar generation and long-duration storage using [ Form Energy's ] innovative 100-hour [ ion air ] battery. With credit protections in place, we estimate this new data center will save customers $1 billion to $1.5 billion over the term of the ESA, helping keep customer bills low long into the future. In addition, and as part of our shared sustainability goals, water needs for the data center will be limited through Google's use of air cooled technology in lieu of water cooled.

In April, we also reached a definitive non-exclusive agreement on our previously announced MoU with NextEra Energy to co-develop generation, storage and interconnections to accelerate data center development across our operating companies. We expect this joint development agreement will balance -- will deliver a balance of company-owned resources and purchase power agreements with NextEra across all forms of generation, including wind, solar, battery, storage and natural gas. We are already underway developing solutions for 2 gigawatts of new data center capacity with plans to expand in the near future.

In April, we also filed our large load tariff in Colorado with proposed terms that are similar in scope to our Google ESA and the Minnesota large load tariff filing. Data centers will commit the long-term contracts with minimum bills, termination fees, credit requirements and incremental cost tests to ensure that our existing customers are protected from new large load customer needs. In the coming months, we plan to make similar filings in Texas, New Mexico and Wisconsin.

We believe our partnerships with hyperscalers, regulators, communities and developers set a high bar for responsible large load development. We're partnering to ensure large load growth strengthens our overall system, benefits our local communities and maintains our state's clean energy goals and doesn't increase cost for our existing customers. These collective actions give us confidence in our ability to deliver on our forecast to secure 6 gigawatts of data center load by year-end 2027 with in-service dates into the early 2030s.

In October of last year, we outlined our plan to meet the growing infrastructure needs of our customers. We've detailed a $60 billion base investment plan to continue our energy transition and to make needed investments to strengthen our transmission and distribution systems. At that time, we also expected that our base plan would likely need to be augmented based on anticipated but unapproved transmission and generation needs.

Through the first quarter, we now believe we have line of sight to at least $7-plus billion of the $10-plus billion opportunity that we highlighted last year. This incremental investment includes the 765 kV process draw to Fantom transmission line in our SPS company that was allocated by SPP in February. 2/3 or over 1,200 megawatts of the generation of storage needed for the Google data center project, and 800 megawatts of generation approved by the Colorado Commission in February and April as part of the near-term procurement portfolio.

From here, we continue to see additional infrastructure investment needed to serve our growing customer needs, including active generation RFPs in PSCo, NSP and SPS, additional regional transmission investments in SPP and MISO and the generation to support the 3 gigawatts of data center demand that we added to our target plan on the Q4 earnings call.

As these opportunities materialize, they will drive additional growth in investment, both within and beyond our 5-year capital plan. As we continue to add to capital backlog, it's also important to execute on the projects that are in the queue. And in the first quarter, Xcel Energy invested over $3 billion in new infrastructure for our customers. We brought online nearly 500 megawatts of new solar generation and utility scale battery storage in SPS and in Colorado.

In total, these projects will deliver system resiliency and reliability as well as over $425 million of tax credit benefits to our customers over the life of the projects. And across our entire portfolio of projects from 2026 to 2030, we expect customers will see more than $7 billion in aggregate benefits from PTCs and ITCs associated with various generation and storage projects, helping keep our customer bills amongst the lowest in the country.

And with continued growth across our industry, we also recognize that supply chains and qualified labor for generation, transmission and distribution projects will become more constrained. That's why I recently announced alliances with GE Vernova and NextEra and strategic agreements with Tier 1 EPC firms across our portfolio of renewable and gas generation, transmission and distribution projects are critical to delivering on our growing investment pipeline well into the 2030s.

Finally, our field teams continue to operate at the highest levels and were recently recognized by EEI with an Emergency Recovery Award for outstanding efforts to restore service quickly and safely following severe thunder storms that came through our Upper Midwest service territory in 2025. And for the seventh year in a row, Xcel Energy was named the World's Most Ethical Company [ Honore ] by Ethisphere, which measures the company's corporate governance, culture of ethics and environmental and societal impact.

As we look forward to the rest of 2026, Xcel Energy will continue our focus to deliver customers safe, clean, reliable and affordable energy, execute with excellence on our 2026 $14 billion capital investment plan are most extensive in the company's history, to realize the unprecedented opportunities for growth that we laid out in our base and incremental investment plans, to secure incremental large customer loads that can benefit all customers and meet this moment in our country's growing demand for energy, to reach constructive outcomes on multiple rate cases and resource solicitations, make operational and system hardening investments to protect our communities from the risks of extreme weather and to deliver on our earnings guidance for the 22nd year in a row.

With that, I'll turn it over to Brian.

Thanks, Bob. Good morning, everyone. Starting with our financial results. Xcel Energy had ongoing earnings of $0.91 per share for the first quarter of 2026 compared to earnings of $0.84 per share in 2025. The most significant earnings drivers for the quarter include the following: higher electric revenues due to rate case outcomes, nonfuel riders and sales growth, partially offset by weather increased earnings by $0.23 per share and higher AFUDC increased earnings by $0.10 per share. Offsetting these positive drivers, higher interest charges and common equity financing decreased earnings by $0.18 per share, reflecting funding of our infrastructure investments and discipline to maintain a strong balance sheet. Higher depreciation and amortization decreased earnings by $0.05 per share, reflecting our capital investment programs and lower natural gas revenues due to weather partially offset by rate case outcomes decreased earnings by $0.03 per share.

Turning to weather and sales. Colorado overall experienced its warmest winter on record during the first quarter. As a result, impacts from weather to electric and natural gas sales reduced earnings by $0.09 per share. On a weather-adjusted basis, first quarter electric sales increased by 2.8% driven by continued oil and gas growth in SPS and broader C&I growth across jurisdictions. For 2026, we continue to expect full year weather-adjusted electric sales to increase 3%.

Moving to recent regulatory activity. In our North Dakota electric rate case, the commission approved our previously announced settlement authorizing a $27 million revenue increase. And in our South Dakota electric rate case, we reached a constructive black box settlement with staff for a net revenue increase of $26 million. A commission decision is expected in the second quarter.

This Tuesday, we received intervenor testimony in our Colorado electric rate case, which we believe provides a starting point for ongoing settlement discussions over the next month. Late yesterday, we received the ALJ report on our Minnesota electric rate case, recommending a 9.8% ROE and a 52.5% equity ratio, with a final commission decision early in the third quarter. And in New Mexico electric rate case, intervener testimony is due on May 1, and we expect the commission decision in the fourth quarter.

As we look to our financing plan, Xcel Energy continues our commitment to maintain a strong balance sheet to fund accretive growth with the balance of equity and debt. In the first quarter, we issued forward contracts for over $1 billion of equity from our ATM program. Additionally, we issued an $800 million junior subordinated note at the holding company, which received 50% equity credit with the rating agencies. This, combined with our unsettled forwards and [ collar ] forward contracts from 2025 addresses over half of our $7 billion of equity need in our 5-year base plan.

We also continue to make strong progress on the Smokehouse Creek wildfire claims process. We've resolved 231 of the 300 submitted claims. We've reached settlements with 79 of 107 potential claims presented for mediation by parties represented by attorneys. And finally, 26 of 73 complaints have been settled or dismissed and have reached a statute of limitations for property loss claims. We've updated the low end of our estimated liability to $460 million. We have committed $397 million in settlement agreements, including agreements with the subrogated insurance plaintiffs in the 3 largest claims by acreage. In total, we have $525 million of insurance coverage.

Moving to guidance. We are reaffirming our 2026 ongoing EPS guidance range of $4.04 to $4.16 per share. We remain confident in our ability to deliver 6% to 8-plus percent long-term earnings growth and expect to deliver 9% EPS growth on average through 2030. Updates to key assumptions are included in our slides and earnings release.

With that, I'll wrap up with a quick summary. Xcel Energy posted strong ongoing first quarter 2026 earnings of $0.91 per share. We continue to lead a clean energy transition while ensuring safe, clean and reliable service and keeping customer bills as low as possible. We have line of sight to $7-plus billion of opportunities in our incremental $10-plus billion investment plan. We've announced details of our data center agreement with Google, which we believe is a model for driving large load growth while protecting and [ driving ] benefits to our other customers and communities.

We partnered with multiple Tier 1 EPC firms, critical suppliers and developers to ensure we have the resources needed to execute on a growing portfolio of investment opportunities on budget, on time and on scope. We continue to work to reach constructive outcomes, including settlements in our active rate cases. We maintained a strong balance sheet and credit metrics and have addressed over half of our $7 billion 5-year base equity needs. We are reaffirming our 2026 ongoing EPS guidance of $4.04 to $4.16 per share. And finally, we remain confident in our ability to deliver 6% to 8-plus percent long-term earnings growth and expect to deliver 9% EPS growth on average through 2030.

This concludes our prepared remarks. Operator, we will now take questions.

[Operator Instructions] The first question comes from the line of Richard Sunderland from Truist Securities.

Starting with some of the -- starting with some of the regulatory progress this week. I guess Colorado with the intervenor testimony, could you expand a little bit more on the sort of settlement potential over the next month that you referenced in the script? And I guess just curious about any other takeaways you'd highlight there? And then similarly on Minnesota with the ALJ rec. Just any other thoughts you could offer would be helpful.

Yes. Yes, absolutely. I think I'll start with Colorado Electric. I think maybe we'd take a step back a little bit from a macro view. We have the lowest bills in the country. In Colorado, a 1% share of wallet. We have one of the fastest transitioning clean energy systems, generation fleets in the country. And so we're achieving state policy. And hopefully, that is recognized by our policymakers in the state.

Now specifically about the rate case, the -- we look at the intervenor direct testimony and it's relatively consistent with what we saw in the last case. And if you look at our last case in Colorado, we had near unanimous settlement and we've settled 3 of the path for our electric cases. So we think we have a decent starting point. If you look at the procedural schedule, the settlement deadline is on May 28. So we'll start settlement discussions, look forward to working with the parties early in May. And hopefully, we can reach a constructive settlement like we have in the last few rate cases. So that's kind of on the Colorado side.

On the Minnesota side, for those of you who didn't catch it, we have the Minnesota ALJ report late yesterday. It was after we had already shipped off or ER, so it's not referenced in our earnings release. You will see details in it -- in our 10-Q that we file later today. So look for a full disclosure in our 10-Q as we work through it.

No, we think it's generally a balanced overall recommendation. It's constructive to see a 9.8% ROE, a 52.5% equity ratio. We're digesting a few of the other kind of trackers and other pieces in it. But overall, we think it's a constructive recommendation. And procedurally, we'll see MPUC deliberations in June and then an MPC order in July. So as we talked about, we're working through a lot of rate cases and looking to reach some constructive outcomes this year and deliver for both our customers and our shareholders.

Great. Thanks for running through all of that. And then turning to some of the data center activity. Obviously, you had a lot of commentary around the Google agreement and the landmark effort there. But I'm curious, I guess, in Slide 14, I think the 4 gigawatts contracted by year-end '27, just any thoughts on sort of the gating factors to signing the $6 billion to $8 billion incremental CapEx framework you called out elsewhere in the deck, is that applicable there? And I guess just anything you can highlight on the financing side of those advance as well. Any unique ways to finance that?

It's Bob. Let me kick it off, and then I'll ask Brian to weigh in with anything extra. Not surprisingly, yesterday's hyperscaler announcements continue to show high interest in data center development, and we're seeing a lot of interest across all 8 of our states in terms of activity and backlog. So at the top of the slide you mentioned, Richard, is a 20 gigawatt backlog, and that continues to -- a greater than 20 gigawatt backlog, and that just continues -- the interest level continues to grow in our service territories.

We've got a gig under -- either built or under construction, another one that we're in front of the commissions with approvals on, particularly this Google transaction and expect, as we said in our fourth quarter call, to execute on enough ESAs this year that we get to a 3 gig target, another 3 gig next year. So we're actively engaged with our customers. These are long and deliberate discussions to make sure that we can reach innovative and constructive outcomes like we did with the Google.

I think we've proven that we can do competitive, highly renewable, low-carbon data center development in our regions. I'd say we have the most length in our company in the Upper Midwest, and that's been a focus area for us and a focus area with our JDA with NextEra. But as we think about the large load tariff filing in Colorado and the abilities that it allows us to bring the generation of the transmission and the load all together in a package to the Colorado Commission. And then we have those capabilities as well through both SPP and SPS processes in Texas and New Mexico.

And we do expect to file a large load tariff in Texas as well this year to help expedite that, but it doesn't preclude us from coming forward with contracts in the near term. So we're active on the engagement front with all the hyperscalers and all of the large data center developers and just a lot of interest in the footprint that our company provides in terms of high penetrations of low-cost renewables that our existing customers have benefited from, and we think these large load customers can benefit from as well.

Yes. Just a couple of things to make sure we get all parts of your question there. As we think about -- you referenced a $68 billion number, that's something we've had in our slides before in terms of -- that's what we view the incremental investment opportunity to sort of every gigawatt of data center. If you look at Google being a model that's served with a lot of renewables, long-duration storage, very different than if you're serving it with just the CCGT. So when we think about moving forward, our clean energy policies and priorities and meeting our state objectives that gives us a really good investment opportunity when we think about how we're going to serve these.

And you think about -- if you look at the slide, when we talk about our $10-plus billion investment pipeline, that slide, we talked about the RFPs 10 to 12 gigawatts of RFPs in flight. And then it's the 3 additional gigawatts of data centers that we expect to contract. Those 3 gigawatts of data centers are going to be another 6, 9,10 gigawatts of generation that we need. So a huge long-term opportunity to kind of fill in the back end of this 5 year, but also just deliver transparency and growth visibility into the early 2030s. So not only about filling in our investment pipeline here in the back half of this decade but really driving investment driving the investment pipeline in the early 2030s.

And that is have to mention just the customer affordability opportunity that this drives and we think about -- we bring forward the clean energy opportunity with the resources and the resources advantage we have in the middle of the country, paired with the affordability benefits for our current customers. So we're super excited about this opportunity.

You asked about a kind of alternative financing, but we're certainly looking at all of those alternative financing, just like we know what our peers are. Right now, our base plan to beat is how we've talked about it, funding incremental CapEx with incremental equity of roughly 40%. And we're already ahead of our -- we're one quarter into our 5-year plan, and we have 50% of our equity taken down for a base 5-year plan. So I think we're really staying ahead of it, and we'll continue to deliver growth and happy to fund accretive growth with equity and maintain that strong balance sheet because we think it's really important as you go through this cycle of long-term extended growth. So sorry, long-winded answer, but yes, like 3 or 4 questions there.

We appreciate the comprehensive response.

The next question comes from the line of Nicholas Campanella from Barclays.

And appreciate all the regulatory follow-up. Maybe just on the -- you have line of sight now to the $7 billion of incremental versus, I think, $10 billion of upside. And just maybe give us some clarity on the shaping of that spend and as you roll forward the plan, I believe, to 2031, just how much of that is going to get encapsulated?

Yes. Nick, I can take that one. We kind of -- in that Slide 8 in our earnings deck, we kind of highlighted the different pieces of that $7-plus billion. Think of all that -- that trend that 765 transmission line in SPS that should be in service by the goals by 2031. So a lot of that will be captured in our current 5-year plan is in kind of the back part of that 5-year plan. The Colorado generation 800 megawatts some gas and 600 megawatts of wind. Again, that should be in service by around 2030, particularly the wind when your goal is to capture the production tax credits.

And then we haven't specified the in-service dates on the assets to serve Google that's still not public. But if you think about it, if it's wind and solar, the goal is to get those into capture the tax credits to ensure that you have low-cost renewables. And so -- and then the long duration storage has a longer potential runway in terms of tax credits. So that's the best way to think about it. As we roll forward, we always provide our comprehensive update in Q3, but that's a good way to think about kind of how this stuff rolls into this front [indiscernible] with a little bit flowing into kind of early 2030s.

Okay. That's great. I really appreciate that. And then maybe just a follow-up is, as you get to the back end of that plan, the large loads are going to be ramping hopefully and at what point would you kind of revisit the 40% equity financing assumption? And then secondly, just any thoughts on defending the Baa1 outlook here with Moody's?

We think about it longer term, it's important to maintain a strong balance sheet, good credit metrics. Now we certainly understand where we are with Moody's. And we think about it over the long term, is that 17% [ CFO to debt ] type of metric. Obviously, in a large build cycle, it gets pressured a little bit, but we do believe and I've always said it, anyone who's listened to me for the past 6 years as CFO, is that it's important to maintain a strong balance sheet over the long term.

In terms of that equity financing, that's generally been our rule of thumb. But every time we roll forward a new 5-year plan depending on the cash generation, cash profile, timing of projects in service, tax benefits, we incorporate all that. So 40% is a rule of thumb, but we'll continue to be consistent with what really maintains our metrics. But like I said, we think in this type of build cycle, this type of capital investments, a volatility in the market, it's important to have a good balance sheet to weather through things.

Great. And then just one more that I had that we were curious on is just the MISO capacity print. I mean, I know it came down a little bit earlier this past week. And do you see that as a tailwind at all to the territories that you're operating in? And then as you kind of think about capacity planning, where you're doing data center development, how is that maybe changing thoughts there?

Yes. Nick, it's Bob. Thanks for the question. One of the interesting things about the MISO market and the capacity auction itself, it's been much more volatile and less predictable than maybe some of the other regions, given the large bilateral nature of the MISO market. The print itself isn't something we look at in the near term because we have a bit of length here in the upper Midwest, and we've been able to sell into that market. But over time, it's not the signal that we use to drive new capacity additions and new load forecasting. So relatively uninteresting in the short term for the capacity auction in MISO and we'll keep an eye on it. But our long-term forecast is in partnership with MISO, where we see asset additions, asset reductions and load growth still leads to a really exciting region in an area that data centers definitely want to show up and be energized by. So not much to the auction itself.

Our next question comes from the line of Julien Dumoulin-Smith from Jefferies.

Let me nit pick on a few things you guys have already said here. So just taking it from the top, on Colorado intervenor testimony, obviously, hearing some decent confidence on settlement. Again, I never say it's never done until it's done. But how do you think about the prior guidance of this 50 to 60 basis points of lag here? How do you think about that being attainable? What are the permutations? And then also given in parallel here, the comprehensive capital riders here now available, how do you think about the future cadence of cases? How you might come together around any settlement and trying to establish a longer duration here?

Julien, I can take that one. I think really, certainly, if we can reach a constructive settlement that prior guidance remains intact. I think when you look at kind of where staff and UCA are at a 9.0 kind of midpoint for staff and 9.2 ROE for UCA. It's like I said, it's a decent starting point for settlement negotiations. And certainly, our equity ratios in Portland, Colorado, like I was talking about, overall, it's really important to maintain credit quality in Colorado, too. So the equity ratio is a significant point of that.

But like I said, we've had a good history, a good track record of settling on the electric side. So you think about the riders and the opportunity. I think there is an opportunity to have a longer-term path to not filing rate cases maybe every year that we have been. But certainly, it does depend on the constructive settlement here on the electric in the electric case to kind of set that base framework. So it's absolutely something we're thinking about and look forward to engaging the parties here over the next months is if we can read something constructive.

Awesome. Excellent. And then to go back and take a little bit on Nick's question around the data center large loads. A couple of pieces here. Just what's the geographic footprint that you're contemplating here in incremental announcements? I mean, obviously, the different states have different tax regimes. You alluded here to Texas filing something here. How disproportionate might that geography be relative to your others here? How might that impact, again, the comments that you just made about Colorado? And then to nitpick further, this NextEra partnership, you throw 2 gigawatts out in that pipeline, is that separate and distinct from what you're talking about in this 3 gigawatts by '27? Sorry, I know you've thrown a few different numbers, but I want to try to tie them out here.

Julien, it's Bob. Thanks for the question. And let me see if I can clarify a little bit. First of all, like I said, we started with generation length and transmission capabilities, and that's led people to be most interested in the upper Midwest, the Minnesota, the Wisconsin and the Dakotas are really interesting to our data center developers in the near term where we have more length. In the longer term, working on a large load tariff in Colorado, there's active legislation in Colorado around trying to work on making Colorado a place where we can have a framework -- legislative framework to bring data centers there and attract them.

And then in the South West, a hugely popular region given the price of electricity down there and the attractiveness down there. So I think when we talk to developers, they -- first of all, I think when you're talking to the large hyperscalers and the developers, they like working with us because we have multiple regions of the country, and we can deliver solutions in different parts of the country that help them meet their portfolio of needs across a large swath of the United States.

When we talk about the high probability pipeline or the high probability projects, we expect 4 more gigawatts to be contracted by the end of 2027, that's inclusive of the 2 we threw out there with NextEra and the NextEra partnership could be larger than that. I was just commenting on the fact that we're actively engaged in 2, it could be bigger to serve all 4, but we're working on that. That's helpful.

Awesome. All right. Excellent. And then just in as much as just nitpicking on cost, obviously starting the year out well, any updates on Sherco here and timeline there?

Julien, do you mean comanche?

So -- well, I was thinking Sherco is going as much as -- I think it's still planned retirement in '26, right?

Yes. Our plans are to continue to retire Sherco at the end of this year, and we have both the transmission and generation needed to serve that interconnection on a go-forward basis in the Upper Midwest and it's part of our long-term resource plans in the Upper Midwest. Those plans are still intact. We've not heard anything that would lead us to do anything differently at this point.

Awesome. Sorry, I know lots of things going on. Best of luck. You guys got a lot cooking.

Your next question comes from the line of Carly Davenport from Goldman Sachs.

Maybe just a couple of quick ones on Colorado. First, I think the PUC Sunset Bill came out of committee last week. Just maybe your latest views there on some of the provisions around securitization and maybe views on potential for changes like expanding the size of the PUC and just kind of your thoughts around that?

Sure. Happy to comment. You're accurate. Each of the agencies in the state undergo sunset review, the PUC was up this year. It's usually somewhere in a 7- to 10-year cycle. And the goal is to look at the effectiveness and the efficiency of the agency and the necessity of the functions for the futures of the state. So one of the provisions in the legislation itself was the expansion of the use of of securitization as a tool. We've -- I think we've been really thoughtful as a company in proposing securitization in the cases where it makes a lot of sense.

If you look back we have permission to securitize the remaining balance of Comanche 3 when that plant retires at the end of 2030. We've looked at securitization for portions of our wildfire investment in the state. We've proposed and not executed on securitization around fuel costs, particularly around winter storm Yuri. So there's sort of -- that's a good tool to have in the tool chest. I just think we want to make sure that it's used for the right things as we go forward, and we're talking about securitization.

We are very engaged in the legislation as drafted. There's a little bit of time between now and the end of session and we continue to talk with all parties about how to make sure that we can bring efficiency and effectiveness to the state, whether it's speed of filings, decision-making on resource plans, there's a lot of things that we think that in this era of energy growth that we'd like to see be able to do and to partner with the PUC as we move forward to working with all the stakeholders to do that.

Got it. That's really helpful. And then maybe just as we move more sort of into the core of wildfire season in Colorado over the next couple of months here, maybe can you just talk a little bit about sort of expectations going in based on current sort of weather forecast and the mild winter that you had in Colorado? And then just maybe touch on some of the risk reduction work that you've done in the last couple of years to get ahead of that risk?

Yes. Thank you. I appreciate you recognizing all the great work that the team has done over the last number of years. It still goes in a number of buckets. We talk about situational awareness and our ability to understand weather patterns and take action on more discretely more accurately with less customer impact has grown over the [indiscernible] than a opportunity to [indiscernible] grown and our ability to [indiscernible] make it safer [indiscernible] in the prone area is sufficient [indiscernible] new outage management systems, new customer notification systems, more engagement on the community side.

So yes, we are in a low snowpack in Colorado this year in a drier conditions. We think with all the things we've done under the operational side, the situational awareness side and the community engagement side is going to lead us to have a high safe summer in Colorado.

Your next question comes from the line of Jeremy Tonet from JPMorgan.

Just wanted to come back to the Google agreement here. I'm just wondering what you think that means more broadly if Google is willing to pay for newer technologies and such like form here. What do you see this as a trend? What do you see these trends and the other conversations at this point as far as appetite?

Yes. I think that's -- it's a great question in the sense of if we think about what our kind of our alignment with state policies and how we move this forward. I think one good example is in Colorado, in the legislative session, there's an advanced geothermal bill moving through the legislature. And that could be another place where you could see maybe a hyperscaler could help fund advanced geothermal project in Colorado, given Colorado's focused on the clean energy transition. So I think this is a really great theme as we think kind of how do we align the data center opportunity, hyperscale opportunity with our state policies objectives from a clean energy perspective, right?

New technology is generally more expensive. It takes investment to commercialize it. And so we think this is a great kind of blueprint as we think about longer-term opportunities in not only again in Minnesota but other parts of our service territory.

And I'll come back to, Jeremy, the idea that we believe that these large customers are absolutely committed to long-term sustainability of their own product. And because of that, they're highly interested in our regions of the country where I always say the wind blows and the sun shines and we can deliver both renewable energy as well as innovative technologies, and we've seen real receptivity at our commission levels to do that, particularly when it's protecting existing customers. So we're going to continue to be innovative. We're going to continue to be sustainable. And I think that we're working with the customer set that is aligned with us.

Got it. And I was just wondering maybe if we take a step back, if we just think about, I guess, your ability to win more data center load here kind of stands out maybe versus others in the industry. I'm just wondering if you could speak to what do you think is some of the key tier offerings, if it's speed to market or if it's a type of solutions or otherwise? Just wondering what you see as kind of key to the rate of wins as you guys have posted.

Yes. Great question. We think, and I've been saying this for years, that the diversity of our company, the diversity of our regions, the ability to deliver various fuel sources and types to deliver speed to power to these customers is really important. Speed is very, very important to these folks today. And as we roll through time, I'm convinced that sustainability is going to be very important to them.

Just take how we handled the water situation. Even in the land of 10,000 lakes in Minnesota, water is still a real key topic. And the ability for us to partner with a large data center owner and operator and come up with an innovative creative air cool versus water cooled solution can be a template of blueprint for development going forward. So as you can imagine, we are talking with all the hyperscaler developers -- hyperscalers as well as all the data center developers. And depending on their customer mix and their perspectives, they're going to find value across portfolio of states that we serve, and we're here to meet that moment for them.

Yes. And I would just add a little bit on the execution side. We are sitting in the middle of the country, if we're going to deliver a portfolio of clean energy resources, that takes a development team. That takes scale. If you look at just our base plan, we're developing 10 gigawatts of generation in storage, 7 gigawatts of that is renewable. So it takes a platform, and that really gets to our partnership on the EPC side, our OEM side because when you think about what's next another gigawatt this year, 3 more gigawatts next year, that takes a significant pipeline of clean energy resources for us to execute on.

So I think the hyperscaler is having the confidence in what we're doing already and having that track record of delivering these projects on the renewable side is also really important.

Got it. That's very helpful. Just a real quick last one, if I could. I recognize this is probably premature, but figure I'll try anyways. After seeing the ALJ just now, any thoughts on the prospects for settling given this very early time of review?

Just on the electric side, I think, generally, the most likely time to settle is leading into hearings. And we've had the hearings. Certainly, we'd be willing to discuss settlement, but really, the impetus is leading into hearings, which happened already. So we're looking forward to the MPUC deliberations in June and seeing the order in July.

Our next question comes from the line of Ross Fowler from Bank of America.

So just a couple of specific questions and then one general question this morning. So for the JDA with NextEra, is there -- do you see potential to expand that beyond 2 gigawatts? How are you thinking about expanding that?

Yes. Look, the JDA itself is unbounded as far as I'm concerned. We partnered with a national development platform to pair nicely with, as Brian mentioned earlier, our very strong strength in generation and transmission development itself. And so that partnership, that JDA could be -- we did this for speed to power and expand the pie and to deliver on this moment in the country's needs. So it could be the partnership that we go through all of our generation needs for large loads. It's not exclusive, though, it doesn't have to be. We still have great relationships with all the other generation developers and data center developers out there. So -- but there's no limit on it.

Okay. That's very helpful. And then -- we've touched on it, Jeremy's question touched on it a little bit. You touched on above at the beginning. One of the things that maybe the market has been thinking about because we're focused on growth, growth, growth and more growth is sort of the layer of execution risk behind that. So you have the GE Vernova strategic alliance. Just on those 5 natural gas turbines, is that just in the queue or price? So that's the specific question.

And then the general question, right? Can you point to some things because I think you guys have a different sort of execution risk profile than most?

Well, so let me start with the immediate question. We have 24 gas turbines through Siemens and General Electric that are slotted and in various stages of production and delivery over the next 5 years. So I feel very comfortable where we sit on access to gas turbines and ability to meet our base and our upside case. With respect to risk profile, I think we sit in a great spot. And I don't know if you were trying to complement us there or not, but I'm really excited about where we sit with our key vendors and suppliers, GE Vernova being just one of them, NextEra just being one of them.

But we've got negotiated and framework agreements with handfuls of both EPC vendors and equipment vendors across both our transmission, our distribution and our gas businesses. We've got wind turbines available. We've got solar. We've got breakers, high-voltage transformers. We've got a lot of equipment and access to people through our partnerships, and we feel very confident in our ability to meet our base and our upside capital plans.

Yes. And I think, Ross, that's one of the reasons why you see that slide in there about the generation -- or base generation of executing over the next 5 years, right? The EPCs or OEMs see that we have a long pipeline, and it's how -- scale matters and that's how we get these partnerships with the Tier 1s. And really, it's not just through 2030 is long-term partnerships. If you move from site to site to drive crew efficiencies, you don't have [indiscernible] costs. So there's a lot of efficiencies. We can drive scale in terms of ordering multiple gigawatts of [ Bob said CTs ] or wind turbines. So huge, huge benefits of scale here, and I think that helps derisk us from an execution perspective.

And also we think about it, it gets to how are we competitive in RFPs, how do we deliver the most competitive projects for the benefit of our customers, ultimately is what it gets down to.

Yes. No, it's definitely about to be complementary, Bob. You guys have locked a lot of this down and [ thought in a very Old Navy guy way ]. So definitely that to be complementary.

Your next question comes from the line of Steve Fleishman from Wolfe Research.

So Slide 8, just the famous Slide 8, can you spend a quick minute just on the noncheck marked items and when we'll have visibility on them? And then also just like how much of the CapEx would show up by 2030 on some of those?

Yes, Steve, happy to take that. Yes, we just start kind of the most near-term is the SPS RFP. We received the bids in January going through the evaluation. You'll see a -- we'll make a filing with the New Mexico Commission here later in Q2 and that's 1,500 to 3,000 megawatts of nameplate capacity. A lot of kind of renewables in that as part of that is to meet the New Mexico Renewable Energy Standard. So we expect renewables related to that would come in prior to the end of 2030. So the good opportunity there in terms of what filters into that back part of our 5-year plan. So that's the nearest-term catalyst.

The NSP RFP where we received -- just recently received the bids working through the evaluation process and expect a filing with the Minnesota Commission later this year. Again, that was one of those acceleration of our resource acquisition for the secure renewable resources for the benefit of our customers to make sure we capture the tax credits. So that's, again, looking 4,000-plus megawatts renewable generation storage by 2030. Obviously, that filter into our base 5-year plan. So really great opportunities on top of the $7-plus billion that we've basically given line of sight to through this first quarter.

Then the next one is Colorado. We're working through the Colorado GTS and we'll file an RFP later this year. So that is something will play out into next year. And -- if the renewable resources, the goal will to get them in by 2030, but there's likely some baseload in thermal generation coming with that. So that could slip a little bit into the 2030s on that, just depending on when we need the resources.

Then on the 765 transmission lines in SPP, that's a competitive bid that we'll bid into later this year. We likely won't get a decision on that until next year. And then on the data centers, obviously, we talked about, we're going to execute on 1 gigawatt this year, and then the 3 gigawatts really will be a significant opportunity next year and kind of depends on what those resources are. But I view that as really how do we deliver those longer-term growth visibility post 2030. I mean we have a great line of sight into 2030 -- in the early 2030s, how do we continue to extend that and give our shareholders visibility into a long term -- executing on our long-term growth objectives.

Okay. Just one quick follow-up on the NSP and SPS renewables RFPs. Just do you -- do you expect most of that to be company-owned or some -- will some of this be PPAs? Or how should we think about that?

Yes. Look, I think it's a balance. I mean we haven't disclosed any of the details and we always say publicly 50-50. We've done better in some RFPs in the last SPS we did north of 75%. Minnesota, we have some opportunities in terms of if you think about reusing transmission interconnections. So -- but I think our -- always our guide is 50-50 important that we have competitive projects as it goes to our regulated development team in terms of bringing forward competitive projects for the benefit of our customers. But we always guide 50-50 and our goal is to do better because we think we have really competitive projects.

Your next question comes from the line of Sophie Karp from KeyBanc.

Congrats on a good update here. Is there a way for you to quantify customer benefits from incremental data center load as it materializes like some of your peers are doing? I'm just kind of thinking sort of beyond potential kind of community relations issues and things like that, that arise sometimes and if that could be helpful for you to kind of show that benefit more directly? Is it possible?

Sophie, it's Bob. It's a great question. On the Google data center itself was close to 1 gigawatt led to $1 billion to $1.5 billion of customer savings, all customer savings. That translates to about 1% to 2% of residential electric customer net benefit. Probably not a bad thumb rule, but we haven't given any guidance on that. And so let us think back through, as we look at our other jurisdictions, a lot of that benefit comes from sharing the fixed costs of the grid. And so the transmission rate and the investment in transmission in any of our particular regions is a big driver of that when you add a large load to the transmission grid and the ability to share that cost more broadly amongst more megawatt hours.

In particular, on the Google side, the addition of 1,900 megawatts of wind, solar and storage is also beneficial as we think about dispatch priority in the Upper Midwest, so that's a knock-on effect. It's also beneficial for our customers. And certainly, the carbon neutrality of those assets is also beneficial. We haven't given any firm guidance, but it's probably in that ZIP code, and we can probably work on something like that for the future.

Our final question will come from the line of Anthony Crowdell, Mizuho Securities.

Hopefully, 2 quick ones. You guys are very aggressive in doing, I guess, about 50% of your equity over 5 years just in the first quarter. Any cadence on the remaining half? Are you looking to take care of it all in '26? Or any color you give on that? And I have one follow-up.

Anthony, generally, we don't give specific timing on equity issuance is all I can say is we've been very proactive. And if you look at the forward component, the ATM going to be pushed out a couple of years. So it gives you a lot of flexibility in terms of when do you issue and when you actually draw down the equity proceeds. So it can really help kind of how do we time it with the capital investment needs. So we'll continue to be proactive on this and get out ahead. We're pretty proud of having half of our equity need locked down with one quarter into a, call it, 3 months into a 60-month plan.

Great. And then just quickly, on Smokehouse Creek. You guys gave a lot of detail on the slide. I appreciate it. You're still under the insurance cap, I think, $525 million, you've been, I guess, aggressive on working through settlements. Just any color there you have on maybe resolving all of it or out of the 107 potential claims? Just any color you could give on that.

Yes. We just -- like I said, the statute of limitations is up on the property claims happened at the end of February when we hit the 2-year mark. And so those that have come in. We don't have a lot of information. We're early in the process. But our goal is to work expeditiously through them, like we have through our settlement process, I think we've had -- we've been very successful with over 300-plus claims and lawsuits settled. And the way to think about it, Anthony, is we have low-end accrual of $460 million. We've finalized settlements of approximately $400 million. So it's really that $60 million delta there that were kind of the low-end estimate and we'll continue to provide updates on a quarterly basis, but we feel really good about what we've done so far.

Congrats on a good quarter.

Our final question will come from Steve D'Ambrisi from RBC Capital Markets.

Just quickly on what are these -- what do you think that large loads do for earned returns or structural under-earning that you have in any of your jurisdictions as they come online? The reason I ask is just clearly you have a 9% EPS CAGR out there, but rate base growth is very front-end loaded and the capital plan is back-end loaded, and we've talked a lot about adding incremental capital to the plan, mostly in the tail end. So I just want to understand kind of what the shape of earned returns looks like as you see rate base growth accelerating?

Yes. I mean, I think as our shape of earned returns, we always talk a little bit about closing the gap, particularly in Colorado when we're working through some stuff and filed rate cases that will go into effect next year in terms of full annualization of the rate cases. We've always talked about structurally, there's 50-plus basis points of this structural lag. So we'll continue to work on that. In terms of -- you say data centers, I think, just about overall sales growth, whether it's oil and gas growth that we have down in SPS, we have really diversified growth. It starts to give that opportunity whether it's driving better returns in between rate cases or really just staying out of rate cases longer term as you start to see the sale of growth materialize.

And I think that's a really great opportunity. Not only can you bring affordability benefits with these data center loads, but how does it help you stay out of rate cases over the long term. Now we still have a while in terms of those data centers need to start to ramp up late in this period, but I do think that's a great long-term opportunity on both sides, affordability and driving earned returns.

That concludes the question-and-answer session. I'll now turn the call over to Brian Van Abel for closing remarks.

Thank you all for participating in our earnings call this morning. Please contact our Investor Relations team with any follow-up questions. Have a great day.

That concludes today's meeting. You may now disconnect.

Hello, and welcome to Xcel Energy 2025 Year-end Earnings Conference Call. My name is Jordan, and I'll be your coordinator for today's event. Please note, this conference is being recorded. [Operator Instructions]

I'd now like to turn the call over to your host today, Mr. Roopesh Aggarwal, Vice President, Investor Relations, to begin the conference. Please go ahead, sir.

Thank you, Jordan. Good morning, and welcome to Xcel Energy's 2025 Year-end Earnings Call. Joining me today are Bob Frenzel, Chairman, President, Executive Officer; and Brian Van Abel, Executive Vice President and Chief Financial Officer. In addition, we have other members of the management team in the room to answer your questions if needed.

This morning, we will review our 2025 full year results and highlights, provide updated 2026 assumptions and share recent business and regulatory updates. Slides that accompany today's call are available on our website.

Some comments during today's call may contain forward-looking information. Significant factors that could cause results to differ from those anticipated are described in our earnings release and SEC filings. Today, we will discuss certain metrics that are non-GAAP measures. Information on the comparable GAAP measures and reconciliations are included in our earnings release.

As a reminder, we recorded a charge of $300 million or $0.38 per share in 2025, reflecting the settlement in principle reach with plaintiffs in the Marshall out fire. As a result, our GAAP earnings for 2025 were $3.42 per share, while our ongoing earnings, which exclude this nonrecurring charge of $3.80 per share. All further discussion on our earnings call will focus on annual ongoing earnings. For more information on this, please see the disclosure in our earnings release.

I will now turn the call over to Bob.

Thank you, Roopesh, and good morning, everybody. At Xcel Energy, we continue to deliver a once-in-a-generation opportunity to meet the increasing demands of our customers as they electrify more parts of their lives to support the economic development of our communities, to fuel the rapid growth of AI and data centers and to continue to lead a clean energy transition in the country.

Over the next 5 years, Xcel Energy expects to invest in excess of $60 billion to modernize and expand the grid, adding advanced transmission and distribution infrastructure. New natural gas and renewable generation, smart weather-hardened infrastructure. These upgrades will strengthen sustainability, reliability and resiliency while keeping our customer bills as low as possible. We've also continued our decades-long track record of producing strong results for our owners. In 2025, Xcel Energy delivered ongoing earnings of $3.80 per share, marking the 21st consecutive year of meeting or exceeding our initial ongoing earnings guidance. We achieved that outcome with some of the lowest electric and natural gas bills in the country. This consistency reflects the strength of our strategy, the diversity of our business and the dedication of our Xcel Energy team who show up every day with safety, reliability, affordability and sustainability as their top priorities.

2025 showcase what our people are capable of as we reach several important customer and operational milestones. With our disciplined execution and geographic advantage for renewables, we continue to deliver for our customers. Our residential electric customers in Colorado have the lowest share of wallet out of all 50 states. And average electric bills in our other states occupy 5 of the top 11 spots in the country. Since 2020, residential electric bills in Denver and Minneapolis have grown far less than inflation, and less than common expenses like groceries, gasoline, health care, insurance and housing. And when compared to other national electricity providers, these bills have grown 40% and 80% less than other regions. A testament to our focus on affordability, our productive regulatory jurisdictions and importantly, our integrated regulated utility model that allows for long-term asset investment.

Also a testament to our One Xcel Energy Way continuous improvement program that has realized over $1.5 billion in cumulative savings since 2020, while also improving customer and operating outcomes. As a result, when looking at our 5-year average O&M expenses per megawatt hour, Xcel Energy ranked fourth lowest out of our peer utility companies. And even with some of the lowest energy bills in the country, we know some of our customers still struggle they can't meet. In 2025, our energy assistant programs reached nearly 200,000 customers and provided nearly $200 million in funding our highest ever 1 year total. Our focus on reliability, affordability and customer service was recognized by J.D. Power, who ranked Xcel Energy in the top quartile for the Midwest region and had the second highest score for customer satisfaction.

Across our 8 states, we continue to build and maintain the critical infrastructure that supports our customers' energy needs. In 2025, we invested nearly $12 billion, our largest 1 year total. In September, Phase 2 of our Sherco Solar project started commercial operation and the third phase will come online in 2026. And once complete, Sherco will be the largest solar facility in the Upper Midwest. We also completed the conversion of our 1,000-megawatt Harrington coal plant to natural gas, which provides essential energy resiliency and reliability to our customers, and we source and deliver that natural gas for Harrington from the Permian region, and that combination will benefit the local community for years to come. We completed 370 megawatts of wind repowerings at our border and Pleasant Valley facilities in the Upper Midwest and expect $750 million in PTC benefits which exceeds the investment that we made into these facilities, creating more affordable energy for our customers.

We placed a 325-megawatt Rocky Mountain Solar project in service this year, our first utility-scale solar farm in Colorado, with many more to come. And we released our updated 2026 to 2030 capital plan, which includes relative to our previous plan initial 7,000 megawatts of company-owned renewables, natural gas generation storage across our states transition our fleet and build for growth.

Speaking of enabling growth, over the past 15 years, Xcel Energy has been the leading builder of new transmission line miles in the country. Last spring, we energized our first 2 segments of the Colorado Power pathway, ahead of schedule, on scope and under budget, delivering significant value to our Colorado customers. The remaining segments will be energized in 2026 and 2027. Across SPP and MISO in '25 and '26, Xcel Energy has been awarded over 760 miles of new 765 kV transmission lines. This includes a second 765 kV line in FTP that was awarded this week, which gives us line of sight to $1.5 billion in additional investments over our base 5-year plan. These will be the first voltage lines of this class in SPP and constitute 20% of the approved new ultra-high-voltage transmission in this country, recognizing Xcel Energy's expertise in building and operating transmission networks.

We also reached several milestones as we continue to make investments to protect our customers and communities from the threats of extreme weather. In 2025, we rapidly accelerated system investments, including completing 8x as many pole inspections and 25% more pole replacements than the previous year and we installed over 250 Pano AI cameras and weather stations. In 2025, we received approvals from both Colorado and Texas Commissions for our wildfire mitigation and system resiliency plans as well as published Wildfire Mitigation Plans in each of our other states. Favorable wildfire legislation passed into law in Texas and North Dakota, and we're working on similar frameworks in other states. We continue to improve and refine operational measures to protect our communities, including daily wildfire risk monitoring, proactive customer communications wildfire safety operations and in very rare circumstances, public safety power shutoff capability.

And our investments are paying off. During winter storm firm this January, our electric and natural gas operations across NSP, PSCo and SPS performed exceptionally well. Thanks to rigorous winter readiness, proactive fuel management and strong coordination across our operations teams, we reliably serve customers through periods of high demand, and strained gas supply and challenging weather. And we were able to export our generation length when the system needed us most, providing grid stability and incremental customer benefits. Our operators and field crews executed cold-weather procedures flawlessly. We maintain system reliability and manage costs responsibly despite record-setting conditions.

I'm very excited about our achievements in 2025. I want to turn to our strong start to 2026. Today, we are advancing our data center pipeline with a new recently signed ESA with a large data center in the Upper Midwest. The Springs Xcel Energy to over 2 gigawatts of new contracted data center capacity. Our goal for '26 is another 1 gigawatt bringing our total to 3 gigawatts of contracted center service by the end of 2026. While we had length in the upper Midwest this winter and forecast so through the end of the decade, we also know that it's critical that we have the right resources to develop new generation infrastructure to deliver on the opportunities in our 20-plus gigawatt large load pipeline. So earlier this week, Xcel Energy announced an MOU with longtime partner NextEra Energy to co-develop generation, storage and interconnections to serve data center projects across our operating companies.

By engaging early with leading developers like NextEra, we can better anticipate system needs for new data centers. Streamline development time lines, advanced innovative grid technologies continue to provide the network benefits that data centers bring to all of our customers. With this agreement, we now expect to have 6 gigawatts of total data center capacity contracted by the end of 2027, with electricity sales and generation investment that will ramp into the 2030s. We will deliver the benefits of 2 of the best development teams in the industry to meet this moment for our country and our customers.

As we've talked about over the past 2 or 3 years, execution against our capital and growth plans are critical to our stakeholders. We believe that our scale and our diversity are assets that we can deliver to the benefit of our customers and our regions. We have strategic agreements in place with multiple Tier 1 EPC firms across our portfolio of renewable natural gas generation projects as well as transmission distribution and natural gas systems. And earlier this week, we announced a landmark strategic alliance with GE Vernova to support our growing portfolio of wind and natural gas generation, transmission, distribution and technology projects into the 2030s. This partnership will focus on delivering key benefits to Xcel Energy's customers and stakeholders to enhance certainty of supply, operational flexibility and cost affordability.

Each of the partnership is a mutual commitment to innovation and strategic collaboration. We will work together to explore advancements in areas such as artificial intelligence, grid modernization and joint research and development programs. As a first step, Xcel Energy is purchasing 5 additional natural gas turbines from GE Vernova, bringing our total to 24 gas CTs on order across our vendors. Additionally, we're integrating GE Vernova into our renewable energy pipeline bidding several gigawatts of wind projects with GEV turbines in our pending and upcoming RFPs. We Combined with agreements with other equipment, engineering construction firms, Xcel Energy has built scalable, resilient and flexible engine to ensure delivery of critical system investments. This engine has also enabled us to safe harbor equipment for approximately 20 gigawatts of renewable generation storage, preserving a significant volume of production and investment tax credits for the benefits of our customers.

Finally, Xcel Energy's commitment is about much more than energy. The heart of what drives our people is a deep compassion connection and commitment to the communities that we serve. That's because these communities are not just customers who receive our energy because our people live in the same neighborhood, our children attend the same schools, and we attend the same community events. And so it goes without saying that the tragic events across the twin cities have weighed heavily on our communities, our customers and our employees. We've engaged extensively and proactively with senior federal, state, local and community officials with a goal to de-escalate and identify a sustainable path forward.

I was pleased to sign on to the letter with 60 other Minnesota companies urging for a solution. And alongside other peer companies in the Twin Cities, the Xcel Energy Foundation has committed to help fund the Minneapolis Foundation support local and small businesses impacted by recent events. I know that our Xcel Energy community will continue to do what we do best, making Energy work better for our customers while supporting our teammates and caring for our neighbors. Looking at the broader community engagement in 2025, Xcel Energy initiated 15 economic development projects for our local communities, which are projected to create more than $7 billion in capital investment in nearly 1,400 jobs. Additionally, nearly 53% of our supply chain spend was local, and we spent nearly $1 billion of small and diverse suppliers.

Xcel Energy employees, contractors and retirees supported by the company's foundation provided over $14 million and over 60,000 volunteer hours to support over 400 local charitable organizations and causes in 2025. And for the 12th year, Xcel Energy was honored as one of the world's most admired companies by Fortune Magazine. We ranked first in social responsibility and placed fourth among the most admired electric and natural gas companies in the country. I continue to be thankful and grateful for each of our employees and partners who shared their time, resources and talent this year to make energy work better.

With that, I'll turn it over to Brian.

Thanks, Bob, and good morning, everyone.

Starting with our financial results. Xcel Energy reported ongoing earnings of $3.80 per share for full year 2025 compared to ongoing earnings of $3.50 per share in 2024. The most significant earnings drivers for the year include the following: higher electric and natural gas revenues due to rate case outcomes, nonfuel riders and sales growth, partially offset by higher fuel and purchased power expenses increased earnings by $1.21 per share and higher AFUDC increased earnings by $0.27 per share. Offsetting these positive drivers, higher interest charges and common equity financing decreased earnings by $0.46 per share, reflecting funding of our infrastructure investments and financial discipline to maintain a strong balance sheet. Higher depreciation and amortization decreased earnings by $0.28 per share, reflecting our capital investment programs. Higher O&M expenses decreased earnings by $0.25 per share and other items combined to decrease earnings by $0.19 per share.

Turning to sales. Full year weather adjusted electric sales increased by 2.2%, driven by increased C&I load in SPS and PSCo. For 2026, we continue to expect full year weather-adjusted electric sales to increase 3%. Shifting to expenses. O&M expenses increased $190 million in 2025. Increases are primarily due to accelerated wildfire mitigation costs in Colorado, excess liability insurance costs, higher benefit costs in late third and fourth quarter 2025 and increased costs from generation maintenance.

Moving to regulatory activity. During the fourth quarter, in Colorado, we filed both electric and natural gas rate cases. We anticipate commission decisions on each and the implementation of new rates by the end of Q3 2026. In November, we filed a New Mexico electric rate case and anticipate a commission decision in the second half of 2026. And in Wisconsin, we received final approval for our electric and natural gas rate case and implemented new rates in January.

As we look to additional investments to our base capital plan, Xcel Energy has 10 to 12-plus gigawatts of additional generation RFPs and transmission opportunities in SPP and MISO. These investments align with our improved resource plans and are critical to ensure we have the energy we need to see our customers, retire legacy generation and ensure reliability. These RFPs also help capture expiring production and investment tax credits, which will help keep customer bills well. For the recommended portfolio in Colorado near-term solicitation, we are now expecting the commission to review these resources in multiple tranches through early 2026. Additional needs under our approved IRP will be subject to RFPs later this year.

In December, we issued an RFP and NSP for 4,100 megawatts of renewable generation and storage to be placed in service by 2030. Bids are due in March, and we expect a recommendation filing later this year. In October, we issued an RFP and SPS for 1,500 to 3,000 megawatts of additional nameplate generation. Bids were received in January, and we expect to report from the independent monitor in late Q2 2026. And finally, as Bob mentioned, in SPP, we were awarded another 765 kV transmission line, which gives line of sight to $1.5 billion of additional investment over our base 5-year plan.

We also continue to make strong pressure on the Smokehouse Creek wildfire claims process. We resolved 222 of the 287 submitted claims. We've reached settlements with 79 of the 83 potential claims presented for mediation by parties represented by attorneys. And finally, 22 of 47 complaints have been settled or dismissed. We have updated the lower end of our estimated liability to $430 million. We have committed $382 million in settlement agreements, including agreements with the subrogated insurer plaintiffs and the 3 largest claims by acreage. As a reminder, we have approximately $500 million of insurance coverage. Regarding the Marshall wildfire settlement, Xcel settlement agreements have been executed with the subrogation insurers in nearly all individual plaintiffs. Xcel Energy is aware of 3 individual plaintiffs out to 4,000-plus who have not yet accepted a settlement or otherwise stopped prosecuting their claims.

Moving to guidance. We are reaffirming our 2026 EPS guidance range of $4.04 to $4.16. We remain confident in our ability to deliver 6 to 8-plus percent long-term earnings growth and expect to deliver 9% EPS growth on average through 2030. Updates to key assumptions are included in our slides and earnings release.

With that, I'll wrap up with a quick summary. Xcel Energy posted strong ongoing 2025 earnings of $3.80 per share, meeting or exceeding ongoing guidance for the 21st consecutive year. We continue to lead the clean energy transition while ensuring safe, clean and reliable service and keeping customer bills as low as possible. We continue to make progress to realize our $10-plus billion pipeline of additional investment opportunities including a new 765 kV awarded in SPP this week. We've announced 2 strategic alliances with industry-leading development and supply chain partners to ensure we have the resources technology and capacity to deliver on our capital plan. We now have signed ESAs for over 2 gigawatts of data centers and remain on track to contract 3 gigawatts total by the end of 2026. In addition, we have updated our plan to contract 6 gigawatts of total data center capacity by the end of 2027.

We continue to maintain a strong balance sheet and credit metrics using a balance of debt and equity to fund accretive growth. We are reaffirming our 2026 EPS guidance of $4.04 to $4.16 per share. And finally, we remain confident in our ability to deliver 6% to 8-plus percent long-term earnings growth and expect to deliver 9% EPS growth on average through 2030. This concludes our prepared remarks. Operator, we will now take questions.

Your first question comes from the line of Julien Dumoulin-Smith.

It's [indiscernible] on for Julian. Just I want to just understand more clearly what the upcoming filings in Colorado for the JTS and how that ties into the large tariff filing, should we expect as you sign customers to the large tariff, you'll then submit the capacity need to the commission and issue an independent RFP for like? Or will you, I don't know, group them together to make the process more efficient? And then how does that tie into that 6 gigawatt target by 2027?

Yes. I can start with that answer. And if I didn't answer all the pieces of that question, just feel free to chime in.

As we think about it, we're aiming to file that large load tariff in Colorado early in Q2 and work through that regulatory proceeding in Colorado. And once we have that kind of large low tariff in that construct, we'll seek to bring forward large loads within that framework, along with likely a package of generation to serve that large load. They're really focused on driving customer benefit for all of our current customers. So that's really the timing in terms of getting the large load terrifiling in Colorado. The kind of 6 gigawatts, right, we doubled our data center expected contracted capacity from 3 gigawatts to 6 gigawatts. That 6 gigawatts is contemplated across our system. Right now, you saw the one we just signed is focused on upper Midwest, and I think that's our focus on the Upper Midwest right now. We have some really good opportunities that we're working through.

And as we work through the large load tariff, like not only in Colorado, but Texas and New Mexico will seek for opportunities there, too.

Okay. Great. And then just to follow on that. The $10 billion CapEx pipeline, right? That only includes kind of that low end of the 5,000 to 14,000 gigawatts of range of potential capacity, data center-driven needs in Colorado, right? So there's notable upside even of the $10 billion?

Yes, that's absolutely a fair characterization as we think about it. And really, that kind of -- that low end didn't include significant data center growth in Colorado. So as we look at data center opportunities there after the large Latera filing, it would include additional generation to serve those resources.

Your next question comes from the line of Jeremy Tonet from JPMorgan.

This is [ Diana Niles ] on for Jeremy. So my question is considering data centers coming online in the coming years, how should we think about that ramp to sales care reaching 5% across service territories? And do you still expect 3% of this 5% from data centers?

Yes. Thanks for the question. This is Brian. We'll update our 5-year sales forecast as we typically do on Q3. That 5% sales CAGR was based on the 3 gigawatts of data center that we had all tied in our last Q3 update. Clearly, we've updated that from 3 gigawatts to 6 gigawatts. But I think there's some of that when you look at the timing, and we expect to have these contracts signed by the end of 2027 and the construction cycle, a lot of those may come in kind of that 29 type period. And then it's really about energizing into 2030 and the early 2030s and about extending our capital investment opportunity, our generation need.

So certainly, significant sales growth opportunity, but we think about it more in this later part of this 5-year of driving significant growth, significant sales growth and benefit for our other customers into the 2030s to what extent. So it's really about extending our growth opportunities, sales growth, capital investment growth and benefit to our current customers.

Okay. And then on the smokehouse Creek, I saw the low-end estimate rose about the same amount as the finalized settlement agreement. So those like estimated losses to the low end, stay around $50 million. Just wondering how many lawsuits that $50 million might represent and sort of how sticky finalizing those might be?

Maybe I'll take a step back and try and answer that question. I think we've made really good progress. If you look at just in the number of claims we've settled. We have over 320 claims settled and about roughly 420 claims and lawsuits in total. So we've settled on a significant number, only about 90, about 100 outstanding. And I think you look at, and I've talked about it before, is we've settled some of the largest claims. We sell the 3 largest claims of acreage, which are high-value ranches. We settle with our subrogation insurers. So when I think about it, we've made considerable progress from this time last year to today. At this time last year, we just had over 100 settlements, and now we have 3x at amount.

So we'll continue to evaluate it. we expect to get some additional claims in as we near the 2-year deadline, and then we'll evaluate it like we do every quarter, but we continue to make really good progress on the overall claims. And again, it's a low-end estimate, but we feel good when we think about -- we have $380 million of that $430 million is already settled. And so it's really our low-end estimate is focused on that $50 million relative to about $120 million of insurance proceeds left when you look at our coverage amount.

Your next question comes from the line of Carly Davenport from Goldman Sachs.

Maybe just to start on the partnership with NextEra. Could you talk a little bit more about the roles that each of you will play in developing these data center projects? And maybe if there are any time-to-market advantages given that is still the top priority for data center customers?

Carly, it's Bob. Thanks for the question. The last time we got together, maybe it was in the third quarter last year sometime, we talked a lot about executing on a capital backlog plan, executing on a data center, large load plans for the company and really finding the mechanisms that allowed us to execute in totality across the company. And I think what you heard from the team today, was execution across all 3 of those areas.

With regards to NextEra in particular, you used a word that I use a lot here, which is speed. So we do think there'll be increased clock speed as we think through combining to the best sales team, to the best development teams, to the best analytical teams in the country to deliver solutions for a very sophisticated customer set. We also think that it brings scale and the ability to put an inflection point in the curve of data center delivery and signed ESAs and contracts and ultimately, investment opportunities in all 3 of our big regions.

When I think about roles and role clarity, we're still at MOU stage, although I'd tell you a lot of the terms and conditions have been really agreed upon by the organizations. We've got to get to sort of final joint development agreement type framework, which I think we'll get to quickly. I think about us having a great backlog and visibility in conversations with hyperscalers and data center developers. We know NextEra has a national platform of this as well and bringing those 2 together and being able to sit in the room and compare notes of who we're talking to, where is the best place to do this as it pertains to our regulated footprint. And then where do we have generation that we can bring to the table that we need to bring to the table with speed, with certainty, with price transparency and with competitiveness.

I think that's what the teams are going to bring together collectively. It's not an exclusive arrangement, but we expect to do a lot of work through this agreement, and it's not fuel type limited. If you think about where we sit in sustainability goals as a company where these hyperscalers and data centers and customers of data center developers want to be. It's a highly sustainable product. And no one's delivered more wind or solar or storage development across the country than NextEra. And we've been 20-year partners with them. We signed our first PPA with them in 2006, our first PSA for a development transfer a decade ago. So this is a great working relationship. All we're doing, I think, here is codifying it for the purposes of speed and execution certainty.

That's super helpful. And then maybe just the follow-up. Just there are a number of elections across your states this year. Any early views in particular on Minnesota and Colorado, where you have ongoing rate cases and just sort of the role that you'd expect affordability to play in the respective campaigns?

Great question, something we pay a ton of attention to. And if you saw my heard my prepared remarks, I spent a lot of time talking about where I think we sit as a company in terms of affordability. Colorado, number one, lowest energy bills, electric and gas in the country. I think that's a great starting spot. We needed to file both electric and gas cases there. We've invested substantially into that state over the last 2 or 3 years. We haven't filed a case -- we did file a case at the end of last year, and I'll go through prosecution through the course of this year.

The election is probably early to tell. There's a lot of great candidates in Colorado for the governor. Two big names on the Democrat side. One big name on the Republican side of the ticket and probably early innings for us to see how that's going to play out in November Certainly, energy and energy goals for the state have been very critical. We know that one of the things the state legislature is going to look at is 2040 legislation for some clean energy standard that's been a Governor [indiscernible] priority for a long time. So we know that Clean Energy is going to be on the table. We are a huge leader here and in Colorado, and I think we got a great seat at the table when it comes to energy policy in that election.

In Minnesota, obviously, [indiscernible] just put her hat in the ring for the governor's election. And there's a prouded field of folks on the Republican side as well. So probably early innings to tell what might happen there. We've got a rate case here in soda that we've been prosecuting for about a year. We expect decisions here by, call it, midyear this year and potential to settle between now and then -- so I'm not certain how much the gubernatorial cycle will affect the outcomes of the cases that we have in front of us in Minnesota.

And Carly, just a couple of things to add. I mean we have -- I'll echo Bob's points on affordability. And we have a great affordability story while we're driving state energy policy in those 2 states. And so we're really aligned both on state energy policy and the affordability narrative.

And then if you looked at our Colorado electric rate case filing, we put forth an enhanced affordability proposal, really getting at our customers that do have a higher energy burden. And we propose something for customers that were at a 5% to 6% energy burden down to 2.5% and then combined electric and gas bill. So really looking at where can we address the affordability issues. We're pretty excited about where we sit from affordability story are narrative and -- but also looking to address it in the pockets where we can.

Your next question comes from the line of Stephen D�Ambrisi from RBC Capital Markets.

I just had a quick one about the -- frankly, the data center pipeline update. I think on third when you rolled out your formal financial plan, you had talked about roughly 3 gigawatts between the 2 buckets of contracted and high probability and that those 2 buckets would drive 3% of the 5% total sales growth. And so can you just give me a little color about now that, that combined bucket looks like it's doubling to almost 6 gigawatts. What does that mean for your sales growth? And then kind of the attended question would just be, as we get clarity on some of the high probability pipeline when do we see -- do we see updated IRPs that reflect some of this load incremental load growth? And just how does that filter down into capital ultimately?

Steve, thanks for the question. And absolutely right, in terms of everything we said on the Q3 call, 3 gigawatts of data centers in our high probability bucket. We also said on the Q3 call that we would execute on 2 gigawatts by this time. And we did execute on 2 gigawatts is time. So we want to ensure that we're delivering on what we tell our investors because I think that's really important.

And so we feel that we have clear conviction by essentially doubling our data center opportunity from 3 gigawatts to 6 gigawatts. And so excited about that. In terms of our sales forecast, that 3 gigawatts translated to 3% of the 5% growth. We'll provide a holistic update in Q3 like we normally do when we roll forward our 5-year sales forecast plan, but certainly an opportunity. Although I do think if you look at the timing of when you'd execute an ESA, if we say through the end of 2027 and kind of think about that cycle, you might see a lot of these coming in, maybe that '29, '30 as they energize and then ramp up into the 2030s. So I think there's really the opportunity is how do we think about extending our growth beyond 2030. So some potential sales impact within this 5 years, but really, it's post 2030 as we think about these, particularly with the, call it, the very large data centers, the 1 gigawatt plus where they ramp up over time.

And then you would see there's really 2 ways that could come in through our [indiscernible] if they come in through the research planning process. Certainly could come into the research planning process, but I think more often, you'll see them come packaged with an ESA. In terms of we're going to bring forward a specific data center and here's the package of resources that we'll serve it with because then that can really demonstrate to our commission that we're driving customer benefit for all of our current customers when we're looking at how we're going to serve those data centers. So I think that actually gives us more flexibility than kind of your standard resource planning process that can take a significant amount of time if you just go through that.

Steve, it's Bob. I just add on to what Brian said is, look, we're going to expect some modest sales this decade, and we'll have to update our plan accordingly. We'd expect to start investing probably capital to build the generation to serve those sales in the later part of this decade as well. We'll update our capital plan accordingly in the third quarter. And I'd just say, give us a little bit of time with the NextEra partnership to figure out how fast we can get our feet underneath us, how fast we can run and how fast we can bring this stuff to the table. So give us a little bit of time and we'll keep this group informed as we go through the year and certainly a fulsome upstate in the third quarter.

Yes. And I think about it, we have that $10-plus billion pipeline slide you look at our current base capital plan in terms of we have very strong growth and investing for our customers in the front 3 years, but then it's how do we fill in and strengthen that pipeline in year '29 and '30 and beyond. So that's a really good way to think about it, deepening our pipeline of opportunities and extending that pipeline of opportunities post 2030.

Great. That's helpful. And then just one other one quickly. Just you had mentioned that maybe the Colorado near-term RFPs were going to get bifurcated or tranched out, I guess. And so can you just talk about -- I think it was the proposal was 2.1 gig company-owned across the portfolio of 4.9 gigawatts. And so what does that look like in this tranching out and looks like the time line around some of these trench updates, I guess?

Yes. And the commission is working through the deliberation. So kind of what -- at least as we understand is sitting here today, they approved about 1 gigawatts of projects including our gas plant in the last set of deliberations. And then they asked for some additional analysis over the next, call it, 1 or 2 months that we're working on expeditiously. And so they're going to look at a new portfolio, which could potentially include up to 1 gigawatt of our company-owned solar plus storage in that next tranche.

And then potentially a tranche 3, the timing is unclear, but likely in the first half. So we'll work with our stakeholders. Obviously, we brought forward this near-term procurement with a number of our key stakeholders in the state to really drive projects ensure they come online before the tax credits expire. So we will continue to work with the stakeholders about the importance of that from a customer affordability perspective. But if anything doesn't get picked up in the near-term procurement, it just shifts to overall resource plan, the just transition plan that is in flight. So it's really -- this is a subset of what we expect to execute in the resource plan, which will be follow-on RFPs later this year.

Next question comes from the line of Nicholas Campanella from Barclays.

I'm really sorry, I just -- I jumped on late from another call, but I just wanted to kind of clarify the 6 gigawatts now is pressure higher on the 5% long-term low growth factor. Is that correct?

Yes, Nick, that's correct. And we really think about it in terms of our -- like we said, we doubled our data center expectations here from 3 to 6 when you peel back from Q3. Obviously, I have clear conviction because what we put on our slides, we expect to execute on. And so that does provide sales growth opportunity in that.

What I would expect more in the '29 to '30 time line, when you look at kind of the schedule and what it takes from an executing ESA to the energization, so the way we look at that is really later in this sales forecast are really prolonged into 2030 when you think about the ramp schedules on some of these very large data centers, multiple year ramp schedules, which means a multiple year generation build up for us as we think about it. So deepening the opportunity in late in this 5 year and extending our opportunity in the 2030s.

All right. That's great. That's great. I'm sorry, if I may repeat yourself. And then maybe just like when we kind of look at the earned returns just for '25 actuals, they are pretty significantly under authorized. So can you just kind of talk a little bit about just the path you authorized and what's embedded in the plan. I'm specifically kind of thinking about Colorado as well as SPS and where you kind of see your own ROE trending as you get to -- on your side of these cases?

Yes. Thanks, Nick. I think SPS is -- we had pretty challenging weather in the Q4 in SPS and a couple of other unique items in '25. So I expect that to get back closer to where it's been in the last few years as we get ride of recovery, and we have a New Mexico rate case in flight that we filed last year.

Colorado specifically, yes, significant under earnings. But I think maybe refresh from that perspective, we really wanted to get through the Marshall trial and get a constructive settlement with that respect. And we did. If you didn't catch the opening remarks, we only have 3 known plaintiffs left to settle out of 4,000 plaintiffs. So we feel really good about where we are with that. We filed the Colorado Electric and the Colorado gas case here late last year. So from an ROE improvement perspective, those cases play out and we expect revenue -- a decision in revenue late Q3 of this year. So some revenue in the door this year, but you see the full impact on annualization of those rate cases in '27. So expect significant ROE improvement from where we landed in 2025 in Colorado in '27 as we think about those rate cases.

And then the last one, if I could, and I appreciate all those answers, Brian. Just maybe clarify what's kind of embedded in the low end of this $10 billion plus incremental bucket. It just seems like there's potential for is to be well above that figure. So is there any way that you could kind of began that if we're thinking about at minimum, what could kind of be coming into the next full year update when you typically do you refresh in the third quarter?

Maybe I'll walk through a couple of the markers that we're watching, Nick, to help you think about how we're going to roll forward this year into Q3. We have -- if I think through the significant RFPs that we have outstanding, we talked about the Colorado near-term plan, which the commission is looking at approving in tranches, but we should have visibility on that as we work through the next several months.

The SPS RFP for 15 to 3,000 megawatts of nameplate capacity. We already received the bids, and we're working through the analysis of those bids and the independent monitor will make a filing in Q2. So we'll have visibility on that opportunity. And then the significant opportunity in Minnesota with 4,100 megawatts renewables all in service by 2030 to really capture the tax benefits for the benefit of our customer. And so those were -- that's likely a filing later this year. So you'll have visibility but certainly not regulatory approval on that. But that's a really important filing as we think about accelerating projects for our benefits of our customers in the Midwest. So that's kind of the generation side on the current outstanding RFPs.

We just this -- earlier this week received approval of a 765 kV transmission line in SPP, in SPS, $1.5 billion for the 765 line. So clearly, we'll roll that into our plan. That's COD by the end of 2030, all within our 5-year plan. And then we think about all the data center upside we have as we look at bringing on potential data centers and the generation that would come with that. So there's a reason why we put a plus next to that $10 billion. We feel really good about these opportunities. and we think about filling in our '29 and '30 investment pipeline and then extending it into 2030 and beyond that. So I don't think there's a high-end number to put that beyond, we feel really good about these opportunities.

And the partnership that we talked about with GB, the data center joint development agreement that we're working on with NextEra, just kind of strengthens that pipeline. And also when we think about these data centers, it's really about driving benefit for our current customers to really important as we think about when we bring forward some of these data center opportunities.

Your next question comes from the line of Travis Miller from MorningStar.

I wonder if you could quickly go over what's the regulatory process for some of these ESAs that either you're signing now or that you're negotiating in the upper Midwest understand the Colorado situation. But what about in the Upper Midwest?

Yes. So we announced an additional data center deal just on this call, as Bob talked about in his remarks. There will be a regulatory filing in upper Midwest associated with that and then commission approval associated with that. It's still confidential, so we won't -- we can't speak much about it. But we look forward to bringing those details and there'll just be a regulatory approval, really important in terms of showing overall benefit. And so think about that if we have a large load tariff filing in place, we'll align with that large load tariff filing, and that should help from a regulatory approval process. So that's the best way to think about it, get the large lot tariff filings in place and then move forward with specific ESAs that align with that.

And Travis, those tariffs are in process in Minnesota, Wisconsin, Colorado, Texas, and I may miss the statement there. But our goal is to get large load tariffs and then sign contracts underneath those tariffs that resemble those and that should be the sort of regular path for data center contracting.

Okay. Can those data centers come online before those large on tariffs or not? I guess just under [indiscernible].

Yes, we would align -- and I think it's helpful to understand we have 1 data center that's already energized, we have 3 data centers that are energizing in 2026. And we can -- we just make sure we align those ESAs with the large loan tariffs. So yes, they can. It's just important -- and we've been very clear not only with our stakeholders, both our investors about the importance of those principles and how we manage both benefit for our current customers and manage risk to our customers and the company for these large loads.

Okay. Got it. And then Harri level, obviously hearing a lot around the country, et cetera, about bringing your own generation. What does that look like in your area? Are you seeing data centers bringing their own generation, make them proposals. And then if you're seeing that or even you anticipate seeing that, what does that mean for your system and reliability? How does that all work together?

Yes. Travis, this is Bob. I think the bring your own gen is a maybe a new [ Monic ] construct that is sort of -- if you're -- we don't want you to take existing supply out of the stack. It doesn't necessarily mean that data centers are going to show up with their own generation per se. We think that as you think -- as you look across the country and the sort of different regulatory frameworks that are out there, we think data centers by and large, in our conversations with them have affirmed this that they don't really want to own and operate their own generation. They'd rather have someone own and operate for them.

In a deregulated market, that means we're working with the developer to build that generation leave it through a regulated utility and sell it to the customer. That seems a normal path for a deregulated market. For our markets, it would be we want to bring incremental generation to the to our networks to support these new large loads. And in doing so, when you bring that generation, you price protect your existing customer base from any incremental costs that may come from that new generation and then the shared benefit comes from taking this big fixed asset, we call it the grid and spreading that across more units of production. And that's where all customers will benefit by bringing large loads in. And if you can protect them from the price side of new generation, which we think we have the capability of in all of our states I think that's how I think about bringing your own generation across the country.

There will be some developers that will build their own generation over time, but we think that's a pretty small set of data center developers and hyperscalers.

Okay. That makes sense. And then one real quick one. The Colorado, if you get that large load tariff in place, is that upside to the 6 gigawatts, I think you had mentioned that you could see more projects or more interest come in once you've got that? Or is that embedded in the 6 gigawatts?

When we think we have not specified where those -- well, we have 2 gigawatts under contract, we have not specified those remaining 4 where they will come from. We have significant interest across all of our service territories and operating companies. I think we're most focused in the upper Midwest and the near term as we move forward. But interest across all operating companies. And I think we put that [ 60 ] goes up there, but that's through 2027. You don't stop there. You continue to look at how can we drive overall data center developments beyond that. So I would think we'll continue to provide updates on that, but it's just -- we have -- we haven't given anyone the specificity. We have a large pipeline across all of our territories.

Your next question comes from the line of Paul Patterson from Glenrock Associates.

Just have one question left on the SPS is these power shutoffs and sort of some of the news that's come out about them on -- from the fire districts and from these lawmakers. Just could you elaborate a little bit? I know you guys are working hard on this issue. And obviously, it's a safety issue that you guys are focused on. Just any thoughts on this that we've been seeing a bit of stuff coming out of Colorado on this?

Paul, it's Bob. Look, let me start with we are absolutely 100% committed to protecting the communities and our customers from the risk of volatile weather and wildfires. And we absolutely don't take lightly the need to potentially turn the power off in selected locations for short periods of time to protect them. We have spent an enormous amount of time, energy, effort and investment in making our system harder, making our operational intelligence better and minimizing the scope and the impact in the number of these items. And we expect that to continue as we go forward in time.

We continue to operate under a wildfire mitigation plan in Colorado and a system reliability plan in Texas. That's going to help us continue to further segment our system, continue to build out the operational intelligence and the ability to continue to minimize the impact of these occurrences. I will share with you though that the December outcome in Colorado was some high winds and a potentially dangerous situation in Colorado. So we stand by our decision, we took the right action. And all what we're trying to do is minimize the impact on our vulnerable customers when we have to do that. And so we're working on a battery pilot for our -- for durable medical good customers. We are increasing our collaboration and partnership with our local partners, and we had enormous amounts of support from the broad community, the OEMs, the counties, everybody in the fire districts.

So we feel good. It's not our preferred choice of action, but we are absolutely going to protect our customers and our communities from the risk that we cause a catastrophic wildfire.

Absolutely. No. I guess my question is sort of like, I guess, I'm a little bit surprised by sort of some of this reaction. Is it a communication issue, do you think? I mean I just observe -- I mean, obviously, you guys are you're not taking this lightly. So I just in terms of you're doing it to protect people. So I guess what I'm a little surprised by us is sort of this pushback or at least the coverage of it, do follow what I'm saying of -- is this an issue of communication do you think that ample don't really -- that's -- I apologize. That's what my question is.

Our year-over-year performance between 2024 and 2025 was a remarkable improvement in terms of our coordination, our early warning and our performance and our restoration times. Certainly, room for improvement. We work hard on communication. We work hard on outage maps or investing in technology to do that all part of our road map.

I think one of the challenging things for people just to understand is, sometimes you may be in circuit that gets turned off proactively. Sometimes because of the weather, you might be in a circuit that gets knocked down that we didn't proactively turn off. Some people are on, some people are off, they don't know why they're on, they don't know why they're off. And so we're trying to work through sort of real information sharing with our customers to make sure that we give them the best recovery times and the best reasons for why they may be out in a certain situation, and again, trying to minimize all of those as they happen.

There are no further questions. And with that, I'd like to turn the call over to CFO, Brian Van Abel, for closing remarks.

Thank you all for participating in our earnings call this morning. Please contact our Investor Relations team with any follow-up questions.

That concludes today's meeting. You may disconnect.

Hello and welcome to Xcel Energy Third Quarter 2025 Earnings Conference Call. My name is George, and I'll be a coordinator for today's event. Please note, this conference is being recorded. [Operator Instructions]

I'd like to call you over now to Roopesh Aggarwal, Vice President, Investor Relations, to begin today's conference. Please go ahead, sir.

Thank you, George, and good morning. Welcome to Xcel Energy's Third Quarter 2025 Earnings Call. Joining me today are Bob Frenzel, Chairman, President and Chief Executive Officer; and Brian Van Abel, Executive Vice President and Chief Financial Officer. In addition, we have other members of the management team in the room to answer your questions if needed.

This morning, we will review our third quarter 2025 results and highlights, share recent business and regulatory updates, update our 5-year capital and financing plan, and provide updated 2025 assumptions and 2026 guidance. Slides that accompany today's call are available on our website. Some comments during today's call may contain forward-looking information. Significant factors that could cause results to differ from those anticipated are described in our earnings release and SEC filings. Today, we will discuss certain metrics that are non-GAAP measures. Information on the comparable GAAP measures and reconciliations are included in our earnings release.

In the third quarter of 2025, Xcel Energy recorded a charge of $290 million or $0.30 per share, reflecting the settlement in principle reached with plaintiffs in the Marshall wildfire. Given the nonrecurring nature of this item, it has been excluded from third quarter and year-to-date ongoing earnings. As a result, our GAAP earnings for the third quarter of 2025 were $0.88 per share, while our ongoing earnings which exclude this nonrecurring charge, were $1.24 per share. All further references to earnings, drivers and variances in our discussion today will refer to ongoing earnings. For more information on this, please see the disclosure in our earnings release.

I will now turn the call over to Bob.

Thank you, Roopesh, and good morning, everybody. In the third quarter of 2025, Xcel Energy continued our commitment to our customers, our investors and our communities to make energy work better. During the quarter, we delivered solid earnings of $1.24 per share. We invested over $3 billion and $8 billion year-to-date in resilient and reliable energy infrastructure for our customers. We reached a comprehensive and constructive settlement with plaintiffs in the Marshall wildfire that helped our customers and our communities to move forward. And we accelerated our wildfire risk reduction efforts to protect our communities from volatile weather.

Based on our results through the third quarter, we are reaffirming our earnings guidance for 2025 and remain confident in our ability to deliver on earnings guidance for the 21st year in a row, one of the best track records in the industry. As per our usual Q3 rhythm, today, we are introducing our updated 5-year infrastructure investment plan designed to serve increased energy demand, make needed investments to strengthen our transmission and distribution systems, provide a cleaner and more sustainable energy portfolio and to keep energy safe, reliable and affordable for all of our customers. In total, we expect this plan to deliver 7,500 megawatts of zero-carbon renewable generation, 3,000 megawatts of natural gas-fired generation and almost 2,000 megawatts of energy storage to ensure system reliability, 1,500 new high-voltage transmission line miles to support demand growth in regional delivery and approximately $5 billion of investment in our distribution and transmission systems to improve resiliency and reduce future risk from wildfires. We're able to accomplish this plan because we have one of the best utility development and supply chain teams in the industry. And in combination with our strong balance sheet, we can deliver infrastructure timely and affordably for our customers.

In connection with this forecast, we have safe harbored all renewable and storage projects in our base capital plan and expect the same for the projects in our incremental plan to ensure that we can capture available tax credits and help keep customers' bills low natural gas on order, which will provide over 4 gigawatts of natural gas generation to help ensure reliability and affordability. Our ability to deliver infrastructure with excellence in our strategic geographic advantage allows our customers to benefit from some of the lowest energy bills in the country. Over the past 5 years, our residential electric and natural gas bills have been 28% and 12% below the natural average, respectively. Our residential electric customers in Colorado have the lowest share of wallet out of all 50 states. And the average residential bills in our other states occupy 5 of the next 11 spots. Since 2014, our residential electric and natural gas bill growth has been well under the rate of inflation. In fact, a typical residential Xcel Energy electric and natural gas bill is 14% and 20% lower than it was in 2014 when adjusted for inflation.

Our steel for fuel program has saved customers nearly $6 billion through 2025. And our one Xcel Energy Way continuous improvement program has realized over $1 billion in cumulative savings since 2020, while improving customer and operating outcomes. Our industry-leading demand side management programs have saved enough energy to avoid building 30 average-sized power plants. And as customers continue to electrify transportation in other parts of their lives that can further reduce their overall monthly energy costs with lower electric rates.

We also continue to support critical programs to help our customers who may need assistance with their energy bills. Since 2024, Xcel Energy has connected over 200,000 customers with almost $300 million in financial resources. We're also exploring new opportunities to help even more customers across our jurisdictions, including proposals in our current Minnesota, Wisconsin and upcoming Colorado rate cases. Moving to the topic of artificial intelligence artificial intelligence, opportunities for Xcel Energy go well beyond our ability to power data centers. Of course, our load interconnection queue continues to grow even as we move some of our backlog into the contracted category.

Across Xcel Energy, we are in early stages of using AI in the business to bend the cost curve and to provide improvements in both customer satisfaction and operational outcomes. We're harnessing AI to empower our people, accelerate innovation and build a smarter, more resilient energy future for our customers and communities. Automated analysis across our diverse enterprise data sources is delivering actionable insights that strengthen security, improve operations and planning and drive process improvement. We're bringing knowledge gaps in empowering faster, more informed decision-making across the organization. And we're leveraging AI built by others to advance our business, including high-resolution imagery to transform how we inspect and maintain our distribution infrastructure.

Through drone-based data collection and automated image analysis, AI-enabled processes can identify defects and assess risks and enable our teams to prioritize maintenance with greater speed and accuracy. And with wildfire mitigation, AI is transforming our risk models. By leveraging internal models and tools like Technosylva significantly improved our model coverage and accuracy as well as reduced analytical times to a fraction. This means faster, more reliable risk assessments protecting communities and infrastructure in real time. AI is truly an engine that's driving enterprise-wide innovation and transformation in Xcel Energy, making energy work better for our employees, our customers and our communities.

Moving to Marshall on September 23, Xcel Energy, Qwest and Teleport Communications America reached settlement agreements in principle that resolve all claims asserted by the subrogation insurers, the public entity plaintiffs and individual plaintiffs. And while Xcel Energy does not admit any fault or wrongdoing and disputes that our equipment caused the second ignition, we believe this provides a positive outcome for our communities and our investors. Looking forward, Xcel Energy continues to significant progress to mitigate risk from wildfires and extreme weather with public-facing wildfire mitigation plans in each of our states. This includes investments in situational awareness tools like weather stations and pane cameras, advanced meteorology, fire science and AI-enabled risk modeling tools, hardening our systems and deploying advanced wildfire safety operations and PSPS capabilities and operational actions, including daily stand-ups to address the threat from extreme weather across every part of our system and taking proactive actions as appropriate.

Finally, each September, Xcel Energy employees and community members come together to honor the spirit of service. This year marked the 15th annual day of service for Xcel Energy with nearly 3,000 volunteers from across the company and the communities we serve coming together to support local nonprofit organizations. Together, volunteers dedicated almost 9,000 hours of service across more than 100 projects. This is one of my favorite days of the year and it exemplifies the spirit and dedication of our employees and partners who show up every day to provide safe, clean, reliable and affordable energy to our customers and our communities.

With that, I'll turn it over to Brian.

Thanks, Bob, and good morning, everyone. Starting with our financial results, Xcel Energy delivered earnings of $1.24 per share for the third quarter of 2025 compared to earnings of $1.25 per share in the third quarter of 2024. The most significant earnings drivers for the quarter include the following: Regulatory outcomes in electric and natural gas sales growth increased earnings by $0.18 and higher AFUDC increased earnings by $0.08. Offsetting these positive drivers, higher financing costs decreased earnings by $0.15, reflecting the funding of our infrastructure investments and our financial discipline of maintaining a strong balance sheet. Higher depreciation and amortization decreased earnings by $0.09, driven by increased system investments and the higher O&M expenses increased earnings by $0.05.

Turning to sales. Weather normalized and leap year adjusted electric sales increased 2.5% through the third quarter of 2025, driven by strong residential sales growth across all OpCos and increased C&I load in SPS and PSCo. During the third quarter, we also energized Meta's new data center in Minnesota that will continue to scale in the coming years. In turn, for full year 2025, we continue to forecast 3% weather-normalized electric sales growth. In the third quarter, O&M expenses increased $37 million relative to 2024. This increase was largely driven by a $25 million increase in health and benefit costs for the quarter. For full year 2025, we now forecast that O&M expenses will increase 5%.

Shifting to RFP and rate case activity. In Colorado, in partnership with Colorado Energy Office, UCA and commission staff, we issued a near-term procurement for 4,000 megawatts of renewable resources and 500 megawatts of thermal and firm dispatchable resources. This RFP is intended to accelerate the deployment of a portion of our Colorado IRP to capture production tax credits before they sunset. Bids were received this month, and we expect to file a recommendation in December 2025 with the commission decision by February of 2026. In SPS, we issued an all-source RFP to meet an 870-megawatt accredited capacity need. This represents 1,500 to 3,000 megawatts of nameplate capacity that will be online by 2032. Bids are due in January 2026 with an expected portfolio announcement by June 2026. In October, the Wisconsin commission verbally approved NSPW $725 million acquisition of the 375-megawatt Elk Creek solar storage project. Tomorrow, we expect to file a natural gas rate case in Minnesota requesting a $63 million total revenue increase based on a 10.65% ROE and a 52.5% equity ratio. Rates of $51 million will also be requested effective January 1, 2026. Regarding future cases, we expect to file a Colorado Electric and Natural Gas and New Mexico electric rate case later this year.

Moving to data centers. We remain on track to contract the remainder of our original 2 gigawatt base plan by the end of the year. In addition, we have updated our total base plan to include approximately 3 gigawatts of data center capacity. Additional projects included in the base case, we consider high probability and expect of contracted by 2026. This will drive 3% of the 5% assumed annual sales growth in our 2026 to 2030 capital plan. We also continue to make strong progress on the Small coast Creek wildfire claims process. We've resolved 212 of the 254 submitted claims, and we have settled our business 21 of 34 lawsuits. We've updated the low end of our estimated liability to $410 million. We have made significant progress in the third quarter with the resolution of the 3 largest claims by acreage. We have committed $360 million in settlement agreements. So considering the low end estimated liability of $410 million, we're estimating approximately $50 million more on top of the $360 million that has been committed based on our current information. As a reminder, we have approximately $500 million of insurance coverage.

Shifting to our investment plan. Today, we are providing an updated $60 billion 5-year capital expenditure forecast, which reflects annualized rate base growth of approximately 11%. These investments are critical to serving growing electric demand, meet clean energy goals and ensure safety and reliability of our system. We also have an additional pipeline of investments to our $60 billion plan, specifically from our recent RFPs across jurisdictions, incremental data center load and transmission projects from future MISO and SPP tranches. We're excited about our growth opportunities and will continue to finance accretive growth in a balanced manner. This year, we have issued or contracted approximately $3 billion of equity and equity-related content between our ATM program and our 2025 hybrid financing. Our updated '26 through 2030 capital plan reflects an additional $23 billion of debt and $7 billion of equity content. We anticipate that any incremental capital investments would be funded by approximately 40% equity content and 60% debt. We continue to maintain a balanced financing strategy, which includes a mix of debt and equity to fund accretive growth while maintaining a strong balance sheet and credit metrics.

Moving to earnings. We're reaffirming our 2025 ongoing earnings guidance range of $3.75 to $3.85 per share. We're also initiating our 2026 earnings guidance range of $4.04 to $4.16 per share, which reflects approximately a midpoint of 8% growth from the midpoint of our 2025 guidance. Key assumptions are detailed in our earnings release. We are updating our long-term EPS growth objective to 6 to 8-plus percent with expectations to deliver 9% growth on average through 2030. This update reflects our significant investment needs to serve our customers and drive state policies along with confidence in our financial outlook. We are maintaining our dividend growth objective of 4% to 6% with the expectation to be at the low end of the range. Over our '26 to 2030 forecast period, we expect our dividend payout ratio will trend towards the bottom end of our updated payout ratio range of 45% to 55%, which allows greater financial flexibility and dry powder for the future.

With that, I'll wrap up with a quick summary. We continue to lead the clean energy transition, ensuring safe, clean and reliable service and keeping customer bills as low as possible. We announced an updated 5-year capital investment program provides strong, transparent rate base growth and significant customer value. We reached a constructive settlement in the Marshall wildfire and continue to make investments to reduce risk to our system and communities from extreme weather. Our customers have and will continue to enjoy some of the lowest bills in the country with our investment plan. We maintain a strong balance sheet and credit metrics using a balance of debt and equity to fund accretive growth. We reaffirm our 2025 EPS guidance of $3.75 to $3.85 and have initiated 2026 EPS guidance of $4.04 to $4.16, which reflects a midpoint of 8% growth from the midpoint of our 2025 guidance. And finally, we expect to deliver 9% EPS growth on average through 2030. This concludes our prepared remarks.

Operator, we will now take questions.

[Operator Instructions] And our first question is coming from Nicholas Campanella from Barclays.

Just wanted to be clear, '26 at the midpoint, you did about 8%, and I hear you on the 9% through 2030. Does that start beyond '26? Or is that how you're kind of viewing this year?

Nick, I'll take that. No, that includes 2026, so 9% over the next 5 years, inclusive of '26 guidance. So that 9% would be based off the midpoint of this year below $380 million.

Okay. Great. I appreciate that. And then just one other clarification, $7 billion of equity in the plan. I know you talked about $1.3 billion already priced forward. Is that kind of net against that $7 billion? Or is it still $7 billion from here on out?

No. I think of it as we do is kind of $7 billion from here on out with our new '26 to 2030 plan. So if you kind of look at what we did this year relative to last year's plan, which had $4.5 billion in it and kind of take those 2 pieces, we're right online with kind of what we've been messaging around incremental capital that drives about 40% incremental equity content and feel really good about kind of our equity content plans and where we are in terms of manning our credit metrics and executing on the $60 billion investment plan.

Our next question is coming from Steven Fleishman calling from Wolfe Research.

So I guess first on just kind of the profile of the growth rate or growth. When you look at the CapEx plan and the rate base growth, it's very heavily front-end loaded and then CapEx actually falls right now, [ 29 30 ], a decent amount. A lot of the other companies are kind of the opposite, where it's lower now, and it's like ramping up. Could you maybe just kind of talk to that? And is a lot of that just -- we just don't know some of these RFPs and other factors out in [ 29 30 ].

Yes, Steve, I can take that. That one, I think you're exactly right in terms of -- we're always conservative of what we [indiscernible] capital plan and our [indiscernible] portfolio [indiscernible] process in there for the projects that were approved by our Minnesota Commission in Q1 of this year. But it relates to that [ 29 and 30 ], we launched RFPs with Colorado that we're pretty early in the process. And that sits in the kind of our additional pipeline bucket that is as we move through that process kind of into next year and even beyond that we expect there will be opportunities to fill in there, both generation to serve load growth for our customers, but also transmission that we expect to see out of SPP in the near term here. The next tranche of SPP should be a Q4 event that we get visibility in, but then also longer term on MISO Tranche 2.

Okay. And I know just maybe related, the -- at times you've given kind of some rough idea of the range of spending on the upside cases and those different things that you mentioned there. Is there anything you can share on the potential capital and the upside case, things not any near?

Yes. I would say the slide we have in our deck here for today, that's going to be a range of 6,000 to 9,000 total megawatts, we think out of those RFPs plus some transmission. We've always guided people to being competitive in our generation processes and winning about half of that plus that transmission. So I see a $10 billion-plus sitting in that pipeline, not all will be in 2030. Some of those generation processes run through '31, '32, but really good opportunity as we look at the low growth and the transmission needs in our system.

Yes, Steve, I think -- this is Bob. I think you're right in terms of shape. The earnings generally will follow the capital investment plan with some amount of lag in financing costs, and then we look to fill in the back part of our plan with some of the incremental opportunities that Brian had.

Next question will be coming from Jeremy Tonet of JPMorgan. It appears that he has just moved. We'll go to Carly Davenport. Okay, Carly, same thing. We'll go to Julien Dumoulin of Jefferies.

Can you guys hear me?

Yes, sir.

All right. Awesome, guys. Well done. Seriously. Look, if I can, just going back to where you left off with Steve, I'll just see it this way. Of those different points that you raised here, what are the more substantive pieces? I mean it seems like the SPP element could be more substantive that seems more front-loaded a; and then b, the acceleration of some of these renewable procurements get like tax rate expirations could be more substantive and lumpy and don't seem to be in there. But again, you tell me what are the bigger pieces that are not yet in that again, you've laid out a whole bunch of them. I'm just curious which one moves the needle more as that you see it initially.

Julien, I'll start and then Brian can chime in. So a large piece of the SPP, RFP is embedded into our base capital plan. There's a second RFP for SPP capacity and energy that is not included in the plan. And then when I think about Colorado generation, we have really 2 RFPs sitting in front of the commission out there. We have a near-term procurement portfolio that's designed to accelerate and take advantage of renewable credits and that looks like a $4.5 billion -- sorry, 4.5 gigawatt plan. And then there's the just transition solicitation that's been in progress with the commission for a while, which we expect some amount of adjudication later this year or early next, which had somewhere between 4 and 15 gigs of generation needs and it -- there's a bit of overlap between the NTP and the JTS in terms of what's needed in timing. So I wouldn't count those as additive, but there's a big piece of Colorado generation that's likely to come in the '28, '29, '30 time frame that's not included in our base capital plan. And then there's a handful of smaller RFPs in the upper Midwest for generation that are not included in our base plan as well.

Secondly, with regard to transmission, we have ITP and MISO 2.1 embedded in there, although they are longer-dated capital plans and longer-dated in service spends that will result in stuff drifting through this time period and into -- later into the early 2030s. And then there are subsequent ITPs and MISO LRPs that are coming that are not also embedded in this plan. So I think about Colorado Gen being probably the biggest driver of back-end investment in this 5-year plan. And transmission that's not announced out of the SPP, ITP process is sort of the second biggest. Brian, do you got anything to add to that?

Yes. No. I think just absolutely in the Colorado side, we're working through the process, is a really good engaging with our stakeholders to accelerate procurement for these renewable resources given that we have the tax credit cliff in 2030 so we should get visibility into that portfolio in December with a commission decision in Q1. We've got the bids in, robust bid pool working through that. And so that's one of the big drivers. But also as we work through -- as we think about longer term, is incremental data center opportunities and working with our stakeholders in our states in terms of driving economic development and low growth, that can drive longer-term generation and transmission needs, which wouldn't be incorporated, but that's just a longer-term opportunity that I know the industry is seeing.

Excellent. And I don't mean to -- but let me ask you it this way. The 6% to 8% plus versus the 9% that you guys have out there, is the idea that the 9% is sort of at this point in time in the 6% to 8% plus is designed to be for any eventual records with a large -- a lot of large numbers kind of drive some deviation from the 9% that you roll forward a couple of years?

Yes. Julien, we think about it this way is that 6% to 8%. Well, the 6% to 8% is what would you think about a long-term view on EPS growth, when you balance the investment needs of our system, the low growth we're seeing opportunities and also affordability. But when we look at our current 5-year plan and the $60 billion of infrastructure projects for our customers, serving the low growth and the needs of our system, Director communities. That plus really represents the 9% that we see over the next 5 years. if that helps us differentiate in terms of how we're thinking about it.

Next question comes from Carly Davenport of Goldman Sachs.

Maybe just on the load growth outlook, looks like continued strength in SPS, which is great to see. And then a couple of the other opcos shifting a bit lower from the prior plan. So could you just talk a little bit about what's driving those moving pieces on load growth across the regions?

Yes. I think when we look at it, really, SPS continues to be strength in our oil and gas sector. We've seen that for years. this year out in New Mexico. We're going to see teens type of growth at this large C&I sector. And we continue to see that with electrification out of that industry in New Mexico. So strong growth there. Also, FermeAmerica is down in Texas and New Mexico. There's some opportunities there that we've talked about. And so we're seeing that. The other one is more just shifting around potentially in timing of data centers as we think about it when they're coming in. But when you look at our sales growth across all opcos all are in the, call it, 4% -- roughly 4% to 5% with SPS at 8% when we look at it. So we're pretty excited when we see our data center opportunity is really mixed across our service territory, strong opportunities in Minnesota working through some really good opportunities in Colorado and then we talked about some opportunities in Texas and New Mexico.

The one other thing is -- thing I'd like to say is that 5% sales growth that we talked about, having the diversification is not all data centers. Only 3% of that 5% is data centers. So we also have 1.5% of that 5% is driven by the SPS oil and gas electrification, then we just have customer growth, residential customer growth. We're starting to see some electrification on the residential side. So that's about 0.5%. So really kind of diversified growth, which I think is important as we look forward.

Great. That's really clear. And then maybe just a follow-up on kind of the financing and the balance sheet. Seems like you're targeting kind of now 16% to 17% FFO to debt targets. I guess can you just talk about sort of comfort level there with the cushion versus downgrade threshold levels? And how confident you are in the past to kind of squarely getting back to that 17% level on a longer-term basis?

Yes, Carly. The way I think about it is, no, we have not changed our long-term view on our credit metrics in that 17% level. That has not changed. It's -- it's important to maintain a strong balance sheet and healthy credit metrics. Just when you look at our spending over the next few years, we kind of grow into that 17%. And so it's really just we designed our equity plan and our equity content plan to get back to that 17% in the latter part of this forecast, which -- that is our long-term view. So that has not fundamentally changed from a credit perspective, maintaining our balance sheet, protecting our metrics. Just when you have this type of elevated CapEx over the next few years, there is some pressure there.

Next question will be coming from Jeremy Tonet of JPMorgan.

I just want to step into equipment availability a little bit more, if I could, such as transformers, transmission, 2 CGPs and components there. Just wondering if you could frame for us how long the queues are there? And I guess, how you see aligning that with new data center in tracer contracts?

Yes. Great question, very timely and very strategic. I said in my prepared remarks, I'm really proud of the team here at Xcel Energy. I think we have the best team working on this. We have been very, very progressive in terms of securing the assets that we need to build the infrastructure that sits in front of us. You're absolutely right. Lead times have elongated, and I'll let Brian comment on any a components. But we think that given our scale, our scope and our approach to our major vendors, that we have access to inventory and supplies maybe that others don't have. We've taken a very progressive shift in how we work with our vendors, making sure that they see our entirety of our capital plan, they can plan for the work that they do with us. We find out who's best able to serve us both on the services side as well as the equipment side, and we backward integrate them into our capital plan in a way that is both we protect ourselves from pricing side as well as we get certainty of equipment and certainty of labor in a pretty tight market. That's been the strategic focus for the team for a year or 2 as we saw the market start to tighten, particularly with data center build. And maybe I'll let Brian just comment on what we're seeing in turbines and transformers and things like that.

Yes. I mean, I think it's absolutely no secret in terms of where the turbine market is, call it, 4 years out. As I Bob, mentioned though, we've gotten ahead of it in terms of having those 19 turbines on order and that's one of the benefits of scale is we can order a significant amount of equipment knowing that we will use it somewhere in our system and being able to deploy it throughout our system with the low growth we're seeing. Main power transformer is another one that's taken -- that's these large-scale transformer 345 kV your outsource a few years. So it's really how do you get ahead of it and make sure that you have the right supplier relationships, working through all the potential tariffs and supply chain challenges that currently exist there. But we feel really good about where we are.

And also, I think about that also within the context of our safe harbor strategy. In terms of having all the equipment for both our base plan and then the incremental projects that coming out of our incremental plan and ensuring that not only are the safe harbor, but compliant. So we feel really good about our overall place from a supply chain perspective. That's on the equipment side. There's also a labor side of it, too, from an EPC perspective and ensuring that we have top tier EPC firms lined up, not only for this year or next year, but for our 5-year plan and beyond and having those key partnerships is really, really important. I think, differentiated as we go to market here in terms of executing on our plan.

Got it. Very thoughtful process there. And I was just wondering if you might be able to align that a little bit more with the demand growth. It seems like the data center pipeline, as you described in the slides, stepped up quite nicely versus before. And just wondering what you see on the type of discussions and the speed to market world and how this all fits together.

Yes. Well, obviously, very strategic and timely as we watch our industry work very progressively to bring speed to power here and making sure that we energized this very critical national asset in terms of artificial intelligence and data center development. not surprising. We've got great interest and our pipeline continues to build, and we continue to move stuff from highly probable into the contracted categories. We have some of the most affordable energy in the country, as I mentioned in my prepared remarks, we have an incredibly good strong development team. We're working through either ESAs or large load tariffs in all of our states and making sure that we protect our existing customers from the addition of new large loads, and we've laid out in the past, our principles around this in terms of cost causation and whose funding and if we trigger a transmission investment, new generation investments, making sure that we protect our customers along the way, and there's a net benefit for the entire of the system when you bring out some of these new large loans. I think that -- it should also be noted that I mentioned sort of strategic geographic advantage.

In addition to low energy bills, we have enormous high clean energy content in our systems already. That's a very attractive component to these data center developers as well as their end-use customers. So I think that between our sustainability portfolio and where we're trending as a company across all of our states and making sure that we can deliver a cleaner energy product as well as a highly reliable and highly affordable product is very strategic as we approach economic development with data center developers.

Next question will be coming from Anthony Crowdell of Mizuho.

I just have, I guess, 2 super quick cleanups. I think to Steve's question, I think you mentioned about $10 billion of incremental CapEx. That is an addition or would be on top of current 9% EPS growth. Is that accurate?

That is accurate.

Great. And then this one, and I probably should wait for EEI, but just the time is right. you're currently talking 9% growth, but you've kept the guidance at 6% to 8% plus. Just curious on why not readjusting the 6% messaging that shows all the potential upside that you have? Like it doesn't even seem likely that you hit 6% or even 7% like I'm just curious on the thought process of keeping it 6% to 8% plus.

Yes. Anthony, look, we balance a lot of perspectives as we think through this in terms of what is the right long term. And when I say long term, 6% to 8% is beyond the 5 years about balancing affordability and anything else that goes into that. And so we thought the plus as a way to message that we do have a lot of infrastructure needs on behalf of our customers here in the next 5 years. But longer term, we need our role beyond 2030, we'll continue to evaluate that. And then just quick on your first question, we said $10 billion plus, but some of that could fall outside of this 5-year when you think about some of the generation procurement in some of the -- particularly the MISO transmission will be longer dated. But really excited about our overall 5-year opportunity and beyond that. .

Next question will be coming from Sophie Karp calling from KeyBanc.

Congrats on the strong, I guess, guidance revision guys. A couple of questions for me. So maybe if you could talk a little bit about the trends in SPS. I know you continue to flag the electrification of Permian as one of the drivers of the volume growth there. With the oil prices have been kind of where they are, is there any reason to be concerned about that trend at all at this point?

Sophie, it's Bob. I think the growth you see in the Permian is probably a function of 2 things. One is continued strength in mining in the Permian Basin. So just more wells, more infrastructure, more fields being open. The second is the trend towards electrification of those fields in an existing field. So I think there's 2 big drivers out there. When I talk to our largest customers down in the Permian and the Delaware Basins, this continues to be their lowest cost resource around the globe. And so I think even when you start to see oil and gas prices fluctuate, I think these properties in the Southwest are still varying the money for them, and they'll continue to see mining and mining growth down in the Southwest. So I don't have a lot of concern about that. load growth profile. And then as we talked about the data centers, that low growth profile, we feel very confident in and see opportunity to add to it.

Got it. That's pretty clear. And then on the renewables versus gas, right? You guys are clearly stepping into more accelerating renewables to harvested tax credits. At the same time, a lot of your peers are actually going northwards gas and they're flagging that they need -- we will need to build more gas to firm up the system for [indiscernible] demand. So I guess my question is, will we see this same trend play out in your service territories at some point? Or is it just the renewables are so attractive that you feel good by, I guess, still going full speed and renewables as opposed to more dispatchable generation?

Yes. A couple of themes in there for sure. One, as I said in my prepared remarks, we sit in one of the most geographically attractive areas for both wind and solar assets. And so we see real customer benefits from continuing down a trend of investing and taking advantage of those natural resources, particularly while tax credits help make them affordable for our customers. But you also see us adding -- we've got 4.5 gigs of natural gas capability coming into the plan in the next 5 years. as well as, I think, probably north of 5 gigs of energy storage as well. So we are affirming the system backing the wind and the solar with attractively priced backup energy and making sure that we are both reliable, affordable and sustainable for our customers to sort of the holy trinity of our business.

Next question will be coming from Steven D’Ambrisi from RBC Capital Markets.

I just had a quick one. Just had a quick one. I appreciate the color on the 9% because one of the things, I guess, I was scratching my head out and I was hoping to get a little color on was clearly [ 29 ] rate base moves up something in the order of 20-plus percent. And so if you run the midpoint of your EPS guidance out, now at 9% versus where you were previously in the plan. It implies a pretty significant compression in earned ROEs, hard earned ROEs. Now obviously, you're spending a lot more capital and spending it quicker. So that kind of makes sense to me, but you do have pretty good mechanisms. So can you talk about any embedded conservatism that's in the plan around assumed earned ROEs that you would get given the significant increase in rate base?

Steve, yes, I can answer that question for you. And I think that's really why I want to provide some color with 11% rate base growth that we expect 9% rate base growth or 9% earnings growth over the next 5 years to really highlight that we don't expect significant compression in ROEs by any means. And we actually -- if you think we've talked about some of the rate cases that we have come up in terms of driving some ROE improvement because we've delayed some rate cases for some reasons. And so when I think about it, it's really -- we've always talked about when you get to this kind of high growth, we're at 11% rate base growth, significant CapEx comes with financing needs that you would see about a 200 basis points delta between [indiscernible] profit and your earnings growth over a 5-year period. And so I think we wanted to just highlight that, that it's as we move through the next few years, our financing is lined up with kind of our CapEx spend we're working through some regulatory proceedings over the next couple of years, you start to catch up on that rate base versus EPS growth. But over the 5-year period, we feel really good about where we are that the long-term EPS growth, coupled with our financing plan and maintaining a strong balance sheet is we feel good about that and don't see ROE compression at all. We certainly have conservative ROEs in our plan, but we don't see ROE compression as we sit here today and look at where we are today.

Next question will be coming from Travis Miller coming from Morningstar.

Questions around the transmission spend. Obviously, this has been a big thing for you for many years. But wonder as you ramp that up and think about these large customers, how easy or difficult is it to identify specific customers who might pay for some of this transmission spend, i.e. we see contracts between generation and data centers. Can you think some of this transmission spend essentially off of residential commercial customer bills and identify specific customers pay for it?

Yes. Great question. First, thanks for recognizing leadership and transmission. I'd like to say that we have been the leading builder of new transmission line miles over the last 15 years when you come from the state of hockey, you got to skate to where the puck is. And we feel like we've built a grid in an infrastructure system that is enabling us to energize data class. When I think about incremental people willing to spend incremental money on transmission, I think our first principle with regard to hooking at data centers is if they require a new transmission line, particularly a lateral, usually they're paying for that 100%, and we put that into sort of a kayak bucket as opposed to net rate base spend, and it's going to be attributable directly to that customer. And when you talk about can you identify those customers. Those customers are knocking our door freely and willingly to spend the money, particularly on the transmission interconnection make sure that they can get service as quickly as possible. So this is really a management of the inbound as opposed to us having to go find people that are willing to do it. I think that's a pretty common approach that the data center developers and the hyperscalers are willing and able to do. we're protecting our customers from the transmission build. And then when you think about the net benefit, if you're taking the entirety of our system cost and adding more megawatts to it. That's a net benefit on a per kilowatt hour rate on the transmission system in totality and a benefit for all customers.

Okay. Okay. So not all of that transmission spend then is -- would go on commercial and residential?

So that the transmission spend that we highlighted in our plan is regional, super regional. We have stuff with connecting MISO and SPP markets. We have big regional transmission coming out of the long-range transmission planning of the MISO process that is regionally allocated, not necessarily coming directly on to our customers. Same with our SPP build out, a lot of that is regional cost allocated not coming into the -- directly 100% into retail rates.

Okay. Great. And then how much is you talked about that lateral, just to follow-up on that. scale or kind of share of how much that specific lateral type of demand you're getting relative to like what you just talked about the regional type of trying to...

Yes. Travis, those are really customer-specific system impact studies to just wherever that customer is locating on the transmission system, the size of that customer, the ramp of that customer. And so those are really specific hard to put a number on it in a general sense.

Next question will be coming from Alex Canyon coming from BTIG.

Maybe just a question on the regulatory side. Obviously, it's great to see all this CapEx and also the transmission as well, but I'm just kind of thinking about also your comments about relative share of wallet and rates, but I'm just wondering kind of the nature of communications that you're having with regulators just on kind of expectations for where rate trends may be going over the next 5 years within this within this window, maybe just kind of the balance between revenue requirements and volume growth or whatnot, but I'm just kind of curious about what the reception is to those types of conversations.

Yes. Great. I think it's really fundamental and foundational for our team here to make sure that we keep our bills for our product as affordable as possible for our customers. So we wake up every day thinking about that. We have to balance that with other desires, reliability, sustainability, resiliency and safety across our system to make sure that we can meet those needs of our customers as well. I mean you don't have to look any further than Jamaica or Cuba to realize the devastating effect that communities have when our system and our product isn't available. So we are spending time and energy, as you say, with our regulators, with our legislators, making sure that we recognize all of the things that we're bringing to the system and that while affordability is a hugely important piece. We think -- we start from a very good spot. We think we've been a very good steward of our customers' money over the last decade. We'll continue to be very prudent, very focused on making sure that we can deliver the system that they need and want with the policy objectives that they need and want at a price that is as affordable as possible. So we work through that with each state and each class of customer and making sure that we keep our product very affordable and attractive. .

As we have no further questions. For closing remarks, I'll turn the call back over to CFO, Brian Van Abel for closing remarks. Thank you.

Thank you all for participating in our earnings call this morning. Please contact our Investor Relations team for any follow-up questions.

Thank you very much, sir. Ladies and gentlemen, that concludes today's conference. We wish you a very good day. You may now disconnect. Have a good day.

Hello, and welcome to Xcel Energy's Second Quarter 2025 Earnings Conference Call. My name is George, and I'll be a coordinator for today's event. Please note, this conference is being recorded. [Operator Instructions] I'd like to hand the call over to your hosts today Mr. Roopesh Aggarwal, Vice President, Investor Relations, speak at today's conference. Please go ahead, sir.

Thank you, George. Good morning, and welcome to Xcel Energy's Second Quarter 2025 Earnings Call. Joining me today are Bob Frenzel, Chairman, President and Chief Executive Officer; and Brian Van Abel, Executive Vice President and Chief Financial Officer.

In addition, we have other members of the management team in the room to answer your questions if needed. This morning, we will review our second quarter 2025 results and highlights, provide updated 2025 assumptions and share recent business and regulatory updates. Slides that accompany today's call are available on our website.

Some comments during today's call may contain forward-looking information. Significant factors that could cause results to differ from those anticipated are described in our earnings release and SEC filings. Today, we will discuss certain metrics that are non-GAAP measures. Information on the comparable GAAP measures and reconciliations are included in our earnings release.

I will now turn the call over to Bob.

Thank you, Roopesh, and good morning, everybody. In the second quarter of 2025, Xcel Energy continued to demonstrate our commitment to our customers, investors and communities to make energy work better. During the quarter, we delivered strong earnings of $0.75 per share. We invested $2.6 billion in resilient and reliable energy infrastructure for our customers navigated and evolving energy policy landscape to ensure that we can continue to provide safe, clean, reliable and affordable electric and natural gas service. We continued our wildfire risk reduction efforts to enable safer and more resilient communities.

Based on our results through the first half of the year, we remain confident in our ability to deliver on our earnings guidance for the 21st year in a row, one of the best track records in our industry. At Xcel Energy, we believe that we're in the early stages of an infrastructure investment cycle in the United States that will define many industries for decades.

Not just the often discussed AI boom, we see potential investment in onshoring and reshoring of manufacturing and other energy-intensive industries. And given our competitive reliability, cost and sustainability, we believe we will be attractive to those industries. And of course, we see strong investment in oil and gas and other energy infrastructure, particularly in our SPS region, where we power large portions of the Permian and Delaware basins. We continue to see strong energy demand from electrification of transportation, manufacturing and of home heating.

Xcel Energy is here to meet the moment for our customers. We set our capital plan, our 5-year capital plan last fall, we outlined a $45 billion infrastructure investment forecast to serve increased energy demand and make needed investments to strengthen our transmission and distribution systems. At that time, we also expected that our customers' needs could exceed that base forecast.

Today, we now believe that we're likely to need an additional $15 billion of capital investment to meet our customer needs, largely within our current 5-year forecast and some beyond. There are several drivers to that incremental need. In June, we filed a generation plan to support energy needs in our fast-growing Texas and New Mexico region.

Our recommended portfolio included nearly 5,200 megawatts of generation storage to be placed in service by 2030. Over 4,500 megawatts is expected to be company-owned and operated. This includes 1,300 megawatts of wind solar, 2,100 megawatts of natural gas CTs and 500 megawatts of storage. We anticipate filing for regulatory approval of these projects over the remainder of this year with commission decisions in 2026.

We also anticipate issuing a second RFP later this year for additional resource needs in that region. In the Upper Midwest, we received approval in Minnesota for 2 firm dispatchment projects totaling 720 megawatts and at least an additional 2,800 megawatts of company-owned wind that will use our new Minnesota Energy Connection transmission line when it's placed in service in 2029.

RFPs for additional generation projects that are needed to meet customer demand and grid reliability are ongoing, and we expect commission decisions in 2026. We expect to invest an incremental $3 billion to $4 billion in regional transmission projects to support reliability and regional growth, including two 765 kV lines, one from the MISO tranche 2.1 and the other from the Southwest Power Pool ITP portfolio.

In addition to this $15 billion of incremental need, we are actively working through the resource planning process in Colorado that likely requires between 5 and 14 gigawatts of new generation to meet reliability and customer demand through 2031. We are still working through required regulatory approvals for a number of these projects, and we'll provide updates as they materialize. We expect to formally update our 5-year forecast through 2030 on our third quarter earnings update.

As we move to aggressively build the generation and transmission that the grid requires to support both growth and reliability needs, we're also navigating a rapidly evolving energy policy landscape. While we predominantly navigate resource plans and transition initiatives at a state level, we're also very focused on federal legislation as it pertains to how tax credits and permitting can impact customer outcomes.

On July 4, the budget reconciliation bill was signed into law. While we saw some challenges to wind and solar tax credits, there are also positive outcomes for customers in the bill. Lower corporate tax rates result in lower energy bills, all else being equal. Accelerated depreciation of capital is beneficial to customers as is the efficiency of transferability of eligible credits, both of which were continued in the one Big Beautiful Bill.

As with the incentives for qualifying energy storage and for carbon-free dispatcher resources like advanced geothermal, nuclear generation, and carbon sequestration, all beneficial for customers in the country's energy future. Not surprisingly, renewable tax credits were front and center on the debate around this legislation. Accordingly, we expected limitations to credits as Congress tried to narrow a significant budget gap.

For several years now, we've been working with our state commissions and other stakeholders on the substantial generation required in our operating regions to meet the reliability and growth needs of our customers. In total, we estimate that we need between 15 and 29 gigawatts of new generation before 2031, which a significant amount could be sourced from wind and solar.

Accordingly, we've already invested substantial capital and/or physically commenced construction of the clean energy resources included in our base capital plan as well as enough to execute on our incremental investment pipeline, which we believe are necessary to meet the data center and electrification needs of our customers. We'll continue to monitor and manage through the recent executive orders, agency, rule makings and trade and tariff actions and make adjustments as needed as we continue to develop the energy assets that we need in our regions.

In addition, we've procured 19 gas turbine reservations to meet the reliability needs of our customers. We serve customers in the most resource-rich regions of the country and pairing wind and solar and energy storage and gas backup means that we can deliver clean reliable and affordable energy for our customers at the speed that they require.

Xcel Energy also continues to make progress to mitigate risk from wildfires and extreme weather. This includes investments in advanced camera and weather station technologies, enhanced power line safety setting installations, pole inspections and replacements and operational measures such as wildfire safety operations and public safety power shutoffs.

We've also seen strong support from our commissions and states to invest in wildfire risk reduction. In June, the Colorado PUC approved our unanimous settlement for our $1.9 billion wildfire mitigation plan, which included a partial securitization mechanism to manage customer bill impacts, and an extension of our excess liability insurance deferral.

And in July, the Texas Commission approved our $500 million system resiliency plan. Both investment plans enhance the reliability and resiliency systems to mitigate the impacts of evolving and volatile weather patterns. And on the legislative front in both Texas and North Dakota, constructive wildfire legislation was signed into law.

And North Dakota legislation path establishing that one of utilities in compliance with an improved wildfire mitigation plan, it has exercised a reasonable standard of care. In Texas, similar legislation passes states and electric utilities not liable for damages from a wildfire, provided it's not negligent and is in compliance with an approved wildfire mitigation plan.

Finally, I want to take a moment to thank our incredible line worker crews and other employees who have been working in tough conditions this week to get the lights back on for our customers after two rounds of major storms in the Upper Midwest. All told, about 200,000 customers experienced outages from storms Sunday and Monday nights, mainly in Minnesota, Wisconsin and South Dakota.

More than 2,000 crew members joined in the effort, including crews from our Colorado and our Texas service areas as well as contractors and mutual aid partners. Their dedication to serving our customers when things get challenging is what they're known for, and I am very proud of everything they've accomplished in the past few days.

With that, let me turn it over to Brian.

Thanks, Bob. Good morning, everyone. Starting with our financial results. Xcel Energy delivered earnings of $0.75 per share for the second quarter of 2025 compared to earnings of $0.54 per share in the second quarter of 2024. Most significant earnings drivers for the quarter included the following: higher revenue from electric and natural gas service reflecting rate case outcomes and sales growth, increased earnings by $0.24 per share and higher AFUDC increased earnings by $0.07 per share.

Offsetting these positive drivers, higher interest charges decreased earnings by $0.04, reflecting higher debt levels and interest rates. Higher depreciation and amortization decreased earnings by $0.03, driven by increased system investment and increased O&M decreased earnings by $0.02 per share.

Turning to sales. Weather-normalized electric sales increased 3.5% for the second quarter, driven by strong sales growth across segments in SPS and Pisco. For the full year, we continue to forecast 3% weather-normalized growth. Shifting to rate case activity. In South Dakota, we filed an electric rate case requesting a $44 million increase based on a 10.3% ROE and a 52.9% equity ratio.

Looking forward, we are evaluating options to file an electric rate case in New Mexico, natural gas rate case in Minnesota and rate cases in Colorado later this year.

Moving to data centers. We are making solid progress on our target pipeline or in active negotiations on several ESAs. We remain on track to meet our goal of contracting our toll base plan by the end of this year, as we have spoken about before. We also continue to make strong progress on the Smokehouse Creek wildfire claims process. We've resolved 187 of the 253 submitted claims, which we continue to view as constructive. In addition, we have settled or dismissed 11 of 27 lawsuits. We have committed to $176 million in settlement agreements, of which $123 million has been paid through the second quarter of 2025.

Based on current information and the settlement activity, we are reaffirming the low end of our estimated liability of $290 million, which remains well below our insurance coverage of approximately $500 million as we described in our earnings disclosure. Regarding the Marshal trial, we are preparing for trial starting September 25 and expect it to conclude by mid- to late November. Please see our earnings release and slides for additional disclosure on Marshall and Smokehouse Creek.

Moving to guidance. We are reaffirming our 2025 guidance range of $3.75 to $3.85 per share. We remain confident in our ability to deliver long-term earnings growth in the upper half of our 6% to 8% target range. Updates to key assumptions are included in our slides and earnings release.

With that, I'll wrap up with a quick summary. Xcel Energy posted strong second quarter 2025 earnings of $0.75 per share. We continue to lead the clean energy transition, while ensuring safe, clean and reliable service and keeping customer bills as low as possible. We now have visibility to $15-plus billion of opportunity in our investment pipeline. We continue to make investments to reduce risk to our system and communities from extreme weather, alongside constructive support from our states.

We maintain a strong balance sheet and credit metrics using a balance of debt and equity to fund accretive growth -- and finally, we reaffirm our 2025 EPS guidance of $3.75 to $3.85. We remain confident in our ability to deliver long-term earnings growth in the upper half of our 6% to 8% target range. This concludes our prepared remarks.

Operator, we will now take questions.

[Operator Instructions] Our first question today is coming from Carly Davenport of Goldman Sachs.

Maybe to start on the line of sight to the CapEx upside moving from that $8 billion up to $15 billion. I guess how should we be thinking about the potential conversion of that upside into the base capital plan next quarter? Is there a spend that could fall outside from a timing perspective or any regulatory considerations that could keep dollars out of the base plan update. Just any color there would be helpful.

Carly, yes, I'll try and keep this somewhat succinct. But when we think about it -- the SPS RFP were relatively early in that process. We'll be filing with the New Mexico and Texas commissions here in August and expect decisions of those certificates of need are in the first half of next year. Minnesota, we continue to work through the RFPs and then we have the transmission -- the big transmission in SPP and MISO.

A lot of that will be in the kind of '26 to 2030 time frame with a little bit falling out -- but as I think about it, we're generally conservative with what we view from a regulatory perspective. So we'll be really clear and transparent on Q3 in terms of what's in our base plan. and what's outside of it.

But overall, I think we feel really good about this. What we now change the $15 billion plus line of sight in terms of the progress we've made both in Minnesota and in SPS. And I think we have one of the best growth prospects in the industry, and we'll be really clear on how we lay that out in Q3.

Just to add on to what Brian said, I agree with everything. Look, these projects are largely generation and transmission related in the incremental need category. And while a lot of it is driven by reliability needs of the existing footprint, some of it's driven by growth as well.

And we know as a company, as an industry, there's tremendous need for electricity in this country right now to meet growing demand from all the things I mentioned in my prepared remarks. And so we think that this incremental need is real. It's going to materialize and whether it's in the front 5 or 6 or 7, it's definitely coming towards our territories to support reliability and to support growth.

Yes. And I think about above the Colorado resource plan that we're working through right now and expect a commission decision here in that spend, the commercial operations for those projects is through 2031. So that's both going to be in this 5-year and kind of that incremental CapEx for longer. .

Great. I appreciate all that color, super helpful. And then maybe just on the SPS resource plan, as you pointed to that in your previous answer. Just could you remind us on your turbine procurement position just as we think about executing on the gas generation included in that plan, if I recall, when you initially filed it, it was supposed to come into service by kind of the 2030 time frame. So could you just lay out the details on that front?

Sure. Happy to, Carly. In the prepared remarks, I said that we had 19 turbine reservation slots to support either projects that we already know are coming or we will need them for. I think the SPS portfolio requires 9 of those 19. And so I think we're largely ready to supply those on time.

Yes. And Carly, this is something that we think about our overall scale and relationships with our OEMs and the need for gas generation we see across our footprint. We look at -- we reserve turbine slots in kind of that '27-'28 time frame well ahead of the market so we could deliver on these projects because we see a significant need of gas generation across all of our operating companies to integrate the renewables and ensure reliability. So we're well positioned from that perspective, not only on the EPC side, but also on the OEM side, but also on the EPC side given the demand on EPCs and the construction of the gas units across the country.

Next question will be coming from Nicholas Campanella from Barclays.

I just wanted to -- I wanted to kind of hit OBB, but more specifically, I guess, the treasury order that's coming in the next few weeks here. It seems like your appetite for renewable build-out is unchanged now that we're on the other side of this.

But just if the window for safe harbor is shortened, just how do you kind of see that affecting your plan? And I know that you did a lot of safe harbor on the original 45. So I just wanted to kind of confirm that you don't really see an impact on any outcome, but I'll let you talk.

Nick, yes, kind of a lot wrapped up in that question. So if I don't hit on all of it. Just remind me the pieces that you want me hit on. I think stepping back, we're -- when we look at our $45 billion base plan, we've taken steps, as you'd expect us to start physical construction on a number of projects last year, started physical construction on projects this year in the first half. So we feel very good about our $45 billion base plan plus a $15 billion-plus line of sight projects that we have.

So we feel good at delivering those projects for our customers and having them in a good place from a start-up construction or physical work perspective. So overall, in a good place. And I think about the treasury guidance from our perspective, the statutory language is beginning to construction, and that term has been defined for a long time.

But we've been engaged in D.C. along with our industry partners, and I think we do expect something to come out here by mid-August, not going to opine on what that might be. But as we look at it, we're continuing to start physical work on the projects and we value that guidance as it comes up. But overall, we feel really well positioned with where we are today and the generation needs to serve our customers.

Okay. And then just with the $15 billion of CapEx upside becoming more of a reality now, just that should boost pressure higher on rate base growth. Your cash flow profile is already improving from the investments you're making today? And then you kind of talked about the depreciation benefits of OBBBand we could have sales growth later in the plan as well.

So just as we kind of think about getting further out in the plan. How should EPS growth kind of track against rate base growth? Should we be kind of expecting similar types of equity issuance? Or is that kind of improving in your view?

If I think about it, I'll take that in a couple of different ways, again, really excited about the growth prospects and delivering for our customers here as we see the demand growth increase. From an equity perspective, no, we've always been managing a strong balance sheet.

We do a balanced mix of debt and equity. If you look at our earnings release in our Q, we issued over $1 billion of equity via ATM in Q2. And so that really our base plan had $4.5 billion of equity, and we already accomplished $2.5 billion between before late last year and this ATM issuance. So we're in a really good place, and we'll continue to do that.

We do see the incremental capital as we always said, coming with a balanced mix of debt and equity and roughly rule of thumb we've always given is that 40% equity and we view that ATM is our plan to be, but we'll also look at other products, mandatory converts as our equity needs to grow to fund our accretive growth.

As I think about that translating from rate base growth to EPS growth, obviously, we'll provide a holistic update in Q3 around our new 5-year capital plan, our incremental pipeline, our sales growth, rate base growth -- and even what we said last year when we moved to 6 , we talked about being above the high end at times, and I think that's a good way to think about it.

Okay. Very fair. And just 1 last 1 on Marshall. I know that trial in September, I think mediation deadline was today, but just is settlement of that fully off the table for now? Or is there still an opportunity to do that into trial and just taking your temperature there?

Nick, it's Bob. Thanks for the question. Look, so technically, the core order mediation concluded at the end of July, but that doesn't mean the parties don't continue to talk. As we step back and think about the trial broadly in the fire broadly, we continue to maintain that our equipment didn't start the second condition in the wildfire and we're prepared to go to court, as Brian indicated in his prepared remarks at the end of September, and that trial is likely to last through middle to late November.

Between now and then, you're probably going to see some filings back and forth from plaintiffs and us around pre-child briefs and things like that. But we're planning to go to trial. We're always open to settlement discussions, but we have to start with the idea that our equipment didn't cause that second condition, and we maintain that.

Next question will be coming from Jeremy Tonet of JPMorgan.

I was just wondering if you could turn to the competitive transmission opportunities. How do you think about incorporating them into your plan? Do you probability weight the chance of winning contracts here? Or do you include them kind of on a binary basis.

Jeremy, I can speak broadly about it. We don't include them in our capital plan unless they're on, and we're very disciplined on the competitive side. You don't see us bidding on projects generally outside of our service territories. So pretty disciplined. I mean we look at all of our growth capital that we have within our service territories, the transmission we need to build in SPP, MISO longer term Colorado and all the generation. You don't expect us to be chasing competitively bid transmission projects kind of outside of our service areas.

Got it. Understood. And I just want to, I guess, turn to the data centers a little bit more. What is your contracting progress on the base data center assumption here. And can you provide any more color on the counterparty type, long-term ramp for the portion of your base forecast currently contracted?

Jerry, let me start. This is Bob, and then I'll kick it over to Brian. As a company, we're very excited about the opportunity to serve this type of critical infrastructure. We have about 1.1 gigawatts of data centers under construction and under contract. And our plan is for by the balance of the year to hit another sort of gig of data centers ultimately hitting about 2.5% by 2030 time frame.

And then we've got a really robust pipeline behind that high-quality stuff that we're working on right now of gigs that I would talk about is maybe Tier 2 opportunities, and then there's even Tier 3 and beyond stuff beyond that total. So really excited as I sit and think about our business, we have interest in all parts of our 3 operating areas, the upper Midwest, Colorado and the Desert Southwest and for different reasons.

Each of those regions are very attractive to our data center counterparts, either whether you're a hyperscaler or a data center developer. With specific contract stuff, I'll kick it over to Brian tell the ramp profile. But big picture, I think we see this as a real growth opportunity, a real opportunity to grow sales on our system, bring rates down for all of our customers and be beneficial for both hyperscalers as well as our existing customer base.

Yes. And just to add a little bit of color. We talked about -- we continue to make really good progress in the assay negotiations with those counterparties -- we talked about 1 in Minnesota, 1 in Wisconsin, 1 in Colorado. A couple of them are your -- what you expect your hyperscalers, and we continue to make progress. And that's when I think about progress, they have their system impact studies, facility studies, land and now we're on to actually the terms of the agreement and discussing that. We also had a new opportunity in Texas and Amarillo that we're working on.

But again, we don't expect us to update our data center slide every quarter. Our pipeline is robust, as Bob mentioned, we continue to see inbounds and looking forward to executing on the agreements we talk about for the balance of the year and bring that forward.

Got it. Very helpful there. And just a quick last one, if I could. If you could speak a bit more on the gain on debt repurchases there. And was this contemplated or the plan or any other color there?

Yes, Jeremy. No, it wasn't part of our plan. What we saw is we use it opportunistic. It's a great tool. When you think about we saw some headwinds in our venture capital investments related to clean energy. And you know this is a challenging market for clean energy.

And so you saw some negative mark-to-markets this year in the first half, and we just used that to that -- to offset that. So not an earnings driver at all.

Next question will be coming from Julien Smith of Jefferies.

Bob, let me ask you this. I mean, you say at times, we can do the math. But if I heard you right earlier in the call, I mean, it seems like you might actually be doing the math for us here, at least as it pertains to the third quarter update, I mean, are you guys actually going to refresh the full suite of guidance in a more affordable way with that roll forward?

Yes. So I think, as always, our third quarter update has a full and comprehensive update on all of the assumptions, whether it's sales or capital deployment, rate base growth, earnings growth, financing needs, et cetera, and we plan to do a full roll forward on the third quarter call. .

And then just going back to the -- your ROEs in the PSCo backdrop. Obviously, you got the distribution rider, et cetera. How do you think about the improvement in earned returns there just a little bit again, that might be one of the disintermediate factors between rate base and earnings here, at least one of the bigger factors in the medium term. How are you feeling about that prospects, et cetera, just given the.

Yes. Julien, I can take that one. Yes, you're talking a rolling 12-month average -- the distribution rider has been a good mechanism. We have a lot of investments on the distribution systems that deliver for our customers, both from a resiliency perspective and a growing capacity perspective. So -- and that rider this year had -- was capped.

So it's kind of partially implemented this year than full implementation next year. That 7.8 perspective we do expect improvement through balance of the year and then continued improvement next year. And so we are working on that and the distribution rate once fully implemented, should help address some of that next year.

Yes. I also think Brian mentioned in his prepared remarks, we were looking at potential cases in Colorado at the end of the year. And that's a composite ROE. And so we've done a lot of work to improve the electric side of that ROE and the gas still has lag in some of its mechanisms. If you think about the preponderance of the capital in that company going forward, it's largely electric.

And as Brian mentioned, whether it's a distribution rider, a renewable energy rider, a transmission rider or a new rate case, we expect -- certainly, the electric side of that ROE to continue to improve.

Got it. Excellent. And sorry, I'm going to press it too much on this. But given what you have here already, and I know we can do the math, but just to verify. I mean it does seem like a low teens rate base CAGR, which admittedly -- would it be all that different from your, should we say, regional peers necessarily. Curious if you want to verify that.

Julien, we did kind of give you that rule of thumb of 25 bps of rate base or 25 bps of rate base equals roughly incremental $1 billion of capital. So yes, you're doing the math correctly. No, we do -- we'll roll forward off a higher base for 2026 to 2030 rate base guidance as we always do. But you are correct, and we believe we have 1 the best growth prospects in the industry, and we're going to deliver these projects for our customers, right? We're really focused on reliable in affordable and clean energy for our customers. And so we have a lot of investments ahead of us to deliver on that.

So next question is coming from Steve Fleishman, Wolfe Research. I think we lost our operator.

Well, that might be me. I thought I lost the call. So just a follow-up on the question regarding the kind of OBB and executive orders. How -- do we need to be concerned at all about kind of federal land issue with respect to your kind of renewable projects.

Steve, I can take that one. We don't have any projects on federal land, just make it easy -- an easy answer.

Okay. I like easy answers. And then on the -- going back to the -- also the topic of the Marshal fire, Bob, you mentioned the -- you kind of don't think you caused a second ignition. I think your slides also continue to show that a lot of the damage was already kind of happening from the first ignition. I assume that remains part of your core case as well.

Yes, absolutely, Steve. So when I think about the trial broadly, I think the share report identifies that the start of the fire was on property owned by the 12 tribes. That first ignition was subject to almost 100-mile an hour winds for over an hour and 20 minutes causing a fire spread theory where we see propagation of that fire into the towns in Colorado.

And then obviously, at some point, there's a purported second condition. And so we believe that, again, on a on a trial basis, we have to have been found to have started a second edition that we were negligent in the maintenance and operations of our lines -- and then we get into sort of joint several -- or not joined several liability on the call. It's sort of a proportion damages based on causality. So again, we feel very good about the facts and circumstances of our trial and are prepared to go there.

Okay. And and then there is still an opportunity to kind of settle if you deem that it makes sense.

Sure. There's no prevention from a settlement proposal. We've got probably 2 months before the trial begins. And you could settle even during the pendency of the trial. So there's lots of opportunity there. But again, we feel very good about our facts, and we're prepared to go the trial. .

We'll now move to Sophie Karp of KeyBanc.

I have a follow-up on the trial. Could you remind us if there was any sort of range of estimate on the damages? I know that ultimately that will be decided at the second trial, but what are the estimates that are currently being uncompleted?

Sophie, it's Bob. I think you got it right. The structure of the trial is such that we look at liability in the first trial and in the second trial would be any damages if we get that far. We don't have an aggregate estimate of damage claims. What we do believe is that from the insurance companies, there was about $2 billion worth of property damage that they paid off in their claim process.

Got it. Got it. And then my second question is just kind of broadly speaking, you have a lot of growth opportunities ahead of you, right? Then you're going to presumably have some equity needs for those -- and given that your valuation does not reflect those growth opportunities right now in my opinion at least, have you explored are you likely to explore alternatives to equity rates, such as maybe selling of some of the noncore assets or assets you deem less core to your electric operation? And how should we think about that?

Sofia, I can take that. I commented a little bit more in terms of ATM is our plan to be, but we'll look at that mandatory and converts. We have a strong balance sheet, and we're comfortable issuing equity to fund that accretive growth. Now I've been on record. We've been on record that we're not all that interested in minority interest sales. And if we think about -- we view our assets is core. And if we were ever to do anything, it would be for strategic reasons not to fund our investments that we need to make, and we've been disciplined for the past 20 years on the strategic side.

We'll now move to Paul Patterson of Gradrock Associates.

So next question is Paul Patterson with Gradrock Associates. Right now, we do not have any further questions. I'll turn the call over to Mr. Brian Van Abel for any additional closing remarks.

Thank you all for participating in our earnings call this morning. Please contact our Investor Relations team with any follow-up questions. .

Thank you, sir. Ladies and gentlemen, that will conclude today's conference. You have disconnect. Have a good day and goodbye.