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| Statement |
|---|
| Our core utility operations are strong and demonstrate significant earnings growth of over 35% in 2023 when compared to 2022 |
| We really had a great year, our 2023 earnings at Avista Utilities show significant improvement from 2022 and reflect the benefits of improved cost recovery resulting from our general rate cases, as well as our success in managing our costs through the headwinds of increased interest rates and the impact of higher power supply costs are improved |
| Our improved earnings demonstrate the team's commitment to delivering results |
| Assuming a constructive outcome in our 2024, Washington, general rate case filings, we expect our earnings to grow over the long term in the range of 4% to 6% from a 2025 base year |
| Our improved cost recovery in 2023 is partially the result of deferral mechanisms, we've been successful in developing with our commissions such as, wildfire and insurance costs |
| AEL&P had a strong year as well their results met the high end of our expectations for the year |
| Just as with the gas outage, I'm proud of the resilience of our customers and our operational decisions as we navigated these issues |
| As Dennis mentioned, this increase into this two utilities is largely the result of improved cost recovery, successful cost management and lower net power supply costs |
| So whether it's improving the carbon profile of our natural gas operations, or assisting our customers with electrification initiatives we're building on our foundation of clean hydropower to work towards an even cleaner energy future for our region |
| I'm thankful for each one and for the resilience and understanding of our customers |
| That's good news |
| We're thankful for the safety of all involved, as well as the regular regulatory support from our commissions |
| Our people along with mutual aid workers from eight utilities spanning eight states and contract employees work safely to restore service to every impacted customer in less than one week that we were able to achieve 100% restoration in such a short timeframe is a testament to the determination and drive of our people and the people who came alongside of us to help |
| Improved cash from operations will help fund the remainder |
| The Board has a long-standing commitment to maximize shareholder value and we strive to targeted competitive dividend for our shareholders |
| I'd like to start by saying how proud I am of what we accomplished in 2023 |
| You can see recent examples of that demonstrate our long-standing commitment, to doing the right thing for our environment, our people, our customers and communities along with our shareholders |
| We continue to make progress on our clean energy goals on the natural gas front with the four renewable natural gas supply contracts we've executed so far, we expect to purchase $9.7 million therms of natural gas annually from renewable sources |
| We are committed to providing affordable and reliable energy to our customers, and we make customer-focused investments in our infrastructure to improve reliability and maintain the safety of our operations |
| We continue to focus upon additional regulatory mechanisms that improved cost recovery |
| And we think that if we're able to move forward with this change it would position us |
| Our capital expenditures at Avista Utilities were $485 million in 2023 so that we can continue to support customer growth and maintain our system to provide safe, reliable energy to our customers |
| That's more of a near-term opportunity |
| Great |
| Great |
| Great |
| Great |
| And at the same time, we believe we have the opportunity to optimize our resources on a go-forward basis |
| We've executed meaningful steps in our strategy at Avista Utilities that show in our results |
| And we are getting timely recovery of that investment |
| Statement |
|---|
| Our consolidated results came in below our expectations |
| At the same time, two operational issues impacted our system and the natural gas system throughout the Pacific Northwest, mechanical issues at both a third-party transmission pipeline and the natural gas storage facility we partially own reduced the capacity of natural gas in the region |
| We lost some of our infrastructure out there |
| These challenges combined with the extreme cold resulted in very high commodity prices |
| This was the result of losses in our other businesses, driven by the periodic valuation of our investments |
| Nearly 37,000 natural gas customers were impacted when a gas pipeline that transports gas to Avista system was damaged by a third party dig-in |
| In November, we faced the largest natural gas outage in our company's history |
| With regard to both of those our facilities were in were impacted by the fire on the West Plains and Medical Lake area |
| We expect the impact of the ERM on earnings to be negative during the first quarter of 2024 |
| The – I don't have the exact numbers off the top of my head here but obviously, with the ERM that was negative for a power supply cost, it was negative to the tune of $0.09, if we had a 955 [ph] mechanism in place it would have shrunk that significantly |
| Our guidance for Avista Utilities in 2024 reflects unrecovered structural costs, which we estimate reduced the return on equity by 70 basis points |
| And then maybe just one on kind of how are you thinking about on? I know you said, weather's been challenging from an earnings perspective so far in Q1 and you in your guidance you expect that to kind of balance out on the ended -- or towards the end of the year |
| Although, much of the winter season has been milder than normal, we experienced very cold temperatures in mid-January |
| Various factors could cause actual results to differ materially from the expectations we discuss in today's call, please refer to our 10-K for 2023, which is available on our website for a full discussion of these risk factors |
| And then, with the other fire that's there was north of the Spokane area of that happened and originated well away from all of our facilities |
| We had to spend a little bit of money fixing all the stuff that was lost out and on the West Plains there, but that was definitely manageable |
| I mean with regard to the wildfire, I think you're referring to the fire in North of the Spokane area and then there was one West of town |
| Is that had a negative impact on your bottom-line? Dennis Vermillion Yeah |
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