Nextera Energy Inc Q3 FY2025 Earnings Call

Good day, and welcome to NextEra Energy, Inc. Q3 2025 Earnings Conference Call. Please note this event is being recorded. I would now like to turn the conference over to Mark Eidelman, Director of Investor Relations. Please go ahead.

Thanks, Mark, and good morning, everyone. NextEra Energy delivered strong third quarter results with adjusted earnings per share increasing 9.7% year-over-year. In addition, through the first 9 months of the year, our adjusted earnings per share has increased 9.3% year-over-year. The continued strong financial and operational performance at both FPL and Energy Resources positions our company well to meet its overall objectives for the year. America is in a golden age of power demand. The country needs more electricity than ever. New electrons can't get on the grid fast enough. NextEra Energy is uniquely positioned to help lead this pivotal moment for our sector. We develop, build and operate all forms of energy infrastructure. At our core, we're a development company. We have a world-class platform that enables us to quickly build low-cost generation and electric and gas transmission. We're not just recontracting around existing assets, we're also building new energy infrastructure needed to power America. Our 2 world-class companies, Florida Power & Light Company and NextEra Energy Resources are the perfect complement to one another. Day in and day out, we are powering today and building tomorrow. Importantly, we are in a terrific position to continue delivering near-term and long-term value to our customers and shareholders. As we discussed with you earlier this month, our long-term earnings growth drivers are extensive, both inside and outside Florida. Simply put, we have many ways to grow across our platform, both this decade and the next. We are excited to discuss this in much more detail with you at our investor conference on December 8. The Florida economy continues to see significant growth, and Florida Power & Light Company continues to make smart long-term investments to serve that growth, while keeping bills low and reliability high. We put our customers first and the results speak for themselves. FPL customers experienced top decile reliability that's nearly 60% better than the national average. And typical FPL residential bills are 20% lower than they were 20 years ago when adjusted for inflation. And that's not by accident. FPL's nonfuel O&M costs are 70% lower than the national average and over 50% lower than second best in our industry. And approximately 90% of FPL's power generation comes from the nation's largest gas-fired fleet and 4 nuclear units. This baseload power is the backbone of our system, giving us the flexibility to meet our customers' needs with the lowest cost forms of energy right now, solar and storage. Remember, a robust gas and nuclear fleet means we don't necessarily need nighttime electrons. We need more low-cost electrons to meet our daytime peak, which is why solar and storage are the perfect complement and choice for FPL's system and customers today. FPL is also preparing for the future, which will require even more baseload gas generation and perhaps further down the road, nuclear generation. And it's all happening in a state that needs more electricity, not less, just like America. Florida is one of the nation's fastest-growing states and the world's 16th largest economy. It's why FPL plans to invest approximately $40 billion over the next 4 years in new all-the-above energy infrastructure, including 5.3 gigawatts in solar, 3.4 gigawatts in battery storage and a gas peaker plant that is pending regulatory approvals. We look forward to continuing the successful multi-decade approach of adding low-cost generation to meet Florida's growing need for power, while also increasing reliability and keeping customer bills low. This approach is at the heart of our new 4-year rate proposal. As a reminder, on February 28, we initiated FPL's 2025 base rate proceeding for new rates effective in January 2026. We reached a proposed settlement agreement in August with most of the intervenors in the proceeding, reflecting a broad set of constituents across our customer base. The 4-year proposed agreement would provide an allowed midpoint regulatory return on equity of 10.95% with a range of 9.95% to 11.95%. There would be no change to FPL's equity ratio of 59.6%. The proposed agreement also includes a rate stabilization mechanism similar to what we filed in February. The proposed settlement also includes 2 new large load tariffs that are designed to ensure large load customers pay for the incremental generation needed to serve them. We believe the proposed settlement is fair, balanced and constructive and supports our continued ability to provide highly reliable, low-cost service for our customers through the end of the decade. If the proposed agreement is approved, typical residential customer bills would increase only about 2% annually between 2025 and 2029. This means bills would remain well below the current national average, providing our customers with the economic certainty that comes from a 4-year rate agreement. We completed evidentiary hearings earlier this month and expect the Florida Public Service Commission to provide a final decision on the proposed settlement agreement on November 20. This summer, we received a constructive outcome on federal tax credits, providing policy certainty for our renewables build at Energy Resources. We expect to receive tax credits for our renewable development plans through 2030, while our suppliers are positioned to be FEOC compliant. We've also been able to reduce development risk for a large part of our planned build. That's because Energy Resources has approximately 1.5 times coverage of the project inventory required to support its development expectations through 2030. This provides us the runway we need to continue delivering low-cost power solutions to our customers, who need power today and tomorrow. Renewables are just the start. We also plan on delivering power through battery storage, gas-fired generation and nuclear. Over the second and third quarters alone, we have originated 2.8 gigawatts of new battery storage opportunities, as we continue to grow the world's leading storage business backed by a domestic supply base with batteries made in America. We're also leading the much-needed development of linear transmission infrastructure, both electric and gas, and our customer supply business has proven integral to serving data center customers. We're tying it all together through our AI-driven world-class development platform and decades of experience. And we are doing it at a time when the combination of development capabilities and a strong balance sheet are more important than ever. It's why we are ideally positioned to work with hyperscalers, who are increasingly looking to power their business by bringing their own generation. We are unique in that we combine a national footprint, a strong balance sheet, supply chain capabilities and experience in building all forms of generation and transmission, together with unmatched customer relationships and an industry-leading team on a development platform second to none, and that's what we believe it takes to serve this new customer class, which is investing tens of billions of dollars per project. Hyperscalers, data center operators and load serving entities continue to tell us they need solutions for large load today and tomorrow to address growing energy demand across America. As a leader in serving this demand, I am pleased to announce that we have entered into a 25-year power purchase agreement with Google that, pending regulatory approvals, enables us to recommission our Duane Arnold Energy Center nuclear plant in Palo, Iowa, just outside of Cedar Rapids. The 615 megawatt plant is just the beginning and will help power Google's growing cloud and AI infrastructure in Iowa once it returns to operation, which we expect to occur no later than the first quarter of 2029 and perhaps as early as the fourth quarter of 2028. Duane Arnold shut down in August 2020 after safely and reliably serving Eastern Iowa for decades. And because we carefully and methodically went through the decommissioning process, we have confidence in the investment required to restart it. During our evaluation of recommissioning Duane Arnold, we collaborated closely with the plant's minority owners, Central Iowa Power Cooperative, known as CIPCO, which provides power to the local community, and Corn Belt Power Cooperative. As part of that collaboration, CIPCO will purchase 50 megawatts of the plant's output on terms and conditions consistent with the Google PPA, and we have signed definitive agreements to acquire CIPCO and Corn Belt's combined 30% interest in the plant, which will bring our ownership to 100%. Restarting Duane Arnold marks an important milestone for NextEra Energy. Our partnership with Google not only brings nuclear energy back to Iowa, it also accelerates the development of next-generation nuclear technology. With the support of the Trump administration, Google and NextEra Energy are creating more than 1,600 jobs and adding more than $9 billion to the local economy, creating a win for the U.S., a win for both companies and a win for Iowa. As a demonstration of the pride of working at Duane Arnold and for NextEra Energy, a significant number of Duane Arnold's previous workforce are looking to return to work at the facility. And our team working to recommission Duane Arnold includes many of the same employees who decommissioned the plant 5 years ago. Beyond the nuclear plant, we have ample land available to provide additional power and capacity solutions, including battery storage to support data center builds and potential future expansion. As part of the agreement, NextEra Energy and Google have also signed an agreement to explore the development of advanced nuclear generation to be deployed in the U.S., which will help power America's growing electricity needs. Of course, to move that forward, we'll be certain to appropriately mitigate and limit our financial exposure as new nuclear technologies continue to advance. We expect Duane Arnold will be eligible for a nuclear production tax credit with a 10% energy community bonus. And once restarted, we expect Duane Arnold to contribute up to $0.16 of annual adjusted EPS on average over its first 10 years of operation. Duane Arnold is one example of data center hubs we are developing across the country. When you put it all together, our opportunity set is not contained to a single utility service territory. NextEra Energy has a national footprint. We serve America and have relationships with all types of customers, including cooperatives, municipalities and utilities of all sizes looking to attract data center load to their service territories. We are committing to building new infrastructure and building energy for our customers where and when they want it. And I believe there is no team and no company in this country with a comprehensive set of skills and a balance sheet better positioned to get the job done. Bottom line, we have many ways to grow, and we remain well positioned not just for the rest of the decade, but into the next decade as well. We look forward to sharing many more details with you in December.

Thank you, John, and good morning, everyone. For the third quarter of 2025, FPL's earnings per share increased by $0.08 year-over-year. The principal driver of this performance was FPL's regulatory capital employed growth of approximately 8% year-over-year. FPL's capital expenditures were approximately $2.5 billion for the quarter, and we expect FPL's full-year capital investments to be between $9.3 billion and $9.8 billion. For the 12 months ending September 2025, FPL's reported return on equity for regulatory purposes will be approximately 11.7%. During the third quarter, we reversed approximately $218 million of reserve amortization, leaving FPL with a balance of roughly $473 million. Looking forward, we expect to use a portion of the remaining reserve amortization balance for the remainder of the year. FPL's third quarter retail sales decreased 1.8% from the prior year comparable period due to milder weather. On a weather-normalized basis from the prior year comparable period, retail sales increased by 1.9% due to an increase in customer growth and underlying usage. Now let's turn to Energy Resources, which reported adjusted earnings growth of approximately 13% year-over-year. At Energy Resources, adjusted earnings per share increased by $0.06 year-over-year. Contributions from new investments increased $0.09 per share, primarily driven by continued growth in our renewables portfolio. Contributions from our existing clean energy portfolio remained unchanged year-over-year despite weaker wind resources due to better performance at our nuclear fleet. Wind resource for the third quarter of 2025 was approximately 90% of the long-term average versus 93% in the third quarter of 2024. The comparative contribution from our customer supply business increased by $0.06 per share, primarily driven by timing of origination activity during the quarter. All other impacts decreased by $0.09 per share, driven by asset recycling during the third quarter last year as well as higher financing costs, mostly related to borrowing costs to support our new investments. Energy Resources had a strong quarter of new renewables and storage origination, adding 3 gigawatts to the backlog. With these additions, our backlog now totals nearly 30 gigawatts after taking into account more than 1.7 gigawatts of new projects placed into service since our last earnings call. We expect the backlog additions will go into service over the next few years and into 2029. This marks the sixth consecutive quarter that Energy Resources has added 3 or more gigawatts to its backlog. We continue to see strong customer demand for ready now capacity solutions as we had our strongest quarter ever in battery storage origination with 1.9 gigawatts of additions to our backlog. Turning now to our third quarter 2025 consolidated results. Adjusted earnings per share from Corporate and Other decreased by $0.04 per share year-over-year. Our long-term financial expectations remain unchanged. We will be disappointed if we're not able to deliver financial results at or near the top end of our adjusted earnings per share expectation ranges in 2025, 2026 and 2027. From 2023 to 2027, we continue to expect that our average annual growth in operating cash flow will be at or above our adjusted earnings per share compound annual growth rate range. And we also continue to expect to grow our dividends per share at roughly 10% per year through at least 2026 off a 2024 base. As always, our expectations assume our caveats. This concludes our prepared remarks. And with that, we will open the line for questions.

The first question comes from Steve Fleishman with Wolfe Research.

Congrats on the Duane Arnold news. Maybe just on that topic, John, can you give us any sense on what the cost of restart might be and also the buy-in price of the 30% that you're buying in of Duane Arnold?

Yes. Thanks, Steve. Appreciate the question. So first of all, just the sensitivities, we're not going to go into the CapEx number on this call. But needless to say, we feel very good about our ability to recommission Duane very efficiently. The plant is in great shape. As I said before, the team that will be doing the recommissioning is the same team that did the decommissioning. I've been out there recently to tour the facility. It's in good shape. So we'll provide more details on that as we move forward. On your second question on the 30% buyout of CIPCO and Corn Belt, it's really pretty straightforward. I mean that buyout was done in exchange for us assuming their decommissioning liability. It's pretty much that straightforward. And from our standpoint, we have more than ample decommissioning funds that had already been set aside. So I think it's attractive for us. I think it's attractive for CIPCO and Corn Belt as well; it’s a win-win for all parties involved.

Okay. I have another question on a different topic. It was great to see another 3 gigawatt quarter added, but I noticed there was a gigawatt removed from the backlog. Could you speak about the reasons behind that 1 gigawatt removal?

Yes, absolutely, Steve. This is pretty straightforward. So as you said, we added 3 gigawatts. I mean, another really strong quarter of origination, and we are just seeing a lot of demand for renewables and storage in the market. And remember, so out of that 3 gigawatts, we put 1.7 gigawatts into service in the quarter. And really, I think what you're referencing is the 900 megawatts. Let me just break that down. So we removed 650 megawatts from backlog, which was pretty conservative by us. I think you know we're pretty conservative in how we manage the backlog. We did that for various development reasons. And this is really on some smaller projects that we are continuing to manage, as we move forward. I think we're going to get it all back in '26 and '27 on that 650 megawatts. So it will just come a little bit later. And then there was another 250 megawatts that we just had a little bit of a permitting delay on. So we're just shifting that from '25 to '26. And when you put that 900 megawatts together, it’s what, call it, 130 of the backlog, but feel good about getting all of that back. It just comes a little bit later in time. Otherwise, had you included that, we would have been at the bottom end of the '24, '25 range. And I think as investors saw, we've reaffirmed our expectations through '27, including the fact we'd be disappointed not to be at the high end of the range. And so these moves really just don't have any impact on our ability to meet our financial expectations that we've communicated to investors. And as you look out, a lot of positives to see in the backlog. I mean '28 and beyond are shaping up unbelievably well. We just got a great head start on those years. So overall, we're in really, really good shape where we sit now. And I have no concerns about where the backlog sits, and it's as strong as it's ever been.

The next question comes from the line of Shar Pourreza with Wells Fargo.

John, I know you mentioned to Steve that you didn't want to discuss the actual CapEx numbers for Duane Arnold, but I would like to ask about the qualitative aspects of the plant. There's a target of $1.6 billion for a Pennsylvania plant that is currently under budget. You mentioned that this current plant is in good shape. Can you provide some insights on what you're observing with that plant and how we should interpret it without delving into the numbers?

Yes. Thanks, Shar. Welcome back, by the way. Good to have you back.

Thanks for having me back.

It's great to hear from you. I'll avoid discussing the numbers for now, but we've invested significant effort into Duane Arnold, conducting thorough diligence. Having the same team that managed the decommissioning now leading the recommissioning is a major advantage, as they are fully aware of what was previously done. Our plan is well-defined, and we are confident in what needs to be accomplished. The facility is in excellent condition. When I visited, it felt like we just locked the door and are now reopening it. There are certainly tasks to complete in order to bring the plant back online, but overall, the plant is in good shape, and we are optimistic about our ability to move forward successfully.

Fantastic. And then, John, just one last one is just, I guess, given the lack of additional nuclear sites to kind of repower for you guys, do you see kind of the next wave of deals moving to CCGTs for energy resources? Are you seeing demand there, especially given the partnership you have with GE?

Thank you, Shar. We have numerous growth opportunities, which we discussed last month, and I will elaborate on those shortly. One significant avenue for growth is through new gas-fired technology. NextEra has built more gas-fired generation in this country over the past 20 years than any other company, giving us extensive experience in this area. Our established development platform makes it easy for us to re-enter this sector, leveraging our resources in land acquisition, permitting, and supply chain capabilities. Our partnership with GE Vernova enhances our strong customer relationships and supports our development efforts, allowing us to shift our focus to gas generation seamlessly. Currently, we have approximately a 20-gigawatt pipeline already developed due to the efficiency embedded in our development platform. We are enthusiastic about the opportunities we see in combined cycle technology. Additionally, a unique advantage we have, which we will discuss in December, is the integration of renewables and storage. When data centers are eager to begin operations quickly and secure a load interconnection by bringing their own generation, we can meet that need with our available solar and storage solutions, with gas generation following. This positions us uniquely to support the expansion of data centers, which we refer to as data center hubs, potentially accompanied by gas or even small modular reactor technology as part of our national collaboration with Google. There is much to look forward to.

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

I just wanted to ask going back on nuclear. There's a lot of momentum right now for AP1000. And just curious what your appetite would be in participating in something like that? Or if in terms of new nuclear, should we be solely kind of focused on SMR and restarts of current large-scale plants?

Yes. Currently, we are focusing on Duane Arnold, Point Beach, and Seabrook as we optimize those facilities. We're excited that we have approximately 6 gigawatts of SMR capacity across these three sites, in addition to our development platform. As a nationwide development company, we are also exploring greenfield sites, ensuring we have existing generation ready to support the phases of a data center build-out while we wait for gas-fired generation or SMR technology to become available. We are making significant progress on SMRs and will provide more details in December. I'll reiterate our approach to SMRs: we will be very disciplined in our capital allocation strategy, ensuring we have the right commercial and financial structure to minimize any financial risk as we invest in these facilities. When looking at NextEra, our position is quite unique because major hyperscalers are investing tens of billions of dollars, which is different from the competitive landscape of four or five years ago with many smaller developers. Large-scale developers like NextEra, with a strong balance sheet and proven track record, are in a better position to meet the needs of these hyperscalers. We have the capacity to develop across various generation types, including renewables, storage, gas, and nuclear, and can offer solutions like transmission infrastructure or gas pipeline lateral for gas build-outs. Our capabilities and the strength of our team, customer relationships, and ability to collaborate with utilities, cooperatives, and municipalities set us apart from most others in the field. As we assess the market, the recent DOE letter to FERC emphasizing the importance of developing your own generation strongly aligns with our strengths and advantages. The future looks promising.

That's great. I really appreciate that. Good points. And I know that you've been doing this 6% to 8% outlook for a long time. You've basically been beating that every year. And you look at some other premium companies out there now doing 7% to 9%. What's your philosophy and how you're thinking about long-term growth? And is that a consideration at all, as we are thinking about what could be out there on the Analyst Day?

All great questions, and we'll address those on December 8.

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

Congratulations, team. It's great to hear from you. I wanted to follow up on a couple of things. First, regarding the gas and contracted gas strategy, can you share what your expectations are or the success you've experienced so far? I understand this might touch on the December update, but could you provide any details on the latest progress? Should we anticipate more announcements similar to what we saw with Google, and how will those relate back to contracted gas? Also, is there a schedule you can share as you consider the ramp-up of this initiative? I realize it’s early in the longer-term timeline extending to 2030 and beyond, but how would you describe the current opportunity?

Yes, we have a lot of different initiatives underway. I mentioned our data center hub strategy, which we will delve into further in December. A significant part of this involves expanding our combined cycle units. We see a lot of attractive opportunities with the hyperscalers in our target market. Our existing renewable portfolio positions us well to secure early-stage load interconnects as we integrate gas later on. Our capability to blend gas with renewables and storage or SMR technology, along with the infrastructure needed for transmission and gas pipelines, aligns with our strengths and supply chain capabilities. As for our plans, we are eager to share more details in December. Overall, I feel optimistic about our competitive position today, especially considering that few companies can establish the trust and confidence necessary, as evidenced by our successful partnership with Google and our prospects with other hyperscalers. More updates will follow.

Excellent. I appreciate it. And then related here, just to elaborate a little bit further on that net originations discussion here. Can you elaborate a little bit? I mean, obviously, there's been some media attention around Esmeralda and Jackalope, for instance. Can you speak a little bit how that fits in? Were they in your backlog or the position? I mean, just trying to juxtapose the broader media conversation, which isn't particularly articulate about this versus what we're seeing in the quarterly update.

Yes, absolutely. Esmeralda is simply a development project that was not part of our backlog. It's a future project planned for BLM land. The BLM made it clear they were not looking to permit it as a single large project but would consider applications for individual projects. However, we have a substantial pipeline, making this just one component of it. We have not invested any money in Esmeralda; it's a project we could develop eventually. So, there is really nothing significant to note there. Regarding Jackalope, we will extend the timeline a bit more as we continue to work with the customer. We'll see what unfolds, but it remains a small project within our extensive backlog. Importantly, we have 1.5 times coverage on our inventory, so I am not concerned at all. We can easily draw from other projects in our pipeline to meet customer needs moving forward, placing us in a very favorable position.

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

Maybe just another quick follow-up on the backlog. A lot of the additions this quarter coming beyond the 2027 time frame. So just as we think about that potential pull forward in demand related to the tax credits rolling off that you all have referred to, is that strictly a 2028 plus opportunity? Or is there any opportunity to see that impact '26, '27 as well?

Yes. I believe the increase in demand will accelerate as we approach 2030. We continue to see improvements in our position for 2026 and 2027, and we are optimistic about our prospects for filling the 2027 needs. Our financial plan for those years looks solid. However, my primary focus is on 2028, 2029, and 2030, where we anticipate significant opportunities. Historical trends indicate a natural pull forward in customer demand, not just in 2028 but also in 2029 and 2030. We are well-positioned around FEOC and our safe harbor strategy, which gives us unique competitive advantages that we will discuss in detail in December. Given the pipeline developing around 30 gigs, I feel confident about our current standing.

Great. And then maybe just back on Duane Arnold. The $0.16 of average accretion that you mentioned in the first 10 years of the PPA, is there any color that you can provide on the cadence or if there's significant variability year-to-year that we should be thinking about?

There is not significant variability from year to year. The reason we mentioned this is that there are refueling outages for nuclear, and during refueling years, the impact is not that substantial, but there can be some fluctuations related to those outages. That's why we used that language.

Next question comes from Bill Appicelli with UBS.

I want to follow up on Carly's question regarding the pull forward. Can you discuss the development capabilities? You've been averaging about 3 gigs a quarter at the low end. What is the potential for that in terms of capability and supply chain?

We are well positioned with our supply chain, especially regarding batteries and our plans for purchasing other necessary parts and equipment. This includes transformers and electric switchgear, which I believe will provide us with a competitive advantage. Our strong balance sheet and world-class supply chain capabilities set us up uniquely for the opportunities that will arise in the coming years. We can achieve things that others may not be able to, and I am confident in our ability to capture market share, as we have historically done well in pull-forward scenarios. Additionally, we are expanding our focus beyond traditional origination to incorporate renewables and storage solutions for large load customers, creating incremental opportunities that we haven't pursued before. We are actively preparing for the demand pull forward and believe we are positioned to take full advantage of the opportunities it will bring.

Great. Shifting gears to FPL and the significant load growth, how is the valuation progressing? You've mentioned around 3 gigawatts of initial sites or capability. I know you'll provide more details in December, but is there any information regarding the tariff structure or the efforts and discussions related to attracting these customers?

All right. Thank you. So we've got a couple of tariffs that are up for approval at the commission that we are going to hear about on November 20. Regardless of that, we've had folks that have been pinging us all year on availability of getting onto our system, when can they get on to our system and so on. So we are no different at Florida Power & Light than many of the utilities that you guys follow around the nation. These hyperscalers and these data center operators are looking to figure out where they can plug in and how quickly they can plug in. I think what John and Mike Dunne have mentioned before is that this is a potential opportunity at FPL later this decade. And I think for now, that's right. That could certainly change. But we are spending a lot of time doing engineering studies for everyone that you could imagine. And we hope that the environment here in Florida is one that the hyperscalers and data center operators will come to embrace. I mean, why not? We've got a great system at a low cost. So we feel really good about it.

The next question comes from the line of David Arcaro with Morgan Stanley.

I was wondering if you could talk about how renewables are interacting with data centers, especially over the next couple of years for projects that you've been working on. I was curious if there's any percentage of power needs that you find are typically covered by renewables when you're powering data centers? Are you seeing any colocation opportunities? And how does battery storage get involved? So curious if you could give kind of a sense of the typical relationship or design that you're seeing there.

Yes, David, data centers are eager to begin their projects right away. They aim to develop the initial phases of their campuses, which can be quite large, potentially spanning from 1,000 to 5,000 acres. Each 1,000 acres represents about a gigawatt of capacity. As they consider permits and construction, their primary focus is on obtaining load interconnect. In many regions, securing a load interconnect requires them to provide their own generation. What sets us apart in the renewable space is our ability to help them navigate the early stages by identifying suitable sites and adequate generation solutions to achieve load interconnect, whether that's through renewables or a mix of renewables and battery storage. We have experienced success in various locations. We also have the capability to collaborate with grid alliances to upgrade systems and unlock additional megawatts needed for the initial load interconnect. This is crucial, as load interconnect is necessary to draw power from the grid for the first phases of development. Many load-serving entities require self-provided generation to facilitate this process, and we can meet that need with renewables, storage, and grid alliances. The plan is to subsequently support them with baseload generation. By offering a comprehensive solution tailored for hyperscalers, we become the trusted partner they seek, allowing us to grow alongside them as they expand their facilities.

Got it. Makes sense. That's helpful. And I was wondering if you could talk about what you're seeing in terms of project returns, the trajectory there? And is there a case for higher returns too as we go forward through the end of the year?

Yes, that's a great question. And I said this a month ago, returns have been higher than I've ever seen them in this industry. And I think that's due in part to the unique competitive advantage that we have, and it's exciting for us because as I think about all the opportunities that we have, not only this decade but into the next, recontracting is a big piece of that. And so we have a lot of existing generation that rolls off a contract by the end of the decade that we're going to be able to recontract into the market at much higher premiums. But look, it's just supply and demand. It's that simple. There's a lot of demand out there, and there's just not as much supply to match it. And so that's commanding premiums in the market and high and attractive returns. And that's why it's great to be in a position where we have a really strong pipeline and a really strong supply chain position. And I think we're going to be uniquely positioned going forward to be able to capitalize on what is going to become just a growing market demand, particularly as we get to the end of this decade and into the next.

The next question comes from the line of Nick Amicucci with Evercore ISI.

Just wanted to touch upon kind of the evolution that we just kind of left upon. So as we kind of think about over the balance of this decade into the next, how should we be thinking about the kind of the portfolio, the kind of culmination of that and kind of if we think about it by energy and generation source? Obviously, we saw storage kind of tick up here from a backlog perspective. Just interested in kind of hearing your thoughts around it.

Yes. As I consider the next decade, Florida Power & Light has always been a key part of our strategy. It benefits from being located in the fastest-growing state in the U.S., which is also the 16th largest economy in the world. The strong growth driven by the influx of new residents to Florida is not expected to slow down. In terms of our regulated businesses, it's important to note that our strategy extends beyond just the base load provided by Florida Power. We now have large load tariffs that we've never had before, which includes electric transmission that is in high demand nationally. Our NextEra Energy Transmission division leads the way in competitive transmission, presenting many capital expenditure and growth opportunities as we move forward. Additionally, gas transmission offers great potential, not only from the existing pipeline assets but also from promising long-haul projects that we'll be discussing, especially to support large-scale developments. This significantly expands our regulated business compared to historical levels. Furthermore, we have numerous growth avenues in the Energy Resources side, particularly in renewables, which are poised for even greater strength as we approach the end of the decade and beyond. Storage is another key focus for us; the current market is short on capacity, and storage solutions are economically advantageous, flexible, and can be deployed quickly compared to gas-fired peakers which take several years to build. We are leaders in energy storage with a unique advantage in our domestic battery supply agreements that minimize risk. In addition, our recent agreement surrounding Duane Arnold and our work on advanced nuclear projects nationwide, such as Point Beach and Seabrook, along with potential new nuclear developments, position us well. We also have considerable expertise in gas-fired generation, drawing on our two decades of leadership in this area and a 20-gigawatt pipeline of development projects. When you combine all these capabilities, particularly in serving large load customers, our unique position becomes evident. This is because successfully securing load interconnections requires retail energy capabilities, which our customer supply business provides. It is crucial to be able to undertake various tasks to enable large load transactions, supported by a solid balance sheet and a capable team. Our extensive 50-state presence enhances our ability to execute, which is particularly valuable given our 20-year track record. Looking ahead, we have significant recontracting opportunities as our lengthy power position becomes available at the end of this decade. Moreover, our initiatives in artificial intelligence aim to drive efficiencies, reduce costs, and create new revenue opportunities. Overall, when you consider all these elements, we are well-positioned as we move beyond 2030.

Perfect. Yes, that makes a ton of sense. And then just one last quick one for me, too. As we kind of think about now, obviously, just the topic du jour with Duane Arnold and the potential restart. How are you guys seeing the nuclear fuel supply chain kind of shape up, as we kind of think about it going forward, just knowing that Russia is going to be coming offline from an enriched uranium capacity in 2028?

Yes. I mean I think the U.S. government is very focused on that. The industry is very focused on that. And we've been very disciplined in terms of how we secure our long-term fuel going forward. So I feel good about where we stand. We baked into our numbers that we gave you on Google our position around where nuclear fuel sits today.

This concludes our question-and-answer session. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. Thank you.