Good morning, ladies and gentlemen. Thank you for standing by and welcome to the NICE Source First Quarter 2025 Earnings Conference Call. Please note that all lines have been placed on you to prevent any background noise. After today's presentation, there will be an opportunity to ask questions. To ask questions, you may press star followed by the number one on your telephone keypad. If you would like to raise our questions, please press star followed by the number one again. I will now turn the conference over to Dave Brown Communications. Please go ahead.

Good morning, and welcome to the NISOR's First Quarter 2025 Investor Call. Joining me today are President and Chief Executive Officer Lloyd Yates, Executive Vice President and Chief Financial Officer Sean Anderson, Executive Vice President of Technology, Customer, and Chief Commercial Officer Michael Lewers, and Executive Vice President and Group President Nysource Utilities, Melody Birmingham. Today, we will review Nysource's financial performance for the first quarter and provide an update on operations and growth drivers. We'll open the call to your questions following prepared remarks. Slides for today's call are available in the Investor Relations section of our website. Some statements made during this presentation will be forward-looking. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the statements. Information concerning such risks and uncertainties is included in the risk factors and MD&A sections of our periodic SEC filings. Additionally, some statements made on this call relate to non-GAAP earnings measures. Please refer to the supplemental slides, segment information, and full financial schedules for information on the most directly comparable GAAP measure and a reconciliation of these measures. Now, I'll turn the call over to Lloyd.

Thank you, Dave, and good morning, everyone. I'll begin on slide three. The NISORS strategy is simple. We are committed to delivering safe, reliable, and affordable energy to our customers. We execute this strategy through efficient deployment of capital, safe asset operations, and constructive regulatory mechanisms. These are converted into a reasonable return on invested capital, enhancements to our balance sheet position, and offer a dependable and growing dividends. These are the foundation of the NYSORCE business plan, which continues to offer compelling value to stakeholders, driven by regulated utility operations across premium jurisdictions with diversification across geography and fuel type and disciplined capital allocation. Advancing to slide four, we will step through our key priorities. Collaborative regulatory and stakeholder relationships and operating with excellence paves the way for NYSource to execute on its financial commitments. NYSource continues to work alongside stakeholders through regulatory processes to ensure resources are available for critical investments in safety, reliability, and economic development. One example was a recent Ohio legislative proposal to modernize natural gas rate making. If passed, Senate Bill 103 would shorten the time between capital outlay and recovery. This minimizes regulatory lag and maximizes the value of the investments for our communities. It also creates a special contract approval process to facilitate attracting new large-load customers. This promotes economic development, created job creation to enhance local tax space, and would make Ohio more competitive with its surrounding states. Our dedication to operational excellence continues to advance as we leverage AI in our operations to revolutionize our company and how we deliver service to our communities while driving greater efficiency and enhancing the reliability of our business for our customers. Today, we reported first quarter 2025 adjusted EPS of 98 cents, which is 15% above the same quarter of $0.85 reported one year ago. We are reaffirming 2025 adjusted EPS guidance of $1.85 to $1.89, as well as reaffirming annual 2025 to 2029 guidance for adjusted EPS of 6% to 8%, rate pace of 8% to 10% and targeting 14% to 16% FFO to debt in all years of the plan. Our plan remains resilient and executable in the current macroeconomic environment. The stability of our regulatory foundation and intentional capital deployment is fundamental to the NISORS business plan. Additionally, we are continuing commercial negotiations to support data center build-out in northern indiana while these negotiations continue we have also advanced our pending application to the iurc to establish nipsco genco and support megalo customers our testimony in this process supports four key goals first it protects existing system customers by separating costs the genco strategy shields existing customers from the financial impact of new capacity investments. Second, it allows us to construct the generation resources necessary to serve this customer class with the speed and flexibility that meets their needs. Third, it maintains NIPSCO's financial integrity. As with all investments, we give thoughtful consideration to the risk profile of new investments and how those drive value and ensure a long-term cash flow quality for our business last we're preserving flexibility in our business model by creating another tool within our portfolio to meet the evolving needs of our customers the declination filing requests the Commission to decline jurisdiction on a limited scope of activity related to Genco to support a data center design strategy we are in active settlement negotiations and while we cannot provide an update on this call. If there is any movement on this topic, notice of progress will be followed with the commission. This is an exciting opportunity to advance unprecedented development in Indiana, which could provide significant resources to communities and drive meaningful value to all stakeholders. We're very pleased with the progress we've made and continue to work with potential customers to make this development strategy a reality. Moving on to slide five, our commitment to deliver operational excellence is evidenced through key initiatives to standardize work and enhance risk management. Last July, we launched our Work Management Intelligence Program at Columbia Gas of Ohio. Since then, productivity gains exceeded 40,000 hours across the service territory. We have extended our work management intelligence programs to Pennsylvania, Maryland, Kentucky, and Virginia. In these regions, we have observed consistent productivity gains averaging 16.5%. We are leveraging AI to revolutionize our company and its operations. To date, more than 17 operation centers use AI-generated optimized schedules, resulting in over 60,000 hours of productivity improvement compared to the same period in 2023. And we have introduced real-time analytical dashboards, enabling tracking and performance evaluation at every level, from field operations to executive leadership. Continuous improvement is at the heart of the Project Apollo strategy, which targets sustainable cost savings by reducing inefficiency across our operations. In addition to leveraging AI, we further improve service and reduce waste through other key projects launched in 2025. Meanwhile, 75% of initiatives launched in 2024 continue to provide efficiency in 2025. Moving to slide six, we will highlight progress made on our regulatory agenda. We are proactive on the regulatory front through general rate case and rider filings. A Maryland final order, approved in April, continues a constructive path of approval for critical safety, compliance, and reliability capital additions in the state, including nearly $11 million in investments in 2024. The Virginia rate case remains on track with an order expected in the second quarter. Our Pennsylvania team filed a new rate case to recover over $400 million of anticipated investments necessary to deliver safe and reliable service to our customers. Pennsylvania has a track record of constructive regulation, and our team has achieved a settlement with stakeholders in 11 of the last 12 rate cases. The final order is anticipated in the fourth quarter. The NPSCO electric break case has $2.5 billion of incremental investments for our customers and communities in northern Indiana. In February, we reached a settlement agreement, making our seventh settlement in the last 10 years across both the electric and gas businesses. We expect a final order in the third quarter. Our teams are continuously engaged with key stakeholders to deliver stable and predictable outcomes for our customers while ensuring safe and reliable service in our communities. I'll now turn things over to Sean. Thank you, Lloyd.

I'd like to start on slide seven by highlighting the progress made in our capital expenditures program over the last quarter. In January, Duns Bridge 2 launched commercial operations, making the Duns Bridge Complex one of the largest solar generation facilities in the country. Fairbanks and Gibson construction remains on track with in-service expected this year. All panels were purchased in advance and are on-site, reducing any inflationary risk associated with tariffs on renewable assets in our planning horizon. Across NIPSCO, we continue to advance our energy transition strategy. To date, we've installed renewable nameplate capacity of 2,100 megawatts to support baseload generation for the region. The majority of these assets were negotiated at prices now approximately 50% lower than in today's renewable marketplace. This locks in the cost of our capital investments and positions our customers to access a low-cost energy option for the life of these assets. Continuing on to capital investments on slide eight, there is no change to our capital guidance for our current plan horizon. The outlook projects over $19 billion of investment over the next five years, with over $2 billion of identified upside opportunities for safety and reliability of our infrastructure and customer service offerings. Our capital plan is not susceptible to concentration risk or extended construction timelines. Investments are diversified across electric generation projects, gas and electric customer growth, and transmission and distribution modernization and system hardening. We continue to assess and actively develop our base plan to include only those investments that meet our standards. We continue to assess the incremental investment opportunities shared on slide nine, which include data center generation, electric transmission and gas system investments to support incremental demand, including distribution, transmission, and other infrastructure to support growing communities, the onshoring of manufacturing, and new technology across the region. Finally, FERC-regulated electric transmission projects and MISO's multi-year long-range Transmission Planning Initiative are opportunities to further develop across and beyond our planning horizon. These investments are unquantified and sit outside the base and upside plans which our guidance supports today. Additional development of these strategies is required to meet our threshold to include in either the base or upside capital investment plans. However, we are strongly positioned to advance these strategies, and once we've hit key milestones, new projects will flow through our plans. NYSource is able to be opportunistic in capital allocation decisions due to the strengthened financial profile of the company and enhanced balance sheet positioning. Now, let's cover the first quarter financial results on slides 10 and 11. As Lloyd highlighted, adjusted EPS was $0.98 per share, a $0.13 per share increase versus the $0.85 reported in the same period last year, and represents a 15% year-over-year growth, primarily driven by regulated revenues recovering capital investments from 2024's regulatory activity. These results strongly position NISORS to achieve our full-year financial commitments. We have achieved over 52% of our projected midpoint earnings, which is an increase of 8% compared to the same period last year. All planned regulated revenue increases necessary to achieve our 2025 guidance have been put into rates or pending approval. We're ahead of schedule on our financing plan and have secured at least half of our forecasted 2025 equity issuances and issued $750 million of long-term debt. Lloyd mentioned the resiliency of our business plans relative to the changing tariff landscape. I'll offer a few additional thoughts on this. Productivity enhancements like AI efficiency and Project Apollo reduce time and reliance on materials subject to tariff implications. Approximately 85 percent of our O&M and capital costs are labor and not subject to tariffs. In addition, approximately 97% of our procurement is through domestic Tier 1 suppliers, and our teams have already secured a significant portion of critical equipment to support our operations and capital plans for the five-year horizon. Finally, we operated in a regulated framework that reduces the impact of rising product costs on our business. It is important to note that tariffs have the potential to drive on-shoring and manufacturing expansion in the U.S. We believe our service territory is attractive for location of facilities due to the constructive business climate, the proximity to and availability of low-cost energy for manufacturing services, and a skilled labor force across our region. These fundamentals underpin an attractive opportunity for economic development, providing investment and increased margin into our base plan. Moving to slide 12, we are reaffirming our long-term financial commitments. We are confident we will achieve 2025 guidance and sustain long-term growth throughout the plan horizon. Greater transparency in capital returns, supported by constructive regulatory frameworks, and effective recovery mechanisms provides clearer insight into the financial projections for 2026 and beyond. Our internal forecasts reflect the use of established capital trackers across nearly all jurisdictions and are built on realistic assumptions for load growth, financing costs, regulatory outcomes, commodity prices, and other external factors. The forecasts also include a highly visible inventory of required capital investments necessary to ensure safe and reliable energy delivery for our customers. Beyond that, we maintain upside and incremental investment opportunities not captured in our existing financial commitments, including the potential for data center development. We have built flexibility into our plans in advance of potential headwinds and de-risk execution through our balanced and diversified business plan across six constructive operating companies. We've significantly strengthened our balance sheet and have enhanced our visibility into how the investments we make convert into earnings through reduced regulatory lag and efficient financing plans. Slide 13 highlights those five-year funding plans. We are reaffirming 14% to 16% FFO to debt in all years of the plan, as well as our guided annual equity needs through 2029. A balanced mix of cash from operations, new long-term debt, and $200 to $300 million of equity each year enables us to maintain our capital structure and strong balance sheet position. In addition to traditional sources of funding, the potential use of hybrid securities and senior unsecured debt enhance flexibility and diversification, enabling us to grow without sacrificing credit quality. And finally, on slide 14, you can see we are on track to meet our 2025 financial commitments and build stability into 2026. We are confident in our ability to achieve near-term and long-term guidance, given our strong business fundamentals. Nysource offers investors a diversified and fully regulated utility with the opportunity to invest in programmatic gas infrastructure and long-term energy transition for a fully integrated electric business. This emerging opportunity to support unprecedented energy development and power demand, resulting from robust economic development, onshoring, as well as new data center development, truly differentiates the value proposition relative to many alternatives in the marketplace today. I'd now like to turn the call over to the operator for Q&A.

Thank you. At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. If you would like to read out your question, please press star one again. Our first question comes from the line of Char, Mariza from Gogginheim Partners. Please go ahead.

Morning, Char.

There you go.

Got to love the mute function.

Hey, Lloyd, good morning.

Good morning. Good morning, morning. Just on the NIFSCO, JANCO filing, I mean, obviously understanding it's still ongoing, do you need to receive an outcome in the proceeding before you announce a signed agreement, or can a deal be announced prior? I guess, in other words, do you have a customer you could announce with the approval of the new structure?

I agree. You want to handle that one?

Hello, Char. We could go ahead and proceed with a special contract and announce a special contract without having the GenCo completed. The key of the GenCo is that it provides the flexibility that Lloyd mentioned, really providing the significant protection of the existing customer base and allowing for the speed and flexibility that we know the large load customer needs while enabling the protections that would facilitate a special contract execution.

Scott, just remind us on the PPAs, obviously the structure is still – you're still working for the structure, but if the pricing of the PPAs are above what you're afforded from a regulatory perspective, just remind us how do we think about that?

So one of the nice components of the GenCO structure is it really allows the flexibility to respond to multiple stakeholder needs. and those stakeholder needs, including if there are specific resources that would enable the speed to market, the ramp that would be needed, and or the resource mix that would be needed in order to meet their goals. So the point of that is we would do that, and then NIPSCO will still be the resource adequacy provider to the market. The IRP and the flow-through of the resource adequacy would go through NIFSCO, and at which time we would file a PPA between Genco and NIFSCO, which would be approved by the commission and follow through. So, in other words, it's not a matter of if the PPA is pricing relative to our existing system. It's relative to the special contract, which we would file for execution.

Okay, that's helpful. And then just lastly, the $2.2 billion that's currently outside of the base plan, should you get a signed agreement, do you see an opportunity to accelerate the $2.2? I guess in other words, is there other large load customers embedded in that assumption, or would that be incremental to the $2.2?

So the $2.2 upside does not include any data center development or economic development capital. The 2.2 upside are other projects in the regulated utility that could be potential upside, like AMI, pipeline integrity, and transmission. There's no data center capital there. Any data center capital would be incremental to the plan.

Perfect. Thank you, guys. Fantastic execution. I appreciate it. See you soon. Thank you.

Our next question comes from the line of Jameson Ward from Jefferies. Please go ahead.

Hey, guys, it's Dr. Julian here. Thank you guys very much. Appreciate it. Maybe just to follow up on a couple. Hey, good morning to you guys. If I can follow up on a couple of nuances here, you know, there's been a lot of talk in the state around co-retirement, you know, and federally for that matter. I'd love to hear how you guys are thinking about that juxtaposed against your plan and specifically how you think about, you know, potentially extending the lives of your assets and to what extent that would or could impact your CapEx? Because it's not obvious even if you did hold open your assets if that would change just to say your current spending plans and or your future spending plans predicated on some of this incremental data center load.

So, Julian, we are currently in the middle of assessing the impact of those executive orders. You know, today in our plan, you know, we are still on track to retire Schaefer at the end of 2025. in Michigan City at the end of 2028. Understanding that and taking a look at the executive orders, we're assessing what it would take to extend those and we'll work with various federal and state regulators to do what's best for our customers and various stakeholders and other stakeholders. The important point is we're in the middle of deep assessment on those.

Got it.

Okay, so not ready to say yet about what the net impact would be. And then maybe just if – excellent. And then keeping it in the same realm here legislatively, I understand the state recently passed some updated CPCN procedures and procedural timeline requirements at that. Can you speak to how that might provide a further avenue for your data center filings, especially to the extent to which that your novel declination effort may or may not go through? I mean, does it provide you a further expedited effort to get a timely outcome? If you will, it seems like a third way.

I think you're talking about Senate Bill 1007. So the declination filing is separate from 1007. 1007 just gives you another path for large load customers. I mean, so we're pursuing the declination filing. Remember, we said in the past that's only one of the mechanisms we have to deal with this counterparty of these load opportunities. Senate Bill 1007 just gives us a second or even a third pass.

Right, indeed. And just does that make it more likely? I mean, when you think about the pathways here and what you're seeing. In fact, let me just ask you directly here. I mean, with respect to Genco, is your expectation here that you would, you know, given that you've now seen very clearly where parties stand, have a pathway to potentially settle this out? Or at what point do you kind of elect to pursue this expedited CPCN process, especially given how timely some of this generation may need to be moving forward?

So let me say a couple things. One is we're in the midst of settlement discussions, so I can't talk in detail about those because they have not been concluded. I think in terms of following this gen code, we think it's a really good path in terms of dealing with the counterparties. It meets the four pillars I talked about in my prepared remarks, good for customers, good for our financial integrity, you know, gives us the speed and flexibility we need, and we're optimistic about, you know, completing that process. But we're also looking at Senate Bill 1007 as another path, and we'll evaluate that if GenCO doesn't pan out for us. Melody, you want to comment on that?

Sure. Julian, good morning, and thanks for your question. So, to Lloyd's point, House Bill 1007, it really didn't change any currently available options for utilities to serve large load customers. And also, to Lloyd's point, what it did do was add those additional options. So expediting the generation resource planning process, as well as it provides for a 150-day review of an application for a utility to serve the load. So our strategy remains the same. So it really doesn't change any of the options that are available for us to serve large load customers.

Excellent, guys. Thank you so much. Appreciate it.

Thank you. Our next question comes from the line of Richard Sutterland from J.P. Morgan. Please go ahead.

Hi, good morning. Thank you for the time today.

Good morning, Richard.

I appreciate the discussions are still ongoing, but could you just offer any thoughts on sort of the pace and engagement with your large load, prospective large load counterparties, you know, maybe relative to 4Q or last fall? You know, there's certainly been a lot of attention here broadly on sort of reaffirmations, what have you. Are you seeing that following through on your end in talks?

Yeah, let me address that. If you go back to the end of 2024 and then in February of 2025, you know, what I said was that, you know, hyperscalers, large low growth would be a 2025 activity. We'd really be focused on 2025. What I'll say to you is we're making excellent progress. But what's really important to understand is these are complex and complicated transactions, and they may require a lot of time, and I'll say management attention, but, you know, we want to make sure we get this right. You know, I'll go back to my four pillars in getting it right. It's good for customers, good for financial integrity, meets the speed and flexibility of our counterparties, and protects our business model. And I'd say we're walking down that path. We're excited about this opportunity. We think it's really good for NYSource and good for all of our stakeholders. And as soon as we have more information or more news, we will, you know, communicate that out to the streets as fast as possible. I think if you take a look at what some of the hyperscalers, the developers have talked about in terms of their capital plans, They continue to actively invest in building and developing data centers. I think that will give you a signal on how robust the network of people who are interested in that. If you look at what we've talked about in terms of Indiana being a great place to invest, I will tell you that we have a lot of opportunity, but we want to make sure we get this right. color there.

And then circling back on the GenCO discussion, what would the regulatory cap structure look like for that entity? I think there is a peer recently filed a tariff that specifies a higher ROE for this type of activity, pursue something separate versus what NISCO has authorized. Is that something we could see in the settlement, or do you need a separate contract or rate case to decide. Any thoughts there would be helpful.

Michael? So we haven't discussed or disclosed anything associated with the financing structure with Genco. We are continuing working through and focusing on completing the special contracts with customers and working through that development of those activities.

Thank you. Our next question comes from the line of Nick Campanella from Barclays. Please go ahead.

Hey, everyone. thanks for taking the questions.

Good morning, Nick.

So I just, hey, good morning. I just wanted to follow up quickly on the settlement discussions. Just do you anticipate hearings to still kick off at the end of this week here if a settlement is coming?

Again, as I mentioned, we are in midst of settlement discussions. When we have detail on those, we'll let you know as soon as possible, but we can't comment on specific discussions or timing with respect to those right now.

Okay, no problem. And I just wanted to confirm a, you know, as you think about getting to a commercial agreement with any customer, that is not explicitly tied to the timeline of these proceedings or the potential settlement?

That is correct.

Okay, great. And then, you know, just on the assessment on the call, just going back to Julian's question, you know, this NISCO IRP out there that's calling for long-term resource solutions that's, you know, I would say that's probably likely well beyond the current timeframe for how long the coal could stay online for. So just, you know, do you see that truly impacting your long-term procurement strategy at this point just to supplement the generation needs and the load growth that was detailed in the NISCO IRP?

Michael? So when we look at the IRP and we look at the extended plan with the IRP, we will need additional resources for the IRP, despite all alternatives in evaluating the executive orders. As you look at MISO's direct loss of load rules and the changes associated with resources and the accreditation of resources, we know we're going to need additional capacity on the system in order to facilitate the reliability and resiliency of the system.

Thank you very much.

Thank you. Our next question comes from the line of Bill Apicelli from UBS. Please go ahead.

Hi, good morning. Just another question on the Genco. I guess, you know, it's clear that you can make the special contract filing concurrently or separately from resolution of the declination filing, but given some of the complexities that you've outlined, is it prudent or is it a preferred outcome to have sort of visibility on the declination filing before filing a special contract, given that some of the framework would likely need to be embedded within the terms of the contract?

We feel the declination filing provides a very strong capability to meet the core pillars that we've discussed previously. Obviously, we look forward to the declination filing moving forward. But when we think about protecting the existing customer base, providing the resource alternatives, we can do that through multiple mechanisms regardless of the declination filing. However, the declination filing and the results of that, we feel, provides a very strong capability to meet stakeholders, large load customer needs, and protect our existing customer base. So when we look at the alternatives with 1007 or we look at other alternatives that are available to us. We have multiple paths by which to get to the solution. However, the declination filing is, we feel like, is the best alternative by which to meet all stakeholders' needs.

Okay. All right. Great. And then can you just speak to some of the federal levels, some of the policy changes that have materialized here around tariffs, and then and maybe speak to exposure around any potential changes to the IRA as it relates to, you know, renewable tax credits and transferability?

Sean, you want to take that one?

Sure thing. On tax transferability and IRA, PTC and ITC, most of our renewable projects plan to be online by the end of this year. It leaves a limited window for direct PTC-ITC challenges that are not retroactive. Really, only Templeton is the only base plan asset, really, that's beyond the horizon here in 2027. So the plan assumes an ongoing PTC transferability, 2026, 7, and 8, of about 40 to 60 basis points. So, you know, we're pro-tax credits of benefiting customers and helping existing customers today realize those tax credits. That's helpful to keep energy costs down for customers today. But as we think about the financing plan implications and what the IRA brings to the existing plan itself, We believe our existing plan, the strengthening we've done on the balance sheet, the cushion above our downgrade threshold, I wouldn't suspect a change to our financing plan as a result of potential appeal of tax transferability. And I think we noted this in my prepared remarks on the implications associated with tariffs. We're in a really strong position, both from a standpoint of labor activities, a high degree of domestic content in our supply chains, continuous improvements such as Project Apollo. We think that those can help us face the potential changes associated with tariffs. A fully regulated compact itself helps us get line of sight to where things could reset themselves. We've built the track record of being thoughtful around long-term energy costs for our customers and evaluating those overall impacts, delivering flat O&M really for an extended period of time amidst a range of economic conditions. We'll be able to right-size our plans to ensure that we can pass this forward and face whatever comes our way from tariffs without any changes to our existing financial commitments.

Thank you very much.

Thank you. Our next question comes from the line of Travis Miller from Morningstar. Please go ahead.

Good morning. Good morning, Travis.

One more on Genco, if you don't mind. As you're talking either through the settlement and official discussions or just outside of the official discussion. Are there any parties that are strictly opposed to this or is it just a matter of devils in the details getting all those aligned?

Again, Travis, we can't comment since we're in the middle of active settlement discussions on the GenCO. We can't comment on the position of any specific party right now.

Okay, that's fair. Other topic, transmission. I think as Sean mentioned, milestones in terms of other projects. I wonder if you could characterize what some of those milestones are, what you're waiting to see or hear transpire before you add some of those transmission projects.

Yeah, sure thing, Travis. So when we think about MISO long-range transmission projects, both the executability from an operational standpoint, the construction, and making sure that we understand what the costs are going to be to install those assets and operationalize those assets, and then juxtapose that with the regulatory compact itself, making sure that we understand the mechanisms that will pick up those costs. Once we reach that degree of certainty around those two elements, you'll see those flow into our base plan. As a reminder, we do have a nominal amount of MISO tranche 1 projects in our base plan, as well as some in our upside plan, which Lloyd highlighted earlier. We do not have MISO long-range transmission tranche 2 projects in either the base plan or really in the upside plan as it mostly persists outside our existing financial plan horizon. But we do expect the tranche 2 projects to start to come into fruition towards the latter part of this plan horizon, and we think that could be additive to the upside plan once we've gone through the work to commercialize and develop our plans to operationalize those assets.

Okay, great. When you mean Planet Horizon, you're talking 2029 and beyond, or 2030.

Yep, that's correct. Very good. Appreciate it. That's all I have.

Thank you. Our next question comes from the line of Wall Research. Please go ahead.

Hi, it's Steve Fleischman.

Good morning, Steve.

Just, I'm going to avoid asking about Indiana. But in your kind of bullet about data centers, you said to support data center strategies across Indiana, Ohio, and Virginia. I might have missed some of this, but just could you talk a little more on what you're doing in Ohio and Virginia related there and opportunities for you?

Well, I'll throw it to Michael or Melody. You guys, which one? Go ahead, Melody.

Hi, Steve. Thanks for asking the question. So, we do talk a lot about Indiana being ripe for data centers, northwest Indiana, but we're seeing activity in Ohio as well. And so, our teams are working with the local and state entities to look at what these data center needs are and how and if we can support them. And so I'll just say that we're staying engaged with the local and state economic development entities to look at how we can serve those customers, those potential customers.

To Melody's point, most of that investment for us is natural gas infrastructure pipeline. So if you think about Virginia and Ohio, as these developers come, they're going to need energy. So that allows us to invest capital to put in gas pipeline to support data center activity.

Separate topic, just the MISO auction outcome that we just had. I know it's for kind of more of a near-term year, but just any kind of broader thoughts from that, because obviously a big uptick in pricing and how it impacts your plans.

Yes, we've seen the MISO auction, and we are evaluating its results. And, you know, we look through the IRP consistently to make sure that we have the resource adequacy we need. But when we look at the MISO auction right now, we're well positioned within the current plans we've filed from the IRP.

Thank you. Our next question comes from the line of the company, Leidenberg. Please go ahead.

Thank you very much. I guess a procedural question. If you wanted to delay the start of hearings on Friday, you would have to file a notification either today or tomorrow. Is that correct?

That is correct.

And then the other question I have is, beyond sort of what you're seeing with data centers, are you seeing any activity with respect to onshoring or industrials announcing sort of major expansions in Ohio? I mean, in Indiana.

Yeah. I think so, again, we're seeing recently for battery manufacturers, we're seeing some expansion. One of the things we're seeing is the answer is yes. Indiana is, I'd say, very well positioned for onshore with one of the opportunities being a battery manufacturer. But in terms of economic development, our team up there is really busy with manufacturing above and beyond data centers.

Sean, you want to weigh in on that? Yeah, just a couple more. I mean, the cold storage sector continues to grow in Indiana. We've seen a couple food organizations come in with food manufacturing and cold storage providing jobs, as well as $70 million of capital investment into the region, $70 million for their facilities, not ours. But cold storage also in Crown Point also continuing to develop in that theme. So NIPCO has continued to see a general increase on manufacturing projects across the year. Several international companies are exploring opportunities to establish in Indiana a plastics manufacturer, a biopharmaceutical firm, a recycling operation, each poised to deliver new job opportunities in Indiana and bring significant investments in the state, as well as EV battery manufacturers, which we've seen come up a couple of times. So Indiana continues to be robust, but we're also seeing it in Virginia. We're also seeing it in Ohio. You highlighted that one. So we're seeing it across our service territory. All of this really precedes any of the changes from the tariff landscape, right? Most of this was already in pipelines working, and our states do a great job of trying to attract global companies to come in for our research.

Thank you very much.

Thank you. Our next question comes from the line of Ross Feller from Bank of America. Please go ahead.

Morning, morning, Sean. Hey, Ross. So I'll be brave and ask another one about Indiana, but I won't ask about the settlement process, because I'm not going to make you re-answer that one. Just from like a 30,000-foot view, right, it seems like, you know, Genco sort of versus a straight large load tariff filing has added a little bit of, you know, regulatory process and complexity at the beginning. Can you kind of just, in your mind, frame from a very high level what you guys see as the advantage of the Genco structure? I mean, you kind of touched on it with, you know, do, like, pricing differences with large-load customers, but are there other advantages as you see them? And then the corollary of that question, as you look to Steve's question around Ohio and other segments, If you're successful with GenCo in Indiana, do you see, like, a pipe co in Ohio or something like that to structure it similarly? Thank you.

So let me go back to why we believe GenCo is our preferred path to success. And I think it's a really good question. I think the first one, I talk about our current, it protects our existing customers by allowing us to separate the costs, separate costs. I think second, it gives us a faster speed to market. Remember, we're asking the IEU RSC to decline, you know, the CPCN, which is typically a 240-day process. So that gives us a faster speed to market to deliver the generating resources for the counterparties. And if you listen to the counterparties and look at their capital needs and how fast they want to move, speed to market matters a lot. I think that negotiating a special contract, you know, with the counterparties gives us a lot of opportunity in terms of flexibility as we look at risk versus return in this. I mean, this is one of the complicated parts of the process, but it could give us more opportunity depending on the risk we're willing to take, and I think that matters for us. And let's preserve the flexibility of our current business model. You know, if you look at the last three years, I think our EPS CAGR has been 8.5%, so we have a really strong financial plan, and we want to protect the integrity of that plan. and to make sure that this opportunity goes above and beyond our current business financial plan. So we like it. We think it's – I mean, I'm biased, but we think it's a really good idea. We're excited about it. We're excited about the opportunity.

That's great, Lloyd. And then you touched on it. There's a different sort of risk dynamic, maybe connected with these large low-cost customers. So doing the Genco structure allows you to think about return differently. And I know you haven't kind of fully decided the capital structure yet, but could you think about leverage differently as well?

Sean? This just goes back to Lloyd's comments on flexibility. We've got a lot of different avenues that we could go to make this efficient for our customers and for our shareholders. We're motivated to bring the lowest cost of financing into the marketplace that we possibly can. I think everyone is in this particular case, and it will help us advance the strategy quickly.

Perfect, Sean. I'll see you guys down in Florida soon.

Okay.

Thank you. Our next question comes from the line of Christopher Jeffrey from Mizuho. Please go ahead.

Hi. Thanks, everyone. Just one from me regarding O&M. It's kind of ticked higher in the last couple of quarters. And I think, Sean, you discussed some of the successes at Apollo and the flat O&M expectations. But just to put a finer point on it, as far as the run rate from here, Are you expecting Apollo to kind of have deflationary impacts from here, or how are you?

Over the course of the year, we continue to expect O&M to be flat year over year at around that $1.4 billion level that we've been able to maintain since 2016. Project Apollo helps drive that through an array of different opportunities, both efficiency as well as just identifying waste that can be one time in nature and reduce the overall cost profile of the business. And our employees lead that each and every day. New ideas populate what fuels its mission and how we are able to obtain that flat O&M on a year-over-year basis, again, really since 2016. That said, we also need to invest in our system. We make strategic investments to risk-adjust the system on an ongoing basis. Things like vegetation management, leakage, they don't always track the same quarter-over-quarter, but they get to the right place at the end of each and every year. and we try and pick the opportunities that we have to ensure that we can be always risk-adjusting the system to ensure reliability of our system at all times.

Thank you.

Thank you. Our last question comes from the line of Ryan Labian from Citi. Please go ahead.

Hi, everybody, and thanks for squeezing me in. Good morning, Ryan. In terms of your labor contracts, Can you remind us when those labor agreements expire and what the process of renegotiating labor rates is in here?

They start.

Well, Bill, I'll let Bill Jefferson answer this.

The NPSCO contract ends the end of March of 26. The Pennsylvania contract ends at the end of August of 26. And I don't have the dates for the Ohio contracts top of mind, but those are two of the biggest.

Everything gets renegotiated in 2026.

Okay. Thank you. And then in terms of the EV or electric vehicle supply chain, what portion of your load in Indiana and across your service territory is tied to that industry, both historically and on a prospective basis?

Extremely minimal.

Okay. So the EV batteries, to the earlier comment, is extremely minimal to the outlook, despite the… Yeah, right.

When you think about what the EV battery manufacturers need, ironically, it's natural gas. And the expansion of our natural gas network itself, and really with a high-capacity trunk line, enables us to then market potentially to new communities that need the development of natural gas and extend the overall network itself. So it's actually pretty small on the electric system itself, larger on gas. But, of course, as you know, the transport volume on gas isn't a significant revenue driver for us. It's really getting the infrastructure deployed and then enabling us to potentially gain more customers with a lower-cost fuel and a more reliable fuel at that.

Great. Thanks for taking my questions.

Thank you very much for the questions at this time. I will turn the call back over to Mr. Light.

Yeah. So we thank you for your continued interest in NISource and your questions, and we look forward to communicating with you in the future. Have a great day.

This concludes today's conference call, you may now disconnect.