CenterPoint to forego $110M of profit related to storm hardening, backs EPS view

In a regulatory filing, CenterPoint Energy stated: “In August 2024, CenterPoint Energy Houston Electric, or ‘Houston Electric,’ an indirect, wholly-owned subsidiary of CenterPoint Energy, announced its Greater Houston Resiliency Initiative, or ‘GHRI,’ which includes a series of targeted actions to improve the resiliency of Houston Electric’s electric grid this hurricane season. On August 28, 2024, Houston Electric announced the completion of core resiliency actions as part of the first phase of its GHRI, which included certain vegetation management and pole installation goals. Additionally, Houston Electric announced a new series of resiliency actions, including (1) a second phase of GHRI, which will include actions strengthening grid resiliency, improving public and customer communications and strengthening local, community and emergency partnerships; and (2) a longer-term proposal, for approximately $5 billion in resiliency investment from 2026 to 2028, which Houston Electric intends to include in a new system resiliency plan that is expected to be filed with the Public Utility Commission of Texas on or before January 31, 2025 following feedback from customers, external experts and other stakeholders, including elected officials and local agencies. The Company also announced its proposal to forego approximately $110 million of profit related to its storm hardening and temporary emergency generation efforts, which will be represented by two components. First, Houston Electric intends to absorb approximately $70 million in incremental storm hardening expenses incurred in connection with accelerated operational activities after Hurricane Beryl. Second, Houston Electric does not intend to file in future years beginning in 2028 for approximately $40 million in anticipated equity profit associated with load-shed oriented temporary emergency generation leased by Houston Electric through the remaining regulatory life of the leases in 2032 as new dispatchable generation comes online in the state of Texas as a result of the Texas Energy Fund… The Company reaffirms its previously announced non-GAAP earnings guidance.”