FTS - Fortis Inc. Announces New $25 Billion Five Year Capital Outlook and 4.4% Increase in Fourth Quarter Dividend Marking 50 Years of Dividend Increases | Benzinga
ST. JOHN'S, Newfoundland and Labrador, Sept. 19, 2023 (GLOBE NEWSWIRE) -- Fortis Inc. ("Fortis" or the "Corporation") (NYSE:FTS), a well-diversified leader in the North American regulated electric and gas utility industry, released its 2024-2028 outlook1.
Highlights
- 2024-2028 capital plan of $25.0 billion, representing 6.3% rate base growth; up $2.7 billion from 2023-2027 five-year plan
- Growth largely driven by investments in transmission in the U.S. Midwest and resource transition plan in Arizona
- Fourth quarter common share dividend increasing by 4.4%, will mark 50 years of consecutive increases in dividends paid
- Annual dividend growth guidance of 4-6% extended to 2028
"Our Board of Directors declared a fourth quarter dividend representing a 4.4% increase that will mark 50 years of consecutive increases in dividends paid," said David Hutchens, President and CEO, Fortis Inc. "This makes Fortis one of only two companies listed on the Toronto Stock Exchange to reach this significant milestone."
"Our sustainable regulated growth strategy is focused on delivering cleaner energy that remains affordable and reliable for our customers while supporting annual dividend growth of 4-6% through 2028," said Mr. Hutchens.
New Five-Year Capital Plan
Today the Corporation announced its new 2024-2028 capital plan of $25.0 billion, the largest in the Corporation's history, and $2.7 billion higher than the previous five-year plan. The increase is supported by the Inflation Reduction Act of 2022, and largely reflects regional transmission projects at ITC associated with tranche one of the Midcontinent Independent System Operator long-range transmission plan, as well as investments in Arizona to support Tucson Electric Power's exit from coal. Investments supporting system adaptation and resiliency, customer growth and economic development are also driving growth across our entire footprint.
The five-year capital plan is low risk and highly executable, with nearly 100% regulated investments and 18% relating to major capital projects. Approximately 27% of the five-year capital plan is allocated to cleaner energy investments focused on connecting renewables to the grid, renewable and storage investments in Arizona and the Caribbean, and cleaner fuel solutions in British Columbia. The Corporation's $25.0 billion five-year capital plan is expected to increase midyear rate base from $36.8 billion in 2023 to $49.4 billion by 2028, translating into a five-year compound annual growth rate of 6.3% on a constant foreign exchange basis. The plan maintains a focus on customer affordability, while ensuring reliable and resilient energy delivery service as the Corporation transitions to a cleaner energy future.
The five-year capital plan is expected to be funded primarily by cash from operations and regulated debt. Common equity proceeds are expected to be sourced from the Corporation's dividend reinvestment plan and an at-the-market common equity program.
Beyond the five-year capital plan, additional opportunities to expand and extend growth include: further expansion of the electric transmission grid in the U.S. to facilitate the interconnection of cleaner energy, including infrastructure investments associated with the Inflation Reduction Act of 2022 and the Midcontinent Independent System Operator, Inc. long-range transmission plan; climate adaptation and grid resiliency investments; renewable gas solutions and liquefied natural gas infrastructure in British Columbia; and the acceleration of cleaner energy infrastructure investments across our jurisdictions.
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1 All information referenced ...