Garrick Rochow: Yes. And similar to my previous answer here on this that Dearborn Industrial generation we take a very conservative utility-like approach. And as you know over time we’ve just stacked in contracts for energy and capacity bilateral contracts to make sure that we are avoiding risk and market volatility. But we certainly, see some upward pressure on both energy and capacity prices as you noted. And so much of the energy and capacity is already — contracts are already in place through 2025. but we’re filling in the gaps at 2026 2027 and out years. We plan conservatively and those contracts are I would say, exceeding our expectations or exceeding our plan, which is great. And so we’ll continue to operate just as we have historically in a really conservative mode and a conservative plan, but you can see we’re layering in the future right now and feel good about the opportunities for growth at DIG.
Julien Dumoulin-Smith: Excellent. And then just quickly if you don’t mind, the status of the solar projects just where that stands and the schedule for bringing those into rates. Sorry, just to clarify that. I just wanted to hit that as a last quick one.
Garrick Rochow: We feel good about our renewable build. And in this electric rate case, we pulled out some of the renewable build. But I’ll be honest with you, 25 years in this business been in engineering operations much of my career. There’s projects and contracts that move between years. That’s not a big deal. And much of our build this year is in wind. We’re going to be COD here end of the year at our Heartland wind farm. We’re building another 201 megawatts of wind. And so there’s a lot of renewable build that’s underway in these years. And so those projects that were referenced in the electric rate case were some of the ones that early got caught up in some of the ops and solar complaint-related issues. We’ve talked about that that’s been hashed through in this industry.
I felt good about the projects we have in mid-development right now. We have line of sight into panels. We got good sighting pieces. And so that will play out as part of our IRP build. The other thing is, these all projects don’t go away. Remember that, these are part of the IRP. And so they’ll get constructed here. It’s just a matter of timing and that timing is being refined here. And I think at least one of them is going to go this year anyway so we’re going to see some construction there. And remember, because they’re approved in the IRP they get AFUDC along the way. So there’s no earnings impact. Make sense?
Julien Dumoulin-Smith: Good luck, guys. Thank you so much.
Garrick Rochow: Yeah. Thanks, Julien.
Operator: Our next question is from the line of Shahriar Pourreza of Guggenheim. Shahriar, your line is now open.
Shahriar Pourreza: Hey, guys. Good morning. As we reflect on your kind of prior guidance for $350 million of equity starting in 2025 does kind of that increased CapEx plan move your equity needs proportionately higher.
Rejji Hayes: Shar this is Rejji. Yeah, so we’re still in the relatively early stage of building out — sorry Shar? Shar, this is Rejji if you can hear me. So we’re in the early stages of rolling out our five-year plan. So we’re still calibrating where — what the financing needs will be. As I’ve said before, the estimate that we have in our current five-year plan, where we said up to $350 million a year of equity starting in 2025. I don’t see that number materially changing. Now, as the CapEx plan increases again we always recalibrate you may see a slight shift upward but we — we have to take a look at all of the puts and takes the capital investments the cash flow generation. And I think at the end of the day you’re not going to see us with any sort of need to do block equity. I still think even without seeing the numbers we’ll be able to double out the equity in those outer years. But again, still early days on those calculations.
Shahriar Pourreza: Okay. Perfect. And then just from a stakeholder perspective where is the MPSC going with sort of the investigations into storms at this point? And I guess, what’s the range of outcomes you guys anticipate and we’ve seen some comments filed but there seems to be a negatively skewed mechanism for penalties versus rewards
Garrick Rochow: So there’s two pieces. And I wouldn’t put a negative take on it. All the conversations we have with staff and commissioners continue to be constructive and frankly we’re both aligned in the same thing. We want to improve reliability. We have a longer-term view of resiliency. And when we’re aligned it makes for constructive conversations. But there’s two pieces that I’m hearing in your question Shar. There’s one there’s the audit that’s underway. That was started in September. Liberty Consulting Group is the one doing the work. They’ve participated with other utilities very skilled organization. Right now they’re in the data collection phase that’s well underway. We expect an interim report about the end of the year and then a full report likely in the September-ish time frame.
It’s not about a year report then. But I would just be fully transparent with you and honest I want reliability to improve in the state. I want resiliency and improvement in the state for our customers. And so if they have findings on how we can do work better, my gosh, I’m just going to agree to them. Like we should build that into the next electric grid case. We should do that because we want it better for our customers. And so it doesn’t bother me at all. I think this is good that we have an outside party looking and looking at how we can improve. It’s only going to add to our reliability road map. And the other thing is on this performance-based rates or PBR, the work group is underway. It was initiated in the first second quarter time frame April-ish time frame I believe.
And so that conversation is underway, proposal was put out. We have put comments through that process. We’re continuing to participate in work groups. At the end of the day I think you’re going to have a nice balance of incentives disincentives from an electric reliability perspective. But the important piece for us is making sure there’s a nice line of sight into capital and the capital recovery and there’s certainty. That’s why we’re so focused on this investment recovery mechanism. We also think the same thing is required for storm and some of the O&M expense that occurs in the year. As long as we can navigate all that and get to that point I feel good I feel good. This will lead to good outcomes for our customers.
Shahriar Pourreza: Got it. Perfect. Thanks, Garrick. Appreciate it. Thanks, Rejji.
