New Jersey Resources Corporation (NYSE:NJR) Q1 2023 Earnings Call Transcript

Roberto Bel: Hey, Rich. Good morning. This is Roberto. How are you? So on your question, the performance that you saw was primarily coming from Energy Services, but it was not only coming from Energy Services, right? It came also from the utility with higher BGSS incentives and also from our Storage & Transportation. So it was really broad-based once again and coming from most of our businesses. But as indicated in our remarks, the biggest part came from our marketing business.

Richard Sunderland: Okay. Understood. And then turning to CEV here. Just I guess the first part, I see the 43 megawatts place in service. I know you referenced the landmark projects there. I also think there was a 100 megawatt change and if I’m reading this correctly on ’23, ’24 contract and exclusivity. Is that a timing shift across the years laid out here or are there other changes on kind of the project front in light of those PJM and New Jersey developments you referenced earlier?

Steve Westhoven: So Rich, I think the way to look at that is that when you look at Slide 7 and you look at the total of about 1 gigawatt of potential investments, the way that we describe them, that number — or at least on a yearly basis or the periods that we say, it’s going to go up and down. As projects come in, they get completed. As more projects come to exclusivity or some sort of a firmer commitment that we can put them part of this chart that these numbers will go up and down. But I think the big numbers to look at are we’ve got a very robust pipeline of investment at CEV for our solar investment. And then also, the other big number is, yeah, 43 megawatts that we’re able to put in service. So we’re investing money, we’re completing projects, we’re putting them into service and then we’re continuing to develop the pipeline moving forward in this business unit.

Richard Sunderland: Got it. That’s helpful color. Maybe just a quick follow-up there. So you referenced the positive progress with PJM and from New Jersey as well. Just curious kind of milestones going forward from here or high level timing expectations. What are you watching for this front for, I guess, that incremental clarity into the outlook said both the PJM level and the state level? Anything you can offer there on how that might unfold over this year or what else you’re looking for from each institute?

Steve Westhoven: Yeah. I’m going to ask Amy Cradic to answer that question. And she manages our non-utility businesses and CEV, and she can speak to some of the details associated with the PJM process and certainly in the process of the state.

Amy Cradic: Yeah. I would say that the PJM Q reform and the BPU competitive solicitation, they’re both very positive. But our CapEx production, they’re not fully dependent on those. So we’re still waiting for other state policy and programs to roll out. I’ll give you a few examples with TREC approvals we’ve spoken about in the past for some of our projects do use virtual net metering. So we’ll continue to watch the progress out of that, all positive, and we see additional optionality and opportunity for our pipeline.

Richard Sunderland: Got it. Thank you for the time today.

Steve Westhoven: Thanks, Rich.

Operator: Our next question is from Gabe Moreen from Mizuho. Gabe, your line is now open. Please go ahead.

Gabe Moreen: Thank you. Good morning. Can you maybe talk about, I think, the Leaf River expansion potential? I think some midstream names out there have talked about some customer interest now, and I think the value of storage has clearly proven itself out time and again over the last, call it, 24 months. So just curious, latest thoughts on what the lease expansion is looking like?