It just means that they may have to trade off different capital within their plan. They might have to prioritize it a little bit different. And worst case, this is the world I lived in Arizona, was, every once in a while you get a little regulatory lag because you don’t get a media recovery for it. But if they’re that if they are investments that need to be done and need to be made on behalf of our customers to provide reliable, power to, do whatever we might need to do from a resiliency perspective, we make those investments and then we’ll get it we’ll get it on the next round. But you need to want to add a little color on the, impact of interest and how you guys would be managing that.
Janine Sullivan: Actually, thanks, Dave. You’ve covered it quite nicely. We are planning to execute our 2024 capital plan as we come to understand the various components of the PBR-3 plan as they were determined last year. So, there’s a lot to digest with respect to where we have levers, where we can manage costs in certain areas to address the shortfall potentially in capital funding. We do plan on bringing or utilizing some elements of the plan with respect to type one capital where we go forward with very specific requests to the AUC while this reconsideration of the methodology that they use to establish capital funding is also ongoing. So, certainly, all the steam ahead just continuing to deploy capital as we can and managing our costs as we do so until we see some of these other mechanisms start to apply.
Operator: And your next question comes from the line of Michael Sullivan from Wolfe Research. Your line is open.
Michael Sullivan: Hey, good morning. Hey, Michael. Yes, hey Dave. I’ll just try another one on the MISO Tranche 2 map. I know it’s a little early, but maybe just relative to how you were feeling when you saw the draft map for Tranche 1. Does this feel like, better opportunities set or worse?
David Hutchens: Oh, Yes, I can provide some directional color there. There’s a lot more lines on the map and they’re different color lines, right? So, the 765kV is exciting. Those are obviously big projects. the size of the overall portfolio, the estimates are in essence twice the size of Tranche 1. So, directionally, it’s looking pretty good. Obviously, we don’t know where those lines will fall down exactly. We’re not sure what the final package will look like, but I think we’re all very comfortable and confident in saying it’s a lot bigger. How that allocates to ITC will, that’ll come out in the wash as we go through the process the rest of this year.
Michael Sullivan: Okay, I appreciate that. That’s really helpful. And any chance you could also just give a little color on, more color on just how the legislative session in Iowa ended up playing out and was it just a matter of time or not enough support? Can you give this another shot next year? Yes, just more color on that would be helpful.
David Hutchens: Yes, I think the short answer is, politics are always a little hard to call exactly how the process is going to work. I think the team did a fantastic job getting up there in front of the legislators, getting the support that’s needed, but it’s some, periodically you just can’t get the things to be brought up and debated. And when that happens, you just say, okay, well, we’ll give it a go next time. And I think that’s, one of our others, there’s, obviously, as Jocelyn mentioned, her prepared comments that what we think about our existing Tranche 1 and, why those are and should still be allocated to us and the 70% that’s in our rights of way. And I mean, we’ve still got, layers and layers of arguments and appeal to boot on those Tranche 1 projects.
So it’s really, so what do we do next? And I think the conversation around, looking again next year from an Iowa perspective, recalling also, as we talk about Tranche 2, we still have our rovers in Minnesota and Michigan. Also, you never know where those lines will land in relation to our existing rights of way. And as we sit here today, we’re just around the corner from putting out their planning and cost allocation rule that will, which could address some, at least on a limited basis, some of the federal rovers that they at least tossed out there in the no-bur. So we’ll see where that goes and we’ll take, that whatever, I think I listed about seven different things that that team’s working on related to this. And we’ll just, stack them up and go through them.
Michael Sullivan: Okay. Thanks. And last one for me, if you could just update us on the Arizona process and the workshops there that I think have kicked off on trying to improve regulatory lag, how you see that going so far?
David Hutchens: Yes, it’s positive. I mean, very positive. It’s got two different options that they’re looking at there, whether it’s a formula rate or a forward test, your reach comes with a different sort of batch of questions and issues within the Arizona regulatory and legislative construct. But at the end of the day, it’s all positive. It’s, either one of those is better than a regulatory lag basis that we’re working on now. Obviously, we got the SRB, the System Reliability Benefit mechanism that allows us basically a capital tracker that we got at UNS Electric. We expect that next time we file a rate case, a TEP will file for one as well. That’s a great sort of second place for something like a formula rate. But again, we’ve got a couple different options there. And we’re just glad to see that it was getting traction that after the first workshops that they are looking at continuing them. So that’s all positive.
Operator: Thanks so much. Appreciate it. Thank you. Your next question comes from the line of Mark Jarvi from CIBC Capital Markets. Your line is open.
Mark Jarvi: Yes, thanks, morning everyone. Just with not full clarity on the roper issue, legislative process, the court process, haven’t played out in your favor yet. What does that mean in terms of keeping certain projects in the five-year plan? What would you need to see or what would happen for you to withdraw that? And then, once the lines are drawn in and you see the allocation on the charge to projects in light of the roper issues not being settled, do you hold back in adding those to the five-year plan? I appreciate a lot about comes maybe beyond the five-year plan, but anything that is within the five-year plan, does that preclude you from adding in your term?
