It’s manufacturing which obviously drives jobs, which drives housing, which drives the economy in general. And some of the Inflation Reduction Act incentives for domestic content are really driving some of these manufacturing facilities. So it’s good to be in that service territory. And that’s really setting aside even the latest Michigan Clean Energy Legislation that is increasing the pace at which they have to get to 100% clean energy, which is by 2040 now due to that legislation, which I think is missing in a fair number of forecasts. Now that’s not on the demand side. That’s on the supply side. But of course, that drives renewables transmission and the rest of the things that we are really fond of.
Rob Hope: Appreciate that. Thank you.
Operator: Our next question comes from the line of Linda Ezergailis from TD Cowen. Please go ahead.
Linda Ezergailis: Thank you. I’m just wondering if you can help us understand just a further to Maurice’s question. Given the lack of wiggle room in your financing and your debt metrics, might that tilt you towards kind of pre-funding to kind of give you a little bit more, not wiggle room, but to anticipate maybe some surprises and maybe might you be more inclined to opportunistically consider divestitures and how might that manifest itself? I’m also wondering how you’re approaching opportunistic acquisitions. Would you need to high-grade that or might that prompt using the ATM given some of the other moving parts?
Jocelyn Perry: Linda, this is Jocelyn. I’ll take the first part of that question. Yes, I mean, we’re always looking at pre-funding opportunities if the market should open and timing of when we actually go into the market, but with respect to this particular rating, I wouldn’t expect it to materially impact our costing if we had to go to market even with this negative outlook there, so – but you’re right. I mean, we do look for opportunities to go to market, so I would say that’s always on the docket for us. And with respect to the ATM, the ATM is there and that’s exactly why we put the ATM in place. It was to give us some financial flexibility for events, particularly around growth that is either unforeseen or timing of cash flows from our subs or whatever it may be.
So as we go through the year, that’s why I say we’re not firm on any plans to use the ATM, but the ATM is there. And so we’ll continue to monitor it as we go through the year and we’ll firm up those plans as the year unfolds. I’ll pass the – ask the divestiture question over to David.
David Hutchens: Yes, obviously the focus that we have from a strategy perspective is executing that $25 billion capital plan. Now, of course, as fiduciaries, we’re always looking for opportunities to add value for our shareholders, so it’s on us to make sure that we’re looking at opportunities. But as Jocelyn mentioned, we’re not dependent on anything other than the funding plan that we laid out pretty clearly in the Investor Day back in the fall.
Linda Ezergailis: Thank you. And maybe just as a follow-up, a higher-level question. I don’t know if this is for Linda or maybe someone more honed in on the regulatory situation. The Chevron doctrine that’s been in place for 40 years approximately and addresses an ability for an agent’s – U.S. federal agency’s reasonable interpretation of any sort of ambiguous statutes is being challenged. What sort of impact would the discarding or removal of the Chevron doctrine potentially have on your business? And also, beyond that decision, we do have a U.S. election coming this fall, so just wondering how you’re thinking generally about FERC and any sort of other potential shifts in how your regulated businesses in the U.S. might have to adjust to any sort of new macro environment.
David Hutchens: That’s a great question, Linda, and it’s interesting because the Chevron doctrine has held precedence for deference to regulatory bodies for years and years and years and is an often cited precedent that obviously has been used by regulators too. I’ll say, coloring around those grey areas where legislation hasn’t really determined who has the responsibility to be able to make those calls. This has probably been a – well, it’s obviously been a conversation that’s been going on for decades, but it is interesting to hear the conversation. I don’t think in the long run it changes anything from our perspective. It’s I think what – the main purpose of this conversation is to understand or determine whether or not regulatory agencies are overstepping what – the – I will say the bounds that are put on by legislation that isn’t clear.
So, – and frankly, recently, because it is so hard to get legislation done in the U.S., it is left up to the regulatory bodies to kind of reach in and there is a fine line between regulation and policy. So I don’t see it having – it’s an interesting conversation. I don’t see it really having any impact on what we see today. I just think it may make it maybe a little more difficult to legislate by regulation on a going forward basis if it is challenged.
Linda Ezergailis: Thank you. And any other comments beyond this particular Supreme Court challenge to any sort of shift maybe in kind of regulatory, like what’s going on at FERC and where their priorities might be or any other commentary would be appreciated?
David Hutchens: Yes, I think, FERC, obviously down to three commissioners, is focused on a couple of things clearly. I think the planning and cost allocation, NOPR has been discussed in depth as being sort of frontline. It was great to see the interconnection queue. Final rule come out. And this is sort of the next thing in the queue from a bigger, broader transmission policy perspective. Due to the benefits, too, of having that closer to the front of the queue is that part of that NOPR is asking the question about whether or not to reinstate the federal Right of First Refusal for certain projects, which Order 1000 took away many years ago. So that’s part of that conversation as well. So we like to see that moving, and we hope it stays at the front of mind from a FERC perspective.
Linda Ezergailis: Thank you.
David Hutchens: Thanks, Linda.
Operator: We have our next question come from the line of Mark Jarvi with CIBC. Please go ahead.
Mark Jarvi: Thanks. Good morning everyone. Maybe, Jocelyn, if you could clarify just the comments around the reconsideration of the ROFR issue in Iowa. Did you say that it would be a parallel process to push through legislation? Maybe just kind of give us an update on where you think that effort is right now in terms of – right now legislation in Iowa.
David Hutchens: Well, yes, he asked you, Jocelyn.
Jocelyn Perry: Yes…
David Hutchens: Wait a minute. So, yes, thanks for the question. It is a parallel path. The reconsideration was filed in December and obviously in a parallel path that we’re trying to get new ROFR legislation through Iowa.
Mark Jarvi: And David, any sort of rough timelines on when you think that could be cabled and try to go to a vote?
David Hutchens: Not, don’t really have a good timeline for that. We’re obviously shooting for this legislative session, which is still newish. And so we’re trying to get it as quick as we can and to get it done and approved during this legislative session, which I think goes through April-ish timeframe.
Mark Jarvi: All senses at this point are that there is a political will to push that through and drive that forward at this point?
David Hutchens: Yes, so far we’re seeing good reception and hoping to get that pushed through.
Mark Jarvi: Okay. And then coming back to BC, what’s – with the year-end now done, just clarification on the equity injection with the equity thickness step-up, has that been determined and what is that amount that has to go in 2024?
Jocelyn Perry: Yes, Mark, that’s been determined. It was $300 million.
Mark Jarvi: So that’s a little bit less than you would have thought a couple months ago, is that right?
Jocelyn Perry: Yes, it was about what we thought. It may have been a little bit lower.
Mark Jarvi: Okay. And then just if you think broadly around that question around the Okanagan pipeline and gas needs and this transition around electrification, but obviously BC struggled with forest fires, wildfires, drought conditions, which has hampered their whole sub-verse of the generation market there. So what conversation goes on around sort of reliability and costability that the gas assets offer versus some of the pressures that the electric network might have faced over the last couple of years?
David Hutchens: Well, that depends on the jurisdiction. Obviously, in Arizona, we have natural gas now in our newest integrated resource plan for both Tucson Electric Power and UNS Electric, our two electric utilities there. There is – Alberta is a whole different conversation as well, recognizing the need and just looking and seeing a lot of additions of natural gas capacity from a generation standpoint coming on this year. And obviously, a lot of conversations in that jurisdiction at the – as a distribution-only company we’re sort of a bit on the sidelines on that. But in British Columbia, you don’t hear a whole lot of conversation around natural gas generation because they have so much hydro. So a lot – most of the conversation is like Site C expansion and around hydro and renewables at this point.
