Entergy Corp
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Entergy Corp
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Good morning. My name is Regina, and I will be your conference operator today. At this time, I would like to welcome everyone to Entergy's First Quarter 2023 Earnings Conference Call. [Operator Instructions].
I would now like to turn the call over to Bill Abler, Vice President of Investor Relations for Entergy Corporation.
Good morning, and thank you for joining us. We'll begin today with comments from Entergy's Chairman and CEO, Drew Marsh; and then Kimberly Fontan, our CFO, will review results. In an effort to accommodate everyone who has questions, we request that each person ask no more than 2 questions.
In today's call, management will make certain forward-looking statements. Actual results could differ materially from these forward-looking statements due to a number of factors, which are set forth in our earnings release, our slide presentation and our SEC filings. Entergy does not assume any obligation to update these forward-looking statements. Management will also discuss non-GAAP financial information. Reconciliations to the applicable GAAP measures are included in today's press release and slide presentation, both of which can be found on the Investor Relations section of our website.
And now I will turn the call over to Drew.
Thank you, Bill, and good morning, everyone. We had a very productive start to the year with meaningful progress on activities that support our near- and long-term objectives. Today, we are reporting first quarter adjusted earnings per share of $1.14. Mild weather affected these results, but we are prepared for this variability. As we have shown over the last several years, our FLEX program helped us achieve that very predictable results. We are on track for 2023 results in line with our guidance, and we remain well positioned to achieve our long-term 6% to 8% growth outlooks.
Our focus on creating sustainable value for our 4 key stakeholders, customers, employees, communities and owners is the foundation of our strategy. It's at the center of everything we do. Recently, JUST Capital and CNBC named Entergy to the JUST 100 list, which highlights companies that are doing the right thing for all their stakeholders. We are honored because our inclusion on this list is an acknowledgment that we are living up to our commitments.
Serving all our stakeholders starts with understanding what our customers need from us. To meet those needs, we are investing to improve reliability and resilience and significantly expand our clean energy footprint. This will not only help our current customers become more successful, but will also attract new customers. So far this year, we have installed or replaced over 400 transmission structures with new resilient designs, including critical river crossing lines. We also completed transmission interconnections for 2 new Entergy-owned renewable resources.
One example of a transmission project that will improve resilience and reliability is a recently completed projects in Southwest Louisiana, where we upgraded transmission lines rated to withstand 150-mile per hour winds, replaced older poles with resilient steel structures, installed new higher-capacity power lines and added automated switching capability to improve reliability.
In Southeast Louisiana and in Texas, we are building new substations and distribution power lines that will support residential and business growth in those areas and reduce stress on existing substations. In addition, we installed and replaced more than 5,000 wood distribution poles with newer, more resilient designs. Collectively, our team continues to focus on operational excellence to deliver stakeholder outcomes across all facets of our business.
We also continue to be a critical local partner, supporting strong economic development, working to bring new businesses, new jobs and new tax base to the communities we serve. As you know, we expect significant industrial sales growth over the next several years. While the broader market is contemplating recession concerns, our region's growth story remains intact. Key strategic value drivers continue to be supportive.
The LNG, ammonia and refining sectors are generally short on supply, and the deficit will likely not be meaningfully affected by a recession. Other sectors, such as ethylene, PVC, methanol and steel, may see some market pullback, but the Gulf Coast has the lowest cost producers. So plants in our service area should be the last to be curtailed. Meanwhile, the passage of the IRA is accelerating development in the clean energy transition space. We are seeing very strong interest in our service area, which has the potential to increase and extend our 6% long-term industrial sales growth rate as incentive rules are finalized and turned into financed projects.
One example of a potential project fueled by the IRA is the St. Charles Clean Fuels project, which is exploring whether to build a $4.6 billion blue ammonia production plant in St. Rose, Louisiana. The new facility would produce up to 8,000 metric tons per day of blue ammonia and would rely on carbon capture technology to sequester more than 90% of its carbon dioxide emissions.
Our underlying 6% industrial growth rate does not rely on these IRA tailwinds. And we continue to see a lot of activity in the traditional industrial segments we serve. There are some noteworthy developments in recent months, including Golden Triangle Polymers, which held its groundbreaking for a state-of-the-art polyethylene plant in Orange County, Texas. In addition, Sempra announced that the company reached its financial investment decision, and issued the final notice to proceed on Phase 1 of its Port Arthur LNG project.
A big part of meeting our customer sustainability needs is growing our clean energy footprint, and we continue to make progress on that objective. On Monday, we held our official groundbreaking for the Orange County Advanced Power Station in Texas, hosting Governor Abbott, 4 of 5 PUCT Commissioners and other state and local officials. That facility will ensure that we have modern and reliable infrastructure to support existing customers and the rapidly growing customer base in our Southeast Texas region.
We will utilize turbine technology and a plant layout that can support dual fuel capability with hydrogen in the future. The optionality helps ensure the plant's long-term viability and creates improved energy security and operational flexibility for our customers. We also continue to make progress on our objective to expand our renewables capacity to meet customer needs. Since our last call, Entergy Arkansas and Entergy Louisiana concluded evaluations of their 2022 renewable RFPs. Participation was robust, and we are in negotiations for approximately 2,300 megawatts.
Turning to affordability. It remains a core tenet in our pursuit of greater sustainability and reliability for customers. To help manage bill effects of customer-centric investments, we continue to aggressively pursue customer sales growth, disciplined cost management and federal support to offset costs. Natural gas prices have come down significantly. And coupled with a mild winter, that's further good news for customer bills. Our latest estimates for residential bill trajectories, including updated gas have improved.
For the system, we are now seeing a 3-year annual growth rate of less than 1% from 2022 through 2025. That's roughly half the level we were expecting a few months ago. In the quarter, we made regulatory -- meaningful regulatory progress against our objectives. Entergy Texas has reached settlement on all material issues with parties in its base rate case, and we expect to file the settlement with the PUCT in the next few weeks. Entergy Mississippi filed its annual formula rate plan in March. Mississippi's efficient mechanism supports continued customer-centric investments and supports our financial outlook. Interim rates became effective on April 1.
Entergy Louisiana's formula rate plan will expire after this year's filing. We are evaluating options to renew the current FRP, and we're also preparing for a potential rate case filing, which would be submitted this summer. As we've laid out, Entergy Louisiana is investing significant capital to support our customers' growth and their demands for greater resilience and clean energy. This growth is critical for Louisiana and its local communities.
We need to ensure that our rate constructs provide the opportunity for fair and timely recovery, which will allow us to effectively source the capital while maintaining utility credits. Either an FRP renewal or rate case path should allow enough time for rates to be effective in September 2024, which would keep us on our normal cadence. If we file a rate case, we will request a new FRP starting with the 2025 filing year.
Entergy Louisiana also filed a request to streamline the procurement and approval processes for up to 3 gigawatts of solar resources. This is in addition to the nearly 2.5 gigawatts from previous or ongoing RFPs. If the new processes are approved, we can bring additional renewables to construction faster and at a lower cost and risk, materially improving our ability to meet our customers' accelerating demands for clean energy.
For our accelerated resilience and grid hardening filings, Entergy Louisiana received a procedural schedule in its docket. Next up is the commission's engineering report and testimony to be filed in August. Hearings are scheduled in January of next year. However, there is the potential to receive a decision this year through a settlement with parties, and that remains a possibility with broad stakeholder alignment on the need for more resilient investments. In a separate but important docket, the LPSC Staff outlined a process and an evaluation procedure for utilities in Louisiana to follow, which creates a solid road map for Entergy Louisiana's resilience investment.
Entergy New Orleans filed its updated resilience plan with the City Council. The $1 billion 10-year plan reflects significant stakeholder input. Like Louisiana, New Orleans is requesting approval for the first 5 years of the program, and we are targeting a decision from the council by year-end.
In Texas, the Electric Infrastructure Resiliency Act has been proposed in both the State House and Senate. The bill, if passed, would require the commission to act within 180 days of utilities filing a resiliency plan. Certain prudently incurred costs would be recovered through a variety of mechanisms. We will continue to work with our regulators across all aspects of our business to create value for our customers and other key stakeholders. And you can find additional details on our regulatory proceedings in the appendix of our webcast presentation.
In March, our service area experienced tornadoes in Arkansas and Mississippi. The damage to our system included distribution poles, wires spans, transformers and one substation. We replaced damaged equipment with newer, more resilient assets rated to our latest standards. The restoration is completed quickly and safely with 0 injuries. And for that, I am extremely grateful to our teams. In addition to restoration, we responded quickly to provide community support. Entergy shareholders committed $150,000 to the American Red Cross to provide shelter, food, water, mental health counseling and other services to the households impacted by the tornadoes.
In addition, more than 150 Entergy employees came into the affected region and volunteered their time by assisting with cleanup, providing meals, organizing supply drives and staffing information booth to once again prove our employees unfaltering commitment to our customers and communities when they need it most.
Before concluding, I would like to note that Entergy Mississippi is celebrating its 100th anniversary. That's a century of serving its customers and communities. To commemorate this milestone, Entergy Mississippi donated with $100,000 to Extra Table, a Mississippi-based food bank, to combat food and security in Mississippi. That's $1,000 for every year of operations. In addition, Entergy volunteers packed 2,500 meal kits. This is the first event of a multiphase program that will ultimately provide 100,000 meals. Giving back to communities through philanthropy, volunteerism and advocacy is integral to Entergy's living its vision statement of We Power Life.
We've had a productive start to 2023. We are focused on successfully delivering value for our key stakeholders, and we will continue to successfully achieve the milestones that keep us on track to deliver steady, predictable earnings and dividend growth. To do this, we are working to improve operational and regulatory outcomes, support our customers' industrial growth and economic development in our region, invest in renewables, clean energy and resilient acceleration to support our customers' demand and execute with financial discipline to strengthen our balance sheet and become more competitive.
I'll now turn the call over to Kimberly, who will review our financial results for the quarter.
Thank you, Drew. Good morning, everyone. Our first quarter adjusted earnings per share was $1.14. Results included a very mild weather, which reduced earnings by an estimated $0.22. We incorporate conservative assumptions into our planning process and have a portfolio of FLEX levers to mitigate the impacts. The fundamentals of our utility growth remains strong. And despite the first quarter weather, we remain squarely on track to achieve our financial objectives for 2023.
Before I review quarterly results, I'd like to highlight a couple of items. First, this quarter's results included the effects of storm securitization at Entergy Louisiana, including $76 million of benefits for customers. These items were considered adjustments and are excluded from adjusted earnings. Additional details are provided in our earnings release. Second, beginning in 2023, as a result of the successful exit from the merchant nuclear business, EWC is no longer a reporting segment and any remaining financial activity from that business is now included in Parent & Other.
You'll see the first quarter variances laid out on Slide 4. The quarter results reflected the effects of investments that are benefiting our customers. This includes regulatory actions as well as depreciation expense, other taxes and interest expense. Excluding weather, retail sales were higher, driven by industrial sales growth of 2%. That growth came largely from new and expansion customers, particularly in the primary metals and petrochemicals industries. This was partially offset by lower sales to Cogent customers as Cogent sales were particularly strong in 2022.
Slides 5 and 6 show key metrics for our largest industrial segments. As Drew mentioned, these metrics remain very supportive and are consistent with the growth that we are seeing. They also give us confidence in our industrial sales growth outlook.
Moving to Slide 7. Operating cash flow for the quarter was $960 million, $422 million higher than last year. Higher utility customer receipts, lower noncapital storm spending and lower pension contributions were the largest drivers. The effects of the EWC wind down provided a partial offset.
Credit and liquidity are summarized on Slide 8. During the quarter, Entergy Louisiana received $1.5 billion from storm securitization. This completes our securitization. Entergy Louisiana plans to reduce long-term debt as issuances mature. We have made significant progress on collecting deferred fuel balances, which came down more than $400 million in the quarter. This continues to improve our credit metrics. Our net liquidity remained strong at $5.7 billion, including $406 million of storm escrows.
Looking at Slide 9, our equity needs are unchanged. Only $130 million remains through 2024, and we plan to use the ATM program to meet this need.
As shown on Slide 10, we are affirming our guidance and longer-term adjusted EPS outlook. Weather has been a headwind to start the year, but we've also had a few tailwinds to our plan. Our first quarter sales mix resulted in slightly higher margins, and we see some favorability in several items that, in aggregate, are providing meaningful relief. After taking all of this into consideration, we are flexing O&M by $0.10, which keeps us comfortably in our guidance range. The bottom line is that we have a solid plan with good visibility, and we will continue to execute on the deliverables to achieve steady, predictable growth.
And now the Entergy team is available to answer questions.
[Operator Instructions]. Our first question comes from the line of Shahriar Pourreza with Guggenheim Partners.
So just real quick on financing. You guys obviously have a CapEx plan through '25, but financing is still based on a '24 plan. When do you sort of anticipate rolling that forward? And what can we anticipate in terms of capital allocation, especially in light of the current capital market conditions? Is asset optimization still an option you guys are kind of looking at?
Thanks, Shahriar, for that question. As it relates to our capital plan, as you know, we have $16 billion through '23 through '25, and we've provided the financing for that, which includes a little bit that's left in '24. We have talked about -- the last time we talked about '25 was at Analyst Day, where we gave a number for '25 and '26. And I would expect as we turn the corner on '24, we would be looking at that financing more specifically. As it relates to your asset optimization question, certainly, we don't have anything to know here. But as you know, we would pursue that if it met our 3 basic grading criteria around. Is it executable? Does it distract? And does it create value? But certainly, to the extent that something met that criteria, we would look at it.
Got it. And then just on some of your recent solar RFPs and kind of announcement. How is that, I guess, kind of tracking versus your plan for up to 13 gigs and what portion of the new solar is being sort of deployed to support retirement versus new load? And just that initial ownership share versus PPA has always been kind of skewed to contracts? Do you anticipate that's going to change over time?
Yes, Shahriar, this is Drew. And it has been skewed and that's not where we want to be, frankly. So we are working hard to improve our self-build capabilities and leverage our economies of scale, find more financial discipline in the packages that we're putting together in those RFP processes so that we can improve. And we do believe that, that will happen.
But you're right, we haven't been hitting the mark, and that's important because it is creating some -- it's taking up some of the room in our balance sheet and limiting our operational and strategic flexibility in the long term. So we want to make sure that we get up to that number, and we're still working towards it.
Your next question comes from the line of Durgesh Chopra with Evercore ISI.
I had two questions, both on sort of the resiliency filings. Maybe first part of that question, can you just give us any initial stakeholder feedback that you may have gotten in Louisiana and New Orleans, the 2 filings that you've made? And second, Drew, in your prepared remarks, you mentioned about this separate docket in Louisiana. Maybe a little bit more color there. Do you have to kind of use that docket for securing the approval in Louisiana? Or just maybe any other color there?
It's Rod. Thanks for the question. Louisiana, in terms of stakeholder feedback, I think part of the answer is in the question that you asked. The fact that the staff submitted proposed rule-making around resiliency filings for all utilities in Louisiana, we view as reflective of a constructive stakeholder engagement strategy for the company over the course of the last 6 to 9 months in Louisiana. Because the proposed rule-making actually puts us in a position to be very much aligned given the strategy that we laid out for the commission, both in Louisiana and in New Orleans. And so the feedback has been constructive.
So our expectation is, as you think about the procedural schedule that Louisiana laid out, they're backcasting from a January 2024 hearing date. Their procedural schedule backs up from that date to give us an opportunity to perhaps settle with stakeholders to accelerate agreement around the Louisiana decision-making on resiliency. So we view that as a net positive.
New Orleans tracks Louisiana in that, we have clarity from the City Council on our initial proposal, which was $1.5 billion through that stakeholder engagement process. We narrowed down the grouping of projects to about $1 billion of the $1.5 billion. And that $500 million that didn't make the cut wasn't about a lack of agreement on the need for the projects, they just tracked on a different path outside of the accelerated resilience.
So in both Louisiana and New Orleans, we view the stakeholder engagement feedback being positive and constructive, and the existence of procedural schedules in both the LPSC and the New Orleans City Council is consistent with our financial plan.
This is Drew. I want to add to what Rod was saying, just to make sure you caught it at the beginning of his comment, he actually answered the second of your question at the beginning on the second docket. And that second docket does actually create an ability for us to do the math on how the benefits and the costs should work. And specifically, it allows the economics of customer outages to be part of the conversation. And so there's a few mechanisms that they create for that. But that's an important piece of that framework that the staff established.
I'll also -- thanks, Drew. I'll also add that in New Orleans as we think about the $1.5 billion that we initially filed and the $1 billion sort of compliance filing after the feedback process, it's roughly 2/3 of the proposed CapEx and 80% of the customer benefits, just going with the $1 billion versus the $1.5 billion in the accelerated docket process. So again, we view the feedback as constructive in both Louisiana and the City of New Orleans today.
Your next question comes from the line of Julien Dumoulin-Smith with Bank of America.
So perhaps, just pivoting to theory here and the pending complaints. Is it completely dependent on FERC? Or are you able to facilitate progress at FERC in any specific way? I just want to come back to that back and forth in just the procedural elements a little bit more specifically here, if you will. And then, if I can, as a follow-up, are you still having settlement conversations with perhaps any of the parties considering maybe some of the ambiguities here?
I think the short answer to both of the frames of your question is, settlement discussions will be aided by clarity from the FERC that we are awaiting with regard to the sale leaseback and the uncertain tax position ruling, as you recall from the December ruling and the procedural order out in this past February. So yes, there are ongoing conversations and settlement on all of the ancillary cases, but clarity around where the FERC sits on those 2 issues will go along the way towards setting the path for our -- our path forward on settlement. There's no -- yes, go ahead. I'm sorry.
No, I'm sorry. And it seems like it's dependent on them, right? There's no ability to facilitate progress at FERC or otherwise enable it in a separate parallel docket as you alluded to a second ago on [indiscernible]?
I think that's a fair assessment, just given the positions that certain of the stakeholders have taken around their reaction to the December order. Clarity from the FERC will clear the lanes for ongoing discussions. There's also a timing element where we expect the FERC to act sooner rather than later in order to maintain jurisdiction vis-à-vis the Fifth Circuit and others. So we're expecting -- we don't have a date, but we are expecting FERC to act sooner to get ahead of what might be the appeals process if left unresolved.
Got it. Excellent. And then if you can -- on '23, just super quickly on the guidance. I know, Kim, I think you said in a second ago about the $0.22 and the $0.10 here of O&M. How much further flex is there in the plan to the extent to which obviously other items materialize, and/or if you can elaborate a little bit more on just the components there in?
Thanks, Julien. It's early in the year. So we certainly have good line of sight on our ability to manage that through the rest of the year. There is some additional puts and takes that we would manage through depending on what happens. Obviously, if the weather is mild during the summer, we'd have to work through that. If it comes in more normal or hotter, then there may be opportunities to flex up.
For some specifics, certainly, we talked about last year that in 2022, the higher O&M was tied to higher volumes and we flex stuff, which helps us to derisk '23, and we're able to take advantage of some of that here. And then we've seen some favorability, as you probably saw in the materials around volumes in residential and commercials, and that may give us continued opportunity throughout the year if that continues to persist. The other area I would point out is interest expense, and we've been able to manage through some potential upside there as it relates to timing of debt issuances, for example.
Our next question comes from the line of David Arcaro with Morgan Stanley.
A little bit of a follow-up on the last question. I was curious for the utility O&M targets for the year, you notched that up to $0.70 in terms of the savings. But I was curious, it was only about $0.03 kind of a help in the first quarter. Are there any underlying challenges that you've hit or inflationary pressures or anything like that, that make it more difficult to achieve the O&M savings for the year? Or is it more just kind of a timing issue versus -- on a year-over-year comparison?
Thanks, David. You're right. For the first quarter, we were down about $0.03, but our O&M doesn't occur ratably over the year. It's really tied, as I said, particularly last year, we ramped up with the higher volumes in second and third quarter. So I would expect to see assuming normal weather, a much more spread versus last year in O&M in that second, third and fourth quarter.
Okay. Got you. That's helpful. And then I was just wondering, are there any legislative bills in Texas that might be meaningful for your business as we get closer to the end of the session in the state for next month?
Yes. There are a number of items in consideration. The one that we're certainly paying attention to has to do with resiliency filings from not just Entergy, but other utilities. There's 5 weeks left. So there -- the good thing is that it's been progressing nicely. The significant attribute that we're looking for in coming out of those resiliency filings would be the types of precedents that were set in Texas, where when we were making AMI filings in Texas, we were able to take assets that still had useful life out of service and replace them with the newer, more modern and in this case, more resilient assets and still be able to account for those undepreciated assets.
So we're tracking the progress of those various pieces of legislation to ensure that we have the appropriate flexibility with the commission to facilitate our resiliency and reliability investments in Texas. So it's moving along. Stakeholder engagement has been strong and quite active, but 5 weeks or so left in the session. So we'll continue to go at it.
[Operator Instructions]. Our next question comes from the line of Ross Fowler with UBS.
Just one from me around -- or two from me. But the first one is on Slide 38, so following up a Julien's question. So if I kind of just look through what you're showing here, I see sort of $0.10 of the O&M and then sort of corporate being down $0.05 kind of offsets the $0.05 a better sales mix. So versus the $0.22 of weather, $0.10 of sort of offsets. And Kim, to sort of get into your answer, I think what you were saying there is there's more offsets to come to offset the balance of that $0.12 or maybe some of that's in that slightly favorable impact around other income and lower interest expense to sort of get back to the midpoint? Or absent for the mitigation, are you kind of pointing to the low end of the range for '23?
Yes, Ross, I think you're right in that there are small opinions in a number of categories beyond what you went through there. So you're right, a $0.10 in O&M. You've got the $0.5 and other and the weather volume there is about $0.05. And we saw that mix in the first quarter. And then you will see probably not specifically in the side, but just on a -- throughout the balance of the income statement, pennies here and there that balance the rest out.
Yes. And this -- Ross, it's Drew. So while we would certainly concede that $0.22 brings us lower than the midpoint, it's early in the year, and we wouldn't say that that's where we are at this point. We're just targeting the midpoint, and we expect to do better than that by the end of the year.
Got it. That's very clear. And then just maybe contextualize for me, you're showing 2% industrial growth in the quarter year-over-year. And Drew, you kind of went through this in some of the prepared remarks, but maybe give us a little bit more contextualization of your sort of 6% long-term aspiration versus what you're currently seeing?
Yes, I'll take that. So we've seen -- we talk about the drivers, and we have a couple of slides in there about the drivers. And as we've said for a number of years now, there's a lot of advantages to the Gulf Coast, and that's access to global and national markets and the available energy infrastructure, low energy prices, supportive communities, available workforce. All of that has been driving investment domestically towards the Gulf Coast and frankly, our service territory all the way up the Mississippi River.
Now you've got the broken global supply chains, geopolitical uncertainty. You've got the tailwinds for the IRA. Before you even get to the IRA, we've seen a lot of onshoring and that's basically what our 6% is based on. And we see a lot of investment. We have -- the 6% is a probability-weighted assessment of where we think it will come out. That takes into consideration. Some projects don't always make it to the finish line. Some projects are a little delayed, all that kind of stuff. If all of it landed, it could be significantly larger than 6%, but that's not our planning assumption at this point.
[Indiscernible] the tailwinds of the IRA and it could get bigger. The rules are still a bit uncertain associated with that, particularly around hydrogen, green hydrogen in particular. But we are seeing an awful lot of interest in the Gulf Coast area to try and take advantage of, frankly, the existing infrastructure that's already there. The hydrogen infrastructure, for example, we have production, we have consumption, we have transportation, we have storage and everything that you need to move hydrogen. And we have a lot of people that are coming to the Gulf Coast to try and take advantage of that existing infrastructure. I mean it is effectively a hydrogen hub already.
And similarly, we also have CO2 pipelines and CO2 consumption, CO2 production. And so carbon capture is going to be the game. There is existing infrastructure for that as well. And so folks are looking at all of that stuff and thinking about how to expand on that opportunity in the long term. And so we see a lot of exciting investment opportunities, in fact, when we were in Texas on Monday for the groundbreaking for Orange County. There was a lot of discussion about hydrogen, about carbon capture with state officials in Texas. They are excited about it. They're excited about the growth opportunities that they are seeing all of it as well, and they are very supportive of us having dispatchable generation to make sure that we can support that potential investment that we believe is on its way. So that's frankly what we're looking at. It's very exciting and a lot of opportunity ahead of us.
That's great. And of course, we'll be watching the potential for EPA plant rules around carbon capture. But for now, I'll jump back in the queue.
Your final question will come from the line of Steven Fleishman with Wolfe Research.
Just wanted to follow up on the question related to Siri, where, I think, Rod, you mentioned a timing element that FERC needs that before they lose jurisdiction. Could you give us a sense of what that time line is or limit?
Yes, I don't have the actual procedural schedule in front of me, Steve, but it's my appreciation that the Fifth Circuit process that includes or -- actually all of our utility jurisdictions. There's an appeals process at the Fifth Circuit that would impact FERC's ability to provide clarity around that December 23 decision.
And so it's our appreciation from the lawyers that the FERC has an interest in resolving any lack of clarity in avoiding having to create a conflict jurisdictionally between the Fifth Circuits answer to the appeal from the parties and their ability to drive their respective order. And so that's what you hear in the hedge of sooner rather than later because we don't know exactly what that time frame is, but we recognize that, objectively, it is an issue.
Okay. And then, I guess, a question for Drew, just things have quieted down a lot once the securitization was approved and fuel prices have come down and the like. Could you just give a latest sense of relationships with the Louisiana Commission and do they kind of have appreciation of the volatility that was created around, stuff early in the year? And yes, any color there would be helpful.
Sure, Steve. I'll start, but then I'll kick it to Rod, who has the subject matter expertise in that particular area. But it is -- you're right, it is a little bit more constructive right now compared to where it was last fall. I know you had to -- thinking back to last fall, it's easy to forget that we had an election going on. They were contested elections. There was a lot of outside money in those elections, which were putting additional energy into the political process, and it was coming on the heels of a hot summer with escalating gas prices. And that was all just coming to a point as our securitization was showing up there.
We believe that we still continue to have strong relationships in Louisiana and at all levels of the government and including the commission. And so we endeavor to work closely with them on an ongoing basis. But that's still -- we're not taking that for granted. That is something that we are very much focused on. We know that our commissioners are very focused on customer outcomes. And so we are as well. And so I'll turn it over to Rod to talk a little bit more.
Yes. And I think, Steve, your preface was on point. The fact that gas prices have come down and we have aided in providing relief to customers, and there's been some time since the election that's given us an opportunity to reengage with commissioners around our customer-centric strategy, I think it's proven very helpful.
I will note that our most recent engagement with the commission was around vote on the gas business rate case. That was a big deal. The prudency of our Lake Charles -- our Lake Charles Power Station, along with the gas rate case was all 5 0 . And it is not insignificant that the proposed rulemaking from this path with regard to resiliency. That too was the result of the intentional work in part that we have -- we've done in engaging with the commission and our other stakeholders, especially the customers.
So look, in response to the noise coming out of the elections and the end of the year, we've certainly ramped up our engagement processes to make sure that our commission and staff from related stakeholders are informed. But also, I want to be explicit in saying that the -- the fact that we have a new commissioner in Louisiana for us represents a new commission. Anytime there's a new addition to the commission, it's an opportunity for us to reassess, reset and reengage.
And we've been quite deliberate about doing that for the purpose of keeping alignment with the commission because we have a -- and you know this, we have a really aggressive regulatory agenda given all of the merit of customer-centric opportunities and investments we have in Louisiana and the growth in Louisiana is going to put a lot of pressure on the commission. And our engagement process is geared to help make their lives easier as we try to solve our customers' problems. But we get it, and it will be ongoing. It is not a thing where we check the box and say, oh, we have finished the work. The stakeholder engagement process is 24/7/365, Steve.
We have no further questions at this time. Mr. Abler, I will turn the call back over to you.
Thank you, Regina, and thanks to everyone for participating this morning. Our quarterly report on Form 10-Q is due to the SEC on May 10, and provides more details and disclosures about our financial statements. Events that occur prior to the date of our 10-Q filing that provide additional evidence of conditions that existed at the date of the balance sheet would be reflected in our financial statements in accordance with generally accepted accounting principles.
Also as a reminder, we maintain a web page as part of Entergy's Investor Relations website called Regulatory and Other Information, which provides key updates of regulatory proceedings and important milestones on our strategic execution. While some of this information may be considered material information, you should not rely exclusively on this page for all relevant company information. And this concludes our call. Thank you very much.