With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

Fortune 500

Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Industries included in the sector are mining, oil and gas exploration and services, pipelines, refining, and utilities.

Fortune Sector Leaders: Energy

The Fortune 500, in its 70th year in 2024, ranks the biggest U.S. companies by revenue.

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

This year’s Fortune 500 marks the 68th running of the list.

This year’s Fortune 500 marks the 67th running of the list.

F500-2021-318-PSEG

The diversified energy company provides electricity and gas to more than 5 million customers in New Jersey and New York.

This year's Fortune 500 marks the 66th running of the list.

F500 2020 317 Public Service Enterprise Group

The New Jersey-based energy company provides electricity and gas to portions of New Jersey and New York and is one of the 10 largest electric companies in the U.S.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

Here are the World's Most Admired Companies for 2017 as ranked in their industries. See who made the list.

World's Most Admired Companies

This year's Fortune 500 marks the 63rd running of the list.

This year's Fortune 500 marks the 62nd running of the list.

This year's Fortune 500 marks the 61st running of the list. Wal-Mart claims the top spot again. See who made the list.

Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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The Public Service Enterprise Group has been a cornerstone in providing reliable electric and natural gas services for more than a century. Its principal subsidiaries include Public Service Electric and Gas Company (PSE&amp;G), New Jersey's largest provider of electric and gas services; PSEG Power, which manages energy-supply operations; and PSEG Long Island, responsible for operating the electric transmission and distribution system for the Long Island Power Authority. Serving millions of customers across New Jersey and Long Island, PSEG is committed to delivering safe, affordable, and sustainable energy solutions.

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Public Service Enterprise Group (PEG): Company Profile, Stock Price, News, Rankings

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Public Service Enterprise Group

public service enterprise group

Ladies and gentlemen, thank you for standing by. My name is Rob, I am your event operator today. I'd like to welcome everyone to today's conference, Public Service Enterprise Group's fourth quarter and full year 2025 earnings conference call and webcast. At this time, all participants will be in listen-only mode. Later, we'll conduct a question and answer session for members of the financial community. At that time, if you have a question, you'll need to press the star and 1 on your telephone keypad. To withdraw your question, press star and then 2. If anyone should require operator assistance during the conference, please press star 0 from your telephone keypad.

As a reminder, today's conference is being recorded today, February 26, 2026, and will be available for replay as an audio webcast on PSEG's Investor Relations website at https://investor.pseg.com. I would now like to turn the call over to Carlotta Chan. Please go ahead.

Good morning, and welcome to PSEG's fourth quarter and full year 2025 earnings presentation. On today's call are Ralph LaRossa, Chair, President, and CEO, and Dan Cregg, Executive Vice President and CFO. The press release, attachments, and slides for today's discussion are posted on our IR website at investor.pseg.com, and our 10-K will be filed later today. PSEG's earnings release and other matters discussed during today's call contain forward-looking statements and estimates that are subject to various risks and uncertainties. We will also discuss non-GAAP operating earnings, which differs from net income, as reported in accordance with generally accepted accounting principles or GAAP in the United States. We include reconciliations of our non-GAAP financial measures and a disclaimer regarding forward-looking statements on our IR website and in today's material. Following our prepared remarks, we will conduct a 30-minute question and answer session.

I will now turn the call over to Ralph LaRossa.

Thank you, Carlotta, and thank you all for joining us to review PSEG's fourth quarter and full year 2025 financial and operating results, our financial outlook for the year ahead, and our long-term projections through 2030. Before I dive in, I'd like to thank our employees, who once again this past week, prepared and restored our system from yet another intense combination of winter weather that brought over 2ft of heavy snow, single-digit temperatures, and 60-mile-per-hour winds to our service areas in New Jersey and Long Island. I can't say enough about our crew's dedication throughout this entire winter season, working in freezing conditions to keep the lights on and our customers warm.

Now, starting with our financial results, PSEG reported net income of $0.63 per share for the fourth quarter and $4.22 per share for the full year of 2025. Our non-GAAP operating earnings were $0.72 per share for the fourth quarter and $4.05 per share for the full year of 2025. Also, earlier today, we announced our dividend declaration for the first quarter of 2026, setting the indicative annual rate at $2.68 per share. This is a $0.16 per share increase, an increase of approximately 6% over last year's dividend and higher than last year's increase of $0.12 per share, all reinforced by our confidence in our long-term projections.

Starting with operations, on February 7, 2026, we hit a seasonal gas sendout peak when temperatures dipped below 10 degrees Fahrenheit, registering the fifth-highest sendout in our history. During that same cold snap, PSEG's appliance service business responded to nearly 2,000 no heat calls per day, compared to an average of 600 calls on a typical winter day. Our electrical systems also performed well, with a comparatively small group of customers affected, and PSEG was able to restore service to virtually all customers within 24 hours. Beyond the storm seen in 2026 to date, PSEG's full year results for 2025 were achieved while facing multiple severe storms and extreme weather events throughout the year that stressed our electric and gas systems. PSEG's response, guided by our operational excellence model, achieved excellent results in safety, reliability, and customer satisfaction measures.

I'm also very proud of the work PSEG is doing in support of New Jersey's efforts to minimize utility bill increases. Last July, we implemented several summer relief initiatives in cooperation with New Jersey regulators to help our customers manage the impact of PJM-related electric supply costs that PSEG passes through to customers. The latest example of our efforts occurred on February first, when PSEG held its residential gas rate flat for the remainder of the winter 2025 through 2026 heating season. Extending the stability of our gas rates further highlights PSEG's favorable residential gas bill profile, which is not only the lowest cost in the state, but also the lowest in the region. There's more good news to report on the customer front.

Earlier this month, the New Jersey Board of Public Utilities approved the results of the latest electric supply auction, known as the Basic Generation Service auction, or BGS, which will result in a 1.8% reduction in the average monthly bill for PSEG residential electric customers starting June 1st, when seasonal electric use is at its highest. Over the next several months, we will introduce even more ways to help our customers manage and save on their utility bills, with increased budget billing education, new time of use rates, and more energy efficiency solutions. PSE&G also received approval to extend its three year GSMP III program, which will continue our efforts to reduce methane emissions of powerful greenhouse gas. We note that our cumulative progress from these programs has reduced our methane emissions by over 30% system-wide from 2018 levels.

Recent winter weather has validated how effective our gas system investments have been by reducing both the number of pipe breaks and low pressure issues compared to similar low temperature events in the past. Our operating performance continues to be a positive differentiator in the state and the region. PSE&G received the 2025 ReliabilityOne Awards for outstanding system resiliency, outstanding customer engagement, and for the 24th year in a row, outstanding reliability performance in the Mid-Atlantic region. PSE&G ranked 1 in customer satisfaction among large electric utilities in the East region, according to the J.D. Power 2025 U.S. Electric Utility Residential Customer Satisfaction Study, marking the 4th consecutive year PSE&G has earned the top position in this segment. PSEG Long Island, yes, PSEG Long Island, ranked 1 in customer satisfaction among large electric utilities in the East region, according to the J.D. Power.

2025 U.S. Electric Utility Business Customer Satisfaction Study, capping an 11-year rise from the bottom of the rankings since PSEG Long Island took over the operation of the electric grid on Long Island. By the way, PSE&G was number 2 in that same study. Finally, PSEG Long Island was awarded a 5-year contract extension to continue as the electric transmission and distribution operator on Long Island and the Rockaways through 2030. We look forward to continuing our constructive partnership with LIPA that has enabled us to become the best performing overhead electric service provider in New York State, and like PSE&G in New Jersey, a top performer nationally for reliability and safety. 2025 was a successful year for our company, both operationally and financially.

PSE&G executed on its capital plan, investing approximately $1 billion in the fourth quarter and approximately $3.7 billion in total for the year in regulated capital spend. On the generating side, PSEG Nuclear posted a 91.2% capacity factor for the full year, producing approximately 30.9 terawatt hours of 24/7 carbon-free baseload power for the grid, including during the intense June 2025 heatwave when New Jersey needed it most. PSEG's non-GAAP operating earnings for 2025 were at the high end of our narrowed guidance range of $4.00-$4.06 per share, extending management's track record of delivering results that either met or exceeded our earnings guidance for the 21st consecutive year.

Turning to our outlook for 2026, first, we initiated a non-GAAP operating earnings guidance in the range of $4.28 to $4.40 per share, an increase at the midpoint of 7% over 2025 results. Our 2026 guidance is based on our investment program at PSE&G and expected nuclear output, realizing market prices that exceed the nuclear PTC threshold. We are approximately 95% hedged for the remainder of 2026. We will also keep to our long-standing practice of stringent cost control and continuous improvement to support affordability and benefit our customers. Second, we updated PSEG's capital program to $24 billion-$28 billion for the 2026-2030 period, with over 90% focused on regulated investments.

Regulated capital spending is forecasted in a range of $22.5 billion-$25.5 billion and supports a rate-based CAGR of 6%-7.5% over the same period. Our solid balance of the sheet supports execution of this robust five-year capital plan, still without the need to issue equity or sell assets. With these updates, we are raising PSEG's long-term non-GAAP earnings growth outlook to 6%-8% through 2030. This higher growth rate is supported by our best-in-class utility operations, executing on a customer-focused infrastructure modernization and energy efficiency investment programs. This regulated growth is supported by nuclear generation ownership, a significant cash flow generator, and therefore a differentiator among our peers.

Potential growth beyond our forecasted 6%-8% CAGR range could be achieved through opportunities to contract existing and additional generating output and through incremental regulated capital investments. The supply-demand dynamic we are seeing in New Jersey has prompted executive orders to be issued to explore supply options, including the development of an additional 3,000 megawatts of community solar and battery storage. We have been cooperatively working with policymakers since last November, and we look to help New Jersey achieve the high priority goals of these executive orders, which include the exploration of regulatory reform.... The executive orders also direct the BPU to provide for residential universal bill credits to again offset electricity supply rate increases. We look forward to constructive dialogue with the BPU on these issues.

Now, turning to the legislative front, in the past few days, a bill was reintroduced in the state legislature to establish a new natural gas power plant procurement program at the BPU, and this incentivizes the development of new natural gas power plants in the state. This gas bill pairs with an earlier bill that establishes a new nuclear procurement program, also within the BPU, that was introduced at the start of this legislative session. We look forward to working with policymakers to advance energy strategies and resources that secure affordable, reliable, and diverse energy supplies and support legislation that would increase competition for generation supply should New Jersey decide to pursue new in-state generation. As we have previously mentioned, we are well-positioned to help meet that need.

We have sites with grid connection capability and pipeline supplies, as well as the in-house expertise to build new supply here in New Jersey with prevailing wage labor. I will now turn the call over to Dan, who will walk you through our 2025 financial results and the outlook for 2026, and then rejoin the call for Q&A.

Thank you, Ralph. Good morning, everyone. PSEG reported net income of $4.22 per share for the full year of 2025, compared to net income of $3.54 per share for 2024. Non-GAAP operating earnings for the full year of 2025 were $4.05 per share, compared to $3.68 per share for 2024. For the fourth quarter of 2025, net income was $0.63 per share, compared to $0.57 per share in 2024, and non-GAAP operating earnings were $0.72 per share in the fourth quarter of 2025, compared to $0.84 per share in 2024. Slides 8 and 10 detail the contribution to non-GAAP operating earnings per share by business segment for the fourth quarter and full year of 2025.

Slides 9 and 11 contain waterfall charts that take you through the net changes for the quarter-over-quarter and full year periods in non-GAAP operating earnings per share by major business. Starting with PSE&G, which reported fourth quarter net income and non-GAAP operating earnings of $352 million for 2025, compared to $378 million in 2024. For the full year, PSE&G had net income and non-GAAP operating earnings of $1.75 billion in 2025, compared to $1.55 billion in 2024. Utilities results for the full year were driven by the implementation of new electric and gas-based distribution rates that took effect in mid-October 2024 to recover a return of and on previous capital investments, totaling more than $3 billion and higher working capital balances.

Compared to the fourth quarter of 2024, distribution margin increased by $0.07 per share, mostly reflecting incremental gas margin from the third quarter GSMP2 roll-in, an increase in the number of customers, and higher gas demand. Higher investment in energy efficiency also contributed to distribution margin in the quarter. On the expense side, distribution O&M increased $0.04 per share compared to the fourth quarter of 2024, primarily due to higher reserves and operational costs. Depreciation and interest expense rose by $0.02 per share compared to the fourth quarter of 2024, reflecting higher levels of depreciable plant investment and long-term debt at higher interest rates. Lastly, distribution-related taxes were $0.05 per share higher due to plant-related taxes and lower write-offs related to bad debt compared to 2024.

Weather during the fourth quarter, as measured by heating degree days, was 9% colder than normal and 23% colder than the fourth quarter of 2024. As a reminder, the Conservation Incentive Program, or CIP mechanism, decouples weather and other economic sales variances from a significant portion of our distribution margin, all while helping PSE&G promote the widespread adoption of energy conservation, including energy efficiency and solar programs. Under the CIP, the number of electric and gas customers drives margin. The residential customer growth for both segments was approximately 1% in 2025. On the capital front, as Ralph mentioned, PSE&G invested approximately $1 billion during the fourth quarter. For the full year of 2025, our capital spending totaled approximately $3.7 billion, with continued investments in infrastructure modernization, energy efficiency, and supporting growing customer demand.

For 2026, our planned capital investment program for the regulated business is approximately $4.2 billion. We also rolled forward our five-year regulated capital investment plan through 2030, amounting to $22.5 billion-$25.5 billion. That compares to our prior plan of $21 billion-$24 billion. The $1.5 billion increase in regulated investments is primarily driven by anticipated load growth due to data centers and other new customers, plus other incremental distribution, reliability, and resiliency investments. Our 2026-2030 regulated capital investment plan is expected to produce a compounded annual growth in PSEG's rate base of 6%-7.5%, starting from a year-end 2025 balance of approximately $36 billion, which includes construction work in progress.

These investments help us maintain our best-in-class reliability and customer service, as well as meet New Jersey's energy savings goals. Earlier this month, the BPU certified the results of the annual New Jersey BGS auction that was held to secure electricity for customers that have not selected a third-party supplier. Based on the competitive auction results, the cost of electricity supply on PSEG residential electric bills will decline by 1.8% starting June 1st, 2026. This decrease reflects the net impact of a lower overall 2026 BGS price that will replace the 2023 auction result that contained higher energy costs. Moving to PSEG Power and Other. For the fourth quarter of 2025, PSEG Power and Other reported a net loss of $37 million, compared to a net loss of $92 million in the fourth quarter of 2024.

Non-GAAP operating earnings were $10 million for the fourth quarter, compared to non-GAAP results of $43 million for the fourth quarter of 2024. For the full year, PSEG Power and Other reported net income of $366 million in 2025, compared to $225 million in 2024. Non-GAAP operating earnings were $284 million in 2025, compared to $292 million in 2024. Referring to the fourth quarter waterfall on slide 9, net energy margin was flat compared to the prior year quarter, as higher gas operations were offset by the absence of Zero Emission Certificates and lower generation volume due to the scheduled refueling at our 100% owned Hope Creek Nuclear Plant.

O&M was $0.04 per share higher compared to the fourth quarter of 2024, mostly driven by that Hope Creek refueling outage. As Ralph mentioned, PSEG Nuclear also completed work during the Hope Creek refueling outage to transition the unit from an 18-month to a 24-month refueling cycle going forward, which will yield additional megawatt hours as well as O&M savings over the long term. Depreciation expense was a $0.01 per share favorable, and interest expense rose by $0.04 per share, reflecting incremental debt at higher interest rates. Non-operating expenses were $0.02 per share higher, driven by a contribution to the PSEG Foundation, and taxes and other were a $0.01 per share favorable compared to the year earlier quarter.

On the operating side, the nuclear fleet produced approximately 7.2 TWh during the fourth quarter of 2025, compared to approximately 7.3 TWh in the fourth quarter of 2024. For the full year of 2025, nuclear generation was approximately 30.9 TWh, up slightly from 30.6 TWh in 2024. Capacity factors for the nuclear fleet were 83.7% and 91.2% for the quarter and full year of 2025, respectively. Touching on some recent financing activity. As of the end of December, PSEG total available liquidity remained strong at $2.8 billion, including approximately $130 million of cash on hand. Liquidity was supported by solid cash from operations during 2025.

On the financing front, in December, PSEG Power amended its existing $400 million, 364-day variable rate term loan, which increased the balance to $500 million and extended its maturity to December of 2026. PSEG's variable rate debt at the end of December consisted of the 364-day term loan at Power for $500 million, which matures in December this year, and commercial paper. As of December 31st, our level of variable rate debt represents approximately 6% of our total debt. Looking ahead, our balance sheet supports the execution of PSEG's 5-year capital spending plan through 2030, which is dominated by regulated CapEx, without the need to sell new equity or assets, and provides the opportunity for continued dividend growth.

Funds from operation to debt is projected to be in the mid-teens through 2030, comfortably above our minimum threshold. Now, before I conclude my remarks, let's review some earnings drivers for 2026, as outlined on slide 5. First, we're starting with higher rate base of approximately $36 billion at year-end 2025, and that's up about 7% over year-end 2024. In addition, clause-based recoveries for investments in distribution, infrastructure, and CEF Energy Efficiency II are expected to contribute to utility margin. As we discussed on the third quarter call, PSE&G's annual FERC transmission formula filing was implemented on January 1st, with an $82 million increase in annual transmission revenue subject to true-up. On the distribution side of the business, electric base rates for 2026 are projected to be stable.

At PSEG Power and other, our expected generation output for 2026 is approximately 95% hedged. Like last year, we do not expect to book nuclear PTCs in 2026 due to the higher price environment. Just as a reminder, the Zero Emission Certificates amounts earned by our New Jersey nuclear units concluded in May of last year. Our nuclear refueling cycle for 2026 includes a spring refueling at Salem Unit 2 and fall refuelings at Salem Unit 1 and Peach Bottom Unit 2. Hope Creek is scheduled for its next refueling in the fall of 2027, following the completion of fuel cycle extension work in the fourth quarter of 2025 and a shift to a 24-month refueling outage schedule.

As we continue to stringently manage our controllable costs, we will see interest and depreciation expense that will rise with a higher investment balance at PSE&G and higher interest expense at PSEG Power and Parent related to refinancing maturities at higher current interest rates. In closing, we are proud to have delivered on our 21st year in a row of meeting or exceeding our earnings guidance, and we carry that confidence forward to our full year 2026 non-GAAP operating earnings guidance of $4.28-$4.40 per share, 7% higher at the midpoint over 2025 results. We increased our dividend by over 6% and updated our long-term non-GAAP operating earnings CAGR to 6%-8%, using a higher baseline for the second year in a row.

Earnings growth beyond our forecast is achievable through opportunities to contract our existing output and planned upgrades, as well as from incremental regulated capital investments. That concludes our formal remarks. We are ready to begin the question and answer session.

Ladies and gentlemen, we'll now begin the question and answer session for members of the financial community. If you have a question, please press the star and the 1 on your telephone keypad. If your question's been answered and you wish to withdraw your polling request, you may do so by pressing the star and the 2. If you're on a speakerphone, please pick up your handset before entering your request. One moment, please, for the first question. The first question is from the line of Shar Pourreza with Wells Fargo. Please just use your question.

Not too bad. Not too bad. Busy, busy. Ralph, just on the legislative side, I mean, you've been kind of front and center around this for some time, around new gas. Can you just maybe talk about the timing of the bill, so next steps, will there be like an IRP process? Could there be like a PPA structure where you earn a return on the PPA, assuming a generator wins the RFP? How do we, like, work through things like air permits and kind of turbine queue backlogs? I guess, just how do you think about this whole process?

Boy, there's a lot there. You also answered your own question a little bit as you run through it, Shar. You know, much of it's in play, right? As you said, many of those variables that you laid out are the exact variables that policymakers need to come to grips with, right? There's a couple of bills that are floating down in Trenton right now that will help enable new nuclear and potentially new gas. I think the governor already has the ability to move on a lot of solar and potentially battery storage. The way we've been thinking about it is trying to help policymakers think through and then enable the opportunities for gas or for new nuclear, right?

We've talked about that in quite a few different settings, and that's really what we've been trying to do, is help them think through that at this point. All the items you mentioned, whether it be turbine backlogs, air permits, so on and so forth, all of those items are still variables that are out there that policymakers have to work through, the challenges they may face on any of them.

You can structure an IRP process relatively quickly for this?

Yeah. I mean, look, we could help out with an IRP for PSEG. We could help out with an IRP for New Jersey. I think that process, again, just informs the output. It doesn't drive the output because the policymakers will be the ones that really kind of own that as they go forward. The IRP will make recommendations, as we do all the time on Long Island, they're not going to be.

You know, definitive decisions. They don't carry the weight of the law, right?

Got it. Then just lastly, can you just maybe help us quantify, like, what level of hedges and upside versus the PTC you're kind of embedding in that 6%-8%? Is the bottom end of that CAGR kind of anchored in PTC level assumptions? Is there kind of an expectation of future updates to include above PTC earnings? Thanks.

Yeah. I'm going to give it to Dan to walk you through that. I talked about where we are for 26, in the prepared remarks, but Dan can give you a little bit more about that and, you know, being consistent with what he has spoken to before.

Yeah, sure. I think the, you know, the way to think about it, we talked about the prompt year being about 95% hedged, and we're pretty well hedged through the next couple of years, but certainly less so in the out years. You're looking more at a market view to try to get you to what that out year looks like. I think that market view is supported by some of the fundamentals that you're seeing out there.

If and as that moves over time, which we would expect that it would, we'll take that into account as we're making our comments and updating what's going on. I think that's the way to think about it.

Got it. That is perfect. Thank you guys so much. Much appreciated.

Our next question is from the line of Nick Campanella with Barclays. Please just use your question.

Hey, good morning, everyone. Thanks for the updates.

I guess in the past, you know, when you had a 5%-7%, you kind of talked about it being, you know, nonlinear, and now you have this 6%-8%, which is great to see. I just recognize you have things like refueling outages and timing of rate case outcomes at some point in this plan. Just maybe, can you kind of talk to whether this CAGR is linear or not, and where you may fall within the CAGR, 2027, 2028, and just the kind of critical drivers that people should be paying attention to here? Thank you.

Yeah. Nick, I think, you know, we have talked about for the last 3 years about being more predictable. With that is our effort to be as linear as possible. That doesn't mean we will be 100% linear, but we work really hard to do that, right? There will be structural changes that happen where, you know, we have to modify, and right now, I think the structural change has been the supply-demand curve, and we've seen that, and it's taken us above the PTC floor pretty clearly as we look forward. We adjusted. I think our goal remains the same, is to be a predictable investment for folks, and I think we've been able to achieve that by delivering the results that we said we were going to deliver.

We feel confident in the plan that we put forth today. Yes, our goal remains to be as linear as possible.

Thank you. I recognize that you forecasted the base off a higher midpoint of 26 as well. Thank you for that. Maybe just, you also can talk about

- you know, nuclear contracting. Absolutely. Absolutely. You talked about nuclear contracting to kind of put you above that range. Just maybe what's the latest thoughts on that at this point? I know the prior state administration was very focused on bringing data centers to the state. How is that kind of looking under this new administration? Just maybe anything you can kind of offer in what your conversations have kind of been with customers on that? Thank you.

Yeah, Nick, and I think the story is fairly consistent. I think that obviously, the most near-term things that you ought to be able to think about as this administration comes in and settles in on their views on this, is the facilities that we do have in Pennsylvania, where I think there's been a more firm view over time and more stability with respect to who has been in the governor's office there, as well as some of the smaller opportunities that we have, more locally within New Jersey. We've talked about a lot of the applications that the utility is seeing, and so there's, I think, less opportunity for something of a sizable scale in New Jersey just from the standpoint of where the administration has been.

To the extent that that changes and the receptivity is increased there could be incremental opportunity. I think for the time being, the more fertile ground right now would be Pennsylvania for something larger and some of the smaller New Jersey locations, and I think those discussions have progressed well.

Yeah, I would just add, Nick, just from a normal rhythm of transition for an administration like this, and the way it works in New Jersey, there'll be a real focus now. First of all, let's staff up, and I think the governor has done a great job of getting a number of people in place, not just in our industry, but in other areas that matter to the state running well. I think the second thing they need to do is really focus on the budget for New Jersey. That's where the, my understanding from conversations we've had is the focus of the governor right now. When she gets through that process, I think economic development will be right behind that as an area of focus.

You know, we are already having conversations on that organization that I chair, Choose New Jersey, about the role we'll play and the areas of focus, but that has not been finalized yet.

If I could just throw in one follow-up on Shar's question regarding kind of the nuke assumptions. You know, I understand that this RBA process is going on right now, and there is discussions around extending the RPM collar for another 2 years. A week or 2 ago, a 420 per megawatt day number was kind of thrown out there. Just what are your kind of thoughts on extending, you know, at the current cap rate through 2030, and then what's kind of embedded in the plan right now?

Yeah, look, I think, embedded within your question, Nick, is the fact that you've got a market out there where you can see what things are looking like, but it will remain somewhat dynamic as you step through time, and that's the best information that we have as well. What we're doing is trying to look at what that looks like. I think that, arguably, you could have stayed at 5 to 7, been at the PTC and been more firm, but I honestly think you'd be less realistic. What we're trying to do is take a realistic view as to what things will look like as we step out over the longer term.

I think we feel good about where we are and how it all fits together within the plan. I think it's those same market signals that we see, that you're seeing out there. I mean, as a reminder, I would highlight the fact that the location of our facilities is in the PSEG zone. If you're thinking about pricing and trying to do math to figure out what this means in the out years, that zone is most highly correlated to the actual generator buses, where we run. West Hub trades north of that. We said it trades about 20% above what we would be seeing from where our generator bus is.

It's those market points that we look at to try to derive where we're headed within the plan and what we put forth to you. I think we're in a really good place against that backdrop, but that's what we look at as we go forward.

Okay. I appreciate the thought. Thank you.

Our next question is from the line of Bill Appicelli with UBS. Please receive your questions.

Morning, Bill. Did we lose Bill? Morning, Bill. Rob, maybe you want to go to another one and see if Bill rejoins?

Sure. The next question will be from the line of Tanner James, with Jefferies.

Hey, good morning, team. It's Julian Dumoulin-Smith. How you guys all doing?

Hey, hey. Good morning to you guys. Thanks for the time. I appreciate it. Look, let me follow. By the way, nicely done on the CAGR increase. Got to hand it to you guys. If I could follow up on the gist of what Shar and Nick were asking us about here. Let's talk about the overlap between the BPU here and legislative process just a bit here, in terms of what next steps are from both and how they might overlap, right? Clearly there's a certain degree of mutual alignment between the two in theory. Can you comment a little bit on, maybe even more oriented towards timeline? I know Shar was kind of pressing at that as well here.

Yeah, I think that you're gonna have a little bit of give and take that will continue as people find their footing in this new administration, right? Not from the administration's finding their footing, but how the legislator is going to work, legislative area is going to work, and how the regulator is going to work. These 2 bills that were introduced recently, kind of direct the BPU to do certain things. The BPU has the ability to do certain things today. You know, go out and procure gas, to go out and procure new nuclear, right?

We had the ZEC process in the past, but they are limited in what they can do, they could use a little more direction to make the process a little cleaner for them by some legislative changes. I think that's just an open process that exists out there. I can't tell you it's going to happen in the next 30 days, and I can't tell you it's going to happen in the next 6 months. The level of interest and the engagement by folks is pretty high, it all comes out of the back end of the last, you know, 12 months of discussions about higher electricity costs from a supply standpoint, the need for us to change that balance somehow.

The scarcity is there, you know, we've got load increases that have taken place across PJM, even if we don't have a data center in New Jersey, and we do have. We have the smaller ones, as we've been talking about. The load increases are happening right across the river, and it's impacting the pricing here in New Jersey. You know, I think the BPU has recognized that they do not want to be in the same level of import that they are. The policymakers feel the same way, and they want a little more control over the pricing of the product that ultimately the residents of New Jersey hold us all accountable for.

Got it. If I can zero in a little bit, guys, on the 26 guide here, and thanks again for your help earlier. How do you think about what the breakdown is between the regulated utility side of that, year-over-year increase versus what's reflected in power? Even within power, can you comment a little bit about where you guys are hedged? I know you said you're, you know, 95% for this year. Just comment a little bit about where you are relative to that floor, if you will, just as a starting point. Just want to make sure we're all on the same page here.

Yeah, I mean, obviously, we're north of it because that's how we described it and how we put it out there. I think to go much beyond that would start to kind of break down the pieces beyond what our, what our overall guidance is. I think, just maybe repeating a little bit what I said before, Julian, if you think about what the market signals are that are out there, that's what we're leaning on. I would say that 26, we gave you a 95% hedge. 27, I think we're fair to say that we are largely hedged for that year.

In 2028, I think, you know, if you think about a ratable approach over 3 years that we talked about, mainly we would say that because the most liquid part of that curve is over those 3 years. We have leveraged that liquidity to be able to hedge up a fair bit of 2027 and 2028, 2029 and 2030 remains more subject to market forces as we go forward.

Well, let me try this differently. How do you think about earned returns in the current year here for the utility and/or, you know, kind of what's implied year-over-year in growth on an EPS basis?

Yeah, I. Look, Julian, I think we've been pretty clear about the fact that where there are structural changes, we'll make changes, and when the changes aren't structural, we'll look at what opportunity sets we have for maintenance activities that might be in a 4-year cycle, and try to look at that from a predictability standpoint for the investment community. We look at our plans every year, we adjust to that. Again, I just want to reinforce the, really happy with the top end of the 5 to 7 that we've been running for the last couple of years, but we thought it was struck the scarcity issue of power was enough to structurally change our thought process to be in that 6 to 8, based upon where prices are driven by both the capacity and the energy side.

It is, I know I'm, you're trying to push us into a little bit of a conversation about ROEs and the utility and that, and we just feel comfortable talking right now about that predictable, pattern that we've talked about from an earnings standpoint.

Yeah. No, I hear you. The, the increase here is principally predicated on the power side of the business for sure on future years. Excellent, guys. Thank you so much.

The next question is from the line of Bill Appicelli with UBS. Please just use your question.

Yes. Hi, Ralph. Hi, Dan. Thank you. Apologies for that technical problem. Just maybe building on, you know, some of these other, you know, incremental regulated capital investments, and forgive me if you already addressed it and I missed it, but, I guess, you know, where in the spectrum would those fall and, what types of projects are we talking about there?

I think they come in really two buckets, right? There's incremental transmission that's, you know, in the PJM region. We've been active in that process, and we're successful, as we've talked about a bunch of times in Maryland, and we continue to look at those opportunities when they present themselves. There's a very specific effort going on in the state of New Jersey right now about being ready for solar, and the need for us to make sure that our distribution system is ready. That's been an ongoing process down at the Board of Public Utilities, and there were comments received on that in the last couple of weeks down there, if I recall correctly, that we submitted in another state.

That could drive some incremental investment for us as we, as we continue to make sure that this focus on solar and batteries can be enabled by the distribution system, that they're going to be as they're connecting to. The third bucket is the opportunity for us to participate on the generation side, again, depending upon where policymakers land on that front. I would say all three of those are the areas that we talk about around the table on a regular basis.

On top of that, though, I would just add that, you know, embedded within kind of the base plan that we have in front of us, which the things that Ralph mentioned could add to that, I would still characterize what we put out as the updated capital forecast, as there's nothing in there that's, you know, a single project that's a huge part of the capital. It's going to require a whole bunch of permits to be able to get done. It's all stuff that sits in front of us and is shorter term in nature, and we can kind of knock out without a whole lot of red tape that we got to get through, or challenges we got to get through. It's just kind of a basic set of capital that.

No, it's a really good point that Dan's saying. I mean, everything I just said is above and beyond. We're not building in a percentage of any one of those buckets as we put out this capital forecast. These are small projects that are really 90% of them are being based upon end of life on the regulated side. We, you know, I've been telling my family anyway, if you think about what we do every day in replacing the infrastructure, it's just like the Portal Bridge.

For those of you that are in the New Jersey region and see NJ Transit delays right now as they upgrade that, the infrastructure in New Jersey is old, and we have an opportunity to make upgrades as a result of that.

All right. No, that's very helpful. Just one other one on the O&M side, I guess, what's embedded, you know, in the plan, in the 6-8 on that front, just at you, at the utility level?

As we build our plan, Ralph has often described it this way, you know, we take a look at what's in front of us, and whatever kind of an inflationary assumption we have there. Then we look to the businesses to try to pull back on that, to end up in a more reasonable place from a cost-cutting perspective and overall cost management perspective. If you've got a 3% inflationary assumption, you can pull that back down to, you know, 2 to 2.25 as everybody's looking for opportunities within those budgets to try to move to a better place. That's kind of how we structure it and how we move forward on it.

We know that we do have our labor agreements that are running out through 27, and those will get re-upped, and that will have an effect as well. We kind of lay out a baseline plan and then pull back some efficiencies to get to where our final plan lands.

Yeah, Bill, I mean, relatively flat with some inflation. Then we back it off, as Dan said. I know some people think we talk about, you know, finding pennies in the couches, which is a which I actually like. My wife and I still have a little bucket that we put our pennies in. It's not the worst thing in the world to go looking for them because they all add up at some point.

Public Service Enterprise Group Q4 2025 Earnings Call Transcript | Fortune

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Public Service Enterprise Group (PEG) Q4 2025 Earnings Call Transcript

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