Detailed Narrative
Houston Electric large-load acceleration to 12.2 GW
Management raised the firmly committed new industrial load forecast for Houston Electric to 12.2 GW, up from 7.5 GW on the Q4 call. 3.2 GW has already secured ERCOT approval (2.5 GW of it approved within <80 days of filing since the last call), and the remaining 9 GW is slated for ERCOT submission within a few weeks, expected to qualify for 'batch 0.' The pipeline is diversified across 12+ unique customers and nearly 20 projects, with 90% of demand at 0.5 GW or less per project, aiding fast, efficient interconnection near existing substations. CNP expects to energize ~8 GW by 2029.
Wires model: demand charges over capex
In ERCOT, CenterPoint provides only transmission and distribution service, and large-load customers pay for the switchyard, substation and interconnection modifications needed to connect. So the 12.2 GW does not directly drive the capex plan. Instead, each 1 GW of industrial load generates roughly $6 million/month of incremental demand charges — an earnings and affordability tailwind — while indirectly creating the need to replace system capacity, which will surface as incremental transmission projects in a second-half 2026 update.
Transmission capacity replacement and 765 kV buildout
CNP has ~10 GW of existing hosting capacity plus ~9 GW of generation (largely solar and batteries) connecting in the greater Houston/eastern region. The base $65.5B plan already includes intra-regional projects to move power where needed and 765 kV import lines coming online in 2031-2032. A transmission study due in H2 2026 targets the 2029-2031 gap where existing capacity is exhausted before the 765 kV lines add import capacity, and is expected to yield a significant set of new transmission and system-stability projects.
Indiana transformational load opportunity
CenterPoint is increasingly confident on a large-load customer in its Southern Indiana territory — its single largest load there — that could enable ~$250 million of residential customer savings over 15 years. It plans to unlock at least 1.5 GW of incremental capacity using existing capacity, a MISO-queue transmission project, and converting a simple-cycle CT into a combined-cycle facility, implying ~$1 billion of incremental capex within 2027-2029, with upside for further large-load customers beyond that.
Regulatory recovery and rate case calendar
About 85% of investments are recovered through capital trackers. Houston Electric's DCRF sought a ~$108M revenue-requirement increase (settled, rates effective June, ahead of plan) and its TCOS sought ~$36M (approved, rates effective last week). Texas Gas GRIP requested ~$62M (expected in rates June). Gas rate cases in Minnesota (replacement capex) and Indiana (combining two cases into one for a customer-bill benefit) are planned for Q4 2026; those gas businesses represent <20% of consolidated earnings power.
Balance sheet, financing and AMT tailwind
Adjusted FFO/debt on Moody's methodology was 12.5%, pressured by pulling debt issuances forward into attractive markets; management expects to end 2026 at the high end of its 150 bps cushion. Nearly 70% of 2026 financing is complete, a $650M February convertible cut floating-rate exposure, and parent commercial paper stood at $0 versus ~$1B normal. A corporate AMT change ends ~$150M/year of cash taxes (with a refund plus prior-period recoveries), which management says can fund ~$1 billion of incremental capex with no new equity beyond the $4B common equity plan.