Detailed Narrative
Accelerated Load Growth in Houston Electric
CenterPoint's Houston Electric business is experiencing unprecedented🌐 growth, with peak load demand now projected to increase by 50%, or an additional 10 gigawatts, by 2029—two years ahead of prior forecasts. This acceleration is primarily driven by reshoring of advanced manufacturing facilities and new data center demand. The company has 2.5 GW of projects already under construction and another 5 GW of firmly committed projects expected to be energized by 2028, in addition to 3 GW of ordinary course growth.
Expanded Capital Investment Plan
The company has increased its 10-year capital investment plan by $500 million, bringing the total to over $65 billion through 2035. This incremental capital is allocated to fund an additional 765 kV import line, the third such line, to enhance resiliency and reliability in the Greater Houston region. Management also sees over $10 billion in further incremental opportunities beyond the current plan, which will be incorporated as clarity and approvals are achieved.
Strong Financial Performance and Outlook
CenterPoint reported non-GAAP EPS of $0.45 for Q4 2025 and $1.76 for the full year 2025, reflecting 9% growth year-over-year. The company reaffirmed its 2026 non-GAAP EPS guidance of $1.89 to $1.91, representing an 8% increase at the midpoint from 2025 results. Long-term, CenterPoint expects to grow non-GAAP EPS at the mid- to high end of its 7% to 9% annual range through 2028, and 7% to 9% annually thereafter through 2035.
Regulatory and Balance Sheet Enhancements
The company achieved a constructive final order in its Ohio gas LDC rate case, approving a 9.79% ROE and 52.9% equity ratio. Significant balance sheet support is expected from $1.2 billion in securitization bonds priced for Hurricane Beryl and $800 million (net of tax) from the Ohio gas LDC sale in Q4 2026. New U.S. Treasury guidance on the Corporate Alternative Minimum Tax (CAMT) is expected to reduce annual cash tax liability to near zero through 2035, improving FFO to debt by 60-70 basis points and unlocking $1 billion in capital investments without additional equity.
Customer Affordability and Benefits
The accelerated large load growth is expected to have positive impacts on customer affordability by spreading fixed costs over a wider base. The company estimates that utilizing 5 gigawatts of existing hosting capacity by data centers could reduce average residential delivery charges by over 2% based on the 2025 average bill. This trend is anticipated to help keep customer charges essentially flat through 2028.
ERCOT Interconnection Process Management
CenterPoint supports ERCOT's batching process but notes its unique position in Houston, where large load interconnection applications have historically been processed within 70 days, avoiding the backlog seen in other regions. The company is working with customers to complete load studies quickly to submit requests to ERCOT this spring, ensuring firm projects can come online in the 2027-2028 timeframe, regardless of the transition to batching.