WEC Energy Group (WEC) Q4 FY25 earnings call: guidance and Q&A

Seeking more detail on the 500 MW Microsoft expansion, potential beyond the 5-year plan, and the full scale of the opportunity.

Scott Lauber confirmed the 500 MW is from new land north of Highway 11, and Microsoft views Wisconsin as a "multiyear delivery," suggesting more growth beyond 2030. He noted Microsoft is looking for more land and has been transparent locally, but he doesn't want to get ahead of their announcements.

“I do not want to get out ahead of Microsoft and their plans. All I can really say is they're starting to do land at about 570 acres, and that's about where we put that 500 megawatts. There's more land. That's just the start of that development.”

asked by Julien Dumoulin-Smith · answered by Scott Lauber

Asking about additional hyperscaler interest beyond Microsoft/Vantage and the strategy to attract customers despite local opposition to data centers.

Scott Lauber stated confidence in other opportunities and ongoing discussions, noting that hyperscalers are now more transparent and proactive with communities. He highlighted the VLC tariff as a key tool to ensure fair payment and transparency, which hyperscalers appreciate.

“I'm very confident that other people are looking at opportunities in Wisconsin, and we have a lot of discussions. And even Microsoft has talked about even being more transparent. So I think everyone understands they need to be more transparent, working more with the communities, being much more proactive than they were 2 years ago.”

asked by Alexander Calvert · answered by Scott Lauber

Inquiring about the potential to settle the VLC tariff case and the timing of the GRC filing.

Scott Lauber expects the VLC tariff to go through the full commission decision process to ensure transparency and fair cost allocation, with a decision expected in early May. He confirmed the GRC filing is on track for April.

“The very large customer tariff, I see that going the entire period that the commission makes a decision. And one of the items that we want to make sure we have when everyone talks about affordability and data center causing rate increases, this tariff is one of the best or the best out there, we think, to make sure the data centers pay their fair share.”

asked by Nicholas Campanella · answered by Scott Lauber

How the company is considering potential election rhetoric around affordability when preparing for the Wisconsin rate case filing.

Scott Lauber acknowledged the focus on affordability, especially with an open governor's race. He stated the company is actively working to keep rates low through cost-saving initiatives and noted a $55 million positive fuel recovery that will be returned to customers, demonstrating their commitment to affordability.

“We think about affordability every day, but that's how we're kind of factoring stuff in.”

asked by Carly Davenport · answered by Scott Lauber

Asking if Microsoft's growth could lower rates for other customers and for a sense of the rate impact in the upcoming Wisconsin rate case.

Scott Lauber explained that as data centers pay their fair share, including corporate allocations and common costs, it will eventually reduce the burden on other customers. He noted that data center rate base is expected to be 14% to 15% of total earnings in the 5-year plan, spreading common costs across a larger base.

“As you can imagine, even like we went through the acquisition of Integrys, we are able to spread common costs across a bigger footprint. Having data centers will have significant rate base. I think in our 5-year plan, we're looking at that rate base being the 14% to 15% of our earnings.”

asked by Michael Sullivan · answered by Scott Lauber

Given the high price of the expiring Point Beach PPA, why not assume new build generation would be preferred over recontracting, and if retired coal plant sites could be used for new builds.

Scott Lauber agreed that new build is a "pretty good assumption" given the high PPA prices, and the company will prioritize what's economic for customers. He noted that previously retired coal plant sites are now used for economic development, so new locations would be needed, considering natural gas line access.

“I think you're gluing it together a pretty good assumption there that those prices are pretty high. And if those prices, they think they should be that high, a new build, when you think about affordability, probably makes sense.”

asked by Paul Fremont · answered by Scott Lauber