賓州電力 (PPL) 2009 Q4 法說會逐字稿

Good morning and welcome to the PPL Corporation fourth-quarter conference call.

All lines have been placed on mute to prevent any background noise.

After the speakers' remarks, there will be a question-and-answer session.

(Operator Instructions).

Thank you.

Mr.

Joe Bergstein, Manager of Investor Relations, please begin.

Good morning.

Thank you for joining the PPL conference call on fourth-quarter and 2009 results and our general business outlook.

We are providing slides of this presentation on our website at www.pplweb.com.

Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from such forward-looking statements.

A discussion of the factors that could cause actual results or events to vary are contained in the appendix to this presentation and in the Company's SEC filings.

That this time I'd like to turn the call over to Jim Miller, PPL Chairman, President, and CEO.

All right, thanks, Joe.

Good morning, everyone, thanks for getting on the call.

As normal, we'll start with the general business update and talk a little bit about the fourth-quarter and year-end results and then go into a Q&A session.

On the call this morning with me are Paul Farr, our Chief Financial Officer, and Bill Spence, our Chief Operating Officer.

This morning, as you know, we released our fourth-quarter and year-end results and for the fourth quarter we reported earnings of $0.40 a share on a GAAP basis compared with earnings of $0.74 a share a year ago.

Our 2009 full-year GAAP results were $1.08 compared to $2.47 per share in 2008.

We're very pleased to report that our 2009 earnings from ongoing operations, based on a very strong fourth quarter, were $1.95 per share, well ahead of our forecast for the year.

In the fourth quarter, earnings from ongoing operations were $0.52 per share, versus $0.46 a year ago.

Our strong performance in some pretty difficult times, I think, speaks well of our assets and our overall model and about our dedication of our employees to help us work our way through a pretty tough year in the economy.

We were able to outperform a very challenging business plan for the year, and we had very solid operating performance and some higher wholesale energy margins.

We implemented a cost reduction initiative early in the year and that was an important contributor to our strong results for 2009.

On the operating front, we set annual electricity generation records at some of our power plants in Pennsylvania and Montana.

Some of these 2009 accomplishments will drive longer-term benefits for our shareowners and customers.

We successfully transitioned to competition in Pennsylvania this year, and we completed a successful regulatory review process in the United Kingdom that sets our electric delivery prices for the next five years.

Decisions to move ahead with major hydroelectric expansions in Pennsylvania and Montana were made.

And the NRC approved a 20-year renewal of our operating license for the two units at the Susquehanna nuclear plant.

Let's move on to 2010.

This morning we, as well, reaffirmed our 2010 earnings forecast of $3.10 to $3.50 a share.

The midpoint of our 2010 forecast represents nearly 70% increase over our 2009 earnings from ongoing operations.

The main driver of the significant increase, of course, is the expected strong growth in energy margins in our supply business.

I'd just like to briefly comment on a couple of public policy issues before we turn the call over to Paul and Bill.

As you all are seeing out there in the news, it appears very unlikely that we'll see congressional action regarding CO2 emissions in the near future.

We do continue to believe that certainty would be beneficial as the industry moves down the road, but I'm not real optimistic that there'll be definitively legislative action any time soon.

Meanwhile, PPL and other utility companies will provide input as the Environmental Protection Agency process moves forward.

In Pennsylvania, our rate caps have expired for the customers of PPL Electric Utilities.

There's been substantial competitive retail supplier activity in the service area, and that benefits not only PPL, but its customers, as well.

As of this week, more than 288,000 of the Company's 1.4 million electric delivery customers have selected an alternate electricity provider.

As a result, more than 40% of the electricity being used in electric utility service territory is being supplied by alternate suppliers.

So this really reinforces that the competitive market place is working well for the customers in Pennsylvania, as was intended.

Needless to say, we're continuing to provide customers with information about their supply options and on ways they can use their energy more wisely.

So with that, I will turn the call over to Paul Farr.

Thanks, Jim and good morning, everyone.

I'd like to begin by reminding everyone that 2008 earnings from ongoing operations include the operating results of the gas delivery business, but excludes special items related to its divestiture last year.

As Jim mentioned, our fourth-quarter earnings from ongoing operations were higher than last year, primarily driven by higher energy margins in the supply segment and higher delivery margins at WPD.

Lower earnings in our Pennsylvania delivery segment were a slight drag on the quarter.

I'll summarize the key earnings drivers by segment for 2009 and then get into our 2010 earnings forecast.

Let's start with the supply segment performance for 2009 on slide seven.

The supply segment earned $0.88 per share in 2009, a $0.07 increase over 2008 results.

Clearly, the single biggest driver of the comparative margins was $0.20 in trading losses in 2008 that we incurred when the market experiences a dramatic decline in wholesale energy prices and power market liquidity.

Other positive drivers of energy margins for the supply business segment in 2009 included higher value from our generation portfolio, partially offset by lower net margins from load-following agreements due to lower customer demand; higher operations and maintenance expenses; and higher depreciation.

Turning to slide eight, our Pennsylvania delivery segment earned $0.35 per share in 2009, a $0.09 decline compared to 2008.

This decrease was the net result of lower delivery margins, primarily due to milder weather and the weak economy, as well as higher financing costs due to the prefunding of a portion of PPL Electric Utilities 2009 debt maturity in October of 2008.

Turning to slide nine, our international delivery segment earned $0.72 per share in 2009, a $0.05 decline compared to 2008.

The decrease was primarily driven by less-favorable currency exchange rates in 2009 compared with 2008.

The FX impact was partially offset by higher delivery margins, primarily driven by higher prices due to inflation and a more favorable customer mix; lower O&M, primarily driven by lower pension expense; lower interest expense on WPD index-linked bonds; and lower UK income taxes.

Turning to slide ten, as previously mentioned, we are reaffirming our 2010 earnings forecast of $3.10 to $3.50 per share.

The higher expected earnings are driven by strong growth in energy margins from the generation portfolio and primarily based on hedged power and fuel prices, as well as established capacity prices in PGM for nex -- for this year.

These higher energy margins are expected to be partially offset by lower earnings at WPD, primarily driven by higher income taxes, higher pension expense and higher financing costs, which are, in turn, expected to be partially offset by higher delivery margins and more favorable currency exchange rates; higher O&M in the supply segment; higher O&M in the Pennsylvania delivery business segment due to increased funding for customer programs, increased vegetation management and expected higher uncollectible expenses; as well as higher depreciation.

Factoring in all of these drivers we expect approximately 77% of our 2010 earnings will come from our supply segment, international to contribute 15%, and the Pennsylvania delivery segment 8%.

On slide 11 we've updated our free cash flow before dividends numbers to reflect 2009 actual results, as well as a few minor changes for 2010.

The variances to 2009 from the numbers presented during the third-quarter call primarily result from increased earnings, moving the anticipated closing of the sale of the Long Island assets to 2010, and changes in working capital.

We do expect the Long Island sale to close very soon.

The 2010 forecast for the international segment reflects adjustments to CapEx, resulting from the completion of DPCR5, as well as more current projections of exchange rates.

Now I'd like to turn the call over to Bill for an update on operations.

Thanks, Paul, and good morning, everyone.

Let's turn, to slide 12 and I'm going to start with an update on our delivery businesses.

Last month the Pennsylvania Public Utility Commission conducted a binding pull, which indicates their intent to approve the PPL Electric Utilities portion of the Susquehanna-to-Roseland 500Kv transmission line.

A final order from the PUC is expected later this month.

We continue to work with the National Park Service to secure the relevant approvals for a small section of an existing line that would be upgraded as part of this project.

PGM continues to support the need for this line and a May 2012 in-service date.

As Jim mentioned, more than 288,000 PPL Electric Utilities customers have selected an alternate competitive electric supplier for 2010.

There are about 27 different retail suppliers providing electricity supply in the PPL EU territory; seven of them are focused on residential customers.

We've continued to encourage our customers to shop to take advantage of opportunities, as well as the many options that PPL provides for reducing electric usage.

I do want to stress that the effects of customers switching will have no material financial impact on PPL, as a result of our 2010 generation hedging strategy.

For PPL Electric Utilities, of course, this is just the pass through of costs and therefore does not affect that business segment at all.

Our supply segment is not materially affected as it's sold only 3% of its 2010 expected generation into load-following type transactions.

This, of course, includes transactions with PPL Electric Utilities.

Let me also provide a brief update on the electric utilities 2011 to mid-2013 POLR procurement process.

PPL Electric Utilities recently completed their third solicitation, which covered the 11-month period from January 1, 2011 through November 30, 2011 -- or I'm sorry -- yes, and thus far approximately one-third of the 2011 POLR supplies having contracted by electric utilities under their PUC-approved procurement plan.

One final note on the PPL Electric Utilities side, retail sales at the utility in the fourth quarter were 2.9% lower than the fourth quarter of 2008 on a weather-normalized basis.

This decrease was driven by lower industrial sales, which dropped by 9.6% for the quarter.

For the full year, retail sales were down 3.1%, driven by lower industrial sales of 11.9%.

Even though electric utility sales are down, distribution revenue has not declined significantly because of the rate structure for industrial customers, which is largely based on customer demand charges rather than kilowatt hour charges.

For 2010 we're expecting 1.7% load recovery compared to 2009.

Turning to slide 13 and our international segment, as Jim mentioned, Ofgem, the UK regulator, has issued its final proposals for their fifth price control review period.

We feel it was fair and produced a constructive outcome for WPD.

The result allows for an average increase in revenues of 6.9% per year plus inflation.

The higher revenues are the result of achieving an improved plan, which forecasts a capital spending increase of 31%, and operating expense increases of 14%.

Additionally, the exceptional performance by WPD has earned us additional revenue of over $240 million with the potential to earn above this under the Ofgem incentive programs.

The components of the revenue bonus are outlined for you in this slide.

Now moving on to supply, I'm pleased to report that as a direct result of hard work by our dedicated employees the Susquehanna nuclear station set a generation record in 2009.

The plant safely and reliably generated almost 19.5 million-megawatt hours last year and unit one set its own generation record, producing almost 10.5 million-megawatt hours.

The station also received NRC approval for 20-year operating license extensions for both units.

We also set new generation records for our hydro output in Montana and at our Brunner Island station in Pennsylvania.

On the hydroelectric front PPL received FERC approval to expand our public hydro plant in Pennsylvania.

Construction on this 125-megawatt expansion has already begun and we expect to finish the work in the spring of 2013.

In Montana we also have begun construction to expand the Rainbow hydro plant.

That expansion and redevelopment will replace several small units with a combined capacity of 37 megawatts with a single 60-megawatt unit.

Construction is expected to be completed in 2012.

In the fourth quarter we also completed our final scrubber construction project when we placed the second scrubber at the Brunner Island plant in service.

All the scrubbers, including those at the Montour facility, were successfully completed on time, safely and within budget.

This was over a five-year, $1.4 billion effort and, again, just a great job by our employees.

Finally, in November we completed the sale of the majority of our hydro assets in Maine for about $81 million.

Moving on to an update of our hedge program on slide 15, we've updated our hedge positions as of December 31st.

These levels have not changed substantially from the update we provided you at the end of the third quarter.

We continue to hedge our 2010 through 2012 expected economic generation, primarily through option collars, to protect against downward price movements and allow some upside if market prices recover.

This collared approach protects the base load generation from the volumetric risk associated with load-following contracts, as well as the associated price risk.

In addition, all of our capacity's been hedged, primarily through selling forward capacity in RPM auctions.

On the fuel side we've contracted for 100% of our uranium needs through 2012 as shown on slide 16, and for 2010 our wholly-owned plants are fully hedged for coal, with only a small open position at Keystone and Conemaugh.

Now I'd like to turn the call back to Jim Miller for the Q&A.

Jim?

Thanks, Bill.

All right, operator, let's open it up for questions, please.

(Operator instructions.).

Your first question comes from Paul Patterson with Glenrock Associates.

Good morning, guys.

Good morning, Paul.

The trading and marketing impact for the fourth quarter, could you elaborate a little bit more on that?

Elaborate in terms of --

I missed the quantification of it, I'm sorry, and just if you could review what it was for the year and what your outlook again is for 2010?

We ended up just a bit short because of the lower marketing volumes on the $85 million target, and we have decreased that expectation number down to $35 million for 2010, based upon the backlog that we've got on marketing deals and where we expect customer demand levels to be.

Okay.

Then taxes for the fourth quarter, how did they -- they looked a little bit low to me.

Could you just elaborate a little bit more on that, and just refresh our memory for what it should be for 2010?

It was primarily driven in the fourth quarter by settlement of some items with the UK Inland revenue that went in our favor, as well as some year-end dividend planning that we implemented.

I would expect next year that we would experience -- and I referenced it in my points primarily related to the international segment -- a return to -- I think we ended 2009 in the upper teens from an effective tax rate perspective in international that we'd be in the 27%, 28% range for next year, bringing corporate to something around 36%.

Okay.

And what was the impact of the settlement and the other things that you described earlier in the fourth quarter?

It was around a total of $0.08.

It was around $0.04 from -- $0.03 from dividend planning and around $0.03 or $0.04 from settlement of the Inland revenue item.

Okay.

And then just in terms of customer migration and shopping, what's your latest numbers on that and your expectations?

I know that you guys don't have a lot of exposure there -- I don't believe you do -- in terms of -- you guys don't have a lot of the POLR contracts, but could you just give us a little bit more flavor as what you're seeing there in your service territory?

Sure, Paul.

I mentioned in my comments, and I think Jim as well, that we have right now about 288,000 customers shopping.

That represents about 41% of the total retail load in the PPL Electric Utilities territory.

That continues to grow.

That's about 20% of the customers have now engaged in shopping and if you recall, we had about 10% of the customers that had taken advantage of the electric utilities prepaid post phase-in program.

So you have right now over a third -- or about a third of the customers that have taken proactive steps to manage their electric bill and we expect that to continue.

But you're right, it does not have a material impact on our supply business and, of course, no impact on the electric utility business because it's just a cost pass through.

Do you know who is getting the majority of your load?

Is there -- do you know who the competitors that are there that seem to be capturing most of that load, and who has the POLR that might be falling off the most, or -- excuse me, who has the most exposure there other -- obviously you guys don't, so who would it be, do you think?

I can't really say.

I don't know specifically for one thing and even if I did know specifically, I wouldn't be able to tell you under the confidentiality provisions under which suppliers are bound, so sorry.

Okay.

I thought I'd try.

Yes, good try.

Paul, this is Paul again.

That impact on taxes for the quarter I was off.

I was thinking versus budget.

It was just $0.03 versus prior year in the quarter.

The rest had been booked before that -- before the Q4.

What was it for the full year, I guess?

The total for the full year, year-on-year was $0.06, I believe.

Okay.

In net movement.

So tax planning that was more beneficial in 2009 over 2008, which also had some effective tax planning in it, as well.

Okay.

And then just finally back onto the customer migration, how much do you think will be -- I mean, of course, a lot of people may not be getting around to it until just now, how much do you think in the end or do you have any projections to how much actually might end up shopping?

We don't have a specific projection, Paul, but I think certainly the industrial and the commercial accounts are pretty much set in my mind, because they were most aware and most concerned and are targeted by the larger group of marketers in the region of those 27 that I mentioned.

On the residential side, I think customer shopping will continue, as more and more retail suppliers come into the territory.

I wouldn't be surprised to see us up at the 30% total level, when all is said and done, but we don't have a specific projection.

So that's just my best guess at this point.

Okay, great.

Thanks a lot.

Sure.

Your next question comes from Reza Hatefi with Decade Capital.

Thanks, guys.

Could you talk about at WPD what the earnings trajectory is for that segment going forward over the next few years?

This is tough to -- given that it's a UK company, it's tough to model it out.

Well, we've got -- you've the mid-point number in the press release as it relates to 2010, and you can see some of the net effect of the degradation that I talked about from the movements in pension and interest expense, and the benefit being offset by the revenue.

I will say that when you look at the comment that Bill made about the north of 6% average increase over the five years, Inland revenue did shape that so that the up-front impact to the consumer was lower, so that when we look at the shape of the margins, we are much more benefited at the back end of the five-year plan, specifically in 2013/2014, than we are at the front end.

So that kept down the headline rate to the consumer, but allowed the companies to earn over the five years what we think was a fair return, and a fair tradeoff for the items that they did change.

We don't have a forecast out beyond 2010, but I would expect an earnings profile that would grow through the five years off the 2010 number.

But I guess the 6% revenue increase per year, some of that gets offset with increased costs and increases and things of that nature?

Well, they do, but, again, both grow -- we did get a 14% increase in OpEx versus the prior five year to go along with that higher level of CapEx spending, and both the rate base and O&M costs are allowed to grow by inflation.

So there is some netting down with the natural hedge of the inflation index bonds that we used to finance the entity, but both the rate base and O&M benefit by inflation each year.

Some of that natural increase is built in and offset through the rate making process itself.

And I also noticed that your 2012 generation volumes went up, especially in the east.

East base load went up by around 2.5 or so terawatt hours.

What is that due to?

Yes, there's a couple of things driving that, but the biggest of those is the start of a contract with the Longview coal plant that's under construction in West Virginia where we have an offtake agreement there.

There's some outage timing that positively impacts 2012 and then the full year of the Susquehanna nuclear plant unit two up rate, it comes into play in that year, as well.

So those are the three drivers.

Reza, we had previously accounted for -- I'll use that term loosely -- the Longview project as a marketing project, but similar to the rest of the generation assets, including the pulls on ironwood, that's now all in the generation book, so we're reflecting that there.

It just previously wasn't categorized as that internally.

And this Longview, how should we think about the cost to you?

Obviously you have it in your expected generation and you have the average hedge price and whatever's open gets market price, but what is the cost to PPL?

The cost is confidential pursuant to the contract, but what I would say is that the -- it's basically a west hub financial swap, so we get basically west hub priced power and the price pursuant to the contract today versus forward prices is not materially different.

Historically it has been significantly in the money, but as power prices have come down it's not -- it's still in our favor, but not as significantly as it was.

And just lastly, on slide 16 you have your goal hedges, am I reading this correctly that, for example, in 2012 you're 62% hedged in the east, and of that 62%, 5% is fixed base and 95% is collars.

Yes, you're reading it correctly.

That's right.

Okay.

Thank you very much.

Sure.

Your next question comes from Paul Ridzon with KeyBanc.

You topped your guidance for 2009, can you talk about the drivers that got you there and any implications as to what you're thinking, either end of your 2010 guidance, and then just what you think the big variables to watch in 2010 are?

You've obviously got some pretty wide guidance out there.

When you say guidance for 2009, the actual performance versus, if you will, where we ended up?

Yes, you topped the top end of your guidance and what got you there and does that carry through to 2010?

From a quarterly perspective, I think as we assess performance for the year we built on performance throughout the year.

We had a very solid fourth quarter.

We went into the quarter a little short from a power perspective as we saw prices decline and recognized that we had a natural hedge in the load-following deals that we had, so if power prices would have risen -- and that would have logically been driven by customer demand -- there was a natural offset.

So at the front end of the quarter we got some benefit by being a little bit short in our power book, and then as we got to the month of December at the very back end of the quarter we saw some very good customer demand pickup as a result of the cold weather and that clearly benefited the load-following deals and that's continued a bit into, obviously, January.

The cost reduction initiative that Jim outlined at the very beginning of the year, a whole series of things that we did to try to address cost early when it looked like marketing was going to start to come down in a meaningful way for us got us probably in the $0.12 to, $0.13 land for the year.

And then I think we handled the demand destruction extremely well through a whole series of initiatives that the guys took in the various books, the generation books and the marketing books.

And then, as well, strong generation performance, really throughout the year ex the loss of a unit at coal strip that we had that ultimately in Q3 and Q4 we did get some insurance recovery on from a business continuity perspective.

So I think it was a steady performance, Paul, throughout the year and capstoned, again, by very strong generation performance and a very strong marketing and trading perspective in the last quarter, as well.

And do you anticipate these -- or some of these impacts flowing into 2010 and --?

Well, we did factor when we were able to reiterate guidance for these last couple of quarters now that -- when you say a wide range, we're still expec -- we're still exposed a bit to, obviously, operating performance the more hedge we get, we're exposed to interest rates, to currency exchange rates.

There's a lot of things that -- it would take a lot of things moving negative on us to get to the bottom end of range.

If we get beneficial weather, if the generation continues to perform strongly, which it has as we've enter this year, we clearly expect that we can outperform the midpoint.

So all of those items, though, have really been factored into the range when we set it and as we've been able to reiterate it.

But we feel very good about 2010.

Thank you very much.

Yes.

You are in next question comes from Steve Fleishman with Banc of America.

Yes, hi, good morning.

If you look at your Pennsylvania delivery forecast for 2010 could you give us a sense of what earned ROE you would have in Pennsylvania based on that?

And assuming it is pretty low, which I think it is, what your plan is for getting some rate relief at this point?

Yes, the ROE for 2009 was right around 8%, it'll be in the low sixes for 2010, and as we've said in the past, we expect that we'd be filing a rate case probably near the end of Q1 here for new rates to be effective on January 1, 2011.

So that would be the mechanism to get the earned back to a more acceptable level.

Okay.

And then one other question, just curious on -- I think Bill mentioned the load forecast is up 1.7%, I assume some of that's just normal weather helping, as well.

But I know in Pennsylvania they're starting to implement a lot of new energy efficiency initiatives and I'm curious what you're expecting the impact of energy efficiency to be on just deliveries in 2010 and beyond?

Sure.

Yes, I did mention the 1.7% and that's on a weather-normalized basis so --

Oh, okay.

-- it would not be -- that's the net.

So, yes, we do expect on the energy efficiency side around a percent or so of load reduction as a result of those initiatives.

So you'd really need to get 2.7%, let's say, than down the 1% for energy efficiency, but we did build that into our forecast.

Thank you.

Sure.

Your next question comes from Travis Miller with Morningstar.

Hi, good morning.

Good morning.

Question on your hedge positions.

It looks like you haven't done too much with it since maybe first half of 2009 and I was wondering if you could just talk through especially that 2012 view on the price -- on the energy pricing side.

Is there something you see right now in the market, or should we expect forward hedge roll-ons here in the next couple of quarters to move that ratio up?

I do think that over the next couple of quarters you'll see us start to layer in hedges for 2012.

We've been -- obviously with the downturn in the natural gas prices and the economy, we've been waiting for hopefully a rebound to give us some opportunity to layer in some more favorable hedges.

But as we get closer to 2012, we will want to start to lock some of that if.

Yes, we are -- when you say going back to Q2, as prices started to come down, even the hedges that we did back then are in the money given additional price deterioration.

We did hedge, really, to almost the upper end of our three-year hedging program limits at 100%, 90% and 60%, so there's really not -- at that point in time there wasn't much of a view but today, as Bill said, we're hopeful that there'll be some recovery in prices as customer demand picks back up.

So the hedge positions are, we think, very strong, we're glad we put them on, and we would be looking over the year as utilities bid load-following.

As the market presents some better opportunities we will look to hedge that up a bit as we make our way throughout the year.

I suppose that corresponds to a more bullish view point on demand on the delivery side as well, in the area -- or in the state and across the region.

Yes, I think we're certainly expecting some recovery, how quick is anyone's guess.

I did mention in my prepared remarks that we are using and continue to use collars to retain some of the upside in our hedging program.

Okay, great.

Thanks a lot.

Sure.

Your next question comes from Judd Arnold with King Street.

Just following up on Riva's question, I think you guys said you moved Longview and Ironwood into generation for marketing, I was wondering is there any impact this quarter when I look at marketing?

The change in gross margin, is that impacted at all by that move?

No.

Okay, but it's just go forward?

That's correct.

Okay.

My second question, Exelon made some comments at the CSB conference this week talking about the 2012 R -- or the next RPM auction that they think we're going to start to see impacts of guys with smaller, inefficient coal plants withholding capacity or pricing that capacity at a big premium to offset some of the ongoing environmental costs.

Do you think that's a true statement or can you add any color to that?

Well, certainly those type of plants are going to be more challenged depending on how the EPA deals with a variety of regulations that could impact coal stations, and we've seen that due to the economy and other pressures that capacity factors on some of those less-efficient units have gone down significantly.

Having said that, when we look at the next -- excuse me -- the next RPM auction and look at the planning parameters that have been adjusted, we really just see it as a flat to slightly positive impact due to the updating of the cost of new entry numbers, the cones -- they went from three to five zones -- as well as some transmission constraints that are projected out in that timeframe.

So I wouldn't say that we're projecting any material impact to the upside in that timeframe, not to say it couldn't happen.

It's not likely that the environmental issues will have revealed themselves at that point in time.

Not that they won't or can't in the future, but at that point in time, they will not have self revealed.

Got it.

Thanks much, guys.

Sure

(Operator instructions).

Your next question comes from Yiktat Fung with Zimmer Lucas Partners.

I would just like to clarify, on slide 13, those additional benefits at WPD, are those amounts per year or are they for the entire five-year plan?

Total over the five-year plan.

Yes, that's -- okay.

And are they more back-end loaded or are they spread evenly?

I think, as Paul mentioned, a lot of the benefits that we see in the outcome from the recent price review will be back end loaded.

Thank you very much.

Sure.

Your next question comes from Paul Ridzon with KeyBanc.

Can you quantify the weather impact versus normal for the year?

The weather impact on electric utilities for the year?

Yes.

Yes, one second.

Just one second, Paul.

It was a total of $0.04 between weather and shopping -- one second.

A little less than $0.02.

To the negative?

To the negative, yes.

Thank you.

Yes.

At this time there are no further questions.

All right.

Well, I think we're completing a solid year in 2009.

I think, as Paul and Bill mentioned, we are looking forward to a solid 2010.

We've tried to outline for you what issues and areas that certainly led us to a sound performance in 2009 and we're going to be working very hard to capitalize on those areas in 2010 to keep a strong earnings forecast out there for 2010.

So thank you for participating in the call.

Thank you, operator.

Thank you, ladies and gentlemen, for your participation.

You may now disconnect.