Fortis Inc. Unveils $26 Billion Capital Strategy and Dividend Boost
Fortis Inc. Unveils Significant Five-Year Capital Plan
Fortis Inc. has announced an ambitious five-year capital outlook of $26 billion, reflecting its commitment to enhancing both its customer service and shareholder returns. This plan not only represents a $1 billion increase over previous projections but also establishes Fortis as a frontrunner in the regulated electric and gas utility sector within North America.
Comprehensive Overview of the New Capital Plan
This capital plan aims to drive a remarkable 6.5% average annual rate base growth through 2029. It primarily revolves around critical investments in transmission infrastructure at ITC and robust customer growth seen in Alberta.
Goals of the Capital Strategy
CEO David Hutchens highlighted, "Today we are pleased to announce our largest five-year capital plan to date. This evolution in our strategy is directly linked to investments in transmission and sustaining customer growth across our operational footprint." This plan illustrates Fortis' dedication to reliability and affordability.
Investments Focused on Energy Transition
Fortis’s capital allocation includes approximately $6.7 billion aimed at facilitating energy transitions. The focus here is on making connections between renewable energy sources and the grid, as well as investments in storage and natural gas. Funding will also enhance resilience, modernizing infrastructure to handle modern energy demands.
Projected Growth and Funding Sources
The five-year outlook anticipates growth in the midyear rate base from $38.8 billion in 2024 to a substantial $53.0 billion by 2029. This trajectory indicates a compound annual growth rate of 6.5%, positioning Fortis for sustained growth in the upcoming years.
A Look at Dividend Increases
In conjunction with the capital outlook, Fortis has declared a 4.2% increase in its common share dividend, raising it to $0.615 per share. This increase marks an impressive milestone, celebrating 51 consecutive years of dividend growth for shareholders.
Dividend Growth Forecast Through 2029
The corporation's annual dividend growth guidance has been extended to 4-6% through 2029. This forecast underscores Fortis' unwavering commitment to returning value to its shareholders.
Strategic Investments to Enhance Reliability and Expansion
Alongside traditional investments, Fortis is actively exploring projects linked to the MISO Long Range Transmission Plan. The goal is to bolster the electric transmission grid while promoting climate resilience and sustainability. Efforts are also in place to invest in liquefied natural gas infrastructure across regions where Fortis operates.
Insights into MISO Developments
The Midcontinent Independent System Operator (MISO) has reaffirmed the projects allocated to ITC, enabling the recommencement of crucial projects within Iowa. This situation highlights the resilience and capability of Fortis in navigating regulatory frameworks while advancing project initiatives.
About Fortis Inc.
Fortis stands as a leader within the North American utility sector, boasting 2023 revenues of $12 billion and assets totaling $69 billion as of mid-2024. With a workforce encompassing over 9,600 employees, Fortis provides essential utility services to customers across various territories including five Canadian provinces and ten U.S. states.
Frequently Asked Questions
What is Fortis Inc.'s new capital plan for 2025-2029?
Fortis Inc. has announced a substantial capital plan of $26 billion aimed at enhancing its transmission infrastructure and supporting energy transitions.
How much will Fortis increase its annual dividend?
Fortis will increase its common share dividend by 4.2%, bringing the total to $0.615 per share.
What initiatives does the capital plan support?
The capital plan supports energy transition initiatives, cybersecurity, infrastructure improvement, and overall customer growth across the utility sector.
How has Fortis performed in terms of dividend growth?
Fortis has a remarkable record of increasing dividends, achieving 51 consecutive years of growth for its shareholders.
What regions does Fortis serve?
Fortis operates in five Canadian provinces, ten U.S. states, and three Caribbean nations, delivering vital utility services across a broad spectrum.
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