Factbook

116 Pages·2017·3.05 MB·English

by  Patricia Cosgel

Factbook
May 2018

Avangrid, “utility of the future”
Legal Notice
FORWARD LOOKING STATEMENTS
Certain statements in this presentation may relate to our future business and financial performance and future events or
developments involving us and our subsidiaries that are not purely historical and may constitute “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of
forward-looking terms such as “may,” “will,” “should,” “would,” “could,” “can,” “expect(s,)” “believe(s),” “anticipate(s),” “intend(s),”
“plan(s),” “estimate(s),” “project(s),”“assume(s),” “guide(s),” “target(s),” “forecast(s),” “are (is) confident that” and “seek(s)” or the
negative of such terms or other variations on such terms or comparable terminology. Such forward looking statements include, but are
not limited to, statements about our plans, objectives and intentions, outlooks or expectations for earnings, revenues, expenses or
other future financial or business performance, strategies or expectations, or the impact of legal or regulatory matters on our business,
results of operations or financial condition. Such statements are based upon the current reasonable beliefs, expectations and
assumptions of our management and are subject to significant risks and uncertainties that could cause actual outcomes and results to
differ materially. Important factors that could cause actual results to differ materially from those indicated by such forward-looking
statements include, without limitation, the risks and uncertainties set forth under the section entitled “Risk Factors” and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the
year ended December 31, 2017, which is on file with the Securities and Exchange Commission (SEC) and available on our investor
relations website at www.Avangrid.com and on the SEC website at www.sec.gov. Additional information will also be set forth in
subsequent filings with the SEC. You should consider these factors carefully in evaluating for-ward looking statements. Should one or
more of these risks or uncertainties materialize, or should any of the underlying assumptions prove incorrect, actual results may vary
in material respects from those expressed or implied by these forward-looking statements. You should not place undue reliance on
these forward-looking statements. We do not undertake any obligation to update or revise any forward-looking statements to reflect
events or circumstances after the date of this presentation whether as a result of new information, future events or otherwise, except
as may be required under applicable securities laws.

About AVANGRID
AVANGRID, Inc. (NYSE: AGR) is a diversified energy and utility company with approximately $32 billion in assets and operations in
27 states. The Company operates regulated utilities and electricity generation through two primary lines of business, Avangrid
Networks and Avangrid Renewables. Avangrid Networks includes eight electric and natural gas utilities, serving 3.2 million customers
in New York and New England. Avangrid Renewables owns and operates 7.1 gigawatts of electricity capacity, primarily through wind
power, with presence in 22 states across the United States. AVANGRID employs approximately 6,600 people.
For more information, visit www.avangrid.com.
[email protected]
Avangrid, “utility of the future” 2
Legal Notice
Use of Non-GAAP Financial Measures
To supplement our consolidated financial statements presented in accordance with U.S. GAAP, AVANGRID considers certain non-GAAP
financial measures that are not prepared in accordance with U.S. GAAP, including adjusted net income, adjusted EPS, adjusted gross
margin and adjusted EBITDA. The non-GAAP financial measures we use are specific to AVANGRID and the non-GAAP financial measures
of other companies may not be calculated in the same manner. We use these non-GAAP financial measures, in addition to U.S. GAAP
measures, to establish operating budgets and operational goals to manage and monitor our business, evaluate our operating and financial
performance and to compare such performance to prior periods and to the performance of our competitors. We believe that presenting such
non-GAAP financial measures is useful because such measures can be used to analyze and compare profitability between companies and
industries because it eliminates the impact of financing and certain non-cash charges as well as allow for an evaluation of AVANGRID with a
focus on the performance of its core operations. In addition, we present non-GAAP financial measures because we believe that they and
other similar measures are widely used by certain investors, securities analysts and other interested parties as supplemental measures of
performance.
We provide adjusted net income, which is adjusted to reflect the effect of mark-to-market changes in the fair value of derivative instruments
used by AVANGRID to economically hedge market price fluctuations in related underlying physical transactions for the purchase and sale of
electricity, adjustments for the non-core Gas Storage business, and the impairment of certain investments and excludes the sale of certain
equity investments. We define adjusted EBITDA as net income attributable to AVANGRID, adding back income tax expense, depreciation,
amortization, impairment of non-current assets and interest expense, net of capitalization, and then subtracting other income and earnings
from equity method investments. We also define adjusted gross margin as adjusted EBITDA adding back operations and maintenance and
taxes other than income taxes and then subtracting transmission wheeling. The most directly comparable U.S. GAAP measure to adjusted
EBITDA and adjusted gross margin is net income. We believe that presenting these non-GAAP financial measures is useful in
understanding and evaluating actual and projected financial performance and contribution of AVANGRID core lines of business and to more
fully compare and explain our results. The most directly comparable U.S. GAAP measure to adjusted net income is net income. We also
provide adjusted EPS, which is adjusted net income converted to an earnings per share amount.
We provide adjusted net income and adjusted earnings per share, which are adjusted to reflect the effect of mark-to-market changes in the
fair value of derivative instruments used by AVANGRID to economically hedge market price fluctuations in related underlying physical
transactions for the purchase and sale of electricity, adjustments for the non-core Gas Storage business including certain losses related to
its sale, and restructuring charges primarily associated with reorganizing to better align our people resources with business demands and
priorities as part of the Forward 2020+ program. We define adjusted EBITDA as net income attributable to AVANGRID, adding back income
tax expense, depreciation, amortization, impairment of non-current assets and interest expense, net of capitalization, and then subtracting
other income and earnings from equity method investments. We also define adjusted gross margin as adjusted EBITDA adding back
operations and maintenance and taxes other than income taxes and then subtracting transmission wheeling. The most directly comparable
U.S. GAAP measure to adjusted EBITDA and adjusted gross margin is net income. We believe that presenting these non-GAAP financial
measures is useful in understanding and evaluating actual and projected financial performance and contribution of AVANGRID core lines of
business and to more fully compare and explain our results. The most directly comparable U.S. GAAP measure to adjusted net income is
net income. We also provide adjusted EPS, which is adjusted net income converted to an earnings per share amount.
Avangrid, “utility of the future” 3
Index
1. AVANGRID
1.1. Description…………………………………………………………. 6
1.2. Long Term Plan 2016-2022………………………………………. 14
1.3. Financing………………………………………………………….... 31

2. Avangrid Networks
2.1. Operating Utilities...……………………………………………..... 39
2.2. Projects & Capex………………………………………………….. 45
2.3. Regulatory………………………………...………………………... 55
2.4. How to Model.……………………………………………………… 69

3. Avangrid Renewables
3.1. Portfolio Characteristics…………………………………………. 76
3.2. Facilities & Contracts.…………………….……………………… 82
3.3. Drivers of Growth.………………………………………………… 92
3.4. Projects & Capex………………………………………………….. 103
3.5. Economics.……………………………………………………….… 107

4. Reconciliations…………………………………...……………………… 114

Avangrid, “utility of the future” 4
1. AVANGRID
Avangrid, “utility of the future” 5
1. AVANGRID
1.1. Description
Avangrid, “utility of the future” 6
AVANGRID is Focused on Regulated & Renewables Businesses
Formed by merger between Iberdrola USA and UIL in Dec 2015
Networks 81.5% Owned by Renewables
Iberdrola, S.A.
NYSE: AGR
www.AVANGRID.com
BBB+ Cre dit Rating
8 regulated utilities in NY, CT, ME, MA Third largest Wind Operator in the U.S.
Rate Base $9.1B
Customers Served ~3.2M
Wind & Solar Installed Capacity ~6.5 GW
Miles of Transmission Lines ~9k
Projects Under Construction ~0.5 GW
Miles of Electric Distribution Lines ~71k
Miles of Gas Distribution Pipeline ~24k
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AVANGRID Investment Highlights
Asset & Regulatory Mix Offers Geographic & Business Diversity
 8 regulated utilities in 4 states with $9.1B rate base(1)
 ~6.5 GW wind & solar in operation with ~75%-85% contracted or hedged
Strong Growth Opportunities in Regulated Assets & Contracted Renewables
 Rate Base CAGR ~9% (’16-’22)(2)
 ~8 GW onshore wind & solar pipeline (+ ~ 4 GW offshore wind)(3)
Attractive financial performance & balance sheet strength
 Adjusted EPS(4) CAGR 8-10% (’16-’22)(2)
 Lowest leverage in the utility sector
 Commitment to increase the dividend in ’18
Implementation of the “Utility of the Future”
 Opportunities beyond ’22, including Offshore Wind
 Investment in Advanced Metering Infrastructure (AMI) & Smart Grid Initiatives
 Innovative renewables solutions
Leading, Sustainable U.S. Energy Company with a Focus on Clean Energy
 90% Emission Free Capacity & CO emissions, 8 times lower than average U.S. utility
2
industry in ’16(4)
 Carbon Disclosure Project Score: A-
(1) As of 12/31/ 2017, including electric transmission and electric and gas distribution
(2) February 20, 2018 Long-Term Outlook
(3) Based on National Renewable Energy Laboratory’s estimate of 3 MW per square kilometer. Actual size of the wind projects TBD.
(4) U.S. Energy Information Administration 2016 figures.
Avangrid, “utility of the future” 8
AVANGRID Geographic Presence
~ $32 billion in assets with a presence in 25 states(1)
3rd largest wind operator in the U.S.
~ 6.5 GW installed capacity (wind & solar)
AVANGRID
Wind
Operations
Solar
Headquarters in
Thermal
Orange, CT
Networks
(1) AVANGRID completed sales of the Gas Trading and Gas Storage businesses on March 1, 2018 and May 1, 2018, respectively.
Avangrid, “utility of the future” 9
AVANGRID’s Net Electricity Production
1Q 2018 1Q 2018
AVANGRID
GWh % Weight % YoY GWh % Weight % YoY
Renewables 4,767 90% 14.8% 4,767 90% 14.8%
AVANGRID’s Net Electricity Production
Onshore wind(1) 4,620 87% 15.8% 4,620 87% 15.8%
1Q 2018 1Q 2018
AHVyAdrNoGRID 83 2% -29.1% 83 2% -29.1%
GWh % Weight % YoY GWh % Weight % YoY
Solar 44 1% 69.2% 44 1% 69.2%
Renewables 4,767 90% 14.8% 4,767 90% 14.8%
Fuel cells 20 0% -13.0% 20 0% -13.0%
OPea pk i nOegn sgrheoanreert awitoionrds(n1) al Data4,3 6210 Q 02%870%1580.10 5%.8% 4,3620 0%87% 50.105%.8%
Kla m a Hthy dCroogeneration(2) 55683 10%2% 16-.289%.1% 55683 10%2% 16-.289%.1%
Solar 44 1% 69.2% 44 1% 69.2%
TOTAL 5,326 100% 15.0% 5,326 100% 15.0%
Fuel cells 20 0% -13.0% 20 0% -13.0%
Peaking generators 3 0% 50.0% 3 0% 50.0%
AAVVKAAlNNaGGmRRatIIhDD C’’sso gNIneesntte aErlalleetidcot nCr(i2ca)iptya cPitryo(3d) ucti5o5n6 10% 16.8% AVANGRID5’5s6 Installe1d0 %Capacit1y6(3.8) %
TOTAL 5,3261Q 20118Q10 200%18 15.0% 1Q5, 32206117Q 2018100% 15.0%1Q 2018 1Q 2017
AAVVAANNGGRRIIDD AVANGRID
GWh % WeiMgWht % W%e YigohYt GMWWh %% WWeeiigghhtt % YoY MW % Weight MW % Weight
RReennAeeVwwAaaNbbGlleeRssID’s Installed Capacit4y,(736) 7 6,9602%7 148.89%% Renew46a,,70b63le77s 9808%% 14.8%6,627 89% 6,037 88%
OOnnsshhoorree wwiinndd(1) 4,620 6,8378%9 158.85%% Ons45h,,68o25re05 wind 8875%% 15.8%6,389 85% 5,855 85%
1Q 2018 1Q 2017
AHHVyyAddrrNooGRID 83 121%9 -29.12%% Hydro18139 22%% -29.1% 119 2% 119 2%
MW % Weight MW % Weight
SSoollaarr 44 110%6 69.21%% Solar 4540 11%% 69.2% 106 1% 50 1%
Renewables 6,627 89% 6,037 88%
FFuueell cceellllss 20 01%3 -13.00%% Fuel ce2103lls 00%% -13.0% 13 0% 13 0%
Onshore wind 6,389 85% 5,855 85%
PPeeaakkiinngg ggeenneerraattoorrss 3 201%2 50.03%% Peaking2 g0e93nerators 03%% 50.0% 212 3% 209 3%
KKllaa mm aa Htthhy dCCroooggeenneerraattiioonn((22)) 556 1603%6119 16.89%%2% Klamath56 C5366o1g1e9nerati1o09n%%(22)% 16.8% 636 9% 636 9%
Solar 106 1% 50 1%
TTOOTTAALL 5,326 71,0407%5 1150.00%% TOTAL56,,382862 110000%% 15.0%7,475 100% 6,882 100%
Fuel cells 13 0% 13 0%
Peaking generators 212 3% 209 3%
AAVVKAAlNNaGGmRRatIIhDD C’’sso gIEnensnetearrglaleyti doD nCe(2la)ivpearceitdy (3b) y Networks 636 9% 636 9%
TOTAL 11QQ7, 42270051188 100% 11QQ6, 82280021178 100%
AAVVAANNGGRRIIDD
GMWWh % W%e YigohYt GMWWh % W%e YigohYt
REleencetrwicaitbyles 69,,692973 893%% 69,,093973 28.68%%
AVANGRID’s Energy Delivered by Networks
N a tOurnaslh Goraes wind 256,,737889 856%% 255,,787585 68.05%%
1Q 2018 1Q 2018
AHVyAdrNoGRID 119 2% 119 2%
GWh % YoY GWh % YoY
A V ASNolGarRID’s Emissions Indicators 106 1% 50 1%
Electricity 9,993 3% 9,993 2.6%
Fuel cells 13 0% 13 0%
Natural Gas 25,7781Q 2018 6% 1Q 201275,778 6.0%
Peaking generators 212 3% 209 3%
CO emissions over the period (g CO /kWh) 42.5 57.9
Kla2math Cogeneration(2) 2 636 9% 636 9%
CO emissions over the period (lbs CO /MWh) 93.6 127.7
TOAT2AVLANGRID’s Emissions Indicato2rs 7,475 100% 6,882 100%
1Q 2018 1Q 2017
(1) Owned & JV
AVCAONG eRmIDiss’sio Ensn eovrgery tDhee lpiveeriroedd ( gb Cy ONe/ktWwohr)ks 42.5 57.9
(2) Inc2ludes 100MW of Klamath peaking g2enerator
(3) C NOa2m eempilassteio cnasp oacvietyr the period (lbs CO2/MWh) 1Q 2018 93.6 1Q12 270.718
AVANGRID
GWh % YoY GWh % YoY
Ele(c1)t r i cOitwyned & JV 9,993 3% 9,993 2.6%
Nat(2u)r a lI nGcalusdes 100MW of Klamath peaking gener2a5to,7r78 6% 25,778 6.0%
(3) Nameplate capacity
AVANGRID’s Emissions Indicators
Avangrid, “utility of the future” 10
1Q 2018 1Q 2017
CO emissions over the period (g CO /kWh) 42.5 57.9
2 2
CO emissions over the period (lbs CO /MWh) 93.6 127.7
2 2
(1) Owned & JV
(2) Includes 100MW of Klamath peaking generator
(3) Nameplate capacity