Fortis, a prominent player in the North American regulated electric and gas utility sector, has unveiled its outlook for the period spanning from 2024 to 2028.

The company’s 2024-2028 capital plan, totalling C$25bn ($18.59bn), marks the largest investment initiative in its history. This amount represents a substantial increase of C$2.7bn compared to the previous five-year plan. The expansion is made possible thanks to the provisions of the Inflation Reduction Act of 2022.

The augmented budget predominantly focuses on regional transmission projects at ITC related to the initial phase of the Midcontinent Independent System Operator’s long-range transmission plan. Additionally, significant allocations are directed towards investments in Arizona, intended to facilitate Tucson Electric Power’s transition away from coal. The capital plan also includes funding for initiatives aimed at enhancing system adaptability and resilience, supporting customer growth, and fostering economic development across the corporation’s entire operational network.

The five-year capital plan is characterised by its low risk and high feasibility, with nearly 100% of investments falling under regulated categories, and 18% earmarked for major capital projects. Approximately 27% of this comprehensive plan is dedicated to investments in cleaner energy, with a particular emphasis on integrating renewables into the grid. This includes funding for renewable and storage projects in Arizona and the Caribbean, as well as cleaner fuel solutions in British Columbia.

Fortis’ five-year capital plan is projected to elevate the midyear rate base significantly, growing from $36.8bn in 2023 to an estimated $49.4bn by 2028. This translates to a robust five-year compound annual growth rate of 6.3% on a constant foreign exchange basis. Importantly, the plan remains committed to ensuring customer affordability while guaranteeing a reliable and resilient energy delivery service, particularly as the corporation navigates its transition towards a cleaner energy future.

The five-year capital plan is expected to rely primarily on funding from cash generated through operations and regulated debt. Additionally, common equity proceeds will be secured from two principal sources: the Corporation’s dividend reinvestment plan and an at-the-market common equity program.

Looking beyond this five-year capital plan, Fortis envisions a broader landscape of growth opportunities. These encompass various strategic initiatives, including the expansion of the electric transmission grid in the US. This expansion is geared towards facilitating the integration of cleaner energy sources and involves significant infrastructure investments related to both the Inflation Reduction Act of 2022 and the Midcontinent Independent System Operator’s long-range transmission plan.

Furthermore, the Corporation is committed to making investments in climate adaptation and grid resiliency, reinforcing its ability to adapt to and withstand evolving environmental challenges. Fortis also plans to explore opportunities related to renewable gas solutions and invest in liquefied natural gas infrastructure in British Columbia as part of its commitment to sustainable energy solutions.

Lastly, Fortis is keen on accelerating investments in cleaner energy infrastructure across the various jurisdictions it serves.

Fortis president and CEO David Hutchens said: “Our Board of Directors declared a fourth quarter dividend representing a 4.4% increase that will mark 50 years of consecutive increases in dividends paid.

“This makes Fortis one of only two companies listed on the Toronto Stock Exchange to reach this significant milestone.”