American Electric Power Company Inc (AEP) — Q4 2025 Transcript

Good morning, and welcome to American Electric Power Company, Inc.’s fourth quarter 2025 earnings call. A live webcast of this teleconference and slide presentation are on our website under the Events and Presentations section. Joining me today are William J. Fehrman, Chairman, President, and Chief Executive Officer, and Trevor Ian Mihalik, Executive Vice President and Chief Financial Officer. In addition, we have other members of our management team in the room to answer questions if needed, including Kate Sturgess, Senior Vice President, Controller, and Chief Accounting Officer. We will be making forward-looking statements during the call. Actual results may differ materially from those projected in any forward-looking statement we make today. Factors that could cause our actual results to differ materially are discussed in the company's most recent SEC filings. Please refer to the presentation slides that accompany this call for a reconciliation to GAAP measures. We will take your questions following opening remarks. I will now hand the call over to Bill.

Thank you, Darcy, and good morning, and welcome to American Electric Power Company, Inc.’s fourth quarter 2025 earnings call. I am happy to be here with all of you. We are operating in a period of incredible transformation across our industry, marked by accelerating electrification, rapidly expanding AI-driven and industrial demand, and rising expectations for reliable and affordable energy solutions. These trends only accelerated in 2025 and continued in 2026. As we look to the future, AEP stands out among its peers as one of the fastest-growing high-quality, pure play electric utilities strategically positioned in multiple high-growth regions. Let's begin on slides four and five of today's presentation. AEP is rooted deep in innovation, and we are ready to meet unprecedented customer demand across our impressive 11-state regulated service territory and beyond, resulting in significant infrastructure investment which continues to drive our strong financial performance now and into the future. We are operating in an environment and time when scale matters more than ever, and we continue to leverage our size to mitigate supply chain risk and focus on having the resources necessary to meet this massive system demand and investment opportunity. Notably, we are deepening our engagement with customers, regulators, policymakers, and suppliers to align our long-term goals and achieve favorable outcomes. For example, we have key relationships with major gas turbine manufacturers securing over 10 gigawatts of capacity and have entered into a long-term strategic partnership with Quanta Services to strengthen and accelerate capabilities for 765 kV transmission infrastructure buildout. Simply put, the AEP team has made significant progress in 2025. And as we look ahead, we have built a robust plan with a clear focus on operational excellence and accountability supported by the strength and experience of our winning team. I am very excited to share our progress with you today. Turning to slide seven and eight, I would like to first walk through our 2025 financial performance and share our outlook, then speak to our recent key accomplishments and continued focus on customer satisfaction and affordability. I will then hand things over to Trevor for a more detailed summary of our financial results and the growth trajectory of our business. Now on to our financial results. I am proud of the dedication and accomplishments of the entire team over the past year. AEP has a long history of consistently delivering or exceeding our earnings guidance and 2025 was no exception. We achieved fourth quarter 2025 operating earnings of $1.19 per share, bringing our full-year 2025 operating earnings to $5.97 per share, which is above the top end of our guidance range. In October, we also increased our quarterly dividend to $0.95 per share, demonstrating our ability to deliver competitive and sustainable shareholder returns. In fact, total shareholder return for 2025 was 29%, one of the highest in the industry. AEP’s execution-driven performance in 2025 has established a solid foundation from which we are reaffirming our 2026 full-year operating earnings guidance range of $6.15 to $6.45 per share. With the remarkable load expansion we are experiencing today, we are also reaffirming our premium long-term earnings growth rate of 7% to 9% for 2026 to 2030 with an expected 9% CAGR. We have a large but conservative $72 billion five-year capital plan yielding a 10% rate base CAGR that continues to present incremental upside and is supported by a strong balance sheet. In short, we finished the year with positive momentum, and we are only just getting started. Later in the call, Trevor will walk through our fourth quarter performance and provide additional details about our financial growth outlook. As we have discussed, we are in the midst of a generational load growth phenomenon throughout our diversified service territory, especially in Texas, Ohio, Indiana, and Oklahoma. We now have 56 gigawatts of firm incremental contracted load additions, doubling the 28 gigawatts we reported just last fall. These gigawatts are not speculative as they are all backed by signed customer agreements. However, meeting this demand must be done responsibly. It is critically important that costs associated with these large loads are allocated fairly and the right investments are made for the long-term success of our grid. AEP continues to work with federal and state leaders to quickly adopt reforms to streamline the connection of new energy resources to serve large loads and drive smart solutions to protect residential customers from extra costs. This builds on our progress over the last several years. We laid the groundwork two years ago when we secured commission approvals for data center tariffs in Ohio and large load tariff modifications in Indiana, Kentucky, and West Virginia. We now have pending tariff filings in Michigan, Oklahoma, Texas, and Virginia. A summary of these tariff filings can be found on slide nine of our presentation. This methodology is designed to help protect our existing customers from bearing the costs of grid improvements required to meet data centers’ energy demands. While this is good progress, additional measures must be taken to ensure that the infrastructure required to serve large loads is paid for by the customers who drive those needs. Beyond these efforts, we are also building on AEP’s history of innovation. We continue to explore generation solutions for the benefit of customers during this period of massive demand. We have previously talked about AEP’s ongoing efforts to develop small modular reactors, or SMRs, in our service territory. We announced that we are participating in the early site permit process for two potential SMR locations in Indiana and Virginia, and we will, of course, only move forward with the appropriate returns and risk mitigating structures. Additionally, last month, we announced plans to purchase $2.65 billion of fuel cells that will be part of a generation facility expected to be located near Cheyenne, Wyoming. The facility includes a 20-year offtake arrangement with a high-quality investment-grade third-party customer. Transmission will be equally important for affordability and to ensure new generation is quickly and reliably connected to serve large loads. Our unmatched scale on the transmission side continues to be a defining advantage for AEP. As outlined further on slide 10, we own and operate nearly 90% of the 765 kV infrastructure in the United States. With the largest electric transmission system in the country, AEP is exceptionally well positioned as the utility partner of choice for customers who need consistent large load power. As a matter of fact, AEP was recently recommended for approval or awarded new 765 kV projects in PJM, SPP, and MISO, expanding our footprint even further. New transmission projects and our planned fuel cell facility in Wyoming reinforce AEP’s growth trajectory, representing opportunities that include approximately $5 billion to $8 billion of confirmed or endorsed incremental generation and transmission projects. This is additive to our current $72 billion five-year capital plan just announced last October. Let me now touch on the progress we are making on the legislative and regulatory fronts for the benefit of our customers and communities. We remain focused on reducing the gap between our authorized versus actual ROE. In 2025, we achieved an earned ROE on the regulated business of 9.1%, up 30 basis points from two years ago with detailed plans to continue the improvement. Our successful approach of listening closely to state leaders, and aligning with their needs has resulted in the passage of improved legislation and the achievement of positive balanced regulatory outcomes that benefit both our customers and investors. Our continued execution is evident through several recent milestones all detailed in the appendix of today’s presentation, including broader regulatory accomplishments achieved in 2025. I would like to highlight a few of these key milestones. Legislation that reduces regulatory lag was approved in Ohio, Oklahoma, and Texas. I&M achieved approval on a generation resources filing enabling targeted resource additions through an efficient streamlined process. Base rate cases in Arkansas, Kentucky, and Ohio were approved or settled with additional new base rate cases recently filed in Oklahoma and Texas. Kentucky Power’s investment in our Mitchell plant was approved, extending interest in its energy and capacity beyond 2028. And in West Virginia, we continue to work with leaders at all levels of the state on fair financial returns as the state’s energy strategy aims to attract more capital investment and triple electricity generation to 50 gigawatts by 2050. While there is no statutory timeline for the commission to rule on the reconsideration filing made last September, we expect the decision soon. Affordability is at the heart of our regulatory approach, and as summarized on slide 11, we are taking decisive action to keep customer bills as economical as possible. We are building on efforts to support incremental load growth with innovative rate design while also mitigating residential rate impacts through our focus on O&M efficiency and effective financing mechanisms such as securitization. As we invest in this electric infrastructure growth cycle, and assign the appropriate cost to new large loads, we remain focused on protecting residential customers from increased costs. To finish up, we are seeing rapid change in our industry as well as increased need and demand from our customers and communities. We have a clear strategy, a strong financial foundation, and a team that knows how to deliver, all coming together to help us capitalize on the unprecedented opportunities ahead for the grid. I am dedicated to AEP’s vision of improving customers’ lives with reliable, affordable power. I am also committed to leading AEP for many more years to come. I look forward to working with our incredible team. We will continue to execute at an unmatched pace on behalf of our stakeholders to drive growth, serve our customers, and create value for our investors. I will now turn the call over to Trevor, who will walk us through fourth quarter financial performance and provide more details surrounding our growth.

Thanks, Bill, and good morning, everyone. As you have heard, AEP delivered an exceptional year of performance in 2025. Our year-to-date results exceeded expectations, supported by industry-leading load growth fundamentals, constructive regulatory and legislative developments, and disciplined execution of our robust plan with affordability front and center. I am pleased to walk through our progress today. I will start with the key earnings drivers behind our 2025 performance, and build on Bill’s comments regarding load growth. From there, I will provide additional context around our $72 billion base capital plan. I will then highlight the incremental projects that have been identified beyond the base plan. And finally, I will close with remarks reinforcing our continued commitment to our operational and financial strength that positions us to deliver long-term value for our customers and investors. Please turn to slide thirteen and fourteen of the presentation. Our 2025 full-year operating earnings was $5.97 per share, exceeding the high end of our guidance range of $5.75 to $5.95. This strong performance in our regulated segments was due to constructive rate case outcomes across many of our jurisdictions, steady progress on our transmission investment program, and the continued momentum in the load growth across our service territory, which I will speak more about shortly. These positive drivers were partially offset by additional spending on system reliability improvements, higher depreciation from our growing capital base, and interest expense. We also continue to see meaningful performance in our Generation & Marketing segment, driven by favorable energy margins and the benefits we realized from contract optimization within the portfolio. Turning to Corporate and Other, the year-over-year variance was largely due to a $0.06 per share tax benefit recognized in 2024 from updated state tax apportionment. As Bill noted earlier, our 2025 performance continues to give us confidence in our financial plan, and we are reaffirming our 2026 guidance and our long-term earnings growth outlook through 2030. As we turn to sales trends on slide 15, you will note that 2025 was a transformative year for AEP. Our total system sales exceeded 200 million megawatt-hours for the first time in AEP history. This milestone highlights the historic load growth we are seeing on our system, with what we anticipate will be even more incredible opportunity ahead of us. Retail sales grew 7.5% in 2025 compared to 2024, driven by significant commercial and industrial sales growth of nearly 10%, primarily from data centers in Indiana, Texas, and Ohio, as well as industrial sales in Texas. Comparatively, residential sales grew approximately 3% in 2025 across our footprint, mostly attributable to I&M and SWEPCO. Keep in mind that our revenues are supported by these rising sales growth trends and further strengthened by minimum demand charges included in our large load customer agreements. So while total retail sales rose 7.5% in 2025, corresponding revenue was up 8.3%. Turning to slide 16 and the future. We have previously discussed our forecast of 28 gigawatts of incremental contracted load growth by 2030. Today, we increased and doubled that outlook by 28 gigawatts to 56 gigawatts of incremental load. This step up reflects our continued success in converting projects from our planning queue into binding financial commitments. The increase to 56 gigawatts over our prior disclosure is driven by growth in ERCOT, PJM, and SPP. In PJM, contracted load increased by 4 gigawatts driven largely by activity in Ohio. This growth continues to be reinforced by data center development and, importantly, about 90% of the incremental PJM load is supported by executed take-or-pay electric service agreements, or ESAs. We are also seeing positive momentum in the region in Oklahoma, where contracted load has grown by 1 gigawatt driven primarily by a commitment with a large aluminum smelting customer. Together, PJM and SPP account for the 5 gigawatts increase in our contracted load outlook. Let me turn to ERCOT because the Texas story remains a central part of our long-term growth outlook. As a transmission and distribution utility, AEP Texas does not directly bill retail customers in ERCOT. We secure contracted load through letters of agreement, or LOAs. Under these agreements, customers must secure land, complete and pay for interconnection studies, provide detailed load forecasts, and importantly, fund all of the construction costs. This structure ensures that only viable and financially backed projects advance into AEP’s forecast, supporting greater confidence in our long-term load additions. Within AEP’s 56 gigawatts of identified incremental load, AEP Texas has signed LOAs for 36 gigawatts with large industrial customers, well-capitalized hyperscalers, and mega-size data center developers. This is a significant increase of 23 gigawatts since October, and all of these new loads meet Senate Bill 6 criteria outlined on slide 17. As implementation of this legislation progresses in Texas, we anticipate improved clarity and certainty around the timing of when additional loads will connect in ERCOT. As such, AEP is well positioned to build the transmission and distribution infrastructure that Texas needs, and investment timing will be influenced by resource availability to support growing system load. We will continue to update our load forecast throughout the year as we support and benefit from the rapid economic growth in Texas. Please turn to slide 18. I want to take a moment to ground us in the foundation of our capital plan and the opportunities ahead. We built our forecast using relatively conservative assumptions which gives us a lot of confidence in our ability to deliver and creates opportunity for upside as conditions evolve. For example, our $72 billion five-year capital plan is based on the 28 gigawatt incremental demand outlook we shared last fall. As we continue to see new opportunities materialize across our service territory, the capital plan will continue to expand. Just since the third quarter call, we have seen upside of approximately $5 billion to $8 billion of confirmed or endorsed generation and transmission projects in the period of 2026 through 2030 that are in addition to the base capital plan. I would like to emphasize that any capital related to the incremental load outlook, which has increased by an additional 28 gigawatts, is additive to our $72 billion plan and is not part of the $5 billion to $8 billion of capital upside. As I have articulated on prior earnings calls, we want to have a cadence of updating the capital plan annually in the third quarter. This timing allows us to run the full plan through our modeling process and provide a view of the associated financing needs. That said, given the size and rapid growth of the incremental opportunity, we felt it was important to highlight some investments that have come into the five-year window. We will provide additional clarity on these opportunities, formally update our capital plan, and address the associated financing as we have a greater line of sight.

We have a plan that is supported by tangible upside and is designed with affordability considerations for our existing customers. We are confident in our ability to advance this critical work of building a resilient, modern grid that will help power the economic growth in our service territory, including the rapidly expanding AI-driven and industrial demand. Now moving to slide 19. I want to highlight the key takeaways that reflect the steady progress we are making in both operational and financial execution and reiterate some of the themes you heard today. First, today, you heard that our positive results in 2025 give us strong confidence in the financial commitments we have laid out. We delivered performance that exceeded our 2025 operating earnings guidance, which supports our conviction in reaffirming the 2026 guidance range and the long-term earnings growth rate. Second, you heard that we have increased our load forecast to 56 gigawatts of additional contracted load by 2030, all backed by signed customer financial agreements. This is real committed load, much of which is under take-or-pay large load tariff agreements and positions us to advance the critical infrastructure customers and communities will rely on for decades to come. Third, you heard that our capital plan remains relatively conservative with approximately $5 billion to $8 billion of confirmed or endorsed projects incremental to the $72 billion base capital plan. And continued acceleration of load growth could also support further expansion. Fourth, you heard that we remain committed to maintaining a healthy balance sheet. This is endorsed by our FFO to debt target of 14% to 15%, and we currently exceeded this target with S&P at 15.2% as of year-end. Comparatively, our Moody’s FFO to debt is just under 14%, underscoring our commitment to balance sheet strength. Our diverse high-growth footprint also provides the flexibility to deploy capital efficiently in direct support of customer needs, regulatory priorities, and long-term shareholder value. This disciplined approach ensures we can prioritize high impact projects and maintain financial strength as we execute at scale. Finally, you heard that along with large-scale infrastructure investment execution, we continue to work closely with our stakeholders to advance regulatory strategies to keep customer affordability top of mind. This includes our data center and large load tariff filings and our focus on O&M efficiency. Taken as a whole, these actions reinforce a balanced approach that supports affordability while advancing critical investments needed to meet the growing customer demand. I am excited by the momentum we have built over the last year, and I am confident in the discipline we are bringing to our execution. We are delivering on our robust plan guided by a high-quality, seasoned leadership team that has come together to leverage AEP’s size and capabilities, resulting in strong operational and financial performance. With unmatched infrastructure assets and deep expertise, I believe AEP is exceptionally well positioned to build the critical infrastructure our country needs to support unprecedented growth. I am extremely proud to be part of an organization with this much opportunity. We really appreciate you taking the time to listen to our prepared remarks. I am now going to ask the operator to open the line so that we can take your questions.

Hey, guys, good morning.

Good morning, Bill. So just quickly, I mean, obviously, you guys have doubled your signed contract load since the last update. You are seeing very healthy demand from large load customers, especially in Texas. Can you just maybe give us a small inkling, even kind of directionally, on what this could mean to the CAGR? I mean, could this put upward pressure on the current 9% or when you look to roll forward, especially as you continue to sign additional ESAs? So I guess could the CAGR be a 3Q update in addition to CapEx and funding? Thanks.

Shar, it is Trevor. I appreciate the question. Yeah. Look. I think the good news here is the $72 billion five-year capital plan does not include this incremental load growth of 28 gigawatts. And we really tried to articulate that we think the $72 billion is somewhat conservative, and that is why we did want to come out with this incremental $5 billion to $8 billion that we have line of sight to. I do think what we will do is on the first quarter call, when we have a little bit of greater line of sight around the five to eight, we will come out with some more definitive ideas around how we are going to finance it and what that ultimately means to the growth rate. But the bigger question that you are asking on the 28 gig, that probably will be more around the third quarter call as we formally put forward our revised capital plan and run it through our internal processes. However, if we see some big chunks like we have with this five to eight that are meaningful, we may address those on the second quarter call as well. But I would say keep an eye out on the formal process. We really are trying to stick to the cadence of doing this once a year. But with this much load growth that we are seeing, I think it was really important for us to come out and at least give the street some line of sight into what this really means for us. Good news also, though, is with this 28 gigs, that gets us up to the 56, we still have 180 gigs plus in the queue, in various stages of development. And so even while we upsized the interconnection queue up to 56, we did not lower the 180 gigs, just because we are seeing that much growth on the system. And so I think, you know, what that really means is you will see a greater line of sight beyond 2030 as we continue to deploy capital into the next decade or past this decade into the next decade. But, again, I would say let’s see what we can pull together by the first quarter call and then ultimately what the formal process generates on the third quarter call.

Got it. Yeah. I know it is pretty amazing growth. I mean, just I know, Trevor, I know and Bill, the ESAs have been sort of under sort of a bit of a microscope with investors. I mean, I guess, talk a little bit about the protections and the level of confidence there. And the reason why I ask is, you know, we have at least seen one data center pull out of a project due to local pushback, and that was despite having sort of a signed ESA in place. Just maybe talk about the level of confidence there because it has obviously been on the microscope with investors.

Yeah. And this is Trevor again, Shar. So from that perspective, again, what gives us a great deal of confidence is that 180 gigs that are backing any of those firm ESAs that are in the load right now. But we do actually a pretty good job of really distilling down those loads on our system to ensure that they are backed by financially secure and very committed counterparties. And then, as you know, the ESAs have a take-or-pay component, and the large load tariffs that we have pioneered lock those counterparties in place to ensure that the dollars that are spent are not going to be detrimental to our existing customers. So, we feel very, very good about where we are under the ESAs and even the LOAs in Texas. You know, given how SB 6 is really trying to ensure that only those loads that are very committed are advancing. And that is where we are at, and that is why we feel good about coming out with this 28 gigs incremental on top of the 28 that were there. And so from our perspective, we feel very, very secure in the 56.

And then, Shar, I will add that with our service territory predominantly being more on the rural side, we are actually having very good success with our local communities and the desire to host this type of economic development. Obviously, we have a few here and there that we need to do more work with. But the thing I love about AEP’s footprint is the diversity of the assets that we have and the locations that we have and the desire across many of those locations to get this economic development built and built as quickly as we can. And so in addition to what Trevor had with regards to the contractual side of this, I love how our teams are attacking the need to build those community relations and working with our individual states and really delivering what they want.

Got it. Big congrats to both of you. I mean, the turnaround has been nothing short of amazing.

Yeah. Thanks, Shar.

Hey, Bill. Trevor. So just on the LOA, is there any more kind of color that you can provide on, I know that people are making significant commitments, but I guess in the scale of the value of making sure you are kind of in the kind of SB 6 queue, what the, you know, how much risk there might be that these are just options being put on the table and, you know, it is worth putting a decent amount of money for an option as opposed to really committed project. I do not know if that makes sense as a question, but just wanted to get a sense of, like, the scale of commitment relative to the scale of these projects.

Yeah, Steve.

Again, we try to articulate just our confidence in all of this in the prepared remarks. But, again, what we are seeing is a big chunk of what is coming in in ERCOT is around the data center load, which is a lot of hyperscalers and data center developers. You know, more than 50% of that load is now hyperscaler load. And so these are counterparties that are significantly committed to their place in the queue and putting dollars at risk. And so we feel very good about that. And then, again, with the amount of capacity in the backlog that is not even in the 56, if anyone were to walk away or just have a financial holding position, we feel we could backfill that very, very quickly. So all of that gives us a great deal of confidence in these LOAs in Texas. Right. Roughly, there is, I will call it, almost $5 billion associated with those projects. It is about $2.7 billion of transmission projects in SPP, about $1.5 billion in PJM, and about a half billion in MISO. That all adds up to kind of the $4.7 billion, or close to $5 billion, of transmission projects that have either been awarded or kind of assigned to us. And then you layer on top of that the $2.7 billion associated with the Bloom fuel cells that we announced under the 8-K, and that gets you to roughly $7.4 billion of the breakout of the five to eight that we talked about.

And, Steve, I would add that with our transmission business, the huge advantage we have, of course, is that we operate 90% of the 765 system in this country and are by far the leader in that voltage level. And with our exceptional partnership we have with Quanta, we are the preferred provider of these projects. And so again, as Trevor laid out, I am very excited about our future in this area and our ability to win these projects and deliver on them, particularly with our push to acquire the components that we need well ahead of time. And our size matters in this area because we are out ensuring that we have the equipment that we need, we have the contractor that we need, we have the capabilities that we need to deliver on these projects. And so I really love where we sit from a competitive position.

Great. Thank you. That makes a ton of sense. Thank you.

Hey. Good morning, team. Trevor, Bill. Nice to chat with you guys. Appreciate it.

Hey, Julien. Good morning.

Just following up maybe in the same vein here with Steve. You know, how do you think about this contracted generation business in as much as Bloom seems a little step away from the core rate base opportunity? Again, obviously, PJM’s reevaluating its own construct here. They’ve got backstopping they are considering. How do you all think about the prospects for contracted generation to effectively backstop and serve some of this 56 that you guys are talking about here, you know, in terms of whether that is PJM or more in Wyoming? How do you think about that almost as an adjacent business segment, whether that is scaling up with Bloom beyond this commitment or whether that is something adjacent in a more traditional gas context.

Yeah. Thanks for that question. And for us, it is really about serving our customers and arriving at solutions for them to get them connected as quickly as we possibly can. And in many of these cases, where the grid connect could be out for a couple of years, we have been able to offer to them the capabilities of bringing the data centers online significantly faster through deals like the Bloom Energy deal and perhaps the deployment of batteries and some other opportunities. And so I see this as a significant customer service that we are providing to them to support what they ultimately want to do and need to meet their business requirements. So I am very excited about where we sit on this. I like the deals that we have done with Bloom. It is clearly a proven technology that can be deployed relatively quickly. And so I see it as very complementary to the rest of our business and we will continue to provide those services to the customers as they need it.

And, Julien, let me just also add one thing on this is as we have said in the 8-K, this is a long-term agreement with a very creditworthy counterparty. And so from our perspective, that long-term contracted cash flow off of a material asset like this is very, very important for us, and to me, it is very similar to a regulated return because here you have a very high-quality counterparty signing a 20-year PPA agreement. And ultimately, you do not have to go in for a rate case every so often on this, and it is very, very positive for us.

Yeah. No. Indeed. And then with respect to PJM, any comments on that front? As how you think about tackling it? And that could be an Ohio-specific thought process as you think about engaging this year and future years. Or frankly directly with PJM. Again, to the same vein as serving your customers, right, under this contracted generation effort.

We are deeply engaged in PJM as well as SPP and MISO. Obviously, the secret sauce on all of this is figuring out methodologies to speed up connecting generation to load. We are fully in support of the administration’s work on trying to solve this issue in PJM and to find ways to accelerate that process. And so our teams are working directly with a variety of stakeholders on all of this, and I am hopeful that we will find paths forward that will allow for this to be expedited. The thing for us is we are super prepared for this. We have the equipment we need. We have the contractors we need. And so once we get through the processes at the RTO, the beauty of that is it falls back on us to execute, and I am absolutely confident in our team that we will execute once we can start digging the holes.

Awesome, guys. I will leave it there. Thank you very much.

Good morning.

Morning.

Let us see. Looking at the 36 gigawatts here that you have got in ERCOT, I was just wondering, are there physical constraints in the grid to consider with all that load coming on by 2030, or labor constraints? I guess, what needs to be done from a transmission investment perspective to actually make sure that it can all come on?

Yeah. Really good question, and that goes right to the heart of the thing I believe in most, which is execution around this organization. And as our teams are looking at the requirements to deliver these projects for our customers, we are getting well ahead of the equipment supply and the contracting supply that we need to ensure that we are able to deliver on these projects. Now we know the demand on this is real. The timing will depend on the SB 6 implementation, and some of these could potentially move around. But we are making sure we have the capabilities and resources in place to deliver on these in accordance with what our customers are demanding. And that is fundamental to our business. So I feel very comfortable with where we are at in that regard. We will obviously continue to adjust as the SB 6 implementation moves in and out. But I can guarantee you our team is all over this.

Got it. That is helpful. Thanks. And obviously, a big inflection, big step change upward here in the ERCOT activity that you are seeing. I was wondering also on the 180 gigawatt overall queue that you have of load, is that also heavily weighted toward ERCOT? Or how is that split where you are seeing the incremental progress on the margin across your service territories?

Yes. Generally, David, what you are seeing is in that roughly 180 gigs, call it roughly about 70 gigs is in ERCOT. And then you have got about 20 to 25 gigawatts in AEP Ohio, and then about 30 gigawatts in PSO and another 30 gigawatts in APCo, and then 16 in I&M. So you can see it spread around very well around the core states that we have talked about around our growth. And those four states around the growth tend to be Texas, Oklahoma, Ohio, and Indiana.

Got it. Super helpful. Thanks so much.

Yeah. Absolutely, I will let Kate take that question.

Hi, Carly. Good morning. So in G&M in the fourth quarter, it is really two drivers. We had strong performance with margins in our retail business. And then in our wholesale business, a number of contracts moved in and out of contracts, so, you know, contract optimization in that business. We do expect some of that to continue into next year. You saw when we released our guidance at EEI, we would still expect that same level of performance for G&M for next year.

Yep. Thanks, Carly.