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For the three months ended
"Our financial and operational results in 2016 - our first fiscal year operating exclusively as a regulated utility - demonstrate the strength of our long-term infrastructure investment strategy," said
Hamrock noted that
- Investing a record
$1.5 billionin its gas and electric utilities. This includes replacing 406 miles of priority pipe across seven states, 12 percent more than in 2015, driving continued reductions in leaks, outages and emissions. In addition, NiSourcereplaced 60 miles of underground electric cable and 1,205 electric poles, increasing electric reliability.
- Completing significant regulatory initiatives supporting system modernization, including gas base rate case settlement approvals in
Kentucky, Marylandand Pennsylvania(a settlement was reached in Virginiain January 2017); approvals of settlements in a long-term electric modernization program and electric base rate case in Indiana; and tracker updates in several states.
- Opening a new modern field employee training center in
Pennsylvania, and beginning construction on training centers in Ohioand Virginia. Construction of a Massachusettsfacility begins in 2017.
Northern Indiana Public Service Company's(NIPSCO) future electric generation strategy, as well as advancing NIPSCO's two major electric transmission projects.
- Committing to further reduce greenhouse gas emissions as a founding member of the
U.S. Environmental Protection Agency'sMethane Challenge Program.
2017 Earnings Guidance, Financial Commitments Reaffirmed; Capital Budget Increased
This expected investment level keeps the company on track for sustained execution on the
Consistent with our financial commitment to grow our dividend,
Additional information for the year ended
Fourth Quarter 2016 and Recent Business Highlights
During the fourth quarter, NiSource continued execution on its well-established, customer-focused infrastructure modernization investments. Together with regulatory initiatives and enhanced customer programs, these investments are improving how we deliver for customers, communities and investors.
Gas Distribution Operations
- New rates became effective
December 19, 2016at Columbia Gas of Pennsylvania(CPA) following Pennsylvania Public Utility Commissionapproval in October 2016of a joint settlement agreement in CPA's base rate case. The approved settlement supports the company's continued upgrade and replacement of its infrastructure, and allows recovery of increases in the company's safety-related operating and maintenance costs. The new rates increase CPA's annual revenue by $35 million, and the settlement includes incentives to expand gas service to commercial customers.
January 12, 2017 Columbia Gas of Virginia(CVA) reached a settlement with all parties to its base rate case pending before the Virginia State Corporation Commission(SCC). The settlement, if approved as filed, would allow for a $28.5 millionannual revenue increase. CVA filed the rate request in April 2016, seeking to adjust its base rates to recover investments that improve the overall safety and reliability of its distribution system. The case also supports the growth of CVA's system driven by increased customer demand for service. CVA implemented updated interim base rates, subject to refund, in September 2016. On February 8, 2017the hearing examiner recommended approval of the settlement without modification, and an SCC decision is expected in the first half of 2017. Columbia Gas of Kentucky(CKY) implemented new base rates on December 27, 2016following Kentucky Public Service Commissionmodification and approval of its base rate case settlement. The approval includes an annual revenue increase of $13.1 million, and supports continued system modernization and pipeline safety investments. Columbia Gas of Maryland(CMD) implemented new base rates on October 27, 2016following Maryland Public Service Commission(PSC) approval of a settlement agreement in its base rate case. The approval increases annual revenue by $3.7 millionand supports the continued replacement of aging infrastructure and increased pipeline safety investments. Columbia Gas of Massachusetts(CMA) implemented revised rates under its 2015 base rate case settlement. The settlement provided for a $3.6 millionincremental annual revenue increase, effective November 1, 2016, in addition to the $32.8 millionincrease that took effect on November 1, 2015. The settlement supports CMA's continued efforts to modernize its pipeline infrastructure and reduce emissions, while positioning its operations to continue to serve customers safely and reliably.
- NIPSCO continues to execute on its seven-year,
$824 milliongas infrastructure modernization program to further improve system reliability and safety. On December 28, 2016the Indiana Utility Regulatory Commission(IURC) approved NIPSCO's semi-annual tracker update covering $66.6 millionof investments that were made in the first half of 2016.
NiSourcecompanies also filed 2017 annual tracker updates related to their gas infrastructure modernization programs. This includes CMA under its Gas System Enhancement Program (GSEP), CVA under Virginia'sSAVE Act (Steps to Advance Virginia's Energy Plan) program and CMD under its Strategic Infrastructure Development & Enhancement(STRIDE) program. Combined, these filings provide for recovery of about $125 millionin capital investments focused on safety and reliability. The SAVE and STRIDE updates were approved in December. CMA expects a Massachusetts Department of Public Utilitiesorder prior to May 1, 2017, when the update is scheduled to be implemented.
November 1, 2016NIPSCO submitted its Integrated Resource Plan (IRP) to the IURC. The IRP outlines NIPSCO's plans to meet its customers' anticipated long-term energy needs. The NIPSCO team worked constructively with stakeholders to develop a balanced plan focused on providing customers affordable, clean energy while maintaining flexibility for future technology and market changes. Under the plan, NIPSCO outlined that the most viable option for the company would be to retire 50 percent of its coal-fired generating fleet, including Bailly Generating Station( Bailly) Units 7 and 8 as soon as mid-2018 and R.M. Schahfer Generating Station(RMSGS) Units 17 and 18 by the end of 2023. The Midcontinent Independent System Operator(MISO) has approved closure of Bailly Units 7 and 8 in mid-2018. Also as outlined in the IRP, on November 1, 2016NIPSCO requested IURC approval to invest approximately $400 millionin required environmental upgrades at its Michigan City Unit 12 and RMSGS Units 14 and 15 generating facilities.
- New rates became effective
October 1, 2016under NIPSCO's electric base rate case settlement, which was approved by the IURC on July 18, 2016. The settlement provides a platform for NIPSCO's continued investments and service improvements for customers, and increases NIPSCO's annual revenues by $72.5 million.
- NIPSCO is focused on executing on its seven-year electric infrastructure modernization program, which includes enhancements to electric transmission and distribution infrastructure designed to improve system safety and reliability. The IURC-approved program represents approximately
$1.25 billionof infrastructure investments to be made through 2022. The company began recovering on approximately $46 millionof these investments on February 1, 2017.
- NIPSCO's two major electric transmission projects remain on schedule with anticipated in-service dates in the second half of 2018. The 100-mile 345-kV and 65-mile 765-kV projects are designed to enhance region-wide system flexibility and reliability. Substation, line and tower construction are under way for both projects.
Investor Day Scheduled
As previously announced,
A live webcast with accompanying presentations will be available on www.nisource.com.
This news release contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to various risks and uncertainties. Examples of forward-looking statements in this release include statements and expectations regarding
Regulation G Disclosure Statement
This press release includes financial results and guidance for
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