Ladies and gentlemen, good morning and welcome to the Dominion Energy Fourth Quarter Earnings Conference call. At this time, each of your lines is in a listen-only mode. At the conclusion of today’s presentation, we will open the floor for questions. [Operator Instructions] I would now like to turn the conference over to Mr. Steven Ridge, Vice President-Investor Relations. Please go ahead, sir.

Good morning and welcome. Earnings materials including today's prepared remarks may contain forward-looking statements and estimates that are subject to various risks and uncertainties. Please refer to our SEC filings, including our most recent Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q for a discussion of factors that may cause results to differ from management's projections, forecasts, estimates and expectations. This morning, we will discuss some measures of our company's performance that differ from those recognized by GAAP, reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measures, which we are able to calculate are contained in the earnings release kit. I encourage you to visit our Investor Relations website to review the earnings conference call materials, including the earnings release kit. The Investor Relations team will be available after today's call to answer any questions. Joining today's call are; Tom Farrell, Chairman, President and Chief Executive Officer; Jim Chapman, Executive Vice President, Chief Financial Officer and Treasurer; as well as other members of the executive management team. I'll now turn the call over to Jim.

Thank you, Steven and good morning. Let me start by saying that we have a lot of ground to cover on today's call, which reflects the exciting progress we are making on our investment program, our financial targets and on our ESG efforts including the introduction of an enterprise-wide net zero emissions initiative. Over the last several years, Dominion Energy has transitioned into a larger, more regulated and more predictable company and this is reflected in our ability to extend our track record of delivering financial performance consistent with our guidance. I'm pleased to report on slide 3 that the fourth quarter of 2019 was the 16th consecutive quarter of achieving operating earnings per share that adjusted for normal weather met or exceeded the midpoint of our guidance range. Quarterly operating earnings were $1.18 per share, which includes a benefit from better-than-normal weather of less than $0.01. Even without adjusting for weather this was still the 16th consecutive quarter of results that align with our guidance range. 2019 full year operating earnings of $4.24 also exceeded the midpoint of our annual guidance range of $4.15 to $4.30 per share. When adjusted for about $0.02 of help relative to normal weather, these operating earnings for the year met the midpoint of our annual guidance range and represent a 5.5% increase over 2018 weather-normalized operating EPS. GAAP earnings for the quarter and for the year were $1.32 and $1.73 per share, respectively. Recall that full year reported results were materially impacted during the first two quarters of the year by charges associated with the SCANA merger, including a substantial customer refund as approved by the South Carolina Public Service Commission. Adjusted for these merger and integration-related costs, our trailing 3-year aggregate GAAP earnings are actually higher than our total operating earnings over…

Thank you, Jim, and good morning. First, a reminder that safety is our first core value. On slide 14, we have recast our historic safety results to incorporate our mergers with Questar and SCANA. As you can see, the overall trend reflects a continuous focus on employee health and welfare. Pro forma for past mergers, our company-wide OSHA recordable incident rate decreased in 2019 for an 11th time over the last 13 years. Turning now to our consistent national leadership as it relates to environmental, social and governance matters. Over the course of the last year, we have intensified our efforts to reduce emissions of all types. As shown on slide 15, we have already reduced carbon emissions by around 50% since 2005, which is nearly twice as much as the most recently reported industry average. We have followed a similar path for methane emissions, which have fallen by around 25% since 2010, a significant reduction driven by industry-leading efforts. Further as shown on the next slide. We have reduced coal-fired generation's contribution to company-wide electricity production by 80% from 52% in 2005 to 12% in 2019. And we estimate that coal-fired generation today accounts for less than 8% of our total regulated investment base. Turning to slide 17. I'm pleased to announce a new commitment to achieve net zero emissions by 2050. The goal includes both carbon dioxide and methane emissions and covers all of our businesses including electricity generation and gas infrastructure. This represents a significant expansion from the company's previous greenhouse gas emission reduction goals, which included a commitment to cut methane emissions from our natural gas operations by 50%, between 2010 and 2030, and carbon emissions from our power generating facilities by 80%, between 2005 and 2050. Reducing emissions as fast as possible and achieving net…

Thank you. Ladies and gentlemen, at this time, the floor is open for questions. [Operator Instructions] Our first question comes from Shar Pourreza with Guggenheim Partners.

Hey good morning guys.

Good morning.

Thanks for the additional disclosures on the ACP slides. With the AFUDC rate versus returns once gas is flowing, can you just elaborate if you're expecting any sort of step down there in your assumptions? I guess what returns are you kind of assuming in your $0.20 to $0.25 per share contribution once the pipes in service post these contract negotiations? And curious, if these negotiations built-in any potential further cost increases?

Sure. Good morning, it's Jim. Thanks for that. Yes, there has been as we said in our prepared remarks quite the substantial discussions with the anchor customers, the anchor shippers. And those discussions don't really revolve around ROE. It revolves around a rate. So, what the guidance we've given is, is for the first full year of operation at that rate. And that will of course imply an ROE, which folks can do the math on, but it's reflective of the expected rate for the anchor shippers. Now, when you do calculate that ROE that's implied by that math, you'll get to a number that is reflective of the first full year of operation only, meaning over time, as that project expands through laterals or compression or whatever, that's not reflected in that year one ROE, but the -- that will all flow from the input, which is a agreed upon customer rate and cost.

Got it. And then, is there a point in time, Jim, that you can sort of update us on laterals and compression? Is there -- and then where is sort of your intentions are there at that point?

No. What we can say is that, we are optimistic that there will be expansions over time. Sorry, this is Diane Leopold. But we're right now focused on getting the base project in.

Okay, got it guys. This was terrific. Thanks so much.

Thanks Shar.

Thank you.

Thank you. Our next question comes from Greg Gordon of Evercore ISI.

Thanks. Good morning.

Good morning

Tom I may have -- you covered a lot and you've made a ton of progress. So congratulations. I don't recall, if you mentioned, whether you think there'll be any substantial legislative activity in Virginia this year? And if so, what we should be monitoring?

Thanks, Greg. We mentioned two things in particular, the legislation that would allow for up to 1,500 diesel school buses to be converted to electric between now and 2025. And there are bills in both the House and Senate that are working their way through. Today is what we call Crossover Day in Virginia, where each of the Houses has to finish work on its own bills. So, the House has to finish work on all House bills and then everything goes over to the Senate, they can no longer work on House bills after tonight. And the same is true for the Senate. So, there are bills on the electric school bus in both houses. And there are bills related to providing even further regulatory clarity around our 2.6 gigawatt offshore wind farm. Other than that Greg there's been a large amount of legislative activity, some bills are no longer viable others are. And we just are monitoring all those working on them. Until they work their way through the legislative process. It's really -- it's premature to comment on them.

Great. And what would be -- what's your expected -- how do we reword this. What would be the outcome that you would expect coming from the legislation with regard to offshore wind if it does pass and what type of regulatory framework would that entail?

Well, again Greg I just -- the bills are there pending and I think they speak for themselves. They have language in them that increase regulatory clarity.

Okay. Thank you, all. I will go take a read. Appreciate it. Take care.

Thank you.

Thanks, Greg.

Thank you. Our next question comes from Michael Weinstein with Crédit Suisse.

Hi, guys.

Good morning.

Good morning. Hey. What impact of the FERC MOPR have on Virginia the offshore wind projects? And what is your, I guess, your decision process at MEPCO versus an FRR on tariffs?

Michael, it's Jim. Let me start there. We -- as we mentioned look we don't expect that that MOPR as proposed will have really any financial impact on Dominion. As you know our capacity and load in Virginia -- Dominion Energy Virginia is pretty well balanced. So no near-term impact. And if we foresaw that some change with MOPR and PJM rules would mean that we would not be potentially receiving capacity payments on new build generation. We could very easily in the interest of our customer -- customers in Virginia just elect that FRR option which we think is pretty straightforward. It already exists for another utility in the Virginia regulatory framework so we just don't see FRR the MOPR in general being an impact to our business one way or the other.

Okay. So for now I mean I guess later on you might make that election if it does impact the ability to bid into the auction for the offshore wind correct?

Correct.

One other question. The $8 billion for ACP is a little higher I guess you're at the high end of the range now. What are some of the factors that are pushing that up towards the high end of the range? Is it the Buckingham issue or something else?

Hi. This is Diane Leopold, again. So we run a lot of scenarios incorporating where we are with permitting issues and based on the timing of that, construction scenarios certainly including Buckingham compressor station options. And all of those have been taken into account in the customer negotiations that are factoring into revised rates. But really that's what took us to the $8 billion which is in line or just above the high-end of that judicial option range.

Okay. Got it. Thank you very much.

Thank you.

Thank you.

Thank you. This does conclude this morning's conference call. You may disconnect your lines and enjoy your day. Thank you.