NiSource, Inc.: Canada NDR Takeaways

Research evidence excerpt

NiSource, Inc.: Canada NDR Takeaways

Barclays | NiSource, Inc.

PA Regulatory Outlook: Management is meeting with the PA PUC in the coming week where we

think we’ll have a better idea of rate strategy going forward for the jurisdiction by the 2Q call.

PPL's rate case went broadly as expected – with the settlement approved – adding a de-risking

point to the jurisdiction, although we still see an overhang persisting for gas and water

companies that have yet to give their wider strategy. Overall, we think NI will begin to layer in a

more limited filing path, possibly targeting every other year GRCs (typically a serial filer) while

leaning on the DSIC in the meantime. Management noted while it doesn't see any immediate

risk, longer term it needs to still understand the regulatory outlook for the jurisdiction. NI has

kept O&M flat in the jurisdiction since 2016 and, if need be, given PA is 10-15% of consolidated

CapEx, management could divert capital away from PA and we do not currently see this as

creating a meaningful overhang for the NI story.

Indiana Remains Wide Open for Incremental DC Business: Management noted that while

there has been push-back nationally on data centers via various moratoriums at the county

level, 70 of the ~100 counties in Indiana are pro-DC. Local leaders, policy makers, and other

constituents understand the value of the GenCo in that what's been executed on thus far has

driven visibility to lower bills and – based on the current capital, load growth and commitments

at GenCo – management sees customers essentially getting 1 month of free service ($124/yr)

starting in 2032 (at full ramp) through the duration of contracts through 2042. Management sees

a clear upward bias here as it signs more deals, which it sees further resonating with policy