JPM | US Energy: Qatari LNG Vesells Hit, Teapots Return, July Rebound in China Imports, PBOC Buys Most Gold Since 2023, Idea: Buy VST Call Spreads, Themes into OFS Earnings, China Scraps NEV Tax Breaks, CATL Safety Permits

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JPM | US Energy: Qatari LNG Vesells Hit, Teapots Return, July Rebound in China Imports, PBOC Buys Most Gold Since 2023, Idea: Buy VST Call Spreads, Themes into OFS Earnings, China Scraps NEV Tax Breaks, CATL Safety Permits

d with a final decision up next. Ultimate accounting treatment, including whether any regulatory asset

adjustment flows through adjusted EPS, remains a key item to monitor within 2Q earnings. Elsewhere, a settlement at

Empire Kansas and new filings at New York Water and Empire Arkansas advance the broader rate case cycle. On re-

domicile, the IRS private letter ruling process continues, and we expect management to discuss index inclusion and cross-

border tax benefits driving EPS uplift opportunities. All in, we estimate 2Q26 adj EPS of $0.05, matching the Street

median and prior JPMe, and establish a Dec-27 C$10 PT.

• FTS: AZ execution top of mind. AZ regulatory execution and large load progress drive investor focus in 2Q. On the TEP

rate case, hearings concluded in May, with closing briefs and reply briefs following in late July and late August,

respectively. With new rates requested effective September 1st, a post-election slip remains possible in our view. Two ACC

commissioners (Thompson and Meyers) face primaries this summer, introducing potential composition risk ahead of the

final order and potential implications for formula rate durability and the pace of regulatory lag reduction at TEP, where

~US$700mm of rate base remains outside current rates. The AZ IRP filing, previously targeted for August, may slip to

October following an APS extension request. On AZ large load, the initial 300 MW ESA advances using existing capacity

with no incremental capital required, while negotiations for an additional 300 MW at the first site and 500–700 MW at a