NextEra Energy Inc (NEE.N): VA Governor to "Intervene" in Merger Approval Process; Expect Political Noise But Continue to Expect VA Approval

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06 Aug 2026 12:40:58 ET │ 10 pages

NextEra Energy Inc (NEE.N)

VA Governor to "Intervene" in Merger Approval Process; Expect Political

Noise But Continue to Expect VA Approval

CITI'S TAKE

In our view, the action by the Governor to play a role in the political

approval process and help push for rate payer benefits beyond what

NextEra has already announced was expected. We continue to expect the

$2.25B rate payer benefit target (across VA, NC, and SC) to increase, and

we continue to expect the merger timeline to be delayed ~6 months

(compared to company guidance) as the deal works through stakeholder

engagement and regulatory approvals.

VA Approval Outlook: In Virginia, utility bill affordability and datacenters continue

to be top political issues. A mega merger, with north of $2.25B of synergies, creates

a prime opportunity for politicians to push for political wins and appear to play a role

in getting additional ratepayer benefits. We have been arguing that this was likely to

happen since the original deal was announced in May 2026 (NextEra Energy Inc

(NEE.N) - Virginia Regulatory Approval Expert Event Takeaways; NextEra Energy Inc

(NEE.N) - Stars Align for Large Acquisition; Repositioning NextEra to

Growth). Ultimately, we believe the announced targeted ratepayer/customer

benefit number will go up (but we believe the parties were anticipating this when

the deal was announced). In addition, we have had the view that the transaction

was biased to be delayed ~6 months (NextEra Energy Inc (NEE.N) - Stars Align for

Large Acquisition; Repositioning NextEra to Growth) and the news today does not

change that timeline view.

Buy

Price (05 Aug 26 16:00)

US$85.91

Target price

US$102.00

Expected share price return

18.7%

Expected dividend yield

3.0%

Expected total return

21.7%

Market Cap

US$179,206M

Ryan LevineAC

Xinru Yin

What Does Intervening Mean? The Governor will formally request to a party in the

case but will not play a role in deciding the case. This gives the Governor an

unprecedented voice in the regulated utility process. In a politically influenced

commission, in our view, the commission will have a greater mandate to encourage:

…