Fortis Inc.'s Q1 2025: Key Contradictions on Tariffs, Customer Growth, and Regulatory Impact

Impact of tariffs on capital plan, progress with large customers in Arizona, impact of government policies on rate plans, load growth opportunities, and progress with data center opportunities are the key contradictions discussed in Fortis Inc.'s latest 2025Q1 earnings call.



Strong Operational and Financial Performance:
- Fortis Inc. delivered earnings per share of $1 for the first quarter of 2025, representing a $0.07 increase over the same quarter last year.
- This growth was driven by successful execution of the capital plan, investing $1.4 billion in utility systems, and constructive regulatory outcomes in British Columbia.

Capital Investment and Rate Base Increase:
- The 2025 capital plan is on track with 27% invested in the first quarter, focusing on transmission investments at ITC, resource transition in Arizona, and infrastructure improvements across utilities.
- The company expects rate base to increase by approximately $14 billion to $53 billion by 2029, supporting average annual rate-based growth of 6.5%.

Concerns and Mitigation of Tariff Impacts:
- Fortis is mindful of potential impacts from tariffs and other macroeconomic factors but does not anticipate significant near-term impacts on the 2025 capital plan.
- The company plans to recover higher costs through normal regulatory mechanisms and focuses on ensuring customer affordability.

Pipeline of Growth Opportunities:
- Fortis continues to pursue incremental investment opportunities, especially at ITC and Tucson Electric Power, with significant projects like the MISO LRTP Tranche 2.1 and load interconnection projects underway.
- These opportunities are expected to support future growth and customer load demand, particularly in sectors like data centers and manufacturing.