WECエナジー・グループ 2026年第3四半期決算説明会：EPSガイダンスを引き上げ、475億ドルの資本計画

要点

• WECエナジー・グループが発表した2026年第3四半期の希薄化後1株当たり利益（EPS）は1.18ドルとなり、2025年第3四半期の0.83ドルから0.35ドル増加しました。温暖な天候、設備投資、および営業効率の向上増益に貢献しました。
• 経営陣は、年内の天候が平年並みで推移すると仮定し、2026年通期のEPS予想を従来の5.51〜5.61ドルから5.60〜5.64ドルへと引き上げ、レンジを縮小しました。
• 同社は2027〜2031年に向けた475億ドルの設備投資計画を発表しました。これは従来計画から100億ドル（26%以上）の増加となります。増加分の大部分は、超大型顧客（VLC）の需要に関連しています。
• 2026〜2031年の電力需要予測の伸びは、1ギガワット増の4.9ギガワットに拡大しました。計画には、I-94地域での3.2ギガワット、バンテージ（Vantage）データセンター拠点での1.3ギガワット、および別の見込み顧客向けの400メガワットの需要が含まれています。
• WECは、この新計画により、当初の2026年予想の中央値である5.56ドルを基準として、2031年までに総資産ベースの年平均成長率（CAGR）13.4%、年率7%〜9%超のEPS成長が支えられると見込んでいます。
• 経営陣は、EPSの成長加速に伴い、配当性向が60%〜70%に推移すると予測される中、6.5%〜7%の増配を見込んでいます。

主要財務データ

事業および業績ハイライト

公益事業部門はEPSを前年同期比で0.28ドル押し上げました。投資の拡大は0.19ドルの貢献となり、そのうち0.15ドルは建設中プロジェクトに係る建設中利子（AFUDC）自己資本分および現金リターンの増加によるものです。これら増加したリターンのうち0.12ドルはVLC対応プロジェクトによるものでした。また、VLC顧客はマージンを0.02ドル押し上げ、良好な日常の運用・保守（O&M）費用が0.08ドルのプラス貢献となりました。

これらのプラス要因は、減価償却費、支払利息、税金などの増加により一部相殺されました。アメリカン・トランスミッション・カンパニー（ATC）は四半期EPSを0.03ドル押し上げ、エネルギー・インフラストラクチャー部門は前年同期比で0.02ドルの増加に貢献しました。

天候要因調整後の小売り電力販売量は、VLC需要に牽引され4.1%増加しました。VLC顧客と鉄鉱石鉱山を除くと、販売量は0.4%増となりました。WECは、通期の天候要因調整後電力販売量が2025年とほぼ同水準（横ばい）になるとの予想を維持しています。

マイクロソフトのマウント・プレザントにおけるデータセンター開発は、引き続き主要な需要牽引役となっています。WECは2031年までにI-94地域で従来計画を600メガワット上回る3.2ギガワットの需要に対応できるよう準備を進めています。経営陣は、現在の計画には3.2ギガワットが組み込まれているものの、ウィスコンシン州南東部の需要が最終的に4.5〜5ギガワットに達する可能性があると試算しています。

バンテージ・データ・センターズ（Vantage Data Centers）はオラクル向けの施設を開発しており、WECの2031年までの予測には1.3ギガワットが含まれています。経営陣によると、この拠点は将来的に3.5ギガワットまで拡大する可能性があるとのことです。オラクルは、ウィスコンシン州のVLC料金制度に基づく財務保証要件を満たしています。

同社はまた、別の見込み顧客向けに400メガワットを計画に含めました。経営陣は、現時点でこの需要は1社によるものと見込んでおり、詳細については地域社会、送電網、および容量の検討状況に依存すると述べています。

設備投資計画と資金調達

475億ドルの設備投資計画では、規制対象の発電および送電事業を重視しています。WECは従来計画と比較して、コンバインドサイクル発電プロジェクト、燃焼ガスタービン、既存設備のアップグレードを含め、天然ガス発電に68億ドルの追加投資を計画しています。

再生可能エネルギー発電および蓄電池設備への計画投資額は、純額で11億ドル増加しました。蓄電池投資が30億ドル増加した一方で、太陽光および風力発電の計画支出は、2026年に完了した工事を一部反映して19億ドル減少しました。

規制当局の承認を条件として、WECはポイント・ビーチ原子力発電所からの約1,000メガワットの脱炭素ベースロード容量に関する電力購入契約（PPA）を20年間延長することも計画しています。

アメリカン・トランスミッション・カンパニー（ATC）のプロジェクトへの投資額は、2027〜2031年の合計で従来より12億ドル増となる約53億ドルに達する見込みです。また、この計画には、シカゴの配管更新プログラムを含む電力および天然ガス配電インフラ向けに10億ドルが追加されています。

設備投資計画全体の約45%（200億ドル以上）がVLC関連投資に割り当てられています。経営陣は、2031年までにVLC専用資産が総資産の約30%を占めるようになると見込んでおり、電力事業が資産ベースの80%を占める見通しです。

WECは5年間で260億〜270億ドルの営業キャッシュフローと、ハイブリッド証券を含む190億ドルの追加負債を見込んでいます。普通株式による調達額は、100億ドルの投資増額にもかかわらず、従来計画からほぼ横ばいの約55億ドルにとどまる見通しです。経営陣は、建設期間中の現金リターンの増加とプロジェクト稼働に伴うキャッシュ創出がその要因であるとしています。

業績予想（ガイダンス）

WECは、年内の天候が平年並みで推移すると仮定し、2026年のEPS予想を5.60〜5.64ドルへと引き上げ、レンジを縮小しました。経営陣によると、このレンジは調整後の2025年予想の中央値から7.7%のEPS成長を意味します。

2027〜2031年について、経営陣は当初の2026年予想の中央値である5.56ドルを基準として、EPSが年平均7%〜9%超で成長すると見込んでいます。同社は、規制当局の承認によりプロジェクトが前倒しで進展すれば、「超」の部分は2028年または2029年に適用される可能性が高いと述べています。また経営陣は、予期せぬ重大な事態が発生しない限り、5年間のCAGRは9%の上限に達する可能性があると示唆しました。

同社は6.5%〜7%の増配を見込んでいます。正式な2027年の業績および配当予想は12月に発表される予定です。

リスクと注視すべきポイント

• 複数の主要な発電・送電投資には規制当局の承認が必要であり、これがプロジェクトの実施時期やEPS成長における「プラスα（超）」要素の実現可能性に影響を与えます。
• ATCは、E-STATCOMシステムを含むバンテージ拠点を支援する送電プロジェクトの提案を再提出しました。経営陣は申請手続きが2026年中に完了すると見込んでおり、承認後の工期は約12〜15ヶ月と試算しています。
• 2027年および2028年のウィスコンシン州における料金改定申請は審査中であり、年内に最終決定が出される見込みです。イリノイ州では、推奨命令案においてピープルズ・ガス（Peoples Gas）およびノース・ショア・ガス（North Shore Gas）の自己資本利益率（ROE）を9.48%、自己資本比率を50%とすることを提案しており、最終決定は12月に予定されています。
• 経営陣によると、資金調達計画には金利上昇が織り込まれているとのことです。計画の実行はまた、190億ドルの追加負債を調達しつつ、健全な信用指標を維持できるかどうかに依存します。
• 建設リソースの制約により、イリノイ州の一部のインフラ工事の拡大が減速しています。経営陣は、同地域における年間支出が2028年頃から約5億ドルに増加すると見込んでいます。
• 2031年に予測される資産ベースの30%近くがVLC顧客に対応するものとなる見込みです。WECは、自社のVLC料金制度により、これらの顧客にフルコストのサービス費用負担と財務保証および信用補完を義務付けていると述べました。

アナリストQ&Aの要点

アナリストは、WECの成長見通しの上方修正のタイミングと持続可能性に強い関心を寄せました。経営陣は、プロジェクトの承認と資金投入のペース次第で、2028年または2029年にEPS成長率が9%を超える可能性があると述べました。さらなるデータセンターの拡張や将来の設備投資計画の更新により、2031年以降も新たな機会が追加される可能性があります。

資金調達について、経営陣は、非現金収入であるAFUDCに主に依存するのではなく、建設中工事から現金リターンをもたらすVLCプロジェクトが増える見通しであると説明しました。計画では、VLC顧客からの事前支払いは想定されていません。現行計画を超える追加投資については、自己資本による調達比率が従来の約50%という枠組みから低下し、40%程度になる可能性があると経営陣は試算しています。

経営陣は、マイクロソフトが複数の建設拠点を進行中であり、土地取得を継続していることから、現在、計画需要に対してより大きな短期的な上振れ余地を提供していると述べました。オラクルとバンテージは、現在の予測に含まれる初期の670エーカーの第1期および1.3ギガワットに引き続き注力しています。

WECはまた、追加される1ギガワットの需要を満たすには、MISO（中部独立系統運用機関）の要件を充足するために約1.4〜1.5ギガワットの供給力が必要であることを明確にしました。したがって、100億ドルの設備投資計画の増額には、2032年および2033年に及ぶ需要に向けた発電、送電、配電、および一部の長納期機器が含まれています。

決算説明会トランスクリプト全文

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決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Good afternoon, and welcome to WEC Energy Group's conference call for the third quarter 2026 results. This call is being recorded for rebroadcast. [Operator Instructions] In conjunction with this call, a package of detailed financial information is posted at wecenergygroup.com. A replay will be available approximately 2 hours after the conclusion of this call.

Before the conference call begins, please note that all statements in the presentation, other than historical facts, are forward-looking statements that involve risks and uncertainties that are subject to change at any time. Such statements are based on management's expectations at the time they are made. In addition to the assumptions and other factors referred to in connection with the statements, factors described in WEC Energy Group's latest Form 10-K and subsequent reports filed with the Securities and Exchange Commission could cause actual results to differ materially from those contemplated. During the discussions, referenced earnings per share will be based on diluted earnings per share, unless otherwise noted.

And now it's my pleasure to introduce Scott Lauber, Chairman, CEO and President of WEC Energy Group.

Scott Lauber

Good afternoon, everyone, and thank you for joining us today as we review our results for the third quarter of 2026. Here with me are Xia Liu, our Chief Financial Officer; and Beth Straka, Senior Vice President of Corporate Communications and Investor Relations.

As you saw in our news release this morning, we reported third quarter 2026 earnings of $1.18 per share compared to $0.83 per share in the third quarter last year. These results were driven by warmer-than-normal weather, execution of our capital plan and operating efficiency. With another solid quarter, we remain on track to deliver strong results for 2026.

Our continued focus on the fundamentals of our business is creating value for our customers and stockholders. Today, we're raising and narrowing our earnings guidance for 2026 to a range of $5.60 to $5.64 per share, assuming normal weather for the remainder of the year. This reflects 7.7% growth in earnings per share from our 2025 adjusted guidance midpoint.

As a reminder, our previous guidance was in the range of $5.51 to $5.61 per share. I'm also pleased to share our new 5-year capital plan. Let's start by talking about the economic growth that's driving it. Overall, we expect our demand -- our electric demand to grow 4.9 gigawatts between 2026 and 2031, an increase of 1 gigawatt compared to the prior plan.

Microsoft continues to make good progress on its large data center complex in Mount Pleasant, Wisconsin, with the first facility operating Construction is underway on additional facilities as Microsoft expands at the site. As a reminder, Microsoft has purchased more than 2,200 acres to date in the I-94 corridor south of Milwaukee. Just last week, Microsoft announced its purchase of an additional 70 acres next to the site.

We are preparing to serve forecasted demand of 3.2 gigawatts in the I-94 region through 2031, with opportunity for further expansion. That's up 600 megawatts from the previous plan. You'll notice an additional 400 megawatts in the new capital plan. We're making good progress with another customer, and you can expect more details in the future. Stay tuned.

And to the north of Milwaukee, you'll recall that Vantage data centers is developing facilities for Oracle on approximately 1,900 acres. Construction continues on the initial phase of the data center project, which is being built on 670 acres. Vantage said that it expects to invest $15 billion to complete the phase in 2028. We currently have 1.3 gigawatts of demand for this Vantage site in our forecast through 2031.

Looking to the future, it has the potential to reach 3.5 gigawatts of demand over time. The project is well on its way and Oracle has met its financial security obligations, which are consistent with the Wisconsin Commission's very large customer tariff requirements. To serve this project, ATC has refiled a proposal with the Public Service Commission of Wisconsin.

In addition to the transmission line, this filing includes proposed investment in an E-STATCOM system to maintain grid reliability. ATC is working through the process now with the commission. As a reminder, both Microsoft and Oracle have committed to paying their full share for energy costs.

We solidified this through our very large customer tariff, which protects other customers. Microsoft, Vantage and Oracle have made significant investments to support our communities. Just recently, we worked with Oracle to save our customers an estimated $300 million in fuel costs. Oracle agreed to subscribe to a portion of the energy we purchased from Point Beach Nuclear Power plant. We expect the full details to be submitted to the Wisconsin Commission in the coming months.

As we work with these hyperscalers, we are confident our very large customer tariff provides a strong framework for growth while maintaining affordable energy service for all our customers. We continue to see local growth in small commercial and large businesses as well. For example, both [ Janeric and Boden ] are expanding and adding jobs. We have designed our new capital plan to reliably serve our customers while supporting the significant growth we continue to see across our service areas.

As you may have seen from our announcement this morning, we expect to invest $47.5 billion in capital projects between 2027 and 2031. This is an increase of $10 billion or more than 26% above our previous 5-year plan. The majority of this increase is being driven and therefore paid for by our very large customers. The updated plan is expected to support asset-based growth at a 13.4% compound annual growth rate. This should drive compound annual earnings per share growth of 7% to 9-plus percent from 2027 to 2031. This is based off the midpoint of our original 2026 guidance.

The increase in our plan is mostly driven by investments in regulated electric generation and transmission largely due to very large customer demand. Let me give you a few more details. Over the next 5 years, we'll continue to take an all-of-the-above approach for generation to support economic growth and reliability by investing in new natural gas, batteries and renewables.

And dispatchable generation is a key component of our reliability strategy. Between 2027 and 2031, we expect to invest an incremental $6.8 billion in modern, efficient natural gas generation versus the prior plan. This includes a combined cycle turbine project that we expect to come online by the end of the 5-year forecast period as well as combustion turbines and upgrade to our existing facilities.

We are increasing planned investment in renewable generation in battery storage by $1.1 billion, with the total planned battery storage increased by $3 billion, while planned solar and wind investment decreased by $1.9 billion. Some of this decrease relates to the work already completed in 2026.

Continuing our all-of-the-above approach, we also reached an agreement with NextEra that pending regulatory approval, will support long-term electric liability and customer savings. We plan to extend our purchase power agreement for approximately 1,000 megawatts of carbon-free baseload capacity from the Point Beach Nuclear Plant. The new PPA would extend the existing agreement by 20 years.

Outside of generation, American Transmission Company plans to continue investing in transmission capabilities to serve our region's economic growth, connecting new facilities and strengthening the system. Our plan calls for us to invest approximately $5.3 billion in ATC projects between 2027 and 2031. This represents a $1.2 billion increase from the previous plan.

Adding to strength and reliability and support economic growth, we continue to invest in our electric and natural gas distribution networks. Our plan includes an additional $1 billion to improve distribution infrastructure. This supports the continued investment in our pipe retirement program in Chicago. Recall the Illinois Commerce Commission directed us to focus on retiring more than 1,000 miles of older pipe by January 1, 2035.

Now turning to the regulatory front. I have a couple of updates across our service area. In Wiscantan, progress continues on the rate request we filed in April for forward-looking test years 2027 and 2028. The procedural calendar has now been completed. We expect final orders from the commission by the end of the year with new rates effective in January '27 and 2028. We also have rate filings under review in Illinois for test years 2027 at Peoples Gas and North Shore Gas.

Recently, the administrative law judge issued a proposed order that is largely consistent with the [ SAS ] recommendation. The order recommends a 9.48% ROE and a 50% equity ratio at both utilities. We expect the final decision in December. Of course, we'll keep you updated on future developments. In summary, we're excited about the strong economic development in our region. And we believe our capital plan, along with our very large customer tariff positioned us well to support that growth. Now I'll turn it over to Xia for more details.

Liu Xia

Thank you, Scott. Our third quarter 2026 earnings of $1.18 per share reflects a $0.35 increase compared to the third quarter of 2025. Our earnings package includes a comparison of third quarter results on Page 15. I'll walk through the significant drivers.

Starting with our utility operations, earnings were $0.28 higher versus the third quarter of 2025. Let me highlight a couple of factors. Weather favorably impacted quarter-over-quarter earnings by approximately $0.05. Compared to normal conditions, we estimate that weather had an $0.08 positive impact in the third quarter of '26 compared to a $0.03 positive impact in the third quarter of 2025.

Rig-based growth contributed $0.19 to earnings. This includes $0.15 of growth from incremental AFUDC equity and cash returns associated with projects under construction.

I'll note that $0.12 or 80% of these incremental returns are from projects for and supported by the VLCs. In addition, VLCs added $0.02 of margin quarter-over-quarter. And favorable day-to-day O&M drove an $0.08 variance. This was primarily driven by our stock-based plans, which could be timing. These positive drivers were partially offset by higher depreciation and amortization expense higher interest expense and tax and other items.

Next, let me provide some additional color on our weather-normal retail electric delivery. Compared to Q3 last year, total weather-normal retail electric sales grew 4.1%, driven by growth from the VLCs. Excluding the iron ore mine and VLC customers, we saw sales growth 0.4% during the quarter. For the year, we continue to expect weather-normalized electric sales to be relatively flat with 2025.

At American Transmission Company, Capital investment growth contributed an incremental $0.03 to Q3 earnings compared to 2025. At our Energy Infrastructure segment, earnings were $0.02 higher in the third quarter compared to the same period in 2025. This was driven by additional capital investment at [ We Power ] and a better operating income at [ Waki ].

Lastly, that earnings from the Corporate and Other segment increased $0.04 driven primarily by tax timing. In terms of common equity, we lapped in about $1.16 billion during the first 9 months of the year. This includes $50 million issued under our dividend reinvestment and employee benefit plans. The remaining $1.1 billion are under the ATM program, which includes approximately $350 million from forward contracts that have been settled and $765 million still under forward contracts that will be settled in the future.

As Scott noted, we are raising and narrowing our 2026 earnings guidance range to $5.60 to $5.64 per share, assuming normal weather for the rest of the year. Going forward, with the updated capital plan, as Scott discussed earlier, we expect our long-term EPS growth to increase. Again, based off the midpoint of the original 2026 guidance range, $5.56 per share, our long-term EPS CAGR is expected to be 7 to 9-plus percent through 2031.

Now let me comment on the financing plan that supports this growth and the new capital plan. Slide 22 of the earnings package outlines the funding sources. Over the next 5 years, we expect to generate $26 billion to $27 billion in cash from operations, funding more than half of our cash needs.

We expect $19 billion to come from incremental debt, including hybrid instruments, and we plan to fund the remaining cash needs with [indiscernible] to $5.5 billion of common equity.

Although our current capital plan increased $10 billion, we expect common equity needs to remain relatively flat with the prior plan. This is largely due to incremental cash from operations in the new plan. As projects are completed and placed in service in the planning horizon, they begin generating cash revenues. Many of which are supported by the VLCs that comes with a 10.48% to 10.98% ROE. The new plan also includes more projects for which the VLCs are expected to provide cash returns during construction rather than AFUDC.

The additional cash from operations helps us keep common equity needs at a modest 10% of total cash sources and relatively flat compared with the prior plan. In closing, a Scott discussed previously, strong economic development and load growth in Wisconsin are the foundation of our new capital plan.

As illustrated on Page 21 of the earnings package, over the next 5 years, we expect to transform our business while staying true to our fundamentals. Our asset base is expected to more than double over the next 5 years with the electric business representing 80% of the asset base by 2031.

Furthermore, with almost half of the capital plan or more than $20 billion allocated to the VLCs, the asset base dedicated to lead customers is projected to represent almost 30% of our total assets by 2031. As you know, these assets are supported by the VLC tariff, which is designed to ensure that these large customers pay their full share of the costs and are not subsidized by other customers. In addition, the tariff provides very strong financial security and credit support requirements. We are excited about our company's future and the investment opportunities ahead. With that, I'll turn it back to Scott.

Scott Lauber

Thank you, Shaw. Finally, a quick reminder about the dividend. As usual, I expect we'll provide our 2027 dividend plan and earnings guidance in December. We expect to grow the dividend at a rate of 6.5% to 7%, consistent with our past practice. This results in a projected payout ratio of 60% to 70% -- 60% to 70% due to the forecasted earnings per share growing at a faster pace. .

Before I open it up for Q&A, I want to summarize some of the key highlights of the call. Economic growth is driving another gigawatt of forecasted demand for a total 4.9 gigawatts of growth in our plan. This growth is adding $10 billion to our 5-year capital plan, which is now at $47.5 billion. These developments give us confidence in our EPS compound annual growth rate of 7 to 9 plus percent.

We remain committed to 6.5% to 7% dividend growth. We expect the total equity funding to be flat in our 5-year plan versus the 5-year plan at approximately $5.5 billion, maintaining a strong balance sheet. Overall, we're optimistic about our 5-year plan and the longer-term outlook. We look forward to discussing our plan at the EEI conference. Operator, we're now ready for the question-and-answer portion of the call.

Operator

[Operator Instructions] The first question is from the line of Shar Pourreza, with Wells Fargo.

質疑応答

Shahriar Pourreza

Just the updated guidance, obviously, you now see 7% to 9% plus. Just help us frame what is assumed in the plus? That's always the question mark you get when you come out with the plus. The $10 billion is included in the range. But just help us frame the plus and obviously why [ you even keep ] the 7% to 8% at this point?

Scott Lauber

Sure. Sure. It's a great question. And as we look at it and we look at the capital projects we have and you saw our growth of another gigawatt, we felt really confident with that 7% to 9% range and feel confident not only in this 5-year plan that we think it will continue. The second part is when you think about the plus, you really got to look at the pattern of our growth of our capital plan that's illustrated in our handout.

There's a lot of projects that need regulatory approval. But if there's an opportunity that we can get the approvals and move faster than we anticipate, there's an opportunity that the growth may be a little faster in a couple of years, maybe like in '28 or '29. So it really depends on a lot of stuff, but I think there's an opportunity as we continue to execute on plan for potential upside in some of those years.

Shahriar Pourreza

Got it. No, that's perfect. That's what I was trying to get into. That's perfect. And then, Scott, switching to Oracle, the ATC line project to serve the Vantage side in its second application filing. It appears the filing is still under review with the commission. So I guess what's the time line there? And do you see a potential delay to the start of the project or can the site start taking the megawatts before the line is completed?

Scott Lauber

So great question. And they're still working feverishly on the construction. So listening to the Oracle conference call, the last quarter, I don't think it's going to delay any of their projects in the time line. We expect we'll get a complete this year, and it will get approval, and we'll be right back on schedule.

Just to put it in perspective, I mean, remember, this filing is a big filing. In addition, we just added the [ E STATCOM ] to the filing to make sure we have true transparency. When you think about it, there's over 20,000 pages in the filing. So the commission having 35 questions, I think that's pretty reasonable. So it's really a complete filing and understand we wanted to ask those questions upfront and work it through so we can get a quick result here. So everything is on schedule here, although we had a little pause with that refiling, I feel good where we're at.

Operator

Your next question is from the line of Nicholas Campanella with Barclays.

Nicholas Campanella

I just wanted to ask, you're raising the capital plan pretty significantly, and this is for about 1 gigawatt of incremental load in the forecast period. You also talked about progress with another customer. You also talked about the fact that Microsoft and Oracle could be expanding. Just does this capital plan build into that load? Or would those expansions result in incremental capital?

Scott Lauber

Sure, sure. And when you look at it, there'll be potential expansions. We factored in the 400 megawatts on this to be announced, and we're making progress on those customer -- on that customer there. But we do have some long lead time equipment in here anticipating we'll have some spending done, but those megawatts probably won't come in until like a 2032, '33.

But true transparency. We think this growth will extend beyond 2031 and opportunities in 2032 and '33. So we have a little bit of long lead time equipment, as you can see in some of the public filings of [ plans ] being filed. So more to come on that. So I think as we grow, there will continue to be upside if there's additional data center growth beyond 2031.

Nicholas Campanella

Okay. And then just with the plan being out to 2031 now, you talked about the long lead time equipment, and you still have some chunky generation, you're probably going to be building in 2032. You also have some load ramping by then how do equity needs look like kind of beyond this plan? Just is there something idiosyncratic that's causing you to basically have flat-to-declining needs on the CapEx raise? Or is this type of CapEx increase to equity needs sustainable on a roll forward, if you understand my point.

Scott Lauber

Yes, it's a great question, and I'll start and then Xia will back clean up as we're in the brewer fever here. When you think about it, we really worked hard getting more cash upfront and getting some cash returns with some of our very large customers. And as we always said, having [ plants ] still into service was also going to help with our cash.

So this was kind of a step change to get into that realign our cash needs and working with our very large customers who have been great partners here. As we go forward, though, Xia has looked at what additional capital would mean and potential there.

Liu Xia

Yes. So just to build on that, we think that we traditionally guided you that every $1 million of incremental capital will require $0.50 with equity content with the factors that Scott just outlined, we expect that number to come down over time. So I would be comfortable to say it could be around 40%. So every incremental dollar would come with 40% of equity content comfortably.

So that would be the going forward guidance for you, Nick.

Nicholas Campanella

If I could just squeeze 1 more in just in response to kind of Shar's question before on the plus, just is it really with the capital plan essentially peaking here in '28. Is is '29 and beyond that you'd really be in that plus range if things go correctly. We're just trying to make sure we heard that right. I'm sorry.

Scott Lauber

Sure, sure. I think it all depends upon when we get the regulatory approvals, potentially '28, more likely '29. And as we continue, you can see our capital plan actually falls down a little bit in 2030 and '31. I wouldn't read too much into that because as we look at 2032, et cetera, there will be more opportunities there. So I felt the most confident in that '28, '29 time frame, but '30 and '31 aren't that far off. So we have some time here to look at those also.

Operator

Your next question is from the line of Stephen D’Ambrisi with RBC Capital Markets.

Stephen D’Ambrisi

Scott, just had a quick one -- a couple of quick ones. Just in terms of Microsoft and the 600-megawatt expansion to [indiscernible] load, can you just talk maybe at a high level about how much of the acreage that relates to or they keep adding acreage, but it also seems like power density per acre is moving up with newer generations of racks. But just how we can think about -- you've given a good estimate of what Vantage could potentially size to, but just interested about Microsoft on the other side.

Scott Lauber

Sure, sure. And Microsoft hasn't disclosed anything in particular, this is more us just looking at other comparable sites. I think those sites -- and they've talked about -- you just saw them buying another 70 acres right next door. I think the opportunity for these sites to have another -- not another, but in total, 4.5 to 5 gigawatts.

So right now, Southeastern Wisconsin is about 3.2 gigawatts, potentially that could get up to 4.5 gigawatts to 5 gigawatts. As you see, they just bought some more land. So I agree with you. I think the technology continues to get more capacity on the same location. So more to come on that, but those are just our kind of rough estimates. But right now, we're very comfortable with the 3.2 gigawatts that's in the plan for Southeastern Wisconsin.

Stephen D’Ambrisi

And then just obviously, more to come, I guess, on the 400 megawatts. But can you talk about whether it's within [ WABCO or WPS ] service territory? Or any color on just what that could look like? Understand that we'll get more details there.

Scott Lauber

Yes. We'll get more details too. I know people are looking at locations in both territories. So once again, you got to make sure you have a community that's excited about it and interested in it. You got to make sure the transmission lines are available and the capacity. So there's a lot of factors going in. So I don't want to really get much more there, more to come on this, though.

Operator

Your next question is from the line of Michael Sullivan with Wolfe Research.

Michael Sullivan

Sorry, I got to try 1 more -- Scott, I got to try 1 more on the growth rate. So is the takeaway here, the plus as it stands now is for 1, maybe 2 years and then you're back within more the [ 7 to 9 ] and all the other years?

Scott Lauber

So I feel good that we're going to get a couple of years out of here. But once again, we'll have another update in a year here on our capital plan or maybe interim as we get more customers here. So a little too early to tell, but feel really good that it'll be into that 9 plus probably the upper end or a plus sign based on where we're all at. .

Michael Sullivan

Okay. And on the equity piece, can you just maybe unpack a little more about what changed here for the nearer term that you were able to -- I mean because you really have 2 large customers. And so I guess there was a negotiation on -- with 1 or both that brought the needs down and then like why that wouldn't sustain if they -- if you expand with those same customers out in future years?

Liu Xia

Yes, Michael, I'll take that one. So remember, the tariff allows us to recognize AFUDC or current returns. So we have the options there. We've been assuming conservatively before that most of the projects would come with AFUDC. And in this plan, to your point, we've been working with our VOC customers to try to charge more cash returns.

So as a result, you're basically reducing the AFUDC originally assumed in the prior year plan and increasing cash returns in this plan. So it's kind of like a -- like Scott mentioned, it's a step change. So that's why it's -- that's why it's a relative equity even though we have added $10 billion.

Going forward, you wouldn't be doing this unwinding AFUDC and adding cash return thing, but we will continue to encourage the customers to pay cash returns. So incrementally, you would need a little more equity as a result. I don't know if that makes sense.

Michael Sullivan

It does. And the last thing just for me, the 400 megawatts, is that all with 1 customer? And then just any detail on the gating items there?

Scott Lauber

Sure. And right now, it's anticipated to be all with 1 customer. More to come on this. They're still working with the different communities on this. So it's anticipated to be with one customer, but more to come. .

Operator

Your next question is from the line of Andrew Weisel with Scotia Bank.

Andrew Weisel

Congrats to the Brewers, not a lot of love there, but quite a world series. Congrats to the brewers and congrats to you guys. They're not the only ones winning in Milwaukee. Great updates.

Scott Lauber

Thank you. Thank you. The Brewers have been exciting and fun to watch and glad to bring a World Series home..

That's great.

Andrew Weisel

So my first question is on the sales growth. You add a gigawatt to the outlook there and yet the forecast still shows 6% to 8%. Why wouldn't that be increasing the 6% to 8%? I understand there's a roll forward. But why didn't that number come up? And can you talk a little bit about why the pace of gas growth came down a little bit from the prior forecast? Is it all in Wisconsin, I believe, not Illinois. So could you please talk to the 2 numbers?

Liu Xia

Sure. Happy to. So on the first one, remember, we continue to add sales along the way between now and 2029. So when you look at '29 to '31, the base is very high. So when you grow from a very high base, you continue to have a 6% to 8%. So it's really just a timing of the growth rate.

On the gas sales side, nothing to read too much into it. We forecasted a pretty flat gas sales this year. And we -- through the 3 quarters, remember, we had a mild quarter in the first quarter and the next 2 quarters were really not gas focused. I mean our normalization process is never perfect. So there's a little bit of that in there, but we don't see any trend in the gas sales side to make us question the growth rate. So just don't read too much into it.

Scott Lauber

Yes. And remember, on the electric side, the very large customers are really -- remember the way our tariff is set up, the very large customers, you got to really look at the returns on the assets versus the volumetric. The volumetric does make a difference, but a lot of that volumetric is completely passed through as it relates to energy prices, et cetera. It's really the return on those assets is where the earnings come from. .

Andrew Weisel

Great. That makes a lot of sense on the electric side. Sorry, Shah for gas, I was talking about the '29 to '31 outlook. You're now saying 0.5%. You previously said [ 0.7 to 0.1 ]. Is it the same story about the '28, for '29.

Liu Xia

Yes, it's still in that neighborhood. As I said, from last year to this year, we're expecting that to be even -- so growing from that, we feel good about the 0.5 to 0.8. It could be better than that.

Scott Lauber

Yes. I think we're just making sure we factor in conservation where the price of gas be go factoring in what could happen. Usually, use per customer continues to go down a little bit. This is largely driven by customer growth. So I'm not too concerned about it. And remember on those gas sales, we'll factor all that into your rate cases as we look at it.

Andrew Weisel

Right. Good point. That's all rate case cycle away. Okay. Then 1 more on equity, if I may. How should we think about the timing of this? Your commentary on the magnitude and the customers was pretty clear. But given all of that, how should we think about the timing of when the equity would be drawn down? And common equity versus JASN within the cycle? Should it be ratable? Or would it be more back-end loaded within the 5-year plan?

Liu Xia

We always say that equity comes -- goes with capital. So it could be a little bit front-end loaded because we are still in the construction phase in the front end of the planning horizon. So again, as we continue to place the projects in service, you have more cash coming in, in the latter part of the plan. So overall, it's a little bit front-end loaded on the equity.

Operator

Your next question is from the line of Anthony Crowdell with Mizuho.

Anthony Crowdell

I reiterate Andrew's comments. Congrats on the World Series, must be nice. I think I wanted to follow up on Steve's questions earlier on Microsoft and Oracle. I think Steve was kind of talking on the Microsoft angle. I guess my question is between Microsoft and Oracle or Vantage, which customer has the greatest potential to exceed the load currently in your plan right now? And what would trigger that?

Scott Lauber

Sure. And that's hard -- I mean they're both building extremely fast. They're both going -- they're both have their construction sites under construction extremely fast here. So I think when you look at it, probably Microsoft has a lot more individual construction sites going. Oracle is really concentrated on that first 670 acres, really concentrated on that first 1.3 gigawatts. As you noticed, we didn't increase anything in the plan here. They want to get that up and running, get that transmission line. So I would say right now, potential Microsoft has a little more opportunity, especially as they continue to buy more land if you think of our current 5-year plan.

Anthony Crowdell

Great. And just one follow-up. I guess, it's on -- and I hope I have these numbers right, like customer concentration, I think by like 2031, nearly like 30% of your assets would be supporting very large customers. I mean, is there a point maybe. .

[Audio Gap]

Operator

Your next question is from Brian Russo with Jefferies. .

Brian Russo

Just a follow-up on like the cadence of the EPS growth. Is it kind of following the same pattern as the prior 7% to 8% and kind of follows the capital plan on Slide 22. But as the VLT generation investments ramp up, that requires in theory less equity because you're getting some upfront cash recovery from those customers? Is that how to think about it?

Scott Lauber

Yes, I would really go with the pattern of the capital plan, I think. And if we can do something and some more capital could come in a little earlier, I think there's opportunities to be in that plus section. So I would look at the capital plan because that's a return on those assets. .

And then the equity, as we've talked about, it's really a step change here to get more of that cash flow from our very large customers to stick to that balanced approach here. And then I think as you go forward, as we get more in service, the equity needs will continue to go lower.

Brian Russo

Okay. Understood. And then could you be more specific on the actual construction time needed for that ATC line. I could see on the CapEx, it looks like majority might be in '27 and '28. Just with the being complete CCN filing and refiling. I just want to make sure that there's adequate time, which is an already condensed time line for construction.

Scott Lauber

Yes. And I don't have the exact time line in my mind here. I imagine it's going to take 12 to 15 months. I have not fleshed that out completely. But I know American Transmission Company is ready. They have people working on other projects, so we're maintaining the workforce so that when this project does get approved, if we have to go ahead, we're ready to go with -- we have the equipment, just ready to go with the construction. So as soon as we get approval, there will be no delay [indiscernible], we're going to keep moving. So it's probably about 12 to 15 months.

Brian Russo

Okay. Great. And then lastly, any insights into this B&R environmental review following the Port Washington settlement, it seems like it's not an obstacle for this new 400-megawatt customer. Just wondering what you're hearing or seeing on the ground related to that.

Scott Lauber

Yes. So this environmental review. I don't see it as an obstacle at all. And actually, we kind of welcome having a reasonable environmental review to get the facts out. So having a study, getting all the clarity on the facts and the environmental impact, I think is positive. And hopefully, there's even clarity of what rules have to be filed for future environmental reviews.

So there's less interpretation. So we see this as net positive. It shouldn't affect any of the current sites. I think everyone thinks it's going to be very manageable. We expect the environmental review to be on a reasonable basis. It sounds like it should be done very quickly by beginning of '28. So I think all of that and having the facts out there and having the true on an environmental review is all net positive.

Operator

Your next question is from the line of Jeremy Tonet with JPMorgan.

Unknown Analyst

This is Diana Niles on the call for Jeremy.

If you could elaborate more on the relatively unchanged equity plan and maybe more broadly on the financing plan, [indiscernible] considering the allocation of debt equity under a higher rate environment, it would be possible to speak to that and potentially speak to rate exposure?

Scott Lauber

Sure, sure. And Xia will kind of look at how it's all laid out and some concepts here. But in reality, we kind of look at it every day, we're going to do some financing. What's the most efficient. So Xia, why don't you kind of lay out some of our base concepts?

Liu Xia

Oh, absolutely. so on the debt front, we are keenly aware of the increase in the interest rates and as a matter of fact, [Audio Gap] so we have taken into consideration all of that related to the cost of debt. On the equity front, I don't know if you have a specific question you wanted me to address? .

Unknown Analyst

I think that generally covers. That it was more or less the decision to increase the percentage of the debt in the financing plan while decreasing the percentage of equity, but understand the puts and takes there.

Liu Xia

Yes. It's all driven by the cash flow forecast. So as we pick up more cash from operations, and that could be in the form of current returns, as we talked about or incremental revenue in cash or selling the ITCs and PTCs whatever we do in the plan that increases the cash flows. That gives us the capacity to increase a little bit of the debt until maintain really strong financial metrics, credit metrics. It's really a function of the cash flows.

Unknown Analyst

Okay. Got it. if I may ask 1 more.

Scott Lauber

Sure.

Unknown Analyst

Are there any particularities to consider when it comes to cash inflows from VLC customers, either in terms of upfront payments or cash recovery when it comes to how the rating agencies look at your cash flow statements?

Liu Xia

In the plan, we're not assuming any of the upfront payment from the VLCs. We are assuming that they would pay cash returns on CWIP. So it would be really just like earning a return on the rate base. but nothing like upfront payment from the VLC.

Scott Lauber

But we think those cash returns and receivable receive positively from the rating agencies. I think they'll consider that very positive.

Operator

Your next question is from the line of Steve Fleishman with Wolf Research.

Steven Fleishman

Sorry for the double teaming question here. And congrats on the Brewers, by the way. Just to kind of tie up maybe some of the questions on the growth rate and CAGR. Instead of looking year-by-year or looking more at the 5-year CAGR? Is the plus on the table with the plan as it is for the 5-year growth rate? Or is the plus more representative of '28 or '29, so to speak?

Scott Lauber

So right now, I would say the plus is more representative of the '28 to '29, but feel comfortable over that 5-year growth rate, assuming we don't have any wild cards here would be at that upper end of the 9%.

Steven Fleishman

Got it. And then, of course, as you update plans, you probably fill in more in the latter parts as well.

Scott Lauber

Exactly. Exactly. As we update plans and give more clarity on a very large customer and very large customers...

Operator

Your next question is from the line of Carly Davenport with Goldman Sachs.

Carly Davenport

Just 1 quick one for me. Just on the capital plan. I think you quantified the amount of distribution and generation CapEx tied to the VLCs. Do you have a comparable number that you're sharing for the transmission piece of the plan?

Scott Lauber

I think in our plan right now for the transmission, specifically related to economic development is about $1.4 billion in our plan right now. So I think as you look across the state of Wisconsin, I think there's potential upside as more VLCs come in, it all depends upon how much -- of course, they're going to be substation, but what kind of transmission will be needed or their location of it. So right now, we only have $1.4 billion.

Operator

Your next question is from the line of Richard Sunderland with Truist Securities.

Richard Sunderland

Just one clean-up question on the VLC side, the disclosures there. That 29% asset-based component in 2031, does that include the 400 megawatts kind of unidentified customer and that longer lead time equipment, I think you called out for like a 2032, 2033 basis. Is that all in that 29%?

Scott Lauber

Yes, it is. Yes, it is. It's all a part that we think is going to be paid for by those very large customers, and that's all part of the 29%. .

Richard Sunderland

Then how that's informing kind of rate case discussions as well. Could you speak a little bit to the workflows there?

Scott Lauber

Sure. Sure. And so the Illinois -- and you've seen a couple of updates in our Illinois filing that the capital amount has gone down a little bit this year just because we're ramping up and it's been hard to get resources or some of the occupations since the economy is strong and there's a lot of construction progress going on across the country, largely in Wisconsin and other places also.

So it's been hard to ramp that up. We're beginning -- we've updated the forecast, trying to have that true transparency to the commission down there of the time line of that. But we're making really good progress. It's going to continue to ramp up and the plans in here ramp up to about $500 million a year spending starting in that '28 time frame as we continue to ramp. So making progress. It's been a little slower than what we'd like.

But we got to make sure we have the quality and the right resources to do it. And we've put in programs to help get new resources in by working with trade associations and other colleges and training to get more beginning workers up to speed to be able to help us on the program.

Operator

the final question will be from the line of Paul Patterson with Glenrock Association.

Paul Patterson

So my -- just to sort of follow up, and I apologize, but just trying to connect all the dots. The 1 gigawatt of demand and the $10 billion of CapEx incremental CapEx, the $10 billion, it sounds if I heard you guys correctly, the 1 gigawatt is not directly -- there's more than just the 1 gigawatt of demand because you're getting more demand that's not in the forecast period in 2032 and what have you. Am I thinking about that correctly?

Scott Lauber

So there's a combination. You have to -- we've got the -- we've got the 1 gigawatt of demand. That 1 gigawatt demand, we need to get about 1.4 gigawatts, 1.5 gigawatts to make sure we make the MISO requirement. So it's a little bit more to make sure we have the MISO requirements for that capacity need. We also have the transmission in there to serve this. That's up plus there's a little bit of long lead time equipment in addition to that, plus we have some distribution.

So significantly related to generation, but a lot of it's in or some of it is in transmission also and a little bit in this long lead time equipment. So kind of all of the above.

Paul Patterson

Okay. But most of that $10 billion is associated with VLCC customers.

Scott Lauber

That is right.

Paul Patterson

And could you guys just -- I saw the rate base pie charts and everything, but just in general, when we think about that incremental number, how much should we think about as roughly speaking, associated with the VLCC guys?

Scott Lauber

I think as you look about the $10 million increase, probably about $8 million plus is related to the VLTs. .

Liu Xia

And the entire 47.5% of the capital, about 45% is VLC. That's another way to look at it.

Paul Patterson

Of the total capital, not the incremental?

Liu Xia

Correct. .

Paul Patterson

Okay. And then when we -- and I think this question was answered, but you mentioned that really the OpEx differentials really have to do simply with Quip versus AFUDC. And there's no deposits or collateral or anything like that in that large CapEx, OpEx, excuse me, that large OpEx increase other than obviously some growth, but is that the way that might -- I understood that correctly?

Scott Lauber

So there is no like customer deposit or prepayment for that. It's all related to our current return on AFUDC. However, as you think of the credit requirements, we do if there's a credit requirement need, we do have letter of credits or whatever is required under the commission order to make sure we have the credit requirements met. So you got to think of 2 different ones. One is credit requirement and one is the cash flow to support it.

Liu Xia

And our credit department is just on the side for security, that's not part of our financials anywhere in the financials that we represent to you.

Paul Patterson

Awesome. And then I just noticed on the footnote on Page 20. Electric distribution includes $200 million in substations dedicated to VLCCs, a portion of which whatever. Is there any [ Kayak ] or anything in any of these things that we should be thinking about? Or is this pretty much minus any or contribution native construction or anything like that?

Scott Lauber

Yes. That's really just -- there's no contributions in that. That is just some miscellaneous distribution capital. We needed to serve some of the very large customers. That's dedicated We just want to make sure as you tie stuff out, you recognize that.

All right. Thank you. Well, thank you, everyone. That concludes our conference call today. Thank you for participating. If you have more questions, feel -- please feel free to contact [ Best Track ] at (414) 221-4639. Thank you. .

Operator

This concludes today's call. Thank you for attending. You may now disconnect.