PPL Q2 2026 Earnings Report

PPL EPS Results

• Actual EPS: $0.33
• Consensus EPS: $0.34
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: $0.32

PPL Revenue Results

• Actual Revenue: $2.11 billion
• Expected Revenue: $2.19 billion
• Beat/Miss: Missed by -$79.19 million
• YoY Revenue Growth: +4.20%

PPL Announcement Details

• Quarter: Q2 2026
• Date: 8/7/2026
• Time: Before Market Opens
• Conference Call Date: Friday, August 7, 2026
• Conference Call Time: 11:00AM ET

PPL (NYSE:PPL) is an energy company that owns and operates electric transmission and distribution infrastructure and provides related customer services. The company’s core business centers on delivering electricity to residential, commercial and industrial customers through regulated utility operations, maintaining grid reliability, responding to outages and managing customer billing and account services.

PPL’s activities include construction and maintenance of distribution and transmission lines, meter and grid management, and programs to support energy efficiency and the interconnection of distributed resources. The company also invests in grid modernization initiatives—such as system hardening, automated outage restoration and technologies to accommodate renewables and distributed generation—to improve reliability and operational efficiency.

Headquartered in Allentown, Pennsylvania, PPL traces its roots to the region’s legacy electric utilities and has focused operations serving customers primarily in the United States, with an emphasis on regions where it maintains regulated utility franchises. As a regulated utility provider, the company operates within state and federal regulatory frameworks that shape rates, capital investment and service obligations.

PPL is managed as a utility-focused enterprise that balances investment in infrastructure and customer service with regulatory oversight. Its operations are oriented toward delivering reliable electricity and supporting transition efforts in the energy sector while complying with applicable environmental and safety standards.

PPL Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: PPL reaffirmed its 2026 earnings outlook of $1.90–$1.98 per share, with stronger second-half results expected following Pennsylvania and Rhode Island rate increases.
• Positive Sentiment: The company plans approximately $5 billion of 2026 capital investment and continues to target more than 10% average annual rate-base growth through 2029, alongside 6%–8% annual EPS growth.
• Positive Sentiment: Data-center demand continues to accelerate, with about 32 GW of signed agreements in Pennsylvania, including more than 11 GW under financially binding electric service agreements; PPL said two facilities began taking service during the quarter.
• Positive Sentiment: Invitium Energy, PPL’s joint venture with Blackstone, has more than 5 GW of combined-cycle gas generation accepted into the PJM queue and is targeting one or more commercial agreements by year-end, potentially adding significant investment and earnings upside beyond the current plan.
• Neutral Sentiment: Kentucky’s probability-weighted expected load growth increased to 3.7 GW by 2032, making an additional generation CPCN filing likely by year-end; potential resources could represent $3.5 billion–$4 billion of incremental investment, though the precise mix and regulatory outcome remain uncertain.

Presentation

[Operator]

Good day. Welcome to the PPL Corporation's conference call on second quarter 2026 financial results. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on a touch-tone phone. To withdraw your question, please press star then two. Please note that this event is being recorded. I would now like to turn the conference over to Andy Ludwig, Vice President of Investor Relations. Please go ahead.

[Andy Ludwig, VP of Investor Relations at PPL Corporation]

Good morning. Thank you for joining PPL Corporation's conference call on second quarter 2026 financial results. We provided presentation materials on the investor section of our website. This morning, you will hear from Vince Sorgi, PPL President and CEO, and Joe Bergstein, Chief Financial Officer. We will conclude with a Q&A session following our prepared remarks. Before we get started, please turn to Slide two for our cautionary statement. Today's presentation contains forward-looking statements subject to risks and uncertainties. Actual results may differ materially. Please refer to our SEC filings and the appendix for additional information. We will also refer to non-GAAP measures, including earnings from ongoing operations. Reconciliations to the corresponding GAAP measures are provided in the appendix. I will now turn the call over to Vince.

[Vince Sorgi, President and CEO at PPL Corporation]

Thank you, Andy. Good morning, everyone. Let us begin on Slide four with an overview of our second quarter performance. Q2 was another quarter of disciplined execution, supporting our 2026 commitments while strengthening confidence in our long-term outlook. Today, we reported ongoing earnings of $0.33 per share. Based on our results through the first half of the year and our expectations for the remainder of 2026, we are reaffirming our ongoing earnings forecast range of $1.90-$1.98 per share, with a midpoint of $1.94 per share. We expect stronger earnings growth in the second half of the year, supported by rate case outcomes in both Pennsylvania and Rhode Island, with Pennsylvania rates effective July 1st and Rhode Island rates expected to be effective September 1st.

[Vince Sorgi, President and CEO at PPL Corporation]

We are on pace to deploy approximately $5 billion of capital investments in 2026 to support the delivery of safe, reliable, and affordable energy service. As our investment plan has expanded, our teams have continued to demonstrate the ability to execute these programs safely, efficiently, and on schedule. Longer term, we continue to project $23 billion of capital investment needs through 2029, supporting average annual rate-based growth of over 10%. We also reaffirmed our long-term financial targets, including 6%-8% annual EPS growth through at least 2029, with compound annual growth expected to be near the top end of that range, 4%-6% annual dividend growth, and FFO to debt of 16%-18%. Importantly, these targets exclude any contribution from Invitium Energy, our joint venture with Blackstone, which represents meaningful long-term earnings and cash flow upside beyond the current plan.

[Vince Sorgi, President and CEO at PPL Corporation]

Turning to Slide five for a more comprehensive regulatory update. Coming into 2026, we had base rate case proceedings underway in all three of our primary jurisdictions. These rate case filings were after significant periods of stay out, ranging from five years in Kentucky, eight years in Rhode Island, and over 10 years in Pennsylvania. We made excellent progress in these proceedings during the second quarter, continuing to achieve constructive outcomes that de-risk our plan. In Pennsylvania, PPL Electric's rate case settlement became effective July 1st, with a positive outcome for both customers and share owners. The approved increase of $275 million supports critical investments we are making while reflecting less than a 4% increase across all of our rate classes. Importantly, even after our recent rate adjustment, PPL Electric's delivery rates remain nearly 20% below the latest published state average.

[Vince Sorgi, President and CEO at PPL Corporation]

This outcome reflects the benefits of our Utility of the Future strategy that prioritizes system hardening, disciplined cost management, strategic use of technology, constructive engagement with stakeholders, and a strong focus on affordability. The settlement also includes a two-year stay out provision. Through the continued use of the DIS mechanism and disciplined cost management, we will target remaining out of base rate cases beyond that period. In Kentucky, we're awaiting the commission's decision on our reconsideration request following another thorough and constructive regulatory process. While we believe the original KPSC decision allows us to deliver on our overall plan objectives, we believe there were some flaws in that decision that require reconsideration by the KPSC. We appreciate the commission's thoughtful review of our filing and continue to believe the investments and mechanisms supporting this filing are important to maintaining safe, reliable, and increasingly resilient service to our customers.

[Vince Sorgi, President and CEO at PPL Corporation]

We've requested a decision from the KPSC by August 14th. Turning to Rhode Island, our base rate case proceeding remains on track. Hearings were completed in mid-July. Briefs have been filed, and public meetings are scheduled for August 12th to the 20th. New rates are expected to become effective September 1st. As mentioned earlier, this is the first base rate increase Rhode Island Energy has requested in eight years and builds on the significant reliability improvements we've achieved since our acquisition of the utility back in 2022. The filing supports the continued investment needed to strengthen the system and prepare for frequent and severe weather events and continue distributed renewable deployment in the state. We also continue to make progress with our hold harmless bill credit proposal, which is being considered in parallel with the broader rate case proceeding.

[Vince Sorgi, President and CEO at PPL Corporation]

As a reminder, we've proposed accelerating customer bill credits associated with the deferred tax hold harmless commitment that we made when we acquired Rhode Island Energy. If approved, the credits would significantly offset the impact of the requested base rate increase for customers. This is another example of our balanced approach to affordability and investment, proposing creative solutions to help moderate customer bill impacts while continuing to invest in system reliability and resilience. Overall, these proceedings highlight the effectiveness of our regulatory strategy and provide a stronger foundation for continued investment. Moving to slide six. Against the backdrop of increasing national scrutiny around data center development, our Pennsylvania service territory continues to stand out because of its strong transmission reliability and access, proximity to major demand centers, and disciplined customer protections.

[Vince Sorgi, President and CEO at PPL Corporation]

Signed data center agreements with PPL Electric Utilities increased for the 10th consecutive quarter to about 32 GW, an increase of 3.5 GW from last quarter, with over a gigawatt coming from signed electric services agreements or ESAs. We now have more than 11 GW under ESAs, which carry meaningful financial commitments from the customer, which I'll cover in more detail in a few slides. We also continue to see these projects enter the construction phase, with more than 6.5 GW now under construction. During the quarter, two of these data centers began taking utility service, which are expected to ramp to about 2 GW of load by 2031. This continued progression from agreement to construction to taking service is improving our line of sight into future infrastructure and generation needs, including from our Invitium Energy joint venture with Blackstone.

[Vince Sorgi, President and CEO at PPL Corporation]

Turning to slide seven. Our Invitium joint venture continues to make progress across a number of critical paths. Ratepayer Protection Pledges and PJM's recent FERC proposal reinforce the need for new generation to serve large load customers. While strong data center activity in PPL Electric Utilities service territory is expanding the opportunity for long-term energy supply services agreements or ESSAs. During the quarter, we continued to move the joint venture from concept to execution. We now have strategic land sites capable of supporting between 8 GW and 14 GW of new generation, depending on the technology selected, and we are continuing to build our inventory of viable sites. We have over 5 GW of new CCGT generation that has been accepted in the PJM Interconnection queue. We also have over 5 GW of reservation agreements for combined cycle gas turbines.

[Vince Sorgi, President and CEO at PPL Corporation]

Using the market consensus project cost of approximately $2,500-$3,000 /kW, that 5 GW represents between $12.5 billion-$15 billion of potential future investment through 2032, of which PPL's share would be 51%. Collectively, these milestones give us increasing confidence that Invitium can support contracted growth and create incremental value for shareowners. While we do not expect the earnings contributions from the JV to be material through 2030, batteries or other shorter lead time technologies could begin contributing earnings in 2029 or 2030, which could enhance our projected EPS growth rate above the top end of our 6%-8% range. We would expect more meaningful earnings and cash flows when the CCGTs come online, which could be as early as the 2031, 2032 timeframe.

[Vince Sorgi, President and CEO at PPL Corporation]

As we've said, we will not move forward with construction or make material financial commitments until we have executed ESSAs with appropriate risk profiles in those contracts or have cost reimbursement agreements in place. Based on progress to date, we expect to have one or more commercial agreements by year-end. Turning to slide eight. Kentucky also continues to see strong economic development activity. The current development pipeline has expanded to 13.7 GW of potential load growth, with data center demand representing 11.6 GW and manufacturing and other non-data center projects totaling 2.1 GW. This is an increase of roughly 800 MW from last quarter. Of that pipeline, approximately 1.3 GW is now supported by signed reimbursement agreements, up from approximately 900 MW in the first quarter.

[Vince Sorgi, President and CEO at PPL Corporation]

Our updated probability weighted projections now indicate 3.7 GW of expected new load by 2032, more than double the amount reflected in our 2025 CPCN filing. That demand is making it even more likely that we will need to file a CPCN for additional generation resources by year-end. Potential resources for the CPCN include the 266 MW Lewis Ridge Pumped Storage Project, the 400 MW of batteries that were deferred in the 2025 CPCN, and additional natural gas combined cycle generation. While we won't know the exact resource mix until we file the next CPCN, those projects represent an incremental $3.5 billion-$4 billion of potential investment to be incurred between 2027 and 2032.

[Vince Sorgi, President and CEO at PPL Corporation]

As you can see, Kentucky is emerging as a significant platform for incremental growth, which is why we've been so focused on large load tariff protections designed to preserve affordability for our existing customers. Let's turn to slide nine for a discussion on how those large load tariffs are protecting our customers. The tariffs approved in Pennsylvania and Kentucky are grounded in a simple principle. Large load customers pay their own way with enforceable provisions that protect existing customers from cost shifts. First, these tariffs require long contracts with a minimum term of 10 years in Pennsylvania and 15 years in Kentucky. Kentucky's term is longer because of the fully integrated business model with generation resources as well. Second, customers commit to guaranteed payments of at least 80% of the capacity they reserve, whether they use it or not. Third, we require collateral upfront.

[Vince Sorgi, President and CEO at PPL Corporation]

Finally, although no projects with signed ESAs have been canceled to date, there are material termination fees in the event the developer walks away, even if they walk away pre-COD. With all of these elements in mind, our existing customers are protected from bearing costs for projects that do not move forward. These financial commitments materially improve project quality and increase our confidence that signed ESAs represent serious executable demand. These tariffs also provide tangible customer benefits. Starting in 2027, Pennsylvania's large load customer class will contribute $11 million annually to low-income assistance, which was previously funded by our existing customers. Our existing Pennsylvania customers could also see about $25 a month come off the transmission component of their bills over time if the 31.8 GW in advanced stages is realized.

[Vince Sorgi, President and CEO at PPL Corporation]

That would help offset the more than $20 per month our Pennsylvania customers are currently paying as a result of higher PJM capacity prices. Bottom line, these tariffs provide a disciplined framework to capture growth responsibly while ensuring that growth pays for growth. With that, I'll turn the call over to Joe for the financial update.

[Joe Bergstein, CFO at PPL Corporation]

Thank you, Vince, and good morning, everyone. Let's turn to slide 11. PPL's second quarter GAAP earnings were $0.30 per share compared to $0.25 per share in Q2 2025. We recorded special items of $0.03 per share during the second quarter, primarily due to IT transformation costs and system integration impacts. Adjusting for these special items, second quarter earnings from ongoing operations were $0.33 per share, an improvement of $0.01 per share compared to Q2 2025, which was in line with our expectations. With the first half of 2026 now complete, we remain firmly on track to achieve at least the midpoint of our 2026 ongoing earnings forecast of $1.94 per share. Base rate case outcomes in both Pennsylvania and Rhode Island support the stronger second-half earnings profile embedded in our plan.

[Joe Bergstein, CFO at PPL Corporation]

We've also made great progress on our CapEx program and have deployed approximately $2.3 billion through the end of the second quarter. This is roughly 30% more than what we deployed last year through the first six months as we continue to strengthen the safety and reliability of our networks. This also includes the great progress on our generation projects in Kentucky, which continue to be on budget and on schedule. Lastly, we continue to maintain a strong balance sheet supported by an improving credit profile with enhanced cash flows following our base rate cases and the settlement of previously priced equity, improving our credit metrics over time. That financial strength positions us to deliver our existing capital plan while maintaining flexibility as the additional investment opportunities, including those that Vince discussed, emerge across our service territories.

[Joe Bergstein, CFO at PPL Corporation]

We completed our financing needs for 2026 earlier in the second quarter with successful debt offerings at PPL Electric and Rhode Island Energy. Both transactions were very well subscribed and secured long-dated capital at attractive terms. Turning to the ongoing segment drivers for the second quarter on slide 12. Our Kentucky segment results were flat compared to the second quarter of 2025. These results were driven by higher base rate recovery due to higher retail rates that were effective on January 1st. This was offset by lower sales volumes due to less favorable weather than experienced in Q2 2025, higher operating costs, higher depreciation expense, and higher interest expense. Our Pennsylvania regulated segment results were $0.01 lower compared to the same period a year ago. These results were driven by higher depreciation expense and higher interest expense, partially offset by higher transmission revenue from additional capital investments.

[Joe Bergstein, CFO at PPL Corporation]

Our Rhode Island segment results increased by $0.02 compared to Q2 2025, driven by higher rider revenue and lower operating costs, partially offset by higher depreciation expense. Lastly, results at Corporate and Other remained flat compared to Q2 of 2025, mainly driven by higher interest expense, offset by other factors that were not individually significant. Overall, our growth drivers are in motion to deliver on our commitments for the year. Our financing plan continues to advance, and we see ongoing opportunities to build on the plan that we've outlined for both our customers and shareowners. This concludes my financial update. I'll now turn the call back over to Vince.

[Vince Sorgi, President and CEO at PPL Corporation]

Thanks, Joe. Before we open it up for questions, I'll leave you with a few closing thoughts. The headline for this quarter is straightforward. We are executing on our current plan while creating more visible upside beyond it. We delivered solid second quarter results, reaffirmed our 2026 earnings forecast, and long-term financial outlook. We've made great progress in achieving constructive outcomes in our base rate cases, supporting timely recovery of critical investments while maintaining customer affordability. At the same time, accelerating customer demand across our Pennsylvania and Kentucky service territories is giving us a clearer line of sight into the infrastructure and generation investments required to support meaningful future growth. We've also advanced tariffs that protect our existing customers as that large load demand becomes more visible.

[Vince Sorgi, President and CEO at PPL Corporation]

We continue to make considerable progress on the Invitium Energy joint venture with Blackstone and expect one or more commercial agreements to be announced by year-end. Finally, the Kentucky generation and Invitium Energy potential upsides could drive between $10 billion and $12 billion of incremental capital investment through 2032, which strengthens our growth outlook beyond the current plan period. With that, operator, let's open it up for questions.

[Operator]

Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your touch tone phone. If you're using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question today comes from Michael Lonegan with Barclays. Please go ahead.

[Michael Lonegan, Analyst at Barclays]

Hi. Good morning. Thanks for taking my question.

[Vince Sorgi, President and CEO at PPL Corporation]

Morning, Michael.

[Michael Lonegan, Analyst at Barclays]

Morning. Just wondering if you could talk about the interaction of the Invitium Energy JV with the bilateral process and RBP procurement. Would you have to wait for procurement to happen, or could you announce at any time? If you announce a deal, would it be included in the procurement?

[Vince Sorgi, President and CEO at PPL Corporation]

We are actively negotiating bilaterally, we've been doing that way before the PJM RBP process, Michael. Our ability to get to closure on bilateral contracts is irrespective of the PJM process. We did submit proposals into that process just to maximize our customer contacts, the two are not necessarily related given the activity we've been doing before the PJM process.

[Michael Lonegan, Analyst at Barclays]

Great. Thanks. Sticking with the JV, you said you could reach one or more agreements by year-end. Anything you could say about the size of the near term ones in terms of gigawatts and investment opportunity, could the announcement come when the agreements are reached, or would that be essentially a Q4 update?

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah. Sure. Not able to give a size at this point, depending on which ones happen first. We'll defer that until we actually make the announcements. I would say, timing of the announcements, again, materiality will really dictate that, Michael. Anything material, we would certainly not wait for an earnings call to announce. We would do that, I would say, in concert with signing of those agreements. Maybe just broadly on timing, I'll make a few comments where in terms of announcement timing. I would say the PJM RBP process is likely affecting the timing for some of our counterparties, but our customer engagement really, I would say, remains very strong, and we're continuing to see a clear path to the bilateral commercial agreements that support all this new generation.

[Vince Sorgi, President and CEO at PPL Corporation]

Even with the PJM proposal and the rules in their FERC filing, right, they are really pushing towards bilateral contracting, and we continue to believe that bilateral contracting will likely be the predominant path for getting new generation development in PJM at least. Given the progress that we've made to date and what I've said on the call, again, with the discussions we're having with our customers, but all of the other development work around site readiness, the turbine access, the interconnection activity that we've done with PJM, and I'd even add fuel supply to that.

[Vince Sorgi, President and CEO at PPL Corporation]

We're expecting that we would have one or more announcements by year-end. It could happen sooner, but I wouldn't want to speculate on exact timing just because these are complex. They're long-term agreements, and of course it takes two parties to finalize them. I think the key for us is we're not waiting for those ESSAs to begin that development work that we've talked about on the call today. We're running those in parallel. We're ready to respond very quickly in concert with the customer negotiations.

[Michael Lonegan, Analyst at Barclays]

Great. Thank you very much.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure.

[Operator]

The next question comes from Jeremy Tonet with JPMorgan. Please go ahead.

[Vince Sorgi, President and CEO at PPL Corporation]

Hey, Jeremy.

[Jeremy Tonet, Analyst at JPMorgan]

Hi. Good morning.

[Vince Sorgi, President and CEO at PPL Corporation]

Hi. Good morning.

[Jeremy Tonet, Analyst at JPMorgan]

Wanted to maybe follow up a little bit on the last points there. When do you expect to see the first results from the PJM capacity matching process? How do you view this process versus bidding into the actual RBP auction?

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah. We have not committed yet into bidding into the RBP auction. We did provide a proposal for the matchmaking part of the process. Right. Ultimately, PJM is looking to come out at the end of September with all of that. We'll ultimately see how that plays out. The casts that we're seeing in the PJM auction part of it, those are well below CONE on certainly some of the assets that we're talking about, Jeremy. More to come on how aggressively we're participating in that process. I will say, just like last quarter, our focus continues to be on the bilateral contracting process directly with our customer base.

[Jeremy Tonet, Analyst at JPMorgan]

Got it. That makes sense. Wondering maybe a little bit on timing. If the assets you bid into the matching process were selected, will we know by the end of September, or how should we think about next steps?

[Vince Sorgi, President and CEO at PPL Corporation]

I'm not exactly sure of the timing on when we would know that, Jeremy. Certainly something we'll continue to think through as we progress through that process. I'm not exactly sure of the timing, though, on what you'll hear back from them.

[Jeremy Tonet, Analyst at JPMorgan]

Got it. Fair enough. Maybe going over to Kentucky, everything you talked about there, a lot of upsizing opportunity. Just wondering, I guess, is there a milestone that you need to hit before you could do the additional CPCN filing that could be filed by year-end?

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah, you cut out on us there. I think you were asking about what are maybe some triggers for the CPCN filing.

[Jeremy Tonet, Analyst at JPMorgan]

Yes.

[Vince Sorgi, President and CEO at PPL Corporation]

Do I have that right? Okay. Yeah. Look, I think we are seeing some of those triggers already as we're seeing the continued increase in the pipeline. We are signing various agreements for new load with data center developers and also with non-data center customers. All of that continues to move in the right direction, and that's really what's driving our new probability weighted load of 3.7 GW. That's twice what we had in the last CPCN. I would say the one area that we would want to see in addition to the commission is the conversion from the data center developer to an actual hyperscaler contract. I will say those activities are happening as we speak. I would say once we have one of those, that would be a pretty big trigger to prompt us to make that filing before year-end.

[Jeremy Tonet, Analyst at JPMorgan]

Got it. Understood. Thank you.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure.

[Operator]

The next question comes from Paul Zimbardo with Jefferies. Please go ahead.

[Vince Sorgi, President and CEO at PPL Corporation]

Hey, Paul.

[Paul Zimbardo, Analyst at Jefferies]

Hi. Good morning, team.

[Vince Sorgi, President and CEO at PPL Corporation]

Morning.

[Paul Zimbardo, Analyst at Jefferies]

Thank you for taking the time. I just wanted to dive a little bit more, of course, into the joint venture. I know you've been consistent that we shouldn't expect to see material earnings before 2030. Just how would you envision articulating what the earnings contribution is? Would you do a separate joint venture earnings separate from kind of the base business, more long duration CAGR beyond 2030? Just if you could help on what kind of disclosures we should expect.

[Joe Bergstein, CFO at PPL Corporation]

Paul, it's Joe. We would give something separate from the base utility business, so you could see the earnings and the growth and the trajectory of earnings coming out of the JV. Obviously we'd provide an update on its impact on the CAGR that we have currently. Yes, I think you're right. You're thinking about it correctly on both of those.

[Vince Sorgi, President and CEO at PPL Corporation]

Paul, this is equity method for accounting purposes. Single line items on the financials. We'll clearly break all that out in additional disclosure for this part of the business once it starts to materialize.

[Paul Zimbardo, Analyst at Jefferies]

Okay. Great. Understand there. Shifting to Kentucky for a second. I saw the governor's executive order around data centers and kind of focus on emissions, water, and some of those things. Does that shift what you could procure to support the data centers? Like I know you mentioned the pumped storage, but just any thoughts on the executive order would be helpful.

[Vince Sorgi, President and CEO at PPL Corporation]

No. It was good to see the order come out. We view it as fully consistent with the ratepayer protection principles that we've been championing and even the ratepayer protection pledge that we signed recently, where new large load customers should be supporting and paying for the infrastructure and the resources that are needed to serve them. Importantly, the order did not prohibit or put a moratorium on data center development. It simply is reinforcing that we need to have customer protections built into the process, which of course, we have built into our approach.

[Vince Sorgi, President and CEO at PPL Corporation]

I would say that LG&E and KU with our tariff structure that we've gotten approved in the state. We're well-positioned within that tariff structure to align very nicely with our governor's executive order. Not concerned at all. We don't think it will slow down the development that we're seeing in Kentucky or our ability to serve it.

[Paul Zimbardo, Analyst at Jefferies]

Okay, great. No, thank you very much, team.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure.

[Operator]

The next question comes from Shar Pourreza with Wells Fargo. Please go ahead.

[Andrew Kadavy, Analyst at Wells Fargo]

Hi. Actually, it's Andrew Kadavy on for Shar. Thanks for taking my question.

[Vince Sorgi, President and CEO at PPL Corporation]

Hey, Andrew.

[Andrew Kadavy, Analyst at Wells Fargo]

With the longer-dated opportunities on your plate, could we see maybe a longer planning window next time you guys update guidance? What are some of the considerations that go into that decision?

[Joe Bergstein, CFO at PPL Corporation]

Yeah. I think that's certainly possible, right? Given the timing that we're talking about as to when we see earnings contributions from these agreements and given the logistics and timing around getting CCGTs into service. That's certainly a consideration.

[Andrew Kadavy, Analyst at Wells Fargo]

Just circling back to PJM. Can you share how potential Invitium Energy customers are viewing the Connect and Manage and IRF rulings in PJM? Has the clarity around that helped progress some of your commercial decisions?

[Vince Sorgi, President and CEO at PPL Corporation]

Right, what was in the letter at least was not included in the filing last week. We are expecting that imminently, perhaps even today. I'll reserve judgment on that until I see the actual filing. I would say coming from the letter that PJM put out, with their guiding principles, I think what you're starting to see is some clarity on what large loads we'll need to procure during the ramp phases, right? There was a lot of early questions on, do you need to just have BYOG online when you hit your max load, or do you need to follow your ramp, or can you do it in chunks? Obviously, the load comes on in different megawatt chunks, then you're able to bring generation on if you're using certain types of generation.

[Vince Sorgi, President and CEO at PPL Corporation]

I think you'll see, certainly as we think about following ramps so that the hyperscalers are not in that Connect and Manage or interruptible phase. They'll want to try to match that ramp the best they can. That I think will prompt batteries and other types of smaller generation that can come online quickly and at smaller amounts. Then you're kind of anchored with some of the larger asset types that we're talking about. All of those are part of our discussions with the hyperscalers. It's all of those types of technologies and following ramp curves, for sure.

[Andrew Kadavy, Analyst at Wells Fargo]

Thank you for that. I'll leave it there.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure.

[Operator]

The next question comes from Steve Fleishman with Wolfe Research. Please go ahead.

[Steve Fleishman, Analyst at Wolfe Research]

Hey, good morning, everybody.

[Joe Bergstein, CFO at PPL Corporation]

Morning.

[Steve Fleishman, Analyst at Wolfe Research]

Morning. Couple questions on the joint venture. Just going back to the shorter-term potential projects. You mentioned batteries. What other technologies are you likely to be using for shorter term? Is it mainly just like [RECEPs] or AROs or anything else? CTs.

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah, I would say those are the main, right? The CTs are still I would say the CTs are quicker than the CCGTs, but probably outside of our 2029, right? Which is our current plan period, Steve. CTs could be probably in the 2030, 2031 range, with the CCGTs in the 2031, 2032 range. Then, yeah, you mentioned the types of technologies that could get in more in that 2029, 2030 timeframe.

[Steve Fleishman, Analyst at Wolfe Research]

Fuel cells?

[Vince Sorgi, President and CEO at PPL Corporation]

We are engaged with the fuel cell manufacturers, so it is on the list of technologies. Ultimately will depend on what the hyperscalers would like us to procure and operate, but we are open to those as well, yes.

[Steve Fleishman, Analyst at Wolfe Research]

Yeah. How should we think about funding the joint venture and the projects and just how much is likely to be equity from PPL and are you looking at kind of alternative financing structures? Even just the economics, are you just going to do a straight 50/50? Sometimes when you have a financial partner, you can kind of manage the path of cash flow and earnings. Just any thoughts on all that.

[Joe Bergstein, CFO at PPL Corporation]

Yeah, sure. First on the financing question. During the construction period, we'll use construction period-type financing structures that will keep the off-balance sheet to limit any near-term dilution, and then once those projects go COD, we'll put in place a permanent financing structure. As far as the cap structure, we've talked about utility-like risk profile and returns, but we obviously have some flexibility in and around where that cap structure could be. We'll keep that in mind as we think about longer-term credit implications. We obviously want to maintain our strong credit position, so we'll have to take that into consideration with discussions with the rating agencies as they think about it as well.

[Steve Fleishman, Analyst at Wolfe Research]

Okay. Great. Thank you.

[Vince Sorgi, President and CEO at PPL Corporation]

Thanks, Steve.

[Operator]

The next question comes from Angie Storozynski with Seaport. Please go ahead.

[Angie Storozynski, Analyst at Seaport]

Thank you. I want to talk about Pennsylvania, how you, on the regulatory side. You have concluded your rate case. You are not allowed to have another one until what? Middle of 2028, at least. Yeah. Just wondering, are you hoping to maybe rely more on the DISC mechanism, any ways to maybe reduce costs so that you don't have to file that rate case anywhere near the 2028, 2029 timeframe?

[Joe Bergstein, CFO at PPL Corporation]

Yeah, Angie, you're exactly right on the settlement provisions. There's a two-year stay out agreement that we will not increase base rates during that period, which extends through July 1, 2028. We always look to maximize the time between rate cases, and we've done that very effectively across all jurisdictions. As you know, in Pennsylvania, it was 10 years since our last rate case prior to this one. I don't know that we can go another 10 years, but we'll certainly use that same discipline that we have. We've utilized the DISC extremely effectively over that time period. I will look to continue to do so. We've also managed our costs very well, and we continue to focus on that in that area as we've been and will continue to be focused on affordability for customers.

[Joe Bergstein, CFO at PPL Corporation]

Our current LTIP plan, which is the capital that is eligible for the DISC, runs through 2027. We'll be looking to file an updated five-year LTIP plan next year. Again, looking to maximize that and maximizing the use of the DISC mechanism. I think too early to tell as to when our next rate case would be, but we are always looking to, as I said, maximize the time between cases.

[Vince Sorgi, President and CEO at PPL Corporation]

I would just add to that, Angie. You've heard from our chair and our commission that they want to take a look at the DISC mechanism, where maybe have more formula-based ROE setting in the mechanism, maybe provide some performance band around that base ROE. The goal is really to provide a mechanism for the utilities to be able to stay out of base rate cases longer. We will certainly be engaging with our commission, obviously the other EDCs in the state and other stakeholders as we go through that process with the PUC. I think that could be encouraging as well. Depending on how that plays out, we'll have to factor that into our rate case timing. I think all of that is boding well for our likely being able to stay out beyond just the two years that are in the settlement.

[Angie Storozynski, Analyst at Seaport]

Great. Changing topics to the data centers in the PPL zone. The projects that you have already supported by ESAs are well above the current excess generation in the PPL zone. I know that we're still waiting for the connect and manage filing, I'm just wondering if there were to be forced curtailment in the future, supposedly in your zone, that would be pretty much least likely, again, given excess generation capacity. Again, it will be depleted. How do you see it? Do you think that this connect and manage could potentially actually give you a competitive advantage versus other zones in PJM simply because, again, the forced curtailment would be probably least likely in your zone?

[Vince Sorgi, President and CEO at PPL Corporation]

You cut out on us a little bit there, I think what you were saying was just with the generation length that we currently have and then that being depleted by the ESAs, the 11 GW of ESAs, and of course, that continues to grow. Yeah. I think it's one of the reasons why we have so much interest in the sites that we have in our joint venture, and we've been very strategic in accumulating the sites that we have. In order to qualify for BYONG now with the N, even under the new proposed rules, you don't have to be co-located to the load. The fact that we are very near the load creates a very competitive position for us as you think about PJM planning, interconnection studies, all of that, where the generation and the load are very tightly situated.

[Vince Sorgi, President and CEO at PPL Corporation]

That all bodes well, I would say, for our territory and where we're siting or proposing to site all of this new generation. It really helps to strengthen the reliability of the grid overall, and then get back to that long position for generation coming from Pennsylvania, which, as you know, us and West Virginia are the two power generation sources for PJM. I think that, again, you cut out on me, but I think that's what you were asking, and I agree that our position within the state provides that advantage, a competitive advantage.

[Angie Storozynski, Analyst at Seaport]

Great. Thank you.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure. Thanks, Angie.

[Operator]

The next question comes from Nick Amicucci with Evercore ISI. Please go ahead.

[Vince Sorgi, President and CEO at PPL Corporation]

Morning, Nick.

[Nick Amicucci, Analyst at Evercore ISI]

Hey. It's Amicucci, but you know, vowels. We know how it goes. I wanted to ask quickly, just kind of piggybacking on Steve's question before, just when we think about those shorter lead time technologies as early as 2029 or 2030, are those going to require a separate ESSA or are they going to be typically riding on the CCGT contracts?

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah, no, the ESSA contract is for generation to supply a data center. It does not need to be limited to the CCGT. It will be whatever suite of assets that we ultimately agree with the hyperscaler for. The third-party data center developers, which are also now getting involved in the BYOG and then providing that full RAT service to hyperscalers as one package. We're now seeing other entrants into the interest into the product offering.

[Vince Sorgi, President and CEO at PPL Corporation]

I will say, though, while the batteries are certainly the fastest to market, they're also the easiest for the hyperscalers to embed in their designs and may just make it part of the data center construction project. Part of the issue that we have with predicting how much will show up through 2029 is I'm convinced there'll be batteries that are coming on system by 2029, but some of that could be owned directly by the hyperscalers as opposed to third-party generators like Invitium. If that makes sense.

[Nick Amicucci, Analyst at Evercore ISI]

Got it. Yeah, no, that makes perfect sense. Thanks.

[Vince Sorgi, President and CEO at PPL Corporation]

Great.

[Nick Amicucci, Analyst at Evercore ISI]

Just really quickly, too, on the two data centers that began taking service within Pennsylvania in Q2. Has the LP-6 minimum demand billing started or is there a ramp schedule associated with that, too, as those continue to come online?

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah. That 2 GW is not until that's the ramp through 2031.

[Nick Amicucci, Analyst at Evercore ISI]

Right.

[Vince Sorgi, President and CEO at PPL Corporation]

Yeah, it's the smaller ramp that's kicking in now under the tariff. Yeah.

[Nick Amicucci, Analyst at Evercore ISI]

Got it. Thanks, guys.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure.

[Operator]

Again, if you have a question, please press star then one. The next question comes from Paul Patterson with Glenrock Associates. Please go ahead.

[Paul Patterson, Analyst at Glenrock Associates]

Hey, good morning.Good morning.Just one question left here. With Pennsylvania, I know we're on recess and stuff, but any thoughts or outlook about what we might see legislatively with respect to some of the legislation that's passed or anything perhaps on the I'm just wondering, have you heard anything over the summer here about what might happen in the next few months in Harrisburg?

[Vince Sorgi, President and CEO at PPL Corporation]

There was quite a bit of activity prior to the budget being approved, as you're alluding to. Look, I would just say overall, as you can see from our pipeline alone, right, there's tremendous data center interest in Pennsylvania, and in particular our zone. Look, for some of our local communities, right, these projects represent very material investments, right? Which is good, but it also can overwhelm these local communities. I think what we're seeing, Paul, is just at the local level with the support of their elected officials, right, just this move to slow down a little bit so that they can effectively review the projects, update their zoning requirements as needed. But really just take some time to make sure that they're doing this the right way. That seems very reasonable to us.

[Vince Sorgi, President and CEO at PPL Corporation]

I think that's what you're seeing with some of the proposed legislation coming from some of our elected officials. While there was some legislation advanced in the House, I would say that the state continues to remain supportive of this type of development in the sector as long as our customers and our communities are protected. You're starting to see some of that legislation designed to ensure that those protections happen. I will say, I'm seeing a shift in the developers and how they're engaging with the local communities and putting together differentiated community benefit packages. Right? What one community might think is a benefit, another may not. So doing that kind of community by community engaging earlier, more transparently.

[Vince Sorgi, President and CEO at PPL Corporation]

I think all of that, while we wish it had happened from day one, we're starting to see the shifts in that, and I know the folks are appreciating that level of transparency and really willingness to work and come up with a win-win for both the data center and for the community. It's the same areas that you're hearing, right? It's the water, it's the land, it's the noise, it's power prices and power reliability. Both of which we have well at hand. And we will be, I would say, pushing that even further as we can build new generation under Invitium Energy and just take some pressure off the supply demand curve at the wholesale level.

[Vince Sorgi, President and CEO at PPL Corporation]

All of these things, I think, are moving us in a consistent direction with where some of this legislation, or at least the ideas behind some of this legislation, were coming from. Again, I don't think it's misplaced. I don't think that you're going to see moratoriums or we just can't add data centers in Pennsylvania. We just need to make sure that our customers and our communities are protected as we do it. Again, I think all that's reasonable.

[Paul Patterson, Analyst at Glenrock Associates]

When you look at that on the wholesale side, do you think that transfers this constructive way of putting some relief on the wholesale prices, that sort of translates to some of this regulated generation legislation, regulated utility legislation? How do you see that impacting that? Do you think that's pretty much on ice as a result of what you're doing on the wholesale side, if you follow what I'm saying? Do I make sense?

[Vince Sorgi, President and CEO at PPL Corporation]

I don't know if it's totally on ice. It is still part of the discussion, but I would say with all of the moving parts that we've been seeing at PJM and at FERC, the legislature is certainly, I would say, keyed into all of those moving parts and seeing if, in fact, that they will help address the resource adequacy concerns that we've been talking about. Again, we're a bit skeptical that the PJM FERC filing will in fact resolve that long term. We think the bilateral process is probably going to be the predominant way to get things built in PJM. I think the legislature needs to see that play out. Our governor needs to see that play out a little bit. While regulated generation, I wouldn't say that it's totally off the table.

[Vince Sorgi, President and CEO at PPL Corporation]

I think they want to see how some of these other things progress to see if they need to pull that lever or not. Of course, we continue to have regular discussions with them. This will play out as those bills are debated in their respective committees, and we'll see whether they come out of committee or not. There's been so much activity, as you know, at both FERC and PJM that legislation, I don't think has been the highest priority for obvious reasons.

[Paul Patterson, Analyst at Glenrock Associates]

Okay, great. I really appreciate it. Have a good weekend.

[Vince Sorgi, President and CEO at PPL Corporation]

Sure. You too.

[Operator]

This concludes our question and answer session. I would like to turn the conference back over to Vince Sorgi for any closing remarks.

[Vince Sorgi, President and CEO at PPL Corporation]

Great. Thank you, operator. Look, as we wrap up, the key takeaway from today is our investment case continues to get stronger. We're executing a strong base plan today while building additional strong growth opportunities for tomorrow. With continued regulatory execution and accelerating demand growth and the progress that we're making at Invitium Energy, we believe the upside is increasingly visible and remains incremental to the outlook that we've reaffirmed today. Thanks for joining us, and we look forward to seeing you soon.

[Operator]

The conference has concluded. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Andy Ludwig, VP of Investor Relations
• Vince Sorgi, President and CEO
• Joe Bergstein, CFO

Analysts

• Michael Lonegan, Analyst at Barclays
• Jeremy Tonet, Analyst at JPMorgan
• Paul Zimbardo, Analyst at Jefferies
• Andrew Kadavy, Analyst at Wells Fargo
• Steve Fleishman, Analyst at Wolfe Research
• Angie Storozynski, Analyst at Seaport
• Nick Amicucci, Analyst at Evercore ISI
• Paul Patterson, Analyst at Glenrock Associates