WEC
#Well, there were no refunds.
What we did, <UNK>, just to be clear, is we accrued under the sharing mechanism ---+ we accrued $18 million pretax in the third quarter.
And then based upon the fourth-quarter results we get to a final number, the $18 million could increase, it could decrease because the accounting period you look at for sharing is the calendar year.
Yes, and there is really not a refund, it is really just paying down a regulatory asset or reducing a future rate increase.
So it is not like we are going to give cash back to customers, we will be able to reduce or not increase rates in the future related to it.
No, and let me just sort of clarify it to make sure everybody understands.
So I expect next year, if you look at the system modernization program, so this would be basically the replacement of the cast-iron mains to new meters, whatnot.
But that will be nearly $300 million of spending in 2017.
And that will go ---+ going back to <UNK> <UNK>'s question, that $300 million will go through the QIP rider.
In addition to that, I expect that we are going to have to spend $50 million on the safety-related things at the Manlove storage field.
Now that $50 million, <UNK>, I think it is spread, <UNK>, over three or four years.
It is spread out a few years, but at this point I would not expect to put that $50 million through the QIP writer.
I hope that wasn't clear as mud.
(Multiple speakers).
The other part is a variety of different items.
And like <UNK> said, those items ---+ I mean it ranges from additional infrastructure work to some meters that are outside of the footprint, also some software in there.
So those there do not go through the rider.
However, we do have depreciation on an ongoing basis and that is really filling in some of that normal depreciation in the area.
Well, just to be clear, so this is related to methane leaks on a gas distribution system in Chicago.
And my understanding of the approach that the team uses there to prioritize projects, it already takes into account leak rates, methane leak rates.
So there is already the attempt to build into that process that variable, if you will, in trying to reduce methane leaks.
So I would view that we are already trying to address that in the way we do the prioritization.
Certainly if there is a better more precise way to factor that into the process, that certainly is something we can consider.
But it is already being considered in the current prioritization process.
Yes, not a lot of color that I could give you, <UNK>.
My understanding was that this would be a study that the state government there would kick off and look at the feasibility of that, what would it cost, etc.
But not any real color that I can give around that.
Well, I think as I look at the capital spending in response to one of the previous questions, we certainly view that what we put on the table for retail CapEx and the retail utilities, what ATC has put on the table for inside the footprint, we all view that as being supportive of the earnings per share guidance range.
The way I would answer your question, <UNK>, to actually kick ourselves up in that range we are going to need to be able to be successful with some of these transmission developments outside of the traditional footprint at ATC.
So I think if I certainly saw in a significant way some successes outside the footprint at ATC, that would certainly give me some comfort to push our forecast up but still within that 5% to 7% range.
Right.
Go-ahead, <UNK>, I am sorry.
Two things though that I think you should keep in mind, <UNK>, one is remember we had this additional bonus depreciation has kind of been in the middle here.
So that was a $1 billion cash tax impact.
The other thing that perhaps people don't talk about quite as much, since we talked about a 5% to 7% earnings per share growth range we have seen allowed rates of return, most notably the allowed rate of return in FERC go down.
So there have sort of been some put and takes.
Certainly there have been some increases in our projected level of capital spending, those are the puts.
The takes, we certainly had bonus [depreciation] and some reduction in allowed rate of return.
Yes, so they increase slightly in 2017 and 2018 about 1% and it's not until like 2019 or 2020 that we going up at a 6% rate.
Yes.
Well, as you got to 2019, so the figures that <UNK> talked about, if you do it in a total rate, if you look at it in total rates, my recollection is it's about a 1.25%, somewhere that range, a 1.25% uplift on total rates.
Correct.
So the bonus appreciation is through 2019 and the new additional CapEx would qualify for the bonus.
Yes.
So when you look at it the $1 billion was with the original plan.
I'm sure it is a couple hundred million dollars more.
We will probably be a cash taxpayer in like 2018.
Okay, well thank you very much for your questions.
That concludes our conference call for this afternoon.
Certainly if you have any more questions, please contact Beth Straka or <UNK> <UNK>, 414-221-2592.
Thank you.
