Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported July 28, 2026 · Beat 2 of last 5 quarters
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CenterPoint's 14 GW of batch-zero-eligible load, representing a >65% increase in system peak, underscores the scale of AI-driven electricity demand in the Houston region. The company's ability to connect large loads at less than $60M per GW with modest incremental capital highlights the efficiency of existing grid infrastructure, but also signals the need for broader transmission investment to sustain growth. This reinforces the thesis that AI infrastructure buildout is driving significant utility capital expenditure and load growth, with implications for suppliers and grid planners.
CenterPoint reported Q2 2026 non-GAAP EPS of $0.40, beating consensus, driven by $0.10 of rate recovery growth and $0.02 favorable O&M, partially offset by weather and higher interest expense. The company submitted 17 GW of large load projects into ERCOT's batch zero process, with 14 GW expected eligible (10 GW baseload, 4 GW studied load). They increased the 10-year capital plan by $1.2 billion, including $800 million for system upgrades and $400 million for the Downtown Houston revitalization project. Management also highlighted progress on a transformational large load opportunity in Indiana and reiterated full-year guidance.
Management reiterated full-year 2026 non-GAAP EPS guidance of $1.89–$1.91, implying 8% growth at the midpoint, and reaffirmed long-term EPS growth of 7–9% through 2035. They raised the 10-year capital plan by $1.2 billion to $66.7 billion, funded without additional equity, and expect Houston Electric rate base CAGR of over 18% over the next three years. They anticipate energizing nearly all of the 14 GW of batch-zero-eligible load by end of 2030. Management also highlighted potential financing tailwinds from demand charges (~$6M/GW/month), remarketing temporary generation units, and a CAMT tax refund, while maintaining a disciplined approach to folding in incremental capital only as projects become more defined.
“We are confident the combined 14 gigawatts of baseload and study load are well positioned to move forward in the batch zero process given the level of customer commitments already secured.”
on ERCOT batch zero progress
“We expect to deploy this incremental capital over the next 5 years without the need for additional equity financing.”
on Capital plan increase
“We have not yet pulled in the benefit from the demand charges from these large customer loads.”
on Financing tailwinds
On the transmission study, are the $8M per mile CapEx and $6M per GW per month cash benefits still relevant?
Jason confirmed the $8M per mile assumption, with a better view on actual costs in Q1 next year, and reiterated the $6M per GW per month demand charge cash flow, which will accelerate significantly in 2027–2029.
How do you think about the timing of the transmission update against legislative scrutiny, and how much of the large load revenue is reflected in the plan?
Jason said the transmission study update will come in H2 2026, emphasizing that growth is not slowing and the state is aligned on enabling growth. Chris confirmed that demand charge benefits from large loads are not yet reflected in the plan, nor are temporary generation unit proceeds or the CAMT refund.
Can you expand on the $5 billion customer savings from the 14 GW batch zero, and how does that influence stakeholder conversations?
Chris explained that 14 GW translates to ~$800M in revenue requirement, with 65% absorbed by industrial/commercial customers, yielding ~$500M/year in savings for residential/small commercial, totaling $5B over 10 years. Jason added that both Texas and Indiana state leadership align on economic development as the path to affordability.