01—Abstract
Summary
Summary of the 8-K filed March 31, 2026. Cited figures are marked; the original filing is the authoritative source.
Eversource Energy (ES) has filed an 8-K detailing its response to a recent Federal Energy Regulatory Commission (FERC) order reducing the authorized return on equity (ROE) for New England transmission owners.
The company views this decision, which sets a base ROE of 9.57%a and a maximum incentive ROE of 12.09%, as arbitrary and inconsistent with federal law, arguing it uses outdated data and fails to reflect current economic conditions. This reduction is expected to have significant negative impacts on transmission owners and customers by increasing the cost of capital for essential infrastructure upgrades and potentially eroding investor confidence. In response, Eversource is pursuing legal action, including a motion for a stay of the order, and is considering a Section 205 filing to propose updated rates.
The company also highlights concerns about potential retroactive refunds, which could be implemented over 18-24 months if upheld. The negative impact on Eversource's 2026 earnings is estimated at approximately $70 millionb due to the ROE change, leading to a revised non-GAAP earnings guidance range of $4.57 to $4.72 per share. The company reiterates its long-term earnings per share growth target of 5-7% through 2030.
02—Key points
Key Highlights
- FERC has issued an order reducing the base Return on Equity (ROE) for New England transmission owners to 9.57%, with a maximum incentive ROE of 12.09%.
- Eversource Energy is taking legal action, including filing a motion for a stay, to contest the FERC order, deeming it arbitrary and based on outdated data.
- The company believes the FERC decision will negatively impact investor confidence and increase the cost of capital for vital transmission infrastructure investments.
- Eversource and other New England transmission owners are exploring a Section 205 filing to propose updated rates reflecting current economic conditions.
- The FERC order could lead to retroactive refunds to transmission customers, potentially spanning 18-24 months if upheld.
- Eversource anticipates a $70 million reduction in its 2026 after-tax earnings due to the new ROE.
- Revised 2026 non-GAAP earnings guidance is now projected to be between $4.57 and $4.72 per share, factoring in the ROE impact and the potential sale of Aquarion.
03—Questions
Frequently Asked Questions
What is the main reason for this 8-K filing?
This 8-K filing is to inform investors about Eversource Energy's response to a recent order from the Federal Energy Regulatory Commission (FERC) that significantly reduced the authorized Return on Equity (ROE) for New England transmission owners. Eversource disputes this decision and is taking legal and regulatory actions.
How will the FERC's decision impact Eversource's financial performance in 2026?
Eversource expects the FERC's decision to lower its 2026 after-tax earnings by approximately $70 million. Consequently, the company has revised its 2026 non-GAAP earnings per share guidance to a range of $4.57 to $4.72.
What actions is Eversource taking in response to the FERC order?
Eversource, along with other New England transmission owners, is pursuing legal action, including filing a motion for a stay of the order, and is considering a formal request (Section 205 filing) to FERC to establish updated rates based on current economic conditions. They are also evaluating the possibility of a rehearing.
Could Eversource be required to issue refunds to customers, and if so, when?
Yes, the FERC order addresses potential refunds for prior periods. If these refunds are upheld, Eversource and other transmission owners would issue them to transmission customers over an estimated 18 to 24-month period, subject to FERC approval.
04—Continue