Hello, and welcome to the WEC Energy Group Annual Meeting of Stockholders. Please note that today's meeting is being recorded. During the meeting, we'll have a question and answer session. Stockholders who have entered the meeting using their control number can submit questions or comments at any time by selecting the Q&A icon. It is now my pleasure to turn today's meeting over to Gale Klappa. Mr. Klappa, the floor is yours.
Thank you very much, and good afternoon, ladies and gentlemen. It's just past 1:30 P.M. Central Daylight Time, the time set for convening WEC Energy Group's 2024 Annual Meeting of Stockholders. I'm Gale Klappa, Executive Chairman of WEC Energy Group, and I will serve as Chairman for today's meeting. Before we begin, I'd like to call your attention to the rules of conduct for our meeting. They're available on the right side of the meeting page on your screen in the Documents folder. We've also provided a link if you'd like to reference our proxy materials at any time today. Now it's time to call our 2024 annual meeting to order. I've been given the inspector's report, which indicates that more than 87% of the company's outstanding shares are represented.
This constitutes a quorum under the company's bylaws, and this meeting, therefore, is duly convened to conduct business. At the end of our formal program, we'll be happy to answer your questions. As always, some of the information you will receive at this meeting is forward-looking in nature and is based on our current expectations. Our projections, of course, involve risks and uncertainties. Factors discussed in the company's latest Form 10-K and in subsequent reports filed with the Securities and Exchange Commission could cause our actual results to differ materially from those discussed at our meeting today. Now we'll begin our business session. All members of the WEC Energy Group Board of Directors who are standing for election are joining us today. Also attending are Dennis Snyder from Computershare. Computershare is the company that serves as our transfer agent and registrar.
Dennis has been appointed as the Inspector of Election for our meeting. Also with us today are P.J. DiStefano and Andy Kurz from Deloitte & Touche. They're our independent auditors. And now I'll call on our Executive Vice President, General Counsel, and Corporate Secretary, Peggy Kelsey, to discuss the proposals that we have before us and to conduct the voting. Peggy?
Thank you, Gale. On March 28, 2024, a notice of this meeting was sent to all stockholders of record as of March 11, 2024. We will now proceed with the vote for the 2024 annual meeting. If you previously voted your proxy, your vote has already been recorded. If you entered the meeting using your control number and have not yet voted, or you wish to change your vote, you may do so now by clicking on the Vote link in the online meeting center. The link is labeled Vote and can be found on the top right of the screen. We will close the polls shortly. As set forth in your proxy statement, there are four management proposals on which stockholders have been asked to vote.
Number one, election of 12 directors to serve for terms expiring at the annual meeting of stockholders in 2025, including Ave Bie, Curt Culver, Danny Cunningham, William Farrow, III, Cristina Garcia-Thomas, Maria Green, Gale Klappa, Thomas Lane, Scott Lauber, Ulice Payne, Jr., Mary Ellen Stanek, and Glen Tellock. Number two, ratification of Deloitte & Touche LLP as independent auditors for 2024. Number three, an advisory vote to approve compensation of the named executive officers, otherwise known as Say-on-Pay. Number four, an amendment of our restated articles of incorporation to increase the number of authorized shares of common stock. In addition, there is one stockholder proposal regarding simple majority vote on which stockholders have been asked to vote. At this time, I invite Mr. John Chevedden to present his proposal. Mr. Chevedden, you will be allowed up to 3 minutes for this presentation.
After that time, we will proceed to the proxy vote. Mr. Chevedden, the floor is yours.
Hello, this is John Chevedden. Proposal 5, simple majority vote. Shareholders request that our board take each step necessary so that each voting requirement on our charter and bylaws that calls for a greater than simple majority vote be replaced by a requirement for a majority of the votes cast for and against proposals or a simple majority. This means the closest standard to a majority of the votes cast for and against such proposals. This includes making the necessary changes in plain English. Shareholders are willing to pay a premium for shares of companies that have excellent corporate governance. Supermajority voting requirements have been found to be one of six entrenching mechanisms that are negatively related to company performance, according to What Matters in Corporate Governance by Lucian Bebchuk of the Harvard Law School.
Supermajority requirements are used to block initiatives supported by most shareholders, but opposed by a status quo management. This proposal topic won 74%-88% support at Weyerhaeuser, Alcoa, Waste Management, Goldman Sachs, First Energy, McGraw Hill, and Macy's. These votes would have been higher than 74%-88% support if more shareholders had access to independent proxy voting advice. This proposal topic also received overwhelming 98% support at the 2023 annual meetings of American Airlines and the Carlyle Group. The WEC Board of Directors is neutral on this proposal.
... But this is such an important proposal that the board of directors could easily be in favor of it. This is a corporate governance improvement proposal that the WEC Energy Board of Directors should have put to a shareholder vote on its own initiative years ago. Please vote yes, simple majority vote, Proposal Five.
Thank you, Mr. Chevedden. As you pointed out, the board is not recommending a vote for or against this proposal, as outlined on page 77 of the proxy statement. I have been appointed to vote all of the shares represented by the proxy votes sent in by our stockholders. I have submitted the proxy ballot that reflects your instructions to the Inspector of Election. The polls are about to close, so if you have not finished voting, please do so now. Thank you. The online voting is now closed. The preliminary inspector's report has been completed. Based on a preliminary review of the votes cast, I declare that all nominees for the board of directors have been elected. The appointment of Deloitte & Touche as independent auditors for 2024 has been ratified. The advisory vote to approve the compensation of the named executive officers has passed.
The amendment of our restated articles of incorporation to increase the number of authorized shares of common stock has passed, and the stockholder proposal regarding the simple majority vote has passed. A final report will be filed with the Securities and Exchange Commission in the next few days. I will now turn the meeting back over to you, Gale.
Peggy, thank you very much. The formal business portion of our meeting is now adjourned. At this point, we'd like to provide you with a brief update on our company's progress. I'm pleased to report that on virtually every meaningful measure, from customer satisfaction to financial performance, to steady execution of our capital plan, we delivered another year of solid results. Then, as we turn the calendar to January of this year, the board of directors raised our dividend by 7%. This marks the 21st consecutive year that our company has rewarded shareholders with higher dividends. I'm pleased to share that because of our consistent track record of dividend growth, our company has been added to the Standard and Poor's High Yield Dividend Aristocrats Index. This index is made up exclusively of companies that have raised their dividends for at least 20 consecutive years.
Turning now to our earnings. As you may have seen last week, we reported first quarter 2024 earnings of $1.97 a share. Throughout what was the warmest winter in Wisconsin history, we remained laser-focused on financial discipline, operating efficiency, and customer satisfaction, and we're confident that we can deliver another year of strong results in line with our guidance for 2024. As a reminder, we're guiding to a range of $4.80-$4.90 a share for the full year. This assumes normal weather going forward. And now I'd like to discuss the progress we're making in delivering affordable, reliable, and clean energy to the millions of customers who depend on us every single day.
As we work to shape our energy future, we continue to build new, efficient infrastructure to better serve our customers and to meet the aggressive environmental goals that we have in place. In fact, some of the most aggressive goals in our industry for reducing carbon and methane emissions. Across our power-generating fleet, we're targeting an 80% reduction in carbon emissions by the end of 2030 from a 2005 baseline. And we now plan to eliminate coal as a fuel source for power generation three years earlier than previously planned, by the end of the year 2032. In fact, later this month, we'll be closing two of our oldest coal units at our Oak Creek site south of Milwaukee. Another two units will be retired in 2025.
Scott Lauber, our Chief Executive, will tell you more about our plans for the Oak Creek site in just a few minutes. Of course, for the longer term, we remain focused on achieving net zero carbon emissions from power generation by 2050. Turning now to the significant growth opportunities that we see ahead. We're driving forward on our $23.7 billion investment plan. It's the largest five-year investment plan in our company's history. The plan is focused on efficiency, sustainability, and the energy needs of a growing customer base. Highlights of the plan include a significant increase in renewable energy, as well as efficient natural gas generation and liquefied natural gas storage for our regulated utilities. To help assure energy security for our customers, we're also focused on strengthening our distribution network and investing in needed transmission across the region.
The building blocks of our capital plan clearly support our long-term earnings growth, which we project to be in the 6.5%-7% range on a compound average annual basis. Now I'll turn the meeting over to Scott Lauber, our President and Chief Executive. Scott, all yours.
Thank you, Gale. As Gale mentioned, we're executing on our ESG progress plan. Over the next five years, we'll continue to transform our generation fleet and reduce carbon dioxide emissions. We are investing in new solar, wind, and battery storage, as well as modern, efficient natural gas generation. Importantly, these investments are needed to meet the growth of the regional economy. Looking back at the close of 2023, I'm pleased to report that the final panels at the Badger Hollow Solar Park went into service, completing the largest solar project in Wisconsin's history. Our Wisconsin utilities own a total of 200 megawatts of solar capacity at Badger Hollow, which is located in the southwestern part of the state. We also brought 128 megawatts of new natural gas generation online.
As you may recall, we invested $170 million to build this generation at our Weston Power Plant site in northern Wisconsin. The facility uses seven reciprocating internal combustion engines, or as we call them, RICE units, for highly efficient and flexible operations. Elsewhere in Wisconsin, we closed on the first option of West Riverside Energy Center in 2023, adding efficient, combined-cycle natural gas generation to our portfolio. This February, we received Public Service Commission approval to purchase an additional 100 megawatts of capacity there. In addition, our Bluff Creek and Ixonia LNG storage facilities are now in service. Liquefied natural gas will help us meet peak customer demand for heating, as well as gas supply needed for power generation. This storage will be necessary during the extreme weather events like we experienced in mid-January.
We also have sourced renewable natural gas, or RNG, from local dairy farms. RNG started flowing in our distribution system for the first time last year. This replaces a portion of the conventional natural gas that would have entered our pipes. This effort contributes to our methane reduction goal and benefits the land and water of America's heartland. Just last month, we submitted filings to the Public Service Commission for significant developments in our electric generation business. Our proposed projects include two new sources of natural gas generation. The first request is for approval to build 1,100 megawatts of modern combustion turbines at our existing Oak Creek Power Plant site. The expected investment is $1.2 billion. These peaking units will serve as a critical resource as we continue to transform our fleet.
To support the power generation at our Oak Creek campus, we are proposing to build a 33-mile natural gas pipeline with an investment of approximately $180 million. For another source of reliable fuel, we are proposing a new LNG storage facility at Oak Creek with an investment of approximately $460 million. In addition, we're requesting approval to add RICE generation units near our Paris Generating Station. We expect to invest approximately $280 million in that project. Moving forward, our priorities can be summed up in three simple words: affordable, reliable, clean. With that, I'll turn it back to Gale.
Scott, thank you very much. Before we take your questions, I'd like to take just a moment to express my gratitude for the support you've so generously given me over the past 21 years. Effective tomorrow, I'll begin serving as the non-executive chairman of the board. Looking forward, I know we're in great hands with Scott and our leadership team. The company is well-positioned. Our future is bright. Now it's time for the question and answer portion of our meeting. Stockholders, of course, may submit questions online by clicking on the Q&A icon, and Peggy Kelsey has kindly agreed to read the questions for us.
All right, Gale, here's question number one. Warren Buffett has recently expressed concern about the future of private, profit-based utilities. He cites increasing regulation and litigation, which makes the return on investment difficult. Considering northern Illinois and its regulatory environment, customers not paying bills, what is your view of the long-term prospects for private utilities like WEC?
Well, thank you for the question. It's a great question, and I can, I think, give you a little bit of insight on the concerns expressed by Warren Buffett and his successor, Greg Abel. They, of course, own and have acquired, a number of years ago, a large utility system in the northwestern part of the United States. One of those utilities is named PacifiCorp, and again, it's part of the Warren Buffett Berkshire Hathaway Energy family of companies. They have experienced some significant wildfires in that part of the country, particularly in Oregon, and the result of those wildfires has been a voluminous number of lawsuits against PacifiCorp. In fact, I understand that they're facing more than $3 billion of potential legal liabilities.
That obviously has very much concerned the folks who run Berkshire Hathaway Energy. It's concerned Warren Buffett because in many instances, as you know, you know, these wildfires simply cannot be controlled by the electric distribution network and if proper maintenance is done, you know, we've seen the same thing, for example, in California. Now, the Warren Buffett letter got a lot of w here he questioned the future of utilities, particularly with wildfire exposure, obviously got a lot of appropriate attention. But a couple of developments that might give you some insight, I mean, first of all, there has now been legislation passed in California, which gives the California utilities significant legal protection if they properly maintain their systems and are certified as doing so.
And then, just a week or so ago, at the, at the Berkshire Hathaway annual meeting, Warren Buffett's successor mentioned that there's model legislation being developed in Idaho, where Berkshire Hathaway also has a utility operation, that he thinks can go a long way toward properly protecting utility property and utility assets from legal liability over which they really have no control related to wildfires. So I, I think obviously this is a serious issue for us, and there's really good news here for our company. If you look at a map, and it's available online, that is really updated regularly by the Federal Emergency Management Agency, FEMA, that map shows which areas of the country have the most exposure to serious wildfires.
Wisconsin is in the yellow, and in this case, you want to be yellow, because that shows that we have among the lowest wildfire risk anywhere in the United States. I hope that responds to your question.
Thank you, Gale. Question number 2: What % of generating sources will be renewable and coal in 2024, and will these be up or down from the previous year?
Great question, and Scott has those statistics right in front of him. Scott?
Sure, Gale. When you look at our coal, and these are the specific statistics for the end of 2023, we were at 32% of our generation to supply was from coal. That's down from 2005 of 73%. So we're down to 32%, and as we said in our prepared remarks, we are closing two coal units at the end of this month, and then two more coal units at the end of 2025. And we have a plan and a path to reduce coal to only a backup in 2030. So we expect to be less than 2% in 2030, if we can continue to execute on this plan as we execute on it.
As Scott indicated, that plan that we have should help us achieve one of our major environmental goals, an 80% reduction in CO2 emissions by the end of 2030. So we think we have a solid operating plan that really captures what Scott talks about when we talk about affordable, reliable, clean.
All right, here's our next question. To promote a diverse political workplace, does WEC have in place a policy to protect employees' religious and political beliefs and encourage free expression in the work environment?
Well, I think that the short answer is, part of our values, part of how we've always worked with folks and maintained a really diverse employee workforce, is to respect individual rights, individual views, but to focus on what we need to get done, to focus on our work, to focus on efficiency and driving the company forward. But yes, we have a very specific policy in place that talks about respect for individual beliefs and individual values.
Thank you. Next up, we actually have a statement from a shareholder in Port Washington, Wisconsin, Joe Dean. It's a long one. Thank you to the WEC team for your stewardship of the precious resource, which is We Energies. As a shareholder, the financial performance of WEC has consistently led and continues to lead the industry. In terms of economic development, your work in keeping the lights on has been a tremendous catalyst for over 500,000 businesses and employers, along with millions of families and individuals in our service area and beyond. As a former mayor, founder of Stars and Stripes Honor Flight, and as an advocate for childhood cancer research, it is heartwarming to know that the employees of We Energies and the We Energies Foundation continue to step up and help those most vulnerable among us.
Our hospitals and public safety facilities are able to thrive and provide life-saving services, thanks to the dedication and teamwork of WEC employees and the vision of your leadership team. In a difficult environment with seemingly competing interests, WEC continues to thread the needle, powering the future by providing clean, affordable energy, always with an eye toward and commitment to protecting our environment. As an enthusiastic tree hugger, I am grateful. Your stewardship of the shareholders' company and your commitment to community through philanthropy, empathy, and dedicated employees, along with your service to charitable causes, ranging from veterans affairs, community health and wellness, and the arts, reminds us all of what it means to be a good neighbor. Special thanks to Gale Klappa for his kind and extraordinary leadership.
Oh, my goodness. Thank you, Joe. Really appreciate those comments. And for those of you from all over the world listening in, I know we have shareholders from Europe listening in, who may not know who Joe Dean is. He's a tremendous human being. I got to know Joe personally when we were working to build new efficient power generation in Port Washington, when Joe was very involved with the government in Port Washington. But Joe, by the way, founded Stars and Stripes Honor Flight, which has been a tremendous, tremendous undertaking, flying World War II and other war veterans to see their memorials in Washington. So coming from you, Joe, that means a lot. Thank you very much. All right, Peggy, go right ahead.
Okay. Next is a comment or a request: when presenting results, you should provide the percent rating for each item to indicate the strength of support for the item.
Well, we have preliminary results, which I think we can certainly walk you through.
All right.
We're pulling them up right now-
You're going to grab them, right?
Make sure we have the latest.
Gonna grab them right now, keeping in mind these are preliminary. So I will give you a general sense of where we are in response to our question. And just to respond directly, the reason we don't give specific percentages is because the results are preliminary and coming in as we're leading up to the meeting, and shareholders, of course, are entitled to vote during the meeting. So what I will tell you, again, these are preliminary results. Starting with the election of directors, I will tell you all directors have at least 93% of the votes shared in favor. Moving on to the ratification of auditors, at least 94% of the votes shared are in favor. Moving on to Say-on-Pay, at least 94% of the voted shares are in favor. Moving on to our request to increase the authorized shares of common stock.
Again, a reminder, this is based on the percent of the outstanding shares, and 82% of the outstanding shares are in favor. With respect to Mr. Chevedden's stockholder proposal about simple majority vote, preliminarily, 95% of the voted shares are in favor. Again, I remind you, these are preliminary, and we will file the final results with the Securities and Exchange Commission in the coming days. Gale?
Very good. Thank you, Peggy. All right, looks like we have another question.
All right, here's your next question: Can you comment on the regulatory environment in Northern Illinois? How do things stand with pipeline replacement and receiving a fair return on investment through rate decisions?
Well, I think the short answer is, we will know a lot more about the immediate future by June one. Just to remind all of our shareholders, we received, as did, virtually every other utility in the state of Illinois, disappointing decisions from the Illinois Commerce Commission in November and December of last year. In our particular case, for the gas distribution company that we operate in Chicago, Peoples Gas, we were ordered by the Illinois Commerce Commission to stop, to cease investment in pipe replacement in Chicago. We have been undertaking there for years, really, even prior to our acquisition of the company, an important safety modernization program for the aging natural gas distribution network under Chicago. We think that's a very important project that needs to continue for many reasons, the most important of which is safety.
So the Illinois Commerce Commission ordered us to stop until they step back for probably a year to evaluate the future of our safety modernization program. We then applied to the commission for a limited rehearing, noting to them that there's emergency work that simply has to be done. There's work—I think we had holes in streets in 15 different neighborhoods from safety modernization upgrades underway, and we need to work with the city of Chicago as it replaces aging water mains. So we've asked to be allowed to continue with about $145 million worth of that type of work in 2024. The commission granted us a limited rehearing. All the testimony and all the views are in now from all the parties, and the Illinois Commerce Commission will make a decision.
I think their statutory requirement is by June 1. Scott, anything you'd like to add?
No, you're exactly right, Gale. We'll know more by the end of the month here, beginning of June, and, you know, we looked- I looked at every one of those projects we had to do for emergency, and they're very critical to the safety of Chicago people.
I would just remind everyone that Chicago has one of the oldest natural gas distribution networks in America. We're upgrading pipes and removing pipes that date back literally to the 1800s. So, we take this very seriously, and our commitment is to keep Chicago safe.
Gale, there are no more questions for you today.
All right, well, I guess we've exhausted you already. So at any rate, this concludes our 2024 annual meeting. If you have additional questions or would like more information, please feel free to email us at stockholder-services@wecenergygroup.com. Please be assured, ladies and gentlemen, that our management team will work hard in the year ahead to uphold your confidence. Thank you again, everyone. Good afternoon.
You may now disconnect.