- Higher utility margin due to:
- The settlement of a North Carolina rate case, which is pending before the North Carolina Utilities Commission (NCUC);
- An Integrity Management Rider (IMR) in North Carolina, which is pending before the NCUC as part of the North Carolina rate case settlement;
- An IMR in Tennessee, which is pending before the Tennessee Regulatory Authority;
- Gross utility customer additions of about 1.5% in the Company's three state market area; and
- The full year impact of the Sutton power generation delivery project that went into service in fiscal year 2013.
- Higher Operations and Maintenance (O&M) expense of about 3% due to increased regulatory asset amortizations under the North Carolina rate case settlement and higher utility operations expense to support pipeline integrity, safety and compliance programs.
- Higher depreciation expense due to additional utility plant in service, partially offset by lower depreciation rates under the North Carolina rate case settlement.
- Increased contributions from joint venture equity method investments as a result of SouthStar's expansion into Illinois, increased Allowance for Funds Used During Construction (AFUDC) at Constitution Pipeline, and the full-year impact of a higher ownership percentage of Pine Needle LNG.
- Capital expenditures in the range of $425 - $475 million, including approximately $250 million related to system integrity projects, as well as an additional $55 million to fund the Company's joint venture equity interest in the Constitution Pipeline project.
- Lower AFUDC of about $12 million reflecting forecasted capital expenditure levels and project schedules.
- Higher interest expense primarily due to the full-year impact of the Company's $300 million long-term debt issuance in fiscal year 2013.
- The issuance of new long-term debt and equity capital over fiscal years 2014 and 2015, at such amounts to support the Company's capital investment program and maintain the Company's long term targeted capital ratios of 45% - 50% long-term debt and 50% - 55% equity.
Piedmont Natural Gas Initiates Fiscal Year 2014 Earnings Guidance
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