Good afternoon, and welcome to WEC Energy Group's Conference Call for Second Quarter 2016 Results. This call is being recorded for rebroadcast, and all participants are in a listen-only mode at this time. Before the conference call begins, I remind you that all statements in this presentation, other than historical facts, are forward-looking statements that involve risks and uncertainties, which are subject to change at any time. Such statements are based on management's expectations at the time they are made. In addition to the assumptions and other factors referred to in connection with the statements, factors described in WEC Energy Group's latest Form 10-K and subsequent reports filed with the Securities and Exchange Commission could cause actual results to differ materially from those contemplated. During the discussions, referenced earnings per share will be based on diluted earnings per share unless otherwise noted. After the presentation, the conference will be open to analysts for questions and answers. In conjunction with this call, WEC has posted on its website a package of detailed financial information at wecenergygroup.com. A replay of management remarks will be available approximately two hours after the conclusion of this call. And now, it's my pleasure to introduce Allen Leverett, President and Chief Executive Officer of WEC Energy Group. Allen L. Leverett - President, Chief Executive Officer & Director: Thank you, Charlene. Thank you all for joining us today as we review our results for the second quarter of the year. Now before I do that, I want to introduce the members of our team who are here with me today. Scott Lauber, our Chief Financial Officer; Jim Schubilske, our Treasurer; Susan Martin, our General Counsel; Bill Guc, who is our Controller; and finally Beth Straka, who is Senior Vice President of Corporate Communications and Investor Relations. Now let's…

Thank you. And now we'd like to take your questions. The question-and-answer session will be conducted electronically. Your first question comes from the line of Greg Gordon with Evercore ISI. Please go ahead.

Thanks. Good afternoon. Allen L. Leverett - President, Chief Executive Officer & Director: Hi, Greg.

I apologize, I hopped on just a minute or two late. You guys, I was told, did increase your capital expenditure budget in the back half of the five-year plan. Can you go back and talk about how much of rate base growth was reduced by the impact of bonus depreciation? How much of that you had offset already prior to this update? And then how much incrementally you've found in customer-friendly projects that further mitigate that impact? Allen L. Leverett - President, Chief Executive Officer & Director: I'd be happy to, Greg. I think some review is good. And so the bonus depreciation extension, which was really a reach-back to 2015 as well as an extension out to, I guess, 2019, we think results in about $1 billion worth of cash tax benefits. So back on the February and the May calls we gave an update to everybody on where we stood versus offsetting that $1 billion. So as we got to the end of the May call, we had identified $500 million and those were primarily this year and next. So about $500 million between 2016 and 2017. And so now what we've identified is another $100 million in addition to that $500 million. So the $100 million is in the years 2019 and 2020. It's about $50 million a year, Greg. And what this relates to is really the continuation of a four-year program that they've had at Wisconsin Public Service. The first phase involved distribution automation as well as undergrounding of electric distribution. The second phase will be strictly devoted, we expect to the undergrounding of electric distribution. So about $50 million in 2019, $50 million in 2020, and we also believe out in 2021 and 2022, there is yet another $50 million a year to do in those two years. And this program, it's been very, very popular with customers and it was interesting, this summer, we've had quite a bit of storm activity in the Wisconsin Public Service territory, and for those that had their service, had these distribution lines undergrounded, they saw a much less in terms of outage times. So it's been a very popular program. I hope that helps, Greg.

No, that helps tremendously. And is this a continuous review process, and as we get into the next quarter and we get to EEI that you're continuing to try to observe where you could put more capital to work that has further benefits for customers or is this the end of that review? Allen L. Leverett - President, Chief Executive Officer & Director: Well, it's really more of the former, Greg. So we'll keep reviewing the numbers, reviewing the programs, but what we're trying to do is take a very deliberate approach, because I think the terminology that you used earlier is important. Each of these have to be customer-friendly projects. So there has to be a reliability benefit, a cost benefit, a safety benefit, or environmental performance. It's really got to be something that's beneficial to our business and beneficial to our customers. So often that takes a little time to identify those kinds of projects.

Great. To what extent could changes in the potential mix of your generation fleet, as you look to de-carbonize, have an impact on that plan towards the backend, or would that potentially roll into the next decade, so that as you look at your coal fleet, and you start to think about how you are going to balance your carbon emissions. Allen L. Leverett - President, Chief Executive Officer & Director: Yes. And I think certainly with Clean Power Plan, and this is, I'm speculating. I don't know exactly when the first year of compliance would be with Clean Power Plan, but it's likely not to be until 2024 or after. So I would not expect, Greg. Certainly if you look into the capital forecast going out to 2020, which is what we have on the table today, I don't really see any benefit at all, at least in this forecast period, meaning from this year to 2020, from the impacts of Clean Power Plan. But hypothetically if you had a 2024 compliance date, ultimately with Clean Power Plan, perhaps you could see some impacts out in that 2021, 2022, 2023 time period.

Okay. Two more quick questions. $0.55 to $0.59 assumes normal weather you said for the balance of the quarter, so I would presume it factors in what's happened to-date in terms of demand. Allen L. Leverett - President, Chief Executive Officer & Director: Yes. And Scott, you may want to talk a little bit about July and what we've seen in July in terms of weather. Scott J. Lauber - Chief Financial Officer & Executive Vice President: Yes. Yes. So it does include the month of July weather. Now, what we saw in July was it started out actually cooler than normal the first couple days and it didn't catch up to about normal degree day until about the July 17. So we really just had some warm weather the last week, week-and-a-half of July here. So we factored that in. Maybe it's $0.015 to $0.02, but that's factored into our guidance.

Okay. So we should watch the weather for the balance of the quarter and think about that accordingly if it's above or below normal, because you're assuming normal? Scott J. Lauber - Chief Financial Officer & Executive Vice President: Correct.

Okay. Final question. In the normal cadence of your discussions with the Wisconsin Commission, at what point do you go into them and discuss whether or not you'd like to defer having a rate review again as you did this year? Allen L. Leverett - President, Chief Executive Officer & Director: Yes. Well, my expectation would be, if we follow past practice on timing, typically if you're going to do a filing, so let's say, for example, if we're going to do a filing in 2017 for rates that we request to be in effect in 2018, typically in the March-April timeframe you really need to make that filing. So if we follow past practice with timing, my expectation would be that soon after the New Year, January, February, you'd need to have some conversations with the staff about where we would propose to head. So that's how I would see the timing.

Okay. So a ways off. Thank you, guys. Allen L. Leverett - President, Chief Executive Officer & Director: Yes. Scott J. Lauber - Chief Financial Officer & Executive Vice President: Thank you.

Your next question comes from the line of Jonathan Arnold with Deutsche Bank. Please go ahead.

Hi, Good afternoon. Allen L. Leverett - President, Chief Executive Officer & Director: Hello, Jonathan.

Two quick things. I heard your comments on the pension discount rate and I think you said you're working on building that into the plan, if you do see the $35 million increase in 2017. So should we take the comment of building it into the plant to mean you'd expect to absorb that within the stated growth rate? Allen L. Leverett - President, Chief Executive Officer & Director: Yes. And I would say, maybe, to give you some additional color. The $35 million, part of that, to the extent that you capitalize labor expense and there is a certain amount of labor that gets capitalized when people do work on capital projects, now there'll be some amount of this $35 million that would effectively get capitalized as a part of that. My guess would be, right now, perhaps that $6 million or $7 million out of the $35 million, so not all of it would hit the income statement. But, yes, we'll have to and we expect to offset this as a part of our plan.

Okay. Thank you. And then just on transmission return and how you've reserved, you mentioned the ALJ being 9.7% plus 50 basis point adder. Is that the number you've actually reserved to? And is that what you're looking on a go-forward basis or are those numbers different from what the ALJ? Allen L. Leverett - President, Chief Executive Officer & Director: Yes, let me go through it in three pieces, because of course there are two investigations, if you will. So, there is the first period that goes from, I think, November 2013, help me Scott... Scott J. Lauber - Chief Financial Officer & Executive Vice President: Sure. February 2015. Allen L. Leverett - President, Chief Executive Officer & Director: Right. And then we've got... Scott J. Lauber - Chief Financial Officer & Executive Vice President: February to May 2016. Allen L. Leverett - President, Chief Executive Officer & Director: ...2016. So in that first period, Jonathan, we're reserving I believe effectively the recommendation from the ALJ including the 50 basis points was 10.82%. So we're reserving at that level for that first period. For the second period, we're reserving at 10.2%, and then it's sort of an educated guess, but my view right now would be the that 10.2% is a pretty good assumption going forward and 10.2% is what we will assume when we build up our plan, when we finish our plan for 2017. I'm sorry, that's kind of a long answer, but there are all these players for these investigations.

No, that was very helpful. Thank you for the clarity on that. It's sometimes hard to keep track of. Thank you. Allen L. Leverett - President, Chief Executive Officer & Director: Okay?

Yes, that's all. Good, thanks a lot. Allen L. Leverett - President, Chief Executive Officer & Director: Thank you.

Your next question comes from the line of Steve Fleishman with Wolfe Research. Please go ahead. Allen L. Leverett - President, Chief Executive Officer & Director: Hello, Steve.

Yeah, hi, good afternoon. Just on the Illinois process, for the gas spending, just could you give a little more color on what is going to be kind of addressed in that process, just basically, let's finalize your new long-term investment plan? Allen L. Leverett - President, Chief Executive Officer & Director: Yeah, and maybe let me sort of give this, maybe in parts. And let me first maybe just give a little more color about that staff report, Steve, that that was issued at the end of May. So really what that report did, effectively the staff did not make any recommendations about the program effectively. What they did is, that the staff summarized all of kind of the key input from the stakeholders in that workshop process that they had earlier this year. Then what the staff just essentially said is, well, we believe you should have a docket to address the program. And we think you should have reporting mechanisms about the program in the interim before you make a decision and in the long-term once the decision is made. So really it's just kind of summary of what all the stakeholders said, and then in terms of what the commission would decide, at a high level what they said they want to do was cover the cost, scope and schedule for the near-term and the long-term. So, they still seemed to be of a very strong view that the program needs to continue. They just want to look again at the scope and the schedule, and in the interim, they fully understand that we're going to continue with that three-year program that I alluded to before, hopefully that's helpful, Steve.

Yeah. Yeah. No, that's helpful. Just one other question on the pension, thank you for disclosing that information. I assume we're going to start hearing a lot more from other people. The normal course I assume that's a recoverable expense in rate cases? Allen L. Leverett - President, Chief Executive Officer & Director: Yeah, FAS 87 expense would generally be recoverable in your revenue requirements.

Okay. And so, but just in 2017, to a degree you don't have a rate case you'd have to manage the cost? Allen L. Leverett - President, Chief Executive Officer & Director: Exactly right, Steve.

Okay. Thank you.

Your next question comes from the line of Julien Dumoulin-Smith with UBS. Please go ahead. Allen L. Leverett - President, Chief Executive Officer & Director: Hi there, Julien.

Hey, good afternoon. Allen L. Leverett - President, Chief Executive Officer & Director: Hey. Scott J. Lauber - Chief Financial Officer & Executive Vice President: Hi.

So perhaps a easy question here, just the dollar-for-dollar comment on the Presque Isle. Can you elaborate a little bit on what the assets there are? Allen L. Leverett - President, Chief Executive Officer & Director: Yeah. And I guess what I was really alluding to in the primary one or one of the ones is really escrow accounting, because sort of like when we talk about ROE investigations, these SSR agreements they were actually multiple agreements and they covered multiple periods. I think they go back as far as February of 2014.

Correct. Allen L. Leverett - President, Chief Executive Officer & Director: And there were actually two agreements over that period and some of these periods, Julien, were covered by escrow accounting, so you were actually required by the regulators in Wisconsin to escrow both revenues as well as costs, so both revenues you received under the contract as well as the costs that might be allocated back to our utility through MISO. So what I was really referring to primarily is that those escrow mechanisms that might cover one or both of the periods.

Got it. And just to be clear, I know this is Feb 14 through Jan 15, but would this have an ongoing impact just to 2016, 2017? Allen L. Leverett - President, Chief Executive Officer & Director: No.

Okay. Allen L. Leverett - President, Chief Executive Officer & Director: Because, the second SSR agreement, I believe ended in either February or April of 2015. Scott J. Lauber - Chief Financial Officer & Executive Vice President: February of 2015. Allen L. Leverett - President, Chief Executive Officer & Director: February of 2015, so this is all going back, Julien.

Got it. Thanks for that. Little bit more strategic here. I know last time on the call we kind of discussed storage little bit. Can you elaborate where you stand on that and also in the interim we've seen some of your large-cap peers move more explicitly into the midstream sector, what are your thoughts owning storage in midstream more broadly? Allen L. Leverett - President, Chief Executive Officer & Director: Right. And I think, well, first off on the storage, we are having conversations with two parties who are owners of storage and we'll see what we can work out with one of those, but we are having active conversations with two parties so let me just sort of put a line under that. And then looking forward, I guess our view would be on midstream, at least our view is that we would only be interested in these other natural gas assets and I'll just call them, I don't know whether to call them midstream or what to call them, Julien, but it's certainly upstream of the local gas distribution companies. Our only interest at this point would be in gas storage and it would be gas storage that we could in effect directly integrate with our local distribution company and place in rate base. So at this point, that's as far upstream as we're thinking, it's something that would be very much of another regulated asset play.

Got it. All right, great. Well, thank you. Allen L. Leverett - President, Chief Executive Officer & Director: Okay.

Your next question comes from the line of Brian Russo with Ladenburg Thalmann. Please go ahead. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Hi, good afternoon. Allen L. Leverett - President, Chief Executive Officer & Director: Hi, Brian. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Just curious, what was the second quarter 2016 EPS impact versus normal? Allen L. Leverett - President, Chief Executive Officer & Director: In terms of weather impact. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Yeah. Allen L. Leverett - President, Chief Executive Officer & Director: Scott, do you want to cover that? Scott J. Lauber - Chief Financial Officer & Executive Vice President: Yeah. The weather impact compared to normal, was about I think – all right, let me just pull our numbers up here. I think it was really only about $0.01. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Okay. So, then I guess, the delta between what you actually reported and what you had guided to last quarter, is attributable to cost controls and the tech acquisition that's exceeding our expectations? Allen L. Leverett - President, Chief Executive Officer & Director: Yeah. Initially as you recall on the first in April, it actually was a negative when we had the conference call, so we had earnings we thought were actually going to be down a little bit because of our April weather, and then as we covered then in the last part of the quarter here, so that helped us, so we had projected in our guidance a decline because of weather and then it turned round a little bit in the last part of the quarter here. And plus, we do have pretty good cost control and we saw some…

Your final question comes from the line of Michael Lapides with Goldman Sachs. Please go ahead. Allen L. Leverett - President, Chief Executive Officer & Director: Hi, Michael. Michael Lapides - Goldman Sachs & Co.: Hey, Allen. Couple of easy questions for you. First, how do you – you've got $35 million roughly, maybe a little less because of the capitalization of pension O&M headwind. You have the headwind tied to 50 basis point, 60 basis point lower ROE at ATC. Is your O&M, and you don't have rate increases coming at the Wisconsin utilities. Are your O&M cost savings enough to offset all of those things? Allen L. Leverett - President, Chief Executive Officer & Director: Well, I believe so, but I would say at the Wisconsin utilities you're probably looking at having to have absolute declines in the O&M run rate. So, Scott, anything you'd like to add? Scott J. Lauber - Chief Financial Officer & Executive Vice President: Yeah. No, that's exactly the case. We'll have to continue at our cost control and manage every dollar like we have in the past. We'll also look at what we do on our financing cost, and we've put in there, maybe there is some investments we need to do in the pension plan also. So, we're evaluating a lot of different items items. Allen L. Leverett - President, Chief Executive Officer & Director: But at this point, Michael, I would say that we still would have enough degrees of freedom that – so we could move to help offset this. Michael Lapides - Goldman Sachs & Co.: Got it. And O&M sequentially, meaning quarter-over-quarter, because the year-over-year is just complex given the merger close. Quarter-over-quarter was down $5 million, $6 million. Is that kind of a decent run rate…

Thank you. This concludes today's conference call. You may now disconnect.