Constellation Touts Pricing Higher Margins From Recent Volatility

August 6, 2024

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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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In discussing second quarter earnings, Joe Dominguez, president and CEO of Constellation, touted the ability of Constellation's commercial business to lock-in higher margins given recent volatility

"This quarter our [commercial] team priced in higher margins to customers to manage their exposure to volatile prices through firm products that offer price certainty," Dominguez said

Constellation reported seeing margins above the long-term averages used in previously reported forecasts and above the "enhanced" margins the company disclosed in February

Under its guidance, Constellation increased its enhanced gross margin line by $450 million, "due to better optimization of our portfolio and higher commercial margins than planned."

"Our expectations for enhanced commercial margins improved by $0.15 to $1.90 per megawatt hour, which is on top of our base commercial margin of $3.50 to $3.60 a megawatt hour," Constellation executives said

Constellation raised its full-year 2024 Adjusted (non-GAAP) Operating Earnings guidance range to $7.60-$8.40 per share from the previous guidance of $7.23 to $8.03 per share

Such increased guidance was driven, in part, by, "strong wholesale and retail performance with load auction wins and margin expansion," Constellation said

Constellation second quarter 2024 Retail Electric Load Served by Region was as follows:

Q2 2024 Retail Electric Load Served
  (TWh)

Midwest                    10
Mid-Atlantic               11
ERCOT                       4
New York                    4
New England/South/West      7

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