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false0000784977 0000784977 2019-08-02 2019-08-02


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 
 
FORM
8-K
 
 
 
CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 2, 2019

 
 
 
PORTLAND GENERAL ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
 
 
 
 
 
 
Oregon
001-5532-99
     93-0256820          
(State or other jurisdiction
of incorporation)
(Commission
File Number)
     (I.R.S. Employer          
     Identification No.)          
121 SW Salmon Street, Portland, Oregon 97204
(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (503) 464-8000
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
(Title of class)
(Trading Symbol)
(Name of exchange on which registered)
Common Stock, no par value
POR
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

 




Item 2.02    Results of Operations and Financial Condition.

The following information is furnished pursuant to Item 2.02.

On August 2, 2019, Portland General Electric Company (PGE or the Company) issued a press release announcing its financial results for the three and six month periods ended June 30, 2019. The press release is furnished herewith as Exhibit 99.1 to this Report.

Item 7.01    Regulation FD Disclosure.

The following information is furnished pursuant to Item 7.01.

At 11:00 a.m. ET on Friday, August 2, 2019, the Company will hold its quarterly earnings call and webcast, and will use a slide presentation in conjunction with the earnings call. A copy of the slide presentation is furnished herewith as Exhibit 99.2 to this Report.

Item 9.01
Financial Statements and Exhibits.

(d)
 
Exhibits.
99.1
 
99.2
 
104
 
Cover page information from Portland General Electric Company’s Current Report on Form 8-K filed August 2, 2019, formatted in iXBRL (Inline Extensible Business Reporting Language).


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 
 
 
 
PORTLAND GENERAL ELECTRIC COMPANY
 
 
 
 
(Registrant)
 
 
 
 
 
Date:
August 1, 2019
 
By:
/s/ James F. Lobdell
 
 
 
 
James F. Lobdell
 
                                                                             
 
 
Senior Vice President of Finance,
Chief Financial Officer and Treasurer


2
Exhibit


Exhibit 99.1
 
https://cdn.kscope.io/068d5e4515e3a220d2a02d9b81562e8c-logoa04.jpg
Portland General Electric
One World Trade Center
121 S.W. Salmon Street
Portland, Oregon 97204

News Release
 
 
 
 
 
 
August 2, 2019
 
 
 
 
 
 
 
Media Contact:
 
Investor Contact:
 
Andrea Platt
 
Chris Liddle
 
Corporate Communications
 
Investor Relations
 
Phone: 503-464-7980
 
Phone: 503-464-7458

Portland General Electric announces second quarter 2019 results

•
Filed 2019 Integrated Resource Plan; identified need for 150 MWa renewable resources, energy efficiency, demand response and actions to add more capacity
•
Plans to construct an Integrated Operations Center centralizing key resilience and reliability functions
•
Maintaining full year 2019 earnings guidance of $2.35-$2.50 per share

PORTLAND, Ore. -- Portland General Electric Company (NYSE: POR) today reported net income of $25 million, or 28 cents per diluted share, for the second quarter of 2019. This compares with net income of $46 million, or 51 cents per diluted share, for the second quarter of 2018.

“This quarter, we navigated challenging regional power markets with significantly lower hydro production and are maintaining full year guidance,” said Maria Pope, PGE president and CEO, “We are also pleased to have filed our Integrated Resource Plan and to announce the construction of an Integrated Operations Center, which will enhance grid safety, resilience and security.”

Q2 2019 earnings compared to Q2 2018 earnings
Net variable power costs were less favorable than the prior year, primarily due to lower wholesale revenues and significantly lower than average hydro production. Higher operating expenses and lower production tax credits were partially offset by an increase in revenue as a result of the 2019 general rate case.
Company Updates
Integrated Resource Plan (IRP)
On July 19, 2019, PGE filed with the Public Utility Commission of Oregon its 2019 IRP including an Action Plan proposing resource actions to undertake through 2025. The Action Plan calls for adding more renewable resources, increased energy efficiency, demand-response, and actions to address capacity needs. A request for proposal (RFP) will be conducted to add new renewable resources by 2023. PGE anticipates a staged process that pursues cost competitive agreements for existing capacity in the region and will address remaining capacity needs with an RFP for non-emitting resources. PGE is considering submission of a benchmark resource for both RFPs and will communicate its decision to submit a benchmark before doing so. PGE expects an Order acknowledging the IRP and Action Plan in early 2020. 



1


Integrated Operations Center (IOC)
PGE will construct an IOC that centralizes key operations and functions in a facility designed for enhanced resilience against seismic, cyber and physical security risks. It is expected to be in service by the end of 2021. Technology within the IOC will enable PGE to better monitor, control, optimize and safely operate the company’s distribution system. It will also maximize the use of carbon-free energy in PGE’s system and enhance overall system reliability.

2019 earnings guidance

PGE is affirming its 2019 guidance of $2.35 to $2.50 per diluted share. This guidance is based on the following assumptions:
•
Increase in retail deliveries of 0.5%
•
Normal hydro conditions for the remainder of the year based on the current hydro forecast
•
Wind generation based on five years of historical levels or forecast studies when historical data is not available
•
Normal thermal plant operations
•
Depreciation and amortization expense between $400 million and $420 million
•
Revised operating and maintenance costs between $600 million and $620 million driven by an increase in distribution costs

Second Quarter 2019 earnings call and webcast — August 2, 2019

PGE will host a conference call with financial analysts and investors on Friday, August 2, 2019, at 11 a.m. ET. The conference call will be webcast live on the PGE website at investors.portlandgeneral.com. A replay of the call will be available beginning at 2 p.m. ET on Friday, August 2, 2019, through 2 p.m. ET on Friday, August 9, 2019.

Maria Pope, president and CEO; Jim Lobdell, senior vice president of Finance, CFO, and treasurer; and Chris Liddle, director, Investor Relations and Treasury, will participate in the call. Management will respond to questions following formal comments.

The attached unaudited condensed consolidated statements of income and comprehensive income, condensed consolidated balance sheets and condensed consolidated statements of cash flows, as well as the supplemental operating statistics, are an integral part of this earnings release.

# # #

About Portland General Electric Company

Portland General Electric (NYSE: POR) is a fully integrated energy company based in Portland, Oregon, serving more than 888,000 customers in 51 cities. For 130 years, PGE has been delivering safe, affordable and reliable energy to Oregonians. Together with its customers, PGE has the No. 1 voluntary renewable energy program in the U.S. With approximately 3,000 employees across the state, PGE is committed to helping its customers and the communities it serves build a clean energy future. For more information, visit PortlandGeneral.com/CleanVision.


2


Safe Harbor Statement
Statements in this news release that relate to future plans, objectives, expectations, performance, events and the like may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding earnings guidance; statements regarding future load, hydro conditions and operating and maintenance costs; statements concerning implementation of the company’s integrated resource plan; statements concerning future compliance with regulations limiting emissions from generation facilities and the costs to achieve such compliance; as well as other statements containing words such as “anticipates,” “believes,” “intends,” “estimates,” “promises,” “expects,” “should,” “conditioned upon,” and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including reductions in demand for electricity; the sale of excess energy during periods of low demand or low wholesale market prices; operational risks relating to the company’s generation facilities, including hydro conditions, wind conditions, disruption of fuel supply, and unscheduled plant outages, which may result in unanticipated operating, maintenance and repair costs, as well as replacement power costs; failure to complete capital projects on schedule or within budget, or the abandonment of capital projects, which could result in the company’s inability to recover project costs; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric and energy markets conditions, which could affect the availability and cost of purchased power and fuel; changes in capital market conditions, which could affect the availability and cost of capital and result in delay or cancellation of capital projects; the outcome of various legal and regulatory proceedings; general economic and financial market conditions; severe weather conditions, wildfires, and other natural phenomena and natural disasters that could result in operational disruptions, unanticipated restoration costs, or liability for third party property damage; and cyber security breaches of the company’s customer information system or operating systems, which may affect customer bills or other aspects of our operations. As a result, actual results may differ materially from those projected in the forward-looking statements. All forward-looking statements included in this news release are based on information available to the company on the date hereof and such statements speak only as of the date hereof. The company expressly disclaims any current intention to update publicly any forward-looking statement after the distribution of this release, whether as a result of new information, future events, changes in assumptions or otherwise. Prospective investors should also review the risks, assumptions and uncertainties listed in the company’s most recent annual report on form 10-K and in other documents that we file with the United States Securities and Exchange Commission, including management’s discussion and analysis of financial condition and results of operations and the risks described therein from time to time.


POR
Source: Portland General Company



3

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
(Dollars in millions, except per share amounts)
(Unaudited)

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
Revenues:
 
 
 
 
 
 
 
Revenues, net
$
462

 
$
449

 
$
1,032

 
$
944

Alternative revenue programs, net of amortization
(2
)
 
—

 
1

 
(2
)
Total revenues
460

 
449

 
1,033

 
942

Operating expenses:
 
 
 
 
 
 
 
Purchased power and fuel
105

 
104

 
284

 
234

Generation, transmission and distribution
86

 
71

 
163

 
140

Administrative and other
78

 
70

 
149

 
139

Depreciation and amortization
101

 
93

 
202

 
185

Taxes other than income taxes
33

 
31

 
67

 
64

Total operating expenses
403

 
369

 
865

 
762

Income from operations
57

 
80

 
168

 
180

Interest expense, net
31

 
31

 
63

 
62

Other income:
 
 
 
 
 
 
 
Allowance for equity funds used during construction
2

 
2

 
5

 
6

Miscellaneous income, net
—

 
1

 
2

 
—

Other income, net
2

 
3

 
7

 
6

Income before income tax expense
28

 
52

 
112

 
124

Income tax expense
3

 
6

 
14

 
14

Net income
25

 
46

 
98

 
110

Other comprehensive income
1

 
—

 
2

 
—

Comprehensive income
$
26

 
$
46

 
$
100

 
$
110

 
 
 
 
 
 
 
 
Weighted-average common shares outstanding (in thousands):







Basic
89,357


89,215


89,333


89,188

Diluted
89,561


89,215


89,537


89,188

 
 
 
 
 
 
 
 
Earnings per share:











Basic
$
0.28


$
0.51


$
1.10


$
1.23

Diluted
$
0.28


$
0.51


$
1.09


$
1.23

 
 
 
 
 
 
 
 


4

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
(Unaudited)
 
 
June 30,
2019
 
December 31,
2018
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
11

 
$
119

Accounts receivable, net
150

 
193

Unbilled revenues
72

 
96

Inventories
101

 
84

Regulatory assets—current
37

 
61

Other current assets
69

 
90

Total current assets
440

 
643

Electric utility plant, net
6,952

 
6,887

Regulatory assets—noncurrent
380

 
401

Nuclear decommissioning trust
46

 
42

Non-qualified benefit plan trust
37

 
36

Other noncurrent assets
142

 
101

Total assets
$
7,997

 
$
8,110

 
 
 
 

5

 
June 30,
2019
 
December 31,
2018
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
119

 
$
168

Liabilities from price risk management activities—current
40

 
55

Short-term debt
17

 
—

Current portion of long-term debt
—

 
300

Current portion of finance lease obligation
17

 
—

Accrued expenses and other current liabilities
247

 
268

Total current liabilities
440

 
791

Long-term debt, net of current portion
2,377

 
2,178

Regulatory liabilities—noncurrent
1,365

 
1,355

Deferred income taxes
379

 
369

Unfunded status of pension and postretirement plans
312

 
307

Liabilities from price risk management activities—noncurrent
76

 
101

Asset retirement obligations
199

 
197

Non-qualified benefit plan liabilities
101

 
103

Finance lease obligations, net of current portion
137

 
—

Other noncurrent liabilities
69

 
203

Total liabilities
5,455

 
5,604

Commitments and contingencies
 
 
 
Shareholders’ Equity:
 
 
 
Preferred stock, no par value, 30,000,000 shares authorized; none issued and outstanding as of June 30, 2019 and December 31, 2018
—

 
—

Common stock, no par value, 160,000,000 shares authorized; 89,371,560 and 89,267,959 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively
1,215

 
1,212

Accumulated other comprehensive loss
(7
)
 
(7
)
Retained earnings
1,334

 
1,301

Total shareholders’ equity
2,542

 
2,506

Total liabilities and shareholders’ equity
$
7,997

 
$
8,110

 


6

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 
Six Months Ended June 30,
 
2019
 
2018
Cash flows from operating activities:
 
 
 
Net income
$
98

 
$
110

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
202

 
185

Deferred income taxes
6

 
6

Pension and other postretirement benefits
12

 
13

Allowance for equity funds used during construction
(5
)
 
(6
)
Decoupling mechanism deferrals, net of amortization
(1
)
 
2

(Amortization) Deferral of net benefits due to Tax Reform
(11
)
 
25

Other non-cash income and expenses, net
21

 
4

Changes in working capital:
 
 
 
Decrease in accounts receivable and unbilled revenues
63

 
26

(Increase) in inventories
(17
)
 
(7
)
Decrease in margin deposits, net
11

 
4

(Decrease) in accounts payable and accrued liabilities
(65
)
 
(20
)
Other working capital items, net
16

 
13

Other, net
(16
)
 
(17
)
Net cash provided by operating activities
314

 
338

Cash flows from investing activities:
 
 
 
Capital expenditures
(271
)
 
(266
)
Sales of Nuclear decommissioning trust securities
7

 
6

Purchases of Nuclear decommissioning trust securities
(5
)
 
(5
)
Other, net
(2
)
 
—

Net cash used in investing activities
(271
)
 
(265
)
Cash flows from financing activities:
 
 
 
Proceeds from issuance of long-term debt
$
200

 
$
—

Payments on long-term debt
(300
)
 
—

Issuance of commercial paper, net
17

 
—

Dividends paid
(65
)
 
(61
)
Other
(3
)
 
(3
)
Net cash used in financing activities
(151
)
 
(64
)
(Decrease) increase in cash and cash equivalents
(108
)
 
9

Cash and cash equivalents, beginning of period
119

 
39

Cash and cash equivalents, end of period
$
11

 
$
48

 
 
 
 
Supplemental cash flow information is as follows:
 
 
 
Cash paid for interest, net of amounts capitalized
$
60

 
$
58

Cash paid for income taxes
20

 
10


7

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
SUPPLEMENTAL OPERATING STATISTICS
(Unaudited)

 
Three Months Ended June 30,
 
2019
 
2018
Revenues (dollars in millions):
 
 
 
 
 
 
 
Retail:
 
 
 
 
 
 
 
Residential
$
205

 
45
 %
 
$
207

 
46
 %
Commercial
158

 
34

 
162

 
36

Industrial
50

 
11

 
39

 
9

Direct access
10

 
2

 
13

 
3

Subtotal
423

 
92

 
421

 
94

Alternative revenue programs, net of amortization
(2
)
 
—

 
—

 
—

Other accrued (deferred) revenues, net
6

 
1

 
(10
)
 
(2
)
Total retail revenues
427

 
93

 
411

 
92

Wholesale revenues
16

 
3

 
24

 
5

Other operating revenues
17

 
4

 
14

 
3

Total revenues
$
460

 
100
 %
 
$
449

 
100
 %
 
 
 
 
 
 
 
 
Energy deliveries (MWh in thousands):
 
 
 
 
 
 
 
Retail:
 
 
 
 
 
 
 
Residential
1,526

 
29
 %
 
1,612

 
29
 %
Commercial
1,630

 
31

 
1,654

 
30

Industrial
802

 
15

 
717

 
13

Subtotal
3,958

 
75

 
3,983

 
72

Direct access:
 
 
 
 
 
 
 
Commercial
177

 
3

 
159

 
3

Industrial
360

 
7

 
342

 
6

Subtotal
537

 
10

 
501

 
9

Total retail energy deliveries
4,495

 
85

 
4,484

 
81

Wholesale energy deliveries
785

 
15

 
1,041

 
19

Total energy deliveries
5,280

 
100
 %
 
5,525

 
100
 %
 
 
 
 
 
 
 
 
Average number of retail customers:
 
 
 
 
 
 
 
Residential
777,564

 
88
 %
 
771,608

 
88
 %
Commercial
109,190

 
12

 
108,939

 
12

Industrial
192

 
—

 
205

 
—

Direct access
634

 
—

 
596

 
—

Total
887,580

 
100
 %
 
881,348

 
100
 %





8

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
SUPPLEMENTAL OPERATING STATISTICS, continued
(Unaudited)


Three Months Ended June 30,

2019

2018
Sources of energy (MWh in thousands):







Generation:







Thermal:











Natural gas
1,150


23
%

828


16
%
Coal
378


8


421


8

Total thermal
1,528


31


1,249


24

Hydro
460


9


395


8

Wind
608


13


613


11

Total generation
2,596


53


2,257


43

Purchased power:







Term
1,919


39


2,384


45

Hydro
319


6


500


10

Wind
82


2


94


2

Total purchased power
2,320


47


2,978


57

Total system load
4,916


100
%

5,235


100
%
Less: wholesale sales
(785
)



(1,041
)


Retail load requirement
4,131




4,194









The following table indicates the number of heating and cooling degree-days for the three months ended June 30, 2019 and 2018, along with 15-year averages based on weather data provided by the National Weather Service, as measured at Portland International Airport:


 
Heating Degree-days
 
Cooling Degree-days
 
2019
 
2018
 
Avg.
 
2019
 
2018
 
Avg.
April
312

 
338

 
376

 
—

 
9

 
2

May
109

 
89

 
198

 
28

 
34

 
21

June
46

 
44

 
79

 
74

 
73

 
65

Totals for the quarter
467

 
471

 
653

 
102

 
116

 
88

(Decrease)/increase from the 15-year average
(28
)%
 
(28
)%
 
 
 
16
%
 
32
%
 
 


9
finalex99220190630ecslid
Exhibit 99.2 Portland General Electric Earnings Conference call Second quarter 2019

 
Cautionary statement Information current as of August 2, 2019 Except as expressly noted, the information in this presentation is current as of August 2, 2019 — the date on which PGE filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 — and should not be relied upon as being current as of any subsequent date. PGE undertakes no duty to update this presentation, except as may be required by law. Forward-looking statements Statements in this presentation that relate to future plans, objectives, expectations, performance, events and the like may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding earnings guidance; statements regarding future load, hydro conditions and operating and maintenance costs; statements concerning implementation of the company’s integrated resource plan; statements concerning future compliance with regulations limiting emissions from generation facilities and the costs to achieve such compliance; as well as other statements containing words such as “anticipates,” “believes,” “intends,” “estimates,” “promises,” “expects,” “should,” “conditioned upon,” and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including reductions in demand for electricity; the sale of excess energy during periods of low demand or low wholesale market prices; operational risks relating to the company’s generation facilities, including hydro conditions, wind conditions, disruption of fuel supply, and unscheduled plant outages, which may result in unanticipated operating, maintenance and repair costs, as well as replacement power costs; failure to complete capital projects on schedule or within budget, or the abandonment of capital projects, which could result in the company’s inability to recover project costs; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric and energy markets conditions, which could affect the availability and cost of purchased power and fuel; changes in capital market conditions, which could affect the availability and cost of capital and result in delay or cancellation of capital projects; the outcome of various legal and regulatory proceedings; general economic and financial market conditions; severe weather conditions, wildfires, and other natural phenomena and natural disasters that could result in operational disruptions, unanticipated restoration costs, or liability for third party property damage; and cyber security breaches of the company’s customer information system or operating systems, which may affect customer bills or other aspects of our operations. As a result, actual results may differ materially from those projected in the forward-looking statements. All forward-looking statements included in this presentation are based on information available to the company on the date hereof and such statements speak only as of the date hereof. The company expressly disclaims any current intention to update publicly any forward-looking statement after the distribution of this presentation, whether as a result of new information, future events, changes in assumptions or otherwise. Prospective investors should also review the risks, assumptions and uncertainties listed in the company’s most recent annual report on form 10-K and in other documents that we file with the United States Securities and Exchange Commission, including management’s discussion and analysis of financial condition and results of operations and the risks described therein from time to time. 2

 
Leadership presenting today Maria Pope President and CEO On today's call • Financial performance • Economic and legislative update • 2019 Integrated Resource Plan • Integrated Operations Center • Capital planning update Jim Lobdell • Financial update Senior VP of Finance, CFO & Treasurer 3

 
Second quarter 2019 earnings results Q2 2019 Q2 2018 Net income (in $ millions) $25 $46 Diluted earnings per share (EPS) $0.28 $0.51 $0.82 $0.72 $1.25 - $1.40* $0.59 $0.55 $0.28 $0.51 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 Diluted EPS: 2018 Diluted EPS: $2.35 - $2.50 $2.37 4 *Estimates based on 2019 guidance range

 
Economic and legislative updates Our economy is strong • Retail energy deliveries increased 0.8% on a weather-adjusted basis, driven by industrial energy deliveries • Unemployment rate of 3.5% in our service area* • Long term expansion in high tech and data centers Our 2019 session achievements • Reducing transportation GHG emissions, boosting EV adoption to support Oregon's climate goals • Providing additional energy efficiency measures for low-income customers • Continuing work toward cost-effective energy and climate policies *PGE-3 County Average, June 2019, Source: State of Oregon Employment Department 5

 
2019 Integrated Resource Plan July 2019 Q3-Q4 2019 January 2020 IRP filed Comments filed by Staff/ Staff memorandum and Stakeholders/PGE final order expected The plan reflects our focus on meeting customer needs and addressing stakeholder feedback Action Plan • Customer resource actions - increased energy efficiency, demand response, storage and dispatchable standby generation • Renewable resource actions - a renewable RFP of 150 MWa, estimated online 2023 • Capacity resource actions - a multi-stage procurement process for approximately 595 MW of cost-competitive capacity 6

 
Integrated Operations Center A new 24/7 center for key operations: • Advances our integrated grid strategy • Significantly improves seismic resilience, cyber and physical security • Improves monitoring, control and optimization of distributed assets and our distribution system 7

 
Second quarter 2019 earnings bridge $0.51 $2.10 $(0.07) $(0.05) $0.01 $0.28 $(0.07) $(0.05) Q2 Revenues, Weather Operating Production Other Q2 2018 purchased and expense tax credits 2019 power and decoupling fuel* 8 *Revenues include retail revenues, wholesale revenues and other operating revenues

 
Capital planning 800 $725 700 $620 $585 600 $505 $500 500 400 300 200 100 0 2019 2020 2021 2022 2023 Ongoing capital expenditures Wheatridge Renewable Energy Facility Integrated Operations Center Investments include: • Updating, replacing aging generation, transmission and distribution equipment • Investments to construct the Integrated Operations Center • Strengthening the power grid for earthquakes, cyberattacks and other potential threats • Adding 100 MW of wind generation at Wheatridge Renewable Energy Facility 9 *Capital expenditures for 2019 through 2023 exclude allowance for funds used under construction

 
Liquidity and financing Total Liquidity 2019 Ratings S&P Moody's (as of 6/30/19) (in $ millions) Credit Facilities $ 483 Senior Secured A A1 Letters of Credit 160 Senior Unsecured BBB+ A3 Cash 11 Commercial Paper A-2 Prime-2 Available $ 654 Outlook Positive Stable Financings Q1 2019 Q2 2019 Q3 2019 Q4 2019 Issued $200 million First Mortgage Issuing up to $230 million Bonds Repaid $300 million 10