Portland General Electric Co · NYSE:POR
Portland General Electric — Investor Presentation (March 2019)
27 slides from Portland General Electric's investor presentation, March 2019
Slide 1: Investor Presentation
Investor Presentation Portland General Electric March 2019
Slide 2: Cautionary statement
Cautionary statement Information Current as of February 15, 2019 Except as expressly noted, the information in this presentation is current as of February 15, 2019 — the date on which PGE filed its Annual Report on Form 10-K for the year ended December 31, 2018 — and should not be relied upon as bei
Slide 3: PGE values
PGE values Investing in a 100% regulated High-growth reliable and clean utility service area energy future Focusing Delivering Building a on operational exceptional smarter more effectiveness customer resilient grid and efficiency experiences 3
Slide 4: The company
The company
Slide 5: PGE at a glance
PGE at a glance Quick facts(1) 3,800+ MWs of Generation • Vertically integrated electric company encompassing generation, transmission and distribution Beaver Montana Port Westward 1 & 2 Colstrip 3 & 4 • 885,000 customers in 51 Oregon incorporated cities (1) OREGON WASHINGTON Washington • 46 percent
Slide 6: Attractive, growing service area
Attractive, growing service area • 1%+ average annual customer count growth 1,000 1.20 • Above-average population Indexed Growth 2018=1 1.15 growth due to in-migration 800 1.10 Average MW • Oregon’s annual GDP 600 1.05 growth averaged 2.9% over the past two decades(1) 1.00 400 0.95 • Industrial segm
Slide 7: Constructive regulatory environment
Constructive regulatory environment Regulatory construct Regulatory body • Public Utility Commission of Oregon Governor-appointed three member commission serving four-year terms • Forward test year Term expiration • Integrated Resource Planning (IRP) Megan Decker [D] (Chair) March 2021 • Renewable P
Slide 8: 2019 General rate case
2019 General rate case Key Items • Approved price increase: 0.5% • Return on equity (ROE): 9.5% • Cost of long-term debt: 5.1% • Capital structure: 50% debt, 50% equity • Rate base: $4.75 billion Requests Approved by the Commission: • Energy storage projects associated with renewables can be include
Slide 9: Key strengths
Key strengths
Slide 10: Focus on customers
Focus on customers Top quartile Top quartile Most trusted brand No.1 renewable system customer & environmental energy program reliability satisfaction champion in the nation Edison Electric TQS Research, Inc. Market Strategies National Renewables Institute and Market Strategies International Energy
Slide 11: Diverse generation and customer base
Diverse generation and customer base Total system load Retail revenues by customer class 2018 Power Sources(1) 2018(2) Industrial 12% Hydro 20% Gas 44% Wind / Solar Residential 13% 52% Commercial 36% Coal 23% Total = 15,000 MW (2) Total = $1.8B(3) 1. Hydro and wind/solar include PGE-owned and contra
Slide 12: High-quality utility operations
High-quality utility operations Western Energy Imbalance ▪ Highly-dependable generation fleet with seven-year Market average availability of 92%(1) ▪ Strong power supply portfolio management and western EIM integration to enhance reliability and optimize resources ▪ Progressive approach to reduce co
Slide 13: Strong liquidity position for growth
Strong liquidity position for growth Revolving credit facilities(1) Financial resources (in $ millions) • Investment grade credit ratings • Manageable debt maturities • Target capital structure of 50% debt and 50% equity S&P Moody’s Available Credit + Senior Secured A A1 Cash Total Senior Unsecured
Slide 14: Solid financial performance
Solid financial performance Net Income, Earnings per Share, and ROE 2.5 (in $ millions) $2.37 $2.29(1) $2.18 2.3 $2.16 $2.04 2.1 $2.10(2) NI $204 1.9 EPS (diluted) $212 1.7 $193 $187 $175 $172 1.5 1.3 1.1 2014 2015 2016 2017(2) 2018 Accounting ROE 9.4% 8.3% 8.4% 7.9% 8.6% Allowed ROE 9.8% 9.7% 9.6%
Slide 15: Proven dividend growth
Proven dividend growth $1.41 $1.32 $1.24 $1.16 70% Target Payout Actual Payout $1.09 $1.11 Ratio Ratio $1.05 $1.07 $1.03 $1.00 50% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018E Future dividend increases expected to be in the 5-7% range(3) 1. Compound Annual Growth Rate from 2009 through 2018 2.
Slide 16: Looking Forward
Looking Forward
Slide 17: Clean and reliable energy future
Clean and reliable energy future Key elements Long-term strategy • Transition Oregon off coal-fired generation by 2030 • Layered approach balances near-term and long-term risks and • Production Tax Credits included in annual power cost benefits for customers filings since 2017 • Incremental renewabl
Slide 18: 2016 Integrated Resource Plan
2016 Integrated Resource Plan A flexible, balanced plan that reflects our commitment to a low-carbon future and pursuant to the Oregon Clean Electricity Plan Renewables • Procured renewables (100 MWa) to meet Oregon Clean Electricity Plan • Wheatridge Renewable Energy Facility: • Split ownership and
Slide 19: Smart grid strategies
Smart grid strategies Building a smarter more resilient grid: • New communication systems • Distributed automation systems • Data analytics • Integrate customers’ energy resources • Utility-scale battery storage • New customer information system 19
Slide 20: Forecasted capital expenditures
Forecasted capital expenditures Outlook • Support for continued customer growth $140 $15 • Upgrades and replacement of aging generation, transmission and distribution equipment • Strengthening the grid for natural disasters, cyber and physical security $580 • Building a smarter, more flexible grid t
Slide 21: PGE investor relations team
PGE investor relations team Chris Liddle Director, Investor Relations and Treasury (503) 464-7458 Christopher.Liddle@pgn.com Peter Davis Analyst, Investor Relations (503) 464-8586 Peter.Davis@pgn.com Portland General Electric Investors.PortlandGeneral.com 121 SW Salmon Street Suite 1WTC0506 Portland
Slide 22: Appendices
Portland General Electric Appendices
Slide 23: Recovery of power costs
Recovery of power costs Annual power cost update tariff • Annual reset of prices based on forecast of net variable power costs (NVPC) for the coming year • Subject to OPUC prudency review and approval, new prices go into effect on or around January 1 of the following year Power Cost Adjustment Mecha
Slide 24: Renewable portfolio standard
Renewable portfolio standard Additional renewable resources • As of 2017, PGE had the following qualifying renewable resources: Type of Resource % of Retail Load Wind 9.4% Low-Impact Hydro 2.5% Solar & Other 0.7% Renewable Portfolio Standard: 2011 2015 2020 2025 2030 2035 2040 5% 15% 20% 27% 35% 45%
Slide 25: Decoupling Mechanism
Decoupling Mechanism The decoupling mechanism is intended to allow recovery of margin lost due to a reduction in sales of electricity resulting from customers’ energy efficiency and conservation efforts. This includes a Sales Normalization Adjustment (SNA) mechanism for residential and small nonresi
Slide 26: Average retail price comparison
Average retail price comparison Residential and Commercial - Winter 2018 Residential Electric Service Prices: Commercial Electric Service Prices: 1,000 kWh monthly consumption. 40 kW demand and 14,000 kWh monthly consumption. (Prices in cents per kWh) (Prices in cents per kWh) EEI U.S. Average 13.8
Slide 27: Average retail price comparison
Average retail price comparison Small and Large Industrial - Winter 2018 Industrial Electric Service Prices Large Industrial Electric Service Prices 1,000 kW peak demand and 400,000 kWh monthly consumption. 50,000 kW peak demand and 32,500,000 kWh monthly consumption. (Prices in cents per kWh) (Pric
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