Slide 1: EEI Financial Conference Palm Desert, CA
EEI Financial Conference Palm Desert, CA October 31 - November 3, 2010 Exhibit 99.2
Slide 2: Cautionary Statements and Factors That May Affect Future Results
Cautionary Statements and Factors That May Affect Future Results Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Actual results may
Slide 3: Recent Developments
Recent Developments § Close of LG&E, KU Transaction § Pending sale of non-core assets § Favorable ALJ recommendation in PA rate case
Slide 4: The New PPL
The New PPL *Based on closing stock price on 10/26/2010 § Significantly larger regulated business – Expected to be 55-60 percent of total EBITDA next year – Very positive regulatory relationships – LG&E, KU add regulated generation, improving diversity § Substantial Capex spending in regulated busin
Slide 5: PPL: Making the Right Calls in Challenging Markets
PPL: Making the Right Calls in Challenging Markets Scrubbers at Montour Holtwood Hydro Expansion Project § Sale of Latin American operations § Early mover on scrubbers - significant savings § Successful competitive market transition in Pennsylvania § Hedging strategy captured $2.5 billion in value §
Slide 6: Pennsylvania Rate Request
Pennsylvania Rate Request § $77.5 million settlement approved by ALJ’s Recommended Decision § Rate design recommendation accepts PPL Electric’s proposals § Lower generation prices should offset increase § Final PUC decision expected in mid-December § New rates effective January 1, 2011
Slide 7: Environmental Control Equipment Positions PPL Favorably for Future Regulation
Environmental Control Equipment Positions PPL Favorably for Future Regulation PPL has complied with current environmental regulations on a proactive basis (1) Colstrip is located in Montana (2) Keystone & Conemaugh: PPL is a minority owner and does not operate (3) Brunner Island’s cooling towers are
Slide 8: Company Well-positioned on Developing Environmental Issues
Company Well-positioned on Developing Environmental Issues § Carbon legislation could be net benefit – Competitive fleet with a good mix of fuel – Very good prospects for recovery of cost to comply in regulated facilities § Working toward reasonable rulemaking for fossil fleet regulations
Slide 9: Dividend Profile
Dividend Profile $/Share Annualized
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Slide 11: Strong Expected Earnings Growth
(1) Strong Expected Earnings Growth Forecast (1) $2.02 Per Share $1.95 $2.95 Note: See Appendix for the reconciliation of earnings from ongoing operations to reported earnings. (1) Adjusted for share dilution, but excludes KY utility operations operating results for November and December $2.80
Slide 12: Market Prices
(1) Market prices based on the average of broker quotes as of 9/30/2010 (2) 24-hour average (3) NYMEX and TZ6NNY forward gas prices on 9/30/2010 (4) Market Heat Rate = PJM on-peak power price divided by TZ6NNY gas price Market Prices Market Prices ELECTRIC PJM On-Peak Off-Peak ATC(2) Mid-Columbia On
Slide 13: Supply Segment Asset Hedge Positions
2010 2011 2012 Baseload Expected Generation* (Million MWhs) 50.3 51.4 54.7 East 41.7 43.1 46.2 West 8.6 8.3 8.5 Current Hedges (%) 100% 97% 68% East 100% 98% 63% West 100% 94% 94% Average Hedged Price (Energy Only) ($/MWh) $59 $56 $58 East $60 $56 $59 West $50 $54 $54 Expected Average Price (Fully L
Slide 14: Current Fuel Contracts - Base Prices
2010 2011 2012 Hedge Level Price Hedge Level Price Hedge Level Price % Fixed Base Price 93% $49 96% $52 32% $64 % Collars 0% N/A 0% N/A 68% $45-$52 % Diesel Surcharge 7% $45 4% $45 0% N/A 2010 2011 2012 Uranium 100% 100% 100% Coal East 100% 98% 95% West 100% 100% 100% Total 100% 99% 96% Current Fuel
Slide 15: Increased Scale with Continued Growth
Increased Scale with Continued Growth Note: Represents capitalization for E.ON US since LG&E and KU rate constructs are based on capitalization. (1) Figures based on assumed exchange rate of $1.60 / GBP. ($ in billions) 2011E - 2014E CAGR: 7.5%
Slide 16: Liquidity Profile
Liquidity Profile quidity Profile Total Letters of Credit Expiration Faci lity Outstanding Drawn Availability Institution Facility Date (Millions) (Millions) (Millions) (Millions) PPL Energy Supply 5-year Credit Facility Jun-2012 $3,225 $5 $0 $3,220 3-Year Bilateral Credit Facility Mar-2013 200 85 0
Slide 17: Capital Expenditures by Segment
Capital Expenditures by Segment Millions $1,675 $1,826 $1,796
Slide 18: Reconciliation of PPL's Earnings from Ongoing Operations to Reported Earnings
Reconciliation of PPL’s Earnings from Ongoing Operations to Reported Earnings Reconciliation of PPL’s Earnings from Ongoing Operations to Reported Earnings Forecast [a] Actual High Low 2010 2010 2009 2008 Earnings from Ongoing Operations per share of common stock 2.95 $ $ 2.80 1.95 $ $ 2.02 Special
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Slide 20: Post-Acquisition Structure
Corp. PPL Corporation PPL Energy Funding Corp. PPL Energy Supply, LLC PPL Global, LLC PPL Energy Plus, LLC PPL Generation, LLC WPD Entities Louisville Gas & Electric Company Kentucky Utilities Company PPL Capital Funding, Inc. Post-Acquisition Structure Kentucky Holdings, LLC LLC PPL Electric Utilit
Slide 21: Sources of Acquisition Financing
Net Common Stock Proceeds $ 2,409 Net Proceeds from Equity Unit Securities 1,116 Net Poll ution Control Revenue Bonds (Assumed) 762 E.ON U.S. Capital MTN’s (Assumed) 2 Cash on hand 101 Draws under PPL Energy Supply credit facility and loans to Kentucky holding company and utility subsidiaries to pay
Slide 22: Permanent Financing
Permanent Financing § Subsequent to the closing, the Credit Facility draws and loans will be repaid through the issuance by the Kentucky companies of a combination of unsecured debt, First Mortgage Bonds and remarketed Pollution Control Revenue Bonds. § To mitigate interest rate risk, PPL has hedged
Slide 23: Projected Capitalization Structures at 12/31/2010
Projected Capitalization Structures at 12/31/2010 (1) Projected Capitalization Structures at 12/31/2010 (1) (Millions of $) Total PPL Corpora tion Debt $ 11,957 Equity Unit Securities 1,150 Preference Stock 250 Common Equity 8,213 Total $ 21,570 Kentucky Holdings Consolidated Debt $ 3,888 Common Equ
Slide 24: Liquidity Position
Liquidity Position § PPL has drawn on PPL Energy Supply’s new $4 billion credit facility – PPL borrowed $3.2 billion under this facility for the acquisition closing in order to make loans to KU, LGE and the Kentucky holding company on the closing date so that those companies could repay loans due to
Slide 25: Overview of the Acquired Utilities
Overview of the Acquired Utilities Overview of the Acquired Utilities . E.ON U.S. is the only IOU (1) to rank in the top quartile in all five of the key operating benchmark categories E.ON U.S. 2008 Rank out of IOU Utility Area Metric Performance Holding companies Generation Transmission Distributio
Slide 26: 2010 Kentucky Rate Case
2010 Kentucky Rate Case Per January 2010 Request Per June 2010 Stipulation LG&E annual base electric rate increase $95 million $74 million LG&E annual gas rate increase $23 million $17 million KU annual base electric rate increase $135 million $98 million ROE 11.50% 10.25 - 10.75% Recovery of wind a
Slide 27: Kentucky Change of Control Settlement
Kentucky Change of Control Settlement • Resolved issues with all parties to the Kentucky Change of Control case • Key Provisions − LG&E and KU agreed not to seek base rate adjustment that would become effective prior to January 1, 2013 − Normal fuel cost adjustments and environmental cost recovery m
Slide 28: Environmental Cost Recovery Mechanism
Environmental Cost Recovery Mechanism Ÿ ECR allows real time return of and on environmental investment (including CWIP) and recovery of environmental expenses associated with coal-fired generation Ÿ Most recent ECR plan approved by KPSC December 2009 ‒ Selective catalytic reduction unit (SCR) at Bro
Slide 29: Forward-Looking Information Statement
Forward-Looking Information Statement Statements contained in this press release, including statements with respect to future events and their timing, including statements concerning the acquisition by PPL Corporation of E.ON U.S. LLC and its subsidiaries Louisville Gas & Electric Company and Kentuc
Slide 30: Definitions of Non-GAAP Financial Measures
Definitions of Non-GAAP Financial Measures “Earnings from ongoing operations” is adjusted for the impact of special items. Special items include: • Energy-related economic activity (as discussed below). • Foreign currency-related economic hedges. • Gains and losses on sales of assets not in the ordi
Slide 31: Definitions of Non-GAAP Financial Measures (continued)
Definitions of Non-GAAP Financial Measures (continued) "Domestic Gross Energy Margins" and "Domestic Gross Delivery Margins" are not intended to replace "Operating Income," which is determined in accordance with GAAP, as an indicator of overall operating performance. • "Domestic Gross Energy Margins