Portland General Electric Co · NYSE:POR
Portland General Electric — Investor Presentation (October 2022)
34 slides from Portland General Electric's investor presentation, Oct 25, 2022
Slide 1: Investor Presentation
Investor Presentation PORTLAND GENERAL ELECTRIC OCTOBER 25, 2022
Slide 2: Cautionary statement
Cautionary statement Information Current as of October 25, 2022 Except as expressly noted, the information in this presentation is current as of October 25, 2022 — the date on which PGE filed its Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 — and should not be relied upon a
Slide 3: The Company
The Company
Slide 4: PGE at a glance
PGE at a glance 3,300+ MWs of Generation Quick facts Beaver Washington Port Westward 1 & 2 • Vertically integrated electric utility encompassing generation, Tucannon River transmission and distribution OREGON WASHINGTON Wind Farm 26 • Approximately 900,000 retail customers within a service area Colu
Slide 5: Investment thesis
Investment thesis Investing in a reliable and Building a smarter more Focusing on operational clean energy future resilient grid effectiveness and efficiency • Adopting 100% clean energy • Investing in our system to maintain and • 5% to 7% long term EPS growth from framework mandated by ORS 469A.410
Slide 6: Strategy for a Clean Energy Future
Strategy for a Clean Energy Future Strategic Goals Decarbonize Power Electrify the Advance our Reduce greenhouse gas Economy Performance emissions from power Increase beneficial Deliver earnings per served to Oregon retail electricity use to capture share growth of 5% to 7% customers by at least 80%
Slide 7: Diverse, growing service area
Diverse, growing service area • Desirable core urban service area with strong population growth supporting services (government, education, restaurants, healthcare, and other services) OREGON WASHINGTON • I-5 corridor and port access provide opportunity for transportation and 26 Columbia River wareh
Slide 8: Reliability and resiliency investments
Reliability and resiliency investments Capital expenditures forecast $1,150 $415 $775 $800 $750 $725 $750 $100 $100 $100 $130 $100 $210 $530 $555 $580 $475 $505 $410 $130 $130 $120 $120 $120 $120 2022 2023 2024 2025 2026 2027 Generation Transmission and Distribution General Business and Technology C
Slide 9: Update on the 2021 RFP processes
Update on the 2021 RFP processes Project Name Clearwater Wind (1) Continuing 2021 RFP Processes With the execution of the Clearwater Wind Project Location Eastern Montana project, PGE is still seeking approximately: Project Type Wind • 75-200 MW of renewable resources • 375 MW of non-emitting dispat
Slide 10: 2021 RFP shortlist
2021 RFP shortlist Renewable Generation Resources Company-owned Wind Bidder Project Proposal (1) Technology Structure MW (2) MW A (3) 1 a) Solar, Battery PPA 120 — b) Solar PPA 120 — 2 a) Solar, Battery PPA 200 — b) Solar PPA 200 — B 3 a) Solar, Battery PPA 41 — b) Solar PPA 41 — c) Solar, Battery P
Slide 11: 2021 RFP shortlist (continued)
2021 RFP shortlist (continued) Non-emitting Dispatchable Capacity Resources Bidder Project Proposal (1) Technology Structure MW A (2) 8 a) Battery PPA 100 F 9 a) Battery PPA 100 G 10 a) Pumped Storage PPA 196 H 11 a) Battery PPA 150 b) Battery PPA 175 c) Battery PPA 200 12 a) Battery Company-owned 7
Slide 12: Key strengths
Key strengths
Slide 13: Focus on customers
Focus on customers #1 #3 Top quartile No.1 renewable Environmental No. 3 utility in system energy program in Champion the U.S. for reliability(1) the nation for 13 Utility Trusted Brand & customer years(2) Customer Engagement™ experience Edison Electric Institute Residential Study Escalent 2021 Nati
Slide 14: Long-term financial performance
Long-term financial performance Net income, earnings per share, and ROE GAAP Adjusted EPS $2.89(2)(5) $2.75(1) $2.72 (diluted) $2.75(2) $2.74(2)(5) $2.60(2) $2.37 $2.39 GAAP net income (dollars in millions) $92 Long-term Non-GAAP net income 5% to 7%(2) GAAP $1.72(1) (dollars in millions) earnings gr
Slide 15: Proven dividend growth
Proven dividend growth (4) Dividends $1.79 declared per $1.70 common share(3) $1.59 $1.52 $1.43 Actual Payout $1.34 Ratio $1.26 Target Payout $1.18 70% $1.10 $1.12 Ratio 60% (5) 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022E Long-term dividend growth guidance of 5-7%(4) (1) Compound Annual Growt
Slide 16: Liquidity and financing
Liquidity and financing Total Liquidity: $797 million as of September 30, 2022 (dollars in millions) Ratings S&P Moody’s Cash Senior Secured A A1 $18 Senior Unsecured BBB+ A3 Letters of Commercial Paper A-2 P-2 Credit $129 Outlook Stable Stable Expected 2022 Credit financings Q1 Q2 Q3 Q4 Facilities
Slide 17: Environmental, Social and Governance
Environmental, Social and Governance
Slide 18: Decarbonizing our energy supply
Decarbonizing our energy supply We plan to achieve companywide net zero greenhouse gas emissions by 2040 Reducing emissions associated with the power serving customers • Our near-term power supply emissions target is to reduce greenhouse gas emissions associated with the power supplied to Oregon ret
Slide 19: PGE's 2030 clean energy target
PGE’s 2030 clean energy target What we’re already doing 6.26 Boardman closure (-518 MW) MMTCO2e (2021 emissions) 2021 RFP (+375-500 MW) Green Future Impact (+750 MW) Douglas PPA (+160 MW) Hydro renewals (+224 MW) What we’re planning Energy efficiency (+220 MW) 8.1 MMTCO2e Clean energy
Slide 20: Sustainability and ESG governance framework
Sustainability and ESG governance framework Responsibility for environmental, social and governance (ESG) performance is integrated with the policies and principles that govern our company Board oversight The Board area of strategic responsibility includes oversight over actions to address risks and
Slide 21: Diverse and experienced Board
Diverse and experienced Board Director Committee Other Public Name Age Since Industry/Experience Diversity Membership(1) Boards Track record of thoughtful refreshment Rodney Brown • Compensation 66 2007 Law/Environmental/Regulatory White/Male 0 enables us to have a Board with the Independent • Finan
Slide 22: Diversity, equity, and inclusion
Diversity, equity, and inclusion Committed to DEI across our business • Partners and suppliers: Increasing our supplier diversity to 15% of total supplier spending by the end of 2022 Workforce by Gender(1) • Awareness, education, and training: Racial equity 0.2% education for our board, leadership a
Slide 23: Sustainability reporting
Sustainability reporting • Our 2021 ESG Report shares information about PGE’s commitment to sustainability along with strategic projects that illustrate our commitment to advancing a sustainable future and caring for our community • Sustainability principles are woven into the fabric of who we are a
Slide 24: Appendices
Portland General Electric APPENDICES
Slide 25: Operating expense trends
Operating expense trends • Non-deferrable vegetation management and wildfire mitigation expenditures have been a significant driver in O&M growth • Vegetation management efforts include year-round routine inspection and maintenance as well as the Advanced Wildfire Risk Reduction (AWRR) program • Wil
Slide 26: 2022 General Rate Case conclusion
2022 General Rate Case conclusion Rate Case Key Terms – Final Order 22-129 – Rates Effective May 9, 2022 Average Rate Base $5.6 Billion Average Rate Base Increase $814 million, 17% ROE 9.5% Capital Structure 50/50 Cost of Debt 4.125% Cost of Capital 6.83% Revenue Requirement Increase $74 million, in
Slide 27: 2022 GRC order deferral earnings test
2022 GRC order deferral earnings test • OPUC Order 22-129 created earnings tests for certain major deferrals, including the Boardman revenue requirement at a regulated Return on Equity (ROE) threshold of 9.5% and the 2020 labor day wildfire and the 2021 ice storm deferrals using a 9.3% regulated ROE
Slide 28: Major deferral update
Major deferral update On October 24, 2022, PGE and parties submitted stipulations to the OPUC reflecting an agreement that resolved all matters related to 2021 of the 2022 Labor Day Wildfire, February 2021 Ice Storm and most of the 2021 Power Cost Adjustment Mechanism Balance as of Stipulated Stipul
Slide 29: Wildfire mitigation and risk management
Wildfire mitigation and risk management PGE prioritizes protecting the lives and property of customers, coworkers and the communities we serve • Approved Wildfire Mitigation Plan (Docket UM 2208) • Robust tree trimming and vegetation management program • Ongoing focus on system hardening: • Fire res
Slide 30: Constructive regulatory / policy environment
Constructive regulatory / policy environment Oregon Federal • ORS 469A.410/HB 2021 legislation mandates 100% clean energy • The Inflation Reduction Act (IRA), which was signed into law in by 2040 August 2022, is expected to further enhance PGE’s already strong • Oregon Public Utility Commission pros
Slide 31: 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 32: Average retail price comparison
Average retail price comparison 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) PGE - Sch. 7 13.7 PGE - Sch. 83 10.9 EEI U.S. Average 14.8 EEI U.
Slide 33: Non-GAAP financial measures
Non-GAAP financial measures This press release contains certain non-GAAP measures, such as adjusted earnings, adjusted EPS and adjusted earnings guidance. These non-GAAP financial measures exclude significant items that are generally not related to our ongoing business activities, are infrequent in
Slide 34: Non-GAAP financial measures
Non-GAAP financial measures Non-GAAP Earnings Reconciliation for the quarter ended March 31, 2022 (Dollars in millions, except EPS) Net Income Diluted EPS GAAP as reported for the quarter ended March 31, 2022 $60 $0.67 Exclusion of released deferrals related to 2020 17 0.19 Tax effect (1) (5) (0.05)
Portland General Electric — Investor Presentation (October 2022) on 6ix