Attached files
| file | filename |
|---|---|
| EX-99.1 - PRESS RELEASE - PORTLAND GENERAL ELECTRIC CO /OR/ | ex99120160930pressrelease.htm |
| 8-K - FORM 8-K - PORTLAND GENERAL ELECTRIC CO /OR/ | porform8-kfor20160930press.htm |
Exhibit 99.2
Earnings Conference Call
Third Quarter 2016
Cautionary Statement
Information Current as of October 28, 2016
Except as expressly noted, the information in this presentation is current as of October 28, 2016 — the date on which PGE filed
its Quarterly Report on Form 10-Q for the quarter ended September 30, 2016 — and should not be relied upon as being current
as of any subsequent date. PGE undertakes no duty to update the presentation, except as may be required by law.
Forward-Looking Statements
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 the expected capital costs for the
Carty Generating Station and the recovery of those costs; 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; and general economic and financial market conditions. 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 assumes no obligation to update any such forward-looking
statement. Prospective investors should also review the risks and uncertainties listed in the company’s most recent annual report
on form 10-K and the company’s reports on forms 8-K and 10-Q filed 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.
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Leadership Presenting
Jim Lobdell
Senior VP
of Finance,
CFO & Treasurer
Jim Piro
President & CEO
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On Today’s Call
▪ Financial performance
▪ Operational update
▪ Economy and customers
▪ Carty update
▪ 2016 Integrated Resource Plan
▪ Capital expenditure forecast
▪ Financial update
▪ Earnings guidance
NI in millions Q3 2015 Q3 2016
Net Income $36 $34
Diluted EPS $0.40 $0.38
2015 EPS
$2.04
2016E EPS
$2.05 - $2.20
Q2
Q3
Third Quarter 2016 Earnings Results
4
Q4E
$0.57
-
$0.72
Q1
Q2 Q3
Q4
Q1
Accomplishments and Operational Update
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Economic Update
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(1) Oregon Office of Economic Analysis
(2) State of Oregon Employment Department
(3) Oregon Office of Economic Analysis
(4) Net of approximately 1.5% of energy efficiency, excluding one large paper customer and adjusting for Leap Year
▪ 50 consecutive months of job growth
in Oregon, longest streak on record(1)
▪ PGE's service area unemployment
rate of 4.9 percent in September beat
Oregon's rate of 5.5 percent and the
national rate of 5.0 percent(2)
▪ Oregon wage gains are third-fastest
in nation(3)
▪ Average residential customer count
increased approximately 1.3 percent
over the past year
New Generation: Baseload Resource
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Carty Generating Station, our 440 MW natural gas baseload plant near Boardman, OR
Capital costs, including AFDC, approved in 2016 GRC: $514M
Total estimated cost, including AFDC, for completion(1): $640-$660M(1)
Carty plant in service as of 9/30/2016: $615M
Estimated time frame to complete all litigation: 2-4 years
(1) Total estimated cost does not consider any amounts received from sureties under the performance bond
Exceptional availability at Carty Generating Station
2016 Integrated Resource Plan
▪ Energy efficiency and demand side actions
▪ Investment/acquisition of renewables to meet Oregon
Clean Electricity Plan: IRP will position PGE to comply with
27% requirement by 2025
▪ Filling up to 850 MW capacity deficit to ensure reliability
▪ 375-550 MW long-term annual dispatchable
resources
▪ Up to 400 MW annual or seasonal capacity resources
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IRP Timeline proposed to OPUC
Areas of Focus
Continuing PGE's shift to more renewables, less carbon
Next steps, post acknowledgment
Estimated Capital Expenditures
9
(1) Consists of board-approved ongoing CapEx and hydro relicensing per the Third Quarter Form 10-Q filed on October 28, 2016
Note: Amounts exclude AFDC debt and equity
(2) Total estimated cost does not consider any amounts that may be received from sureties under the performance bond
Current Capital Outlook
▪ The board of directors
approved additional
spending to improve the
efficiency and resiliency of
PGE's infrastructure.
▪ Capital additions that
could result from the
Request For Proposal(s)
following acknowledgment
of the Integrated Resource
Plan have not been
estimated and are not
shown.
$594-$614
Base Capital Spending(1) Carty(2)
$187
-
$207
Third Quarter 2016 Income Statement Bridge
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9/30/2015 9/30/2016
Price Increase $ 15
Decoupling $ 9
Volume Decrease $ (34 )
Other $ (1 )
Retail
Revenue
Wholesale
Revenue
Power
Costs
O&M D&A Income
Taxes
Gross Margin Variance: $9
Other
Taxes
$ in millions
Carty Earnings $ 0.02
Carty Overage $ (0.01 )
Carty Legal $ (0.02 )
9/30/2015 9/30/2016
Carty Load
Changes
Non-
Qualified
Benefit Trust
Other
Third Quarter 2016 Drivers Bridge
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Liquidity and Financing
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2016 Financing Activity
Q1 2016 Q2 2016 Q3 2016 Q4 2016
First Mortgage Bonds
$140 million
issued
$133 million
redeemed
Unsecured Loan Agreement $125 million borrowed
$25 million
planned
Senior
Secured
Senior
Unsecured Outlook
S&P A- BBB Stable
Moody’s A1 A3 Stable
Total Liquidity as of 9/30/2016 (in millions)
Credit Facilities $ 660
Commercial Paper $ —
Letters of Credit $ (73 )
Cash $ 88
Available $ 675
▪ Flat retail load growth for the full year, weather adjusted and
excluding one large paper company;
▪ Average hydro conditions for the remainder of the year;
▪ Wind generation for the remainder of the year based on 5 years of
historic levels or forecast studies when historical data is not
available;
▪ Normal thermal plant operations;
▪ Operating and maintenance costs between $515 and $535 million;
and
▪ Depreciation and amortization expense between $315 and $325
million.
Guidance
13
2016 EPS Guidance: $2.05-$2.20
2016 Key Initiatives
1. Pursue legal actions against the sureties and Abeinsa
2. Complete and file the 2016 Integrated Resource Plan
3. Maintain high level of operational excellence
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