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What changed in PORTLAND GENERAL ELECTRIC CO /OR/'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of PORTLAND GENERAL ELECTRIC CO /OR/'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+452 added−477 removedSource: 10-K (2024-02-20) vs 10-K (2023-02-16)

Top changes in PORTLAND GENERAL ELECTRIC CO /OR/'s 2023 10-K

452 paragraphs added · 477 removed · 328 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

113 edited+31 added−22 removed58 unchanged
Biggest changePGE’s Retail revenues, retail energy deliveries, and average number of retail customers consist of the following: Years Ended December 31, 2022 2021 2020 Retail revenues (1) (dollars in millions): Residential $ 1,158 52 % $ 1,118 54 % $ 1,030 53 % Commercial 735 33 708 34 634 33 Industrial 312 14 279 13 246 13 Subtotal 2,205 99 2,105 101 1,910 99 Alternative revenue programs, net of amortization 11 1 (29) (1) (6) — Other accrued revenues, net (2) 7 — 2 — 28 1 Total retail revenues $ 2,223 100 % $ 2,078 100 % $ 1,932 100 % Retail energy deliveries (3) (MWh in thousands): Residential 8,088 38 % 7,978 39 % 7,756 40 % Commercial 7,198 34 7,193 35 6,855 35 Industrial 5,945 28 5,361 26 4,932 25 Total retail energy deliveries 21,231 100 % 20,532 100 % 19,543 100 % Average number of retail customers: Residential 809,573 88 % 800,372 88 % 791,119 88 % Commercial 112,602 12 111,569 12 110,851 12 Industrial 269 — 268 — 267 — Total 922,444 100 % 912,209 100 % 902,237 100 % (1) Includes both revenues from customers who purchase their energy supplies from the Company and revenues from the delivery of energy to those commercial and industrial customers that purchase their energy from ESSs. 8 Table of Contents (2) Amount for the year ended December 31, 2020 is primarily comprised of $24 million of amortization, including interest, related to the deferral recorded in 2018 for the net tax benefits due to the change in corporate tax rate under the United States Tax Cuts and Jobs Act of 2017 (TCJA).
Biggest changeRetail Revenues Retail customers are classified as residential, commercial, or industrial, with no single customer representing more than 9% of PGE’s total retail revenues or 14% of total retail deliveries during 2023. 9 Table of Contents PGE’s Retail revenues, retail energy deliveries, and average number of retail customers consist of the following: Years Ended December 31, 2023 2022 2021 Retail revenues (1) (dollars in millions): Residential $ 1,263 52 % $ 1,158 52 % $ 1,118 54 % Commercial 808 33 735 33 708 34 Industrial 368 15 312 14 279 13 Subtotal 2,439 100 2,205 99 2,105 101 Alternative revenue programs, net of amortization 11 — 11 1 (29) (1) Other accrued (deferred) revenues, net (3) — 7 — 2 — Total retail revenues $ 2,447 100 % $ 2,223 100 % $ 2,078 100 % Retail energy deliveries (2) (MWh in thousands): Residential 7,952 37 % 8,088 38 % 7,978 39 % Commercial 7,178 34 7,198 34 7,193 35 Industrial 6,293 29 5,945 28 5,361 26 Total retail energy deliveries 21,423 100 % 21,231 100 % 20,532 100 % Average number of retail customers: Residential 815,920 88 % 809,573 88 % 800,372 88 % Commercial 112,667 12 112,602 12 111,569 12 Industrial 273 — 269 — 268 — Total 928,860 100 % 922,444 100 % 912,209 100 % (1) Includes both revenues from customers who purchase their energy supplies from the Company and revenues from the delivery of energy to those commercial and industrial customers that purchase their energy from ESSs.
Although the Company includes such Direct Access customers in its customer counts and energy delivered to such commercial and industrial customers in its total retail energy deliveries, retail revenues include only delivery charges and applicable transition adjustments for these Direct Access customers, as the customers purchase energy directly from the ESSs.
Although the Company includes such customers in its customer counts, and energy delivered to such commercial and industrial customers in its total retail energy deliveries, retail revenues include only delivery charges and applicable transition adjustments for these Direct Access customers, as the customers purchase energy directly from the ESSs.
Although PGE does not operate Wheatridge, it owns 40 turbines with a total nameplate capacity of 100 MW and purchases the output of the remaining turbines, with a nameplate capacity of 200 MW through power purchase agreement.
Although PGE does not operate Wheatridge, it owns 40 turbines with a total nameplate capacity of 100 MW and purchases the output of the remaining turbines, with a nameplate capacity of 200 MW through a power purchase agreement.
Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA), and the Nuclear Regulatory Commission (NRC), have regulatory authority over certain of PGE’s operations and activities, as described in the discussion that follows.
Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA), and the Nuclear Regulatory Commission (NRC), have regulatory authority over certain aspects of PGE’s operations and activities, as described in the discussion that follows.
Energy efficiency measures also impact commercial demand, as measures have focused in the commercial sector in recent years, although the Company’s decoupling mechanism was intended to partially mitigate the financial effects of such measures.
Energy efficiency measures also impact commercial demand, as measures have focused on the commercial sector in recent years, although the Company’s decoupling mechanism was intended to partially mitigate the financial effects of such measures.
For more information regarding the Clearwater Wind development, see “ The Resource Planning Process ” within the “ Overview” section of Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Hydro The Company’s FERC-licensed hydroelectric projects consist of Pelton/Round Butte on the Deschutes River near Madras, Oregon (discussed below), four plants on the Clackamas River, and one on the Willamette River.
For more information regarding Clearwater, see “ The Resource Planning Process ” within the “ Overview” section of Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Hydro The Company’s FERC-licensed hydroelectric projects consist of Pelton/Round Butte on the Deschutes River near Madras, Oregon (discussed below), four plants on the Clackamas River, and one on the Willamette River.
(3) Includes both energy sold to retail customers and energy deliveries to those commercial and industrial customers that purchase their energy from ESSs. The following table presents additional annual averages for retail customers. Certain supplemental tariff collections are excluded from revenues as they are not considered a part of the Company’s base retail prices for these calculations.
(2) Includes both energy sold to retail customers and energy deliveries to those commercial and industrial customers that purchase their energy from ESSs. The following table presents additional annual averages for retail customers. Certain supplemental tariff collections are excluded from revenues as they are not considered a part of the Company’s base retail prices for these calculations.
For information regarding actual generating output and purchases for the years ended December 31, 2022 and 2021, see the Results of Operations section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Generation PGE’s generating resources consist of six thermal plants (natural gas- and coal-fired), three wind farms, and seven hydroelectric facilities.
For information regarding actual generating output and purchases for the years ended December 31, 2023 and 2022, see the Results of Operations section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Generation PGE’s generating resources consist of six thermal plants (natural gas- and coal-fired), three wind farms, and seven hydroelectric facilities.
The OPUC has also authorized a Power Cost Adjustment Mechanism (PCAM), under which PGE may share with customers a portion of actual cost variances associated with NVPC. • Renewable Energy. The State has a Renewable Portfolio Standard (RPS) that requires PGE to serve a portion of its retail load with renewable resources.
The OPUC has also authorized a Power Cost Adjustment Mechanism (PCAM), under which PGE may share with customers a portion of actual cost variances associated with NVPC. • Renewable Adjustment Clause mechanism. The State has a Renewable Portfolio Standard (RPS) that requires PGE to serve a portion of its retail load with renewable resources.
ITEM 1. BUSINESS. General Portland General Electric Company (PGE or the Company), a vertically-integrated electric utility with corporate headquarters located in Portland, Oregon, is engaged in the generation, wholesale purchase, transmission, distribution, and retail sale of electricity in the state of Oregon (State).
ITEM 1. BUSINESS. General Portland General Electric Company (PGE or the Company), a vertically-integrated electric utility with corporate headquarters located in Portland, Oregon, is engaged in the generation, wholesale purchase and sale, transmission, distribution, and retail sale of electricity to customers in the state of Oregon (State).
House Bill (HB) 2021 —In June 2021, the Oregon Legislature passed HB 2021, which requires retail electricity providers to reduce GHG emissions associated with serving Oregon retail electricity consumers 80% by 2030, 90% by 2035, and 100% by 2040, compared to their baseline emissions levels.
HB 2021 —In June 2021, the Oregon Legislature passed HB 2021, which requires retail electricity providers to reduce GHG emissions associated with serving Oregon retail electricity consumers 80% by 2030, 90% by 2035, and 100% by 2040, compared to their baseline emissions levels.
CTWS has a second option in 13 Table of Contents 2036 to purchase an undivided 0.02% interest in Pelton/Round Butte. If the second option is exercised, CTWS’s ownership percentage would exceed 50%. PGE purchases 100% of the CTWS’s share of the project output. For more information see “CTWS” within Purchased Power in the Power Supply section of this Item 1.
The CTWS has a second option in 2036 to purchase an undivided 0.02% interest in Pelton/Round Butte. If the second option is exercised, the CTWS’s ownership percentage would exceed 50%. PGE purchases 100% of the CTWS’s share of the project output. For more information see “CTWS” within Purchased Power in the Power Supply section of this Item 1.
As of December 31, 2021, PGE had a 66.67% ownership interest in the 455 MW Pelton/Round Butte hydroelectric project on the Deschutes River, with the remaining interest held by the Confederated Tribes of the Warm Springs Reservation of Oregon (CTWS). A 50-year joint license for the project, which is operated by PGE, was issued by the FERC in 2005.
As of December 31, 2021, PGE had a 66.67% ownership interest in the 455 MW Pelton/Round Butte hydroelectric project, with the remaining interest held by the Confederated Tribes of the Warm Springs Reservation of Oregon (CTWS). A 50-year joint license for the project, which is operated by PGE, was issued by the FERC in 2005.
The PGE Board of Directors oversees executive talent development with the assistance of the Nominating, Governance, and Sustainability Committee and the Compensation, Culture and Talent Committee in an effort to maximize the pool of internal candidates.
The PGE Board of Directors oversees executive talent development with the assistance of the Nominating, Governance, and Sustainability Committee and the Compensation, Culture and Talent Committee in an effort to increase the pool of internal candidates.
PGE is subject to such authority as the Company has a 79.5% ownership interest in the Kelso-Beaver (KB) Pipeline, a 17-mile, 20-inch diameter, interstate pipeline that provides natural gas to Port Westward Unit 1 (PW1), Port Westward Unit 2 (PW2), and Beaver, the Company’s natural gas-fired generating plants located near Clatskanie, Oregon, to the North Mist storage facility (owned and operated by a local natural gas distribution company), and to one additional local delivery point that serves a manufacturing concern.
PGE is subject to such authority as the Company has a 79.5% ownership interest in the Kelso-Beaver (KB) Pipeline, a 17-mile, 20-inch diameter, interstate pipeline that provides natural gas to the Company’s three natural gas-fired generating plants located near Clatskanie, Oregon: i) Port Westward Unit 1 (PW1); ii) Port Westward Unit 2 (PW2), and iii) Beaver; the North Mist storage facility, which is owned and operated by a local natural gas distribution company; and one additional delivery point that serves a local manufacturing concern.
PGE relies on transmission contracts with Bonneville Power Administration (BPA) to transmit a significant amount of the Company’s generation to serve its distribution system. PGE’s transmission system, together with contractual rights on other transmission systems, enables the Company to integrate and access generation resources to meet its customers’ energy requirements.
PGE relies on transmission contracts with BPA to transmit a significant amount of the Company’s generation to serve its distribution system. PGE’s transmission system, together with contractual rights on other transmission systems, enables the Company to integrate and access generation resources to meet its customers’ energy requirements.
Behavior patterns, conservation, energy efficiency initiatives and measures, weather effects, economic conditions, distributed generation including rooftop solar, transportation and building electrification, and demographic changes all play a 11 Table of Contents role in determining expected future customer demand and the resulting resources the Company may need to adequately meet those loads and maintain adequate capacity reserves.
Behavior patterns, conservation, energy efficiency initiatives and measures, weather effects, economic conditions, distributed generation including rooftop solar, transportation and building electrification, and demographic changes all play a role in determining expected future customer demand and the resulting resources the Company may need to adequately meet those loads and maintain adequate capacity reserves.
In addition, the Company prepares, pursuant to applicable provisions of the FPA, financial statements in accordance with the accounting requirements of the FERC, as set forth in its applicable Uniform System of Accounts and published accounting releases. Such financial statements are included in annual and quarterly reports filed with the FERC.
In addition, the Company prepares, pursuant to applicable provisions of the FPA, financial statements in accordance with the accounting requirements of the FERC, as set forth in its applicable Uniform System of Accounts and 7 Table of Contents published accounting releases. Such financial statements are included in annual and quarterly reports filed with the FERC.
For more information regarding the Clearwater Wind development, see “ The Resource Planning Process ” within the “ Overview” section of Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Solar —PGE has four contracts representing 57 MW of capacity to purchase power generated from photovoltaic solar projects.
For more information regarding the Clearwater Wind development, see “ The Resource Planning Process ” within the “ Overview” section of Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Solar —PGE has five contracts representing 219 MW of capacity to purchase power generated from photovoltaic solar projects.
For further information regarding Direct Access deliveries, see “Customers and demand” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” PGE’s customers have a desire for purchasing clean energy, as over 234 thousand residential and small commercial customers voluntarily participate in PGE’s Green Future Program, the largest renewable power program by participation in the nation.
For further information regarding Direct Access deliveries, see “Customers and demand” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” 11 Table of Contents PGE’s customers have a desire for purchasing clean energy, as over 233 thousand residential and small commercial customers voluntarily participate in PGE’s Green Future Program, the largest renewable power program by participation in the nation.
This customer class includes most businesses, small industrial companies, and public street and highway lighting accounts. The Company’s commercial customer demand is somewhat less susceptible to weather conditions than residential customer demand. Economic conditions and fluctuations in total employment in the region can lead to changes in energy demand from commercial customers.
This customer class includes most businesses, small industrial companies, and public street and highway lighting accounts. The Company’s commercial customer demand is somewhat less susceptible to weather conditions than residential customer demand. Economic conditions and fluctuations in total employment in the region can be indicative of changes in energy demand from commercial customers.
In addition, the Company distributes power to customers that choose to purchase their energy from an Electricity Service Supplier (ESS).
In addition, the Company distributes power to Direct Access customers that choose to purchase their energy from an Electricity Service Supplier (ESS).
PGE has implemented such a plan for its transmission, distribution, and thermal generation facilities and additional, specific plans for its wind generation facilities. Hazardous Material PGE has a comprehensive program to comply with requirements of both federal and state regulations related to the storage, handling, and disposal of hazardous materials.
PGE has implemented such a plan for its transmission, distribution, and thermal generation facilities and additional, specific plans for its wind generation facilities. 21 Table of Contents Hazardous Materials PGE has a comprehensive program to comply with requirements of both federal and state regulations related to the storage, handling, and disposal of hazardous materials.
In Oregon, Montana, and Washington, the Department of Environmental Quality and Department of Ecology of each state are responsible for reviewing proposed projects under such requirements to ensure that federally approved activities will meet water quality standards and policies established by the respective state.
In Oregon, Montana, and Washington, the environmental regulatory agencies of each state are responsible for reviewing proposed projects under such requirements to ensure that federally approved activities will meet water quality standards and policies established by the respective state.
PGE manages its air emissions at its thermal generating plants by the use of low sulfur fuel, emissions and combustion controls and monitoring, and sulfur dioxide allowances awarded under the CAA.
PGE manages its air emissions at its thermal generating plants by the use of low sulfur fuel, emissions and combustion controls and monitoring, and sulfur dioxide allowances awarded pursuant to the CAA.
Interconnected transmission systems in the western United States serve utilities with diverse load requirements and allow the Company to purchase and sell electricity, largely through bi-lateral agreements, 10 Table of Contents within the region to serve retail demand.
Interconnected transmission systems in the western United States serve utilities with diverse load requirements and allow the Company to purchase and sell electricity, largely through bi-lateral agreements, within the region to serve retail demand.
For further information on SB 1547, see “ RPS standards and other laws” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” ◦ During 2021, the State legislature passed House Bill (HB) 2021, which establishes clean energy targets and sets out a framework that includes, among other things, the development and submittal of clean energy plans for investor-owned utilities, including PGE, and electric service suppliers in the State.
For further information on SB 1547, see “ RPS standards and other laws” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” 8 Table of Contents ◦ During 2021, the State legislature passed Oregon House Bill (HB) 2021, which established clean energy targets and set out a framework that includes, among other things, the development and submittal of clean energy plans for investor-owned utilities, including PGE, and electric service suppliers in the State.
Fuel Supply —PGE contracts for natural gas and coal supplies required to fuel the Company’s thermal generating plants, with certain plants also able to operate on fuel oil, if needed. In addition, the Company uses forward, future, swap, and option contracts to manage its exposure to volatility in natural gas prices.
Fuel Supply —PGE contracts for natural gas and coal supplies required to fuel the Company’s thermal generating plants, with certain plants also able to operate on fuel oil, if needed. In addition, the Company utilizes financial instruments such as forward, future, swap, and option contracts to manage its exposure to volatility in natural gas prices.
PGE schedules energy deliveries over its transmission system in accordance with FERC requirements and operates one BAA in its service territory. In 2022, PGE delivered approximately 27 million megawatt hours (MWh) through 1,255 circuit miles of transmission lines operating at or above 115 kilovolts (kV).
PGE schedules energy deliveries over its transmission system in accordance with FERC requirements and operates one BAA in its service territory. In 2023, PGE delivered approximately 28 million megawatt hours (MWh) through 1,254 circuit miles of transmission lines operating at or above 115 kilovolts (kV).
The Company participates in the wholesale market through the purchase and sale of electricity and natural gas in an effort to obtain reasonably-priced power to serve its retail customers. PGE is committed to developing products and service offerings for the benefit of retail and wholesale customers.
The Company participates in the wholesale market through the purchase and sale of electricity and natural gas in an effort to obtain reasonably-priced power to serve its retail customers, manage risk, and administer its long-term wholesale contracts. PGE is committed to developing products and service offerings for the benefit of retail and wholesale customers.
Air Quality Clean Air Act —PGE’s operations, primarily its thermal generating plants, are subject to regulation under the federal Clean Air Act (CAA), which addresses particulate matter, hazardous air pollutants, and GHG emissions, among other things.
Air Quality Clean Air Act —PGE’s operations, primarily its thermal generating plants, are subject to regulation under the federal Clean Air Act (CAA), which addresses particulate matter, hazardous air pollutants, and GHG emissions in terms of both quantity and rate, among other things.
As illustrated, although the average winter loads continue to exceed average summer loads, the Company has seen its highest annual peak loads during the summer months in recent years: Winter Loads Summer Loads Average Peak Month Average Peak Month 2022 2,773 4,113 December 2,529 4,255 July 2021 2,659 3,629 December 2,492 4,453 June 2020 2,566 3,367 December 2,289 3,771 July The Company tracks and evaluates both load growth and peak load requirements for purposes of long-term load forecasting, integrated resource planning, and preparing general rate case assumptions.
As illustrated, although the average winter loads continue to exceed average summer loads, the Company has seen its highest annual peak loads during the summer months in recent years: Winter Loads Summer Loads Average Peak Month Average Peak Month 2023 2,756 3,661 January 2,512 4,498 August 2022 2,773 4,113 December 2,529 4,255 July 2021 2,659 3,629 December 2,492 4,453 June The Company tracks and evaluates both load growth and peak load requirements for purposes of long-term load forecasting, integrated resource planning, and preparing general rate case assumptions.
NVPC consists of the cost of power purchased and fuel used to generate electricity, as well as the cost of settled electric and natural gas financial contracts (all classified as Purchased power and fuel expense in the Company’s consolidated statements of income) and is net of wholesale revenues, which are classified in the consolidated statements of income as Revenues, net.
NVPC consists of the cost of power purchased and fuel used to generate electricity, as well as the cost of settled electric and natural gas financial contracts (all classified as Purchased power and fuel expense in the Company’s consolidated statements of income).
(2) Capacity represents nameplate and differs from expected energy to be generated, which is expected to have a capacity factor range from 30 to 40%, dependent upon wind conditions. (3) Capacity represents net capacity and differs from expected energy to be generated, which is expected to have a capacity factor range from 40 to 50%, dependent upon river flows.
(2) Capacity represents nameplate and differs from expected energy to be generated, which is expected to have a capacity factor range from 30 to 40%, dependent upon wind conditions.
Heating and cooling degree-days, determined by taking the difference between the average daily temperature and a baseline of 65 degrees, provide cumulative variances over a period of time, to indicate the extent to which customers are likely to have used electricity for heating or cooling. The higher the number of degree-days, the greater the expected demand for electricity.
Heating and cooling degree-days, determined by taking the difference between the average daily temperature and a prescribed baseline, provide cumulative variances over a period of time, to indicate the extent to which customers are likely to have used electricity for heating or cooling.
As of December 31, 2022, PGE has six contracts with QFs representing 127 MW of capacity that are not yet operational, of which two of the QF PPAs are in default because the QF has failed to complete construction and become operational by the date required by the PPA.
As of December 31, 2023, PGE had two contracts with QFs representing 116 MW of capacity that are not yet operational, of which one of the QF PPAs is in default because the QF has failed to complete construction and become operational by the date required by the PPA.
Demand from industrial customers is primarily driven by economic conditions, with weather having little impact on this customer class. Customer Choice Programs —Under cost-of-service pricing, residential and small commercial customers may select portfolio options from PGE that include time-of-use and renewable resource pricing.
Demand from industrial customers is primarily driven by economic conditions, with weather having limited impact on this customer class. Customer Choice Programs —In addition to standard cost-of-service pricing, the Company offers different pricing options. Under cost-of-service pricing, residential and small commercial customers may select portfolio options from PGE that include time-of-use and renewable resource pricing.
In March 2021, the OPUC issued an order that expanded the program by 200 MW and provided for the possibility of PGE ownership of the underlying renewable resources under certain conditions. Through this voluntary program, the Company seeks to align sustainability goals, cost and risk management, and reliable integrated power while providing customer choice and a cleaner energy system.
In March 2021, the OPUC issued an order that expanded the program by 200 MW and provided for a utility owned, cost-of-service resource option under certain conditions. Through this voluntary program, the Company seeks to align sustainability goals, cost and risk management, and reliable, integrated power while providing customer choice and a cleaner energy system.
As of December 31, 2022, PGE had contracts with 67 online QFs, providing a total of 315 MW of capacity.
As of December 31, 2023, PGE had contracts with 69 online QFs, providing a total of 315 MW of capacity.
This additional capacity is not reflected in the table above. 16 Table of Contents For additional information on the Green Future Impact Program, see “ Customer Choice Programs ” within the Customers and Revenues section of this Item 1. Short-term contracts —These contracts are for delivery periods of one month up to one year in length.
For additional information on the Green Future Impact Program, see “ Customer Choice Programs ” within the Customers and Revenues section of this Item 1. Short-term contracts —These contracts are for delivery periods of one month to one year in length.
Employees and Collective Bargaining Agreements — PGE had 2,873 employees in its workforce as of December 31, 2022, with 673 employees covered under one of two separate agreements with Local Union No. 125 of the International Brotherhood of Electrical Workers (IBEW). One agreement covers 610 employees, which expires March 2025, and the other covers 63 employees, which expires August 2027.
Employees and Collective Bargaining Agreements — PGE had 2,842 employees in its workforce as of December 31, 2023, with 661 employees covered under one of two separate agreements with Local Union No. 125 of the International Brotherhood of Electrical Workers (IBEW). One agreement, which expires March 2025, covers 596 employees, and the other, which expires August 2027, covers 65 employees.
In the fourth quarter of 2021, PGE and CTWS executed an additional 16-year PPA which begins on January 1, 2025, that effectively extends the term from 2024 to 2040 and increases the capacity payments in the extension period. • Other —The remaining capacity is primarily comprised of two additional contracts that provide for the purchase of power generated from hydroelectric projects with capacity of 236 MW in total: ◦ 200 MW of capacity with Bonneville Power Administration that expires in 2024; and ◦ 36 MW of capacity with Portland Hydro that expires in 2032 PURPA qualifying facilities —PGE is required to purchase power from PURPA qualifying facilities (QFs), as mandated by federal law.
PGE and the CTWS executed an additional 16-year PPA which begins on January 1, 2025, that effectively extends the term from 2024 to 2040 and increases the capacity payments in the extension period. • Other —The remaining capacity is primarily comprised of two additional contracts that provide for the purchase of power generated from hydroelectric projects with capacity of 236 MW in total: ◦ 200 MW of capacity with Bonneville Power Administration (BPA) that expires in February 2024; and ◦ 36 MW of capacity with Portland Hydro that expires in 2032.
Notwithstanding objections that the EPA intended to issue a new rule that took recent changes in the electricity sector into account, on October 29, 2021, the U.S. Supreme Court agreed to hear an appeal of the D.C. Circuit decision.
Circuit vacated the ACE rule and remanded it, in full, back to the EPA. Notwithstanding objections that the EPA intended to issue a new rule that took recent changes in the electricity sector into account, in October 2021, the U.S. Supreme Court agreed to hear an appeal of the D.C. Circuit decision.
To serve Coyote Springs and Carty, PGE has access to 120,000 Dth per day of firm natural gas transportation capacity on three pipeline systems accessing gas fields in Alberta, Canada.
To serve Coyote Springs and Carty, PGE has access to 119,500 Dth per day of firm natural gas transportation capacity on three pipeline systems accessing the gas market in Alberta, Canada.
Wholesale revenues represented 14% of total revenues in 2022, 11% in 2021, and 8% in 2020.
Wholesale revenues represented 14% of total revenues in 2023 and 2022, and 11% in 2021.
In 2018, the EPA proposed the more narrowly focused Affordable Clean Energy (ACE) rule, to repeal and replace the CPP and, in 2019, finalized the ACE rule, which established guidelines for states to develop plans to address GHG emissions from individual, existing coal-fired plants, such as Colstrip in the case of PGE.
In 2019, the EPA finalized the more narrowly focused Affordable Clean Energy (ACE) rule, which established guidelines for states to develop plans to address GHG emissions from individual, existing coal-fired plants, such as Colstrip in the case of PGE, to repeal and replace the CPP. However, in January 2021, the U.S. Court of Appeals for the D.C.
The following table presents PGE’s average winter (defined as January, February, and December) and summer (defined as June through September) loads for the periods presented, along with the corresponding peak load (in MWs) and month in which such peak occurred.
In December 2022, the Company recorded its current winter peak of 4,113 MW. The following table presents PGE’s average winter (defined as January, February, and December) and summer (defined as June through September) loads for the periods presented, along with the corresponding peak load (in MWs) and month in which such peak occurred.
This additional capacity is not reflected in the table above. • a 15-year contract with Avangrid Renewables representing 60 MW from a renewable solar facility in Wasco County, Oregon that is expected to be placed in service in December 2023.
This additional capacity is not reflected in the resource and contracted capacity table above; and • a 25-year contract with Avangrid Renewables representing 60 MW from a renewable solar facility in Wasco County, Oregon that is expected to be placed in service in January 2026. This additional capacity is not reflected in the resource and contracted capacity table above.
The Company implemented a new customer service option, the Green Future Impact Program, which allows for 100 MW of PGE-provided power purchase agreements for renewable resources and up to 200 MW of customer-provided renewable resources. Approved by the OPUC in 2019, the program provides business customers access to bundled renewable attributes from those resources.
As approved by the OPUC in 2019, the Company implemented the Green Future Impact Program, which allowed for 100 MW of PGE-provided power purchase agreements for renewable resources and up to 200 MW of customer-provided renewable resources, that provides commercial and industrial customers access to bundled renewable attributes from those resources.
PGE, incorporated in 1930, is publicly-owned, with its common stock listed on the New York Stock Exchange (NYSE). The Company operates as a single business segment, with revenues and costs related to its business activities maintained and analyzed on a total electric operations basis. The Company owns unregulated, non-utility real estate comprised primarily of PGE’s corporate headquarters.
PGE, incorporated in 1930, is publicly-owned, with its common stock listed on the New York Stock Exchange (NYSE). The Company operates as a single business segment, with revenues and costs related to its business activities maintained and analyzed on a total electric operations basis.
For further information regarding the decoupling mechanism, see “Decoupling” among the Regulatory 9 Table of Contents Matters in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Industrial customers consist of non-residential customers who accept delivery at higher voltages than commercial customers, with pricing based on the amount of electricity delivered under the applicable tariff.
For further information regarding the decoupling mechanism, see “Decoupling” among the Regulatory Matters in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Industrial customers consist of non-residential customers who accept delivery at higher voltages than commercial customers.
If incremental costs were incurred as a result of changes in the regulations regarding GHG emissions, the Company would seek recovery in customer prices. 18 Table of Contents For more information regarding GHG emissions and related environmental regulation, including Oregon’s RPS and the Company’s goals in this area, see “Renewable Energy” under State Regulation in the Regulation section of this Item 1. and “Company Strategy” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Water Quality The federal Clean Water Act requires that any federal license or permit to conduct an activity that may result in a discharge to waters of the United States must first receive a water quality certification or permit from the state in which the activity will occur.
For more information regarding GHG emissions and related environmental regulation, including Oregon’s RPS and the Company’s goals in this area, see “Renewable Energy” under State Regulation in the Regulation section of this Item 1. and “Company Strategy” in the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Water Quality Under the federal Clean Water Act, entities that require any federal license or permit to conduct an activity that may result in a discharge to waters of the United States must first receive a water quality certification or permit from the state in which the activity will occur, or obtain an appropriate waiver.
Two of these projects extend to 2036 while the other two extend to 2037 and 2042. The expected energy from these solar resources will vary from the nameplate capacity due to varying solar conditions. Construction on the solar and battery components of Wheatridge was completed in 2022. The solar component of Wheatridge supplies the Company with 50 MW of capacity.
Two of these projects extend to 2036 while the other three extend to 2037, 2038, and 2042, respectively. The expected energy from these solar resources will vary from the nameplate capacity due to varying solar conditions. The solar component of Wheatridge supplies the Company with 50 MW of capacity.
GAAP provides for the deferral, as regulatory assets, of certain actual or estimated costs that would otherwise be charged to expense, based on expected recovery from customers in future prices.
As a result, the Company may record regulatory assets, of certain actual or estimated costs that would otherwise be charged to expense, based on expected recovery from customers in future prices.
In December 2021, the OPUC issued an order, which approved a petition to increase capacity under the customer-provided renewable resources by 250 MW, which brings the total available capacity under the program to 750 MW.
In December 2021, the OPUC issued an order, which further increased capacity under the customer-provided renewable resources by 250 MW, to bring the total available capacity under the program to 750 MW.
The following table presents the heating and cooling degree-days for the most recent three-year period, along with current 15-year averages for the most recent year provided by the National Weather Service, as measured at Portland International Airport: Heating Degree-Days Cooling Degree-Days 2022 4,103 865 2021 3,828 838 2020 3,836 600 15-year average 4,103 569 In June 2021, PGE set a new all-time high net system load peak of 4,453 megawatts (MW), surpassing the previous all-time peak that occurred in December 1998 by more than 9%.
The greater the number of degree-days, the greater the expected demand for electricity. 12 Table of Contents The following table presents the heating and cooling degree-days for the most recent three-year period, along with current 15-year averages for the most recent year provided by the National Weather Service, as measured at Portland International Airport: Heating Degree-Days Cooling Degree-Days 2023 3,845 898 2022 4,103 865 2021 3,828 838 15-year average 4,085 600 In August 2023, PGE set a new all-time high net system load peak of 4,498 megawatts (MW), surpassing the previous all-time peak that occurred in June 2021.
In addition to the agencies and activities discussed below, the Company is subject to regulation by certain environmental agencies, as described in the Environmental Matters section in this Item 1. Federal Regulation Several federal agencies, including the Federal Energy Regulatory Commission (FERC), the U.S.
In addition to the agencies and activities discussed below, the Company is subject to regulation by certain environmental agencies, as described in the Environmental Matters section in this Item 1.
The facility also includes 30 MW related to the battery component which is not reflected in the table above. Subsidiaries of NextEra Energy Resources, LLC own the solar and battery components, and sell their portion of the output to PGE. Biomass —PGE has one contract to purchase biomass energy that is set to expire in June 2023.
The facility also includes 30 MW related to the battery component which is not reflected in the resource and contracted capacity table above. Subsidiaries of NextEra Energy Resources, LLC own the solar and battery components, and sell their portion of the output to PGE.
PGE is a market participant in the western EIM, which allows certain of the Company’s generating plants to receive automated dispatch signals from the California Independent System Operator (CAISO) for load balancing with other western EIM participants in five-minute intervals.
Such purchases are made under contracts that range in duration from 15 minutes to less than one month. PGE is a market participant in the western EIM, which allows certain of the Company’s generating plants to receive automated dispatch signals from the California Independent System Operator (CAISO) for load balancing with other western EIM participants in five-minute intervals.
This additional capacity is not reflected in the table above; and • a 15-year contract with Avangrid Renewables representing 138 MW from a renewable solar facility in Wasco County, Oregon that is expected to be placed in service in December 2023.
This capacity is reflected within solar purchased power in the resource and contracted capacity table above; • a 25-year contract with Avangrid Renewables representing 138 MW from a renewable solar facility in Wasco County, Oregon that is expected to be placed in service in January 2026.
Such standards, which are applicable to PGE, were developed by the North American Electric Reliability Corporation (NERC) and the Western Electricity Coordinating Council (WECC), which have responsibility for compliance and enforcement of these standards, and are intended to help protect critical cyber and physical assets used to support reliable operations.
Such standards, which are applicable to PGE, were developed by the North American Electric Reliability Corporation (NERC) and the Western Electricity Coordinating Council (WECC), which have responsibility for compliance and enforcement of these standards, and are intended to help maintain and strengthen the reliable planning and operation of the bulk electric system.
The OPUC has approved an Annual Power Cost Update Tariff (AUT) by which PGE can adjust retail customer prices annually to reflect forecasted changes in the Company’s net variable power costs (NVPC).
The OPUC authorizes the Company’s rate base, debt-to-equity capital structure, return on equity, overall rate of return, and customer prices. • Annual Power Cost Updates . The OPUC has approved an Annual Power Cost Update Tariff (AUT) by which PGE can adjust retail customer prices annually to reflect forecasted changes in the Company’s net variable power costs (NVPC).
Other operating revenues represented 2% of total revenues in 2022, 3% in 2021, and 2% in 2020. Seasonality Demand for electricity by PGE’s residential and, to a lesser extent, commercial customers is affected by seasonal weather conditions. The Company uses heating and cooling degree-days to determine the effect of weather on the demand for electricity.
Other operating revenues represented 2% of total revenues in 2023 and 2022, and 3% in 2021. Seasonality Demand for electricity by PGE’s residential and, to a lesser extent, commercial and industrial customers is affected by seasonal weather conditions.
By purchasing a portion of anticipated energy needs for future years over an extended period, PGE mitigates a portion of the potential future volatility in the average cost of purchased power and fuel. 14 Table of Contents The Company’s major power purchase contracts consist of the following (also see the preceding table which summarizes the average resource capabilities related to these contracts): Hydro —During 2022, the Company had the following agreements: • Public Utility Districts —PGE has long-term power purchase contracts with certain public utility districts (PUDs) in the state of Washington for a portion of the output of two hydroelectric projects on the mid-Columbia River.
The Company’s major power purchase contracts consist of the following (also see the preceding table which summarizes the average resource capabilities related to these contracts): Hydro —During 2023, the Company had the following agreements: • Public Utility Districts —PGE has long-term power purchase contracts with certain public utility districts (PUDs) in the state of Washington for a portion of the output of two hydroelectric projects on the mid-Columbia River.
Bekkedahl 61 Senior Vice President, Advanced Energy Delivery (July 2021 to present), Vice President, Grid Architecture, Integration and Systems Operations (January 2019 to July 2021), Vice President Transmission and Distribution (August 2014 to January 2019).
Bekkedahl 62 Senior Vice President, Strategy and Advanced Energy Delivery (December 2023 to present) Senior Vice President, Advanced Energy Delivery (July 2021 to December 2023), Vice President, Grid Architecture, Integration and Systems Operations (January 2019 to July 2021). 2014 M.
Any laws that would impose taxes or mandatory reductions in GHG emissions may have a material impact on PGE’s operations, as the Company utilizes fossil fuels in its own power generation and other companies use such fuels to generate power that PGE purchases in the wholesale market.
For additional information, see “HB 2021” in the Laws and Regulations section of the Overview section of Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Any laws that would impose taxes or mandatory reductions in GHG emissions may have a material impact on PGE’s operations, as the Company utilizes fossil fuels in its own power generation and other companies use such fuels to generate power that PGE purchases in the wholesale market.
PGE has contracted 19 Table of Contents with the USDOE for permanent disposal of spent nuclear fuel from Trojan that is stored in the Independent Spent Fuel Storage Installation (ISFSI), an NRC-licensed interim dry storage facility that houses the fuel.
PGE has contracted with the USDOE for permanent disposal of spent nuclear fuel from Trojan that is stored in the Independent Spent Fuel Storage Installation (ISFSI), an NRC-licensed interim dry storage facility that houses the fuel. The NRC approved the transfer of spent nuclear fuel to the ISFSI where it is expected to remain until permanent off-site storage is available.
PGE and NextEra Energy Resources, LLC, a subsidiary of NextEra Energy, Inc. have entered into agreements to construct a 311 MW wind energy facility, which will be part of the larger Clearwater Wind development in Eastern Montana. This additional wind capacity is not reflected in the table above.
The expected energy from these wind resources will vary from the nameplate capacity due to varying wind conditions. PGE and NextEra Energy Resources, LLC, a subsidiary of NextEra Energy, Inc. have entered into agreements to construct a 311 MW wind energy facility, which will be part of the larger Clearwater Wind Development in Eastern Montana.
Angelica Espinosa 45 Vice President, General Counsel (March 2022 to present), Deputy General Counsel and Corporate Secretary (June 2021 to March 2022), Chief Risk Officer and Vice President of Safety and Compliance at Southern California Gas Company (January 2019 to June 2021), Vice President, Compliance & Governance and Corporate Secretary at Sempra Energy (November 2016 to January 2019) 2022 Bradley Y.
Angelica Espinosa 46 Senior Vice President, Chief Legal and Compliance Officer (June 2023 to present) Vice President, General Counsel (March 2022 to June 2023), Deputy General Counsel and Corporate Secretary (June 2021 to March 2022), Chief Risk Officer and Vice President of Safety and Compliance at Southern California Gas Company (January 2019 to June 2021). 2022 Benjamin F.
Long-term recovery plans for these species continue to have operational impacts on many of the region’s hydroelectric projects. PGE continues to implement fish protection measures at its hydroelectric projects that were prescribed by the U.S. Fish and Wildlife Service and the National Marine Fisheries Service under their authority granted in the ESA and the FPA.
PGE continues to implement fish protection measures at its hydroelectric projects that were prescribed by the U.S. Fish and Wildlife Service and the National Marine Fisheries Service under their authority granted in the ESA and the FPA.
For more information on the Company’s power purchase agreements that currently serve the Green Future Impact Program, see “Green Future Impact Program” within Purchased Power in the Power Supply section of this Item 1. Wholesale Revenues PGE participates in the wholesale electricity marketplace in order to balance its supply of power to meet the needs of its retail customers.
For more information on the Company’s power purchase agreements that currently serve the Green Future Impact Program, see “Green Future Impact Program” within Purchased Power in the Power Supply section of this Item 1.
They are entered into with various counterparties to provide additional firm energy to help meet the Company’s load requirements. PGE also utilizes spot purchases of power in the open market to secure the energy required to serve its retail customers. Such purchases are made under contracts that range in duration from 15 minutes to less than one month.
They are entered into with various counterparties to provide additional firm energy to help meet the Company’s load requirements. 18 Table of Contents PGE also utilizes spot purchases of power in the open market to secure the energy required to serve its retail customers.
The NRC approved the transfer of spent nuclear fuel from a spent fuel pool to the ISFSI where it is expected to remain until permanent off-site storage is available. Shipment of the spent nuclear fuel from the ISFSI to off-site storage is not expected to be completed prior to 2059.
Shipment of the spent nuclear fuel from the ISFSI to off-site storage is not expected to be completed prior to 2059.
Natural Gas Physical supplies of natural gas are generally purchased up to twelve months in advance of delivery and based on anticipated operation of the plants. PGE manages the price risk of natural gas supply through the use of financial contracts up to 60 months in advance of expected need of energy.
Natural Gas Physical supplies of natural gas are generally purchased up to twelve months in advance of delivery and based on anticipated operation of the plants.
The baseline levels for PGE are the average annual emissions for the years 2010, 2011, and 2012 associated with the electricity sold to its retail electricity consumers as reported to the Oregon Department of Environmental Quality (ODEQ). See “HB 2021” in the Laws and Regulations section of the Overview for additional information.
The baseline levels for PGE are the average annual emissions for the years 2010, 2011, and 2012 associated with the electricity sold to its retail electricity consumers as reported to the ODEQ.
PGE conducts employee engagement surveys periodically to give employees the opportunity to share their perspectives and provide feedback. Survey results are shared with PGE management so that managers can take action towards improving the employee experience. Health and Safety — PGE is committed to providing a safe and healthy place of business for employees, customers, and the public.
Survey results are shared with PGE management so that managers can take action towards improving the employee experience. Health and Safety — PGE is committed to providing a safe and healthy place of business for employees, customers, and the public. Management has established an Executive Safety Council that has oversight of the Company’s efforts to create a safe workplace.
Likewise, certain actual or anticipated credits that would otherwise be recognized as revenue or reduce expense can be deferred as regulatory liabilities, based on expected future credits or refunds to customers. PGE records regulatory assets or liabilities if it is probable that they will be reflected in future prices, based on regulatory orders or other available evidence.
Likewise, certain actual or anticipated credits that would otherwise be recognized as revenue, or reduce expense, can be deferred as regulatory liabilities, based on expected future credits or refunds to customers.
PGE and NextEra Energy Resources, LLC, a subsidiary of NextEra Energy, Inc. have entered into agreements to construct a 311 MW wind energy facility, which will be part of the larger Clearwater Wind development in Eastern Montana. This additional wind capacity is not reflected in the table above.
PGE and NextEra Energy Resources, LLC, a subsidiary of NextEra Energy, Inc. have entered into agreements to construct a 311 MW wind energy facility, which will be part of the larger Clearwater Wind Development in Eastern Montana (Clearwater). Substantial completion of the project was achieved on January 5, 2024. PGE will own 208 MW of production capacity in these agreements.
For a complete listing of these facilities, see “ Generating Facilities ” in Item 2.—“Properties.” Thermal The Company has five natural gas-fired generating facilities: PW1, PW2, Beaver, Coyote Springs Unit 1 (Coyote Springs), and Carty Generating Station (Carty).
For a complete listing of these facilities, see “ Generating Facilities ” in Item 2.—“Properties.” Thermal The Company has five natural gas-fired generating facilities: PW1, PW2, Beaver, Coyote Springs Unit 1 (Coyote Springs), and Carty Generating Station (Carty). 14 Table of Contents The Company also has a 20% ownership interest in the Colstrip Units 3 and 4 coal-fired generating plant (Colstrip), which is located in Colstrip, Montana and operated by a third party.
PGE owns 79.5%, and is the operator of record, of the KB Pipeline, which directly connects PW1, PW2, and Beaver to the Northwest Pipeline, an interstate natural gas pipeline operating between British Columbia and New Mexico.
PGE manages the price risk of natural gas supply through the use of financial contracts up to 60 months in advance of expected need of energy. 15 Table of Contents PGE owns 79.5%, and is the operator of record, of the KB Pipeline, which directly connects PW1, PW2, and Beaver to the Northwest Pipeline, an interstate natural gas pipeline operating between British Columbia and New Mexico by Williams.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeLack of availability of mutual aid support could result in increased time to restore services to customers as well as increased costs and decreased customer satisfaction. 22 Table of Contents Wildfires of greater size and prevalence, such as those of a magnitude seen in Oregon in recent years, could negatively affect public safety, the resilience of the electric grid, customers’ demand for power and PGE’s ability and cost to procure adequate power and fuel supplies to serve its customers, PGE ’s ability to access the wholesale energy market, PGE’s ability to operate its generating facilities and transmission and distribution systems, PGE’s costs to maintain, repair, and replace such facilities and systems, and recovery of costs.
Biggest changeWildfires of greater size and prevalence, such as those of a magnitude seen in Oregon in recent years, could negatively affect public safety, the resilience of the electric grid, customers’ demand for power and PGE’s ability and cost to procure adequate power and fuel supplies to provide reliable service to its customers, PGE’s ability to access the wholesale energy market, PGE’s ability to operate its generating facilities and transmission and 24 Table of Contents distribution systems, PGE’s costs to maintain, repair, and replace such facilities and systems, and recovery of costs.
In addition, failure to complete construction projects according to specifications could result in reduced plant efficiency, equipment failure, and plant performance that falls below expected levels, which could increase operating costs. REGULATORY, LEGAL, AND COMPLIANCE RISKS PGE is subject to extensive price regulation and relies on recovery of costs, the uncertainty of which affect the Company’s operations and costs.
In addition, failure to complete construction projects according to specifications could result in reduced plant efficiency, equipment failure, and plant performance that falls below expected levels, which could increase operating costs. REGULATORY, LEGAL, AND COMPLIANCE RISKS PGE is subject to extensive price regulation and relies on recovery of costs, the uncertainty of which could affect the Company’s operations and costs.
Conversely, if power and natural gas prices rise, especially during periods when the Company requires greater-than-expected volumes that must be purchased at market or short-term prices, PGE could incur greater costs than originally estimated. PGE’s contract positions are not fully hedged against commodity prices, and hedges or other risk mitigations may not protect against significant losses.
Conversely, if power and natural gas prices rise, especially during periods when the Company requires greater-than-expected volumes that must be purchased at market or short-term prices, PGE could incur greater costs than originally estimated. PGE’s contract positions may not be fully hedged against commodity prices, and hedges or other risk mitigations may not protect against significant losses.
Capital investment and operating expenses related to this risk may not be recoverable through increases in customer prices. Cybersecurity attacks, data security breaches, physical attacks and security breaches, acts of terrorism, or other similar events that could disrupt PGE’s operations, require significant expenditures, or result in claims against the Company.
Capital investment and operating expenses related to this risk may not be recoverable through increases in customer prices. Cybersecurity attacks, data security breaches, physical attacks and security breaches, acts of terrorism, or other similar events could disrupt PGE’s operations, require significant expenditures, or result in claims against the Company.
These risks could cause significant harm to workers and the public including loss of human life, significant damage to property, adverse impacts on the environment and impairment of PGE’s operations, all of which could result in financial losses that would have a material adverse effect on the Company’s results of operations and financial condition.
These risks could cause significant harm to workers and the public including loss of human life, significant damage to property, adverse impacts on the environment and impairment of PGE’s operations, all of which could result in financial losses that would have a material adverse effect on the Company’s results of operations and financial condition and reputational harm.
Also, new interpretations of existing laws and regulations could be adopted or become applicable to such facilities, which could further increase required expenditures for salmon recovery and endangered species protection and reduce the availability of hydroelectric or wind generating resources to meet the Company’s energy requirements.
Also, changes to and new interpretations of existing laws and regulations could be adopted or become applicable to such facilities, which could further increase required expenditures for salmon recovery and endangered species protection and reduce the availability of hydroelectric or wind generating resources to meet the Company’s energy requirements.
Any such actions could have a material adverse effect on the Company’s financial condition and results of operations and could cause significant fluctuations in the trading prices of its common stock based on market perceptions or other factors.
Any such actions could have a material adverse effect on the Company’s financial condition and results of operations and could cause fluctuations in the trading prices of its common stock based on market perceptions or other factors.
For additional information, see Item 3.—“Legal Proceedings,” Regulatory Matters within the “Overview” of Item 7.— “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Note 19, Contingencies, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Compliance with environmental laws and regulations may result in capital expenditures, increased operating costs and various liabilities, and adverse impact on the Company’s results of operations.
For additional information, see Item 3.—“Legal Proceedings,” Regulatory Matters within the “Overview” of Item 7.— “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Note 19, Contingencies, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Compliance with environmental laws and regulations may result in capital expenditures, increased operating costs and various liabilities, and adverse impacts on the Company’s results of operations.
In addition, such decreases can require that PGE make additional payments to satisfy its obligations under these plans. 28 Table of Contents The volatility of market prices for power and natural gas could adversely affect PGE’s costs and ability to manage its energy supply, which could negatively impact the Company’s liquidity and results of operations.
In addition, such decreases can require that PGE make additional payments to satisfy its obligations under these plans. 31 Table of Contents The volatility of market prices for power and natural gas could adversely affect PGE’s costs and ability to manage its energy supply, which could negatively impact the Company’s liquidity and results of operations.
Under certain circumstances, banks participating in PGE’s syndicated unsecured revolving credit facility could decline to fund advances requested by the Company or could withdraw from participation in the credit facility, which could adversely affect PGE’s liquidity. PGE currently has a syndicated unsecured revolving credit facility with several banks for an aggregate amount of $650 million.
Under certain circumstances, banks participating in PGE’s syndicated unsecured revolving credit facility could decline to fund advances requested by the Company or could withdraw from participation in the credit facility, which could adversely affect PGE’s liquidity. PGE currently has a syndicated unsecured revolving credit facility with several banks for an aggregate amount of $750 million.
Changes to the listing of various plants and species of fish, birds, and other wildlife as threatened or endangered could result in increased mitigation activities, which could have a material impact on PGE’s financial condition and results of 25 Table of Contents operations.
Changes to the listing of various plants and species of fish, birds, and other wildlife as threatened or endangered could result 28 Table of Contents in increased mitigation activities, which could have a material impact on PGE’s financial condition and results of operations.
The Company cannot predict with certainty the future course 24 Table of Contents of such changes or the ultimate effect that they might have on its business, and such changes could delay or adversely affect business planning and transactions and substantially increase the Company’s costs.
The Company cannot predict with certainty the future course 27 Table of Contents of such changes or the ultimate effect that they might have on its business, and such changes could delay or adversely affect business planning and transactions and substantially increase the Company’s costs.
Customer demand could also be negatively impacted by PGE’s ability to attract and retain customers, mandated energy efficiency measures, demand side management programs, potential formation of community choice aggregation programs, distributed generation resources, and economic and demographic conditions, such as population changes, job and income growth, new construction, new business formation and the overall level of economic activity.
Customer demand could also be negatively impacted by PGE’s ability to attract and retain customers, mandated energy efficiency measures, demand side management programs, potential formation of community choice aggregation programs, distributed generation resources, and economic and demographic conditions, such as 29 Table of Contents population changes, job and income growth, new construction, new business formation and the overall level of economic activity.
Investors, lenders, rating agencies, customers, regulators, employees, and other stakeholders are increasing their focus on evaluating companies as corporate citizens based on their ESG programs and metrics.
Investors, lenders, rating agencies, customers, regulators, state legislatures, employees, and other stakeholders are increasing their focus on evaluating companies as corporate citizens based on their ESG programs and metrics.
It is also possible that alternative generation or storage resources are mandated, subsidized, or encouraged through legislation or regulation or otherwise are economically competitive and added to the available generation supply. Competitors may not be subject to the same operating, regulatory and financial requirements that the Company is, potentially causing a substantial competitive disadvantage for PGE.
It is also possible that alternative generation or storage resources are mandated, subsidized, or encouraged through legislation or regulation or otherwise are economically competitive and added to the available generation supply. Competitors may not be subject to the same operating, regulatory and financial requirements that the Company is, 33 Table of Contents potentially causing a substantial competitive disadvantage for PGE.
These events may disrupt energy delivery, cause power outages, and damage the Company’s facilities and transmission and distribution system. Such events could result in a reduction in revenue and an increase in additional costs to restore service, repair facilities, purchase power and fuel to serve PGE load, and procure insurance related to such impacts.
These events may disrupt energy delivery, cause power outages, or impair the use of, and damage, the Company’s facilities and transmission and distribution system. Such events could result in a reduction in revenue and an increase in additional costs to restore service, repair facilities, purchase power and fuel to serve PGE load, and procure insurance related to such impacts.
PGE may be unable to effectively implement a public safety power shutoff (PSPS) and de-energize its system in the event of heightened wildfire risk, or the PSPS may not be able to prevent a wildfire, which could lead to potential liability if energized systems are determined to be the cause of wildfires that result in harm.
PGE may be unable to effectively implement a PSPS and de-energize its system in the event of heightened wildfire risk, or the PSPS may not be able to prevent a wildfire, which could lead to potential liability if energized systems are determined to be the cause of wildfires that result in harm.
Such events, if repeated or prolonged, can also affect customer satisfaction and the level of regulatory oversight. 23 Table of Contents Electric utility operations may pose risk to public and workers’ safety.
Such events, if repeated or prolonged, can also affect customer satisfaction and the level of regulatory oversight. 25 Table of Contents 26 Table of Contents Electric utility operations may pose risk to public and workers’ safety.
At December 31, 2022, $399 million of accumulated net income was available for payment of dividends under this provision. 27 Table of Contents Adverse changes in PGE’s credit ratings could negatively affect its access to the capital markets and its cost of borrowed funds.
At December 31, 2023, $401 million of accumulated net income was available for payment of dividends under this provision. 30 Table of Contents Adverse changes in PGE’s credit ratings could negatively affect its access to the capital markets and its cost of borrowed funds.
Although the application of the PCAM could help mitigate adverse financial effects from any decrease in power supply, full recovery of any increase in power costs is not assured.
Although the application of the PCAM or specific contract terms could help mitigate adverse financial effects from any decrease in power supply, full recovery of any increase in power costs is not assured.
PGE owns and operates renewable generating facilities, which generate federal production tax credits (PTCs) that PGE uses to reduce its federal tax obligations. The amount of PTCs earned depends on the level of electricity output generated and the applicable tax credit rate.
PGE owns and operates renewable generating facilities and will own battery storage facilities, which generate federal production tax credits (PTCs) and investment tax credits (ITCs) that PGE uses to reduce its federal tax obligations. The amount of PTCs earned depends on the level of electricity output generated and the applicable tax credit rate.
PGE also owns unregulated properties that are currently or previously leased to third parties and located adjacent to PGE’s T.W. Sullivan hydro generating facility. PGE has recorded a non-utility asset retirement obligation (ARO) for this site related to assets that are no longer in service.
A significant change in real estate values could adversely affect PGE’s results of operations. PGE also owns unregulated properties that are currently or previously leased to third parties and located adjacent to PGE’s T.W. Sullivan hydro generating facility. PGE has recorded a non-utility asset retirement obligation (ARO) for this site related to assets that are no longer in service.
In addition, sales or issuances of substantial amounts of PGE’s common stock in the public market, including upon settlement of the forward sale agreements entered into in 2022, could cause the market price of PGE’s common stock to decline. This could impair the Company’s ability to raise additional capital through the sale of equity securities.
In addition, sales or issuances of substantial amounts of PGE’s common stock in the public market could cause the market price of PGE’s common stock to decline. This could impair the Company’s ability to raise additional capital through the sale of equity securities.
Dealing with such actions could result in substantial costs and divert management’s and the Company’s board’s attention and resources from PGE’s business and execution of its strategy.
Dealing with such actions could result in disruption to company operations, and divert management’s and the Company’s board’s attention and resources from PGE’s business and execution of its strategy.
Some or all of these factors could impact the demand for electricity. 26 Table of Contents The decline in revenues due to decreased customer demand for electricity may increase customer prices for remaining customers, as PGE’s revenue requirement is designed to cover its fixed utility operating expenses.
Development, improvement, and adoption of technological advances could lead to declines in energy use per customer. Some or all of these factors could impact the demand for electricity. The decline in revenues due to decreased customer demand for electricity may increase customer prices for remaining customers, as PGE’s revenue requirement is designed to cover its fixed utility operating expenses.
These concentrations may also increase exposure to credit and operational risks due to counterparties, suppliers, and customers being similarly affected by changing conditions.
These concentrations may also 34 Table of Contents increase exposure to credit and operational risks due to counterparties, suppliers, and customers being similarly affected by changing conditions. ITEM 1B. UNRESOLVED STAFF COMMENTS. None.
PGE owns and operates generation, transmission, distribution, and other facilities that depend on information technology systems. A cyber-attack may cause large-scale disruption to the U.S. bulk power system or PGE operations and could target the Company’s computer systems, software, or networks to achieve such disruption.
A cyber-attack may cause large-scale disruption to the U.S. bulk power system or PGE operations and could target the Company’s computer systems, software, or networks to achieve such disruption. Generation, transmission, and distribution facilities, in general, have been identified as potential targets of physical or cyber-attacks.
Changes in market conditions and environmental laws and regulations could negatively impact PGE’s non-utility real estate investments. PGE owns, through a wholly owned subsidiary, its corporate headquarters building located in Portland, Oregon. A significant change in real estate values could adversely affect PGE’s results of operations.
Such a development could limit the Company’s future growth opportunities and limit growth in demand for PGE’s electric service. Changes in market conditions and environmental laws and regulations could negatively impact PGE’s non-utility real estate investments. PGE owns, through a wholly owned subsidiary, its corporate headquarters building located in Portland, Oregon.
There is no assurance that PGE’s risk management procedures will be effective in preventing or mitigating losses, and could have a material adverse effect on the Company’s results of operation and financial condition. Reduced river flows, unfavorable wind conditions, and forced outages at generating and battery storage facilities can increase the cost of power required to serve customers.
There is no assurance that PGE’s risk management procedures will be effective in preventing or mitigating losses, and could have a material adverse effect on the Company’s results of operation and financial condition.
Generation, transmission, and distribution facilities, in general, have been identified as potential targets of physical or cyber-attacks. In addition, physical attacks on transmission and distribution facilities have occurred in the United States.
In addition, physical attacks on transmission and distribution facilities have occurred in the United States.
Changes in public policy, such as new tax incentives that PGE cannot take advantage of or efforts to deregulate the utility industry, could provide an advantage to competitors.
Changes in public policy, such as new tax incentives that PGE cannot take advantage of or efforts to deregulate the utility industry, could provide an advantage to competitors. Such alternative resources and regulatory or legislative actions could displace higher marginal cost generating units or make PGE less competitive in constructing, owning, and operating such facilities.
Unfavorable wind conditions could require increased reliance on power from the Company’s thermal generating resources or power purchases in the wholesale market, both of which could have an adverse effect on results of operations. 29 Table of Contents Forced outages at generating facilities and battery storage facilities, both PGE-owned or under purchased power agreements, could result in power costs greater than those included in customer prices, in addition to increased repair and maintenance costs.
Forced outages at generating facilities and battery storage facilities, both PGE-owned or under purchased power agreements, could result in power costs greater than those included in customer prices, in addition to increased repair and maintenance costs.
In response to more intense, frequent, and severe weather events, PGE may need to make additional investments in generation, transmission, and distribution assets to enhance reliability and resiliency. Severe weather may also require increased PGE personnel availability, which could result in increased operating expenses as well increased safety risk.
The increase in additional costs could also have an adverse effect on cash flow and liquidity. In response to more intense, frequent, and severe weather events, PGE may need to make additional investments in generation, transmission, and distribution assets to enhance reliability and resiliency.
If PGE cannot generate enough taxable income in the future to utilize all of the tax credit carryforwards before the credits expire, the Company may incur material charges to earnings. ECONOMIC, FINANCIAL, AND MARKET RISKS A decrease in customer demand for electricity may negatively impact PGE’s business.
If PGE cannot generate enough taxable income in the future to utilize all of the tax credit carryforwards before the credits expire, the Company may incur material charges to earnings. The Inflation Reduction Act of 2022 allows for the sale or transfer of renewable tax credits to other taxpayers.
In certain instances, PGE relies on mutual aid support to assist in the recovery from severe weather.
Weather-related events could also cause system constraints or disrupt transmission flows, resulting in decreased reliability for customers. Severe weather may also require increased PGE personnel availability, which could result in increased operating expenses as well as increased safety risk. In certain instances, PGE relies on mutual aid support to assist in the recovery from severe weather.
Removed
Development, improvement, and adoption of technological advances could lead to declines in energy use per customer.
Added
Lack of availability of mutual aid support could result in increased time to restore services to customers as well as increased costs and decreased customer satisfaction.
Removed
Such alternative resources and regulatory or legislative actions could displace higher marginal cost generating units or make PGE less competitive in constructing, owning, and operating such facilities. 30 Table of Contents Such a development could limit the Company’s future growth opportunities and limit growth in demand for PGE’s electric service.
Added
PGE owns and operates generation, transmission, distribution, and other facilities that depend on information technology systems. The Company is exposed to, and may be adversely affected by, interruptions to its computer and information technology systems and sophisticated cyber-attacks. As with most companies, PGE has experienced attempts to breach the Company’s systems and other similar incidents.
Added
PGE continuously seeks to maintain a robust program of security and controls, but the impact of a physical or material information technology event could have a material adverse effect on the Company’s competitive position, reputation, results of operations, financial condition and cash flows.
Added
The Company has sold and plans to continue to sell tax credits. PGE’s inability to generate, transfer, or sell these credits could have a material impact on results of operations. ECONOMIC, FINANCIAL, AND MARKET RISKS A decrease in customer demand for electricity may negatively impact PGE’s business.
Added
A new mechanism, the Reliability Contingency Event (RCE), which, like the PCAM, allows for cost sharing and deferral of certain costs for specific events, was introduced through the 2024 General Rate Case,. This mechanism expires at the end of 2025.
Added
Reduced river flows, unfavorable wind conditions, reduced capacity or degradation of solar panels, and forced outages at generating and battery storage facilities can increase the cost of power required to serve customers.
Added
Unfavorable wind conditions could require increased reliance on power from the Company’s 32 Table of Contents thermal generating resources or power purchases in the wholesale market, both of which could have an adverse effect on results of operations.

Item 2. Properties

Properties — owned and leased real estate

7 edited+4 added−4 removed3 unchanged
Biggest changeGenerating Facilities The following are generating facilities owned by PGE as of December 31, 2022 (in MW): Facility Location Net Capacity (1) Wholly-owned: Natural Gas or Oil: Beaver Clatskanie, Oregon 510 Carty Boardman, Oregon 438 Port Westward Unit 1 (PW1) Clatskanie, Oregon 411 Coyote Springs Boardman, Oregon 258 Port Westward Unit 2 (PW2) Clatskanie, Oregon 225 Wind: Biglow Canyon Sherman County, Oregon 450 Tucannon River Columbia County, Washington 267 Wheatridge Morrow County, Oregon 100 Hydro: North Fork Clackamas River 58 Faraday Clackamas River 46 Oak Grove Clackamas River 45 River Mill Clackamas River 25 T.W.
Biggest changeThe Indenture securing the Company’s First Mortgage Bonds (FMBs) constitutes a direct first mortgage lien on substantially all utility property and franchises, other than expressly excepted property. 36 Table of Contents Generating Facilities The following are generating facilities owned by PGE as of December 31, 2023 (in MW): Facility Location Capacity Wholly-owned: Natural Gas or Oil (1) : Beaver Clatskanie, Oregon 511 Carty Boardman, Oregon 436 Port Westward Unit 1 (PW1) Clatskanie, Oregon 393 Coyote Springs Boardman, Oregon 257 Port Westward Unit 2 (PW2) (2) Clatskanie, Oregon 214 Wind (3) : Biglow Canyon Sherman County, Oregon 450 Tucannon River Columbia County, Washington 267 Wheatridge Morrow County, Oregon 100 Hydro (4) : North Fork Clackamas River 56 Faraday Clackamas River 46 Oak Grove Clackamas River 43 River Mill Clackamas River 25 T.W.
The Northwest AC Intertie is used primarily for the transmission of interstate purchases and sales of electricity among utilities, including PGE. In addition, the Company has contractual rights to the total of 3,920 MW of BPA transmission systems. Non-utility Real Estate PGE owns, through a wholly owned subsidiary, its corporate headquarters building located in Portland, Oregon.
The Northwest AC Intertie is used primarily for the transmission of interstate purchases and sales of electricity among utilities, including PGE. In addition, the Company has contractual rights to a total of 3,970 MW of BPA transmission systems. Non-utility Real Estate PGE owns, through a wholly owned subsidiary, its corporate headquarters building located in Portland, Oregon.
The Company also has an ownership interest in, and capacity on, the following: • 14% of the 2,260 MW transmission facilities between the Colstrip switchyard to the Broadview switchyard, near Billings, Montana, and 16% of the 1,930 MW transmission facilities between the Broadview switchyard and the interconnection point with BPA’s transmission system near Townsend, Montana; and • 20% of the Northwest AC Intertie, a 4,800 MW transmission facilities between the John Day Substation near the Columbia River in northern Oregon, and Malin, Oregon, near the California border.
PGE also has an ownership interest in, and capacity on, the following: • 14% of the 2,260 MW transmission facilities between the Colstrip switchyard to the Broadview switchyard, near Billings, Montana, and 16% of the 1,930 MW transmission facilities between the Broadview switchyard and the interconnection point with BPA’s transmission system near Townsend, Montana; and • 20% of the Northwest AC Intertie, a 4,800 MW transmission facility between the John Day Substation near the Columbia River in northern Oregon, and Malin, Oregon, near the California border.
As of December 31, 2022, the non-utility property, plant, and equipment balance, net of accumulated depreciation was $73 million, recorded in Other noncurrent assets on the Company’s consolidated balance sheets in Item 8. — “Financial Statements and Supplementary Data.” PGE also owns unregulated properties that are currently or previously leased to third parties and located adjacent to PGE’s T.W.
As of December 31, 2023, the non-utility property, plant, and equipment balance, net of accumulated depreciation was $75 million, recorded in Other noncurrent assets on the Company’s consolidated balance sheets in Item 8. — “Financial Statements and Supplementary Data.” PGE also owns unregulated properties that are currently or previously leased to third parties and located adjacent to PGE’s T.W.
Sullivan Willamette River 18 Jointly-owned (2) : Coal: Colstrip (3) Colstrip, Montana 296 Hydro: Round Butte (4) Deschutes River 172 Pelton (4) Deschutes River 55 Net capacity 3,374 (1) Represents net capacity of generating unit as demonstrated by actual operating or test experience, net of electricity used in the operation of a given facility.
Sullivan Willamette River 18 Jointly-owned (2) : Coal: Colstrip (5) Colstrip, Montana 296 Hydro (4) : Round Butte (6) Deschutes River 187 Pelton (6) Deschutes River 57 Capacity 3,356 (1) Represents net capacity of generating unit as demonstrated by actual operating or test experience, net of electricity used in the operation of a given facility. (2) Represents PGE’s ownership share.
As of December 31, 2022, PGE-owned electric transmission system consisted of 1,255 circuit miles as follows: 269 circuit miles of 500 kV line; 413 circuit miles of 230 kV line; and 573 miles of 115 kV line. The Company also has 28,481 circuit miles of distribution lines that deliver electricity to its customers.
As of December 31, 2023, PGE-owned electric transmission system consisted of 1,254 circuit miles as follows: 287 circuit miles of 500 kV line; 413 circuit miles of 230 kV line; and 554 miles of 115 kV line. The Company also has 28,868 circuit miles of distribution lines that deliver electricity to its customers.
The licenses for the hydroelectric projects on the three different rivers expire as follows: Clackamas River, 2055; Willamette River, 2035; and Deschutes River, 2055. Transmission and Distribution PGE owns or has contractual rights associated with transmission lines that deliver electricity from its generation facilities to its distribution system in its service territory and also to the Western Interconnection.
This additional wind capacity is not reflected in the table above. 37 Table of Contents Transmission and Distribution PGE owns or has contractual rights associated with transmission lines that deliver electricity from its generation facilities to its distribution system in its service territory and also to the Western Interconnection.
Removed
The Indenture securing the Company’s First Mortgage Bonds (FMBs) constitutes a direct first mortgage lien on substantially all utility property and franchises, other than expressly excepted property.
Added
(3) Represents nameplate ratings. A generator’s nameplate rating is its full-load capacity under normal operating conditions as defined by the manufacturer. (4) Represents most favorable operating conditions which refers to the set of optimal circumstances under which a power plant or energy generation system can achieve its maximum output capacity efficiently and reliably.
Removed
For wind-powered generating facilities, nameplate ratings are used in place of net capacity. A generator’s nameplate rating is its full-load capacity under normal operating conditions as defined by the manufacturer. (2) Net capacity reflects PGE’s ownership share. (3) PGE has a 20% ownership interest in the facility, which is operated by Talen Montana, LLC.
Added
(5) PGE has a 20% ownership interest in the facility, which is operated by Talen Montana, LLC. (6) PGE has a 50.01% ownership interest in the Pelton/Round Butte hydroelectric project. PGE’s hydroelectric projects are operated pursuant to FERC licenses issued under the FPA.
Removed
The Company operated, and continues to have a 90% ownership interest in Boardman, which ceased coal-fired operations during the fourth quarter of 2020.
Added
The licenses for the hydroelectric projects on the three different rivers expire as follows: Clackamas River, 2055; Willamette River, 2035; and Deschutes River, 2055.
Removed
For additional information on Colstrip as it relates to environmental laws and regulations in the State, see “RPS standards and other laws” in the Overview section in Item 7.—“Management’s Discussion and Analysis of Financial Condition and Results of Operations” and Note 19, Contingencies, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” (4) Effective January 1, 2022, PGE sold 16.66% interest to CTWS, resulting in PGE’s 50.01% ownership interest. 32 Table of Contents PGE’s hydroelectric projects are operated pursuant to FERC licenses issued under the FPA.
Added
PGE and NextEra Energy Resources, LLC, a subsidiary of NextEra Energy, Inc. have entered into agreements to construct a 311 MW wind energy facility, which will be part of the larger Clearwater Wind development in Eastern Montana. Substantial completion of the project was achieved on January 5, 2024. PGE will own 208 MW of production capacity in these agreements.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+0 added−2 removed1 unchanged
Biggest changeFor information with respect to securities authorized for issuance under equity-based plans, see Note 13, Equity-based Plans and Note 14, Stock-Based Compensation in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Share repurchase program On February 11, 2022, the Company’s Board of Directors authorized a share repurchase program, replacing and superseding the program previously authorized on February 17, 2021, which allowed the Company to repurchase up to 350,000 shares of its outstanding common stock through 2022 at a maximum share price of $60, resulting in maximum aggregate purchase price of $21 million.
Biggest changeFor information with respect to securities authorized for issuance under equity-based plans, see Note 13, Equity-based Plans and Note 14, Stock-Based Compensation in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” ITEM 6. [RESERVED]
The amount of any dividend declaration will depend upon factors that the Board of Directors deems relevant and may include, but are not limited to, PGE’s results of operations and financial condition, future capital expenditures and investments, and applicable regulatory and contractual restrictions.
The amount of any dividend declaration will depend upon factors that the Board of Directors deems relevant and may include, but are not limited to, PGE’s 38 Table of Contents results of operations and financial condition, future capital expenditures and investments, and applicable regulatory and contractual restrictions.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. PGE’s common stock is traded on the NYSE under the ticker symbol “POR”. As of February 8, 2023, there were 748 holders of record of PGE’s common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES. PGE’s common stock is traded on the NYSE under the ticker symbol “POR”. As of February 8, 2024, there were 694 holders of record of PGE’s common stock.
Removed
As of December 31, 2022, the Company had repurchased 350,000 shares at an average price of $51.61 per share for a total cost of $18.1 million under this program. All share repurchases were made under PGE's publicly announced program and there were no other programs under which the Company repurchased shares.
Removed
PGE did not repurchase any shares of its common stock during the three-month period ended December 31, 2022. ITEM 6. [RESERVED]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

157 edited+82 added−119 removed56 unchanged
Biggest changeGeneration, transmission, and distribution expense increased $38 million or 12% for the year ended December 31, 2022 compared to the year ended December 31, 2021, with the change attributed largely to the following items (in millions): Year ended December 31, 2021 $ 310 Release of previously deferred amounts pursuant to earnings test created in OPUC 2022 GRC Order 16 Higher service restoration and storm response costs 5 Higher distribution vegetation management, inspection, and maintenance expenses 4 Higher employee compensation and benefits expenses 4 Increase in generation facility maintenance expenses driven by major maintenance activities 3 Miscellaneous expenses 6 Year ended December 31, 2022 348 Change in Generation, transmission and distribution $ 38 For the year ended December 31, 2022, PGE deferred $27 million and $7 million in incremental wildfire mitigation costs and storm response costs, respectively. 58 Table of Contents Administrative and other expense increased $4 million or 1% for the year ended December 31, 2022 compared to the year ended December 31, 2021 due largely to the following items (in millions): Year ended December 31, 2021 $ 336 Regulatory program amortization 6 Higher facility maintenance, insurance, and licensing expenses 4 Higher bad debt expense 1 Lower professional service expenses (5) Lower employee compensation and benefits expenses (5) Miscellaneous expenses 3 Year ended December 31, 2022 340 Change in Administrative and other $ 4 Depreciation and amortization expense increased $13 million or 3% for the year ended December 31, 2022 compared to year ended December 31, 2021, with the change largely resulting from the following items (in millions): Year ended December 31, 2021 $ 404 Accelerated depreciation of the Colstrip facility as approved by the OPUC’s 2022 GRC Order 15 Capital additions, net of retirements 8 Activity related to regulatory programs (offset elsewhere on the income statement) (10) Year ended December 31, 2022 417 Change in Depreciation and amortization $ 13 Taxes other than income taxes expense increased $11 million, or 8%, in 2022 compared with 2021, primarily due to higher franchise fees and property tax expenses.
Biggest changeThe following items contributed to the increase in Actual NVPC for the year ended December 31, 2023 compared to the year ended December 31, 2022 (in millions): Year ended December 31, 2022 $ 626 Purchased power and fuel expense 187 Wholesale revenues (55) 2021 PCAM deferral amortization 15 Year ended December 31, 2023 773 Change in NVPC $ 147 For further information regarding NVPC in relation to the PCAM, see “Power operations” in the Overview section of this Item 7. 60 Table of Contents Generation, transmission and distribution expense increased $26 million or 7% for the year ended December 31, 2023 compared to the year ended December 31, 2022, with the change attributed largely to the following items (in millions): Year ended December 31, 2022 $ 348 Amortizations of previously deferred 2020 wildfire and 2021 ice storm costs 18 Higher vegetation management, inspection, wildfire mitigation, and distribution maintenance expenses 15 Increase in generation facility maintenance expenses driven by major maintenance activities and increased run hours 13 Lower service restoration and storm response costs (7) Release of deferred amounts pursuant to earnings test in 2022 (16) Miscellaneous expenses 3 Year ended December 31, 2023 374 Change in Generation, transmission and distribution $ 26 Administrative and other expense increased $1 million for the year ended December 31, 2023 compared to the year ended December 31, 2022 due largely to the following items (in millions): Year ended December 31, 2022 $ 340 Amortization of COVID-19 bad debt expense deferral 9 Regulatory program amortization 3 Lower employee compensation and benefits expenses (4) Lower professional service expenses (8) Miscellaneous expenses 1 Year ended December 31, 2023 341 Change in Administrative and other $ 1 PGE commenced amortization of previously deferred COVID-19 related bad debt expenses on April 1, 2023.
Such forward-looking statements include, but are not limited to, statements that relate to expectations, beliefs, plans, assumptions and objectives concerning future results of operations, business prospects, loads, outcome of litigation and regulatory proceedings, capital expenditures, market conditions, future events or performance, and other matters.
Such forward-looking statements include, but are not limited to, statements that relate to expectations, beliefs, plans, assumptions and objectives concerning future results of operations, business prospects, loads, outcome of litigation and regulatory proceedings, capital expenditures, market conditions, events or performance, and other matters.
Compared to previous resource planning processes, the Company believes the new tax incentives will provide additional investment opportunities for PGE and result in lower customer prices. Increased capital expenditures in such investment would likely result in additional financing needs through debt and equity instruments.
Compared to previous resource planning processes, the Company believes the new tax incentives will provide additional investment opportunities for PGE and result in lower customer prices. Increased capital expenditures in such investment opportunities would likely result in additional financing needs through debt and equity instruments.
The baseline levels for PGE are the average annual emissions for the years 2010, 2011, and 2012 associated with the electricity sold to its retail electricity consumers as reported to the Oregon Department of Environmental Quality (ODEQ).
For PGE, the baseline levels are the average annual emissions for the years 2010, 2011, and 2012 associated with the electricity sold to its retail electricity consumers as reported to the Oregon Department of Environmental Quality (ODEQ).
For additional information regarding contractual obligations, see Note 16, Commitments and Guarantees, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Cash Flows from Investing Activities —Cash flows used in investing activities consist primarily of capital expenditures related to new construction and improvements to PGE’s distribution, transmission, and generation facilities.
For additional information regarding contractual obligations, see Note 16, Commitments and Guarantees, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Cash Flows from Investing Activities —Cash flows used in investing activities consist primarily of capital expenditures related to new construction and improvements to PGE’s generation, transmission, and distribution facilities.
For additional information on the EFSA, see Note 12, Equity-based Plans, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Capital Structure —PGE’s financial objectives include maintaining a common equity ratio (common equity to total consolidated capitalization, including current debt maturities and excluding lease obligations) of approximately 50% over time.
For additional information on the EFSA, see Note 13, Equity-based Plans, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Capital Structure —PGE’s financial objectives include maintaining a common equity ratio (common equity to total consolidated capitalization, including current debt maturities and excluding lease obligations) of approximately 50% over time.
The maximum retail load allowed to be supplied under the fixed three-year and minimum five-year opt-out programs represent 12% of the Company’s total retail energy deliveries for 2022. With the adoption of the New Large Load Direct Access program in 2020, as much as 17% of the Company’s 2022 energy deliveries could have been supplied by ESSs.
The maximum retail load allowed to be supplied under the fixed three-year and minimum five-year opt-out programs represent 12% of the Company’s total retail energy deliveries for 2023. With the adoption of the New Large Load Direct Access program in 2020, as much as 17% of the Company’s 2023 energy deliveries could have been supplied by ESSs.
Any reduction in generation from Colstrip has the potential to provide capacity on the Colstrip transmission facilities, which stretch from eastern Montana to near the western end of that state to serve markets in the Pacific Northwest and neighboring states. PGE has an approximate 15% ownership interest in, and capacity on, the Colstrip transmission facilities.
Any reduction in generation from Colstrip has the potential to provide additional capacity availability on the Colstrip transmission facilities, which stretch from eastern Montana to near the western end of that state to serve markets in the Pacific Northwest and neighboring states. PGE has an approximate 15% ownership interest in, and capacity on, the Colstrip transmission facilities.
To create a clean energy future, PGE is focused on the following strategic initiatives: • Decarbonize Power —Reduce greenhouse gas emissions associated with electricity served to retail customers by at least 80% by 2030 and 100% by 2040; • Electrify the Economy —Increase beneficial electricity use to capture the benefits of new technologies while building an increasingly clean, flexible and reliable grid; and • Advance our Performance —Improve efficiency, safety, and system and equipment reliability while maintaining affordable energy service and growing earnings per share 5% to 7% annually.
To create a clean energy future, PGE is focused on the following strategic imperatives: • Decarbonize Power —Reduce greenhouse gas (GHG) emissions associated with electricity served to retail customers by at least 80% by 2030 and 100% by 2040; • Electrify the Economy —Increase beneficial electricity use to capture the benefits of new technologies while building an increasingly clean, flexible and reliable grid; and • Advance Performance —Improve safety, efficiency, and system and equipment reliability while maintaining affordable energy service and growing earnings per share 5% to 7% annually.
Empowering customers and communities —PGE’s customers have a desire for purchasing clean energy, as over 234 thousand residential and small commercial customers voluntarily participate in PGE’s Green Future Program, the largest renewable power program by participation in the nation.
Empowering customers and communities —PGE’s customers have a desire for purchasing clean energy, as over 233 thousand residential and small commercial customers voluntarily participate in PGE’s Green Future Program, the largest renewable power program by participation in the nation.
The following table presents the number of heating and cooling degree-days in 2022 and 2021, along with the current 15-year averages, reflecting the influence that weather had on comparative energy deliveries.
The following table presents the number of heating and cooling degree-days in 2023 and 2022, along with the current 15-year averages, reflecting the influence that weather had on comparative energy deliveries.
PGE has taken measures to help ensure the availability of supply chain-constrained items that are needed to serve new and existing customers, such as advance ordering of critical materials, pre-securing manufacturing capacity with strategic partners, and evaluating availability with established and new suppliers.
PGE has taken measures to enhance the availability of supply chain-constrained items that are needed to serve new and existing customers, such as advance ordering of critical materials, pre-securing manufacturing capacity with strategic partners, and evaluating availability with established and new suppliers.
HB 2021 —In June 2021, the Oregon Legislature passed HB 2021, which requires retail electricity providers to reduce GHG emissions associated with serving Oregon retail electricity consumers 80% by 2030, 90% by 2035, and 100% by 2040, compared to their baseline emissions levels.
HB 2021 —In June 2021, the Oregon Legislature passed HB 2021, which, among other things, requires retail electricity providers to reduce GHG emissions associated with serving Oregon retail electricity consumers 80% by 2030, 90% by 2035, and 100% by 2040, compared to their baseline emissions levels.
In 2022, PGE began to see decreases in average residential usage on a weather-adjusted, year over year basis, however we expect that the shift that has occurred with respect to hybrid work schedules will have lasting impacts on average usage.
In 2022, PGE began to see decreases in average residential usage on a weather-adjusted, year over year basis, however expects that the shift that has occurred with respect to hybrid work schedules will have lasting impacts on average usage.
PGE’s expectations, beliefs and projections are expressed in good faith and are believed by the Company to have a reasonable basis including, but not limited to, management’s examination of historical operating trends and data contained either in internal records or available from third parties, but there can be no assurance that PGE’s expectations, beliefs, or projections will be achieved or accomplished. 34 Table of Contents In addition to any assumptions and other factors and matters referred to specifically in connection with forward-looking statements, factors that could cause actual results or outcomes for PGE to differ materially from those discussed in such forward-looking statements include: • governmental policies, legislative action, and regulatory audits, investigations and actions, including those of the FERC, the OPUC, the SEC, and the Division of Enforcement of the Commodity Futures Trading Commission (CFTC) with respect to allowed rates of return, financings, electricity pricing and price structures, acquisition and disposal of facilities and other assets, construction and operation of plant facilities, transmission of electricity, recovery of power costs, operating expenses, deferrals, timely recovery of costs, and capital investments, energy trading activities, and current or prospective wholesale and retail competition; • economic conditions that result in decreased demand for electricity, reduced revenue from sales of excess energy during periods of low wholesale market prices, impaired financial stability of vendors and service providers and elevated levels of uncollectible customer accounts; • inflation and interest rates; • changing customer expectations and choices that may reduce customer demand for its services may impact PGE’s ability to make and recover its investments through rates and earn its authorized return on equity, including the impact of growing distributed and renewable generation resources, changing customer demand for enhanced electric services, and an increasing risk that customers procure electricity from registered ESSs or the adoption of community choice aggregation; • the timing or outcome of legal and regulatory proceedings and issues including, but not limited to, the matters described in Regulatory Matters of the “Overview” in this Item 7. and Note 19, Contingencies in the Notes to Consolidated Financial Statements in Item 8.— “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K; • natural or human-caused disasters and other risks, including, but not limited to, earthquake, flood, ice, drought, extreme heat, lightning, wind, fire, accidents, equipment failure, acts of terrorism, computer system outages and other events that disrupt PGE operations, damage PGE facilities and systems, cause the release of harmful materials, cause fires, and subject the Company to liability; • unseasonable or severe weather and other natural phenomena, such as the greater size and prevalence of wildfires in Oregon in recent years, which could affect public safety, customers’ demand for power and PGE’s ability and cost to procure adequate power and fuel supplies to serve its customers, PGE’s ability to access the wholesale energy market, PGE’s ability to operate its generating facilities and transmission and distribution systems, the Company’s costs to maintain, repair, and replace such facilities and systems, and recovery of costs; • PGE’s ability to effectively implement a PSPS and de-energize its system in the event of heightened wildfire risk, which could lead to potential liability if energized systems are involved in wildfires that cause harm; • operational factors affecting PGE’s power generating facilities and battery storage facilities, including forced outages, unscheduled delays, hydro and wind conditions, and disruption of fuel supply, any of which may cause the Company to incur repair costs or purchase replacement power at increased costs; • default or nonperformance on the part of any parties from whom PGE purchases capacity or energy, which may cause the Company to incur costs to purchase replacement power and related renewable attributes at increased costs; • complications arising from PGE’s jointly-owned plant, including changes in ownership, adverse regulatory outcomes or legislative actions, or operational failures that result in legal or environmental liabilities or unanticipated costs related to replacement power or repair costs; • delays in the supply chain and increased supply costs, failure to complete capital projects on schedule or within budget, failure of counterparties to perform under agreements, or the abandonment of capital 35 Table of Contents projects, any of which could result in the Company’s inability to recover project costs, or impact PGE’s competitive position, market share, or results of operations in a material way; • volatility in wholesale power and natural gas prices, including but not limited to volatility caused by macroeconomic and international issues, that could require PGE to post additional collateral or issue additional letters of credit pursuant to power and natural gas purchase agreements; • changes in the availability and price of wholesale power and fuels, including natural gas and coal, and the impact of such changes on the Company’s power costs; • capital market conditions, including availability of capital, volatility of interest rates, reductions in demand for investment-grade commercial paper, volatility of equity markets as well as changes in PGE’s credit ratings, any of which could have an impact on the Company’s cost of capital and its ability to access the capital markets to support requirements for working capital, construction of capital projects, the repayments of maturing debt, and stock-based compensation plans, which are relied upon in part to retain key executives and employees; • future laws, regulations, and proceedings that could increase the Company’s costs of operating its thermal generating plants, or affect the operations of such plants by imposing requirements for additional emissions controls or significant emissions fees or taxes, particularly with respect to coal-fired generating facilities, in order to mitigate carbon dioxide, mercury, and other gas emissions; • changes in, and compliance with, environmental laws and policies, including those related to threatened and endangered species, fish, and wildlife; • the effects of climate change, whether global or local in nature, including unseasonable or extreme weather and other natural phenomena that may affect energy costs or consumption, increase the Company’s costs, cause damage to PGE facilities and system, or adversely affect its operations; • changes in residential, commercial, or industrial customer growth, or demographic patterns, in PGE’s service territory; • the effectiveness of PGE’s risk management policies and procedures; • cybersecurity attacks, data security breaches, physical attacks and security breaches, or other malicious acts that cause damage to the Company’s generation, transmission, or distribution facilities, information technology systems, inhibit the capability of equipment or systems to function as designed or expected, or result in the release of confidential customer, vendor, employee, or Company information; • employee workforce factors, including potential strikes, work stoppages, transitions in senior management, the ability to recruit and retain key employees and other talent, and turnover due to macroeconomic trends such as voluntary resignation of large numbers of employees similar to that experienced by other employers and industries since the beginning of the COVID-19 pandemic; • new federal, state, and local laws that could have adverse effects on operating results; • failure to achieve the Company’s greenhouse gas emission goals or being perceived to have either failed to act responsibly with respect to the environment or effectively respond to legislative requirements concerning greenhouse gas emission reductions, any of which could lead to adverse publicity and have adverse effects on the Company's operations and/or damage the Company's reputation; • political and economic conditions; • the impact of widespread health developments, including the global COVID–19 pandemic, and responses to such developments (such as voluntary and mandatory quarantines, including government stay at home orders, as well as shut downs and other restrictions on travel, commercial, social, and other activities), which could materially and adversely affect, among other things, demand for electric services, customers’ ability to pay, supply chains, personnel, contract counterparties, liquidity and financial markets; • changes in financial or regulatory accounting principles or policies imposed by governing bodies; 36 Table of Contents • risks and uncertainties related to 2021 All-Source RFP final shortlist projects, including, but not limited to regulatory processes, inflationary impacts, supply chain constraints, supply cost increases (including application of tariffs impacting solar module imports), and legislative uncertainty; and • acts of war or terrorism.
In addition to any assumptions and other factors and matters referred to specifically in connection with forward-looking statements, factors that could cause actual results or outcomes for PGE to differ materially from those discussed in such forward-looking statements include: • governmental policies, legislative action, and regulatory audits, investigations and actions, including those of the FERC, the OPUC, the SEC, and the Division of Enforcement of the Commodity Futures Trading Commission (CFTC) with respect to allowed rates of return, financings, electricity pricing and price structures, acquisition and disposal of facilities and other assets, construction and operation of plant facilities, transmission of electricity, recovery of power costs, operating expenses, deferrals, timely recovery of costs, and capital investments, energy trading activities, and current or prospective wholesale and retail competition; • economic conditions that result in decreased demand for electricity, reduced revenue from sales of excess energy during periods of low wholesale market prices, impaired financial stability of vendors and service providers and elevated levels of uncollectible customer accounts; • inflation and volatility in interest rates; • changing customer expectations and choices that may reduce customer demand for PGE’s services may impact the Company’s ability to make and recover its investments through rates and earn its authorized return on equity, including the impact of growing distributed and renewable generation resources, changing customer demand for enhanced electric services, and an increasing risk that customers procure electricity from registered ESSs or the adoption of community choice aggregation; • the timing or outcome of legal and regulatory proceedings and issues including, but not limited to, the matters described in Regulatory Matters of the “Overview” in this Item 7. and Note 19, Contingencies in the 39 Table of Contents Notes to Consolidated Financial Statements in Item 8.— “Financial Statements and Supplementary Data” of this Annual Report on Form 10-K; • natural or human-caused disasters and other risks, including, but not limited to, earthquake, flood, ice, drought, extreme heat, lightning, wind, fire, accidents, equipment failure, acts of terrorism, computer system outages and other events that disrupt PGE operations, damage PGE facilities and systems, cause the release of harmful materials, cause fires, and subject the Company to liability; • unseasonable or severe weather and other natural phenomena, such as the greater size and prevalence of wildfires in Oregon in recent years, which could affect public safety, customers’ demand for power and PGE’s ability and cost to procure adequate power and fuel supplies to serve its customers, access the wholesale energy market, or operate its generating facilities and transmission and distribution systems, and the Company’s costs to maintain, repair, and replace such facilities and systems, and recovery of costs; • PGE’s ability to effectively implement a PSPS and de-energize its system in the event of heightened wildfire risk or implement effective system hardening programs, the inability of which could lead to potential liability if energized systems are involved in wildfires that cause harm, as well as the risk that damages from wildfires may not be recoverable through rates or insurance, resulting in impact to the financial condition or reputation of the Company; • operational factors affecting PGE’s power generating facilities and battery storage facilities, including forced outages, fires, unscheduled delays, hydro and wind conditions, and disruption of fuel supply, any of which may cause the Company to incur repair costs or purchase replacement power at increased costs; • default or nonperformance on the part of any parties from whom PGE purchases fuel, capacity, or energy, which may cause the Company to incur costs to purchase replacement power and related renewable attributes at increased costs; • complications arising from PGE’s jointly-owned plant, including changes in ownership, adverse regulatory outcomes or legislative actions, or operational failures that result in legal or environmental liabilities or unanticipated costs related to replacement power or repair costs; • delays in the supply chain and increased supply costs, failure to complete capital projects on schedule or within budget, inability to complete negotiations on contracts for capital projects, failure of counterparties to perform under agreements, or the abandonment of capital projects, any of which could result in the Company’s inability to recover project costs, or impact PGE’s competitive position, market share, or results of operations in a material way; • volatility in wholesale power and natural gas prices, including but not limited to volatility caused by macroeconomic and international issues, that could require PGE to post additional collateral or issue additional letters of credit pursuant to power and natural gas purchase agreements; • changes in the availability and price of wholesale power and fuels, including natural gas and coal, and the impact of such changes on the Company’s power costs; • capital market conditions, including availability of capital, volatility of interest rates, reductions in demand for investment-grade commercial paper, volatility of equity markets as well as changes in PGE’s credit ratings, any of which could have an impact on the Company’s cost of capital and its ability to access the capital markets to support requirements for working capital, construction of capital projects, the repayments of maturing debt, and stock-based compensation plans, which are relied upon in part to retain key executives and employees; • future laws, regulations, and proceedings that could increase the Company’s costs of operating its thermal generating plants, or affect the operations of such plants by imposing requirements for additional emissions controls or significant emissions fees or taxes, particularly with respect to coal-fired generating facilities, in order to mitigate carbon dioxide, mercury, and other gas emissions; • changes in, and compliance with, environmental laws and policies, including those related to threatened and endangered species, fish, and wildlife; 40 Table of Contents • the effects of climate change, whether global or local in nature, including unseasonable or extreme weather and other natural phenomena that may affect energy costs or consumption, increase the Company’s costs, cause damage to PGE facilities and system, or adversely affect its operations; • changes in residential, commercial, or industrial customer growth, or demographic patterns, including changes in load resulting in future transmission constraints, in PGE’s service territory; • the effectiveness of PGE’s risk management policies and procedures; • cybersecurity attacks, data security breaches, physical attacks and security breaches, or other malicious acts that cause damage to the Company’s generation, transmission, or distribution facilities, information technology systems, inhibit the capability of equipment or systems to function as designed or expected, or result in the release of confidential customer, vendor, employee, or Company information; • employee workforce factors, including potential strikes, work stoppages, transitions in senior management, the ability to recruit and retain key employees and other talent, and turnover due to macroeconomic trends such as voluntary resignation of large numbers of employees similar to that experienced by other employers and industries since the beginning of the COVID-19 pandemic; • new federal, state, and local laws that could have adverse effects on operating results; • failure to achieve the Company’s greenhouse gas emission goals or being perceived to have either failed to act responsibly with respect to the environment or effectively respond to legislative requirements concerning greenhouse gas emission reductions, any of which could lead to adverse publicity and have adverse effects on the Company's operations and/or damage the Company's reputation; • social attitudes regarding the electric utility and power industries; • political and economic conditions; • the impact of widespread health developments, and responses to such developments (such as voluntary and mandatory quarantines, including government stay at home orders, as well as shut downs and other restrictions on travel, commercial, social, and other activities), which could materially and adversely affect, among other things, demand for electric services, customers’ ability to pay, supply chains, personnel, contract counterparties, liquidity and financial markets; • changes in financial or regulatory accounting principles or policies imposed by governing bodies; • risks and uncertainties related to current or future All-Source RFP projects, including, but not limited to regulatory processes, transmission capabilities, system interconnections, inflationary impacts, supply chain constraints, supply cost increases (including application of tariffs impacting solar module imports), permitting and construction delays, and legislative uncertainty; and • acts of war or terrorism.
As of December 31, 2022, significant uncertainties still remained concerning the precise boundaries for clean-up, the assignment of responsibility for clean-up costs, the final selection of a proposed remedy by the EPA, and the method of allocation of costs amongst PRPs. It is probable that PGE will share in a portion of these costs.
As of December 31, 2023, significant uncertainties still remained concerning the precise requirements for clean-up, the assignment of responsibility for clean-up costs, the final selection of a proposed remedy by the EPA, and the method of allocation of costs amongst PRPs. It is probable that PGE will share in a portion of these costs.
The performance assurance collateral can be in the form of cash deposits or letters of credit, depending on the terms of the underlying agreements, and are 62 Table of Contents based on the contract terms and commodity prices and can vary from period to period.
The performance assurance collateral can be in the form of cash deposits or letters of credit, depending on the terms of the underlying agreements, and are based on the contract terms and commodity prices and can vary from period to period.
PGE is engaged with customers and communities to develop infrastructure projects aimed at improving accessibility to electric vehicle charging stations, build fleet partnerships, and offer programs to encourage customers to advance transportation electrification.
PGE is engaged with customers and communities to manage electric vehicle (EV) charging load, develop infrastructure projects aimed at improving accessibility to electric vehicle charging stations, build fleet partnerships, and offer programs to encourage customers to advance transportation electrification.
PGE typically classifies borrowings under the revolving credit facility and outstanding commercial paper as Short-term debt in the consolidated balance sheets. Under the revolving credit facility, as of December 31, 2022, PGE had no borrowings or commercial paper outstanding, and no letters of credit issued.
PGE typically classifies borrowings under the revolving credit facility and outstanding commercial paper as Short-term debt in the consolidated balance sheets. Under the revolving credit facility, as of December 31, 2023, PGE had no borrowings, and no letters of credit issued.
The following is a summary of the results of the Company’s PCAM as calculated for regulatory purposes for 2022 and 2021: • For 2022, actual NVPC was above baseline NVPC by $23 million, which was within the established deadband range. Accordingly, no estimated collection from customers was recorded as of December 31, 2022.
The following is a summary of the results of the Company’s PCAM as calculated for regulatory purposes for 2023 and 2022: • For 2023, actual NVPC was above baseline NVPC by $5 million, which was within the established deadband range. Accordingly, no estimated collection from customers was recorded as of December 31, 2023.
PGE’s credit facilities contain customary covenants and credit provisions, including a requirement that limits consolidated indebtedness, as defined in the credit agreements, to 65.0% of total capitalization (debt to total capital ratio). As of December 31, 2022, the Company’s debt to total capital ratio, as calculated under the credit agreements, was 56.9%.
PGE’s credit facilities contain customary covenants and credit provisions, including a requirement that limits consolidated indebtedness, as defined in the credit agreements, to 65.0% of total capitalization (debt to total capital ratio). As of December 31, 2023, the Company’s debt to total capital ratio, as calculated under the credit agreements, was 56.2%.
The OPUC maintains responsibility to review utility requests to amortize deferred amounts in customer prices, including a review of utility prudence in a future proceeding, among other requirements. As of December 31, 2022, PGE has not recorded any costs under this deferral order.
The OPUC maintains responsibility to review utility requests to amortize deferred amounts in customer prices, including a review of utility prudence in a future proceeding, among other requirements. As of December 31, 2023, PGE had not recorded any costs under this deferral order.
Deferral of Boardman revenue requirement — In October 2020, intervenors filed a deferral application with the OPUC that would require PGE to defer and refund the revenue requirement associated with the Company’s Boardman coal-fired generating plant (Boardman) then included in customer prices as established in the Company’s 2019 GRC.
Deferral of Boardman revenue requirement — In 2020, intervenors filed a deferral application with the OPUC that would have required PGE to defer and refund the revenue requirement associated with the Company’s Boardman coal-fired generating plant (Boardman) then included in customer prices as established in the Company’s 2019 GRC.
As approved by the OPUC, the 2022 AUT included a final increase in power costs for 2022, and a corresponding increase in annual revenue requirement, of $64 million from 2021 levels, which were reflected in customer prices effective January 1, 2022.
As approved by the OPUC, the 2023 AUT included a final increase in power costs for 2023, and a corresponding increase in annual revenue requirement of $186 million from 2022 levels, which were reflected in customer prices effective January 1, 2023.
As approved by the OPUC, the Company’s recovery mechanism allows the Company to defer and recover estimated liabilities and incurred environmental expenditures related to the Portland Harbor Superfund Site through a combination of third-party proceeds, including, but not limited to, insurance recoveries, and customer prices, as necessary.
As approved by the OPUC, the recovery mechanism allows the Company to defer and recover estimated liabilities and incurred legal and technical analysis expenditures related to the Portland Harbor Superfund Site through a combination of third-party proceeds, including, but not limited to, insurance recoveries, and customer prices, as necessary.
PGE cannot predict the outcome of these proceedings or potential impact, if any, to its ongoing 2021 All-Source RFP process. 2023 All-Source RFP PGE filed notice with the OPUC on January 31, 2023 that an RFP in 2023 is needed to procure resources to meet a forecasted 2026 capacity shortfall and to make continued progress toward HB 2021’s decarbonization targets.
PGE cannot predict the outcome of these proceedings or potential impact, if any, to its ongoing 2021 All-Source RFP process. 44 Table of Contents 2023 All-Source RFP PGE filed notice with the OPUC on January 31, 2023 that an RFP in 2023 was needed to procure resources to meet a forecasted 2026 capacity shortfall and to make continued progress toward decarbonization targets under HB 2021.
The increase was driven by a 10.6% growth in industrial deliveries, partially offset by a 0.5% decline in commercial energy deliveries and a 1.4% decrease in weather-adjusted deliveries to residential customers, as average use per customer has declined from the highs seen during the first two years of the COVID-19 pandemic.
The increase was driven by a 5.9% growth in industrial deliveries, partially offset by a 0.2% decline in commercial energy deliveries and a 0.5% decrease in weather-adjusted deliveries to residential customers, as average use per customer has declined from the highs seen during the first two years of the COVID-19 pandemic.
PGE estimates that on December 31, 2022, under the most restrictive issuance test in the Indenture of Mortgage and Deed of Trust, the Company could have issued up to $599 million of additional FMBs.
PGE estimates that on December 31, 2023, under the most restrictive issuance test in the Indenture of Mortgage and Deed of Trust, the Company could have issued up to $602 million of additional FMBs.
Short-term Debt —Pursuant to an order issued by the FERC on January 20, 2022, PGE has authorization to issue short-term debt up to a total of $900 million through February 6, 2024.
Short-term Debt —Pursuant to an order issued by the FERC on January 18, 2024, PGE has authorization to issue short-term debt up to a total of $900 million through February 6, 2026.
NewSun also filed a motion to stay the 2021 All-Source RFP process, which the Court subsequently denied. The OPUC filed a motion to dismiss the case and PGE joined the OPUC’s motion to dismiss. NewSun opposed the motion.
PGE joined in the case as an intervenor. NewSun also filed a motion to stay the 2021 All-Source RFP process, which the Court subsequently denied. The OPUC filed a motion to dismiss the case and PGE joined the OPUC’s motion to dismiss. NewSun opposed the motion.
The Company has elected to limit its borrowings under the revolving credit facility to cover any potential need to repay commercial paper that may be outstanding at the time. As of December 31, 2022, PGE had no commercial paper outstanding.
The Company has elected to limit its borrowings under the revolving credit facility to cover any potential need to repay commercial paper that may be outstanding at the time. As of December 31, 2023, PGE had $146 million of commercial paper outstanding.
PGE’s deferral application was approved by the OPUC in October 2020 with final stipulations for the Term Sheet approved in November 2020. As of December 31, 2022 and December 31, 2021, PGE’s deferred balance was $22 million and $36 million, respectively, comprised primarily of bad debt expense in excess of what is currently considered and collected in customer prices.
PGE’s deferral application was approved by the OPUC in October 2020 with final stipulations for the Term Sheet approved in November 2020. As of December 31, 2023 and December 31, 2022, PGE’s deferred balance was $14 million and $22 million, respectively, comprised primarily of bad debt expense in excess of what was collected in customer prices.
Operating Activities In addition to electricity provided by PGE’s own generation portfolio, to meet retail load requirements and balance energy supply with customer demand, the Company purchases and sells electricity in the wholesale market. PGE also performs portfolio management and wholesale market sales services for third parties in the region.
Operating Activities In addition to electricity provided by PGE’s own generation portfolio, to meet retail load requirements and balance energy supply with customer demand, manage risk, and administer its long-term wholesale contracts, the Company purchases and sells electricity in the wholesale market. PGE also performs portfolio management and wholesale market sales services for third parties in the region.
For additional information on contingencies, see Note 19, Contingencies, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” 66 Table of Contents
For additional information on contingencies, see Note 19, Contingencies, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.”
The following summarizes PGE’s cash flows for the periods presented (in millions): Years Ended December 31, 2022 2021 Cash and cash equivalents, beginning of year $ 52 $ 257 Net cash provided by (used in): Operating activities 674 532 Investing activities (758) (656) Financing activities 197 (81) Net change in cash and cash equivalents 113 (205) Cash and cash equivalents, end of year $ 165 $ 52 2022 Compared to 2021 Cash Flows from Operating Activities —Cash flows from operating activities are generally determined by the amount and timing of cash received from customers and payments made to vendors, as well as the nature and amount of non-cash items, including depreciation and amortization, deferred income taxes, and pension and other postretirement benefit costs included in net income during a given period.
The following summarizes PGE’s cash flows for the periods presented (in millions): Years Ended December 31, 2023 2022 Cash and cash equivalents, beginning of year $ 165 $ 52 Net cash provided by (used in): Operating activities 420 674 Investing activities (1,358) (758) Financing activities 778 197 Net change in cash and cash equivalents (160) 113 Cash and cash equivalents, end of year $ 5 $ 165 2023 Compared to 2022 Cash Flows from Operating Activities —Cash flows from operating activities are generally determined by the amount and timing of cash received from customers and payments made to vendors, as well as the nature and amount of non-cash items, including depreciation and amortization, deferred income taxes, and pension and other postretirement benefit costs included in net income during a given period.
The Company projects that retail energy deliveries for 2023 will be between 2.5% and 3.0% above 2022 weather-adjusted levels, reflecting continued growth in industrial deliveries. 51 Table of Contents ESSs supplied Direct Access customers with energy representing 11% of PGE’s total retail energy deliveries during 2022 and 2021.
The Company projects that retail energy deliveries for 2024 will be between 2% and 3% above 2023 weather-adjusted levels, reflecting continued growth in industrial deliveries. ESSs supplied Direct Access customers with energy representing 11% of PGE’s total retail energy deliveries during 2023 and 2022.
The increase in actual NVPC was also a result of the 41% higher average price per MWh sold and a 1% increase in the volume of wholesale energy deliveries.
The increase in actual NVPC was also a result of the 1% lower average price per MWh sold and a 16% increase in the volume of wholesale energy deliveries.
Based on the Company’s energy portfolio, estimates of energy market prices, and the level of collateral outstanding as of December 31, 2022, the amount of additional collateral that could be requested upon a single agency downgrade to below investment grade is $55 million and decreases to $1 million by December 31, 2023.
Based on the Company’s energy portfolio, estimates of energy market prices, and the level of collateral outstanding as of December 31, 2023, the amount of additional collateral that could be requested upon a single agency downgrade to below investment grade is $76 million and decreases to $60 million by December 31, 2024 and $10 million by December 31, 2025.
Commercial energy deliveries were fairly stable in 2022 with the prior year, showing an increase of 0.1%. While COVID-19 related recovery has largely occurred, continued impacts of programmatic energy efficiency and uncertainty in economic conditions have tempered commercial growth in 2022. Industrial energy deliveries increased 10.9% in 2022 due to continued strength in the high-tech manufacturing and digital service sector.
Commercial energy deliveries were fairly stable in 2023 with the prior year, showing a decrease of 0.3%. While COVID-19 related recovery has largely occurred, continued impacts of programmatic energy efficiency and uncertainty in economic conditions have tempered commercial growth in 2023. Industrial energy deliveries increased 5.9% in 2023 due to continued strength in the high-tech manufacturing and digital service sector.
Cash deposits provided as collateral are classified as Margin deposits in PGE’s consolidated balance sheets, while any letters of credit issued are not reflected in the Company’s consolidated balance sheets. As of December 31, 2022, PGE had posted $149 million of collateral with these counterparties, consisting of $116 million in cash and $33 million in bank letters of credit.
Cash deposits provided as collateral are classified as Margin deposits in PGE’s consolidated balance sheets, while any letters of credit issued are not reflected in the Company’s consolidated balance sheets. As of December 31, 2023, PGE had posted $132 million of collateral with these counterparties, consisting of $92 million in cash and $40 million in bank letters of credit.
These projects target improvements in electrical system reliability and resiliency, wildfire situational awareness and mitigation, greater communications capabilities, advancements in customer usage analytics using artificial intelligence, renewable resources and advanced electrical grid support, hydro generation operations, hydrogen production, and regional transmission capacity constraints. As of 2022, PGE has submitted two full applications.
These projects target improvements in electrical system reliability and resiliency, wildfire situational awareness and mitigation, greater communications capabilities, advancements in customer usage analytics using artificial intelligence, renewable resources and advanced electrical grid support, hydro generation operations, hydrogen production, and regional transmission capacity constraints.
Total cooling degree-days, a similar indication of the extent to which customers were likely to have used electricity for cooling, in 2022, exceeded the 15-year average by 52%, although were only 3% above the 2021 total, illustrating that the two most recent summer seasons have been exceedingly warm compared to historical averages.
Correspondingly, cooling degree-days, a similar indication of the extent to which customers were 53 Table of Contents likely to have used electricity for cooling, exceeded the 15-year average by 50%, although were only 4% above the 2022 total, illustrating that the two most recent summer seasons have been exceedingly warm compared to historical averages.
Other provisions of SB 1547 include: • An increase in RPS thresholds to 27% by 2025, 35% by 2030, 45% by 2035, and 50% by 2040; • A limitation on the life of renewable energy credits (RECs) generated from facilities that become operational after 2022 to five years, but continued unlimited lifespan for all existing RECs and allowance 43 Table of Contents for the generation of additional unlimited RECs for a period of five years for projects online before December 31, 2022; and • An opportunity to pursue recovery of energy storage costs related to renewable energy in the Company’s RAC filings.
Other provisions of SB 1547: • establish RPS thresholds of 27% by 2025, 35% by 2030, 45% by 2035, and 50% by 2040; • limit the life of renewable energy credits (RECs) generated from facilities that become operational after 2022 to five years, but continue unlimited lifespan for all existing RECs and allow for the generation of additional unlimited RECs for a period of five years for projects online before December 31, 2022; and • provide opportunity to pursue recovery of energy storage costs related to renewable energy in the Company’s RAC filings.
(2) P GE has three letter of credit facilities under which the Company can request letters of credit for an original term not to exceed one year. In September 2022, PGE amended its existing revolving credit facility. As of December 31, 2022, PGE had a $650 million unsecured revolving credit facility scheduled to expire in September 2027.
(2) P GE has four letter of credit facilities under which the Company can request letters of credit for an original term not to exceed one year. As of December 31, 2023, PGE had a $750 million unsecured revolving credit facility scheduled to expire in September 2028.
The amount of additional collateral that could be requested upon a dual agency downgrade to below investment grade is $174 million and decreases to $106 million by December 31, 2023 and $74 million by December 31, 2024.
The amount of additional collateral that could be requested upon a dual agency downgrade to below investment grade as of December 31, 2023 is $204 million and decreases to $188 million by December 31, 2024 and $82 million by December 31, 2025.
PGE’s anticipated employer contributions for its defined benefit pension plan and other postretirement plans is $3 million in 2023, $47 million in 2024, $28 million in 2025, $27 million in 2026 and $27 million in 2027. Contributions are expected to be covered by cash provided by operations.
PGE’s anticipated employer contributions for its defined benefit pension plan and other postretirement plans is $29 million in 2024, $24 million in 2025, 2026, and in 2027, and $23 million in 2028. Contributions are expected to be covered by cash provided by operations.
Debt and Equity Financings PGE’s ability to secure sufficient short- and long-term capital at a reasonable cost is determined by its financial performance and outlook, its credit ratings, its capital expenditure requirements, alternatives available to investors, market conditions, and other factors, such as the volatility in the capital markets in response to COVID-19.
Debt and Equity Financings PGE’s ability to secure sufficient short- and long-term capital at a reasonable cost is determined by its financial performance and outlook, credit ratings, capital expenditure requirements, alternatives available to investors, market conditions, and other factors, such as the volatility in the capital markets in response to inflationary pressures and 65 Table of Contents interest rate increases by the federal reserve.
PGE is focused on working with customers, communities, policy makers, and other stakeholders to deliver affordable, safe, reliable electricity service to all, while increasing opportunities to deliver clean and renewable energy, reducing greenhouse gas emissions, and responding to evolving customer expectations.
The Company is committed to being a clean energy leader and delivering steady growth and returns to shareholders. PGE is focused on working with customers, communities, policy makers, and other stakeholders to deliver affordable, safe, reliable electricity service to all, while increasing opportunities to deliver clean and renewable energy, reducing greenhouse gas emissions, and responding to evolving customer expectations.
Discontinued application of regulatory accounting would have a material impact on the Company’s results of operations and financial position. 65 Table of Contents For additional information on PGE’s regulatory assets and liabilities, see “ Regulatory Matters ” in the Overview section in this Item 7., and Note 7, Regulatory Assets and Liabilities in Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Asset Retirement Obligations PGE recognizes AROs for legal obligations related to dismantlement and restoration costs associated with the future retirement of tangible long-lived assets.
For additional information on PGE’s regulatory assets and liabilities, see “ Regulatory Matters ” in the Overview section in this Item 7., and Note 7, Regulatory Assets and Liabilities in Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Asset Retirement Obligations PGE recognizes AROs for legal obligations related to dismantlement and restoration costs associated with the future retirement of tangible long-lived assets.
Cash provided by operations includes the recovery in customer prices of non-cash charges for depreciation and amortization. The Company estimates that such charges in 2023 will range from $445 million to $465 million. 61 Table of Contents Combined with all other sources, cash provided by operations in 2023 is estimated to range from $700 million to $750 million.
Cash provided by operations includes the recovery in customer prices of non-cash charges for depreciation and amortization. The Company estimates that such charges in 2024 will range from $475 million to $525 million. Combined with all other sources, cash provided by operations in 2024 is estimated to range from $700 million to $800 million.
Highlights of PGE’s key investments and plans for building a resilient grid include: • Wildfire Mitigation —PGE’s Wildfire Mitigation & Resiliency organization plans and implements the Wildfire Mitigation Program, developing and coordinating activities across the company.
Highlights of PGE’s key investments and plans for building a resilient grid include: • Wildfire Mitigation —PGE plans and implements a Wildfire Mitigation Program (WMP), developing and coordinating activities across the Company and with state-wide stakeholders.
In addition, sales volumes increased 1%, which contributed another $2 million. 55 Table of Contents Other operating revenues decreased $2 million, or 3%, in 2022 from 2021, primarily as a result of market conditions in 2021 that allowed the Company to sell excess natural gas in excess of amounts needed for the Company’s generation portfolio back into the wholesale market at gains that have exceeded those experienced during 2022.
Other operating revenues decreased $3 million, or 5%, in 2023 from 2022, primarily as a result of market conditions in 2022 that allowed the Company to sell natural gas in excess of amounts needed for the Company’s generation portfolio back into the wholesale market at gains that have exceeded those experienced during 2023.
Pursuant to the GRC Order, the OPUC adopted the agreement such that deferrals will not occur after 2022, although amortization of then previously recorded deferrals will continue as scheduled until collected or refunded in future customer prices and deferral continued through the end of 2022 on a prorated basis.
Pursuant to the 2022 GRC Order, the OPUC adopted the agreement such that deferrals would not occur after 2022, although amortization of then previously recorded deferrals was to continue as scheduled until collected or refunded in future customer prices.
Power operations —PGE utilizes a combination of its own generating resources and wholesale market transactions to meet the energy needs of its retail customers. Based on numerous factors, including plant availability, customer demand, river flows, wind conditions, and current wholesale prices, the Company continuously makes economic dispatch decisions in an effort to obtain reasonably-priced power for its retail customers.
Based on numerous factors, including plant availability, customer demand, river flows, wind conditions, and current wholesale prices, the Company continuously makes economic dispatch decisions in an effort to obtain reasonably-priced power for its retail customers.
Energy expected to be received from wind generating resources is projected annually in the AUT based on historical generation. Wind generation forecasts are developed using a 5-year rolling average of historical wind levels or forecast studies when historical data is not available. Under the PCAM, PGE may share with customers a portion of cost variances associated with NVPC.
Wind generation forecasts are developed using a 5-year rolling average of historical wind levels or forecast studies when historical data is not available. Under the PCAM, PGE may share with customers a portion of cost variances associated with NVPC.
Effective May 9, 2022, PGE’s depreciation rates and associated customer prices changed as approved by the OPUC in the Company’s 2022 General Rate Case (2022 GRC) to reflect further accelerated depreciation of Colstrip Units 3 and 4 from 2030 to December 31, 2025.
Effective May 9, 2022, PGE’s depreciation rates and associated customer prices changed as approved by the OPUC in the Company’s 2022 General Rate Case (GRC) to reflect further accelerated depreciation of Colstrip from 2030 to December 31, 2025. In order to meet PGE’s regulatory and legislative requirements, the Company continues to evaluate the possibility of exiting ownership in Colstrip.
Laws and Regulations Infrastructure Investment and Jobs Act —On November 15, 2021, President Biden signed into law the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA), which includes approximately $550 billion of new federal spending. PGE is pursuing multiple areas under the IIJA for potential grant funding of projects.
Laws and Regulations Federal Grants —In November 2021, the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA), which includes approximately $550 billion of new federal spending, was signed into law. PGE continues to pursue multiple areas under the IIJA, and other state and federal programs, for potential grant funding of projects.
The term loan bears interest for the relevant interest period at the Term Secured Overnight Financing Rate (SOFR) plus Term SOFR Adjustment Rate of 10 basis points and Applicable Margin of 87.5 basis points. The interest rate is subject to adjustment pursuant to the terms of the loan.
The term loan bore interest for the relevant interest period at the Term Secured Overnight Financing Rate (SOFR) plus Term SOFR Adjustment Rate of 10 basis points and Applicable Margin of 87.5 basis points. The interest rate was subject to adjustment pursuant to the terms of the loan. On March 1, 2023, this term loan was repaid in full.
The 2029 and 2033 Bonds were issued in 2022 and funded in full on November 30, 2022 and January 13, 2023, respectively. On October 21, 2022, PGE obtained a 366-day term loan from lenders in the aggregate principal of $260 million under a 366-Day Bridge Credit Agreement.
The first half of FMBs funded in 2022 and the remaining $100 million funded in full on January 13, 2023. On October 21, 2022, PGE obtained a 366-day term loan from lenders in the aggregate principal of $260 million under a 366-Day Bridge Credit Agreement.
These efforts include enhanced tree and brush clearing, replacing equipment, and making emergency plans in close partnership with local, state, and federal land and emergency management agencies to further expand the use of a PSPS, if the need should arise. Pursuant to SB 762, PGE submitted a risk-based wildfire protection plan to the OPUC in December 2022.
These efforts include enhanced tree and brush clearing, hardening equipment, and making emergency plans in close partnership with local, state, and federal land and emergency management agencies to further expand the use of a PSPS, if the need should arise.
The 2023 AUT contains a $186 million increase in NVPC that will be recovered in customer prices beginning January 1, 2023. See “ Power operations ” within this Overview section of Item 7 for more information regarding the PCAM. For 2021, actual NVPC was $62 million above baseline NVPC, which was outside the established deadband range.
The 2024 AUT contains a $216 million increase in NVPC that will be recovered in customer prices beginning January 1, 2024. For more information regarding the PCAM, see “ Power operations ” within this Overview section of Item 7.
PGE cannot predict the ultimate timing and success of securing funding from programs under the IIJA. Inflation Reduction Act of 2022 —The Inflation Reduction Act of 2022 (IRA) was signed into law by President Biden on August 16, 2022 with a majority of the provisions effective for tax years beginning after December 31, 2022.
Although PGE continues to apply for additional grants, the Company cannot predict the ultimate timing and success of securing funding from federal programs. Inflation Reduction Act of 2022 —The Inflation Reduction Act of 2022 (IRA) was signed into law in August 2022 with a majority of the provisions effective for tax years beginning after December 31, 2022.
To achieve this goal the Company must execute effectively within its regulatory framework and maintain prudent management of key financial, regulatory, and environmental matters that may affect customer prices and investor returns. The following discussion provides detail on such matters. General Rate Cases— In July 2021, PGE filed with the OPUC a GRC based on a 2022 test year.
To achieve this goal the Company must execute effectively within its regulatory framework and maintain prudent management of key financial, regulatory, and environmental matters that may affect customer prices and investor returns. The following discussion provides detail on such matters.
Residential energy deliveries, which are most sensitive to fluctuations in temperatures, were 1.4% higher in 2022 than 2021, due to a 0.2% increase in average usage per customer, which resulted largely from warmer summer and colder fourth quarter temperatures, and a 1.1% increase in the average number of customers.
Residential energy deliveries, which are most sensitive to fluctuations in temperatures, were 1.7% lower in 2023 than 2022, due to a 2.5% decrease in average usage per customer, which resulted largely from warmer fourth quarter temperatures, and was partially offset by an 0.8% increase in the average number of customers.
As a co-owner of Colstrip, PGE has provided surety bonds, which are considered off-balance sheet arrangements, of $23 million as of December 31, 2022 on behalf of the operator to ensure the operation and maintenance of remedial and closure actions are carried out related to the Administrative Order on Consent Regarding Impacts Related to Wastewater Facilities Comprising the Closed-Loop System at Colstrip Steam Electric Station, Colstrip Montana (the AOC) as required by the Montana Department of Environmental Quality.
Accumulated asset retirement removal costs that do not qualify as AROs have been reclassified from accumulated depreciation to regulatory liabilities in the consolidated balance sheets. 68 Table of Contents As a co-owner of Colstrip, PGE has provided surety bonds, which are considered off-balance sheet arrangements, of $21 million as of December 31, 2023 on behalf of the operator to ensure the operation and maintenance of remedial and closure actions are carried out related to the Administrative Order on Consent Regarding Impacts Related to Wastewater Facilities Comprising the Closed-Loop System at Colstrip Steam Electric Station, Colstrip Montana (the AOC) as required by the Montana Department of Environmental Quality.
The Company has a 20% ownership share in Colstrip Units 3 and 4 and in response to SB 1547, the Company filed a tariff request in 2016 with the OPUC and received approval to accelerate recovery of PGE’s investment in Colstrip from 2042 to 2030. In 2020, the owners of Colstrip Units 1 and 2 permanently retired those two units.
The Company has a 20% ownership share in Colstrip Units 3 and 4 coal-fired generation plant (Colstrip) and in response to SB 1547, PGE filed a tariff request in 2016 with the OPUC and received approval to accelerate recovery of the Company’s investment in Colstrip from 2042 to 2030.
Plant availability (1) Actual energy provided compared to projected levels (2) Actual energy provided as a percentage of total retail load 2022 2021 2022 2021 2022 2021 Thermal: Natural gas 86 % 89 % 81 % 114 % 41 % 48 % Coal (3) 89 81 100 103 11 11 Wind (4) 82 92 81 110 9 12 Hydro 94 83 81 73 5 6 (1) Plant availability represents the percentage of the year plants were available for operations, which is impacted by planned maintenance and forced, or unplanned, outages.
The following table provides information regarding the performance of the Company’s generation portfolio. 54 Table of Contents Plant availability (1) Actual energy provided compared to projected levels (2) Actual energy provided as a percentage of total retail load 2023 2022 2023 2022 2023 2022 Thermal: Natural gas 85 % 86 % 99 % 81 % 54 % 41 % Coal (3) 90 89 99 100 11 11 Wind (4) 98 82 88 81 9 9 Hydro 89 94 69 81 6 5 (1) Plant availability represents the percentage of the year plants were available for operations, which is impacted by planned maintenance and forced, or unplanned, outages.
Climate Change State-mandated GHG emissions reduction targets —In June 2021, the Oregon legislature passed HB 2021, establishing a 100% clean electricity by 2040 framework for PGE and other investor-owned utilities and electric service suppliers in the State. A number of provisions in the bill align with PGE’s strategic direction, and highlight Oregon’s ambitious, economy-wide goals to combat climate change.
Climate Change State-mandated GHG emissions reduction targets —In June 2021, the Oregon legislature passed House Bill (HB) 2021, establishing a 100% clean electricity by 2040 framework for PGE and other investor-owned utilities and electric service suppliers in the State.
Energy expected to be received from hydroelectric resources is projected annually in the AUT based on a modified hydro study, which utilizes 80 years of historical stream flow data.
Energy expected to be received from hydroelectric resources is projected annually in the AUT based on a modified hydro study, which utilizes 80 years of historical stream flow data. For further detail on regional hydro results, see “Purchased power and fuel” in the Results of Operations section in this Item 7.
In addition, the Company continues to pursue advanced technologies to enhance the grid, pursue distributed generation and energy storage, and develop microgrids and the use of data and analytics to better predict demand and support energy-saving customer programs.
Businesses and families continue to turn to electricity to serve their home and workplace needs. PGE continues to pursue advanced technologies to enhance the grid, pursue distributed generation and energy storage, and develop microgrids and the use of data and analytics to better predict demand and support energy-saving customer programs.
The Company is committed to increase electrification of buildings and support the accelerating pace of vehicle electrification for our customers, as well as our own vehicle fleet. In 2022, PGE completed approximately $11 million in capital projects related to electrifying PGE’s vehicle fleet. Transportation electrification is one of the most significant ways to reduce GHG emissions in Oregon.
The Company is committed to increasing electrification of buildings and supports the accelerating pace of vehicle electrification for our customers, as well as its own vehicle fleet. Transportation electrification is one of the most significant ways to reduce GHG emissions in Oregon.
Previously the Company had to file a request for deferred accounting when an event of that nature occurred, and had to seek OPUC approval of such deferred accounting applications to be effective.
Qualifying events would include federal or state declared emergencies with impacts on PGE’s service territory. Previously the Company had to file a request for deferred accounting when an event of that nature occurred, and had to seek OPUC approval of such deferred accounting applications to be effective.
The mechanism provided for collection from (or refund to) customers if weather-adjusted use per customer was less (or more) than that projected in the Company’s most recent GRC.
The mechanism provided for collection from (or refund to) customers if weather-adjusted use per customer was less (or more) than that projected in the Company’s most recent GRC. In the 2022 GRC, parties reached an agreement that eliminated PGE’s decoupling mechanism upon the effective date of new customer prices that resulted in May 2022.
The $124 million increase related to total system load was primarily due to a 23% increase in purchased power, driven largely by the economic displacement of gas facilities in 2022, offset by a 10% decrease in the company’s own generation. 56 Table of Contents PGE’s sources of energy, total system load, and retail load requirement for the years presented are as follows: Years Ended December 31, 2022 2021 Sources of energy (MWh in thousands): Generation: Thermal: Natural gas 8,242 31 % 9,306 37 % Coal 2,186 8 2,060 8 Total thermal 10,428 39 11,366 45 Hydro 1,027 4 1,073 4 Wind 1,765 7 2,316 9 Total generation 13,220 50 14,755 58 Purchased power: Hydro 6,297 24 4,789 19 Wind 824 3 989 4 Solar 723 3 501 2 Natural Gas 33 — 63 — Waste, Wood and Landfill Gas 168 1 167 1 Source not specified 4,961 19 4,031 16 Total purchased power 13,006 50 10,540 42 Total system load 26,226 100 % 25,295 100 % Less: wholesale sales (6,000) (5,946) Retail load requirement 20,226 19,349 Purchased power in the table above includes power received from qualifying facilities under the Public Utility Regulatory Policies Act of 1978 (PURPA) as follows: Years Ended December 31, 2022 2021 Sources of energy (MWhs in thousands): PURPA purchased power: Hydro 36 15 Wind 25 30 Solar 588 472 Waste, Wood, Landfill Gas, and Other 101 102 Total 750 619 The following table presents the forecasted April-to-September 2023 and actual April-to-September 2022 and 2021 runoff at particular points of major rivers relevant to PGE’s hydro resources: Runoff as a Percent of Normal* Location 2023 Forecast 2022 Actual 2021 Actual Columbia River at The Dalles, Oregon 83 % 107 % 82 % Mid-Columbia River at Grand Coulee, Washington 83 110 89 Clackamas River at Estacada, Oregon 90 139 70 Deschutes River at Moody, Oregon 78 92 84 * Volumetric water supply forecasts and historical averages for the Pacific Northwest region are prepared by the Northwest River Forecast Center, with the Natural Resources Conservation Service and other cooperating agencies. 57 Table of Contents Actual NVPC , which consists of Purchased power and fuel expense net of Wholesale revenues, increased $59 million in 2022 compared with 2021.
PGE’s sources of energy, total system load, and retail load requirement for the years presented are as follows: Years Ended December 31, 2023 2022 Sources of energy (MWh in thousands): Generation: Thermal: Natural gas 10,981 40 % 8,242 31 % Coal 2,214 8 2,186 8 Total thermal 13,195 48 10,428 39 Hydro 1,144 4 1,027 4 Wind 1,918 7 1,765 7 Total generation 16,257 59 13,220 50 Purchased power: Hydro 4,646 17 6,297 24 Wind 846 3 824 3 Solar 1,055 4 723 3 Natural Gas 184 1 33 — Waste, Wood and Landfill Gas 163 1 168 1 Source not specified 4,018 15 4,961 19 Total purchased power 10,912 41 13,006 50 Total system load 27,169 100 % 26,226 100 % Less: wholesale sales (6,950) (6,000) Retail load requirement 20,219 20,226 59 Table of Contents Purchased power in the table above includes power received from qualifying facilities under the Public Utility Regulatory Policies Act of 1978 (PURPA) as follows: Years Ended December 31, 2023 2022 Sources of energy (MWhs in thousands): PURPA purchased power: Hydro 28 36 Wind 25 25 Solar 592 588 Waste, Wood, Landfill Gas, and Other 114 101 Total 759 750 The following table presents the forecasted April-to-September 2024 and actual April-to-September 2023 and 2022 runoff at particular points of major rivers relevant to PGE’s hydro resources: Runoff as a Percent of Normal* Location 2024 Forecast 2023 Actual 2022 Actual Columbia River at The Dalles, Oregon 81 % 83 % 107 % Mid-Columbia River at Grand Coulee, Washington 79 79 110 Clackamas River at Estacada, Oregon 92 101 139 Deschutes River at Moody, Oregon 99 98 92 * Volumetric water supply forecasts and historical averages for the Pacific Northwest region are prepared by the Northwest River Forecast Center, with the Natural Resources Conservation Service and other cooperating agencies.
In 2020, the OPUC acknowledged, subject to conditions and directives, the Company’s 2019 IRP and associated Action Plan. With the passage of HB 2021, PGE is preparing a Clean Energy Plan (CEP), which will articulate the Company’s strategy to meet the 2030, 2035, and 2040 emission reduction targets through an equitable transition to a decarbonized grid.
With the passage of HB 2021, PGE created a Clean Energy Plan (CEP), which articulates the Company’s strategy to meet the 2030, 2035, and 2040 emission reduction targets through an equitable transition to a decarbonized grid. The CEP is based on, and was filed in connection with, the Company’s 2023 IRP.
In May 2022, the Court granted the motion to dismiss to which NewSun responded in June 2022 by filing a notice of appeal with the Court of Appeals of the State of Oregon. NewSun has requested multiple extensions to file opening briefs in the appeal.
In May 2022, the Court granted the motion to dismiss to which NewSun responded in June 2022 by filing a notice of appeal with the Court of Appeals of the State of Oregon. After receiving multiple extensions, NewSun filed its opening brief in the appeal in February 2023 and PGE filed a response brief on June 1, 2023.
The results of operations are as follows for the years presented (dollars in millions): Years Ended December 31, % Increase (Decrease) 2022 2021 Amount Amount Total revenues $ 2,647 $ 2,396 10 % Operating expenses: Purchased power and fuel 988 822 20 Generation, transmission and distribution 348 310 12 Administrative and other 340 336 1 Depreciation and amortization 417 404 3 Taxes other than income taxes 157 146 8 Total operating expenses 2,250 2,018 11 Income from operations 397 378 5 Interest expense, net * 156 137 14 Other income: Allowance for equity funds used during construction 14 17 (18) Miscellaneous income, net 17 9 89 Other income, net 31 26 19 Income before income taxes 272 267 2 Income tax expense 39 23 70 Net income $ 233 $ 244 (5) % * Includes an allowance for borrowed funds used during construction of $7 million in 2022 and $8 million in 2021. 2022 Compared to 2021 Net income for 2022 decreased $11 million from 2021 as the impact of higher natural gas and electricity prices coupled with increased customer demand drove Purchased power and fuel expense up.
The results of operations are as follows for the years presented (dollars in millions): Years Ended December 31, % Increase (Decrease) 2023 2022 Amount Amount Total revenues $ 2,923 $ 2,647 10 % Operating expenses: Purchased power and fuel 1,190 988 20 Generation, transmission and distribution 374 348 7 Administrative and other 341 340 — Depreciation and amortization 458 417 10 Taxes other than income taxes 164 157 4 Total operating expenses 2,527 2,250 12 Income from operations 396 397 — Interest expense, net * 173 156 11 Other income: Allowance for equity funds used during construction 19 14 36 Miscellaneous income, net 31 17 82 Other income, net 50 31 61 Income before income taxes 273 272 — Income tax expense 45 39 15 Net income $ 228 $ 233 (2) % * Includes an allowance for borrowed funds used during construction of $13 million in 2023 and $7 million in 2022. 2023 Compared to 2022 Net income for 2023 decreased $5 million from 2022.
For further information regarding seasonal fluctuations, see “Seasonality” in the Customers and Revenues section in Item 1.—“Business.” Retail customer price changes and customer usage patterns, which can be affected by the economy and recently, by changes resulting from COVID-19, also have an effect on revenues.
During the summer of 2023, demand reached a new all-time high, surpassing the previous mark, which was set in 2021. For further information regarding seasonal fluctuations, see “Seasonality” in the Customers and Revenues section in Item 1.—“Business.” Retail customer price changes and customer usage patterns, which can be affected by the economy, also have an effect on revenues.
See “ Power operations ” within this Overview section of Item 7 for more information regarding the PCAM. 47 Table of Contents Portland Harbor Environmental Remediation Account (PHERA) mechanism — The EPA has listed PGE as one of over one hundred Potentially Responsible Parties (PRPs) related to the remediation of the Portland Harbor Superfund site.
Portland Harbor Environmental Remediation Account (PHERA) mechanism — The EPA has listed PGE as one of over one hundred Potentially Responsible Parties (PRPs) related to the remediation of the Portland Harbor 50 Table of Contents Superfund site.
Under the PSO, customers who enrolled in Phase I can receive energy from PGE-provided purchased power agreements (PPAs) for renewable resources and customers who enroll in Phase II can receive energy from PGE-provided PPAs for renewable resources or energy from renewable resources that are PGE owned, under certain conditions.
Under the PSO, customers who enrolled in Phase I can receive energy from PGE-provided purchased power agreements (PPAs) for renewable resources and customers who enroll in Phase II can receive energy either from PGE-provided PPAs for renewable resources or energy from renewable resources that are PGE owned, under certain conditions. 42 Table of Contents As of December 31, 2023, the Green Future Impact Program has an approved capacity of 750 MW nameplate.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2022, the total fair value and carrying amounts, excluding unamortized debt expense, by maturity date of PGE’s long-term debt are as follows (in millions): Total Fair Value Carrying Amounts by Maturity Date Total 2023 2024 2025 2026 2027 There- after First Mortgage Bonds $ 2,882 $ 3,280 $ — $ 80 $ — $ — $ 160 $ 3,040 Unsecured Term Bank Loans 260 260 260 — — — — Pollution Control Revenue Bonds 103 119 — — — — — 119 Total $ 3,245 $ 3,659 $ 260 $ 80 $ — $ — $ 160 $ 3,159 As of December 31, 2022, PGE had no long-term debt instruments subject to interest rate risk exposures except for the term loan which bears interest for the relevant interest period at the Term Secured Overnight Financing Rate (SOFR) plus Term SOFR Adjustment Rate of 10 basis points and Applicable Margin of 87.5 basis points.
Biggest changePGE currently has no financial instruments to mitigate risk related to changes in short-term interest rates, including those on commercial paper; however, it may consider such instruments in the future as deemed necessary. 70 Table of Contents As of December 31, 2023, the total fair value and carrying amounts, excluding unamortized debt expense, by maturity date of PGE’s long-term debt are as follows (in millions): Total Fair Value Carrying Amounts by Maturity Date Total 2024 2025 2026 2027 2028 There- after First Mortgage Bonds $ 3,598 $ 3,880 $ 80 $ — $ — $ 160 $ 100 $ 3,540 Pollution Control Revenue Bonds 107 119 — — — — — 119 Total $ 3,705 $ 3,999 $ 80 $ — $ — $ 160 $ 100 $ 3,659 As of December 31, 2023, PGE had no long-term debt instruments subject to interest rate risk exposures Credit Risk PGE is exposed to credit risk in its commodity price risk management activities related to potential nonperformance by counterparties.
As of December 31, 2022, a 10% change in the value of the Canadian dollar would result in an immaterial change in exposure for transactions that will settle over the next twelve months.
As of December 31, 2023, a 10% change in the value of the Canadian dollar would result in an immaterial change in exposure for transactions that will settle over the next twelve months.
PGE remains subject to cash flow risk in the form of collateral requirements 67 Table of Contents based on the value of open positions and regulatory risk if recovery is disallowed by the OPUC. PGE attempts to mitigate both types of risks through prudent energy procurement practices.
PGE remains subject to cash flow risk in the form of collateral requirements based on the value of open positions and regulatory risk if recovery is disallowed by the OPUC. PGE attempts to mitigate both types of risks through prudent energy procurement practices.
Energy Risk Management PGE has an Executive Risk Committee (ERC) whose primary purpose is to oversee, guide, and support the prudent management of the Company’s risks, as well as review and recommend energy portfolio risk limits that are subject to approval by the Audit and Risk Committee of the PGE Board of Directors, and in some instances, the full Board.
Energy Risk Management PGE has an Executive Risk Committee (ERC) whose primary purpose is to oversee, guide, and support the prudent management of the Company’s risks, as well as review and recommend energy portfolio risk limits that are subject to approval by the Audit and Risk Committee of the PGE Board of Directors.
For additional information, see “ Public utility districts ” in Note 16, Commitments and Guarantees, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Management believes that circumstances that could result in the nonperformance by these counterparties are remote.
For additional information, see “ Public utility districts ” in Note 16, Commitments and Guarantees, in the Notes to Consolidated Financial Statements in Item 8.—“Financial Statements and Supplementary Data.” Management believes that circumstances that could result in the nonperformance by these counterparties are remote. 71 Table of Contents
Foreign currency risk is the risk of changes in value of pending financial obligations in foreign currencies that could occur prior to the settlement of the obligation due to a change in the value of that foreign currency in relation to the U.S. dollar. PGE mitigates its exposure to fluctuations in the Canadian exchange rate with an appropriate hedging strategy.
Foreign currency risk is the risk of changes in value of pending financial obligations in foreign currencies that could occur prior to the settlement of the obligation due to a change in the value of that foreign currency in relation to the U.S. dollar. PGE employs a hedging strategy to mitigate its exposure to fluctuations in the Canadian exchange rate.
The Company also enters into contracts for the purchase and sale of fuel for the Company’s natural gas- and coal-fired generating plants. These contracts for the purchase of power and fuel expose the Company to market risk.
The Company also enters into contracts for the purchase of fuel for the Company’s natural gas- and coal-fired generating plants, and the sale of natural gas in excess of amounts needed for the Company’s natural gas-fired generating plants. 69 Table of Contents These contracts for the purchase of power and fuel expose the Company to market risk.
Assuming no changes in market prices and interest rates, the following table presents the years in which the net unrealized (gains)/losses recorded as of December 31, 2022 related to PGE’s derivative activities would become realized as a result of the settlement of the underlying derivative instrument (in millions): 2023 2024 2025 2026 2027 Thereafter Total Commodity contracts: Electricity $ (19) $ 10 $ 21 $ (3) $ (3) $ (16) $ (10) Natural gas (177) (8) (2) 3 — — (184) Net unrealized (gain)/loss $ (196) $ 2 $ 19 $ — $ (3) $ (16) $ (194) PGE reports energy commodity derivative fair values as a net asset or liability, which combines purchases and sales expected to settle in the years noted above.
Assuming no changes in market prices and interest rates, the following table presents the years in which the net unrealized (gains)/losses recorded as of December 31, 2023 related to PGE’s derivative activities would become realized as a result of the settlement of the underlying derivative instrument (in millions): 2024 2025 2026 2027 2028 Thereafter Total Commodity contracts: Electricity $ 39 $ 18 $ (2) $ (2) $ (1) $ (1) $ 51 Natural gas 104 36 14 1 — — 155 Net unrealized (gain)/loss $ 143 $ 54 $ 12 $ (1) $ (1) $ (1) $ 206 PGE reports energy commodity derivative fair values as a net asset or liability, which combines purchases and sales expected to settle in the years noted above.
Credit Risk PGE is exposed to credit risk in its commodity price risk management activities related to potential nonperformance by counterparties. The Company manages the risk of counterparty default according to its credit policies by performing financial credit reviews, setting limits and monitoring exposures, and requiring collateral (in the form of cash, letters of credit, and guarantees) when needed.
The Company manages the risk of counterparty default according to its credit policies by performing financial credit reviews, setting limits and monitoring exposures, and requiring collateral (in the form of cash, letters of credit, and guarantees) when needed.
PGE also uses standardized enabling agreements and, in certain cases, master netting agreements, which allow for the netting of positive and negative exposures under multiple agreements with counterparties. Despite such mitigation efforts, defaults by counterparties may periodically occur.
PGE also uses standardized enabling agreements and, in certain cases, master netting agreements, which allow for the netting of positive and negative exposures under multiple agreements with counterparties. Despite such mitigation efforts, defaults by counterparties may periodically occur. Based upon periodic review and evaluation, allowances are recorded as needed to reflect credit risk related to wholesale accounts receivable.
Based upon periodic review and evaluation, allowances are recorded as needed to reflect credit risk related to wholesale accounts receivable. 68 Table of Contents The large number and diversified base of residential, commercial, and industrial customers, combined with the Company’s ability to discontinue service, within certain limits, contribute to reduce credit risk with respect to trade accounts receivable from retail sales.
The large number and diversified base of residential, commercial, and industrial customers, combined with the Company’s ability to discontinue service, within certain limits, contribute to reduce credit risk with respect to trade accounts receivable from retail sales. Estimates are used to provide an allowance for uncollectible accounts receivable related to retail sales to address such risk.
Estimates are used to provide an allowance for uncollectible accounts receivable related to retail sales to address such risk. As of December 31, 2022, PGE’s credit risk exposure is $340 million for commodity activities, of which $335 million is with externally-rated investment grade counterparties. The underlying transactions that make up the exposure will mature from 2023 to 2026.
As of December 31, 2023, PGE’s credit risk exposure is $50 million for commodity activities, of which $15 million is with externally-rated investment grade counterparties. The underlying transactions that make up the exposure will mature from 2023 to 2025.
As of December 31, 2022, PGE had no borrowings outstanding under its revolving credit facility and no commercial paper outstanding. PGE currently has no financial instruments to mitigate risk related to changes in short-term interest rates, including those on commercial paper; however, it may consider such instruments in the future as considered necessary.
As of December 31, 2023, PGE had no borrowings outstanding under its revolving credit facility and $146 million commercial paper outstanding.

Other POR 10-K year-over-year comparisons