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:

•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;

•unseasonable or extreme 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

•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;

•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;

•changes in, and compliance with, environmental laws and policies, including those related to threatened and endangered species, fish, and wildlife;

•changes in residential, commercial, or industrial customer demand, or demographic patterns, in PGE's service territory;

•the effectiveness of PGE's risk management policies and procedures;

•cybersecurity attacks, data security breaches, physical 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, employee, or Company information;

•new federal, state, and local laws that could have adverse effects on operating results;

•political and economic conditions;

•changes in financial or regulatory accounting principles or policies imposed by governing bodies;

•acts of war or terrorism; and

•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.

•Decarbonize the power supply by reducing greenhouse gas (GHG) emissions associated with the power served to customers in-line with the GHG reduction targets set by Oregon House Bill (HB) 2021, ultimately achieving zero GHG emissions associated with the power served to customers by 2040;

•Electrify other sectors of the economy like transportation and buildings that are also transforming to reduce GHG emissions; and

•Perform by improving work efficiency, safety of its workforce, and reliability of its systems and equipment, all while adhering to the Company's long-term earnings per diluted share growth guidance of 4-6% on average.

Investing in a clean energy future

•Approximately 375 to 500 MW of renewable resources;

•Approximately 375 MW of non-emitting dispatchable capacity resources that can be used to meet peak customer demand; and

In October 2021, PGE filed an extension waiver for the next IRP that the OPUC approved. As a result, the next IRP will be filed for OPUC consideration by March 31, 2023.

•Aligns with PGE decarbonization goals while protecting affordability and reliability;

•Establishes clear decarbonization authority for the OPUC, including authority over ESSs;

•Modernizes competition provisions of Oregon's electricity restructuring law from 1999, Oregon Senate Bill 1149 (SB 1149);

•Codifies non-bypassability of costs to ensure all customers pay their share of HB 2021 policy costs.

•encourage electric companies to support transportation electrification infrastructure that supports GHG emissions reductions and zero-emission vehicle goals;

•determine whether utility portfolios and customer programs reduce risks and costs to utility customers by making rapid progress towards reducing GHG emissions consistent with Oregon's reduction goals.

Other provisions of the law include:

•An increase in RPS thresholds to 27% by 2025, 35% by 2030, 45% by 2035, and 50% by 2040;

•An allowance for energy storage costs related to renewable energy in the Company's Renewable Adjustment Clause (RAC) filings.

PGE, OPUC staff, and certain customer groups reached an agreement that resolved cost of capital issues and allowed for:

•A capital structure of 50% debt and 50% equity;

•A return on equity of 9.5%; and

•A cost of capital of 6.83%, which reflects updates for actual and forecasted debt costs.

Base Business Revenue Requirement Updates:

Cost of debt settlement including reductions to reflect actual financing costs

Other reductions to rate base and operating and maintenance expenses

(3) Total revenue requirement increase to base rates is $83 million, of which $9 million is not considered incremental as it was already included in current customer prices via a supplemental tariff.

•establishment of a balancing account for the Company's major storm damage recovery mechanism;

•creation of an earnings test for the deferrals for the 2020 Labor Day wildfire and the February 2021 ice storm and damage to be applied on a year-by-year basis.

Complete details of the 2022 GRC filing (OPUC Docket UE 394) and the resulting OPUC Order are available on the OPUC Internet website at www.oregon.gov/puc.

The Company's deferral application for expenses related to wildfire mitigation, filed in 2019 under OPUC Docket UM 2019, has not yet been approved by the OPUC.

As of December 31, 2021, PGE had recorded a total estimated refund of $10 million that, subject to OPUC approval, will be refunded to customers over a one-year period, which would begin January 1, 2023.

The following tables provide financial and operational information to be considered in conjunction with management's discussion and analysis of results of operations.

* Includes an allowance for borrowed funds used during construction of $1 million and $2 million for the three months ended June 30, 2022 and 2021, and $3 million and $4 million for the six months ended June 30, 2022 and 2021, respectively.

Increase as a result of the AUT, approved by the OPUC (partially offset in Purchased power and fuel)

Increase from higher retail energy deliveries driven by customer load growth

Increase attributed to alternative revenue programs related to the decoupling mechanism due primarily to increased residential use per customer in 2021 and prorated elimination of the mechanism in 2022

Decrease resulting from the combination of various supplemental tariffs and adjustments

Decrease as a result of the change in the average price of energy deliveries due primarily to shift in mix among customer classes resulting from COVID-19 economic recovery and increased industrial demand

The following table presents the forecast April-to-September 2022 and the actual 2021 runoff at particular points of major rivers relevant to PGE's hydro resources:

Runoff as a Percent of Normal*

* 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.

Actual NVPC for the three and six months ended June 30, 2022 decreased compared to the same period in 2021 as follows (in millions):

test created in OPUC 2022 GRC Order Higher service restoration and storm response costs, other than February 2021 wind and ice storm restoration expenses

(Lower)/higher distribution vegetation management, inspection, and maintenance expenses

PGE experienced higher Generation, transmission and distribution expenses largely from vegetation management activities coupled with a strong labor market and rising cost of materials and supplies.

Critical Accounting Policies and Estimates

natural gas commodity prices Increase related to Margin deposits paid to wholesale counterparties due to natural gas commodity prices

Increase related to the Deferral of incremental storm costs in 2021

Increase as a result of changes in Accounts receivable and Unbilled revenue

The following table presents PGE's estimated capital expenditures and contractual maturities of long-term debt for 2022 through 2026, excluding AFUDC (in millions).

Long-term Debt. As of June 30, 2022, PGE's total long-term debt outstanding, net of $13 million of unamortized debt expense, was $3,286 million.

© Edgar Online, source Glimpses