Portland General Electric (POR)

Management Discussion

• * 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.
• Net income for the three months ended June 30, 2022 was double that of the three months ended June 30, 2021 as total revenues increased while Purchased power and fuel expenses declined. Revenues increased as a result of several factors, including an increase in customer prices to cover anticipated higher net variable power costs as authorized by the OPUC in the AUT. The Company was able to optimize forward contracts for power and natural gas to lower its Purchased power and fuel expense compared to the same period of 2021, thus improving income from operations. Wholesale revenues also increased substantially while Other operating revenues reflected gains from the sale of excess natural gas back into the market. Total operating expenses were comparable to the prior year quarter as the savings in Purchased power and fuel expense mostly offset modest increases in the other line items. Other income declined primarily due to changes in performance of the Non-qualified benefit plan trust assets. Income taxes increased due primarily to higher Income before income tax expense.
• Net income for the six months ended June 30, 2022 was comparable to the same period of 2021. Wholesale revenues were the largest contributor to higher revenues in 2022 as both volumes and prices have increased. Increases in Retail revenues were led by the increase in customer prices to cover anticipated higher net variable power costs, as authorized by the OPUC in the AUT, which were anticipated to be offset by higher power costs.