Portland General Electric Co

Good morning everyone and welcome to today's conference call with Portland General Electric. Today is Friday, July 31st, 2026. This call is being recorded and all lines have been placed on mute to prevent background noise. After the speaker's remarks, there will be a question and answer period. If you would like to ask a question during this time, press star, then the Thank you, DG. Good morning, everyone, and thank you for joining us today.

Before we begin, I would like to remind you that we issued a press release this morning and have prepared a presentation to supplement our discussion, which we will be referencing throughout the call. The press release and slides are available on our website at investors.portlandgeneral.com. Referring to slide two, some of our remarks this morning will constitute forward-looking statements. We caution you that such statements involve inherent risks and uncertainties, and actual results may differ materially from our expectations. For a description of some of the factors that could cause actual results to differ materially, please refer to our press release and our most recent forms 10-K and 10-Q, which are available on our website. Turning to slide three, leading our discussion today are Maria Pope, President and CEO, and Joe Trpik, Senior Vice President of Finance and CFO. Following their prepared remarks, we will open the line for your questions. Now, I will turn things over to Maria.

Thank you, Erin, and good morning, everyone. We appreciate you joining us today. The second quarter was marked by continued execution across our strategic priorities. Strong industrial demand growth of 11% when compared to second quarter of last year. Advancement of key proceedings, excuse me, key regulatory proceedings, disciplined cost management, and continued progress on resource planning. Beginning with slide four, I'll speak to our financial results and key drivers. For the second quarter, we reported GAAP net income of $68 million or $0.59 per diluted share and non-GAAP net income of $74 million or $0.64 per diluted share. Our non-GAAP results exclude business transformation, optimization, and acquisition-related expenses, which are not reflective of ongoing operational performance. These costs relate to the holding company formation, the pending Washington acquisition, and our customer affordability work. These results were in line with our expectation for the quarter and reflect strong execution. As a result, we are reaffirming our full year earnings guidance of $3.53 per diluted share and our long-term earnings and dividend growth guidance of five to seven percent. Turning to slide five for updates on our five strategic priorities. First, industrial demand growth remains an important element of our long-term outlook. Today, we serve 12 different data center customers, which make up approximately one-third of our total industrial usage. Total industrial load growth was approximately 10% compounded annually over the last five years. We continue to see strong demand from technology, semiconductor, and data center customers with approximately 10% compounded annual growth expected through 2030. This outlook is supported by customers who are under contract and whom are already energized or actively advancing construction and facility development in our service area. Second, affordability remains a national focus. We've taken proactive steps to address customer cost pressures, mitigate stranded asset cost risk, and enable growth that supports the long-term strength of our communities and continued economic development. In Q2, the OPUC issued a final order approving PGE's new large load tariff, effective in July, raising average prices approximately 30% for data centers. while lowering rates for all other customers and capping several years of legislative and regulatory work. This important framework aligns infrastructure costs on an ongoing basis to customers driving new system investments while helping reduce costs for residential and small business customers. The tariff also creates greater certainty for large load customers by providing a clear pricing framework which supports investment decisions and continued economic development across our region. In addition to the changes implemented with our large load tariff, we continue to focus on operating costs and executing across our financial and operational priorities, which Jill will cover in more detail in a minute. Third, We're advancing our 2025 Renewable RFP. During the quarter, the OPC acknowledged the shortlist, marking an important milestone in the procurement process. The shortlist includes a diverse mix of wind, solar, battery storage, and hybrid resources with both purchase power and company-owned structures under consideration. We are now moving into commercial negotiations and expect to execute contracts by early 2027, subject to final negotiations and approvals. Fourth, our year-round wildfire mitigation work remains on track. We continue executing the actions identified in our 2026 through 2028 wildfire mitigation plan. and remained engaged with policymakers and stakeholders regarding long-term wildfire policy discussions. Across Oregon, there are several active wildfires and we appreciate the significant actions that first responders and local communities are taking. None of these wildfires are in PGE's service territory. And fifth, Next week, we will file our 2027 general rate case. As proposed, the case would result in approximately 4.8% overall increase relative to currently approved prices effective July 1, 2027, with residential customers seeking an approximately 3.9% increase. The residential increase would have been higher if not but for the large load tariff. The rate case increase is expected to be partially offset by lower net variable power costs, which are addressed separately to the annual update cost tariff and are currently forecast to reduce customer prices by approximately 2.4% beginning January 1st. The filing is based on a proposed 50% debt, 50% equity capital structure and a 9.75% return on equity. It reflects a balanced approach that supports continued investment and reliability, resiliency and infrastructure needed to meet growing customer demand while maintaining affordability and delivering the financial foundation necessary to serve customers, Thank you. Thank you. Thank you. Our teams remain focused on the regulatory work to obtain approvals for the Washington acquisition and continue to target a mid-2027 closing. As we move to the second half of 2026, we remain focused on delivering safe, reliable, and affordable service while advancing clean energy investments, our expansion into Washington, and completing the formation of the holding company. At the same time, we are operating to our plan and executing on actions to deliver our shareholder and customer commitments. With that, I'll turn things over to Joe. Thank you.