Balance Sheet Components (Notes)

3 Months Ended

Mar. 31, 2024

Inventories

PGE’s inventories, which are recorded at average cost, consist primarily of materials and supplies for use in operations, maintenance, and capital activities, as well as fuel, which includes natural gas, coal, and oil, for use in the Company’s generating plants. Periodically, PGE assesses whether inventories are recorded at the lower of average cost or net realizable value.

Accounts Receivable, Net

Accounts receivable, net includes $132 million and $138 million of unbilled revenues as of March 31, 2024 and December 31, 2023, respectively. Accounts receivable, net includes an allowance for credit losses of $11 million as of March 31, 2024 and $9 million as of December 31, 2023. The following summarizes activity in the allowance for credit losses (in millions):


	Three Months Ended March 31,
	2024
Balance as of beginning of period	$	9
Increase in provision	3
Amounts written off	(3)
Recoveries	2
Balance as of end of period	$	11

Other Current Assets

Other current assets consist of the following (in millions):


	March 31, 2024		December 31, 2023
Prepaid expenses	$	109	$	68

Assets from price risk management activities	29		22
Margin deposits	65		92


Other current assets	$	203	$	182

Electric Utility Plant, Net

Electric utility plant, net consists of the following (in millions):


	March 31, 2024		December 31, 2023
Electric utility plant in-service	$	13,881	$	13,329
Construction work-in-progress	628		974
Total cost	14,509		14,303
Less: accumulated depreciation and amortization	(4,846)		(4,757)
Electric utility plant, net	$	9,663	$	9,546

Accumulated depreciation and amortization in the table above includes accumulated amortization related to intangible assets of $576 million and $558 million as of March 31, 2024 and December 31, 2023, respectively. Amortization expense related to intangible assets was $18 million and $14 million for the three months ended March 31, 2024 and 2023, respectively. The Company’s intangible assets primarily consist of computer software development and hydro licensing costs.

Battery storage agreement—On April 26, 2023, PGE entered into a battery storage purchased power agreement (PPA) that will be accounted for as a lease upon commencement. The lease is expected to commence in December 2024 and has a term of 20 years. The total fixed contract consideration is expected to be $737 million over the lease term.

Regulatory Assets and Liabilities

Regulatory assets and liabilities consist of the following (in millions):


	March 31, 2024					December 31, 2023
	Current			Noncurrent		Current			Noncurrent
Regulatory assets:
Price risk management	$	108		$	48	$	143		$	63
Reliability contingency events	—			75		—			—
Pension and other postretirement plans	—			104		—			104


Trojan decommissioning activities	—			141		—			139
February 2021 ice storm and damage	12			53		12			55
January 2024 storm and damage	—			48		—			—

2020 Labor Day wildfire	5			22		5			23

Wildfire mitigation	19			13		19			10
Other	33			102		42			98
Total regulatory assets	$	177		$	606	$	221		$	492
Regulatory liabilities:
Asset retirement removal costs	$	—		$	1,178	$	—		$	1,173
Deferred income taxes	—			171		—			177



Clearwater RAC	—			10		—			—
Other	50			47		48			48
Total regulatory liabilities	$	50	*	$	1,406	$	48	*	$	1,398

* Included in Accrued expenses and other current liabilities in the condensed consolidated balance sheets.

January 2024 storm and damage—Beginning January 13, 2024, the Company’s service territory encountered a severe winter weather event that included snow, ice, and high winds over several days that caused catastrophic damage to physical assets and resulted in widespread customer power outages. As a result of the historic winter storm, Oregon’s Governor declared a state of emergency on January 19, 2024, which will allow PGE to seek recovery of incremental storm expenses through the OPUC pre-authorized emergency deferral mechanism. On February 9, 2024, PGE filed a Notice of Deferral with the OPUC, under Docket UM 2190, related to the emergency restoration costs for the January storm, and as of March 31, 2024, PGE’s deferred balance related to the January 2024 storm was $48 million. PGE believes amounts deferred as of March 31, 2024 are probable of recovery under the emergency deferral mechanism. The OPUC has significant discretion in making the final determination of recovery. The OPUC’s conclusion of overall prudence, including an earnings test, could result in a portion, or all, of PGE’s deferrals being disallowed for recovery. Such disallowance would be recognized as a charge to earnings.

Reliability contingency events—A portion of the January 2024 storm also qualified as a Reliability Contingency Event (RCE) as approved by the OPUC in PGE’s 2024 GRC. Under the RCE mechanism, PGE is allowed to defer and recover 80% of prudent costs for RCEs above amounts forecasted in the Company’s Annual Power Cost Update Tariff, without application of an earnings test, with the remaining 20% flowing through operating expenses and subject to the existing PCAM. As of March 31, 2024, PGE’s deferred balance related to the 2024 RCE was $75 million. Full impacts cannot be determined until all settlements and invoices are received for the period to which the RCE applies. PGE files the results of the PCAM annually with the OPUC no later than July 1, initiating a regulatory review process that typically results in a final determination and order from the OPUC by the end of the year, with any resulting refund or collection impacting customer prices effective January 1 of the following year. Costs related to the RCE in January 2024 will be included in the Company’s PCAM for 2024, which the Company expects to file no later than July 1, 2025. The OPUC has significant discretion in making the final determination of

recovery. The OPUC’s conclusion of overall prudence could result in a portion, or all, of PGE’s deferrals being disallowed for recovery. Such disallowance would be recognized as a charge to earnings.

Wildfire Mitigation represents incremental costs and investments made by PGE related to intensifying efforts on its system to mitigate the risk of wildfire and improve resiliency to wildfire damage under SB 762, enacted in July 2021. These efforts include enhanced tree and brush clearing, hardening equipment, and making emergency plans in close partnership with various land and emergency management agencies to further expand the use of a public safety power shutoff, if the need should arise. PGE submitted its 2024 risk-based Wildfire Mitigation Plan to the OPUC in December 2023, and it is pending approval from the OPUC, which is expected no later than June 25, 2024.

As of March 31, 2024 and December 31, 2023, PGE’s deferred balance related to incremental wildfire mitigation operating expenses was $32 million and $29 million, respectively. The 2024 balance is comprised of:

•Pre-AAC—Prior to establishing the collections noted below, PGE had deferred incremental costs related to wildfire mitigation and as of March 31, 2024 this balance is $22 million. On July 1, 2022, PGE filed an application for reauthorization of OPUC Docket UM 2019 to defer incremental wildfire mitigation costs that exceed the amount granted in base rates. On May 10, 2023, in Order No. 23-173, the OPUC approved an automatic adjustment clause mechanism to recover wildfire mitigation costs (capital and expense). PGE and certain parties agreed to a stipulation, which was adopted by the OPUC on October 18, 2023, that allows PGE to begin amortizing $27 million comprised of $23 million related to the September 30, 2023 deferred operating expense balance of $31 million and $4 million for capital related revenue requirement.

•2023 Base rates—The outcome of PGE’s 2022 GRC provided an annual amount of $24 million to be collected in base rates for recovery of operating expenses related to wildfire mitigation efforts beginning May 9, 2022, through December 31, 2023. As of March 31, 2024, there was $1 million in the balancing account.

•2024 AAC—Beginning January 1, 2024, and in conjunction with the Company’s 2024 GRC proceeding, PGE removed 2024 related collections for wildfire mitigation costs (for both capital and expense) from base prices and will include the forecasted costs for current year spending within the automatic adjustment clause in a separate tariff, with the final amount pending OPUC approval. Differences between actual expense and customer collections will be recorded as regulatory assets or liabilities within the automatic adjustment clause balancing account, which will be subject to a prudence review, but will not be subject to an earnings test. As of March 31, 2024, there was $9 million in the balancing account.

The OPUC has significant discretion in making the final determination of recovery. The OPUC’s conclusion of overall prudence could result in a portion, or all, of PGE’s deferrals being disallowed for recovery. Such disallowance would be recognized as a charge to earnings.

Clearwater RAC—The RAC allows PGE to recover prudently incurred costs of renewable resources through filings made each year, outside of a GRC. Under the RAC, during 2023, the Company submitted a filing for Clearwater, which estimated the annual revenue requirement, net of NVPC benefits to be a refund to customers of approximately $30 million that would be included in customers prices June 1, 2024. Pursuant to the filing, PGE would defer the revenue requirement, net of NVPC benefits from the in-service date of January 2024 until Clearwater was reflected in customer prices. On April 4, 2024, the OPUC rejected PGE and parties’ Stipulation regarding Clearwater and requested that PGE submit reply testimony responding to the arguments raised by the OPUC Staff by April 25, 2024. The rejection order provided a new target rate effective date of August 1, 2024. As of March 31, 2024, the Company had recorded a $10 million regulatory liability refund to customers. The OPUC has significant discretion in making the final determination of recovery. The OPUC’s conclusion of overall prudence could result in a portion, or all, of PGE’s deferrals being disallowed for recovery. Such disallowance would be recognized as a charge to earnings.

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (in millions):


	March 31, 2024		December 31, 2023
Accrued employee compensation and benefits	$	50	$	74
Accrued taxes payable	29		30
Accrued interest payable	58		40
Accrued dividends payable	50		51
Regulatory liabilities—current	50		48
Margin deposits from wholesale counterparties	5		5
Other	114		107
Total accrued expenses and other current liabilities	$	356	$	355

Credit Facilities

On August 18, 2023, PGE entered into an amendment of its existing revolving credit facility. As of March 31, 2024, PGE had a $750 million revolving credit facility scheduled to expire in September 2028. The Company has the ability to expand the revolving credit facility to $850 million, if needed, subject to the requirements of the agreement. Pursuant to the terms of the agreement, the revolving credit facility may be used for general corporate purposes, including as backup for commercial paper borrowings and to permit the issuance of standby letters of credit. PGE may borrow for one, three, or six months at a fixed interest rate established at the time of the borrowing, or at a variable interest rate for any period up to the then remaining term of the applicable credit facility. The revolving credit facility contains a provision that requires annual fees based on the Company’s unsecured credit ratings, and contains customary covenants and default provisions, including a requirement that limits consolidated indebtedness, as defined in the agreement, to 65% of total capitalization. As of March 31, 2024, PGE was in compliance with this covenant with a 56.9% debt-to-total capital ratio and had no outstanding balance on the revolving credit facility. As a result of the policy to backup commercial paper borrowings, the aggregate unused available credit capacity under the credit facility was $750 million. In addition, the credit facility offers the potential for adjustments to interest rate margins and fees based on PGE’s achievement of certain annual sustainability-linked metrics related to its non-emitting generation capacity and the percentage of management comprised of women and employees who identify as black, indigenous, and people of color. The Company believes these potential adjustments will have an immaterial impact on PGE’s results of operations.

The Company has a commercial paper program under which it may issue commercial paper for terms of up to 270 days. The Company has elected to limit its borrowings under the revolving credit facility in order to allow for coverage of any potential need to repay commercial paper that may be outstanding at the time. As of March 31, 2024, PGE had no commercial paper outstanding.

PGE typically classifies borrowings under the revolving credit facility and outstanding commercial paper as Short-term debt on the condensed consolidated balance sheets.

In addition, PGE has four letter of credit facilities that provide a total capacity of $320 million under which the Company can request letters of credit for original terms not to exceed one year. The issuance of such letters of credit is subject to the approval of the issuing institution. Under these facilities, letters of credit for a total of $131 million were outstanding as of March 31, 2024. Letters of credit issued are not reflected on the Company’s condensed consolidated balance sheets.

Pursuant to an order issued by the FERC, the Company is authorized to issue short-term debt in an aggregate amount of up to $900 million through February 6, 2026.

Long-term Debt

On February 22, 2024, PGE entered into a Bond Purchase Agreement related to the sale of $450 million in First Mortgage Bonds (FMBs). The Bonds were issued and funded in full on February 22, 2024 and consist of:

•a series, due in 2029, in the amount of $100 million that will bear interest from its issuance date at an annual rate of 5.15%;

•a series, due in 2034, in the amount of $100 million that will bear interest from its issuance date at an annual rate of 5.36%; and

•a series, due in 2054, in the amount of $250 million that will bear interest from its issuance date at an annual rate of 5.73%.

Defined Benefit Retirement Plan Costs

Components of net periodic benefit cost under the defined benefit pension plan are as follows (in millions):


	Three Months Ended March 31,
		2024		2023
Service cost		$	3	$	3
Interest cost*		8		9
Expected return on plan assets*		(10)		(11)

Net periodic benefit cost		$	1	$	1

* The net expense portion of non-service cost components are included in Miscellaneous income, net within Other income on the Company’s condensed consolidated statements of income and comprehensive income.