Portland General Electric Company (NYSE: NYSE:POR) reported its Q3 2023 earnings with a GAAP net income of $47 million, or $0.46 per diluted share, a decrease from $58 million, or $0.65 per diluted share, in the same quarter of 2022. Despite challenging power cost conditions and a decrease in residential and commercial usage due to cooler weather, the company's capital programs remain on track. The company anticipates improved fourth-quarter results, with full-year earnings guidance revised to $2.60 to $2.65 per diluted share.
Key takeaways from the call:
- The company experienced a significant spike in energy costs due to a major heat event in mid-August.
- The Clearwater Wind project is expected to come online later this year, and progress is being made on battery storage projects.
- The company announced several federal grants to accelerate new technologies and transmission construction.
- The company maintains a long-term earnings growth rate of 5% to 7% in 2024 and beyond.
- The 2024 general rate case is pending approval from the Oregon Public Utility Commission (OPUC), with a decision expected by December.
- The company's liquidity and financing position remains strong, with $925 million in total available liquidity as of September 30th, 2023.
In the earnings call, the company discussed the impact of the August heat event on the quarter's results. Operating expenses increased due to higher generation and grid maintenance costs. The company's capital forecast through 2027 is being evaluated, with an update planned for the Q4 call in February.
The company also discussed its focus on wildfire prevention and collaboration with forest agencies and local entities. It highlighted growth opportunities in the semiconductor industry and the potential for growth in sales and customer demand. The company remains confident in its long-term growth rate of 5% to 7% and sees 2023 as an investment year.
During the call, Maria Pope, a company representative, expressed confidence in the long-term growth rate. She stated that 2023 was an investment year and that there were no hesitations about 2024. The company has focused on cost management and driving efficiencies.
The company's transmission strategy involves reconductoring projects within its service territory or adjacent to it. The PCAM mechanism, which adjusts net variable power costs, had a negative impact in the quarter, but the company expects improvement in the fourth quarter.
During the call, Portland General Electric (NYSE:GE) discussed the need for building transmission and enhancing overall reliability. They mentioned projects like Pelton Round Butte and reconductoring within the service territory. The company also addressed questions about the PCAM mechanism and its impact on net variable power costs.
Maria Pope, CEO of Portland General Electric, mentioned that the rate case outcome was constructive and supported their growth opportunities. They have investment opportunities through the Integrated Resource Plan (IRP) update and recent grants. Pope concluded the call by expressing appreciation for the interest in Portland General Electric and looking forward to connecting at the EEI conference.
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