POR

Morning everyone, and welcome today's conference call with Portland General Electric. Today is Friday, May 1st, 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 period, press star, then the numbers one one on your telephone keypad. To withdraw your question, please press star one one again. If you do intend to ask a question, please avoid the use of speakerphones. For opening remarks, I will turn the conference over to Portland General Electric's Senior Manager of Investor Relations, Erin Schwartz. You may begin.

Thank you, Tawanda. 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 periodic reports on forms Form 10-K and Form 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. I will turn things over to Maria.

Good morning. Thank you, Erin Schwartz. Thank you all for joining us today. The first quarter delivered another stretch of warm winter weather, 10% year-over-year industrial customer demand growth, and continued maturity of our cost management initiatives. Beginning with slide four, I'll speak to our financial results and key drivers. For the first quarter, we reported GAAP net income of $45 million or $0.38 per diluted share and non-GAAP net income of $68 million or $0.58 per share. Our non-GAAP results exclude the previously disclosed deferral adjustments related to the January 2024 storm restoration and Reliability Contingency Event and business transformation, optimization, and acquisition expenses. Our results reflect extremely mild weather, particularly in February and March, and lower seasonal usage from residential and small commercial customers, which Joe Trpik will cover in more detail.

We will be engaging with our regulator to explore frameworks to help mitigate weather and other volatility impacting both revenue and power costs. Greater predictability is good for both customers and shareholders, and we recognize that this will be multi-year work. Despite weather and usage impacts, our team delivered a quarter of strong operational execution, including overcoming inflationary pressure and advancing our cost management program, adapting to power market conditions, positioning our portfolio and generation suite to deliver optimal value, and executing on our robust capital investment plan to support customer growth, clean energy, and long-term reliability. On recent calls, you have heard us highlight the company-wide work to optimize our cost structure. We are using our operational strength, which we've built over multiple years, to mitigate the impact of recent weather challenges by accelerating our cost management work.

Our teams are squarely undertaking the challenge, and we are committed to delivering strong results. As such, we are reiterating our full year earnings guidance of $3.33-$3.53 per diluted share and our long-term earnings and dividend growth guidance of 5%-7%. Turning to slide five for updates on our five key strategic priorities. First, our teams made progress on the Washington acquisition and other key regulatory filings. In late March and early April, we filed applications with the Washington Utilities and Transportation Commission and the Oregon Public Utility Commission for approval of the Washington transaction. We anticipate the regulatory approval process to take about a year and continue to target a mid-2027 close. PGE's holding company proposal continues to advance. The docket's procedural schedule has been modestly extended.

To prioritize timely resolution of the holding company, we have paused excuse me, the transmission company. That said, formation of a transmission company remains part of our long-term strategy. We appreciate the ongoing collaboration and expect to engage with parties in the near future, having just received reply testimony late yesterday. Many issues have been resolved with a few key items remaining. The process is on course with a target final order date probably in August. Second, building upon our 2025 O&M cost management work, we continued driving efficiencies and improving productivity. We are accelerating this work given the very warm winter weather and first quarter results. Importantly, our large load tariff proposal, UM 2377, is in the final stages of review with the Oregon Public Utility Commission, and we expect an order in the next several weeks.

A transparent, predictable tariff for new and existing data centers strengthens protections for existing customers while supporting economic development in our region. Our proposed rate structure under consideration, enabled by Oregon's recent legislation, includes a 26% increase in data center prices, which will help reduce the costs borne by residential and small business customers. Third, as I noted, industrial demand growth is accelerating in our service area. We foresee robust energy usage from data centers and high-tech customers, with large customer capacity growing by about 10% compounded annually through 2030. This growth forecast is driven by existing customers and contracts already executed with new customers, companies that own property and have civil work underway. Compared to Q1 last year, our data center customer load growth grew by 10%. Fourth, progress towards additional clean energy resource procurement.

We filed our 2025 RFP final shortlist with the OPUC in February as we aim to procure approximately 2,500 MW. The shortlist is composed of a diverse mix of projects and technologies to support our existing portfolio and growing customer demand. We look forward to working collaboratively with stakeholders to achieve commission acknowledgement in the coming months. Fifth, our year-round risk-based wildfire mitigation work remains on track as we prepare for the summer months. In parallel, regulators and policymakers are engaged in this critical topic. The OPUC, in coordination with the Oregon Department of Energy, has hired experts on wildfire liability policy options that balance customer needs for essential services, support for wildfire victims, and financial health of utilities. We expect the study's findings will help inform policymakers in advance of the 2027 legislative session.

In December, we filed our 2026 through 2028 wildfire mitigation plan, which represents a significant evolution, moving from an annual update to a forward-looking three-year strategic framework. As we progress through 2026, our focus continues to be on executing on our core priorities: solid operational performance, meeting growing energy demands, expanding into Washington State, and advancing customer-driven clean energy investments. With the first quarter behind us, opportunities are significant. We are focused on achieving solid financial results and delivering value for customers, communities, and shareholders. With that, I'll turn it over to Joe.

Thank you, Maria. Good morning, everyone. Turning to slide six, our Q1 results reflect strong energy demand from our industrial customers and ongoing system investments. Total Q1 2026 loads were flat as compared to Q1 2025. Changes in demand between our customer classes were largely offsetting. Industrial demand increased 10% on a nominal and weather-adjusted basis. The industrial customer class is expected to continue growing at a strong pace, highlighting the strength of our large customer pipeline and the attractiveness of our service area to data centers and high-tech customers. Commercial load decreased 2.9% or 2.3% weather-adjusted. Residential load decreased 6.2% or 4.6% weather-adjusted. Portland General Electric has seen seasonal shifts in residential and small commercial average usage in recent years with rooftop solar adoption and energy efficiency growth.

While not considered in our 2026 plan, deviations of this magnitude are not unprecedented, we are adapting to manage through this. Historically, demand has been winter-peaking, our region has been transitioning to a dual-peaking profile, with customers increasing their cooling demand as air conditioning becomes more widespread in our region. After considering the recent trends in customer usage, we now anticipate weather-adjusted load growth of 1.5% to 2.5% this year. In the last 12 months, our organization has evolved tremendously in the ability to adapt through cost management. We have a well-defined plan in place for the balance of the year to solve for the load impacts experienced this quarter, which I will discuss shortly.

I will cover our quarter-over-quarter earnings drivers. We experienced a $0.07 increase in retail revenues, including a $0.09 increase from additional cost recovery, largely from the inclusion of our Seaside battery asset in customer rates beginning in November 2025. A $0.09 increase driven by higher industrial demand, offset by $0.11 due to lower residential demand. A decrease from power cost of $0.15, driven by $0.09 from power cost performance in 2025 that reverses for this comparison, and $0.06 from current year power cost performance driven by less favorable wholesale and environmental credit market conditions. A $0.16 decrease from other capital and financing costs in support of our ongoing rate base investments made up of $0.10 of higher depreciation and amortization, $0.05 of dilution, and $0.01 of additional interest cost.

A $0.09 decrease from other items, primarily the timing of tax credits and O&M costs. $0.10 from deferral reductions related to the January 2024 storm and reliability contingency event, reflecting the outcome of the final OPUC order received in March. A $0.10 decrease from business transformation, optimization expenses, and acquisition costs. This brings us to our GAAP EPS of $0.38 per diluted share. After adjusting for the 2024 regulatory disallowance and our business transformation expense, we reach our Q1 2026 non-GAAP EPS of $0.58 per diluted share. On to slide seven for our five-year capital forecast, which includes 2026 and 2027 spend for the incoming 2023 Request for Proposals projects. I will note this view does not contemplate CapEx from the ongoing 2025 RFP or the Washington utility business.

Given our ongoing investment in critical systems and assets serving our customers and other policy priorities, we remain engaged with stakeholders as we consider our next regulatory steps. We will keep you informed as this progresses in line with our usual practice. On to slide eight, for liquidity and financing summary. Total liquidity at the end of the quarter was $954 million. Our investment grade credit ratings remain unchanged. We will continue to maintain strong cash flow metrics with an estimated 2026 CFO to debt metric above 19%. In the first quarter, we executed a $550 million equity forward to address our 2026 base equity needs and fund the 2023 RFP project. This quarter, we also entered into two unsecured credit agreements.

A $350 million term loan facility maturing in March 2028 to fund capital expenditures, including those related to our 2023 RFP and general corporate needs, and a $680 million delayed draw term loan intended to finance the Washington acquisition and related costs. The loan is available until specific milestones tied to the acquisition are achieved and matures 364 days after funding. Lastly, in April, the board of directors declared a quarterly common stock dividend of $0.55125 per share, representing an increase of 5% on an annualized basis. We remain committed to paying a competitive dividend in line with our 60%-70% payout target while balancing overall financing needs.

Our plan focuses on maintaining strong operating cash flows while supporting continued investment in customer-focused capital projects, all while advancing us towards our authorized capital structure. As Maria and I have mentioned, our teams remain focused on advancing key priorities for the balance of the year. Most notable is our deployment of incremental cost management measures to offset load impacts on 2026 earnings to date. Relative to our plan, Q1 was $0.25 below our expectations. While $0.09 is driven by timing, we will address the remainder through refining our capital and maintenance work streams, optimizing our team, equipment, and facilities management, and positioning our power portfolio and generation fleet to deliver optimal value.

We are confident that these cost savings measures are achievable, especially when considering the $25 million we saved last year, our existing momentum built into our 2026 plan, and the opportunity to accelerate what was planned for 2027 into this year. As such, we are reaffirming our long-term earnings and dividend growth guidance of 5% to 7% and our full-year adjusted earnings guidance of $3.33-$3.53 per diluted share. We remain focused on safe, reliable, and efficient operations, advancing our strategic priorities and achieving our commitments to deliver value to our customers, communities, and shareholders. Now, operator, we are ready for questions.

Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star one one on your telephone. Wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Julien Dumoulin-Smith with Jefferies. Your line is open.

Morning, Julien.

Hey, hey, good morning, Maria. Thanks, operator. Thanks, everyone. It's nice to chat. If we can start off here a little bit more on the negotiations and conversations on the HoldCo side. I mean, what are the key areas of contention that prevented a settlement here? If you can kinda go back to the extent possible, obviously, I mean, asking about something that's difficult, but to the extent possible, elucidate a little bit around that. Particularly now that you've removed the Transco from the filing, you know, how do you think about prospects from here, given how perhaps the two have became at times a little overly intertwined?

Sure. Well, first of all, thanks, Julien. With regards to the holding company, we're really encouraged that parties have been meeting together to align thinking and to further the process. We just received a testimony yesterday, and we've agreed upon, you know, some bundled general provisions around ring fencing, including Commission's oversight, access to books and records, and other things. Obviously, we still remain pretty far apart with regards to credit, the use of leverage, and other such things, and we look forward to engaging with stakeholders as well as Commission staff. This is all part of the process, and as you can see, there were a lot of different concepts and history brought up in the filing that was just published yesterday.

Yep. Absolutely. If I can follow up real quickly here, just around the year itself, I know you guys were just talking here, you know, obviously there's been some gyrations here, especially with the start of the year. Can you talk about the levers a little bit more? It's Joe question here in the context of the remainder of the year and the offsets, if you will, against the full year number here. Again, I know the load number was moving start of the year here with 1Q. Just, yeah. Obviously cognizant ultimately of the 26 being reaffirmed here, can you speak a little bit to the levers going into that, if you will?

Sure. Good morning as well. You know, as we mentioned, our cost management program that we had in place has always been designed as a multi-year plan. You know, we achieved and slightly exceeded our goals last year. It really gave us a foundation to build off of, to have, you know, levers, tools, items in place to react to situations like this. You know, part of the plan overall was to mature the organization, to give us flexibility when situations like this occur. You know, one of the things we're doing is really taking advantage of this. It's a multi-year plan. This plan was, you know, intended to, you know, exceed beyond 2026.

We had already been working and identifying levers, you know, and benefits that were for this year, but also items for next year. We've had the ability to, you know, just look into what is our toolkit here of items and actions. In addition, you know, we're realigning based on, you know, what we're now seeing as the pattern of performance to set the portfolio up to really optimize itself based on this design. I look at this as two-prong. We have the ability of, you know, both being in our control, you know, how we plan and adapt our energy portfolio, and then how we, you know, how we plan and adapt to our cost, you know, working throughout the whole management team and organization, right? This process has already been in place.

We've already been working this because the goal of all this has always been transformation. We feel pretty confident that, you know, as we look to our, you know, our toolkit as we identify this gap, that we have, you know, the ability to execute and do things, you know, well within our control to react. Because this work had already been underway, and it's really just, you know, steering it a little differently or giving it a little more momentum.

Excellent. Awesome. Maria, just to clarify the earlier comment you made, just at this point, don't expect any kind of further settlement conversations on either the Holdco or Transco, right? I heard your comment about, you know, you remain pretty far apart about some of these key issues.

No, the process still allows for settlement conversations, and we're engaging with parties, and working through the issues.

Okay. All right, great. Thank you for that. Sorry, I wanted to make sure it came across clearly here.

No, no, thank you.

Awesome. Thank you.

Thank you. Our next question comes from the line of Shar Pourreza with Wells Fargo Securities. Your line is open.

Morning, Shar.

Hi, good morning, team. This is Whitney with Telema on for Shar. Thinking broadly on recovery tools, with the RCE mechanism no longer available, how are you thinking about the path to future reliability-related costs in a way that remains timely and investable? Should we assume the fallback is simply broader General Rate Case treatment, or are there other tools you think Oregon could still support for event-driven cost recovery?

First of all, an excellent question. Over time, you're absolutely right. We are engaging with regulators to work in removing the volatility and generating more predictability, both on the impact to energy usage from weather, as well as other issues. Obviously, RCE was around significant events, we have more volatility to power costs and exposure.

Okay. That sounds good.

This is clearly something that's going to take some time, and it's really important.

Yes. Thank you. Just as a follow-up, as it relates to the multi-year rate planning, obviously, Portland is super supportive of Oregon's transition to that. Staff's been arguing with just the transition framework, and the company finds it super restrictive. As Oregon moves into the multi-year rate plans, what do you think the main principle Portland is trying to protect? Is it the ability to retain the existing statutory tools during this transition or the ability to continue using narrower just mechanisms for high priority capital without needing a full rate case? That's it.

A good question, there's no question that we need to work on, I think, a common understanding of what's needed for all stakeholders, particularly investors, and tools that will provide for adequate capital recovery and other interim items as we move to the Multi-Year framework. I think as we saw from the surrebuttal testimony that was just issued yesterday, we have a lot of work to do around common understanding of how we'll attract and retain capital, and continue to grow the utility to invest for customers in clean energy, reliability, and customer growth.

You know, Whitney, you know, just to add, you know, to the comment, you know, you're right. There's a collection of new tools that are needed both in the transition and also in the multi-year plan. You know, we've already been adapting to those. You saw those new tools. In all honesty, the Seaside Tracker as well as the DSP that have taken some time to work through. I mean, I think, you know, what you're seeing here is we're all working to evolve here from what was a very traditional process to both a multi-year process and how to find your way to that multi-year process. I think, you know, the, you know, dialogue with the Commission is really about, you know, what type of tools do we need.

You understand they're new, that's honestly why this, you know, takes a bit of time here is to make sure they work well for all parties involved.

Sounds good. Thank you, Maria. Thank you, Joe.

Thank you.

Thank you. Our next question comes from the line of Christopher Ellinghaus with Siebert Williams Shank. Your line is open.

Hey, good morning, everybody.

Morning, Chris.

Maria, can you just talk about what you're seeing in the Oregon economy? I know it's been, you know, struggling a little bit, but can you give us some color on, you know, are you, are you seeing some recovery? Is it still sort of where it was? As an adjunct to that, customer growth year-over-year was a little lighter than 1st quarter of last year. Is that part of that issue, or there are some other factors at play?

Sure. You know, first of all, we consider customer growth to actually continue to be quite strong, particularly in the non-downtown areas. It's still slightly under 1%. We continue to also see good business formation and new entrants, particularly on the data center side, but also on the high tech and semiconductor manufacturing side. We're very encouraged. Our customers are focused, and they continue to invest in many parts of Oregon.

Okay.

Chris, if I could just add on the load, right? Just for when you asked to the patterns, right? You know, we saw this, the combination of what was some warm months and just some unusual flows of weather even within the month, that, you know, we obviously, you know, to ourselves peel back and ask ourselves very questions very similar to you. Are there economic conditions or other conditions? Really seeing items that are really reacting to what is a, you know, an unusual set of weather patterns. You know, we've had one of the warmest winters here, as well as it was a little sunnier, so you got things like a little more solar pre-penetration than you normally would have seen it in the winter months and things like that.

We didn't, you know, to Maria's comment, the broad economic factors, the guidance that gets us through what we believe are longer term, as it relates to load, you know, continues to be whole and be consistent.

Sure. There clearly are some unusual customer in-migration patterns that seem to fluctuate. I just kind of curious if there's any other factors there. Joe, in the reduction to the 2026 load expectations, is that merely a Q1 adjustment, or is there other factors that are incorporated there?

You know, as it relates on an overall basis, you know, we believe largely realized with this, you know, being the main, the heating part of the load reduction. We have reshaped the remainder of the year, but in all honesty, the reshaping is some movements between the other quarters. But from a load experience, we think we've sort of worked through the unusual part of the year on a cumulative basis and then just expect some slightly different flows here as we see differing customer reactions to heat and to heat and cold weather. But overall net should be relatively close to zero rest of the year.

Maria, you were talking about wanting to pursue, you know, some mechanism for the volatility. The weather, for you guys in the region is supposed to be on the warmer side for, you know, the spring and into the summer. That, you know, sort of effect on consumers, do you think that will be sort of inspirational for your interveners for maybe pursuing that mechanism discussion a little more?

Oh, it's a good question. Certainly last year, we began to see the impacts of significant higher air conditioning penetration. We saw quite a bit of higher load growth without as much high temperature as one would have historically needed to have seen. Definitely more correlation to high temperatures in terms of energy usage, which is a positive going forward for us, and we have not factored in that in our forecast. We're relying on those things right now that are actionable. With regards to the commission and how they might think of this, you know, affordability is a priority, and predictability for customers is super important. I have had conversations with the chair of the commission with regards to these unique patterns that we're seeing.

Those conversations, with the commissioners and with staff will be ongoing.

A couple of related questions on the Holdco. One, can we infer from the Transco, you know, sort of retreat that while you didn't come up with an official settlement that you guys have resolved some issues unofficially through that process? Secondly, the, you know, sort of references to historical events are not terribly surprising. They were very sensitive about things like ring fencing and credit, you know, back in the day. The Holdco is a pretty different animal than some of those events. You know, does the commission staff sort of appreciate the pretty significant differences despite them, you know, bringing them up again?

First of all, with regards to your question on the transmission company, our goal was to prioritize at the request of staff and commissioners, we're trying to be cognizant of their workload, and make sure that we are talking about those things which are in the highest priority. The transmission company remains a topic that we will continue to discuss in the future, but not at this time. I think that the testimony shows that we have common ground on a number of items.

I would agree with you in some of the written words in the surrebuttal testimony, and it just shows that we have more work to do, and to collaborate and establish common understanding and kind of the why and drivers, as well as utility practices across the country that are pretty standard. The next step is to engage directly and to continue the conversation.

Right. Okay. Thanks for the call. I appreciate it.

No, thank you.

Our next question comes from the line of Aidan Kelly with JPMorgan.

Morning.

Hey, guys. Good morning. Thanks for the time today. Just with the applications in Oregon and Washington now underway, could you speak to the initial feedback from stakeholders on the pending acquisition as well as the upcoming milestones we should watch for? Just any sense of kind of what the customer benefits you're highlighting for the commissions at this time?

Sure. First of all, we've engaged with a wide variety of stakeholders. We've spoken with all of the commissioners and staff in Oregon, spoken multiple times with the commissioners in Washington, as well as staff, respective, governor's offices. I think particularly important as we spend time actually in the service territory and are really encouraged by the receptivity we had, the focus on economic development, and the interest in our ability to serve current and new businesses in both the Walla Walla, Wallula, and Yakima regions. I'm really encouraged with the opportunities we move forward. In terms of discussions on benefits, we're just at the very early stages.

I would say in particular for Washington, it is very much of a constructive, business-focused environment, and we look forward to engaging with all stakeholders as we move forward.

Great. Thanks for the insight there.

Yeah, the conversations could not have gone better.

Okay. That's good to hear. Thanks for that. Yeah, a separate question, just wanted to pick up on the regulatory front again. I know it's kind of been talked about earlier in the call, maybe just clearly asking, like, could you just speak to the timing of your next GRC as we kind of get closer to your stay out expiring this summer? You know, what are the factors that would cause you to file earlier or later at this time?

Clearly we're spending a lot of time talking about that issue. We are focusing on sort of what's next, our timing. We know that energy bills are incredibly important to all businesses and families, and we are working to keep customer bills as low as possible by re- delivering reliable services that customers can count on. We also have not decided exactly on the next timing of our rate case, there's no question that it'll probably be sometime in the second half of the year. We're still evaluating the major components.

Great. Thanks. I'll leave it there. Take care.

Thank you.

Our next question comes from the line of Gregg Orrill with UBS.

Yeah. Hey, thank you. When would you be in a position to include the 25 RFP into the CapEx plan?

You know, Morning, Gregg. You know, right now our anticipation just as a reminder, right, we include the RFPs in the plan once we have them under contract. We think the earliest we'll, you know, we'll start to see contracts is the beginning of 2027 if, you know, things work to the normal course as we work through these projects. We're hoping that, you know, it'd be nice to have it, you know, aligned relatively to our fourth quarter update. As you know, since we are working with a collection of individuals and you have a series of negotiations going on that can vary.

Thank you.

Thank you. Please stand by for our next question. Our next question comes from the line of Paul Fremont with Ladenburg Thalmann & Company. Your line is open.

Morning, Paul.

Good morning. Thank you very much. I guess my first question is, should we think about the prospects for settlement being the best between now and when hearings are scheduled in early June?

Well, I hope so. The sooner we can settle, the better. I want to make sure that we give all parties an adequate time to establish good understanding and being able really to move forward constructively.

Right. In most states, you know, typically, if it's going to settle, it usually settles before hearings. Is that sort of the case in Oregon? Would you expect the prospects for being just as good after hearings?

Well, I don't know if I would hedge either side. I think we're going to continue the process just as we have in the past. Hopefully we can come to settlements, and if not, we'll go to the hearings then work towards settlements afterwards. We've got plenty of runway to engage ahead of the hearings, and we're always hopeful of settling sooner rather than later.

Okay. In the past, I guess you've expressed a very high level of confidence in your ability to settle this particular case. Is that unchanged, given your comments earlier that the parties still remain pretty far apart?

No, we still have good expectations of being able to settle. I would reiterate as well that we have put a number of issues behind us as we work through the process.

Have you received the counterproposal that was referenced in your regulatory filing from the intervener parties? Judging, I guess, by your comments earlier, you know, it sounds like even if you did receive one, that there are still sort of major issues to be resolved.

No, we haven't. The parties are working on that, and we are continuing the discussions.

Great. I guess it looks as if, to us, as if the Washington utility subsidiary of Berkshire may not be earning at levels that are close to their authorized return levels. Is there something that you plan on doing to potentially narrow the gap between what they're earning and what they're authorized to earn?

Our focus as we move into Washington and look at the opportunities in the state is first, it's a strong operational fit with operations that we know well. We have noted that we expected to be accretive in the first year and to enhance our long-term and the overall business' EPS growth and dividend growth. Much of that is driven by the opportunity for new investment, for clean energy investments in particular that are supporting the Clean Energy Transformation Act compliance obligations that they have. The commissioners have continued to reiterate that for us. We would be expecting to drive to a similar return profile in Washington as we have in Oregon or better.

Yeah. I mean, Paul, you know, the historical gap that we've seen has been mainly related to power costs. You know, one of the attributes that when we do this transaction is a very, it's a very much more specific and transparent direction of costs for the Washington customers. We believe, you know, having this clarity of the Washington utility as well as having a much more specific instead of allocated set of assets and costs there will drive to a more, you know, a more effective recovery over time.

Okay. It's not through merger synergies that you would expect to sort of improve?

No, Paul. To date, when we've talked to and we speak to the accretive nature of this transaction here on the front end and as it relates to getting a better recovery, this is about the execution of the plan, the execution of the cost and the operation of utility. We have not layered in any type of cost synergy or other work here. We've really just layered in an effective operation of and getting, you know, the financing and other benefits of the company. You know, synergies, as I know we've talked to you and that we will work to, but we're not counting on those to make this accretive on that front.

There actually will be synergies on the O&M side and on the power cost side.

Great. Thank you very much.

Thank you. Our next question comes from the line of Travis Miller with Morningstar. Your line is open.

Good morning. Thank you. Got two quick ones and then a follow-up that's a higher level one. Two quick ones. The 26% increase in the data center prices you talked about through the tariff, are those for all existing and prospective customers, or would those be just for prospective data centers?

No, they're for existing and new customers, all data center customers. We worked very collaboratively with each of those customers, and there's no surprises.

Okay. That was my one quick one. The other quick one, the generation mix, Q1 last year to Q1 this year, some changes there in terms of your own generation versus purchased. Was this weather de-driven? Is there something fundamental going on? Anything to read through some of those mixes, particularly in the owned versus purchased?

Yeah, no, there's no strategic changes going on there. I mean, what you'll see is, it's really a combination of events. The weather, you know, the energy pricing related to running assets, as well as certain contracts that will roll on and off. I think you'll see a contract there rolled on under the under the not owned, sorry, or the contracted section. No, overall, our strategy on how we manage the portfolio and the mix of own versus contracted stays on. These are just ebbs and flows in the normal course of a year.

Okay. Makes sense. My higher level question, I think there was a report that called the E3 report that came out in the last couple days. It talked about a 9 GW shortfall by 2030 and a 14 GW-18 GW shortfall by 2035, and particularly along the western edge of the region where you serve and up and down there. Wonder if you could talk to whether you were involved in the report, if these are numbers that are consistent with what you're seeing, with what you've reported to regulators, et cetera.

Sure. The report was commissioned on behalf of industry groups that we participate and know well across the Pacific Northwest. As you know and can see through our 2025 RFP as well as our Integrated Resource Plan, we are working to procure more energy than we certainly have in the past, and there would be others in the region that are doing the same. The report was really focused also on resource adequacy and how we better manage resource adequacy as a region. It includes additional focus on transmission.

Clearly, our entering the energy imbalance market, excuse me, the day-ahead market and building upon our energy imbalance market will improve that for Portland General as well as PacifiCorp, who actually just went live with the day-ahead market today. We appreciate the information that was put together. It's created a lot of regional discussions that are very constructive.

Okay, great. I appreciate all the thoughts. That's all I had.

Thank you.

Thank you. Our next question comes from the line of Ru Jia with Mizuho. Your line is open.

Hi, good morning. This is Ru Jia from Mizuho for Anthony Crowdell. Thank you for taking my question. You've talked about the Washington acquisition as this opportunity to bring a growth-oriented philosophy to a sort of territory that has historically, say, more maintenance-focused. Can you walk us through what that looks like in the first, say, 12 to 18 months after you take over? Perhaps you've already touched on this in previous questions, but just specifically, what are the areas that you'd bring this growth initiative to? What would you point to as early signs that the shift is taking hold? Thank you.

Yeah. Yeah. Good morning, Anthony Crowdell. I'll start here and maybe hand it over to Maria. You know, if when you're talking in the shorter term here, this is really about supporting and giving them the right investment, mainly, you know, mainly on the D side, a little bit of T as it relates to putting, you know, continuing to build that infrastructure at the rate that it needs to support growth. The longer term growth will really come from, as we've mentioned, there are RFPs that we will be involved in and really helping support economic growth and development in a region that we believe is primed for, you know, economic growth and development.

That's why if you, if you look to the charts that we show here on, as it relates to the inclusion of the Washington Utility, you'll see that the growth is a little more, is a little more back-end focused. We give it a little time here to support some industrial growth and then support some of the RFP needs that will go in the areas.

Perfect. Thank you.

You know, we're really encouraged with the regional leaders' interest in accelerating the growth in Eastern Washington and have had terrific conversations with our existing customers as well as with new potential customers.

Okay. Thank you for the answer. Appreciate it.

Thank you.

Thank you.

Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back over to Maria for closing remarks.

Thank you very much for joining us today. We appreciate your interest in Portland General, and we look forward to seeing you at upcoming conferences. Have a great day.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.