By a News Reporter-Staff News Editor at Energy Weekly News -- Portland General Electric Company (NYSE: POR) reported net income of $105 million, or $1.35 per diluted share, for the year ended Dec. 31, 2013. This compares with $141 million, or $1.87 per diluted share, for 2012. Net income was $47 million, or 59 cents per diluted share, for the fourth quarter of 2013 compared with $28 million, or 38 cents per diluted share, for the comparable period of 2012. The decrease in annual net income was largely due to the write-off of the Cascade Crossing Transmission Project and a customer billing refund in the second quarter of 2013 (49 cents per share) and incremental replacement power costs due to plant outages in the second half of 2013 (13 cents per share).
"In 2013, we completed two RFP processes, which resulted in the selection of three new long-term generation resources that will deliver value to our customers, and achieved a fair outcome in the 2014 general rate case," said Jim Piro, president and chief executive officer. "In 2014, we are focused on constructing the three new generation resources on time and on budget and continually emphasizing operational excellence." Generation projects Construction is underway on all three generation projects selected last year through the competitive RFP processes and each of these projects continue to be on time and on budget. The majority of engines and generators are now on site for Port Westward Unit 2, a 220 megawatt natural gas-fired capacity resource. This plant is needed to help PGE integrate the variable output from wind and solar facilities and meet customer demand for power during peak events such as heat waves or cold fronts. Foundations are being poured and roads are being built at Tucannon River Wind Farm, a 267 megawatt wind farm in Southeastern Washington that will help PGE increase the amount of renewable power in its system and meet state renewable power standards. Construction on Carty Generating Station, a highly-efficient 440 megawatt natural gas-fired baseload plant, began in early January with ground clearing and site development. General rate case filing With Tucannon River and Port Westward Unit 2 expected to begin serving customers in the first half of 2015, PGE has initiated a comprehensive 10-month review and approval process with the Oregon Public Utility Commission in order to include these resources in prices when the plants go online. Late yesterday, PGE filed a general rate case with a 2015 test year requesting an overall customer price increase of 4.6 percent effective early 2015. The rate case requests recovery of incremental costs to bring these two new plants into service and to provide safe, reliable and sustainable power to customers.
The request is based on a return on equity of 10 percent, a capital structure of 50 percent debt and 50 percent equity, and an average rate base of $3.9 billion. The specific impact on individual customers' bills will vary depending on usage and customer class. If the OPUC approves PGE's request as submitted, a typical residential customer using a monthly average of 840 kilowatt-hours of power would see their bill increase by about 5 dollars per month.
PGE expects the Commission to issue a final order with approved price changes before the end of 2014, with new customer prices expected to be effective in three stages. A price reduction for base business costs, resulting from amortization of several customer credits, is expected to be effective on Jan. 1, 2015, and price increases related to each of the two new generation facilities are expected to be effective when each facility is providing service to customers in the first half of 2015. Fourth quarter operating results Total revenues increased $36 million in the fourth quarter of 2013 compared with the fourth quarter of 2012, which was driven by a 6 percent increase in energy deliveries resulting from cooler weather. During the fourth quarter of 2013, heating degree-days (an indicator of the extent to which customers are likely to have used electricity for heating) were 26 percent higher than the fourth quarter of 2012. Residential energy deliveries increased 12 percent and commercial and industrial deliveries combined increased 2 percent. Adjusting for the effects of weather, total retail deliveries in the fourth quarter of 2013 were comparable to the fourth quarter of 2012.
Keywords for this news article include: Oil & Gas, Natural Gas, Wind Energy, Portland General Electric Company.
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