Oregon Utility Sets Five-Year Capex Budget at $6.5 Billion, Embraces ESG

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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--The change in presidential administrations may have made "ESG" (environmental, social and governance) a term of derision inside the Washington, D.C. beltway, but not every company has abandoned those principles or hidden them for political expedience. ESG principles remain front-and-center at Portland General Electric Company (PGE) (NYSE:POR) (Portland, Oregon), which provides electricity to more than 930,000 customers in deep-green Oregon.

"As PGE grows and evolves to meet some of the most pressing challenges of our time, our environmental, social and governance strategy aligned with our core values will continue to guide us to shared success," Kristen Sheeran, the utility's vice president for policy and resource planning, wrote in the utility's 2024 ESG report, "Advancing toward a clean energy future." She added: "Our commitment to customers, to environmental stewardship, to employees and their communities, to ethical conduct, transparency and sound governance has never wavered."

The ESG report touts PGE's "holistic approach (that) reflects our company's core values of service, accountability, affordability and sustainability and balances environmental, social and governance goals with our core mission to power Oregon's economy and communities. This is underscored by our commitment to deliver long-term results for our stakeholders, including our customers, shareholders and communities."

The utility has demonstrated that in recent years by bringing on a 311-megawatt (MW) windfarm in eastern Montana, called Clearwater, and a 200-MW battery energy storage system (BESS), called Troutdale. Work is nearly complete at a second 200-MW BESS, Seaside, which is scheduled to be operating later this year.

These investments have been made to pursue the utility's goal of reducing its greenhouse gas emissions by at least 80% by 2030 and 100% by 2040.

PGE, which announced first-quarter results April 25, told investors it plans to make capital investments totaling about $6.5 billion over the 2025-2029 period. Slightly less than half of those planned capital outlays, about $3 billion, are slated to go to the utility's distribution business. Outlays for transmission are expected to rise steadily throughout the five-year period, reaching about $515 million in 2029 from about $240 in 2025.

Click on the image at right to see PGE's planned capital budget for 2025-2029.

The utility's current five-year capex plan is slightly higher than the year-earlier plan, which totaled approximately $6.2 billion, but about 35% higher than the capex plan for 2023-2027.

Industrial Info is tracking 17 PGE capital projects totaling about $588 million. For a complete list of the utility's planned capital outlays, subscribers to Industrial Info's Global Market Intelligence (GM) Power Project Database can click here. More than half of the capital projects tracked by IIR is PGE's plan to build a BESS at a substation in Northwestern Oregon, at a projected cost of $355 million. That project is in the engineering stage right now. Mortenson Construction (Minneapolis, Minnesota) is providing engineering, procurement and construction (EPC) services for this project. Subscribers can learn more by viewing the project report.

Last year, Intel Corporation (NASDAQ:INTC) (Santa Clara, California) announced it would invest more than $36 billion in PGE's service area in northwestern Oregon, mainly to build new computer chipmaking fabrication facilities. Despite experiencing market reversals, the chipmaker recently confirmed its plans for the Hillsboro area.

For the just-completed first quarter, PGE earned $100 million on revenue of $928 million, down from earnings of $109 million on sales of $929 million for the comparable year-earlier quarter. The company said it experienced strong energy demand from high-tech and data centers in the just-completed period, which drove total quarter-over-quarter load growth of 4.6%. Industrial load growth clocked in at 16.4% over first-quarter 2024 results.

PGE added that revenue from semiconductor manufacturing and technology infrastructure customers rose in the just-completed period, but operating and maintenance and administrative expenses increased due in part to wildfire mitigation and vegetation management efforts.

"This quarter, PGE advanced key priorities as we served growing customer demand, engaged on important wildfire policy and worked to thoughtfully streamline our operations," Maria Pope, PGE president and chief executive officer said in releasing earnings April 25. "We are laying the foundation for solid results, diligent cost management and strong execution in 2025 and beyond."

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).