Good morning, everyone, and welcome to Portland General Electric Company's Second Quarter 2021 Earnings Results Conference Call. Today is Friday, July 30, 2021. This call is being recorded and as such all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. For opening remarks, I will turn the conference call over to Portland General Electric's Senior Director of Investor Relations, Treasury and Risk Management, Jardon Jaramillo. Please go ahead, sir.

Thank you, Chelsea. Good morning, everyone. I'm pleased that you're able to join us today. Before we begin this morning, I'd like to remind you that we have prepared a presentation to supplement our discussion, which we'll be referencing throughout the call. The slides are available on our website at investors.portlandgeneral.com. Referring to Slide 2, 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 earnings press release and our most recent periodic reports on Forms 10-K and 10-Q, which are available on our website. Leading our discussion today are Maria Pope, President and CEO; and Jim Ajello, Senior Vice President of Finance, CFO and Treasurer. Following their prepared remarks, we will open the line for your questions. Now it's my pleasure to turn the call over to Maria.

Good morning and thank you all for joining us. The June heat wave and a rebounding economy tells us a story for the quarter. Turning to Slide 4, we've reported net income of $32 million or $0.36 per diluted share for the second quarter of 2021. This compares with net income of $39 million or $0.43 for the second quarter of 2020. In light of economic growth and the accelerated recovery, we are revising our earnings guidance to $2.70 to $2.85 per diluted share up from $2.55 to $2.70, and are reaffirming our 4% to 6% long-term earnings growth guidance. Total revenues increased 14% as a result of higher retail energy deliveries, as well as higher energy usage during the recent heat wave. To meet this greater demand, we purchased additional power at high prices compounded by low hydro and wind conditions across the region. Operating expenses increased driven by investment in resiliency in advance of the wildfire season, as well as higher administrative and other expenses. Later in the call, Jim will review second quarter results in more detail. He will also provide regulatory and capital updates as well as discuss the outlook for the rest of the year. For the third time within the last 12 months, we have experienced unprecedented weather events. In late June, a historic heat wave caused temperatures to soar to 116 degrees. Record heat was not only unique in its intensity but also in duration. On the hottest day, we served a record load of 4,441 megawatts compared to the previous record of just over 4,000 megawatts, more than two decades ago. Through it all, and thanks to the dedication of our co-workers and ongoing investments in generation, grid infrastructure, improved work management processes, as well as disaster preparation and training, we maintained strong reliability.

Thanks, Maria. This has certainly been a year of unprecedented weather events, which further underscores the impacts of climate change on our business, but also highlights how the investments we’re making position us to tackle the challenges ahead. I'll begin this morning with commentary on the economy and load growth. Oregon's economy continues to recover as we emerge from the pandemic and is showing signs of vitality once again. As of July 27th, approximately 68% of eligible Oregonians have had at least one vaccine shot, and at the end of June, Oregon fully reopened and safety protocols were lifted. The Oregon economic and revenue forecast in May of 2021 stated, and I quote, "the outlook for near-term economic growth is the strongest in decades, if not generations." Through June, unemployment in the Tri-County Portland area was 5.6%, an improvement from just over 6% in the first quarter. We continue to see growth in high tech and digital services with commercial recovery taking place at a brisk pace. The recovery of the commercial segment was a contributor to our strong year-over-year load growth.

Your first question comes from the line of Insoo Kim with Goldman Sachs.

Hello, Insoo.

Hey, Maria. How are you guys? My first question here is for Jim, just on the financial side. I want to understand the raising of the guidance here. Is it just a combination of – I know you’ve had some tax benefits in the first quarter from the timing of regulatory items as well as the higher demand that you’ve experienced, which I'm assuming is above what you had forecasted? I know part of that demand is decoupled, but given the robust industrial demand, is this all making into, like what gives you the confidence of the high range?

Yes. Thanks, Insoo. I think you’ve got the right trend here. So we did have the benefit in the first quarter of $0.09 as it were. So that was off the midpoint of about $2.63, $2.64, what I’ll call the prior guidance. Plus we looked at this additional demand and took that into account, obviously offsetting that there are some headwinds with additional O&M expenses that we just talked about. So net-net, we’ve done a lot of sensitivities around this, so there are some puts and takes, but we’re comfortable in this new range. I think you’ve covered it pretty well.

Got it. And related to that, when we think about 2022, obviously there are a lot of moving parts. There’s the operating rate case, which will play out sometime in 2022 and just given some of the increased O&M that you’re doing this year to increase reliability, I’m just wondering about your thoughts on that 2022 earnings power. With that 4% to 6% growth off of the 2019 EPS, do you still feel like that’s the right way to think about it, given the different types of outcomes that could come out of the vacation and different operating expense items?

Yes. I think we need to see a little more line of sight into 2022 before we discuss that guidance range, which we’ll do in February of that year. So you’re quite right. O&M is a factor; you’ve hit another important point. I will note that even though we have just raised the guidance on O&M for very good reasons, if you look back at where we were in 2019, I expect this year’s O&M to come in at that same level two to three years later. So I think we’ve got strong performance in O&M. We’ve got different challenges, obviously in the grid and with weather. But we’re holding our own in terms of keeping O&M at reasonable levels, and it’s almost spot on to where it would be, if I’m right about this year in terms of 2019. So I feel pretty good about that actually.

Got it. And just one more, if I could. Maria, it seems like over the past few quarters, every time we’ve had this call, there’s been another unprecedented natural event that’s happened. Hopefully, it’s not a normal type of event. But if this proves to be a bit more frequent, or if that’s maybe the broad expectations, are you having conversations with the stakeholders on what type of maybe lower hanging fruit type of investments that you as the utility could make even more than above and beyond what you’re already doing for reliability? You’ve mentioned some undergrounding and whatnot, but just curious on your general thought there.

Sure. We work with stakeholders and really firefighter professionals, people who are first responders, disaster recovery specialists and others; we look at a variety of risks. And even those that we haven’t experienced, which seems hard to believe given the last 12 months that we’ve had. And with each one of our crises that we’ve had, we’ve emerged stronger. We’ve taken the learnings and reflected them immediately in our planning and how we do our work. We still have much work to do, and we will continue to assess the risks as we move forward and work collaboratively as well as with regulators.

Understood. Thank you so much.

Thank you.

Your next question comes from the line of Julien Dumoulin-Smith with Bank of America.

Good morning. Can you hear me?

Yes.

Excellent. Congratulations on the outcomes here. Truly exceptional. In fact, to that end, and I’m using the word exceptional on purpose, I’m trying to understand what your level of confidence is here, as you think about this low growth trend not just throughout the back out of this year because clearly your guidance range insinuates that. But rather more structurally, I mean, it’s – obviously your service territory fits in a really special place outside of California, et cetera. And certainly, we’ve seen some of your neighbors pointing to very exceptional low growth trends themselves just yesterday. So I’m just curious how you think about this on a sort of a multi-year basis and how does that sort of accrue to the business from a CapEx and from a rate affordability perspective, etc. Just thinking about sort of the bigger picture consequences.

So, Julien, first of all, thank you. And second, we’ve been talking for a couple of years about the robust nature of our service territory. We are very fortunate to operate and to serve an area where people want to be, where they are expanding their businesses, particularly in digital and high tech, where we see people interested in moving to. So we’re very fortunate to have the opportunity to serve the additional growth as well as invest in enhanced reliability and resiliency. And I would also note that Oregonians are very clear about wanting a clean energy future. And that was central to some of the legislation that was just passed this session, which in many instances is not too different from our own goals as a company but further demonstrates the interest in a clean energy future within the state and the region.

Got it. Excellent. And then can we speak a little bit to the backdrop on this rate case and the ability to resolve these issues in a more settlement type fashion? I’m just curious, I know we’re early; this is an evidentiary question. But obviously, especially considering the low growth and your cost management efforts, I suspect that certainly some of the sharper considerations around any case.

So, as you know, we have a traditional history of collaboration and settling our rate cases. We work hand in glove with our interveners and with stakeholders, not just in rate case processes but in many other dockets. We felt very strongly going into this rate case that we still have, while things feel very robust, much of our economy is still fragile and there are still many that are impacted by COVID and are still struggling. So we worked very hard to keep our price increases as affordable and as low as possible and also to keep the number of issues down. We have a lot of issues that have strategic importance in front of our commission. And so we really focused on a couple of mechanisms: decoupling and our outage restoration mechanism and then really on planning for the future with regards to Colstrip and exiting any generation of coal that we’re associated with. Let me let Jim spend a little bit more time on that because that’s an important component here.

So, yesterday we entered into a nearly unanimous settlement agreement regarding our depreciation study, which was filed earlier in the year with the exception of one party we filed with the PUC. Our new depreciation study agreement will come into rates, of course, in this 2022 case. One of the important features is the accelerated depreciation of the Colstrip expense to 2025, so we’ve already, I think, demonstrated in an important way related to this case. And of course, the future and our desire to exit any of the coal investments here that we have in Colstrip at a much earlier date. So I think that’s an important development. It’s really the first development we can talk about regarding this case, Julien, if you caught that one.

Got it. And I’m sorry to squeeze in another one. You’ve got a lot going on here and it really comes back to, when can we be in a position to review this growth rate on a more comprehensive basis? I mean, you’ve clearly seen your peers across the West Coast ramp up their spending and mitigation efforts on wildfires at the same time resource adequacy is perhaps as acute and as concerning as we've seen in several decades, and hydro is no exception to this. You all have resource procurement underway as it stands already. I mean, myriad facts that are in consideration; although the timing is important. Ultimately, if I were to summarize that, how and when do we get sort of an integrated and comprehensive view on spending and earnings growth?

Yes, I think you're hitting on a very important topic. We'll look at this rate of growth towards the end of the year as we prepare for 2022. I think you've already identified one of the important variables, which is growth. For me, we've got to watch this transition out of COVID-19 into a regular economy. The residential load is probably going to dip a little bit. Commercial load is increasing as a transitional matter; that was the sector of the economy that was hit the hardest. And then I think you and Insoo probably referred to something that I think is really important, which is the structural sustaining of value and growth of our industrial load. I think that is here to stay and is growing very rapidly. This composite should allow us to look at the future a little differently, perhaps think about growth a little differently, perhaps think about CapEx a little differently, which translates to growth in this business. So that's on the table—not today because we're watching a transition out of the pandemic and observing very volatile load numbers, very volatile weather conditions. We're going to take all that into account towards the end of the year and talk more fully about that in February. But I'm frankly very pleased with the growth that we've got. We just have to manage the grid and these volatile weather conditions. There are puts and takes there. There are some tailwinds and headwinds against your question here. So if you could be patient, we'll sort this out.

Excellent. I wish you the best of luck.

Thank you.

Thanks, Julien.

Your next question comes from the line of Peter Bourdon with Mizuho Securities.

Hi, thanks for taking my question.

Thank you.

Sure. So just a follow-up on that; in regard to the rate case that was filed, is that reflective of the updated kind of growth view or is that more of the 1% long-term view?

It reflects the best information that we have. I would say that what Jim noted was a tremendous amount of volatility and probably of unprecedented nature. One of the other things that's coming to us is higher inflation clearly both on the wage side as well as the material side. We are managing through a complex supply chain with no implications to our operations. But clearly, there are a number of other issues in front of us that we're all dealing with as we move forward.

Let me add, Peter. So just without getting too detailed, the case was filed based on a load forecast, as Maria said, the best we had in hand in the March timeframe. What is normal in these cases and what will happen here is we will update that load forecast in the September timeframe as discussions proceed with the regulator and the intervener. So there is a bit of a catch up there, and so that is infused into the case as it sort of picks up momentum for discussions.

Okay. Thank you. That certainly helps. And then just to clarify, Jim, the first quarter $0.09 tax benefit that you had mentioned; that is included in the updated guidance?

That is correct.

Okay, thank you.

Sure.

Your next question comes from the line of Sophie Karp with KeyBanc.

Hi, good morning. Congrats on a good quarter. Thank you for taking my question. I was curious if you could give us a little more color on the volume growth here. So, clearly, it's been a very strong quarter, but do you have a sense of how much of that is coming from in-account growth, people moving in, and/or businesses, as opposed to just cyclicality bound off of COVID disruptions last year?

Yes, so, Sophie, thank you and good morning. So yes, this is a little bit hard to parse right now, right? Because what we cite are numbers in our gross; and of course, weather-adjusted deliveries increased 8%. I haven't seen that in this jurisdiction. Of course, I'm fairly new to it, but historically speaking, that's quite high. We’ve got, I would say, a lot of industrial growth that’s coming in. I think we’re also the third largest region in terms of in-migration of residential folks. And our commercial—as I said a moment ago to Peter—is rebounding rapidly, but in terms of a net growth, it's hard to pin that right now.

Got it. But do you expect that at some point you will be able to kind of do any of the data and maybe update the long-term forecast of growth to reflect that, so we can extrapolate something? Or how do you think about that?

Absolutely, Sophie. And what will be important is we put a few more quarters under us; we'll be able to see true trends. When you get into extreme tail events like we have been experiencing, you don't have a lot of data to rely upon. And so it’s helpful to put a few more quarters behind us in terms of what we're seeing in terms of digital high-tech growth in migration. Jim noted what is really going to happen with a commercial versus residential, I think, is still to be determined. So far the trends are looking good, but it's too early to call.

Yes. Sophie, just to maybe highlight one other point; it's a pretty volatile situation at the moment given the transition in the economy. I saw this at the end of June, when April and May were steaming along quite well in terms of earnings expectations, and we hit June. We had to enter into the market, as I said earlier, to purchase additional power resources, and we had some distribution work in the field, which caused June to be a very different month than we even expected. So I'm just referring back one month and sort of signaling that the quarter could have been considerably better, but for the volatility of weather in the power procurement and the distribution work we had to do in the field, which is all necessary. It's our job one; all higher priority, but it shows you how volatile this could be. So we'll—as Maria said—want to see a little more time and some more results before we can look to the longer trends, but we'll update you.

Got you, got you. Thank you. And then maybe on guidance and sort of your rating guidance and—this rate. But with that said, we kind of go into the peak wildfire season in August and September as you also noted. I guess, as it relates to this particular situation, what would be something or some items to watch as a choice that relates to your guidance?

Well, I mean, I would only answer it this way. When we calculate the guidance, we obviously take into account some of the recent learnings we have. So I can tell you that we build in sensitivities for additional costs, power costs, other costs on the O&M side and the like in terms of anticipating this. We can't accurately calculate what will happen with the weather, but I will tell you that the new guidance reflects sensitivities. We have four events out of our control, let's put it that way. So there is—embedded in our guidance—this notion of the weather volatility and the additional power costs and O&M expense that could occur as a result.

All right. So let's say if we had a fairly quiet wildfire season, then it will be a potential for the upside to your numbers because you baked in some contingency for that?

Well, I would say to you that the top of our range contemplates that.

Your next question comes from the line of David Peters with Wolfe Research.

Yes, hi. Good morning, guys.

Hi, David.

I was just wondering if you could maybe provide some additional color on the recent clean energy legislation that was signed. I know this was in line with your goals as a company, but are there areas that you think could lead to incremental kind of investment opportunities versus the plan that you currently have outlined and just what processes would you need to work through before you maybe see some of that come to fruition?

Sure. It was an extensive legislative focus on clean energy, on the grid, on reliability, and resiliency overall. As you look at really the headline, it is an 80% reduction in greenhouse gases by 2030, and 90% by 2035, and 100% by 2040. Obviously, that latter part is more aspirational, dependent upon technological innovation. But I think it's important that this knowledge aligns with Portland General’s strategy for some time. So we'll be working collectively with regulators and with stakeholders as we accelerate our clean energy future. In addition, we cleaned up some language that dates back to restructuring laws from 1999 and some other things like that. It also includes a strong focus on environmental justice and community support provisions. We also saw an expansion of the community green tariff. We've had a community green tariff in place for a while, and this allows us to expand our programs to customers who are interested in going further and faster with 100% clean energy sooner than the dates I just gave you. We worked collaboratively with many cities and others to get this done. I would also note transportation electrification. As you know, Oregon is a leader in transportation electrification. It was one of the centerpieces of Governor Kate Brown’s tenure leading the Western Governors this past year. And we will be—we’re now enabled through this legislation to do more in terms of infrastructure up to and behind the meter, so really enabling a faster transition to a clean transportation sector. And then finally, there are issues around the public purchase charge, which traditionally supported the number one energy efficiency program in the country through the energy trust of Oregon and the good work that they do making some adjustments. But most importantly, extending that to 2035 versus its prior expiration of 2025. I would say that it's inclusive, it's comprehensive. It makes sure that we are focused on all parts of our community, in particular, those who have traditionally been left behind as we move to a clean energy future. We are very pleased with how things turned out and more importantly, the relationships and partnerships built in the ongoing dialogue. We’re probably just in the beginning of that and have much to learn.

David, just to cap that off, this sets the table very well for the execution of our strategy for us to now step back and figure out how we want to cost out and provide new products and implement them. So we're really pleased by the shape of it, the comprehensive nature of it. But now we're at the point where we can say, how do we execute and what sort of investments do we want to make against that? We're just at that beginning stage.

Great. Thank you. And then Maria, I know you testified on behalf of the Senator Wyden bill initially; just curious, has there been any movement on that front recently or anything you could share?

I think there’s terrific conversation going on. I think there’s lots of movement. I'm not going to forecast at all. But key to that legislation is our normalization provisions that will level the playing field between regulated utilities and others, to be able to adequately recognize investment tax credits for the benefit of customers and accelerate a clean energy future, bringing additional participants to the table. I think really changing the face of how we think of energy going forward.

And I think it's probably obvious to say it. I'll say it anyway. This could be meaningful in terms of the way that we implement or respond to the RFP that we're anticipating in November. So we're really hoping that this moves forward in Maria's leadership and this with Senator and others in the industry are hopeful.

Great, thank you guys.

Your next question comes from Brian Russo with Sidoti.

Yes, good morning. Most of my questions have been asked and answered. But on the transport electrification bill and strategy that you're pursuing in front and behind the meter, can you give us some examples? Are you referring to EV charging stations within your service territory, or you're just talking about the need for new substations to deliver more electricity to various areas to support EV?

Yes. All of the above. So it will be expanding and making our system more robust. It will be additional cabling and infrastructure to get to charging stations, and it will be charging stations in and of themselves. So it is a broad piece of legislation that really will enable us to help the transition to the transportation sector, which we know is the largest emitter of greenhouse gases in our economy to more rapidly expanding into the electric sector and being more efficient and cleaner.

Hey, Brian, even before this legislation was implemented recently, we've been in discussions. We have a dedicated team, a very good team been in discussions with various fleet owners, looking at larger rollouts on their behalf. I think as you would probably know as well that the C&I sector moves very quickly on these opportunities. We're very active in that space right now. We have nothing to announce, but I think that this is going to be an interesting opportunity. This will be a place also where in the future years we'll allocate increasing amounts of capital to this kind of segment. I think it could be a very important strategy for us and really a game changer over the longer term.

Right. My follow-up was going to be, I suppose there’s very little CapEx involved in EV right now. And I was just curious to know what type of dollar opportunity of investment this could be, especially with the Governor’s support, and then any time frame in which that might occur.

Yes, we're sizing that right now. It’s not something that we'll roll out today, but increasingly we’ll talk more about that as we do more make-ready work at the backbone of the system ready as we do fleet transactions. You’ll hear more and more from us on that.

There's some really nice synergies as we do this work and invest in the system for transportation because it makes our regular business serving customers, homes, businesses, and industry that much more reliable and updates equipment and infrastructure. Also, as we move to being able to use battery stores to support the stability of the grid with bi-directional charging, that will be very, very helpful to the overall reliability of the system as we bring on increasing amounts of renewable.

And not to belabor the point, but I would also add that while 63 megawatts showed up with demand resources here in the most recent heat event, I think that connecting the dots, as we roll out more TE and use the battery systems out there increasingly, we want to dramatically increase our DERs and transportation electrification is going to be one of those strategies that will be symbiotic with that.

Great. And then just a clarification; when we look at the second half of the year, just per disclosures in the 10-Q. As of June, in terms of net variable power costs and the PCAM, you're $6 million above. But I think the forward look for the end of the year is that you're going to be below the dead man, but within the sharing. So that implies some meaningful swing in favor of power costs in the second half of the year; is that the way to look at it?

I think directionally you're correct. I see it the same way. So there's a benefit there. I get the same $6 million above the baseline. So I think you've sized it correctly.

So is the midpoint of your guidance—does it assume zero balance, neither benefit nor adverse for power costs?

Yes, I would say that's about right, within certain minor degrees of difference. Yes.

And I would say what we're really looking at is a change in margin. So you may have higher power costs, but we may also have higher revenue. We may have lower power costs, we may have lower revenue. So I think we're beginning to look at this differently given the volatility of the weather events that we've seen and likely we'll continue to see. As Julien noted, resource adequacy issues remain significant for the Pacific Northwest and the entire west. We're just in a period of transition and a lot more volatility.

Got it. Understood. Thank you very much.

Thank you.

Your next question comes from Andrew Levi with HITE Hedge.

Hey guys, can you hear me?

Yes, Andy.

Good. Okay. I just wanted to make sure of that. Couple of questions. I mean, a lot of it has kind of been touched on, but I guess, well, my first question is really around the service territory and more, stuff that you've touched on as far as the economy is concerned. So it seems like you're in a very unique situation within our industry and probably maybe the best service territory within the continental 48. So can you maybe touch on what the opportunities are around, kind of looking at that the fact that you have a lot of purchase power; you will also have needs for growth on top of that, and you have Colstrip as well. So I know you're going to file this plan later in the year. But can you kind of give us an idea if this growth continues how your plans may change for the upside?

So Andy, given the year that we've had, yes, I think I got it. I think given the year that we've been through; we've learned a whole new appreciation for the word agility. And I would say, if we look at our RFP it's for 150 average megawatts and then a capacity need of 287. As we look going forward, clearly we're in a period of transition and we will work collaboratively with all the stakeholders to ensure that we continue to support and have energy for a stable and reliable grid. It will take a variety of different kinds of investments. When I think of what it's going to take for a clean energy future, a stable, affordable grid; it's really going to take on all of the above set of solutions. Our ability to integrate renewables or innovate distribute energy resources, to work collaboratively with our customers particularly those who have flexible load options and to be able to deliver value in the unique ways that each of our customers want and need for their businesses, for their residences, it's a tremendous opportunity and we're fortunate. We've been talking a long time about the growth that's coming, and it's nice to see it arrive.

Andy, I would say that Maria is really referring to the next tranche, right? The 150 to 287. But to fulfill our goals in terms of decarbonization and the like, we're going to see a lot more growth renewables in this region. So I think beyond the 2024, 2025 delivery, I look beyond this to new IRPs that will add many, many hundreds more megawatts of renewable power as we go. We do see an exit from Colstrip, right? As I mentioned earlier, the 2025 depreciation has been filed and I'm hopeful about that. So I see a strong transition here, and I see a lot more renewables coming on to accommodate this growth. I'm looking – I'm looking towards the end of the decade, not just this next tranche of opportunities; and I'm seeing sustained growth as you and Julien have pointed out, and that sustained growth will require that we add more resources to the system. We have many more distributed energy resources; the transportation electrification is only going to increase the growth opportunities that we now have. So it's a very positive outlook for resources and growth as I look down the line.

And then I have a follow-up also Jim, Maria. The beauty of it is that top-line growth and that growth within the service territory also helps offset the need for rate increases. Not rate increases period, but obviously softens that? And then...

You're absolutely right. Andy, just on that point, I think it's really important that we recognize that our ability to continue to serve customers and be their energy provider does have a synergistic impact on all customers and our ability to invest in reliability and resiliency of the system.

And then the other opportunity I see in people, kind of tend to look at the wildfires down in Southern Oregon as a risk. But I guess I kind of, you pointed out obviously your service territory is different and people should take a close look at that and that's very important. But also, I view what's happening in Southern Oregon and, more importantly, what's happening in California as a large opportunity for you as a company and for your customers to get a more reliable system. So as Oregon grows and as the Portland area grows, the reliability around your grid is going to – it's always important, but obviously to keep that growth growing that grid needs to be reliable and available. To depend on power that's being imported from California and other parts of the state; have you guys kind of talked about with whether it's with the regulators or just internally and with other people, power brokers? It's been a better way to put it, no pun intended. Within the state of Oregon, that some of this, whether it's renewable generation or whatever you end up installing; that a lot of that has to be done around the load centers and in a sense to take away that fire risk as far as supply as we saw, you know, in the June – in the June event?

So, Andy, what you've just articulated is core to our strategy around our integrated operations center, which is to be able to manage more distributed generation resources. As technology develops, we will increasingly include battery storage as well as others to make our system more reliable, more resilient. So you're absolutely correct. Overall, as a company, we have an expression that we never let a good crisis go to waste. Never would we have thought that when we came up with that term going into the pandemic that we would see so many crises over the past 12 months. I can tell you we've become—we've emerged stronger out of every event that we've dealt with. We've come together as a company and as a team and worked collaboratively with our partners; community leaders, our customers, first responders, and people who really care about this region, Oregon and its future.

Got it. And then my last question is just really around dividend policy. When do we get a kind of an update on that? And I guess maybe that kind of goes lock step in any update we may get; whether it's after the rate case or fourth quarter call or whatever it may be when we get to become the CapEx refresh – the growth rate refresh, I assume there'll be some type of look; assuming things are positive, look at the dividend policy as well?

Yes. I would add to your question that what's pending here is to look at our growth rate and to look at our dividend. I think we provide a very competitive dividend today. We've been at a CAGR of 5.5% over multiple years now. You saw the dividend from yesterday's announcement. I see that we at the quarter—we were at a dividend payout ratio—call it 60%, 61%. So we're clearly in a pretty strong position there. It does important depending on the rate case and a few other factors. But growing the dividend here, as I see it, is absolutely going to be a steady affair for us, I think, for the future, but exactly how much it will be around that 5.5% average CAGR that we've been experiencing is yet to be determined. So I think the dividend is an important part of our total return to shareholders, and we expect to carry on that way.

Okay. Thank you guys very much, and go Trail Blazers for next year.

Okay.

Yes. Thank you. And thank you all for joining us today. We appreciate your interest in our company, and we hope to connect with you in the near future, and at the very least, we'll see you next quarter. Thank you.

This concludes today's conference call. Thank you for participating. You may now disconnect.