Company: POR
Filing Date: 2025-07-25
Form Type: 10-Q
Source: 0000784977-25-000136
Chunk: 40

Company: PORTLAND GENERAL ELECTRIC CO /OR/
Filing Date: 2025-07-25
Form: 10-Q
Item: Part I, Item 1
Chunk 40
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 STATEMENTS, continued(Unaudited)

NOTE 10: INCOME TAXES

Income tax expense for interim periods is based on the estimated annual effective tax rate, which includes tax credits, regulatory flow-through adjustments, and other items, applied to the Company’s year-to-date, pre-tax income. The significant differences between the Federal statutory tax rate and PGE’s effective tax rate are reflected in the following table:Three Months Ended June 30, Six Months Ended June 30, 2025202420252024Federal statutory tax rate21.0 %21.0 %21.0 %21.0 %Federal tax credits*(12.7)(18.5)(10.7)(17.1)State and local taxes, net of federal tax benefit8.2 9.2 8.5 9.1 Flow-through depreciation and cost basis differences(0.1)(0.7)(0.4)(0.6)Reversal of excess deferred income tax(2.3)(2.9)(2.1)(2.7)Executive compensation1.1 0.5 0.9 0.5 Other1.0 0.3 0.1 (0.2)Effective tax rate16.2 %8.9 %17.3 %10.0 %* Federal tax credits primarily consist of production tax credits (PTCs) earned from Company-owned wind-powered generating facilities as well as amortization of investment tax credits (ITCs). PTCs are earned based on a per-kilowatt hour rate and, as a result, the annual amount of PTCs earned will vary based on weather conditions and availability of the facilities. PTCs are earned for 10 years from the in-service dates of the corresponding facilities. PGE’s PTC generation will end at various dates through 2033. The generation of production tax credits from Tucannon River Wind Farm ended in 2024. ITCs are deferred and amortized as a reduction of income tax expense over the estimated useful lives of the related properties.CarryforwardsFederal tax credit carryforwards as of June 30, 2025 and December 31, 2024 were $77 million and $69 million, respectively. These credits primarily consist of PTCs and ITCs, which will expire at various dates through 2045. PGE included anticipated proceeds from the sale of tax credits in determining the