UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM _______ TO _______
COMMISSION FILE NUMBER 1-5532-99
PORTLAND GENERAL ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
OREGON (State or other jurisdiction 93-0256820
ofincorporation or organization) (I.R.S. Employer
Identification No.)
121 SW SALMON STREET, PORTLAND, OREGON 97204
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (503) 464-8000
Securities registered pursuant to Section 12(b) of the Act:
NAME OF EACH EXCHANGE
TITLE OF EACH CLASS ON WHICH REGISTERED
Portland General Electric Company
8.25% Quarterly Income Debt Securities
(Junior Subordinated Deferrable Interest
Debentures, Series A) New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act:
TITLE OF CLASS
Portland General Electric Company,
7.75% Series, Cumulative Preferred Stock,
no par value None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No .
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. [ X ]
State the aggregate market value of the voting stock held by non-affiliates of
the registrant as of February 29, 2000: $0.
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of February 29, 2000: 42,758,877 shares of Common Stock,
$3.75 par value. (All shares are owned by Enron Corp.)
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY
FORM 10-K/A
AMENDMENT 1
The undersigned registrant hereby amends Item 8, Financial Statements and
Supplementary Data, and Item 14, Exhibits, Financial Statement Schedules and
Reports on Form 8-K, of its Annual Report for 1999 on Form 10-K as set forth in
the pages attached hereto. In Item 8, the following modifications have been
made: 1) on the Consolidated Statements of Cash Flow on page 38 of Form 10-K,
Cash Flows from Operating Activities, Other non-cash expenses for 1999,
currently printed as "24" should be replaced by "-"; all totals and sub-totals
within the Statement remain unchanged; and, 2) in Notes to Financial State-
ments, Note 5, Credit Facilities and Debt, on page 48 of Form 10-K, First
Mortgage Bonds Maturing "2005-2008" should read "2005-2007", and the sub-total
of Other long-term debt at December 31, 1998, currently printed as "143" should
be replaced by "144"; all other amounts within the Note, including totals and
sub-totals, remain unchanged. In Item 14 on page 69 of Form 10-K, Exhibit (23),
Consents of Experts and Counsel, has been added and filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
March 9, 2000 By /s/ Mary K. Turina
Mary K. Turina
Vice President, Finance
Chief Financial Officer
and Treasurer
<PAGE>
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING
The following financial statements of Portland General Electric Company and
subsidiaries (collectively, PGE) were prepared by management, which is
responsible for their integrity and objectivity. The statements have been
prepared in conformity with generally accepted accounting principles and
necessarily include some amounts that are based on the best estimates and
judgments of management.
The system of internal controls of PGE is designed to provide reasonable
assurance as to the reliability of financial statements and the protection
of assets from unauthorized acquisition, use or disposition. This system
is augmented by written policies and guidelines and the careful selection
and training of qualified personnel. It should be recognized, however,
that there are inherent limitations in the effectiveness of any system of
internal control. Accordingly, even an effective internal control system
can provide only reasonable assurance with respect to the preparation of
reliable financial statements and safeguarding of assets. Further, because
of changes in conditions, internal control system effectiveness may vary
over time.
PGE assessed its internal control system as of December 31, 1999, 1998 and
1997, relative to current standards of control criteria. Based upon this
assessment, management believes that its system of internal controls was
adequate during the periods to provide reasonable assurance as to the
reliability of financial statements and the protection of assets against
unauthorized acquisition, use or disposition.
Arthur Andersen LLP was engaged to audit the financial statements of PGE
and issue reports thereon. Their audits included developing an overall
understanding of PGE's accounting systems, procedures and internal controls
and conducting tests and other auditing procedures sufficient to support
their opinion on the financial statements. Arthur Andersen LLP was also
engaged to examine and report on management's assertion about the
effectiveness of PGE's system of internal controls over financial reporting
and the protection of assets against unauthorized acquisition, use or
disposition. The Reports of Independent Public Accountants appear in this
Annual Report.
The adequacy of PGE's financial controls and the accounting principles
employed in financial reporting are under the general oversight of the
Audit Committee of Enron's Board of Directors. No member of this committee
is an officer or employee of Enron or PGE. The independent public
accountants have direct access to the Audit Committee, and they meet with
the committee from time to time, with and without financial management
present, to discuss accounting, auditing and financial reporting matters.
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders of Portland General Electric
Company:
We have examined management's assertion that the system of internal control
of Portland General Electric Company and its subsidiaries as of December
31, 1999, 1998 and 1997, was adequate to provide reasonable assurance as to
the reliability of financial statements and the protection of assets
against unauthorized acquisition, use or disposition, included in the
accompanying report on Management's Responsibility for Financial Reporting.
Management is responsible for maintaining effective internal control over
the reliability of the financial statements and the protection of assets
against unauthorized acquisition, use or disposition. Our responsibility
is to express an opinion on management's assertion based on our
examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly,
included obtaining an understanding of the system of internal control over
financial reporting and the protection of assets against unauthorized
acquisition, use or disposition, testing and evaluating the design and
operating effectiveness of the system of internal control and such other
procedures as we considered necessary in the circumstances. We believe that
our examination provides a reasonable basis for our opinion.
Because of inherent limitations in any system of internal control, errors
or irregularities may occur and not be detected. Also, projections of any
evaluation of the system of internal control to future periods are subject
to the risk that the system of internal control may become inadequate
because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
In our opinion, management's assertion that the system of internal control
of Portland General Electric Company and its subsidiaries as of December
31, 1999, 1998, and 1997 was adequate to provide reasonable assurance as to
the reliability of financial statements and the protection of assets
against unauthorized acquisition, use or disposition is fairly stated, in
all material respects, based upon current standards of control criteria.
Arthur Andersen LLP
Portland, Oregon
February 29, 2000
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders of Portland General Electric
Company:
We have audited the accompanying consolidated balance sheets of Portland
General Electric Company (an Oregon corporation), and subsidiaries as of
December 31, 1999 and 1998, and the related consolidated statements of
income, retained earnings and cash flow for each of the three years in the
period ended December 31, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Portland General
Electric Company and subsidiaries as of December 31, 1999 and 1998, and the
results of their operations and their cash flows for each of the three
years in the period ended December 31, 1999, in conformity with accounting
principles generally accepted in the United States.
Arthur Andersen LLP
Portland, Oregon
February 29, 2000
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED DECEMBER 31 1999 1998 1997
(MILLIONS OF DOLLARS)
OPERATING REVENUES $ 1,378 $ 1,176 $ 1,416
OPERATING EXPENSES
Purchased power and fuel 638 441 675
Production and distribution 135 134 132
Administrative and other 115 114 107
Depreciation and amortization 155 149 155
Taxes other than income taxes 61 57 56
Income taxes 84 81 83
1,188 976 1,208
NET OPERATING INCOME 190 200 208
OTHER INCOME (DEDUCTIONS)
Miscellaneous 13 13 (21)
Income taxes (6) (1) 13
7 12 (8)
INTEREST CHARGES
Interest on long-term debt and 61 68 69
other
Interest on short-term borrowings 8 7 5
69 75 74
NET INCOME 128 137 126
PREFERRED DIVIDEND REQUIREMENT 2 2 2
INCOME AVAILABLE FOR COMMON STOCK $ 126 $ 135 $ 124
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
FOR THE YEARS ENDED DECEMBER 31 1999 1998 1997
(MILLIONS OF DOLLARS)
BALANCE AT BEGINNING OF YEAR $ 356 $ 270 $ 292
NET INCOME 128 137 126
MISCELLANEOUS - - (2)
484 407 416
DIVIDENDS DECLARED
Common stock - cash 81 49 47
Common stock - property - - 97
Preferred stock 2 2 2
83 51 146
BALANCE AT END OF YEAR $ 401 $ 356 $ 270
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
AT DECEMBER 31 1999 1998
(MILLIONS OF DOLLARS)
ASSETS
ELECTRIC UTILITY PLANT - ORIGINAL COST
Utility plant (includes Construction work
in progress of $44 and $35) $ 3,295 $ 3,182
Accumulated depreciation (1,430) (1,363)
1,865 1,819
OTHER PROPERTY AND INVESTMENTS
Contract termination receivable 85 95
Receivable from parent 89 97
Nuclear decommissioning trust, at market
value 42 72
Corporate owned life isurance, less loans
of $0 and $32 85 63
Miscellaneous 17 15
318 342
CURRENT ASSETS
Cash and cash equivalents - 4
Accounts and notes receivable 140 135
Unbilled and accrued revenues 49 45
Inventories, at average cost 37 28
Prepayments and other 41 31
267 243
DEFERRED CHARGES
Unamortized regulatory assets 691 731
Miscellaneous 26 27
717 758
$ 3,167 $ 3,162
CAPITALIZATION AND LIABILITIES
CAPITALIZATION
Common stock equity
Common stock, $3.75 par value per
share, 100,000,000 shares
authorized, 42,758,877 shares
outstanding $ 160 $ 160
Other paid-in capital - net 480 480
Retained earnings 401 356
Cumulative preferred stock
Subject to mandatory redemption 30 30
Long-term obligations 701 744
1,772 1,770
CURRENT LIABILITIES
Long-term debt due within one year 32 102
Short-term borrowings 266 105
Accounts payable and other accruals 167 145
Accrued interest 11 11
Dividends payable 1 1
Accrued taxes 12 35
489 399
OTHER
Deferred income taxes 351 351
Deferred investment tax credits 36 39
Trojan decommissioning and transition costs 234 274
Unamortized regulatory liabilities 197 237
Miscellaneous 88 92
906 993
$ 3,167 $ 3,162
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE YEARS ENDED DECEMBER 31 1999 1998 1997
(MILLIONS OF DOLLARS)
CASH FLOWS FROM OPERATING ACTIVITIES:
Reconciliation of net income to net cash
provided by (used in) operating activities
Net income $ 128 $ 137 $ 126
Non-cash items included in net income:
Depreciation and amortization 155 149 155
Deferred income taxes and investment
tax credit (3) (5) (58)
Other non-cash expenses - - 24
Changes in working capital:
(Increase) decrease in receivables (9) (8) 27
Increase (decrease) in payables (1) (50) 51
Other working capital items - net (18) (1) (1)
Other - net (16) 43 35
NET CASH PROVIDED BY OPERATING ACTIVITIES: 236 265 359
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (188) (144) (180)
Other - net 14 (4) (28)
NET CASH USED IN INVESTING ACTIVITIES (174) (148) (208)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt (113) (214) (115)
Issuance of long-term debt and
commercial paper 161 148 8
Dividends paid (83) (51) (65)
Repayment of loans on corporate
owned life insurance (32) - -
Other - net 1 1 5
(66) (116) (167)
NET CASH USED IN FINANCING ACTIVITIES:
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (4) 1 (16)
CASH AND CASH EQUIVALENTS,
THE BEGINNING OF YEAR 4 3 19
CASH AND CASH EQUIVALENTS,
END OF YEAR $ - $ 4 $ 3
Supplemental disclosures of cash flow
information
Cash paid during the year:
Interest, net of amounts capitalized $ 60 $ 63 $ 71
Income taxes 139 133 96
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES NOTES TO FINANCIAL
STATEMENTS
NATURE OF OPERATIONS
On July 1, 1997 Portland General Corporation (PGC), the former parent of
PGE, merged with Enron Corp. (Enron) with Enron continuing in existence as
the surviving corporation. PGE is currently a wholly owned subsidiary of
Enron and subject to control by the Board of Directors of Enron. PGE is
engaged in the generation, purchase, transmission, distribution, and sale
of electricity in the State of Oregon. PGE also sells energy to wholesale
customers, predominately utilities, marketers and brokers throughout the
western United States. PGE's Oregon service area is 3,170 square miles,
including 54 incorporated cities, of which Portland and Salem are the
largest, within a state-approved service area allocation of 4,070 square
miles. At the end of 1999, PGE's service area population was approximately
1.5 million, comprising about 44% of the state's population and serving
approximately 719,000 customers.
On November 8, 1999, Enron announced that it had entered into a purchase
and sale agreement to sell PGE to Sierra Pacific Resources (Sierra) for
$2.1 billion, comprised of $2.02 billion in cash and the assumption of
Enron's approximately $80 million merger payment obligation. The proposed
transaction, which is subject to regulatory approval, is expected to close
in late 2000.
On January 18, 2000, Sierra filed with the OPUC an application to acquire
PGE. On February 3, 2000, Sierra filed with the SEC an application to
acquire PGE and also to become a registered public utility holding company.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
CONSOLIDATION PRINCIPLES
The consolidated financial statements include the accounts of PGE and its
majority-owned subsidiaries. Intercompany balances and transactions have
been eliminated.
BASIS OF ACCOUNTING
PGE and its subsidiaries' financial statements conform to accounting
principles generally accepted in the United States. In addition, PGE's
accounting policies are in accordance with the requirements and the rate
making practices of regulatory authorities having jurisdiction. PGE's
consolidated financial statements do not reflect an allocation of the
purchase price that was recorded by Enron as a result of the PGC merger.
USE OF ESTIMATES
The preparation of financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
RECLASSIFICATIONS
Certain amounts in prior years have been reclassified for comparative
purposes.
REVENUES
PGE accrues estimated unbilled revenues for services provided from the
meter read date to month-end.
<PAGE>
PURCHASED POWER
PGE credits purchased power costs for the benefits received through a power
purchase and sale contract with the BPA. Reductions in purchased power
costs that result from this exchange are passed directly to PGE's
residential and small farm customers in the form of lower prices. PGE and
the BPA reached a new agreement in September 1998, which will continue to
provide benefits to PGE's residential and small farm customers through at
least June 30, 2001.
DEPRECIATION
PGE's depreciation is computed on the straight-line method based on the
estimated average service lives of the various classes of plant in service.
Depreciation expense as a percent of the related average depreciable plant
in service was approximately 4.2% in 1999 and 4.3% in 1998 and 1997.
The cost of renewal and replacement of property units is charged to plant,
while repairs and maintenance costs are charged to expense as incurred.
The cost of utility property units retired, other than land, is charged to
accumulated depreciation.
PGE exercised its option to purchase six leased combustion turbine
generators at the Beaver generating plant for approximately $37 million at
the August 1999 termination of the lease. No gain or loss was recognized
on this transaction.
ALLOWANCE FOR FUNDS USED DURING CONSTRUCTION (AFDC)
AFDC represents the pre tax cost of borrowed funds used for construction
purposes and a reasonable rate for equity funds. AFDC is capitalized as
part of the cost of plant and is credited to income but does not represent
current cash earnings. The average rate used by PGE was 5.3%.
INCOME TAXES
PGE's federal income taxes are a part of its parent company's consolidated
federal income tax return. PGE pays for its tax liabilities when it
generates taxable income and is reimbursed for its tax benefits by the
parent company on a stand-alone basis. Deferred income taxes are provided
for temporary differences between financial and income tax reporting.
Amounts recorded for Investment Tax Credits (ITC) have been deferred and
are being amortized to income over the approximate lives of the related
properties, not to exceed 25 years. See Note 3, Income Taxes, for more
details.
CASH AND CASH EQUIVALENTS
Highly liquid investments with original maturities of three months or less
are classified as cash equivalents.
REGULATORY ASSETS AND LIABILITIES
The Company is subject to the provisions of Statement of Financial
Accounting Standards (SFAS) No. 71, "Accounting for the Effects of Certain
Types of Regulation". When the requirements of SFAS No. 71 are met, PGE
defers certain costs, which would otherwise be charged to expense if it is
probable that future prices will permit recovery of such costs. In
addition, PGE defers certain revenues, gains, or cost reductions which
would normally be reflected in income but through the rate making process
ultimately will be refunded to customers. Regulatory assets and liabilities
reflected as deferred charges and other liabilities in the financial
statements are amortized over the period in which they are included in
billings to customers.
<PAGE>
Amounts in the Consolidated Balance Sheets as of December 31 relate to the
following:
1999 1998
(millions of dollars)
Unamortized regulatory assets:
Trojan-related $398 $438
Income taxes recoverable 165 165
Debt reacquisition costs 23 25
Conservation investments - secured 61 64
Energy efficiency programs 22 21
Miscellaneous 22 18
Total $691 $731
Unamortized regulatory liabilities:
Deferred gain on SCE termination $ 81 $ 92
Merger payment obligation 88 96
Miscellaneous 28 49
Total $197 $237
As of December 31, 1999, a majority of the Company's regulatory assets and
liabilities are being reflected in rates charged to customers. Based on
rates in place at year-end 1999, the Company estimates that it will collect
substantially all of its regulatory assets within the next 12 years.
CONSERVATION INVESTMENTS - SECURED - In 1996, $81 million of PGE's energy
efficiency investment was designated as Bondable Conservation Investment
upon PGE's issuance of 10-year 6.91% Conservation Bonds collateralized by
OPUC-assured future revenues. These bonds provide savings to customers
while granting PGE immediate recovery of its prior energy efficiency
program expenditures. Revenues collected from customers fund the debt
service obligation on the conservation bonds. At December 31, 1999, the
outstanding balance on the bonds was $61 million.
DEFERRED GAIN ON SOUTHERN CALIFORNIA EDISON COMPANY (SCE) TERMINATION - In
1996, PGE and SCE entered into a termination agreement for the Power Sales
Agreement between the two companies. The agreement requires that SCE pay
PGE $141 million over 6 years ($15 million per year in 1997 through 1999
and $32 million per year in 2000 through 2002). The gain is being
recognized in income consistent with current rate making treatment.
MERGER PAYMENT OBLIGATION - Pursuant to the Enron/PGC merger agreement, PGE
customers are guaranteed $105 million in compensation and benefits, payable
over an eight-year period, in the form of reduced prices. These benefits
are being paid by Enron, received by PGE, and passed on to PGE's retail
customers.
<PAGE>
NOTE 2 - EMPLOYEE BENEFITS
PENSION AND OTHER POST-RETIREMENT PLANS
PGE participates in a non-contributory defined benefit pension plan (the
Plan) with other affiliated companies. Substantially all of the plan
members are current or former PGE employees. The plan's assets are held in
a trust.
PGE also participates in non-contributory post-retirement health and life
insurance plans ("Other Benefits" below). Employees are covered under a
Defined Dollar Medical Benefit Plan which limits PGE's obligation by
establishing a maximum contribution per employee. Contributions are made
to a voluntary employee's beneficiary association to fund these plans.
The following table provides a reconciliation of the changes in the plans'
benefit obligations and fair value of plans' assets, a statement of the
funded status, and components of net periodic pension expense (in
millions):
PENSION BENEFITS OTHER BENEFITS
1999 1998 1999 1998
RECONCILIATION OF BENEFIT
OBLIGATION:
Obligation at January 1 $284 $254 $ 29 $ 26
Service cost 8 7 1 0
Interest cost 20 18 2 2
Plan amendments 6 - - -
Curtailments(a) (8) - - -
Participants' contributions - - - 1
Actuarial loss (gain) (25) 18 (1) 2
Benefit payments (18) (13) (2) (2)
Obligation at December 31 $267 $284 $ 29 $ 29
RECONCILIATION OF FAIR VALUE OF PLAN ASSETS:
Fair value of plan assets
at January 1 $401 $375 $ 33 $ 32
Actual return on plan assets 55 38 3 1
Participants' contributions - - 1 1
Company contributions 1 1 - 1
Benefit payments (18) (13) (2) (2)
Fair value of plan assets at
December 31 $439 $401 $ 35 $ 33
FUNDED STATUS:
Funded status at December 31 $172 $117 $ 6 $ 4
Unrecognized transition (asset) (9) (11) 4 4
Unrecognized prior service cost 13 11 2 2
Unrecognized gain (162) (117) (13) (10)
Prepaid Pension Cost $ 14 $ 0 $ (1) $ 0
ASSUMPTIONS:
Discount rate used to calculate
benefit obligation 7.75% 6.75% 7.75% 6.75%
Rate of increase in future
compensation levels 4.0 - 9.5% 4.0-9.5% 4.0-9.5% 4.0-9.5%
Long-term rate of return
on assets 9.00% 9.00% 9.50% 9.50%
COMPONENTS OF NET PERIODIC PENSION EXPENSE:
Service cost $ 8 $ 7 $ 1 $ 1
Interest cost on benefit
obligation 20 18 2 2
Expected return on plan assets (31) (28) (2) (2)
Amortization of transition asset (2) (2) - -
Amortization of prior service
cost 1 1 - -
Recognized gain (3) (3) (1) (1)
Effect of curtailment(a) (5) - - -
Net periodic pension
(benefit) $ (12) $ (7) $ 0 $ 0
(a) Represents one-time nonrecurring event associated with certain union
employees ceasing participation in the pension plan as a result of union
negotiations.
<PAGE>
Included in the above Pension Benefits amounts are the unfunded obligations
for the supplemental executive retirement plan. At December 31, 1999 and
1998, respectively, the projected benefit obligation for this plan was $12
million and $13 million.
For measurement purposes, a 10.0% annual rate of increase in the per capita
cost of covered health care benefits was assumed for 2000. The rate was
assumed to decrease .5% per year to 5.0% in 2010 and remain at that level
thereafter. Assumed health care cost trend rates have a significant effect
on the amounts reported for the health care plans. A one-percentage point
change in assumed health care cost trend rates would have the following
effects (in millions):
1-Percentage 1-Percentage
POINT POINT
INCREASE DECREASE
Effect on total of service and
interest cost components $0.1 $(0.1)
Effect on post-retirement benefit
obligation $0.8 $(0.8)
DEFERRED COMPENSATION
PGE provides certain employees with benefits under an unfunded Management
Deferred Compensation Plan (MDCP). Obligations for the MDCP were $34
million and $29 million at December 31, 1999 and 1998, respectively.
EMPLOYEE STOCK OWNERSHIP PLAN
PGE participated in the PGH Retirement Savings Plan through June 30, 1999.
On July 1, 1999, the plan merged into the Enron Savings Plan and PGE
continued participation. The successor plan includes an Employee Stock
Ownership Plan (ESOP). One-half of employee contributions up to 6% of base
pay are matched by employer contributions in the form of Enron common
stock.
ALL EMPLOYEE STOCK OPTION PLAN
Enron stock options were granted to PGE employees on December 31, 1997. The
options were granted at the fair value of the stock at the date of the
grant. One-third of the options vested in 1998, one-third vested in 1999,
and one-third will vest in 2000. PGE pays Enron the estimated value of the
shares vesting each year. The fair value of shares that vested in 1999 and
1998 were $4 million and $5 million, respectively. It is estimated that
shares valued at $4 million will vest in 2000. The value is calculated
using the Black-Scholes option-pricing model.
<PAGE>
NOTE 3 - INCOME TAXES
The following table shows the detail of taxes on income and the items used
in computing the differences between the statutory federal income tax rate
and PGE's effective tax rate (millions of dollars):
1999 1998 1997
Income Tax Expense
Currently payable
Federal $ 78 $ 75 $114
State and local 16 13 14
94 88 128
Deferred income taxes
Federal (1) (1) (45)
State and local 2 (1) (9)
1 (2) (54)
Investment tax credit adjustments (4) (4) (4)
$ 91 $ 82 $ 70
Provision Allocated to:
Operations $ 84 $ 81 $ 83
Other income and deductions 7 1 (13)
$ 91 $ 82 $ 70
Effective Tax Rate Computation:
Computed tax based on statutory federal
income tax ratesapplied to income before
income taxes $ 77 $ 77 $ 69
Flow through depreciation 7 4 6
State and local taxes - net 11 7 13
State of Oregon refund - - (9)
Investment tax credits (4) (4) (4)
Excess deferred tax (1) (1) (1)
Other 1 (1) (4)
$ 91 $ 82 $ 70
Effective tax rate 41.5% 37.5% 35.7%
<PAGE>
As of December 31, 1999 and 1998, the significant components of PGE's
deferred income tax assets and liabilities were as follows (millions of
dollars):
1999 1998
DEFERRED TAX ASSETS
Depreciation and amortization $ 24 $ 27
SCE termination payment 36 42
Other regulatory liabilities 15 14
Employee fringe benefits 15 15
Other 5 4
95 102
DEFERRED TAX LIABILITIES
Depreciation and amortization $(356) $(378)
Price risk management (9) (9)
Trojan abandonment (55) (56)
Other regulatory assets (16) (3)
Other (10) (7)
(446) (453)
Total $(351) $(351)
PGE has recorded deferred tax assets and liabilities for all temporary
differences between the financial statement basis and tax basis of assets
and liabilities.
<PAGE>
NOTE 4 - COMMON AND PREFERRED STOCK
COMMON STOCK CUMULATIVE PREFERRED
NUMBER $3.75 PAR NUMBER NO- PAR PAID-IN
(millions of dollars OF SHARES VALUE OF SHARES VALUE CAPITAL
except share amounts)
December 31, 1997 42,758,877 $160 300,000 $30 $480
December 31, 1998 42,758,877 160 300,000 30 480
December 31, 1999 42,758,877 160 300,000 30 480
CUMULATIVE PREFERRED STOCK
PGE has authorized 30 million shares of cumulative preferred stock, no par
value; there are 300,000 shares of the 7.75% series outstanding. The 7.75%
series preferred stock has an annual sinking fund requirement, which
requires the redemption of 15,000 shares at $100 per share beginning in
2002. At its option, PGE may redeem, through the sinking fund, an
additional 15,000 shares each year. All remaining shares shall be
mandatorily redeemed by sinking fund in 2007. This series is only
redeemable by operation of the sinking fund.
No dividends may be paid on common stock or any class of stock over which
the preferred stock has priority unless all amounts required to be paid for
dividends and sinking fund payments have been paid or set aside,
respectively.
COMMON DIVIDEND RESTRICTION OF SUBSIDIARY
Enron is the sole shareholder of PGE common stock. PGE is restricted from
paying dividends or making other distributions to Enron without prior OPUC
approval to the extent such payment or distribution would reduce PGE's
common stock equity capital below 48% of its total capitalization.
<PAGE>
NOTE 5 - CREDIT FACILITIES AND DEBT
At December 31, 1999, PGE had committed lines of credit totaling $300
million. Credit lines of $200 million, with an annual fee of 0.10%, expire
in July 2000; credit lines of $100 million, with an annual fee of 0.125%,
expire in August 2000. These lines of credit, which do not require
compensating cash balances, are used primarily as backup for both
commercial paper and borrowings from commercial banks under uncommitted
lines of credit.
Unused committed lines of credit must be at least equal to the amount of
PGE's commercial paper outstanding. Commercial paper and lines of credit
borrowings are at rates reflecting current market conditions.
Short-term borrowings and related interest rates were as follows:
1999 1998
(millions of dollars)
AS OF YEAR-END
Aggregate short-term debt outstanding
Commercial paper $266 $105
Weighted average interest rate*
Commercial paper 6.1% 5.2%
Committed lines of credit $300 $200
FOR THE YEAR ENDED:
Average daily amounts of short-term
debt outstanding
Commercial paper $162 $113
Weighted daily average interest rate*
Commercial paper 5.5% 5.4%
Maximum amount outstanding during the year $266 $144
* Interest rates exclude the effect of commitment fees, facility fees
and other financing fees.
<PAGE>
The Indenture securing PGE's First Mortgage Bonds constitutes a direct
first mortgage lien on substantially all utility property and franchises,
other than expressly excepted property.
Schedule of long-term debt at December 31 1999 1998
(millions of dollars)
First Mortgage Bonds
Maturing 1999 - 2004 6.47% - 8.88% $ 170 $ 219
Maturing 2005 - 2007 7.15% - 9.07% 68 113
Maturing 2021 - 2023 7.75% - 9.46% 160 170
398 502
Pollution Control Bonds
Port of Morrow, Oregon, variable rate,
due 2013 & 2031 (Average rate 3.4% for
1999, 3.5% for 1998) 6 6
Port of Morrow, Oregon, variable rate,
due 2031 & 2033 (4.60% fixed rate to 2003) 23 23
City of Forsyth, Montana, variable rate, due
2033 (4.60%-4.75% fixed rate to 2003) 119 119
Port of St. Helens, Oregon, variable rate due
2010 & 2014 (4.80% - 5.25% fixed rate to 2003) 47 47
Port of St. Helens, Oregon, due 2014 (7.13%
fixed rate) 5 5
200 200
Other
8.25% Junior Subordinated Deferrable Interest
Debentures, due December 31, 2035 75 75
6.91% Conservation Bonds maturing monthly to 2006 61 68
Capital lease obligations - 1
Unamortized debt discounts (1) -
135 144
733 846
Long-term debt due within one year (32) (102)
Total long-term debt $ 701 $ 744
The following principal amounts of long-term debt (excluding commercial
paper) become due through regular maturities (millions of dollars):
2000 2001 2002 2003 2004
Maturities:
PGE $32 $53 $23 $49 $55
<PAGE>
NOTE 6 - OTHER FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS
The following methods and assumptions were used to estimate the fair value
of each class of financial instrument for which it is practical to estimate
that value.
CASH AND CASH EQUIVALENTS - The carrying amount of cash and cash
equivalents approximates fair value because of the short maturity of those
instruments.
OTHER INVESTMENTS - Other investments approximate market value.
REDEEMABLE PREFERRED STOCK - The fair value of redeemable preferred stock
is based on quoted market prices.
LONG-TERM DEBT - The fair value of long-term debt is estimated based on the
quoted market prices for the same or similar issues or on the current rates
offered to PGE for debt of similar remaining maturities.
INTEREST RATE SWAPS - At December 31, 1998, PGE had entered into interest
rate swap agreements with a notional principal amount of $142 million to
manage interest rate exposure. In March 1999, PGE cancelled these
agreements; the amount received at cancellation was not material.
The estimated fair values of debt and equity instruments are as follows
(millions of dollars):
1999 1998
Carrying Fair Carrying Fair
Amount Value Amount Value
Preferred stock subject to mandatory
redemption $ 30 $ 32 $ 30 $ 35
Long-term debt including
current maturities $734 $714 $845 $892
Interest rate swaps in net
receivable position $ - $ - $ - $ 1
<PAGE>
NOTE 7 - COMMITMENTS
NATURAL GAS AGREEMENTS
PGE has long-term agreements for transmission of natural gas from domestic
and Canadian sources to natural gas-fired generating facilities. The
agreements provide firm pipeline capacity. Under the terms of these
agreements, PGE is committed to paying capacity charges of approximately
$15 million annually in 2000 through 2004 and $107 million over the
remaining years of the contracts. PGE's capacity payments amounted to $16
million in 1999 and 1998, and $16 million in 1997. These contracts expire
at varying dates from 2001 to 2015. PGE has the right to assign unused
capacity to other parties.
PURCHASE COMMITMENTS
Certain commitments have been made related to capital expenditures planned
for 2000. Obligations related to these expenditures totaled $8 million as
of December 31, 1999. Cancellation of these purchase agreements could
result in cancellation charges. In addition, PGE is committed to its hydro
relicensing efforts, and has certain obligations related to these projects.
PURCHASED POWER
PGE has long-term power purchase contracts with certain public utility
districts in the state of Washington and with the City of Portland, Oregon.
PGE is required to pay its proportionate share of the operating and debt
service costs of the hydro projects whether or not they are operable.
Selected information is summarized as follows (millions of dollars):
ROCKY PRIEST PORTLAND
REACH RAPIDS WANAPUM WELLS HYDRO
Revenue bonds
outstanding at
December 31, 1999 $229 $169 $186 $183 $ 33
PGE's current share of:
Output 12.0% 13.9% 18.7% 20.3% 100%
Net capability
(megawatts) 154 131 194 171 36
Annual cost, including debt service:
1999 $ 6 $ 4 $ 6 $ 6 $ 4
1998 6 4 6 6 4
1997 7 3 4 6 4
Contract expiration
date 2011 2005 2009 2018 2017
PGE's share of debt service costs, excluding interest, will be
approximately $6 million for 2000, $7 million for 2001 through 2002, $8
million for 2003, and $7 million for 2004. The minimum payments through
the remainder of the contracts are estimated to total $66 million.
PGE has entered into long-term contracts to purchase power from other
utilities in the region. These contracts will require fixed payments of up
to $20 million in 2000 and $19 million in 2001 through 2003. After that
date, capacity contract charges will average $19 million annually until
2016. Long-term contract payments amounted to $22 million in 1999, $22
million in 1998, and $23 million in 1997.
<PAGE>
LEASES
PGE has operating lease arrangements for its headquarters complex,
coal-handling facilities and certain railroad cars for Boardman. PGE's
aggregate rental payments charged to expense totaled $24 million in 1999,
$23 million in 1998, and $24 million in 1997.
Future minimum lease payments under non-cancelable leases are as follows
(millions of dollars):
YEAR ENDING OPERATING LEASES
DECEMBER 31 (NET OF SUBLEASE RENTALS)
2000 $ 20
2001 20
2002 10
2003 10
2004 10
Remainder 157
Total $227
Included in the future minimum operating lease payments schedule above is
approximately $109 million for PGE's headquarters complex.
NOTE 8 - PROPERTY DIVIDEND
During 1997, PGE transferred its rights and certain obligations under the
WNP-3 Settlement Exchange Agreement (WSA) and the long-term power sale
agreement with the Western Area Power Administration (WAPA) to Enron in the
form of a special non-cash dividend.
NOTE 9 - JOINTLY OWNED PLANT
At December 31, 1999, PGE had the following investments in jointly owned
generating plants (millions of dollars):
MW PGE % PLANT ACCUMULATED
FACILITY LOCATION FUEL CAPACITY INTEREST IN SERVICE DEPRECIATION
Boardman Boardman,OR Coal 561 65.0 $381 $221
Colstrip
3&4 Colstrip,MT Coal 1,556 20.0 455 250
The dollar amounts in the table above represent PGE's share of each jointly
owned plant. Each participant in the above generating plants has provided
its own financing. PGE's share of the direct expenses of these plants is
included in the corresponding operating expenses on PGE's consolidated
income statements.
<PAGE>
NOTE 10 - LEGAL MATTERS
TROJAN INVESTMENT RECOVERY - On June 24, 1998, the Oregon Court of Appeals
ruled that the OPUC does not have the authority to allow PGE to recover a
rate of return on its undepreciated investment in the Trojan generating
facility. The court upheld the OPUC's authorization of PGE's recovery of
its undepreciated investment in Trojan.
The Court of Appeals decision was a result of combined appeals from earlier
circuit court rulings. In April 1996, a Marion County Circuit Court judge
ruled that the OPUC could not authorize PGE to collect a return on its
undepreciated investment in Trojan, contradicting a November 1994 ruling
from the same court upholding the OPUC's authority. The 1996 ruling was
the result of an appeal of PGE's 1995 general rate order, which granted PGE
recovery of, and a return on, 87% of its remaining investment in Trojan.
On August 26, 1998, PGE and the OPUC filed a petition for review with the
Oregon Supreme Court, supported by amicus briefs filed by three other major
utilities seeking review of that portion of the Oregon Court of Appeals
decision relating to PGE's return on its undepreciated investment in Trojan
Also on August 26, 1998, the Utility Reform Project filed a petition for
review with the Oregon Supreme Court seeking review of that portion of the
Oregon Court of Appeals decision relating to PGE's recovery of its
undepreciated investment in Trojan.
On April 29, 1999, the Oregon Supreme Court accepted the petitions for
review of the June 24, 1998, Oregon Court of Appeals decision.
On June 16, 1999, Oregon's governor signed Oregon House Bill 3220
authorizing the OPUC to allow recovery of a return on the undepreciated
investment in property retired from service. One of the effects of the
bill is to affirm retroactively the OPUC's authority to allow PGE's
recovery of a return on its undepreciated investment in the Trojan
generating facility.
Relying on the new legislation, on July 2, 1999, the Company requested the
Oregon Supreme Court to vacate the June 24, 1998, adverse ruling of the
Oregon Court of Appeals and affirm the validity of the OPUC's order
allowing PGE to recover a return on its undepreciated investment in Trojan.
The Utility Reform Project and the Citizens Utility Board, another party to
the proceeding, opposed such request on the ground that an effort was
underway to gather sufficient signatures to place on the ballot a
referendum to negate the new legislation; such effort by the referendum's
sponsors was successful and the referendum will appear on the November 2000
ballot. The Oregon Supreme Court has stated it will hold its review of the
Court of Appeals decision in abeyance until after the election.
At December 31, 1999, PGE's after-tax Trojan plant investment was $147
million. PGE is presently collecting annual revenues of approximately $18
million, representing a return on its undepreciated investment. Revenue
amounts reflecting a recovery of a return on the Trojan investment decline
through the recovery period, which ends in the year 2011.
Management believes that the ultimate outcome of this matter will not have
a material adverse impact on the financial condition of the Company.
However, it may have a material impact on the results of operations for a
future reporting period.
OTHER LEGAL MATTERS - PGE is party to various other claims, legal actions
and complaints arising in the ordinary course of business. These claims
are not considered material.
<PAGE>
NOTE 11 - TROJAN NUCLEAR PLANT
PLANT SHUTDOWN AND TRANSITION COSTS - PGE is a 67.5% owner of Trojan. In
early 1993, PGE ceased commercial operation of the nuclear plant. Since
plant closure, PGE has committed itself to a safe and economical transition
toward a decommissioned plant. Transition costs associated with operating
and maintaining the spent fuel pool and securing the plant until fuel is
transferred to dry storage will be paid from current operating funds.
Delays have extended the expected completion date of transferring the fuel
to dry storage through 2002.
DECOMMISSIONING - In December 1997, PGE filed an updated decommissioning
plan estimate with the OPUC. The plan estimates PGE's cost to decommission
Trojan at $339 million reflected in nominal dollars (actual dollars
expected to be spent in each year). The primary reason for the reduction
from the $351 million estimated in 1994 is a lower inflation rate, coupled
with the acceleration of certain decommissioning activities and partially
offset by cost increases related to the spent fuel storage project. The
current estimate assumes that the majority of decommissioning activities
will occur between 1998 and 2004, while fuel management costs extend
through the year 2018. The original plan represents a site-specific
decommissioning estimate performed for Trojan by an engineering firm
experienced in estimating the cost of decommissioning nuclear plants.
Updates to the plan's original estimate have been prepared by PGE. Final
site restoration activities are anticipated to begin in 2018 after PGE
completes shipment of spent fuel to a USDOE facility (see the Nuclear Fuel
Disposal discussion below). Stated in 1999 dollars, the decommissioning
cost estimate is $297 million.
TROJAN DECOMMISSIONING LIABILITY
(millions of dollars)
Estimate - 12/31/94 $351
Updates filed with NRC - 11/16/95 7
Updates filed with OPUC - 12/01/97 (19)
339
Expenditures through 12/31/99 (114)
Liability - 12/31/99 225
Transition costs 9
Total Trojan obligations $234
PGE is collecting $14 million annually through 2011 from customers for
decommissioning costs. These amounts are deposited in an external trust
fund, which is limited to reimbursing PGE for activities covered in
Trojan's decommissioning plan. Funds were withdrawn during 1999 to cover
the costs of general decommissioning and activities in support of the
independent spent fuel storage installation and the reactor vessel and
internals removal project. Decommissioning funds are invested in
investment-grade preferred stock, tax-exempt bonds, and U.S. Treasury
bonds. Due to an increase in market interest rates during 1999, the market
value of trust investments declined, resulting in no investment gain for
the year. Year-end balances are valued at market.
DECOMMISSIONING TRUST ACTIVITY
(millions of dollars)
1999 1998
Beginning Balance $72 $84
Activity
Contributions 14 14
Gain 0 4
Disbursements (44) (30)
Ending Balance $42 $72
Earnings on the trust fund are used to reduce the amount of decommissioning
costs to be collected from customers. PGE expects any future changes in
estimated decommissioning costs to be incorporated in future revenues to be
collected from customers.
<PAGE>
NUCLEAR FUEL DISPOSAL AND CLEANUP OF FEDERAL PLANTS - PGE contracted with
the USDOE for permanent disposal of its spent nuclear fuel in federal
facilities at a cost of 0.1<cent> per net kilowatt-hour sold at Trojan
which the Company paid during the period the plant operated. Significant
delays are expected in the USDOE acceptance schedule of spent fuel from
domestic utilities. The federal repository, which was originally scheduled
to begin operations in 1998, is now estimated to commence operations no
earlier than 2010. This may create difficulties for PGE in disposing of
its high-level radioactive waste by 2018. However, federal legislation has
been introduced which, if passed, would require USDOE to provide interim
storage for high-level waste until a permanent site is established. PGE
intends to build an interim storage facility at Trojan to house the nuclear
fuel until a federal site is available.
The Energy Policy Act of 1992 provided for the creation of a
Decontamination and Decommissioning Fund to finance the cleanup of USDOE
gas diffusion plants. Funding comes from domestic nuclear utilities and
the federal government. Each utility contributes based on the ratio of the
amount of enrichment services the utility purchased to the total amount of
enrichment services purchased by all domestic utilities prior to the
enactment of the legislation. Based on Trojan's 1.1% usage of total
industry enrichment services, PGE's portion of the funding requirement is
approximately $17 million. Amounts are funded over 15 years beginning with
the USDOE's fiscal year 1993. Since enactment, PGE has made the first
seven of the 15 annual payments with the first payment made in September
1993.
NUCLEAR INSURANCE - The Price-Anderson Amendment of 1988 limits public
liability claims that could arise from a nuclear incident and provides for
loss sharing among all owners of nuclear reactor licenses. Because Trojan
has been permanently defueled, the NRC has exempted PGE from participation
in the secondary financial protection pool covering losses in excess of
$200 million at other nuclear plants. In addition, the NRC has reduced the
required primary nuclear insurance coverage for Trojan from $200 million to
$100 million following a 3 year cool-down period of the nuclear fuel that
is still on-site. The NRC has allowed PGE to self-insure for on-site
decontamination. PGE continues to carry non-contamination property
insurance on the Trojan plant at the $158 million level.
NOTE 12 - RELATED PARTY TRANSACTIONS
As part of its ongoing operations, PGE receives management services from
Enron and provides incidental services to Enron and its affiliated
companies. In 1999, approximately $23 million was paid to Enron for
allocated overhead and other direct costs, including PGE's $4 million share
of the Employee Stock Option Plan. In 1998, PGE paid $17 million to Enron
for management services, including $5 million for employee stock options;
in 1997, PGE paid $2 million to Enron for management services.
In 1999, PGE entered into an agreement to transfer corporate owned life
insurance investments, totaling $21 million, to an Enron affiliate. PGE
accrues interest on the accounts receivable balance at 9.5 percent per
annum. In 1998, PGE had $18 million in accounts receivable from affiliates
related to income tax settlements.
<PAGE>
QUARTERLY COMPARISON FOR 1999 AND 1998 (UNAUDITED)
MARCH 31 JUNE 30 SEPTEMBER 30 DECEMBER 31 TOTAL
(MILLIONS OF DOLLARS)
1999
Operating revenues $299 $294 $408 $377 $1,378
Net operating income 58 40 39 53 190
Net income 45 26 24 33 128
Income available for
common stock 44 25 24 33 126
1998
Operating revenues $314 $260 $274 $328 $1,176
Net operating income 52 42 41 65 200
Net income 37 24 26 50 137
Income available for
common stock 36 25 25 49 135
<PAGE>
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM
8-K
(A) INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
FINANCIAL STATEMENTS
Report of Independent Public Accountants
Consolidated Statements of Income for each of the three years
in the period ended December 31, 1999
Consolidated Statements of Retained Earnings for each of
the three years in the period ended December 31, 1999
Consolidated Balance Sheets at December 31, 1999 and 1998
Consolidated Statement of Cash Flows for each of the three
years in the period ended December 31, 1999
Notes to Financial Statements
FINANCIAL STATEMENT SCHEDULES
Schedules are omitted because of the absence of conditions
under which they are required or because the required
information is given in the financial statements or notes
thereto.
EXHIBITS
See Exhibit Index on Page 27 of this report.
(B) REPORT ON FORM 8-K
None
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND
SUBSIDIARIES
EXHIBIT INDEX
Number Exhibit
(2) PLAN OF ACQUISITION, REORGANIZATION, ARRANGEMENT, LIQUIDATION OR
SUCCESSION
* Amended and Restated Agreement and Plan of Merger, dated as of
July 20, 1996 and amended and restated as of September 24, 1996
among Enron Corp, Enron Oregon Corp and Portland General
Corporation [Amendment 1 to S4 Registration Nos. 333-13791 and
333-13791-1, dated October 10, 1996, Exhibit No. 2.1].
(3) ARTICLES OF INCORPORATION AND BYLAWS
* Copy of Articles of Incorporation of Portland General Electric
Company [Registration No. 2-85001, Exhibit (4)].
* Certificate of Amendment, dated July 2, 1987, to the Articles of
Incorporation limiting the personal liability of directors of
Portland General Electric Company [Form 10-K for the fiscal year
ended December 31, 1987, Exhibit (3)].
* Bylaws of Portland General Electric Company as amended on October
1, 1991 [Form 10-K for the fiscal year ended December 31, 1991,
Exhibit (3)].
* Bylaws of Portland General Electric Company as amended on May 1,
1998 [Form 10-K for the fiscal year ended December 31, 1998,
Exhibit (3)].
(4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES
* Portland General Electric Company Indenture of Mortgage and Deed
of Trust dated July 1, 1945.
* Fortieth Supplemental Indenture dated October 1, 1990 [Form 10-K
for the fiscal year ended December 31, 1990, Exhibit (4)].
* Forty-First Supplemental Indenture dated December 1, 1991 [Form
10-K for the fiscal year ended December 31, 1991, Exhibit (4)].
* Forty-Second Supplemental Indenture dated April 1, 1993 [Form 10-Q
for the quarter ended March 31,1993, Exhibit (4)].
* Forty-Third Supplemental Indenture dated July 1, 1993 [Form 10-Q
for the quarter ended September 30, 1993, Exhibit (4)].
* Forty-Fifth Supplemental Indenture dated May 1, 1995 [Form 10-Q
for the quarter ended June 30, 1995, Exhibit (4)].
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND
SUBSIDIARIES
EXHIBIT INDEX
(4)
CONT
Other instruments, which define the rights of holders of long-term
debt not required to be filed, herein, will be furnished upon
written request.
(10) MATERIAL CONTRACTS
* Residential Purchase and Sale Agreement with the Bonneville Power
Administration [Form 10-K forthe fiscal year ended December 31, 1981,
Exhibit (10)].
* Power Sales Contract and Amendatory Agreement Nos. 1 and 2 with
Bonneville Power Administration [Form 10-K for the fiscal year ended
December 31, 1982, Exhibit (10)].
The following 12 exhibits were filed in conjunction with the 1985
Boardman/Intertie Sale:
* Long-term Power Sale Agreement dated November 5, 1985 [Form 10-K for
the fiscal year ended December 31, 1985, Exhibit (10)].
* Long-term Transmission Service Agreement dated November 5, 1985 [Form
10-K for the fiscal year ended December 31, 1985, Exhibit (10)].
* Participation Agreement dated December 30, 1985 [Form 10-K for the
fiscal year ended December 31, 1985, Exhibit (10)].
* Lease Agreement dated December 30, 1985 [Form 10-K for the fiscal year
ended December 31,1985, Exhibit (10)].
* PGE-Lessee Agreement dated December 30, 1985 [Form 10-K for the fiscal
year ended December 31, 1985, Exhibit (10)].
* Asset Sales Agreement dated December 30, 1985 [Form 10-K for the fiscal
year ended December 31, 1985, Exhibit (10)].
* Bargain and Sale Deed, Bill of Sale, and Grant of Easements and
Licenses, dated December 30, 1985 [Form 10-K for the fiscal year ended
December 31, 1985, Exhibit (10)].
* Supplemental Bill of Sale dated December 30, 1985 [Form 10-K for the
fiscal year ended December 31, 1985, Exhibit (10)].
* Trust Agreement dated December 30, 1985 [Form 10-K for the fiscal year
ended December 31, 1985, Exhibit (10)].
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND
SUBSIDIARIES
EXHIBIT INDEX
Number Exhibit
(10)
CONT * Tax Indemnification Agreement dated December 30, 1985 [Form 10-K
for the fiscal year ended December 31, 1985, Exhibit (10)].
* Trust Indenture, Mortgage and Security Agreement dated December 30,1985
[Form 10-K for the fiscal year ended December 31, 1985, Exhibit (10)].
* Restated and Amended Trust Indenture, Mortgage and Security Agreement
dated February 27, 1986 [Form 10-K for the fiscal year ended December
31, 1997, Exhibit (10)].
* Portland General Holdings, Inc. Outside Directors' Deferred
Compensation Plan, 1997 Restatement dated June 25, 1997
[Form 10-K for fiscal year ended December 31, 1997, Exhibit 10].
* Portland General Holdings, Inc. Retirement Plan for Outside Directors,
1997 Restatement dated June 25, 1997 [Form 10-K for fiscal year ended
December 31, 1997, Exhibit 10].
* Portland General Holdings, Inc. Outside Directors' Life Insurance
Benefit Plan, 1997 Restatement dated June 25, 1997 [Form 10-K for
fiscal year ended December 31, 1997, Exhibit 10].
EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS
* Portland General Holdings, Inc. Management Deferred Compensation
Plan,
1997 Restatement dated June 25, 1997 [Form 10-K for fiscal year
ended December 31, 1997, Exhibit 10].
* Portland General Holdings, Inc. Senior Officers Life Insurance Benefit
Plan, 1997 Restatement Amendment No. 1 dated June 25, 1997 [Form 10-K
for fiscal year ended December 31, 1997, Exhibit 10].
* Portland General Electric Company Annual Incentive MasterPlan [Form
10-K for the fiscal year ended December 31, 1987, Exhibit (10)].
* Portland General Electric Company Annual Incentive Master Plan,
Amendments No. 1 and No. 2 dated March 5, 1990 [Form 10-K for the
fiscal year ended December 31, 1989, Exhibit (10)].
* Portland General Holdings, Inc. Supplemental Executive Retirement
Plan,
1997 Restatement dated June 25, 1997 [Form 10-K for fiscal year
ended December 31, 1997, Exhibit 10].
<PAGE>
PORTLAND GENERAL ELECTRIC COMPANY AND
SUBSIDIARIES
EXHIBIT INDEX
Number Exhibit
(23) CONSENTS OF EXPERTS AND COUNSEL
Portland General Electric Company Consents of Independent Public
Accountants (filed herewith).
(24) POWER OF ATTORNEY
Portland General Electric Company Power of Attorney (filed
herewith).
(27) FINANCIAL DATA SCHEDULE
UT (Electronic Filing Only).
* Incorporated by reference as indicated.
Note: The Exhibits furnished to the Securities and Exchange Commission
with the Form 10-K will be supplied upon written request and payment
of a reasonable fee for reproduction costs. Requests should be sent
to:
Kirk M. Stevens
Controller and Assistant Treasurer
Portland General Electric Company
121 SW Salmon Street, 1WTC0501
Portland, OR 97204
<PAGE>
CONSENTS OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our reports included in this Form 10-K, into the Company's previously filed
Registration Statement File No. 333-77469.
Arthur Andersen LLP
Portland, Oregon
March 7, 2000
