J U N E 2 0 21 P S E G I N V E S T O R U P DAT E

L E A D I N G T O W A R D A S U S T A I N A B L E F U T U R E

WHERE CUSTOMERS UNIVERSALLY USE LESS ENERGY, THE ENERGY THEY USE IS CLEANER AND ITS DELIVERY IS MORE RELIABLE AND MORE RESILIENT

• N Y S E : P E G •

Forward-Looking Statements

Certain of the matters discussed in this presentation about our and our subsidiaries' future performance, including, without limitation, future revenues, earnings, strategies, prospects, consequences and all other statements that are not purely historical constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such statements are based on management's beliefs as well as assumptions made by and information currently available to management. When used herein, the words "anticipate," "intend," "estimate," "believe," "expect," "plan," "should," "hypothetical," "potential," "forecast," "project," variations of such words and similar expressions are intended to identify forward-looking statements. Factors that may cause actual results to differ are often presented with the forward-looking statements themselves. Other factors that could cause actual results to differ materially from those contemplated in any forward-looking statements made by us herein are discussed in filings we make with the United States Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K and subsequent reports on Form 10-Q and Form 8-K. These factors include, but are not limited to:

  • any inability to successfully develop, obtain regulatory approval for, or construct generation, transmission and distribution projects;
  • lack of growth or slower growth in the number of customers or the failure of our Conservation Incentive Program to fully address a decline in customer demand;
  • any equipment failures, accidents, severe weather events, acts of war or terrorism or other incidents, including pandemics such as the ongoing coronavirus pandemic, that may impact our ability to provide safe and reliable service to our customers;
  • any inability to recover the carrying amount of our long-lived assets;
  • any inability to maintain sufficient liquidity;
  • the impact of cybersecurity attacks or intrusions;
  • the impact of the ongoing coronavirus pandemic;
  • the impact of our covenants in our debt instruments on our operations;
  • adverse performance of our nuclear decommissioning and defined benefit plan trust fund investments and changes in funding requirements;
  • risks associated with the timeline and ultimate outcome of our exploration of strategic alternatives relating to PSEG Power's non-nuclear generating fleet;
  • the failure to complete, or delays in completing, our proposed investment in the Ocean Wind offshore wind project, or following the completion of our initial investment in the project, the failure to realize the anticipated strategic and financial benefits of the project;
  • fluctuations in wholesale power and natural gas markets, including the potential impacts on the economic viability of our generation units;
  • our ability to obtain adequate fuel supply;
  • market risks impacting the operation of our generating stations;
  • changes in technology related to energy generation, distribution and consumption and changes in customer usage patterns;
  • third-partycredit risk relating to our sale of generation output and purchase of fuel;
  • any inability of PSEG Power to meet its commitments under forward sale obligations;
  • reliance on transmission facilities to maintain adequate transmission capacity for our power generation fleet;
  • the impact of changes in state and federal legislation and regulations on our business, including PSE&G's ability to recover costs and earn returns on authorized investments;
  • PSE&G's proposed investment programs may not be fully approved by regulators and its capital investment may be lower than planned;
  • the absence of a long-term legislative or other solution for our New Jersey nuclear plants that sufficiently values them for their carbon-free, fuel diversity and resilience attributes, or the impact of the current or subsequent payments for such attributes being materially adversely modified through legal proceedings;
  • adverse changes in energy industry laws, policies and regulations, including market structures and transmission planning and transmission returns;
  • risks associated with our ownership and operation of nuclear facilities, including regulatory risks, such as compliance with the Atomic Energy Act and trade control, environmental and other regulations, as well as financial, environmental and health and safety risks;
  • changes in federal and state environmental regulations and enforcement; and
  • delays in receipt of, or an inability to receive, necessary licenses and permits.

All of the forward-looking statements made in this presentation are qualified by these cautionary statements and we cannot assure you that the results or developments anticipated by management will be realized or even if realized, will have the expected consequences to, or effects on, us or our business, prospects, financial condition, results of operations or cash flows. Readers are cautioned not to place undue reliance on these forward-looking statements in making any investment decision. Forward-looking statements made in this presentation apply only as of the date of this presentation. While we may elect to update forward-looking statements from time to time, we specifically disclaim any obligation to do so, even in light of new information or future events, unless otherwise required by applicable securities laws.

The forward-looking statements contained in this presentation are intended to qualify for the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

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GAAP Disclaimer

PSEG presents Operating Earnings and Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) in addition to its Net Income reported in accordance with accounting principles generally accepted in the United States (GAAP). Operating Earnings and Adjusted EBITDA are non-GAAP financial measures that differ from Net Income. Non-GAAP Operating Earnings exclude the impact of returns (losses) associated with the Nuclear Decommissioning Trust (NDT), Mark-to-Market (MTM) accounting and material one-time items. Non-GAAP Adjusted EBITDA excludes the same items as our non-GAAP Operating Earnings measure as well as income tax expense, interest expense and depreciation and amortization. The last two slides in this presentation (Slides A and B) include a list of items excluded from Net Income to reconcile to non-GAAP Operating Earnings and non-GAAP Adjusted EBITDA with a reference to those slides included on each of the slides where the non-GAAP information appears.

Management uses non-GAAP Operating Earnings in its internal analysis, and in communications with investors and analysts, as a consistent measure for comparing PSEG's financial performance to previous financial results. Management believes non-GAAP Adjusted EBITDA is useful to investors and other users of our financial statements in evaluating operating performance because it provides them with an additional tool to compare business performance across companies and across periods. Management also believes that non-GAAP Adjusted EBITDA is widely used by investors to measure operating performance without regard to items such as income tax expense, interest expense and depreciation and amortization, which can vary substantially from company to company depending upon, among other things, the book value of assets, capital structure and whether assets were constructed or acquired. Non-GAAP Adjusted EBITDA also allows investors and other users to assess the underlying financial performance of our fleet before management's decision to deploy capital.

The presentation of non-GAAP Operating Earnings and non-GAAP Adjusted EBITDA is intended to complement, and should not be considered an alternative to, the presentation of Net Income, which is an indicator of financial performance determined in accordance with GAAP. In addition, non-GAAP Operating Earnings and non-GAAP Adjusted EBITDA as presented in this release may not be comparable to similarly titled measures used by other companies.

Due to the forward looking nature of non-GAAP Operating Earnings and non-GAAP Adjusted EBITDA guidance, PSEG is unable to reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measure. Management is unable to project certain reconciling items, in particular MTM and NDT gains (losses), for future periods due to market volatility. Guidance included herein is as of May 5, 2021.

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From time to time, PSEG, PSE&G and PSEG Power release important information via postings on their corporate Investor Relations website at https://investor.pseg.com. Investors and other interested parties are encouraged to visit the Investor Relations website to review new postings. You can also use the "Email Alerts" link at https://investor.pseg.comto sign-up for automatic email alerts regarding new postings.

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A 118-year New Jersey-based business investing in critical

energy infrastructure, providing safe and increasingly clean energy through two strong businesses

Electric & Gas Distribution and Transmission

Strategy: Investments in energy infrastructure and clean energy support reliability and customer expectations and are aligned with public policy

Value Proposition: A $13 Billion - $15 Billion investment program expected to produce 6.5% - 8% annual compound rate base growth through 2025

2020 Assets $36B

Net Income $1,327M

Regional Competitive Generation

Strategy: Carbon-free nuclear fleet; Exploring strategic alternatives for fossil generating fleet

Value Proposition: Provides substantial free cash flow and positioned to benefit from potential market rule improvements

2020

Assets $13B

Net Income $594M

Non-GAAP Operating Earnings* $430M

ASSETS, NET INCOME AND OPERATING EARNINGS ARE FOR THE YEAR ENDED 12/31/2020.

PSE&G AND PSEG POWER DO NOT ADD TO TOTAL DUE TO PSEG ENTERPRISE/OTHER ACTIVITY.4 *SEE SLIDE B FOR RECONCILIATION OF NET INCOME TO NON-GAAP OPERATING EARNINGS FOR PSEG POWER.

Progress on strategic alternatives for non-nuclear fleet

  • PSEG has entered into an agreement to sell Solar Source's 467 MWDC portfolio of 25 projects to an affiliate of LS Power
  • Furthers PSEG transformation into a primarily regulated electric and gas utility, intended to:
    • Reduce overall business risk and earnings volatility
    • Improve business mix
    • Enhance PSEG's ESG position
    • Focus on New Jersey's Clean Energy agenda
  • Remaining generation will consist of PSEG Power's carbon-free nuclear fleet, and regional offshore wind investments that will be significantly contracted
  • No adverse impact on current shareholder dividend (subject to board approval)
  • Takes into account interests of diverse stakeholders, including our employees
  • No impact on PSE&G or PSEG LI customers, operations or tariffs
  • Marketing of fossil assets continues; completion of both sale processes expected to occur within 2021

ESG=ENVIRONMENTAL, SOCIAL, GOVERNANCE

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PSEG - Public Service Enterprise Group Inc. published this content on 03 June 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 June 2021 13:46:03 UTC.