8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) July 28, 2017

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

(Exact name of registrant as specified in its charter)

New Jersey	001-09120	22-2625848
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

80 Park Plaza

Newark, New Jersey 07102

(Address of principal executive offices) (Zip Code)

973-430-7000

(Registrant’s telephone number, including area code)

http://www.pseg.com

PUBLIC SERVICE ELECTRIC AND GAS COMPANY

(Exact name of registrant as specified in its charter)

New Jersey	001-00973	22-1212800
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

80 Park Plaza

Newark, New Jersey 07102

(Address of principal executive offices) (Zip Code)

973-430-7000

(Registrant’s telephone number, including area code)

http://www.pseg.com

PSEG POWER LLC

(Exact name of registrant as specified in its charter)

Delaware	001-34232	22-3663480
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

80 Park Plaza

Newark, New Jersey 07102

(Address of principal executive offices) (Zip Code)

973-430-7000

(Registrant’s telephone number, including area code)

http://www.pseg.com

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether any of the registrants is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if such registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act  ☐

The information contained in Item 2.02. Results of Operations and Financial Condition in this Form 8-K is furnished solely for Public Service Enterprise Group Incorporated (PSEG). The information contained in Item 7.01 Regulation FD Disclosure in this combined Form 8-K is separately furnished, as noted, by PSEG, Public Service Electric and Gas Company (PSE&G) and PSEG Power LLC (Power). Information contained herein relating to any individual company is provided by such company on its own behalf and in connection with its respective Form 8-K. PSE&G and Power each makes representations only as to itself and makes no other representations whatsoever as to any other company. The materials furnished as Exhibits 99 and 99.1 are available on the pseg.com website under the investor tab, or at http://investor.pseg.com.

Item 2.02 Results of Operations and Financial Condition

PSEG

On July 28, 2017, PSEG announced unaudited financial results for the three months and six months ended June 30, 2017. A copy of the earnings release dated July 28, 2017 is furnished as Exhibit 99 to this Form 8-K.

Item 7.01 Regulation FD Disclosure

PSEG, PSE&G and Power

On July 28, 2017, PSEG conducted an earnings call regarding its 2017 second quarter results. A copy of the slideshow presentation used during the earnings call is furnished as Exhibit 99.1 to this Form 8-K.

Item 9.01 Financial Statements and Exhibits

Exhibit 99	Press Release dated July 28, 2017
Exhibit 99.1	Slideshow Presentation

2

SIGNATURE

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. The signature of the undersigned company shall be deemed to relate only to matters having reference to such company and any subsidiaries thereof.

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
(Registrant)
By:	/s/    Stuart J. Black
	STUART J. BLACK
	Vice President and Controller
	(Principal Accounting Officer)

Date: July 28, 2017

3

SIGNATURE

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. The signature of the undersigned company shall be deemed to relate only to matters having reference to such company and any subsidiaries thereof.

PUBLIC SERVICE ELECTRIC AND GAS COMPANY
(Registrant)
By:	/s/    Stuart J. Black
	STUART J. BLACK
	Vice President and Controller
	(Principal Accounting Officer)

Date: July 28, 2017

4

SIGNATURE

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. The signature of the undersigned company shall be deemed to relate only to matters having reference to such company and any subsidiaries thereof.

PSEG POWER LLC
	(Registrant)
By:	/s/    Stuart J. Black
	STUART J. BLACK
	Vice President and Controller
	(Principal Accounting Officer)

Date: July 28, 2017

5

EX-99

EXHIBIT 99

    Investor News NYSE: PEG

For further information, contact:

•    Kathleen A. Lally, Vice President – Investor Relations	Phone: 973-430-6565
•    Carlotta Chan, Manager - Investor Relations	Phone: 973-430-6596

PSEG ANNOUNCES 2017 SECOND QUARTER RESULTS

NET INCOME OF $0.22 Per Share

Non-GAAP Operating Earnings of $0.62 Per Share

Re-Affirms 2017 Non-GAAP Operating Earnings Guidance of $2.80 - $3.00 Per Share

July 28, 2017 (Newark, NJ) (NYSE:PEG) Public Service Enterprise Group (PSEG) reported second quarter 2017 Net Income of $109 million or $0.22 per share as compared to Net Income of $187 million or $0.37 per share reported for the second quarter of 2016. Non-GAAP Operating Earnings for the second quarter of 2017 were $316 million or $0.62 per share as compared to Non-GAAP Operating Earnings for the second quarter of 2016 of $289 million or $0.57 per share. Net Income for the second quarter of 2017 was affected by accelerated depreciation associated with the June 1, 2017 retirement of the Hudson and Mercer coal/gas generating stations.

Ralph Izzo, Chairman, President and Chief Executive Officer said “PSEG’s second quarter earnings demonstrate the benefits of our utility investment program and adherence to operating efficiently. We remain committed to providing customers with affordable and resilient energy in a manner that also provides investors with strong, sustainable returns on capital. That commitment includes improving New Jersey’s aging infrastructure, as evidenced by our filing yesterday of a 5-year $2.7 billion extension of our Gas System Modernization Program.”

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. Non-GAAP Operating Earnings exclude the impact of returns(losses) associated with Nuclear Decommissioning Trust (NDT), Mark-to-Market (MTM) accounting and material one-time items such as the previously noted Hudson and Mercer retirements.

The table below provides a reconciliation of PSEG’s Net Income to non-GAAP Operating Earnings for the second quarter. See Attachment 11 for a complete list of items excluded from Net Income in the determination of non-GAAP Operating Earnings. The presentation of non-GAAP Operating Earnings 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 as presented in this release may not be comparable to similarly titled measures used by other companies.

PSEG CONSOLIDATED EARNINGS (unaudited)

Second Quarter Comparative Results

2017 and 2016

	Income				Diluted Earnings
	($ millions)				Per Share
	2017		2016		2017		2016
Net Income	$	109	$	187	$	0.22	$	0.37
Reconciling Items*		207		102		0.40		0.20
Non-GAAP Operating Earnings	$	316	$	289	$	0.62	$	0.57
				Avg. Shares		507M		508M

* See Attachment 11

GUIDANCE

Ralph Izzo went on to say, “We generated strong financial results in the first half of the year, and we are maintaining our non-GAAP Operating Earnings guidance for 2017 of $2.80 - $3.00 per share.”

Non-GAAP Operating Earnings guidance by company for the full year remains unchanged:

2017 Non-GAAP Operating Earnings Guidance

($ millions, except EPS)

	2017E
PSE&G		$945 - $985
PSEG Power		$435 - $510
PSEG Enterprise/Other		$35 - $35
Non-GAAP Operating Earnings		$1,415 - $1,530
Non-GAAP EPS		$2.80 - $3.00
E: Estimate

Due to the forward looking nature of non-GAAP Operating Earnings guidance, PSEG is unable to reconcile this non-GAAP financial measure 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.

Non-GAAP Operating Earnings Review and Outlook by Operating Subsidiary

See Attachments 5 and 6 for detail regarding earnings reconciliations for 2017’s second quarter and year-to-date for each of PSEG’s businesses.

PSE&G

PSE&G reported Net Income of $208 million ($0.41 per share) for the second quarter of 2017 compared with Net Income of $179 million ($0.35 per share) for the second quarter of 2016.

PSE&G’s results for the second quarter reflect the benefits of its expanded investment program and regulatory mechanisms providing for recovery of costs and continued control of growth in operating expenses.

Growth in PSE&G’s investment in transmission improved second quarter Net Income comparisons by $0.04 per share. Investments made to enhance system resiliency under the Energy Strong and Gas System Modernization Program (GSMP) drove improved margin and second quarter Net Income comparisons by $0.02 per share. An increase in depreciation expense was offset by a reduction in O&M and other expenses.

Economic conditions in New Jersey continue to show steady improvement, particularly in the level of employment. The impact on electric revenue in the quarter from weather was favorable given warmer than normal conditions which conversely reduced gas sales early in the quarter. On a weather-normalized basis, electric and gas sales declined modestly. On a trailing twelve month basis, weather-normalized electric sales increased 0.1% year-over-year. Gas sales, on the same basis, increased 0.4% with growth in demand from the commercial sector.

PSE&G has had significant advances on a number of fronts. The company filed for an extension of the Gas System Modernization Program. PSE&G is proposing to invest up to $540 million per year for five years beginning in 2019. This program would accelerate the pace of replacement of its aging cast iron and unprotected steel mains and associated services. The filing is consistent with the draft regulations that the NJ Board of Public Utilities (BPU) issued in June 2017 regarding infrastructure investment programs.

PSE&G reached an agreement in principle with BPU Staff and Rate Counsel related to its proposed extension of its investment in Energy Efficiency. PSE&G would invest $69 million (more than 90% of its original request) in energy efficiency equipment for hospitals, multi-family housing and other sectors as well as provide for new residential energy efficiency offerings for smart thermostats and data analytics. This agreement is subject to review by the BPU.

PSE&G continues to progress towards its 2017 plan to invest $3.4 billion in transmission and distribution infrastructure upgrades.

The forecast of PSE&G’s Net Income for 2017 remains unchanged at $945 - $985 million.

PSEG Power

PSEG Power reported a Net Loss of $97 million ($0.19 per share) for the second quarter of 2017 and non-GAAP Adjusted EBITDA of $261 million compared with a Net Loss of $11 million ($0.02 per share) and non-GAAP Adjusted EBITDA of $250 million for the second quarter of 2016. Non-GAAP Operating Earnings for the second quarter of 2017 were $97 million ($0.19 per share) versus $91 million ($0.18 per share) for the second quarter of 2016.

PSEG Power’s Net Loss for the second quarter of 2017 reflects the impact of incremental depreciation and other expenses of $387 million, pre-tax, associated with the retirement of the Hudson and Mercer coal-fired generating stations on June 1, 2017.

Power’s operating results for the second quarter reflect on-going programs to reduce operating expenses and an increase in output which offset a decline in average hedge prices.

Non-GAAP Operating Earnings in the quarter increased $0.01 per share as the result of a June 1, 2017 increase in capacity prices. Growth in output also improved second quarter non-GAAP Operating Earnings comparisons by $0.01 per share. Lower average prices on energy hedges reduced Power’s non-GAAP Operating Earnings in the second quarter by $0.03 per share. A reduction in O&M associated with fewer nuclear and fossil outage related days and the June 1 retirement of Hudson and Mercer improved non-GAAP Operating Earnings by $0.02 per share. A higher level of depreciation was offset by a decline in interest expense.

Output from Power’s generating stations increased 4% in the second quarter. The improvement reflects a decline in nuclear refueling outage days to 46 from 76 outage related days in the year-ago quarter. The nuclear fleet’s capacity factor improved to 89.6% in the quarter from 82.7% producing 7.6 TWh of energy. Power’s gas-fired CCGT fleet operated at an average capacity factor of 55.3% versus 62.3% producing 4.0 TWh of energy. An increase in the price of gas improved the competitive performance of the coal fleet. During the quarter, the coal fleet operated at an average capacity factor of 32.6% versus 18.4% producing 1.4 TWh of energy.

Power continues to forecast output for 2017 of 49 – 50 TWh. Approximately 90% of production for the remainder of the year is hedged at an average price of $46 per MWh. Power has hedged approximately 65% - 70% of its forecast production for 2018 of 52 – 54 TWh at an average price of $41 per MWh. For 2019, Power has hedged 25% - 30% of its forecast production of 58 – 60 TWh at an average price of $41 per MWh. Power continues to assume Basic Generation Service (BGS) volumes will represent approximately 11 TWh of deliveries in 2017.

The forecast increase in output in both 2018 and 2019 reflects the commercial start-up in mid-2018 of 1,300 MWs of new gas-fired combined cycle capacity at the Keys Energy Center in Maryland and Sewaren in New Jersey, and the mid-2019 commercial start-up of the 485 MW gas-fired combined cycle generation unit in Bridgeport Harbor, Connecticut.

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. 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. See Attachment 12 for a complete list of items excluded from Net Income/(Loss) in the determination of non-GAAP Adjusted EBITDA. The presentation of non-GAAP Adjusted EBITDA is intended to complement, and should not be considered an alternative to the presentation of Net Income/(Loss), which is an indicator of financial performance in accordance with GAAP. In addition, 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 Adjusted EBITDA guidance, PSEG is unable to reconcile this non-GAAP financial measure 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.

The forecast range of Power’s 2017 non-GAAP Operating Earnings and non-GAAP Adjusted EBITDA are unchanged at $435 million - $510 million and $1,080 - $1,210 million, respectively.

PSEG Enterprise/Other

PSEG Enterprise/Other reported a Net Loss of $2 million for the second quarter of 2017 versus Net Income of $19 million ($0.04 per share) during the second quarter of 2016. Non-GAAP Operating Earnings for the second quarter of 2017 were $11 million ($0.02 per share) compared to $19 million ($0.04 per share) for the second quarter of 2016.

The Net Loss for the second quarter of 2017 includes a pre-tax charge of $22 million related to on-going liquidity challenges facing NRG REMA, LLC (REMA) and deterioration in market conditions affecting the residual value of the leveraged lease portfolio. The decrease in non-GAAP Operating Earnings quarter-over-quarter reflects the absence of certain tax items recorded in 2016 at PSEG Energy Holdings and higher Parent interest expense.

The forecast of PSEG Enterprise/Other non-GAAP Operating Earnings for 2017 remains unchanged at $35 million.

Financing

PSEG closed the quarter ended June 30, 2017 with $430 million of cash on its balance sheet with debt at the end of the quarter representing approximately 49% of consolidated capital.

######

About PSEG:

Public Service Enterprise Group (NYSE: PEG) is a publicly traded diversified energy company with annual revenues of $9.1 billion. Its operating subsidiaries are: Public Service Electric and Gas Company (PSE&G), PSEG Power LLC, and PSEG Long Island.

Public Service Electric and Gas Company (PSE&G) is New Jersey’s oldest and largest regulated gas and electric delivery utility, serving nearly three-quarters of the state’s population. PSE&G is the winner of the ReliabilityOne Award for superior electric system reliability.

PSEG Power LLC is an independent power producer that generates and sells electricity in the PJM, New York and New England wholesale power markets.

Visit PSEG at: www.pseg.com; PSEG blog, Energize!; PSEG My Alerts!

FORWARD-LOOKING STATEMENT

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:

• 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;

• any inability to manage our energy obligations with available supply;

• increases in competition in wholesale energy and capacity markets;

• changes in technology related to energy generation, distribution and consumption and customer usage patterns;

• economic downturns;

• third party credit risk relating to our sale of generation output and purchase of fuel;

• adverse performance of our decommissioning and defined benefit plan trust fund investments and changes in funding requirements;

• changes in state and federal legislation and regulations;

• the impact of pending rate case proceedings;

• regulatory, financial, environmental, health and safety risks associated with our ownership and operation of nuclear facilities;

• adverse changes in energy industry laws, policies and regulations, including market structures and transmission planning;

• changes in federal and state environmental regulations and enforcement;

• delays in receipt of, or an inability to receive, necessary licenses and permits;

• adverse outcomes of any legal, regulatory or other proceeding, settlement, investigation or claim applicable to us and/or the energy industry;

• changes in tax laws and regulations;

• the impact of our holding company structure on our ability to meet our corporate funding needs, service debt and pay dividends;

• lack of growth or slower growth in the number of customers or changes in customer demand;

• any inability of Power to meet its commitments under forward sale obligations;

• reliance on transmission facilities that we do not own or control and the impact on our ability to maintain adequate transmission capacity;

• any inability to successfully develop or construct generation, transmission and distribution projects;

• any equipment failures, accidents, severe weather events or other incidents that impact our ability to provide safe and reliable service to our customers;

• our inability to exercise control over the operations of generation facilities in which we do not maintain a controlling interest;

• any inability to maintain sufficient liquidity;

• any inability to realize anticipated tax benefits or retain tax credits;

• challenges associated with recruitment and/or retention of key executives and a qualified workforce;

• the impact of our covenants in our debt instruments on our operations; and

• the impact of acts of terrorism, cybersecurity attacks or intrusions.

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.

From time to time, PSEG, PSE&G and PSEG Power release important information via postings on their corporate website at http://investor.pseg.com. Investors and other interested parties are encouraged to visit the corporate website to review new postings. The “Email Alerts” link at http://investor.pseg.com may be used to enroll to receive automatic email alerts and/or Really Simple Syndication (RSS) feeds regarding new postings.

TO FOLLOW AND CONNECT WITH PSEG VIA SOCIAL MEDIA, CLICK ON THE LINKS BELOW:

                                            

PSEG Social Media Channels: PSEG on Facebook; PSEG on Twitter; PSEG on LinkedIn; PSEG on YouTube

Attachment 1

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Consolidating Statements of Operations

(Unaudited, $ millions, except per share data)

	Three Months Ended June 30, 2017
	PSEG			PSEG Enterprise/ Other (a)			PSE&G			PSEG Power
OPERATING REVENUES	$	2,133		$	(164	)	$	1,368		$	929
OPERATING EXPENSES
Energy Costs		588			(281	)		472			397
Operation and Maintenance		708			103			351			254
Depreciation and Amortization		641			10			166			465
Total Operating Expenses		1,937			(168	)		989			1,116
OPERATING INCOME (LOSS)		196			4			379			(187	)
Income from Equity Method Investments		5			—			—			5
Other Income and (Deductions)		61			1			21			39
Other-Than-Temporary Impairments		(3	)		—			—			(3	)
Interest Expense		(91	)		(9	)		(69	)		(13	)
INCOME (LOSS) BEFORE INCOME TAXES		168			(4	)		331			(159	)
Income Tax Benefit (Expense)		(59	)		2			(123	)		62
NET INCOME (LOSS)	$	109		$	(2	)	$	208		$	(97	)
Reconciling Items Excluded from Net Income (Loss) (b)		207			13			—			194
OPERATING EARNINGS (non-GAAP)	$	316		$	11		$	208		$	97
Earnings Per Share
NET INCOME (LOSS)	$	0.22		$	—		$	0.41		$	(0.19	)
Reconciling Items Excluded from Net Income (Loss) (b)		0.40			0.02			—			0.38
OPERATING EARNINGS (non-GAAP)	$	0.62		$	0.02		$	0.41		$	0.19
	Three Months Ended June 30, 2016
	PSEG			PSEG Enterprise/ Other (a)			PSE&G			PSEG Power
OPERATING REVENUES	$	1,905		$	(159	)	$	1,350		$	714
OPERATING EXPENSES
Energy Costs		624			(286	)		529			381
Operation and Maintenance		710			93			352			265
Depreciation and Amortization		224			8			136			80
Total Operating Expenses		1,558			(185	)		1,017			726
OPERATING INCOME (LOSS)		347			26			333			(12	)
Income from Equity Method Investments		4			—			—			4
Other Income and (Deductions)		34			—			18			16
Other-Than-Temporary Impairments		(10	)		—			—			(10	)
Interest Expense		(97	)		(3	)		(74	)		(20	)
INCOME (LOSS) BEFORE INCOME TAXES		278			23			277			(22	)
Income Tax Benefit (Expense)		(91	)		(4	)		(98	)		11
NET INCOME (LOSS)	$	187		$	19		$	179		$	(11	)
Reconciling Items Excluded from Net Income (Loss) (b)		102			—			—			102
OPERATING EARNINGS (non-GAAP)	$	289		$	19		$	179		$	91
Earnings Per Share
NET INCOME (LOSS)	$	0.37		$	0.04		$	0.35		$	(0.02	)
Reconciling Items Excluded from Net Income (Loss) (b)		0.20			—			—			0.20
OPERATING EARNINGS (non-GAAP)	$	0.57		$	0.04		$	0.35		$	0.18

(a) Includes activities at Energy Holdings, PSEG Long Island and the Parent as well as intercompany eliminations.

(b) See Attachments 11 and 12 for details of items excluded from Net Income/(Loss) to compute Operating Earnings (non-GAAP).

Attachment 2

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Consolidating Statements of Operations

(Unaudited, $ millions, except per share data)

	Six Months Ended June 30, 2017
	PSEG			PSEG Enterprise/ Other (a)			PSE&G			PSEG Power
OPERATING REVENUES	$	4,725		$	(668	)	$	3,180		$	2,213
OPERATING EXPENSES
Energy Costs		1,462			(867	)		1,225			1,104
Operation and Maintenance		1,420			218			718			484
Depreciation and Amortization		1,469			17			337			1,115
Total Operating Expenses		4,351			(632	)		2,280			2,703
OPERATING INCOME (LOSS)		374			(36	)		900			(490	)
Income from Equity Method Investments		8			—			—			8
Other Income and (Deductions)		122			7			45			70
Other-Than-Temporary Impairments		(4	)		—			—			(4	)
Interest Expense		(189	)		(16	)		(144	)		(29	)
INCOME (LOSS) BEFORE INCOME TAXES		311			(45	)		801			(445	)
Income Tax Benefit (Expense)		(88	)		28			(294	)		178
NET INCOME (LOSS)	$	223		$	(17	)	$	507		$	(267	)
Reconciling Items Excluded from Net Income (Loss) (b)		559			45			—			514
OPERATING EARNINGS (non-GAAP)	$	782		$	28		$	507		$	247
Earnings Per Share
NET INCOME (LOSS)	$	0.44		$	(0.03	)	$	1.00		$	(0.53	)
Reconciling Items Excluded from Net Income (Loss) (b)		1.10			0.08			—			1.02
OPERATING EARNINGS (non-GAAP)	$	1.54		$	0.05		$	1.00		$	0.49
	Six Months Ended June 30, 2016
	PSEG			PSEG Enterprise/ Other (a)			PSE&G			PSEG Power
OPERATING REVENUES	$	4,521		$	(568	)	$	3,062		$	2,027
OPERATING EXPENSES
Energy Costs		1,460			(817	)		1,258			1,019
Operation and Maintenance		1,439			187			734			518
Depreciation and Amortization		448			14			275			159
Total Operating Expenses		3,347			(616	)		2,267			1,696
OPERATING INCOME		1,174			48			795			331
Income from Equity Method Investments		6			—			—			6
Other Income and (Deductions)		61			—			37			24
Other-Than-Temporary Impairments		(20	)		—			—			(20	)
Interest Expense		(189	)		(5	)		(142	)		(42	)
INCOME BEFORE INCOME TAXES		1,032			43			690			299
Income Tax Benefit (Expense)		(374	)		(7	)		(249	)		(118	)
NET INCOME	$	658		$	36		$	441		$	181
Reconciling Items Excluded from Net Income (b)		94			—			—			94
OPERATING EARNINGS (non-GAAP)	$	752		$	36		$	441		$	275
Earnings Per Share
NET INCOME	$	1.30		$	0.07		$	0.87		$	0.36
Reconciling Items Excluded from Net Income (b)		0.18			—			—			0.18
OPERATING EARNINGS (non-GAAP)	$	1.48		$	0.07		$	0.87		$	0.54

(a) Includes activities at Energy Holdings, PSEG Long Island and the Parent as well as intercompany eliminations.

(b) See Attachments 11 and 12 for details of items excluded from Net Income/(Loss) to compute Operating Earnings (non-GAAP).

Attachment 3

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Capitalization Schedule

(Unaudited, $ millions)

	June 30, 2017			December 31, 2016
DEBT
Commercial Paper and Loans	$	—		$	388
Long-Term Debt*		12,521			11,395
Total Debt		12,521			11,783
STOCKHOLDERS’ EQUITY
Common Stock		4,929			4,936
Treasury Stock		(747	)		(717	)
Retained Earnings		8,962			9,174
Accumulated Other Comprehensive Loss		(226	)		(263	)
Total Stockholders’ Equity		12,918			13,130
Total Capitalization	$	25,439		$	24,913

* Includes current portion of Long-Term Debt

Attachment 4

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, $ millions)

	Six Months Ended June 30,
	2017			2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	223		$	658
Adjustments to Reconcile Net Income to Net Cash Flows From Operating Activities		1,533			1,064
NET CASH PROVIDED BY OPERATING ACTIVITIES		1,756			1,722
NET CASH USED IN INVESTING ACTIVITIES		(1,989	)		(2,004	)
NET CASH PROVIDED BY FINANCING ACTIVITIES		240			536
Net Change in Cash and Cash Equivalents		7			254
Cash and Cash Equivalents at Beginning of Period		423			394
Cash and Cash Equivalents at End of Period	$	430		$	648

Attachment 5

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Quarter-over-Quarter EPS Reconciliation

June 30, 2017 vs. June 30, 2016

(Unaudited)

Attachment 6

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Year-over-Year EPS Reconciliation

June 30, 2017 vs. June 30, 2016

(Unaudited)

Attachment 7

PUBLIC SERVICE ELECTRIC & GAS COMPANY

Retail Sales and Revenues

(Unaudited)

June 30, 2017

Electric Sales and Revenues

Sales (millions kWh)	Three Months Ended		Change vs. 2016			Six Months Ended		Change vs. 2016
Residential		2,977		-0.6	%		5,974		-0.3	%
Commercial & Industrial		6,536		-0.8	%		13,328		0.8	%
Street Lighting		68		-9.2	%		165		-1.6	%
Interdepartmental		2		-2.3	%		5		-1.6	%
Total		9,583		-0.8	%		19,472		0.4	%
Revenue ($ millions)
Residential	$	449		-1.7	%	$	884		-3.0	%
Commercial & Industrial		427		1.9	%		786		1.3	%
Street Lighting		16		-5.6	%		34		-1.0	%
Other Operating Revenues*		198		15.7	%		378		12.4	%
Total	$	1,090		2.4	%	$	2,082		1.2	%
Weather Data	Three Months Ended		Change vs. 2016			Six Months Ended		Change vs. 2016
THI Hours - Actual		4,369		15.3	%		4,384		13.6	%
THI Hours - Normal		4,062					4,091

* Primarily sales of Non-Utility Generator energy to PJM and Transmission related revenues.

Attachment 8

PUBLIC SERVICE ELECTRIC & GAS COMPANY

Retail Sales and Revenues

(Unaudited)

June 30, 2017

Gas Sold and Transported

Sales (millions therms)*	Three Months Ended		Change vs. 2016			Six Months Ended		Change vs. 2016
Firm Sales
Residential Sales		186		-11.5	%		854		-1.3	%
Commercial & Industrial		150		-7.7	%		595		1.0	%
Total Firm Sales		336		-9.8	%		1,449		-0.4	%
Non-Firm Sales
Commercial & Industrial		356		-24.5	%		687		-22.4	%
Total Non-Firm Sales		356					687
Total Sales		692		-18.1	%		2,136		-8.7	%
Revenue ($ millions)
Residential Sales - Firm	$	56		-25.3	%	$	211		6.7	%
Commercial & Industrial - Firm Sales		32		22.3	%		162		43.7	%
Non-Firm Sales		4		10.4	%		15		18.7	%
Other Operating Revenues**		45		2.9	%		87		0.1	%
Total	$	137		-7.5	%	$	475		15.9	%
Gas Transported	$	141		2.5	%	$	623		4.8	%
Weather Data	Three Months Ended		Change vs. 2016			Six Months Ended		Change vs. 2016
Degree Days - Actual		472		-12.5	%		2,771		-1.8	%
Degree Days - Normal		501					3,048

* CSG rate included in non-firm sales

** Primarily Appliance Service.

Attachment 9

PSEG POWER LLC

Generation Measures*

(Unaudited)

	GWhr Breakdown Three Months Ended June 30,						GWhr Breakdown Six Months Ended June 30,
	2017			2016			2017			2016
Nuclear - NJ		4,800			4,196			10,314			9,727
Nuclear - PA		2,766			2,787			5,607			5,675
Total Nuclear		7,566			6,983			15,921			15,402
Fossil - Coal/Natural Gas - NJ**		(15	)		(40	)		(56	)		(59	)
Fossil - Coal - PA		1,368			958			2,763			1,948
Fossil - Coal - CT		7			(6	)		87			50
Total Coal		1,360			912			2,794			1,939
Fossil - Oil & Natural Gas - NJ		2,526			3,161			4,628			5,855
Fossil - Oil & Natural Gas - NY		1,495			1,394			2,445			2,458
Fossil - Oil & Natural Gas - CT		4			(4	)		(2	)		(8	)
Total Oil & Natural Gas		4,025			4,551			7,071			8,305
		12,951			12,446			25,786			25,646
	% Generation by Fuel Type Three Months Ended June 30,						% Generation by Fuel Type Six Months Ended June 30,
	2017			2016			2017			2016
Nuclear - NJ		37	%		34	%		40	%		38	%
Nuclear - PA		21	%		22	%		22	%		22	%
Total Nuclear		58	%		56	%		62	%		60	%
Fossil - Coal/Natural Gas - NJ**		0	%		0	%		0	%		0	%
Fossil - Coal - PA		11	%		8	%		11	%		8	%
Fossil - Coal - CT		0	%		0	%		0	%		0	%
Total Coal		11	%		8	%		11	%		8	%
Fossil - Oil & Natural Gas - NJ		19	%		25	%		18	%		23	%
Fossil - Oil & Natural Gas - NY		12	%		11	%		9	%		9	%
Fossil - Oil & Natural Gas - CT		0	%		0	%		0	%		0	%
Total Oil & Natural Gas		31	%		36	%		27	%		32	%
		100	%		100	%		100	%		100	%

* Excludes Solar and Kalaeloa    

** Includes Pumped Storage. Pumped Storage accounted for <1% of total generation for the three and six months June 30, 2017 and 2016. Generation includes natural gas fuel switching intervals.

Attachment 10

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Statistical Measures

(Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
Weighted Average Common Shares Outstanding (millions)
Basic		505			505			505			505
Diluted		507			508			507			508
Stock Price at End of Period							$	43.01		$	46.61
Dividends Paid per Share of Common Stock	$	0.43		$	0.41		$	0.86		$	0.82
Dividend Yield								4.0	%		3.5	%
Book Value per Common Share							$	25.60		$	26.38
Market Price as a Percent of Book Value								168	%		177	%
Total Shareholder Return		-2.1	%		-0.2	%		-0.1	%		22.7	%

Attachment 11

PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED

Consolidated Operating Earnings (non-GAAP) Reconciliation

Reconciling Items	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	($ millions, Unaudited)
Net Income	$	109		$	187		$	223		$	658
(Gain) Loss on Nuclear Decommissioning Trust (NDT) Fund Related Activity, pre-tax (PSEG Power)		(30	)		—			(47	)		8
(Gain) Loss on Mark-to-Market (MTM), pre-tax (a) (PSEG Power)		(36	)		171			(46	)		149
Hudson/Mercer Early Retirement, pre-tax (PSEG Power)		387			—			951			—
Lease Related Activity, pre-tax (PSEG Enterprise/Other)		22			—			77			—
Income Taxes related to Operating Earnings (non-GAAP) reconciling items (b)		(136	)		(69	)		(376	)		(63	)
Operating Earnings (non-GAAP)	$	316		$	289		$	782		$	752
PSEG Fully Diluted Average Shares Outstanding (in millions)		507			508			507			508
	($ Per Share Impact - Diluted, Unaudited)
Net Income	$	0.22		$	0.37		$	0.44		$	1.30
(Gain) Loss on NDT Fund Related Activity, pre-tax (PSEG Power)		(0.06	)		—			(0.09	)		0.01
(Gain) Loss on MTM, pre-tax (a) (PSEG Power)		(0.07	)		0.34			(0.09	)		0.29
Hudson/Mercer Early Retirement, pre-tax (PSEG Power)		0.77			—			1.87			—
Lease Related Activity, pre-tax (PSEG Enterprise/Other)		0.04			—			0.15			—
Income Taxes related to Operating Earnings (non-GAAP) reconciling items (b)		(0.28	)		(0.14	)		(0.74	)		(0.12	)
Operating Earnings (non-GAAP)	$	0.62		$	0.57		$	1.54		$	1.48

(a) Includes the financial impact from positions with forward delivery months.

(b) Income tax effect calculated at 40.85% statutory rate, except for lease related activity which is calculated at a combined leveraged lease effective tax rate and NDT related activity which is calculated at the 40.85% statutory rate plus a 20% tax on income (losses) from qualified NDT funds.

Attachment 12

PSEG Power Operating Earnings (non-GAAP) and Adjusted EBITDA (non-GAAP) Reconciliation

Reconciling Items	Three Months Ended June 30,						Six Months Ended June 30,
	2017			2016			2017			2016
	($ millions, Unaudited)
Net Income (Loss)	$	(97	)	$	(11	)	$	(267	)	$	181
(Gain) Loss on NDT Fund Related Activity, pre-tax		(30	)		—			(47	)		8
(Gain) Loss on MTM, pre-tax (a)		(36	)		171			(46	)		149
Hudson/Mercer Early Retirement, pre-tax		387			—			951			—
Income Taxes related to Operating Earnings (non-GAAP) reconciling items (b)		(127	)		(69	)		(344	)		(63	)
Operating Earnings (non-GAAP)	$	97		$	91		$	247		$	275
Depreciation and Amortization, pre-tax (c)		87			81			179			161
Interest Expense, pre-tax (c) (d)		12			20			28			42
Income Taxes (c)		65			58			166			181
Adjusted EBITDA (non-GAAP)	$	261		$	250		$	620		$	659
PSEG Fully Diluted Average Shares Outstanding (in millions)		507			508			507			508

(a) Includes the financial impact from positions with forward delivery months.    

(b) Income tax effect calculated at 40.85% statutory rate, except for NDT related activity which is calculated at the 40.85% statutory rate plus a 20% tax on income (losses) from qualified NDT funds.    

(c) Excludes amounts related to Operating Earnings (non-GAAP) reconciling items.    

(d) Net of capitalized interest.    

PSEG Enterprise/Other

Operating Earnings (non-GAAP) Reconciliation

Reconciling Items	Three Months Ended June 30,					Six Months Ended June 30,
	2017			2016		2017			2016
	($ millions, Unaudited)
Net Income (Loss)	$	(2	)	$	19	$	(17	)	$	36
Lease Related Activity, pre-tax		22			—		77			—
Income Taxes related to Operating Earnings (non-GAAP) reconciling items (a)		(9	)		—		(32	)		—
Operating Earnings (non-GAAP)	$	11		$	19	$	28		$	36
PSEG Fully Diluted Average Shares Outstanding (in millions)		507			508		507			508

(a) Income tax effect calculated at a combined leveraged lease effective tax rate.    

EX-99.1

Public Service Enterprise Group

PSEG Earnings Conference Call

2

nd

Quarter 2017

July 28, 2017

EXHIBIT 99.1

1

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:

•     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;

•     any inability to manage our energy obligations with available supply;

•     increases in competition in wholesale energy and capacity markets;

•     changes in technology related to energy generation, distribution and consumption and customer usage patterns;

•     economic downturns;

•     third party credit risk relating to our sale of generation output and purchase of fuel;

•     adverse performance of our decommissioning and defined benefit plan trust fund investments and changes in funding requirements;

•     changes in state and federal legislation and regulations;

•     the impact of pending rate case proceedings;

•     regulatory, financial, environmental, health and safety risks associated with our ownership and operation of nuclear facilities;

•     adverse changes in energy industry laws, policies and regulations, including market structures and transmission planning;

•     changes in federal and state environmental regulations and enforcement;

•     delays in receipt of, or an inability to receive, necessary licenses and permits;

•     adverse outcomes of any legal, regulatory or other proceeding, settlement, investigation or claim applicable to us and/or the energy industry;

•     changes in tax laws and regulations;

•     the impact of our holding company structure on our ability to meet our corporate funding needs, service debt and pay dividends;

•     lack of growth or slower growth in the number of customers or changes in customer demand;

•     any inability of Power to meet its commitments under forward sale obligations;

•     reliance on transmission facilities that we do not own or control and the impact on our ability to maintain adequate transmission capacity;

•     any inability to successfully develop or construct generation, transmission and distribution projects;

•     any

equipment

failures,

accidents,

severe

weather

events

or

other

incidents

that

impact

our

ability

to

provide

safe

and

reliable

service

to

our

customers;

•     our inability to exercise control over the operations of generation facilities in which we do not  maintain a controlling interest;

•     any inability to maintain sufficient liquidity;

•     any inability to realize anticipated tax benefits or retain tax credits;

•     challenges associated with recruitment and/or retention of key executives and a qualified workforce;

•     the impact of our covenants in our debt instruments on our operations; and

•     the impact of acts of terrorism, cybersecurity attacks or intrusions.

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.

2

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/(Loss) 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.

These materials and other financial releases can be found on the PSEG website at www.pseg.com, under the Investors tab. From time to time, PSEG, PSE&G and

PSEG Power release important information via postings on their corporate website at http://investor.pseg.com. Investors and other interested parties are encouraged to

visit the corporate website to review new postings. The “email alerts” link at http://investor.pseg.com

may be used to enroll to receive automatic email alerts and/or

really simple syndication (RSS) feeds regarding new postings at http://investor.pseg.com/rss.

PSEG

2017 Q2 Review

Ralph Izzo

Chairman, President and Chief Executive Officer

4

Second Quarter Highlights

Net Income of $0.22 vs. Net Income of $0.37 per share in Q2 2016, reflecting Hudson & Mercer

retirements

Non-GAAP Operating Earnings* of $0.62 vs. $0.57 per share in Q2 2016

PSE&G

achieved

17%

growth

in

Q2

earnings

per

share

over

Q2

2016

–

supported

by

increased

investment in transmission and distribution, and cost containment

PSEG Power results aided by continued cost control

Operational Excellence

Nuclear

fleet

achieved

a

capacity

factor

of

89.6%

for

Q2

and

94.8%

for

the

first-half

of

2017

PSE&G named Smart Electric Power Alliance’s (SEPA) 2017 Investor Owned Utility of the Year,

recognizing PSE&G’s Solar 4 All program and its leadership in landfill and brownfield solar development 

Disciplined Capital Investment –

Producing Results

PSEG to invest ~$4.7 billion in 2017, consisting of ~$3.4 billion at PSE&G and ~$1.2 billion

at PSEG Power

Regulatory & Policy Focus: New Jersey Board of Public Utilities (BPU) actions support infrastructure

investment; Energy Efficiency agreement in principle reached; $2.7 billion, 5-year Gas System 

Modernization Program (GSMP) extension and expansion filing

Hudson and Mercer coal/gas generating stations retired on June 1

PSEG

Q2

2017

–

Solid

financial

results

at

both

businesses

*  See Slides A and B for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

5

PSEG Q2 Summary –

GAAP EPS decline reflects Hudson

& Mercer retirements

Quarter ended June 30            

*See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

$ millions (except EPS)

2017

2016

Change

Net Income

$  109

$  187 

$  (78)

Reconciling Items

207

102

105      

Operating Earnings (non-GAAP)*

$   316

$   289

$  27

EPS from Net Income

$  0.22

$  0.37

$  (0.15)

EPS from Operating Earnings (non-GAAP)*

$  0.62

$  0.57

$  0.05

Non-GAAP EPS results up 9%

6

PSEG First Half Summary –

GAAP EPS decline reflects

Hudson & Mercer June 1 retirements

Six Months ended June 30         

*See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

$ millions (except EPS)

2017

2016

Change

Net Income

$  223

$  658 

$  (435)

Reconciling Items

559

94

465

Operating Earnings (non-GAAP)*

$  782

$  752

$  30

EPS from Net Income

$  0.44

$  1.30

$  (0.86)

EPS from Operating Earnings (non-GAAP)*

$  1.54

$  1.48

$  0.06

Non-GAAP EPS results up 4%

7

PSE&G –

BPU Proposal to Incentivize Investment

Infrastructure Investment Program (IIP)

The BPU on June 30 proposed changes in regulation that would: 

Encourage and support accelerated utility investment

Support system safety, reliability, resiliency and sustained economic growth in NJ

Support accelerated recovery on qualifying investments, and

Allow utility companies the option to seek approval for investment programs

extending up to five years (with a base rate case within five years)

The BPU is receiving comments on the proposal, and a final order is anticipated by year-end

Growth in utility infrastructure investment drives increased growth

in regulated earnings contribution

8

$2.80 -

$3.00E

PSEG -

Maintaining 2017 Non-GAAP Earnings Guidance 

$2.90

Non-GAAP Operating Earnings*

Contribution by Subsidiary and 2017 Guidance

* See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

** Based

on

the

mid-point

of

2017

non-GAAP

Operating

Earnings

guidance

of

$2.80

-

$3.00

per

share.

E

=

Estimate.                              

2016

2017E**

PSE&G

Power

Enterprise/Other

60%

66%

32%

35%

PSEG

2017 Q2 Operating Company Review

Dan Cregg

EVP and Chief Financial Officer

10

PSEG –

Q2 Results by Subsidiary

GAAP Net Income/(Loss)

2017

2016

Change

PSE&G

$  0.41

$  0.35

$  0.06

PSEG Power

$ (0.19)

$ (0.02)

$  (0.17)

PSEG Enterprise/Other

$  0.00

$  0.04

$  (0.04)

Total PSEG

$  0.22

$  0.37

$  (0.15)

Non-GAAP Operating Earnings*

2017

2016

Change

PSE&G

$  0.41

$  0.35

$  0.06

PSEG Power

$  0.19

$  0.18

$  0.01

PSEG Enterprise/Other

$  0.02

$  0.04

$ (0.02)   

Total PSEG*

$  0.62

$  0.57

$  0.05

*See Slides A and B for Items excluded from Net Income/(Loss) to reconcile to Operating Earnings (non-GAAP) for PSEG, PSEG Power and PSEG

Enterprise/Other.

PSEG Q2 EPS Summary –

Quarter ended June 30

11

$0.37

$0.57

0.06

0.01

$0.62

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70

$0.80

PSEG EPS Reconciliation –

Q2 2017 versus Q2 2016

* See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

Capacity  0.01

Higher

Volume  0.01

Recontracting 

(0.03)

O&M  0.02

Transmission

0.04

Electric and

Gas Margin 

0.02

D&A  (0.01)

Other  0.01

Q2 2017

Net

Income

Q2 2016       

Net

Income

PSEG

Power

PSE&G

Enterprise/

Other

Q2 2016

Operating

Earnings

(non-GAAP)*

Q2 2017       

Operating

Earnings

(non-GAAP)*

Interest

Expense

and

Taxes

(0.02)

$0.22

Utility investment and cost control drove Q2 results

12

PSEG –

First Half Results by Subsidiary

GAAP Net Income/(Loss)

2017

2016

Change

PSE&G

$   1.00

$  0.87

$  0.13

PSEG Power

$ (0.53)

$  0.36

$ (0.89)

PSEG Enterprise/Other

$ (0.03)

$  0.07

$ (0.10)

Total PSEG

$  0.44

$  1.30

$ (0.86)

Non-GAAP Operating Earnings*

2017

2016

Change

PSE&G

$  1.00

$  0.87

$  0.13

PSEG Power

$  0.49

$  0.54

$ (0.05)

PSEG Enterprise/Other

$  0.05

$  0.07

$ (0.02)      

Total PSEG*

$  1.54

$  1.48

$ 0.06

PSEG First Half EPS Summary –

Six months ended June 30

*See Slides A and B for Items excluded from Net Income/(Loss) to reconcile to Operating Earnings (non-GAAP) for PSEG, PSEG Power and PSEG

  Enterprise/Other.

13

PSEG EPS Reconciliation –

First Half 2017 versus First Half 2016

* See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP).

Capacity  0.01

Higher Gas

Send-out  0.02

Recontracting  (0.13)

O&M  0.05

Transmission  0.07 

Electric and Gas

Margin  0.05

Distribution 

O&M  0.02

Distribution

D&A  (0.02)

Taxes & Other  0.01

YTD 2017

Net

Income

YTD 2016

Net

Income

PSEG

Power

PSE&G

Enterprise/

Other

YTD 2016

Operating

Earnings

(non-GAAP)*

YTD 2017       

Operating

Earnings

(non-GAAP)*

Interest

Expense,

Taxes

and Other

Utility investment and cost control drove year-to-date growth

$1.30

$1.48

0.13

$1.54

(0.05)

(0.02)

$0.00

$0.50

$1.00

$1.50

$2.00

$0.44

PSE&G

2017 Q2 Review

$0.35

0.06

0.00

$0.41

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

15

PSE&G EPS Reconciliation –

Q2 2017

versus Q2 2016

Q2 2017      

Net Income

Q2 2016    

Net Income

Transmission

0.04

Electric

and Gas

Margin  0.02

D&A  (0.01)

Other 0.01

Earnings per share rose by 17% vs. Q2 2016,

reflecting infrastructure investment

16

PSE&G –

Q2 2017 weather had minor impact on EPS

2017  vs. 2016 vs. Normal

PSE&G Monthly Weather Summary

279

174

20

365

170

5

359

128

15

0

100

200

300

400

500

2017

2016

Normal

358

851

3,160

129

1,164

2,497

166

877

3,019

0

500

1,000

1,500

2,000

2,500

3,000

3,500

2017

2016

Normal

April

May

June

April

May

June

Monthly Temperature Humidity Index (THI)

Monthly Heating Degree Days (HDD)

Q2 2017 heating degree days were

~12% lower than Q2 2016

and ~6% lower than normal

Q2 2017 temperature-humidity index

was ~15% higher than Q2 2016

and ~8% higher than normal

17

PSE&G –

Regulatory Agreement/Filing Support Long-term Objectives

PSE&G’s recent filing to extend its Gas System Modernization Program (GSMP)

and an agreement reached on its proposed Energy Efficiency investment program

reinforce PSE&G’s commitment to provide clean, reliable energy for its customers

Gas System Modernization Program II

In July, PSE&G filed for a 5-year extension of the GSMP which would accelerate the pace of replacement

of its aging cast iron and unprotected steel mains and associated service. PSE&G is proposing to invest

approximately $540 million per year, or up to $2.7 billion, over the 5-year program beginning in 2019. The

filing is consistent with the draft regulations that the BPU issued in June regarding Infrastructure

Investment Programs.

Energy Efficiency

In July, PSE&G reached an agreement in principle with BPU Staff and Rate Counsel related to its

proposed request to extend its investment in Energy Efficiency. Under the agreement, PSE&G would

invest $69 million in energy efficiency equipment for hospitals, multi-family housing and other sectors and

a residential energy efficiency offering for smart thermostats and data analytics. The agreement

represents more than 90% of PSE&G’s request.

18

PSE&G –

Q2 Operating Highlights

Filed for a 5-year extension and expansion of our Gas System Modernization Program

Agreement in principle reached on PSE&G’s Energy Efficiency filing provides a ~$69 million investment

PSE&G set to file its distribution base rate case with the BPU no later than November 1, 2017

Operations

Regulatory and Market

Environment

PSE&G’s Q2 2017 earnings increased by $0.06 or 17% to $0.41 per share 

PSE&G is on-track to meet its 2017 plan to invest approximately ~$3.4 billion to upgrade and expand

Transmission & Distribution infrastructure

PSE&G’s

2017

Net

Income

guidance

range

remains

unchanged

at

$945

-

$985

million

Financial

Total electric sales were flat on a weather normalized basis for the trailing 12 months ended June 30 

Total firm gas sales were slightly higher at 0.4% for the trailing 12 months ended June 30 due to

increased commercial sales

The first half of 2017 was the 3rd mildest in New Jersey state records with HDD ~9% below normal

and ~2% lower than first-half 2016

SEPA named PSE&G its 2017 Investor Owned Utility of the Year, recognizing its leadership in utility-scale

solar development on landfill and brownfield sites  

PSEG Power

2017 Q2 Review

20

$0.18

0.02

$0.19

$(0.02)

(0.01)

$(0.19)

-0.20

-0.10

0.00

0.10

0.20

0.30

Capacity  0.01

Higher Volume  0.01

Recontracting/

Lower Prices  (0.03)

PSEG Power EPS Reconciliation –

Q2 2017 versus Q2 2016

O&M 

* See Slide B for Items excluded from Net Income/(Loss) to reconcile to non-GAAP Operating Earnings for PSEG Power.

Q2 2016       

Operating

Earnings*

(non-GAAP)

Q2 2017       

Operating

Earnings*

(non-GAAP)

Fewer outage-related days and cost control offset lower prices

Q2 2017       

Net (Loss)

Q2 2016       

Net (Loss)

21

PSEG Power –

Q2 Generation increases 4%

6,983

7,566

912

1,360

4,551

4,025

0

5,000

10,000

15,000

2016

2017

Total Nuclear

Total Coal**

Natural Gas

* Excludes solar and Kalaeloa.   ** Includes figures for Pumped Storage.

PSEG Power –

Generation (GWh)*

12,446

12,951

PSEG Power –

Capacity Factors (%)

Quarter ended

June 30

2016

2017

Combined

Cycle

PJM and NY

62.3%

55.3%

Coal**

PA

57.0%

81.3%

CT

0.0%

0.9%

Nuclear

82.7%

89.6%

Quarter ended

June 30

($ millions)

2016

2017

Gas

$  64

$  83

Coal

$  22

$  31

Total Fossil

$  86

$  114

Nuclear

$  48

$  47

Total Fuel

Cost

$  134

$  161

Total

Generation

(GWh)

12,446

12,951

$ / MWh

10.77

12.43

PSEG Power –

Fuel Costs

22

PSEG Power –

First Half Generation in-line with year-ago

Total Nuclear

Total Coal**

Natural Gas

* Excludes solar and Kalaeloa.   ** Includes figures for Pumped Storage.

PSEG Power –

Generation (GWh)*

25,646

25,786

PSEG Power –

Capacity Factors (%)

PSEG Power –

Fuel Costs

15,402

15,921

1,939

2,794

8,305

7,071

0

5,000

10,000

15,000

20,000

25,000

30,000

2016

2017

Six months

ended June 30

($ millions)

2016

2017

Gas

$  131

$  162

Coal

$  49

$  65

Total Fossil

$  180

$  227

Nuclear

$  105

$  101

Total Fuel

Cost

$  285

$  328

Total

Generation

(GWh

)

25,646

25,786

$ / MWh

11.11

12.72

Six months

ended June 30

2016

2017

Combined

Cycle

PJM and NY

57.0%

48.5%

Coal**

PA

57.9%

82.5%

CT

3.0%

5.2%

Nuclear

91.2%

94.8%

23

PSEG Power –

Gross Margin Performance

$0

$10

$20

$30

$40

$50

2015

2016

2017

$36

Quarter ended June 30

PS Zone pricing improved over Q2 2016

Baffle bolt replacement outages completed at both Salem units

Capacity revenues were up slightly vs. Q2 2016 reflecting step-up in New England

capacity pricing to $232 MW/day  

Regional spark spreads compressed in the quarter

Q2 2017 had 46 nuclear refueling outage days vs. 76 outage days in Q2 2016

Regional Performance

Region

Q2 Gross

Margin ($M)

Q2 2017 Performance

PJM

$431

Higher generation offset by

recontracting at lower prices

New

England

$19

Higher generation and prices

New York

$17

Higher generation and market prices

offset by lower hedges

PSEG Power Gross Margin ($/MWh)

$40

$39

24

Hedging Update…

Contracted Energy*

* HEDGE

PERCENTAGES

AND

PRICES

AS

OF

JUNE

30,

2017.

REVENUES

OF

FULL

REQUIREMENT

LOAD

DEALS

BASED

ON

CONTRACT

PRICE,

INCLUDING

RENEWABLE

ENERGY

CREDITS,

ANCILLARY,

AND

TRANSMISSION

COMPONENTS

BUT

EXCLUDING

CAPACITY.

HEDGES

INCLUDE

POSITIONS

WITH

MTM

ACCOUNTING

TREATMENT

AND

OPTIONS.

Jul-Dec

2017

2018

2019

Volume TWh

17

34

34

Base Load

% Hedged

100%

100%

40-45%

(Nuclear and Base Load Coal)

Price $/MWh

$46

$41

$41

Volume TWh

7

18

23

Intermediate, Combined Cycle,

% Hedged

60-65%

0%

0%

Peaking

Price $/MWh

$46

$ -

$ -

Volume TWh

20-25

52-54

58-60

Total

% Hedged

85-90%

65-70%

25-30%

Price $/MWh

$46

$41

$41

25

PSEG Power –

Q2 Operating Highlights

Q2 output up 4% with shorter Salem 2 refueling outage versus the extended Salem 1 outage in Q2 2016;

baffle bolt inspection and replacement addressed at Salem 2 this Spring  

Nuclear fleet achieved average capacity factor of 89.6% in Q2, producing 7.6 TWh of energy

CCGT fleet capacity factor was 55.3% versus 62.3% in Q2 2016, CCGT availability remained strong at

~90% and produced 4.0 TWh of energy; Coal capacity factor up in PA on higher market demand, coal

fleet produced 1.4 TWh of energy

Operations

Regulatory and Market

Environment

Financial

The 2020/2021 RPM auction (with 100% Capacity Performance requirement) resulted in a higher

average price of $174 MW/day for 7,800 MW that cleared the auction

2017 expected generation output on track for 49-50 TWh; BGS load projected at 11 TWh

Recent court actions in New York and Illinois affirm state initiatives supporting Zero Emissions Credits

Construction on schedule and on budget at Keys and Sewaren 7 for targeted 2018 in-service;

Bridgeport Harbor 5 progressing on schedule for targeted 2019 operations

Power’s total debt as a percentage of capitalization at June 30 was 31%

Power’s

2017

non-GAAP

Operating

Earnings

guidance

range

remains

unchanged

at

$435

-

$510

million;

non-GAAP Adjusted EBITDA guidance for 2017 remains unchanged at $1,080 to $1,210 million

PSEG

27

PSEG Financial Highlights

PSE&G earnings forecast to grow 8.5% to comprise 66% of PSEG’s 2017 

non-GAAP Operating Earnings

PSEG’s 5-Year capital spending forecast of $15 billion over 2017 –

2021

to be invested in PSE&G (82%) and Power (18%)

PSE&G successfully executing regulatory/policy initiatives supporting

its 5-year, 7 -

9% annual growth in rate base

PSEG Power’s $2 billion investment in new generation, located in PJM

and New England, will improve fleet efficiency and geographic diversity

Moody’s upgraded PSEG’s senior unsecured credit rating to Baa1,

the

rating outlook is Stable; subsidiary company ratings were affirmed

Increased 2017 indicative common dividend by 4.9% to $1.72 per share

Financial position remains strong:

Cash from Power and increasing cash flow from operations at PSE&G supports

dividend growth and funds capital spending program without the need to issue equity

Debt as a percentage of capitalization was 49% at June 30

Reiterating

2017

non-GAAP

Operating

Earnings

guidance

of

$2.80

-

$3.00

per

share

28

PSEG 2017 Guidance -

By Subsidiary

$ millions (except EPS)

2017E

2016

PSE&G (Net Income)

$945 -

$985

$889

PSEG Power

$435 -

$510

$514

PSEG Enterprise/Other

$35 -

$35

$72

Operating Earnings (non-GAAP)*

$1,415 -

$1,530

$1,475

Operating EPS (non-GAAP)*

$2.80 -

$3.00E

$2.90

Segment Operating Earnings Guidance and Prior Results

(non-GAAP, except as noted)*

$ millions

2017E

2016

PSEG Power

$1,080 -

$1,210

$1,201

PSEG Power Adjusted EBITDA (non-GAAP)*

* See Slide A for Items excluded from Net Income to reconcile to Operating Earnings (non-GAAP) and Slide B for Items excluded from Net Income/(Loss) to reconcile to Operating

Earnings (non-GAAP) and Adjusted EBITDA (non-GAAP).  E = Estimate. 

PSEG Liquidity as of June 30, 2017

29

Reconciliation of Non-GAAP Operating Earnings

Please see Slide 2 for an explanation of PSEG’s use of Operating Earnings as a non-GAAP financial measure

and how it differs from Net Income.

A

B

Reconciliation of Non-GAAP Operating Earnings and Non-GAAP

Adjusted EBITDA

Please see Slide 2 for an explanation of PSEG’s use of Operating Earnings and Adjusted EBITDA as non-GAAP financial measures and

how they differ from Net Income/(Loss).