PUBLIC SERVICE ENTERPRISE GROUP INC

The following discussion of our liquidity and capital resources is on a consolidated basis, noting the uses and contributions, where material, of our two direct major operating subsidiaries.

Operating Cash Flows

We continue to expect our operating cash flows combined with cash on hand and financing activities to be sufficient to fund planned capital expenditures and shareholder dividends.

For the three months ended March 31, 2025, our operating cash flow increased $388 million, as compared to the same period in 2024. The net increase was primarily due to a net change at PSE&G, as discussed below, combined with $79 million in lower net cash collateral postings in 2025 as compared to the same period in 2024 at PSEG Power and higher tax refunds.

PSE&G

PSE&G’s operating cash flow increased $224 million from $408 million to $632 million for the three months ended March 31, 2025, as compared to the same period in 2024. The increase was due primarily to a net increase in regulatory deferrals, materials and supplies inventory management and timing of vendor payments.

Short-Term Liquidity

PSEG meets its short-term liquidity requirements, as well as those of PSEG Power, primarily through the issuance of commercial paper and, from time to time, short-term loans. PSE&G maintains its own separate commercial paper program to meet its short-term liquidity requirements. Each commercial paper program is fully back-stopped by its own separate credit facility.

Each of our credit facilities is restricted as to availability and use to the specific companies as listed below; however, if necessary, the PSEG facilities can also be used to support our subsidiaries’ liquidity needs.

In March 2025, PSEG, PSEG Power and PSE&G executed a one year extension to their existing $3.75 billion revolving credit facilities, extending the maturity through March 2029 and PSEG Power amended certain provisions in the Master Credit Facility including removal of subsidiary guarantees of PSEG Power obligations. The PSEG Power letter of credit facilities and term loans were also amended to be consistent with the Master Credit Facility, and the uncommitted credit facility at a subsidiary of PSEG Power was terminated.

Our total committed credit facilities and available liquidity as of March 31, 2025 were as follows:

PSEG Power has uncommitted credit facilities totaling $200 million, which can be utilized for letters of credit. As of March 31, 2025, PSEG Power had $112 million in letters of credit outstanding under these uncommitted credit facilities.

We continually monitor our liquidity and seek to add capacity as needed to meet our liquidity requirements, including to satisfy any additional collateral requirements. As of March 31, 2025, our liquidity position, including our credit facilities and access to external financing, was expected to be sufficient to meet our projected stressed requirements over our 12-month planning horizon. PSEG analyzes its liquidity requirements using stress scenarios that consider different events, including changes in commodity prices and the potential impact of PSEG Power losing its investment grade credit rating from S&P or Moody’s, which would represent a two-level downgrade from its current Moody’s and S&P ratings. In the event of a deterioration of PSEG Power’s credit rating, certain of PSEG Power’s agreements allow the counterparty to demand further performance assurance. The potential additional collateral that we would be required to post under these agreements if PSEG Power were to lose its investment grade credit rating was approximately $722 million and $618 million as of March 31, 2025 and December 31, 2024, respectively.

For additional information, see Item 1. Note 9. Debt and Credit Facilities.

Long-Term Debt Financing

During the next twelve months,

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PSEG has $550 million of 0.80% Senior Notes maturing in August 2025,

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PSE&G has $350 million of 3.00% Secured Medium-Term Notes, Series K, due May 2025,

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PSE&G has $450 million of 0.95% Secured Medium-Term Notes Series N, due March 2026, and

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PSEG Power has $1.25 billion of a variable rate term loan due June 2025.

PSEG, PSEG Power, Energy Holdings, PSEG LI and Services participate in a corporate money pool, an aggregation of daily cash balances designed to efficiently manage their respective short-term liquidity needs, which are accounted for as intercompany loans. Servco does not participate in the corporate money pool. Servco’s short-term liquidity needs are met through an account funded and owned by LIPA.

For additional information see Item 1. Note 9. Debt and Credit Facilities.

Common Stock Dividends

On April 22, 2025, our Board of Directors approved a $0.63 per share common stock dividend for the second quarter of 2025. This reflects an indicative annual dividend rate of $2.52 per share. We expect to continue to pay cash dividends on our common stock; however, the declaration and payment of future dividends to holders of our common stock will be at the discretion of the Board of Directors and will depend upon many factors, including our financial condition, earnings, capital requirements of our businesses, alternate investment opportunities, legal requirements, regulatory constraints, industry practice and other factors that the Board of Directors deems relevant. For additional information related to cash dividends on our common stock, see Item 1. Note 15. Earnings Per Share (EPS) and Dividends.

Credit Ratings

If the rating agencies lower or withdraw our credit ratings, such revisions may adversely affect the market price of our securities and serve to materially increase our cost of capital and limit access to capital. Credit Ratings shown are for securities that we typically issue. Outlooks are shown for the credit ratings at each entity and can be Stable, Negative, or Positive. There is no assurance that the ratings will continue for any given period of time or that they will not be revised by the rating agencies, if in their respective judgments, circumstances warrant. Each rating given by an agency should be evaluated independently of the other agencies’ ratings. The ratings should not be construed as an indication to buy, hold or sell any security.

(A)

Moody’s ratings range from Aaa (highest) to C (lowest) for long-term securities and P1 (highest) to NP (lowest) for short-term securities.

(B)

S&P ratings range from AAA (highest) to D (lowest) for long-term securities and A1 (highest) to D (lowest) for short-term securities.