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, 2024, our operating cash flow decreased $1,176 million, as compared to the same period in 2023. The net decrease was primarily due to an outflow of $168 million in net cash collateral postings in 2024 as compared to a $794 million inflow in 2023 at PSEG Power and lower tax refunds, partially offset by a net change at PSE&G, as discussed below.

PSE&G

PSE&G’s operating cash flow increased $30 million from $378 million to $408 million for the three months ended March 31, 2024, as compared to the same period in 2023. The increase was due primarily to higher cash collateral postings returned to BGS suppliers in 2023, partially offset by an increase in net accounts receivable and unbilled revenues and a net increase in regulatory deferrals.

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 2024, 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 2028.

Our total committed credit facilities and available liquidity as of March 31, 2024 were as follows:

PSEG Power has an uncommitted credit facility for $100 million, which can be utilized for letters of credit. A subsidiary of PSEG Power has an uncommitted credit facility for $150 million, which can be utilized for cash collateral postings. As of March 31, 2024, there were an no outstanding balances under these 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, 2024, 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 $690 million and $751 million as of March 31, 2024 and December 31, 2023, respectively.

For additional information, see Item 1. Note 10. Debt and Credit Facilities.

Long-Term Debt Financing

During the next twelve months,

•PSEG has $750 million of 2.88% Senior Notes maturing in June 2024,

•PSE&G has $250 million of 3.15% Secured Medium-Term Notes, Series J, due August 2024,

•PSE&G has $250 million of 3.05% Secured Medium-Term Notes, Series J, due November 2024, and

•PSEG Power has a $1.25 billion term loan due March 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 10. Debt and Credit Facilities.

Common Stock Dividends

On April 16, 2024, PSEG’s Board of Directors approved a $0.60 per share common stock dividend for the second quarter of 2024. This reflects an indicative annual dividend rate of $2.40 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 16. 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.