(Mark
One)
|
|
x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For
the Fiscal Year Ended December 31, 2008
|
|
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
|
Exact
Name of Registrant
as
specified in its charter
|
State
or Other Jurisdiction of
Incorporation
or Organization
|
IRS
Employer
Identification
Number
|
|||
1-12609
|
PG&E
CORPORATION
|
California
|
94-3234914
|
|||
1-2348
|
PACIFIC
GAS AND ELECTRIC COMPANY
|
California
|
94-0742640
|
One
Market, Spear Tower
Suite
2400
San
Francisco, California 94105
(Address
of principal executive offices) (Zip Code)
(415)
267-7000
(Registrant's
telephone number, including area code)
|
77
Beale Street, P.O. Box 770000
San
Francisco, California 94177
(Address
of principal executive offices) (Zip Code)
(415)
973-7000
(Registrant's
telephone number, including area
code)
|
Title
of Each Class
|
Name
of Each Exchange on Which Registered
|
|
PG&E Corporation:
Common Stock, no par value
|
New
York Stock Exchange
|
|
Pacific Gas and Electric
Company:
First Preferred Stock,
cumulative,
par value $25 per share:
|
NYSE
Alternext
|
|
Redeemable:
5% Series A, 5%, 4.80%, 4.50%, 4.36%
|
||
Nonredeemable:
6%, 5.50%, 5%
|
PG&E
Corporation
|
Yes
x
No
|
Pacific
Gas and Electric Company
|
Yes
x
No
|
PG&E
Corporation
|
Yes
No
x
|
Pacific
Gas and Electric Company
|
Yes
No
x
|
PG&E
Corporation
|
Yes
x
No
|
Pacific
Gas and Electric Company
|
Yes
x
No
|
PG&E
Corporation
|
x
|
Pacific
Gas and Electric Company
|
x
|
PG&E
Corporation
|
Pacific
Gas and Electric Company
|
|
Large
accelerated filer
x
|
Large
accelerated filer
|
|
Accelerated
filer
|
Accelerated
filer
|
|
Non-accelerated
filer
|
Non-accelerated
filer
x
|
|
Smaller
reporting company
|
Smaller
reporting company
|
PG&E
Corporation
|
Yes
No
x
|
Pacific
Gas and Electric Company
|
Yes
No
x
|
PG&E
Corporation Common Stock
|
$14,179
million
|
Pacific
Gas and Electric Company Common Stock
|
Wholly
owned by PG&E Corporation
|
Common
Stock outstanding as of February 20, 2009:
|
PG&E
Corporation:
|
365,764,340
shares
|
Pacific
Gas and Electric Company:
|
264,374,809
shares (wholly owned by PG&E
Corporation)
|
Designated
portions of the combined 2008 Annual Report to
Shareholders
|
Part I
(Items 1 and 1.A.), Part II (Items 5, 6, 7, 7A, 8 and
9A)
|
Designated
portions of the Joint Proxy Statement relating to the 2009 Annual Meetings
of Shareholders
|
Part III
(Items 10, 11, 12, 13 and 14)
|
Page
|
||
iii
|
||
1
|
||
1
|
||
1
|
||
1
|
||
1
|
||
1
|
||
3
|
||
3
|
||
3
|
||
4
|
||
4
|
||
5
|
||
7
|
||
7
|
||
7
|
||
9
|
||
10
|
||
10
|
||
10
|
||
10
|
||
10
|
||
11
|
||
11
|
||
11
|
||
Energy
Efficiency Programs
|
11
|
|
Demand
Response Programs
|
12
|
|
Self-Generation
Incentive Program and California Solar Initiative
|
12
|
|
Low-Income
Energy Efficiency Programs and California Alternate Rates for
Energy
|
12
|
|
13
|
||
13
|
||
13
|
||
14
|
||
14
|
||
14
|
||
14
|
||
15
|
||
15
|
||
15
|
||
16
|
||
16
|
||
16
|
||
16
|
||
17
|
||
18
|
||
18
|
||
19
|
||
19
|
||
20
|
||
20
|
||
21
|
||
21
|
||
23
|
||
23
|
||
24
|
||
24
|
||
24
|
||
25
|
||
26
|
||
26
|
||
27
|
||
28
|
||
28
|
||
29
|
||
30
|
||
30
|
||
31
|
||
31
|
||
31
|
||
31
|
||
31
|
||
32
|
||
33
|
||
33
|
||
36
|
||
Item
6
.
|
37
|
|
Item
7
.
|
37
|
|
37
|
||
37
|
||
37
|
||
38
|
||
Item
9B
.
|
38
|
|
38
|
||
39
|
||
39
|
||
39
|
||
39
|
||
40
|
||
47
|
||
49
|
||
50
|
||
1
Kilowatt (kW)
|
=
|
One
thousand watts
|
1
Kilowatt-Hour (kWh)
|
=
|
One
kilowatt continuously for one hour
|
1
Megawatt (MW)
|
=
|
One
thousand kilowatts
|
1
Megawatt-Hour (MWh)
|
=
|
One
megawatt continuously for one hour
|
1
Gigawatt (GW)
|
=
|
One
million kilowatts
|
1
Gigawatt-Hour (GWh)
|
=
|
One
gigawatt continuously for one hour
|
1
Kilovolt (kV)
|
=
|
One
thousand volts
|
1
MVA
|
=
|
One
megavolt ampere
|
1
Mcf
|
=
|
One
thousand cubic feet
|
1
MMcf
|
=
|
One
million cubic feet
|
1
Bcf
|
=
|
One
billion cubic feet
|
1
MDth
|
=
|
One
thousand decatherms
|
·
|
the
Utility’s ability to manage capital expenditures and its operating and
maintenance expenses within authorized levels;
|
·
|
the
outcome of pending and future regulatory proceedings and whether the
Utility is able to timely recover its costs through
rates;
|
·
|
the
adequacy and price of electricity and natural gas supplies, and the
ability of the Utility to manage and respond to the volatility of the
electricity and natural gas markets including the ability of the Utility
and its counterparties to post or return collateral;
|
·
|
the
effect of weather, storms, earthquakes, fires, floods, disease, other
natural disasters, explosions, accidents, mechanical breakdowns, acts of
terrorism, and other events or hazards on the Utility’s facilities and
operations, its customers, and third parties on which the Utility
relies;
|
·
|
the
potential impacts of climate change on the Utility’s electricity and
natural gas businesses;
|
·
|
changes
in customer demand for electricity and natural gas resulting from
unanticipated population growth or decline, general economic and financial
market conditions, changes in technology, including the development of
alternative energy sources, or other reasons;
|
·
|
operating
performance of Diablo Canyon, the availability of nuclear fuel, the
occurrence of unplanned outages at Diablo Canyon, or the temporary or
permanent cessation of operations at Diablo Canyon;
|
·
|
whether
the Utility can maintain the cost savings it has recognized from operating
efficiencies it has achieved and identify and successfully implement
additional sustainable cost-saving measures;
|
·
|
whether
the Utility incurs substantial expense to improve the safety and
reliability of its electric and natural gas systems;
|
·
|
whether
the Utility achieves the CPUC’s energy efficiency targets and recognizes
any incentives the Utility may earn in a timely manner;
|
·
|
the
impact of changes in federal or state laws, or their interpretation, on
energy policy and the regulation of utilities and their holding
companies;
|
·
|
the
impact of changing wholesale electric or gas market rules, including new
rules of the California Independent System Operator (“CAISO”) to
restructure the California wholesale electricity
market;
|
·
|
how
the CPUC administers the conditions imposed on PG&E Corporation when
it became the Utility’s holding company;
|
·
|
the
extent to which PG&E Corporation or the Utility incurs costs and
liabilities in connection with litigation that are not recoverable through
rates, from insurance, or from other third parties;
|
·
|
the
ability of PG&E Corporation, the Utility, and counterparties to access
capital markets and other sources of credit in a timely manner on
acceptable terms, especially given the recent deteriorating conditions in
the economy and financial markets;
|
·
|
the
impact of environmental laws and regulations and the costs of compliance
and remediation;
|
·
|
the
effect of municipalization, direct access, community choice aggregation,
or other forms of bypass; and
|
·
|
the
impact of changes in federal or state tax laws, policies, or
regulations.
|
·
|
the
Utility cannot guarantee any obligations of PG&E Corporation without
prior written consent from the
CPUC;
|
·
|
the
Utility's dividend policy must be established by the Utility's Board of
Directors as though the Utility were a stand-alone utility
company;
|
·
|
the
capital requirements of the Utility, as determined to be necessary and
prudent to meet the Utility's obligation to serve or to operate the
Utility in a prudent and efficient manner, must be given first priority by
PG&E Corporation's Board of Directors (known as the “first priority”
condition); and
|
·
|
the
Utility must maintain on average its CPUC-authorized utility capital
structure, although it can request a waiver of this condition if an
adverse financial event reduces the Utility's common equity component by
1% or more.
|
·
|
emphasize
that the holding company may not aid or abet a utility's violation of the
rules or act as a conduit to provide confidential utility information to
an affiliate;
|
·
|
require
prior CPUC approval before the utility can contract with an affiliate for
resource procurement (
e.g.,
electricity or
gas), except in blind transactions where the identity of the other party
is not known until the transaction is consummated;
|
·
|
require
certain key officers to provide annual certifications of compliance with
the affiliate rules;
|
·
|
prohibit
certain key officers from serving in the same position at both the utility
and the holding company (unless otherwise permitted by the CPUC), or, in
the alternative, prohibit the sharing of lobbying, regulatory relations
and certain legal services (except for legal services necessary to the
provision of permitted shared services);
|
·
|
require
the utility to obtain a “nonconsolidation opinion” indicating that it
would not be consolidated into a bankruptcy of its holding company;
and
|
·
|
make the CPUC's Energy Division responsible for hiring independent auditors to conduct biennial audits to verify that the utility is in compliance with the affiliate rules. |
·
|
Assembly Bill
1890.
Assembly Bill 1890, enacted in 1996, mandated the
restructuring of the California electricity industry, commencing in 1998,
which was intended to create a competitive market for electricity
generation and give customers of the investor-owned utilities the ability
to choose “direct access” by buying energy from a service provider other
than the regulated utilities. (Subsequent legislation,
described below, suspended direct access during the California energy
crisis of 2000-2001.) Among other provisions, Assembly Bill
1890 also provided for the establishment of the CAISO, as a nonprofit
public benefit corporation, to operate and control the state-wide
electricity transmission grid and ensure efficient use and reliable
operation of the transmission grid.
|
·
|
Assembly Bill
1X.
Assembly Bill 1X was enacted during the
California 2000-2001 energy crisis when the California investor-owned
electric utilities were no longer able to buy
electricity. Assembly Bill 1X authorized the California
Department of Water Resources (“DWR”) beginning on February 1, 2001,
to purchase electricity and sell that electricity directly to the
investor-owned electric utilities' retail customers. Assembly Bill 1X
required the California investor-owned electric utilities to deliver
electricity purchased by the DWR under the contracts and to act as the
DWR's billing and collection agent. To ensure that the DWR
recovers its costs to procure electricity, Assembly Bill 1X required the
CPUC to suspend the right of retail end-user customers to become direct
access customers until the DWR no longer procures electricity pursuant to
Assembly Bill 1X. The current DWR contracts terminate at
various dates through
2015.
|
·
|
Assembly Bill 57.
Assembly Bill 57, enacted in September 2002 and
amended by Senate Bill 1976, required the California investor-owned
utilities to resume purchasing power on January 1, 2003, required the CPUC
to allocate electricity to be provided under the DWR contracts among the
customers of the California investor-owned electric utilities, requires
the utilities to file short- and long-term electricity resource
procurement plans with the CPUC for approval, and authorizes the utilities
to timely recover their reasonable wholesale procurement costs incurred
under a CPUC-approved procurement plan through the establishment of new
electricity procurement balancing accounts that reflect differences
between recorded revenues and costs incurred under the approved
procurement plans.
|
·
|
Senate Bill
1078.
Senate Bill 1078, enacted in September 2002
(as amended by Senate Bill 107, enacted in September 2006 and effective on
January 1, 2007) established the renewables portfolio standard (“RPS”)
program, which requires each California retail seller of electricity,
except municipal utilities, to increase its purchases of eligible
renewable energy (such as
biomass,
|
·
|
small
hydroelectric, wind, solar and geothermal energy) by at least 1% of its
retail sales, so that the amount of electricity purchased from eligible
renewable resources equals at least 20% of its total retail sales by the
end of 2010. An unexcused failure to satisfy the RPS targets
may result in a penalty of five cents per kilowatt hour with an annual
penalty cap of $25 million. The California Legislature is
considering proposals to increase the RPS mandate to at least 33% by
2020.
|
·
|
Assembly Bill 380.
Assembly Bill 380, enacted in September 2005, requires the CPUC, in
consultation with the CAISO, to establish resource adequacy requirements
for all load-serving entities, including the California investor-owned
electric utilities but excluding local publicly owned electric
utilities. Assembly Bill 380 requires each load-serving entity
to maintain physical generating capacity adequate to meet its load
requirements, including peak demand and planning and operating reserves,
deliverable to locations and at times as may be necessary to provide
reliable electric service.
|
·
|
Assembly Bill
32.
Assembly Bill 32, enacted in September 2006,
requires the California Air Resources Board (“CARB”) to adopt regulations
to limit statewide greenhouse gas emission, to 1990 levels by 2020, with
certain limits beginning in 2012. (See “Environmental Matters”
below for more information.)
|
·
|
Senate Bill
1368.
Senate Bill 1368, also enacted in September 2006,
prohibits any load-serving entity, including investor-owned electric
utilities, from entering into a long-term financial commitment for
baseload generation (
i.e.,
electricity
generation from a power plant that is designed and intended to provide
electricity at an annualized plant capacity factor of at least 60%) unless
it complies with a greenhouse gas emission performance
standard. (See “Environmental Matters” below for more
information.)
|
·
|
Energy Efficiency
Programs
. The Utility’s energy efficiency programs are designed to
encourage the manufacture, design, distribution and customer use of energy
efficient appliances and other energy-using products. The CPUC authorized
funding of $403 million for 2008 gas and electric programs, including
funding for the CEC-administered programs. The Utility intends to file an
amended application on March 2, 2009 to seek CPUC approval and funding
authorization of approximately $1.8 billion for the Utility’s 2009-2011
energy efficiency programs, an approximate increase of $860 million over
the 2006-2008 budget. On October 16, 2008, the CPUC authorized
bridge funding for 2009 of $394.9 million to allow the Utility to continue
existing energy efficiency programs until the CPUC issues a final decision
on the 2009-2011 application.
|
·
|
Demand Response Programs.
Demand response programs provide financial incentives and other
benefits to participating customers to curtail on-peak energy use. The
2008 authorized funding for Demand Response Programs was $38 million.
The CPUC has not
yet approved the Utility’s request for funding of approximately $148
million for the Utility’s 2009-2011 demand response
programs. On December 18, 2008, the CPUC authorized bridge
funding of $41 million to continue certain demand response programs in
2009 until a final decision is issued on the Utility’s
request.
|
·
|
Self-Generation Incentive
Program and California Solar Initiative.
The
Utility administers the self-generation incentive program (“SGIP”)
authorized by the CPUC to provide incentives to electricity customers who
install certain types of clean or renewable distributed generation
resources that meet all or a portion of their onsite energy
usage. The CPUC approved a budget for the SGIP of approximately
$36 million in each of 2008 and 2009. In late 2006, the CPUC also
established the California Solar Initiative (“CSI”) to bring 1,940 MW of
solar power on-line by 2017 in California and authorized the California
investor-owned utilities to collect an additional $2.2 billion over the
2007 through 2016 period from their customers to fund customer incentives
for the installation of retail solar energy projects to serve onsite load
to meet this goal. Of the total amount authorized, the Utility
has been allocated $946 million to fund customer incentives, research,
development and demonstration activities (with an emphasis on the
demonstration of solar and solar-related technologies), and administration
expenses. The California Legislature modified the CSI program
to include participation of the California municipal utilities. The
current overall goal of the CSI is to install 3,000 MW (through both
investor-owned electric utilities and electric municipal utilities)
through 2017.
|
·
|
Low-Income Energy Efficiency
Programs and California Alternate Rates for Energy.
The
CPUC authorized the Utility to collect approximately $86 million for these
programs in 2008. The CPUC has authorized the Utility to
collect approximately $422 million to support the Utility’s energy
efficiency programs for low-income and fixed-income customers over
2009-2011. The Utility also provides a discount rate called the
California Alternate Rates for Energy (“CARE”) for low-income
customers. This rate subsidy is paid for by the Utility's other
customers. The extent of the subsidy, during any given year,
depends upon the number of customers participating in the
program. In 2008, the amount of this subsidy was approximately
$526.6 million, including avoided customer surcharges. The CPUC
also authorized the Utility to recover approximately $28 million in
administrative costs relating to the CARE subsidy over
2009-2011.
|
·
|
the
proceeds received from the CAISO for wholesale wheeling service (
i.e.,
the transfer of
electricity that is being sold in the wholesale market) that the CAISO
provides to third parties using the Utility’s transmission facilities,
and
|
·
|
revenues
that the CAISO collects from transmission users to relieve congestion on
the Utility’s transmission line (either in the form of financial hedges,
such as firm transmission rights relating to future deliveries of
electricity, or in the form of a usage charge to manage congestion
relating to real-time delivery of
electricity).
|
Owned
generation (nuclear, fossil fuel-fired and hydroelectric
facilities)
|
30%
|
DWR
|
15%
|
Qualifying
Facilities/Renewables
|
18%
|
Irrigation
Districts
|
2%
|
Other
Power Purchases
|
35%
|
Generation
Type
|
County
Location
|
Number
of
Units
|
Net
Operating
Capacity
(MW)
|
|||
Nuclear:
|
||||||
Diablo
Canyon
|
San
Luis Obispo
|
2
|
2,240
|
|||
Hydroelectric:
|
||||||
Conventional
|
16
counties in northern
and
central California
|
107
|
2,684
|
|||
Helms
pumped storage
|
Fresno
|
3
|
1,212
|
|||
Hydroelectric
subtotal
|
110
|
3,896
|
||||
Fossil
fuel:
|
||||||
Humboldt
Bay
(1)
|
Humboldt
|
2
|
105
|
|||
Mobile
turbines
|
Humboldt
|
2
|
30
|
|||
Fossil
fuel subtotal
|
4
|
135
|
||||
Total
|
116
|
6,271
|
2009
|
2010
|
2011
|
2012
|
2013
|
|||||
Unit
1
|
|||||||||
Refueling
|
January
|
October
|
April
|
||||||
Duration
(days)
|
76
|
35
|
30
|
||||||
Startup
|
April
|
November
|
May
|
||||||
Unit
2
|
|||||||||
Refueling
|
October
|
-
|
May
|
February
|
|||||
Duration
(days)
|
35
|
-
|
30
|
30
|
|||||
Startup
|
November
|
-
|
June
|
March
|
Agricultural
and Other Customers
|
7%
|
Industrial
Customers
|
18%
|
Residential
Customers
|
36%
|
Commercial
Customers
|
39%
|
2008
|
2007
|
2006
|
2005
|
2004
|
||||||||||||||||
Customers
(average for the year):
|
||||||||||||||||||||
Residential
|
4,488,884 | 4,464,483 | 4,417,638 | 4,353,458 | 4,366,897 | |||||||||||||||
Commercial
|
527,045 | 521,732 | 515,297 | 509,786 | 509,501 | |||||||||||||||
Industrial
|
1,265 | 1,261 | 1,212 | 1,271 | 1,339 | |||||||||||||||
Agricultural
|
81,757 | 80,366 | 79,006 | 78,876 | 80,276 | |||||||||||||||
Public
street and highway lighting
|
30,474 | 29,643 | 28,799 | 28,021 | 27,176 | |||||||||||||||
Other
electric utilities
|
2 | 2 | 4 | 4 | 3 | |||||||||||||||
Total
(1)
|
5,129,427 | 5,097,487 | 5,041,956 | 4,971,416 | 4,985,192 | |||||||||||||||
Deliveries
(in GWh):
(2)
|
||||||||||||||||||||
Residential
|
31,454 | 30,796 | 31,014 | 29,752 | 29,453 | |||||||||||||||
Commercial
|
34,053 | 33,986 | 33,492 | 32,375 | 32,268 | |||||||||||||||
Industrial
|
16,148 | 15,159 | 15,166 | 14,932 | 14,796 | |||||||||||||||
Agricultural
|
5,594 | 5,402 | 3,839 | 3,742 | 4,300 | |||||||||||||||
Public
street and highway lighting
|
877 | 833 | 785 | 792 | 2,091 | |||||||||||||||
Other
electric utilities
|
1 | 3 | 14 | 33 | 28 | |||||||||||||||
Subtotal
|
88,127 | 86,179 | 84,310 | 81,626 | 82,936 | |||||||||||||||
California
Department of Water Resources (DWR)
|
(13,344 | ) | (21,193 | ) | (19,585 | ) | (20,476 | ) | (19,938 | ) | ||||||||||
Total
non-DWR electricity
|
74,783 | 64,986 | 64,725 | 61,150 | 62,998 | |||||||||||||||
Revenues
(in millions):
|
||||||||||||||||||||
Residential
|
$ | 4,656 | $ | 4,580 | $ | 4,491 | $ | 3,856 | $ | 3,718 | ||||||||||
Commercial
|
4,413 | 4,484 | 4,414 | 4,114 | 4,179 | |||||||||||||||
Industrial
|
1,400 | 1,252 | 1,293 | 1,232 | 1,204 | |||||||||||||||
Agricultural
|
727 | 664 | 483 | 446 | 491 | |||||||||||||||
Public
street and highway lighting
|
75 | 78 | 72 | 66 | 71 | |||||||||||||||
Other
electric utilities
|
126 | 85 | 59 | 4 | 22 | |||||||||||||||
Subtotal
|
11,397 | 11,143 | 10,812 | 9,718 | 9,685 | |||||||||||||||
DWR
|
(1,325 | ) | (2,229 | ) | (2,119 | ) | (1,699 | ) | (1,933 | ) | ||||||||||
Direct
access credits
|
— | — | — | — | — | |||||||||||||||
Miscellaneous
|
336 | 215 | 261 | 235 | (248 | ) | ||||||||||||||
Regulatory
balancing accounts
|
330 | 352 | (202 | ) | (327 | ) | 363 | |||||||||||||
Total
electricity operating revenues
|
$ | 10,738 | $ | 9,481 | $ | 8,752 | $ | 7,927 | $ | 7,867 | ||||||||||
Other
Data:
|
||||||||||||||||||||
Average
annual residential usage (kWh)
|
7,007 | 6,898 | 7,020 | 6,834 | 6,744 | |||||||||||||||
Average
billed revenues (cents per kWh):
|
||||||||||||||||||||
Residential
|
14.80 | 14.87 | 14.48 | 12.96 | 12.62 | |||||||||||||||
Commercial
|
12.96 | 13.19 | 13.18 | 12.71 | 12.95 | |||||||||||||||
Industrial
|
8.67 | 8.26 | 8.53 | 8.25 | 8.14 | |||||||||||||||
Agricultural
|
13.00 | 12.29 | 12.58 | 11.92 | 11.41 | |||||||||||||||
Net
plant investment per customer
|
$ | 3,994 | $ | 3,418 | $ | 3,148 | $ | 2,966 | $ | 2,790 |
(1)
|
Starting
in 2005, the Utility’s methodology used to count customers changed from
the number of billings to the number of active service
agreements.
|
(2)
|
These
amounts include electricity provided to direct access customers who
procure their own supplies of
electricity.
|
Residential
Customers
|
26%
|
Transport-only
Customers (non-core)
|
63%
|
Commercial
Customers
|
11%
|
2008
|
2007
|
2006
|
2005
|
2004
|
||||||||||||||||
Customers
(average for the year):
|
||||||||||||||||||||
Residential
|
4,043,616 | 4,030,499 | 3,989,331 | 3,929,117 | 3,812,914 | |||||||||||||||
Commercial
|
224,617 | 223,330 | 220,024 | 216,749 | 215,547 | |||||||||||||||
Industrial
|
926 | 958 | 988 | 962 | 2,178 | |||||||||||||||
Other
gas utilities
|
6 | 6 | 6 | 6 | 6 | |||||||||||||||
Total
|
4,269,165 | 4,254,793 | 4,210,349 | 4,146,834 | 4,030,645 | |||||||||||||||
Gas
supply (MMcf):
|
||||||||||||||||||||
Purchased
from suppliers in:
|
||||||||||||||||||||
Canada
|
189,608 | 199,870 | 202,274 | 204,884 | 205,180 | |||||||||||||||
California
|
(53,126 | ) | (23,065 | ) | (13,401 | ) | (18,951 | ) | (9,108 | ) | ||||||||||
Other
states
|
123,833 | 101,271 | 103,658 | 103,237 | 103,801 | |||||||||||||||
Total
purchased
|
260,315 | 278,076 | 292,531 | 289,170 | 299,873 | |||||||||||||||
Net
(to storage) from storage
|
560 | (1,120 | ) | 4,359 | (3,659 | ) | (532 | ) | ||||||||||||
Total
|
260,875 | 276,956 | 296,890 | 285,511 | 299,341 | |||||||||||||||
Utility
use, losses, etc.
(1)
|
1,758 | (12,760 | ) | (27,610 | ) | (14,312 | ) | (19,287 | ) | |||||||||||
Net
gas for sales
|
262,633 | 264,196 | 269,280 | 271,199 | 280,054 | |||||||||||||||
Bundled
gas sales (MMcf):
|
||||||||||||||||||||
Residential
|
198,699 | 196,903 | 196,092 | 194,108 | 201,601 | |||||||||||||||
Commercial
|
63,934 | 67,293 | 73,178 | 77,056 | 78,080 | |||||||||||||||
Industrial
|
10 | 35 | 373 | |||||||||||||||||
Other
gas utilities
|
— | — | — | — | — | |||||||||||||||
Total
|
262,633 | 264,196 | 269,280 | 271,199 | 280,054 | |||||||||||||||
Transportation
only (MMcf):
|
569,535 | 605,259 | 559,270 | 572,869 | 597,706 | |||||||||||||||
Revenues
(in millions):
|
||||||||||||||||||||
Bundled
gas sales:
|
||||||||||||||||||||
Residential
|
$ | 2,574 | $ | 2,378 | $ | 2,452 | $ | 2,336 | $ | 1,944 | ||||||||||
Commercial
|
792 | 766 | 859 | 885 | 712 | |||||||||||||||
Industrial
|
||||||||||||||||||||
Other
gas utilities
|
||||||||||||||||||||
Miscellaneous
|
(30 | ) | 87 | 121 | (22 | ) | (29 | ) | ||||||||||||
Regulatory
balancing accounts
|
221 | 186 | 40 | 340 | 316 | |||||||||||||||
Bundled
gas revenues
|
3,557 | 3,417 | 3,472 | 3,539 | 2,943 | |||||||||||||||
Transportation
service only revenue
|
333 | 340 | 315 | 237 | 270 | |||||||||||||||
Operating
revenues
|
$ | 3,890 | $ | 3,757 | $ | 3,787 | $ | 3,776 | $ | 3,213 | ||||||||||
Selected
Statistics:
|
||||||||||||||||||||
Average
annual residential usage (Mcf)
|
49 | 49 | 49 | 49 | 53 | |||||||||||||||
Average
billed bundled gas sales revenues per Mcf:
|
||||||||||||||||||||
Residential
|
$ | 12.95 | $ | 12.07 | $ | 12.50 | $ | 12.04 | $ | 9.64 | ||||||||||
Commercial
|
12.38 | 11.38 | 11.73 | 11.48 | 9.12 | |||||||||||||||
Industrial
|
1.03 | 0.61 | (0.56 | ) | ||||||||||||||||
Average
billed transportation only revenue per Mcf
|
0.59 | 0.56 | 0.56 | 0.42 | 0.45 | |||||||||||||||
Net
plant investment per customer
|
$ | 1,344 | $ | 1,375 | $ | 1,304 | $ | 1,262 | $ | 1,266 | ||||||||||
(1)
|
Includes
fuel for the Utility's fossil fuel-fired generation
plants.
|
2008
|
2007
|
2006
|
2005
|
2004
|
|||||||||||
MMcf
|
Avg.
Price
|
MMcf
|
Avg.
Price
|
MMcf
|
Avg.
Price
|
MMcf
|
Avg.
Price
|
MMcf
|
Avg.
Price
|
||||||
Canada
|
189,608
|
$8.29
|
199,870
|
$6.63
|
202,274
|
$6.27
|
204,884
|
$7.12
|
205,180
|
$5.37
|
|||||
California
(1)
|
(53,126)
|
$9.24
|
(23,065)
|
$6.77
|
(13,401)
|
$7.04
|
(18,951)
|
$7.70
|
(9,108)
|
$4.89
|
|||||
Other
states (substantially all U.S. southwest)
|
123,833
|
$7.05
|
101,271
|
$6.30
|
103,658
|
$6.51
|
103,237
|
$7.10
|
103,801
|
$5.44
|
|||||
Total/weighted
average
|
260,315
|
$7.51
|
278,076
|
$6.50
|
292,531
|
$6.32
|
289,170
|
$7.07
|
299,873
|
$5.41
|
Pipeline
|
Expiration
Date
|
Quantity
MDth
per day
|
Demand
Charges
for
the Year Ended
December 31,
2008
(In
millions)
|
||||
TransCanada
NOVA Gas Transmission, Ltd.
|
10/31/2011
|
(1)
|
619
|
$29.5
|
|||
TransCanada
Foothills Pipe Lines Ltd., B.C. System
|
10/31/2011
|
611
|
15.7
|
||||
Gas
Transmission Northwest Corporation
|
10/31/2009
|
610
|
89.6
|
||||
Transwestern
Pipeline Company
(1)
|
Various
|
180
|
15.9
|
||||
El
Paso Natural Gas Company
(2)
|
Various
|
267
|
17.2
|
(1)
|
As
of December 31, 2008, the Utility had two active contracts with
Transwestern Pipeline Company with expiration dates ranging from February
28, 2009 to March 31, 2010.
|
(2)
|
As of December 31, 2008, the
Utility had three active contracts with El Paso Natural Gas Company with
expiration dates ranging from February 28, 2009 to June 30,
2012.
|
Expiration
Date
|
Quantity
MDth
per day
|
Estimated
Demand Charges
2009-2011
(In
millions)
|
||||
10/31/2011
|
250
|
$58
|
||||
10/31/2016
|
280
|
71
|
||||
10/31/2020
|
80
|
20
|
·
|
the
discharge of pollutants into air, water and
soil;
|
·
|
the
identification, generation, storage, handling, transportation, treatment,
disposal, record keeping, labeling, reporting, remediation and emergency
response in connection with hazardous and radioactive substances;
and
|
·
|
environmental
impacts of land use, including endangered species and habitat
protection.
|
Name
|
Age
|
Position
|
||
Peter
A. Darbee
|
56
|
Chairman
of the Board, Chief Executive Officer, and President
|
||
Kent
M. Harvey
|
50
|
Senior
Vice President and Chief Risk and Audit Officer
|
||
Christopher
P. Johns
|
48
|
Senior
Vice President, Chief Financial Officer, and Treasurer
|
||
John
S. Keenan
|
60
|
Senior
Vice President and Chief Operating Officer, Pacific Gas and
Electric Company
|
||
Nancy
E. McFadden
|
50
|
Senior
Vice President, Public Affairs
|
||
Hyun
Park
|
47
|
Senior
Vice President and General Counsel
|
||
Greg
S. Pruett
|
51
|
Senior
Vice President, Corporate Relations
|
||
Rand
L. Rosenberg
|
55
|
Senior
Vice President, Corporate Strategy and Development
|
||
John
R. Simon
|
44
|
Senior
Vice President, Human
Resources
|
Name
|
Position
|
Period
Held Office
|
||
Peter
A. Darbee
|
Chairman
of the Board, Chief Executive Officer, and President
|
September 19,
2007 to present
|
||
President
and Chief Executive Officer, Pacific Gas and Electric
Company
|
September
5, 2008 to present
|
|||
Chairman
of the Board and Chief Executive Officer
|
July
1, 2007 to September 18, 2007
|
|||
Chairman
of the Board, Chief Executive Officer, and President
|
January
1, 2006 to June 30, 2007
|
|||
Chairman
of the Board, Pacific Gas and Electric Company
|
January 1,
2006 to May 31, 2007
|
|||
President
and Chief Executive Officer
|
January 1,
2005 to December 31, 2005
|
|||
Senior
Vice President and Chief Financial Officer
|
September
20, 1999 to December 31, 2004
|
|||
Kent
M. Harvey
|
Senior
Vice President and Chief Risk and Audit Officer
|
October 1,
2005 to present
|
||
Senior
Vice President, Chief Financial Officer, and Treasurer, Pacific Gas
and Electric Company
|
November 1,
2000 to September 30, 2005
|
|||
Christopher
P. Johns
|
Senior
Vice President, Chief Financial Officer, and Treasurer
|
October 4,
2005 to present
|
||
Senior
Vice President and Treasurer, Pacific Gas and Electric
Company
|
June
1, 2007 to present
|
|||
Senior
Vice President, Chief Financial Officer, and Treasurer, Pacific Gas and
Electric Company
|
October 1,
2005 to May 31, 2007
|
|||
Senior
Vice President, Chief Financial Officer, and Controller
|
January 1,
2005 to October 3, 2005
|
|||
Senior
Vice President and Controller
|
September 19,
2001 to December 31, 2004
|
|||
John
S. Keenan
|
Senior
Vice President and Chief Operating Officer, Pacific Gas and Electric
Company
|
January
1, 2008 to present
|
||
Senior
Vice President, Generation and Chief Nuclear Officer, Pacific Gas and
Electric Company
|
December 19,
2005 to December 31, 2007
|
|||
Vice
President, Fossil Generation, Progress Energy
|
November 10,
2003 to December 18, 2005
|
|||
Nancy
E. McFadden
|
Senior
Vice President, Public Affairs
|
March
1, 2007 to present
|
||
Senior
Vice President, Public Affairs, Pacific Gas and Electric
Company
|
June
20, 2007 to present
|
|||
Vice
President, Governmental Relations, Pacific Gas and Electric
Company
|
September
26, 2005 to February 28, 2007
|
|||
Chairperson,
California Medical Assistance Commission
|
November
13, 2003 to November 30, 2005
|
|||
Hyun
Park
|
Senior
Vice President and General Counsel
|
November 13,
2006 to present
|
||
Vice
President, General Counsel, and Secretary, Allegheny Energy,
Inc.
|
April 5,
2005 to October 17, 2006
|
|||
Senior
Vice President, General Counsel, and Secretary, Sithe Energies,
Inc.
|
March
2000 to February 2005
|
|||
Greg
S. Pruett
|
Senior
Vice President, Corporate Relations
|
November
1, 2007 to present
|
||
Vice
President, Corporate Relations
|
March
1, 2007 to October 31, 2007
|
|||
Vice
President, Communications and Marketing, American Gas
Association
|
April
10, 2006 to February 23, 2007
|
|||
Chief
Public Affairs Officer, Bechtel National, Inc.
|
June
12, 2004 to September 12, 2005
|
|||
Vice
President, Corporate Communications, PG&E Corporation
|
January
1, 1998 to September 12, 2003
|
|||
Rand
L. Rosenberg
|
Senior
Vice President, Corporate Strategy and Development
|
November 1,
2005 to present
|
||
Executive
Vice President and Chief Financial Officer, Infospace,
Inc.
|
September
2000 to January 20, 2001
|
|||
John
R. Simon
|
Senior
Vice President, Human Resources
|
April
16, 2007 to present
|
||
Senior
Vice President, Human Resources, Pacific Gas and Electric
Company
|
April
16, 2007 to present
|
|||
Executive
Vice President, Global Human Capital, TeleTech Holdings,
Inc.
|
March
21, 2006 to April 13, 2007
|
|||
Senior
Vice President, Human Capital, TeleTech Holdings, Inc.
|
July
31, 2001 to March 20, 2006
|
Name
|
Age
|
Position
|
||
Peter
A. Darbee
|
56
|
President
and Chief Executive Officer
|
||
John
S. Keenan
|
60
|
Senior
Vice President and Chief Operating Officer
|
||
Desmond
A. Bell
|
46
|
Senior
Vice President, Shared Services and Chief Procurement
Officer
|
||
Thomas
E. Bottorff
|
55
|
Senior
Vice President, Regulatory Relations
|
||
Helen
A. Burt
|
52
|
Senior
Vice President and Chief Customer Officer
|
||
John
T. Conway
|
51
|
Senior
Vice President, Generation and Chief Nuclear Officer
|
||
Christopher
P. Johns
|
48
|
Senior
Vice President and Treasurer
|
||
Patricia
M. Lawicki
|
48
|
Senior
Vice President and Chief Information Officer
|
||
Nancy
E. McFadden
|
50
|
Senior
Vice President, Public Affairs
|
||
Hyun
Park
|
47
|
Senior
Vice President and General Counsel, PG&E
Corporation
|
||
Greg
S. Pruett
|
51
|
Senior
Vice President, Corporate Relations, PG&E
Corporation
|
||
Edward
A. Salas
|
52
|
Senior
Vice President, Engineering and Operations
|
||
John
R. Simon
|
44
|
Senior
Vice President, Human Resources
|
||
Fong
Wan
|
47
|
Senior
Vice President, Energy Procurement
|
||
Geisha
J. Williams
|
47
|
Senior
Vice President, Energy Delivery
|
||
Barbara
L. Barcon
|
52
|
Vice
President, Finance and Chief Financial
Officer
|
Name
|
Position
|
Period
Held Office
|
||
Peter
A. Darbee
|
President
and Chief Executive Officer
|
September
5, 2008 to present
|
||
Chairman
of the Board, Chief Executive Officer, and President, PG&E
Corporation
|
September
19, 2007 to present
|
|||
Chairman
of the Board and Chief Executive Officer, PG&E
Corporation
|
July
1, 2007 to September 18, 2007
|
|||
Chairman
of the Board, Pacific Gas and Electric Company
|
January 1,
2006 to May 31, 2007
|
|||
Chairman
of the Board, Chief Executive Officer, and President, PG&E
Corporation
|
January 1,
2006 to June 30, 2007
|
|||
President
and Chief Executive Officer, PG&E Corporation
|
January 1,
2005 to December 31, 2005
|
|||
Senior
Vice President and Chief Financial Officer, PG&E
Corporation
|
September
20, 1999 to December 31, 2004
|
|||
John
S. Keenan
|
Senior
Vice President and Chief Operating Officer
|
January
1, 2008 to present
|
||
Senior
Vice President, Generation and Chief Nuclear Officer
|
December 19,
2005 to December 31, 2007
|
|||
Vice
President, Fossil Generation, Progress Energy
|
November 10,
2003 to December 18, 2005
|
|||
Desmond
A. Bell
|
Senior
Vice President, Shared Services and Chief Procurement
Officer
|
October
1, 2008 to present
|
||
Vice
President, Shared Services and Chief Procurement Officer
|
March
1, 2008 to September 30, 2008
|
|||
Vice
President and Chief of Staff
|
March
19, 2007 to February 29, 2008
|
|||
Vice
President, Parts Logistics, Bombardier Aerospace
|
April
2003 to September 2006
|
|||
Thomas
E. Bottorff
|
Senior
Vice President, Regulatory Relations
|
October 14,
2005 to present
|
||
Senior
Vice President, Customer Service and Revenue
|
March 1,
2004 to October 13, 2005
|
|||
Vice
President, Customer Service
|
June 1,
1999 to February 29, 2004
|
|||
Helen
A. Burt
|
Senior
Vice President and Chief Customer Officer
|
February
27, 2006 to present
|
||
Management
Consultant, The Burt Group
|
January
2003 to February 2006
|
|||
John
T. Conway
|
Senior
Vice President, Generation and Chief Nuclear Officer
|
October
1 , 2008 to present
|
||
Senior
Vice President and Chief Nuclear Officer
|
March
1, 2008 to September 30, 2008
|
|||
Site
Vice President, Diablo Canyon Power Plant
|
May
20, 2007 to February 29, 2008
|
|||
Site
Vice President, Monticello Nuclear Plant, Nuclear Management
Company
|
May
2005 to June 1, 2007
|
|||
Site
Director, Monticello Nuclear Plant, Nuclear Management
Company
|
April
2004 to May 2005
|
|||
Vice
President, Nine Mile Point, Constellation Energy Group
|
November
2001 to August 2003
|
|||
Christopher
P. Johns
|
Senior
Vice President and Treasurer
|
June
1, 2007 to present
|
||
Senior
Vice President, Chief Financial Officer, and Treasurer, PG&E
Corporation
|
October 4,
2005 to present
|
|||
Senior
Vice President, Chief Financial Officer, and Treasurer
|
October 1,
2005 to May 31, 2007
|
|||
Senior
Vice President, Chief Financial Officer, and Controller, PG&E
Corporation
|
January 1,
2005 to October 3, 2005
|
|||
Senior
Vice President and Controller, PG&E Corporation
|
September 19,
2001 to December 31, 2004
|
|||
Patricia
M. Lawicki
|
Senior
Vice President and Chief Information Officer
|
November
1, 2007 to present
|
||
Vice
President and Chief Information Officer
|
January
12, 2005 to October 31, 2007
|
|||
Vice
President, Chief Information Officer, NiSource, Inc.
|
April
23, 2003 to January 7, 2005
|
|||
Nancy
E. McFadden
|
Senior
Vice President, Public Affairs
|
June
20, 2007 to present
|
||
Senior
Vice President, Public Affairs, PG&E Corporation
|
March
1, 2007 to present
|
|||
Vice
President, Governmental Relations
|
September
26, 2005 to February 28, 2007
|
|||
Chairperson,
California Medical Assistance Commission
|
November
13, 2003 to November 30, 2005
|
|||
Hyun
Park
|
Senior
Vice President and General Counsel, PG&E Corporation
|
November 13,
2006 to present
|
||
Vice
President, General Counsel, and Secretary, Allegheny Energy,
Inc.
|
April 5,
2005 to October 17, 2006
|
|||
Senior
Vice President, General Counsel, and Secretary, Sithe Energies,
Inc.
|
March
2000 to February 2005
|
|||
Greg
S. Pruett
|
Senior
Vice President, Corporate Relations, PG&E Corporation
|
November
1, 2007 to present
|
||
Vice
President, Corporate Relations, PG&E Corporation
|
March
1, 2007 to October 31, 2007
|
|||
Vice
President, Communications and Marketing, American Gas
Association
|
April
10, 2006 to February 23, 2007
|
|||
Chief
Public Affairs Officer, Bechtel National, Inc.
|
June
12, 2004 to September 12, 2005
|
|||
Vice
President, Corporate Communications, PG&E Corporation
|
January
1, 1998 to September 12, 2003
|
|||
Edward
A. Salas
|
Senior
Vice President, Engineering and Operations
|
April
11, 2007 to present
|
||
Staff
Vice President, Network Planning, Verizon Wireless
|
May
2004 to April 2007
|
|||
Contractor,
Verizon Wireless, Local Number Portability Implementation
|
May
2003 to April 2004
|
|||
John
R. Simon
|
Senior
Vice President, Human Resources
|
April
16, 2007 to present
|
||
Senior
Vice President, Human Resources, PG&E Corporation
|
April
16, 2007 to present
|
|||
Executive
Vice President, Global Human Capital, TeleTech
|
March
21, 2006 to April 13, 2007
|
|||
Senior
Vice President, Human Capital, TeleTech Holdings, Inc.
|
July
13, 2001 to March 20, 2006
|
|||
Fong
Wan
|
Senior
Vice President, Energy Procurement
|
October
1, 2008 to present
|
||
Vice
President, Energy Procurement
|
January 9,
2006 to September 30, 2008
|
|||
Vice
President, Power Contracts and Electric Resource
Development
|
May 1,
2004 to January 8, 2006
|
|||
Vice
President, Risk Initiatives, PG&E Corporation Support Services,
Inc.
|
November
1, 2000 to April 30, 2004
|
|||
Geisha
J. Williams
|
Senior
Vice President, Energy Delivery
|
December
1, 2007 to present
|
||
Vice
President, Power Systems, Distribution, Florida Power and Light
Company
|
July
2003 to July 2007
|
|||
Barbara
L. Barcon
|
Vice
President, Finance and Chief Financial Officer
|
March
24, 2008 to present
|
||
Senior
Vice President, The Gores Group - Glendon Partners Private Equity
Firm
|
2007
to 2008
|
|||
Vice
President, Financial Process Excellence, Northrop Grumman
Corporation
|
2004
to 2007
|
|||
Vice
President, Planning and Analysis, Northrop Grumman
Corporation
|
2003
to 2004
|
Period
|
Total
Number of Shares Purchased
|
Average
Price Paid Per Share
|
Total
Number of Shares Purchased as Part of Publicly Announced Plans or
Programs
|
Approximate
Dollar Value of Shares that May Yet be Purchased Under the Plans or
Programs
|
|||||||
October
1 through October 31, 2008
|
-
|
$
|
-
|
$
|
-
|
||||||
November
1 through November 30, 2008
|
-
|
$
|
-
|
$
|
-
|
||||||
December
1 through December 31, 2008
|
3,872
|
(1)
|
$
|
$38.71
|
-
|
$
|
-
|
||||
Total
|
3,872
|
$
|
$38.71
|
-
|
$
|
-
|
|||||
(1)
Shares tendered to satisfy tax withholding obligations arising upon the
vesting of PG&E Corporation restricted
stock.
|
Plan
Category
|
(a)
Number
of Securities to
be
Issued Upon Exercise
of
Outstanding Options,
Warrants
and Rights
|
(b)
Weighted
Average
Exercise
Price of
Outstanding
Options,
Warrants
and Rights
|
(c)
Number
of Securities
Remaining
Available for
Future
Issuance Under
Equity
Compensation Plans
(Excluding
Securities
Reflected
in Column(a))
|
|||
Equity
compensation plans approved by shareholders
|
3,062,874
(1)
|
$23.45
|
10,342,381
(2)
|
|||
Equity
compensation plans not approved by
shareholders
|
—
|
—
|
—
|
|||
Total
equity compensation plans
|
3,062,874
(1)
|
$23.45
|
10,342,381
(2)
|
|
(1) Includes
94,613 phantom stock units and restricted stock units. The
weighted average exercise price reported in column (b) does not take these
awards into account.
|
|
(2) Represents
the total number of shares available for issuance under the PG&E
Corporation's Long-Term Incentive Program (“LTIP”) and the PG&E
Corporation 2006 Long-Term Incentive Plan (“2006 LTIP”) as of
December 31, 2008. Outstanding stock-based awards granted
under the LTIP include stock options, restricted stock and phantom
stock. The LTIP expired on December 31, 2005. The
2006 LTIP, which became effective on January 1, 2006, authorizes up to 12
million shares to be issued pursuant to awards granted under the 2006
LTIP. Outstanding stock-based awards granted under the 2006
LTIP include stock options, restricted stock, restricted stock units, and
phantom stock. For a description of the LTIP and the 2006 LTIP,
see Note 14 of the Notes to the Consolidated Financial Statements in
the 2008 Annual Report.
|
Exhibit
Number
|
Exhibit
Description
|
|
2.1
|
Order
of the U.S. Bankruptcy Court for the Northern District of California dated
December 22, 2003, Confirming Plan of Reorganization of Pacific Gas
and Electric Company, including Plan of Reorganization, dated July 31,
2003 as modified by modifications dated November 6, 2003 and December 19,
2003 (Exhibit B to Confirmation Order and Exhibits B and C to the Plan of
Reorganization omitted) (incorporated by reference to Pacific Gas and
Electric Company's Registration Statement on Form S-3 No. 333-109994,
Exhibit 2.1)
|
|
2.2
|
Order
of the U.S. Bankruptcy Court for the Northern District of California dated
February 27, 2004 Approving Technical Corrections to Plan of
Reorganization of Pacific Gas and Electric Company and Supplementing
Confirmation Order to Incorporate such Corrections (incorporated by
reference to Pacific Gas and Electric Company's Registration Statement on
Form S-3 No. 333-109994, Exhibit 2.2)
|
|
3.1
|
Restated
Articles of Incorporation of PG&E Corporation effective as of May 29,
2002 (incorporated by reference to PG&E Corporation's Quarterly Report
on Form 10-Q for the quarter ended March 31, 2003 (File No. 1-12609),
Exhibit 3.1)
|
|
3.2
|
Certificate
of Determination for PG&E Corporation Series A Preferred Stock filed
December 22, 2000 (incorporated by reference to PG&E Corporation's
Form 10-K for the year ended December 31, 2000 (File No. 1-12609), Exhibit
3.2)
|
|
3.3
|
Bylaws
of PG&E Corporation amended as of January 1, 2009
|
|
3.4
|
Restated
Articles of Incorporation of Pacific Gas and Electric Company effective as
of April 12, 2004 (incorporated by reference to Pacific Gas and
Electric Company's Form 8-K filed April 12, 2004 (File
No. 1-2348), Exhibit 3)
|
|
3.5
|
Bylaws
of Pacific Gas and Electric Company amended as of January 1,
2009
|
|
4.1
|
Indenture,
dated as of April 22, 2005, supplementing, amending and restating the
Indenture of Mortgage, dated as of March 11, 2004, as supplemented by a
First Supplemental Indenture, dated as of March 23, 2004, and a Second
Supplemental Indenture, dated as of April 12, 2004, between Pacific Gas
and Electric Company and The Bank of New York Trust Company, N.A.
(incorporated by reference to PG&E Corporation and Pacific Gas and
Electric Company's Form 10-Q filed May 4, 2005 (File No. 1-12609 and File
No. 1-2348), Exhibit 4.1)
|
|
4.2
|
First
Supplemental Indenture dated as of March 13, 2007 relating to the issuance
of $700,000,000 principal amount of 5.80% Senior Notes due March 1, 2037
(incorporated by reference from Pacific Gas and Electric Company’s Current
Report on Form 8-K dated March 14, 2007 (File No. 1-2348), Exhibit
4.1)
|
|
4.3
|
Second
Supplemental Indenture dated as of December 4, 2007 relating to the
issuance of $500,000,000 principal amount of 5.625% Senior Notes due
November 30, 2017(incorporated by reference from Pacific Gas and
Electric Company’s Current Report on Form 8-K dated March 14, 2007 (file
No. 1-2348), Exhibit 4.1)
|
|
4.4
|
Third
Supplemental Indenture dated as of March 3, 2008 relating to the issuance
of 5.625% Senior Notes due November 30, 2017 and 6.35% Senior Notes due
February 15, 2038 (incorporated by reference to Pacific Gas and Electric
Company’s Current Report on Form 8-K dated March 3, 2008 (File No.
1-2348), Exhibit 4.1)
|
|
4.5
|
Fourth
Supplemental Indenture dated as of October 21, 2008 relating to the
Utility’s issuance of $600,000,000 aggregate principal amount of its 8.25%
Senior Notes due October 15, 2018 (incorporated by reference to Pacific
Gas and Electric Company’s Current Report on Form 8-K dated October 21,
2008 (File No. 1-2348), Exhibit 4.1)
|
|
4.6
|
Indenture
related to PG&E Corporation's 7.5% Convertible Subordinated Notes due
June 2007, dated as of June 25, 2002, between PG&E Corporation
and U.S. Bank, N.A., as Trustee (incorporated by reference to PG&E
Corporation's Form 8-K filed June 26, 2002 (File No. 1-12609),
Exhibit 99.1).
|
|
4.7
|
Supplemental
Indenture related to PG&E Corporation's 9.50% Convertible Subordinated
Notes due June 2010, dated as of October 18, 2002, between PG&E
Corporation and U.S. Bank, N.A., as Trustee (incorporated by reference to
PG&E Corporation's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2002 (File No. 1-12609),
Exhibit 4.1)
|
|
10.1
|
Amended
and Restated Unsecured Revolving Credit Agreement entered into among
Pacific Gas and Electric Company, Citicorp North America, Inc., as
administrative agent and a lender, JPMorgan Securities Inc., as
syndication agent, Barclays Bank Plc and BNP Paribas, as documentation
agents and lenders, Deutsche Bank Securities Inc., as documentation agent,
and other lenders, dated February 26, 2007 (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 10-Q for
the quarter ended March 31, 2007 (File No. 1-12609 and File
No. 1-2348), Exhibit 10.2)
|
|
10.2
|
Amended
and Restated Unsecured Revolving Credit Agreement entered into among
PG&E Corporation, BNP Paribas, as administrative agent and a lender,
Deutsche Bank Securities Inc., as syndication agent, ABN AMRO Bank, N.V.,
Bank of America, N.A., and Barclays Bank Plc, as documentation agents and
lenders, and other lenders, dated February 26, 2007 (incorporated by
reference to PG&E Corporation and Pacific Gas and Electric Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 (File
No. 1-12609 and File No. 1-2348),
Exhibit 10.2)
|
|
10.3
|
Settlement
Agreement among California Public Utilities Commission, Pacific Gas and
Electric Company and PG&E Corporation, dated as of December 19, 2003,
together with appendices (incorporated by reference to PG&E
Corporation's and Pacific Gas and Electric Company's Form 8-K filed
December 22, 2003) (File No. 1-12609 and File No. 1-2348), Exhibit
99)
|
|
10.4
|
Transmission
Control Agreement among the California Independent System Operator (CAISO)
and the Participating Transmission Owners, including Pacific Gas and
Electric Company, effective as of March 31, 1998, as amended (CAISO,
FERC Electric Tariff No. 7) (incorporated by reference to PG&E
Corporation’s and Pacific Gas and Electric Company’s Form 10-K for the
year ended December 31, 2004 (File No. 1-12609 and File No. 1-2348),
Exhibit 10.8)
|
|
10.5
|
Operating
Agreement, as amended on November 12, 2004, effective as of December 22,
2004, between the State of California Department of Water Resources and
Pacific Gas and Electric Company (incorporated by reference to PG&E
Corporation’s and Pacific Gas and Electric Company’s Form 10-K for the
year ended December 31, 2004 (File No. 1-12609 and File No. 1-2348),
Exhibit 10.9)
|
|
*10.6
|
PG&E
Corporation Supplemental Retirement Savings Plan amended effective as of
September 19, 2001, and frozen after December 31, 2004 (incorporated by
reference to PG&E Corporation’s Form 10-K for the year ended December
31, 2004) (File No. 1-12609), Exhibit 10.10)
|
|
*10.7
|
PG&E
Corporation 2005 Supplemental Retirement Savings Plan effective as of
January 1, 2005 (as amended to comply with Internal Revenue Code Section
409A regulations effective as of January 1, 2009)
|
|
*10.8
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Peter
A. Darbee effective July 1, 2003 (incorporated by reference to PG&E
Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30,
2003 (File No. 1-12609), Exhibit 10.4)
|
|
*10.9
|
Restricted
Stock Award Agreement between PG&E Corporation and Peter A. Darbee
dated January 3, 2007 (incorporated by reference to PG&E Corporation's
and Pacific Gas and Electric Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 2007 (File No. 1-12609 and File
No. 12348), Exhibit 10.3)
|
|
*10.10
|
Amendment
to January 3, 2007 Restricted Stock Agreement between PG&E Corporation
and Peter A. Darbee, effective May 9, 2008 (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended June 30, 2008 (File
No. 1-12609), Exhibit 10.1)
|
|
*10.11
|
Amended
and Restated Restricted Stock Unit Agreement between Peter A. Darbee and
PG&E Corporation (as amended to comply with Internal Revenue Code
Section 409A regulations effective as of January 1,
2009)
|
|
*10.12
|
Restricted
Stock Unit Agreement between Peter A. Darbee and PG&E Corporation
dated January 2, 2009
|
|
*10.13
|
Letter
regarding Compensation Arrangement between Pacific Gas and Electric
Company and William T. Morrow dated June 20, 2006 (incorporated by
reference to PG&E Corporation's Quarterly Report on Form 10-Q for the
quarter ended September 30, 2006 (File No. 1-12609), Exhibit
10.1)
|
|
*10.14
|
Restricted
Stock Award Agreement between PG&E Corporation and William T. Morrow
dated January 29, 2007 (incorporated by reference to PG&E
Corporation's Quarterly Report on Form 10-Q for the quarter ended March
31, 2007 (File No. 1-12609), Exhibit 10.4)
|
|
*10.15
|
Performance
Share Agreement between PG&E Corporation and William T. Morrow dated
November 6, 2007 (incorporated by reference to PG&E Corporation’s Form
10-K for the year ended December 31, 2007) (File No. 1-12609), Exhibit
10.13)
|
|
*10.16
|
Restricted
Stock Award Agreement between PG&E Corporation and William T. Morrow
dated November 6, 2007 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2007) (File No.
1-12609), Exhibit 10.14)
|
|
*10.17
|
Separation
Agreement between William T. Morrow and Pacific Gas and Electric Company
dated July 8, 2008 (incorporated by reference to PG&E Corporation's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 2008 (File No. 1-12609), Exhibit
10)
|
|
*10.18
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Rand
L. Rosenberg dated October 19, 2005 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2005) (File No.
1-12609), Exhibit 10.18)
|
|
*10.19
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Hyun
Park dated October 10, 2006 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2006) (File No.
1-12609), Exhibit 10.18)
|
|
*10.20
|
Letter
regarding Compensation Agreement between PG&E Corporation and G.
Robert Powell dated August 8, 2005 (incorporated by reference
to PG&E Corporation’s Form 10-K for the year ended December 31, 2007)
(File No. 1-12609), Exhibit 10.17)
|
|
*10.21
|
Letter
regarding Compensation Agreement between Pacific Gas and Electric Company
and John S. Keenan dated November 21, 2005
|
|
*10.22
|
Letter
regarding Compensation Agreement between Pacific Gas and Electric Company
and Barbara Barcon dated March 3, 2008 (incorporated by reference to
PG&E Corporation's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2008 (File No. 1-12609), Exhibit 10.3)
|
|
*10.23
|
Separation
Agreement between PG&E Corporation and G. Robert Powell dated March 6,
2008 (incorporated by reference to PG&E Corporation's Quarterly Report
on Form 10-Q for the quarter ended March 31, 2008 (File No. 1-12609),
Exhibit 10.4)
|
|
*10.24
|
PG&E
Corporation 2005 Deferred Compensation Plan for Non-Employee Directors,
effective as of January 1, 2005 (as amended to comply with Internal
Revenue Code Section 409A regulations effective as of January 1,
2009)
|
|
*10.25
|
Description
of Short-Term Incentive Plan for Officers of PG&E Corporation and its
subsidiaries, effective January 1, 2008 (incorporated by reference to
PG&E Corporation's Form 10-K for the year ended December 31, 2007
(File No. 1-12609), Exhibit 10.19)
|
|
*10.26
|
Description
of Short-Term Incentive Plan for Officers of PG&E Corporation and its
subsidiaries, effective January 1, 2009
|
|
*10.27
|
Amendment
to PG&E Corporation Short-Term Incentive Programs and Other Bonus
Programs, effective January 1, 2009 (amendment to comply with Internal
Revenue Code Section 409A regulations)
|
|
*10.28
|
Amendment
to Pacific Gas and Electric Company Short-Term Incentive Programs and
Other Bonus Programs, effective January 1, 2009 (amendment to comply with
Internal Revenue Code Section 409A regulations)
|
|
*10.29
|
Supplemental
Executive Retirement Plan of PG&E Corporation as amended effective as
of January 1, 2009 (amended to comply with Internal Revenue Code Section
409A Regulations)
|
|
*10.30
|
Pacific
Gas and Electric Company Relocation Assistance Program for
Officers
|
|
*10.31
|
Postretirement
Life Insurance Plan of the Pacific Gas and Electric Company (incorporated
by reference to Pacific Gas and Electric Company's Form 10-K for fiscal
year 1991 (File No. 1-2348), Exhibit 10.16)
|
|
*10.32
|
Amendment
to Postretirement Life Insurance Plan of the Pacific Gas and Electric
Company dated December 30, 2008 (amendment to comply with Internal Revenue
Code Section 409A regulations)
|
|
*10.33
|
PG&E
Corporation Non-Employee Director Stock Incentive Plan (a component of the
PG&E Corporation Long-Term Incentive Program) as amended effective as
of July 1, 2004 (reflecting amendments adopted by the PG&E Corporation
Board of Directors on June 16, 2004 set forth in resolutions filed as
Exhibit 10.3 to PG&E Corporation's and Pacific Gas and Electric
Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
2004
)
(incorporated by reference to PG&E Corporation’s and Pacific
Gas and Electric Company’s Form 10-K for the year ended December 31, 2004
(File No. 1-12609 and File No. 1-2348), Exhibit 10.27)
|
|
*10.34
|
Resolution
of the PG&E Corporation Board of Directors dated February 20, 2008,
adopting director compensation arrangement effective January 1,
2008 (incorporated by reference to PG&E Corporation's and Pacific
Gas and Electric Company's Quarterly Report on Form 10-K for the year
ended December 31, 2007 (File No. 1-12609 and File No. 12348),
Exhibit 10.28)
|
|
*10.35
|
Resolution
of the Pacific Gas and Electric Company Board of Directors dated February
20, 2008, adopting director compensation arrangement effective January 1,
2008 (incorporated by reference to PG&E Corporation's and Pacific
Gas and Electric Company's Quarterly Report on Form 10-K for the year
ended December 31, 2007 (File No. 1-12609 and File No. 12348),
Exhibit 10.29)
|
|
*10.36
|
Resolution
of the PG&E Corporation Board of Directors dated September 17, 2008,
adopting director compensation arrangement effective January 1,
2009
|
|
*10.37
|
Resolution
of the Pacific Gas and Electric Company Board of Directors dated September
17, 2008, adopting director compensation arrangement effective January 1,
2009
|
|
*10.38
|
PG&E
Corporation 2006 Long-Term Incentive Plan, as amended through February 18,
2009
|
|
*10.39
|
PG&E
Corporation Long-Term Incentive Program (including the PG&E
Corporation Stock Option Plan and Performance Unit Plan), as amended May
16, 2001, (incorporated by reference to PG&E Corporation's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2001 (File
No. 1-12609), Exhibit 10)
|
|
*10.40
|
Form
of Restricted Stock Award Agreement for 2004 grants made under the
PG&E Corporation Long-Term Incentive Program (incorporated by
reference to PG&E Corporation's Form 10-K for the year ended December
31, 2003 (File No. 1-12609), Exhibit 10.37)
|
|
*10.41
|
Form
of Restricted Stock Agreement for 2005 grants under the PG&E
Corporation Long-Term Incentive Program (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.3)
|
|
*10.42
|
Form
of Restricted Stock Agreement for 2006 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 9, 2006, Exhibit 99.1)
|
|
*10.43
|
Form
of Restricted Stock Agreement for 2007 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (reflecting amendments to the
PG&E Corporation 2006 Long-Term Incentive Plan made on February 15,
2006) (incorporated by reference to PG&E Corporation's Form 10-K for
the year ended December 31, 2006 (File No. 1-12609),
Exhibit 10.39)
|
|
*10.44
|
Form
of Restricted Stock Agreement for 2008 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended March 31, 2008
(File No. 1-12609), Exhibit 10.5)
|
|
*10.45
|
Form
of Amendment to Restricted Stock Agreements for grants made between
January 2005 and March 2008 (amendments to comply with Internal Revenue
Code Section 409A Regulations)
|
|
*10.46
|
Form
of Non-Qualified Stock Option Agreement under the PG&E Corporation
Long-Term Incentive Program (incorporated by reference to PG&E
Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.1)
|
|
*10.47
|
Form
of Performance Share Agreement for 2005 grants under the PG&E
Corporation Long-Term Incentive Program (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.2)
|
|
*10.48
|
Form
of Performance Share Agreement for 2006 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 9, 2006, Exhibit 99.2)
|
|
*10.49
|
Form
of Performance Share Agreement for 2007 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (reflecting amendments to the
PG&E Corporation 2006 Long-Term Incentive Plan made on February 15,
2006) (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2006 (File No. 1-12609),
Exhibit 10.44)
|
|
*10.50
|
Form
of Performance Share Agreement for 2008 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended March 31, 2008
(File No. 1-12609), Exhibit 10.6)
|
|
*10.51
|
|
Form
of Amended and Restated Performance Share Agreement for 2006 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
*10.52
|
Form
of Amended and Restated Performance Share Agreement for 2007 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.53
|
Form
of Amended and Restated Performance Share Agreement for 2008 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.54
|
PG&E
Corporation Executive Stock Ownership Program Guidelines as amended
effective February 17, 2009
|
|
*10.55
|
PG&E
Corporation Officer Severance Policy, as amended effective as of February
15, 2006 (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2005 (File No. 1-12609),
Exhibit 10.48)
|
|
*10.56
|
PG&E
Corporation Officer Severance Policy, as amended effective as of January
1, 2009 (amended to comply with Internal Revenue Code Section 409A
regulations)
|
|
*10.57
|
PG&E
Corporation Golden Parachute Restriction Policy effective as of February
15, 2006 (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2005 (File No. 1-12609),
Exhibit 10.49)
|
|
*10.58
|
Amendment
to PG&E Corporation Golden Parachute Restriction Policy dated December
31, 2008 (amendment to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.59
|
PG&E
Corporation Director Grantor Trust Agreement dated April 1, 1998
(incorporated by reference to PG&E Corporation's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1998 (File No. 1-12609),
Exhibit 10.1)
|
|
*10.60
|
PG&E
Corporation Officer Grantor Trust Agreement dated April 1, 1998, as
updated effective January 1, 2005 (incorporated by reference to PG&E
Corporation's Form 10-K for the year ended December 31, 2004 (File
No. 1-12609), Exhibit 10.39)
|
|
*10.61
|
Resolution
of the Board of Directors of PG&E Corporation regarding
indemnification of officers and directors dated December 18, 1996
(incorporated by reference to PG&E Corporation's Form 10-K for the
year ended December 31, 2004 (File No. 1-12609),
Exhibit 10.40)
|
|
*10.62
|
Resolution
of the Board of Directors of Pacific Gas and Electric Company regarding
indemnification of officers and directors dated July 19, 1995
(incorporated by reference to Pacific Gas and Electric Company’s Form 10-K
for the year ended December 31, 2004 (File No. 1-2348),
Exhibit 10.41)
|
|
11
|
Computation
of Earnings Per Common Share
|
|
12.1
|
Computation
of Ratios of Earnings to Fixed Charges for Pacific Gas and Electric
Company
|
|
12.2
|
Computation
of Ratios of Earnings to Combined Fixed Charges and Preferred Stock
Dividends for Pacific Gas and Electric Company
|
|
13
|
The
following portions of the 2008 Annual Report to Shareholders of PG&E
Corporation and Pacific Gas and Electric Company are included: “Selected
Financial Data,” “Management's Discussion and Analysis of Financial
Condition and Results of Operations,” financial statements of PG&E
Corporation entitled “Consolidated Statements of Income,” “Consolidated
Balance Sheets,” “Consolidated Statements of Cash Flows,” and
“Consolidated Statements of Shareholders' Equity,” financial statements of
Pacific Gas and Electric Company entitled “Consolidated Statements of
Income,” “Consolidated Balance Sheets,” “Consolidated Statements of Cash
Flows,” and “Consolidated Statements of Shareholders' Equity,” “Notes to
the Consolidated Financial Statements,” “Quarterly Consolidated Financial
Data (Unaudited),” “Management's Report on Internal Control Over Financial
Reporting,” and “Report of Independent Registered Public Accounting
Firm.”
|
|
21
|
Subsidiaries
of the Registrant
|
|
23
|
Consent
of Independent Registered Public Accounting Firm (Deloitte & Touche
LLP)
|
|
24.1
|
Resolutions
of the Boards of Directors of PG&E Corporation and Pacific Gas and
Electric Company authorizing the execution of the Form
10-K
|
|
24.2
|
Powers
of Attorney
|
|
31.1
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of PG&E
Corporation required by Section 302 of the Sarbanes-Oxley Act of
2002
|
|
31.2
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of Pacific
Gas and Electric Company required by Section 302 of the Sarbanes-Oxley Act
of 2002
|
|
**32.1
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of PG&E
Corporation required by Section 906 of the Sarbanes-Oxley Act of
2002
|
|
**32.2
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of Pacific
Gas and Electric Company required by Section 906 of the Sarbanes-Oxley Act
of 2002
|
PG&E
CORPORATION
|
PACIFIC
GAS AND ELECTRIC COMPANY
|
||
(Registrant)
*PETER
A. DARBEE
|
(Registrant)
*PETER
A. DARBEE
|
||
By:
|
Peter
A. Darbee
Chairman
of the Board, Chief Executive Officer,
and
President
|
By:
|
Peter
A. Darbee
President
and Chief Executive Officer
|
Date:
|
February
24, 2009
|
Date:
|
February
24, 2009
|
REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
|
Year
Ended December 31,
|
|||
2008
|
2007
|
2006
|
|
Administrative
service revenue
|
119
|
102
|
110
|
Equity
in earnings of subsidiaries
|
1,182
|
1,006
|
964
|
Operating
expenses
|
(105)
|
(112)
|
(115)
|
Interest
income
|
4
|
15
|
15
|
Interest
expense
|
(30)
|
(31)
|
(30)
|
Other
income (expense)
|
(46)
|
(6)
|
(1)
|
Income
before income taxes
|
1,124
|
974
|
943
|
Income
tax benefit
|
60
|
32
|
48
|
Income
from continuing operations
|
1,184
|
1,006
|
991
|
Gain
on disposal of NEGT
|
154
|
-
|
-
|
Net
income before intercompany eliminations
|
1,338
|
1,006
|
991
|
Weighted
average common shares outstanding, basic
|
357
|
351
|
346
|
Weighted
average common shares outstanding, diluted
|
358
|
353
|
349
|
Earnings
per common share, basic
(1)
|
$3.64
|
$2.79
|
$2.78
|
Earnings
per common share, diluted
(1)
|
$3.63
|
$2.78
|
$2.76
|
Balance at
December 31,
|
||
2008
|
2007
|
|
ASSETS
|
||
Current
Assets
:
|
||
Cash
and cash equivalents
|
$
167
|
$
204
|
Advances
to affiliates
|
28
|
30
|
Income
taxes receivable
|
148
|
46
|
Other
current assets
|
14
|
3
|
Total
current assets
|
357
|
283
|
Equipment
|
17
|
17
|
Accumulated
depreciation
|
(15)
|
(15)
|
Net
equipment
|
2
|
2
|
Investments
in subsidiaries
|
9,539
|
8,886
|
Other
investments
|
68
|
87
|
Deferred
income taxes
|
51
|
51
|
Other
|
4
|
9
|
Total
Assets
|
$
10,021
|
$
9,318
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||
Current
Liabilities:
|
||
Accounts
payable—related parties
|
$
34
|
$
40
|
Accounts
payable—other
|
18
|
24
|
Other
|
189
|
174
|
Total
current liabilities
|
241
|
238
|
Noncurrent
Liabilities:
|
||
Long-term
debt
|
280
|
280
|
Income
taxes payable
|
23
|
131
|
Other
|
100
|
116
|
Total
noncurrent liabilities
|
403
|
527
|
Common
Shareholders' Equity
|
||
Common
stock
|
5,984
|
6,110
|
Common
stock held by subsidiary
|
-
|
(718)
|
Reinvested
earnings
|
3,614
|
3,151
|
Accumulated
other comprehensive income
|
(221)
|
10
|
Total
common shareholders' equity
|
9,377
|
8,553
|
Total
Liabilities and Shareholders' Equity
|
$
10,021
|
$
9,318
|
Year
Ended December 31,
|
||||||||||
2008
|
2007
|
2006
|
||||||||
Cash
Flows from Operating Activities:
|
||||||||||
Net
income
|
$
|
1,338
|
$
|
1,006
|
$
|
991
|
||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||
Depreciation
and amortization
|
3
|
1
|
-
|
|||||||
Equity
in earnings of subsidiaries
|
(1,180)
|
(1,006)
|
(964)
|
|||||||
Noncurrent
income taxes receivable/payable
|
(108)
|
4
|
-
|
|||||||
Other
|
(81)
)
|
(19)
)
|
132
|
|||||||
Net
cash used in operating activities
|
(28)
|
24
|
159
|
|||||||
Cash
Flows From Investing Activities:
|
||||||||||
Capital
expenditures
|
-
|
(1)
|
(1)
|
|||||||
Investment
in subsidiaries
|
(275)
|
(405)
|
-
|
|||||||
Dividends
received from subsidiaries
|
596
|
509
|
460
|
|||||||
Other
|
(12)
|
-
|
-
|
|||||||
Net
cash provided by investing activities
|
309
|
103
|
459
|
|||||||
Cash
Flows From Financing Activities
(1)
:
|
||||||||||
Common
stock issued
|
225
|
175
|
131
|
|||||||
Common
stock repurchased
|
-
|
-
|
(114)
|
|||||||
Common
stock dividends paid
|
(546)
|
(496)
|
(456)
|
|||||||
Other
|
2
|
12
|
(43)
|
|||||||
Net
cash used in financing activities
|
(319)
|
(309)
|
(482)
|
|||||||
Net
change in cash and cash equivalents
|
(38)
|
(182)
|
136
|
|||||||
Cash
and cash equivalents at January 1
|
204
|
386
|
250
|
|||||||
Cash
and cash equivalents at December 31
|
$
|
166
|
$
|
204
|
$
|
386
|
||||
(1)
On January 15, 2008, PG&E Corporation paid a quarterly common
stock dividend of $0.36 per share. On April 15, July 15, and
October 15, 2008, PG&E Corporation paid quarterly common stock
dividends of $0.39 per share. Of the total dividend payments
made by PG&E Corporation in 2008, approximately $28 million was paid
to Elm Power Corporation, a wholly owned subsidiary of PG&E
Corporation.
On
January 15, 2007, PG&E Corporation paid a quarterly common stock
dividend of $0.33 per share. On April 15, July 15, and October
15, 2007, PG&E Corporation paid quarterly common stock dividends of
$0.36 per share. Of the total dividend payments made by
PG&E Corporation in 2007, approximately $35 million was paid to Elm
Power Corporation, a wholly owned subsidiary of PG&E
Corporation.
On
January 16, April 15, July 15, and October 15, 2006, PG&E Corporation
paid a quarterly common stock dividend of $0.33 per share, totaling
approximately $489 million. Of the total dividend payments made
by PG&E Corporation in 2006, approximately $33 million was paid to Elm
Power Corporation, a wholly owned subsidiary of PG&E
Corporation.
|
Additions
|
|||||
Description
|
Balance
at Beginning of Period
|
Charged
to Costs and Expenses
|
Charged
to Other Accounts
|
Deductions
(3)
|
Balance
at End of Period
|
(in
millions)
|
|||||
Valuation
and qualifying accounts deducted from assets:
|
|||||
2008:
|
|||||
Allowance
for uncollectible accounts
(1)(2)
|
$
58
|
$
68
|
$
11
|
$
61
|
$
76
|
2007:
|
|||||
Allowance
for uncollectible accounts
(1)(2)
|
$
50
|
$
20
|
$
-
|
$
12
|
$
58
|
2006:
|
|||||
Allowance
for uncollectible accounts
(1)(2)
|
$
77
|
$
2
|
$
-
|
$
29
|
$
50
|
(1)
Allowance for uncollectible accounts is deducted from “Accounts receivable
Customers, net.”
|
|||||
(2)
Allowance for uncollectible accounts does not include
NEGT.
|
|||||
(3)
Deductions consist principally of write-offs, net of collections of
receivables previously written
off.
|
Additions
|
|||||
Description
|
Balance
at Beginning of Period
|
Charged
to Costs and Expenses
|
Charged
to Other Accounts
|
Deductions
(2)
|
Balance
at End of Period
|
(in
millions)
|
|||||
Valuation
and qualifying accounts deducted from assets:
|
|||||
2008:
|
|||||
Allowance
for uncollectible accounts
(1)
|
$
58
|
$
68
|
$
11
|
$
61
|
$
76
|
2007:
|
|||||
Allowance
for uncollectible accounts
(1)
|
$
50
|
$
20
|
$
-
|
$
12
|
$
58
|
2006:
|
|||||
Allowance
for uncollectible accounts
(1)
|
$
77
|
$
2
|
$
-
|
$
29
|
$
50
|
(1)
Allowance for uncollectible accounts is deducted from “Accounts receivable
Customers, net.”
|
|||||
(2)
Deductions consist principally of write-offs, net of collections of
receivables previously written off.
|
Exhibit
Number
|
Exhibit
Description
|
|
2.1
|
Order
of the U.S. Bankruptcy Court for the Northern District of California dated
December 22, 2003, Confirming Plan of Reorganization of Pacific Gas
and Electric Company, including Plan of Reorganization, dated July 31,
2003 as modified by modifications dated November 6, 2003 and December 19,
2003 (Exhibit B to Confirmation Order and Exhibits B and C to the Plan of
Reorganization omitted) (incorporated by reference to Pacific Gas and
Electric Company's Registration Statement on Form S-3 No. 333-109994,
Exhibit 2.1)
|
|
2.2
|
Order
of the U.S. Bankruptcy Court for the Northern District of California dated
February 27, 2004 Approving Technical Corrections to Plan of
Reorganization of Pacific Gas and Electric Company and Supplementing
Confirmation Order to Incorporate such Corrections (incorporated by
reference to Pacific Gas and Electric Company's Registration Statement on
Form S-3 No. 333-109994, Exhibit 2.2)
|
|
3.1
|
Restated
Articles of Incorporation of PG&E Corporation effective as of May 29,
2002 (incorporated by reference to PG&E Corporation's Quarterly Report
on Form 10-Q for the quarter ended March 31, 2003 (File No. 1-12609),
Exhibit 3.1)
|
|
3.2
|
Certificate
of Determination for PG&E Corporation Series A Preferred Stock filed
December 22, 2000 (incorporated by reference to PG&E Corporation's
Form 10-K for the year ended December 31, 2000 (File No. 1-12609), Exhibit
3.2)
|
|
3.3
|
Bylaws
of PG&E Corporation amended as of January 1, 2009
|
|
3.4
|
Restated
Articles of Incorporation of Pacific Gas and Electric Company effective as
of April 12, 2004 (incorporated by reference to Pacific Gas and
Electric Company's Form 8-K filed April 12, 2004 (File
No. 1-2348), Exhibit 3)
|
|
3.5
|
Bylaws
of Pacific Gas and Electric Company amended as of January 1,
2009
|
|
4.1
|
Indenture,
dated as of April 22, 2005, supplementing, amending and restating the
Indenture of Mortgage, dated as of March 11, 2004, as supplemented by a
First Supplemental Indenture, dated as of March 23, 2004, and a Second
Supplemental Indenture, dated as of April 12, 2004, between Pacific Gas
and Electric Company and The Bank of New York Trust Company, N.A.
(incorporated by reference to PG&E Corporation and Pacific Gas and
Electric Company's Form 10-Q filed May 4, 2005 (File No. 1-12609 and File
No. 1-2348), Exhibit 4.1)
|
|
4.2
|
First
Supplemental Indenture dated as of March 13, 2007 relating to the issuance
of $700,000,000 principal amount of 5.80% Senior Notes due March 1, 2037
(incorporated by reference from Pacific Gas and Electric Company’s Current
Report on Form 8-K dated March 14, 2007 (File No. 1-2348), Exhibit
4.1)
|
|
4.3
|
Second
Supplemental Indenture dated as of December 4, 2007 relating to the
issuance of $500,000,000 principal amount of 5.625% Senior Notes due
November 30, 2017(incorporated by reference from Pacific Gas and
Electric Company’s Current Report on Form 8-K dated March 14, 2007 (file
No. 1-2348), Exhibit 4.1)
|
|
4.4
|
Third
Supplemental Indenture dated as of March 3, 2008 relating to the issuance
of 5.625% Senior Notes due November 30, 2017 and 6.35% Senior Notes due
February 15, 2038 (incorporated by reference to Pacific Gas and Electric
Company’s Current Report on Form 8-K dated March 3, 2008 (File No.
1-2348), Exhibit 4.1)
|
|
4.5
|
Fourth
Supplemental Indenture dated as of October 21, 2008 relating to the
Utility’s issuance of $600,000,000 aggregate principal amount of its 8.25%
Senior Notes due October 15, 2018 (incorporated by reference to Pacific
Gas and Electric Company’s Current Report on Form 8-K dated October 21,
2008 (File No. 1-2348), Exhibit 4.1)
|
|
4.6
|
Indenture
related to PG&E Corporation's 7.5% Convertible Subordinated Notes due
June 2007, dated as of June 25, 2002, between PG&E Corporation
and U.S. Bank, N.A., as Trustee (incorporated by reference to PG&E
Corporation's Form 8-K filed June 26, 2002 (File No. 1-12609),
Exhibit 99.1).
|
|
4.7
|
Supplemental
Indenture related to PG&E Corporation's 9.50% Convertible Subordinated
Notes due June 2010, dated as of October 18, 2002, between PG&E
Corporation and U.S. Bank, N.A., as Trustee (incorporated by reference to
PG&E Corporation's Quarterly Report on Form 10-Q for the quarter ended
September 30, 2002 (File No. 1-12609),
Exhibit 4.1)
|
|
10.1
|
Amended
and Restated Unsecured Revolving Credit Agreement entered into among
Pacific Gas and Electric Company, Citicorp North America, Inc., as
administrative agent and a lender, JPMorgan Securities Inc., as
syndication agent, Barclays Bank Plc and BNP Paribas, as documentation
agents and lenders, Deutsche Bank Securities Inc., as documentation agent,
and other lenders, dated February 26, 2007 (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 10-Q for
the quarter ended March 31, 2007 (File No. 1-12609 and File
No. 1-2348), Exhibit 10.2)
|
|
10.2
|
Amended
and Restated Unsecured Revolving Credit Agreement entered into among
PG&E Corporation, BNP Paribas, as administrative agent and a lender,
Deutsche Bank Securities Inc., as syndication agent, ABN AMRO Bank, N.V.,
Bank of America, N.A., and Barclays Bank Plc, as documentation agents and
lenders, and other lenders, dated February 26, 2007 (incorporated by
reference to PG&E Corporation and Pacific Gas and Electric Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 (File
No. 1-12609 and File No. 1-2348),
Exhibit 10.2)
|
|
10.3
|
Settlement
Agreement among California Public Utilities Commission, Pacific Gas and
Electric Company and PG&E Corporation, dated as of December 19, 2003,
together with appendices (incorporated by reference to PG&E
Corporation's and Pacific Gas and Electric Company's Form 8-K filed
December 22, 2003) (File No. 1-12609 and File No. 1-2348), Exhibit
99)
|
|
10.4
|
Transmission
Control Agreement among the California Independent System Operator (CAISO)
and the Participating Transmission Owners, including Pacific Gas and
Electric Company, effective as of March 31, 1998, as amended (CAISO,
FERC Electric Tariff No. 7) (incorporated by reference to PG&E
Corporation’s and Pacific Gas and Electric Company’s Form 10-K for the
year ended December 31, 2004 (File No. 1-12609 and File No. 1-2348),
Exhibit 10.8)
|
|
10.5
|
Operating
Agreement, as amended on November 12, 2004, effective as of December 22,
2004, between the State of California Department of Water Resources and
Pacific Gas and Electric Company (incorporated by reference to PG&E
Corporation’s and Pacific Gas and Electric Company’s Form 10-K for the
year ended December 31, 2004 (File No. 1-12609 and File No. 1-2348),
Exhibit 10.9)
|
|
*10.6
|
PG&E
Corporation Supplemental Retirement Savings Plan amended effective as of
September 19, 2001, and frozen after December 31, 2004 (incorporated by
reference to PG&E Corporation’s Form 10-K for the year ended December
31, 2004) (File No. 1-12609), Exhibit 10.10)
|
|
*10.7
|
PG&E
Corporation 2005 Supplemental Retirement Savings Plan effective as of
January 1, 2005 (as amended to comply with Internal Revenue Code Section
409A regulations effective as of January 1, 2009)
|
|
*10.8
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Peter
A. Darbee effective July 1, 2003 (incorporated by reference to PG&E
Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30,
2003 (File No. 1-12609), Exhibit 10.4)
|
|
*10.9
|
Restricted
Stock Award Agreement between PG&E Corporation and Peter A. Darbee
dated January 3, 2007 (incorporated by reference to PG&E Corporation's
and Pacific Gas and Electric Company's Quarterly Report on Form 10-Q for
the quarter ended March 31, 2007 (File No. 1-12609 and File
No. 12348), Exhibit 10.3)
|
|
*10.10
|
Amendment
to January 3, 2007 Restricted Stock Agreement between PG&E Corporation
and Peter A. Darbee, effective May 9, 2008 (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended June 30, 2008 (File
No. 1-12609), Exhibit 10.1)
|
|
*10.11
|
Amended
and Restated Restricted Stock Unit Agreement between Peter A. Darbee and
PG&E Corporation (as amended to comply with Internal Revenue Code
Section 409A regulations effective as of January 1,
2009)
|
|
*10.12
|
Restricted
Stock Unit Agreement between Peter A. Darbee and PG&E Corporation
dated January 2, 2009
|
|
*10.13
|
Letter
regarding Compensation Arrangement between Pacific Gas and Electric
Company and William T. Morrow dated June 20, 2006 (incorporated by
reference to PG&E Corporation's Quarterly Report on Form 10-Q for the
quarter ended September 30, 2006 (File No. 1-12609), Exhibit
10.1)
|
|
*10.14
|
Restricted
Stock Award Agreement between PG&E Corporation and William T. Morrow
dated January 29, 2007 (incorporated by reference to PG&E
Corporation's Quarterly Report on Form 10-Q for the quarter ended March
31, 2007 (File No. 1-12609), Exhibit 10.4)
|
|
*10.15
|
Performance
Share Agreement between PG&E Corporation and William T. Morrow dated
November 6, 2007 (incorporated by reference to PG&E Corporation’s Form
10-K for the year ended December 31, 2007) (File No. 1-12609), Exhibit
10.13)
|
|
*10.16
|
Restricted
Stock Award Agreement between PG&E Corporation and William T. Morrow
dated November 6, 2007 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2007) (File No.
1-12609), Exhibit 10.14)
|
|
*10.17
|
Separation
Agreement between William T. Morrow and Pacific Gas and Electric Company
dated July 8, 2008 (incorporated by reference to PG&E Corporation's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 2008 (File No. 1-12609), Exhibit
10)
|
|
*10.18
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Rand
L. Rosenberg dated October 19, 2005 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2005) (File No.
1-12609), Exhibit 10.18)
|
|
*10.19
|
Letter
regarding Compensation Arrangement between PG&E Corporation and Hyun
Park dated October 10, 2006 (incorporated by reference to PG&E
Corporation’s Form 10-K for the year ended December 31, 2006) (File No.
1-12609), Exhibit 10.18)
|
|
*10.20
|
Letter
regarding Compensation Agreement between PG&E Corporation and G.
Robert Powell dated August 8, 2005 (incorporated by reference
to PG&E Corporation’s Form 10-K for the year ended December 31, 2007)
(File No. 1-12609), Exhibit 10.17)
|
|
*10.21
|
Letter
regarding Compensation Agreement between Pacific Gas and Electric Company
and John S. Keenan dated November 21, 2005
|
|
*10.22
|
Letter
regarding Compensation Agreement between Pacific Gas and Electric Company
and Barbara Barcon dated March 3, 2008 (incorporated by reference to
PG&E Corporation's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2008 (File No. 1-12609), Exhibit 10.3)
|
|
*10.23
|
Separation
Agreement between PG&E Corporation and G. Robert Powell dated March 6,
2008 (incorporated by reference to PG&E Corporation's Quarterly Report
on Form 10-Q for the quarter ended March 31, 2008 (File No. 1-12609),
Exhibit 10.4)
|
|
*10.24
|
PG&E
Corporation 2005 Deferred Compensation Plan for Non-Employee Directors,
effective as of January 1, 2005 (as amended to comply with Internal
Revenue Code Section 409A regulations effective as of January 1,
2009)
|
|
*10.25
|
Description
of Short-Term Incentive Plan for Officers of PG&E Corporation and its
subsidiaries, effective January 1, 2008 (incorporated by reference to
PG&E Corporation's Form 10-K for the year ended December 31, 2007
(File No. 1-12609), Exhibit 10.19)
|
|
*10.26
|
Description
of Short-Term Incentive Plan for Officers of PG&E Corporation and its
subsidiaries, effective January 1, 2009
|
|
*10.27
|
Amendment
to PG&E Corporation Short-Term Incentive Programs and Other Bonus
Programs, effective January 1, 2009 (amendment to comply with Internal
Revenue Code Section 409A regulations)
|
|
*10.28
|
Amendment
to Pacific Gas and Electric Company Short-Term Incentive Programs and
Other Bonus Programs, effective January 1, 2009 (amendment to comply with
Internal Revenue Code Section 409A regulations)
|
|
*10.29
|
Supplemental
Executive Retirement Plan of PG&E Corporation as amended effective as
of January 1, 2009 (amended to comply with Internal Revenue Code Section
409A Regulations)
|
|
*10.30
|
Pacific
Gas and Electric Company Relocation Assistance Program for
Officers
|
|
*10.31
|
Postretirement
Life Insurance Plan of the Pacific Gas and Electric Company (incorporated
by reference to Pacific Gas and Electric Company's Form 10-K for fiscal
year 1991 (File No. 1-2348), Exhibit 10.16)
|
|
*10.32
|
Amendment
to Postretirement Life Insurance Plan of the Pacific Gas and Electric
Company dated December 30, 2008 (amendment to comply with Internal Revenue
Code Section 409A regulations)
|
|
*10.33
|
PG&E
Corporation Non-Employee Director Stock Incentive Plan (a component of the
PG&E Corporation Long-Term Incentive Program) as amended effective as
of July 1, 2004 (reflecting amendments adopted by the PG&E Corporation
Board of Directors on June 16, 2004 set forth in resolutions filed as
Exhibit 10.3 to PG&E Corporation's and Pacific Gas and Electric
Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
2004
)
(incorporated by reference to PG&E Corporation’s and Pacific
Gas and Electric Company’s Form 10-K for the year ended December 31, 2004
(File No. 1-12609 and File No. 1-2348), Exhibit 10.27)
|
|
*10.34
|
Resolution
of the PG&E Corporation Board of Directors dated February 20, 2008,
adopting director compensation arrangement effective January 1,
2008 (incorporated by reference to PG&E Corporation's and Pacific
Gas and Electric Company's Quarterly Report on Form 10-K for the year
ended December 31, 2007 (File No. 1-12609 and File No. 12348),
Exhibit 10.28)
|
|
*10.35
|
Resolution
of the Pacific Gas and Electric Company Board of Directors dated February
20, 2008, adopting director compensation arrangement effective January 1,
2008 (incorporated by reference to PG&E Corporation's and Pacific
Gas and Electric Company's Quarterly Report on Form 10-K for the year
ended December 31, 2007 (File No. 1-12609 and File No. 12348),
Exhibit 10.29)
|
|
*10.36
|
Resolution
of the PG&E Corporation Board of Directors dated September 17, 2008,
adopting director compensation arrangement effective January 1,
2009
|
|
*10.37
|
Resolution
of the Pacific Gas and Electric Company Board of Directors dated September
17, 2008, adopting director compensation arrangement effective January 1,
2009
|
|
*10.38
|
PG&E
Corporation 2006 Long-Term Incentive Plan, as amended through February 18,
2009
|
|
*10.39
|
PG&E
Corporation Long-Term Incentive Program (including the PG&E
Corporation Stock Option Plan and Performance Unit Plan), as amended May
16, 2001, (incorporated by reference to PG&E Corporation's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2001 (File
No. 1-12609), Exhibit 10)
|
|
*10.40
|
Form
of Restricted Stock Award Agreement for 2004 grants made under the
PG&E Corporation Long-Term Incentive Program (incorporated by
reference to PG&E Corporation's Form 10-K for the year ended December
31, 2003 (File No. 1-12609), Exhibit 10.37)
|
|
*10.41
|
Form
of Restricted Stock Agreement for 2005 grants under the PG&E
Corporation Long-Term Incentive Program (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.3)
|
|
*10.42
|
Form
of Restricted Stock Agreement for 2006 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 9, 2006, Exhibit 99.1)
|
|
*10.43
|
Form
of Restricted Stock Agreement for 2007 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (reflecting amendments to the
PG&E Corporation 2006 Long-Term Incentive Plan made on February 15,
2006) (incorporated by reference to PG&E Corporation's Form 10-K for
the year ended December 31, 2006 (File No. 1-12609),
Exhibit 10.39)
|
|
*10.44
|
Form
of Restricted Stock Agreement for 2008 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended March 31, 2008
(File No. 1-12609), Exhibit 10.5)
|
|
*10.45
|
Form
of Amendment to Restricted Stock Agreements for grants made between
January 2005 and March 2008 (amendments to comply with Internal Revenue
Code Section 409A Regulations)
|
|
*10.46
|
Form
of Non-Qualified Stock Option Agreement under the PG&E Corporation
Long-Term Incentive Program (incorporated by reference to PG&E
Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.1)
|
|
*10.47
|
Form
of Performance Share Agreement for 2005 grants under the PG&E
Corporation Long-Term Incentive Program (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 6, 2005 (File No. 12609 and File No. 1-2348),
Exhibit 99.2)
|
|
*10.48
|
Form
of Performance Share Agreement for 2006 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation and Pacific Gas and Electric Company's Form 8-K filed
January 9, 2006, Exhibit 99.2)
|
|
*10.49
|
Form
of Performance Share Agreement for 2007 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (reflecting amendments to the
PG&E Corporation 2006 Long-Term Incentive Plan made on February 15,
2006) (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2006 (File No. 1-12609),
Exhibit 10.44)
|
|
*10.50
|
Form
of Performance Share Agreement for 2008 grants under the PG&E
Corporation 2006 Long-Term Incentive Plan (incorporated by reference to
PG&E Corporation's Form 10-Q for the quarter ended March 31, 2008
(File No. 1-12609), Exhibit 10.6)
|
|
*10.51
|
|
Form
of Amended and Restated Performance Share Agreement for 2006 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
*10.52
|
Form
of Amended and Restated Performance Share Agreement for 2007 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.53
|
Form
of Amended and Restated Performance Share Agreement for 2008 grants
(amendments to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.54
|
PG&E
Corporation Executive Stock Ownership Program Guidelines as amended
effective February 17, 2009
|
|
*10.55
|
PG&E
Corporation Officer Severance Policy, as amended effective as of February
15, 2006 (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2005 (File No. 1-12609),
Exhibit 10.48)
|
|
*10.56
|
PG&E
Corporation Officer Severance Policy, as amended effective as of January
1, 2009 (amended to comply with Internal Revenue Code Section 409A
regulations)
|
|
*10.57
|
PG&E
Corporation Golden Parachute Restriction Policy effective as of February
15, 2006 (incorporated by reference to PG&E Corporation's Form 10-K
for the year ended December 31, 2005 (File No. 1-12609),
Exhibit 10.49)
|
|
*10.58
|
Amendment
to PG&E Corporation Golden Parachute Restriction Policy dated December
31, 2008 (amendment to comply with Internal Revenue Code Section 409A
Regulations)
|
|
*10.59
|
PG&E
Corporation Director Grantor Trust Agreement dated April 1, 1998
(incorporated by reference to PG&E Corporation's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1998 (File No. 1-12609),
Exhibit 10.1)
|
|
*10.60
|
PG&E
Corporation Officer Grantor Trust Agreement dated April 1, 1998, as
updated effective January 1, 2005 (incorporated by reference to PG&E
Corporation's Form 10-K for the year ended December 31, 2004 (File
No. 1-12609), Exhibit 10.39)
|
|
*10.61
|
Resolution
of the Board of Directors of PG&E Corporation regarding
indemnification of officers and directors dated December 18, 1996
(incorporated by reference to PG&E Corporation's Form 10-K for the
year ended December 31, 2004 (File No. 1-12609),
Exhibit 10.40)
|
|
*10.62
|
Resolution
of the Board of Directors of Pacific Gas and Electric Company regarding
indemnification of officers and directors dated July 19, 1995
(incorporated by reference to Pacific Gas and Electric Company’s Form 10-K
for the year ended December 31, 2004 (File No. 1-2348),
Exhibit 10.41)
|
|
11
|
Computation
of Earnings Per Common Share
|
|
12.1
|
Computation
of Ratios of Earnings to Fixed Charges for Pacific Gas and Electric
Company
|
|
12.2
|
Computation
of Ratios of Earnings to Combined Fixed Charges and Preferred Stock
Dividends for Pacific Gas and Electric Company
|
|
13
|
The
following portions of the 2008 Annual Report to Shareholders of PG&E
Corporation and Pacific Gas and Electric Company are included: “Selected
Financial Data,” “Management's Discussion and Analysis of Financial
Condition and Results of Operations,” financial statements of PG&E
Corporation entitled “Consolidated Statements of Income,” “Consolidated
Balance Sheets,” “Consolidated Statements of Cash Flows,” and
“Consolidated Statements of Shareholders' Equity,” financial statements of
Pacific Gas and Electric Company entitled “Consolidated Statements of
Income,” “Consolidated Balance Sheets,” “Consolidated Statements of Cash
Flows,” and “Consolidated Statements of Shareholders' Equity,” “Notes to
the Consolidated Financial Statements,” “Quarterly Consolidated Financial
Data (Unaudited),” “Management's Report on Internal Control Over Financial
Reporting,” and “Report of Independent Registered Public Accounting
Firm.”
|
|
21
|
Subsidiaries
of the Registrant
|
|
23
|
Consent
of Independent Registered Public Accounting Firm (Deloitte & Touche
LLP)
|
|
24.1
|
Resolutions
of the Boards of Directors of PG&E Corporation and Pacific Gas and
Electric Company authorizing the execution of the Form
10-K
|
|
24.2
|
Powers
of Attorney
|
|
31.1
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of PG&E
Corporation required by Section 302 of the Sarbanes-Oxley Act of
2002
|
|
31.2
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of Pacific
Gas and Electric Company required by Section 302 of the Sarbanes-Oxley Act
of 2002
|
|
**32.1
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of PG&E
Corporation required by Section 906 of the Sarbanes-Oxley Act of
2002
|
|
**32.2
|
Certifications
of the Chief Executive Officer and the Chief Financial Officer of Pacific
Gas and Electric Company required by Section 906 of the Sarbanes-Oxley Act
of 2002
|
2. Definitions.....................................................................................................................1
|
3. Employer
Contributions..............................................................................................3
|
4. Eligible
Employee
Deferrals........................................................................................4
|
5. Investment
Funds....................................................................................................... 5
|
6. Accounting..................................................................................................................
6
|
7. Distributions ................................................................................................................6
|
8. Distribution
Due to Unforeseeable Emergency (Hardship
Distribution).............8
|
9. Domestic
Relations
Orders.........................................................................................
9
|
10. Vesting........................................................................................................................ 9
|
11. Administration
of the
Plan....................................................................................... 9
|
12. Funding......................................................................................................................
10
|
13. Modification
or Termination of
Plan...................................................................... 10
|
14. General
Provisions ................................................................................................... 10
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
The
LTIP and Other Agreements
|
This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Restricted Stock Units, subject to the terms of
the LTIP. Any prior agreements, commitments, or negotiations
are superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern. Capitalized terms that are not defined in this
Agreement are defined in the LTIP. In the event of any conflict
or inconsistency between the provisions of this Agreement and the PG&E
Corporation Officer Severance Policy, this Agreement shall govern. For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
|
Grant
of Restricted Stock Units
|
PG&E
Corporation grants you the number of Restricted Stock Units shown on the
cover sheet of this Agreement. The Restricted Stock Units are
subject to the terms and conditions of this Agreement and the
LTIP.
|
Vesting
of Restricted Stock Units
|
As
long as you remain employed with PG&E Corporation, 100 percent of the
total number of Restricted Stock Units originally subject to this
Agreement, as shown above on the cover sheet, will vest on the first
business day of January of 2013 (the “Vesting Date”). Except as
described below, all Restricted Stock Units subject to this Agreement
which have not vested shall be cancelled upon termination of your
employment.
|
Dividends
|
Restricted
Stock Units will accrue Dividend Equivalents that will be converted into
additional Restricted Stock Units based on the Fair Market Value of a
share of PG&E Corporation common stock on the dividend payment
date. Such additional Restricted Stock Units will be subject to
the same terms and conditions as the underlying Restricted Stock
Units.
|
Settlement
|
Vested
Restricted Stock Units will be settled in an equal number of shares of
PG&E Corporation common stock. PG&E Corporation shall issue such
shares as soon as practicable after the Restricted Stock Units vest upon
Vesting Date (but not later than ninety (90) days after the Vesting Date);
provided, however, that such issuance shall be made with respect to all of
your outstanding vested Restricted Stock Units (after giving effect to the
vesting provisions described below) as soon as practicable after (but not
later than ninety (90) days after) your separation from service (within
the meaning of Code Section 409A), if such separation occurs earlier than
the Vesting Date.
|
Voluntary
Termination/ Retirement
1
|
In
the event of your voluntary termination/Retirement, a prorated portion of
the Restricted Stock Units will vest at the time of your separation from
service in accordance with the percentage of time you were employed with
PG&E Corporation during the vesting period. All other
unvested Restricted Stock Units shall be cancelled on the date of
termination.
|
Termination
for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all Restricted Stock Units
will be cancelled on the date of termination. In general,
termination for “cause” means termination of employment because of
dishonesty, a criminal offense or violation of a work rule, and will be
determined by and in the sole discretion of PG&E
Corporation.
|
Termination
other than for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, a prorated
portion of the Restricted Stock Units will vest at the time of your
separation from service in accordance with the percentage of time you were
employed with PG&E Corporation during the vesting period (except as
otherwise provided below in connection with a Change in
Control). All other unvested Restricted Stock Units shall be
cancelled on the date of termination.
|
Death/Disability
|
If
you separate from service due to your death or Disability, all of your
Restricted Stock Units shall vest on the date of separation.
|
Termination
Due to Disposition of Subsidiary
|
(1)
If your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Internal Revenue Code of 1986, as
amended (the “Code”), or (2) if your employment is terminated (other than
for cause or your voluntary termination) coincident with the sale of all
or substantially all of the assets of a subsidiary of PG&E
Corporation, the Restricted Stock Units shall vest in the same manner as
for a “Termination other than for Cause” described above.
|
Change
in Control
|
In
the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or other business entity or parent thereof, as the
case may be (the “Acquiror
”
), may, without your
consent, either assume or continue PG&E Corporation’s rights and
obligations under this Agreement or provide a substantially equivalent
award in substitution for the Restricted Stock Units subject to this
Agreement.
If
the Restricted Stock Units are neither assumed nor continued by the
Acquiror or if the Acquiror does not provide a substantially equivalent
award in substitution for the Restricted Stock Units, all of your
outstanding Restricted Stock Units shall automatically vest immediately
preceding and contingent on, the Change in Control and shall be settled on
the Vesting Date, subject to earlier settlement upon your separation from
service.
|
Termination
In Connection with a Change in Control
|
If
your employment is terminated by PG&E Corporation (other than for
cause) (i) following a Potential Change in Control (defined below) or (ii)
within two years following the Change in Control, all of your outstanding
Restricted Stock Units (to the extent they did not previously vest upon,
for example, failure of the Acquiror to assume or continue this Award)
shall automatically vest on the date of your separation from
service.
“Potential
Change in Control” shall mean the earliest to occur of (i) the
date on which the PG&E Corporation executes an agreement or letter of
intent, where the consummation of the transaction described therein would
result in the occurrence of a Change in Control, (ii) the date on which
the Board of Directors of PG&E Corporation approves a transaction or
series of transactions, the consummation of which would result in a Change
in Control, or (iii) the date on which a tender offer for PG&E
Corporation’s voting stock is publicly announced, the completion of which
would result in a Change in Control.
|
Delay
|
PG&E
Corporation shall delay the issuance of any shares of common stock to the
extent it is necessary to comply with Section 409A(a)(2)(B)(i) of the Code
(relating to payments made to certain “key employees” of certain
publicly-traded companies); in such event, any shares of common stock to
which you would otherwise be entitled during the six (6) month period
following the date of your “separation from service” under Section 409A
(or shorter period ending on the date of your death following such
separation) will instead be issued on the first business day following the
expiration of the applicable delay period.
|
Withholding
Taxes
|
Prior to any event in connection with the
Restricted Stock Units (e.g., vesting) that PG&E Corporation
determines may result in any tax withholding obligation, whether United
States federal, state, local
,
or
non-U.S., including any social insurance, employment tax, payment on
account
,
or other tax-related obligation (the “Tax
Withholding Obligation”), you must arrange for the satisfaction of the
minimum amount of such Tax Withholding Obligation in a manner acceptable
to PG&E Corporation.
Subject to any applicable PG&E Corporation
policies, a
t any time not less than
five (5) business days (or such fewer number of business days as
determined by PG&E Corporation) before any Tax Withholding Obligation
arises (e.g., a
V
esting
D
ate), you
may instruct PG&E Corporation to withhold from those shares otherwise
issuable to you the whole number of shares sufficient to satisfy the
minimum applicable Tax Withholding Obligation. You acknowledge
that the withheld shares may not be sufficient to satisfy your minimum Tax
Withholding Obligation. Accordingly, you agree to pay to
PG&E Corporation as soon as practicable, including through additional
payroll withholding, any amount of the Tax Withholding Obligation that is
not satisfied by the withholding of shares described
above.
|
Leaves
of Absence
|
For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation sponsored disability benefits, you will be considered to have
voluntarily terminated your employment. See above under
“Voluntary Termination/Retirement.”
Notwithstanding
the foregoing, if the leave of absence exceeds six (6) months, and a
return to service upon expiration of such leave is not guaranteed by
statute or contract, then you shall be deemed to have had a “separation
from service” for purposes of any Restricted Stock Units that are settled
hereunder upon such separation. To the extent an authorized
leave of absence is due to a medically determinable physical or mental
impairment that can be expected to result in death or to last for a
continuous period of at least six (6) months and such impairment causes
you to be unable to perform the duties of your position of employment or
any substantially similar position of employment, the six (6) month period
in the prior sentence shall be twenty-nine (29) months.
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
|
Voting
and Other Rights
|
You
shall not have voting rights with respect to the Restricted Stock Units
until the date the underlying shares are issued (as evidenced by
appropriate entry on the books of PG&E Corporation or its duly
authorized transfer agent).
|
No
Retention Rights
|
This
Agreement is not an employment agreement and does not give you the right
to be retained by PG&E Corporation. Except as otherwise
provided in an applicable employment agreement, PG&E Corporation
reserves the right to terminate your employment at any time and for any
reason.
|
Applicable
Law
|
This
Agreement will be interpreted and enforced under the laws of the State of
California.
|
The
LTIP and Other Agreements
|
This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Restricted Stock Units, subject to the terms of
the LTIP. Any prior agreements, commitments, or negotiations
are superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern. Capitalized terms that are not defined in this
Agreement are defined in the LTIP. In the event of any conflict
or inconsistency between the provisions of this Agreement and the PG&E
Corporation Officer Severance Policy, this Agreement shall govern. For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
|
Grant
of Restricted Stock Units
|
PG&E
Corporation grants you the number of Restricted Stock Units shown on the
cover sheet of this Agreement. The Restricted Stock Units are
subject to the terms and conditions of this Agreement and the
LTIP.
|
Vesting
of Restricted Stock Units
|
As
long as you remain employed with PG&E Corporation, 100 percent of the
total number of Restricted Stock Units originally subject to this
Agreement, as shown above on the cover sheet, will vest on the first
business day of January of 2012 (the “Vesting Date”). Except as
described below, all Restricted Stock Units subject to this Agreement
which have not vested shall be cancelled upon termination of your
employment.
|
Dividends
|
Restricted
Stock Units will accrue Dividend Equivalents that will be converted into
additional Restricted Stock Units based on the Fair Market Value of a
share of PG&E Corporation common stock on the dividend payment
date. Such additional Restricted Stock Units will be subject to
the same terms and conditions as the underlying Restricted Stock
Units.
|
Settlement
|
Vested
Restricted Stock Units will be settled in an equal number of shares of
PG&E Corporation common stock. PG&E Corporation shall issue such
shares as soon as practicable after the Restricted Stock Units vest
upon Vesting Date (but not later than ninety (90)
days after the Vesting Date); provided, however, that such issuance shall
be made with respect to all of your outstanding vested Restricted Stock
Units (after giving effect to the vesting provisions described below) as
soon as practicable after (
but not later than ninety (90) days
after
) your separation from service (within
the meaning of Code Section 409A), if such separation occurs earlier than
the Vesting
Date
.
|
Voluntary
Termination/ Retirement
1
|
In
the event of your voluntary termination/Retirement, a prorated portion of
the Restricted Stock Units will vest
at the
time of your separation from service
in accordance with the
percentage of time you were employed with PG&E Corporation during the
vesting period. All other unvested Restricted Stock Units shall
be cancelled on the date of termination.
|
Termination
for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all Restricted Stock Units
will be cancelled on the date of termination. In general,
termination for “cause” means termination of employment because of
dishonesty, a criminal offense or violation of a work rule, and will be
determined by and in the sole discretion of PG&E
Corporation.
|
Termination
other than for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, a prorated
portion of the Restricted Stock Units will vest
at the time of your separation from service
in accordance with the percentage of time you were employed with PG&E
Corporation during the vesting period (except as otherwise provided below
in connection with a Change in Control). All other unvested
Restricted Stock Units shall be cancelled on the date of
termination.
|
Death/Disability
|
If
you separate from service
due to your
death or Disability, all of your Restricted Stock Units shall vest on the
date of
separation
.
|
Termination
Due to Disposition of Subsidiary
|
(1)
If your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Internal Revenue Code of 1986, as
amended (the “Code”), or (2) if your employment is terminated (other than
for cause or your voluntary termination) coincident with the sale of all
or substantially all of the assets of a subsidiary of PG&E
Corporation, the Restricted Stock Units shall vest in the same manner as
for a “Termination other than for Cause” described above.
|
Change
in Control
|
In
the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or other business entity or parent thereof, as the
case may be (the “Acquiror
”
), may, without your
consent, either assume or continue PG&E Corporation’s rights and
obligations under this Agreement or provide a substantially equivalent
award in substitution for the Restricted Stock Units subject to this
Agreement.
If
the Restricted Stock Units are neither assumed nor continued by the
Acquiror or if the Acquiror does not provide a substantially equivalent
award in substitution for the Restricted Stock Units, all of your
outstanding Restricted Stock Units shall automatically vest immediately
preceding and contingent on, the Change in Control and
shall be settled on the Vesting Date, subject to
earlier settlement upon your separation from
service.
|
Termination
In Connection with a Change in Control
|
If
your employment is terminated
by PG&E
Corporation
(other than
for cause)
(i) following a Potential
Change in Control
(defined below) or
(ii)
within two years following the Change in Control, all of your
outstanding Restricted Stock Units (to the extent they did not previously
vest upon, for example, failure of the Acquiror to assume or continue this
Award) shall automatically vest on the date of
your separation from service.
"Potential Change in Control" shall mean the
earliest to occur of (i) the date on which the PG&E
Corporation executes an agreement or letter of intent, where the
consummation of the transaction described therein would result in the
occurrence of a Change in Control, (ii) the date on which the Board of
Directors of PG&E Corporation approves a transaction or series of
transactions, the consummation of which would result in a Change in
Control, or (iii) the date on which a tender offer for PG&E
Corporation’s voting stock is publicly announced, the completion of which
would result in a Change in Control.
|
Delay
|
PG&E
Corporation shall delay the issuance of any shares of common stock to the
extent it is necessary to comply with Section 409A(a)(2)(B)(i) of the Code
(relating to payments made to certain “key employees” of certain
publicly-traded companies); in such event, any shares of common stock to
which you would otherwise be entitled during the six (6) month period
following the date of your “separation from service” under Section 409A
(or shorter period ending on the date of
your death following such separation) will instead
be issued on the
first business day following the expiration of the
applicable delay
period.
|
Withholding
Taxes
|
Prior to any event in connection with the
Restricted Stock Units (e.g., vesting) that PG&E Corporation
determines may result in any tax withholding obligation, whether United
States federal, state, local, or non-U.S., including any social insurance,
employment tax, payment on account, or other tax-related obligation (the
“Tax Withholding Obligation”), you must arrange for the satisfaction of
the minimum amount of such Tax Withholding Obligation in a manner
acceptable to PG&E Corporation.
At any time not less than five (5) business days
(or such fewer number of business days as determined by PG&E
Corporation) before any Tax Withholding Obligation arises (e.g., a Vesting
Date), you may instruct PG&E Corporation to withhold from those shares
otherwise issuable to you the whole number of shares sufficient to satisfy
the minimum applicable Tax Withholding Obligation. You
acknowledge that the withheld shares may not be sufficient to satisfy your
minimum Tax Withholding Obligation. Accordingly, you agree to
pay to PG&E Corporation as soon as practicable, including through
additional payroll withholding, any amount of the Tax Withholding
Obligation that is not satisfied by the withholding of shares described
above.
|
Leaves
of Absence
|
For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation sponsored disability benefits, you will be considered to have
voluntarily terminated your employment. See above under
“Voluntary Termination/Retirement.”
Notwithstanding
the foregoing, if the leave of absence exceeds six (6) months, and a
return to service upon expiration of such leave is not guaranteed by
statute or contract, then you shall be deemed
to have had
a “separation from service”
for purposes of any Restricted Stock Units
that are settled hereunder upon such separation
. To the
extent an authorized leave of absence is due to a medically determinable
physical or mental impairment that can be expected to result in death or
to last for a continuous period of at least six (6) months and such
impairment causes you to be unable to perform the duties of your position
of employment or any substantially similar position of employment, the six
(6) month period in the prior sentence shall be twenty-nine (29)
months.
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
|
Voting
and Other Rights
|
You
shall not have voting rights with respect to the Restricted Stock Units
until the date the underlying shares are issued (as evidenced by
appropriate entry on the books of PG&E Corporation or its duly
authorized transfer agent).
|
No
Retention Rights
|
This
Agreement is not an employment agreement and does not give you the right
to be retained by PG&E Corporation. Except as otherwise
provided in an applicable employment agreement, PG&E Corporation
reserves the right to terminate your employment at any time and for any
reason.
|
Applicable
Law
|
This
Agreement will be interpreted and enforced under the laws of the State of
California.
|
Thomas
B. King
Executive
Vice President and
Chief
Operating Officer
|
Mailing
Address:
Mail
Code B32
P.
O. Box 770000
San
Francisco, CA 94177-0001
|
||
November
21, 2005
|
|||
Overnight
Mail:
|
|||
Pacific
Gas and Electric Company
|
|||
77
Beale Street, 32nd Floor
|
|||
Mr.
John S. Keenan
|
|||
108
Braewynds Lane
|
415.973.7431
|
||
Holly
Springs, NC 27540
|
Fax:
415.973.9485
|
||
1.
|
An
annual base salary of $350,000 ($29,166.67/month) subject to possible
increases through our annual salary review
plan.
|
2.
|
A
one-time bonus of $200,000 payable within 60 days of your date of hire,
subject to normal tax withholdings. Should you leave the
company or should your employment be terminated for cause within three
years of your date of hire, a prorated amount of this bonus must be
refunded to the company.
|
3.
|
A
target incentive of $175,000 (50% of your base salary) in an annual
short-term incentive plan under which your actual incentive dollars may
range from zero to $350,000 based on performance relative to established
goals. If your date of hire is in 2005, this incentive will be
prorated for the number of months worked from your date of hire and will
be payable in 2006.
|
4.
|
A
one-time additional incentive tied to the improvement of the performance
of Diablo Canyon Power Plan (DCPP). Specifically, 50 percent of
your 2006 annual short-term incentive plan award will be tracked in a
phantom account contingent upon INPO’s next rating of DCPP, which is
scheduled to occur in the spring of 2007. If the 2007 INPO
rating is a 1, the amount tracked in the phantom account will be paid to
you.
|
5.
|
Participation
in the PG&E Corporation Long-Term Incentive Plan (LTIP) as a band
3 officer. Grants under the LTIP are split equally
between restricted stock and performance shares, and are generally made
annually on the first business day of the year. Your initial
grant will be made on the first business day of January 2006 and will have
an estimated current value of $400,000. This estimated value is
used only for the purpose of determining the number of shares for your
grant. The ultimate value that you realize from this grant will
depend upon your employment status and the performance of PG&E
Corporation common stock.
|
6.
|
A
one-time supplement LTIP grant with an estimated current value of
$200,000. This grant will be apportioned and made in the same
manner as the grant described in item
5.
|
7.
|
Participation
in the PG&E Corporation Supplemental Executive Retirement Plan (SERP).
The basic benefit payable from the SERP at retirement is a monthly annuity
equal to the product of 1.7% x [average of the three highest years’
combination of salary and annual incentive for the last ten years of
service] x years of credited service x 1/12 less any amounts paid or
payable from the Pacific Gas and Electric Company Retirement
Plan (RP). During each of your first seven complete
years of employment, you will receive 1½ years of credited service,
resulting in a total of 10½ years of service at the end of seven years of
employment. Thereafter, you will receive one year of credited
service for each additional year of
employment.
|
8.
|
Conditioned
upon meeting plan requirements, you will also be eligible for
post-retirement life insurance and post-retirement medical benefits upon
retirement under the RP.
|
9.
|
Participation
in the PG&E Corporation Retirement Savings Plan (RSP), a 401(k)
savings plan. You will be eligible to contribute as much as 20%
of your salary on either a pre-tax or after-tax basis. After
your first year of service, we will match contributions you make up to 3%
of your salary at 75 cents on each dollar contributed. After
three years of service, we will match contributions up to 6% of your
salary at 75 cents on each dollar contributed. All of the above
contributions are subject to the applicable legal
limits.
|
10.
|
Participation
in the PG&E Corporation Supplemental Retirement Savings Plan (SRSP), a
non-qualified, deferred compensation plan. You may elect to
defer payment of some of your compensation on a pre-tax
basis. We will provide you with the full matching contributions
that cannot be provided through the RSP, due to legal limitations imposed
on highly compensated employees.
|
11.
|
As
a result of your officer level (officer band 3), you will become an
eligible participant under the Executive Stock Ownership Program effective
January 1, 2007. As an ancillary benefit to that program, you
will also be eligible to receive financial counseling from The AYCO
Company at a subsidized rate to assist you in your understanding of our
compensation and benefits programs and how those programs can help you to
achieve financial security. For this feature of the program,
you will be eligible as of January 1,
2006.
|
12.
|
Participation
in a cafeteria-style benefits program that permits you to select coverage
tailored to your personal needs and circumstances. The benefits
you elect will be effective the first of the month following the date of
your hire.
|
13.
|
An
annual vacation allotment of four weeks, subject to future increases based
on length of service. If your date of hire is in 2005, the
vacation allotment will be prorated based on your date of
hire. In addition, Pacific Gas and Electric Company recognizes
10 paid company holidays annually and provides 3 floating holidays
immediately upon hire and at the beginning of each
year.
|
14.
|
An
annual perquisite allowance of $20,000 to be used in lieu of individual
authorizations for cars and memberships in clubs and civic
organizations. If your date of hire is in 2005, you will
receive half of this amount ($10,000) for
2005.
|
15.
|
Participation
in the Employee Discount program after six months of continuous service
following your date of hire. The program offers participant’s a
25% discount on electricity and gas rates for their primary
residence. In order to receive this benefits, you must (a) live
within Pacific Gas and Electric Company’s service territory and (b) have
the service in your name at your primary
residence.
|
16.
|
A
comprehensive executive relocation assistance package, including: (1) the
reimbursement of closing costs on the sale of your current residence,
contingent upon using a PG&E-designated relocation company and
purchasing a new residence, (2) the move of your household goods,
including 60 days of storage and the movement of the goods out of storage,
and (3) a lump sum payment of $10,000 payable within 60 days of your date
of employment. In addition, the package will include financial
assistance in the form of a monthly mortgage subsidy of $3,000 (interest
only) for a period of 60 months. This subsidy is contingent
upon the following: (1) your purchase of a principal residence (within 50
miles of your work location) within one year of your date of hire, (2)
your satisfying typical mortgage qualification criteria, and (3) use of a
company-designated lender. Should you have any questions
regarding the relocation package, please contact Denise Nicco, Director of
Relocation at (415) 817-8230.
|
2.
Definitions ................................................................................................................1
|
3.
Eligibility ...................................................................................................................2
|
4.
Deferrals ....................................................................................................................2
|
5.
Investment
Funds.................................................................................................... 3
|
6.
Accounting ...............................................................................................................3
|
7.
Distributions .............................................................................................................4
|
8.
Distribution
Due to Unforeseeable Emergency (Hardship
Distribution)......... 6
|
9.
Vestng ........................................................................................................................6
|
10.
Administration of the
Plan.................................................................................... 6
|
11.
Funding ...................................................................................................................6
|
12.
Modification or
Termination of
Plan ...................................................................7
|
13.
General
Providions of the
Plan .............................................................................7
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
Measure
|
Relative
Weight
|
2008
Results
|
2009
Target
|
|||||||||
Customer
Satisfaction and Brand Health Index (Residential & Business)
(2)
|
17.5 | % | 76.1 | 76.1 | ||||||||
Reliable Energy Delivery
Index
(3)
|
17.5 | % | 1.443 | 1.0 | ||||||||
Employee Survey (Premier)
Index
(4)
|
5 | % | 68.57 | % | 69.5 | % | ||||||
Occupational
Safety and Health Administration (OSHA) Recordable Injury Rate
(5)
|
10 | % | 3.241 | 2.755 |
1.
|
As
explained above, 50% of the STIP award will be based on achievement of
corporate earnings from operations
targets.
|
2.
|
The
Customer Satisfaction and Brand Health Index is the result of a quarterly
survey performed by an independent research firm, Research International,
and is a combination of a customer satisfaction score, which has a 75%
weighting, as well as a brand favorability score (measuring the relative
strength of the PG&E brand against a select group of companies), which
has a 25% weighting. The customer satisfaction score will
measure overall satisfaction with the Utility’s operational performance in
delivering its services. The brand favorability score will
measure residential, small business and medium business customer
perceptions.
|
3.
|
The
Reliable Energy Delivery Index is a composite index score that measures
leading indicators of electric and gas reliability performance, including
electric outage frequency and duration (System Average Interruption
Frequency Index (SAIFI), Customer Average Interruption Duration Index
(CAIDI)) and performance improvement in the resurvey of the Utility’s gas
system.
|
4.
|
The
Premier Survey is the primary tool used to measure employee engagement at
PG&E Corporation and the Utility. The employee index is
designed around 15 key drivers of employee engagement and organizational
health. The average overall employee survey index score
provides a comprehensive metric that is derived by adding the percent of
favorable responses from all 40 core survey items (all of which fall into
one of 15 broader topical areas), and then dividing the total sum by
40.
|
5.
|
An
“OSHA Recordable” is an occupational (job-related) injury or illness that
requires medical treatment beyond first aid, or results in work
restrictions, death or loss of consciousness. The “OSHA Recordable Rate”
is the number of OSHA Recordables for every 200,000 hours worked, or for
approximately 100 employees. This metric measures the
percentage reduction in the PG&E Corporation’s and the Utility’s OSHA
Recordable rate from the prior year and is used to monitor the
effectiveness of the companies’ safety programs, which are intended to
significantly reduce the number and degree of employee injuries and
illnesses.
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
CONTENTS
|
Pages
|
ELIGIBILITY
|
1
|
PAYBACK
AGREEMENT
|
1
|
RELOCATION
ASSISTANCE CHECKLIST
|
2
|
MOVE
ALLOWANCE
|
3
|
HOUSE
HUNTING
|
4
|
HOUSEHOLD
MOVE AND STORAGE
|
5
|
Move Instructions
|
6
|
SELECTING
A REAL ESTATE AGENT
|
12
|
PG&E REALTOR
NETWORK
|
12
|
HOME
SALE ASSISTANCE PROGRAM
|
15
|
Introduction
|
16
|
Overview
|
17
|
Eligibility
|
18
|
Required
Inspections/Disclosures
|
21
|
Options
|
22
|
Listing Your Home For
Sale
|
22
|
Marketing
|
23
|
The Appraisal
Process
|
24
|
How the Appraisal Process
Works
|
25
|
Appraisal Input_
|
29
|
Brokers' Price
Opinion
|
29
|
Amended Value
Program
|
30
|
Appraised Value
Offer
|
31
|
Payment of Equity
|
32
|
Final Equity
Payment
|
33
|
Things You Need to
Do
|
34
|
Vacating Your
Home
|
35
|
Walkthrough
Checklist
|
36
|
Pages
|
|
HOME
SALE - DIRECT REIMBURSEMENT
|
38
|
REIMBURSEMENT
FOR CLOSING COSTS
|
38
|
TAXES
|
39
|
TIME
|
39
|
USE
OF COMPANY CAR
|
39
|
APPENDIX
|
40
|
Helpful Hints when buying or
Selling a Home
|
40
|
Closing Costs Associated with the
Sale of a Home
|
42
|
Closing Costs Associated with the
Purchase of a Home
|
44
|
Appointment Log
|
46
|
Questions and
Answers
|
47
|
Glossary of Terms
|
51
|
Tax Summary
|
53
|
Example of Tax Gross Up
Procedure
|
55
|
●
|
Your
new commute must be AT LEAST 50 miles FURTHER than your current
commute. To determine
eligibility:
|
|
Mileage
from CURRENT home to NEW
headquarters:
miles
|
|
Mileage
from CURRENT home to CURRENT
headquarters: (
miles)
|
|
Difference
must equal 50 miles or
more.
miles
|
●
|
Moves
over 100 miles require the new residence to be within 50 miles of the new
headquarters. You are encouraged to consult with Relocation
Services to verify the maximum allowable distance from the new
headquarters.
|
●
|
Moves
less than 100 miles require that the commute be reduced by at least 50
percent.
|
●
|
You
must relocate your primary residence within one year from the effective
date of hire. Establishing a permanent residence is defined as
the employee
and
family establishing a permanent tax base. Traveling back to the
principle residence on weekends from an apartment, mobile home, motor
home, rented room or company housing will not qualify for relocation
assistance.
|
|
(1) In
order to quality, new rate must be at least 10 percent and exceed
current
|
|
rate
by at least 2 percent.
|
|
NOTE: All
relocation assistance must be requested within
one
year
of the
|
|
effective
date of hire.
|
|
MOVE
ALLOWANCE
|
●
|
Travel
expenses not covered by policy
|
●
|
Temporary
housing not covered by policy
|
●
|
Commuting
costs
|
●
|
Additional
income tax liability
|
●
|
Express
Mail Charges (Federal Express, UPS, Airborne Express,
etc.)
|
●
|
Notary
fees
|
●
|
Connecting
utilities, TV antenna, etc.
|
●
|
Concessions
negotiated in the sale of a home
|
●
|
Installation
of major appliances
|
●
|
Pet
expenses: moving, kennel etc.
|
●
|
Losses
of fees for subscriptions, memberships, schools, safety deposit
box
|
●
|
Automobile
registration fees, licenses, or smog control charges
|
●
|
Spouse/Domestic
Partner employment costs
|
●
|
Tips
|
●
|
Cleaning,
trash/debris removal
|
●
|
Purchase,
alteration, installation of window and floor coverings
|
●
|
Laundry
and cleaning
|
●
|
Personal
telephone calls (long distance, cell phone charges)
|
●
|
Child
care expenses
|
●
|
Extra
pick-ups for
removal of packing boxes, etc.
|
●
|
Extra
delivery charges
for moves From/To more than one location
|
●
|
Travel
home on weekends
|
●
|
Wine
and wine cellar shipment
|
Travel:
|
Advance
purchase coach airfare
|
Lodging:
|
PG&E
designated hotel or equivalent
|
Rental
car:
|
4
days plus gas
|
Meals:
|
$75/day
maximum for adults and children 16 years of age and older $40/day maximum
for children under 16 years of age
|
Alcoholic
beverages are not reimbursed
|
|
Ground
transportation:.
|
If
required, taxi.
|
Travel:
|
Travel
for employee, spouse/domestic partner and dependent
children
|
Advance
purchase, coach airfare
|
|
Lodging:
|
Up
to 3 nights at a PG&E designated hotel. This lodging is
meant to cover the night(s) the employee may not be able to stay in the
former residence because household goods have been
removed
|
OR
at the new location as they cannot yet move into the new
residence
|
|
Meals:
|
Up
to 3 days, at the maximum rates noted above.
|
Alcoholic
beverages are not reimbursed.
|
● |
Cost
of packing, moving, and unpacking your household
goods. Unpacking is defined as removing the packed articles
from the box in the appropriate room and the removal of the packing
material
on the
day of delivery
. Unpacking does not include putting
glasses and dishes on shelves or putting clothes in drawers.
Packing
material MUST be removed on the day of delivery. Extra pick-ups
for the removal of packing material are your
responsibility.
|
●
|
Storage
of your household goods for up to 60 days. Storage costs in
excess of 60 days will be billed directly to you upon
delivery. The cost to move the goods out of storage is paid by
the company providing it is within one year of your date of
hire. It is your responsibility to arrange for payment of
additional charges with the movers. Be sure to verify what
forms of payment are acceptable.
|
●
|
Normal
appliance service for washer, dryer, refrigerator, and freezer that were a
part of the move. New appliances delivered by a different
source are excluded.
|
●
|
Portable
spas will be moved as long as plumbing and wiring is disconnected prior to
the move. This is an employee responsibility. If a
crane is required to move the spa, you will be charged for this
service.
|
●
|
Automobiles--
interstate moves only
(over 750 miles). Value must exceed the cost of
shipment.
|
PACKING
|
●
|
Building
material: bricks, rocks, gravel, lumber, cement, etc.
|
●
|
Combustible
items: paint, lighter fluid, aerosols
|
●
|
Plants,
shrubs, trees, fertilizer, dirt
|
●
|
Perishable
foodstuffs and/or frozen foods
|
●
|
Pets
or animals of any kind
|
●
|
Boats,
boat trailers, recreational vehicles, trailers
|
●
|
Valuable
jewelry, precious stones, furs
|
●
|
Valuable
papers, securities, money
|
●
|
Ammunition
and/or explosives
|
●
|
Tractors
or farm implements other than those required for normal garden
use
|
●
|
Firewood,
coal
|
●
|
Articles
of inherent or extraordinary value
|
●
|
Farm
animals, horses, cattle, fowl, etc.
|
●
|
Items
from a temporary residence
|
●
|
Items
that cannot be attached a value (personal paintings, pottery,
etc.)
|
●
|
Auto
parts
|
●
|
Autos
that cannot be driven
|
●
|
Satellite
dishes
|
●
|
Wine
and wine cellar shipments
|
|
SERVICES
NOT AUTHORIZED
|
●
|
Storage
of automobiles
|
●
|
Weekend
or holiday moves, overtime
|
●
|
Extra
pick-up and/or delivery
|
●
|
Disassembly
and reassembly of playhouses, tool sheds, swimming pools/spas, TV
antennas, satellite dishes, workbenches, play equipment
|
●
|
Installation
of television antennas, tool sheds, play equipment,
etc.
|
●
|
Removal
of wall-to-wall carpeting and/or draperies
|
●
|
Providing
or moving electrical/gas outlets for appliances
|
●
|
Disconnecting/connecting
ice makers or portable spas
|
●
|
Venting
dryers
|
●
|
Reconnecting
water softeners
|
●
|
Draining
and refilling waterbeds
|
●
|
Moving
items from a temporary living location
|
●
|
Storage
of household goods, other than in-transit
|
●
|
Extra
pick-up for removal of packing material
|
●
|
House
cleaning
|
●
|
Exclusive
use of a van to expedite service
|
●
|
Crane
service for a spa
|
|
NOTE:Movers
will accept items such as televisions, stereos, personal computers,
recording equipment, and other similar items for
shipment. However, they will not accept liability for internal
damage to the equipment or appliances caused by moving, vibrations or
other normal handling. They will only accept liability for
damage when there is EXTERNAL VISUAL DAMAGE caused by maltreatment and the
condition of the item is noted at the time of
delivery.
|
|
All
claims for loss or damage to Household goods should be submitted directly
to
|
|
the
insurance company. Claims for damage to your home should be
submitted
|
|
directly
to the carrier.
|
ARTICLES
OF VALUE
|
HIGH
VALUE ARTICLES
|
IMPORTANT
HINTS
|
●
|
Be
certain your new residence can accommodate the furniture you are
moving. Measuring the rooms prior to moving can help you
determine whether or not all furniture should be
transported. If not, you may want to dispose of it at your old
location.
|
●
|
Be
certain the movers can contact you on the day of the move by providing
them with a cell phone number.
|
●
|
Keep
the telephone number of the movers handy on moving day. You may
need to contact them during the move or during
delivery.
|
●
|
Leave
a message telephone number with the movers. It may be necessary
to contact you during the move or prior to the delivery of
goods.
|
●
|
Notify
the driver or movers IMMEDIATELY of any damaged or missing items. to
report damage or missing items immediately may result in claims being
denied.
|
●
|
Be
cautious if you are moving to a lower cost area. What may
appear to be a bargain based on prices in your present location may be
overpriced in your new location. New hires have a reputation
for paying MORE for homes in their new location than someone who is
already living in the area and is more familiar with the
market. Look around enough to be able to judge local
values.
|
This
is where a PG&E approved real estate agent can be of
value.
|
|
●
|
When
looking at homes, keep your top two or three choices in
mind. In this way, when you begin negotiations on you first
choice, you will have more leverage if they know you also have one or two
more homes on which you are willing to make offers.
|
●
|
If
you are thinking about building a home in your new location, it may be
advisable to reconsider. You will be in a new job, which may
initially involve more time on the job and this, coupled with the demands
and stresses of new home construction, may be a large
burden.
|
●
|
You
should keep in mind that under current relocation policy investments in
most improvements, personal property, etc. will not be protected -
you will only be protected on the LESSER of the TRUE purchase price of the
home or the appraised value established by the lender at time of
purchase.
|
●
|
If
you anticipate being relocated again, you should strongly consider buying
the home you want rather than buying a lesser home and making major
improvements. ALWAYS THINK RESALE.
|
●
|
You
should ALWAYS make your offer to purchase contingent on
|
--
building inspections reports that are satisfactory, even
if you are
|
|
purchasing
a newly constructed home
|
|
--the
property appraising at purchase price or higher
|
|
--
obtaining
financing
|
●
|
Prelisting
Analysis and Strategy (Brokers Market Analysis) using an approved list of
realtors
|
●
|
Listing
Price Recommendation and Approval
|
●
|
The
Appraised Process
|
●
|
The
Amended Value Program
|
●
|
The
Appraised Value Program
|
●
|
Equity
Advances
|
●
|
Your
Consultant will contact you to provide an overview of the
program. This contact will occur within 48 hours of Relocation
Services notifying the home purchase firm of your
interest.
|
●
|
Your
consultant will provide you with a list of approved agents to select
from.
|
●
|
The
agents will complete the Prelisting Analysis and Marketing Strategy PRIOR
to listing your home. Spouse/Domestic Partners and family
members are ineligible to list an employee’s home. Two Broker’s
Market Analysis will be obtained.
|
●
|
Upon
review of this material with you, the home purchase firm will recommend an
initial list price.
|
●
|
Local
independent appraisers selected by you from an approved list will appraise
your home.
|
●
|
Upon
receipt of the Appraisal Value Offer, your list price must be within
current program guidelines.
|
●
|
Property
assessments (inspections) appropriate to the age and condition of your
home are required and will be ordered by the home purchase
firm.
|
●
|
The
home purchase firm will extend an Appraised Value Offer to purchase your
home. This offer is valid for 60 days.
|
●
|
You
may assign an offer or accept the Appraised Value Offer at any time during
the 60-day marketing period provided your home has been listed for at
least 45 days.
|
●
|
You
must present and review ALL offers with your Consultant even though they
may be less or seem less than the Appraised Value Offer. This
will assist you in determining which offer will net you the greatest
amount. The review will also confirm which closing costs are
reimbursable under the PG&E program.
|
●
|
Once
you assign an offer or accept the Appraised Value offer, you may receive
an advance on your equity before the close of escrow for use as an earnest
deposit/down payment on your new home. This advance is based on
the Appraised Value Offer, not the sales
price.
|
●
|
A
completed typical single -family dwelling or condominiums on a standard
size lot (less than
one
acre
). Unusual homes such as geodesic domes, earth
homes, log cabins, houseboats, A-frames, Victorians and other specialty
homes are excluded.
|
●
|
Homes
older than 40 years may be ineligible. Exceptions may be made
if the homeowner can provide a letter of code compliance (dated within the
last 5 years) from the appropriate governmental inspection
office.
|
●
|
Your
principal
residence and where you
currently
reside
|
●
|
Owned
only by you and/or your Spouse/Domestic Partner (an ex-Spouse/ Domestic
Partner or parent cannot be on the title)
|
●
|
Determined
to be marketable by PG&E
|
●
|
Mortgage
payments, Real Estate taxes, and Association dues must be
current.
|
●
|
Zoned
residential. Rural residential zoning or lots larger than
one acre
do not
qualify.
|
●
|
All
required building permits and private road maintenance agreements must be
recorded
|
It
is also important to note the following:
|
|
Your
Listing Agreement must include the "Exclusion Clause."
|
|
●
|
You
must list your home and actively market it for at least 45
days.
|
●
|
When
you request the home purchase firm's assistance, your home must be
available for sale. It cannot have been rented or leased within
the prior 12 months. It
cannot
be rented or
leased after you elect to participate.
All construction and/or repairs
must be completed prior to requesting the Home sale Assistance
Program
.
|
If
upon appraisal and subsequent inspection, it is determined that repairs
are required, you may either undertake and pay for those repairs OR allow
the home purchase firm to order repair work and deduct twice the cost
(except for termite work) from your final equity. Excess funds
withheld will be returned upon completion of the work.
|
|
Major
structural defects may affect the marketability of a home and may
disqualify a home from the Home Sale Assistance
Program.
|
●
|
Homes
containing UFFI, asbestos (interior or exterior), an unacceptable level of
radon gas, or any other toxic substance are ineligible.
|
●
|
Homes
with LP siding or synthetic stucco are ineligible.
|
●
|
Homes
with toxic mold.
|
●
|
Homes
containing a well must have water rights. In addition, the
water supply must be BOTH potable and ample under local
standards.
|
●
|
Farms,
places of business, cooperative apartments, mobile homes, duplexes,
vacation and income (rental) property are ineligible.
|
●
|
The
land on which the residence is located must constitute a lot of standard
size for the area and be zoned residential. Land not reasonably
necessary for the use and enjoyment of the property as a single-family
dwelling, such as additional lots or farm acreage, is
excluded.
|
●
|
Condominiums
must meet the following guidelines:
|
Your
are responsible for providing verification of the
above.
|
●
|
Other
factors which may affect the eligibility of a property for this program
include, but are not limited to, the
following:
|
|
--
Structural
problems/damage
|
|
--
Expansive
soil
|
|
--
Safety or code
violations
|
|
--
Unmarketable
title
|
|
--
Inability to meet conventional lender or insurance
requirements
|
|
--
Properties in
foreclosure
|
|
--
Bankruptcy
|
|
--Special
financing (e.g., first-time buyers)
|
|
If
your home is subject to any of the items listed above, inform Relocation
Services.
|
●
|
PG&E
RETAIN THE RIGHT TO MAKE THE FINAL DECISION ON THE ELIGIBILITY OF A HOME
FOR THE HOME SALE ASSISTANCE
PROGRAM.
|
PG&E
provides you with the following Home Sale Assistance
options:
|
●
|
Amended
Value
--
Sell your home to a buyer of your choice for a
price that is equal to or more than the Appraised Value Offer and assign
the offer to the home purchase firm who will coordinate the
closing. Program guidelines must be
followed.
|
●
|
Appraised
Value Offer
--
Amend the offer and sell your home to
the home purchase firm for the Appraised Value Offer.
|
●
|
Sell
your home without the assistance of the home purchase firm. You
will be reimbursed typical seller's Closing Costs. When
selecting this option, employees are encouraged to consider the tax
consequences associated with this
reimbursement.
|
Who
Are the Appraisers?
|
What
Is an Appraisal?
|
What
Is a Market Value?
|
How
Appraisers Estimate Value
|
GENERAL
DATA
|
●
|
Supply
and Demand
|
|
The
number of people buying homes and the number of homes on the market
affects property values. However, if a sellers' market or buyers' market
exists in a particular neighborhood, it does not necessarily follow that
the same condition is true elsewhere. In appraising your
property, the appraiser will consider local supply and
demand. How many homes are for sale in your immediate
neighborhood? How quickly are they being sold? What
are the conditions surrounding the
sale?
|
●
|
Location
|
|
The
general condition of homes in your immediate neighborhood and
accessibility to shopping, schools, and transportation are key
factors. Proximity to heavy traffic, commercial establishments
or industrial zones can adversely affect property
values.
|
●
|
Economic
Conditions
|
|
Economic
conditions vary from region to region. Strikes, plant closings,
foreclosures, and outgoing group moves can have a depressing impact on
property values. However, new plant openings, incoming group
moves, or locally awarded contracts can have an uplifting
effect.
|
●
|
Financing
Conditions
|
|
The
cost (interest rates, discount points, etc.) and availability of mortgage
financing both have substantial impact on housing prices. If
financing is costly or scarce, the market value of your home may be
favorably affected if it has a high balance assumable mortgage with a low
interest rate.
|
●
|
Political
Factors
|
|
State
and local governments can affect property values. school bonds,
zoning changes, property reassessment, new school appropriations, as well
as taxes and education, all impact housing
prices.
|
SPECIFIC
DATA
|
●
|
Condition
Viewed From Outside Your Home
|
Does
your property have "curb appeal"? On first seeing your home
from the street, what will a prospective buyer think? Does the
general condition of the home and lot contribute to the home's
attractiveness? Is there demand for your architectural
style? Is your home on a public or private
street? Is the street paved? Does it have a
sidewalk? Does your community have a public water supply, a
sewage system, or does it depend on a well or septic
system?
|
●
|
Condition
Viewed From Inside Your Home
|
|
On
entering your home, what will a prospective buyer think? This
is especially true in a Buyer’s market. Does the overall
condition reflect pride of ownership? Does the floor plan
afford a satisfactory flow of traffic? Is the closet space
adequate? Is the kitchen spacious and up-to-date? Is
the decor neutral or is it too personalized? The appraiser will
record number of rooms, bedrooms, baths, kitchen, dining room, family, or
similar rooms, and the dimensions of each. The appraiser will
closely observe quality of construction, floor coverings, paint,
wallpaper, age, type, and condition of kitchen appliances and anything
else that reflects the overall condition of your
home.
|
COMPARISON
WITH SIMILAR HOMES
|
Comparable
Sales
|
Comparable
Listings
|
●
|
Money
spent on repairs and maintenance is not normally recovered when a home is
sold. Deferred maintenance, however, can actually reduce
property value by the cost of needed repairs.
|
●
|
If
construction costs have risen, such an increase in value may be offset by
other factors such as aging, wear or deferred
maintenance.
|
●
|
There
is NO guarantee that a homeowner will make a profit when they sell their
home; the MARKETPLACE is what determines whether a profit will be
realized.
|
●
|
With
UNLIMITED TIME, a seller may be able to find a buyer willing to pay more
than the appraised value. A relocation appraisal ESTIMATES the
price which is most likely to be agreed upon by a typical buyer and seller
within a reasonable period of time (90 to 120 days).
|
●
|
The
improvements you make to your home may NOT be considered as desirable by
subsequent owners as they were by you. Improvements may not
increase the value of your property by as much as they
cost.
|
●
|
Improvements
or additions to a home do not necessarily increase value as much as their
costs because an improvement that appeals to one owner may not appeal to
all.
|
●
|
When
people have styled a home in a very personal way, they tend to place a
high value on it. It can be difficult to understand that this
personal touch does not necessarily translate into dollar value in the
marketplace.
|
●
|
Your
presence at the closing is not required since the home purchase firm will
close the sale on your behalf. You and your family are free to
move to your new location. You need only to sign the sellers'
closing instructions, the deed and other related
documents.
|
●
|
When
you assign an offer, you will not incur normal selling expenses and will
not, therefore, require reimbursement from
PG&E.
|
1.
|
Find
a buyer willing to purchase your home at a comparable or higher price than
Appraised Value Offer, and turn the sale over to the home purchase firm
for closing (Assigned Sale); or
|
2.
|
Accept
the Appraised Value Offer.
|
The
60-Day Market Period will not be extended for any
reason.
|
60 Day Vacate
Period
|
●
|
Unpaid
balance of principal and prorated interest on any mortgage(s) or equity
line(s) of credit
|
●
|
Proration
of real estate taxes
|
●
|
Unpaid
special assessments, homeowner association dues
|
●
|
Monetary
liens, judgments
|
●
|
Twice
the estimated cost of work/repairs (except for termite repairs) if the
work is not completed prior to your being cashed
out.
|
Please
note: Equity
advances are
made only to escrow
accounts
.
|
Carrying
Expenses
:
|
1.
|
Outstanding
encumbrances and/or indebtedness against the property and prorated
interest;
|
2.
|
Prorated
property taxes;
|
3.
|
If
the required work is not completed and re-inspected prior to your vacate
date, twice the amount of the estimate (except for termite repairs) with
be withheld to prevent any underpayment. Any excess
funds will be refunded upon completion of the work;
and
|
4.
|
Bonds
and assessments where included in the appraised value but
unpaid.
|
Call
your consultant whenever you have a
question.
|
Return
the following to the home purchase firm from the introductory
package.
|
--
|
Power
of Attorney
|
--
|
California
Real Estate Disclosure Statement
|
All
parties whose names appear on the Deed must sign this
form. The
Appraised
Value Offer cannot be released until these documents are received by the
home purchase firm.
|
Scheduling
Appraisers/Inspectors Visits
|
Payment
of Equity
|
Final
Walk through
|
Final
Utility Bills
|
Insurance
|
New
Mailing Address
|
Provide
your new mailing address AND telephone numbers to your
Consultant.
|
(
Ö
)
|
LIVING
ROOM
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
FIREPLACE/WOOD
STOVE
|
|||||
OTHER
|
|||||
(
Ö
)
|
DINING
ROOM
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
OTHER
|
|||||
(
Ö
)
|
KITCHEN
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
STOVE
TOP
|
|||||
OVEN(S)
|
|||||
HOOD/FAN
|
|||||
DISHWASHER
|
|||||
TRASH
COMPACTOR
|
|||||
COUNTERS
|
|||||
GARBAGE
DISPOSAL
|
|||||
REFRIGERATOR
|
|||||
OTHER
|
(
Ö
)
|
BEDROOM
1
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
OTHER
|
(
Ö
)
|
BEDROOM
2
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
OTHER
|
(
Ö
)
|
BEDROOM
3
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
OTHER
|
|||||
(
Ö
)
|
BATHROOM1
|
COMMENTS
|
BATHROOM
2
|
COMMENTS
|
|||
WALLS
|
|||||||
DOORS
|
|||||||
FLOOR/CARPET
|
|||||||
WINDOWS/SCREENS
|
|||||||
COVERINGS
|
|||||||
LIGHT
FIXTURES
|
|||||||
VENTILATING
FAN
|
|||||||
BASIN
|
|||||||
TOILET
|
|||||||
BATHTUB
|
|||||||
SHOWER
STALL
|
|||||||
SHOWER
DOOR
|
|||||||
OTHER
|
(
Ö
)
|
OTHER
|
COMMENTS
|
|||
WALLS
|
|||||
DOORS
|
|||||
FLOOR/CARPET
|
|||||
WINDOWS/SCREENS
|
|||||
COVERINGS
|
|||||
LIGHT
FIXTURES
|
|||||
OTHER
|
|
1.REIMBURSABLE
ITEMS*
|
|
Attorney
fees (in lieu of a title company)
|
|
Brokerage
fee/commission (normal for the area if a broker is
used)**
|
|
City
report
|
|
Escrow
fees
|
|
Home
warranty
|
|
Notary
fees
|
|
Prepayment
penalty on first mortgage***
|
|
Reconveyance
fees
|
|
Recording
fees
|
|
Statement
fees
|
|
Tax
stamps
|
|
Title
insurance
|
|
Transfer
tax (city and/or county)
|
|
2.NON-REIMBURSABLE
ITEMS
|
|
Any
items not specifically covered by policy or negotiated between buyer and
seller
|
|
Appraisal
fee
|
|
Assumption
fee
|
|
Bonds
|
|
Buy
downs
|
|
Credit
reports
|
|
Delinquent
taxes
|
|
Document
preparation fee
|
|
Endorsements
|
|
Fix-up
expenses and maintenance costs
|
|
Homeowner
Association dues or transfer fees
|
|
Impound
accounts
|
|
Insurance
|
|
Interest
|
|
Late
charges
|
|
Mortgage
insurance
|
|
Photos
|
|
Points
of all kinds
|
|
Prepayment
penalty on second mortgage
|
|
Principal
|
|
Reinspections
|
|
Repairs
|
|
2.NON-REIMBURSABLE
ITEMS - continued
|
|
Taxes
|
|
Termite
inspection
|
|
Termite/pest
control work
|
|
VA/FHA
points
|
|
*Consult
with Relocation Services for customary items in the county of the
sale.
|
|
**If
an employee, Spouse/Domestic Partner or family member is a REALTOR, it is
a conflict of interest for the company to reimburse members of a
relocating family for services (commission) connected with the sale of the
old home or purchase of a new home.
|
|
***Limited
to the lesser of six months interest or
$3,000.
|
|
1.REIMBURSABLE
ITEMS*
|
|
Appraisal
fees
|
|
Assumption
fee
|
|
Attorney
fees (in lieu of escrow fees, if typical for the
area)
|
|
City
report
|
|
Credit
report (Limited)
|
|
Documentation
preparation fees (Limited)
|
|
Endorsements
|
|
Escrow
fees
|
|
Flood
Certificate (Limited)
|
|
Forwarding
fees
|
|
General
Home Inspection
|
|
Home
warranty
|
|
Loan
tie-in fees**
|
|
Notary
fees
|
|
Points: Limited
to two. Based on (95% equity
reinvestment)
|
|
Pool/Spa
inspection
|
|
Recording
fees
|
|
Roof
inspection
|
|
Septic
report (only if required by lender)
|
|
Statement
fees
|
|
Tax
service (Limited)
|
|
Tax
stamps
|
|
Termite
inspection
|
|
Title
insurance
|
|
Transfer
tax (city and/or county)
|
|
2.NON-REIMBURSABLE
ITEMS
|
|
Any
items not specifically covered by policy or negotiated between buyer and
seller
|
|
Application
fee
|
|
Buy
downs
|
|
Construction
Loans*
|
|
Fix-up
expenses, repairs, maintenance
costs
|
|
Homeowner
Association dues/Association Transfer
fees
|
|
Impound
accounts
|
|
Insurance
|
|
Interest
|
|
Late
charges
|
|
2.NON-REIMBURSABLE
ITEMS - continued
|
|
Mortgage
insurance
|
|
Photos
|
|
Principal
|
|
Processing
Fee
|
|
Repairs
|
|
Soil
report
|
|
Taxes
|
|
Underwriting
fees
|
|
*Consult
with Relocation Services for customary items in the county of the
purchase.
|
|
**Consult
Relocation Services for current
guidelines.
|
|
*May
be required due to age or condition
|
|
**Final
walk through required for Appraised Value Sale
only
|
CAL VET/VA Loan Transfer
Q:
What if I have a CAL VET or VA
loan on my present home that I want to transfer to my new home, but I am
unable to make the transfer for six to eight months due to the
state/federal procedures?
A: The
home purchase firm will take your home into inventory while you continue
to make mortgage payments; however, if the home purchase firm is able to
find a buyer prior to the transfer of your CAL VET/VA loan, you would be
required to pay off the loan so that there is clear
title. (Notify the home purchase firm immediately if you plan
to transfer your loan.)
|
Amended
Value
|
|
TAX
SUMMARY FOR NEW HIRE HOMEOWNER –
OFFICER
|
ASSISTANCE
|
TAXES
WITHHELD
|
TAXES
PAID BY
|
Household
Move
Household
Storage
First
30 days
Over
30 days
|
None
None
Federal,
State, FICA & SDI
|
Fully
Excludable
Fully
Excludable
Company: Flat
Rate
Employee: FICA
(OASDI) & SDI
|
Moving
Allowance
|
Federal,
State, FICA & SDI
|
Employee*
|
Home
Sale-Direct Reimbursement
(
In lieu of Home
Purchase Firm)
Tax Offset
(up to one
month’s salary)**
|
Federal,
State, FICA & SDI
|
Employee*
|
Home
Purchase-Direct Reimbursement*
AND
Company Mortgage Program
|
Federal,
State, FICA & SDI
|
Company: Flat
rate up to maximum,
excluding
points.
Employee:
Points.
Federal, State, FICA & SDI
|
Mortgage
Interest Differential Allowance
|
Federal,
State, FICA & SDI
|
Employee
|
NOTE:
|
If
an item is considered taxable, but paid directly to a vendor, any tax due
will be deducted from the next payroll
check.
|
Reimbursable
Items:
|
Purchase
Price
:
|
$225,000.00
|
||
Points
|
$3,600.00
|
|||
Credit
Report
|
50.00
|
|||
Document
Preparation
|
150.00
|
2.5% of Purchase Price
=
|
$5,625.00
|
|
Appraisal
|
300.00
|
Home
Inspection
|
+ 425.00
|
|
General
Home Inspection
|
325.00
|
Total
Reimbursed
|
$6,050.00
|
|
Escrow
Fees
|
450.00
|
Points
-Employee Tax
Liability
|
-
3600.00
|
|
Title
Insurance
|
985.00
|
|||
Termite
Inspection
|
95.00
|
|||
Notary
Fees
|
25.00
|
Relocation
Tax Liability
|
$2,450.00
|
|
Recording
Fees
|
35.00
|
|||
Tax
Service
|
76.00
|
|||
Flood
Check Fee
|
20.00
|
|||
Home
Inspection
|
425.00
|
(Not
Subject to the 2.5%cap)
|
||
TOTAL
|
$6,536.00
|
Total
Amount Reimbursed:
|
$6,050.00
|
Amount
Company Paid Tax On:
|
$2,45000
|
|||||||||
Gross
Up:(FIT, SIT & Medicare)
|
1,363.23
|
Co.
Paid Gross Up: (FIT, SIT & Medicare)
|
1,363.23
|
|||||||||
Amount
Employee Pays Tax On:
|
3,600.00
|
|||||||||||
Amount
Reported:
|
$7,413.23
|
Amount
Reported:
|
$7,413.23
|
|||||||||
Employee
|
||||||||||||
Total
Taxes
|
Tax
Paid by PG&E
|
Tax
Liability
|
||||||||||
“Points”
|
||||||||||||
Amount
Taxes were based on:
|
$2,450.00
|
$3,600.00
|
||||||||||
FIT*
|
25.00%
|
$1,853.31
|
$953.31
|
$900.00
|
||||||||
SIT*
|
9.3%
|
570.63
|
354.63
|
216.00
|
||||||||
Medicare*
|
1.45%
|
107.49
|
55.29
|
52.20
|
||||||||
OASDI
|
6.20%
|
459.62
|
459.62
|
|||||||||
SDI
|
1.10%
|
81.55
|
59.31
|
|||||||||
*TOTAL
|
64.25%
|
$3,072.60
|
$1,363.23
|
$1,709.37
|
||||||||
AMOUNT
TO BE WITHHELD:
|
1,709.37
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources | ||
Date: December 30, 2008 |
December 15,
2004
|
Board
adopts Plan with a reserve of 12 million shares.
|
April
20, 2005
|
Shareholders
approve Plan.
|
January
1, 2006
|
Plan
Effective Date
|
February
15, 2006
|
Change
in control provisions are amended
|
December
20, 2006
|
Board
amends Section 7 containing the terms for automatic awards for
Non-Employee Directors, effective January 1, 2007
|
October
17, 2007
|
Board
amends Section 7 as follows:
Define
“Grant Date” for a particular calendar year as the first business day in
March of that calendar year. Previously, the grant date for
awards in 2006 and 2007 was the first business day in January of that
particular calendar year. This amendment becomes effective
starting with grants for 2008.
Amend
the basis for calculating the per share value of stock option awards, so
it is based on the average closing price of Stock during the months of
November, December, and January preceding the
grant. Previously, the per share value of stock options awards
for grants in 2006 and 2007 was based on the average closing price of
Stock during the preceding month of November. This amendment
becomes effective starting with grants for 2008.
Clarify
the language for settling restricted stock awards upon a Nonemployee
Director’s retirement from the Board, to indicate that shares credited to
a Nonemployee Director’s Restricted Stock Unit account may be settled
after a Nonemployee Director ceases to be a member of the Board of
Directors following five years of service on the Board.
|
September
17, 2008
|
Board
amends Section 7 containing the terms for automatic awards for Nonemployee
Directors, effective January 1, 2009, to increase the total value of
annual equity awards to Nonemployee Directors from $80,000 to
$90,000. Of this amount, $45,000 of equity awards shall be
Restricted Stock, and the remaining $45,000 shall be a mixture of Options
and Restricted Stock Units, consistent with the Plan and with each
Nonemployee Director’s election.
|
Effective
January 1, 2009
|
Plan
is amended to comply with the final regulations under Section 409A of the
Code
|
February
18, 2009
|
Plan
is amended to delay grant and pricing of 2009 grants for non-employee
directors, to be consistent with 2009 grants to
employees.
|
TABLE OF CONTENTS | |||
1.
|
Establishment,
Purpose and Term of Plan
|
1
|
|
1.1
|
Establishment
|
1
|
|
1.2
|
Purpose
|
1
|
|
1.3
|
Term
of Plan
|
1
|
|
2.
|
Definitions
and Construction
|
1
|
|
2..1
|
Definitions
|
1
|
|
2.2
|
Construction |
7
|
|
3.
|
Administration
|
7
|
|
3.1
|
Administration
by the Committee
|
7
|
|
3.2
|
Authority
of Officers
|
8
|
|
3.3
|
Administration
with Respect to Insiders
|
8
|
|
3.4
|
Committee
Complying with Section 162(m)
|
8
|
|
3.5
|
Powers
of the Committee
|
8
|
|
3.6
|
Option
or SAR Repricing
|
9
|
|
3.7
|
Indemnification
|
10
|
|
4.
|
Shares
Subject to Plan
|
10
|
|
4.1
|
Maximum
Number of Shares Issuable
|
10
|
|
4.2
|
Adjustments
for Changes in Capital Structure
|
10
|
|
5.
|
Eligibility
and Award Limitations
|
11
|
|
5.1
|
Persons
Eligible for Awards
|
11
|
|
5.2
|
Participation
|
11
|
|
5.3
|
Incentive
Stock Option Limitations
|
11
|
|
5.4
|
Award
Limits
|
12
|
|
6.
|
Terms
and Conditions of Options
|
13
|
|
6.1
|
Exercise
Price
|
13
|
|
6.2
|
Exercisability
and Term of Options
|
13
|
|
6.3
|
Payment
of Exercise Price
|
14
|
|
6.4
|
Effect
of Termination of Service
|
14
|
|
6.5
|
Transferability
of Options
|
15
|
|
7.
|
Terms
and Conditions of Nonemployee Director Awards
|
15
|
|
7.1
|
Automatic
Grant of Restricted Stock
|
15
|
|
7.2
|
Annual
Election to Receive Nonstatutory Stock Option and Restricted Stock
Units
|
15
|
|
7.3
|
Grant
of Nonstatutory Stock Option
|
16
|
7.4
|
Grant
of Restricted Stock Unit
|
16
|
|
7.5
|
Effect
of Termination of Service as a Nonemployee Director
|
18
|
|
7.6
|
Effect
of Change in Control on Nonemployee Director Awards
|
19
|
|
7.7
|
Right
to Decline Nonemployee Director Awards
|
19
|
|
8.
|
Terms
and Conditions of Stock Appreciation Rights
|
19
|
|
8.1
|
Types
of SARs Authorized
|
20
|
|
8.2
|
Exercise
Price
|
20
|
|
8.3
|
Exercisability
and Term of SARs
|
20
|
|
8.4
|
Deemed
Exercise of SARs
|
20
|
|
8.5
|
Effect
of Termination of Service
|
20
|
|
8.6
|
Nontransferability
of SARs
|
20
|
|
9.
|
Terms
and Conditions of Restricted Stock Awards
|
21
|
|
9.1
|
Types
of Restricted Stock Awards Authorized
|
21
|
|
9.2
|
Purchase
Price
|
21
|
|
9.3
|
Purchase
Period
|
21
|
|
9.4
|
Vesting
and Restrictions on Transfer
|
21
|
|
9.5
|
Voting
Rights, Dividends and Distributions
|
21
|
|
9.6
|
Effect
of Termination of Service
|
22
|
|
9.7
|
Nontransferability
of Restricted Stock Award Rights
|
22
|
|
10.
|
Terms
and Conditions of Performance Awards
|
22
|
|
10.1
|
Types
of Performance Awards Authorized
|
22
|
|
10.2
|
Initial
Value of Performance Shares and Performance Units
|
22
|
|
10.3
|
Establishment
of Performance Period, Performance Goals and Performance Award
Formula
|
23
|
|
10.4
|
Measurement
of Performance Goals
|
23
|
|
10.5
|
Settlement
of Performance Awards
|
24
|
|
10.6
|
Voting
Rights, Dividend Equivalent Rights and Distributions
|
24
|
|
10.7
|
Effect
of Termination of Service
|
25
|
|
10.8
|
Nontransferability
of Performance Awards
|
25
|
|
11.
|
Terms
and Conditions of Restricted Stock Unit Awards
|
26
|
|
11.1
|
Grant
of Restricted Stock Unit Awards
|
26
|
|
11.2
|
Vesting
|
26
|
|
11.3
|
Voting
Rights, Dividend Equivalent Rights and Distributions
|
26
|
|
11.4
|
Effect
of Termination of Service
|
27
|
|
11.5
|
Settlement
of Restricted Stock Unit Awards
|
27
|
|
11.6
|
Nontransferability
of Restricted Stock Unit Awards
|
27
|
12.
|
Deferred
Compensation Awards
|
27
|
|
12.1
|
Establishment
of Deferred Compensation Award Programs
|
27
|
|
12.2
|
Terms
and Conditions of Deferred Compensation Awards
|
28
|
|
13.
|
Other
Stock-Based Awards
|
29
|
|
14.
|
Change
in Control
|
29
|
|
14.1
|
Effect
of Change in Control on Options and SARs
|
29
|
|
14.2
|
Effect
of Change in Control on Restricted Stock and Other Awards
|
29
|
|
14.3
|
Nonemployee
Director Awards
|
29
|
|
15.
|
Compliance
with Securities Law
|
30
|
|
16.
|
Tax
Withholding
|
30
|
|
16.1
|
Tax
Withholding in General
|
30
|
|
16.2
|
Withholding
in Shares
|
30
|
|
17.
|
Amendment
or Termination of Plan
|
30
|
|
18.
|
Miscellaneous
Provisions
|
31
|
|
18.1
|
Repurchase
Rights
|
31
|
|
18.2
|
Provision
of Information
|
31
|
|
18.3
|
Rights
as Employee, Consultant or Director
|
31
|
|
18.4
|
Rights
as a Shareholder
|
31
|
|
18.5
|
Fractional
Shares
|
31
|
|
18.6
|
Severability
|
31
|
|
18.7
|
Beneficiary
Designation
|
32
|
|
18.8
|
Unfunded
Obligation
|
32
|
|
18.9
|
Choice
of Law
|
32
|
|
18.10
|
Section
409A of the Code
|
32
|
|
DATE
OF GRANT
|
NUMBER
OF SHARES GRANTED
|
NUMBER
OF UNVESTED SHARES AS OF 11/1/08
|
Release
of Shares and Withholding Taxes
|
When
the restrictions as to your shares of Restricted Stock lapse, the vested
shares shall be delivered to you, within thirty (30) days of the
applicable vesting date. You must elect one of the following methods to
satisfy applicable withholding and other taxes before the vested shares
will be delivered to you:
·
Pay the
amount due by cash or check,
·
Surrender to PG&E Corporation a number of vested shares having
an aggregate value (based on the closing price of PG&E Corporation
common stock on the New York Stock Exchange on the date of surrender)
equal to the amount due.
·
Sell
your vested shares and use a portion of the sales proceeds to pay the
amount due.
You
must sign the attached election form indicating which method you elect and
return the signed form to the Senior Manager of Executive Compensation,
Human Resources by December 1, 2008.
|
Name
of Award Recipient
|
DATE
OF GRANT
|
NUMBER
OF SHARES GRANTED
|
NUMBER
OF UNVESTED SHARES AS OF 11/1/08
|
January
3, 2005
|
||
January
3, 2006
|
[xx,xxx]
|
|
January
3, 2007
|
[xx,xxx]
|
|
[Others?]
|
·
|
□
Pay the amount due
by cash or check.
|
·
|
□
Surrender to
PG&E Corporation a number of vested Shares having an aggregate value
(based
on the closing price of PG&E Corporation common stock on the New York
Stock Exchange on the date of surrender) equal to the amount
due.
|
·
|
□
Sell
the vested Shares and use a portion of the sales proceeds to pay the
amount due.
(You
cannot make this election if you have previously entered into a Rule
10b5-1 sales plan that covers the vested
Shares.)
|
The
LTIP and Other Agreements
|
This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Performance Shares, subject to the terms of the
LTIP. Any prior agreements, commitments or negotiations are
superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern.
For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
|
Grant
of
Performance
Shares
|
PG&E
Corporation grants you the number of Performance Shares shown on the cover
sheet of this Agreement. The Performance Shares are subject to
the terms and conditions of this Agreement and the LTIP.
|
Vesting
of Performance Shares
|
As
long as you remain employed with PG&E Corporation, the Performance
Shares will vest on the first business day of January (the “Vesting Date”)
of the third year following the date of grant specified in the cover
sheet. Except as described below, all Performance Shares
subject to this Agreement that have not vested shall be forfeited upon
termination of your employment.
|
Payment
of Performance Shares
|
Upon
the Vesting Date, PG&E Corporation’s total shareholder return (TSR)
will be compared to the TSR of the twelve other companies in PG&E
Corporation’s comparator group
1
for the prior three calendar years (the
“Performance Period”). Subject to rounding considerations,
there will be no payout for TSR below the 25
th
percentile of the comparator group; TSR at the 25
th
percentile will result in a 25% payout of Performance Shares; TSR at the
75
th
percentile will result in a 100% payout of Performance Shares; and TSR at
the 90
th
percentile or greater will result in a 200% payout of Performance
Shares. The following table sets forth the payout percentages
for the various TSR rankings that could be achieved:
Number
of Companies in
Total
(Including
PG&E)
13
Performance Rounded
Rank Percentile Payout
1 100% 200%
2 92% 170%
3 83% 130%
4 75% 100%
5 67%
90%
6 58% 75%
7 50% 65%
8 42% 50%
9 33% 35%
10 25% 25%
11 17%
0%
12
8% 0%
13
0% 0%
The
payment will equal the product of the number of vested Performance Shares,
the applicable payout percentage, and the average closing price of a share
of PG&E Corporation common stock for the last 30 calendar days of the
year preceding the Vesting Date as reported on the New York Stock
Exchange. Payments will be made as soon as practicable
following the Vesting Date, but in event within sixty (60) days of the
Vesting Date.
|
Dividends
|
Each
time that PG&E Corporation declares a dividend on its shares of common
stock, an amount equal to the dividend multiplied by the number of
Performance Shares granted to you by this Agreement shall be accrued on
your behalf. If you receive a Performance Share payout in
accordance with the preceeding paragraph, at that same time you also shall
receive a cash payment equal to the amount of any dividends accrued over
the Performance Period multiplied by the same payout percentage used to
determine the amount of the Performance Share payout.
|
Voluntary
Termination
|
If
you terminate your employment with PG&E Corporation voluntarily before
the Vesting Date, all of the Performance Shares shall be cancelled as of
the date of such termination and any dividends accrued with respect to
your Performance Shares shall be
forfeited.
|
Termination
for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all of the Performance
Shares shall be cancelled as of the date of such termination and any
dividends accrued with respect to your Performance Shares shall be
forfeited. In general, termination for “cause” means
termination of employment because of dishonesty, a criminal offense or
violation of a work rule, and will be determined by and in the sole
discretion of PG&E Corporation.
|
Termination
other than for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, your unvested
Performance Shares will vest proportionally based on the number of months
during the Performance Period that you were employed (rounded down)
divided by the number of months in the Performance Period (36
months). All other outstanding Performance Shares (and any
associated accrued dividends) shall automatically be cancelled upon such
termination. Your vested Performance Shares will be payable, if
at all, after the Vesting Date and in any event within sixty (60) days of
the Vesting Date based on the same formula applied to active
employees. At that same time you also shall receive a cash
payment, if any, equal to the amount of dividends accrued over the
Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Retirement
|
If
you retire before the Vesting Date, your outstanding Performance Shares
will continue to vest as though your employment had continued and will be
payable, if at all, as soon as practicable following the Vesting Date, but
in any event within sixty (60) days of the Vesting Date. At
that time you also shall receive a cash payment, if any, equal to the
amount of dividends accrued over the Performance Period with respect to
your Performance Shares multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout. You will be considered to have retired if you are age
55 or older on the date of termination and if you were employed by
PG&E Corporation for at least five consecutive years ending on the
date of termination of your employment.
|
Death/Disability
|
If
your employment terminates due to your death or disability before the
Vesting Date, all of your Performance Shares shall immediately vest and
will be payable, if at all, as soon as practicable after the Vesting Date
and in any event within sixty (60) days of the Vesting Date based on the
same formula applied to active employees. At that time you also
shall receive a cash payment, if any, equal to the amount of dividends
accrued over the Performance Period with respect to your Performance
Shares multiplied by the same payout percentage used to determine the
amount, if any, of the Performance Share payout.
|
Termination
Due to Disposition of Subsidiary
|
If
(1) your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Code or (2) if your employment is
terminated (other than for cause or your voluntary termination) coincident
with the sale of all or substantially all of the assets of a subsidiary of
PG&E Corporation, all Performance Shares shall vest proportionally
based on the number of months during the Performance Period that you were
employed (rounded down) divided by the number of months in the Performance
Period (36 months). All other outstanding Performance Shares
(and any associated accrued dividends) shall automatically be cancelled
upon such termination. Your vested Performance Shares will be
payable, if at all, after the Vesting Date and in any event within sixty
(60) days of the Vesting Date based on the same formula applied
to active employees. At that time you also shall receive a cash
payment, if any, equal to the amount of dividends accrued over the
Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Withholding
Taxes
|
PG&E
Corporation will withhold amounts necessary to satisfy applicable taxes
from the payment to be made with respect to your Performance
Shares. You will receive the remaining proceeds in
cash.
|
Change
in Control
|
All
of your outstanding Performance Shares shall automatically vest, and
become nonforfeitable if there is a Change in Control of PG&E
Corporation before the Vesting Date. Such vested Performance
Shares will become payable on the first business day of the year following
such Change in Control if such Change in Control results in a change in
the ownership of effective control of PG&E Corporation, or a change in
a substantial portion of the assets of PG&E Corporation within the
meaning of Code Section 409A(a)(2)(A)(v) and the related regulations (a
“409A Change in Control Event”). If the change in control does
not result in a 409A Change in Control Event, then payment shall be made
as soon as practicable following the Vesting Date and in any event within
sixty (60) days of the Vesting Date. The payment, if any, will
be based on PG&E Corporation’s TSR for the period from the date of
grant to the date of the Change in Control compared to the TSR of the
other companies in PG&E Corporation’s comparator group
2
for the same period. The
payment will be calculated by multiplying the number of vested Performance
Shares by the payout percentage. The resulting number of
Performance Shares will be multiplied by the average closing price of a
share of PG&E Corporation common stock for the last 30 calendar days
preceding the Change in Control as reported on the New York Stock
Exchange. At the same time, you shall also receive a cash
payment, if any, equal to the amount of dividends accrued with respect to
your Performance Shares to the first business day of the year following
the Change in Control multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout.
|
Leaves
of Absence
|
For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation (or any of its subsidiaries) sponsored disability benefits,
you will be considered to have voluntarily terminated your
employment. See above under “Voluntary
Termination.”
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
|
No
Retention Rights
|
This
Agreement is not an employment agreement and does not give yo
u
the right to be retained by PG&E Corporation. Except as
otherwise provided in an applicable employment agreement, PG&E
Corporation reserves the right to terminate your employment at any time
and for any reason.
|
Applicable
Law
|
This
Agreement will be interpreted and enforced under the laws of the State of
California.
|
The
LTIP and Other Agreements
|
This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Performance Shares, subject to the terms of the
LTIP. Any prior agreements, commitments or negotiations are
superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern. Capitalized terms that are not defined in this Agreement are
defined in the LTIP.
For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
|
Grant
of
Performance
Shares
|
PG&E
Corporation grants you the number of Performance Shares shown on the cover
sheet of this Agreement. The Performance Shares are subject to
the terms and conditions of this Agreement and the LTIP.
|
Vesting
of Performance Shares
|
As
long as you remain employed with PG&E Corporation, the Performance
Shares will vest on the first business day of January (the “Vesting Date”)
of the third year following the date of grant specified in the cover
sheet. Except as described below, all Performance Shares
subject to this Agreement that have not vested shall be forfeited upon
termination of your employment.
|
Payment
of Performance Shares
|
Upon
the Vesting Date, PG&E Corporation’s total shareholder return (TSR)
will be compared to the TSR of the twelve other companies in PG&E
Corporation’s comparator group
1
for the prior three calendar years (the “Performance
Period”). Subject to rounding considerations, there will be no
payout for TSR below the 25
th
percentile of the comparator group; TSR at the 25
th
percentile will result in a 25% payout of Performance Shares; TSR at the
75
th
percentile will result in a 100% payout of Performance Shares; and TSR in
the top rank will result in a 200% payout of Performance
Shares. The following table sets forth the payout percentages
for the various TSR rankings that could be achieved:
Number
of Companies in
Total
(Including
PG&E)
13
Performance Rounded
Rank Percentile Payout
1 100% 200%
2 92% 170%
3 83% 130%
4 75% 100%
5 67%
90%
6 58% 75%
7 50% 65%
8 42% 50%
9 33% 35%
10 25% 25%
11 17%
0%
12 8%
0%
13 0% 0%
The
payment will equal the product of the number of vested Performance Shares,
the applicable payout percentage, and the average closing price of a share
of PG&E Corporation common stock for the last 30 calendar days of the
year preceding the Vesting Date as reported on the New York Stock
Exchange. Payments, if any, will be made as soon as practicable
after the Vesting Date following the date that the Compensation Committee
of the PG&E Corporation Board of Directors certifies the TSR
percentile rank over the Performance Period pursuant to Section 10.5(a) of
the LTIP, but in any event within sixty (60) days after the Vesting
Date.
|
Dividends
|
Each
time that PG&E Corporation declares a dividend on its shares of common
stock, an amount equal to the dividend multiplied by the number of
Performance Shares granted to you by this Agreement shall be accrued on
your behalf. If you receive a Performance Share payout in
accordance with the preceding paragraph, at that same time you also shall
receive a cash payment equal to the amount of any dividends accrued over
the Performance Period multiplied by the same payout percentage used to
determine the amount of the Performance Share payout.
|
Voluntary
Termination
|
If
you terminate your employment with PG&E Corporation voluntarily before
the Vesting Date, all of the Performance Shares shall be cancelled as of
the date of such termination and any dividends accrued with respect to
your Performance Shares shall be forfeited.
|
Termination
for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all of the Performance
Shares shall be cancelled as of the date of such termination and any
dividends accrued with respect to your Performance Shares shall be
forfeited. In general, termination for “cause” means
termination of employment because of dishonesty, a criminal offense or
violation of a work rule, and will be determined by and in the sole
discretion of PG&E Corporation.
|
Termination
other than for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, your unvested
Performance Shares will vest proportionally based on the number of months
during the Performance Period that you were employed (rounded down)
divided by the number of months in the Performance Period (36
months). All other outstanding Performance Shares (and any
associated accrued dividends) shall automatically be cancelled upon such
termination. Your vested Performance Shares will be payable, if
at all, after the Vesting Date and in any event within sixty (60) days of
the Vesting Date based on the same formula applied to active
employees. At that same time you also shall receive a cash
payment, if any, equal to the amount of dividends accrued over the
Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Retirement
|
If
you retire before the Vesting Date, your outstanding Performance Shares
will continue to vest as though your employment had continued and will be
payable, if at all, as soon as practicable following the Vesting Date, but
in any event within sixty (60) days of the Vesting Date. At
that same time you also shall receive a cash payment, if any, equal to the
amount of dividends accrued over the Performance Period with respect to
your Performance Shares multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout. You will be considered to have retired if you are age
55 or older on the date of termination and if you were employed by
PG&E Corporation for at least five consecutive years ending on the
date of termination of your employment.
|
Death/Disability
|
If
your employment terminates due to your death or disability before the
Vesting Date, all of your Performance Shares shall immediately vest and
will be payable, if at all, as soon as practicable after the Vesting Date
and in any event within sixty (60) days of the Vesting Date based on the
same formula applied to active employees. At that same time you
also shall receive a cash payment, if any, equal to the amount of
dividends accrued over the Performance Period with respect to your
Performance Shares multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout.
|
Termination
Due to Disposition of Subsidiary
|
(1)
If your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Internal Revenue Code of 1986, as
amended, or (2) if your employment is terminated (other than for cause or
your voluntary termination) coincident with the sale of all or
substantially all of the assets of a subsidiary of PG&E Corporation,
all Performance Shares shall vest proportionally based on the number of
months during the Performance Period that you were employed (rounded down)
divided by the number of months in the Performance Period (36
months). All other outstanding Performance Shares (and any
associated accrued dividends) shall automatically be cancelled upon such
termination. Your vested Performance Shares will be payable, if
at all, after the Vesting Date and in any event within sixty (60) days of
the Vesting Date based on the same formula applied to active
employees. At that same time you also shall receive a cash
payment, if any, equal to the amount of dividends accrued over the
Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Change
in Control
|
In
the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or other business entity or parent thereof, as the
case may be (the “Acquiror
”
), may, without your
consent, either assume or continue PG&E Corporation’s rights and
obligations under this Agreement or provide a substantially equivalent
award in substitution for the Performance Shares subject to this
Agreement. If the Acquiror assumes or continues PG&E
Corporation’s rights and obligations under this Agreement or substitutes a
substantially equivalent award, TSR shall be calculated by aggregating (a)
the TSR of PG&E Corporation for the period from January 1 of the year
of grant to the date of the Change in Control, and (b) the TSR of the
Acquiror from the date of the Change in Control to the Vesting
Date. The payout percentage reflected in the table set
forth above for the highest percentile TSR performance met or exceeded
when calculated on that basis, and considering any adjustments to the
comparator group, will be used to determine the amount of the payout, if
any, upon settlement of the assumed, continued or substituted award which
settlement shall occur as soon as practicable after the Vesting Date and
in any event within sixty (60) days of the Vesting Date. At
that same time you also shall receive a cash payment, if any, equal to the
amount of dividends accrued with respect to your Performance Shares to the
first business day of the year following the Change in Control multiplied
by the same payout percentage used to determine the amount, if any, of the
Performance Share payout.
If
this Award is neither assumed nor continued by the Acquiror or if the
Acquiror does not provide a substantially equivalent award in substitution
for the Performance Shares subject to this Agreement, all of your
outstanding Performance Shares shall automatically vest and become
nonforfeitable when the Change in Control of PG&E Corporation occurs
before the Vesting Date. Such vested Performance Shares will
become payable as soon as practicable following the original Vesting Date
and in any event within sixty (60) days of the original Vesting
Date. The payment, if any, will be based on PG&E
Corporation’s TSR for the period from January 1 of the year of grant to
the date of the Change in Control compared to the TSR of the other
companies in PG&E Corporation’s comparator group
2
for the same period. The payment will be calculated by
multiplying the number of vested Performance Shares by the payout
percentage. The resulting number of Performance Shares will be
multiplied by the average closing price of a share of PG&E Corporation
common stock for the last 30 calendar days preceding the Change in Control
as reported on the New York Stock Exchange. At that same time
you also shall receive a cash payment, if any, equal to the amount of
dividends accrued with respect to your Performance Shares to the first
business day of the year following the Change in Control multiplied by the
same payout percentage used to determine the amount, if any, of the
Performance Share payout.
|
Termination
In Connection with a Change in Control
|
If
your employment is terminated in connection with a Change in Control
within three months before the Change in Control occurs or within two
years following the Change in Control, all of your outstanding Performance
Shares (to the extent they did not previously vest upon failure of the
Acquiror to assume or continue this Award) shall automatically vest and
become nonforfeitable on the date of termination of your employment. Your
vested Performance Shares will be payable, if at all, as soon as
practicable following the original Vesting Date and in any event within
sixty (60) days of the Vesting Date and will be based on the same formula
applied to active employees. You shall also at that time
receive a cash payment, if any, equal to the amount of dividends accrued
over the Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
PG&E
Corporation shall have the sole discretion to determine whether
termination of your employment was made in connection with a Change in
Control.
|
Withholding
Taxes
|
PG&E
Corporation will withhold amounts necessary to satisfy applicable taxes
from the payment to be made with respect to your Performance
Shares. You will receive the remaining proceeds in
cash.
|
Leaves
of Absence
|
For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation sponsored disability benefits, you will be considered to have
voluntarily terminated your employment. See above under
“Voluntary Termination.”
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
|
No
Retention Rights
|
This
Agreement is not an employment agreement and does not give you the right
to be retained by PG&E Corporation. Except as otherwise
provided in an applicable employment agreement, PG&E Corporation
reserves the right to terminate your employment at any time and for any
reason.
|
Applicable
Law
|
This
Agreement will be interpreted and enforced under the laws of the State of
California.
|
The
LTIP and Other Agreements
|
This
Agreement constitutes the entire understanding between you and PG&E
Corporation regarding the Performance Shares, subject to the terms of the
LTIP. Any prior agreements, commitments or negotiations are
superseded. In the event of any conflict or inconsistency
between the provisions of this Agreement and the LTIP, the LTIP shall
govern. Capitalized terms that are not defined in this Agreement are
defined in the LTIP.
For
purposes of this Agreement, employment with PG&E Corporation shall
mean employment with any member of the Participating Company
Group.
|
Grant
of
Performance
Shares
|
PG&E
Corporation grants you the number of Performance Shares shown on the cover
sheet of this Agreement. The Performance Shares are subject to
the terms and conditions of this Agreement and the LTIP.
|
Vesting
of Performance Shares
|
As
long as you remain employed with PG&E Corporation, the Performance
Shares will vest on the first business day of March (the “Vesting Date”)
of the third year following the date of grant specified in the cover
sheet. Except as described below, all Performance Shares
subject to this Agreement that have not vested shall be forfeited upon
termination of your employment.
|
Payment
of Performance Shares
|
Upon
the Vesting Date, PG&E Corporation’s total shareholder return (TSR)
will be compared to the TSR of the twelve other companies in PG&E
Corporation’s comparator group
1
for the prior three calendar years (the
“Performance Period”). Subject to rounding considerations,
there will be no payout for TSR below the 25
th
percentile of the comparator group; TSR at the 25
th
percentile will result in a 25% payout of Performance Shares; TSR at the
75
th
percentile will result in a 100% payout of Performance Shares; and TSR in
the top rank will result in a 200% payout of Performance
Shares. The following table sets forth the payout percentages
for the various TSR rankings that could be achieved:
Number
of Companies in
Total
(Including
PG&E)
13
Performance Rounded
Rank Percentile Payout
1 100% 200%
2 92% 170%
3 83% 130%
4 75% 100%
5 67% 90%
6 58% 75%
7 50% 65%
8 42% 50%
9 33% 35%
10 25% 25%
11 17%
0%
12 8%
0%
13 0% 0%
The
payment will equal the product of the number of vested Performance Shares,
the applicable payout percentage, and the average closing price of a share
of PG&E Corporation common stock for the last 30 calendar days of the
year preceding the Vesting Date as reported on the New York Stock
Exchange. Payments, if any, will be made as soon as practicable
after the Vesting Date following the date that the Compensation Committee
of the PG&E Corporation Board of Directors certifies the TSR
percentile rank over the Performance Period pursuant to Section 10.5(a) of
the LTIP, but in any event within sixty (60) days of the Vesting
Date.
|
Dividends
|
Each
time that PG&E Corporation declares a dividend on its shares of common
stock, an amount equal to the dividend multiplied by the number of
Performance Shares granted to you by this Agreement shall be accrued on
your behalf. If you receive a Performance Share payout in
accordance with the preceding paragraph, at that same time you also shall
receive a cash payment equal to the amount of any dividends accrued over
the Performance Period multiplied by the same payout percentage used to
determine the amount of the Performance Share payout.
|
Voluntary
Termination
|
If
you terminate your employment with PG&E Corporation voluntarily before
the Vesting Date, all of the Performance Shares shall be cancelled as of
the date of such termination and any dividends accrued with respect to
your Performance Shares shall be forfeited.
|
Termination
for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation for cause before the Vesting Date, all of the Performance
Shares shall be cancelled as of the date of such termination and any
dividends accrued with respect to your Performance Shares shall be
forfeited. In general, termination for “cause” means
termination of employment because of dishonesty, a criminal offense or
violation of a work rule, and will be determined by and in the sole
discretion of PG&E Corporation.
|
Termination
other than for Cause
|
If
your employment with PG&E Corporation is terminated by PG&E
Corporation other than for cause before the Vesting Date, your unvested
Performance Shares will vest proportionally based on the number of months
during the Performance Period that you were employed (rounded down)
divided by the number of months in the Performance Period (36
months). All other outstanding Performance Shares (and any
associated accrued dividends) shall automatically be cancelled upon such
termination. Your vested Performance Shares will be payable, if
at all, as soon as practicable after the Vesting Date based on the same
formula applied to active employees and in any event within sixty (60)
days of the Vesting Date. At that time you also shall receive a
cash payment, if any, equal to the amount of dividends accrued over the
Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Retirement
|
If
you retire before the Vesting Date, your outstanding Performance Shares
will continue to vest as though your employment had continued and will be
payable, if at all, as soon as practicable following the Vesting Date and
in any event within sixty (60) days of the Vesting Date. At the
same time you also shall also receive a cash payment, if any, equal to the
amount of dividends accrued over the Performance Period with respect to
your Performance Shares multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout. You will be considered to have retired if you are age
55 or older on the date of termination and if you were employed by
PG&E Corporation for at least five consecutive years ending on the
date of termination of your employment.
|
Death/Disability
|
If
your employment terminates due to your death or disability before the
Vesting Date, all of your Performance Shares shall immediately vest and
will be payable, if at all, as soon as practicable after the Vesting Date
and in any event within sixty (60) days of the Vesting Date based on the
same formula applied to active employees. At that same time you
also shall receive a cash payment, if any, equal to the amount of
dividends accrued over the Performance Period with respect to your
Performance Shares multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout.
|
Termination
Due to Disposition of Subsidiary
|
(1)
If your employment is terminated (other than for cause or your voluntary
termination) by reason of a divestiture or change in control of a
subsidiary of PG&E Corporation, which divestiture or change in control
results in such subsidiary no longer qualifying as a subsidiary
corporation under Section 424(f) of the Internal Revenue Code of 1986, as
amended, or (2) if your employment is terminated (other than for cause or
your voluntary termination) coincident with the sale of all or
substantially all of the assets of a subsidiary of PG&E Corporation,
all Performance Shares shall vest proportionally based on the number of
months during the Performance Period that you were employed (rounded down)
divided by the number of months in the Performance Period (36
months). All other outstanding Performance Shares (and any
associated accrued dividends) shall automatically be cancelled upon such
termination. Your vested Performance Shares will be payable, if
at all, as soon as practicable after the Vesting Date and in any event
within sixty (60) days of the Vesting Date, based on the same formula
applied to active employees. At that same time you also shall
receive a cash payment, if any, equal to the amount of dividends accrued
over the Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
|
Change
in Control
|
In
the event of a Change in Control, the surviving, continuing, successor, or
purchasing corporation or other business entity or parent thereof, as the
case may be (the “Acquiror
”
), may, without your
consent, either assume or continue PG&E Corporation’s rights and
obligations under this Agreement or provide a substantially equivalent
award in substitution for the Performance Shares subject to this
Agreement. If the Acquiror assumes or continues PG&E
Corporation’s rights and obligations under this Agreement or substitutes a
substantially equivalent award, TSR shall be calculated by aggregating (a)
the TSR of PG&E Corporation for the period from January 1 of the year
of grant to the date of the Change in Control, and (b) the TSR of the
Acquiror from the date of the Change in Control to the last calendar day
of the year preceding the Vesting Date. The payout
percentage reflected in the table set forth above for the highest
percentile TSR performance met or exceeded when calculated on that basis,
and considering any adjustments to the comparator group, will be used to
determine the amount of the payout, if any, upon settlement of the
assumed, continued or substituted award, which settlement shall occur as
soon as practicable after the Vesting Date and in any event within sixty
(60) days of the Vesting Date. At that time you also
shall receive a cash payment, if any, equal to the amount of
dividends accrued with respect to your Performance Shares to the first
business day of the year following the Change in Control multiplied by the
same payout percentage used to determine the amount, if any, of the
Performance Share payout.
If
this Award is neither assumed nor continued by the Acquiror or if the
Acquiror does not provide a substantially equivalent award in substitution
for the Performance Shares subject to this Agreement, all of your
outstanding Performance Shares shall automatically vest and become
nonforfeitable when the Change in Control of PG&E Corporation occurs
before the Vesting Date. Such vested Performance Shares will
become payable as soon as practicable following the original Vesting Date
and in any event within sixty (60) days of the original Vesting
Date. The payment, if any, will be based on PG&E
Corporation’s TSR for the period from January 1 of the year of grant to
the date of the Change in Control compared to the TSR of the other
companies in PG&E Corporation’s comparator group
2
for the same period. The
payment will be calculated by multiplying the number of vested Performance
Shares by the payout percentage. The resulting number of
Performance Shares will be multiplied by the average closing price of a
share of PG&E Corporation common stock for the last 30 calendar days
preceding the Change in Control as reported on the New York Stock
Exchange. At the same time you also shall receive a cash
payment, if any, equal to the amount of dividends accrued with respect to
your Performance Shares to the first business day of the year following
the Change in Control multiplied by the same payout percentage used to
determine the amount, if any, of the Performance Share
payout.
|
Termination
In Connection with a Change in Control
|
If
your employment is terminated in connection with a Change in Control
within three months before the Change in Control occurs or within two
years following the Change in Control, all of your outstanding Performance
Shares (to the extent they did not previously vest upon failure of the
Acquiror to assume or continue this Award) shall automatically vest and
become nonforfeitable on the date of termination of your employment. Your
vested Performance Shares will be payable, if at all, as soon as
practicable following the original Vesting date and in any event within
sixty (60) days of the Vesting Date and will be based on the same formula
applied to active employees. You shall also at that time
receive a cash payment, if any, equal to the amount of dividends accrued
over the Performance Period with respect to your vested Performance Shares
multiplied by the same payout percentage used to determine the amount, if
any, of the Performance Share payout.
PG&E
Corporation shall have the sole discretion to determine whether
termination of your employment was made in connection with a Change in
Control.
|
Withholding
Taxes
|
PG&E
Corporation will withhold amounts necessary to satisfy applicable taxes
from the payment to be made with respect to your Performance
Shares. You will receive the remaining proceeds in
cash.
|
Leaves
of Absence
|
For
purposes of this Agreement, if you are on an approved leave of absence
from PG&E Corporation, or a recipient of PG&E Corporation
sponsored disability benefits, you will continue to be considered as
employed. If you do not return to active employment upon the
expiration of your leave of absence or the expiration of your PG&E
Corporation sponsored disability benefits, you will be considered to have
voluntarily terminated your employment. See above under
“Voluntary Termination.”
PG&E
Corporation reserves the right to determine which leaves of absence will
be considered as continuing employment and when your employment terminates
for all purposes under this Agreement.
|
No
Retention Rights
|
This
Agreement is not an employment agreement and does not give you the right
to be retained by PG&E Corporation. Except as otherwise
provided in an applicable employment agreement, PG&E Corporation
reserves the right to terminate your employment at any time and for any
reason.
|
Applicable
Law
|
This
Agreement will be interpreted and enforced under the laws of the State of
California.
|
|
PG&E
CORPORATION
|
|
EXECUTIVE
STOCK OWNERSHIP PROGRAM
|
1.
|
Description
. The
Executive Stock Ownership Program (“Program”) was approved by the
Nominating and Compensation Committee of the Board of Directors on October
15, 1997. The Program is an important element of the
Committee’s compensation policy of aligning executive interests with those
of the Corporation’s shareholders. As an integral part of the
Program, the Committee also authorized the use of Special Incentive Stock
Ownership Premiums (“SISOPs”) which are designed to provide incentives to
Eligible Executives to assist in achieving minimum stock ownership targets
established by the Committee. These Guidelines were originally
adopted by the Committee on November 19, 1997, amended by the Committee on
July 22, 1998, October 21, 1998, February 16, 2000, September 19, 2000,
February 19, 2003, February 15, 2006, effective January 1, 2009, and
February 17, 2009. These amended Guidelines, along with the
written materials provided to the Committee on October 15, 1997, describe
the Program which became effective on January 1, 1998. The
Program is administered by the Corporation’s Senior Human Resources
Officer.
|
2.
|
Eligible
Executives
. The Chief Executive Officer shall designate
the officers of the Corporation and its affiliates who shall be Eligible
Executives covered by the Program. The officers covered by the Guidelines
and the applicable total stock ownership target (“Target”)
are:
|
Officer
Band
|
Position
|
Total
Stock
Ownership
Target
|
1
|
CEO
|
3 x
base salary
|
2
|
Heads
of Business Lines, CFO, & General Counsel
|
2 x
base salary
|
3
|
SVPs
of Corp. & Utility
|
1.5
x base
salary
|
3.
|
Annual
Milestones
. Under the Guidelines, Targets are designed
to be achieved by the end of the fifth calendar year following the
calendar year in which an officer first becomes an Eligible Executive
(“Target Date”). Annual Milestones have been established as a
means of measuring progress towards achieving Targets and of providing
incentives for Eligible Executives to expeditiously meet their
Targets. The Annual Milestone at the end of the first full
calendar year is 20 percent of the Target, and the Annual Milestone for
each succeeding year is an additional 20 percent of the
Target. Annual Milestones shall be adjusted to reflect changes
in base salary; provided, however, that in each instance any such
modification shall be amortized over the remaining original five-year
term. Following the Target Date, Targets also shall be modified
to reflect changes in base salary.
|
4.
|
Calculation of Stock
Ownership Levels
. Stock ownership level is the dollar
value of stock and stock equivalents owned by an Eligible Executive and
calculated as of the last day of the calendar year (“Measurement
Date”). The purpose of this calculation is to determine the
value of the stock or stock equivalents owned by the Eligible Executive as
compared with the Annual Milestone or Target for that
executive. For purposes of this calculation, the value per
share of stock or stock equivalent ("Measurement Value") is the average
closing price of PG&E Corporation common stock as traded on the New
York Stock Exchange for the last thirty (30) trading days of the
year.
|
|
a)
|
The
value of stock beneficially owned by the Eligible Executive is determined
by multiplying the number of shares owned beneficially on the Measurement
Date times the Measurement Value.
|
|
b)
|
The
value of PG&E Corporation phantom stock units credited to the Eligible
Executive's account in the PG&E Corporation Supplemental Retirement
Savings Plan (“SRSP”) is determined by multiplying the number of phantom
stock units credited to the Eligible Executive's SRSP account on the
Measurement Date times the Measurement
Value.
|
|
c)
|
The
value of stock held in the PG&E Corporation stock fund of any defined
contribution plan maintained by PG&E Corporation or any of its
subsidiaries is determined by multiplying the number of shares in such
plan on the Measurement Date times the Measurement
Value.
|
|
d)
|
The
value of restricted stock held by the Eligible Executive is determined by
multiplying the number of shares held by the Eligible Executive on the
Measurement Date times the Measurement Value (for purposes of this
calculation, restricted stock shall include any shares that have been
approved by the Compensation Committee but not yet issued as of the
Measurement Date).
|
|
e)
|
The
value of unvested restricted stock units held by the Eligible Executive on
the Measurement Date is determined by multiplying the number of
outstanding restricted stock units held by the Eligible Executive on the
Measurement Date times the Measurement Value (for purposes of this
calculation, restricted stock units shall include any units that have been
approved by the Compensation Committee but not yet issued as of the
Measurement Date).
|
5.
|
Award of
SISOPs
. SISOPs are awarded to Eligible Executives who
achieve and maintain stock ownership levels prior to the end of the third
year following the year in which an officer first became an Eligible
Executive. For purposes of determining awards, the total stock
ownership level is calculated as set forth under paragraph 4 on the
Measurement Date; however, such calculations will exclude the value of
restricted stock held by the Eligible Executive as defined in paragraph
4(d) and will exclude the value of restricted stock units held by the
Eligible Executive as defined in paragraph 4(e). The amount of
a SISOP award shall be equal to:
|
|
a)
|
For
the first year, 20 percent of the amount of the Eligible Executive’s stock
ownership level at the end of the year, up to the Annual Milestone, plus
an additional 30 percent of the amount by which the stock ownership level
exceeds the Annual Milestone up to the Target;
and
|
|
b)
|
For
each of the second and third years, the current stock ownership level is
reduced by the stock ownership level used to calculate previous SISOP
awards to determine the new ownership, then 20 percent of the amount up to
the Annual Milestone by which the end of the year stock ownership level
exceeds the beginning of the year stock ownership level, plus an
additional 30 percent of the amount by which the end of the year balance
exceeds the Annual Milestone, up to the
Target.
|
6.
|
SISOPs Credited to the
SRSP.
Upon award, SISOPs are credited to the Eligible
Executive's SRSP account and converted into units of phantom stock each
equal in value to a share of PG&E Corporation common stock ("SISOP
units") as determined in accordance with the SRSP. The SISOP
units constitute "incentive awards" authorized to be awarded by the
Committee to Eligible Executives under the PG&E Corporation 2006
Long-Term Incentive Plan ("2006 LTIP"). Upon credit of SISOP
units to an Eligible Executive's SRSP account, an equal number of shares
of PG&E Corporation common stock shall be reserved for issuance from
the pool of shares authorized for issuance under the 2006
LTIP. Once a SISOP unit is credited to the Eligible Executive's
SRSP account, it shall be subject to all of the terms and conditions
specifically applicable to SISOP units under the SRSP. Once
vested in accordance with paragraph 7 below, SISOP units are distributed
in the form of an equal number of shares of PG&E Corporation common
stock as provided in the SRSP.
|
7.
|
Vesting.
SISOPs
vest only upon the expiration of three years after the date of award
(provided the Eligible Executive continues to be employed on such
date). An Eligible Executive's unvested SISOPs will be
forfeited upon termination of employment except as otherwise provided in
the Vesting Guidelines in effect on the grant date for a particular
award.
|
8.
|
Forfeiture of SISOP
Units
. So long as SISOP units remain unvested, such
units are subject to forfeiture if, on each Measurement Date, the Eligible
Executive's stock ownership is less than the Minimum Ownership Level
established when the SISOPs were granted (see paragraph 5). To
determine forfeiture, the following steps are followed on each Measurement
Date:
|
|
a)
|
The
total stock and stock equivalents owned by an Eligible Executive is
determined as set forth under paragraph 4, excluding sections 4(d) and
4(e). This total ("Current Holdings") is compared with the
Minimum Ownership Level determined when the SISOPs were
granted. If the Current Holdings are equal to or greater than
the Minimum Ownership Level, then no unvested SISOP units are
forfeited. If the Current Holdings are less than the Minimum
Ownership Level, then the unvested SISOP units are forfeited in the same
proportion as the Current Holdings are less than Minimum Ownership Level
(for example, if the Current Holdings are 20 percent less than the Minimum
Ownership Level, then 20 percent of the SISOP units are
forfeited).
|
9.
|
Failure to Achieve or
Maintain Target
. Failure to achieve stock ownership
levels at Target on the Target Date, or to maintain stock ownership levels
at Target on any Measurement Date thereafter, will result in the deferral
into the PG&E Corporation Phantom Stock Fund of the SRSP of awards
from the PG&E Corporation Long-Term Incentive Program and/or 2006 LTIP
that are settled only in cash (“Cash-Settled Awards”) and the Short-Term
Incentive Plan (“STIP”). As of the Target Date or any
Measurement Date, to the extent that stock ownership levels are below
Target, the Cash-Settled Award or STIP award (in an amount determined by
PG&E Corporation in its sole discretion) shall be converted into
phantom stock units, to the extent necessary to achieve the Target stock
ownership level. Such conversion of Cash-Settled Awards and
STIP awards shall continue for successive Measurement Dates, if necessary,
until Target is met. Phantom stock units attributable to
Cash-Settled Awards and STIP awards described in this paragraph 9 will be
paid from the SRSP in a lump sum in accordance with Section 7(a) of the
SRSP. Notwithstanding anything to the contrary set forth in
this Section 9, the deferral provisions of this Section 9 shall be applied
only with respect to Cash-Settled Awards and STIP awards that can be
deferred in accordance with the initial deferral election rules of Section
409A of the Internal Revenue Code of 1986 determined as if the Eligible
Executive had made a deferral election on the Target Date or Measurement
Date, as applicable, and the Eligible Executive shall be deemed to have
made the election hereunder on the applicable Target Date or Measurement
Date by failing to achieve the applicable stock ownership
levels.
|
1
|
Severance benefits for Officers
who are currently covered by an employment agreement will continue to be
provided solely under such agreements until their expiration at which time
this Policy will become effective for such Officers. If an
employee becomes a covered Officer under this Policy as a result of a
promotion, if such Officer was then covered by a severance arrangement
subject to Section 409A of the Internal Revenue Code of 1986 (“Code
Section 409A”), the severance benefits under this Policy provided to such
person shall comply with the time and form of payment provisions of such
prior severance arrangement, to the extent required by Code Section
409A.
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John
R. Simon
Senior
Vice President, Human Resources
|
PG&E CORPORATION | ||
By: | JOHN R. SIMON | |
|
John R. Simon
|
|
Senior Vice President - Human Resources |
Year
Ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
(in millions, except per share
amounts)
|
||||||||||||
Net
Income
|
$ | 1,338 | $ | 1,006 | $ | 991 | ||||||
Less:
distributed earnings to common shareholders
|
560 | 508 | 460 | |||||||||
Undistributed
earnings
|
778 | 498 | 531 | |||||||||
Less:
undistributed earnings from discontinued operations
|
154 | - | - | |||||||||
Undistributed
earnings from continuing operations
|
$ | 624 | $ | 498 | $ | 531 | ||||||
Common
shareholder earnings
|
||||||||||||
Basic
|
||||||||||||
Distributed
earnings to common shareholders
|
$ | 560 | $ | 508 | $ | 460 | ||||||
Undistributed
earnings allocated to common shareholders – continuing
operations
|
592 | 472 | 503 | |||||||||
Undistributed
earnings allocated to common shareholders – discontinued
operations
|
146 | - | - | |||||||||
Total common shareholders
earnings, basic
|
$ | 1,298 | $ | 980 | $ | 963 | ||||||
Diluted
|
||||||||||||
Distributed
earnings to common shareholders
|
$ | 560 | $ | 508 | $ | 460 | ||||||
Undistributed
earnings allocated to common shareholders – continuing
operations
|
593 | 473 | 504 | |||||||||
Undistributed
earnings allocated to common shareholders – discontinued
operations
|
146 | - | - | |||||||||
Total
common shareholders earnings, diluted
|
$ | 1,299 | $ | 981 | $ | 964 | ||||||
Weighted average common shares
outstanding, basic
|
357 | 351 | 346 | |||||||||
9.50%
Convertible Subordinated Notes
|
19 | 19 | 19 | |||||||||
Weighted
average common shares outstanding and participating securities,
basic
|
376 | 370 | 365 | |||||||||
Weighted
average common shares outstanding, basic
|
357 | 351 | 346 | |||||||||
Employee
share-based compensation and accelerated share repurchases
(1)
|
1 | 2 | 3 | |||||||||
Weighted
average common shares outstanding, diluted
|
358 | 353 | 349 | |||||||||
9.50%
Convertible Subordinated Notes
|
19 | 19 | 19 | |||||||||
Weighted
average common shares outstanding and participating securities,
diluted
|
377 | 372 | 368 | |||||||||
Net earnings per common share,
basic
|
||||||||||||
Distributed
earnings, basic
(2)
|
$ | 1.57 | $ | 1.45 | $ | 1.33 | ||||||
Undistributed
earnings – continuing operations, basic
|
1.66 | 1.34 | 1.45 | |||||||||
Undistributed
earnings – discontinued operations, basic
|
0.41 | - | - | |||||||||
Total
|
$ | 3.64 | $ | 2.79 | $ | 2.78 | ||||||
Net earnings per common share,
diluted
|
||||||||||||
Distributed
earnings, diluted
|
$ | 1.56 | $ | 1.44 | $ | 1.32 | ||||||
Undistributed
earnings – continuing operations, diluted
|
1.66 | 1.34 | 1.44 | |||||||||
Undistributed
earnings – discontinued operations, diluted
|
0.41 | - | - | |||||||||
Total
|
$ | 3.63 | $ | 2.78 | $ | 2.76 | ||||||
(1)
Includes approximately one million shares of PG&E Corporation
common stock treated as outstanding in connection with accelerated share
repurchase agreements (ASRs) for 2006. The remaining shares of
approximately two million at December 31, 2006 relate to share-based
compensation and are deemed to be outstanding under SFAS No. 128 for the
purpose of calculating EPS. PG&E Corporation has no
remaining obligation under these ASRs as of December 31,
2007.
|
(2)
“Distributed earnings, basic” differs from actual per share amounts paid
as dividends, as the EPS computation under GAAP requires the use of
the weighted average, rather than the actual number of, shares
outstanding.
|
Year
ended December 31,
|
||||||||||||||||||||
2008
|
2007
|
2006
|
2005
|
2004
|
||||||||||||||||
Earnings:
|
||||||||||||||||||||
Net
income
|
$ | 1,199 | $ | 1,024 | $ | 985 | $ | 934 | $ | 3,982 | ||||||||||
Adjustments
for minority interest in losses of less than 100% owned affiliates and the
Company's equity in undistributed income (losses) of less than 50% owned
affiliates
|
- | - | - | - | - | |||||||||||||||
Income
taxes provision
|
488 | 571 | 602 | 574 | 2,561 | |||||||||||||||
Net
fixed charges
|
772 | 889 | 801 | 589 | 671 | |||||||||||||||
Total
Earnings
|
$ | 2,459 | $ | 2,484 | $ | 2,388 | $ | 2,097 | $ | 7,214 | ||||||||||
Fixed
Charges:
|
||||||||||||||||||||
Interest
on short-term borrowings and long-term debt, net
|
794 | $ | 834 | $ | 770 | $ | 573 | $ | 682 | |||||||||||
Interest
on capital leases
|
22 | 23 | 11 | 1 | 1 | |||||||||||||||
AFUDC
debt
|
(44 | ) | 32 | 20 | 15 | (12 | ) | |||||||||||||
Earnings
required to cover preferred stock dividends
|
- | - | - | - | - | |||||||||||||||
Total
Fixed Charges
|
$ | 772 | $ | 889 | $ | 801 | $ | 589 | $ | 671 | ||||||||||
Ratios
of Earnings to
Fixed
Charges
|
3.19 | 2.79 | 2.98 | 3.56 | 10.75 |
Year
ended December 31,
|
||||||||||||||||||||
Earnings:
|
2008
|
2007
|
2006
|
2005
|
2004
|
|||||||||||||||
Net
income
|
$ | 1,199 | $ | 1,024 | $ | 985 | $ | 934 | $ | 3,982 | ||||||||||
Adjustments
for minority interest in losses of less than 100% owned affiliates and the
Company's equity in undistributed income (losses) of less than 50% owned
affiliates
|
- | - | - | - | - | |||||||||||||||
Income
taxes provision
|
488 | 571 | 602 | 574 | 2,561 | |||||||||||||||
Net
fixed charges
|
772 | 889 | 801 | 589 | 671 | |||||||||||||||
Total
Earnings
|
$ | 2,459 | $ | 2,484 | $ | 2,388 | $ | 2,097 | $ | 7,214 | ||||||||||
Fixed
Charges:
|
||||||||||||||||||||
Interest
on short-term borrowings
and
long-term debt, net
|
$ | 794 | 834 | 770 | $ | 573 | $ | 682 | ||||||||||||
Interest
on capital leases
|
22 | 23 | 11 | 1 | 1 | |||||||||||||||
AFUDC
debt
|
(44 | ) | 32 | 20 | 15 | (12 | ) | |||||||||||||
Earnings
required to cover preferred stock dividends
|
- | - | - | - | ||||||||||||||||
Total
Fixed Charges
|
772 | 889 | 801 | 589 | 671 | |||||||||||||||
Preferred
Stock Dividends:
|
||||||||||||||||||||
Tax
deductible dividends
|
9 | 9 | 12 | 12 | 9 | |||||||||||||||
Pre-tax
earnings required to cover
non-tax
deductible preferred stock
dividend
requirements
|
7 | 8 | 3 | 13 | 34 | |||||||||||||||
Total
Preferred Stock Dividends
|
16 | 17 | 15 | 25 | 43 | |||||||||||||||
Total
Combined Fixed Charges
and
Preferred Stock Dividends
|
$ | 788 | $ | 906 | $ | 816 | $ | 614 | $ | 714 | ||||||||||
Ratios
of Earnings to Combined Fixed Charges and
Preferred
Stock Dividends
|
3.12 | 2.74 | 2.93 | 3.42 | 10.10 |
SELECTED FINANCIAL DATA | ||||||||||||||||||||
200
8
|
2007
|
2006
|
2005
|
2004
(1)
|
||||||||||||||||
(in
millions, except per share amounts)
|
||||||||||||||||||||
PG&E
Corporation
(2)
For the
Year
|
|
|||||||||||||||||||
Operating
revenues
|
$ | 14,628 | $ | 13,237 | $ | 12,539 | $ | 11,703 | $ | 11,080 | ||||||||||
Operating
income
|
2,261 | 2,114 | 2,108 | 1,970 | 7,118 | |||||||||||||||
Income
from continuing operations
|
1,184 | 1,006 | 991 | 904 | 3,820 | |||||||||||||||
Earnings
per common share from continuing operations, basic
|
3.23 | 2.79 | 2.78 | 2.37 | 9.16 | |||||||||||||||
Earnings
per common share from continuing operations, diluted`
|
3.22 | 2.78 | 2.76 | 2.34 | 8.97 | |||||||||||||||
Dividends
declared per common share
(3)
|
1.56 | 1.44 | 1.32 | 1.23 | - | |||||||||||||||
At
Year-End
|
||||||||||||||||||||
Book
value per common share
(4)
|
$ | 24.64 | $ | 22.91 | $ | 21.24 | $ | 19.94 | $ | 20.90 | ||||||||||
Common
stock price per share
|
38.71 | 43.09 | 47.33 | 37.12 | 33.28 | |||||||||||||||
Total
assets
|
40,860 | 36,632 | 34,803 | 34,074 | 34,540 | |||||||||||||||
Long-term
debt (excluding current portion)
|
9,321 | 8,171 | 6,697 | 6,976 | 7,323 | |||||||||||||||
Rate
reduction bonds (excluding current portion)
|
- | - | - | 290 | 580 | |||||||||||||||
Energy
recovery bonds (excluding current portion)
|
1,213 | 1,582 | 1,936 | 2,276 | - | |||||||||||||||
Preferred
stock of subsidiary with mandatory redemption provisions
|
- | - | - | - | 122 | |||||||||||||||
Pacific
Gas and Electric Company
For the
Year
|
||||||||||||||||||||
Operating
revenues
|
$ | 14,628 | $ | 13,238 | $ | 12,539 | $ | 11,704 | $ | 11,080 | ||||||||||
Operating
income
|
2,266 | 2,125 | 2,115 | 1,970 | 7,144 | |||||||||||||||
Income
available for common stock
|
1,185 | 1,010 | 971 | 918 | 3,961 | |||||||||||||||
At
Year-End
|
||||||||||||||||||||
Total
assets
|
$ | 40,537 | $ | 36,310 | $ | 34,371 | $ | 33,783 | $ | 34,302 | ||||||||||
Long-term
debt (excluding current portion)
|
9,041 | 7,891 | 6,697 | 6,696 | 7,043 | |||||||||||||||
Rate
reduction bonds (excluding current portion)
|
- | - | - | 290 | 580 | |||||||||||||||
Energy
recovery bonds (excluding current portion)
|
1,213 | 1,582 | 1,936 | 2,276 | - | |||||||||||||||
Preferred
stock with mandatory redemption provisions
|
- | - | - | - | 122 | |||||||||||||||
(1)
Financial data reflects the recognition of regulatory assets provided
under the December 19, 2003 settlement agreement entered into among
PG&E Corporation, Pacific Gas and Electric Company, and the California
Public Utilities Commission to resolve Pacific Gas and Electric Company’s
proceeding under Chapter 11 of the U.S. Bankruptcy Code. Pacific Gas
and Electric Company’s reorganization under Chapter 11 became effective on
April 12, 2004.
|
||||||||||||||||||||
(2)
Matters relating to discontinued operations are discussed in the
section entitled “Management's Discussion and Analysis of Financial
Condition and Results of Operations” and in Note 6 of the Notes to the
Consolidated Financial Statements.
|
||||||||||||||||||||
(3)
The Board of Directors of PG&E Corporation declared a cash dividend of
$0.30 per share for the first three quarters of 2005. In the fourth
quarter of 2005, the Board of Directors increased the quarterly cash
dividend to $0.33 per share. Beginning in the first quarter of 2007,
the Board of Directors increased the quarterly cash dividend to $0.36 per
share. Beginning in the first quarter of 2008, the Board of Directors
increased the quarterly cash dividend to $0.39 per share. The Utility
paid quarterly dividends on common stock held by PG&E Corporation and
a wholly owned subsidiary aggregating to $589 million in 2008 and $547
million in 2007. See Note 7 of the Notes to the Consolidated
Financial Statements.
|
||||||||||||||||||||
(4)
Book value per common share includes the effect of participating
securities. The dilutive effect of outstanding stock options and
restricted stock are further disclosed in Note 9 of the Notes to the
Consolidated Financial Statements.
|
●
|
The Outcome of Regulatory
Proceedings and the Impact of Ratemaking
Mechanisms
. Most of the Utility’s revenue requirements
are set based on its costs of service in proceedings such as the General
Rate Case (“GRC”) filed with the CPUC and transmission owner (“TO”) rate
cases filed with the FERC. Unlike the current GRC, which set
revenue requirements for a four-year period (2007 through 2010), it is
expected that the next GRC will set revenue requirements for the Utility’s
electric and natural gas distribution operations and electric generation
operations for a three-year period (2011 through 2013). From
time to time, the Utility also files separate applications requesting the
CPUC or the FERC to authorize additional revenue requirements for specific
capital expenditure projects, such as new power plants, gas or electric
transmission facilities, installation of an advanced metering
infrastructure, and reliability or system infrastructure
improvements. The Utility’s revenues will also be affected by
incentive ratemaking, including the CPUC’s customer energy efficiency
shareholder incentive mechanism. (See “Regulatory Matters”
below.) In addition, the CPUC has authorized the Utility to
recover 100% of its reasonable electric fuel and energy procurement costs
and has established a timely rate adjustment mechanism to recover such
costs. As a result, the Utility’s revenues and costs can be
affected by volatility in the prices of natural gas and
electricity. (See “Risk Management Activities”
below.)
|
●
|
Capital Structure and Return
on Common Equity.
The Utility’s current
CPUC-authorized capital structure includes a 52% common equity
component. The CPUC has authorized the Utility to earn an ROE
of 11.35% on the equity component of its electric and natural gas
distribution and electric generation rate base. The Utility’s
capital structure is set until 2011, and its cost of capital components,
including an 11.35% ROE, will only be changed before 2011 if the annual
automatic adjustment mechanism established by the CPUC is
triggered. If the 12-month October through September average
yield for the Moody’s Investors Service (“Moody’s”) utility bond index
increases or decreases by more than 1% as compared to the applicable
benchmark, the Utility can adjust its authorized cost of capital effective
on January 1 of the following year. The 12-month October 2007
through September 2008 average yield of the Moody’s utility bond index did
not trigger a change in the Utility’s authorized cost of capital for
2009. The Utility can also apply for an adjustment to either
its capital structure or cost of capital at any time in the event of
extraordinary circumstances.
|
●
|
The Ability of the Utility to
Control Costs While Improving Operational Efficiency and
Reliability
. The Utility’s revenue requirements are
generally set at a level to allow the Utility the opportunity to recover
its basic forecasted operating expenses, as well as to earn an ROE and
recover depreciation, tax, and interest expense associated with authorized
capital expenditures. Differences in the amount or timing of forecasted
and actual operating expenses and capital expenditures can affect the
Utility’s ability to earn its authorized rate of return and the amount of
PG&E Corporation’s net income available for
shareholders. When capital expenditures are higher than
authorized levels, the Utility incurs associated depreciation, property
tax, and interest expense, but does not recover revenues to offset these
expenses or earn an ROE, until the capital expenditures are added to rate
base in future rate cases. Items that could cause higher
expenses than provided for in the last GRC primarily relate to the
Utility’s efforts to maintain the aging infrastructure of its electric and
natural gas systems, to improve the reliability and safety of its electric
and natural gas systems, higher debt interest rates, and technology
infrastructure and support. In addition, the Utility intends to
accelerate the work associated with system-wide gas leak surveys and
targets completing this work in a little more than a year. This
is expected to result in additional costs. (See “Results of Operations”
below.) The Utility continually seeks to achieve operational
efficiencies and improve reliability while creating future sustainable
cost-savings to offset these higher anticipated expenses. The
Utility also seeks to make the amount and timing of its capital
expenditures consistent with budgeted amounts and
timing.
|
●
|
The Availability and Terms of
Debt and Equity Financing.
The amount and timing of the
Utility’s future financing needs will depend on various factors, some of
which include the conditions in the capital markets, the amount and timing
of scheduled principal and interest payments on long-term debt, the amount
and timing of planned capital expenditures, and the amount and timing of
interest payments related to the remaining disputed claims that were made
by electricity suppliers in the Utility’s proceeding under Chapter 11 of
the U.S. Bankruptcy Code (“Chapter 11”). (See Note 15 of the
Notes to the Consolidated Financial Statements.) The amount of
the Utility’s short-term financing will vary depending on the level of
operating cash flows, seasonal demand for electricity and natural gas,
volatility in electricity and natural gas prices, and collateral
requirements related to price risk management activity, among other
factors. The Utility has continued to have access to the
capital markets despite the recent financial turmoil and economic
downturn, although interest rates on the Utility’s short-term and
long-term debt have increased. For example, the Utility’s $600
million principal amount of 10-year senior notes, issued on October 21,
2008, bears interest at 8.25% compared to the Utility’s $700 million
principal amount of 10-year senior notes, issued in December 2007 and
March 3, 2008 that bear interest at 5.625%. In addition, the
Utility’s commercial paper issuance rate reached a high of 7.3% on
September 30, 2008 and a low of 1.2% as of December 26, 2008. In order to
maintain the Utility’s CPUC-authorized capital structure, PG&E
Corporation will be required to contribute equity to the Utility. The
timing and amount of these future equity contributions will affect the
timing and amount of any future equity or debt issuances by PG&E
Corporation. (See “Liquidity and Financial Resources”
below.)
|
●
|
the
Utility’s ability to manage capital expenditures and its operating and
maintenance expenses within authorized levels;
|
●
|
the
outcome of pending and future regulatory proceedings and
whether the Utility is able to timely recover its costs through
rates;
|
●
|
the
adequacy and price of electricity and natural gas supplies, and the
ability of the Utility to manage and respond to the volatility of the
electricity and natural gas markets, including the ability of the Utility
and its counterparties to post or return collateral;
|
●
|
the
effect of weather, storms, earthquakes, fires, floods, disease, other
natural disasters, explosions, accidents, mechanical breakdowns, acts of
terrorism, and other events or hazards on the Utility’s facilities and
operations, its customers, and third parties on which the Utility
relies;
|
●
|
the
potential impacts of climate change on the Utility’s electricity and
natural gas businesses;
|
●
|
changes
in customer demand for electricity and natural gas resulting from
unanticipated population growth or decline, general economic and financial
market conditions, changes in technology, including the development of
alternative energy sources, or other reasons;
|
●
|
operating
performance of Diablo Canyon, the availability of nuclear fuel, the
occurrence of unplanned outages at Diablo Canyon, or the temporary or
permanent cessation of operations at Diablo Canyon;
|
●
|
whether
the Utility can maintain the cost savings it has recognized from operating
efficiencies it has achieved and identify and successfully implement
additional sustainable cost-saving measures;
|
●
|
whether
the Utility incurs substantial expense to improve the safety and
reliability of its electric and natural gas systems;
|
●
|
whether
the Utility achieves the CPUC’s energy efficiency targets and recognizes
any incentives the Utility may earn in a timely manner;
|
●
|
the
impact of changes in federal or state laws, or their interpretation, on
energy policy and the regulation of utilities and their holding
companies;
|
●
|
the
impact of changing wholesale electric or gas market rules, including new
rules of the California Independent System Operator (“CAISO”) to
restructure the California wholesale electricity
market;
|
●
|
how
the CPUC administers the conditions imposed on PG&E Corporation when
it became the Utility’s holding company;
|
●
|
the
extent to which PG&E Corporation or the Utility incurs costs and
liabilities in connection with litigation that are not recoverable through
rates, from insurance, or from other third parties;
|
●
|
the
ability of PG&E Corporation, the Utility, and
counterparties, to access capital markets and other sources of credit in a
timely manner on acceptable terms, especially given the recent
deteriorating conditions in the economy and financial
markets;
|
●
|
the
impact of environmental laws and regulations and the costs of compliance
and remediation;
|
●
|
the
effect of municipalization, direct access, community choice aggregation,
or other forms of bypass; and
|
●
|
the
impact of changes in federal or state tax laws, policies, or
regulations.
|
Year
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Utility
|
||||||||||||
Electric
operating revenues
|
$ | 10,738 | $ | 9,481 | $ | 8,752 | ||||||
Natural
gas operating revenues
|
3,890 | 3,757 | 3,787 | |||||||||
Total
operating revenues
|
14,628 | 13,238 | 12,539 | |||||||||
Cost
of electricity
|
4,425 | 3,437 | 2,922 | |||||||||
Cost
of natural gas
|
2,090 | 2,035 | 2,097 | |||||||||
Operating
and maintenance
|
4,197 | 3,872 | 3,697 | |||||||||
Depreciation,
amortization, and decommissioning
|
1,650 | 1,769 | 1,708 | |||||||||
Total
operating expenses
|
12,362 | 11,113 | 10,424 | |||||||||
Operating
income
|
2,266 | 2,125 | 2,115 | |||||||||
Interest
income
|
91 | 150 | 175 | |||||||||
Interest
expense
|
(698 | ) | (732 | ) | (710 | ) | ||||||
Other
income (expense), net
(1)
|
14 | 38 | (7 | ) | ||||||||
Income
before income taxes
|
1,673 | 1,581 | 1,573 | |||||||||
Income
tax provision
|
488 | 571 | 602 | |||||||||
Income
available for common stock
|
$ | 1,185 | $ | 1,010 | $ | 971 | ||||||
PG&E Corporation,
Eliminations, and Other
(2)
|
||||||||||||
Operating
revenues
|
$ | - | $ | (1 | ) | $ | - | |||||
Operating
expenses
|
5 | 10 | 7 | |||||||||
Operating
loss
|
(5 | ) | (11 | ) | (7 | ) | ||||||
Interest
income
|
3 | 14 | 13 | |||||||||
Interest
expense
|
(30 | ) | (30 | ) | (28 | ) | ||||||
Other
expense, net
|
(32 | ) | (9 | ) | (6 | ) | ||||||
Loss
before income taxes
|
(64 | ) | (36 | ) | (28 | ) | ||||||
Income
tax benefit
|
(63 | ) | (32 | ) | (48 | ) | ||||||
Income
(loss) from continuing operations
|
(1 | ) | (4 | ) | 20 | |||||||
Discontinued
operations
(3)
|
154 | - | - | |||||||||
Net
income (loss)
|
$ | 153 | $ | (4 | ) | $ | 20 | |||||
Consolidated
Total
|
||||||||||||
Operating
revenues
|
$ | 14,628 | $ | 13,237 | $ | 12,539 | ||||||
Operating
expenses
|
12,367 | 11,123 | 10,431 | |||||||||
Operating
income
|
2,261 | 2,114 | 2,108 | |||||||||
Interest
income
|
94 | 164 | 188 | |||||||||
Interest
expense
|
(728 | ) | (762 | ) | (738 | ) | ||||||
Other
income (expense), net
(1)
|
(18 | ) | 29 | (13 | ) | |||||||
Income
before income taxes
|
1,609 | 1,545 | 1,545 | |||||||||
Income
tax provision
|
425 | 539 | 554 | |||||||||
Income
from continuing operations
|
1,184 | 1,006 | 991 | |||||||||
Discontinued
operations
(3)
|
154 | - | - | |||||||||
Net
income
|
$ | 1,338 | $ | 1,006 | $ | 991 | ||||||
(1)
Includes preferred stock dividend requirement as other
expense.
|
||||||||||||
(2)
PG&E Corporation eliminates all intercompany transactions in
consolidation.
|
||||||||||||
(3)
Discontinued operations reflect items related to PG&E Corporation’s
former subsidiary NEGT. See Note 6 of the Notes to the Consolidated
Financial Statements for further discussion.
|
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Electric
operating revenue
|
$ | 12,063 | $ | 11,710 | $ | 10,871 | ||||||
DWR
pass-through revenue
(1)
|
(1,325 | ) | (2,229 | ) | (2,119 | ) | ||||||
Utility
electric operating revenue
|
$ | 10,738 | $ | 9,481 | $ | 8,752 |
Utility
electricity sales (in millions of kWh)
(2)
|
74,783 | 64,986 | 64,725 | |||||||||
(1)
These
are revenues collected on behalf of the DWR for electricity allocated to
the Utility’s customers under contracts between the DWR and power
suppliers, and are not included in the Utility's Consolidated Statements
of Income.
(2)
These
volumes exclude electricity provided by DWR.
|
●
|
Electricity
procurement costs passed through to customers increased by approximately
$976 million, primarily due to an increase in the volume of power
purchased by the Utility following the DWR’s termination of a power
purchase contract in December 2007 and during the extended scheduled
outage at Diablo Canyon in 2008. (See “Cost of Electricity”
below.)
|
●
|
Electric
operating revenues to fund public purpose and energy efficiency programs
increased by approximately $266 million, primarily due to an increase in
expenses for these programs. (See “Operating and Maintenance”
below.)
|
●
|
Base
revenue requirements increased by approximately $103 million, as a result
of attrition adjustments as authorized in the 2007 GRC.
|
●
|
Electric
transmission revenues increased by approximately $56 million, primarily
due to an increase in rates as authorized in the current TO rate
case.
|
●
|
Electric
operating revenues increased by approximately $35 million, the portion of
the incentive award approved by the CPUC in December 2008 that is
attributable to the Utility’s 2006 and 2007 electricity energy efficiency
programs.
|
●
|
Other
electric operating revenues increased by approximately $119 million,
primarily due to increases in revenue requirements to recover costs
related to the Diablo Canyon steam generator replacement project and
revenue requirements to fund the SmartMeter
TM
advanced metering project. (See “Capital Expenditures”
below.)
|
●
|
Electricity
procurement costs, which are passed through to customers, increased by
approximately $742 million. (See “Cost of Electricity”
below.)
|
●
|
The
2007 GRC increased 2007 base revenue requirements by approximately $231
million.
|
●
|
Revenues
from public purpose programs, including the California Solar Initiative
program, increased by approximately $141 million. (See Note 3
of the Notes to the Consolidated Financial Statements.)
|
●
|
Electric
transmission revenues increased by approximately $74 million, including an
increase in revenues as authorized in the TO rate
case.
|
●
|
Transmission
revenues decreased by approximately $200 million primarily due to a
decrease in revenues received under the Utility’s reliability must run
(“RMR”) agreements with the CAISO. During 2006, the CPUC
adopted rules to implement state law requirements for California
investor-owned utilities to meet resource adequacy requirements, including
rules to address local transmission system reliability
issues. As the utilities fulfill their responsibilities to meet
these requirements, the number of RMR agreements with the CAISO and the
associated revenues and costs will decline. (See “Cost of
Electricity” below.)
|
●
|
Revenues
in 2006 included approximately $136 million for recovery of scheduling
coordinator costs the Utility incurred from April 1998 through December
2005, as ordered by the FERC. No similar amount was recognized
in 2007.
|
●
|
Revenues
in 2006 included approximately $65 million for recovery of net interest
related to Disputed Claims for the period between the effective date of
the Utility’s plan of reorganization under Chapter 11 in April 2004 and
the first issuance of the ERBs in February 2005, and for certain energy
supplier refund litigation costs upon completion of the CPUC’s 2005 Annual
Electric True-up verification audit. No similar amount was
recognized in 2007.
|
●
|
Other
electric operating revenues decreased by approximately $58 million,
reflecting a pension revenue requirement that was recovered in 2006 but
not in 2007.
|
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Cost
of purchased power
|
$ | 4,516 | $ | 3,443 | $ | 3,114 | ||||||
Proceeds
from surplus sales allocated to the Utility
|
(255 | ) | (155 | ) | (343 | ) | ||||||
Fuel
used in own generation
|
164 | 149 | 151 | |||||||||
Total
cost of electricity
|
$ | 4,425 | $ | 3,437 | $ | 2,922 | ||||||
Average
cost of purchased power per kWh
|
$ | 0.088 | $ | 0.089 | $ | 0.084 | ||||||
Total
purchased power (in millions of kWh)
|
51,100 | 38,828 | 36,913 |
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Cost
of natural gas sold
|
$ | 1,955 | $ | 1,859 | $ | 1,958 | ||||||
Cost
of natural gas transportation
|
135 | 176 | 139 | |||||||||
Total
cost of natural gas
|
$ | 2,090 | $ | 2,035 | $ | 2,097 | ||||||
Average
cost per Mcf of natural gas sold
|
$ | 7.43 | $ | 7.04 | $ | 7.28 | ||||||
Total
natural gas sold (in millions of Mcf)
|
263 | 264 | 269 |
●
|
Public
purpose program and customer energy efficiency incentive program expenses
increased by approximately $290 million primarily due to increased
customer participation and increased marketing of new and existing
programs, including the California Solar Initiative program and the
Self-Generation Incentive Program. Of these changes,
approximately $266 million were recovered in electric operating revenues
and $24 million were recovered in natural gas operating
revenues. Expenses related to public purpose programs and
energy efficiency programs are generally fully recoverable and differences
between costs and revenues in a particular period are due to timing
differences.
|
●
|
Employee
benefit costs increased by approximately $59 million, primarily reflecting
unrealized losses in the long-term disability plan trust due to the
decline in the market value of trust investments as financial markets
deteriorated in the second half of
2008.
|
●
|
Costs
increased by approximately $38 million for the repair and restoration of
electric distribution systems and to respond to customer inquiries
following the January 2008 winter storm. Of the approximately
$38 million in costs, the CPUC has authorized the Utility to recover
approximately $8 million from customers. There was no similar
storm in the same period in 2007.
|
●
|
Labor
costs increased by approximately $39 million to conduct expanded natural
gas leak surveys in parts of the Utility’s service territory and to make
related repairs in an effort to improve operating and maintenance
processes in the Utility’s natural gas system.
|
●
|
Maintenance
costs increased by approximately $10 million due to the longer duration of
the planned outage of Diablo Canyon Unit 2 in 2008 compared to the Diablo
Canyon Unit 1 outage in 2007.
|
These
increases were partially offset by the following
factors:
|
|
●
|
Cost
reductions of approximately $60 million, reflecting reductions in labor,
postage, consulting, advertising, and other costs.
|
●
|
Costs
related to injuries and damages decreased by approximately $16 million, as
compared to 2007 when the Utility increased its reserves for such
matters.
|
●
|
Costs
related to software maintenance contracts decreased by $10
million.
|
●
|
Costs
decreased by approximately $12 million as compared to 2007 when the CPUC
ordered the Utility to make customer refunds related to billing
practices.
|
●
|
Costs
decreased by approximately $13 million as compared to 2007 when the
Utility increased the liability related to compensation for employees’
missed meals.
|
●
|
Payments
for customer assistance and public purpose programs, such as the
California Solar Initiative program, increased by approximately $99
million primarily due to increased customer participation in these
programs.
|
●
|
The
Utility’s distribution expenses increased by approximately $40 million
primarily due to service costs related to the creation of new dispatch and
scheduling stations and vegetation management in the Utility’s service
territory.
|
●
|
Billing
and collection costs increased by approximately $33
million.
|
●
|
Labor
costs increased by approximately $33 million primarily due to higher
employee headcount and increased base salaries and incentive
compensation.
|
●
|
Costs
of outside consulting services and contracts primarily related to
information systems increased by approximately $22
million.
|
●
|
Approximately
$22 million was accrued for missed meal payments to certain Utility
employees covered under collective bargaining
agreements.
|
●
|
Workers’
compensation expense increased by approximately $20 million due to an
increase in the Utility’s accrual for its workers’ compensation obligation
(caused by a decrease to the applicable discount rate used to calculate
the obligation) and higher than expected workers’ compensation
claims.
|
●
|
Property
taxes increased by approximately $12 million due to electric plant growth,
tax rate increases, and increases in assessed values in
2007.
|
●
|
In
2006, the Utility reduced its accrual for long-term disability benefits by
approximately $11 million reflecting changes in sick leave eligibility
rules, but there was no similar adjustment in
2007.
|
●
|
Pension
expense decreased by approximately $57 million consistent with the annual
pension contribution, as approved by the CPUC in June
2006.
|
●
|
Severance
costs in 2007 were approximately $30 million lower than in
2006.
|
●
|
In
2006, the Utility increased its environmental remediation accrual by
approximately $30 million due to changes in the California Regional Water
Quality Control Board’s imposed remediation levels, but there was no
similar adjustment in 2007.
|
●
|
The
Utility recorded lower decommissioning expense of approximately $53
million as a result of the 2007 GRC decision to refund over-collections of
decommissioning expense to customers.
|
●
|
Other
depreciation, amortization, and decommissioning expenses, including
amortization of the ERB regulatory asset, decreased by $7
million.
|
●
|
Interest
expense decreased by approximately $29 million primarily due to lower FERC
interest rates accrued on the liability for disputed claims.
|
●
|
Interest
expense decreased by approximately $26 million due to the reduction in the
outstanding balance of ERBs and the maturity of the RRBs in December
2007.
|
●
|
Interest
expense on pollution control bonds decreased by approximately $20 million
due to the repurchase of auction rate pollution control bonds in March and
April 2008. The Utility partially refunded these bonds in
September and October 2008. Additionally, interest expense
decreased due to lower interest rates on outstanding variable rate
pollution control bonds.
|
●
|
Interest
expense decreased by approximately $24 million primarily due to lower
interest rates affecting various balancing accounts.
|
●
|
Other
interest expense decreased by approximately $14 million primarily due to a
lower balance of borrowings outstanding under the Utility’s $2 billion
revolving credit facility and lower commercial paper interest
rates.
|
December
31,
|
||||||||
(in
millions)
|
2008
|
2007
|
||||||
PG&E
Corporation
|
$ | 167 | $ | 204 | ||||
Utility
|
52 | 141 | ||||||
Total
consolidated cash and cash equivalents
|
219 | 345 | ||||||
Utility
restricted cash
|
1,290 | 1,297 | ||||||
Total
consolidated cash, including restricted cash
|
$ | 1,509 | $ | 1,642 |
(in
millions)
|
Issue
Date
|
Amount
|
|||
Senior
notes
|
|||||
5.625%,
due 2017
|
March
3
|
$ | 200 | ||
6.35%,
due 2038
|
March
3
|
400 | |||
8.25%,
due 2018
|
October
21
|
600 | |||
6.25%,
due 2013
|
November
18
|
400 | |||
8.25%,
due 2018
|
November
18
|
200 | |||
Total
senior notes
|
1,800 | ||||
Pollution
control bonds
|
|||||
Series
2008 F, 3.75%, due 2026
|
September
22
|
50 | |||
Series
2008 G, 3.75%, due 2018
|
September
22
|
45 | |||
Series
2008 A and B, variable rates, due 2026
|
October
29
|
149 | |||
Series
2008 C and D, variable rates, due 2016
|
October
29
|
160 | |||
Total
pollution control bonds
|
404 | ||||
Total
long-term debt issuances in 2008
|
$ | 2,204 |
Moody's
|
S&P
|
|||||||
Utility
|
||||||||
Corporate
credit rating
|
A3
|
BBB+
|
||||||
Senior
unsecured debt
|
A3 |
BBB+
|
||||||
Credit
facility
|
A3 |
BBB+
|
||||||
Pollution
control bonds backed by letters of credit
|
Not
rated to Aa1/VMIG1
|
AA-/A-1+
to AAA/A-1+
|
||||||
Pollution
control bonds backed by bond insurance
|
A3 |
A
to AA
|
||||||
Pollution
control bonds – nonbacked
|
A3 |
BBB+
|
||||||
Preferred
stock
|
Baa2
|
BBB-
|
||||||
Commercial
paper program
|
P-2 | A-2 | ||||||
PG&E
Energy Recovery Funding LLC
|
||||||||
Energy
recovery bonds
|
Aaa
|
AAA
|
||||||
PG&E
Corporation
|
||||||||
Corporate
credit rating
|
Baa1
|
Not
rated
|
||||||
Credit
facility
|
Baa1
|
Not
rated
|
●
|
Comparability:
Pay a dividend competitive with the securities of comparable companies
based on payout ratio (the proportion of earnings paid out as dividends)
and, with respect to PG&E Corporation, yield (i.e., dividend divided
by share price);
|
●
|
Flexibility:
Allow sufficient cash to pay a dividend and to fund investments while
avoiding having to issue new equity unless PG&E Corporation or the
Utility's capital expenditure requirements are growing rapidly and
PG&E Corporation or the Utility can issue equity at reasonable cost
and terms; and
|
●
|
Sustainability:
Avoid reduction or suspension of the dividend despite fluctuations in
financial performance except in extreme and unforeseen
circumstances.
|
(in
millions)
|
2008
|
2007
|
2006
|
|||||||||
Net
income
|
$ | 1,199 | $ | 1,024 | $ | 985 | ||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||
Depreciation,
amortization, and decommissioning
|
1,838 | 1,956 | 1,802 | |||||||||
Allowance
for equity funds used during construction
|
(70 | ) | (64 | ) | (47 | ) | ||||||
Gain
on sale of assets
|
(1 | ) | (1 | ) | (11 | ) | ||||||
Deferred
income taxes and tax credits, net
|
593 | 43 | (287 | ) | ||||||||
Other
changes in noncurrent assets and liabilities
|
(25 | ) | 188 | 116 | ||||||||
Effect
of changes in operating assets and liabilities:
|
||||||||||||
Accounts
receivable
|
(83 | ) | (6 | ) | 128 | |||||||
Inventories
|
(59 | ) | (41 | ) | 34 | |||||||
Accounts
payable
|
(137 | ) | (196 | ) | 21 | |||||||
Income
taxes receivable/payable
|
43 | 56 | 28 | |||||||||
Regulatory
balancing accounts, net
|
(394 | ) | (567 | ) | 329 | |||||||
Other
current assets
|
(223 | ) | 170 | (273 | ) | |||||||
Other
current liabilities
|
90 | 24 | (235 | ) | ||||||||
Other
|
(5 | ) | (45 | ) | (13 | ) | ||||||
Net
cash provided by operating activities
|
$ | 2,766 | $ | 2,541 | $ | 2,577 |
●
|
Liabilities
for deferred income taxes and tax credits increased by approximately $593
million in 2008, primarily due to an increase in balancing account
revenues, which are not taxable until billed, as well as an increase in
deductible tax depreciation as authorized by the 2008 Economic Stimulus
Act.
|
●
|
Regulatory
balancing accounts, net under-collection increased by approximately $394
million in 2008, primarily due to an increase of approximately $356
million in under-collected electricity procurement costs and a $108
million decrease in over-collections due to refunds to customers for the
over-collected prior year balance. The 2007 over-collection was
caused by lower than forecasted RMR costs and the receipt of a settlement
payment made in connection with an energy supplier refund
claim. This increase in the Regulatory balancing accounts, net
under-collection was partially offset by a refund of approximately $230
million that the Utility received from the California Energy Commission
(“CEC”). The funds from the CEC will be refunded to customers
in 2009.
|
●
|
Net
collateral paid, primarily related to price risk management activities,
increased by approximately $325 million in 2008 as a result of changes in
the Utility’s exposure to counterparties’ credit risk, generally
reflecting declining natural gas prices. Collateral payables
and receivables are included in Other changes in noncurrent assets and
liabilities, Other current assets, and Other current liabilities in the
table above.
|
●
|
Other
noncurrent assets and liabilities increased by approximately $188 million
primarily due to $159 million of under-spent funds related to the
California Solar Incentive program.
|
●
|
Other
current assets decreased by approximately $170 million primarily due to a
decrease in the cash collateral deposited by counterparties as a result of
changes in the Utility’s exposure to counterparties’ credit
risk.
|
●
|
Regulatory
balancing accounts, net over-collection decreased by approximately $567
million in 2007 primarily due to CPUC-authorized rate reductions designed
to reduce the over-collection.
|
●
|
Accounts
payable decreased by approximately $196 million primarily due to
differences in the timing of purchases and payments of operating
expenses.
|
●
|
Regulatory
balancing accounts, net under-collection decreased by approximately $329
million in 2006, primarily due to lower than forecasted costs associated
with certain power purchase agreements and a decrease related to customer
energy efficiency incentives due to a CPUC decision in October 2005 to set
rates to recover shareholder incentive revenue. These decreases
were offset by a decrease in electricity procurement costs due to the
receipt of cash relating to the Mirant
settlement.
|
●
|
Liabilities
for deferred income taxes and tax credits decreased by approximately $287
million in 2006, primarily due to an increased California franchise tax
deduction, lower taxable supplier settlement income received, and a
deduction related to the payment of previously accrued litigation
costs.
|
●
|
Other
current assets increased by approximately $273 million primarily due to an
increase in the cash collateral deposited by counterparties as a result of
changes in the Utility’s exposure to counterparties’ credit risk,
generally reflecting increasing natural gas prices.
|
●
|
Other
current liabilities decreased by approximately $235 million primarily due
to the settlement of claims related to the alleged exposure to chromium at
the Utility’s natural gas compressor
stations.
|
(in
millions)
|
2008
|
2007
|
2006
|
|||||||||
Capital
expenditures
|
$ | (3,628 | ) | $ | (2,768 | ) | $ | (2,402 | ) | |||
Net
proceeds from sale of assets
|
26 | 21 | 17 | |||||||||
Decrease
in restricted cash
|
36 | 185 | 115 | |||||||||
Proceeds from
nuclear decommissioning trust sales
|
1,635 | 830 | 1,087 | |||||||||
Purchases of
nuclear decommissioning trust investments
|
(1,684 | ) | (933 | ) | (1,244 | ) | ||||||
Other
|
(25 | ) | - | 1 | ||||||||
Net
cash used in investing activities
|
$ | (3,640 | ) | $ | (2,665 | ) | $ | (2,426 | ) |
(in
millions)
|
2008
|
2007
|
2006
|
|||||||||
Borrowings
under accounts receivable facility and revolving credit
facility
|
$ | 533 | $ | 850 | $ | 350 | ||||||
Repayments
under accounts receivable facility and revolving credit
facility
|
(783 | ) | (900 | ) | (310 | ) | ||||||
Net
issuance (repayments) of commercial paper, net of discount of $11 million
in 2008, $1 million in 2007 and $2 million in 2006
|
6 | (209 | ) | 458 | ||||||||
Proceeds
from issuance of long-term debt, net of discount, premium, and issuance
costs of $19 million in 2008 and $16 million in 2007
|
2,185 | 1,184 | - | |||||||||
Long-term
debt repurchased
|
(454 | ) | - | - | ||||||||
Rate
reduction bonds matured
|
- | (290 | ) | (290 | ) | |||||||
Energy
recovery bonds matured
|
(354 | ) | (340 | ) | (316 | ) | ||||||
Preferred
stock dividends paid
|
(14 | ) | (14 | ) | (14 | ) | ||||||
Common
stock dividends paid
|
(568 | ) | (509 | ) | (460 | ) | ||||||
Equity
contribution
|
270 | 400 | - | |||||||||
Other
|
(36 | ) | 23 | 38 | ||||||||
Net
cash provided by (used in) financing activities
|
$ | 785 | $ | 195 | $ | (544 | ) |
Payment
due by period
|
||||||||||||||||||||
(in
millions)
|
Total
|
Less
than 1 year
|
1-3
years
|
3-5
years
|
More
than 5 years
|
|||||||||||||||
Contractual
Commitments:
Utility
|
||||||||||||||||||||
Long-term
debt
(1)
:
|
||||||||||||||||||||
Fixed
rate obligations
|
$ | 17,125 | $ | 1,089 | $ | 1,540 | $ | 1,314 | $ | 13,182 | ||||||||||
Variable
rate obligations
|
954 | 7 | 332 | 615 | - | |||||||||||||||
Energy
recovery bonds
(2)
|
1,742 | 435 | 871 | 436 | - | |||||||||||||||
Purchase
obligations:
|
||||||||||||||||||||
Power
purchase agreements
(3)
:
|
||||||||||||||||||||
Qualifying
facilities
|
12,979 | 1,361 | 2,649 | 2,221 | 6,748 | |||||||||||||||
Renewable
contracts
|
9,779 | 439 | 1,076 | 1,278 | 6,986 | |||||||||||||||
Irrigation
district and water agencies
|
372 | 64 | 135 | 89 | 84 | |||||||||||||||
Other
power purchase agreements
|
1,945 | 275 | 458 | 171 | 1,041 | |||||||||||||||
Natural
gas supply and transportation
|
1,444 | 898 | 298 | 91 | 157 | |||||||||||||||
Nuclear
fuel
|
950 | 95 | 200 | 160 | 495 | |||||||||||||||
Pension
and other benefits
(4)
|
580 | 300 | 280 | - | - | |||||||||||||||
Capital
lease obligations
(5)
|
454 | 50 | 100 | 100 | 204 | |||||||||||||||
Operating
leases
|
123 | 21 | 35 | 33 | 34 | |||||||||||||||
Preferred
dividends
(6)
|
70 | 14 | 28 | 28 | - | |||||||||||||||
Other
commitments
|
24 | 24 | - | - | - | |||||||||||||||
PG&E
Corporation
|
||||||||||||||||||||
Long-term
debt
(1)
:
|
||||||||||||||||||||
Convertible
subordinated notes
|
318 | 27 | 291 | - | - | |||||||||||||||
(1)
Includes interest payments over the terms of the debt. Interest is
calculated using the applicable interest rate at December 31, 2008 and
outstanding principal for each instrument with the terms ending at each
instrument’s maturity. Variable rate obligations consist of bonds,
due in 2016-2026, backed by letters of credit which expire in 2011 and
2012. These bonds are subject to mandatory redemption unless the
letters of credit are extended or replaced or if applicable to the series,
the issuer consents to the continuation of these bonds without a credit
facility. Accordingly, these bonds have been classified for repayment
purposes in 2011 and 2012. (See Note 4 of the Notes to the
Consolidated Financial Statements.)
|
||||||||||||||||||||
(2)
Includes interest payments over the terms of the bonds. (See Note 5
of the Notes to the Consolidated Financial Statements.)
|
||||||||||||||||||||
(3)
This table does not include DWR allocated contracts because the DWR
is legally and financially responsible for these contracts and
payments. (See Note 17 of the Notes to the Consolidated Financial
Statements.)
|
||||||||||||||||||||
(4)
PG&E Corporation’s and the Utility’s funding policy is to contribute
tax-deductible amounts, consistent with applicable regulatory decisions,
sufficient to meet minimum funding requirements. (See Note 14 of the Notes
to the Consolidated Financial Statements.)
|
||||||||||||||||||||
(5)
See Note 17 of the Notes to the Consolidated Financial
Statements.
|
||||||||||||||||||||
(6)
Based on historical performance, it is assumed for purposes of the table
above that dividends are payable within a fixed period of five
years.
|
●
|
periodic
expirations or terminations of existing electricity purchase contracts
including the DWR’s contracts;
|
●
|
the
execution of new electricity purchase contracts;
|
●
|
fluctuation
in the output of hydroelectric and other renewable power facilities owned
or under contract;
|
●
|
changes
in the Utility's customers' electricity demands due to customer and
economic growth or decline, weather, implementation of new energy
efficiency and demand response programs, direct access, and community
choice aggregation;
|
●
|
the
acquisition, retirement or closure of generation facilities;
and
|
●
|
changes
in market prices that make it more economical to purchase power in the
market rather than use the Utility’s existing
resources.
|
●
|
Decommissioning costs
-
The estimated costs for labor, equipment, material, and other disposal
costs;
|
●
|
Inflation adjustment
-
The estimated cash flows are adjusted for inflation
estimates;
|
●
|
Discount rate
- The
fair value of the obligation is based on a credit-adjusted risk free rate
that reflects the risk associated with the obligation;
and
|
●
|
Third-party mark-up
adjustments
- Internal labor costs included in the cash flow
calculation were adjusted for costs that a third party would incur in
performing the tasks necessary to retire the asset in accordance with SFAS
No. 143.
|
●
|
Estimated date of
decommissioning
- The fair value of the obligation will change
based on the expected date of
decommissioning.
|
(in
millions)
|
Increase
(decrease)
in Assumption
|
Increase
in 2008 Pension Costs
|
Increase
in Projected Benefit Obligation at December 31, 2008
|
|||||||||
Discount
rate
|
(0.5 | )% | $ | 15 | $ | 667 | ||||||
Rate
of return on plan assets
|
(0.5 | )% | 47 | - | ||||||||
Rate
of increase in compensation
|
0.5 | % | 17 | 162 |
(in
millions)
|
Increase
(decrease)
in Assumption
|
Increase
in 2008
Other
Postretirement Benefit Costs
|
Increase
in Accumulated Benefit Obligation at December 31,
2008
|
|||||||||
Health
care cost trend rate
|
0.5 | % | $ | 6 | $ | 33 | ||||||
Discount
rate
|
(0.5 | )% | 6 | 75 |
Value
as of
|
||||||||
(in
millions)
|
December
31, 2008
|
January
1, 2008
|
||||||
Money
market investments (held by PG&E Corporation)
|
$ | 12 | $ | - | ||||
Nuclear
decommissioning trusts
|
5 | 8 | ||||||
Price
risk management instruments
|
(156 | ) | 115 | |||||
Long
term disability trust
|
78 | 87 | ||||||
Dividend
participation rights
|
(42 | ) | (68 | ) | ||||
Other
|
(2 | ) | (4 | ) | ||||
Total
Level 3 Instruments
|
$ | (105 | ) | $ | 138 |
Value
(in millions)
|
||||||||
Type
of Instrument
|
December
31, 2008
|
January
1,
2008
|
||||||
Options
(exchange-traded and OTC)
|
$ | 28 | $ | 50 | ||||
Congestion
revenue rights, Firm transmission rights, and Demand response
contracts
|
99 | 61 | ||||||
Swaps
and forwards
|
(366 | ) | (2 | ) | ||||
Netting
and collateral
|
83 | 6 | ||||||
Total
|
$ | (156 | ) | $ | 115 |
●
|
weather;
|
●
|
supply
and demand;
|
●
|
the
availability of competitively priced alternative energy
sources;
|
●
|
the
level of production of natural gas;
|
●
|
the
availability of nuclear fuel;
|
●
|
the
availability of LNG supplies;
|
●
|
the
price of fuels that are used to produce electricity, including natural
gas, crude oil, coal and nuclear
materials;
|
●
|
the
transparency, efficiency, integrity and liquidity of regional energy
markets affecting California;
|
●
|
electricity
transmission or natural gas transportation capacity
constraints;
|
●
|
federal,
state, and local energy and environmental regulation and legislation;
and
|
●
|
natural
disasters, war, terrorism, and other catastrophic
events.
|
●
|
operating
limitations that may be imposed by environmental laws or regulations,
including those relating to greenhouse gases, or other regulatory
requirements;
|
●
|
imposition
of stricter operational performance standards by agencies with regulatory
oversight of the Utility's facilities;
|
●
|
environmental
accidents, including the release of hazardous or toxic substances into the
air or water, urban wildfires and other events caused by operation of the
Utility’s facilities or equipment failure;
|
●
|
fuel
supply interruptions;
|
●
|
equipment
failure;
|
●
|
failure
of the Utility’s computer information systems, including those relating to
operations or financial information such as customer
billing;
|
●
|
labor
disputes, workforce shortage, and availability of qualified
personnel;
|
●
|
weather,
storms, earthquakes, wild land and other fires, floods or other natural
disasters, war, pandemic and other catastrophic
events;
|
●
|
explosions,
accidents, dam failure, mechanical breakdowns, and terrorist activities;
and
|
●
|
other
events or hazards.
|
Year
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Operating
Revenues
|
||||||||||||
Electric
|
$ | 10,738 | $ | 9,480 | $ | 8,752 | ||||||
Natural
gas
|
3,890 | 3,757 | 3,787 | |||||||||
Total
operating revenues
|
14,628 | 13,237 | 12,539 | |||||||||
Operating
Expenses
|
||||||||||||
Cost
of electricity
|
4,425 | 3,437 | 2,922 | |||||||||
Cost
of natural gas
|
2,090 | 2,035 | 2,097 | |||||||||
Operating
and maintenance
|
4,201 | 3,881 | 3,703 | |||||||||
Depreciation,
amortization, and decommissioning
|
1,651 | 1,770 | 1,709 | |||||||||
Total
operating expenses
|
12,367 | 11,123 | 10,431 | |||||||||
Operating
Income
|
2,261 | 2,114 | 2,108 | |||||||||
Interest
income
|
94 | 164 | 188 | |||||||||
Interest
expense
|
(728 | ) | (762 | ) | (738 | ) | ||||||
Other
income (expense), net
|
(18 | ) | 29 | (13 | ) | |||||||
Income
Before Income Taxes
|
1,609 | 1,545 | 1,545 | |||||||||
Income
tax provision
|
425 | 539 | 554 | |||||||||
Income
From Continuing Operations
|
1,184 | 1,006 | 991 | |||||||||
Discontinued
Operations
|
||||||||||||
NEGT
income tax benefit
|
154 | - | - | |||||||||
Net
Income
|
$ | 1,338 | $ | 1,006 | $ | 991 | ||||||
Weighted
Average Common Shares Outstanding, Basic
|
357 | 351 | 346 | |||||||||
Weighted
Average Common Shares Outstanding, Diluted
|
358 | 353 | 349 | |||||||||
Earnings
Per Common Share from Continuing Operations, Basic
|
$ | 3.23 | $ | 2.79 | $ | 2.78 | ||||||
Net
Earnings Per Common Share, Basic
|
$ | 3.64 | $ | 2.79 | $ | 2.78 | ||||||
Earnings
Per Common Share from Continuing Operations, Diluted
|
$ | 3.22 | $ | 2.78 | $ | 2.76 | ||||||
Net
Earnings Per Common Share, Diluted
|
$ | 3.63 | $ | 2.78 | $ | 2.76 | ||||||
Dividends
Declared Per Common Share
|
$ | 1.56 | $ | 1.44 | $ | 1.32 |
Balance
at December 31,
|
||||||||
2008
|
2007
|
|||||||
ASSETS
|
||||||||
Current
Assets
|
||||||||
Cash
and cash equivalents
|
$ | 219 | $ | 345 | ||||
Restricted
cash
|
1,290 | 1,297 | ||||||
Accounts
receivable:
|
||||||||
Customers
(net of allowance for doubtful accounts of $76 million in 2008 and $58
million in 2007)
|
1,751 | 1,599 | ||||||
Accrued
unbilled revenue
|
685 | 750 | ||||||
Regulatory
balancing accounts
|
1,197 | 771 | ||||||
Inventories:
|
||||||||
Gas
stored underground and fuel oil
|
232 | 205 | ||||||
Materials
and supplies
|
191 | 166 | ||||||
Income
taxes receivable
|
120 | 61 | ||||||
Prepaid
expenses and other
|
718 | 255 | ||||||
Total
current assets
|
6,403 | 5,449 | ||||||
Property,
Plant, and Equipment
|
||||||||
Electric
|
27,638 | 25,599 | ||||||
Gas
|
10,155 | 9,620 | ||||||
Construction
work in progress
|
2,023 | 1,348 | ||||||
Other
|
17 | 17 | ||||||
Total
property, plant, and equipment
|
39,833 | 36,584 | ||||||
Accumulated
depreciation
|
(13,572 | ) | (12,928 | ) | ||||
Net
property, plant, and equipment
|
26,261 | 23,656 | ||||||
Other
Noncurrent Assets
|
||||||||
Regulatory
assets
|
5,996 | 4,459 | ||||||
Nuclear
decommissioning funds
|
1,718 | 1,979 | ||||||
Other
|
482 | 1,089 | ||||||
Total
other noncurrent assets
|
8,196 | 7,527 | ||||||
TOTAL
ASSETS
|
$ | 40,860 | $ | 36,632 |
Balance
at December 31,
|
||||||||
2008
|
2007
|
|||||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||||||||
Current
Liabilities
|
||||||||
Short-term
borrowings
|
$ | 287 | $ | 519 | ||||
Long-term
debt, classified as current
|
600 | - | ||||||
Energy
recovery bonds, classified as current
|
370 | 354 | ||||||
Accounts
payable:
|
||||||||
Trade
creditors
|
1,096 | 1,067 | ||||||
Disputed
claims and customer refunds
|
1,580 | 1,629 | ||||||
Regulatory
balancing accounts
|
730 | 673 | ||||||
Other
|
343 | 394 | ||||||
Interest
payable
|
802 | 697 | ||||||
Deferred
income taxes
|
251 | - | ||||||
Other
|
1,567 | 1,374 | ||||||
Total
current liabilities
|
7,626 | 6,707 | ||||||
Noncurrent
Liabilities
|
||||||||
Long-term
debt
|
9,321 | 8,171 | ||||||
Energy
recovery bonds
|
1,213 | 1,582 | ||||||
Regulatory
liabilities
|
3,657 | 4,448 | ||||||
Pension
and other postretirement benefits
|
2,088 | - | ||||||
Asset
retirement obligations
|
1,684 | 1,579 | ||||||
Income
taxes payable
|
35 | 234 | ||||||
Deferred
income taxes
|
3,397 | 3,053 | ||||||
Deferred
tax credits
|
94 | 99 | ||||||
Other
|
2,116 | 1,954 | ||||||
Total
noncurrent liabilities
|
23,605 | 21,120 | ||||||
Commitments
and Contingencies
|
||||||||
Preferred
Stock of Subsidiaries
|
252 | 252 | ||||||
Preferred
Stock
|
||||||||
Preferred
stock, no par value, authorized 80,000,000 shares, $100 par value,
authorized 5,000,000 shares, none issued
|
- | - | ||||||
Common
Shareholders' Equity
|
||||||||
Common
stock, no par value, authorized 800,000,000 shares, issued 361,059,116
common and 1,287,569 restricted shares in 2008 and issued 378,385,151
common and 1,261,125 restricted shares in 2007
|
5,984 | 6,110 | ||||||
Common
stock held by subsidiary, at cost, 24,665,500 shares in
2007
|
- | (718 | ) | |||||
Reinvested
earnings
|
3,614 | 3,151 | ||||||
Accumulated
other comprehensive income (loss)
|
(221 | ) | 10 | |||||
Total
common shareholders' equity
|
9,377 | 8,553 | ||||||
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$ | 40,860 | $ | 36,632 |
Year
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Cash
Flows From Operating Activities
|
||||||||||||
Net
income
|
$ | 1,338 | $ | 1,006 | $ | 991 | ||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||
Depreciation,
amortization, and decommissioning
|
1,863 | 1,959 | 1,803 | |||||||||
Allowance
for equity funds used during construction
|
(70 | ) | (64 | ) | (47 | ) | ||||||
Gain
on sale of assets
|
(1 | ) | (1 | ) | (11 | ) | ||||||
Deferred
income taxes and tax credits, net
|
590 | 55 | (285 | ) | ||||||||
Other
changes in noncurrent assets and liabilities
|
(126 | ) | 192 | 151 | ||||||||
Effect
of changes in operating assets and liabilities:
|
||||||||||||
Accounts
receivable
|
(87 | ) | (6 | ) | 130 | |||||||
Inventories
|
(59 | ) | (41 | ) | 32 | |||||||
Accounts
payable
|
(140 | ) | (178 | ) | 17 | |||||||
Income
taxes receivable/payable
|
(59 | ) | 56 | 124 | ||||||||
Regulatory
balancing accounts, net
|
(394 | ) | (567 | ) | 329 | |||||||
Other
current assets
|
(221 | ) | 172 | (273 | ) | |||||||
Other
current liabilities
|
120 | 8 | (233 | ) | ||||||||
Other
|
(5 | ) | (45 | ) | (14 | ) | ||||||
Net
cash provided by operating activities
|
2,749 | 2,546 | 2,714 | |||||||||
Cash
Flows From Investing Activities
|
||||||||||||
Capital
expenditures
|
(3,628 | ) | (2,769 | ) | (2,402 | ) | ||||||
Net
proceeds from sale of assets
|
26 | 21 | 17 | |||||||||
Decrease
in restricted cash
|
36 | 185 | 115 | |||||||||
Proceeds from
nuclear decommissioning trust sales
|
1,635 | 830 | 1,087 | |||||||||
Purchases of
nuclear decommissioning trust investments
|
(1,684 | ) | (933 | ) | (1,244 | ) | ||||||
Other
|
(37 | ) | - | - | ||||||||
Net
cash used in investing activities
|
(3,652 | ) | (2,666 | ) | (2,427 | ) | ||||||
Cash
Flows From Financing Activities
|
||||||||||||
Borrowings
under accounts receivable facility and revolving credit
facility
|
533 | 850 | 350 | |||||||||
Repayments
under accounts receivable facility and revolving credit
facility
|
(783 | ) | (900 | ) | (310 | ) | ||||||
Net
issuance (repayments) of commercial paper, net of discount of $11 million
in 2008, $1 million in 2007 and $2 million in 2006
|
6 | (209 | ) | 458 | ||||||||
Proceeds
from issuance of long-term debt, net of discount, premium and issuance
costs of $19 million in 2008 and $16 million in 2007
|
2,185 | 1,184 | - | |||||||||
Long-term
debt repurchased
|
(454 | ) | - | - | ||||||||
Rate
reduction bonds matured
|
- | (290 | ) | (290 | ) | |||||||
Energy
recovery bonds matured
|
(354 | ) | (340 | ) | (316 | ) | ||||||
Common
stock issued
|
225 | 175 | 131 | |||||||||
Common
stock repurchased
|
- | - | (114 | ) | ||||||||
Common
stock dividends paid
|
(546 | ) | (496 | ) | (456 | ) | ||||||
Other
|
(35 | ) | 35 | 3 | ||||||||
Net
cash provided by (used in) financing activities
|
777 | 9 | (544 | ) | ||||||||
Net
change in cash and cash equivalents
|
(126 | ) | (111 | ) | (257 | ) | ||||||
Cash
and cash equivalents at January 1
|
345 | 456 | 713 | |||||||||
Cash
and cash equivalents at December 31
|
$ | 219 | $ | 345 | $ | 456 | ||||||
Supplemental
disclosures of cash flow information
|
||||||||||||
Cash
paid (received) for:
|
||||||||||||
Interest
(net of amounts capitalized)
|
$ | 523 | $ | 514 | $ | 503 | ||||||
Income
taxes, net
|
(112 | ) | 537 | 736 |
Supplemental
disclosures of noncash investing and financing activities
|
||||||||||||
Common
stock dividends declared but not yet paid
|
$ | 143 | $ | 129 | $ | 117 | ||||||
Capital
expenditures financed through accounts payable
|
348 | 279 | 215 | |||||||||
Stock
issued in lieu of dividend
|
20 | 5 | - | |||||||||
Assumption
of capital lease obligation
|
- | - | 408 | |||||||||
Transfer
of Gateway Generating Station asset
|
- | - | 69 |
Common
Stock Shares
|
Common
Stock Amount
|
Common
Stock Held by
Subsidiary
|
Unearned
Compensation
|
Reinvested
Earnings
|
Accumulated
Other Comprehensive Income (Loss)
|
Total
Common Share-holders' Equity
|
Comprehensive
Income
|
|||||||||||||||||||||||||
Balance
at December 31, 2005
|
368,268,502 | $ | 5,827 | $ | (718 | ) | $ | (22 | ) | $ | 2,139 | $ | (8 | ) | $ | 7,218 | ||||||||||||||||
Net
income
|
- | - | - | - | 991 | - | 991 | $ | 991 | |||||||||||||||||||||||
Comprehensive
income
|
$ | 991 | ||||||||||||||||||||||||||||||
Common
stock issued
|
5,399,707 | 110 | - | - | - | - | 110 | |||||||||||||||||||||||||
Accelerated
share repurchase settlement of stock repurchased in 2005
|
- | (114 | ) | - | - | - | - | (114 | ) | |||||||||||||||||||||||
Common
stock warrants exercised
|
51,890 | - | - | - | - | - | - | |||||||||||||||||||||||||
Common
restricted stock, unearned compensation reversed in accordance with SFAS
No. 123R
|
- | (22 | ) | - | 22 | - | - | - | ||||||||||||||||||||||||
Common
restricted stock issued
|
566,255 | 21 | - | - | - | - | 21 | |||||||||||||||||||||||||
Common
restricted stock cancelled
|
(105,295 | ) | (1 | ) | - | - | - | - | (1 | ) | ||||||||||||||||||||||
Common
restricted stock amortization
|
- | 20 | - | - | - | - | 20 | |||||||||||||||||||||||||
Common
stock dividends declared and paid
|
- | - | - | - | (342 | ) | - | (342 | ) | |||||||||||||||||||||||
Common
stock dividends declared but not yet paid
|
- | - | - | - | (117 | ) | - | (117 | ) | |||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | 35 | - | - | - | - | 35 | |||||||||||||||||||||||||
Adoption
of SFAS No. 158 (net of income tax benefit of $8 million)
|
- | - | - | - | - | (11 | ) | (11 | ) | |||||||||||||||||||||||
Other
|
- | 1 | - | - | - | - | 1 | |||||||||||||||||||||||||
Balance
at December 31, 2006
|
374,181,059 | 5,877 | (718 | ) | - | 2,671 | (19 | ) | 7,811 |
Net
income
|
- | - | - | - | 1,006 | - | 1,006 | $ | 1,006 | |||||||||||||||||||||||
Employee
benefit plan adjustment in accordance with SFAS No. 158 (net of income tax
expense of $17 million)
|
- | - | - | - | - | 29 | 29 | 29 | ||||||||||||||||||||||||
Comprehensive
income
|
$ | 1,035 | ||||||||||||||||||||||||||||||
Common
stock issued, net
|
5,465,217 | 175 | - | - | - | - | 175 | |||||||||||||||||||||||||
Stock-based
compensation amortization
|
- | 31 | - | - | - | - | 31 | |||||||||||||||||||||||||
Common
stock dividends declared and paid
|
- | - | - | - | (379 | ) | - | (379 | ) | |||||||||||||||||||||||
Common
stock dividends declared but not yet paid
|
- | - | - | - | (129 | ) | - | (129 | ) | |||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | 27 | - | - | - | - | 27 | |||||||||||||||||||||||||
Adoption
of FIN 48
|
- | - | - | - | (18 | ) | - | (18 | ) | |||||||||||||||||||||||
Balance
at December 31, 2007
|
379,646,276 | 6,110 | (718 | ) | - | 3,151 | 10 | 8,553 |
Net
income
|
- | - | - | - | 1,338 | - | 1,338 | $ | 1,338 | |||||||||||||||||||||||
Employee
benefit plan adjustment in accordance with SFAS No. 158 (net of income tax
benefit of $156 million)
|
(231 | ) | (231 | ) | (231 | ) | ||||||||||||||||||||||||||
Comprehensive
income
|
$ | 1,107 | ||||||||||||||||||||||||||||||
Common
stock issued, net
|
7,365,909 | 247 | - | - | - | - | 247 | |||||||||||||||||||||||||
Common
stock cancelled
|
(24,665,500 | ) | (403 | ) | 718 | - | (315 | ) | - | - | ||||||||||||||||||||||
Stock-based
compensation amortization
|
- | 24 | - | - | - | - | 24 | |||||||||||||||||||||||||
Common
stock dividends declared and paid
|
- | - | - | - | (417 | ) | - | (417 | ) | |||||||||||||||||||||||
Common
stock dividends declared but not yet paid
|
- | - | - | - | (143 | ) | - | (143 | ) | |||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | 6 | - | - | - | - | 6 | |||||||||||||||||||||||||
Balance
at December 31, 2008
|
362,346,685 | $ | 5,984 | $ | - | $ | - | $ | 3,614 | $ | (221 | ) | $ | 9,377 |
Year
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Operating
Revenues
|
||||||||||||
Electric
|
$ | 10,738 | $ | 9,481 | $ | 8,752 | ||||||
Natural
gas
|
3,890 | 3,757 | 3,787 | |||||||||
Total
operating revenues
|
14,628 | 13,238 | 12,539 | |||||||||
Operating
Expenses
|
||||||||||||
Cost
of electricity
|
4,425 | 3,437 | 2,922 | |||||||||
Cost
of natural gas
|
2,090 | 2,035 | 2,097 | |||||||||
Operating
and maintenance
|
4,197 | 3,872 | 3,697 | |||||||||
Depreciation,
amortization and decommissioning
|
1,650 | 1,769 | 1,708 | |||||||||
Total
operating expenses
|
12,362 | 11,113 | 10,424 | |||||||||
Operating
Income
|
2,266 | 2,125 | 2,115 | |||||||||
Interest
income
|
91 | 150 | 175 | |||||||||
Interest
expense
|
(698 | ) | (732 | ) | (710 | ) | ||||||
Other
income, net
|
28 | 52 | 7 | |||||||||
Income
Before Income Taxes
|
1,687 | 1,595 | 1,587 | |||||||||
Income
tax provision
|
488 | 571 | 602 | |||||||||
Net
Income
|
1,199 | 1,024 | 985 | |||||||||
Preferred
stock dividend requirement
|
14 | 14 | 14 | |||||||||
Income
Available for Common Stock
|
$ | 1,185 | $ | 1,010 | $ | 971 |
Balance
At December 31,
|
||||||||
2008
|
2007
|
|||||||
ASSETS
|
||||||||
Current
Assets
|
||||||||
Cash
and cash equivalents
|
$ | 52 | $ | 141 | ||||
Restricted
cash
|
1,290 | 1,297 | ||||||
Accounts
receivable:
|
||||||||
Customers
(net of allowance for doubtful accounts of $76 million in 2008 and $58
million in 2007)
|
1,751 | 1,599 | ||||||
Accrued
unbilled revenue
|
685 | 750 | ||||||
Related
parties
|
2 | 6 | ||||||
Regulatory
balancing accounts
|
1,197 | 771 | ||||||
Inventories:
|
||||||||
Gas
stored underground and fuel oil
|
232 | 205 | ||||||
Materials
and supplies
|
191 | 166 | ||||||
Income
taxes receivable
|
25 | 15 | ||||||
Prepaid
expenses and other
|
705 | 252 | ||||||
Total
current assets
|
6,130 | 5,202 | ||||||
Property,
Plant, and Equipment
|
||||||||
Electric
|
27,638 | 25,599 | ||||||
Gas
|
10,155 | 9,620 | ||||||
Construction
work in progress
|
2,023 | 1,348 | ||||||
Total
property, plant, and equipment
|
39,816 | 36,567 | ||||||
Accumulated
depreciation
|
(13,557 | ) | (12,913 | ) | ||||
Net
property, plant, and equipment
|
26,259 | 23,654 | ||||||
Other
Noncurrent Assets
|
||||||||
Regulatory
assets
|
5,996 | 4,459 | ||||||
Nuclear
decommissioning funds
|
1,718 | 1,979 | ||||||
Related
parties receivable
|
27 | 23 | ||||||
Other
|
407 | 993 | ||||||
Total
other noncurrent assets
|
8,148 | 7,454 | ||||||
TOTAL
ASSETS
|
$ | 40,537 | $ | 36,310 |
Balance
at December 31,
|
||||||||
2008
|
2007
|
|||||||
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
||||||||
Current
Liabilities
|
||||||||
Short-term
borrowings
|
$ | 287 | $ | 519 | ||||
Long-term
debt, classified as current
|
600 | - | ||||||
Energy
recovery bonds, classified as current
|
370 | 354 | ||||||
Accounts
payable:
|
||||||||
Trade
creditors
|
1,096 | 1,067 | ||||||
Disputed
claims and customer refunds
|
1,580 | 1,629 | ||||||
Related
parties
|
25 | 28 | ||||||
Regulatory
balancing accounts
|
730 | 673 | ||||||
Other
|
325 | 370 | ||||||
Interest
payable
|
802 | 697 | ||||||
Income
tax payable
|
53 | - | ||||||
Deferred
income taxes
|
257 | 4 | ||||||
Other
|
1,371 | 1,200 | ||||||
Total
current liabilities
|
7,496 | 6,541 | ||||||
Noncurrent
Liabilities
|
||||||||
Long-term
debt
|
9,041 | 7,891 | ||||||
Energy
recovery bonds
|
1,213 | 1,582 | ||||||
Regulatory
liabilities
|
3,657 | 4,448 | ||||||
Pension
and other postretirement benefits
|
2,040 | - | ||||||
Asset
retirement obligations
|
1,684 | 1,579 | ||||||
Income
taxes payable
|
12 | 103 | ||||||
Deferred
income taxes
|
3,449 | 3,104 | ||||||
Deferred
tax credits
|
94 | 99 | ||||||
Other
|
2,064 | 1,838 | ||||||
Total
noncurrent liabilities
|
23,254 | 20,644 | ||||||
Commitments
and Contingencies
|
||||||||
Shareholders'
Equity
|
||||||||
Preferred
stock without mandatory redemption provisions:
|
||||||||
Nonredeemable,
5.00% to 6.00%, outstanding 5,784,825 shares
|
145 | 145 | ||||||
Redeemable,
4.36% to 5.00%, outstanding 4,534,958 shares
|
113 | 113 | ||||||
Common
stock, $5 par value, authorized 800,000,000 shares, issued 264,374,809
shares in 2008 and issued 282,916,485 shares in 2007
|
1,322 | 1,415 | ||||||
Common
stock held by subsidiary, at cost, 19,481,213 shares in
2007
|
- | (475 | ) | |||||
Additional
paid-in capital
|
2,331 | 2,220 | ||||||
Reinvested
earnings
|
6,092 | 5,694 | ||||||
Accumulated
other comprehensive income (loss)
|
(216 | ) | 13 | |||||
Total
shareholders' equity
|
9,787 | 9,125 | ||||||
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$ | 40,537 | $ | 36,310 |
Year
ended December 31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
Cash Flows From Operating
Activities
|
||||||||||||
Net
income
|
$ | 1,199 | $ | 1,024 | $ | 985 | ||||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||||||
Depreciation,
amortization, and decommissioning
|
1,838 | 1,956 | 1,802 | |||||||||
Allowance
for equity funds used during construction
|
(70 | ) | (64 | ) | (47 | ) | ||||||
Gain
on sale of assets
|
(1 | ) | (1 | ) | (11 | ) | ||||||
Deferred
income taxes and tax credits, net
|
593 | 43 | (287 | ) | ||||||||
Other
changes in noncurrent assets and liabilities
|
(25 | ) | 188 | 116 | ||||||||
Effect
of changes in operating assets and liabilities:
|
||||||||||||
Accounts
receivable
|
(83 | ) | (6 | ) | 128 | |||||||
Inventories
|
(59 | ) | (41 | ) | 34 | |||||||
Accounts
payable
|
(137 | ) | (196 | ) | 21 | |||||||
Income
taxes receivable/payable
|
43 | 56 | 28 | |||||||||
Regulatory
balancing accounts, net
|
(394 | ) | (567 | ) | 329 | |||||||
Other
current assets
|
(223 | ) | 170 | (273 | ) | |||||||
Other
current liabilities
|
90 | 24 | (235 | ) | ||||||||
Other
|
(5 | ) | (45 | ) | (13 | ) | ||||||
Net
cash provided by operating activities
|
2,766 | 2,541 | 2,577 | |||||||||
Cash Flows From Investing
Activities
|
||||||||||||
Capital
expenditures
|
(3,628 | ) | (2,768 | ) | (2,402 | ) | ||||||
Net
proceeds from sale of assets
|
26 | 21 | 17 | |||||||||
Decrease
in restricted cash
|
36 | 185 | 115 | |||||||||
Proceeds from
nuclear decommissioning trust sales
|
1,635 | 830 | 1,087 | |||||||||
Purchases of
nuclear decommissioning trust investments
|
(1,684 | ) | (933 | ) | (1,244 | ) | ||||||
Other
|
(25 | ) | - | 1 | ||||||||
Net
cash used in investing activities
|
(3,640 | ) | (2,665 | ) | (2,426 | ) | ||||||
Cash Flows From Financing
Activities
|
||||||||||||
Borrowings
under accounts receivable facility and revolving credit
facility
|
533 | 850 | 350 | |||||||||
Repayments
under accounts receivable facility and revolving credit
facility
|
(783 | ) | (900 | ) | (310 | ) | ||||||
Net
issuance (repayments) of commercial paper, net of discount of $11 million
in 2008, $1 million in 2007 and $2 million in 2006
|
6 | (209 | ) | 458 | ||||||||
Proceeds
from issuance of long-term debt, net of discount, premium and issuance
costs of $19 million in 2008 and $16 million in 2007
|
2,185 | 1,184 | - | |||||||||
Long-term
debt repurchased
|
(454 | ) | - | - | ||||||||
Rate
reduction bonds matured
|
- | (290 | ) | (290 | ) | |||||||
Energy
recovery bonds matured
|
(354 | ) | (340 | ) | (316 | ) | ||||||
Preferred
stock dividends paid
|
(14 | ) | (14 | ) | (14 | ) | ||||||
Common
stock dividends paid
|
(568 | ) | (509 | ) | (460 | ) | ||||||
Equity
contribution
|
270 | 400 | - | |||||||||
Other
|
(36 | ) | 23 | 38 | ||||||||
Net
cash provided by (used in) financing activities
|
785 | 195 | (544 | ) | ||||||||
Net
change in cash and cash equivalents
|
(89 | ) | 71 | (393 | ) | |||||||
Cash
and cash equivalents at January 1
|
141 | 70 | 463 | |||||||||
Cash
and cash equivalents at December 31
|
$ | 52 | $ | 141 | $ | 70 |
Supplemental disclosures of
cash flow information
|
||||||||||||
Cash
paid (received) for:
|
||||||||||||
Interest
(net of amounts capitalized)
|
$ | 496 | $ | 474 | $ | 476 | ||||||
Income
taxes, net
|
(95 | ) | 594 | 897 | ||||||||
Supplemental disclosures of
noncash investing and financing activities
|
||||||||||||
Capital
expenditures financed through accounts payable
|
$ | 348 | $ | 279 | $ | 215 | ||||||
Assumption
of capital lease obligation
|
- | - | 408 | |||||||||
Transfer
of Gateway Generating Station asset
|
- | - | 69 |
Preferred
Stock Without Mandatory Redemption Provisions
|
Common
Stock
|
Additional
Paid-in Capital
|
Common
Stock Held by Subsidiary
|
Reinvested
Earnings
|
Accumulated
Other Comprehensive Income (Loss)
|
Total
Share- holders' Equity
|
Comprehensive
Income
|
|||||||||||||||||||||||||
Balance
at December 31, 2005
|
$ | 258 | $ | 1,398 | $ | 1,776 | $ | (475 | ) | $ | 4,702 | $ | (9 | ) | $ | 7,650 | ||||||||||||||||
Net
income
|
- | - | - | - | 985 | - | 985 | $ | 985 | |||||||||||||||||||||||
Minimum
pension liability adjustment (net of income tax expense of $2
million)
|
- | - | - | - | - | 3 | 3 | 3 | ||||||||||||||||||||||||
Comprehensive
income
|
$ | 988 | ||||||||||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | - | 46 | - | - | - | 46 | |||||||||||||||||||||||||
Common
stock dividend
|
- | - | - | - | (460 | ) | - | (460 | ) | |||||||||||||||||||||||
Preferred
stock dividend
|
- | - | - | - | (14 | ) | - | (14 | ) | |||||||||||||||||||||||
Adoption
of SFAS No. 158 (net of income tax benefit of $7 million)
|
- | - | - | - | - | (10 | ) | (10 | ) | |||||||||||||||||||||||
Balance
at December 31, 2006
|
258 | 1,398 | 1,822 | (475 | ) | 5,213 | (16 | ) | 8,200 | |||||||||||||||||||||||
Net
income
|
- | - | - | - | 1,024 | - | 1,024 | $ | 1,024 | |||||||||||||||||||||||
Employee
benefit plan adjustment in accordance with SFAS No. 158 (net of income tax
expense of $17 million)
|
- | - | - | - | - | 29 | 29 | 29 | ||||||||||||||||||||||||
Comprehensive
income
|
$ | 1,053 | ||||||||||||||||||||||||||||||
Equity
contribution
|
- | 17 | 383 | - | - | - | 400 | |||||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | - | 15 | - | - | - | 15 | |||||||||||||||||||||||||
Common
stock dividend
|
- | - | - | - | (509 | ) | - | (509 | ) | |||||||||||||||||||||||
Preferred
stock dividend
|
- | - | - | - | (14 | ) | - | (14 | ) | |||||||||||||||||||||||
Adoption
of FIN 48
|
- | - | - | - | (20 | ) | - | (20 | ) | |||||||||||||||||||||||
Balance
at December 31, 2007
|
258 | 1,415 | 2,220 | (475 | ) | 5,694 | 13 | 9,125 |
Net
income
|
- | - | - | - | 1,199 | - | 1,199 | $ | 1,199 | |||||||||||||||||||||||
Employee
benefit plan adjustment in accordance with SFAS No. 158 (net of income tax
expense of $159 million)
|
- | - | - | - | - | (229 | ) | (229 | ) | (229 | ) | |||||||||||||||||||||
Comprehensive
income
|
$ | 970 | ||||||||||||||||||||||||||||||
Equity
contribution
|
- | 4 | 266 | - | - | - | 270 | |||||||||||||||||||||||||
Tax
benefit from employee stock plans
|
- | - | 4 | - | - | - | 4 | |||||||||||||||||||||||||
Common
stock dividend
|
- | - | - | - | (568 | ) | - | (568 | ) | |||||||||||||||||||||||
Common
stock cancelled
|
- | (97 | ) | (159 | ) | 475 | (219 | ) | - | - | ||||||||||||||||||||||
Preferred
stock dividend
|
- | - | - | - | (14 | ) | - | (14 | ) | |||||||||||||||||||||||
Balance
at December 31, 2008
|
$ | 258 | $ | 1,322 | $ | 2,331 | $ | - | $ | 6,092 | $ | (216 | ) | $ | 9,787 |
(in
millions)
|
Gross
Plant as of December 31, 2008
|
Accumulated
Depreciation as of December 31, 2008
|
Net
Plant as of December 31, 2008
|
|||||||||
Electricity
generating facilities
|
$ | 3,711 | $ | (1,134 | ) | $ | 2,577 | |||||
Electricity
distribution facilities
|
18,777 | (6,722 | ) | 12,055 | ||||||||
Electricity
transmission
|
5,150 | (1,675 | ) | 3,475 | ||||||||
Natural
gas distribution facilities
|
6,666 | (2,544 | ) | 4,122 | ||||||||
Natural
gas transportation
|
3,434 | (1,482 | ) | 1,952 | ||||||||
Natural
gas storage
|
55 | - | 55 | |||||||||
CWIP
|
2,023 | - | 2,023 | |||||||||
Total
|
$ | 39,816 | $ | (13,557 | ) | $ | 26,259 |
(in
millions)
|
Gross
Plant as of December 31, 2007
|
Accumulated
Depreciation as of December 31, 2007
|
Net
Plant as of December 31, 2007
|
|||||||||
Electricity
generating facilities
|
$ | 3,004 | $ | (1,040 | ) | $ | 1,964 | |||||
Electricity
distribution facilities
|
17,712 | (6,377 | ) | 11,335 | ||||||||
Electricity
transmission
|
4,883 | (1,633 | ) | 3,250 | ||||||||
Natural
gas distribution facilities
|
6,302 | (2,429 | ) | 3,873 | ||||||||
Natural
gas transportation
|
3,271 | (1,434 | ) | 1,837 | ||||||||
Natural
gas storage
|
47 | - | 47 | |||||||||
CWIP
|
1,348 | - | 1,348 | |||||||||
Total
|
$ | 36,567 | $ | (12,913 | ) | $ | 23,654 |
Estimated
Useful Lives
|
|
Electricity
generating facilities
|
4
to 37 years
|
Electricity
distribution facilities
|
16
to 58 years
|
Electricity
transmission
|
40
to 70 years
|
Natural
gas distribution facilities
|
24
to 52 years
|
Natural
gas transportation
|
25
to 45 years
|
Natural
gas storage
|
25
to 48 years
|
(in
millions)
|
||||
ARO
liability at December 31, 2006
|
$ | 1,466 | ||
Revision
in estimated cash flows
|
48 | |||
Accretion
|
95 | |||
Liabilities
settled
|
(30 | ) | ||
ARO
liability at December 31, 2007
|
1,579 | |||
Revision
in estimated cash flows
|
50 | |||
Accretion
|
106 | |||
Liabilities
settled
|
(51 | ) | ||
ARO
liability at December 31, 2008
|
$ | 1,684 |
Minimum
Pension Liability Adjustment
|
Adoption
of SFAS No. 158
|
Employee
Benefit Plan Adjustment in Accordance with SFAS No.
158
|
Accumulated
Other Comprehensive Income (Loss)
|
|||||||||||||
Balance
at
December
31, 2005
|
$ | (8 | ) | $ | - | $ | - | $ | (8 | ) | ||||||
Period
change in:
|
||||||||||||||||
Adoption
of SFAS No. 158 (net of income tax benefit of $8 million)
|
8 | (19 | ) | - | (11 | ) | ||||||||||
Balance
at
December
31, 2006
|
$ | - | $ | (19 | ) | $ | - | $ | (19 | ) | ||||||
Period
change in pension benefits and other benefits:
|
||||||||||||||||
Unrecognized
prior service cost (net of income tax expense of $18
million)
|
- | - | 26 | 26 | ||||||||||||
Unrecognized
net gain (net of income tax expense of $195 million)
|
- | - | 289 | 289 | ||||||||||||
Unrecognized
net transition obligation (net of income tax expense of $11
million)
|
- | - | 16 | 16 | ||||||||||||
Transfer
to regulatory account (net of income tax benefit of $207
million)
(1)
|
- | - | (302 | ) | (302 | ) | ||||||||||
Balance
at December 31, 2007
|
$ | - | $ | (19 | ) | $ | 29 | $ | 10 | |||||||
Period
change in pension benefits and other benefits:
|
||||||||||||||||
Unrecognized
prior service cost (net of income tax expense of $27
million)
|
- | - | 37 | 37 | ||||||||||||
Unrecognized
net loss (net of income tax benefit of $1,088 million)
|
- | - | (1,583 | ) | (1,583 | ) | ||||||||||
Unrecognized
net transition obligation (net of income tax expense of $11
million)
|
- | - | 15 | 15 | ||||||||||||
Transfer
to regulatory account (net of income tax expense of $894
million)
(1)
|
- | - | 1,300 | 1,300 | ||||||||||||
Balance
at December 31, 2008
|
$ | - | $ | (19 | ) | $ | (202 | ) | $ | (221 | ) | |||||
(1)
The Utility recorded approximately $2,259 million in 2008 and $109
million in 2007, pre-tax, as a reduction to the existing pension
regulatory liability in accordance with the provisions of SFAS No.
71. The adjustment resulted in a regulatory asset balance at December
31, 2008. The Utility recorded approximately $44 million in 2007,
pre-tax, as an addition to the existing pension regulatory liability in
accordance with SFAS No. 71. See Note 14 of the Notes to the
Consolidated Financial Statements for further information on pre-tax
transfer amounts to the regulatory account.
|
Balance
at December 31,
|
||||||||
(in
millions)
|
2008
|
2007
|
||||||
Regulatory
asset for pension benefits
|
$ | 1,624 | $ | - | ||||
Regulatory
asset for energy recovery bonds
|
1,487 | 1,833 | ||||||
Regulatory
assets for deferred income tax
|
847 | 732 | ||||||
Utility
retained generation regulatory assets
|
799 | 947 | ||||||
Environmental
compliance costs
|
385 | 328 | ||||||
Price
risk management
|
362 | 20 | ||||||
Unamortized
loss, net of gain, on reacquired debt
|
225 | 269 | ||||||
Regulatory
assets associated with plan of reorganization
|
99 | 122 | ||||||
Contract
termination costs
|
82 | 96 | ||||||
Scheduling
coordinator costs
|
39 | 90 | ||||||
Other
|
47 | 22 | ||||||
Total
regulatory assets
|
$ | 5,996 | $ | 4,459 |
Balance
at December 31,
|
||||||||
(in
millions)
|
2008
|
2007
|
||||||
Cost
of removal obligation
|
$ | 2,735 | $ | 2,568 | ||||
Employee
benefit plans
|
- | 578 | ||||||
Public
purpose programs
|
259 | 264 | ||||||
Recoveries
in excess of asset retirement obligation
|
226 | 573 | ||||||
California
Solar Initiative
|
183 | 159 | ||||||
Price
risk management
|
81 | 124 | ||||||
Gateway
Generating Station
|
67 | 67 | ||||||
Environmental
remediation
|
52 | 66 | ||||||
Other
|
54 | 49 | ||||||
Total
regulatory liabilities
|
$ | 3,657 | $ | 4,448 |
Receivable
(Payable)
|
||||||||
Balance
at December 31,
|
||||||||
(in
millions)
|
2008
|
2007
|
||||||
Energy
resource recovery
|
$ | 384 | $ | 149 | ||||
Modified
transition cost
|
214 | 93 | ||||||
Transmission
revenue
|
173 | 203 | ||||||
Utility
generation
|
164 | 90 | ||||||
Energy
Recovery Bonds
|
(231 | ) | (274 | ) | ||||
Public
purpose programs
|
(264 | ) | (16 | ) | ||||
Reliability
services
|
12 | (96 | ) | |||||
Other
|
15 | (51 | ) | |||||
Total
regulatory balancing accounts, net
|
$ | 467 | $ | 98 |
December
31,
|
||||||||
(in
millions)
|
2008
|
2007
|
||||||
PG&E
Corporation
|
||||||||
Convertible
subordinated notes, 9.50%, due 2010
|
$ | 280 | $ | 280 | ||||
Utility
|
||||||||
Senior
notes:
|
||||||||
3.60%
due 2009
|
600 | 600 | ||||||
4.20%
due 2011
|
500 | 500 | ||||||
6.25%
due 2013
|
400 | - | ||||||
4.80%
due 2014
|
1,000 | 1,000 | ||||||
5.625%
due 2017
|
700 | 500 | ||||||
8.25%
due 2018
|
800 | - | ||||||
6.05%
due 2034
|
3,000 | 3,000 | ||||||
5.80%
due 2037
|
700 | 700 | ||||||
6.35%
due 2038
|
400 | - | ||||||
Less:
current portion
|
(600 | ) | - | |||||
Unamortized
discount, net of premium
|
(22 | ) | (22 | ) |
Total
senior notes
|
7,478 | 6,278 |
Pollution
control bonds:
|
||||||||
Series
1996 C, E, F, 1997 B, variable rates
(1)
,
due 2026
(2)
|
614 | 614 | ||||||
Series
1996 A, 5.35%, due 2016
|
200 | 200 | ||||||
Series
2004 A-D, 4.75%, due 2023
|
345 | 345 | ||||||
Series
2005 A-G, variable rates, due 2016 and 2026
(3)
|
- | 454 | ||||||
Series
2008 A-D, variable rates
(4)
,
due 2016 and 2026
(5)
|
309 | - | ||||||
Series
2008 F and G, 3.75%
(6)
,
due 2018 and 2026
|
95 | - | ||||||
Total
pollution control bonds
|
1,563 | 1,613 | ||||||
Total
Utility long-term debt, net of current portion
|
9,041 | 7,891 | ||||||
Total
consolidated long-term debt, net of current portion
|
$ | 9,321 | $ | 8,171 | ||||
(1)
At
December 31, 2008, interest rates on these bonds and the related loans
ranged from 0.75% to 1.20%.
|
||||||||
(2)
Each
series of these bonds is supported by a separate letter of credit which
expires on February 24, 2012. Although the stated maturity date is
2026, each series will remain outstanding only if the Utility extends or
replaces the letter of credit related to the series or otherwise obtains
consent from the issuer to the continuation of the series without a credit
facility.
|
||||||||
(3)
During
2008, the credit rating of the insurer of these bonds was downgraded or
put on review for possible downgrade by several credit agencies, resulting
in increased interest rates. To reduce interest expense, the Utility
repurchased $300 million of the 2005 bonds in March 2008 and the remaining
$154 million in April 2008. In September and October 2008, all of
these series, except for the Series 2005 E bonds, were refunded through
the issuance of the Series 2008 A-D and F and G bonds. See footnotes
4 and 5.
|
||||||||
(4)
At December 31, 2008, interest rates on these bonds and the related loans
ranged from 0.57% to 0.85%.
|
||||||||
(5)
Each series of these bonds is supported by a separate direct-pay letter of
credit which expires on October 29, 2011. The Utility may choose to
provide a substitute letter of credit for any series of these bonds,
subject to a rating requirement.
|
||||||||
(6)
These bonds bear interest at 3.75% per year through September 19, 2010,
are subject to mandatory tender on September 10, 2010, and may be
remarketed in a fixed or variable rate mode.
|
(in
millions, except interest rates)
|
2009
|
2010
|
2011
|
2012
|
2013
|
Thereafter
|
Total
|
|||||||||||||||||||||
Long-term
debt:
|
||||||||||||||||||||||||||||
PG&E
Corporation
|
||||||||||||||||||||||||||||
Average
fixed interest rate
|
- | 9.50 | % | - | - | - | - | 9.50 | % | |||||||||||||||||||
Fixed
rate obligations
|
- | $ | 280 | - | - | - | - | $ | 280 | |||||||||||||||||||
Utility
|
||||||||||||||||||||||||||||
Average
fixed interest rate
|
3.60 | % | 3.75 | % | 4.20 | % | - | 6.25 | % | 5.99 | % | 5.71 | % | |||||||||||||||
Fixed
rate obligations
|
$ | 600 | $ | 95 | $ | 500 | - | $ | 400 | $ | 7,145 | $ | 8,740 | |||||||||||||||
Variable
interest rate as of December 31, 2008
|
- | - | 0.75 | % | 0.92 | % | - | - | 0.87 | % | ||||||||||||||||||
Variable
rate obligations
|
- | - | $ | 309 | (1) | $ | 614 | (2) | - | - | $ | 923 | ||||||||||||||||
Total
consolidated long-term debt
|
$ | 600 | $ | 375 | $ | 809 | $ | 614 | $ | 400 | $ | 7,145 | $ | 9,943 | ||||||||||||||
(1)
These bonds, due in 2016-2026, are backed by a direct-pay letter of credit
which expires on October 29, 2011. The bonds will be subject to a
mandatory redemption unless the letter of credit is extended or replaced
or the issuer consents to the continuation of these series without a
credit facility. Accordingly, the bonds have been classified for
repayment purposes in 2011.
|
||||||||||||||||||||||||||||
(2)
The $614 million pollution control bonds, due in 2026, are backed by
letters of credit which expire on February 24, 2012. The bonds will
be subject to a mandatory redemption unless the letters of credit are
extended or replaced. Accordingly, the bonds have been classified for
repayment purposes in 2012.
|
(in
millions)
|
At
December 31, 2008
|
|||||||||||||||||||||
Authorized
Borrower
|
Facility
|
Termination
Date
|
Facility
Limit
|
Letters
of Credit Out-standing
|
Cash
Borrowings
|
Commercial
Paper Backup
|
Availability
|
|||||||||||||||
PG&E
Corporation
|
Revolving
credit facility
|
February
2012
|
$ | 200 | (1) | $ | - | $ | - | $ | - | $ | 200 | |||||||||
Utility
|
Revolving
credit facility
|
February
2012
|
2,000 | (2) | 287 | - | 287 | 1,426 | ||||||||||||||
Total
credit facilities
|
$ | 2,200 | $ | 287 | $ | - | $ | 287 | $ | 1,626 | ||||||||||||
|
||||||||||||||||||||||
(1)
Includes a $50 million sublimit for letters of credit and $100 million
sublimit for “swingline” loans, defined as loans which are made available
on a same-day basis and are repayable in full within 30
days.
|
||||||||||||||||||||||
(2)
Includes a $950 million sublimit for letters of credit and $100 million
sublimit for swingline loans.
|
(in
millions)
|
2009
|
2010
|
2011
|
2012
|
Total
|
|||||||||||||||
Utility
|
|
|||||||||||||||||||
Average
fixed interest rate
|
4.36 | % | 4.49 | % | 4.59 | % | 4.66 | % | 4.53 | % | ||||||||||
Energy
recovery bonds
|
$ | 370 | $ | 386 | $ | 404 | $ | 423 | $ | 1,583 |
(in
millions)
|
2008
|
2007
|
||||||
Current
Assets
|
||||||||
Income
taxes receivable
|
$ | 137 | $ | 33 | ||||
Current
Liabilities
|
||||||||
Income
taxes payable
|
- | - | ||||||
Other
|
10 | 11 | ||||||
Noncurrent
Liabilities
|
||||||||
Income
taxes payable
|
3 | 74 | ||||||
Deferred
income taxes
|
7 | 34 | ||||||
Other
|
12 | 14 |
PG&E
Corporation
|
Utility
|
|||||||||||||||||||||||
Year
Ended December 31,
|
||||||||||||||||||||||||
(in
millions)
|
2008
|
2007
|
2006
|
2008
|
2007
|
2006
|
||||||||||||||||||
Current:
|
||||||||||||||||||||||||
Federal
|
$ | (268 | ) | $ | 526 | $ | 743 | $ | (188 | ) | $ | 563 | $ | 771 | ||||||||||
State
|
33 | 140 | 201 | 24 | 149 | 210 | ||||||||||||||||||
Deferred:
|
||||||||||||||||||||||||
Federal
|
604 | (81 | ) | (286 | ) | 596 | (92 | ) | (276 | ) | ||||||||||||||
State
|
62 | (40 | ) | (98 | ) | 62 | (43 | ) | (97 | ) | ||||||||||||||
Tax
credits, net
|
(6 | ) | (6 | ) | (6 | ) | (6 | ) | (6 | ) | (6 | ) | ||||||||||||
Income
tax expense
|
$ | 425 | $ | 539 | $ | 554 | $ | 488 | $ | 571 | $ | 602 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
Year
Ended December 31,
|
||||||||||||||||
(in
millions)
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
Deferred
income tax assets:
|
||||||||||||||||
Customer
advances for construction
|
$ | 199 | $ | 143 | $ | 199 | $ | 143 | ||||||||
Reserve
for damages
|
130 | 173 | 129 | 173 | ||||||||||||
Environmental
reserve
|
225 | 172 | 225 | 172 | ||||||||||||
Compensation
|
339 | 162 | 306 | 129 | ||||||||||||
Other
|
231 | 289 | 201 | 261 | ||||||||||||
Total
deferred income tax assets
|
$ | 1,124 | $ | 939 | $ | 1,060 | $ | 878 | ||||||||
Deferred
income tax liabilities:
|
||||||||||||||||
Regulatory
balancing accounts
|
$ | 1,425 | $ | 1,219 | $ | 1,425 | $ | 1,219 | ||||||||
Property
related basis differences
|
2,819 | 2,290 | 2,813 | 2,293 | ||||||||||||
Income
tax regulatory asset
|
345 | 298 | 345 | 298 | ||||||||||||
Unamortized
loss on reacquired debt
|
102 | 110 | 102 | 110 | ||||||||||||
Other
|
81 | 75 | 81 | 66 | ||||||||||||
Total
deferred income tax liabilities
|
$ | 4,772 | $ | 3,992 | $ | 4,766 | $ | 3,986 | ||||||||
Total
net deferred income tax liabilities
|
$ | 3,648 | $ | 3,053 | $ | 3,706 | $ | 3,108 | ||||||||
Classification
of net deferred income tax liabilities:
|
||||||||||||||||
Included
in current liabilities
|
$ | 251 | $ | - | $ | 257 | $ | 4 | ||||||||
Included
in noncurrent liabilities
|
3,397 | 3,053 | 3,449 | 3,104 | ||||||||||||
Total
net deferred income tax liabilities
|
$ | 3,648 | $ | 3,053 | $ | 3,706 | $ | 3,108 |
PG&E
Corporation
|
Utility
|
|||||||||||||
Year
Ended December 31,
|
||||||||||||||
2008
|
2007
|
2006
|
2008
|
2007
|
2006
|
|||||||||
Federal
statutory income tax rate
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
||
Increase
(decrease) in income tax rate resulting from:
|
||||||||||||||
State
income tax (net of federal benefit)
|
3.1
|
4.2
|
4.3
|
3.3
|
4.3
|
4.6
|
||||||||
Effect
of regulatory treatment of fixed asset differences
|
(3.2)
|
(3.0)
|
(1.2)
|
(3.1)
|
(2.9)
|
(1.1)
|
||||||||
Tax
credits, net
|
(0.5)
|
(0.7)
|
(0.6)
|
(0.5)
|
(0.7)
|
(0.6)
|
||||||||
IRS
Audit Settlements
|
(7.1)
|
-
|
-
|
(4.1)
|
-
|
-
|
||||||||
Other,
net
|
(0.9)
|
(0.6)
|
(1.6)
|
(1.7)
|
0.1
|
0.1
|
||||||||
Effective
tax rate
|
26.4
|
%
|
34.9
|
%
|
35.9
|
%
|
28.9
|
%
|
35.8
|
%
|
38.0
|
%
|
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
Balance
at January 1, 2007
|
$ | 212 | $ | 90 | ||||
Additions
for tax position of prior years
|
15 | 4 | ||||||
Reductions
for tax position of prior years
|
(18 | ) | - | |||||
Balance
at December 31, 2007
|
$ | 209 | $ | 94 | ||||
Additions
for tax position of prior years
|
43 | 20 | ||||||
Decreases
as a result of settlements with the IRS
|
(177 | ) | (77 | ) | ||||
Balance
at December 31, 2008
|
$ | 75 | $ | 37 |
Price
Risk Management Derivatives Balance at December 31,
2008
|
||||||||||||||||
(in
millions)
|
Derivatives
with No Hedge Designation
|
Designated
as Cash Flow Hedges
|
Cash
Collateral
|
Total
Price Risk Management Derivatives
|
||||||||||||
Current
Assets – Prepaid expenses and other
|
$ | 55 | $ | - | $ | 55 | $ | 110 | ||||||||
Other
Noncurrent Assets – Other
|
81 | - | 67 | 148 | ||||||||||||
Current
Liabilities – Other
|
132 | 139 | (75 | ) | 196 | |||||||||||
Noncurrent
Liabilities – Other
|
150 | 211 | (69 | ) | 292 |
●
|
The
fair values of cash and cash equivalents, restricted cash and deposits,
net accounts receivable, price risk management assets and liabilities,
short-term borrowings, accounts payable, customer deposits, and the
Utility's variable rate pollution control bond loan agreements approximate
their carrying values as of December 31, 2008 and 2007.
|
●
|
The
fair values of the Utility’s fixed rate senior notes, fixed rate pollution
control bond loan agreements, and the ERBs issued by PG&E Energy
Recovery Funding LLC, were based on quoted market prices obtained from the
Bloomberg financial information system at December 31,
2008.
|
●
|
The
estimated fair value of PG&E Corporation’s 9.50% Convertible
Subordinated Notes was determined by considering the prices of securities
displayed as of the close of business on December 31, 2008 by a
proprietary bond trading system which tracks and marks a broad universe of
convertible securities including the securities being
assessed.
|
At
December 31,
|
||||||||||||||||
2008
|
2007
|
|||||||||||||||
(in
millions)
|
Carrying
Amount
|
Fair
Value
|
Carrying
Amount
|
Fair
Value
|
||||||||||||
Debt
(Note 4):
|
||||||||||||||||
PG&E
Corporation
|
$ | 280 | $ | 739 | $ | 280 | $ | 849 | ||||||||
Utility
|
8,740 | 9,134 | 6,823 | 6,701 | ||||||||||||
Energy
recovery bonds (Note 5)
|
1,583 | 1,564 | 1,936 | 1,928 |
PG&E
Corporation
|
||||||||||||||||||||||||||||
(in
millions)
|
Money
Market Investments
|
Price
Risk Management Instruments
|
Nuclear
Decommissioning Trusts
(3)
|
Long-term
Disability
|
Dividend
Participation Rights
|
Other
|
Total
|
|||||||||||||||||||||
Asset
(liability) Balance as of January 1, 2008
|
$ | - | $ | 115 | (1) | $ | 8 | $ | 87 | $ | (68 | ) (2) | $ | (4 | ) | $ | 138 | |||||||||||
Realized
and unrealized gains (losses):
|
||||||||||||||||||||||||||||
Included
in earnings
|
- | - | - | (34 | ) | (3 | ) | - | (37 | ) | ||||||||||||||||||
Included
in regulatory assets and liabilities or balancing accounts
|
- | (271 | ) | (3 | ) | - | - | 2 | (272 | ) | ||||||||||||||||||
Purchases,
issuances, and settlements
|
(50 | ) | - | - | 25 | 29 | - | 4 | ||||||||||||||||||||
Transfers
in (out) of Level 3
|
62 | - | - | - | - | - | 62 | |||||||||||||||||||||
Asset
(liability) Balance as of December 31, 2008
|
$ | 12 | $ | (156 | ) | $ | 5 | $ | 78 | $ | (42 | ) | $ | (2 | ) | $ | (105 | ) | ||||||||||
(1)
Includes the impact of the $48 million retrospective adjustment related to
the CRRs on January 1, 2008. Additionally, the balance includes the
impact of netting adjustments of $6 million made in accordance with the
requirements of FIN 39-1.
|
||||||||||||||||||||||||||||
(2)
The discount factor used to value these rights was adjusted on January 1,
2008 in order to comply with the provisions of SFAS No. 157, resulting in
a $6 million expense to increase the value of the
liability.
|
||||||||||||||||||||||||||||
(3)
Excludes taxes on appreciation of investment value.
|
Year
Ended December 31,
|
||||||||||||
(in
millions)
|
2008
|
2007
|
2006
|
|||||||||
Proceeds
received from sales of securities
|
$ | 1,635 | $ | 830 | $ | 1,087 | ||||||
Gross
realized gains on sales of securities held as
available-for-sale
|
30 | 61 | 55 | |||||||||
Gross
realized losses on sales of securities held as
available-for-sale
|
(142 | ) | (42 | ) | (29 | ) |
PG&E
Corporation
|
Utility
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Projected
benefit obligation at January 1
|
$ | 9,081 | $ | 9,064 | $ | 9,036 | $ | 9,023 | ||||||||
Service
cost for benefits earned
|
236 | 233 | 234 | 228 | ||||||||||||
Interest
cost
|
581 | 544 | 578 | 541 | ||||||||||||
Actuarial
(gain) loss
|
258 | (397 | ) | 255 | (396 | ) | ||||||||||
Plan
amendments
|
2 | 1 | 3 | 2 | ||||||||||||
Benefits
and expenses paid
|
(391 | ) | (364 | ) | (389 | ) | (362 | ) | ||||||||
Projected
benefit obligation at December 31
|
$ | 9,767 | $ | 9,081 | $ | 9,717 | $ | 9,036 | ||||||||
Accumulated
benefit obligation
|
$ | 8,601 | $ | 8,243 | $ | 8,559 | $ | 8,206 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Benefit
obligation at January 1
|
$ | 1,311 | $ | 1,310 | $ | 1,311 | $ | 1,310 | ||||||||
Service
cost for benefits earned
|
29 | 29 | 29 | 29 | ||||||||||||
Interest
cost
|
81 | 79 | 81 | 79 | ||||||||||||
Actuarial
(gain) loss
|
22 | (66 | ) | 22 | (66 | ) | ||||||||||
Plan
amendments
|
- | 17 | - | 17 | ||||||||||||
Gross
benefits paid
|
(101 | ) | (97 | ) | (101 | ) | (97 | ) | ||||||||
Federal
subsidy on benefits paid
|
4 | 4 | 4 | 4 | ||||||||||||
Participants
paid benefits
|
36 | 35 | 36 | 35 | ||||||||||||
Benefit
obligation at December 31
|
$ | 1,382 | $ | 1,311 | $ | 1,382 | $ | 1,311 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Fair
value of plan assets at January 1
|
$ | 9,540 | $ | 9,028 | $ | 9,540 | $ | 9,028 | ||||||||
Actual
return on plan assets
|
(1,232 | ) | 766 | (1,232 | ) | 766 | ||||||||||
Company
contributions
|
182 | 139 | 179 | 137 | ||||||||||||
Benefits
and expenses paid
|
(424 | ) | (393 | ) | (421 | ) | (391 | ) | ||||||||
Fair
value of plan assets at December 31
|
$ | 8,066 | $ | 9,540 | $ | 8,066 | $ | 9,540 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Fair
value of plan assets at January 1
|
$ | 1,331 | $ | 1,256 | $ | 1,331 | $ | 1,256 | ||||||||
Actual
return on plan assets
|
(316 | ) | 107 | (316 | ) | 107 | ||||||||||
Company
contributions
|
48 | 38 | 48 | 38 | ||||||||||||
Plan
participant contribution
|
36 | 36 | 36 | 36 | ||||||||||||
Benefits
and expenses paid
|
(109 | ) | (106 | ) | (109 | ) | (106 | ) | ||||||||
Fair
value of plan assets at December 31
|
$ | 990 | $ | 1,331 | $ | 990 | $ | 1,331 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
December
31,
|
December
31,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Fair
value of plan assets at December 31
|
$ | 8,066 | $ | 9,540 | $ | 8,066 | $ | 9,540 | ||||||||
Projected
benefit obligation at December 31
|
(9,767 | ) | (9,081 | ) | (9,717 | ) | (9,036 | ) | ||||||||
Prepaid/(accrued)
benefit cost
|
$ | (1,701 | ) | $ | 459 | $ | (1,651 | ) | $ | 504 | ||||||
Noncurrent
asset
|
$ | - | $ | 532 | $ | - | $ | 532 | ||||||||
Current
liability
|
(5 | ) | (2 | ) | (3 | ) | (3 | ) | ||||||||
Noncurrent
liability
|
(1,696 | ) | (71 | ) | (1,648 | ) | (25 | ) | ||||||||
Prepaid/(accrued)
benefit cost
|
$ | (1,701 | ) | $ | 459 | $ | (1,651 | ) | $ | 504 |
PG&E
Corporation
|
Utility
|
|||||||||||||||
December
31,
|
December
31,
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
Fair
value of plan assets at December 31
|
$ | 990 | $ | 1,331 | $ | 990 | $ | 1,331 | ||||||||
Benefit
obligation at December 31
|
(1,382 | ) | (1,311 | ) | (1,382 | ) | (1,311 | ) | ||||||||
Prepaid/(accrued)
benefit cost
|
$ | (392 | ) | $ | 20 | $ | (392 | ) | $ | 20 | ||||||
Noncurrent
asset
|
$ | - | $ | 54 | $ | - | $ | 54 | ||||||||
Noncurrent
liability
|
(392 | ) | (34 | ) | (392 | ) | (34 | ) | ||||||||
Prepaid/(accrued)
benefit cost
|
$ | (392 | ) | $ | 20 | $ | (392 | ) | $ | 20 |
Pension
Benefits
|
Other
Benefits
|
|||||||||||||||
2008
|
2007
|
2008
|
2007
|
|||||||||||||
(in
millions)
|
||||||||||||||||
PG&E
Corporation:
|
||||||||||||||||
Projected
benefit obligation
|
$ | (9,767 | ) | $ | (73 | ) | $ | (1,382 | ) | $ | (187 | ) | ||||
Accumulated
benefit obligation
|
(8,601 | ) | (64 | ) | - | - | ||||||||||
Fair
value of plan assets
|
8,066 | - | 990 | 153 | ||||||||||||
Utility:
|
||||||||||||||||
Projected
benefit obligation
|
$ | (9,717 | ) | $ | (27 | ) | $ | (1,382 | ) | $ | (187 | ) | ||||
Accumulated
benefit obligation
|
(8,559 | ) | (27 | ) | - | - | ||||||||||
Fair
value of plan assets
|
8,066 | - | 990 | 153 |
December
31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Service
cost for benefits earned
|
$ | 236 | $ | 233 | $ | 236 | ||||||
Interest
cost
|
581 | 544 | 511 | |||||||||
Expected
return on plan assets
|
(696 | ) | (711 | ) | (640 | ) | ||||||
Amortization
of prior service cost
(1)
|
47 | 49 | 56 | |||||||||
Amortization
of unrecognized gain
(1)
|
1 | 2 | 22 | |||||||||
Net
periodic benefit cost
|
$ | 169 | $ | 117 | $ | 185 | ||||||
(1)
In 2007 and 2008,
under SFAS No.158, PG&E Corporation and the Utility recorded amounts
related to pension and other benefits in other comprehensive income, net
of related deferred taxes, except for a portion recorded as a regulatory
liability in accordance with SFAS No. 71.
|
December
31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
(in
millions)
|
||||||||||||
Service
cost for benefits earned
|
$ | 29 | $ | 29 | $ | 28 | ||||||
Interest
cost
|
81 | 79 | 74 | |||||||||
Expected
return on plan assets
|
(93 | ) | (96 | ) | (90 | ) | ||||||
Amortization
of transition obligation
(1)
|
26 | 26 | 26 | |||||||||
Amortization
of prior service cost
(1)
|
16 | 16 | 14 | |||||||||
Amortization
of unrecognized gain
(1)
|
(15 | ) | (10 | ) | (3 | ) | ||||||
Net
periodic benefit cost
|
$ | 44 | $ | 44 | $ | 49 | ||||||
(1)
In 2007 and 2008,
under SFAS No.158, PG&E Corporation and the Utility recorded amounts
related to pension and other benefits in other comprehensive income, net
of related deferred taxes, except for a portion recorded as a regulatory
liability in accordance with SFAS No. 71.
|
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
Pension
benefits
:
|
||||||||
Unrecognized
prior service cost
|
$ | 47 | $ | 48 | ||||
Unrecognized
net loss
|
98 | 97 | ||||||
Total
|
$ | 145 | $ | 145 | ||||
Other
benefits:
|
||||||||
Unrecognized
prior service cost
|
$ | 16 | $ | 16 | ||||
Unrecognized
net loss
|
3 | 3 | ||||||
Unrecognized
net transition obligation
|
26 | 26 | ||||||
Total
|
$ | 45 | $ | 45 |
Pension
Benefits
|
Other
Benefits
|
|||||||||||||
December
31,
|
December
31,
|
|||||||||||||
2008
|
2007
|
2006
|
2008
|
2007
|
2006
|
|||||||||
Discount
rate
|
6.31
|
%
|
6.31
|
%
|
5.90
|
%
|
5.85-6.33
|
%
|
5.52-6.42
|
%
|
5.50-6.00
|
%
|
||
Average
rate of future compensation increases
|
5.00
|
%
|
5.00
|
%
|
5.00
|
%
|
-
|
-
|
-
|
|||||
Expected
return on plan assets
|
7.30
|
%
|
7.40
|
%
|
8.00
|
%
|
7.00-7.30
|
%
|
7.00-7.50
|
%
|
7.30-8.20
|
%
|
(in
millions)
|
One-Percentage
Point Increase
|
One-Percentage
Point Decrease
|
||||||
Effect
on postretirement benefit obligation
|
$ | 68 | $ | (57 | ) | |||
Effect
on service and interest cost
|
7 | (6 | ) |
Pension
Benefits
|
Other
Benefits
|
|||||||||||||||||||||||
2009
|
2008
|
2007
|
2009
|
2008
|
2007
|
|||||||||||||||||||
Equity
securities
|
||||||||||||||||||||||||
U.S.
equity
|
32 | % | 31 | % | 30 | % | 37 | % | 35 | % | 36 | % | ||||||||||||
Non-U.S.
equity
|
18 | % | 17 | % | 18 | % | 18 | % | 16 | % | 19 | % | ||||||||||||
Global
equity
|
5 | % | 3 | % | 5 | % | 3 | % | 2 | % | 4 | % | ||||||||||||
Absolute
return
|
5 | % | 4 | % | 5 | % | 3 | % | 3 | % | 3 | % | ||||||||||||
Fixed
income securities
|
40 | % | 42 | % | 41 | % | 34 | % | 34 | % | 37 | % | ||||||||||||
Cash
|
0 | % | 3 | % | 1 | % | 5 | % | 10 | % | 1 | % | ||||||||||||
Total
|
100 | % | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % |
PG&E
Corporation
|
Utility
|
||||||||
(in
millions)
|
|||||||||
Pension
|
|||||||||
2009
|
$ | 440 | $ | 437 | |||||
2010
|
470 | 467 | |||||||
2011
|
502 | 500 | |||||||
2012
|
538 | 536 | |||||||
2013
|
575 | 573 | |||||||
2014-2018 | 3,433 | 3,415 | |||||||
Other
benefits
|
|||||||||
2009
|
$ | 98 | $ | 98 | |||||
2010
|
101 | 101 | |||||||
2011
|
104 | 104 | |||||||
2012
|
105 | 105 | |||||||
2013
|
108 | 108 | |||||||
2014-2018 | 572 | 572 |
(in
millions)
|
PG&E
Corporation
|
Utility
|
||||||
Year
ended December 31,
|
||||||||
2008
|
$ | 53 | $ | 52 | ||||
2007
|
47 | 46 | ||||||
2006
|
45 | 43 |
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
2008
|
$ | (7 | ) | $ | (4 | ) | ||
2007
|
2 | 1 | ||||||
2006
|
4 | 2 |
Year
ended December 31, 2008
|
||||||||
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
Stock
Options
|
$ | 2 | $ | 2 | ||||
Restricted
Stock
|
22 | 15 | ||||||
Performance
Shares
|
33 | 20 | ||||||
Total
Compensation Expense (pre-tax)
|
$ | 57 | $ | 37 | ||||
Total
Compensation Expense (after-tax)
|
$ | 34 | $ | 22 |
Year
ended December 31, 2007
|
||||||||
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
Stock
Options
|
$ | 7 | $ | 4 | ||||
Restricted
Stock
|
24 | 15 | ||||||
Performance
Shares
|
(8 | ) | (7 | ) | ||||
Total
Compensation Expense (pre-tax)
|
$ | 23 | $ | 12 | ||||
Total
Compensation Expense (after-tax)
|
$ | 14 | $ | 7 |
2008
|
2007
|
2006
|
||||||||||
Expected
stock price volatility
|
18.9 | % | 16.5 | % | 22.1 | % | ||||||
Expected
annual dividend payment
|
$ | 1.56 | $ | 1.44 | $ | 1.32 | ||||||
Risk-free
interest rate
|
2.77 | % | 4.73 | % | 4.46 | % | ||||||
Expected
life
|
5.4
years
|
5.4
years
|
5.6
years
|
PG&E
Corporation
|
Utility
|
|||||||
(in
millions)
|
||||||||
2008:
|
||||||||
Intrinsic
value of options exercised
|
$ | 13 | $ | 9 | ||||
2007:
|
||||||||
Intrinsic
value of options exercised
|
$ | 59 | $ | 34 | ||||
2006:
|
||||||||
Intrinsic
value of options exercised
|
$ | 97 | $ | 51 |
Number
of Shares of
Restricted
Stock
|
Weighted
Average Grant-Date Fair Value
|
|||||||
Nonvested
at January 1
|
1,261,125 | $ | 40.51 | |||||
Granted
|
591,294 | $ | 37.91 | |||||
Vested
|
(440,652 | ) | $ | 37.20 | ||||
Forfeited
|
(124,198 | ) | $ | 43.27 | ||||
Nonvested
at December 31
|
1,287,569 | $ | 40.18 |
(in
millions)
|
||||
Balance
at December 31, 2007
|
$ | 1,719 | ||
Interest
accrued
|
80 | |||
Less:
Settlements
|
(49 | ) | ||
Balance
at December 31, 2008
|
$ | 1,750 |
Year Ended December
31,
|
||||||||||||
2008
|
2007
|
2006
|
||||||||||
(
in
millions)
|
||||||||||||
Utility
revenues from:
|
||||||||||||
Administrative
services provided to PG&E Corporation
|
$ | 4 | $ | 4 | $ | 5 | ||||||
Interest
from PG&E Corporation on employee
benefit
assets
|
- | 1 | 1 | |||||||||
Utility
expenses from:
|
||||||||||||
Administrative
services received from PG&E
Corporation
|
$ | 122 | $ | 107 | $ | 108 | ||||||
Utility
employee benefit payments provided to PG&E Corporation
Corporation
|
2 | 4 | 3 |
(in
millions)
|
2008
|
2007
|
2006
|
|||||||||
Qualifying
facility energy payments
|
$ | 969 | $ | 812 | $ | 661 | ||||||
Qualifying
facility capacity payments
|
343 | 363 | 366 | |||||||||
Irrigation
district and water agency payments
|
69 | 72 | 64 | |||||||||
Renewable
energy and capacity payments
|
714 | 604 | 429 | |||||||||
Other
power purchase agreement payments
|
2,036 | 1,166 | 670 |
Qualifying
Facility
|
Irrigation
District & Water Agency
|
Renewable
|
Other
|
|||||||||||||||||||||||||||||||||
(in
millions)
|
Energy
|
Capacity
|
Operations
& Maintenance
|
Debt
Service
|
Energy
|
Capacity
|
Energy
|
Capacity
|
Total
Payments
|
|||||||||||||||||||||||||||
2009
|
$ | 949 | $ | 412 | $ | 38 | $ | 26 | $ | 427 | $ | 12 | $ | 5 | $ | 270 | $ | 2,139 | ||||||||||||||||||
2010
|
960 | 378 | 45 | 23 | 460 | 7 | 6 | 281 | 2,160 | |||||||||||||||||||||||||||
2011
|
947 | 364 | 46 | 21 | 602 | 7 | 7 | 164 | 2,158 | |||||||||||||||||||||||||||
2012
|
808 | 334 | 32 | 21 | 688 | 7 | 7 | 86 | 1,983 | |||||||||||||||||||||||||||
2013
|
755 | 324 | 21 | 15 | 583 | - | 7 | 71 | 1,776 | |||||||||||||||||||||||||||
Thereafter
|
4,882 | 1,866 | 46 | 38 | 6,986 | - | 3 | 1,038 | 14,859 | |||||||||||||||||||||||||||
Total
|
$ | 9,301 | $ | 3,678 | $ | 228 | $ | 144 | $ | 9,746 | $ | 33 | $ | 35 | $ | 1,910 | $ | 25,075 |
(in
millions)
|
||||
2009
|
$ | 50 | ||
2010
|
50 | |||
2011
|
50 | |||
2012
|
50 | |||
2013
|
50 | |||
Thereafter
|
204 | |||
Total
fixed capacity payments
|
454 | |||
Amount
representing interest
|
110 | |||
Present
value of fixed capacity payments
|
$ | 344 |
(in
millions)
|
||||
2009
|
$
|
898
|
||
2010
|
183
|
|||
2011
|
115
|
|||
2012
|
49
|
|||
2013
|
42
|
|||
Thereafter
|
157
|
|||
Total
|
$
|
1,444
|
(in
millions)
|
||||
2009
|
$
|
95
|
||
2010
|
108
|
|||
2011
|
92
|
|||
2012
|
79
|
|||
2013
|
81
|
|||
Thereafter
|
495
|
|||
Total
|
$
|
950
|
(in
millions)
|
||||
2009
|
$
|
45
|
||
2010
|
18
|
|||
2011
|
17
|
|||
2012
|
17
|
|||
2013
|
16
|
|||
Thereafter
|
34
|
|||
Total
|
$
|
147
|
●
|
After
assumption, the Utility’s issuer rating by Moody’s will be no less than A2
and the Utility’s long-term issuer credit rating by S&P will be no
less than A. The Utility’s current issuer rating by Moody’s is
A3 and the Utility’s long-term issuer credit rating by S&P is
BBB+;
|
●
|
The
CPUC first makes a finding that the DWR power purchase contracts to be
assumed are just and reasonable; and
|
●
|
The
CPUC has acted to ensure that the Utility will receive full and timely
recovery in its retail electricity rates of all costs associated with the
DWR power purchase contracts to be assumed without further
review.
|
●
|
Approximately
$51 million for remediation at the Utility’s natural gas compressor site
located near Hinkley, California;
|
●
|
Approximately
$167 million for remediation at the Utility’s natural gas compressor site
located in Topock, Arizona near the California border;
|
●
|
Approximately
$83 million related to remediation at divested generation
facilities;
|
●
|
Approximately
$216 million related to remediation costs for the Utility’s generation and
other facilities, third-party disposal sites, and manufactured gas plant
sites owned by the Utility or third parties (including those sites that
are the subject of remediation orders by environmental agencies or claims
by the current owners of the former manufactured gas plant sites);
and
|
●
|
Approximately
$51 million related to remediation costs for fossil decommissioning
sites.
|
Quarter
ended
|
||||||||||||||||
December
31
|
September
30
|
June
30
|
March
31
|
|||||||||||||
(in
millions, except per share amounts)
|
||||||||||||||||
2008
|
||||||||||||||||
PG&E
CORPORATION
|
||||||||||||||||
Operating
revenues
|
$ | 3,643 | $ | 3,674 | $ | 3,578 | $ | 3,733 | ||||||||
Operating
income
|
545 | 639 | 584 | 493 | ||||||||||||
Income
from continuing operations
|
363 | 304 | 293 | 224 | ||||||||||||
Net
income
|
517 | 304 | 293 | 224 | ||||||||||||
Earnings
per common share from continuing operations, basic
|
0.98 | 0.83 | 0.80 | 0.62 | ||||||||||||
Earnings
per common share from continuing operations, diluted
|
0.97 | 0.83 | 0.80 | 0.62 | ||||||||||||
Net
income per common share, basic
|
1.39 | 0.83 | 0.80 | 0.62 | ||||||||||||
Net
income per common share, diluted
|
1.37 | 0.83 | 0.80 | 0.62 | ||||||||||||
Common
stock price per share:
|
||||||||||||||||
High
|
39.20 | 42.64 | 40.90 | 44.95 | ||||||||||||
Low
|
29.70 | 36.81 | 38.09 | 36.46 | ||||||||||||
UTILITY
|
||||||||||||||||
Operating
revenues
|
$ | 3,643 | $ | 3,674 | $ | 3,578 | $ | 3,733 | ||||||||
Operating
income
|
548 | 640 | 585 | 493 | ||||||||||||
Net
income
|
329 | 321 | 313 | 236 | ||||||||||||
Income
available for common stock
|
325 | 318 | 309 | 233 | ||||||||||||
2007
|
||||||||||||||||
PG&E
CORPORATION
|
||||||||||||||||
Operating
revenues
|
$ | 3,415 | $ | 3,279 | $ | 3,187 | $ | 3,356 | ||||||||
Operating
income
|
448 | 582 | 555 | 529 | ||||||||||||
Income
from continuing operations
|
203 | 278 | 269 | 256 | ||||||||||||
Net
income
|
203 | 278 | 269 | 256 | ||||||||||||
Earnings
per common share from continuing operations, basic
|
0.56 | 0.77 | 0.75 | 0.71 | ||||||||||||
Earnings
per common share from continuing operations, diluted
|
0.56 | 0.77 | 0.74 | 0.71 | ||||||||||||
Net
income per common share, basic
|
0.56 | 0.77 | 0.75 | 0.71 | ||||||||||||
Net
income per common share, diluted
|
0.56 | 0.77 | 0.74 | 0.71 | ||||||||||||
Common
stock price per share:
|
||||||||||||||||
High
|
48.56 | 47.87 | 50.89 | 47.71 | ||||||||||||
Low
|
43.09 | 42.14 | 43.90 | 43.87 | ||||||||||||
UTILITY
|
||||||||||||||||
Operating
revenues
|
$ | 3,416 | $ | 3,279 | $ | 3,187 | $ | 3,356 | ||||||||
Operating
income
|
453 | 585 | 556 | 531 | ||||||||||||
Net
income
|
206 | 283 | 274 | 261 | ||||||||||||
Income
available for common stock
|
203 | 279 | 270 | 258 |
Parent
of Significant Subsidiary
|
Name
of Significant Subsidiary
|
Jurisdiction
of Formation of Subsidiary
|
Names
under which Significant Subsidiary does business
|
|||
PG&E
Corporation
|
Pacific
Gas and Electric Company
|
CA
|
Pacific
Gas and Electric Company
PG&E
|
|||
Pacific
Gas and Electric Company
|
None
|
LINDA
Y.H. CHENG
|
Linda
Y.H. Cheng
|
Vice
President, Corporate Governance and Corporate Secretary
|
PG&E
CORPORATION
|
LINDA
Y.H. CHENG
|
Linda
Y.H. Cheng
|
Vice
President, Corporate Governance and Corporate Secretary
|
Pacific
Gas and Electric Company
|
DAVID
R. ANDREWS
|
RICHARD
A. MESERVE
|
|
David
R. Andrews
|
Richard
A. Meserve
|
|
C.
LEE COX
|
MARY
S. METZ
|
|
C.
Lee Cox
|
Mary
S. Metz
|
|
PETER
A. DARBEE
|
FORREST
E. MILLER
|
|
Peter
A. Darbee
|
Forrest
E. Miller
|
|
MARYELLEN
C. HERRINGER
|
BARBARA
L. RAMBO
|
|
Maryellen
C. Herringer
|
Barbara
L. Rambo
|
|
ROGER
H. KIMMEL
|
BARRY
LAWSON WILLIAMS
|
|
Roger
H. Kimmel
|
Barry
Lawson Williams
|
PETER
A. DARBEE
|
Peter
A. Darbee
|
CHRISTOPHER
P. JOHNS
|
Christopher
P. Johns
|
STEPHEN
J. CAIRNS
|
Stephen
J. Cairns
|
DAVID
R. ANDREWS
|
RICHARD
A. MESERVE
|
|
David
R. Andrews
|
Richard
A. Meserve
|
|
C.
LEE COX
|
MARY
S. METZ
|
|
C.
Lee Cox
|
Mary
S. Metz
|
|
PETER
A. DARBEE
|
FORREST
E. MILLER
|
|
Peter
A. Darbee
|
Forrest
E. Miller
|
|
MARYELLEN
C. HERRINGER
|
BARBARA
L. RAMBO
|
|
Maryellen
C. Herringer
|
Barbara
L. Rambo
|
|
ROGER
H. KIMMEL
|
BARRY
LAWSON WILLIAMS
|
|
Roger
H. Kimmel
|
Barry
Lawson Williams
|
PETER
A. DARBEE
|
Peter
A. Darbee
|
BARBARA
L. BARCON
|
Barbara
L. Barcon
|
STEPHEN
J. CAIRNS
|
Stephen
J. Cairns
|
1.
|
I
have reviewed this Annual Report on Form 10-K for the year
ended December 31, 2008 of PG&E
Corporation;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c.
|
Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
functions):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date:
February 24, 2009
|
PETER
A. DARBEE
|
Peter
A. Darbee
|
|
Chairman,
Chief Executive Officer, and
President
|
1.
|
I
have reviewed this Annual Report on Form 10-K for the year ended
December 31, 2008 of PG&E
Corporation;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
c.
|
Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
functions):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date:
February 24, 2009
|
CHRISTOPHER
P. JOHNS
|
Christopher
P. Johns
|
|
Senior
Vice President, Chief Financial Officer and
Treasurer
|
1.
|
I
have reviewed this Annual Report on Form 10-K for the year ended
December 31, 2008 of Pacific Gas and Electric
Company;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c.
|
Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
functions):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date:
February 24, 2009
|
PETER
A. DARBEE
|
Peter
A. Darbee
|
|
President
and Chief Executive Officer
|
1.
|
I
have reviewed this Annual Report on Form 10-K for the year ended December
31, 2008 of Pacific Gas and Electric
Company;
|
2.
|
Based
on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
report;
|
3.
|
Based
on my knowledge, the financial statements, and other financial information
included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this
report;
|
4.
|
The
registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and
have:
|
|
a.
|
Designed
such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being
prepared;
|
|
b.
|
Designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
|
c.
|
Evaluated
the effectiveness of the registrant's disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of
the disclosure controls and procedures, as of the end of the period
covered by this report based on such evaluation;
and
|
|
d.
|
Disclosed
in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth quarter in the case of an annual
report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial
reporting; and
|
5.
|
The
registrant's other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the registrant's auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent
functions):
|
|
a.
|
All
significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record,
process, summarize and report financial information;
and
|
|
b.
|
Any
fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date: February
24, 2009
|
BARBARA
L. BARCON
|
Barbara
L. Barcon
|
|
Vice
President, Finance and Chief Financial
Officer
|
(1)
|
the
Form 10-K fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
|
|
|
(2)
|
the
information contained in the Form 10-K fairly presents, in all material
respects, the financial condition and results of operations of PG&E
Corporation.
|
|
|
|
PETER A.
DARBEE
|
|
PETER
A. DARBEE
|
|
Chairman,
Chief Executive Officer, and President
|
|
(1)
|
the
Form 10-K fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
|
|
|
(2)
|
the
information contained in the Form 10-K fairly presents, in all material
respects, the financial condition and results of operations of PG&E
Corporation.
|
|
CHRISTOPHER P.
JOHNS
|
|
CHRISTOPHER
P. JOHNS
|
|
Senior
Vice President,
|
|
Chief
Financial Officer and Treasurer
|
|
(1)
|
the
Form 10-K fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
|
|
|
(2)
|
the
information contained in the Form 10-K fairly presents, in all material
respects, the financial condition and results of operations of Pacific Gas
and Electric
Company.
|
PETER A.
DARBEE
|
|
PETER
A. DARBEE
|
|
|
President
and Chief Executive Officer
|
(1)
|
the
Form 10-K fully complies with the requirements of section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
|
|
|
(2)
|
the
information contained in the Form 10-K fairly presents, in all material
respects, the financial condition and results of operations of Pacific Gas
and Electric Company.
|
BARBARA L.
BARCON
|
|
BARBARA
L. BARCON
|
|
Vice
President, Finance and Chief Financial Officer
|
|