Securities registered pursuant to Section 12(b) of the Act:
|
||
|
|
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common stock, no par value
|
PCG
|
NYSE
|
First preferred stock, cumulative, par value $25 per share, 5% series A redeemable
|
PCG-PE
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 5% redeemable
|
PCG-PD
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 4.80% redeemable
|
PCG-PG
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 4.50% redeemable
|
PCG-PH
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 4.36% series A redeemable
|
PCG-PI
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 6% nonredeemable
|
PCG-PA
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 5.50% nonredeemable
|
PCG-PB
|
NYSE American
|
First preferred stock, cumulative, par value $25 per share, 5% nonredeemable
|
PCG-PC
|
NYSE American
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 Form 10-K
|
PG&E Corporation and Pacific Gas and Electric Company’s combined Annual Report on Form 10-K for the year ended December 31, 2018
|
2019 Wildfire Safety Plan
|
the wildfire mitigation plan for 2019 submitted by the Utility to the CPUC pursuant to SB 901
|
ALJ
|
administrative law judge
|
ARO
|
asset retirement obligation
|
ASU
|
accounting standard update issued by the FASB (see below)
|
Bankruptcy Code
|
the United States Bankruptcy Code
|
Bankruptcy Court
|
the U.S. Bankruptcy Court for the Northern District of California
|
CAISO
|
California Independent System Operator
|
Cal Fire
|
California Department of Forestry and Fire Protection
|
Cal PA
|
Public Advocates Office of the California Public Utilities Commission (formerly known as Office of Ratepayer Advocates or ORA)
|
CCA
|
Community Choice Aggregator
|
CEC
|
California Energy Resources Conservation and Development Commission
|
CEMA
|
Catastrophic Event Memorandum Account
|
Chapter 11
|
chapter 11 of title 11 of the U.S. Code
|
Chapter 11 Cases
|
the voluntary cases commenced by each of PG&E Corporation and the Utility under Chapter 11 on January 29, 2019
|
CPUC
|
California Public Utilities Commission
|
CRRs
|
congestion revenue rights
|
CWSP
|
Community Wildfire Safety Program
|
DA
|
Direct Access
|
DER
|
distributed energy resources
|
Diablo Canyon
|
Diablo Canyon nuclear power plant
|
DIP Credit Agreement
|
Senior Secured Superpriority Debtor in Possession Credit, Guaranty and Security Agreement, dated as of February 1, 2019, among the Utility, as borrower, PG&E Corporation, as guarantor, JPMorgan Chase Bank, N.A., as administrative agent, and Citibank, N.A., as collateral agent
|
DOGGR
|
Division of Oil, Gas, and Geothermal Resources of the California Department of Conservation
|
DRP
|
Distribution Resource Plan
|
DTSC
|
Department of Toxic Substances Control
|
EPS
|
earnings per common share
|
EV
|
electric vehicle
|
FASB
|
Financial Accounting Standards Board
|
FERC
|
Federal Energy Regulatory Commission
|
FHPMA
|
fire hazard prevention memorandum account
|
FRMMA
|
fire risk mitigation memorandum account
|
GAAP
|
U.S. Generally Accepted Accounting Principles
|
GHG
|
greenhouse gas
|
GRC
|
general rate case
|
GT&S
|
gas transmission and storage
|
HSM
|
hazardous substance memorandum account
|
IOU(s)
|
investor-owned utility(ies)
|
LIBOR
|
London Interbank Offered Rate
|
LSTC
|
liabilities subject to compromise
|
MD&A
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations set forth in Item 2 of this Form 10-Q
|
MGP(s)
|
manufactured gas plants
|
the Monitor
|
third-party monitor retained as part of its compliance with the sentencing terms of the Utility’s January 27, 2017 federal criminal conviction
|
NAV
|
net asset value
|
NDCTP
|
Nuclear Decommissioning Cost Triennial Proceedings
|
NEIL
|
Nuclear Electric Insurance Limited
|
NRC
|
Nuclear Regulatory Commission
|
OES
|
State of California Office of Emergency Services
|
OII
|
order instituting investigation
|
OIR
|
order instituting rulemaking
|
PAO
|
Public Advocates Office of the California Public Utilities Commission (formerly known as Office of Ratepayer Advocates or ORA)
|
PCIA
|
Power Charge Indifference Adjustment
|
PD
|
proposed decision
|
Petition Date
|
January 29, 2019
|
PFM
|
petition for modification
|
RAMP
|
Risk Assessment Mitigation Phase
|
ROE
|
return on equity
|
ROU asset
|
right-of-use asset
|
SB
|
Senate Bill
|
SEC
|
U.S. Securities and Exchange Commission
|
SED
|
Safety and Enforcement Division of the CPUC
|
Strike Force Report
|
California Governor Gavin Newsom’s “Strike Force” report in connection with the issues of wildfire, climate change and the state’s energy sector issued on April 12, 2019
|
Tax Act
|
Tax Cuts and Jobs Act of 2017
|
TE
|
transportation electrification
|
TO
|
transmission owner
|
TURN
|
The Utility Reform Network
|
USAO
|
United States Attorney’s Office for the Northern District of California
|
Utility
|
Pacific Gas and Electric Company
|
VIE(s)
|
variable interest entity(ies)
|
WEMA
|
Wildfire Expense Memorandum Account
|
Wildfire Assistance Fund
|
program to assist those displaced by the 2018 Camp fire and 2017 Northern California wildfires with the costs of temporary housing and other urgent needs
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions, except per share amounts)
|
2019
|
|
2018
|
||||
Operating Revenues
|
|
|
|
||||
Electric
|
$
|
2,792
|
|
|
$
|
2,951
|
|
Natural gas
|
1,219
|
|
|
1,105
|
|
||
Total operating revenues
|
4,011
|
|
|
4,056
|
|
||
Operating Expenses
|
|
|
|
||||
Cost of electricity
|
599
|
|
|
819
|
|
||
Cost of natural gas
|
339
|
|
|
289
|
|
||
Operating and maintenance
|
2,087
|
|
|
1,604
|
|
||
Wildfire-related claims, net of insurance recoveries
|
—
|
|
|
(7
|
)
|
||
Depreciation, amortization, and decommissioning
|
797
|
|
|
752
|
|
||
Total operating expenses
|
3,822
|
|
|
3,457
|
|
||
Operating Income
|
189
|
|
|
599
|
|
||
Interest income
|
22
|
|
|
9
|
|
||
Interest expense
|
(103
|
)
|
|
(220
|
)
|
||
Other income, net
|
71
|
|
|
108
|
|
||
Reorganization items, net
|
(127
|
)
|
|
—
|
|
||
Income Before Income Taxes
|
52
|
|
|
496
|
|
||
Income tax provision (benefit)
|
(84
|
)
|
|
51
|
|
||
Net Income
|
136
|
|
|
445
|
|
||
Preferred stock dividend requirement of subsidiary
|
—
|
|
|
3
|
|
||
Income Available for Common Shareholders
|
$
|
136
|
|
|
$
|
442
|
|
Weighted Average Common Shares Outstanding, Basic
|
526
|
|
|
515
|
|
||
Weighted Average Common Shares Outstanding, Diluted
|
527
|
|
|
516
|
|
||
Net Earnings Per Common Share, Basic
|
$
|
0.25
|
|
|
$
|
0.86
|
|
Net Earnings Per Common Share, Diluted
|
$
|
0.25
|
|
|
$
|
0.86
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Net Income
|
$
|
136
|
|
|
$
|
445
|
|
Other Comprehensive Income
|
|
|
|
||||
Pension and other post-retirement benefit plans obligations (net of taxes of $0, $0, $0, and $0, at respective dates)
|
—
|
|
|
—
|
|
||
Total other comprehensive income
|
—
|
|
|
—
|
|
||
Comprehensive Income
|
136
|
|
|
445
|
|
||
Preferred stock dividend requirement of subsidiary
|
—
|
|
|
3
|
|
||
Comprehensive Income Attributable to
Common Shareholders
|
$
|
136
|
|
|
$
|
442
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Balance At
|
||||||
(in millions)
|
March 31,
2019 |
|
December 31,
2018 |
||||
ASSETS
|
|
|
|
|
|
||
Current Assets
|
|
|
|
|
|||
Cash and cash equivalents
|
$
|
2,964
|
|
|
$
|
1,668
|
|
Accounts receivable:
|
|
|
|
||||
Customers (net of allowance for doubtful accounts of $56
at respective dates)
|
1,319
|
|
|
1,148
|
|
||
Accrued unbilled revenue
|
838
|
|
|
1,000
|
|
||
Regulatory balancing accounts
|
1,497
|
|
|
1,435
|
|
||
Other
|
2,695
|
|
|
2,686
|
|
||
Regulatory assets
|
235
|
|
|
233
|
|
||
Inventories:
|
|
|
|
||||
Gas stored underground and fuel oil
|
72
|
|
|
111
|
|
||
Materials and supplies
|
464
|
|
|
443
|
|
||
Income taxes receivable
|
—
|
|
|
23
|
|
||
Other
|
609
|
|
|
448
|
|
||
Total current assets
|
10,693
|
|
|
9,195
|
|
||
Property, Plant, and Equipment
|
|
|
|
||||
Electric
|
59,982
|
|
|
59,150
|
|
||
Gas
|
21,930
|
|
|
21,556
|
|
||
Construction work in progress
|
2,525
|
|
|
2,564
|
|
||
Other
|
20
|
|
|
2
|
|
||
Total property, plant, and equipment
|
84,457
|
|
|
83,272
|
|
||
Accumulated depreciation
|
(25,220
|
)
|
|
(24,715
|
)
|
||
Net property, plant, and equipment
|
59,237
|
|
|
58,557
|
|
||
Other Noncurrent Assets
|
|
|
|
||||
Regulatory assets
|
5,151
|
|
|
4,964
|
|
||
Nuclear decommissioning trusts
|
2,932
|
|
|
2,730
|
|
||
Operating lease right of use asset
|
2,738
|
|
|
—
|
|
||
Income taxes receivable
|
69
|
|
|
69
|
|
||
Other
|
1,467
|
|
|
1,480
|
|
||
Total other noncurrent assets
|
12,357
|
|
|
9,243
|
|
||
TOTAL ASSETS
|
$
|
82,287
|
|
|
$
|
76,995
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Balance At
|
||||||
(in millions, except share amounts)
|
March 31,
2019 |
|
December 31,
2018 |
||||
LIABILITIES AND EQUITY
|
|
|
|
|
|
||
Current
Liabilities
|
|
|
|
|
|
||
Short-term borrowings
|
$
|
—
|
|
|
$
|
3,435
|
|
Long-term debt, classified as current
|
—
|
|
|
18,559
|
|
||
Accounts payable:
|
|
|
|
||||
Trade creditors
|
867
|
|
|
1,975
|
|
||
Regulatory balancing accounts
|
1,345
|
|
|
1,076
|
|
||
Other
|
453
|
|
|
464
|
|
||
Operating lease liabilities
|
539
|
|
|
—
|
|
||
Disputed claims and customer refunds
|
—
|
|
|
220
|
|
||
Interest payable
|
1
|
|
|
228
|
|
||
Wildfire-related claims
|
—
|
|
|
14,226
|
|
||
Other
|
1,603
|
|
|
1,512
|
|
||
Total current liabilities
|
4,808
|
|
|
41,695
|
|
||
Noncurrent Liabilities
|
|
|
|
||||
Long-term debt
|
—
|
|
|
—
|
|
||
Debtor-in-possession financing
|
350
|
|
|
—
|
|
||
Regulatory liabilities
|
8,872
|
|
|
8,539
|
|
||
Pension and other post-retirement benefits
|
2,006
|
|
|
2,119
|
|
||
Asset retirement obligations
|
6,055
|
|
|
5,994
|
|
||
Deferred income taxes
|
3,273
|
|
|
3,281
|
|
||
Operating lease liabilities
|
2,199
|
|
|
—
|
|
||
Other
|
2,273
|
|
|
2,464
|
|
||
Total noncurrent liabilities
|
25,028
|
|
|
22,397
|
|
||
Liabilities Subject to Compromise
|
39,322
|
|
|
—
|
|
||
Equity
|
|
|
|
||||
Shareholders’ Equity
|
|
|
|
||||
Common stock, no par value, authorized 800,000,000 shares;
529,210,278 and 520,338,710 shares outstanding at respective dates
|
13,000
|
|
|
12,910
|
|
||
Reinvested earnings
|
(114
|
)
|
|
(250
|
)
|
||
Accumulated other comprehensive loss
|
(9
|
)
|
|
(9
|
)
|
||
Total shareholders’
equity
|
12,877
|
|
|
12,651
|
|
||
Noncontrolling Interest - Preferred Stock of Subsidiary
|
252
|
|
|
252
|
|
||
Total equity
|
13,129
|
|
|
12,903
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
82,287
|
|
|
$
|
76,995
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cash Flows from Operating Activities
|
|
|
|
||||
Net income
|
$
|
136
|
|
|
$
|
445
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation, amortization, and decommissioning
|
797
|
|
|
752
|
|
||
Allowance for equity funds used during construction
|
(25
|
)
|
|
(32
|
)
|
||
Deferred income taxes and tax credits, net
|
4
|
|
|
178
|
|
||
Reorganization items, net (Note 2)
|
19
|
|
|
—
|
|
||
Other
|
16
|
|
|
30
|
|
||
Effect of changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(31
|
)
|
|
120
|
|
||
Wildfire-related insurance receivable
|
25
|
|
|
197
|
|
||
Inventories
|
18
|
|
|
28
|
|
||
Accounts payable
|
(180
|
)
|
|
24
|
|
||
Wildfire-related claims
|
(14
|
)
|
|
(118
|
)
|
||
Income taxes receivable/payable
|
23
|
|
|
—
|
|
||
Other current assets and liabilities
|
150
|
|
|
(145
|
)
|
||
Regulatory assets, liabilities, and balancing accounts, net
|
343
|
|
|
114
|
|
||
Liabilities subject to compromise
|
833
|
|
|
—
|
|
||
Other noncurrent assets and liabilities
|
130
|
|
|
(81
|
)
|
||
Net cash provided by operating activities
|
2,244
|
|
|
1,512
|
|
||
Cash Flows from Investing Activities
|
|
|
|
|
|
||
Capital expenditures
|
(1,224
|
)
|
|
(1,470
|
)
|
||
Proceeds from sales and maturities of nuclear decommissioning trust investments
|
346
|
|
|
494
|
|
||
Purchases of nuclear decommissioning trust investments
|
(372
|
)
|
|
(505
|
)
|
||
Other
|
3
|
|
|
6
|
|
||
Net
cash used in investing activities
|
(1,247
|
)
|
|
(1,475
|
)
|
||
Cash Flows from Financing Activities
|
|
|
|
|
|
||
Proceeds from debtor-in-possession credit facility
|
350
|
|
|
—
|
|
||
Debtor-in-possession credit facility debt issuance costs
|
(111
|
)
|
|
—
|
|
||
Net issuances (repayments) of commercial paper, net of discount
|
—
|
|
|
36
|
|
||
Short-term debt financing
|
—
|
|
|
250
|
|
||
Short-term debt matured
|
—
|
|
|
(250
|
)
|
||
Long-term debt matured or repurchased
|
—
|
|
|
(400
|
)
|
||
Common stock issued
|
85
|
|
|
35
|
|
||
Other
|
(24
|
)
|
|
(13
|
)
|
||
Net cash provided by (used in) financing activities
|
300
|
|
|
(342
|
)
|
||
Net change in cash, cash equivalents, and restricted cash
|
1,297
|
|
|
(305
|
)
|
||
Cash, cash equivalents, and restricted cash at January 1
|
1,675
|
|
|
456
|
|
||
Cash, cash equivalents, and restricted cash at March 31
|
$
|
2,972
|
|
|
$
|
151
|
|
Less: Restricted cash and restricted cash equivalents included in other current assets
|
(8
|
)
|
|
$
|
(7
|
)
|
|
Cash and cash equivalents at March 31
|
$
|
2,964
|
|
|
$
|
144
|
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Operating Revenues
|
|
|
|
|
|
||
Electric
|
$
|
2,792
|
|
|
$
|
2,951
|
|
Natural gas
|
1,219
|
|
|
1,105
|
|
||
Total operating revenues
|
4,011
|
|
|
4,056
|
|
||
Operating Expenses
|
|
|
|
||||
Cost of electricity
|
599
|
|
|
819
|
|
||
Cost of natural gas
|
339
|
|
|
289
|
|
||
Operating and maintenance
|
2,104
|
|
|
1,604
|
|
||
Wildfire-related claims, net of insurance recoveries
|
—
|
|
|
(7
|
)
|
||
Depreciation, amortization, and decommissioning
|
797
|
|
|
752
|
|
||
Total operating expenses
|
3,839
|
|
|
3,457
|
|
||
Operating Income
|
172
|
|
|
599
|
|
||
Interest income
|
21
|
|
|
9
|
|
||
Interest expense
|
(101
|
)
|
|
(217
|
)
|
||
Other income, net
|
66
|
|
|
109
|
|
||
Reorganization items, net
|
(111
|
)
|
|
—
|
|
||
Income Before Income Taxes
|
47
|
|
|
500
|
|
||
Income tax provision (benefit)
|
(86
|
)
|
|
48
|
|
||
Net Income
|
133
|
|
|
452
|
|
||
Preferred stock dividend requirement
|
—
|
|
|
3
|
|
||
Income Available for Common Stock
|
$
|
133
|
|
|
$
|
449
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Net Income
|
$
|
133
|
|
|
$
|
452
|
|
Other Comprehensive Income
|
|
|
|
||||
Pension and other post-retirement benefit plans obligations (net of taxes of $0, $0, $0, and $0, at respective dates )
|
—
|
|
|
—
|
|
||
Total other comprehensive income
|
—
|
|
|
—
|
|
||
Comprehensive Income
|
$
|
133
|
|
|
$
|
452
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Balance At
|
||||||
|
March 31,
2019 |
|
December 31, 2018
|
||||
(in millions)
|
|
||||||
ASSETS
|
|
|
|
|
|
||
Current Assets
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
2,552
|
|
|
$
|
1,295
|
|
Accounts receivable:
|
|
|
|
||||
Customers (net of allowance for doubtful accounts of $56
at respective dates)
|
1,319
|
|
|
1,148
|
|
||
Accrued unbilled revenue
|
838
|
|
|
1,000
|
|
||
Regulatory balancing accounts
|
1,497
|
|
|
1,435
|
|
||
Other
|
2,716
|
|
|
2,688
|
|
||
Regulatory assets
|
235
|
|
|
233
|
|
||
Inventories:
|
|
|
|
||||
Gas stored underground and fuel oil
|
72
|
|
|
111
|
|
||
Materials and supplies
|
464
|
|
|
443
|
|
||
Income taxes receivable
|
—
|
|
|
5
|
|
||
Other
|
609
|
|
|
448
|
|
||
Total current assets
|
10,302
|
|
|
8,806
|
|
||
Property, Plant, and Equipment
|
|
|
|
||||
Electric
|
59,982
|
|
|
59,150
|
|
||
Gas
|
21,930
|
|
|
21,556
|
|
||
Construction work in progress
|
2,525
|
|
|
2,564
|
|
||
Other
|
18
|
|
|
—
|
|
||
Total property, plant, and equipment
|
84,455
|
|
|
83,270
|
|
||
Accumulated depreciation
|
(25,217
|
)
|
|
(24,713
|
)
|
||
Net property, plant, and equipment
|
59,238
|
|
|
58,557
|
|
||
Other Noncurrent Assets
|
|
|
|
||||
Regulatory assets
|
5,151
|
|
|
4,964
|
|
||
Nuclear decommissioning trusts
|
2,932
|
|
|
2,730
|
|
||
Operating lease right of use asset
|
2,728
|
|
|
—
|
|
||
Income taxes receivable
|
66
|
|
|
66
|
|
||
Other
|
1,330
|
|
|
1,348
|
|
||
Total other noncurrent assets
|
12,207
|
|
|
9,108
|
|
||
TOTAL ASSETS
|
$
|
81,747
|
|
|
$
|
76,471
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Balance At
|
||||||
|
March 31,
2019 |
|
December 31, 2018
|
||||
(in millions. except share amounts)
|
|
||||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current Liabilities
|
|
|
|
|
|
||
Short-term borrowings
|
$
|
—
|
|
|
$
|
3,135
|
|
Long-term debt, classified as current
|
—
|
|
|
18,209
|
|
||
Accounts payable:
|
|
|
|
||||
Trade creditors
|
863
|
|
|
1,972
|
|
||
Regulatory balancing accounts
|
1,345
|
|
|
1,076
|
|
||
Other
|
553
|
|
|
498
|
|
||
Operating lease liabilities
|
536
|
|
|
—
|
|
||
Disputed claims and customer refunds
|
—
|
|
|
220
|
|
||
Interest payable
|
1
|
|
|
227
|
|
||
Wildfire-related claims
|
—
|
|
|
14,226
|
|
||
Other
|
1,620
|
|
|
1,497
|
|
||
Total current liabilities
|
4,918
|
|
|
41,060
|
|
||
Noncurrent Liabilities
|
|
|
|
||||
Long-term debt
|
—
|
|
|
—
|
|
||
Debtor-in-possession financing
|
350
|
|
|
—
|
|
||
Regulatory liabilities
|
8,872
|
|
|
8,539
|
|
||
Pension and other post-retirement benefits
|
2,006
|
|
|
2,026
|
|
||
Asset retirement obligations
|
6,055
|
|
|
5,994
|
|
||
Deferred income taxes
|
3,396
|
|
|
3,405
|
|
||
Operating lease liabilities
|
2,192
|
|
|
—
|
|
||
Other
|
2,323
|
|
|
2,492
|
|
||
Total noncurrent liabilities
|
25,194
|
|
|
22,456
|
|
||
Liabilities Subject to Compromise
|
38,547
|
|
|
—
|
|
||
Shareholders’ Equity
|
|
|
|
||||
Preferred stock
|
258
|
|
|
258
|
|
||
Common stock, $5 par value, authorized 800,000,000 shares; 264,374,809 shares outstanding at respective dates
|
1,322
|
|
|
1,322
|
|
||
Additional paid-in capital
|
8,550
|
|
|
8,550
|
|
||
Reinvested earnings
|
2,959
|
|
|
2,826
|
|
||
Accumulated other comprehensive income
|
(1
|
)
|
|
(1
|
)
|
||
Total shareholders’ equity
|
13,088
|
|
|
12,955
|
|
||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$
|
81,747
|
|
|
$
|
76,471
|
|
|
|
|
|
||||
See accompanying Notes to the Condensed Consolidated Financial Statements.
|
|
(Unaudited)
|
||||||
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cash Flows from Operating Activities
|
|
|
|
|
|
||
Net income
|
$
|
133
|
|
|
$
|
452
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation, amortization, and decommissioning
|
797
|
|
|
752
|
|
||
Allowance for equity funds used during construction
|
(25
|
)
|
|
(32
|
)
|
||
Deferred income taxes and tax credits, net
|
2
|
|
|
175
|
|
||
Reorganization items, net (Note 2)
|
20
|
|
|
—
|
|
||
Other
|
12
|
|
|
(1
|
)
|
||
Effect of changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(51
|
)
|
|
112
|
|
||
Wildfire-related insurance receivable
|
25
|
|
|
197
|
|
||
Inventories
|
18
|
|
|
28
|
|
||
Accounts payable
|
(132
|
)
|
|
55
|
|
||
Wildfire-related claims
|
(14
|
)
|
|
(118
|
)
|
||
Income taxes receivable/payable
|
5
|
|
|
—
|
|
||
Other current assets and liabilities
|
171
|
|
|
(131
|
)
|
||
Regulatory assets, liabilities, and balancing accounts, net
|
343
|
|
|
114
|
|
||
Liabilities subject to compromise
|
833
|
|
|
—
|
|
||
Other noncurrent assets and liabilities
|
137
|
|
|
(87
|
)
|
||
Net cash provided by operating activities
|
2,274
|
|
|
1,516
|
|
||
Cash Flows from Investing Activities
|
|
|
|
||||
Capital expenditures
|
(1,224
|
)
|
|
(1,470
|
)
|
||
Proceeds from sales and maturities of nuclear decommissioning trust investments
|
346
|
|
|
494
|
|
||
Purchases of nuclear decommissioning trust investments
|
(372
|
)
|
|
(505
|
)
|
||
Other
|
3
|
|
|
6
|
|
||
Net
cash used in investing activities
|
(1,247
|
)
|
|
(1,475
|
)
|
||
Cash Flows from Financing Activities
|
|
|
|
||||
Proceeds from debtor-in-possession credit facility
|
350
|
|
|
—
|
|
||
Debtor-in-possession credit facility debt issuance costs
|
(95
|
)
|
|
—
|
|
||
Net issuances (repayments) of commercial paper, net of discount
|
—
|
|
|
47
|
|
||
Short-term debt financing
|
—
|
|
|
250
|
|
||
Short-term debt matured
|
—
|
|
|
(250
|
)
|
||
Long-term debt matured or repurchased
|
—
|
|
|
(400
|
)
|
||
Other
|
(24
|
)
|
|
(13
|
)
|
||
Net cash provided by (used in) financing activities
|
231
|
|
|
(366
|
)
|
||
Net change in cash, cash equivalents, and restricted cash
|
1,258
|
|
|
(325
|
)
|
||
Cash, cash equivalents, and restricted cash at January 1
|
1,302
|
|
|
454
|
|
||
Cash, cash equivalents, and restricted cash at March 31
|
$
|
2,560
|
|
|
$
|
129
|
|
Less: Restricted cash and restricted cash equivalents included in other current assets
|
(8
|
)
|
|
(7
|
)
|
||
Cash and cash equivalents at March 31
|
$
|
2,552
|
|
|
$
|
122
|
|
(in millions)
|
PG&E Corporation
(1)
|
|
Utility
|
|
PG&E Corporation Consolidated
|
||||||
Financing debt
(2)
|
$
|
650
|
|
|
$
|
21,811
|
|
|
$
|
22,461
|
|
Wildfire-related claims
(3)
|
—
|
|
|
14,212
|
|
|
14,212
|
|
|||
Trade creditors
|
1
|
|
|
1,850
|
|
|
1,851
|
|
|||
Non-qualified benefit plan
|
122
|
|
|
17
|
|
|
139
|
|
|||
2001 bankruptcy disputed claims
|
—
|
|
|
221
|
|
|
221
|
|
|||
Customer deposits & advances
|
—
|
|
|
272
|
|
|
272
|
|
|||
Other
|
2
|
|
|
164
|
|
|
166
|
|
|||
Total Liabilities Subject to Compromise
|
$
|
775
|
|
|
$
|
38,547
|
|
|
$
|
39,322
|
|
|
|
|
|
|
|
|
Post-Petition Period Through March 31, 2019
|
||||||||||
(in millions)
|
PG&E Corporation
(1)
|
|
Utility
|
|
PG&E Corporation Consolidated
|
||||||
Debtor-in-possession financing costs
|
17
|
|
|
97
|
|
|
114
|
|
|||
Legal and other
|
$
|
1
|
|
|
$
|
23
|
|
|
$
|
24
|
|
Interest income
|
(2
|
)
|
|
(9
|
)
|
|
(11
|
)
|
|||
Total reorganization items, net
|
$
|
16
|
|
|
$
|
111
|
|
|
$
|
127
|
|
|
|
|
|
|
|
|
Pension Benefits
|
|
Other Benefits
|
||||||||||||
|
Three Months Ended March 31,
|
||||||||||||||
(in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Service cost for benefits earned
(1)
|
$
|
111
|
|
|
$
|
128
|
|
|
$
|
14
|
|
|
$
|
16
|
|
Interest cost
|
189
|
|
|
172
|
|
|
19
|
|
|
17
|
|
||||
Expected return on plan assets
|
(227
|
)
|
|
(255
|
)
|
|
(31
|
)
|
|
(33
|
)
|
||||
Amortization of prior service cost
|
(1
|
)
|
|
(1
|
)
|
|
4
|
|
|
4
|
|
||||
Amortization of net actuarial loss
|
1
|
|
|
1
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Net periodic benefit cost
|
73
|
|
|
45
|
|
|
5
|
|
|
3
|
|
||||
Regulatory account transfer
(2)
|
10
|
|
|
39
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
83
|
|
|
$
|
84
|
|
|
$
|
5
|
|
|
$
|
3
|
|
|
|
|
|
|
|
|
|
|
Pension
Benefits |
|
Other
Benefits |
|
Total
|
||||||
(in millions, net of income tax)
|
Three Months Ended March 31, 2019
|
||||||||||
Beginning balance
|
$
|
(21
|
)
|
|
$
|
17
|
|
|
$
|
(4
|
)
|
Amounts reclassified from other comprehensive income:
|
|
|
|
|
|
||||||
Amortization of prior service cost (net of taxes of $0 and $1, respectively)
(1)
|
(1
|
)
|
|
3
|
|
|
2
|
|
|||
Amortization of net actuarial loss (net of taxes of $0 and $0, respectively)
(1)
|
1
|
|
|
(1
|
)
|
|
—
|
|
|||
Regulatory account transfer (net of taxes of $0 and $1, respectively)
(1)
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||
Net current period other comprehensive gain (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Ending balance
|
$
|
(21
|
)
|
|
$
|
17
|
|
|
$
|
(4
|
)
|
|
|
|
|
|
|
|
Pension Benefits
|
|
Other
Benefits |
|
Total
|
||||||
(in millions, net of income tax)
|
Three Months Ended March 31, 2018
|
||||||||||
Beginning balance
|
$
|
(25
|
)
|
|
$
|
17
|
|
|
$
|
(8
|
)
|
Amounts reclassified from other comprehensive income:
(1)
|
|
|
|
|
|
||||||
Amortization of prior service cost (net of taxes of $0 and $1, respectively)
|
(1
|
)
|
|
3
|
|
|
2
|
|
|||
Amortization of net actuarial loss (net of taxes of $0 and $0, respectively)
|
1
|
|
|
(1
|
)
|
|
—
|
|
|||
Regulatory account transfer (net of taxes of $0 and $1, respectively)
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||
Reclassification of stranded income tax to retained earnings (net of taxes of $0 and $0, respectively)
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Net current period other comprehensive gain (loss)
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|||
Ending balance
|
$
|
(30
|
)
|
|
$
|
17
|
|
|
$
|
(13
|
)
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Electric
|
|
|
|
||||
Revenue from contracts with customers
|
|
|
|
||||
Residential
|
$
|
1,288
|
|
|
$
|
1,336
|
|
Commercial
|
953
|
|
|
1,073
|
|
||
Industrial
|
293
|
|
|
324
|
|
||
Agricultural
|
86
|
|
|
125
|
|
||
Public street and highway lighting
|
17
|
|
|
20
|
|
||
Other
(1)
|
(309
|
)
|
|
(201
|
)
|
||
Total revenue from contracts with customers - electric
|
2,328
|
|
|
2,677
|
|
||
Regulatory balancing accounts
(2)
|
464
|
|
|
274
|
|
||
Total electric operating revenue
|
$
|
2,792
|
|
|
$
|
2,951
|
|
|
|
|
|
||||
Natural gas
|
|
|
|
||||
Revenue from contracts with customers
|
|
|
|
||||
Residential
|
$
|
1,171
|
|
|
$
|
958
|
|
Commercial
|
240
|
|
|
196
|
|
||
Transportation service only
|
382
|
|
|
297
|
|
||
Other
(1)
|
(75
|
)
|
|
(52
|
)
|
||
Total revenue from contracts with customers - gas
|
1,718
|
|
|
1,399
|
|
||
Regulatory balancing accounts
(2)
|
(499
|
)
|
|
(294
|
)
|
||
Total natural gas operating revenue
|
1,219
|
|
|
1,105
|
|
||
Total operating revenues
|
$
|
4,011
|
|
|
$
|
4,056
|
|
|
|
|
|
(in millions)
|
Three Months Ended March 31, 2019
|
||
Operating lease fixed cost
|
$
|
122
|
|
Operating lease variable cost
|
309
|
|
|
Total operating lease costs
|
$
|
431
|
|
(in millions)
|
March 31, 2019
|
||
2019
|
$
|
686
|
|
2020
|
669
|
|
|
2021
|
616
|
|
|
2022
|
523
|
|
|
2023
|
195
|
|
|
Thereafter
|
672
|
|
|
Total lease payments
|
3,361
|
|
|
Less imputed interest
|
(633
|
)
|
|
Total
|
$
|
2,728
|
|
(in millions)
|
December 31, 2018
|
||
2019
|
$
|
684
|
|
2020
|
677
|
|
|
2021
|
621
|
|
|
2022
|
546
|
|
|
2023
|
252
|
|
|
Thereafter
|
581
|
|
|
Total lease commitments
|
$
|
3,361
|
|
|
Asset Balance at
|
||||||
(in millions)
|
March 31, 2019
|
|
December 31, 2018
|
||||
Pension benefits
(1)
|
$
|
1,938
|
|
|
$
|
1,947
|
|
Environmental compliance costs
|
932
|
|
|
1,013
|
|
||
Utility retained generation
(2)
|
262
|
|
|
274
|
|
||
Price risk management
|
65
|
|
|
90
|
|
||
Unamortized loss, net of gain, on reacquired debt
(3)
|
237
|
|
|
76
|
|
||
Catastrophic event memorandum account
(4)
|
865
|
|
|
790
|
|
||
Wildfire expense memorandum account
(5)
|
111
|
|
|
94
|
|
||
Fire hazard prevention memorandum account
(6)
|
329
|
|
|
263
|
|
||
Other
|
412
|
|
|
417
|
|
||
Total long-term regulatory assets
|
$
|
5,151
|
|
|
$
|
4,964
|
|
|
|
|
|
|
Liability Balance at
|
||||||
(in millions)
|
March 31, 2019
|
|
December 31, 2018
|
||||
Cost of removal obligations
(1)
|
$
|
6,134
|
|
|
$
|
5,981
|
|
Deferred income taxes
(2)
|
142
|
|
|
283
|
|
||
Recoveries in excess of AROs
(3)
|
471
|
|
|
356
|
|
||
Public purpose programs
(4)
|
758
|
|
|
674
|
|
||
Retirement Plan
(5)
|
422
|
|
|
421
|
|
||
Other
|
945
|
|
|
824
|
|
||
Total long-term regulatory liabilities
|
$
|
8,872
|
|
|
$
|
8,539
|
|
|
|
|
|
|
Receivable Balance at
|
||||||
(in millions)
|
March 31, 2019
|
|
December 31, 2018
|
||||
Electric distribution
|
$
|
449
|
|
|
$
|
160
|
|
Electric transmission
|
128
|
|
|
128
|
|
||
Utility generation
|
357
|
|
|
79
|
|
||
Gas distribution and transmission
|
70
|
|
|
462
|
|
||
Energy procurement
|
137
|
|
|
168
|
|
||
Public purpose programs
|
76
|
|
|
111
|
|
||
Other
|
280
|
|
|
327
|
|
||
Total regulatory balancing accounts receivable
|
$
|
1,497
|
|
|
$
|
1,435
|
|
|
Payable Balance at
|
||||||
(in millions)
|
March 31, 2019
|
|
December 31, 2018
|
||||
Electric transmission
|
146
|
|
|
134
|
|
||
Gas distribution and transmission
|
51
|
|
|
9
|
|
||
Energy procurement
|
223
|
|
|
59
|
|
||
Public purpose programs
|
600
|
|
|
587
|
|
||
Other
|
325
|
|
|
287
|
|
||
Total regulatory balancing accounts payable
|
$
|
1,345
|
|
|
$
|
1,076
|
|
(in millions)
|
Termination
Date
|
|
Limit
|
|
|
Letters of Credit Outstanding
|
|
Borrowings Against DIP Revolving Facility
|
|
Availability
|
||||||||
DIP Facilities
|
December 2020
|
(1)
|
$
|
1,500
|
|
(2)
|
|
$
|
131
|
|
|
$
|
350
|
|
|
$
|
1,019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at,
|
||||||
(in millions)
|
|
Contractual Interest Rates
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Debt Subject to Compromise
(1)
|
|
|
|
|
|
|
||||
PG&E Corporation
|
|
|
|
|
|
|
||||
Borrowings under Pre-Petition Credit Facilities
|
|
|
|
|
|
|
||||
PG&E Corporation Revolving Credit Facilities - Stated Maturity: 2022
|
|
variable rate
(2)
|
|
$
|
300
|
|
|
$
|
300
|
|
Other borrowings:
|
|
|
|
|
|
|
||||
Term Loan - Stated Maturity: 2020
|
|
variable rate
(3)
|
|
350
|
|
|
350
|
|
||
Total PG&E Corporation Debt Subject to Compromise
|
|
|
|
650
|
|
|
650
|
|
||
|
|
|
|
|
|
|
||||
Utility
|
|
|
|
|
|
|
||||
Senior Notes - Stated Maturity:
|
|
|
|
|
|
|
||||
2020
|
|
3.50%
|
|
800
|
|
|
800
|
|
||
2021
|
|
3.25% to 4.25%
|
|
550
|
|
|
550
|
|
||
2022
|
|
2.45%
|
|
400
|
|
|
400
|
|
||
2023
|
|
3.25% to 4.25%
|
|
1,175
|
|
|
1,175
|
|
||
2024 through 2046
|
|
2.95% to 6.35%
|
|
14,600
|
|
|
14,600
|
|
||
Unamortized discount, net or premium and debt issuance costs
|
|
|
|
—
|
|
|
(178
|
)
|
||
Total Senior notes, net of premium and debt issuance costs
|
|
|
|
17,525
|
|
|
17,347
|
|
||
Pollution Control Bonds - Stated Maturity:
|
|
|
|
|
|
|
||||
Series 2008 F and 2010 E, due 2026
(4)
|
|
1.75%
|
|
100
|
|
|
100
|
|
||
Series 2009 A-B, due 2026
(5)
|
|
variable rate
(6)
|
|
149
|
|
|
149
|
|
||
Series 1996 C, E, F, 1997 B due 2026
(5)
|
|
variable rate
(7)
|
|
614
|
|
|
614
|
|
||
Total pollution control bonds
|
|
|
|
863
|
|
|
863
|
|
||
Borrowings under Pre-Petition Credit Facilities
|
|
|
|
|
|
|
||||
Utility Revolving Credit Facilities - Stated Maturity: 2022
(8)
|
|
variable rate
(9)
|
|
2,965
|
|
|
2,965
|
|
||
Other borrowings:
|
|
|
|
|
|
|
||||
Term Loan - Stated Maturity: 2019
|
|
variable rate
(10)
|
|
250
|
|
|
250
|
|
||
Total Borrowings under Pre-Petition Credit Facility Subject to Compromise
|
|
|
|
3,215
|
|
|
3,215
|
|
||
Total Utility Debt Subject to Compromise
|
|
|
|
21,603
|
|
|
21,425
|
|
||
Total PG&E Corporation Consolidated Debt Subject to Compromise
|
|
|
|
$
|
22,253
|
|
|
$
|
22,075
|
|
|
|
|
|
|
|
|
(in millions, except share amounts)
|
Common
Stock
Shares
|
|
Common
Stock
Amount
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income
(Loss)
|
|
Total
Shareholders’
Equity
|
|
Non
controlling
Interest -
Preferred
Stock of
Subsidiary
|
|
Total
Equity
|
|||||||||||||
Balance at December 31, 2018
|
520,338,710
|
|
|
$
|
12,910
|
|
|
$
|
(250
|
)
|
|
$
|
(9
|
)
|
|
$
|
12,651
|
|
|
$
|
252
|
|
|
$
|
12,903
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
136
|
|
|
—
|
|
|
136
|
|
|
—
|
|
|
136
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock issued, net
|
8,871,568
|
|
|
85
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|
—
|
|
|
85
|
|
||||||
Stock-based compensation amortization
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
5
|
|
||||||
Balance at March 31, 2019
|
529,210,278
|
|
|
$
|
13,000
|
|
|
$
|
(114
|
)
|
|
$
|
(9
|
)
|
|
$
|
12,877
|
|
|
$
|
252
|
|
|
$
|
13,129
|
|
(in millions, except share amounts)
|
Common
Stock
Shares
|
|
Common
Stock
Amount
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income
(Loss)
|
|
Total
Shareholders’
Equity
|
|
Non
controlling
Interest -
Preferred
Stock of
Subsidiary
|
|
Total
Equity
|
|||||||||||||
Balance at December 31, 2017
|
514,775,845
|
|
|
$
|
12,632
|
|
|
$
|
6,596
|
|
|
$
|
(8
|
)
|
|
$
|
19,220
|
|
|
$
|
252
|
|
|
$
|
19,472
|
|
Net income
|
—
|
|
|
—
|
|
|
445
|
|
|
—
|
|
|
445
|
|
|
—
|
|
|
445
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock issued, net
|
1,248,112
|
|
|
35
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|
—
|
|
|
35
|
|
||||||
Stock-based compensation amortization
|
—
|
|
|
34
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
34
|
|
||||||
Preferred stock dividend requirement of
subsidiary
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Balance at March 31, 2018
|
516,023,957
|
|
|
$
|
12,701
|
|
|
$
|
7,038
|
|
|
$
|
(8
|
)
|
|
$
|
19,731
|
|
|
$
|
252
|
|
|
$
|
19,983
|
|
(in millions)
|
Preferred
Stock
|
|
Common
Stock Amount |
|
Additional
Paid-in
Capital
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
Shareholders’
Equity
|
||||||||||||
Balance at December 31, 2018
|
$
|
258
|
|
|
$
|
1,322
|
|
|
$
|
8,550
|
|
|
$
|
2,826
|
|
|
$
|
(1
|
)
|
|
$
|
12,955
|
|
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
133
|
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Equity contribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Preferred stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Balance at March 31, 2019
|
$
|
258
|
|
|
$
|
1,322
|
|
|
$
|
8,550
|
|
|
$
|
2,959
|
|
|
$
|
(1
|
)
|
|
$
|
13,088
|
|
(in millions)
|
Preferred
Stock
|
|
Common
Stock Amount |
|
Additional
Paid-in
Capital
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Total
Shareholders’
Equity
|
||||||||||||
Balance at December 31, 2017
|
258
|
|
|
1,322
|
|
|
8,505
|
|
|
9,656
|
|
|
6
|
|
|
$
|
19,747
|
|
|||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
452
|
|
|
—
|
|
|
452
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
||||||
Equity contribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Preferred stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||||
Balance at March 31, 2018
|
$
|
258
|
|
|
$
|
1,322
|
|
|
$
|
8,505
|
|
|
$
|
10,107
|
|
|
$
|
4
|
|
|
$
|
20,196
|
|
|
Three Months Ended March 31,
|
||||||
(in millions, except per share amounts)
|
2019
|
|
2018
|
||||
Income available for common shareholders
|
$
|
136
|
|
|
$
|
445
|
|
Preferred stock dividend requirement of subsidiary
|
3
|
|
|
3
|
|
||
Adjusted income available for common shareholders
|
133
|
|
|
442
|
|
||
Weighted average common shares outstanding, basic
|
526
|
|
|
515
|
|
||
Add incremental shares from assumed conversions:
|
|
|
|
||||
Employee share-based compensation
|
1
|
|
|
1
|
|
||
Weighted average common shares outstanding, diluted
|
527
|
|
|
516
|
|
||
Total earnings per common share, diluted
|
$
|
0.25
|
|
|
$
|
0.86
|
|
|
|
|
|
Contract Volume at
|
||||
Underlying Product
|
|
Instruments
|
|
March 31,
2019 |
|
December 31,
2018 |
||
Natural Gas
(1)
(MMBtus
(2)
)
|
|
Forwards, Futures and Swaps
|
|
138,016,980
|
|
|
177,750,349
|
|
|
|
Options
|
|
4,115,000
|
|
|
13,735,405
|
|
Electricity (Megawatt-hours)
|
|
Forwards, Futures and Swaps
|
|
3,011,826
|
|
|
3,833,490
|
|
|
|
Congestion Revenue Rights
(3)
|
|
335,556,726
|
|
|
340,783,089
|
|
|
|
|
|
|
|
|
|
Commodity Risk
|
||||||||||||||
(in millions)
|
Gross Derivative
Balance
|
|
Netting
|
|
Cash Collateral
|
|
Total
Derivative
Balance
|
||||||||
Current assets – other
|
$
|
45
|
|
|
$
|
(2
|
)
|
|
$
|
38
|
|
|
$
|
81
|
|
Other noncurrent assets – other
|
165
|
|
|
1
|
|
|
—
|
|
|
166
|
|
||||
Current liabilities – other
|
(37
|
)
|
|
17
|
|
|
3
|
|
|
(17
|
)
|
||||
Noncurrent liabilities – other
|
(49
|
)
|
|
(16
|
)
|
|
—
|
|
|
(65
|
)
|
||||
Total commodity risk
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
41
|
|
|
$
|
165
|
|
|
Commodity Risk
|
||||||||||||||
(in millions)
|
Gross Derivative
Balance
|
|
Netting
|
|
Cash Collateral
|
|
Total Derivative
Balance
|
||||||||
Current assets – other
|
$
|
44
|
|
|
$
|
(1
|
)
|
|
$
|
89
|
|
|
$
|
132
|
|
Other noncurrent assets – other
|
165
|
|
|
—
|
|
|
—
|
|
|
165
|
|
||||
Current liabilities – other
|
(29
|
)
|
|
1
|
|
|
7
|
|
|
(21
|
)
|
||||
Noncurrent liabilities – other
|
(90
|
)
|
|
—
|
|
|
2
|
|
|
(88
|
)
|
||||
Total commodity risk
|
$
|
90
|
|
|
$
|
—
|
|
|
$
|
98
|
|
|
$
|
188
|
|
•
|
Level 1 –
Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
|
•
|
Level 2 –
Other inputs that are directly or indirectly observable in the marketplace.
|
•
|
Level 3 –
Unobservable inputs which are supported by little or no market activities.
|
|
Fair Value Measurements
|
||||||||||||||||||
|
March 31, 2019
|
||||||||||||||||||
(in millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
$
|
2,898
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,898
|
|
Nuclear decommissioning trusts
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Global equity securities
|
1,882
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,882
|
|
|||||
Fixed-income securities
|
790
|
|
|
692
|
|
|
—
|
|
|
—
|
|
|
1,482
|
|
|||||
Assets measured at NAV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|||||
Total nuclear decommissioning trusts
(2)
|
2,690
|
|
|
692
|
|
|
—
|
|
|
—
|
|
|
3,400
|
|
|||||
Price risk management instruments (Note 8)
|
|
|
|
|
|
|
|
|
|
||||||||||
Electricity
|
—
|
|
|
1
|
|
|
209
|
|
|
15
|
|
|
225
|
|
|||||
Gas
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
|
22
|
|
|||||
Total price risk management instruments
|
—
|
|
|
1
|
|
|
209
|
|
|
37
|
|
|
247
|
|
|||||
Rabbi trusts
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-income securities
|
—
|
|
|
96
|
|
|
—
|
|
|
—
|
|
|
96
|
|
|||||
Life insurance contracts
|
—
|
|
|
69
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|||||
Total rabbi trusts
|
—
|
|
|
165
|
|
|
—
|
|
|
—
|
|
|
165
|
|
|||||
Long-term disability trust
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|||||
Assets measured at NAV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
146
|
|
|||||
Total long-term disability trust
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|||||
TOTAL ASSETS
|
$
|
5,596
|
|
|
$
|
858
|
|
|
$
|
209
|
|
|
$
|
37
|
|
|
$
|
6,864
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Price risk management instruments (Note 8)
|
|
|
|
|
|
|
|
|
|
||||||||||
Electricity
|
$
|
1
|
|
|
$
|
3
|
|
|
$
|
80
|
|
|
$
|
(4
|
)
|
|
$
|
80
|
|
Gas
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
TOTAL LIABILITIES
|
$
|
1
|
|
|
$
|
5
|
|
|
$
|
80
|
|
|
$
|
(4
|
)
|
|
$
|
82
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value Measurements
|
||||||||||||||||||
|
December 31, 2018
|
||||||||||||||||||
(in millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
$
|
1,593
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,593
|
|
Nuclear decommissioning trusts
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
29
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|||||
Global equity securities
|
1,793
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,793
|
|
|||||
Fixed-income securities
|
661
|
|
|
639
|
|
|
—
|
|
|
—
|
|
|
1,300
|
|
|||||
Assets measured at NAV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16
|
|
|||||
Total nuclear decommissioning trusts
(2)
|
2,483
|
|
|
639
|
|
|
—
|
|
|
—
|
|
|
3,138
|
|
|||||
Price risk management instruments (Note 8)
|
|
|
|
|
|
|
|
|
|
||||||||||
Electricity
|
—
|
|
|
5
|
|
|
203
|
|
|
51
|
|
|
259
|
|
|||||
Gas
|
—
|
|
|
1
|
|
|
—
|
|
|
37
|
|
|
38
|
|
|||||
Total price risk management instruments
|
—
|
|
|
6
|
|
|
203
|
|
|
88
|
|
|
297
|
|
|||||
Rabbi trusts
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed-income securities
|
—
|
|
|
93
|
|
|
—
|
|
|
—
|
|
|
93
|
|
|||||
Life insurance contracts
|
—
|
|
|
67
|
|
|
—
|
|
|
—
|
|
|
67
|
|
|||||
Total rabbi trusts
|
—
|
|
|
160
|
|
|
—
|
|
|
—
|
|
|
160
|
|
|||||
Long-term disability trust
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term investments
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|||||
Assets measured at NAV
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
155
|
|
|||||
Total long-term disability trust
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
162
|
|
|||||
TOTAL ASSETS
|
$
|
4,083
|
|
|
$
|
805
|
|
|
$
|
203
|
|
|
$
|
88
|
|
|
$
|
5,350
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Price risk management instruments (Note 8)
|
|
|
|
|
|
|
|
|
|
||||||||||
Electricity
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
108
|
|
|
$
|
(10
|
)
|
|
$
|
107
|
|
Gas
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||
TOTAL LIABILITIES
|
$
|
4
|
|
|
$
|
7
|
|
|
$
|
108
|
|
|
$
|
(10
|
)
|
|
$
|
109
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value at
|
|
|
|
|
|
|
||||||
(in millions)
|
|
March 31, 2019
|
|
|
|
|
|
|
||||||
Fair Value Measurement
|
|
Assets
|
|
Liabilities
|
|
Valuation
Technique |
|
Unobservable
Input |
|
Range
(1)
|
||||
Congestion revenue rights
|
|
$
|
203
|
|
|
$
|
60
|
|
|
Market approach
|
|
CRR auction prices
|
|
$(36.87) - 23.04
|
Power purchase agreements
|
|
$
|
6
|
|
|
$
|
20
|
|
|
Discounted cash flow
|
|
Forward prices
|
|
$ 19.81 - 38.80
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair Value at
|
|
|
|
|
|
|
||||||
(in millions)
|
|
December 31, 2018
|
|
|
|
|
|
|
||||||
Fair Value Measurement
|
|
Assets
|
|
Liabilities
|
|
Valuation Technique
|
|
Unobservable Input
|
|
Range
(1)
|
||||
Congestion revenue rights
|
|
$
|
203
|
|
|
$
|
75
|
|
|
Market approach
|
|
CRR auction prices
|
|
$ (18.61) - 32.26
|
Power purchase agreements
|
|
$
|
—
|
|
|
$
|
33
|
|
|
Discounted cash flow
|
|
Forward prices
|
|
$ 19.81 - 38.80
|
|
|
|
|
|
|
|
|
|
|
|
|
Price Risk Management Instruments
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Asset (liability) balance as of January 1
|
$
|
95
|
|
|
$
|
42
|
|
Net realized and unrealized gains:
|
|
|
|
||||
Included in regulatory assets and liabilities or balancing accounts
(1)
|
34
|
|
|
(2
|
)
|
||
Asset (liability) balance as of March 31
|
$
|
129
|
|
|
$
|
40
|
|
|
|
|
|
|
At March 31, 2019
|
|
At December 31, 2018
|
||||||||||
(in millions)
|
Carrying Amount
|
|
Level 2 Fair Value
|
|
Carrying Amount
|
|
Level 2 Fair Value
|
||||||
PG&E Corporation
(1)
|
—
|
|
|
—
|
|
|
$
|
350
|
|
|
$
|
350
|
|
Utility
(1)(2)
|
350
|
|
|
350
|
|
|
17,450
|
|
|
14,747
|
|
||
|
|
|
|
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
||||||||
As of March 31, 2019
|
Amortized
Cost |
|
Total Unrealized Gains
|
|
Total Unrealized Losses
|
|
Total Fair
Value |
||||||||
Nuclear decommissioning trusts
|
|
|
|
|
|
|
|
||||||||
Short-term investments
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18
|
|
Global equity securities
|
481
|
|
|
1,422
|
|
|
(3
|
)
|
|
1,900
|
|
||||
Fixed-income securities
|
1,432
|
|
|
58
|
|
|
(8
|
)
|
|
1,482
|
|
||||
Total
(1)
|
$
|
1,931
|
|
|
$
|
1,480
|
|
|
$
|
(11
|
)
|
|
$
|
3,400
|
|
As of December 31, 2018
|
|
|
|
|
|
|
|
||||||||
Nuclear decommissioning trusts
|
|
|
|
|
|
|
|
||||||||
Short-term investments
|
$
|
29
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
29
|
|
Global equity securities
|
568
|
|
|
1,246
|
|
|
(5
|
)
|
|
1,809
|
|
||||
Fixed-income securities
|
1,288
|
|
|
30
|
|
|
(18
|
)
|
|
1,300
|
|
||||
Total
(1)
|
$
|
1,885
|
|
|
$
|
1,276
|
|
|
$
|
(23
|
)
|
|
$
|
3,138
|
|
|
|
|
|
|
|
|
|
|
As of
|
||
(in millions)
|
March 31, 2019
|
||
Less than 1 year
|
$
|
31
|
|
1–5 years
|
534
|
|
|
5–10 years
|
337
|
|
|
More than 10 years
|
580
|
|
|
Total maturities of fixed-income securities
|
$
|
1,482
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Proceeds from sales and maturities of nuclear decommissioning trust investments
|
$
|
346
|
|
|
$
|
494
|
|
Gross realized gains on securities
|
(34
|
)
|
|
37
|
|
||
Gross realized losses on securities
|
19
|
|
|
(4
|
)
|
|
Balance at
|
||||||
(in millions)
|
March 31, 2019
|
|
December 31, 2018
|
||||
2015 Butte fire
|
$
|
212
|
|
|
$
|
226
|
|
2017 Northern California wildfires
|
3,500
|
|
|
3,500
|
|
||
2018 Camp fire
|
10,500
|
|
|
10,500
|
|
||
Total wildfire-related claims
(1)
|
$
|
14,212
|
|
|
$
|
14,226
|
|
|
|
|
|
•
|
On the Cal Fire website, Cal Fire has identified coordinates for the 2018 Camp fire near Tower :27/222 on the Utility’s Caribou-Palermo 115 kV Transmission Line and has identified the start time of the 2018 Camp fire as 6:33 a.m. on November 8, 2018.
|
•
|
On November 8, 2018, at approximately 6:15 a.m., the Utility’s Caribou-Palermo 115kV Transmission Line relayed and deenergized. At approximately 6:30 a.m. that day, a Utility employee observed fire in the vicinity of Tower :27/222, and this observation was reported to 911 by Utility employees. That afternoon, the Utility observed damage on the line at Tower :27/222. Specifically, an aerial patrol identified that a suspension insulator supporting a transposition jumper had separated from an arm on Tower :27/222.
|
•
|
On November 14, 2018, the Utility observed a broken C-hook attached to the separated suspension insulator that had connected the suspension insulator to a tower arm, along with wear at the connection point. In addition, the Utility observed a flash mark on Tower :27/222 near where the transposition jumper was suspended and damage to the transposition jumper and suspension insulator.
|
•
|
In addition to the events on the Caribou-Palermo 115kV Transmission Line, on November 8, 2018, at approximately 6:45 a.m., the Utility’s Big Bend 1101 12 kV Circuit experienced an outage. On November 9, 2018, a Utility employee on patrol arrived at the location of the pole with Line Recloser (“LR”) 1704 on the Big Bend 1101 Circuit and observed that the pole and other equipment were on the ground with bullets and bullet holes at the break point of the pole and on the equipment. On November 12, 2018, a Utility employee was patrolling Concow Road north of LR 1704 when he observed wires down and damaged and downed poles at the intersection of Concow Road and Rim Road. At this location, the employee observed several snapped trees, with some on top of the downed wires.
|
•
|
the La Porte, McCourtney, Lobo and Honey fires “were caused by trees coming into contact with power lines”, and
|
•
|
the Redwood, Sulphur, Cherokee, 37, Blue, Norrbom, Adobe, Partrick, Pythian, Nuns, Pocket and Atlas fires “were caused by electric power and distribution lines, conductors and the failure of power poles.”
|
(in millions)
|
Insurance Receivable
|
||
2018 Camp fire
|
|
||
Balance at December 31, 2018
|
$
|
1,380
|
|
Accrued insurance recoveries
|
$
|
—
|
|
Reimbursements
|
—
|
|
|
Balance at March 31, 2019
|
$
|
1,380
|
|
|
|
||
2017 Northern California wildfires
|
|
||
Balance at December 31, 2018
|
$
|
829
|
|
Accrued insurance recoveries
|
—
|
|
|
Reimbursements
|
—
|
|
|
Balance at March 31, 2019
|
$
|
829
|
|
Loss Accrual (in millions)
|
|
||
Balance at December 31, 2015
|
$
|
—
|
|
Accrued losses
|
750
|
||
Payments
(1)
|
(60)
|
||
Balance at December 31, 2016
|
690
|
||
Accrued losses
|
350
|
||
Payments
(1)
|
(479)
|
||
Balance at December 31, 2017
|
561
|
||
Accrued losses
|
—
|
|
|
Payments
(1)
|
(335
|
)
|
|
Balance at December 31, 2018
|
226
|
|
|
Accrued losses
|
—
|
|
|
Payments
(1)
|
(14
|
)
|
|
Balance as of March 31, 2019
|
$
|
212
|
|
|
|
•
|
prior to June 21, 2019, “re-inspect all of its electrical grid and remove or trim all trees that could fall onto its power lines, poles or equipment in high-wind conditions, . . . identify and fix all conductors that might swing together and arc due to slack and/or other circumstances under high-wind conditions[,] identify and fix damaged or weakened poles, transformers, fuses and other connectors [and] identify and fix any other condition anywhere in its grid similar to any condition that contributed to any previous wildfires,”
|
•
|
“document the foregoing inspections and the work done and . . . rate each segment’s safety under various wind conditions” and
|
•
|
at all times from and after June 21, 2019, “supply electricity only through those parts of its electrical grid it has determined to be safe under the wind conditions then prevailing.”
|
•
|
“fully comply with all applicable laws concerning vegetation management and clearance requirements;”
|
•
|
“fully comply with the specific targets and metrics set forth in its wildfire mitigation plan, including with respect to enhanced vegetation management;”
|
•
|
submit to “regular, unannounced inspections” by the Monitor “of PG&E’s vegetation management efforts and equipment inspection, enhancement, and repair efforts” in connection with a requirement that the Monitor “assess PG&E’s wildfire mitigation and wildfire safety work;”
|
•
|
“maintain traceable, verifiable, accurate, and complete records of its vegetation management efforts” and report to the Monitor monthly on its vegetation management status and progress; and
|
•
|
“ensure that sufficient resources, financial and personnel, including contractors and employees, are allocated to achieve the foregoing” and to forgo issuing “any dividends until [the Utility] is in compliance with all applicable vegetation management requirements as set forth above.”
|
|
Balance at
|
||||||
|
March 31,
|
|
December 31,
|
||||
(in millions)
|
2019
|
|
2018
|
||||
Topock natural gas compressor station
|
$
|
358
|
|
|
$
|
369
|
|
Hinkley natural gas compressor station
|
145
|
|
|
146
|
|
||
Former manufactured gas plant sites owned by the Utility or third parties
(1)
|
525
|
|
|
520
|
|
||
Utility-owned generation facilities (other than fossil fuel-fired),
other facilities, and third-party disposal sites (2) |
107
|
|
|
111
|
|
||
Fossil fuel-fired generation facilities and sites
(3)
|
131
|
|
|
137
|
|
||
Total environmental remediation liability
|
$
|
1,266
|
|
|
$
|
1,283
|
|
|
|
|
|
•
|
The Outcome of the Chapter 11 Cases.
For the duration of the Chapter 11 Cases, PG&E Corporation’s and the Utility’s business is subject to the risks and uncertainties of bankruptcy. For example, the Chapter 11 Cases could adversely affect the Utility’s relationships with suppliers and employees which, in turn, could adversely affect the value of the business and assets of PG&E Corporation and the Utility. PG&E Corporation and the Utility also expect to incur increased legal and other professional costs associated with the Chapter 11 Cases and the reorganization. At this time, it is not possible to predict with certainty the effect of the Chapter 11 Cases on their business or various creditors, or whether or when PG&E Corporation and the Utility will emerge from bankruptcy. PG&E Corporation’s and the Utility’s future financial condition, results of operations, liquidity and cash flows depend upon confirming, and successfully implementing, on a timely basis, a plan of reorganization.
|
•
|
The Utility’s Ability to Fund Ongoing Operations and Other Capital Needs.
In connection with the Chapter 11 Cases, PG&E Corporation and the Utility entered into the DIP Credit Agreement, which was approved on a final basis on March 27, 2019. For the duration of the Chapter 11 Cases, PG&E Corporation and the Utility expect that the DIP Credit Agreement, together with cash on hand, cash flow from operations and distributions received from subsidiaries, will be the Utility’s primary source of capital to fund ongoing operations and other capital needs and that they will have limited, if any, access to additional financing. In the event that cash on hand, cash flow from operations, distributions received from subsidiaries, and availability under the DIP Credit Agreement are not sufficient to meet these liquidity needs, PG&E Corporation and the Utility may be required to seek additional financing, and can provide no assurance that additional financing would be available or, if available, offered on acceptable terms. The amount of any such additional financing could be limited by negative covenants in the DIP Credit Agreement, which include restrictions on PG&E Corporation’s and the Utility’s ability to, among other things, incur additional indebtedness and create liens on assets.
|
•
|
The Impact of Wildfires.
PG&E Corporation and the Utility face several uncertainties in connection with the 2018 Camp fire and 2017 Northern California wildfires, related to:
|
◦
|
the amount of possible loss related to third-party claims (as of March 31, 2019, the Utility recorded total charges of $14 billion, which reflects the low end of the range of reasonably estimated losses and is subject to change based on additional information), which aggregate possible losses, if the Utility were found liable for certain or all of the costs, expenses and other losses in connection with the 2018 Camp fire and 2017 Northern California wildfires (other than potential punitive damages, fines and penalties or damages related to future claims), could exceed $30 billion; and punitive damages, which could be material;
|
◦
|
the impact of investigations, including criminal and SEC investigations;
|
◦
|
fines or penalties, which could be material, if the CPUC or any law enforcement agency were to bring an enforcement action, including a criminal proceeding, and determined that the Utility had failed to comply with applicable laws and regulations;
|
◦
|
the amount of damages in respect of future claims, which could be material;
|
◦
|
the applicability of the doctrine of inverse condemnation in the 2018 Camp fire and 2017 Northern California wildfires litigation, which the Utility intends to continue to challenge during the pendency of its Chapter 11 Case; the applicability of other theories of liability, including negligence, related to the 2018 Camp fire and 2017 Northern California wildfire claims;
|
◦
|
the recoverability of the above mentioned costs, even if a court decision imposes liability under the doctrine of inverse condemnation;
|
◦
|
the amount of the Customer Harm Threshold under SB 901 and the timing of any recovery by the Utility in excess of the Customer Harm Threshold in a proceeding before the CPUC;
|
◦
|
the impact of the Strike Force Report;
|
◦
|
the amount and recoverability of enhanced and accelerated inspection costs of the Utility’s electric transmission and distribution assets (the Utility incurred costs of
$210 million
for enhanced and accelerated inspection and repair costs for the three months ended March 31, 2019); and
|
◦
|
the amount and recoverability of clean-up and repair costs (the Utility incurred costs of
$889 million
for clean-up and repair of the Utility’s facilities through March 31, 2019).
|
•
|
The Outcome of Other Enforcement, Litigation, and Regulatory Matters
. The Utility’s financial results may continue to be impacted by the outcome of other current and future enforcement, litigation (to the extent not stayed as a result of the Chapter 11 Cases), and regulatory matters, including the outcome of the Locate and Mark OII, phase two of the Safety Culture OII, the outcome of phase two of the ex parte OII, the sentencing terms of the Utility’s January 27, 2017 federal criminal conviction, including the oversight of the Utility’s probation and the potential recommendations by the Monitor, and potential penalties in connection with the Utility’s safety and other self-reports. (See Note 11 of the Notes to the Condensed Consolidated Financial Statements in Item 1.)
|
•
|
The Timing and Outcome of Ratemaking Proceedings
. The Utility’s financial results may be impacted by the timing and outcome of its 2019 GT&S rate case, 2020 GRC, FERC TO18, TO19, and TO20 rate cases, 2020 cost of capital proceeding, and its ability to timely recover costs not currently in rates, including costs already incurred and future costs tracked in its CEMA, WEMA, FHPMA, and Fire Risk Mitigation Memorandum Account (FRMMA) that are incurred in connection with the Utility's 2019 Wildfire Safety Plan, the amount of which is substantial and is expected to increase. The outcome of regulatory proceedings can be affected by many factors, including intervening parties’ testimonies, potential rate impacts, the Utility’s reputation, the regulatory and political environments, and other factors. (See Notes 4 and 11 of the Notes to the Condensed Consolidated Financial Statements in Item 1 and “Regulatory Matters” below.)
|
•
|
The Utility’s Compliance with the CPUC Capital Structure
. The CPUC’s capital structure decisions require the Utility to maintain a 52% equity ratio on average over the period that the authorized capital structure is in place, and to file an application for a waiver to the capital structure condition if an adverse financial event reduces its equity ratio by 1% or more. Due to the net charges recorded in connection with the 2018 Camp fire and the 2017 Northern California wildfires as of December 31, 2018, the Utility submitted to the CPUC an application for a waiver of the capital structure condition on February 28, 2019. The waiver is subject to CPUC approval. The CPUC’s decisions state that the Utility shall not be considered in violation of these conditions during the period the waiver application is pending resolution. The Utility is unable to predict the timing and outcome of its waiver application. (See “Regulatory Matters” below.)
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Consolidated Total
|
$
|
136
|
|
|
$
|
442
|
|
PG&E Corporation
|
3
|
|
|
(7
|
)
|
||
Utility
|
$
|
133
|
|
|
$
|
449
|
|
|
Three Months Ended
March 31, 2019 |
|
Three Months Ended
March 31, 2018 |
||||||||||||||||||||
|
Revenues/Costs:
|
|
Revenues/Costs:
|
||||||||||||||||||||
(in millions)
|
That Impacted Earnings
|
|
That Did Not Impact Earnings
|
|
Total Utility
|
|
That Impacted Earnings
|
|
That Did Not Impact Earnings
|
|
Total Utility
|
||||||||||||
Electric operating revenues
|
$
|
1,913
|
|
|
$
|
879
|
|
|
$
|
2,792
|
|
|
$
|
1,937
|
|
|
$
|
1,014
|
|
|
$
|
2,951
|
|
Natural gas operating revenues
|
794
|
|
|
425
|
|
|
1,219
|
|
|
738
|
|
|
367
|
|
|
1,105
|
|
||||||
Total operating revenues
|
2,707
|
|
|
1,304
|
|
|
4,011
|
|
|
2,675
|
|
|
1,381
|
|
|
4,056
|
|
||||||
Cost of electricity
|
—
|
|
|
599
|
|
|
599
|
|
|
—
|
|
|
819
|
|
|
819
|
|
||||||
Cost of natural gas
|
—
|
|
|
339
|
|
|
339
|
|
|
—
|
|
|
289
|
|
|
289
|
|
||||||
Operating and maintenance
|
1,694
|
|
|
410
|
|
|
2,104
|
|
|
1,251
|
|
|
353
|
|
|
1,604
|
|
||||||
Wildfire-related claims, net of insurance recoveries
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
(7
|
)
|
||||||
Depreciation, amortization, and decommissioning
|
797
|
|
|
—
|
|
|
797
|
|
|
752
|
|
|
—
|
|
|
752
|
|
||||||
Total operating expenses
|
2,491
|
|
|
1,348
|
|
|
3,839
|
|
|
1,996
|
|
|
1,461
|
|
|
3,457
|
|
||||||
Operating income (loss)
|
216
|
|
|
(44
|
)
|
|
172
|
|
|
679
|
|
|
(80
|
)
|
|
599
|
|
||||||
Interest income
|
21
|
|
|
—
|
|
|
21
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||
Interest expense
|
(101
|
)
|
|
—
|
|
|
(101
|
)
|
|
(217
|
)
|
|
—
|
|
|
(217
|
)
|
||||||
Other income, net
|
22
|
|
|
44
|
|
|
66
|
|
|
29
|
|
|
80
|
|
|
109
|
|
||||||
Reorganization items
|
(111
|
)
|
|
—
|
|
|
(111
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Income before income taxes
|
$
|
47
|
|
|
$
|
—
|
|
|
$
|
47
|
|
|
$
|
500
|
|
|
$
|
—
|
|
|
$
|
500
|
|
Income tax provision
(1)
|
|
|
|
|
(86
|
)
|
|
|
|
|
|
48
|
|
||||||||||
Net income
|
|
|
|
|
133
|
|
|
|
|
|
|
452
|
|
||||||||||
Preferred stock dividend requirement
(1)
|
|
|
|
|
—
|
|
|
|
|
|
|
3
|
|
||||||||||
Income Available for Common Stock
|
|
|
|
|
$
|
133
|
|
|
|
|
|
|
$
|
449
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||
|
2019
|
|
2018
|
||
Federal statutory income tax rate
|
21.0
|
%
|
|
21.0
|
%
|
Increase (decrease) in income tax rate resulting from:
|
|
|
|
||
State income tax (net of federal benefit)
(1)
|
(17.7
|
)%
|
|
2.3
|
%
|
Effect of regulatory treatment of fixed asset differences
(2)
|
(179.2
|
)%
|
|
(16.5
|
)%
|
Tax credits
|
(5.8
|
)%
|
|
(0.6
|
)%
|
Other, net
|
(0.6
|
)%
|
|
3.4
|
%
|
Effective tax rate
|
(182.3
|
)%
|
|
9.6
|
%
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cost of purchased power, net
(1)
|
$
|
499
|
|
|
$
|
753
|
|
Fuel used in generation facilities
|
100
|
|
|
66
|
|
||
Total cost of electricity
|
$
|
599
|
|
|
$
|
819
|
|
Average cost of purchased power per kWh
(2)
|
$
|
0.346
|
|
|
$
|
0.123
|
|
Total purchased power, net (in millions of kWh)
|
1,443
|
|
|
6,110
|
|
||
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Cost of natural gas sold
|
$
|
309
|
|
|
$
|
257
|
|
Transportation cost of natural gas sold
|
30
|
|
|
32
|
|
||
Total cost of natural gas
|
$
|
339
|
|
|
$
|
289
|
|
Average cost per Mcf
(1)
of natural gas sold
|
$
|
3.29
|
|
|
$
|
3.03
|
|
Total natural gas sold (in millions of Mcf)
|
94
|
|
|
85
|
|
||
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(in millions)
|
2019
|
|
2018
|
||||
Net cash provided by operating activities
|
$
|
2,274
|
|
|
$
|
1,516
|
|
Net cash used in investing activities
|
(1,247
|
)
|
|
(1,475
|
)
|
||
Net cash provided by (used in) financing activities
|
231
|
|
|
(366
|
)
|
||
Net change in cash, cash equivalents and restricted cash
|
$
|
1,258
|
|
|
$
|
(325
|
)
|
•
|
the timing and amounts of costs, including fines and penalties, that may be incurred in connection with current and future enforcement, litigation, and regulatory matters (see “Enforcement Matters” in Note 11 of the Notes to the Condensed Consolidated Financial Statements in Item 1 and Part II, Item 1. Legal Proceedings for more information);
|
•
|
the timing and amount of premium payments related to wildfire insurance (see “Wildfire Insurance” in Note 11 of the Notes to the Condensed Consolidated Financial Statements in Item 1 for more information);
|
•
|
the Tax Act, which may accelerate the timing of federal tax payments and reduce revenue requirements, resulting in lower operating cash flows depending on the timing of wildfire payments;
|
•
|
the timing and outcomes of the 2019 GT&S rate case, 2020 GRC, FERC TO18, TO19 and TO20 rate cases, 2018 CEMA filing, 2020 Cost of Capital, NDCTP, and other ratemaking and regulatory proceedings; and
|
•
|
the timing and amount of substantially increasing costs in connection with the 2019 Wildfire Safety Plan (see “Regulatory Matters” below for more information).
|
|
2019 Currently Authorized
|
|
2020 Requested
|
||||||||||||||
|
Cost
|
|
Capital Structure
|
|
Weighted Cost
|
|
Cost
|
|
Capital Structure
|
|
Weighted Cost
|
||||||
Return on common equity
|
10.25
|
%
|
|
52.00
|
%
|
|
5.33
|
%
|
|
16.00
|
%
|
|
52.00
|
%
|
|
8.32
|
%
|
Preferred stock
|
5.60
|
%
|
|
1.00
|
%
|
|
0.06
|
%
|
|
5.52
|
%
|
|
0.50
|
%
|
|
0.03
|
%
|
Long-term debt
|
4.89
|
%
|
|
47.00
|
%
|
|
2.30
|
%
|
|
5.16
|
%
|
|
47.50
|
%
|
|
2.45
|
%
|
Weighted average cost of capital
|
|
|
|
|
7.69
|
%
|
|
|
|
|
|
10.80
|
%
|
Revenue Requirement
(in millions)
|
Authorized in 2017 GRC and 2015 GT&S
|
|
Requested in 2020 Cost of Capital Application
|
||||
Electric generation and distribution
|
$
|
6,266
|
|
|
$
|
7,110
|
|
Gas distribution
|
1,739
|
|
|
1,968
|
|
||
Gas transmission and storage
|
$
|
1,269
|
|
|
$
|
1,428
|
|
Line of Business:
(in millions) |
Amounts Requested in the GRC Application
|
|
Amounts Currently Authorized for 2019
(1)
|
|
Increase (Decrease) to 2019 Authorized Amounts
|
||||||
Electric distribution
|
$
|
5,113
|
|
|
$
|
4,364
|
|
|
$
|
749
|
|
Gas distribution
|
2,097
|
|
|
1,963
|
|
|
134
|
|
|||
Electric generation
|
2,366
|
|
|
2,191
|
|
|
175
|
|
|||
Total revenue requirements
|
$
|
9,576
|
|
|
$
|
8,518
|
|
|
$
|
1,058
|
|
|
|
|
|
|
|
Cost Category:
(in millions) |
Amounts Requested in the GRC Application
|
|
Amounts Currently Authorized for 2019
(1)
|
|
Increase (Decrease) to 2019 Authorized Amounts
|
||||||
Operations and maintenance
|
$
|
2,156
|
|
|
$
|
1,946
|
|
|
$
|
210
|
|
Customer services
|
319
|
|
|
338
|
|
|
(19
|
)
|
|||
Administrative and general
|
1,315
|
|
|
953
|
|
|
361
|
|
|||
Less: Revenue credits
|
(196
|
)
|
|
(152
|
)
|
|
(44
|
)
|
|||
Franchise fees, taxes other than income, and other adjustments
|
236
|
|
|
181
|
|
|
55
|
|
|||
Depreciation, return, and income taxes
|
5,747
|
|
|
5,252
|
|
|
495
|
|
|||
Total revenue requirements
|
$
|
9,576
|
|
|
$
|
8,518
|
|
|
$
|
1,058
|
|
|
|
|
|
|
|
Revenue requirement drivers
|
Increase to 2019 Authorized Amounts
|
|
Community Wildfire Safety Program
|
6.8
|
%
|
Liability insurance
(1)
|
3.2
|
%
|
Core gas and electric operations
|
2.4
|
%
|
Total proposed revenue requirement increase
|
12.4
|
%
|
|
|
•
|
a two-way electric and gas Risk Transfer Balancing Account to record the difference between the amounts adopted for liability insurance premiums and the Utility’s actual costs; this two-way account would allow the Utility to pass-through actual insurance costs for up to $2 billion in coverage and return to customers any overcollection if forecast costs exceed actuals costs; and
|
•
|
a two-way Wildfire Safety Balancing Account to track and record actual incremental expenses and capital revenue requirements associated with the incremental costs of fire risk mitigation work that are not already addressed and recorded in another account; this would include the costs associated with overhead system hardening, enhanced vegetation management, and other incremental costs of wildfire mitigations that are approved by the CPUC in the Utility’s annual wildfire mitigation plan. In accordance with SB 901, the Utility submitted its first Wildfire Safety Plan to the CPUC on February 6, 2019.
|
•
|
Installing nearly 600 new, high-definition cameras, made available to Cal Fire and local fire officials, in high fire-threat areas by 2022, increasing coverage across high fire-threat areas to more than 90%;
|
•
|
Adding approximately 1,300 additional new weather stations by 2022, at a density of one station roughly every 20 circuit miles in high fire-threat areas;
|
•
|
Conducting enhanced safety inspections of electric infrastructure in high-fire threat areas, including approximately 735,000 electric towers and poles across approximately 5,700 transmission line miles and 25,200 distribution line miles;
|
•
|
Further enhancing vegetation management efforts across high and extreme fire-threat areas to address vegetation that poses higher potential for wildfire risk, such as removing or trimming trees from particular “at-risk” tree species that have exhibited a higher pattern of failing;
|
•
|
Continuing to disable automatic reclosing in high fire-threat areas during wildfire season and periods of high fire-risk and upgrading reclosers and circuit breakers in high fire-threat areas with remote control capabilities;
|
•
|
Expanding the Public Safety Power Shutoff Program (PSPS) to include all transmission and distribution lines in Tier 2 and Tier 3 High Fire Threat District (HFTD) areas;
|
•
|
Installing stronger and more resilient poles and covered power lines, including targeted undergrounding, starting in areas with the highest fire risk, ultimately upgrading and strengthening approximately 7,100 miles over the next 10 years; and
|
•
|
Partnering with additional communities in high fire-threat areas to create new resilience zones that can power central community resources during a Public Safety Power Shutoff.
|
•
|
how to define climate change adaption for the IOUs;
|
•
|
the climate-driven risks facing the IOUs;
|
•
|
data, tools, resources, and guidance to instruct utilities on how to incorporate adaption in their existing planning and operational processes; and
|
•
|
strategies to address climate change in CPUC proceedings, including impacts on disadvantaged communities.
|
•
|
adopting benchmark values used to set the PCIA rate that more closely resemble actual market prices for resource adequacy and renewable energy credits;
|
•
|
continuing to allow legacy utility-owned generation costs to be recovered from CCA customers;
|
•
|
eliminating the 10-year limit on PCIA cost recovery for post-2002 utility owned generation and certain storage costs; and
|
•
|
adding an annual true-up to the PCIA rate based on market sales.
|
•
|
“A liquidity-only fund
that would provide liquidity for utilities to pay wildfire damage claims pending CPUC determination of cost recovery potentially coupled with modification of cost recovery standards.
|
•
|
“Adopting a fault-based standard
that would modify California’s strict liability standard to one based on fault to balance the need for public improvements with private harm to individuals.
|
•
|
“Creation of a catastrophic wildfire fund
coupled with a revised cost recovery standard to spread the cost of catastrophic wildfires more broadly among stakeholders.”
|
•
|
the risks and uncertainties associated with the Chapter 11 Cases, including, but not limited to, the ability to develop, consummate, and implement a plan of reorganization with respect to PG&E Corporation and the Utility; the ability to develop and obtain applicable Bankruptcy Court, creditor or regulatory approvals; the effect of any alternative proposals, views or objections related to the plan of reorganization; potential complexities that may arise in connection with concurrent proceedings involving the Bankruptcy Court, the U.S. District Court, the CPUC, and the FERC; increased costs related to the Chapter 11 Cases; the ability to obtain sufficient financing sources for ongoing and future operations; disruptions to PG&E Corporation’s and the Utility’s business and operations and the potential impact on regulatory compliance;
|
•
|
restrictions on PG&E Corporation’s and the Utility’s ability to pursue strategic and operational initiatives for the duration of the Chapter 11 Cases;
|
•
|
increased employee attrition as a result of the filing of the Chapter 11 Cases;
|
•
|
PG&E Corporation’s and the Utility’s historical financial information not being indicative of future financial performance as a result of the Chapter 11 Cases;
|
•
|
the potential delay in emergence from bankruptcy if PG&E Corporation and the Utility are not able to develop and consummate a consensual plan of reorganization and are forced to engage in a contested proceeding;
|
•
|
the possibility that the DIP Credit Agreement is not sufficient to fund PG&E Corporation’s and the Utility’s cash requirements through their emergence from bankruptcy;
|
•
|
the possibility that PG&E Corporation and the Utility may not be able to obtain exit financing on favorable terms or at all;
|
•
|
the outcome of the U.S. District Court matters and probation;
|
•
|
the impact of the 2018 Camp fire and the 2017 Northern California wildfires, including whether the Utility will be able to timely recover costs incurred in connection with the wildfires in excess of the Utility’s currently authorized revenue requirements; the timing and outcome of the remaining wildfire investigations and the extent to which the Utility will have liability associated with these fires; the timing and amount of insurance recoveries; and potential liabilities in connection with fines or penalties that could be imposed on the Utility if the CPUC or any other law enforcement agency were to bring an enforcement action and determined that the Utility failed to comply with applicable laws and regulations;
|
•
|
the timing and outcome of claims arising from the 2015 Butte fire, including claims by the OES; the timing and outcome of any proceeding to recover related costs in excess of insurance through rates; and whether any regulatory enforcement proceedings in connection with the 2015 Butte fire will be opened and any additional fines or penalties imposed on the Utility;
|
•
|
the timing and outcome of issuance of recovery bonds (“securitization”) of 2017 Northern California wildfires costs that the CPUC finds just and reasonable;
|
•
|
the timing and outcome of any policy actions resulting from Governor Newsom’s Strike Force Report;
|
•
|
whether PG&E Corporation and the Utility are able to successfully challenge the application of the doctrine of inverse condemnation to the 2018 Camp fire, the 2017 Northern California wildfires and the 2015 Butte fire;
|
•
|
the timing and outcome of future regulatory and legislative developments in connection with SB 901, including the Customer Harm Threshold in connection with the 2017 Northern California wildfires, future wildfire reforms, inverse condemnation reform, a potential state wildfire insurance fund, and other wildfire mitigation measures or other reforms targeted at the Utility;
|
•
|
the outcome of the Utility’s CWSP that the Utility has developed in coordination with first responders, civic and community leaders, and customers, to help reduce wildfire threats and improve safety as a result of climate-driven wildfires and extreme weather, including the Utility’s ability to comply with the targets and metrics set forth in the 2019 Wildfire Safety Plan; and the cost of the program, and the timing and outcome of any proceeding to recover such cost through rates;
|
•
|
whether the Utility will be able to obtain full recovery of its significantly increased insurance premiums, and the timing of any such recovery;
|
•
|
whether the Utility can obtain wildfire insurance at a reasonable cost in the future, or at all, and whether insurance coverage is adequate for future losses or claims;
|
•
|
the timing and outcomes of the 2019 GT&S rate case, 2020 GRC, FERC TO18, TO19, and TO20 rate cases, 2018 CEMA, future applications for WEMA, FHPMA and FRMMA, future cost of capital proceeding, and other ratemaking and regulatory proceedings;
|
•
|
the outcome of the probation and the monitorship imposed by the federal court after the Utility’s conviction in the federal criminal trial in 2017, the timing and outcomes of the debarment proceeding, potential reliability penalties or sanctions from the North American Electric Reliability Corporation, the SED’s unresolved enforcement matters relating to the Utility’s compliance with natural gas-related laws and regulations, and other investigations that have been or may be commenced relating to the Utility’s compliance with natural gas- and electric- related laws and regulations, ex parte communications, and the ultimate amount of fines, penalties, and remedial costs that the Utility may incur in connection with the outcomes;
|
•
|
the effects on PG&E Corporation’s and the Utility’s reputations caused by the CPUC’s investigations of natural gas and electric incidents, the 2018 Camp fire and 2017 Northern California wildfires, locate and mark, improper communications between the CPUC and the Utility, and the Utility’s ongoing work to remove encroachments from transmission pipeline rights-of-way;
|
•
|
the implementation of the Safety Culture OII decision approved on November 29, 2018, and the outcome of its phase two proceeding, and future legislative or regulatory actions that may be taken, such as requiring the Utility to separate its electric and natural gas businesses, or restructure into separate entities, or undertake some other corporate restructuring, or implement corporate governance changes;
|
•
|
whether the Utility can control its costs within the authorized levels of spending, and timely recover its costs through rates; whether the Utility can continue implementing a streamlined organizational structure and achieve project savings, the extent to which the Utility incurs unrecoverable costs that are higher than the forecasts of such costs; and changes in cost forecasts or the scope and timing of planned work resulting from changes in customer demand for electricity and natural gas or other reasons;
|
•
|
whether the Utility and its third-party vendors and contractors are able to protect the Utility’s operational networks and information technology systems from cyber- and physical attacks, or other internal or external hazards;
|
•
|
the timing and outcome of the October 1, 2018 request for rehearing of FERC’s denial of the complaint filed by the CPUC and certain other parties that the Utility provide an open and transparent planning process for its capital transmission projects that do not go through the CAISO’s Transmission Planning Process to allow for greater participation and input from interested parties; and the timing and ultimate outcome of the Ninth Circuit Court of Appeals decision on January 8, 2018, to reverse FERC’s decision granting the Utility a 50 basis point ROE incentive adder for continued participation in the CAISO and remanding the case to FERC for further proceedings;
|
•
|
the outcome of current and future self-reports, investigations, or other enforcement proceedings that could be commenced or notices of violation that could be issued relating to the Utility’s compliance with laws, rules, regulations, or orders applicable to its operations, including the construction, expansion, or replacement of its electric and gas facilities, electric grid reliability, inspection and maintenance practices, customer billing and privacy, physical and cybersecurity, environmental laws and regulations; and the outcome of existing and future SED notices of violations;
|
•
|
the timing and outcome of any CPUC action in connection with the Utility’s SmartMeter™ Upgrade cost-benefit analysis;
|
•
|
the impact of environmental remediation laws, regulations, and orders; the ultimate amount of costs incurred to discharge the Utility’s known and unknown remediation obligations; and the extent to which the Utility is able to recover environmental costs in rates or from other sources;
|
•
|
the impact of SB 100, which was signed into law on September 10, 2018, that increases the percentage from 50% to 60% of California’s electricity portfolio that must come from renewables by 2030; and establishes state policy that 100% of all retail electricity sales must come from renewable portfolio standard-eligible or carbon-free resources by 2045;
|
•
|
how the CPUC and the California Air Resources Board implement state environmental laws relating to GHG, renewable energy targets, energy efficiency standards, DERs, EVs, and similar matters, including whether the Utility is able to continue recovering associated compliance costs, such as the cost of emission allowances and offsets under cap-and-trade regulations; and whether the Utility is able to timely recover its associated investment costs;
|
•
|
the impact of the California governor’s executive order issued on January 26, 2018, to implement a new target of five million zero-emission vehicles on the road in California by 2030;
|
•
|
the ultimate amount of unrecoverable environmental costs the Utility incurs associated with the Utility’s natural gas compressor station site located near Hinkley, California and the Utility’s fossil fuel-fired generation sites;
|
•
|
the impact of new legislation or NRC regulations, recommendations, policies, decisions, or orders relating to the nuclear industry, including operations, seismic design, security, safety, relicensing, the storage of spent nuclear fuel, decommissioning, cooling water intake, or other issues; the impact of potential actions, such as legislation, taken by state agencies that may affect the Utility’s ability to continue operating Diablo Canyon until its planned retirement;
|
•
|
the impact of wildfires, droughts, floods, or other weather-related conditions or events, climate change, natural disasters, acts of terrorism, war, vandalism (including cyber-attacks), downed power lines, and other events, that can cause unplanned outages, reduce generating output, disrupt the Utility’s service to customers, or damage or disrupt the facilities, operations, or information technology and systems owned by the Utility, its customers, or third parties on which the Utility relies, and the reparation and other costs that the Utility may incur in connection with such conditions or events; the impact of the adequacy of the Utility’s emergency preparedness; whether the Utility incurs liability to third parties for property damage or personal injury caused by such events; whether the Utility is subject to civil, criminal, or regulatory penalties in connection with such events; and whether the Utility’s insurance coverage is available for these types of claims and sufficient to cover the Utility’s liability;
|
•
|
whether the Utility’s climate change adaptation strategies are successful;
|
•
|
the breakdown or failure of equipment that can cause damages, including fires, and unplanned outages; and whether the Utility will be subject to investigations, penalties, and other costs in connection with such events;
|
•
|
the impact that reductions in customer demand for electricity and natural gas have on the Utility’s ability to make and recover its investments through rates and earn its authorized return on equity, and whether the Utility is successful in addressing the impact of growing distributed and renewable generation resources, changing customer demand for natural gas and electric services;
|
•
|
the supply and price of electricity, natural gas, and nuclear fuel; the extent to which the Utility can manage and respond to the volatility of energy commodity prices; the ability of the Utility and its counterparties to post or return collateral in connection with price risk management activities; and whether the Utility is able to recover timely its electric generation and energy commodity costs through rates, including its renewable energy procurement costs;
|
•
|
the amount and timing of charges reflecting probable liabilities for third-party claims; the extent to which costs incurred in connection with third-party claims or litigation can be recovered through insurance, rates, or from other third parties; and whether the Utility can continue to obtain adequate insurance coverage for future losses or claims, especially following a major event that causes widespread third-party losses;
|
•
|
the ability of PG&E Corporation and the Utility to access capital markets and other sources of debt and equity financing in a timely manner and on acceptable terms;
|
•
|
the impact of the regulation of utilities and their holding companies, including how the CPUC interprets and enforces the financial and other conditions imposed on PG&E Corporation when it became the Utility’s holding company, and whether the uncertainty in connection with the 2018 Camp fire and the 2017 Northern California wildfires, the ultimate outcomes of the CPUC’s pending investigations, and other enforcement matters will impact the Utility’s ability to make distributions to PG&E Corporation;
|
•
|
the outcome of federal or state tax audits and the impact of any changes in federal or state tax laws, policies, regulations, or their interpretation;
|
•
|
changes in the regulatory and economic environment, including potential changes affecting renewable energy sources and associated tax credits, as a result of the current federal administration; and
|
•
|
the impact of changes in GAAP, standards, rules, or policies, including those related to regulatory accounting, and the impact of changes in their interpretation or application.
|
•
|
prior to June 21, 2019, “re-inspect all of its electrical grid and remove or trim all trees that could fall onto its power lines, poles or equipment in high-wind conditions, . . . identify and fix all conductors that might swing together and arc due to slack and/or other circumstances under high-wind conditions[,] identify and fix damaged or weakened poles, transformers, fuses and other connectors [and] identify and fix any other condition anywhere in its grid similar to any condition that contributed to any previous wildfires;”
|
•
|
“document the foregoing inspections and the work done and . . . rate each segment’s safety under various wind conditions;” and
|
•
|
at all times from and after June 21, 2019, “supply electricity only through those parts of its electrical grid it has determined to be safe under the wind conditions then prevailing.”
|
•
|
“fully comply with all applicable laws concerning vegetation management and clearance requirements;”
|
•
|
“fully comply with the specific targets and metrics set forth in its wildfire mitigation plan, including with respect to enhanced vegetation management;”
|
•
|
submit to “regular, unannounced inspections” by the Monitor “of PG&E’s vegetation management efforts and equipment inspection, enhancement, and repair efforts” in connection with a requirement that the Monitor “assess PG&E’s wildfire mitigation and wildfire safety work;”
|
•
|
“maintain traceable, verifiable, accurate, and complete records of its vegetation management efforts” and report to the Monitor monthly on its vegetation management status and progress; and
|
•
|
“ensure that sufficient resources, financial and personnel, including contractors and employees, are allocated to achieve the foregoing” and to forego issuing “any dividends until [the Utility] is in compliance with all applicable vegetation management requirements as set forth above.”
|
|
|
3.1
|
|
|
|
3.2
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
*10.3
|
|
|
|
*10.4
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
**32.1
|
|
|
|
**32.2
|
|
|
|
101.INS
|
XBRL Instance Document
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
101.LAB
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
PG&E CORPORATION
|
|
/s/ JASON P. WELLS
|
Jason P. Wells
Senior Vice President and Chief Financial Officer
(duly authorized officer and principal financial officer)
|
PACIFIC GAS AND ELECTRIC COMPANY
|
|
/s/ DAVID S. THOMASON
|
David S. Thomason
Vice President, Chief Financial Officer and Controller
(duly authorized officer and principal financial officer) |
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
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: May 2, 2019
|
/s/ WILLIAM D. JOHNSON
|
|
William D. Johnson
|
|
Chief Executive Officer and President
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
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: May 2, 2019
|
/s/ JASON P. WELLS
|
|
Jason P. Wells
|
|
Senior Vice President and Chief Financial Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
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 officers 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 officers 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: May 2, 2019
|
/s/ MICHAEL A. LEWIS
|
|
Michael A. Lewis
|
|
Senior Vice President, Electric Operations
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
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 officers 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 officers 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: May 2, 2019
|
/s/ JESUS SOTO, Jr.
|
|
Jesus Soto, Jr.
|
|
Senior Vice President, Gas Operations
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
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 officers 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 officers 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: May 2, 2019
|
/s/ JAMES M. WELSCH
|
|
James M. Welsch
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Vice President, Nuclear Generation and Chief Nuclear Officer
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1.
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I have reviewed this Quarterly Report on Form 10-Q for the quarter ended
March 31, 2019
of Pacific Gas and Electric Company;
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2.
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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;
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3.
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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;
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4.
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The registrant's other certifying officers 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:
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a.
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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;
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b.
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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;
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c.
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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
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d.
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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
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5.
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The registrant's other certifying officers 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):
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a.
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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
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b.
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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.
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Date: May 2, 2019
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/s/ DAVID S. THOMASON
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David S. Thomason
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Vice President, Chief Financial Officer and Controller
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(1)
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the Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of PG&E Corporation.
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/s/ WILLIAM D. JOHNSON
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William D. Johnson
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Chief Executive Officer and President
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(1)
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the Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of PG&E Corporation.
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/s/ JASON P. WELLS
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Jason P. Wells
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Senior Vice President and
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Chief Financial Officer
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(1)
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the Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Pacific Gas and Electric Company.
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/s/ MICHAEL A. LEWIS
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Michael A. Lewis
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Senior Vice President, Electric Operations
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(1)
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the Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Pacific Gas and Electric Company.
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/s/ JAMES M. WELSCH
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James M. Welsch
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Vice President, Nuclear Generation and Chief Nuclear Officer
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(1)
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the Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Pacific Gas and Electric Company.
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/s/ JESUS SOTO, Jr.
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Jesus Soto, Jr.
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Senior Vice President, Gas Operations
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(1)
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the Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Pacific Gas and Electric Company.
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/s/ DAVID S. THOMASON
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David S. Thomason
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Vice President, Chief Financial Officer and Controller
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