1. With the rising wildfire risks and increased use of operational mitigations like Public Safety Power Shutoffs, how do you plan to address customer concerns about reliability while accelerating undergrounding efforts, and what is your strategy for balancing safety and outages during this transition?
2. You've added $1 billion to your five-year capital plan due to growing customer demand, yet you maintain that your equity guidance remains unchanged; how will you finance this additional capital efficiently without impacting your credit ratings or requiring additional equity?
3. Considering you're just one notch below investment grade at Moody's and Fitch with a positive outlook, but faced a particularly challenging wildfire season, what specific actions are you taking to secure credit rating upgrades, and how confident are you in achieving investment-grade status in the near term?
4. With $5 billion of potential incremental capital investments pending regulatory approvals like the SB 410 supplemental, what are the key risks if these approvals are delayed or unfavorable, and how might that affect your growth projections and capital plans through 2028?
5. Given that the DOE loan would provide net savings for customers but isn't included in your financial plan, how are you managing the uncertainties around this potential funding source, and what contingencies are in place if these loans or grants do not materialize?

b0c635865392c98666e91d2a9f19399cf000e89d19a675c1c62f2bd96ebb3f4c

Current Assets [USD, Millions]

Cash and Cash Equivalents [USD, Millions]

Accounts Receivable [USD, Millions]

Inventory [USD, Millions]

Non-Current Assets [USD, Millions]

Property, Plant, and Equipment (PP&E) [USD, Millions]

Current Liabilities [USD, Millions]

Accounts Payable [USD, Millions]

Short-term Debt [USD, Millions]

Non-Current Liabilities [USD, Millions]

Long-term Debt [USD, Millions]

Lease Liabilities [USD, Millions]

Deferred Tax Liabilities [USD, Millions]

Shareholders' Equity [USD, Millions]

Retained Earnings [USD, Millions]

Common Stock [USD, Millions]

ed5351f1729e1f15e87a6b3191b28ae852724ec8c4c19782ab63090586788d52

Electric

Natural Gas

Total Revenue

d8f8fc5e457e1bb1d335ca56f770fcfcf8f884432fc138eee91df2390b917cce

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: FY 2024 and FY 2025
- **Guidance**:
  1. **Core Earnings Per Share (EPS) for 2024**: Narrowed to **$1.34 to $1.37**, with a firm expectation of **10% growth over 2023** at the midpoint  **[PCG_3406582_1]** .
  2. **2025 EPS Guidance**: Raised to **$1.47 to $1.51**, with a growth guidance of **10%**  **[PCG_3406582_2]** .
  3. **Long-term EPS Growth**: At least **9% each year from 2026 to 2028**  **[PCG_3406582_2]** .
  4. **Operating Cash Flow**: Over **$3 billion** more for the full year 2024  **[PCG_3406582_6]** .
  5. **Capital Expenditure (CapEx)**: Increased by $1 billion, totaling **$63 billion through 2028**  **[PCG_3406582_2]** .
  6. **Equity Guidance**: **$3 billion** of equity from 2025 through 2028  **[PCG_3406582_2]** .
  7. **Credit Rating**: On path to achieving investment-grade credit  **[PCG_3406582_6]** .

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Core Earnings Per Share (EPS)**: Reaffirmed **$1.33 to $1.37**, at least **10% growth from 2023**  **[PCG_3394354_1]** .
  2. **Capital Investment**: **$62 billion** over the next 5 years  **[PCG_3394354_4]** .
  3. **Rate Base Growth**: **9.5%** through 2028  **[PCG_3394354_6]** .
  4. **Operating and Maintenance (O&M) Cost Reduction**: **2% reduction** in non-fuel O&M costs for 2024  **[PCG_3394354_5]** .
  5. **Parent Debt Paydown**: **$2 billion** by the end of 2026  **[PCG_3394354_10]** .
  6. **Return on Equity (ROE)**: Increased to **10.7%**  **[PCG_3394354_1]** .
  7. **Dividend Growth**: Planned over the next 5 years  **[PCG_3394354_5]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Earnings Per Share (EPS) Guidance**: Reaffirmed **$1.33 to $1.37**, at least **10% increase from 2023**  **[PCG_3380760_1]** .
  2. **Long-term EPS Growth**: At least **9% each year from 2025 to 2028**  **[PCG_3380760_1]** .
  3. **Dividend Growth**: Planned over the next five years  **[PCG_3380760_5]** .
  4. **Capital Expenditure (CapEx) and Rate Base Guidance**: **$62 billion** over the next five years  **[PCG_3380760_4]** .
  5. **Operating Cash Flow**: From **$5 billion in 2023 to $8 billion in 2024**, totaling **$50 billion from 2024 through 2028**  **[PCG_3380760_4]** .
  6. **Equity and Debt Financing**: Up to **$3 billion** of equity starting in 2025  **[PCG_3380760_1]** .
  7. **Credit Ratings**: Targeting investment-grade ratings  **[PCG_3380760_5]** .
  8. **FFO to Debt Ratio**: Mid-teens ratio targeted  **[PCG_3380760_11]** .
  9. **Regulatory and Balance Sheet Targets**: **52% utility equity ratio by mid-2025**  **[PCG_3380760_13]** .

### Q4 2023 Earnings Call
- **Issued Period**: Q4 2023
- **Guided Period**: FY 2024
- **Guidance**:
  1. **Core Earnings and EPS Growth**: Reaffirmed **at least 10% growth target** for 2024, with a new midpoint of **$1.35**  **[PCG_3374566_1]** .
  2. **Rate Base and CapEx Growth**: **9.5% rate base growth** and a **20% increase** in the 5-year capital plan  **[PCG_3374566_6]** .
  3. **Operating Cash Flow**: From **$5 billion in 2023 to $11 billion by 2028**  **[PCG_3374566_6]** .
  4. **Financing**: No new equity in 2024  **[PCG_3374566_6]** .
  5. **Customer Bill Growth**: Limited to **2% to 4%** from 2023 through 2026  **[PCG_3374566_1]** .
  6. **Cost Savings**: **5.5% reduction** in nonfuel O&M costs in 2023, with continued **2% annual reductions**  **[PCG_3374566_1]** **[PCG_3374566_5]** .
  7. **Regulatory and Risk Management**: New ROE of **10.7%** and a mid-teens FFO to debt ratio targeted by 2024  **[PCG_3374566_1]** **[PCG_3374566_5]** .

92352224946e2646f99dbef0a1b9d3bada369c01fec955cbe00e1ce986432053

| Name               | Position                                                                 | Start Date         | Short Bio                                                                                                                                                                                                 |
|--------------------|--------------------------------------------------------------------------|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Patricia K. Poppe  | Chief Executive Officer, PG&E Corporation                                | January 4, 2021    | Patricia K. Poppe has been serving as the CEO of PG&E Corporation since **January 4, 2021**. She has over 15 years of experience in the utility industry, previously leading CMS Energy Corporation and Consumers Energy  **[0001004980-24-000044_pcg-20240404.htm:30]** **[0001004980-23-000072_pcg-20230331.htm:31]** **[0001004980-24-000044_pcg-20240404.htm:38]** .                |
| Carolyn J. Burke   | Executive Vice President and Chief Financial Officer, PG&E Corporation   | May 4, 2023        | Carolyn J. Burke became Executive Vice President and CFO of PG&E Corporation on **May 4, 2023**. She was a special advisor from January 3, 2023, and Executive Vice President, Finance from March 14, 2023  **[0001004980-24-000044_pcg-20240404.htm:100]** **[0001004980-24-000044_pcg-20240404.htm:50]** .                                  |
| John R. Simon      | Executive Vice President, General Counsel, and Chief Ethics & Compliance Officer, PG&E Corporation | N/A                | John R. Simon serves as the Executive Vice President, General Counsel, and Chief Ethics & Compliance Officer at PG&E Corporation. He has **16 years of industry experience**  **[0001004980-23-000092_pcg_defa14a.htm:2]** .                                                               |
| Jason M. Glickman  | Executive Vice President, Engineering, Planning & Strategy, Pacific Gas and Electric Company | May 2021           | Jason M. Glickman has been serving in his current role since **May 2021**. He is a principal executive officer involved in engineering, planning, and strategy  **[0001004980-24-000044_pcg-20240404.htm:39]** **[0001004980-24-000044_pcg-20240404.htm:64]** .                                                                             |
| Marlene M. Santos  | Executive Vice President and Chief Customer Officer and Enterprise Solutions Officer, Pacific Gas and Electric Company | March 2021         | Marlene M. Santos has been the Executive Vice President and Chief Customer Officer since March 2021. Her role expanded to include Enterprise Solutions Officer responsibilities in October 2023  **[0001004980-24-000044_pcg-20240404.htm:39]** **[0001004980-24-000044_pcg-20240404.htm:64]** .                                           |
| Sumeet Singh       | Executive Vice President, Operations and Chief Operating Officer, Pacific Gas and Electric Company | March 1, 2023      | Sumeet Singh has been serving as the EVP, Operations and COO since **March 1, 2023**. He has held various roles at PG&E, including Chief Risk and Chief Safety Officer, and has extensive experience in utility operations and risk management  **[0001004980-24-000044_pcg-20240404.htm:32]** **[0001004980-24-000044_pcg-20240404.htm:39]** **[0001004980-23-000072_pcg-20230331.htm:21]** . |
| Stephanie N. Williams | Vice President, Chief Financial Officer, and Controller, Pacific Gas and Electric Company | January 10, 2023   | Stephanie N. Williams serves as the Vice President, CFO, and Controller of Pacific Gas and Electric Company, elected to this position effective **January 10, 2023**  **[0001004980-24-000044_pcg-20240404.htm:56]** **[0001004980-24-000044_pcg-20240404.htm:100]** .                                                                     |

ab0cd3eab89eb4a5c21baf2b32d2c33ecb11424b9f7e5a5d2a8c6080319b3329

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

d643f084f7bda9f1766a5227d553c10a676ec1c83aaef79450347e23e1195b07

Net Income [USD, Millions]

d2ce546c46c9ed031e58f496b395675707808e29384bf5a1c198c167d1fefc02

**Annual guidance for FY 2024:**
- **Core Earnings Per Share (EPS)**: $1.34–$1.37  **[PCG_3406582_1]**  (raised from $1.33–$1.37  **[PCG_3394354_1]** )  
- **Capital Expenditure (CapEx)**: $63 billion  **[PCG_3406582_2]**  (raised from $62 billion  **[PCG_3394354_4]** )  
- **Operating Cash Flow**: Over $3 billion  **[PCG_3406582_6]**  (no prior guidance)

**Annual guidance for FY 2025:**
- **Core Earnings Per Share (EPS)**: $1.47–$1.51  **[PCG_3406582_2]**  (no prior guidance)

**Additional multi-year guidance:**
- **Long-term EPS Growth (2026–2028)**: At least 9% each year  **[PCG_3406582_2]**  (no prior guidance)  
- **Equity Guidance (2025–2028)**: $3 billion  **[PCG_3406582_2]**  (no prior guidance)  
- **Credit Rating**: On path to achieving investment-grade credit  **[PCG_3406582_6]**  (no prior guidance)

0d2416a2f156a6c0f9a08c046d6b7e76aa750e49802de3e106a8ab6c605f6541

| Name                   | Start Date | End Date | Reason for Change |
|------------------------|------------|----------|-------------------|
| Deloitte & Touche LLP  | 1999  **[0001004980-24-000014_pcg-20231231.htm:241]**  | Present  | Current auditor   |

db9097320d539c58ce686b669d554306aabd4063e7c50fc80c770f1ea0c4e95a

- Total Revenue: $5,941 million  **[0001004980-24-000121_pcg-20240930.htm:47]** **[0001004980-24-000121_pcg-20240930.htm:16]** **[0001004980-24-000121_pcg-20240930.htm:41]**   
- Electric Segment: $4,538 million  **[0001004980-24-000121_pcg-20240930.htm:47]**   
- Natural Gas Segment: $1,403 million  **[0001004980-24-000121_pcg-20240930.htm:47]**   
- Net Income: $705 million  **[0001004980-24-000121_pcg-20240930.htm:47]** **[0001004980-24-000121_pcg-20240930.htm:16]** **[0001004980-24-000121_pcg-20240930.htm:48]** **[0001004980-24-000121_pcg-20240930.htm:41]** **[0001004980-24-000121_pcg-20240930.htm:50]**   

0d06673c07cdc79218570cfaf503f72045314757302fe1ef71e284544a88ad5e

ee7f37ff8bb7df97a937274b1c58e852d1c85e667876ad26e9412dd649a6f80c

- **Strong Financial Performance and EPS Growth**: PG&E reported core earnings of **$1.06 per share** for the first nine months of 2024, up **$0.30** over the same period last year, driven by higher customer capital investment and O&M savings. The company extended its guidance of at least **10% core EPS growth** through 2025.  **[PCG_3406582_4]**
- **Increased Capital Plan and Rate Base Growth**: PG&E increased its five-year capital plan by **$1 billion**, resulting in a compound annual growth rate in rate base of **10%**. This incremental capital is expected to be accretive to earnings per share and supports further customer growth.  **[PCG_3406582_21]** **[PCG_3406582_8]**
- **Operational Improvements and Load Growth Opportunities**: The company is achieving O&M cost savings through nearly **200 initiatives**, reducing expenses by **5.5%** in 2023 and targeting further reductions. Additionally, PG&E anticipates load growth from electric vehicles, data centers, and building electrification, contributing positively to future earnings.  **[PCG_3406582_21]** **[PCG_3406582_5]**

25348d70ef256ae592855658bbe3bbf0ea0be7daca532b2ea3302d594e1d2ae6

1. **Financing for Incremental Capital**  
   **Q:** Framework for financing additional capital?  
   **A:** Management emphasizes a balanced, flexible financing plan for new capital investment. They aim for affordability for customers, accretion to EPS, and strengthening the balance sheet without issuing equity, while meeting growth targets. Flexibility comes from dividend ramp-up and parent debt paydown of **$2 billion by end of 2026**. They will follow the authorized regulatory structure and consider market conditions.  **[PCG_3394354_10]** 

2. **Undergrounding Plan and Wildfire Risk**  
   **Q:** Status of undergrounding amid active fire season?  
   **A:** PG&E remains committed to undergrounding in high-risk areas as a critical safety measure. They have **1,230 miles approved** in the GRC through 2026 and are on track to meet mileage requirements. No incremental mileage is expected outside of the next GRC or the 10-year plan. Despite high fuel levels due to earlier moisture, they have advanced safety measures including AI-enabled cameras and partnerships with CAL FIRE, contributing to a differentiated safety posture in California.  **[PCG_3394354_8]** **[PCG_3394354_13]** **[PCG_3394354_24]** 

3. **Load Growth from Data Centers and EVs**  
   **Q:** Update on data center and EV load growth?  
   **A:** PG&E sees significant potential in data center load growth, with only a few hundred megawatts currently in the capital plan and a cluster study underway revealing higher demand. Electric vehicle adoption is strong, with **610,000 EVs** on the road in California, up from **580,000**, and **25%** of new vehicles sold being electric, contributing to beneficial load growth.  **[PCG_3394354_11]** 

4. **O&M Savings Target Progress**  
   **Q:** Progress on O&M savings target?  
   **A:** PG&E is on track to meet or exceed the **2%** O&M reduction target this year, with initiatives from both smaller and larger projects. Savings materialize more significantly in the second half of the year. They emphasize waste elimination through their Lean playbook, engaging employees to identify efficiencies, aiming for a culture of performance.  **[PCG_3394354_16]** **[PCG_3394354_23]** 

5. **Bill Increases and Regulatory Outlook**  
   **Q:** Outlook on bill increases amid regulatory concerns?  
   **A:** Management believes they can maintain rate increases below the rate of inflation through their simple, affordable model, which includes O&M savings and efficient financing. They acknowledge that some interveners may not yet understand this new approach but are confident in proving its effectiveness over time.  **[PCG_3394354_18]** 

6. **SB 410 Capital Funding**  
   **Q:** Plans for incremental requests under SB 410?  
   **A:** PG&E recognizes that demand is outstripping the **$2.3 billion** cap approved by the commission. They plan to make additional filings based on customer demand to secure funding for necessary infrastructure to support load growth, ensuring affordability and balance sheet health.  **[PCG_3394354_12]** **[PCG_3394354_17]** **[PCG_3394354_20]** 

7. **Fire Protection Index and Outlook**  
   **Q:** Fire risk outlook for remainder of year?  
   **A:** The Fire Threat Index shows more days with higher risk conditions due to low fuel moisture levels. PG&E is prepared with enhanced safety measures and forecasts continued vigilance until environmental conditions improve.  **[PCG_3394354_21]** 

8. **Management Continuity**  
   **Q:** CEO's thoughts on contract extension?  
   **A:** The CEO expresses commitment to building a lasting system through a performance playbook and strong team, aiming to ensure continued service standards beyond her tenure. She emphasizes that the company's success is not reliant on one individual.  **[PCG_3394354_14]** 

f29f932a844b28efc27b4326704e0e2f52ab2d6d2494b75649f4a5365131691d

b53f7ccc6a4e3d2b6a223c0385df51471cb44d254094b592ac34563475933b0f

| Year  | Amount Due (Millions) | Debt Type                     | Interest Rate (%) | % of Total Debt                     |
|-------|------------------------|-------------------------------|-------------------|--------------------------------------|
| 2025  | 1,000                 | Floating Rate First Mortgage Bonds | N/A               | 1.7% = (1,000 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:43]** **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2027  | 2,150                 | Convertible Senior Secured Notes | 4.25             | 3.6% = (2,150 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:67]** |
| 2029  | 850                   | First Mortgage Bonds          | 5.550            | 1.4% = (850 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2034  | 1,100                 | First Mortgage Bonds          | 5.800            | 1.9% = (1,100 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2035  | 300                   | Senior Secured Recovery Bonds | 4.838            | 0.5% = (300 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2042  | 373                   | Senior Secured Recovery Bonds | 5.231            | 0.6% = (373 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2051  | 746                   | Senior Secured Recovery Bonds | 5.529            | 1.3% = (746 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2053  | 300                   | First Mortgage Bonds          | 6.750            | 0.5% = (300 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |
| 2054  | 750                   | First Mortgage Bonds          | 5.900            | 1.3% = (750 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:67]** |
| 2055  | 1,000                 | Junior Subordinated Notes     | 7.375            | 1.7% = (1,000 / 58,898) * 100 **[0001004980-24-000121_pcg-20240930.htm:24]** |

f45025e38a8d07aaa7499c6eac2e00c38b4bc7262b7f6e78c8315a2b1085d9cf

1. **$1 Billion CapEx and EPS Growth**  
   **Q:** Was the $1B CapEx increase the driver of 10% EPS growth?  
   **A:** Yes, the additional **$1 billion** in CapEx was the key driver for increasing EPS growth to **10%**.  **[PCG_3406582_8]**  This disciplined approach ensures approved CapEx that's affordable, accretive to EPS, and efficiently financed.  **[PCG_3406582_8]** 

2. **Funding Without New Equity**  
   **Q:** How do you fund the $1B CapEx with no new equity?  
   **A:** The $1 billion CapEx was funded by issuing **junior subordinated notes** with **50% equity content**.  **[PCG_3406582_9]**  This efficient financing means no changes to our equity plan; we're issuing a routine **$3 billion ATM program** over five years, with **no new equity in 2024**.  **[PCG_3406582_9]** 

3. **Data Center Load Growth**  
   **Q:** What's the status of the 3.5 GW data center pipeline?  
   **A:** We're completing our first cluster study with **3.5 GW** of requests from multiple customers.  **[PCG_3406582_15]**  Demand is strong, confirming significant capacity available.  **[PCG_3406582_15]**  Last year, we added **9.5 GW** of new supply and **10 GW** of battery storage in California.  **[PCG_3406582_15]** 

4. **Additional $5B CapEx Potential**  
   **Q:** How do you view the $5B in incremental investments?  
   **A:** We have a robust pipeline and could add an additional **$5 billion** of CapEx as it meets our criteria.  **[PCG_3406582_17]**  This includes transmission, data centers, IT improvements, generation, hydros, and EV-related capital.  **[PCG_3406582_17]**  Despite adding $1B this quarter, the **$5B potential remains unchanged**.  **[PCG_3406582_17]** 

5. **Undergrounding Strategy**  
   **Q:** What's the update on undergrounding guidelines and plans?  
   **A:** We're working with OEIS to establish filing requirements, aiming to file by **mid-2025**.  **[PCG_3406582_12]**  Undergrounding is the right solution for our highest risk areas, offering long-term cost benefits and safety without compromising reliability.  **[PCG_3406582_12]** 

6. **Wildfire Mitigation and Agency Relations**  
   **Q:** Any updates on wildfire risk discussions with agencies?  
   **A:** The focus is on making the system safer faster, with current mitigations working effectively.  **[PCG_3406582_16]**  We discuss acceptable outage levels given risks, advocating undergrounding as it eliminates both PSPS and wildfire risks.  **[PCG_3406582_16]**  Our progress includes **no major fires** and **limited structural damage** over multiple years.  **[PCG_3406582_16]** 

7. **Affordability Initiatives**  
   **Q:** Thoughts on Governor's executive order on affordability?  
   **A:** We share the goal of affordable energy and are implementing our **simple affordable model**.  **[PCG_3406582_10]**  Our upcoming **2027 rate case** filing will demonstrate cost reductions and load growth benefits, aiding customer affordability as we invest in infrastructure.  **[PCG_3406582_10]** 

8. **DOE Loans and Election Impact**  
   **Q:** How might the election affect potential DOE loans?  
   **A:** The DOE loan process is confidential, but resolution is possible before year-end.  **[PCG_3406582_11]**  We like the DOE loan for net savings to customers but haven't included it in our financial plan; it would be **upside and accretive**.  **[PCG_3406582_11]** 

9. **Credit Rating Improvements**  
   **Q:** Where do you stand on FFO to debt and ratings?  
   **A:** We're on track to reach **mid-teens** FFO to debt by year-end, showing significant improvement.  **[PCG_3406582_16]**  We're **one notch below investment grade at Moody's**, meeting financial metrics, and optimistic about our discussions.  **[PCG_3406582_16]** 

10. **Asset Sales Not Planned**  
    **Q:** Are asset sales part of efficient financing plans?  
    **A:** Asset sales are **not** on our list; we don't see them as a primary source of efficient financing.  **[PCG_3406582_20]**  We're not moving forward with **Pac Gen** and have no plans for monetizing assets.  **[PCG_3406582_20]** 

b3cbf5c2e61961175c5690cd53f715a6fea512daa6953a398a32672df24ba4ea

- **PG&E is delivering strong financial performance**, projecting **9.5% rate base growth** through 2028 and at least **10% core earnings per share growth in 2024**, followed by at least **9% growth** from 2025 to 2028.  **[PCG_3394354_6]**
- **PG&E has significantly reduced wildfire risk**, with Moody's RMS wildfire model estimating a **93% reduction** in potential economic loss due to their mitigation efforts.  **[PCG_3394354_2]**
- **PG&E is making progress on its undergrounding initiatives**, reaffirming its target of **250 miles** for the year, with process improvements ensuring they are **on track**.  **[PCG_3394354_24]**

be579d2399fd6282b666d1a283431ec2f400b39150396ca6b9531877f5fc2100

- **Operational savings may be behind schedule**: PG&E reported year-to-date O&M savings of **$52 million** versus the **targeted $200 million**, achieving only **25%** of the target halfway through the year, raising concerns about meeting the full-year savings goal.  **[PCG_3394354_23]**
- **Financing and debt reduction challenges**: The company acknowledges flexibility in its plan to pay down **$2 billion** of parent debt by **2026**, indicating potential delays or adjustments, which may impact credit improvement timelines and the ability to finance additional capital expenditures.  **[PCG_3394354_15]**
- **Potential for higher customer bills due to regulatory concerns**: Interveners like Cal Advocates are predicting **double-digit percent increases** in customer bills over the next several years, suggesting that PG&E's assumption of keeping rate increases below inflation might face challenges, potentially affecting customer satisfaction and regulatory relations.  **[PCG_3394354_18]**

3c654138fde9ab2b604ac090256b6b56abb2e61a216702b02c548285fe58df12

- **PG&E extended its core EPS growth guidance of at least 9% through 2028, demonstrating strong confidence in its long-term growth prospects.**  **[PCG_3374566_23]**
- **The company commits to no new equity issuance in 2024 and has multiple efficient financing options beyond 2024, including retained earnings and utility debt, which are accretive to earnings.**  **[PCG_3374566_10]**
- **Constructive regulatory relationships, evidenced by positive discussions with regulators regarding the Pac Gen transaction, position PG&E to capitalize on clean energy opportunities and support future growth.**  **[PCG_3374566_9]**

caf0ba94d002364ec4f1a7cbd674f314a2b7922d06f798eff104f5ab10808e50

1. **Earnings Growth Guidance**  
   **Q:** What are your updated EPS growth projections?  
   **A:** PG&E raised and extended its core EPS guidance, expecting **12% growth in 2023**, **at least 10% in 2024**, and **at least 9% annually through 2028**.  **[PCG_3374566_9]** 

2. **Equity Financing Plans**  
   **Q:** Will you need to issue new equity soon?  
   **A:** The guidance includes **no new equity in 2024, with or without the Pac Gen transaction**. We have several financing options, including retained earnings and utility debt. It's too soon to size a potential ATM equity program in 2025, and we'll only consider it if accretive to our guidance.  **[PCG_3374566_9]** **[PCG_3374566_16]** 

3. **Dividend Growth Outlook**  
   **Q:** How are you approaching dividend growth?  
   **A:** Our intent is to achieve a competitive payout ratio and show meaningful progress over the next five years. Given our low starting point, the dividend growth rate will be **dramatically different from peers** during this period.  **[PCG_3374566_11]** 

4. **Pac Gen Transaction Status**  
   **Q:** What's the status of the Pac Gen sale approval?  
   **A:** Communications with the commission have been constructive. The extended time allows us to better align on the benefits, including customer affordability and advancing California's clean energy goals. We remain confident in the transaction.  **[PCG_3374566_9]** **[PCG_3374566_12]** 

5. **Credit Rating and Investment Grade Path**  
   **Q:** What are the milestones to achieve investment-grade credit rating?  
   **A:** We're focused on improving credit metrics, targeting **mid-teens FFO to debt in 2024**. Rating agencies are looking at wildfire risk mitigation and governance improvements. We expect sustained high cash flows and positive outlooks from both Moody's and S&P.  **[PCG_3374566_14]** **[PCG_3374566_22]** 

6. **Capital Expenditure Plans**  
   **Q:** How will you finance your incremental CapEx?  
   **A:** We have an additional **$5 billion** in new CapEx. We'll ensure it's financed affordably, considering options like utility debt and potential asset sales. Our financing choices will be accretive to earnings.  **[PCG_3374566_13]** **[PCG_3374566_16]** 

7. **Load Growth and Data Center Demand**  
   **Q:** Is data center demand affecting your load growth projections?  
   **A:** Yes, we experienced a **3x increase in data center applications in 2023** compared to the prior four years. This contributes to higher load growth forecasts, especially in the latter part of our five-year plan.  **[PCG_3374566_24]** 

8. **Undergrounding Initiatives**  
   **Q:** Can you update us on your undergrounding plans?  
   **A:** Last year proved we can underground lines at scale and affordably. Due to the rate case, we'll underground about **250 miles** this year. We'll file our ten-year undergrounding plan as required, aiming to enhance climate-resilient infrastructure.  **[PCG_3374566_17]** 

9. **Cost of Capital Proceeding**  
   **Q:** What's the impact if the cost of capital trigger doesn't hold?  
   **A:** The impact on monthly bills is very minor, just a couple of dollars. We've planned conservatively for either outcome, and it doesn't affect our 2024 earnings guidance.  **[PCG_3374566_20]** **[PCG_3374566_23]** 

10. **Lean Enterprise Maturity**  
    **Q:** What does your 44% enterprise lean maturity score indicate?  
    **A:** It reflects our assessment of leaders' adoption of lean practices. The **44% score shows significant room for improvement**, which can lead to further O&M savings and process efficiencies as we mature.  **[PCG_3374566_19]** 

87b0d4e575ec7d1345600bf3eaf070d76949599b2f49d24f8551520393b11732

- **Planned Equity Dilution:** PG&E plans to issue up to **$3 billion in equity starting in 2025** through a routine ATM program, which could dilute existing shareholders.  **[PCG_3380760_20]**
- **Supply Chain Delays Impacting Growth Opportunities:** **Supply chain challenges** are delaying PG&E's ability to connect new large loads like data centers, potentially hindering growth and future revenues.  **[PCG_3380760_11]**
- **Significant Wildfire Liabilities:** PG&E is facing **$1.6 billion in liabilities** from the Dixie Fire and cannot access the earthquake fund until **$1 billion** in settlements are paid, which may strain financial resources.  **[PCG_3380760_14]**

edcd33b41414c30fbb23a4a32110b783f6e0b82b39d29dff54e5ead38fe4105d

1. **Financing Plan and Equity Needs**  
   **Q:** Can you elaborate on equity needs and dividend timing?  
   **A:** Management explained they built a plan assuming a reasonable balance of utility debt, parent company debt, dividend growth, and routine equity financing.  **[PCG_3380760_8]**  The plan includes a **$2.5 billion** dividend use of funds, which will grow more slowly in the front end of the 5-year plan and ramp up over time.  **[PCG_3380760_8]**  They also introduced a routine ATM program expected to be ratable over the plan period.  **[PCG_3380760_8]** 

2. **Dividend Growth Trajectory**  
   **Q:** Is dividend growth slower in cents or percent basis?  
   **A:** Management intends to achieve a competitive payout ratio over the long term.  **[PCG_3380760_10]**  They will start slower in the first half of the 5-year plan due to prioritizing customer capital investment, then ramp up more quickly later.  **[PCG_3380760_10]**  Combined with their forecasted **at least 9% EPS growth** from 2025 to 2028, they believe this offers a compelling investment thesis.  **[PCG_3380760_10]** 

3. **Wildfire Risk Mitigation**  
   **Q:** Thoughts on Buffett's letter about wildfire risk?  
   **A:** Management believes Buffett got it wrong regarding California.  **[PCG_3380760_9]**  They have reduced **94%** of wildfire risk, with the remaining **6%** protected by situational awareness and state investments.  **[PCG_3380760_9]**  Investor exposure is limited to a **$50 million** deductible due to self-insurance.  **[PCG_3380760_9]**  They extended the wildfire fund's life to **20 years**, showing their risk reduction efforts are working.  **[PCG_3380760_9]** 

4. **Data Center Growth Opportunity**  
   **Q:** How are you addressing data center demand?  
   **A:** Management stated they are positioned to benefit from demand growth from data centers and electric transportation.  **[PCG_3380760_12]**  They are engaging with major customers like AWS, Microsoft, Apple, and Google.  **[PCG_3380760_12]**  The California ISO forecasts an additional **120 gigawatts** of clean electricity over 20 years, doubling the current system.  **[PCG_3380760_12]**  They aim to be the energy provider fueling these ambitious goals.  **[PCG_3380760_12]** 

5. **FFO to Debt Ratio Improvement**  
   **Q:** Is FFO to debt ratio improving over time?  
   **A:** Management confirmed they remain on target with capital investment and EPS growth. Operating cash flow increases by **$3 billion** from 2023 to 2024, driving improved balance sheet health and credit metrics over the plan period.  **[PCG_3380760_11]** 

6. **Investment Grade Status Progress**  
   **Q:** What's the timeline for achieving investment grade?  
   **A:** Management continues to make good progress toward investment grade status.  **[PCG_3380760_8]**  They intend to meet regulatory and balance sheet targets, including a **52%** utility equity ratio by mid-2025 when the waiver expires.  **[PCG_3380760_13]** 

7. **Authorized Capital Structure**  
   **Q:** Do you assume returning to authorized capital structure?  
   **A:** Management confirmed their plan meets regulatory and balance sheet targets, including the **52%** utility equity ratio by mid-2025, aligning with the waiver expiration.  **[PCG_3380760_13]** 

8. **Liability and Earthquake Fund**  
   **Q:** Update on $1.6B liability and tapping earthquake fund?  
   **A:** Management has paid **$870 million** in cash settlements as of Q1.  **[PCG_3380760_14]**  They cannot tap the earthquake fund until settling **$1 billion**, expected over the summer.  **[PCG_3380760_14]**  They are working closely with the earthquake authority for a smooth claims process.  **[PCG_3380760_14]** 

486047c09577c9ea9674f1e9581a716858a204b1c67e74f2bdaea89f11c09f1f

- **PG&E may need to reintroduce an at-the-market (ATM) equity program in 2025** to finance an additional **$5 billion** in incremental capital expenditures, potentially leading to dilution for shareholders.  **[PCG_3374566_9]** **[PCG_3374566_10]** **[PCG_3374566_13]**
- **Uncertainty surrounding the approval of the Pacific Generation (Pac Gen) transaction** could impact PG&E's financing plans, as delays may require the company to seek alternative funding options that might be less favorable.  **[PCG_3374566_9]**
- **PG&E has not yet achieved investment-grade credit ratings**, and while progress has been made, reaching this milestone depends on improving credit metrics and mitigating wildfire risks, posing challenges to financial stability.  **[PCG_3374566_14]**

8063acf70b79e23ab53a1b2b34aa73b8599928550f70eeb9adbe16ac486e980b

- **Regulatory approval uncertainty for future capital expenditures:** PG&E's earnings growth is heavily reliant on significant capital expenditure plans, such as the additional funding requested in the supplemental SB 410 filing. The company acknowledges that they won't include this in their plan until they meet their criteria, indicating uncertainty in securing regulatory approval.  **[PCG_3406582_8]**
- **Potential regulatory pushback on undergrounding costs:** There is concern about the cost-effectiveness of undergrounding as a wildfire mitigation strategy. The CEO mentions that some policy decision-makers and interveners do not understand the actual math, which could lead to challenges in obtaining approval for these investments.  **[PCG_3406582_14]**
- **Credit rating below investment grade:** PG&E remains **one notch below investment grade** at Moody's and Fitch, affecting their financing costs and potentially hindering their ability to fund future investments efficiently.  **[PCG_3406582_16]**

cdf75cee7d71df1a850f1e604dcd7f392c8092785ca63f3e45c1db7963264e3f

PG&E Corp (PCG)

Financials