PG&E Corporate Responsibility and Sustainability Report 2018

PG&E Chapter 11 Update

Public Policy Engagement

As a regulated energy provider, PG&E’s business is guided significantly by public policy at the local, state, regional and national levels. We participate in the political process on a wide range of policy matters that are important to both PG&E and our customers, because the evolution of these policies plays a critical role in how we deliver safe, reliable, affordable and clean energy to customers, and defines the structure of the energy market.

Our Approach

PG&E advocates for public policies that help us to better meet the needs of our customers and employees, while adding value for our shareholders and furthering our goal of environmental leadership.

Much of our public policy work, including engagement with elected officials and policymakers, is done in collaboration with other organizations, as well as trade organizations like the Edison Electric Institute, the American Gas Association, the Interstate Natural Gas Association of America, the Nuclear Energy Institute and the National Hydropower Association. Additionally, we partner with the International Brotherhood of Electrical Workers (IBEW) and the International Federation of Professional and Technical Engineers and other labor organizations on national energy policy, and with the IBEW Local 1245, the California Coalition of Utility Employees, the California Council for Environmental and Economic Balance, and other electric or gas energy providers on state energy policy.

Public Policy Governance at PG&E

The Compliance and Public Policy Committee of the PG&E Corporation Board of Directors maintains oversight of public policy matters. At the senior management level, the Executive Vice President, Law, Strategy and Policy of PG&E Corporation leads the development and implementation of PG&E’s public policy activities.

The Compliance and Public Policy Committee reviews PG&E’s political contributions program. The PG&E Corporation and Pacific Gas and Electric Company Boards of Directors establish management approval limits for political contributions from PG&E to candidates, measures, initiatives, corporate political action committees and certain other organizations that may engage in political activity. These approval authorizations may be delegated further within PG&E. The Compliance and Public Policy Committee also directs the preparation of an annual report detailing political contributions made by PG&E during the preceding year.

PG&E Corporation and its affiliates and subsidiaries are committed to fully complying with all applicable federal, state, local and foreign political laws, and to maintaining the highest ethical standards in the way we conduct our business.

PG&E makes corporate political contributions to:

  • Candidates for state and local office,
  • Political action committees (PACs),
  • Political parties and other organizations that engage in voter registration and similar activities that encourage citizen involvement in the political process, and
  • Nonprofit organizations, including those formed under Sections 501(c)(4) and 527 of the Internal Revenue Code.

Along with civic, charitable and volunteer activities, employees can participate in PG&E’s political engagement. All eligible employees may make voluntary contributions to the following PACs: PG&E Corporation Employees EnergyPAC and Pacific Gas and Electric Company State and Local PAC. PAC contributions go directly to support candidates for elective office and political parties at both the federal and state levels, as well as other political action committees. By law, PG&E cannot use corporate funds to make contributions to federal candidates.

Recent Highlights

Public Policy Issues at the State Level

The 2018 legislative year was defined by the need to address catastrophic wildfires. PG&E strongly advocated for ensuring financially healthy utilities to maintain our clean, reliable and affordable delivery of energy. PG&E also advocated for state investment in forest management and for streamlined vegetation management practices across the state.

Additionally, in 2018 the state passed legislation creating a state policy of a 100 percent clean energy goal by 2045 under Senate Bill (SB) 100. PG&E reached California’s 2020 RPS target three years ahead of schedule and we are on our way to meet the state’s new 60 percent by 2030 RPS mandate set forth in SB 100.

PG&E also advocated at the California Air Resources Board (CARB) on climate issues, including the implementation of SB 398, which extended the state’s cap-and-trade program through 2030. Specifically, PG&E’s advocacy helped ensure customer protection by securing a first-ever “ceiling price” on carbon market allowance prices.

Also in 2018, PG&E supported CARB’s efforts to dedicate the vast majority of Low Carbon Fuel Standard (LCFS) credits from electric vehicle (EV) charging to a point-of-sale incentive program to ensure EV buyers receive a lower purchase price on vehicles. This incentive program is in addition to existing state and federal tax credits and rebate programs, and will help place EVs on a competitive footing with internal-combustion-engine vehicles.

With regard to wildfire prevention and response, PG&E joined a broad coalition of supporters of SB 901, which included measures to address the needs of wildfire victims, wildfire prevention and response, protections for electric customers, and continued progress toward California’s clean energy economy.

While SB 901 addressed many urgent needs, we must continue to work together to ensure ongoing investment in climate resilience and clean energy, and to combat the devastating threat that extreme weather and climate change pose to our state’s shared energy future.

Public Policy Issues at the Federal Level

Selected public policy issues at the federal level include:

  • Infrastructure resilience. We support efforts to spur investment in our energy infrastructure, including increasing resilience in the face of climate change, protecting the physical and cyber security of the system, implementing a smarter grid and advancing smart policies that stimulate continued critical investments for PG&E and the U.S. economy.
    For example, PG&E supported amendments to the SAFETY Act meant to increase cybersecurity protections within the supply chain by providing liability limits in the event of a physical or cyber “act of terrorism.” In 2018, Senator Steve Daines (R-MT) introduced the Cyber SAFETY Act of 2018, which PG&E supported.
  • Increasing community resilience. PG&E supports disaster relief funding for the California wildfires and is engaging with federal policymakers on ways to increase resilience to national disasters. For example, PG&E supported efforts to provide federal disaster relief for 2018 wildfires, hurricanes and flooding through the 2018 Supplemental Appropriations bill and supported the Disaster Relief and Recovery Act of 2018, which sets aside pre-disaster funding for community resilience projects.
  • Clean energy policy. We are focused on action related to grid innovation and reliability; renewable energy and storage research, deployment and adoption; hydropower licensing modernization; and energy efficiency standards.
  • Carbon reduction policies. We are active participants through coalitions and direct engagement with elected officials in support of California’s stringent corporate average fuel economy and tailpipe emissions standards, as well as advancing electric vehicle adoption by providing tax incentives and support for charging infrastructure. We also work with broad industry and non-governmental entity coalitions to advocate for a federal price on carbon to reduce greenhouse gas emissions.
  • Pipeline safety. PG&E has engaged at the federal level to educate elected officials and key policymakers about our commitment to making critical investments in natural gas infrastructure.
  • Permitting modernization. PG&E advanced policies to promote timely decision-making surrounding infrastructure and modernize the permitting process to make it more efficient, understandable and predictable. Our focus is advocating and advancing legislation that would provide a greater level of regulatory clarity and certainty for hydropower development and production, including reducing the cost, redundancies and time of the relicensing process.
  • Customer affordability. PG&E continues to engage at the federal level to support the implementation of the 2017 Tax Cuts and Jobs Act, which will save PG&E customers approximately $450 million annually in tax savings. We also advocated for Congress to provide sufficient federal funding for the Low Income Home Energy Assistance Program (LIHEAP), which provides much needed energy bill payment assistance to PG&E customers on fixed and low incomes. In September 2018, Congress passed, and the President signed into law, a spending package that included $3.65 billion for LIHEAP funding, a 9 percent increase from the previous year.

Measuring Progress

In 2018, PG&E-affiliated employee PACs (EnergyPAC and State and Local PAC) made contributions of $494,271 at the federal level and $47,500 at the state and local level. PG&E contributed $3,599,945 to state and local political candidates, ballot measures, political parties and other committees. Our annual political contributions are publicly reported on PG&E Corporation’s website.

Political Contributions, 2018
PG&E Corporation Employee Federal PAC Contributions
U.S. House $296,500
U.S. Senate $67,271
Other Federal PACs and Committees $130,500
Total $494,271
Pacific Gas and Electric Company Employee State and Local PAC Contributions
Total $47,500
Corporate Campaign Contributions
Total Corporate Contributions to Candidates $563,295
Total Corporate Contributions to Other Committees $3,036,650
Total $3,599,945

PG&E also discloses its policies and procedures regarding its lobbying activities and trade association payments, including the portions of any annual trade association membership dues over $50,000, to the extent those dues are used for lobbying purposes.

Trade Association Dues, 2018 Footnote 1
Portion of Dues That Were Nondeductible
Total $406,467
  • 1. Represents the portion of membership dues to trade associations that was nondeductible under Section 162(e)(1) of the Internal Revenue Code. Includes trade associations that received annual membership dues over $50,000. The reported amount is based on information provided by the trade associations to PG&E Corporation and Pacific Gas and Electric Company.1