July 26, 2018
ISSUED BY:   PG&E Corporation, 1-415-973-5930

PG&E Corporation Reports Second-Quarter 2018 Financial Results

Related Documents
Press Release and Selected Exhibits
Presentation and Complete Earnings Exhibits

SAN FRANCISCO, Calif. — PG&E Corporation's (NYSE: PCG) recorded second-quarter 2018 net losses attributable to common shareholders were $984 million or $1.91 per share, as reported in accordance with generally accepted accounting principles (GAAP). This compares with net income available to common shareholders of $406 million, or $0.79 per share, for the second quarter of 2017.

GAAP results include items that management does not consider part of normal, ongoing operations (items impacting comparability), which totaled $1.6 billion after-tax, or $3.07 per share, for the quarter. This was primarily driven by a $2.5 billion pre-tax charge for estimated third-party claims related to 14 of the Northern California wildfires, partially offset by probable insurance recoveries. Items impacting comparability for the quarter also include Utility clean-up and repair costs, legal and other costs related to the Northern California wildfires, as well as legal costs related to the Butte fire, costs to clear pipeline rights-of-way, and probable cost recoveries of insurance premiums incurred in 2017 above amounts included in authorized revenue requirements.

"With an intense wildfire season already upon us, PG&E is taking additional precautionary steps in response to last year's wildfires through our Community Wildfire Safety Program. This includes new technologies and practices intended to improve fire prevention and response to help keep our customers and communities safe. At the same time, we continue to advocate for comprehensive policy reforms, including reforming the flawed legal doctrine of inverse condemnation, that are essential to our state achieving its important climate and clean energy goals," said PG&E Corporation CEO and President Geisha Williams.

Operational highlights from the second quarter related to wildfire preparedness and response include:

  • Began daily aerial fire detection patrols across thousands of miles of PG&E's service area to assist forest and fire agencies with early fire detection and response. Seven planes will fly daily routes over the next several months.
  • Secured and deployed two new heavy-lift helicopters to support critical utility work and assist with wildfire response efforts, as requested by fire agencies.
  • Installed additional weather stations to capture real-time data to improve awareness of fire danger conditions. A total of 200 new weather stations are set to be installed in 2018.
  • Began new vegetation work to expand clearances and create fire defense zones around power lines.
  • Informed more than 570,000 homes and businesses served by electric lines in extreme-fire threat areas that PG&E may have to shut off power for public safety if extreme fire danger conditions occur, as a last resort.

Beyond a heightened focus on wildfire prevention and response, PG&E is moving forward with initiatives that continue to build California's clean energy future. For example:

  • Requested approval from the California Public Utilities Commission for four energy storage projects, totaling approximately 567 megawatts, including a proposed PG&E-owned 182.5 MW lithium-ion battery energy storage system in Moss Landing, Calif., which would be PG&E's largest utility-owned storage facility.
  • Signed the first community solar project to be included in PG&E's Regional Renewable Choice Program, which allows all customers, including renters and those who can't install solar power, the option of purchasing up to 100 percent local solar energy.
  • Announced a new goal to reduce 1 million tons of greenhouse-gas emissions from company operations through 2022.

Non-GAAP Earnings from Operations

PG&E Corporation's non-GAAP earnings from operations, which exclude items impacting comparability (IIC), were $601 million, or $1.16 per share, in the second quarter of 2018, compared with $440 million, or $0.86 per share, during the same period in 2017.

The increase in quarter-over-quarter non-GAAP earnings from operations was primarily driven by the timing and duration of nuclear refueling outages, the impact of miscellaneous regulatory decisions, probable cost recoveries of insurance premiums incurred in 2018 above amounts included in authorized revenue requirements, and the timing of taxes resulting from the percentage of quarterly earnings to annual earnings.

PG&E Corporation discloses historical financial results based on "non-GAAP earnings from operations," which is a non-GAAP financial measure, in order to provide a measure that allows investors to compare the underlying financial performance of the business from one period to another, exclusive of items impacting comparability. See the accompanying tables for a reconciliation of non-GAAP earnings from operations to consolidated income available for common shareholders.

IIC Guidance

PG&E Corporation is not providing at this time guidance for 2018 GAAP earnings and non-GAAP earnings from operations due to the uncertainty related to the Northern California wildfires. The company is providing 2018 IIC guidance of $1.6 billion to $1.8 billion after-tax for costs related to 14 of the Northern California wildfires, net of insurance, costs related to the Butte fire, net of contractor insurance, costs to clear pipeline rights-of-way, and probable cost recoveries of insurance premiums incurred in 2017 above amounts included in authorized revenue requirements.

IIC guidance is based on various assumptions and forecasts related to future expenses and certain other factors.

Supplemental Financial Information

In addition to the financial information accompanying this release, presentation slides for today's conference call with the financial community have been furnished to the Securities and Exchange Commission (SEC) and are available on PG&E Corporation's website at:

Public Dissemination of Certain Information

PG&E Corporation and Pacific Gas and Electric Company (Utility) routinely provide links to the Utility's principal regulatory proceedings with the California Public Utilities Commission (CPUC) and the Federal Energy Regulatory Commission (FERC) at, under the "Regulatory Filings" tab, so that such filings are available to investors upon filing with the relevant agency. PG&E Corporation and the Utility also routinely post, or provide direct links to, presentations, documents, and other information that may be of interest to investors at, under the "Wildfire Updates" and "News & Events: Events & Presentations" tabs, respectively, in order to publicly disseminate such information. It is possible that any of these filings or information included therein could be deemed to be material information.

Conference Call with the Financial Community to Discuss Financial Results

Today's call at 11:00 a.m. Eastern Time, is open to the public on a listen-only basis via webcast. Please visit for more information and instructions for accessing the webcast. The webcast call and the related materials will be available for replay through the website for at least one year. Alternatively, a toll-free replay of the conference call may be accessed shortly after the live call through August 9, 2018, by dialing (866) 415-9493. International callers may dial (205) 289-3247. For both domestic and international callers, the confirmation code 24691# will be required to access the replay.

About PG&E Corporation

PG&E Corporation (NYSE: PCG) is a Fortune 200 energy-based holding company, headquartered in San Francisco. It is the parent company of Pacific Gas and Electric Company, an energy company that serves 16 million Californians across a 70,000-square-mile service area in Northern and Central California. For more information, visit In this press release, they are together referred to as "PG&E."

Forward-Looking Statements

This press release contains statements regarding current expectations, objectives and assumptions for future periods, including PG&E Corporation's 2018 IIC guidance. These statements and other statements that are not purely historical constitute forward-looking statements that are necessarily subject to various risks and uncertainties. Actual results may differ materially from those described in forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to:

  • the impact of the Northern California wildfires, including whether the Utility will be able to recover any costs for service restoration and repair to the Utility's facilities through its Catastrophic Event Memorandum Account (CEMA); the timing and outcome of the remaining wildfire investigations; the extent to which the Utility will have liability associated with the fires;
  • whether the Utility will be able to recover costs in connection with the Northern California wildfires in excess of insurance through regulatory mechanisms and the timing of such recovery;
  • potential liabilities in connection with fines or penalties that could be imposed on the Utility if the California Public Utilities Commission (CPUC) or any other law enforcement agency brings an enforcement action in connection with the Northern California wildfires and determines that the Utility failed to comply with applicable laws and regulations;
  • the timing and outcome of the Butte fire litigation and of any proceeding to recover costs in excess of insurance through regulatory mechanisms and the timing of such recovery; and whether additional investigations and proceedings in connection with the Butte fire will be opened and any additional fines or penalties imposed on the Utility;
  • whether PG&E Corporation and the Utility are able to successfully challenge the application of the doctrine of inverse condemnation to investor-owned utilities, and the timing and outcome of pending wildfire legislation;
  • the costs of the Utility's insurance and 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 outcome of any CPUC decision related to the Utility's March 30, 2018 submissions in connection with the impact of the Tax Cuts and Jobs Act of 2017 on the Utility's rate cases, and its implementation plan;
  • the timing and outcomes of the 2019 Gas Transmission and Storage (GT&S) rate case, Transmission Owner (TO) 18 and TO19 rate cases, 2018 CEMA, and other ratemaking and regulatory proceedings;
  • the ability of PG&E Corporation and the Utility to access capital markets and other sources of financing in a timely manner on acceptable terms;
  • further credit ratings downgrades that could, among other things, result in higher borrowing costs, fewer financing options, and additional collateral posting, especially if PG&E Corporation's or the Utility's credit ratings were to fall below investment grade;
  • the cost of the Utility's community wildfire safety program, and the timing and outcome of any proceeding to recover such cost through rates;
  • the timing and outcomes of phase two of the ex parte order instituting investigation (OII) and of the safety culture OII;
  • the Utility's ability to efficiently manage capital expenditures and its operating and maintenance expenses within the authorized levels of spending and timely recover its costs through rates, and the extent to which the Utility incurs unrecoverable costs that are higher than the forecasts of such costs;
  • the outcome of the probation and the monitorship, the timing and outcomes of the debarment proceeding, the Safety and Enforcement Division's (SED) 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, and the ultimate amount of fines, penalties, and remedial and other costs that the Utility may incur as a result; and
  • the other factors disclosed in PG&E Corporation and the Utility's joint annual report on Form 10-K for the year ended December 31, 2017, their joint quarterly report on Form 10-Q for the quarter ended March 31, 2018, and other reports filed with the SEC, which are available on PG&E Corporation's website at and on the SEC website at