Slide 1: First Quarter Earnings Call
FIRST QUARTER EARNINGS CALL May 3, 2018
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains statements regarding management’s expectations and objectives for future periods as well as forecasts and estimates regarding 2018 IIC guidance, Tax Cuts and Jobs Act expected impact, 2017-2019 capital expenditures, 2017-2019 weighted average rat
Slide 3: Northern California Wildfires Response
Northern California Wildfires Response Updating compliance requirements in high-risk wildfire Regulatory zones Engaged in multiple forums to challenge the application Legal of inverse condemnation Advocating to address impacts of climate change and Legislative the need for comprehensive solutions Ex
Slide 4: Legal Update
Legal Update Status Update Next Steps • 5/1/2018: Trial court denied • May 2018: PG&E to seek PG&E’s motion to renew appellate review of trial court Butte Fire inverse condemnation challenge decision Case • ~3,800 individual plaintiffs as of • Appellate process is 1 – 2 years 4/30/2018 • 3/16/2018:
Slide 5: Community Wildfire Safety Program Overview
Community Wildfire Safety Program Overview Bolstering wildfire Working with our Longer term, hardening prevention and emergency communities on new and our electric system and response enhanced safety measures integrating new technologies • Established a Wildfire • Executing more • Investing in stron
Slide 6: Q1 2018 Earnings Results
Q1 2018 Earnings Results Earnings EPS (millions) Earnings on a GAAP basis $ 442 $ 0.86 Items Impacting Comparability Northern California wildfire-related costs 15 0.03 Pipeline-related expenses 7 0.01 Butte fire-related costs, net of insurance 4 0.01 Earnings from Operations $ 468 $ 0.91 Items Impac
Slide 7: Q1 2018: Quarter over Quarter Comparison
Q1 2018: Quarter over Quarter Comparison Earnings per Share from Operations $1.40 $1.20 $0.03 ($0.08) $0.08 ($0.06) ($0.05) $1.00 ($0.01) ($0.01) ($0.05) $0.80 $0.60 $1.06 $0.91 $0.40 $0.20 $0.00 Q1 2017 EPS Growth in Rate Timing of 2017 Tax Impact of Timing of Timing of Taxes Decrease in Increase i
Slide 8: 2018 Assumptions
2018 Assumptions Capital Expenditures Authorized Ratebase (weighted average) ($ millions) ($ billions) 2018 2018 General Rate Case 3,900 General Rate Case 25.9 Gas Transmission and Storage 1,000 Gas Transmission and Storage 3.8 Transmission Owner 19 1,400 Transmission Owner 7.1 Total Cap Ex $6.3 bil
Slide 9: 2018 Items Impacting Comparability Guidance
2018 Items Impacting Comparability Guidance ($ millions, pre-tax) Pipeline-related expenses (1) 35 - 60 Butte fire-related costs, net of insurance (2) 30 - 60 Northern California wildfire-related costs, net of insurance (3) 35 - 50 Estimated 2018 Items Impacting Comparability Guidance Total $100 - 1
Slide 10: Tax Cuts and Jobs Act Expected Impact
Tax Cuts and Jobs Act Expected Impact Lower Customer Bills Annual reduction in customer revenue driven ~$450M by lower corporate tax rate annual revenue reduction Cash Tax Payments Faster net operating loss amortization and 2020 ~1 year acceleration of federal tax payments estimated year federal tax
Slide 11: Robust Cap Ex Supports Strong Returns
Robust Cap Ex Supports Strong Returns Capital Expenditures ($ in B) 2017-2019 $6.3B ~$6B $5.8B 2017 Recorded 2018 2019 General Rate Case Gas Transmission & Storage Electric Transmission Owner Range See the Forward Looking Statements for factors that could cause actual results to differ materially fr
Slide 12: Ratebase Supports Strong Returns
Ratebase Supports Strong Returns 2017-2019 Weighted Average Ratebase ($ in B) (1) ~7.5 - 8% CAGR $36.8B ~$40B $34.4B 2017 2018 2019 General Rate Case Gas Transmission & Storage Electric Transmission Owner Range Base Case Assumptions Potential Future Updates 2018 2019 • 2019 Gas Transmission & Storag
Slide 13: Equity Needs and Sources
Equity Needs and Sources Needs Sources Previous Guidance (Internal Programs) Internal Programs (Excluding DRP (1)) + Tax Reform + Cash from Dividend Suspension + Items Impacting Comparability March 31, 2018 shares outstanding: ~516 million (1) Dividend Reinvestment Plan. See the Forward Looking Stat
Slide 14: Appendix
[t PG&E Corporation Appendix
Slide 15: Appendix – Incremental Equity Factors
Appendix 1 – Incremental Equity Factors Incremental Equity Factors for Unrecovered Costs Equity Impacting Event Multiplier Non-deductible cash charges 100% Cash expenses 72% Non-cash charges (1) 36% (1) Multiplier applies at time of accrual; additional 36% applies at time of cash charge. 15
Slide 16: Appendix – Supplemental Earnings Materials
Appendix 2 – Supplemental Earnings Materials Exhibit A: Reconciliation of PG&E Corporation’s Consolidated Income Available Slide 17 for Common Shareholders in Accordance with Generally Accepted Accounting Principles to Earnings from Operations Exhibit B: Key Drivers of PG&E Corporation’s Earnings pe
Slide 17: Reconciliation of Earnings to Operations
Exhibit A: Reconciliation of PG&E Corporation’s Consolidated Income Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles (“GAAP”) to Earnings from Operations First Quarter, 2018 vs. 2017 Three Months Ended March 31, (in millions, except per share amounts) Ear
Slide 18: Key Drivers of EPS from Operations
Exhibit B: Key Drivers of PG&E Corporation’s Earnings per Common Share (“EPS”) from Operations First Quarter, 2018 vs. 2017 Three Months Ended (in millions, except per share amounts) March 31, 2018 Earnings per Common Share Earnings (Diluted) 2017 Earnings from Operations (1) $ 544 $ 1.06 Growth in
Slide 19: Operational Performance Metrics
Exhibit C: Operational Performance Metrics 2018 Q1 2018 Performance Results 2018 Target Meets Target (1) Actual Safety (includes both public and employee safety metrics) Nuclear Operations Diablo Canyon Power Plant (DCPP) Reliability and Safety DCPP Unit 1 Score 96.9 96.4 P DCPP Unit 2 Score 89.9 87
Slide 20: Definitions of Operational Performance Metrics
Definitions of 2018 Operational Performance Metrics from Exhibit C Safety Public and employee safety are measured in four areas: Nuclear Operations Safety, Electric Operations Safety, Gas Operations Safety, and Employee Safety. The safety of the Utility’s nuclear power operations, DCPP Unit 1 and Un
Slide 21: Sales and Sources Summary
Exhibit D: Pacific Gas and Electric Company Sales and Sources Summary First Quarter, 2018 vs. 2017 Three Months Ended March 31, 2018 2017 Sales from Energy Deliveries (in millions kWh) 18,820 19,538 Total Electric Customers at March 31 5,409,768 5,374,780 Total Gas Sales (in Bcf) 232 227 Total Gas C
Slide 22: Items Impacting Comparability Guidance
Exhibit E: PG&E Corporation’s 2018 Items Impacting Comparability (“IIC”) Guidance 2018 IIC Guidance (in millions, after-tax) Low High Estimated Items Impacting Comparability: (1) Pipeline-related expenses (2) $ 43 $ 25 Butte fire-related costs, net of insurance (3) 43 22 Northern California wildfire
Slide 23: 2018 General Earnings Sensitivities
Exhibit F: 2018 General Earnings Sensitivities PG&E Corporation and Pacific Gas and Electric Company Variable Description of Change Estimated 2018 Earnings Impact Rate base +/- $100 million change in allowed rate base +/- $5 million Return on equity (ROE) +/- 0.1% change in allowed ROE +/- $19 milli
Slide 24: Use of Non-GAAP Financial Measures
Exhibit G: Use of Non-GAAP Financial Measures PG&E Corporation and Pacific Gas and Electric Company: Use of Non-GAAP Financial Measures PG&E Corporation discloses historical financial results and provides guidance based on “earnings from operations” in order to provide a measure that allows investor
Slide 25: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates 2017 General Rate Case (Phase I) A. 15-09-001 Sep 1, 2015 – Application Filed Oct 29, 2015 – Prehearing conference Jan 22, 2016 – PG&E Supplemental Testimony on gas distribu
Slide 26: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Safety Culture and Governance Order I.15-08-019 Sep 2, 2015 – OII issued Instituting Investigation Oct 30, 2015 – PG&E submits discovery responses to SED Dec 15, 2015 – PG&E
Slide 27: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates 2015 Electric Distribution Resources Plan A.15-07-006, Jan 26, 2016 – Pre-LNBA Workshop Comments Filed (DRP) (Cont.) R.14-08-013 Jan 27, 2016 – ACR/ALJ Ruling issuing Scope
Slide 28: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Catastrophic Event Memorandum Account A. 16-10-019 Oct 31, 2016 – Application filed and testimony served (CEMA) 2016 Dec 5, 2016 – Protests or responses Dec 12, 2016 – Reply
Slide 29: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Integration of Distributed Energy R.14-10-003 Sep 22, 2015 – Decision to expand scope to include distributed energy resources (DERs) on system side of customer's meter Resou
Slide 30: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Ex Parte Order Instituting Investigation and I.15-11-015 Nov 23, 2015 – OII issued Order to Show Cause Dec 3, 2015 – City of San Bruno, City of San Carlos and TURN comments