Pacific Gas & Electric Co. · NYSE:PCG
Pacific Gas & Electric — PG&E — Goldman Sachs 6th Annual Power and Utility Conference 2006
24 slides from Pacific Gas & Electric's conference presentation, May 10, 2006
Slide 1: PG&E Corporation: Customer Focused, Value Driven
PG&E Corporation: Customer Focused, Value Driven Goldman Sachs 6th Annual Power and Utility Conference Las Vegas, NV May 10-12, 2006
Slide 2: Cautionary Statement Regarding Forward-Looking Information
SLIDE 2 Cautionary Statement Regarding Forward-Looking Information This presentation contains forward-looking statements regarding management’s guidance for PG&E Corporation’s 2006 and 2007 earnings per share from operations, capital expenditures, Pacific Gas and Electric Company’s (Utility) rate ba
Slide 3: Strategic Direction
SLIDE 3 Strategic Direction Our vision The leading utility in the United States Our goals Delighted Energized Rewarded customers employees shareholders Our strategies Operational excellence Transformation Our values We act with integrity and communicate honestly and openly. We are passionate about m
Slide 4: Business Priorities 2006-2010
SLIDE 4 Business Priorities 2006-2010 Advance business transformation Provide attractive shareholder returns Increase investment in utility infrastructure Implement an effective energy procurement plan Improve reputation through more effective communications Evaluate the evolving industry and relate
Slide 5: The Virtuous Circle
SLIDE 5 The Virtuous Circle OUR VISION The leading utility in the United States Delighted Customers Satisfied Regulators Rewarded Shareholders
Slide 6: Transformation Phases
SLIDE 6 Transformation Phases Strategy/ Roadmap Preliminary Design & Analysis Detailed Design Build/ Test Implementation & Operational Handover Planned deployment of initiatives: 2005: 20 initiatives were fully or partial deployed 2006: 33 other initiatives will be fully or partially deployed
Slide 7: Transformation Enhancing Performance - Examples
SLIDE 7 Transformation Enhancing Performance - Examples Today (Manual) Outage Management Customer notifies the utility of a problem Troubleman assesses scope of outage Customized construction information prepared New Residential Service Developer completes paper application for new service Multiple
Slide 8: Anticipated Transformation Net Costs and Benefits
SLIDE 8 Anticipated Transformation Net Costs and Benefits Expense ($mm) 2006 2007 2008 2009 2010 Net Cost Range 86 115 6 Net Benefit Range -18 -137 -141 -142
Slide 9: Operational Performance Metrics
SLIDE 9 Operational Performance Metrics 2005 EOY Actual 2006 YTD Actual 2006 YTD Target 2006 EOY Target Overall customer satisfaction (composite of J. D. Power residential and business customer surveys) 94.0 94.5 94.0 96.0 Timely bills (% billed within 35 days) 99.38% 99.53% 99.53% 99.51% Estimate o
Slide 10: 2007 GRC
SLIDE 10 2007 GRC Utility requests $433 million revenue requirement (RRQ) increase over the projected authorized 2006 base RRQ. Intervenor Testimony Filed Division of Ratepayer Advocates (DRA) request is approximately $450 M below PG&E’s request. The Utility Reform Network (TURN) request is being an
Slide 11: Capital Expenditure Outlook
SLIDE 11 Capital Expenditure Outlook Capital expenditures average $2.5B per year for years 2006-2010: 2006 2007 2008 2009 2010 Cap Ex 2.5 2.8 2.6 2.4 2.2 Includes capital expenditure estimates for Contra Costa 8, Diablo Canyon Steam Generator Replacement Project, Humboldt Bay Power Plant, and PG&E S
Slide 12: Rate Base Growth
SLIDE 12 Rate Base Growth 2006 2007 2008 2009 2010 Average Annual Rate Base ($B)* 15.9 17.4 18.6 19.9 20.7 * 2006-2010 rate base is not adjusted for the impact of the carrying cost credit that primarily results from the second series of the Energy Recovery Bonds. Earnings will be reduced by an amoun
Slide 13: Potential Additional Capital Expenditures
SLIDE 13 Potential Additional Capital Expenditures Potential additional capital expenditures related to the following possible projects are not included in the capital expenditure projections: 657 MW utility-owned generation submitted to the CPUC for approval as part of the Long-Term procurement pla
Slide 14: Executed Agreements Pursuant to Long-Term RFO
SLIDE 14 Executed Agreements Pursuant to Long-Term RFO Counterparty/ Facility Size(MW) Contract Type Operational Date Plant Type Term Long-Term Need: Calpine Hayward 601 Power Purchase Agmt 2010 Combined cycle 10 EIF Firebaugh 399 Power Purchase Agmt 2009 Combustion turbine 20 EIF Fresno 196 Power P
Slide 15: EPS Guidance
SLIDE 15 EPS Guidance EPS from Operations*: 2006 guidance of $2.40-$2.50 per share 2007 guidance of $2.65-$2.75 per share 2005A 2006E 2007E Low 2.4 2.65 Guidance Range 0.1 0.1 Actual 2.34 Operating EPS Assumptions ($MM) 2006 2007 Rate Base $15,900 $17,400 Equity Ratio 52% 52% Authorized ROE 11.35% 1
Slide 16: EPS Growth
SLIDE 16 EPS Growth EPS from operations growth targeted to average approximately 7.5% annually 2006-2010 Places us near the top of comparable companies Actual growth rate will depend on infrastructure investments Five-Year Estimated Earnings Growth PCG AEE AEP CNP ED ETR FPL NI PNW PGN SO TE XEL Ear
Slide 17: Appendix
SLIDE 17 Appendix
Slide 18: 2005 EPS - Reg G Reconciliation
SLIDE 18 2005 EPS - Reg G Reconciliation 2005 EPS on an Earnings from Operations Basis $2.34 Items Impacting Comparability: Incremental interest costs related to generator disputed claims from Chapter 11 proceedings (0.01) Prior year’s portion of the gain associated with AEAP settlement 0.24 Costs o
Slide 19: EPS Guidance - Reg G Reconciliation
SLIDE 19 EPS Guidance - Reg G Reconciliation 2006 Low High EPS Guidance on an Earnings from Operations Basis* $2.40 $2.50 Estimated Items Impacting Comparability 0.00 0.00 EPS Guidance on a GAAP Basis $2.40 $2.50 2007 Low High EPS Guidance on an Earnings from Operations Basis* $2.65 $2.75 Estimated
Slide 20: Cost of Operations - Reg G Reconciliation
SLIDE 20 Cost of Operations - Reg G Reconciliation The reconciliation of non-GAAP cost of operations to Operating and Maintenance Expense is: 2005 2006 2006 2006 EOY Actual YTD Actual YTD Target EOY Target External GAAP Operating and Maintenance Expense $3,399 $862 $871 $3,552 Public Purpose and Oth
Slide 21: Definitions of Operational Performance Metrics
SLIDE 21 Definitions of Operational Performance Metrics Overall Customer Satisfaction. PG&E measures residential and business customer satisfaction with annual industry wide surveys conducted by J.D. Power and Associates, as well as with proprietary studies using the same survey in intervening quart
Slide 22: Definitions of Operational Performance Metrics (continued)
SLIDE 22 Definitions of Operational Performance Metrics (continued) Telephone Service Level. Measures the percent of customer calls that have been either (1) completed by automated voice response systems for self-service, or (2) answered in 20 seconds or less by customer service representatives. Tot
Slide 23: Key Pending Regulatory Proceedings
SLIDE 23 Key Pending Regulatory Proceedings Pending approval Completion of CC8 Decision expected Q2 2006 Advanced Metering Infrastructure Decision expected 7/06 2007 GRC Decision expected 12/06 Electric Transmission Owner 8 Settlement Decision expected Q3 2006 Generation LT RFO & Humboldt Bay PP Dec
Slide 24: Expected 2007 GRC Timeline
SLIDE 24 Expected 2007 GRC Timeline File Application Filed on December 2, 2005 Prehearing Conference Held on January 23, 2006 Intervenor testimony April 28 Evidentiary hearings May 31 - July 7 Briefs and reply briefs July 27 - August 10 ALJ proposed decision November 14 Final commission order Decemb
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