Slide 1: 2022 Second Quarter Earnings
2022 SECOND QUARTER EARNINGS July 28, 2022
Slide 2: Forward-Looking Statements
® Forward-Looking Statements This presentation contains statements regarding PG&E Corporation’s and Pacific Gas and Electric Company’s (the “Utility”) future performance, including expectations, objectives, and forecasts about operating results (including 2022 non-GAAP core earnings), equity needs,
Slide 3: Delivering Our 2022 Guidance
® Delivering Our 2022 Guidance… NON-GAAP CORE EPS1 Q2 2022 Status RESULTS • Second Quarter - 25¢ • First Half - 55¢ FULL YEAR GUIDANCE 4 • EPS - $1.07 - $1.13 We put surplus • Total New Equity - $0 - $250M On Track performance to work for our customers EPS GROWTH AND deliver on our EPS growth target
Slide 4: 2022: Mitigating Risk
® 2022: Mitigating Risk… Mitigating Physical Risk Mitigating Financial Risk Wildfire Risk Customers • Vegetation Management • Simple and Affordable Model • Inspections and • Improved Service System Hardening • Affordable Rates • EPSS and PSPS Working with California Investors • Exploring Diablo Cany
Slide 5: Layers Of Protection
® Layers Of Protection… 100% Wildfire Mitigation Programs (System Hardening/Undergrounding, Vegetation PG&E Management, Enhanced Inspections and Repairs) actions have80% mitigated Enhanced Powerline Safety Settings (EPSS) 90% 60% Public Safety Power Shutoff of wildfire risk1 40% Situational Awarenes
Slide 6: An Adaptive, Systematic, Risk Mitigation Approach
An Adaptive, Systematic, Risk Mitigation ® Approach… PG&E has continued to adapt to California’s changing wildfire risk profile Wind-driven risk PSPS Fuels/terrain-driven risk EPSS Vegetation Management & System Hardening Wildfire Mitigation Plan Work EPSS and PSPS address a significant portion of t
Slide 7: Simple And Affordable Model
® Simple And Affordable Model… OPPORTUNITIES1 Capital Investment 9% Long-Term Factors: Offset Capital Investments -O&M Cost Reduction (Non-Fuel)2 2% -Electric Load Growth3 1% - 3% -Other (Including Efficient Financing)4 2% Subtotal 5% - 7% Customer Impacts: At or Below Assumed Inflation 2% - 4% Pres
Slide 8: Report Card
® Report Card… Q2 2022 Metric 2022 Goal 2022-2026 Goal Status1 • Annual CPUC Reportable WILDFIRE Ignitions greater than or 0 0 equal to 100 acres2,3 • Undergrounding Circuit 175 3,600 Miles CUSTOMER • Gas Distribution Main 220 1,150 Replacement Miles • Annual O&M Cost 2% 2% Reduction (Non-Fuel)4 • N
Slide 9: Delivering Predictable Outcomes
® Delivering Predictable Outcomes… NON-GAAP CORE EARNINGS1 • Second Quarter EPS - 25¢ Results • First Half EPS - 55¢ • Second Quarter Earnings - $536M Full Year • EPS - $1.07 - $1.13 Guidance • Total New Equity - $0 - $250M Results Ownership • Visibility + Control = Predictability Center Regulatory
Slide 10: Year Over Year Non-GAAP Core EPS Comparison
® Year Over Year Non-GAAP Core EPS Comparison. . . First Half 2022 Results Second Half 2022 Forecast 5¢ Increase 2¢ - 8¢ Increase $1.07 – 2¢-4¢ $1.13 4¢ 4¢ (4¢)-0¢ 3¢ (2¢) $1.00 2021 Full Rate base Cost Regulatory, Rate base Cost Regulatory, 2022 Full Year growth reductions taxes and growth reductio
Slide 11: 2022 Earnings And Equity Guidance
® 2022 Earnings And Equity Guidance. . . Non-GAAP Core EPS1 • $1.07 - $1.13 Reaffirmed Total New • From: $100M - $400M Equity • To: $0 - $250M Lowered Presentation endnotes are included in Appendix 7. …Stronger, With Lower Equity Need 11
Slide 12: Simple And Affordable Model
® Simple And Affordable Model… POSSIBLE EXAMPLES OF MODEL1 O&M COST REDUCTION (NON-FUEL) ANNUAL FUTURE in Millions 2022 Long- Capital Investments 9% Plan Term Plan Long-Term Factors: Offset Good Business Decisions Customer Impacts -Attrition $25 $25 -O&M cost reduction -Contracting 150 50 2% (non-fu
Slide 13: Results Ownership Center
® Results Ownership Center… TRACK PROGRESS MANAGING VARIABILITY ▪ Weekly Operating Reviews ▪ Contracted spending ▪ Visual Management ▪ Productive time ▪ Expense to capital optimization ▪ Internal staffing levels Tracking Performance Recovery Plan Target Sample Metric Current Data "1-3-10" In Action
Slide 14: Regulatory And Legal Highlights
® Regulatory And Legal Highlights… Rate Neutral • Full $7.5B issued Securitization • Improved financial metrics (SB 901) • S&P and Fitch improve outlook • Resolving legacy claims Securities • Recorded probable loss of $145M net of Claims insurance recoveries1 • No resulting increase to equity guidan
Slide 15: Value Proposition
® Value Proposition… 2022-2024 2025-2026 1 Non-GAAP Core EPS (CAGR) 10% Non-GAAP Core EPS Growth At least 10% At least 9% 2 Dividend Eligibility reached mid-2023 Annual Non-GAAP Core EPS At least 10% At least 10% Growth & Dividend Yield 3 Rate Base Growth (CAGR) 9% 4 O&M Cost Reduction (Non-Fuel) 2%
Slide 16: 2022: Mitigating Risk
® 2022: Mitigating Risk… Mitigating Physical Risk Mitigating Financial Risk Wildfire Risk Customers • Vegetation Management • Simple and Affordable Model • Inspections and • Improved Service System Hardening • Affordable Rates • EPSS and PSPS Working with California Investors • Exploring Diablo Cany
Slide 17: Q&A
Q&A
Slide 18: Appendix
[t PG&E Corporation Appendix
Slide 19: Table of Contents
® Table of Contents Appendix 1 2022 Factors Impacting Earnings Slide 20 Appendix 2 CapEx and Rate Base Slide 21 Appendix 3 Expected Recovery of Wildfire Related Costs Slide 22 Appendix 4 Wildfire Mitigation Plan Progress Slide 23 Appendix 5 PG&E Utility Securitization Program Slide 24 Appendix 6 Reg
Slide 20: Appendix 1: 2022 Factors Impacting Earnings
® Appendix 1: 2022 Factors Impacting Earnings Key Ranges Weighted Average Rate Base1 Equity Ratio: 2 52% Return on Equity: 3 10.25% Non-GAAP Core EPS General Rate Case ~$32.9B $1.07 - $1.13 Gas Transmission & Storage ~$6.2B Total New Equity Transmission Owner ~$10.7B $0 - $250M Total Rate Base ~$49.
Slide 21: Appendix 2: CapEx And Rate Base
® Appendix 2: CapEx And Rate Base Weighted average rate base ($B) Potential Growth Opportunities projected ~9% CAGR • Undergrounding on equity rate base 2021-2026 $65-$77 • Additional wildfire mitigation (including remote grid $60-$66 $62-$71 $56-$59 integration) $47.1 ~$49.8 • Transportation electr
Slide 22: Appendix 3: Expected Recovery Of Wildfire-Related Costs
Appendix 3: Expected Recovery Of Wildfire- ® Related Costs $ in Millions Approved Cost Recovery (Final Decisions) Expected Cash Flow Balance at Recovery Expected Rate Recovery by Year Recovery from Application 6/30/22 Through 2022 2023 Previously Incurred 2020 GRC1 719 Dec. 2023 438 281 Wildfire-Rel
Slide 23: Appendix 4: Wildfire Mitigation Plan Progress
® Appendix 4: Wildfire Mitigation Plan Progress1 Sectionalizing Devices Weather Stations 1,347 1,209 1,238 1,313 1,005 899 627 1,238 1,347 Devices 241 Stations Installed Installed 2019 2020 2021 2022 2019 2020 2021 2022 Enhanced Vegetation HD Cameras 7,293 502 549 Management 6,359 4,376 349 7,293 2,
Slide 24: Appendix 5: PG&E Utility Securitization Program
® Appendix 5: PG&E Utility Securitization Program The Utility has completed roughly $8.4B of the $10.7B securitization issuances expected over the next several years Complete Rate Neutral Securitization AB 1054 Securitization Statutory • SB 901 signed into law on September 21, 2018 • AB 1054 signed
Slide 25: Appendix 6: Regulatory Progress
® Appendix 6: Regulatory Progress Status as of Regulatory Case/Filing Docket Expected Milestones1 July 2022 2023 GRC Filed 6/30/21 2023 GRC A.21-06-021 Proposed Decision Expected Q3 2023 Supplemental Testimony Filed 2/25/22 A.17-11-009 2019 Final Decision 2015 GT&S A.20-07-020 GT&S Capital Audit Set
Slide 26: Appendix 7: Presentation Endnotes
® Appendix 7: Presentation Endnotes Slide titles are hyperlinks Slide 3: Delivering Our 2022 Guidance 1. Non-GAAP core EPS is not calculated in accordance with GAAP and excludes non-core items. See Appendix 8, Exhibit A for a reconciliation of EPS on a GAAP basis to non-GAAP core earnings per share
Slide 27: Appendix 7: Presentation Endnotes
® Appendix 7: Presentation Endnotes Slide 10: Year Over Year Non-GAAP Core EPS Comparison Slide titles are hyperlinks 1. Non-GAAP Core EPS for the full year 2021 was $1.00 per share on a fully diluted basis and $1.08 using a basic share count. The impact of dilution was $(0.08) per share. See Append
Slide 28: Appendix 7: Presentation Endnotes
® Appendix 7: Presentation Endnotes Slide titles are hyperlinks Slide 16: 2022 Mitigating Risk 1. Non-GAAP core EPS is not calculated in accordance with GAAP and excludes non-core items. See Appendix 8, Exhibit A for a reconciliation of EPS on a GAAP basis to non-GAAP core earnings per share and App
Slide 29: Appendix 8: Supplemental Earnings Materials
® Appendix 8: Supplemental Earnings Materials Reconciliation of PG&E Corporation's Consolidated Earnings Available for Common Exhibit A: Shareholders in Accordance with Generally Accepted Accounting Principles ("GAAP") to Slides 30-33 Non-GAAP Core Earnings Exhibit B: Key Drivers of PG&E Corporation
Slide 30: Exhibit A: Reconciliation of GAAP to Non-GAAP Core Earnings
® Exhibit A: Reconciliation of PG&E Corporation's Consolidated Earnings Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles ("GAAP") to Non-GAAP Core Earnings Second Quarter, 2022 vs. 2021 (in millions, except per share amounts) Three Months Ended Six Months
Slide 31: Exhibit A: Reconciliation of GAAP to Non-GAAP Core Earnings
® Exhibit A: Reconciliation of PG&E Corporation's Consolidated Earnings Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles ("GAAP") to Non-GAAP Core Earnings Second Quarter, 2022 vs. 2021 (in millions, except per share amounts) (2) Includes bankruptcy and l
Slide 32: Exhibit A: Reconciliation of GAAP to Non-GAAP Core Earnings
® Exhibit A: Reconciliation of PG&E Corporation's Consolidated Earnings Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles ("GAAP") to Non-GAAP Core Earnings Second Quarter, 2022 vs. 2021 (in millions, except per share amounts) (4) The Utility recorded cost
Slide 33: Exhibit A: Reconciliation of GAAP to Non-GAAP Core Earnings
® Exhibit A: Reconciliation of PG&E Corporation's Consolidated Earnings Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles ("GAAP") to Non-GAAP Core Earnings Second Quarter, 2022 vs. 2021 (in millions, except per share amounts) (7) Includes a $63 million ad
Slide 34: Exhibit B: Key Drivers of Non-GAAP Core EPS
® Exhibit B: Key Drivers of PG&E Corporation's Non-GAAP Core Earnings per Common Share ("EPS") Second Quarter, 2022 vs. 2021 (in millions, except per share amounts) Second Quarter 2022 vs. 2021 Year to Date 2022 vs. 2021 Earnings per Earnings per Earnings Common Share Earnings Common Share (Diluted)
Slide 35: Exhibit C: 2022 Earnings Guidance
® Exhibit C: PG&E Corporation's 2022 Earnings Guidance 2022 EPS Guidance Low High Estimated Earnings on a GAAP basis ~ $ 0.74 ~ $ 1.02 Estimated Non-Core Items: (1) Amortization of Wildfire Fund contribution (2) ~ 0.16 ~ 0.16 Bankruptcy and legal costs (3) ~ 0.14 ~ 0.09 Wildfire-related costs, net o
Slide 36: Exhibit C: 2022 Earnings Guidance
® Exhibit C: PG&E Corporation's 2022 Earnings Guidance Exhibit E: PG&E Corporation's 2020 and 2021 Earnings Guidance (3) “Bankruptcy and legal costs" consists of exit financing costs, including interest on temporary Utility debt and write-off of unamortized fees related to the retirement of PG&E Cor
Slide 37: Exhibit C: 2022 Earnings Guidance
® Exhibit C: PG&E Corporation's 2022 Earnings Guidance (5) “Investigation remedies" includes costs related to the 2019 Kincade fire settlement with the Safety and Enforcement Division approved by the CPUC on December 2, 2021, the Wildfires OII decision different, Paradise restoration and rebuild, an
Slide 38: Exhibit C: 2022 Earnings Guidance
® Exhibit C: PG&E Corporation's 2022 Earnings Guidance (7) “Fire Victim Trust tax benefit net of securitization" includes the impact of rate neutral (SB 901) securitization and tax benefits related to the Fire Victim Trust. Impacts of the rate neutral (SB 901) securitization include the establishmen
Slide 39: Exhibit D: General Earnings Sensitivities for 2022
® Exhibit D: General Earnings Sensitivities for 2022 Pacific Gas & Electric Company Variable Description of Change Estimated 2022 Non-GAAP Core Earnings Impact Rate base +/- $100 million change in allowed rate base +/- $5 million Return on Equity (ROE) +/- 0.1% change in allowed ROE +/- $26 million
Slide 40: Exhibit E: GAAP Net Income to Non-GAAP Adjusted EBITDA Reconciliation
® Exhibit E: GAAP Net Income to Non-GAAP Adjusted EBITDA Reconciliation PG&E Corporation Second Quarter, 2022 vs. 2021 Three Months Ended Six Months Ended June 30, June 30, (in millions) 2022 2021 2022 2021 PG&E Corporation’s Net Income on a GAAP basis $ 360 $ 401 $ 838 $ 524 Income tax benefit (328
Slide 41: Exhibit F: Use of Non-GAAP Financial Measures
® Exhibit F: 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 “non-GAAP core earnings” and “non-GAAP core EPS” in order to provide a meas