Pacific Gas & Electric Co. · NYSE:PCG
Pacific Gas & Electric — PG&E — Lehman Brothers CEO Energy / Power Conference 2007
23 slides from Pacific Gas & Electric's conference presentation, Sep 5, 2007
Slide 1: Strong Core Growth and Future Demand-side Earnings
PG&E Corporation: Exhibit 99.1 S trong Core Growth and Future Demand-side Earnings Christopher P. Johns, CFO Lehman Brothers CEO Energy / Power Conference September 4 - 6, 2007 New York, NY
Slide 2: Forward-looking statements
This presentation contains forward-looking statements regarding management’s guidance for PG&E Corporation’s 2007 and 2008 earnings per share from operations, targeted average annual growth rate for earnings per share from operations, as well as management’s projections regarding Pacific Gas and Ele
Slide 3: Key Takeaways From Today's Discussion
Key Takeaways From Today’s Discussion PCG is a core utility holding delivering 1 st quartile earnings growth at low risk. Pre-approved rate base infrastructure investment supports strong earnings growth. Energy efficiency and demand response / AMI present additional upside.
Slide 4: Agenda For Today
Agenda For Today PG&E core investment and earnings outlook Demand-side earnings opportunities - Energy Efficiency Incentives - AMI Upgrades
Slide 5: Capital Expenditures Drive Core Growth
Investment Driver Cap Ex Example Projects Electric Generation Resources ~$1.3 Billion Gateway Generation Station Humboldt Colusa Electric and Gas Delivery System ~$7 Billion Distribution Maintenance and Upgrades McDonald Island Gas Storage Pipeline New Customer Connections AMI Electric Transmission
Slide 6: EPS from Operations Guidance
*Reg G reconciliation to GAAP for 2006 EPS from Operations and 2007 and 2008 EPS Guidance available in Appendix and at www.pge-corp.com EPS from Operations* EPS Guidance EPS from Operations*: 2007 guidance of $2.70-$2.80 per share 2008 guidance of $2.90-$3.00 per share 8%
Slide 7: Earnings Upsides Not in Guidance
Earnings Upsides Not in Guidance Additional transmission and generation investments Energy efficiency incentives AMI upgrades and related products and services
Slide 8: Additional Transmission and Generation Investments
Additional Transmission and Generation Investments Proposed Pacific Connector Gas Pipeline (PCGP) 1.0 -1.5 Bcf/d, 230 mile LNG pipeline $1.1 B (33% PG&E share) 2006 Long Term Procurement Plan 2,300 MW proposed post-2011 Proposed BC Wind Transmission $14 M approved to study options Coordina
Slide 9: CPUC Proposed Energy Efficiency Incentives
*All amounts are pre-tax and cumulative for the three-year cycle EE Incentive Final Decision PG&E Report of EE 2006 - 2007 Results (Feb) Energy Division Verification of 2006-2007 EE Results (Aug) Advice letter filing for 70% payment (Sep) 2006-2007 Incentive awarded (Nov/Dec) PG&E Report of EE 2008
Slide 10: EE is California's least-cost resource
Source: California Energy Commission EE is California’s least-cost resource - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 kWh US CA Western Europe Per Capita Energy Usage - California, US and Europe Resource Type Ave Cost (kWh)* Energy Efficiency $.025 Diablo Canyon $.039 Utility, Irrigation Distri
Slide 11: PG&E's 2006-2008 EE goals
Note: 2007 and 2008 are PG&E targets. CPUC target is 2,826 GWh for 2006-2008. PG&E’s 2006-2008 EE goals: 3,063 GWh; 47 MM therms Programs extend into 2009-2011 Energy Efficiency Savings: Achieved and Target PG&E’s Energy Efficiency Programs
Slide 12: Energy Efficiency Target Markets and Initiatives
Market Example Initiatives High Tech Data Center Efficiency Residential New Construction New Solar Homes Partnership Agricultural & Food Processing Bio-Energy Recovery Systems Schools & Colleges University Research Center Efficiency Large Commercial “More-than-a-Million” Retro-commissioning Program
Slide 13: Demand Response Programs
MWs Demand response impacts expected to double from 2007 Actual and Projected Capacity Savings from Demand Response Programs Demand Response Programs
Slide 14: SmartMeter Program Upgrade Timeline
2008 and beyond July 2007: RFP Issued Q4 2007 - Q2 2008: Field Testing Aug 2007: Bids Submitted *SmartMeter Program Upgrade subject to results of bid evaluation, successful field testing, and obtaining any necessary CPUC approval . SmartMeter is a trademark of SmartSynch, Inc. and is used by permiss
Slide 15: Smart Energy Web
Today Near Term Future Load Control In-home display Real-time price negotiation Distributed storage and generation 20?? Smart Energy Web
Slide 16: PCG Investment Opportunity Summary
PCG Investment Opportunity Summary First quartile EPS growth at low risk Approved infrastructure investment Potential upsides not in guidance Additional transmission and generation investment Energy efficiency incentives AMI related products and services
Slide 17: Conference Notes
Conference Notes
Slide 18: Appendix
18 Appendix Lehman Brothers CEO Energy / Power Conference September 4 - 6, 2007 New York, NY
Slide 19: PG&E Vision
We act with integrity and communicate honestly and openly. We are passionate about meeting our customers’ needs and delivering for our shareholders. We are accountable for all of our own actions: these include safety, protecting the environment, and supporting our communities. We work together as a
Slide 20: Rating Agency Outlook
Rating Agency Outlook Current Ratings Utility issuer rating: BBB+ (1) / Baa1 (2) Utility unsecured debt: BBB+ (1) / Baa1 (2) Utility short-term rating: A2 / P2 Average Utility Metrics (2007-2011) (3) S&P Business Profile Rating: 5 Total Debt to Capitalization (EOY): 53.6% Funds from Oper
Slide 21: Survey of analyst estimates of EPS growth
Survey of analyst estimates of EPS growth: Source: Thomson IBIS long-term EPS Growth Consensus Estimate Median August 23, 2007 EPS Growth - Comparator Group EPS from operations annual growth targeted to average 8% for 2007 - 2011
Slide 22: 2006 EPS - Reg G Reconciliation
* Earnings per share from operations is a non-GAAP measure. This non-GAAP measure is used because it allows investors to compare the core underlying financial performance from one period to another, exclusive of items that do not reflect the normal course of operations. 2006 EPS - Reg G Reconciliati
Slide 23: EPS Guidance - Reg G Reconciliation
EPS Guidance - Reg G Reconciliation Low High EPS Guidance on an Earnings from Operations Basis* $2.70 $2.80 Estimated Items Impacting Comparability 0.00 0.00 EPS Guidance on a GAAP Basis $2.70 $2.80 Low High EPS Guidance on an Earnings from Operations Basis* $2.90 $3.00 Estimated Items Impacting Com
PG&E — Lehman Brothers CEO Energy / Power Conference 2007 on 6ix