Slide 1: Fixed-Income Presentation
PG&E Corporation Exhibit99.2 Pacific Gas and Electric Company Fixed-Income Presentation Christopher P. Johns, CFO, PG&E Corporation September 7, 2007 New York, NY
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information 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 wel
Slide 3: Business
Business Unit Rate Base ($B) Regulation Electric and gas distribution $10.3 CPUC Electric generation $1.8 CPUC Gas transmission $1.5 CPUC Electric transmission $2.3 FERC PCG Total Business $15.9 85% CPUC/15% FERC Pacific Gas and Electric Company (PG&E) • $12.5 B in Revenues • $34.8 B in Assets • 5.1
Slide 4: 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 5: Our Business Strategy
Our Business Strategy • Competitive customer focus • Operational excellence • Regulatory alignment • Environmental leadership • Community involvement
Slide 6: Regulated Business Drivers
Regulated Business Drivers • Statewide Energy Strategy California Energy Action Plan Renewable Portfolio Standard AB32 Greenhouse Gas Legislation • Constructive Regulatory Environment Decoupling/Balancing Account Treatment Purchased Power and Fuel Costs Pass-Through Pre-Approved CapEx
Slide 7: 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 ~$7 Billion • Distribution Maintenance and Upgrades • McDonald Island Gas Storage Pipeline • New Customer Connections • AMI Electric
Slide 8: Capital Expenditure Outlook
Common Plant Electric Trans. Generation Capital Expenditures ($MM) Gas Trans. Distribution Chart Key $1,000 $2,000 $3,000 $3,200 $3,200 $2,500 $3,100 $2,200 Capital Expenditure Outlook
Slide 9: Rate Base Growth
* Projected 2007-2011 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 amount equal to the deferred tax balance associated with the Energy Recovery Bonds regulatory asset, m
Slide 10: EPS 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 11: California Energy Policy
California Energy Policy PG&E’s resource investment strategy is aligned with California’s Energy Action Plan “ preferred loading order”: 1. Energy Efficiency 2. Demand Response 3. Renewable Resources 4. Distributed Generation 5. Conventional Resources
Slide 12: California's Success With Energy Efficiency
Over the past 30 years, California per capita energy use has remained relatively flat compared to the 50% increase in U.S. per capita energy use. Source: California Energy Commission California’s Success With Energy Efficiency - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 US CA Western Europe
Slide 13: Changing Legislative Environment for GHG
Changing Legislative Environment for GHG Recent greenhouse gas legislation: • California global warming legislation enacted in 2006 • Federal legislation expected in 2 to 4 years PG&E supports: • Mandatory market-based approach • Encouraging early action toward goals before full regulatory implement
Slide 14: Relative CO2 Emissions Rates - Generation
* Comparison companies selected by Innovest. Data include emissions of regulated and unregulated plants. 2004 is the most recent data available. 2004 CO 2 Emissions and Emission Rates* Source: Innovest Relative CO 2 Emissions Rates - Generation
Slide 15: Industry Leadership and Emerging Growth
Industry Leadership and Emerging Growth PG&E is looking ahead to the future of utility services • Clean/renewable fuel technologies • Smart Energy Web • Plug-in anywhere technologies • Sustainable Energy Communities
Slide 16: 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
Slide 17: Recent and Projected Financing Activity
Recent and Projected Financing Activity 2007: • Utility issued $700 million senior unsecured bonds due 2037 in March • Utility bank revolver extended to 2012 and upsized by $650 million to $2 billion (replaced asset-backed CP program) • Extended $200 million Holding Company bank revolver to 2012 Pro
Slide 18: Liquidity Profile
(1) The amounts shown for borrowings outstanding, commercial paper outstanding, and cash have fluctuated since June 30, 2007 in light of recent changes in the credit and commercial paper markets, although the current overall liquidity remains consistent with the June 30, 2007 level. (2) Borrowing ca
Slide 19: Appendix
19 Appendix September 7, 2007 New York, NY
Slide 20: Long-Term Debt Portfolio
Issue Size (MM) Coupon Issue Date Maturity Date Tax Status Senior Note $600 3.60% 3/23/2004 3/01/2009 Taxable Senior Note $500 4.20% 3/23/2004 3/01/2011 Taxable Senior Note $1,000 4.80% 3/23/2004 3/01/2014 Taxable Senior Note $3,000 6.05% 3/23/2004 3/01/2034 Taxable Senior Note $700 5.80% 3/13/2007
Slide 21: PG&E Corporation Long-Term Debt Portfolio
Issue Size (MM) Coupon Issue Date Maturity Date Conversion Price Shares Convertible Subordinated Note $280 9.50% 06/25/2002 06/30/2010 $15.0873 18,558,059 • The convertible notes can be converted into PG&E Corporation common shares at the conversion price of $15.0873 per share at any time prior to t
Slide 22: Long-Term Debt Maturity Schedule
Long-Term Debt Maturity Schedule
Slide 23: Debt Profile
(1) PG&E Corporation and Pacific Gas and Electric Company (2) Fixed-floating mix is 80.1% / 19.9% if $577 million of commercial paper outstanding on June 30, 2007 is included. Debt Profile (1)
Slide 24: Ratemaking Summary
Ratemaking = Projected Test Year w/ Attrition adjustments Rate Base = Net Plant (in service) - deferred taxes from accelerated depreciation +/- net working capital (may exclude many balance sheet assets or liabilities) Balancing Accounts = • Cost of procuring energy • Sales volume • Selected other e
Slide 25: Renewable Resource Procurement
* 2008 to 2011 estimates are based on forecasted construction schedules and additional contracted resources Projected Deliveries Plus Contracts* 2006 deliveries comprised of: Renewable Portfolio Standard target is 20% by 2010 Renewable Resource Procurement
Slide 26: New Generation Resources: Utility-Owned & Conventional Power Purchase Agreements
Facility Size (MW) Status Target Operational Date Gateway broken ground Humboldt Bay permitting Colusa permitting Total 1,350 PPAs Counterparty/Facility Size (MW) Target Operational Date Contract Term (years) Calpine Hayward EIF Firebaugh Starwood Firebaugh EIF Fresno Tierra Energy Hayward Total 1,4
Slide 27: Long-Term Electric Resources
*Over 20% of total retail sales expected to be eligible renewable resources coming from utility-owned, QFs, Irrigation Districts, and other sources. ** May include utility-owned resources. * Approximately 13% of total retail sales expected to be eligible renewable resources coming from utility-owned
Slide 28: 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 29: 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