Pacific Gas & Electric Co. · NYSE:PCG
Pacific Gas & Electric — PG&E — Non-Deal Roadshow (July 2009)
30 slides from Pacific Gas & Electric's roadshow presentation, Jul 2, 2009
Slide 1: PG&E Corporation European Investor Meetings
PG&E Corporation European Investor Meetings June 25 – July 2, 2009
Slide 2: PCG Investment Case
PCG Investment Case • PCG is focused on better service to our customers, which is the foundation of our growth: • Substantial Cap Ex Program • Manageable financing requirements • Decoupled revenues • Pass-through of procurement costs • 11.45% weighted ROE on 52% equity • Low carbon footprint 2
Slide 3: Pacific Gas and Electric Company (PG&E)
Pacific Gas and Electric Company (PG&E) • Provides energy to nearly 1 in 20 people in the U.S. • 70,000 square-mile service territory • Four main operational units: Electric and gas distribution Electric transmission Gas transmission Electric generation PG&E SERVICE AREA IN CALIFORNIA • $18.2 billio
Slide 4: Electric And Gas Distribution
Electric And Gas Distribution Business Scope • Retail electricity and natural gas distribution service (construction, operations and maintenance) • Customer services (call centers, meter reading, billing) • 5.1 million electric and 4.3 million gas customer accounts Primary Assets • $11.9 billion of
Slide 5: Electric Transmission
Electric Transmission Business Scope • Wholesale electric transmission services (construction, maintenance) • Operation by CA Independent System Operator Primary Assets • $2.8 billion of rate base (2008 wtd. avg.) Regulation • Federal regulation (FERC) Malin Round Mt • Cost of service ratemaking • R
Slide 6: Natural Gas Transmission
Natural Gas Transmission Business Scope • Natural gas transportation, storage, parking and lending services • Customers: PG&E natural gas distribution and electric generation businesses, industrial customers, California electric generators Primary Assets • $1.5 billion of rate base (2008 wtd. avg.)
Slide 7: Electric Generation
Electric Generation Business Scope • Electricity and ancillary services from owned and controlled resources • Energy procurement program Primary Assets • $2.0 billion of rate base (2008 wtd. avg.) • Diablo Canyon Nuclear Power Plant (2,240 MW) • Gateway Generating Station (530 MW) • Largest privatel
Slide 8: Vision and Values
Vision and Values OUR VISION The leading utility in the United States OUR GOALS Delighted Customers Energized Employees Rewarded Shareholders Environmental Leadership OUR STRATEGIES Customer Focus Operational Excellence • W e act with integrity and communicate honestly OUR VALUES and openly • W e ar
Slide 9: 2009 Business Priorities
2009 Business Priorities • Drive customer satisfaction • Deliver on budget, on plan, and on purpose • Improve reliability • Improve safety and human performance • Champion effective regulatory and legislative policies 9
Slide 10: PG&E Financial Strategy
PG&E Financial Strategy • Achieve solid, sustained EPS growth • Actively manage cash flow • Maintain opportunistic financing approach 10
Slide 11: Capital Expenditure Outlook
Capital Expenditure Outlook CapEx Outlook $B 5.0 High 4.5 4.0 $3.7B High High 3.5 Low Low Low 3.0 2.5 2.0 Actual 2008 2009 2010 2011 Low Case $3.6B Low Case $3.4B Low Case $3.3B High Case $3.7B High Case $3.8B High Case $4.8B 11
Slide 12: Rate Base Growth
Rate Base Growth $B Weighted Average Annual Rate Base* 28.0 26.0 High Low 24.0 High 22.0 Low High 20.0 Low $18.2B 18.0 16.0 Actual 2008 2009 2010 2011 Low Case $20.1B Low Case $22.1B Low Case $24.3B High Case $20.3B High Case $22.4B High Case $25.4B * Actual 2008 and projected 2009-2011 rate base is
Slide 13: Residential Electric Bills
Residential Electric Bills Residential Average Monthly Bills by Region(1) $175 $153.85 $150 $134.45 $125 $107.80 $108.86 $114.30 $96.45 $97.99 $100 $80.64 $82.86 $83.12 $86.41 $76.07 $75 $50 $25 $0 IA, KS, IL, IN, MI, PG&E AZ, CO, CA, OR, NJ, NY, USA AL, KY, CT, ME, DE, DC, AR, LA, AK, HI MN, MO, OH
Slide 14: EPS Guidance
EPS Guidance Earnings per Share from Operations High $3.85 High $3.50 Low $3.65 $3.35 Low High $3.25 $3.15 Low $2.95 $2.78 2008 2009 2010 2011 Actual * Reg G reconciliation to GAAP for 2008 EPS from Operations, and 2009-2011 EPS Guidance available in Appendix and at www.pge-corp.com/investors 14
Slide 15: Additional Capital Opportunities
Additional Capital Opportunities Generation • Additional renewable generation investment opportunities • Prior RFO Shortfalls Electric Transmission & Gas Pipelines • Additional transmission to reach renewable generation • B.C. Transmission Line • Pacific Connector Gas Pipeline 15
Slide 16: Financial Assumptions 2009-2011
Financial Assumptions 2009-2011 GUIDANCE REFLECTS: • Capital expenditures consistent with low and high case ranges • CPUC authorized ROE of at least 11.35% and Utility earns at least 12% on FERC projected rate base • Ratemaking capital structure maintained at 52% equity • CEE incentives, operational
Slide 17: Dividend Policy
Dividend Policy • Sustainable, comparable dividend • Payout ratio range of 50% - 70% • Dividend growth in line with EPS growth. Historical Quarterly Dividends per Share $0.45 $0.42 $0.39 $0.40 $0.36 $0.35 $0.33 $0.30 $0.30 $0.25 04/05 - 10/05 01/06 - 01/07 04/07 - 01/08 04/08 - 1/09 04/09 17
Slide 18: Investment in Infrastructure
Investment in Infrastructure • Infrastructure spend categories: • Substations • Poles and Maintenance • New Customer Connects • Capacity and Reliability • Transmission spend categories • System Expansion / Congestion Relief • Maintenance and Replacement • Automation Technology Expansion • New Genera
Slide 19: SmartMeter Installations
SmartMeterTM Installations 4.5 million 1.7 million Cumulative Meters Installed 273,000 1,656 2006 2007 2008 2009 PLAN 19
Slide 20: New Generation Investment
New Generation Investment Humboldt Bay Power Plant * Colusa Generating Station * * Humboldt Bay is a 163 MW plant currently under construction. Projected Cost: $239M, scheduled completion 2010. * Colusa is a 657 MW plant currently under construction. Projected Cost: $673M, scheduled completion 2010.
Slide 21: PG&E Ownership of Renewables
PG&E Ownership of Renewables Proposed Solar PV Program • Up to 250 MW of Utility-owned PV generation • Up to 250 MW of standard-offer PV PPAs 21
Slide 22: RPS Strategy
RPS Strategy • Expect 14% deliveries from renewable resources in 2009 • Contracted/Current deliveries represent over 20% of projected load for 2013 • Utility Owned PV is a contributor to achieving RPS goals 22
Slide 23: PCG: Outlook for the Future
PCG: Outlook for the Future Leading renewable and energy efficiency programs… … and limiting risk from new carbon legislation 23
Slide 24: Cautionary Language Regarding Forward-Looking Statements
Cautionary Language Regarding Forward-Looking Statements This presentation contains management’s guidance for PG&E Corporation’s 2009, 2010 and 2011 earnings per share from operations, projections of Pacific Gas and Electric Company’s (Utility) capital expenditures, rate base and rate base growth, a
Slide 25: Appendix
Appendix
Slide 26: Key Regulatory Filings
Key Regulatory Filings 2011 General Rate Case 2009 2010 2011 Summer 2009: Summer 2010: Prepare and File Hearings January 2011: Notice of Intent Rates go into effect 2011 Cost of Capital Application 2011 2010 2011 Spring 2010: January 2011: Initial Filing Rates go into effect Transmission Owner Rate
Slide 27: Existing Resource Mix
Existing Resource Mix 2008 total sources of electric energy* Net Owned Generation Type Capacity Irrigation Districts 2% (MW) Other Power Purchases Diablo Canyon Nuclear 2,240 35% Utility Owned 30% QF/ Renewables Hydroelectric Facilities Hydro 3,896 18% DWR 15% Humboldt Fossil 135 Total 6,271 * Appro
Slide 28: Renewable Contracts Signed
Renewable Contracts Signed Over 20% of Projected Load Currently Under Contract* Year Max Year Max Project Technology Project Technology Signed GWh/yr Signed GWh/yr 2006 HFI Silvan 142 Biomass 2008 Calpine 1533 Geothermal 2006 Liberty Biofuels 70 Biofuels 2008 Wadham 141 Biomass 2006 Bottle Rock USRG
Slide 29: 2008 EPS - Reg G Reconciliation
2008 EPS - Reg G Reconciliation 2008 EPS on an Earnings from Operations Basis* $2.95 Items Impacting Comparability** 0.68 EPS on a GAAP Basis $3.63 * 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 fin
Slide 30: EPS Guidance - Reg G Reconciliation
EPS Guidance - Reg G Reconciliation Guidance Range 2009 Low High EPS Guidance on an Earnings from Operations Basis (1) $3.15 $3.25 Estimated Items Impacting Comparability(2) Tax Refunds(3) $0.13 $0.16 Recovery of hydro divestiture costs(4) $0.07 $0.07 Accelerated work on gas system(5) ($0.15) ($0.12