Pacific Gas & Electric Co. · NYSE:PCG
Pacific Gas & Electric — PG&E — Edison Electric Institute Financial Conference 2008
28 slides from Pacific Gas & Electric's conference presentation, Nov 10, 2008
Slide 1: PG&E Corporation, Edison Electric Institute Financial Conference
Exhibit 99 PG&E Corporation Edison Electric Institute Financial Conference November 9-12, 2008 Phoenix, Arizona
Slide 2: Cautionary Language Regarding Forward-Looking Statements
Cautionary Language Regarding Forward-Looking Statements This presentation contains forward-looking statements regarding management’s guidance for PG&E Corporation’s 2008 and 2009 earnings per share (“EPS”) from operations, targeted compound annual growth rate for EPS from operations over the 2007-2
Slide 3: PCG: Investment Case
PCG: Investment Case § PCG’s investment case remains solid in turbulent financial times: § Decoupled revenues § Ratemaking mechanisms mitigate exposure to commodity price volatility § 11.45% weighted ROE on 52% equity § Successful execution and timely completion on large scale projects § Sustainable
Slide 4: 2008 Business Priorities
2008 Business Priorities § Deliver on Financial Objectives § Focus on Customer Service and Satisfaction § Identify and Capture Operating Efficiencies § Ensure Workforce Readiness and Alignment § Improve System Reliability 4
Slide 5: Confirming EPS Guidance
Confirming EPS Guidance § EPS from Operations Guidance: § 2008 guidance of $2.90-$3.00 per share § 2009 guidance of $3.15-$3.25 per share § 8% targeted CAGR 2007-2011 EPS from Operations* * Reg G reconciliation to GAAP for 2007 EPS from Operations, and 2008 and 2009 EPS Guidance available in Appendi
Slide 6: % CAGR 2007-2011
% CAGR 2007-2011 New (-3% to- Shares 5%) Add’l 10% CapEx (+1% to 3%) 8% 8% Base 2007- 2011 CAGR 6% 2007 Forecast Guidance { Rate Base Range Growth $2.70- (+9% to $2.80 10%) 2007 6
Slide 7: Capital Expenditure Outlook
Capital Expenditure Outlook $ MM 4,000 $3.6 B 3,500 $3.3 B $3.0 B $3.0 B 3,000 2,500 2,000 1,500 1,000 500 2008 2009 2010 2011 Projects not included in base forecast include: SmartMeterTM Upgrade, Cornerstone Improvement Program, additional generation and gas pipeline investments, and BC Transmissio
Slide 8: Rate Base Growth
Rate Base Growth Weighted Average Annual Rate Base* $ B 30.0 $23.9 25.0 $22.1 $20.4 20.0 $18.3 15.0 10.0 5.0 0.0 2008 2009 2010 2011 * Projected 2008-2011 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.
Slide 9: Current Rate Base: Diablo Steam Generator Replacement
Current Rate Base: Diablo Steam Generator Replacement § Steam Generator Replacement § $700 MM approved capital investment § Unit 2 replacement completed in 69 days earlier this year § Unit 1 replacement scheduled for early 2009 9
Slide 10: Current Rate Base: Gateway Generating Station
Current Rate Base: Gateway Generating Station § More than 90% complete § On budget, on time § Testing phase begun § Begins operations 1Q 2009 10
Slide 11: Current Rate Base: New Generation - Colusa & Humboldt
Current Rate Base: New Generation - Colusa & Humboldt Humboldt § Colusa Generating Station 163 MW § All permits received and cleared § Construction started in early October Colusa 657 MW § Cost cap is $673 MM § Humboldt Repowering Project Gateway 530 MW § Final approvals for site demolition received
Slide 12: Current Rate Base: SmartMeter Program
Current Rate Base: SmartMeterTM Program § Year-end 2008 target: 1.5 million meters installed - 1,300,000 meters currently installed - Over 1 million meters being read electronically Live AMI billing 12/07 Billing IT infrastructure Demand Response live 2Q 2007 Interval Billing Live 05/08 Deployment (
Slide 13: Additional CapEx
Additional CapEx Proposed Projects Above 2008-2011 Base CapEx Forecast § SmartMeterTM Program Upgrade § $460 MM capital § Approval expected around year-end 2008 § Cornerstone Improvement Program (Enhanced Reliability § $800 MM capital 2008-2011 Investment) § $1.5 B capital investment beyond 2011 § B
Slide 14: Additional CapEx: SmartMeter Program Upgrade
Additional CapEx: SmartMeterTM Program Upgrade § Funding request of $572 MM - $463 MM additional capital § CPUC decision expected around year-end § New capabilities - Integrated connect/disconnect switches - Solid state meter technology - Home area network gateway device 14
Slide 15: Additional CapEx: Cornerstone Improvement Program
Additional CapEx: Cornerstone Improvement Program PG&E seeking CPUC approval for a six-year program to improve reliability of our electric distribution system. § Enhances overall reliability of energy delivery § Increases grid flexibility to mitigate outages § Sets higher performance expectations as
Slide 16: Financing Plan 2008-2011
Financing Plan 2008-2011 Objective: Ensure adequate liquidity to fund operations and capital growth • Strong financial profile that will support growth plan • Ensure adequate liquidity Pacific Gas and Electric Company Financings • Maintain authorized capital structure with 48% debt/preferred and 52%
Slide 17: Financial Assumptions 2008-2011
Financial Assumptions 2008-2011 § Capital expenditure base forecast reflects projects that are highly likely or already approved § CPUC authorized ROE is 11.35% and Utility earns at least 12% at FERC on projected rate base § Ratemaking capital structure maintained at 52% equity § Additional capital
Slide 18: Customer Satisfaction Performance
Customer Satisfaction Performance Electric Gas Customers Rank: Rank: Customers Rank: Rank: 2/55 11/56 4/38 2/40 Top Quartile Rank: nd 11/37 2 Business Quartile Overall Customer rd Satisfaction Index 3 Quartile Rank: 46/51 Bottom Quartile 2006 2007 2008 2006 2007 2008 Rank: Rank: 15/58 5/56 5/58 Rank
Slide 19: Key Regulatory Proceedings
Key Regulatory Proceedings Case Docket # Expected Decision Date CEMA A. 08-03-017 Q4 2008 SmartMeterTM Upgrade Program A. 07-12-009 Q4 2008 Energy Efficiency Programs R.06-04-010 Q4 2008 D. 07-09-043 D.08-01-042 Direct Access OIR: Q2 2007 § Phase 1 - Legal Issues 2/29/08 § Phase 2a - DWR Contracts Q
Slide 20: Appendix
Appendix
Slide 21: 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 § $11.0 billion of
Slide 22: Electric Transmission
Business Scope § Wholesale electric transmission services (construction, maintenance) § Operation by CA Independent System Operator Primary Assets § $2.6 billion of rate base (2007 wtd. avg.) Regulation § Federal regulation (FERC) Malin § Cost of service ratemaking Round Mt § Revenues vary with syst
Slide 23: 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 (2007 wtd. avg.)
Slide 24: Electric Procurement & Owned Generation
Electric Procurement & Owned Generation Business Scope § Electricity and ancillary services from owned and controlled resources § Energy procurement program Primary Assets § $1.7 billion of rate base (2007 wtd. avg.) § Diablo Canyon nuclear power plant (2,240 MW) § Largest privately owned hydro syst
Slide 25: Renewable Contracts Signed
Renewable Contracts Signed Over 24% of Projected Load Currently Signed* Year Max Year Max Project Technology Project Technology Signed GWh/yr Signed GWh/yr 2006 Military Pass Rd. 840 Geothermal 2007 Solel 1388 Solar Thermal 2006 HFI Silvan 142 Biomass 2007 PPM-Klondike 265 Wind 2006 Liberty Biofuels
Slide 26: 2007 EPS - Reg G Reconciliation
2007 EPS - Reg G Reconciliation 2007 EPS on an Earnings from Operations Basis $2.78 Items Impacting Comparability 0.00 EPS on a GAAP Basis $2.78 * 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 financ
Slide 27: EPS Guidance - Reg G Reconciliation
EPS Guidance -Reg G Reconciliation 2008 Guidance Range Low High EPS Guidance on an Earnings from Operations Basis* $2.90 $3.00 Estimated Items Impacting Comparability** 0.66 0.69 Estimated EPS on a GAAP Basis $3.56 $3.69 2009 Guidance Range Low High EPS Guidance on an Earnings from Operations Basis*
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