Slide 1: 2023 Second Quarter Earnings: Investing in California's Prosperity
2023 SECOND QUARTER EARNINGS Investing in California’s Prosperity July 27, 2023
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 2023 and 2024 non-GAAP core earnings), equity
Slide 3: Reaffirming Guidance
Reaffirming Guidance… NON-GAAP CORE EPS1 RESULTS EPS GROWTH GUIDANCE New At least EPS 23¢ Equity Second Quarter 10% 2023 $1.19-$1.23 2023 and 2024 Up at least $0 52¢ At least ON TRACK 10% First Half 9% 2024 2025 and 2026 Up at least $0 ON TRACK 10% ON TRACK ON TRACK Endnotes are included in the Appe
Slide 4: 2023: Mitigating Risk
2023: Mitigating Risk… Mitigating Physical Risk Mitigating Financial Risk System Resilience Customers ▪ Expanded Layers of Protection ▪ Simple, Affordable Model ▪ 2023 WMP: 94% risk reduction1 ▪ 2% Non-Fuel O&M Cost Reduction2 ▪ Protections in Place Regardless of Weather ▪ Waste Elimination ▪ Innova
Slide 5: Building On Existing Layers Of Protection
Building On Existing Layers Of Protection… reduction in wildfire 90% reduction in wildfire risk from PG&E equipment1 94% risk from PG&E equipment in 20231 100% Wildfire Mitigation Programs (System Hardening/Undergrounding, Vegetation 80% Management, Enhanced Inspections and Repairs) New or expanded
Slide 6: Physical Risk Mitigation Progress
Physical Risk Mitigation Progress… 1 2019-2023 Actuals 2017 2023 SITUATIONAL AWARENESS ASSET IMPROVEMENTS EPSS High-Definition Cameras with AI Capability 602 Undergrounding 327 MILES COMPLETED CAMERAS INSTALLED PSPS Weather Stations 1,424 System Hardening 1,314 10K UG Program STATIONS INSTALLED LINE
Slide 7: Financial Risk Mitigation Progress
Financial Risk Mitigation Progress… Physical Risk Protections Offered Under AB 1054 Reduction Drives Financial Protections Liquidity Cost Recovery Reimbursement Available when needed Improved prudency standard1 Maximum liability capped Physical Risk 1 Mitigations • Liquidity available as • Utility c
Slide 8: Working With Policymakers And Stakeholders
Working With Policymakers And Stakeholders… Feb 2023 May 2023 June 2023 Sept 2023 Q4 2023 Jan 2024 2020 WMCE Safety Culture 2022 WMCE 2023 Safety Diablo Canyon Pacific Settlement Proceeding Interim Rate Relief Certificate Filing NRC filing Generation Approved Resolved Approved PD Jan 2023 May 2023 Q
Slide 9: 2023 Report Card
2023 Report Card… Metric Q2 2023 Status 2023 Goal Long-Term Goal Catastrophic Wildfires1 0 0 ON TRACK Undergrounding Circuit Miles 350 10,000 ON TRACK Annual O&M Cost Reduction (Non-Fuel)2 2% 2% ON TRACK Rate Base Growth3 ~9.5% CAGR 2022-2027 ON TRACK Non-GAAP Core 2023 & 2024 at least 10% At least
Slide 10: Non-GAAP Core EPS Comparison
Non-GAAP Core EPS1 Comparison… First Half Second Half Factors 4¢ 55¢ (2¢) (1¢) 52¢ (4¢) Customer Capital Investments Operating & Maintenance Savings Enables Redeployment 2022 Operating & 2023 Redeployment Timing Other First Half Maintenance First Half Endnotes are included in the Appendix. …On Track
Slide 11: Customer Investment Grows
Customer Investment Grows… CapEx Amount (billions) $16,000 Avg. $8B Avg. $10B Avg. $13B /year /year /year $ 16 $14,000 14 Generation, $12,000 IT & Other 12 $10,000 Non-WF Risk Reduction 10 Customer & Connections Electric Distribution $8,000 8 Wildfire Mitigation, System $6,000 Hardening & Undergroun
Slide 12: Substantial Incremental Opportunities
Substantial Incremental Opportunities… Opportunities $5B Growth • Transmission • Distribution Generation $52B • Hydro • Storage Efficiency • IT & Automation • Waste Elimination • Sourcing CapEx Next 5 Years …To Better Serve Our Customers 12
Slide 13: Simple, Affordable Model
Simple, Affordable Model… MODEL1 Examples of O&M Cost Reductions (Non-Fuel) OPPORTUNITIES 2022 2023 Long-Term Actual Plan Plan Customer Capital Investment ~9% Good Business Decision (millions) (millions) (millions) - Attrition $ 25 $ 25 $ 25 - Efficiencies & Insurance 270 200 50 Offsets - Capital Co
Slide 14: Value Proposition
Value Proposition… 2022-2024 2025-2026 Non-GAAP Core EPS1 (CAGR) 10% Non-GAAP Core EPS Growth At least 10% At least 9% Dividend Declare as soon as Q3 2023 Earnings Call2 Annual Non-GAAP Core EPS At least 10% At least 10% Growth & Dividend Yield Rate Base Growth (CAGR)3 ~9.5% O&M Cost Reduction (Non-
Slide 15: Leveraging External Innovation Ecosystem
Leveraging External Innovation Ecosystem… Top Tier Talent The Future at PG&E R&D Strategy Report Identifying breakthrough solutions Delivering for our people, the planet 70 problem statements to inspire bold and the prosperity of California new ideas ▪ Grid Research, Innovation ▪ Cleaner ▪ Supply &
Slide 16: 2023: Mitigating Risk
2023: Mitigating Risk… 2023 EPS1 Guidance: $1.19-$1.23 ON TRACK Up at least 10% ~$52B Five Year ON TRACK Capital Investment Plan ~9.5% Rate Base ON TRACK CAGR, 2022-2027 10% Non-GAAP Core ON TRACK EPS1 CAGR, 2022-2026 Endnotes are included in the Appendix. …And Earning Trust 16
Slide 17: Q&A
Patti Poppe CEO Q&A Carolyn Burke EVP, Chief Financial Officer
Slide 18: Appendix
Appendix
Slide 19: Table of Contents
Table of Contents Appendix # Title Slide (Link) Appendix 1 2023 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 2023 EPS Sensitivities Slide 23 Appendix 5 SB 846 Diablo Canyon Legislation Slide 24
Slide 20: Appendix 1: 2023 Factors Impacting Earnings
Appendix 1: 2023 Factors Impacting Earnings Key Ranges Weighted Average Rate Base2 Non-GAAP Core EPS1 Equity Ratio:3 52% Return on Equity:3 10.00% $1.19-$1.23 General Rate Case ~$44.5 - $48.5B New Equity in 2023 and 2024 Transmission Owner ~$11.5B $0 Total Rate Base ~$56 - $60B Non-Core Items4 Key F
Slide 21: Appendix 2: CapEx And Rate Base
Appendix 2: CapEx And Rate Base Weighted average rate base ($B) Upside Opportunities (+$5B CapEx)1 projected Growth Generation Efficiency ~9.5% CAGR on equity rate base 2022-2027 $67-$89 • Transmission • Hydro • IT & Automation $65-$82 • Distribution • Storage • Waste Elimination $60-$67 $62-$74 ~$5
Slide 22: Appendix 3: Expected Recovery Of Wildfire-Related Costs
Appendix 3: Expected Recovery Of Wildfire-Related Costs Approved Cost Recovery (Final Decisions) ($ in Millions) Expected Rate Recovery by Year Recovery Balance at YTD 2023 YTD Rate As of Application Through 12/31/2022 Expense Recovery 6/30/2023 2023 2024 2025+ 2018 CEMA 144 - (144) - 2020 GRC1 Dec
Slide 23: Appendix 4: 2023 EPS Sensitivities
Appendix 4: 2023 EPS Sensitivities Sensitivity EPS Mitigation Sales Volume Electric Sales (GWh) +/- 1% 0¢ Decoupled Gas Sales (Bcf) +/- 1% 0¢ Decoupled Commodity Prices Power Prices Regulatory Deferrals; +/- $1 0¢ CAISO NP15 ($/MWh) ERRA, Supply PPAs Natural Gas Price +/- 50¢ 0¢ Monthly True-Up; Hed
Slide 24: Appendix 5: SB 846 Diablo Canyon Legislation
Appendix 5: SB 846 Diablo Canyon Legislation Estimated Cost of Diablo Canyon Extension Compared to Alternative Non-GHG Emitting Technologies People $140 - 165 per MWh $60 Planet per MWh Prosperity Alternative New Renewable Diablo Canyon Baseload Generation Cost Recovery 2022-20241 2025-20302 Pre-Ext
Slide 25: Appendix 6: Wildfire Mitigation Plan Progress
Appendix 6: Wildfire Mitigation Plan Progress 2019-2023 2023 650 ACTUALS1 TARGET Undergrounding Our Lines 300 120 Undergrounding powerlines to reduce wildfires caused by equipment 327 MILES COMPLETED 350 MILES 7 48 2019 2020 2021 2022 2023 1,644 System Hardening 1,224 Strengthening our grid by insta
Slide 26: Appendix 7: PG&E Utility Securitization Program
Appendix 7: PG&E Utility Securitization Program The Utility has completed $9.3B of $10.7B securitization issuances expected over the next several years Complete AB 1054 Securitization Rate Neutral Securitization A.20-04-023 A.22-03-010 Statutory • SB 901 signed into law on September 21, 2018 • AB 10
Slide 27: Appendix 8: Regulatory Progress
Appendix 8: Regulatory Progress Status as of Regulatory Case/Filing Docket Expected Milestones1 July 2023 2023 GRC filed 6/30/21 2023 GRC A.21-06-021 Final Decision Q3 2023 Wildfire Self-Insurance Final Decision received 1/12/23 TO21 Filing expected Q3 2023 2023 Application filed 4/20/22 2023 Cost o
Slide 28: Appendix 9: Presentation Endnotes
Appendix 9: Presentation Endnotes Slide titles are hyperlinks Slide 3: Reaffirming Guidance 1. Non-GAAP core EPS is not calculated in accordance with GAAP. See Appendix 10, Exhibit A for a reconciliation of EPS on a GAAP basis to non-GAAP core earnings per share and Appendix 10, Exhibit E regarding
Slide 29: Appendix 9: Presentation Endnotes
Appendix 9: Presentation Endnotes Slide titles are hyperlinks Slide 13: Simple, Affordable Model 1. These numbers are illustrative approximations. 2. The Utility’s cost reduction strategies include increased efficiency and waste elimination driven by implementing the Lean operating system, improving
Slide 30: Appendix 9: Presentation Endnotes
Appendix 9: Presentation Endnotes Slide titles are hyperlinks Slide 20: Appendix 1: 2023 Factors Impacting Earnings 1. Non-GAAP core EPS is not calculated in accordance with GAAP. See Appendix 10, Exhibit A for a reconciliation of EPS on a GAAP basis to non-GAAP core earnings per share, Appendix 10,
Slide 31: Appendix 10: Supplemental Earnings Materials
Appendix 10: Supplemental Earnings Materials Exhibit Title Slide (Link) Reconciliation of PG&E Corporation's Consolidated Earnings Available for Exhibit A Common Shareholders in Accordance with Generally Accepted Accounting Slides 32-36 Principles ("GAAP") to Non-GAAP Core Earnings Exhibit B Key Dri
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, 2023 vs. 2022 (in millions, except per share amounts) Three Months Ended Six Months E
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, 2023 vs. 2022 (in millions, except per share amounts) (2) The Utility recorded costs
Slide 34: 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, 2023 vs. 2022 (in millions, except per share amounts) (4) Includes any earnings-impac
Slide 35: 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, 2023 vs. 2022 (in millions, except per share amounts) (6) Includes adjustments associ
Slide 36: 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, 2023 vs. 2022 (in millions, except per share amounts) (8) Includes costs associated w
Slide 37: 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, 2023 vs. 2022 (in millions, except per share amounts) Second Quarter 2023 vs. 2022 Year to Date 2023 vs. 2022 Earnings Earnings per Earnings Earnings per Common Share Common Share 2022 Non-GA
Slide 38: Exhibit C: PG&E Corporation's 2023 Earnings Guidance
Exhibit C: PG&E Corporation's 2023 Earnings Guidance 2023 EPS Guidance Low High Estimated EPS on a GAAP basis ~ $ 1.04 ~ $ 1.13 Estimated Non-Core Items: (1) Amortization of Wildfire Fund contribution (2) ~ 0.16 ~ 0.16 Bankruptcy and legal costs (3) ~ 0.03 ~ 0.02 Fire Victim Trust tax benefit net of
Slide 39: Exhibit C: PG&E Corporation's 2023 Earnings Guidance
Exhibit C: PG&E Corporation's 2023 Earnings Guidance Exhibit (3) “Bankruptcy E:costs” and legal PG&E Corporation's consists 2020 of legal and other and 2021 costs associated withEarnings Guidance PG&E Corporation’s and the Utility’s Chapter 11 filing, and exit financing costs. 2023 Low High guidance
Slide 40: Exhibit C: PG&E Corporation's 2023 Earnings Guidance
Exhibit C: PG&E Corporation's 2023 Earnings Guidance (5) “Investigation remedies” includes costs related to the Paradise restoration and rebuild, the Wildfires OII decision different, the settlement agreement with the Safety and Enforcement Division’s investigation into the 2020 Zogg fire, and the l
Slide 41: Exhibit C: PG&E Corporation's 2023 Earnings Guidance
Exhibit C: PG&E Corporation's 2023 Earnings Guidance (7) “Strategic repositioning costs” includes one-time costs related to repositioning PG&E Corporation’s and the Utility’s operating model, including their workforce, and costs associated with the potential sale of a minority interest in Pacific Ge
Slide 42: Exhibit D: GAAP Net Income to Non-GAAP Adjusted EBITDA Reconciliation
Exhibit D: GAAP Net Income to Non-GAAP Adjusted EBITDA Reconciliation PG&E Corporation Second Quarter, 2023 vs. 2022 Three Months Ended Six Months Ended June 30, June 30, (in millions) 2023 2022 2023 2022 PG&E Corporation’s Net Income on a GAAP basis $ 410 $ 360 $ 982 $ 838 Income tax benefit (335)
Slide 43: Exhibit E: Non-GAAP Financial Measures
Exhibit E: Non-GAAP Financial Measures Non-GAAP Core Earnings and Non-GAAP Core EPS “Non-GAAP core earnings” and “Non-GAAP core EPS,” also referred to as “non-GAAP core earnings per share,” are non-GAAP financial measures. Non-GAAP core earnings is calculated as income available for common sharehold