PG&E (PCG) Q4 FY25 earnings call: guidance and Q&A

What is most encouraging about the CEA process, and is there broad alignment for legislative action sooner than September?

Patti Poppe emphasized the complexity and the need to 'get it right,' supporting the CEA's focus on actionable, viable, and durable solutions. She highlighted the goal of making risk knowable and affordable for customers and investors, and that the current model is regressive.

“Look, this is a complex legislative effort, and we definitely want to support taking the time to get it right and getting the right outcomes. And obviously, the sooner, the better, but we want to make sure the most important thing is getting something right done this year.”

asked by Nicholas Campanella · answered by Patricia Poppe

If legislative progress on SB 254 doesn't go as planned, how would PG&E prioritize capital allocation (investment, dividend, etc.)?

Poppe stated that the current valuation is unsustainable and PG&E is advocating for legislative reform. She affirmed that if progress on SB 254 stops or derails, 'all aspects of our plan must be and will be on the table,' without specifying a hierarchy of cuts, but emphasizing that performance is power and they won't sustain the current valuation.

“if progress stops or derails or we feel that the state has lost interest in getting to the right outcome on 254, then obviously, all aspects of our plan must be and will be on the table. We will not continue to sustain this valuation.”

asked by Nicholas Campanella · answered by Patricia Poppe

What is PG&E's take on the CPUC's recent view on SB 254, and how influential might they be with the legislature?

Poppe noted that the CPUC shares PG&E's view that the current model is regressive and burdens IOUs and customers. She believes the CPUC's support for a 'whole of society approach' will be influential, especially given PG&E's performance in lowering rates while improving service.

“The CPUC sees what we see that this is -- this current model is regressive, and it's putting excessive burden on our electric IOUs and our customers. And so I appreciated them sharing their points of view. They support what we support, which is a whole of society approach.”

asked by Steven Fleishman · answered by Patricia Poppe

What is the timeline for data center ramp beyond 2026, and is the final engineering stage fully incorporated into the 0-3% bill growth and CapEx opportunities?

Poppe clarified that the load growth is part of the 0-3% bill trajectory. She expects about 50% of the 3.6 GW in final engineering to be online by 2030, contributing to the 2-4% load growth within that period. She also mentioned other factors like O&M and supply cost reductions contributing to affordability.

“as we look at the ramp to 2030, we can see about 50% of that 3.6 gigawatts online by the end of that range, so 2030. And so that's in that zone of 2% to 4% within that 5-year time period.”

asked by Unknown Analyst · answered by Patricia Poppe

What is the incentive for continued balance sheet improvement, and what is the line of sight to multi-agency investment grade?

Carolyn Burke stated that Fitch upgraded them to investment grade, and Moody's and S&P already consider their financial metrics to meet investment-grade criteria. She noted that the other agencies are primarily looking at progress on SB 254, rather than further balance sheet improvement. PG&E remains committed to mid-teens FFO to debt.

“Both Moody's and S&P have said that our financial metrics are meeting the investment-grade criteria. What they're really looking at is, again, the progress on SB 254 less of continued improvement in our balance sheet.”

asked by Unknown Analyst · answered by Carolyn Burke

How does PG&E think about the $5 billion in upside capital, when would it be deployed, and how would it be financed given the current CapEx plan?

Carolyn Burke explained three options for the $5 billion: making the plan bigger (least likely), making it better (accelerating capital for new load to improve bill trajectory), or making it longer. She indicated that 'making it better' is the most likely approach, keeping within the $73 billion CapEx envelope. Financing would prioritize avoiding new equity and maintaining mid-teens FFO to debt.

“where the way we think about that $5 billion is if there's any additional capital coming in, it's probably option 2, where we're looking to make the plan better, keeping to the $73 billion envelope of our capital plan, but ensuring that we can drive affordability for our customers with that additional capital.”

asked by Julien Dumoulin-Smith · answered by Carolyn Burke

Is it expected that wildfire policy reform will be completed in this legislative session, or could it extend to other processes?

Patti Poppe expressed strong hope that the substantive risk and cost allocation issues will be resolved during this legislative session, noting it's the second phase of a two-phase process. She praised the CEA's professionalism and adherence to the planned process.

“We are very hopeful that this has resolved the substantive risk and cost allocation we're very hopeful that this is resolved during this legislative session. That would be -- this is the second phase of a 2-phase process, a 2-year session.”

asked by Carly Davenport · answered by Patricia Poppe

What are the expectations for the Kincade and Dixie cost recovery proceedings, and what amounts are being sought?

Carolyn Burke detailed the filing made in November 2025, seeking recovery for over $1 billion in claims paid by the Wildfire Fund ($674 million), WEMA costs of $1.6 billion (for the 'doughnut hole' between insurance and Wildfire Fund threshold), and CEMA costs of $314 million. She emphasized that PG&E had valid safety certificates for both events, supporting their prudency case.

“What we submitted is a review of the costs that were paid by the wildfund associated with Dixie and Kincade, that's over $1 billion in claims. That's about $674 million. We're also looking for recovery of WEMA cost, which is about $1.6 billion. And that's primarily, if you think about this, remember, we did not have the self-insurance at that time.”

asked by Gregg Orrill · answered by Carolyn Burke