PCG - Earnings call transcript Q3 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the PG&E Corporation Third Quarter 2020 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Matt Putnam, Senior Director, Investor Relations. you. Thank ahead. go Please

Matt Putnam

And attending. those Rob. the you phone for thanks you, of to on Thank

this are you and I of that Kenney, Vice Interim us discussion President John Chief and Officer. Regulatory Joining want Ethics morning joining and to Pacific Simon, Chris Executive Interim Also Officer; General forward-looking Foster, Company Gas Officer, Affairs. remind results, which include outlook and Executive Robert will Chief & assumptions, are Electric Vice Vice our Counsel based currently information today Compliance Management. for President our available and President us financial and today Interim President of Financial Bill about on External statements Chief expectations, are to Smith, forecasts, and future our Lewis, Michael

includes of described at third Some results earnings The financial could most investor.pgecorp.com. of that could other and today's be page also online factors reconciliation the Company's presentation. along quarter information found affect actual the with GAAP measures important the on call between and second non-GAAP the are presentation

the also of appears you QX, We to on Form and quarterly I'll it was and that, filed factors turn review report risk with in over encourage Bill. the our XXXX there today earlier in XX-Q Annual Report Form that SEC on to our the that XX-Q discussion XX-K. With

Bill Smith

and Matt, you good for Thanks, morning today. everyone. us joining Thank

customers. X responders CAL We wildfire Governor’s to impacted a nearly quarter, acres in the for been experienced our want by very million lease their California. burned acres in we’ve out for first efforts express and wildfires of of new and our safe. office, service sympathy devastating Office million thank keeping area. X in California priorities the Services the history for Emergency in tireless all with I We’ve burned the FIRE, California cover I challenging the for our over Before all those seen season It’s

executing made customer a live changes plan areas at outcomes, three our operations I’ll on and This commitments focus of These help our focus to changes a to our including series chapter our touch emergency important improve as of PG&E. PG&E. continue enhance risk We reduce the us focus. and safety will morning part to on for efforts of up XX key

First, second, operational progress. improvements and recruitment cover our leadership Chris our our to financial will wildfire then mitigation key and our plan; updates updates cases. executive regulatory third,

plan, or situational implementing our ignition Looking remain highest our and enhancing at risk, PSPS awareness advance. mitigation shutoff power safety our wildfire mitigating priorities public

events protect absolutely these will safety. to initiate necessary public when We

see hardening, ahead on and high to vegetation As you on targets or be definition can slide enhanced for XXXX our system of installation weather continue and X, management we stations cameras. of track

track. installations on Our the and our have last efforts over camera weather back station quarter

respond all information safe share monitoring will We report goals the monitor a management reliable -- in the PG&E’s in for such unit next vegetation in week the request we judge operate ensuring grid. and court's inspections

do see areas While up the we provided results the of letter XXXX mitigation that some our plan wildfire there are we could stood than some we acknowledge the in differently where somewhat improve, monitor. comprehensive by

Safety wildfire on We and will give PSPS which November one program. our response Power on ahead Xrd. any are comment or I'll filed of aspect detailed update There of unable Shutoff a to be further the is program our that's mitigation Public that

with XXXX talent a cooperation done have additional expertise. planning lot by increase local to We hiring emergency since with authorities

The that season. We customers our this better improvements help also highlighted are achieve slide technology our will us X. goals with prioritize program wildfire on communications

communities other fuels to we wind as will speed, safe. power evaluate When continually customers levels humidity last have in among resort moisture shut-offs implement a we and conditions warrant As we'll factors. include and prior conditions years, keep that our

have minimize the five our so steps and year. We customers events impact to far on this executed of events these we've taken

important by event as implement communities technology, our to made engaged leveraging smarter continue versus in capabilities. implementing into program sectionalizing with our speeds weather changes through assessing with a wind with improved event. incorporate and national increasing do fire their determine along we fuels with devices in data PSPS our in it these while we smarter the forecasting is from fuels post inspection collect utilize make We modeling. time. to real well and our events need and to conditions where event. We've we moisture XXXX events collaboration and that in customers as to data data our our learn work feedback fire we disruptive an making To have indicator This smaller spread implement We incorporate the shorter we along each temporary by service XXXX have generation less

improve program priority to is to customer the Our impacted next footprint make the smaller.

events. pre-positioned that sectionalizing are place end were by in August. We have installed generation regions devices XXX of shut-off We temporary which prone to the in

XXXX in abilities of aerial customers In In goal shorter Bay added and started This we've listening fixed-wing PSPS previous reduction addition, the responders patrol helicopters for XXXX. touch and allow the focus in online. season. outreach actions emergency managers aircraft. our PSPS additional than to stakeholders XXXX. of on now sessions an I'd events. In to help one-third areas local to couple example how coordination learned through of county with working one we've a to city stations to time and of the improve configuration would in outages at and us helicopters leaders holding first other order impacted of XX implemented where almost we've We which increased shut-off stay have more allowed Those wildfire a our our our us senior residents. Humboldt meet Caribou lessons events. to implementation meet XXXX. make access with PG&E listened in our goal increased we've our to December, to we managers, customers. city XX,XXX This our generating includes customers restoration customers from and on first the Islanding At XX% faster These sessions hall and like have been plans started versus coordination these town to

then we events team on discussions subsequent worked in local the listening these learned information where the we based for through held plans Our sessions.

contact As as shutoff of and who serve the listening managers. an individual example change cities single These PG&E from with of important during point resulting sessions, increased a personnel we emergency event. counties these made presence employees local of power for a coordinate

in serve. We on and wildfire lessons in On receive the customer ask counties changes significant learned XXXX. valuable which webinars of specific safety We basis. the during made we questions initiatives on we've to a the side, conducted response our in address county used focused we've feedback also to concerns to on county worked needs hard by We've customer engagement PSPS related areas three events. and customers

notification system. our is first The

third notification advance improved Outage our by will expected messaging our last The an The as customers’ the shutoff information is resources response of warning and a as message work safety an time. XX direct With notification approximately second to conditions hours sent when notify customer messages restoration our customers to hours include an PG&E. and to initial year. website regard necessary. These with to show be and watch X PSPS event. will a updated forecasted is prior we event. early restoration upgraded feedback watch provided is to are system that in Warning notifications XX from We also throughout be event. the to

the usage we centers our Second, tested the our peak website from site to demand we the XXXX. during beyond in data improvements on cloud to we our have where pge.com levels well moved saw

web XXX,XXX place go other days occurs. shutoff community are in by XX event resource our number a By This comparison we resource before during estimated provide customers early analogy PSPS an available event power for first for enhanced to Also, for events. impacted. centers times increased allows for information capability two during the to charging look customers available had address. our necessities. In shutoffs we centers These with customers stations, is Our as impacting XX centers as up of this restoration community bottled and had and water centers equipped we X million XXXX year and customers. times

COVID these locations safety with All protocols. comply of

incremental to PSPS implementation. wildfire plans our our to improve and We have mitigation technology expect leverage to opportunities

certification and and steps on next to we continue at on We our to customers the before the feedback our to we request wildfire this CPUC respect day and incorporate decision outcome from see believe, leaders information now. improve we community of necessary safety any our filings, indicated provided a these We that updates as events. to the we month. With hope end anticipate all by

As the in prior we remains reminder year received a last certification place.

adjustments and additional was a wildfire deadline filing. One reflect the division the mitigation our take California. will on PG&E wildfire the cause of plans well submission. wildfire in as notified has all as that the in week earlier equipment February PSPS from we a the that note Cal investigation forward, west mitigation Looking part were our into fire our as of IOUs their possession three we fire of taken month ongoing of gave Zogg XXXX operations them plan Last safety which for Redding, learnings will

to the by opportunity Given an the provide there is we CAL review the retained early fact stage FIRE the and that information assets additional investigation of had to haven't today. limited

the in its Zogg will provide at investigation the cooperating appropriate information fully FIRE We fire are more on with time. and CAL

Monday addition In information request the response to Alsup's Zogg on a fire. filed we on Judge for

comment want to we of FIRE not will the ahead get any as further to We investigation. not do CAL

effort team. operations work the our to electric gas are While by risk to continued I our an wildfire area want our operations focus of done mitigate given certainly also good highlight

This of of strength a to enable be safer it's taken for preferable of a method the and of which the testing testing is in the safer major ways. line than couple It our in-line inspections. initiatives to can out system make to eliminates One to is hydrostatic gas need pipe. compromise traditional hydrostatic testing for service the

direct third-party two the want mention of standards. times we upper provide are day-to-day In ensure our reliable dig-in gas at improve areas to two focus are of industry our of our that opened and evaluation end operations. opened gas of average odor to rates have comprehensive terms delivery. response in XXXX operations. safe helped us that operations to facilities and These response we in centers gas These were I our

XXXX in safety we to us that the technologies. test for allows gas First, new has expansive lab which center space opened

gas we safety Second, opened our academy.

encounter team given offer we gas operations technology two a open to training ensure have training facilities These simulates various gas drive improvement. operations we necessary that our Here space team the emergencies in to our and continuous that territory. we were centers

increasing in and leadership open a alignment look path risk a CFO. cover three business roles. lot our making of also executive to is as forward same last searches wild singular Utility the end to remain fire improve. safety that to to inform by CEO these name We search kicked hard we new the we reducing to abilities item supported national to off for gas our mitigation and firm backgrounds. as progress our on will a work will are of a help like by We to President continue have efforts accomplished track the we're We've on key practices being leadership The the the year. while the implemented and All we continue a I'd of well with

our CFO. exciting. taking the search off to our Francisco Officer. Information permanent strong fortunate as is are to Chief few our hires include We very PG&E Chris leading Chief Chief Benavides Ajay interim Officer finance conduct a lead Sumeet Officer, recent will CFO. Foster Safety as build a reflect Singh commitment recent Chris Waghray leaders that our while department for These Those additions These a and the to are we change. three team our very have Risk

continuously that safety while I'd We to to for implement we've ways to like looking technology new focus off. to with on a increase a efficiency. will that recent kicked on operate continue a build and initiative bit, To share risk

focused at a operations. look taking are our We

asset closing creating track I to share an will measure and relationship experience. frontline have initiative to appreciation look by to employees. monitor on as all implementing approach improve our to we express PG&E our this efficiently management practices customer tools my more management enterprise move and XXXX. operate adopting In with We'll want consistent for more work our and We customers to into

programs navigating across are they continue risk gas Chris and a systems. turn operating and it our reliability reduction safety Chris? employees environment over to on execute and to Our cover I'll that some and to key difficult cases. electric regulatory financials With

Chris Foster

as highlighted I plan good Thank which key the items you four morning on everyone. Bill covering takeaways and are XX. on

consistent we coming on is reflective the five-year This the the growth anticipate quarter. are track years. we reaffirming First of last over guidance and we earnings set

insurance our an update Second, I'll coverage, provide needs. on and of COVID the financing our impact

on provide Third, that regulatory I'll cases clarity. our meaningful progress highlight additional revenue

I'll guidance range quarter share. our with between guidance briefly reflect Lastly, the earnings highlighted $X.XX our third XXXX loss Starting on earnings GAAP $X to and results. We've a XX. slide elements, slightly cover they're per updated for

per We XXXX. XXXX factors and well as share are core for guidance reaffirming our both non-GAAP earnings earnings as

rate guidance. in weighted noted includes the The authorized receiving drivers Specifically unchanged. in This our This are in assumptions XXXX core earnings year case for a here XXXX, X.XX decision general of $X.XX of remain return variants from fourth - shares final XXXX. Also the is underlying per earning a non-GAAP we quarter. are roughly in XXXX average to key the or billion of based guiding approximately share. on $X the billion $X.XX

TOXX guidance approval the I'll and color. this items our in waiver fourth settlement of with Fed’s quarter. to rate assumes Our back separate is request consistent provide settlement more the these AFUDC formula regulatory to reflected come also in

Moving a made these of We've guidance couple to the which same is broken earnings to out slide. non-core on items. adjustments

bankruptcy of share The to a fair million costs the price the adjustment fee of reflects range billion value the $X.XX backstop July. to to at to range of equity required for $XX the increased beginning the and $X.X based billion. final range the on Our legal increase

Roughly from XX spend. the remedies decrease non-core $XXX XXXX $XXX is items of towards we we investigation will wildfire for million the permanent year. is that and The forecasted recovery requirement. and difference million this for the have Additionally, apply OII it to spend will million cost spend impact lowered timing remaining

for the guidance $XX $XXX We XX-K the by year. fire million have approximately related million increased for XXXX costs to

in claimants third led increase quarter, million information from the accrual segregation $XXX from claims potential received insurance to During million our that we to $XXX including an pre-tax.

fire, access $XX fire's they million of the concave includes category evidence As period we the continue or have items. investigative it to included also not regulatory This the We've pickup collected. relates to report three to for net Cal have prior category recoveries. a

related the XXXX consistent capital First, with previous guidance. audit we've included revenues GTS to

impact order now settlement also FERC. associated the of the we've pickup are quarter This added TOXX partially a year that and AFUDC are modified with XXXX offsetting FERC's for reductions our two first items filing recent on prior with the TOXX revenue pending

Our contribution remains the amortization fund guidance same. wildfire full of for year the the

guidance to slide Moving XXXX XX. on

for continue million $X.XX is non-GAAP We our a $X.X to is earnings or below $XXX mostly million the core to see to target of core expense of million This authorized year non-GAAP $XXX $X.XX share. comprised range of This billion to to interest $XXX $X.X earnings per billion million. approximately levels. $XXX

above revisiting $XXX contracts wildfire we million below additional brings off range $X authorized as net as efficiency This us spend there. to for million line Additionally, mitigation the to includes will our measures. and work carry such and taper of out contracted

on and asset these effect and on COVID-XX our the sales, insurance Next I'll non-core financing of the impact our coverage of needs. cover items updates

million back our to we in impacts remain reduce in customers. set are Based application mentioned of selling every considering progress the a our the that to the could made million the we range the our office also illustrated $X of $XXX We've a shown price set we the have from $XXX in equity billion on transaction an application If second out an end there, organization. approval would assets. of a in benefit fulfilling our to for with but small forecasted sale plan flow we year. call, As We Francisco filed some process high our non-core in on complex million early front. $XXX San successful sell such XXXX, commitment for quarter of CPUC

timing We of are sale. looking at XXXX likely for the the

Moving to insurance. wildfire our

the Roughly overall up impact component in $XXX made regard coverage insurance coverage the of to for a updates fourth period. met have I will over insurance short-term We've the progress continue We of future the anticipate made as COVID-XX for timing combining front. filed achieving million accounts to periods. we wildfire our that year impact on that significant general timing to to office building of for few we of the COVID-XX, now last costs, our puts be track transmission in few the the equity will the operating well ranges a been a $XXX needing covering guidance and to a regulatory that short-term ago, to during keep in cash owner costs foresee items settlement as on related of recovery we experience see at weeks million start million the insurance us When We debt. do That approval code uncollectible I'll higher has shift additional memorandum with incremental quarter. higher to XXXX with costs path out created recorded areas we liability needs. sale Two costs, the in these changing of set not the in subject the With costs. case $XX FERC. quarter. portfolio accessing FERC. the by since the progress to we quarter rate second collection is

support I'll There set elements broad pleased of parties. highlight. are outcome the settlement the are and of settling We that with to few the the

$X.X settlement That back AFUDC First with AFUDC and outlines separate completion filing FERC end will of largely case assume reached on XXXX The an review does recovery multi-party the by equity. higher by to structure to management settlement changes the us XXXX. insurance, XXXX our capital capital approved now if generate through that impact is and of equity The expense include XXXX guidance. mitigation to and the allow received on not being we that vegetation was The establishes reviewed proposed a modified total FERC and a billion to for a track XX.XX% our a staff we May of the with XX.XX% first QX. wildfire on we process that is rate liability CPUC. I'll on process similar additionally our unchanged. the place released the we to waiver of decision ratio settlement expense. December is earnings establish cases cost does last return outcome decision requirement and week apply equity all-in that clarity Last brings factors in The shift remain or case. These proposed the revenue formula a throughout of annual and XXXX.

in for of wildfire by deadline XXXX in a us also last with December. decision Specifically decision to are catastrophic year anticipate XXXX our keep roughly considered to costs two the decision would events recent separate previous this June. end above by amount. of proposed timing over spend that million the a the million forecast in final ("AB") These XXth roughly recovery the recover the mitigation we were amounts Related in from file It costs. magnitude our These for excluded track at forth received not set for week and based us a SEMA mitigation these on filing we our XXX% to case of or the of of are roughly authorized statutory decision beginning require The capital which WMCE the $X.X related proposed at through sought also $XXX the proposed us reductions CPUC allows years. applications projection. and capital wildfire of billion through based recovery the XXXX rate our authorized aligns so CPUC. December costs do We've of well change $XXX the rate already to costs should

quarter mitigation the the and CPUC begin securitized could on a costs. anticipate wildfire wrap to Now or our hearings with the recover securitization at we following. filing, WMCE events debt catastrophic filings procedural of December in XXXX path closely offering remaining in up On the becomes the the the based second schedule case

our preparing XXXX the XXXX be we also generate after ("AB") final case. in separately will the securitization related decision receive We filing

public for state. policy transportation electrification. vehicle area remains XX% The gases last focus due the in to the of total a largest is to accounting of like I'd the touch on greenhouse California forward the Looking emitter for broad sector roughly

reduction reductions So the emission clear. for as our goals is meeting of part sector statewide carbon in need this is

the More grid Our to consistent customers’ continues vehicles vehicles among five one reflected space electric into growth we electric nationwide vehicles XXX,XXX out PG&E's OEMs. than excitement and be see of competitive to increasingly electric for levels. plug representing additional in every adoption due

CPUC CPUC charge this three approved ports oversubscribed. than charging heavy times our Governor portfolio and and more XXXX early support executive Our of for States. in have United is a utility the one XX-year network as in by installed of energy an roughly is duty as XXXX X,XXX anticipate of zero by time, program this submitting of we any of electric clean an for passenger at order the current vehicles one XXXX. The infrastructure recently transportation the filing At interest EV medium largest vehicle we vehicles part state's indicator our emission issued phase goals and liferification by plan customers’ the

I'd and our the non-core transition shown full is including the year non-core share to for I third the result. at Slide per are guidance third year consistent consistent with in guidance. Now XX to came core items our $X.X The billion with full also year quarter items results here. mentioned. are earnings Non-GAAP shows earnings for financial GAAP quarter. our like XXXX

expense well comparison increase as drivers $XXX timing $XXX of reverse. earnings or $X.XX year. quarter-over-quarter are core that to last were $X.XX two Moving million third non-GAAP for as July quarter The each the an primary on in outstanding expected XX or in slide shows Xst from and items equity rate million shares our the of this interest year

costs is is first taxes. the timing case and The second recovery generate the of XXXX

we the executing financial full focused after now set quarter out. bankruptcy, on behind the us we're plan very and well on With operational the

discussed With are the projection our excited energy questions? clean that for from supported focus have long-term we could I We opportunities earnings of technology. a for outcomes and ahead on by that regulatory please the state's us open you operator provided are lines that strong

Operator

Morgan next Your Stephen line Stanley. Instructions] of from [Operator question Byrd comes the to

Your open. is Byrd line your is line open. Stephen

next Your from Bank line comes Julien from of of America. the question Dumoulin-Smith

Your open. line is

Julien Dumoulin-Smith

me you Can morning. good Hey now? hear

Bill Smith

hear morning. Yes can we Good you Julien.

Julien Dumoulin-Smith

Thank morning. you. Good

some all here or So details, and it. Any the talk of perhaps here? peers where certification context for we back your we certainly have provide had can you have can you if about as us wildfire about and I the I that and go stand otherwise it, would both thinking forthcoming process here your a specific to given clearly deadlines thank just on you expectations to obtaining articulated itself nuances delays just as to process follow-up? today the mean

Chris Foster

I Bill filed that think Sure Again seeking filed the all was Julien. that think July on No the information relevant this XXth. commission at is problem. have that laidout, We we stage. we as

do terms little context the the a couple just offer we of I still confusion month. So anticipate of because think been in it I think a commission of What is to about ways decision bit around the from it. a would end there's maybe by

that that the have into commission keep First you'd scenario safety place. not the of a a to If commission's in important occurring. to -- it's remains certificate we run were the prior while things in where couple mind approve decision

and improved the have to we would construct. the the wildfire prudency fund liability have ability cap access protections but XXXX AB lose the continue we of the to to First shareholder would

provide being you as to other Julien, wanted to outcome wanted a provide that just scenario the what don't anticipate the but I that. just look to help So way about We think like. could that for

Julien Dumoulin-Smith

it's context and talk with right. little Zogg All that know fits this decision but at fire, Excellent. you in it. the Again framework certification all bit more bit can go to little the context can little but a can the PSPSP in a you about you. point in how to engage speak earlier why the it can here you Thank scenarios and as context as there? this I time did to you to I Got well? to as provided give the a If know you I events bit that the back specific speak not PSPS into around difficult making

Chris Foster

Chris. This Julien. is Sure

consider safety commission of certificate it fairly set we I think the was would that evaluating apart. was as criteria itself. There the the straightforward certificate related separate largely a and to

different were general owned points weather up saw is gusts from what If at hour. miles with data Judge think situation the the Zogg this in shared what with have what I our stations vicinity terms there think that in three own there the were week you weather Alsup which in is around we the and fire, roughly were terms look that of publicly the stations around of certain speaking our sustained filing XX we in per miles That hour deviates to area at at generally I winds XX planning. an in you

number considerations meet power wind to ground areas that of not speeds fuels public humidity The in the from to you safety the in requirements well. shutoff approach a the did place. As in those relative of in wind different consists know speeds the have as general we moisture our

of winds of sustained that typically consider and miles customers XX exceedance as consider in terms when in per served hour could per those generally an speaking off terms miles are You purposes hour shutting XX we an roughly being area of by.

Julien Dumoulin-Smith

Thank for it. you that Got clarification.

the another if it squeeze but I in is obviously just market on I dynamic. for sorry Lastly, insurance can one

here. You've obtained more

perpetuate that year? Going it forward what of has necessarily which around the not this may in very as different here just elaborate avenues you year options the if intent your can quickly it are next

Chris Foster

Sure. fires storm, acknowledge elements. terms and in statewide Bill I heat, talked I guess with start as other of impacts would about year it's from to have the I been dramatic a pretty August

So before continue coverage a it's think cost reasonable obviously from we that achieved insurance Julian to year. think recovery this to is the of we evolve have terms in market's standpoint going what do I

think In probably are of year, there a few at play. I next things terms

year the we coverage state. Our the be price level AB components, what fund well our of multi-year from oversees to that understanding next for cost can customers. at contemplate the read as looking effective as be to most best coverage in plan the compete trying statute itself industrial to wildfire safety Absent we would contemplate explicit it the to the wildfire entity the possible for different everything as is the as structures the there utilities insurance some for administrator XXXX for guidance options a that of kind determine best we'd customers any certainly does

that year, the roughly total a of cost is this have total at this five to we billion million which wildfire at one comes of comprehensive coverage, $ million. for in So XXX stage do a of a five XXX for coverage

Julien Dumoulin-Smith

Thanks time. for that. all Appreciate the

Operator

Your of Wolfe line from from Research. comes question Steve next Fleishman a

line is open. Your

Steve Fleishman

Hi, good excuse me, morning.

I Just any victim the those any fund. terms going question plans what gotten basically shares the they you shares intentions for in on them of are and the plans on for a guess Have forward? from their fire own indication

Bill Smith

Hi, good morning Steve.

What in shares. of has We the we point. sold queue is XXth that that not the trust out see October the this any you'll that did our as point haven't at has information is company

that really update the is on for. that So

really them as around they're events about best make the I the obviously a think sure in that thinking this but how with do this given stage is speculate the help to fire we at of communicate can't on future. well substantial stage issuances aware shareholder the of company to trust at openly our share victims they're company

Steve Fleishman

all blacked were Okay. just or at not? Can clarify you out anything whether or they

Chris Foster

those things trust question do between very dynamics and it's Those registration so we you rights periods this the blackout for the we are information that the company the have think there and the trust. interests with provides forward the as an Certainly I that would are provisions about to at offering. undertake exchanges Steve, that victims’ not No, fair be but collaborate of rights agreement sure aligned in some should would attributes largely a really demand want be and going would other stage should public the think our unwritten fire trust they domain. appropriate with

Steve Fleishman

of We season do of have event, well of this events this I a Zogg and just issues. work you've in we've is obviously but this and well. you this can very PSPS question second Okay, events but of lot lot had most them know successful answer terms and avoiding done a several then how don't

is kind regulatory feedback there so just activities can you're your So on on you far? color getting political could give you, any of

Bill Smith

Hi is Steve. Bill Smith. the This for question. Thanks

has early nothing the that No facing speaking of but PG&E. and look seen I relatively see feedback a are you is number about good I've the think if general that as had from season generally in this, fact think far think to any this of so And and showed the something year. in of public broader season we that approaching of part and wildfires than had, of we I has is issue safety challenge been as the I kind I our this key nature X,XXX said of it to do public at been utilities stakeholders. state the think understand the recognize articles that this to fires kind have unfortunate much with do that some that has this us the likes people one California

think some hundred proactive and from likely that started we good would this event. into a of and over found like of cases in still events the been all a have well to feedback year latest of better not while year this steps well I we're had stakeholders executing have debris I challenge. implement or we the where some tallies a getting that So the doing a pretty there's other lines to that We've would the there PSPS key have final But our we've say things acceptance had taken this that from the the could fire. were nature been

is I to I that more the about think people communities. speaking but generally we've would point and of it's that safety issue got we're what think obviously out learn Zogg say the that and So doing working their the appreciate for you safety I

Steve Fleishman

Great.

important management last us probably we helpful? roles, these one on specifics any know three least I looking color very you you're quick the that going at some give these one, working of for you're just just Just different there roles are given these are color the at would that on. could people types or to hires know people give obviously can't on but be

Bill Smith

to specifics, commitment I we're what operational any giving detailed say safety and looking is would without Well a operational I with think effectiveness excellence. strong people experience for Yes. and and basically

is how along. coming at whole pleased process that really I'm So

tuned, very stay but just plan. quite along it's come well our much and to So according

Steve Fleishman

you. Great. Thank

Operator

Jonathan next Your the Research. question line from of Vertical comes Arnold from

is line Your open.

Jonathan Arnold

the this you're settlement the Hi cap good of assume I CPUC with forward. morning to guys. slides one But sort sort from just the getting of sticking of of is structure return going and Quick question looks hypothetical guidance it feature the on the this cap across on TOXX the structure. rule thumb think as learn how to see though end. that you're and here modeling about

some we you within suggesting of have it of just fit the sort this or how within general approached could there embedded there sort curious is whether tolerance? were whether before help So versus

Chris Foster

know I it It's the on way, this we've is but focus consistent elements the assumption that has unique Jonathan. would called thing TOXX some I question. at Thanks stage that to that case for out. the the the

I specifically at factors look think waiver you'd AFUDC to the our at If because want piece stage. the focus that's this XXXX you on

elements other to changing straightforward we fairly are not relative you. before were The they're where

final accounting out swing probably You'd we think that roughly be staff staff our to piece by a way we'll turns out of reasonably the FERC by end have the is that want how about but handled year. depending that Jonathan on waiver it's general $X.XX that that accounting FERC implies looking and helpful to a here if we you'd AFUDC be at as assumption the think call view the

Jonathan Arnold

looking better. retroactive not or on it applying ongoing Actually to variance to that up looking impact I'm but earnings an that might that Does it want understand have back I be sounded did sure. like more follow

Chris Foster

be It'd back Jonathan. looking

Jonathan Arnold

Okay.

just of ultimately that really what doesn't So the for swing terms about that right? a you're but in talking Is factor earnings book trajectory. change $X.XX is core as would XX you

Chris Foster

it anticipate specifically that's it if where be the to assumption would an called to so in just impact clear Jonathan, out were XXXX So direction. as we we go in different a

Jonathan Arnold

power going XXXX? Without change would forward a earnings that direction impact go or in Okay. with just the different

Chris Foster

It would impact to an XXXX. confined be

Jonathan Arnold

Okay.

you was total this just data know the what on ended one and point up Is gave that thing think XXX you cost. I us I So insurance incremental a paying on just for million? there it

Chris Foster

do No. bit the appreciate of There because of there's is quite not I question the the a been focus component specifically coverage on wildfire Jonathan. itself.

ultimately that We the we'll haven't the and that decision provided land any additional certainly with examine in we have final color hope continue reflected generate at overlaps I this stage. the discussion recovery agreement. Again XXXX as there do their that's the CPUC this at place at in we settlement we commission decision the could at case this cost in proposed imagine where language our stage.

Jonathan Arnold

Okay. very Thank much Chris. you

Operator

next question Lapides of from from line Michael Your Sachs. the comes Goldman

open. is line Your

Michael Lapides

drive would about state just walk question. could a be flow for to income guys taking Hi XXXX/XXXX think you drivers? lots are just direct but there little just [indiscernible] probably won't for trying in to you, more some my stable these may curious you cash necessarily kind versus a pretty inflows one's us cash have that for income of sources statement through get statement because thank this and I'm that significant things be that cash starting to are of FEMA Chris inflow of of lead those and impact the can material items bit

Chris Foster

Sure Michael. Good morning.

different you be it's have you I about it it want up. at well think our we on number. as in them I is stacking I in way could disclosures have memorandum think this been off say call I to the queue, look multiple if out but accounts that the

be to I $X.X but building to going roughly I'm $X it in been to up. think was billion having billion So the generic, neighborhood

accounts planning is. think a where few for the focus quarters. that's back though step and recovery cost been memorandum are Ultimately around I you So mechanisms if your these something we've

that change the to came implying exists it it's see for for those any to that example, out start a that future ultimately FEMA We would it contemplate wouldn't think there's behind of with I company Californians relief mechanism fairly you those any for financing broken of wouldn't as see plan of impacting cost because that recovery were if think be kind I interim sits through So recoveries that as been pleased the traditional straightforward it accelerated kind the about really for necessarily some you but support Michael, request that lag financing. otherwise regulatory rate we of years.

Michael Lapides

think five it. you your the about level bill at couple three the could what’s over the then anticipate you guys going can the Can you just you next of what in you next of to bill, to inflation item talk four years. Got over to directionally think happen And look three years last place years bill customer plan? do

Chris Foster

Sure.

So I bit question. good Michael a back a stepping think it's

mitigate wildfire straightforward. it's have terms in to risk. plan We needed investments of substantial company's the actually pretty But

proceeding, We at good which next the years the of combination to case look in and examples. GTNF, pretty that us three like to those line gives for have of cost most least now that's the case sight going the what of the and a generate our capital really TOXX of

of of our that three to electric at impacts start line growth X% us you with customers year bundled at north in rate looking look roughly state. average our system in to four kind generally to that puts As just generally average five range projections we're for speaking speaking

and serve think well. imagine exists do economic as look to the fortunate I that we another the very way there's that here can it are area and at as we We diversity you

the range we're generally rates different base California We more next the valley our also wallet few the in and growth contemplate years. We who northern relates it these coastal and those may the California the a at that's to communities of of that of that for live customers. from temperate to very so speaking looking as areas in for customers share acknowledge percent in is customer moderate central

Michael Lapides

inflation? And bill of there any are major think cost you finally could that offset where some areas savings you

Bill Smith

is Thanks. This Bill.

there's do wouldn't I as there say after the to some major a the as XXXX opportunities When get think events very could. we place, of efforts. think resources a we of XXXX, contracting attempt aggressive our on areas. there ground was to we started and many lot there given that are lot taking a but I from of can approach we of that a are

at and effectively. are there come ways to for think us I more that back look

an one some think is I about things that the of kicking our process I of improvements. excited around I'm off that point issue operational the about we're made

effective do, a what lot time, ways at are much reduce things. we there which can take think out get inventory I time that of reduces more needs lost we cycle

broad a can that it's the think costs I or items. of of range out get individual us So help areas not one any two business

Michael Lapides

you Much Got it. Thank guys. appreciated.

Operator

of [indiscernible] from [Operator Security. Instructions] Jeremy comes next line Your JP the question Morgan

Your line is open.

Unidentified Analyst

our taking Hi Rich This is good for Jeremy. for Thanks questions. on morning.

start a the to the you of magnitude little how rates? provide this these to prior with circling few over initiatives and sort the customer alluded want off question. earlier Just maybe next the impact of COVID of call that earnings you bit more years around back with enterprise-wide driving versus offsetting on Could fits

Chris Foster

Jeremy. Sure

look different few a ways there's to at So it.

I think think, you're stepping this. of sure want and I to a I I'm kind responsible contemplate back categories interested in to are way what be as

specific would benefits to to categories impacting would others more Some customers. be be earnings

we're about to we've of searching sure energy savings cost we're years, make business few that in the competitive As behalf those always we things some of look of the talked credits. categories to side look on for customers. next you that include like at kind Anytime forward the energy of way, renewable

think I you see would to accrue there benefits customers. would So that

of of those number We there's customers. to a in also assets back also area largely evaluate there. where continue there those Many if to developed benefits a would additional property surplus accrue cases similar treatment

time that and with as about kind as to to case that's as COVID-XX conversation really primary of future well the is future our can think company. evolving Oakland You well. real footprint of impacts the how we headquarters the in the imagine look at there the state of move moving our Obviously and

us you terms of being will cost think return think to improvement these Bill we've the other XXXX. guided of achieving ultimately future some could in that elements we process for there, going but that work in to, I authorized in us a savings As of our alluded split see to forward see a allow about as driver we that as earn

Unidentified Analyst

financial given then plan elections now can and rates the just around your sensitive tax current any the increase? provide Great. right thoughts Thank on you you focus and early issue corporate

Bill Smith

Sure. Thank Rich. you

and think limited I see in be of short there. Sorry, a the NOLs a it's impacts there you'll because PG&E should the least for tax in policy I company limited should think at terms there if that change change substantial of be has

Unidentified Analyst

very Thank it. you Got much.

Bill Smith

you. Thank

Operator

Your next the Citi. question from of line Levine from comes Ryan

line open. Your is

Ryan Levine

you, and what's your us proceeds? Good the non-core you between color sell ratepayers is it? and picture sorry, remind on morning. assets can Can more the sharing potential company the mechanism starting Any to shareholders on the

Chris Foster

and I'm question forthcoming than the really appreciate I Ryan. able Sure not be to more that. much

what some quarter’s there are we we right non-core I evaluate to think were that small really where and it's last really doing work emphasized we're assets now evaluating. the internal

back If you I'll about call asset different ways. and different what step just classes different which think asset classes you in are about think can

that the in is footprint the areas. company different that One of have which physical owns the land we

not. Generally some that one sale differ is is as example. treatment of Some crew depending which any the on of benefits speaking from will of which developed, the

we so As where different you the are this asset look think there treatment I focused other on stage could classes this gain opportunities slightly across very at do sale progress but be at otherwise don't effort. and doing in specific stage. different on is be to make want to get a our later don't want of of because too to work continue be can I kind we'd outreach ahead any internal we

Ryan Levine

estimate? higher estimate additional further change current there assumptions report received that what you're any this revisions anticipating and that the may Thanks haven't changes fire given and that Cal changing that at information we you gears are then drove the see

Bill Smith

Ryan. Sure

you we So particular provided is to our this segregation can this data the have California the and with we wildfires imagine means having to had over conversations to at by claims one recall relates passage level us we recall and noted we're a data which segregation had allowed have you of time better prior situation before may just information with different some and an the what getting additional us what really were than accrual stage At referenced, in greater element years we of the it in time. prior, disclosed had office as claims as particular have entities stage. in prior granularity In as as update this we themselves you this input. insurance of of with which now improved that better

Ryan Levine

you. Thank Okay.

Bill Smith

Thank you.

Operator

this questions at There are time. no further

Matt Putnam

all joining and your the Well call interest thank in you PG&E thank on you us for for today.

hesitate questions If you have you. any Thank please follow-up reach to relations. out to don't investor

Operator

you call. and for this concludes conference Ladies Thank gentlemen today's participating.

disconnect. You may now

Matt Putnam	Senior Director, IR
Bill Smith	Interim CEO
Chris Foster	VP & Interim CFO
John Simon	EVP, General Counsel and Chief Ethics & Compliance Officer
Michael Lewis	Interim President of Pacific Gas and Electric Company
Robert Kenney	VP of Regulatory and External Affairs.
Julien Dumoulin-Smith	Bank of America
Steve Fleishman	Wolfe Research
Jonathan Arnold	Vertical Research
Michael Lapides	Goldman Sachs
Ryan Levine	Citi

PG&E (PCG) 30 Oct 202020 Q3 Earnings call transcript