Company: PCG-PB
Filing Date: 2025-10-23
Form Type: 10-Q
Source: 0001004980-25-000148
Chunk: 126

Company: PG&E Corp
Filing Date: 2025-10-23
Form: 10-Q
Item: Item 1A
Chunk 126
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•The Timing and Outcome of Ratemaking and Other Proceedings.  Regulatory ratemaking proceedings are a key aspect of the Utility’s business.  The Utility’s revenue requirements consist primarily of a base amount set to enable the Utility to recover its reasonable operating expenses (e.g., maintenance, administrative and general expenses) and capital costs (e.g., depreciation and financing expenses).  The CPUC also authorizes the Utility to collect revenues to recover costs that the Utility is allowed to pass through to customers, including its costs to procure electricity and natural gas for customers and to administer public purpose and customer programs.  Although the Utility generally seeks to recover its recorded costs on a timely basis, in recent years, the amount of the costs recorded in memorandum and balancing accounts has increased.  Other proceedings that could impact the Utility’s business profile and financial results include actions by municipalities and other public entities to acquire the electric assets of the Utility within their respective jurisdictions.  The outcome of regulatory proceedings can be affected by many factors, including intervening parties’ testimonies, potential rate impacts, the regulatory and political environments, and other factors.  See Notes 3 and 11 of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1, and “Regulatory Matters” below.

•PG&E Corporation’s and the Utility’s Ability to Control Operating and Financing Costs.  Under cost-of-service ratemaking, a utility’s earnings depend on its ability to manage costs within the amounts authorized for recovery in its ratemaking proceedings.  The Utility has set a long-term goal to increase its capital investments to meet safety and climate goals, while also achieving operating cost savings.  The Utility intends to achieve such savings by improving the planning and execution of its business through increased efficiencies, including waste elimination through the Lean operating system.  PG&E Corporation and the Utility also work to reduce financing costs by identifying and executing on opportunities to efficiently finance the business, which depends on capital market conditions.  Increased volatility in capital markets and elevated interest rates may impact PG&E Corporation’s and the Utility’s ability to obtain financing on acceptable terms or raise the cost of financing, which in turn may negatively impact their financial results.

For more information about the risks that could materially affect PG&E Corporation’s and the Utility’s financial condition, results of operations, liquidity, and cash flows, or that could cause future results to differ materially from historical results, see Item 1A: “Risk Factors” in the 2024 Form 10-K and “Forward-L