Company: PCG-PB
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0001004980-25-000010
Chunk: 106

Company: PG&E Corp
Filing Date: 2025-02-13
Form: 10-K
Item: Item 1
Chunk 106
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 a given year but also provides for an annual update of the previous year’s revenue requirement and rates in accordance with the terms of the FERC-approved formula.  Under the formula rate mechanism, transmission revenue requirements are updated to the actual cost of service annually as part of the true-up process.  Differences between amounts collected and determined under the formula rate are either collected from or refunded to customers.  The FERC typically authorizes the Utility to charge new rates based on the requested revenue requirement, subject to refund, before the FERC has issued a final decision.  The Utility bills and records revenue based on the amounts requested in its rate case filing and records a reserve for its estimate of the amounts that are probable of refund.  These FERC-approved rates are included by the CPUC in the Utility’s retail electric rates and by the CAISO in its transmission access charges to wholesale customers.  For more information, see “Regulatory Matters - Transmission Owner Rate Cases” in Item 7. MD&A.  The Utility also recovers a portion of its revenue requirements for its wholesale electric transmission costs through charges collected under specific contracts with wholesale transmission customers that the Utility entered into before the CAISO began its operations.  These wholesale customers are charged individualized rates based on the terms of their contracts.

Program-Specific Memorandum Account and Balancing Account Costs

Periodically, costs arise outside of the CPUC’s GRC proceedings or that have been deliberately excluded from such proceedings.  These costs may result from catastrophic events, changes in regulation, new programs, or extraordinary changes in operating practices.  The Utility may seek authority to track incremental costs in a memorandum account, and the CPUC may authorize recovery of costs tracked in memorandum accounts if the costs are deemed reasonable.  For instance, these accounts allow the Utility to track the costs associated with work related to disaster and wildfire response, and other wildfire prevention-related costs.  Recovery of the costs tracked in these memorandum accounts through rates requires CPUC authorization in separate proceedings, the outcome of which the Utility may be unable to predict.  Alternatively, the Utility may seek authority to track incremental costs related to these non-GRC programs in balancing accounts.  The CPUC may authorize recovery of costs tracked in the balancing accounts on either a “one-way” basis, which typically only allows actual costs to be recovered up to a pre-established cap, or a “two-way” basis, which typically allows actual costs to be recovered, and in some cases subject to further CPUC review.  For more information, see