Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, NY 10153-0119

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WEIL, GOTSHAL & MANGES LLP

Stephen Karotkin (pro hac vice) 

(stephen.karotkin@weil.com) 

Ray C. Schrock, P.C. (pro hac vice) 

(ray.schrock@weil.com) 

Jessica Liou (pro hac vice) 

(jessica.liou@weil.com) 

Matthew Goren (pro hac vice) 

(matthew.goren@weil.com) 

767 Fifth Avenue 

New York, NY 10153-0119 

Tel: 212 310 8000 

Fax: 212 310 8007 

KELLER & BENVENUTTI LLP 

Tobias S. Keller (#151445) 

(tkeller@kellerbenvenutti.com) 

Jane Kim (#298192) 

(jkim@kellerbenvenutti.com) 

650 California Street, Suite 1900 

San Francisco, CA 94108 

Tel: 415 496 6723 

Fax: 650 636 9251 

Attorneys for Debtors and Debtors in Possession 

UNITED STATES BANKRUPTCY COURT 

NORTHERN DISTRICT OF CALIFORNIA 

SAN FRANCISCO DIVISION 

In re: 

PG&E CORPORATION,

 - and - 

PACIFIC GAS AND ELECTRIC 

COMPANY,

Bankruptcy Case No. 19-30088 (DM)

Chapter 11 (Lead Case) (Jointly Administered) 

APPLICATION PURSUANT TO 11 U.S.C. §§ 327 

AND 328 FOR AN ORDER AUTHORIZING 

EMPLOYMENT AND RETENTION OF 

DELOITTE & TOUCHE LLP AS 

INDEPENDENT AUDITOR AND ADVISOR TO 

THE DEBTORS NUNC PRO TUNC TO THE 

PETITION DATE 

Date: June 12, 2019 

Time: 9:30 a.m. (Pacific Time) 

Place: United States Bankruptcy Court 

 Courtroom 17, 16th Floor 

 San Francisco, CA 94102 

Objection Deadline: June 5, 2019 

 4:00 p.m. (Pacific Time)

Debtors.

 Affects PG&E Corporation 

 Affects Pacific Gas and Electric 

Company 

 Affects both Debtors 

* All papers shall be filed in the Lead 

Case, No. 19-30088 (DM). 

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PG&E Corporation (“PG&E Corp.”) and Pacific Gas and Electric Company (the “Utility”), as 

debtors and debtors in possession (collectively, “PG&E” or the “Debtors”) in the above-captioned 

chapter 11 cases (the “Chapter 11 Cases”), hereby submit this Application (the “Application”), 

pursuant to sections 327 and 328 of title 11 of the United States Code (the “Bankruptcy Code”) and 

Rules 2014(a) and 2016 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”), for 

authority to retain and employ Deloitte & Touche LLP (“Deloitte & Touche”) as independent auditor 

and advisor to the Debtors effective as of the Petition Date (as defined below) in accordance with the 

terms and conditions set forth in the Engagement Agreements (as defined below). 

In support of this Application, the Debtors submit the Declaration of Timothy Gillam, a partner 

of Deloitte & Touche (the “Gillam Declaration”), filed concurrently herewith. Copies of the 

Engagement Agreements are annexed as exhibits to the Gillam Declaration. A proposed form of order 

approving the retention and employment of Deloitte & Touche is annexed hereto as Exhibit A

(the “Proposed Order”).

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MEMORANDUM OF POINTS AND AUTHORITIES

I. JURISDICTION

The Court has jurisdiction to consider this matter pursuant to 28 U.S.C. §§ 157 and 1334, the 

Order Referring Bankruptcy Cases and Proceedings to Bankruptcy Judges, General Order 24 (N.D. 

Cal.), and Rule 5011-1(a) of the Bankruptcy Local Rules for the United States District Court for the 

Northern District of California (the “Bankruptcy Local Rules”). This is a core proceeding pursuant to 

28 U.S.C. § 157(b). Venue is proper before the Court pursuant to 28 U.S.C. §§ 1408 and 1409. 

II. BACKGROUND

On January 29, 2019 (the “Petition Date”), the Debtors commenced with the Court voluntary 

cases under chapter 11 of the Bankruptcy Code. The Debtors continue to operate their businesses and 

manage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy 

Code. No trustee or examiner has been appointed in either of the Chapter 11 Cases. The Debtors’ 

Chapter 11 Cases are being jointly administered for procedural purposes only pursuant to Bankruptcy 

Rule 1015(b).

On February 12, 2019, the United States Trustee (the “U.S. Trustee”) appointed an Official 

Committee of Unsecured Creditors (the “Creditors Committee”). On February 15, 2019, the U.S. 

Trustee appointed an Official Committee of Tort Claimants (the “Tort Claimants Committee” and, 

together with the Creditors Committee, the “Committees”).

Additional information regarding the circumstances leading to the commencement of the Chapter 

11 Cases and information regarding the Debtors’ businesses and capital structure is set forth in the 

Amended Declaration of Jason P. Wells in Support of the First Day Motions and Related Relief [Docket 

No. 263] (the “Wells Declaration”).

III. DELOITTE & TOUCHE’S QUALIFICATIONS

Deloitte & Touche is a public accounting firm with offices across the United States. Deloitte & 

Touche has significant experience in providing accounting and advisory services for debtors in many 

large and complex chapter 11 cases. See, e.g., In re Sears Holdings Corporation, Case No. 18-23538 

(RDD) (Bankr. S.D.N.Y. Jan. 22, 2019); In re Tops II Holding Corp., Case No. 18-22279 (RDD) (Bankr. 

S.D.N.Y. May 10, 2018); Westinghouse Elec. Co., LLC, Case No. 17-10751 (MEW) (Bank. S.D.N.Y. 

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Nov. 16, 2017) (ECF No. 1585); In re Sabine Oil & Gas Corp., Case No. 15-11835 (SCC) (Bankr. 

S.D.N.Y. Oct. 16, 2015) (ECF No. 425). Such experience renders Deloitte & Touche well-qualified and 

able to provide services to the Debtors during the pendency of these chapter 11 cases. Deloitte & 

Touche’s services fulfill an important need and are not provided by any of the Debtors’ other 

professionals.

In addition, since approximately February 1999, Deloitte & Touche has provided professional 

services to the Debtors. In providing such prepetition professional services to the Debtors, Deloitte & 

Touche is familiar with the Debtors and their business, including the Debtors’ financial affairs, debt 

structure, operations, and related matters. Having worked with the Debtors’ management, Deloitte & 

Touche has developed relevant experience and knowledge regarding the Debtors that will assist it in 

providing effective and efficient services during these cases. Accordingly, Deloitte & Touche is both 

well-qualified and able to provide the services for the Debtors in the chapter 11 cases in an efficient and 

timely manner.

IV. SCOPE OF SERVICES

Pursuant to the terms and conditions of the following agreements (collectively, the “Engagement 

Agreements”), the Debtors seek to retain Deloitte & Touche to provide independent audit and advisory 

services (the “Services”), as follows:1

(i) Base Audit Engagement Letters. Pursuant to the terms of those certain 

engagement letters, dated February 16, 2018 (the “2018 Base Audit Engagement 

Letter”) and February 19, 2019 (the “2019 Base Audit Engagement Letter” and, 

together with the 2018 Base Audit Engagement Letter, the “Base Audit 

Engagement Letters”), Deloitte & Touche will perform an integrated audit of the 

Debtors in accordance with the standards of the Public Company Accounting 

Oversight Board (PCAOB) (United States) (the “PCAOB Standards”). Deloitte 

& Touche will express opinions on (1) the fairness of the presentation of the 

Debtors’ consolidated financial statements for the year ended December 31, 2018 

and the year ending December 31, 2019, as applicable, in conformity with 

accounting principles generally accepted in the United States of America 

(“generally accepted accounting principles”), and (2) the effectiveness of the 

Debtors’ internal control over financial reporting as of the applicable year ended 

 1 The summary of the Engagement Agreements included in this Application is provided for purposes of 

convenience only and is qualified in its entirety by reference to the Engagement Agreements. To the 

extent that this Application and the terms of a particular Engagement Agreement are inconsistent, the 

terms of the Engagement Agreements shall control. 

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periods. 

(ii) Trust Audit Engagement Letter. Pursuant to the terms of that certain engagement 

letter, dated February 19, 2019, for the audit of the respective financial statements 

of certain trusts of the Utility for the year ended December 31, 2018 (the “Trust 

Audit Engagement Letter”), Deloitte & Touche will perform audit services, as 

contemplated therein, for the Nuclear Facilities Non-Qualified CPUC 

Decommissioning Master Trust, the Nuclear Facilities Qualified CPUC 

Decommissioning Master Trust, and the Nuclear Facilities Qualified FERC 

Decommissioning Master Trust of the Utility, and express opinions on the fairness 

of the presentation of the applicable entity’s financial statements for the year ended 

December 31, 2018, in conformity with generally accepted accounting principles. 

(iii) Lease Accounting Engagement Letter. Pursuant to the terms of that certain 

engagement letter, dated February 22, 2018 (the “Lease Accounting Engagement 

Letter”), Deloitte & Touche will assess the internal controls and processes of 

PG&E Corp. and its subsidiaries in preparation for PG&E Corp’s planned changes 

in information systems and related business processes for the PowerPlant Lease 

Accounting module (“lease accounting system”), which is a new software module 

designed to implement a new accounting standard (ASU No. 2016-02, Leases), and 

provide advice and recommendations regarding the transition to and 

implementation of the lease accounting system. 

V. NO DUPLICATION OF SERVICES

The Debtors intend that the services of Deloitte & Touche will complement, and not duplicate, 

the services being rendered by other professionals retained in these Chapter 11 Cases. Deloitte & Touche

understands that the Debtors have retained and may retain additional professionals during the term of 

the engagement. The Debtors plan to retain KPMG LLP for information technology, risk, and forensic 

technology services and PricewaterhouseCoopers LLP as the Debtors’ management, tax and advisory 

consultants. Deloitte & Touche will be providing distinct audit and advisory services and will work 

cooperatively with the Debtors to avoid unnecessary duplication of services.

VI. DELOITTE & TOUCHE’S DISINTERESTEDNESS

To the best of the Debtors’ knowledge, information, and belief, the members, partners, principals 

and professionals assigned to this case by Deloitte & Touche do not have any connection with or any 

interest adverse to the Debtors, their creditors, or any other party in interest, except as may be set forth 

in the Gillam Declaration.

Based upon the Gillam Declaration, the Debtors submit that Deloitte & Touche is a “disinterested 

person” as that term is defined in section 101(14) of the Bankruptcy Code, as modified by section 

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1107(b) of the Bankruptcy Code. The Debtors have been informed that Deloitte & Touche will conduct 

an ongoing review of its files to ensure that no disqualifying circumstances arise. If any new relevant 

facts or relationships are discovered, Deloitte & Touche will supplement its disclosure to the Court. 

In the ninety (90) days before the Petition Date, the Debtors paid Deloitte & Touche

approximately $2,277,600 for services rendered. As of the Petition Date, Deloitte & Touche was not 

owed any amounts under invoices for professional services rendered prior to such date. 

VII. PROFESSIONAL COMPENSATION

As set forth in the Gillam Declaration, Deloitte & Touche will apply to the Court for allowances 

and reimbursement of expenses in accordance with the applicable provisions of the Bankruptcy Code, 

the Bankruptcy Rules, the Bankruptcy Local Rules, the United States Bankruptcy Court Northern 

District of California Guidelines for Compensation and Expense Reimbursement of Professionals and 

Trustees, effective February 19, 2014 (the “Local Guidelines”), the U.S. Trustee Guidelines for 

Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. § 330, 

effective January 30, 1996 (the “U.S. Trustee Guidelines,” and together with the Local Guidelines, the 

“Fee Guidelines”), the Amended Order Implementing Certain Notice and Case Management 

Procedures [Docket No. 1093], and any further Orders of the Court in these Chapter 11 Cases regarding 

professional compensation and reimbursement of expenses (the “Orders”).

Subject to the provisions of the Bankruptcy Code, the Bankruptcy Rules, the Bankruptcy Local 

Rules, the Fee Guidelines, and the Orders, the Debtors propose to compensate Deloitte & Touche as 

contemplated in the Engagement Agreements on either an hourly or fixed-fee basis. 

A. 2018 Base Audit Engagement Letter:

As of the Petition Date, Deloitte & Touche had received payment in full for services performed 

under the 2018 Base Audit Engagement Letter. Deloitte & Touche has been performing services under 

the 2018 Base Audit Engagement Letter during these Chapter 11 Cases but does not intend to bill the 

Debtors for any fees in connection with such services, and accordingly, such services will not be included 

in any fee application submitted by Deloitte & Touche in these cases.

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B. 2019 Base Audit Engagement Letter

Pursuant to the 2019 Base Audit Engagement Letter, Deloitte & Touche agreed to bill the Debtors 

periodically with respect to the audit services performed thereunder, except for Out-of-Scope Services 

(as defined below). Deloitte & Touche will bill its fees for the audits of each Debtors’ financial 

statements, the reviews of the related interim financial information, the audits of each Debtor’s internal 

control over financial reporting, and the Utility’s FERC Form 1 audit for the year ending December 31, 

2019 at the hourly rates set forth in the table below.

Under the terms of the 2019 Base Audit Engagement Letter, the Debtors may request additional

services that were not contemplated as part of the base audit, but that were pre-approved by the parties 

(collectively, the “Out-of-Scope Services”), as follows:

(i) Accounting consultations on accounting and financial reporting matters, which are 

pre-approved for the year ending December 31, 2019 up to $25,000 for PG&E 

Corp. and up to $75,000 for the Utility. 

(ii) The issuance of a (1) “comfort letter” related to anticipated offerings of debt or 

equity during 2019, which are will be $45,000 per letter; or (2) consent letter for 

the reissuance of reports during 2019, which will be $25,000 each time a consent 

is required. 

(iii) Out-of-scope audit procedures (including services provided in connection with 

statutory or regulatory filings, engagements and regulatory reviews of audit 

workpapers, specific transactions/accounting, reporting on critical audit matters, 

adoption of new accounting pronouncements, internal controls surrounding new 

applications, systems or activities, and changes in laws or regulations in the current 

year), which will be billed based on the time spent on such services at the rate of 

the professional performing the service, as noted in the table below.

(iv) Other audit-related services (including agreed-upon procedures, advice and 

recommendations regarding proposed transactions, adoption of new accounting 

pronouncements, internal controls surrounding new applications, systems or 

activities, and training in a future year), which will be billed based on the time spent 

on such services at the applicable rate of the professional performing the services, 

as noted in the table below.

Professional Level

Hourly Rates

for 2019 Base 

Audit

Hourly Rates 

for Out-ofScope Services 

Partner / Principal / Managing Director $380 $760

Senior Manager $330 $660

Manager $290 $580

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Senior $230 $460

Staff $200 $390

Junior Staff $180 N/A

C. Trust Audit Engagement Letter:

Pursuant to the terms of the Trust Audit Engagement Letter, Deloitte & Touche agreed to bill the 

Debtors periodically with respect to the services performed thereunder. The fees for such services will 

be $63,000, plus expenses.

D. Lease Accounting Engagement Letter:

Pursuant to the terms of the Lease Accounting Engagement Letter, Deloitte & Touche agreed to 

bill the Debtors based on the actual time spent by professionals on such services at the individual’s 

applicable professional hourly rate. Deloitte & Touche will charge the Debtors the following hourly

rates with respect to such services:

Professional Level Hourly Rates

Partner / Principal / Managing Director $365 

Senior Manager $325

Manager $295

Senior $265

Staff $225

In addition to the fees set forth above, the Debtors have agreed to compensate Deloitte & Touche 

for engagement-related expenses, including travel, report production, delivery services, and other 

expenses incurred by Deloitte & Touche in providing the services.

The Debtors understand it is not the practice of Deloitte & Touche’s professionals to keep 

detailed time records in one-tenth-of-an-hour increments (i.e., six minute increments) as customarily 

kept by attorneys who are compensated subject to approval of the Bankruptcy Court. Thus, Deloitte & 

Touche requests that this Court allow Deloitte & Touche’s professionals to provide the following in its 

monthly, interim, and final fee applications: (a) a narrative summarizing each project category and the 

services rendered under each project category; (b) as an exhibit to each monthly, interim, and final fee 

application that Deloitte & Touche files in these Chapter 11 Cases, a summary, by project category, of 

services rendered to the Debtors, which identifies each professional rendering services, the number of 

hours expended by each professional, and the amount of compensation requested with respect to the 

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services rendered by each professional; and (c) reasonably detailed records of time in half-hour 

(0.5) increments, describing the services rendered by each professional and the amount of time spent on 

each date.

The Debtors respectfully submit that Deloitte & Touche’s rates and policies stated in the Gillam

Declaration are reasonable, particularly given the nature of these Chapter 11 Cases. 

VIII. INDEMNIFICATION

As part of the overall compensation payable to Deloitte & Touche under the terms of certain of 

the Engagement Agreements, the Debtors have agreed to certain indemnification obligations as 

described in such Engagement Agreements. The terms of the Engagement Agreements and the 

indemnification provisions contained therein were fully negotiated in good faith and at arm’s length. 

Deloitte & Touche, in connection with its retention in these Chapter 11 Cases, has agreed to certain 

modifications of the indemnification provisions, as included in the Proposed Order. 

IX. BASIS FOR RELIEF REQUESTED

The Debtors seek authority to employ and retain Deloitte & Touche as independent auditor and 

advisor under section 327 of the Bankruptcy Code, which provides that a debtor is authorized to employ 

professional persons “that do not hold or represent an interest adverse to the estate, and that are 

disinterested persons, to represent or assist the [debtors] in carrying out the [debtors’] duties under this 

title.” 11 U.S.C. § 327(a). Section 1107(b) of the Bankruptcy Code elaborates upon sections 101(14) 

and 327(a) of the Bankruptcy Code in cases under chapter 11 of the Bankruptcy Code and provides that 

“a person is not disqualified for employment under section 327 of [the Bankruptcy Code] by a debtor in 

possession solely because of such person’s employment by or representation of the debtor before the 

commencement of the case.” 11 U.S.C. § 1107(b).

The Debtors further seek approval of the fixed-fee portion of the Engagement Agreements

pursuant to section 328(a) of the Bankruptcy Code, which provides, in relevant part, that the Debtors,

“with the court’s approval, may employ or authorize the employment of a professional person under 

section 327 . . . on any reasonable terms and conditions of employment, including on a retainer, on an 

hourly basis, on a fixed or percentage fee basis, or on a contingent fee basis.” 11 U.S.C. § 328(a). 

Accordingly, section 328 of the Bankruptcy Code permits the compensation of professionals on flexible 

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terms that reflect the nature of their services and market conditions. The Debtors believe that the fixedfee portion of the Engagement Agreements provide for reasonable terms and conditions of employment, 

comparable to other leading consulting firms and, thus, should be approved under section 328(a) of the 

Bankruptcy Code (except that the U.S. Trustee may review such compensation under sections 330 and 

331 of the Bankruptcy Code). Accordingly, the Debtors submit that the relief requested in this 

Application is in the best interests of the Debtors’ estates, creditors, and all parties in interest to these 

Chapter 11 Cases.

X. NOTICE

Notice of this Application will be provided to (i) the Office of the U.S. Trustee for Region 17 

(Attn: Andrew R. Vara, Esq. and Timothy Laffredi, Esq.); (ii) counsel to the Creditors Committee; (iii) 

counsel to Tort Claimants Committee; (iv) the Securities and Exchange Commission; (v) the Internal 

Revenue Service; (vi) the Office of the California Attorney General; (vii) the California Public Utilities 

Commission; (viii) the Nuclear Regulatory Commission; (ix) the Federal Energy Regulatory 

Commission; (x) the Office of the United States Attorney for the Northern District of California; (xi) 

counsel for the agent under the Debtors’ debtor in possession financing facility; and (xii) those persons 

who have formally appeared in these Chapter 11 Cases and requested service pursuant to Bankruptcy 

Rule 2002. The Debtors respectfully submit that no further notice is required.

No previous request for the relief sought herein has been made by the Debtors to this or any other 

Court.

WHEREFORE the Debtors respectfully request entry of an order granting (i) the relief requested 

herein as a sound exercise of the Debtors’ business judgment and in the best interests of their estates, 

creditors, shareholders, and all other parties interests, and (ii) such other and further relief as the Court 

may deem just and appropriate.

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Dated: May 22, 2019

WEIL, GOTSHAL & MANGES LLP

KELLER & BENVENUTTI LLP

By: /s/ Stephen Karotkin

Stephen Karotkin

Attorneys for Debtors

and Debtors in Possession

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