NOTICE OF PACIFIC GAS AND ELECTRIC COMPANY’S REQUEST TO INCREASE RATES FOR ITS 2022 COST OF CAPITAL APPLICATION (A.21-08-015)

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NOTICE OF PACIFIC GAS AND ELECTRIC COMPANY’S REQUEST TO INCREASE RATES FOR ITS 2022 COST OF CAPITAL APPLICATION (A.21-08-015)

Why am I receiving this notice?

On August 23, 2021, PG&E filed its Cost of Capital (COC) application with the California Public Utilities Commission (CPUC). The “cost of capital” is the financial rate of return on invested capital that PG&E collects on its capital assets used to provide safe and reliable service. Capital assets include, but are not limited to, electric distribution poles and wires, natural gas pipelines, utility owned power plants, and information technology systems. In this application, PG&E is requesting to establish its authorized cost of capital for utility operations for the year 2022.

If the CPUC approves this application, it would result in a COC of 7.72%, an increase of 0.38%.

In total, the proposed changes in the COC application would increase PG&E’s current authorized revenues by $260 million (1.35%). If approved, PG&E’s request would become effective beginning January 1, 2022.

Why is PG&E requesting this rate increase?

PG&E’s proposal seeks to address the extraordinary impacts the COVID-19 pandemic and related government spending has had on utility financing. Utilities like PG&E fund the upfront costs of its capital assets with corporate loans (Long-term Debt) and equity/stock (Common Equity and Preferred Stock). PG&E then recovers its capital costs through customer rates over long periods of time, which for many capital assets, spans multiple decades. If approved, this request helps ensure that PG&E can remain competitive in the capital markets in securing the financing necessary to continue providing safe and reliable gas and electric service to its 16 million customers.

How could this affect my monthly electric rates?

Many customers receive bundled electric service from PG&E, meaning they receive electric generation, transmission and distribution services.

Based on rates currently in effect, the bill for a typical nonCARE bundled residential customer using 500 kWh per month would increase from $139.68 to $141.18, or 1.1%. For a typical CARE customer with a monthly usage of 500 kWh, the electric bill would increase from $89.86 to $90.84, or 1.1%.

Direct Access (DA) and Community Choice Aggregation (CCA) customers only receive electric transmission and distribution services from PG&E. These customers also receive the benefit of the California Climate Credit. In addition, eligible nonresidential DA and CCA customers receive the benefit of the greenhouse gas allowance returns. On average, these customers would see an increase of 1.4%.

Another category of nonbundled customers is Departing Load. These customers do not receive electric generation, transmission or distribution services from PG&E. However, these customers are required to pay certain charges by law or CPUC decision. On average, these customers would see an increase of 0.7%.

Actual impacts will vary depending on energy usage.

How will PG&E’s application affect gas rates?

Based on rates currently in effect, the gas bill for a typical residential nonCARE customer averaging 33 therms per month of gas usage would increase from $59.97 to $60.94, or 1.6%. Actual impacts will vary depending on energy usage across months.

Detailed rate information will be sent directly to customers in a bill insert in September.

How does the rest of this process work?

This application will be assigned to a CPUC Administrative Law Judge and CPUC Commissioner who will consider proposals and evidence presented during the formal hearing process. The Administrative Law Judge will issue a proposed decision that may adopt PG&E’s application, modify it or deny it. Any CPUC Commissioner may sponsor an alternate decision with a different outcome. The proposed decision, and any alternate decisions, will be discussed and voted upon by the CPUC Commissioners at a public CPUC Voting Meeting.

Parties to the proceeding are currently reviewing PG&E’s application, including the Public Advocates Office, which is an independent consumer advocate within the CPUC that represents customers to obtain the lowest possible rate for service consistent with reliable and safe service levels. For more information about the Public Advocates Office, please call 1-415-703-1584, email [email protected], or visit PublicAdvocates.cpuc.ca.gov.

Where can I get more information?

CONTACT PG&E

If you have questions about PG&E’s filing, please contact PG&E at 1-800-743-5000. For TTY, call 1-800-652-4712.

If you would like a copy of the filing and exhibits, please write to the address below:

Pacific Gas and Electric Company

Cost of Capital Application (A.21-08-015)

P.O. Box 7442

San Francisco, CA 94120

CONTACT CPUC

Please visit apps.cpuc.ca.gov/c/A2108015 to submit a comment about this proceeding on the CPUC Docket Card. Here you can also view documents and other public comments related to this proceeding. Your participation by providing your thoughts on PG&E’s request can help the CPUC make an informed decision.

If you have questions about CPUC processes, you may contact the CPUC’s Public Advisor’s Office at:

Email: [email protected]

Mail: CPUC

Public Advisor’s Office

505 Van Ness Avenue

San Francisco, CA 94102

Call: 1-866-849-8390 (toll-free) or 1-415-703-2074

For TTY, call 1-866-836-7825 (toll-free)

Please reference Cost of Capital Application (A.21-08-015) in any communications you have with the CPUC regarding this matter.