By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: July 27, 2023

PG&E profits hop higher as electricity, gas revenues rise

Utility seeks to improve its system in wake of catastrophic wildfires, San Bruno gas explosion

OAKLAND — Profits at PG&E hopped higher in the second quarter of 2023, bolstered by solid increases in the utility behemoth’s revenue from its electricity and gas operations, the company reported Thursday.

The surge in profits and revenue arrives as the company, which in recent years has been hit with more than a billion dollars in penalties for its role in some of the state’s deadliest wildfires, is attempting to carry out wide-ranging upgrades of its vast electric and gas networks in northern and central California.

“Through the first half of 2023, we feel confident that we continue to reduce physical risk on our system overall,” said Patricia Poppe, CEO of PG&E, the nation’s largest utility, which serves more than 5 million California households.

The Oakland-based utility earned $406 million in its April-through-June second quarter, an increase of 17.3% over the company’s profits of $356 million during the same period a year ago.

The gains angered some consumer advocates, who have criticized the utility for steady increases in monthly bills.

“PG&E putting profits ahead of people has Wall Street laughing all the way to the bank at the expense of ratepayers,” said Mark Toney, executive director the San Francisco-based The Utility Reform Network, or TURN.

The company asserts that its profits into its electricity and gas operations. “Our earnings are reinvested back into the system,” said Andrew Castagnola, a PG&E spokesperson.

PG&E said it produced $5.29 billion in revenue in the second quarter, up 3.4% from $5.12 billion in the year-ago April-June period. Electricity revenue totaled $3.85 billion, up 4.4% from the year before, while gas revenue was $1.44 billion, a 0.7% increase from the 2022 second quarter.

A financially healthier PG&E is healthier and safer for our customers,” Castagnola said.

The robust improvement in the company’s financial picture is being driven by multiple factors, PG&E said. It cited lower expenses related to its now-concluded bankruptcy case, reduced costs for paying out wildfire-related claims, and restructured contracts with vendors for certain activities, including tree removal and vegetation controls.

Plus, PG&E is attempting to keep a tight grip on its operations and maintenance costs. Over the first half of 2023, PG&E’s operations and maintenance costs totaled $5.11 billion, down 5.4% compared with the first six months of 2022.

However, during the April-June second quarter, PG&E’s operations and maintenance expenses totaled $5.11 billion, up 6.3% from the prior year.

“Our investments since 2017 have made a dramatic difference in preventing catastrophic wildfires,” Poppe said.

But Toney, the consumer advocate for TURN, warned that PG&E customers may soon have to confront even higher monthly electricity and gas bills.

Looming on the docket of the state Public Utilities Commission: a general rate case proposal that could produce a 32% increase over the next several years for monthly bills, according to Toney.

“These profits are outrageous,” Toney said. “With the affordability crisis, the PUC has to do something to stop these skyrocketing rates. California customers should not suffer while Wall Street investors reap the benefits of PG&E’s huge profits.”