Dive Brief:
- Pacific Gas & Electric (PG&E) reported earnings for Q2 2014 were down 18% to $267 million from $332 million earned over the same period last year.
- Earnings were down due to the estimated $2.7 billion cost of natural gas pipeline safety work in the wake of the fatal San Bruno pipeline explosion, a 9.4% increase in total operating expenses, and a delay in getting the utility's general rate case approved.
- The earnings come on the heels of news that the U.S. Attorney has more charges against the utility related to the San Bruno incident, including allegations that the company obstructed the federal investigation into the explosion. The utility does "not believe any of these criminal charges or fines are warranted," PG&E CEO Tony Early told investors on an earnings call.
Dive Insight:
PG&E continues to see the impact of the drought and increasing gas prices on electricity costs, which will soon have an upward pressure on customer rates, according to the utility.
PG&E CEO Tony Early expressed optimism that the utility will hit the state's 33% renewables by 2020 target. "We're in the high 20% range now, and we've done a lot of hard work to figure out how to integrate those renewables into the system," Early said.
However, PG&E has no plans to invest "in any renewables in any time in the future," said Chris Johns, president of PG&E. "But they will still come online, and we'll do most of that through contracting."
Johns emphasized the need for PG&E to modernize the utility's transmission and distribution infrastructure and "making sure that we're able to accommodate all the new rooftop solar panels, the storage that's going to come online at some point, electric vehicles."