QUOTE AND NEWS
Insurance Journal  Jan 27  Comment 
The California Public Utilities Commission has fined Pacific Gas & Electric $530,000 for safety violations it says it found during audits that began in 2012. The commission says in a Friday statement that the fines include $430,000 for failing to...
Motley Fool  Jan 25  Comment 
After a massive explosion, Pacific Gas & Electric took matters into its own hands to avoid a repeat. The entire industry could benefit.
Forbes  Jan 14  Comment 
Looking at the sectors faring best as of midday Wednesday, shares of Utilities companies are outperforming other sectors, not showing much of a loss. Within that group, FirstEnergy (NYSE: FE) and PG&E (NYSE: PCG) are two large stocks leading the...
Market Intelligence Center  Jan 14  Comment 
The patented algorithms that power MarketIntelligenceCenter.com's Artificial Intelligence Center found a trading opportunity with PG&E Corp (PCG) that should provide a 2.12% return in just 65 days. Sell one Mar. '15 call at the $55.00 level for...
Forbes  Jan 13  Comment 
The best performing sector as of midday Tuesday is the Utilities sector, losing just 0.1%. Within the sector, PG&E (NYSE: PCG) and Public Service Enterprise Group (NYSE: PEG) are two large stocks leading the way, showing a gain of 1.4% and 0.7%,...
Market Intelligence Center  Jan 12  Comment 
The patented algorithms that power MarketIntelligenceCenter.com's Artificial Intelligence Center found a trading opportunity with PG&E Corp (PCG) that should provide a 2.55% return in just 67 days. Sell one Mar. '15 call at the $55.00 level for...
Market Intelligence Center  Jan 9  Comment 
PG&E Corp (PCG) presents a trading opportunity that offers a 2.27% return in just 70 days. A covered call on Pacific Gas and Electric at the $55.00 level expiring on Mar. '15 offers an assigned return rate of 2.27% or 11.83% annualized. This...
Benzinga  Jan 5  Comment 
Pacific Gas and Electric Company (PG&E) and automaker BMW are teaming up to test the ability of electric vehicle batteries to provide valuable services to the electric grid. If successful, the pilot program could pave the way for significant...
Automotive World  Jan 5  Comment 
Today at the Consumer Electronics Show, BMW announced the BMW i ChargeForward Program. The pilot study will be undertaken by the BMW Group Technology Office, together with Pacific Gas & Electric Company (PG&E), whose service area covers much of...
TheStreet.com  Jan 5  Comment 
NEW YORK (TheStreet) -- PG&E Corp. was upgraded to "overweight" from "equal-weight" at Barclays on Monday. The firm said it raised its rating on the natural gas and electricity provider as it believes the company's regulatory issues will...




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PG&E Corp (NYSE: PCG) is an energy holding company whose primary subsidiary is the regulated utility, Pacific Gas and Electric. PG&E operates in 47 of 58 Northern and Central Californian counties and provides electricity and gas to over 9 million customers. As a regulated utility, PG&E has very little competition and a strong customer base. In 2009, it had 5.1 million electricity distribution customers, and 4.3 million natural gas distribution customers. Its business is stable and relatively low-risk because the utility can rely on a consistent customer base who pay rates determined by the state utilities commission.

Ultimately, PG&E’s future is inextricably tied to its relationship with the California Public Utilities Commission (CPUC). The CPUC is responsible for setting most of the regulations that govern PG&E’s business—most importantly the rates it is able to charge customers. In 2000, the CPUC set rates so low PG&E couldn’t turn a profit, which forced them into bankruptcy and contributed to the state-wide energy crisis. Since then, PG&E and the CPUC have had a better relationship, due in part to residual fears of another crisis. However, PG&E has to renegotiate its “rate-case” in 2011, so it is unclear how long the current trend will last.

Company Overview

History

Pacific Gas and Electric (PG&E) was founded in San Francisco in 1905 after the consolidation of more than two dozen power and water companies across California. PG&E began delivering natural gas to northern California in 1930 and after WWII began quickly building new power plants. In the late 1990s, deregulation of the California energy market allowed PG&E to sell most of its natural gas plants. While it continued to operate other types of plants (hydroelectric, nuclear, and a few remaining natural gas), this move forced the utility to buy power from outside energy generators at variable prices while providing energy to consumers at fixed rates. In 2000, energy costs became so high that California was pushed into an energy crisis that including rolling blackouts throughout the state. PG&E was forced to declare bankruptcy in April 2001 when it could no longer sell energy for more than it could buy on the open market. PG&E emerged from bankruptcy in April 2004.

Business Performance and Products

PG&E provides gas and electricity to customers across Northern and Central California. The utility owns power-generation facilities that supply approximately 40% of its annual needs and purchases the rest. These facilities include 118 hydroelectric, nuclear, and fossil-fuel plants in California. During 2009, PG&E had revenues of $13.4 billion, and was able to post a net income of $1.23 billion in 2009.

PG&E supplies electricity to 5.1 million customers and gas to 4.3 million customers.[1] As the dominant utility in the region, PG&E provides electricity to both homes and businesses. The corporate-sales side is particularly complex in Silicon Valley, where IT firms need especially high amounts of energy. PG&E also works with large customers (like Yahoo! (YHOO) and Adobe Systems (ADBE)) to help them design facilities that are energy efficient and keep power use low across their companies. Here is a breakdown of customer profiles for both the gas and electricity businesses:

I think you hit a bullseye there flelas!

Competitors

As a regulated utility company, PG&E has no real competition in the markets it serves. In other parts of California, two other energy concerns provide power: Southern California Edison and San Diego Gas & Electric. Nationwide, PG&E performs well compared to other utilities and is even considered a “bellwether” company in the domestic utility industry because of its especially constructive relationship with the CPUC and the growing California electricity market—since 2003, PG&E has grown twice as fast as the industry as a whole. While not the only company to provide both gas and electricity, PG&E is in the minority as more utilities focus exclusively on electricity.



References

  1. PCG 10-K 2009 Item 1 Pg. 1
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