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PG&E Expects Earnings Hit Because of Rate Case

PG&E Expects Earnings Hit Because of Rate Case

In what was said to be a message for Wall Street rather than state energy regulators, PG&E Corp. announced Monday that its second quarter results due out July 21 will be lower-than-expected because of continuing delays in getting a decision on its pending general rate case before the California Public Utilities Commission. The company made a similar announcement near the end of the first quarter.

The general rate case will cost the company a "significant percentage" of its quarterly earnings in the second quarter, according to Greg Pruett, a PG&E Corp. vice president. But PG&E's third and fourth quarter earnings will be skewed upward if the case is decided in the third quarter because it will call for the implementation of a full annual increase in earnings in the final two quarters of the year.

The CPUC originally was scheduled to make a decision on the general rate request earlier this year, but at that time the five-member commission was operating with only three members. A proposed decision from the administrative law judge (ALJ) on the case now is not expected until August and a final decision is not possible before "late in the third quarter," PG&E said.

"We don't know what we'll get out of the decision," Pruett said. "The ALJ has had this case for a considerable amount of time and we haven't gotten any indication from the commission or the ALJ what direction they are going. Like everyone else we'll have to wait and see what their decision will be." In the meantime, the PG&E utility is operating off its 1996 general rate case decision.

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