With an emphasis on its electric utility operations, Pacific Gas and Electric Co. notified the California Public Utilities Commission (CPUC) Monday that it intends to file for a $654 million rate increase later this year to be effective in 2007.

The rate hike by the PG&E Corp. utility would be to cover proposed upgrades of its natural gas and electric infrastructure covering central and northern California.

The utility said it expects to apply to the CPUC for $485 million of new revenue for its electric distribution system; a $94 million increase for natural gas operations, and $75 million for investments in generation plants. PG&E’s utility will file its main application on Dec. 1, and it expects the CPUC to hold public hearings and take testimony next year with a decision by the end of 2006.

“The rate increase is needed to replace aging infrastructure, meet rising demand for gas and electricity, recruit/train new employees, and upgrade power plants,” the utility said in an alert to news media on its notice to the CPUC.

The proposed rate increase would be 1.6%, or $1.03/month, for average electric customers, and 2.8%, or $1.44/month, for average natural gas customers.

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