Answers to Common Questions About PG&E's Revised 2027 Investment Plan

To help keep customer costs down, PG&E recently announced plans to defer about $2 billion of work in 2027. Customers have asked why PG&E is updating its investment plans and what that means for affordability, safety and reliability. Here are the key facts.

Why is PG&E delaying some investment in 2027?

PG&E needs to raise billions of dollars each year to maintain and modernize the energy system. Today, the cost of borrowing that money is too high. That’s because under California’s ‘inverse condemnation’ standard, utilities are held strictly liable for damages if their equipment is found to have caused a wildfire, even if the company followed all safety requirements and acted reasonably.  

That risk makes some investors wary of investing in California at all, which reduces the amount of money available to improve the energy system. 

It also impacts PG&E’s credit rating, which leads to higher borrowing costs from lenders, which ultimately makes critical infrastructure projects more expensive. Rather than pass those increased costs onto customers at this time, PG&E is reprioritizing its 2027 investments while ensuring that safety and compliance work continues. 

How much investment is PG&E deferring?

PG&E is reducing planned 2027 investment by about $2 billion. Even so, we still expect to invest approximately $11.4 billion in 2027, making it one of the largest investment years in our history.

Haven't customers already paid for this work?

No. The projects PG&E is considering reprioritizing have not yet been included in customer rates. It is normal for investors to prefund PG&E investments, and that they are then paid for by customers over time. 

Why can’t PG&E just pay for this work out of its profits?

Earnings alone cannot cover the full cost of the work we need to do. PG&E invests four to five times more in the energy system each year than it earns. That means PG&E must first raise the money needed to build major projects by borrowing money or issuing equity. It’s like securing a mortgage to buy a home that costs more than you can afford with your income. PG&E raises funds in advance so that we can pay sooner for infrastructure that delivers better safety, reliability, resiliency and cleaner energy. Access to affordable outside funding is essential.

Is PG&E trying to pressure policymakers?

No. PG&E will continue working constructively with state leaders, but we also need to take actions within our control. The updated investment plan and accompanying Strategic Review (a process designed to help PG&E be a financially strong company with a strong credit rating) are intended to reduce financing costs for customers and help build a stronger, more affordable energy system for the future.

How would liability reform change PG&E's accountability for wildfire costs?

PG&E welcomes accountability and believes utilities should have strong incentives to operate safely and reduce wildfire risk. We have made significant progress reducing wildfire risk in recent years and are now in our fourth year without a major wildfire caused by our equipment. We continue to invest billions of dollars each year in wildfire prevention and system safety. 

The challenge is that California's current liability framework creates significant financial risk, even when a utility follows safety requirements and acts reasonably. That risk increases borrowing costs, which increases customer bills. PG&E believes California needs a durable solution that supports wildfire survivors, maintains accountability and safety incentives, reduces wildfire risk, and enables affordable investment in the energy system.

Will safety or wildfire prevention work be cut?

No. Safety remains our top priority. PG&E intends to continue funding critical safety programs, meet regulatory requirements, and carry out its Wildfire Mitigation Plan. Safety and compliance work will continue. 

What kinds of projects could move more slowly?

Some reliability improvements, new customer connections, and new energy supply connections may take longer. PG&E will work directly with affected customers and partners if schedules change. 

What happens next?

PG&E has launched a Strategic Review to evaluate how the company is organized and financed. The goal is simple: maintain safety, improve affordability and reliability, and ensure PG&E can attract the long-term investment needed to serve customers and support California's energy future.