|
|
Three
months ended December 31,
|
Twelve
months ended December 31,
|
|||||||||||||||||||||||
|
|
Earnings
(Loss)
|
Earnings
(Loss) per Common Share Diluted
|
Earnings
(Loss)
|
Earnings
(Loss) per
Common
Share
Diluted
|
|||||||||||||||||||||
|
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
2006
|
2005
|
|||||||||||||||||
|
PG&E
Corporation Earnings from Operations (1)
|
$
|
170
|
$
|
179
|
$
|
0.48
|
$
|
0.49
|
$
|
922
|
$
|
906
|
$
|
2.57
|
$
|
2.34
|
|||||||||
|
Items
Impacting Comparability (2)
|
|||||||||||||||||||||||||
|
Scheduling
Coordinator Cost Recovery
|
-
|
-
|
-
|
-
|
77
|
-
|
0.21
|
-
|
|||||||||||||||||
|
Environmental
Remediation Liability
|
-
|
-
|
-
|
-
|
(18
|
)
|
-
|
(0.05
|
)
|
-
|
|||||||||||||||
|
Recovery
of Interest on PX Liability
|
-
|
-
|
-
|
-
|
28
|
-
|
0.08
|
-
|
|||||||||||||||||
|
Energy
Crisis/Chapter 11 Interest Costs
|
-
|
-
|
-
|
-
|
-
|
(3
|
)
|
-
|
(0.01
|
)
|
|||||||||||||||
|
AEAP
Settlement
|
-
|
93
|
-
|
0.25
|
-
|
93
|
-
|
0.24
|
|||||||||||||||||
|
Chromium
Litigation Settlement Adjustment
|
-
|
(91
|
)
|
-
|
(0.25
|
)
|
-
|
(91
|
)
|
-
|
(0.23
|
)
|
|||||||||||||
|
Severance
Costs
|
(18
|
)
|
-
|
(0.05
|
)
|
-
|
(18
|
)
|
-
|
(0.05
|
)
|
-
|
|||||||||||||
|
Other
|
-
|
(1
|
)
|
-
|
-
|
-
|
(1
|
)
|
-
|
-
|
|||||||||||||||
|
Total
|
(18
|
)
|
1
|
(0.05
|
)
|
-
|
69
|
(2
|
)
|
0.19
|
-
|
||||||||||||||
|
Discontinued
Operations - NEGT (3)
|
-
|
-
|
-
|
-
|
-
|
13
|
-
|
0.03
|
|||||||||||||||||
|
PG&E
Corporation Earnings on a GAAP basis
|
$
|
152
|
$
|
180
|
$
|
0.43
|
$
|
0.49
|
$
|
991
|
$
|
917
|
$
|
2.76
|
$
|
2.37
|
|||||||||
|
1.
|
Earnings
from operations exclude items impacting comparability as noted
in the
following discussion.
|
|
2.
|
Items
impacting comparability reconcile earnings from operations with
consolidated net income as reported in accordance with
GAAP.
|
|
3.
|
During
the third quarter of 2005, PG&E Corporation received additional
information from its former subsidiary, National Energy & Gas
Transmission, Inc, or NEGT, regarding income to be included in
PG&E
Corporation's 2004 federal income
tax return. This information was incorporated in the 2004 tax return,
which was filed with the IRS in September 2005. As a result, the
2004
federal income tax liability
was reduced by approximately $19 million. NEGT also provided additional
information with respect to amounts previously included in PG&E
Corporation's 2003
federal income tax return. This change resulted in PG&E Corporation's
2003 federal income tax liability increasing by approximately $6
million.
These two adjustments,
netting to $13 million, were recognized in income from discontinued
operations in the third quarter of 2005.
|
|
|
Three
months ended December 31,
|
Twelve
months ended December 31,
|
|||||||||||
|
|
Earnings
(Loss)
|
Earnings
(Loss)
|
|||||||||||
|
|
2006
|
2005
|
2006
|
2005
|
|||||||||
|
Pacific
Gas and Electric Company Earnings from Operations (1)
|
$
|
173
|
$
|
181
|
$
|
902
|
$
|
919
|
|||||
|
Items
Impacting Comparability (2)
|
|||||||||||||
|
Scheduling
Coordinator Cost Recovery
|
-
|
-
|
77
|
-
|
|||||||||
|
Environmental
Remediation Liability
|
-
|
-
|
(18
|
)
|
-
|
||||||||
|
Recovery
of Interest on PX Liability
|
-
|
-
|
28
|
-
|
|||||||||
|
Energy
Crisis/Chapter 11 Interest Costs
|
-
|
-
|
-
|
(3
|
)
|
||||||||
|
AEAP Settlement
|
-
|
93
|
-
|
93
|
|||||||||
|
Chromium Litigation Settlement Adjustment
|
-
|
(91
|
)
|
-
|
(91
|
)
|
|||||||
|
Severance Costs
|
(18
|
)
|
-
|
(18
|
)
|
-
|
|||||||
|
Total
|
(18
|
)
|
2
|
69
|
(1
|
)
|
|||||||
|
Pacific
Gas and Electric Company Earnings on a GAAP basis
|
$
|
155
|
$
|
183
|
$
|
971
|
$
|
918
|
|||||
| a) |
Severance
costs of approximately $18 million ($0.05 per common share), after-tax,
to
reflect consolidation of various positions in connection with the
Utility’s continued effort to streamline
processes and achieve cost and operating efficiencies through
implementation of various
initiatives.
|
| a) |
Annual
Earnings Assessment Proceeding, or AEAP, revenues of approximately
$93
million ($0.25 per common share), after-tax, as a result of an October
27,
2005 California Public Utilities
Commission, or CPUC, decision
allowing the Utility to recover shareholder incentives for successful
implementation of certain public purpose programs;
and
|
|
Q4
2005 EPS from Operations (1)
|
$
|
0.49
|
||
|
Share
variance
|
0.02
|
|||
|
Effect
of increase in authorized return on equity
|
0.01
|
|||
|
Diablo
Canyon refueling outage (2)
|
0.07
|
|||
|
Reduction
in litigation settlements (2)
|
0.02
|
|||
|
AEAP
Settlement (3)
|
(0.05
|
)
|
||
|
Employee
benefit plans
|
(0.01
|
)
|
||
|
ERB
Series 2 equity carrying cost credit
|
(0.01
|
)
|
||
|
Miscellaneous
items
|
(0.06
|
)
|
||
|
Q4
2006 EPS from Operations (1)
|
$
|
0.48
|
|
2005
YTD EPS from Operations (1)
|
$
|
2.34
|
||
|
Share
variance
|
0.19
|
|||
|
Effect
of increase in authorized return on equity
|
0.03
|
|||
|
Electric
transmission revenue
|
0.01
|
|||
|
Diablo
Canyon refueling outage timing
|
0.01
|
|||
|
Employee
benefit plans
|
0.02
|
|||
|
Gas
transmission revenue
|
0.05
|
|||
|
Recovery
of energy supplier litigation costs
|
0.03
|
|||
|
Tax
benefit for capital loss utilization
|
0.05
|
|||
|
Environmental
remediation (2)
|
0.03
|
|||
|
Reduction
in litigation settlements (2)
|
0.04
|
|||
|
Refund
of overcollection (2)
|
0.03
|
|||
|
AEAP
Settlement (3)
|
(0.05
|
)
|
||
|
Earnings
on the settlement regulatory asset (3)
|
(0.04
|
)
|
||
|
ERB
Series 2 equity carrying cost credit
|
(0.13
|
)
|
||
|
Miscellaneous
|
(0.04
|
)
|
||
|
2006
YTD EPS from Operations (1)
|
$
|
2.57
|
|
|
Fourth
Quarter
2006
|
Fourth
Quarter
2005
|
%
Change
|
|||||||
|
Common
Stock Data
|
|
|||||||||
|
Book
Value per share - end of period (1)
|
$
|
21.24
|
$
|
19.94
|
6.52
|
%
|
||||
|
Weighted
average common shares outstanding, basic (2)
|
347
|
359
|
(3.34
|
)%
|
||||||
|
Employee
stock-based compensation and accelerated share repurchase
program
|
3
|
5
|
(40
|
)%
|
||||||
|
Weighted
average common shares outstanding, diluted
|
350
|
364
|
(3.85
|
)%
|
||||||
|
9.5%
Convertible Subordinated Notes (participating securities)
|
19
|
19
|
-
|
|||||||
|
Weighted
average common shares outstanding and participating securities, diluted
(2)
|
369
|
383
|
(3.66
|
)%
|
||||||
|
|
|
|||
|
|
2005
EOY Actual
|
2006
EOY Actual
|
2006
EOY Target
|
|
|
1.
|
Overall
customer satisfaction (1)
(composite
of J.D. Power residential & business customer
surveys)
|
94.0
|
100.0
|
94.0
|
|
2.
|
Timely
bills
(%
of bills issued within 35 days)
|
99.38%
|
99.56%
|
99.51%
|
|
3.
|
Estimated
Time of Outage Restoration accuracy
(%
accurate)
|
47%
|
68%
|
50%
|
|
4.
|
System
Average Interruption Duration Index
(yearly
minutes of interruptions per customer)
|
178.7
|
231.3
|
166.0
|
|
5.
|
System
Average Interruption Frequency Index
(yearly
number of interruptions per customer)
|
1.34
|
1.53
|
1.31
|
|
6.
|
Energy
Availability (2)
(composite
of owned generation & procured energy
availability)
|
N/A
|
2.0
|
1.5
|
|
7.
|
Telephone
service level
(%
of calls answered within 20 seconds)
|
75%
|
80%
|
76%
|
|
8.
|
Total
expense per customer*
($
cost of operations per customer)
|
$278
|
$283
|
$283
|
|
9.
|
Diablo
Canyon performance index (3)
(composite
of plant performance metrics)
|
94.7
|
96.8
|
94.0
|
|
10.
|
Employee
Premier Survey index (4)
(average
survey index score from employee satisfaction Premier
survey)
|
64%
|
64%
|
68%
|
|
11.
|
Lost
workday case rate
(frequency
of lost workday cases per 100 employees)
|
1.04
|
0.89
|
0.878
|
|
(in
millions, except cost per customer)
|
2005
EOY
Actual
|
2006
EOY
Actual
|
2006
EOY
Target
|
|||||||
|
GAAP
Operating and Maintenance Expense
|
$
|
3,399
|
$
|
3,697
|
$
|
3,552
|
||||
|
Public
Purpose and Other Balancing Account Programs
|
(360
|
)
|
(470
|
)
|
(568
|
)
|
||||
|
Property
Taxes
|
(172
|
)
|
(187
|
)
|
(184
|
)
|
||||
|
Franchise
Fees & Uncollectible Expense
|
(123
|
)
|
(146
|
)
|
(171
|
)
|
||||
|
Chromium
Litigation
|
(154
|
)
|
-
|
-
|
||||||
|
Pension
Regulatory Deferral
|
-
|
(75
|
)
|
|||||||
|
Environmental
|
-
|
(97
|
)
|
-
|
||||||
|
Reimbursable
Revenue
|
-
|
(80
|
)
|
-
|
||||||
|
Other
|
(50
|
)
|
(27
|
)
|
-
|
|||||
|
Cost
of Operations
|
$
|
2,540
|
$
|
2,615
|
$
|
2,629
|
||||
|
Cost
of Operations/9.24M Customer Accounts
|
$
|
278
|
$
|
283
|
$
|
283
|
||||
|
1.
|
Overall
customer satisfaction:
|
|
PG&E
measures residential and business customer satisfaction with annual
industry-wide surveys conducted by J.D. Power and Associates, as
well as
with proprietary studies using the same survey in intervening quarters.
The overall customer satisfaction metric represents the year-to-date
average of the residential and business overall customer satisfaction
scores from both the J.D. Powers-administered and proprietary surveys.
The
metric is calculated by first averaging the available residential
and
business satisfaction scores (each with 50% weighting) in each quarter
and
then averaging all available quarterly composite scores for the final
year-to-date metric value.
|
|
|
2.
|
Timely
bills:
|
|
Measures
the percentage of bills that have been issued on a timely basis to
customers (i.e., within 35 days of the last scheduled meter
read).
|
|
|
3.
|
Estimated
Time of Outage Restoration accuracy (ETOR):
|
|
The
percentage of outage occurrences, weighted by customers affected,
where
the majority of customers have been given accurate outage duration
information in the early stages of an outage. If the actual time
of outage
restoration does not occur within the two-hour window given to customers,
the measure is considered “missed” for the customers affected by that
outage.
|
|
|
4.
|
System
Average Interruption Duration Index (SAIDI):
|
|
SAIDI
is an indicator of system reliability that measures the average outage
time (in minutes) that a customer experiences in a year (Sum of customer
interruption durations / Total number of customers served).
|
|
|
5.
|
System
Average Interruption Frequency Index (SAIFI):
|
|
SAIFI
is an indicator of system reliability that measures the average number
of
interruptions that a customer experiences in a year (Total number
of
customer interruptions / Total number of customers served).
|
|
|
6.
|
Energy
availability:
|
|
Comprised
of two, equally-weighted principal components, a generation availability
(GA) component and an energy procurement (EP) component, expressed
on a
scale of zero to two (with two representing the greatest energy
availability). The GA component is the annual average percentage
of
PG&E's total hydroelectric, fossil (excluding Hunters Point) and
nuclear generation capacity that is physically capable of producing
power.
The GA component captures losses of capacity attributed to equipment
failures or planned maintenance, including transmission-related events
which constrain generation output. The 0.5 to 2 scale for the Generation
Availability metric spans between 83.57% and 89.57% availability.
The EP
component measures whether sufficient resources are in place to meet
load
requirements and to maximize the availability of ancillary services
to the
California Independent System Operators (CAISO), in order for the
CAISO to
maintain system reliability and to minimize the frequency of CAISO
stage
alerts in PG&E's service area. The combined energy availability score
could be impacted by either the energy availability metric which
measures
the amount of CAISO Stage 2 and 3 alerts or the Generation Availability
metric.
|
|
|
7.
|
Telephone
service level:
|
|
Measures
the percentage of customer calls that have been either (1) completed
by
automated voice response systems for self-service, or (2) answered
in 20
seconds or less by customer service representatives.
|
|
|
8.
|
Total
expense per customer:
|
|
Measures
the average annual cost of operations per customer and includes all
budget
expense items, including business unit and corporate service department
expenses, casualty, benefits, severance, and insurance. This metric
excludes capital-related costs such as depreciation and interest,
and the
commodity costs of gas and electricity. The denominator is defined
as the
average number of active gas and electric customer accounts for the
year.
This metric is an indicator of overall efficiency and productivity
in
delivering energy to PG&E customers.
|
|
|
9.
|
Diablo
Canyon composite performance index:
|
|
Performance
index is intended to provide a quantitative indication of plant
performance in the areas of nuclear plant safety, reliability, and
plant
efficiency.
|
|
|
10.
|
Employee
Premier Survey index:
|
|
Provides
a comprehensive indicator of employee satisfaction that is derived
averaging the percentage of favorable responses from all 40 core
survey
items within the Premier Survey.
|
|
|
11.
|
Lost
workday case rate:
|
|
Measures
the number of non-fatal injury and illness cases that (1) satisfy
OSHA
requirements for recordability, (2) occur in the current year, and
(3)
result in at least one day away from work. The rate measures how
frequently new lost workday cases occur for every 200,000 hours worked,
or
for approximately every 100
employees.
|
|
|
Three
Months Ended December 31,
|
Twelve
Months Ended December 31,
|
||||||||||||
|
2006
|
2005
|
2006
|
2005
|
||||||||||
|
Electric
Sales (in millions kWh)
|
|||||||||||||
|
Residential
|
7,244
|
7,046
|
31,014
|
29,752
|
|||||||||
|
Commercial
|
8,281
|
8,141
|
33,492
|
32,375
|
|||||||||
|
Industrial
|
3,759
|
3,766
|
15,166
|
14,932
|
|||||||||
|
Agricultural
|
964
|
899
|
3,839
|
3,742
|
|||||||||
|
BART,
public street and highway lighting
|
176
|
196
|
785
|
792
|
|||||||||
|
Other
electric utilities
|
-
|
6
|
14
|
33
|
|||||||||
|
Sales
from Energy Deliveries
|
20,424
|
20,054
|
84,310
|
81,626
|
|||||||||
|
|
|||||||||||||
|
Total
Electric Customers at December 31
|
5,066,635
|
5,007,772
|
|||||||||||
|
|
|||||||||||||
|
Bundled
Gas Sales (in millions MCF)
|
|||||||||||||
|
Residential
|
49
|
45
|
196
|
194
|
|||||||||
|
Commercial
|
18
|
19
|
73
|
77
|
|||||||||
|
Total
Bundled Gas Sales
|
67
|
64
|
269
|
271
|
|||||||||
|
Transportation
Only
|
154
|
153
|
559
|
573
|
|||||||||
|
Total
Gas Sales
|
221
|
217
|
828
|
844
|
|||||||||
|
Total
Gas Customers at December 31
|
4,234,723
|
4,182,804
|
|||||||||||
|
|
|||||||||||||
|
Sources
of Electric Energy (in millions kWh)
|
|||||||||||||
|
Utility
Generation
|
|||||||||||||
|
Nuclear
|
4,769
|
3,551
|
18,391
|
17,692
|
|||||||||
|
Hydro
(net)
|
2,903
|
2,074
|
13,827
|
11,866
|
|||||||||
|
Fossil
|
110
|
211
|
624
|
1,044
|
|||||||||
|
Total
Utility Generation
|
7,782
|
5,836
|
32,842
|
30,602
|
|||||||||
|
Purchased
Power
|
|||||||||||||
|
Qualifying
Facilities
|
4,058
|
3,493
|
16,312
|
16,998
|
|||||||||
|
Irrigation
Districts
|
558
|
795
|
5,102
|
3,900
|
|||||||||
|
Other
Purchased Power
|
151
|
183
|
2,043
|
1,071
|
|||||||||
|
Spot
Market Purchases, net
|
1,435
|
2,807
|
6,202
|
3,716
|
|||||||||
|
Total
Purchased Power (1)
|
6,202
|
7,278
|
29,659
|
25,685
|
|||||||||
|
Delivery
from DWR
|
5,171
|
5,211
|
19,585
|
20,476
|
|||||||||
|
|
|||||||||||||
|
Delivery
to Direct Access Customers
|
1,742
|
2,166
|
7,604
|
8,867
|
|||||||||
|
|
|||||||||||||
|
Other
(includes energy loss)
|
(473
|
)
|
(437
|
)
|
(5,380
|
)
|
(4,004
|
)
|
|||||
|
|
|||||||||||||
|
Total
Electric Energy Delivered
|
20,424
|
20,054
|
84,310
|
81,626
|
|||||||||
|
|
|||||||||||||
|
Diablo
Canyon Performance
|
|||||||||||||
|
Overall
capacity factor (including refuelings)
|
97
|
%
|
75
|
%
|
95
|
%
|
93
|
%
|
|||||
|
Refueling
outage period
|
None
|
10/23-12/03
|
4/17-5/25
|
10/23-12/03
|
|||||||||
|
Refueling
outage duration during the period (days)
|
None
|
41.0
|
38.8
|
41.0
|
|||||||||
|
|
Low
|
High
|
|||||
|
EPS
Guidance on an Earnings from Operations Basis
|
$
|
2.70
|
$
|
2.80
|
|||
|
Estimated
Items Impacting Comparability
|
$
|
0.00
|
$
|
0.00
|
|||
|
EPS
Guidance on a GAAP Basis
|
$
|
2.70
|
$
|
2.80
|
|||
| · |
the
Utility’s ability to timely recover costs through rates;
|
| · |
the
outcome of regulatory proceedings, including ratemaking proceedings
pending at the CPUC and the FERC;
|
| · |
the
adequacy and price of electricity and natural gas supplies, and the
ability of the Utility to manage and respond to the volatility of
the
electricity and natural gas markets;
|
| · |
the
effect of weather, storms, earthquakes, fires, floods, disease, other
natural disasters, explosions, accidents, mechanical breakdowns,
acts of
terrorism, and other events or hazards that could affect the Utility’s
facilities and operations, its customers and third parties on which
the
Utility relies;
|
| · |
the
potential impacts of climate change on the Utility’s electricity and
natural gas operations;
|
| · |
changes
in customer demand for electricity and natural gas resulting from
unanticipated population growth or decline, general economic and
financial
market conditions, changes in technology including the development
of
alternative energy sources, or other
reasons;
|
| · |
operating
performance of the Utility’s Diablo Canyon nuclear generating facilities,
or Diablo Canyon, the occurrence of unplanned outages at Diablo Canyon,
or
the temporary or permanent cessation of operations at Diablo Canyon;
|
| · |
the
ability of the Utility to recognize benefits from its initiatives
to
improve its business processes and customer service;
|
| · |
the
ability of the Utility to timely complete its planned capital investment
projects;
|
| · |
the
impact of changes in federal or state laws, or their interpretation,
on
energy policy and the regulation of utilities and their holding
companies;
|
| · |
the
impact of changing wholesale electric or gas market rules, including
the
California Independent System Operator’s,
or the CAISO’s, new rules to restructure the California wholesale
electricity market;
|
| · |
how
the CPUC administers the conditions imposed on PG&E Corporation when
it became the Utility’s holding
company;
|
| · |
the
extent to which PG&E Corporation or the Utility incurs costs in
connection with pending litigation that are not recoverable through
rates,
from third parties, or through insurance recoveries;
|
| · |
the
ability of PG&E Corporation and/or the Utility to access capital
markets and other sources of
credit;
|
| · |
the
impact of environmental laws and regulations and the costs of compliance
and remediation;
|
| · |
the
effect of municipalization, direct access, community choice aggregation,
or other forms of bypass; and
|
| · |
other
factors discussed in PG&E Corporation's and Pacific Gas and Electric
Company’s SEC reports.
|
|
2005
|
2006
|
2007
|
||||||||
|
Recorded
|
Recorded
|
Estimated
|
||||||||
|
Total
Weighted Average Rate Base (in billions)
|
$
|
15.1
|
$
|
15.9
|
$
|
17.3
|
||||
|
Variable
|
Description
of Change
|
Estimated
Earnings Impact
|
|
Rate
base
|
+/-
$100 million change in rate base (1)
|
+/-
$6 million
|
|
Return
on equity (ROE)
|
+/-
0.1% change in earned ROE
|
+/-
$9 million
|
|
Share
count
|
+/-
1% change in average shares
|
-/+
$0.03 per share
|
|
Revenues
|
+/-
$7 million change in revenues (pre-tax), including Electric Transmission
and California Gas Transmission
|
+/-
$0.01 per share
|
|
Cash
and Cash Equivalents, January 1, 2006
|
$
|
713
|
||
|
|
||||
|
Sources
of Cash
|
||||
|
Cash
from operations
|
$
|
2,714
|
||
|
Decrease
in restricted cash
|
115
|
|||
|
Net
proceeds from sale of assets
|
17
|
|||
|
Net
borrowing under credit facilities
|
40
|
|||
|
Issuance
of commercial paper, net of discount of $2 million
|
458
|
|||
|
Common
stock issued
|
131
|
|||
|
Other
|
3
|
|||
|
|
$
|
3,478
|
||
|
|
||||
|
Uses
of Cash
|
||||
|
Capital
expenditures
|
$
|
2,402
|
||
|
Proceeds
from and investments in nuclear decommissioning trust, net
|
157
|
|||
|
Rate
reduction bonds matured
|
290
|
|||
|
Energy
recovery bonds matured
|
316
|
|||
|
Common
stock repurchased
|
114
|
|||
|
Common
stock dividends paid
|
456
|
|||
|
|
$
|
3,735
|
||
|
|
||||
|
Cash
and Cash Equivalents, December 31, 2006
|
$
|
456
|
|
|
2006
|
2005
|
Change
|
|||||||
|
|
||||||||||
|
Cash
Flow from Operating Activities (YTD December 31)
|
||||||||||
|
PG&E
Corporation
|
$
|
137
|
$
|
43
|
$
|
94
|
||||
|
Pacific
Gas and Electric Company
|
2,577
|
2,366
|
211
|
|||||||
|
$
|
2,714
|
$
|
2,409
|
$
|
305
|
|||||
|
Consolidated
Cash Balance (at December 31)
|
||||||||||
|
PG&E
Corporation
|
$
|
386
|
$
|
250
|
$
|
136
|
||||
|
Pacific
Gas and Electric Company
|
70
|
463
|
(393
|
)
|
||||||
|
$
|
456
|
$
|
713
|
$
|
(257
|
)
|
||||
|
Consolidated
Restricted Cash Balance (at December 31)
|
||||||||||
|
PG&E
Corporation
|
$
|
-
|
$
|
-
|
$
|
-
|
||||
|
Pacific
Gas and Electric Company(1)
|
1,431
|
1,546
|
(115
|
)
|
||||||
|
$
|
1,415
|
$
|
1,546
|
$
|
(115
|
)
|
||||
|
|
Balance
at
December
31,
|
||||||
|
|
2006
|
2005
|
|||||
|
|
|||||||
|
PG&E
Corporation
|
|
|
|||||
|
Convertible
subordinated notes, 9.50%, due 2010
|
$
|
280
|
$
|
280
|
|||
|
Less:
current portion
|
(280
|
)
|
-
|
||||
|
|
- |
280
|
|||||
|
Utility
|
|||||||
|
Senior
notes/first mortgage bonds(1):
|
|||||||
|
3.60%
to 6.05% bonds, due 2009-2034
|
5,100
|
5,100
|
|||||
|
Unamortized
discount, net of premium
|
(16
|
)
|
(17
|
)
|
|||
|
Total
senior notes/first mortgage bonds
|
5,084
|
5,083
|
|||||
|
Pollution
control bond loan agreements, variable rates(2),
due 2026(3)
|
614
|
614
|
|||||
|
Pollution
control bond loan agreement, 5.35%, due 2016
|
200
|
200
|
|||||
|
Pollution
control bond loan agreements, 3.50%, due 2023(4)
|
345
|
345
|
|||||
|
Pollution
control bond loan agreements, variable rates(5),
due 2016-2026
|
454
|
454
|
|||||
|
Other
|
1
|
2
|
|||||
|
Less:
current portion
|
(1
|
)
|
(2
|
)
|
|||
|
Long-term
debt, net of current portion
|
6,697
|
6,696
|
|||||
|
Total
consolidated long-term debt, net of current
portion
|
$
|
6,697
|
$
|
6,976
|
|||
|
(1) When
originally issued, these debt instruments were denominated as first
mortgage bonds and were secured by a lien, subject to permitted
exceptions, on substantially all of the Utility’s real property and
certain tangible personal property related to its facilities. The
indenture under which the first mortgage bonds were issued provided
for
release of the lien in certain circumstances subject to certain
conditions. The release occurred in April 2005 and the remaining
bonds
were redesignated as senior notes.
|
|||||||
|
(2) At
December 31, 2006, interest rates on these loans ranged from 3.80%
to
3.92%.
|
|||||||
|
(3) These
bonds are supported by $620 million of letters of credit which expire
on
April 22, 2010. Although the stated maturity date is 2026, the bonds
will
remain outstanding only if the Utility extends or replaces the letters
of
credit.
|
|||||||
|
(4) These
bonds are subject to a mandatory tender for purchase on June 1, 2007
and
the interest rates for these bonds are set until that date.
|
|||||||
|
(5) At
December 31, 2006, interest rates on these loans ranged from 3.25%
to
3.70%.
|
|||||||
|
|
2007
|
|
2008
|
|
|
2009
|
|
2010
|
|
2011
|
|
|
Thereafter
|
|
Total
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Long-term
debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
PG&E
Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Average
fixed interest rate
|
|
|
9.50
|
%
|
|
-
|
|
|
-
|
|
|
-
|
|
-
|
|
|
-
|
|
|
9.50
|
%
|
|||
|
Fixed
rate obligations
|
|
$
|
280
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
280
|
|
||
|
Utility
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
fixed interest rate
|
|
|
-
|
|
-
|
|
3.60
|
%
|
|
-
|
|
|
4.20
|
%
|
|
|
5.55
|
%
|
|
5.22
|
%
|
|||
|
Fixed
rate obligations
|
|
$
|
-
|
$
|
-
|
$
|
600
|
|
$
|
-
|
|
$
|
500
|
|
$
|
4,529
|
|
$
|
5,629
|
|
||||
|
Variable
interest rate as of December 31, 2006
|
|
|
-
|
|
|
-
|
|
-
|
|
|
3.88
|
%
|
|
-
|
|
|
3.59
|
%
|
|
3.76
|
%
|
|||
|
Variable
rate obligations
|
|
$
|
-
|
|
$
|
-
|
$
|
-
|
|
$
|
614
|
(1)
|
$
|
-
|
|
$
|
454
|
|
$
|
1,068
|
|
|||
|
Other
|
|
$
|
1
|
|
$
|
-
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
1
|
|
|||
|
Less:
current portion
|
(281)
|
(2)
|
-
|
-
|
-
|
-
|
-
|
(281)
|
||||||||||||||||
|
Total
consolidated long-term debt
|
|
$
|
-
|
|
$
|
-
|
$
|
600
|
|
$
|
614
|
|
$
|
500
|
|
$
|
4,983
|
|
$
|
6,697
|
|
|||
|
(1)
The $614 million pollution control bonds, due in 2026, are backed
by
letters of credit which expire on April 22, 2010. The bonds will
be
subject to a mandatory redemption unless the letters of credit are
extended or replaced. Accordingly, the bonds have been classified
for
repayment purposes in 2010.
|
||||||||||||||||||||||||
|
(2)
The
holders of the $280 million 9.50% Convertible Subordinated Notes
have a
one-time right to require PG&E Corporation to repurchase the
Convertible Subordinated Notes on June 30, 2007, at a purchase price
equal
to the principal amount plus accrued and unpaid interest (including
liquidated damages and unpaid “pass-through dividends,” if
any).
|
||||||||||||||||||||||||
|
|
|
2007
|
|
2008
|
|
2009
|
|
2010
|
|
2011
|
|
Thereafter
|
|
Total
|
|
|||||||
|
Utility
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Average
fixed interest rate
|
|
|
6.48
|
%
|
|
-
|
|
-
|
|
|
-
|
|
|
-
|
|
|
-
|
|
|
6.48
|
%
|
|
|
Rate
reduction bonds
|
|
$
|
290
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
-
|
|
$
|
290
|
|
|
Average
fixed interest rate
|
|
|
4.19
|
%
|
|
4.19
|
%
|
|
4.36
|
%
|
|
4.49
|
%
|
|
4.61
|
%
|
|
4.64
|
%
|
|
4.43
|
%
|
|
Energy
recovery bonds
|
|
$
|
340
|
|
$
|
354
|
|
$
|
369
|
|
$
|
386
|
|
$
|
424
|
|
$
|
403
|
|
$
|
2,276
|
|
|
Name
|
Brief
Description
|
Docket
Number
|
|
2007
General Rate Case
(2007
GRC)
|
Primary
CPUC proceeding determining the amount of revenue requirements collected
from customers to recover the basic business and operational costs
related
to electricity and natural gas distribution and utility-owned electricity
generation operations.
|
A.05-12-002
|
|
Gas
Accord
|
CPUC
proceeding to set rates, terms and conditions for gas transmission
and
storage services effective January 1, 2008.
|
To
be filed March 15, 2007
|
|
2006
Long Term Procurement Plan
(2006
LTPP)
|
CPUC
proceeding to review the 2007-2016 electric energy and electric fuel
procurement plans.
|
R.06-02-013
|
|
Billing
and Collection Investigation
|
CPUC
investigation into billing and collection practices and credit
policies.
|
I.03-01-012
|
|
QF
Pricing and Policy
|
CPUC
rulemaking proceedings considering various policy and pricing issues
related to power purchased from Qualifying Facilities.
|
R.04-04-003
R.04-04-025
R.99-11-022
|
|
Transmission
Owner 9 Rate Case
(TO9)
|
Primary
FERC rate-making proceeding to determine electric transmission revenues
and wholesale and retail transmission rates.
|
ER06-1325-000
|
|
|
Year
ended December 31,
|
|||||||||
|
|
2006
|
2005
|
2004
|
|||||||
|
Operating
Revenues
|
|
|
|
|||||||
|
Electric
|
$
|
8,752
|
$
|
7,927
|
$
|
7,867
|
||||
|
Natural
gas
|
3,787
|
3,776
|
3,213
|
|||||||
|
Total
operating revenues
|
12,539
|
11,703
|
11,080
|
|||||||
|
Operating
Expenses
|
||||||||||
|
Cost
of electricity
|
2,922
|
2,410
|
2,770
|
|||||||
|
Cost
of natural gas
|
2,097
|
2,191
|
1,724
|
|||||||
|
Operating
and maintenance
|
3,703
|
3,397
|
2,871
|
|||||||
|
Recognition
of regulatory assets
|
-
|
-
|
(4,900
|
)
|
||||||
|
Depreciation,
amortization, and decommissioning
|
1,709
|
1,735
|
1,497
|
|||||||
|
Total
operating expenses
|
10,431
|
9,733
|
3,962
|
|||||||
|
Operating
Income
|
2,108
|
1,970
|
7,118
|
|||||||
|
Interest
income
|
188
|
80
|
63
|
|||||||
|
Interest
expense
|
(738
|
)
|
(583
|
)
|
(797
|
)
|
||||
|
Other
expense, net
|
(13
|
)
|
(19
|
)
|
(98
|
)
|
||||
|
Income
Before Income Taxes
|
1,545
|
1,448
|
6,286
|
|||||||
|
Income
tax provision
|
554
|
544
|
2,466
|
|||||||
|
Income
From Continuing Operations
|
991
|
904
|
3,820
|
|||||||
|
Discontinued
Operations
|
||||||||||
|
Gain
on disposal of NEGT (net of income tax benefit of $13 million in
2005 and
income tax expense of $374 million in 2004)
|
-
|
13
|
684
|
|||||||
|
Net
Income
|
$
|
991
|
$
|
917
|
$
|
4,504
|
||||
|
Weighted
Average Common Shares Outstanding, Basic
|
346
|
372
|
398
|
|||||||
|
Earnings
Per Common Share from Continuing Operations,
Basic
|
$
|
2.78
|
$
|
2.37
|
$
|
9.16
|
||||
|
Net
Earnings Per Common Share, Basic
|
$
|
2.78
|
$
|
2.40
|
$
|
10.80
|
||||
|
Earnings
Per Common Share from Continuing Operations,
Diluted
|
$
|
2.76
|
$
|
2.34
|
$
|
8.97
|
||||
|
Net
Earnings Per Common Share, Diluted
|
$
|
2.76
|
$
|
2.37
|
$
|
10.57
|
||||
|
Dividends
Declared Per Common Share
|
$
|
1.32
|
$
|
1.23
|
$
|
-
|
||||
|
|
Balance
at December 31,
|
||||||
|
|
2006
|
2005
|
|||||
|
ASSETS
|
|
|
|||||
|
Current
Assets
|
|
|
|||||
|
Cash
and cash equivalents
|
$
|
456
|
$
|
713
|
|||
|
Restricted
cash
|
1,415
|
1,546
|
|||||
|
Accounts
receivable:
|
|||||||
|
Customers
(net of allowance for doubtful accounts of $50 million in 2006 and
$77
million in 2005)
|
2,343
|
2,422
|
|||||
|
Regulatory
balancing accounts
|
607
|
727
|
|||||
|
Inventories:
|
|||||||
|
Gas
stored underground and fuel oil
|
181
|
231
|
|||||
|
Materials
and supplies
|
149
|
133
|
|||||
|
Income
taxes receivable
|
-
|
21
|
|||||
|
Prepaid
expenses and other
|
716
|
187
|
|||||
|
Total
current assets
|
5,867
|
5,980
|
|||||
|
Property,
Plant and Equipment
|
|||||||
|
Electric
|
24,036
|
22,482
|
|||||
|
Gas
|
9,115
|
8,794
|
|||||
|
Construction
work in progress
|
1,047
|
738
|
|||||
|
Other
|
16
|
16
|
|||||
|
Total
property, plant and equipment
|
34,214
|
32,030
|
|||||
|
Accumulated
depreciation
|
(12,429
|
)
|
(12,075
|
)
|
|||
|
Net
property, plant and equipment
|
21,785
|
19,955
|
|||||
|
Other
Noncurrent Assets
|
|||||||
|
Regulatory
assets
|
4,902
|
5,578
|
|||||
|
Nuclear
decommissioning funds
|
1,876
|
1,719
|
|||||
|
Other
|
373
|
842
|
|||||
|
Total
other noncurrent assets
|
7,151
|
8,139
|
|||||
|
TOTAL
ASSETS
|
$
|
34,803
|
$
|
34,074
|
|||
|
|
Balance
at December 31,
|
||||||
|
|
2006
|
2005
|
|||||
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
|
|||||
|
Current
Liabilities
|
|
|
|||||
|
Short-term
borrowings
|
$
|
759
|
$
|
260
|
|||
|
Long-term
debt, classified as current
|
281
|
2
|
|||||
|
Rate
reduction bonds, classified as current
|
290
|
290
|
|||||
|
Energy
recovery bonds, classified as current
|
340
|
316
|
|||||
|
Accounts
payable:
|
|||||||
|
Trade
creditors
|
1,075
|
980
|
|||||
|
Disputed
claims and customer refunds
|
1,709
|
1,733
|
|||||
|
Regulatory
balancing accounts
|
1,030
|
840
|
|||||
|
Other
|
420
|
441
|
|||||
|
Interest
payable
|
583
|
473
|
|||||
|
Income
taxes payable
|
102
|
-
|
|||||
|
Deferred
income taxes
|
148
|
181
|
|||||
|
Other
|
1,513
|
1,416
|
|||||
|
Total
current liabilities
|
8,250
|
6,932
|
|||||
|
Noncurrent
Liabilities
|
|||||||
|
Long-term
debt
|
6,697
|
6,976
|
|||||
|
Rate
reduction bonds
|
-
|
290
|
|||||
|
Energy
recovery bonds
|
1,936
|
2,276
|
|||||
|
Regulatory
liabilities
|
3,392
|
3,506
|
|||||
|
Asset
retirement obligations
|
1,466
|
1,587
|
|||||
|
Deferred
income taxes
|
2,840
|
3,092
|
|||||
|
Deferred
tax credits
|
106
|
112
|
|||||
|
Other
|
2,053
|
1,833
|
|||||
|
Total
noncurrent liabilities
|
18,490
|
19,672
|
|||||
|
Commitments
and Contingencies
|
|||||||
|
Preferred
Stock of Subsidiaries
|
252
|
252
|
|||||
|
Preferred
Stock
|
|||||||
|
Preferred
stock, no par value, 80,000,000 shares, $100 par value, 5,000,000
shares,
none issued
|
-
|
-
|
|||||
|
Common
Shareholders' Equity
|
|||||||
|
Common
stock, no par value, authorized 800,000,000 shares, issued 372,803,521
common and 1,377,538 restricted shares in 2006 and issued 366,868,512
common and 1,399,990 restricted shares in 2005
|
5,877
|
5,827
|
|||||
|
Common
stock held by subsidiary, at cost, 24,665,500 shares
|
(718
|
)
|
(718
|
)
|
|||
|
Unearned
compensation
|
-
|
(22
|
)
|
||||
|
Reinvested
earnings
|
2,671
|
2,139
|
|||||
|
Accumulated
other comprehensive loss
|
(19
|
)
|
(8
|
)
|
|||
|
Total
common shareholders' equity
|
7,811
|
7,218
|
|||||
|
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
34,803
|
$
|
34,074
|
|||
|
|
Year
ended December 31,
|
|||||||||
|
|
2006
|
2005
|
2004
|
|||||||
|
Cash
Flows From Operating Activities
|
|
|
|
|||||||
|
Net
income
|
$
|
991
|
$
|
917
|
$
|
4,504
|
||||
|
Gain
on disposal of NEGT (net of income tax benefit of $13 million in
2005 and
income tax expense of $374 million in 2004)
|
-
|
(13
|
)
|
(684
|
)
|
|||||
|
Net
income from continuing operations
|
991
|
904
|
3,820
|
|||||||
|
Adjustments
to reconcile net income to net cash provided by operating activities:
|
||||||||||
|
Depreciation,
amortization, decommissioning and allowance for equity funds used
during
construction
|
1,756
|
1,698
|
1,497
|
|||||||
|
Loss
from retirement of long-term debt
|
-
|
-
|
65
|
|||||||
|
Tax
benefit from employee stock plans
|
-
|
50
|
41
|
|||||||
|
Gain
on sale of assets
|
(11
|
)
|
-
|
(19
|
)
|
|||||
|
Recognition
of regulatory assets
|
-
|
-
|
(4,900
|
)
|
||||||
|
Deferred
income taxes and tax credits, net
|
(285
|
)
|
(659
|
)
|
2,607
|
|||||
|
Other
deferred charges and noncurrent liabilities
|
151
|
33
|
(519
|
)
|
||||||
|
Net
effect of changes in operating assets and liabilities:
|
||||||||||
|
Accounts
receivable
|
130
|
(245
|
)
|
(85
|
)
|
|||||
|
Inventories
|
32
|
(60
|
)
|
(12
|
)
|
|||||
|
Accounts
payable
|
17
|
257
|
273
|
|||||||
|
Accrued
taxes/income taxes receivable
|
124
|
(207
|
)
|
(122
|
)
|
|||||
|
Regulatory
balancing accounts, net
|
329
|
254
|
(590
|
)
|
||||||
|
Other
current assets
|
(273
|
)
|
29
|
760
|
||||||
|
Other
current liabilities
|
(233
|
)
|
273
|
(48
|
)
|
|||||
|
Payments
authorized by the Bankruptcy Court on amounts classified as liabilities
subject to compromise
|
-
|
-
|
(1,022
|
)
|
||||||
|
Other
|
(14
|
)
|
82
|
110
|
||||||
|
Net
cash provided by operating activities
|
2,714
|
2,409
|
1,856
|
|||||||
|
Cash
Flows From Investing Activities
|
||||||||||
|
Capital
expenditures
|
(2,402
|
)
|
(1,804
|
)
|
(1,559
|
)
|
||||
|
Net
proceeds from sale of assets
|
17
|
39
|
35
|
|||||||
|
Decrease
(increase) in restricted cash
|
115
|
434
|
(1,216
|
)
|
||||||
|
Proceeds from
nuclear decommissioning trust sales
|
1,087
|
2,918
|
1,821
|
|||||||
|
Purchases
of nuclear decommissioning trust investments
|
(1,244
|
)
|
(3,008
|
)
|
(1,972
|
)
|
||||
|
Other
|
-
|
23
|
(27
|
)
|
||||||
|
Net
cash used in investing activities
|
(2,427
|
)
|
(1,398
|
)
|
(2,918
|
)
|
||||
|
Cash
Flows From Financing Activities
|
||||||||||
|
Borrowings
under accounts receivable facility and working capital
facility
|
350
|
260
|
300
|
|||||||
|
Repayments
under accounts receivable facility and working capital
facility
|
(310
|
)
|
(300
|
)
|
-
|
|||||
|
Net
issuance of commercial paper, net of discount of $2
million
|
458
|
-
|
-
|
|||||||
|
Proceeds
from issuance of long-term debt, net of issuance costs of $3 million
in
2005 and $107 million in 2004
|
-
|
451
|
7,742
|
|||||||
|
Proceeds
from issuance of energy recovery bonds, net of issuance costs of
$21
million in 2005
|
-
|
2,711
|
-
|
|||||||
|
Long-term
debt matured, redeemed or repurchased
|
-
|
(1,556
|
)
|
(9,054
|
)
|
|||||
|
Rate
reduction bonds matured
|
(290
|
)
|
(290
|
)
|
(290
|
)
|
||||
|
Energy
recovery bonds matured
|
(316
|
)
|
(140
|
)
|
-
|
|||||
|
Preferred
stock with mandatory redemption provisions redeemed
|
-
|
(122
|
)
|
(15
|
)
|
|||||
|
Preferred
stock without mandatory redemption provisions redeemed
|
-
|
(37
|
)
|
-
|
||||||
|
Common
stock issued
|
131
|
243
|
162
|
|||||||
|
Common
stock repurchased
|
(114
|
)
|
(2,188
|
)
|
(378
|
)
|
||||
|
Common
stock dividends paid
|
(456
|
)
|
(334
|
)
|
-
|
|||||
|
Other
|
3
|
32
|
(91
|
)
|
||||||
|
Net
cash used in financing activities
|
(544
|
)
|
(1,270
|
)
|
(1,624
|
)
|
||||
|
Net
change in cash and cash equivalents
|
(257
|
)
|
(259
|
)
|
(2,686
|
)
|
||||
|
Cash
and cash equivalents at January 1
|
713
|
972
|
3,658
|
|||||||
|
|
||||||||||
|
Cash
and cash equivalents at December 31
|
$
|
456
|
$
|
713
|
$
|
972
|
||||
|
Supplemental
disclosures of cash flow information
|
||||||||||
|
Cash
received for:
|
||||||||||
|
Reorganization
interest income
|
$
|
-
|
$
|
-
|
$
|
16
|
||||
|
Cash
paid for:
|
||||||||||
|
Interest
(net of amounts capitalized)
|
503
|
403
|
646
|
|||||||
|
Income
taxes paid, net
|
736
|
1,392
|
128
|
|||||||
|
Reorganization
professional fees and expenses
|
-
|
-
|
61
|
|||||||
|
Supplemental
disclosures of noncash investing and financing
activities
|
||||||||||
|
Common
stock dividends declared but not yet paid
|
$
|
117
|
$
|
115
|
$
|
-
|
||||
|
Transfer
of liabilities and other payables subject to compromise to operating
assets and liabilities
|
-
|
-
|
(2,877
|
)
|
||||||
|
Assumption
of capital lease obligation
|
408
|
-
|
-
|
|||||||
|
Transfer
of Gateway Generating Station asset
|
69
|
-
|
-
|
|
Common
Stock Shares
|
Common
Stock Amount
|
Common
Stock Held by
Subsidiary
|
Unearned
Compen-sation
|
Reinvested
Earnings (Accumulated Deficit)
|
Accumulated
Other Comprehensive Income (Loss)
|
Total
Common Share-holders' Equity
|
Comprehensive
Income (Loss)
|
||||||||||||||||||
|
Balance
at December 31, 2003
|
416,520,282
|
$
|
6,468
|
$
|
(690
|
)
|
$
|
(20
|
)
|
$
|
(1,458
|
)
|
$
|
(85
|
)
|
$
|
4,215
|
||||||||
|
|
|||||||||||||||||||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
4,504
|
-
|
4,504
|
$
|
4,504
|
||||||||||||||||
|
Mark-to-market
adjustments for hedging transactions in accordance with SFAS No.
133 (net
of income tax expense of $2 million)
|
-
|
-
|
-
|
-
|
-
|
3
|
3
|
3
|
|||||||||||||||||
|
NEGT
losses reclassified to earnings upon elimination of equity interest
by
PG&E Corporation (net of income tax expense of $43
million)
|
-
|
-
|
-
|
-
|
-
|
77
|
77
|
77
|
|||||||||||||||||
|
Other
|
-
|
-
|
-
|
-
|
-
|
1
|
1
|
1
|
|||||||||||||||||
|
Comprehensive
income
|
$
|
4,585
|
|||||||||||||||||||||||
|
Common
stock issued
|
8,410,058
|
162
|
-
|
-
|
-
|
-
|
162
|
||||||||||||||||||
|
Common
stock repurchased
|
(10,783,200
|
)
|
(167
|
)
|
-
|
-
|
(183
|
)
|
-
|
(350
|
)
|
||||||||||||||
|
Common
stock held by subsidiary
|
-
|
-
|
(28
|
)
|
-
|
-
|
-
|
(28
|
)
|
||||||||||||||||
|
Common
stock warrants exercised
|
4,003,812
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
|
Common
restricted stock issued
|
498,910
|
16
|
-
|
(16
|
)
|
-
|
-
|
-
|
|||||||||||||||||
|
Common
restricted stock cancelled
|
(33,721
|
)
|
(1
|
)
|
-
|
1
|
-
|
-
|
-
|
||||||||||||||||
|
Common
restricted stock amortization
|
-
|
-
|
-
|
9
|
-
|
-
|
9
|
||||||||||||||||||
|
Tax
benefit from employee stock plans
|
-
|
41
|
-
|
-
|
-
|
-
|
41
|
||||||||||||||||||
|
Other
|
-
|
(1
|
)
|
-
|
-
|
-
|
-
|
(1
|
)
|
||||||||||||||||
|
Balance
at December 31, 2004
|
418,616,141
|
6,518
|
(718
|
)
|
(26
|
)
|
2,863
|
(4
|
)
|
8,633
|
|||||||||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
917
|
-
|
917
|
917
|
|||||||||||||||||
|
Minimum
pension liability adjustment (net of income tax benefit of $3
million)
|
-
|
-
|
-
|
-
|
-
|
(4
|
)
|
(4
|
)
|
(4
|
)
|
||||||||||||||
|
Comprehensive
income
|
$
|
913
|
|||||||||||||||||||||||
|
Common
stock issued
|
10,264,535
|
247
|
-
|
-
|
-
|
-
|
247
|
||||||||||||||||||
|
Common
stock repurchased
|
(61,139,700
|
)
|
(998
|
)
|
-
|
-
|
(1,190
|
)
|
-
|
(2,188
|
)
|
||||||||||||||
|
Common
stock warrants exercised
|
295,919
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
|
Common
restricted stock issued
|
347,710
|
13
|
-
|
(13
|
)
|
-
|
-
|
-
|
|||||||||||||||||
|
Common
restricted stock cancelled
|
(116,103
|
)
|
(4
|
)
|
-
|
4
|
-
|
-
|
-
|
||||||||||||||||
|
Common
restricted stock amortization
|
-
|
-
|
-
|
13
|
-
|
-
|
13
|
||||||||||||||||||
|
Common
stock dividends declared and paid
|
-
|
-
|
-
|
-
|
(334
|
)
|
-
|
(334
|
)
|
||||||||||||||||
|
Common
stock dividends declared but not yet paid
|
-
|
-
|
-
|
-
|
(115
|
)
|
-
|
(115
|
)
|
||||||||||||||||
|
Tax
benefit from employee stock plans
|
-
|
50
|
-
|
-
|
-
|
-
|
50
|
||||||||||||||||||
|
Other
|
-
|
1
|
-
|
-
|
(2
|
)
|
-
|
(1
|
)
|
||||||||||||||||
|
Balance
at December 31, 2005
|
368,268,502
|
5,827
|
(718
|
)
|
(22
|
)
|
2,139
|
(8
|
)
|
7,218
|
|||||||||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
991
|
-
|
991
|
$
|
991
|
||||||||||||||||
|
Comprehensive
income
|
$
|
991
|
|||||||||||||||||||||||
|
|
|||||||||||||||||||||||||
|
Common
stock issued
|
5,399,707
|
110
|
-
|
-
|
-
|
-
|
110
|
||||||||||||||||||
|
ASR
settlement of stock repurchased in 2005
|
-
|
(114
|
)
|
-
|
-
|
-
|
-
|
(114
|
)
|
||||||||||||||||
|
Common
stock warrants exercised
|
51,890
|
-
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||
|
Common
restricted stock, unearned compensation reversed in accordance with
SFAS
No. 123R
|
-
|
(22
|
)
|
-
|
22
|
-
|
-
|
-
|
|||||||||||||||||
|
Common
restricted stock issued
|
566,255
|
21
|
-
|
-
|
-
|
-
|
21
|
||||||||||||||||||
|
Common
restricted stock cancelled
|
(105,295
|
)
|
(1
|
)
|
-
|
-
|
-
|
-
|
(1
|
)
|
|||||||||||||||
|
Common
restricted stock amortization
|
-
|
20
|
-
|
-
|
-
|
-
|
20
|
|
Common
stock dividends declared and paid
|
-
|
-
|
-
|
-
|
(342
|
)
|
-
|
(342
|
)
|
|||||||||||||
|
Common
stock dividends declared but not yet paid
|
-
|
-
|
-
|
-
|
(117
|
)
|
-
|
(117
|
)
|
|||||||||||||
|
Tax
benefit from employee stock plans
|
-
|
35
|
-
|
-
|
-
|
-
|
35
|
|||||||||||||||
|
Adoption
of SFAS No. 158 (net of income tax benefit of $8 million)
|
-
|
-
|
-
|
-
|
-
|
(11
|
)
|
(11
|
)
|
|||||||||||||
|
Other
|
-
|
1
|
-
|
-
|
-
|
-
|
1
|
|||||||||||||||
|
Balance
at December 31, 2006
|
374,181,059
|
$
|
5,877
|
$
|
(718
|
)
|
$
|
-
|
$
|
2,671
|
$
|
(19
|
)
|
$
|
7,811
|
|
|
Year
ended December 31,
|
|||||||||
|
|
2006
|
2005
|
2004
|
|||||||
|
Operating
Revenues
|
|
|
|
|||||||
|
Electric
|
$
|
8,752
|
$
|
7,927
|
$
|
7,867
|
||||
|
Natural
gas
|
3,787
|
3,777
|
3,213
|
|||||||
|
Total
operating revenues
|
12,539
|
11,704
|
11,080
|
|||||||
|
Operating
Expenses
|
||||||||||
|
Cost
of electricity
|
2,922
|
2,410
|
2,770
|
|||||||
|
Cost
of natural gas
|
2,097
|
2,191
|
1,724
|
|||||||
|
Operating
and maintenance
|
3,697
|
3,399
|
2,848
|
|||||||
|
Recognition
of regulatory assets
|
-
|
-
|
(4,900
|
)
|
||||||
|
Depreciation,
amortization and decommissioning
|
1,708
|
1,734
|
1,494
|
|||||||
|
Total
operating expenses
|
10,424
|
9,734
|
3,936
|
|||||||
|
Operating
Income
|
2,115
|
1,970
|
7,144
|
|||||||
|
Interest
income
|
175
|
76
|
50
|
|||||||
|
Interest
expense
|
(710
|
)
|
(554
|
)
|
(667
|
)
|
||||
|
Other
income, net
|
7
|
16
|
16
|
|||||||
|
Income
Before Income Taxes
|
1,587
|
1,508
|
6,543
|
|||||||
|
Income
tax provision
|
602
|
574
|
2,561
|
|||||||
|
Net
Income
|
985
|
934
|
3,982
|
|||||||
|
Preferred
stock dividend requirement
|
14
|
16
|
21
|
|||||||
|
Income
Available for Common Stock
|
$
|
971
|
$
|
918
|
$
|
3,961
|
||||
|
|
Balance
at December 31,
|
||||||
|
|
2006
|
2005
|
|||||
|
ASSETS
|
|
|
|||||
|
Current
Assets
|
|
|
|||||
|
Cash
and cash equivalents
|
$
|
70
|
$
|
463
|
|||
|
Restricted
cash
|
1,415
|
1,546
|
|||||
|
Accounts
receivable:
|
|||||||
|
Customers
(net of allowance for doubtful accounts of $50 million in 2006 and
$77
million in 2005)
|
2,343
|
2,422
|
|||||
|
Related
parties
|
6
|
3
|
|||||
|
Regulatory
balancing accounts
|
607
|
727
|
|||||
|
Inventories:
|
|||||||
|
Gas
stored underground and fuel oil
|
181
|
231
|
|||||
|
Materials
and supplies
|
149
|
133
|
|||||
|
Income
taxes receivable
|
20
|
48
|
|||||
|
Prepaid
expenses and other
|
714
|
183
|
|||||
|
Total
current assets
|
5,505
|
5,756
|
|||||
|
Property,
Plant and Equipment
|
|||||||
|
Electric
|
24,036
|
22,482
|
|||||
|
Gas
|
9,115
|
8,794
|
|||||
|
Construction
work in progress
|
1,047
|
738
|
|||||
|
Total
property, plant and equipment
|
34,198
|
32,014
|
|||||
|
Accumulated
depreciation
|
(12,415
|
)
|
(12,061
|
)
|
|||
|
Net
property, plant and equipment
|
21,783
|
19,953
|
|||||
|
Other
Noncurrent Assets
|
|||||||
|
Regulatory
assets
|
4,902
|
5,578
|
|||||
|
Nuclear
decommissioning funds
|
1,876
|
1,719
|
|||||
|
Related
parties receivable
|
25
|
23
|
|||||
|
Other
|
280
|
754
|
|||||
|
Total
other noncurrent assets
|
7,083
|
8,074
|
|||||
|
TOTAL
ASSETS
|
$
|
34,371
|
$
|
33,783
|
|||
|
|
Balance
at December 31,
|
||||||
|
|
2006
|
2005
|
|||||
|
LIABILITIES
AND SHAREHOLDERS' EQUITY
|
|
|
|||||
|
Current
Liabilities
|
|
|
|||||
|
Short-term
borrowings
|
$
|
759
|
$
|
260
|
|||
|
Long-term
debt, classified as current
|
1
|
2
|
|||||
|
Rate
reduction bonds, classified as current
|
290
|
290
|
|||||
|
Energy
recovery bonds, classified as current
|
340
|
316
|
|||||
|
Accounts
payable:
|
|||||||
|
Trade
creditors
|
1,075
|
980
|
|||||
|
Disputed
claims and customer refunds
|
1,709
|
1,733
|
|||||
|
Related
parties
|
40
|
37
|
|||||
|
Regulatory
balancing accounts
|
1,030
|
840
|
|||||
|
Other
|
402
|
423
|
|||||
|
Interest
payable
|
570
|
460
|
|||||
|
Deferred
income taxes
|
118
|
161
|
|||||
|
Other
|
1,346
|
1,255
|
|||||
|
Total
current liabilities
|
7,680
|
6,757
|
|||||
|
Noncurrent
Liabilities
|
|||||||
|
Long-term
debt
|
6,697
|
6,696
|
|||||
|
Rate
reduction bonds
|
-
|
290
|
|||||
|
Energy
recovery bonds
|
1,936
|
2,276
|
|||||
|
Regulatory
liabilities
|
3,392
|
3,506
|
|||||
|
Asset
retirement obligations
|
1,466
|
1,587
|
|||||
|
Deferred
income taxes
|
2,972
|
3,218
|
|||||
|
Deferred
tax credits
|
106
|
112
|
|||||
|
Other
|
1,922
|
1,691
|
|||||
|
Total
noncurrent liabilities
|
18,491
|
19,376
|
|||||
|
Commitments
and Contingencies (Notes 2, 4, 5, 6, 8, 9, 13, 15 and
17)
|
|||||||
|
Shareholders'
Equity
|
|||||||
|
Preferred
stock without mandatory redemption provisions:
|
|||||||
|
Nonredeemable,
5.00% to 6.00%, outstanding 5,784,825 shares
|
145
|
145
|
|||||
|
Redeemable,
4.36% to 5.00%, outstanding 4,534,958 shares
|
113
|
113
|
|||||
|
Common
stock, $5 par value, authorized 800,000,000 shares, issued 279,624,823
shares in 2006 and 2005
|
1,398
|
1,398
|
|||||
|
Common
stock held by subsidiary, at cost, 19,481,213 shares
|
(475
|
)
|
(475
|
)
|
|||
|
Additional
paid-in capital
|
1,822
|
1,776
|
|||||
|
Reinvested
earnings
|
5,213
|
4,702
|
|||||
|
Accumulated
other comprehensive loss
|
(16
|
)
|
(9
|
)
|
|||
|
Total
shareholders' equity
|
8,200
|
7,650
|
|||||
|
TOTAL
LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
34,371
|
$
|
33,783
|
|||
|
|
Year
ended December 31,
|
|||||||||
|
|
2006
|
2005
|
2004
|
|||||||
|
Cash
Flows From Operating Activities
|
|
|
|
|||||||
|
Net
income
|
$
|
985
|
$
|
934
|
$
|
3,982
|
||||
|
Adjustments
to reconcile net income to net cash provided by operating activities:
|
||||||||||
|
Depreciation,
amortization, decommissioning and allowance for equity funds used
during
construction
|
1,755
|
1,697
|
1,494
|
|||||||
|
Gain
on sale of assets
|
(11
|
)
|
-
|
-
|
||||||
|
Recognition
of regulatory assets
|
-
|
-
|
(4,900
|
)
|
||||||
|
Deferred
income taxes and tax credits, net
|
(287
|
)
|
(636
|
)
|
2,580
|
|||||
|
Other
deferred charges and noncurrent liabilities
|
116
|
21
|
(391
|
)
|
||||||
|
Net
effect of changes in operating assets and liabilities:
|
||||||||||
|
Accounts
receivable
|
128
|
(245
|
)
|
(85
|
)
|
|||||
|
Inventories
|
34
|
(60
|
)
|
(12
|
)
|
|||||
|
Accounts
payable
|
21
|
257
|
273
|
|||||||
|
Accrued
taxes/income taxes receivable
|
28
|
(150
|
)
|
52
|
||||||
|
Regulatory
balancing accounts, net
|
329
|
254
|
(590
|
)
|
||||||
|
Other
current assets
|
(273
|
)
|
2
|
55
|
||||||
|
Other
current liabilities
|
(235
|
)
|
273
|
395
|
||||||
|
Payments
authorized by the Bankruptcy Court on amounts classified as liabilities
subject to compromise
|
-
|
-
|
(1,022
|
)
|
||||||
|
Other
|
(13
|
)
|
19
|
7
|
||||||
|
Net
cash provided by operating activities
|
2,577
|
2,366
|
1,838
|
|||||||
|
Cash
Flows From Investing Activities
|
||||||||||
|
Capital
expenditures
|
(2,402
|
)
|
(1,803
|
)
|
(1,559
|
)
|
||||
|
Net
proceeds from sale of assets
|
17
|
39
|
35
|
|||||||
|
Decrease
(increase) in restricted cash
|
115
|
434
|
(1,577
|
)
|
||||||
|
Proceeds from
nuclear decommissioning trust sales
|
1,087
|
2,918
|
1,821
|
|||||||
|
Purchases of
nuclear decommissioning trust investments
|
(1,244
|
)
|
(3,008
|
)
|
(1,972
|
)
|
||||
|
Other
|
1
|
61
|
(27
|
)
|
||||||
|
Net
cash used in investing activities
|
(2,426
|
)
|
(1,359
|
)
|
(3,279
|
)
|
||||
|
Cash
Flows From Financing Activities
|
||||||||||
|
Borrowings
under accounts receivable facility and working capital
facility
|
350
|
260
|
300
|
|||||||
|
Repayments
under accounts receivable facility and working capital
facility
|
(310
|
)
|
(300
|
)
|
-
|
|||||
|
Net
issuance of commercial paper, net of discount of $2
million
|
458
|
-
|
-
|
|||||||
|
Proceeds
from issuance of long-term debt, net of issuance costs of $3 million
in
2005 and $107 million in 2004
|
-
|
451
|
7,742
|
|||||||
|
Proceeds
from issuance of energy recovery bonds, net of issuance costs of
$21
million in 2005
|
-
|
2,711
|
-
|
|||||||
|
Long-term
debt matured, redeemed or repurchased
|
-
|
(1,554
|
)
|
(8,402
|
)
|
|||||
|
Rate
reduction bonds matured
|
(290
|
)
|
(290
|
)
|
(290
|
)
|
||||
|
Energy
recovery bonds matured
|
(316
|
)
|
(140
|
)
|
-
|
|||||
|
Preferred
stock dividends paid
|
(14
|
)
|
(16
|
)
|
(90
|
)
|
||||
|
Common
stock dividends paid
|
(460
|
)
|
(445
|
)
|
-
|
|||||
|
Preferred
stock with mandatory redemption provisions redeemed
|
-
|
(122
|
)
|
(15
|
)
|
|||||
|
Preferred
stock without mandatory redemption provisions redeemed
|
-
|
(37
|
)
|
-
|
||||||
|
Common
stock repurchased
|
-
|
(1,910
|
)
|
-
|
||||||
|
Other
|
38
|
65
|
-
|
|||||||
|
Net
cash used in financing activities
|
(544
|
)
|
(1,327
|
)
|
(755
|
)
|
||||
|
Net
change in cash and cash equivalents
|
(393
|
)
|
(320
|
)
|
(2,196
|
)
|
||||
|
Cash
and cash equivalents at January 1
|
463
|
783
|
2,979
|
|||||||
|
Cash
and cash equivalents at December 31
|
$
|
70
|
$
|
463
|
$
|
783
|
||||
|
Supplemental
disclosures of cash flow information
|
||||||||||
|
Cash
received for:
|
||||||||||
|
Reorganization
interest income
|
$
|
-
|
$
|
-
|
$
|
16
|
||||
|
Cash
paid for:
|
||||||||||
|
Interest
(net of amounts capitalized)
|
476
|
390
|
512
|
|||||||
|
Income
taxes paid, net
|
897
|
1,397
|
109
|
|||||||
|
Reorganization
professional fees and expenses
|
-
|
-
|
61
|
|||||||
|
Supplemental
disclosures of noncash investing and financing
activities
|
||||||||||
|
Transfer
of liabilities and other payables subject to compromise to operating
assets and liabilities
|
$
|
-
|
$
|
-
|
$
|
(2,877
|
)
|
|||
|
Equity
contribution for settlement of plan of reorganization, or POR,
payable
|
-
|
-
|
(129
|
)
|
||||||
|
Assumption
of capital lease obligation
|
408
|
-
|
-
|
|||||||
|
Transfer
of Gateway Generating Station asset
|
69
|
-
|
-
|
|
Preferred
Stock Without Mandatory Redemption Provisions
|
Common
Stock
|
Additional
Paid-in Capital
|
Common
Stock Held by Subsidiary
|
Reinvested
Earnings
|
Accumu-
lated Other Compre- hensive Income (Loss)
|
Total
Share- holders' Equity
|
Comprehensive
Income (Loss)
|
||||||||||||||||||
|
Balance
at December 31, 2003
|
$
|
294
|
$
|
1,606
|
$
|
1,964
|
$
|
(475
|
)
|
$
|
1,706
|
$
|
(6
|
)
|
$
|
5,089
|
|||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
3,982
|
-
|
3,982
|
$
|
3,982
|
||||||||||||||||
|
Mark-to-market
adjustments for hedging transactions in accordance with SFAS No.
133 (net
of income tax expense of $2 million)
|
-
|
-
|
-
|
-
|
-
|
3
|
3
|
3
|
|||||||||||||||||
|
Comprehensive
income
|
$
|
3,985
|
|||||||||||||||||||||||
|
|
|||||||||||||||||||||||||
|
Equity
contribution for settlement of POR payable (net of income taxes of
$52
million)
|
-
|
-
|
77
|
-
|
-
|
-
|
77
|
||||||||||||||||||
|
Preferred
stock dividend
|
-
|
-
|
-
|
-
|
(21
|
)
|
-
|
(21
|
)
|
||||||||||||||||
|
Balance
at December 31, 2004
|
294
|
1,606
|
2,041
|
(475
|
)
|
5,667
|
(3
|
)
|
9,130
|
||||||||||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
934
|
-
|
934
|
$
|
934
|
||||||||||||||||
|
Minimum
pension liability adjustment (net of income tax benefit of $4
million)
|
-
|
-
|
-
|
-
|
-
|
(6
|
)
|
(6
|
)
|
(6
|
)
|
||||||||||||||
|
Comprehensive
income
|
$
|
928
|
|||||||||||||||||||||||
|
|
|||||||||||||||||||||||||
|
Common
stock repurchased
|
-
|
(208
|
)
|
(266
|
)
|
-
|
(1,436
|
)
|
-
|
(1,910
|
)
|
||||||||||||||
|
Common
stock dividend
|
-
|
-
|
-
|
-
|
(445
|
)
|
-
|
(445
|
)
|
||||||||||||||||
|
Preferred
stock redeemed
|
(36
|
)
|
-
|
1
|
-
|
(2
|
)
|
-
|
(37
|
)
|
|||||||||||||||
|
Preferred
stock dividend
|
-
|
-
|
-
|
-
|
(16
|
)
|
-
|
(16
|
)
|
||||||||||||||||
|
Balance
at December 31, 2005
|
258
|
1,398
|
1,776
|
(475
|
)
|
4,702
|
(9
|
)
|
7,650
|
||||||||||||||||
|
Net
income
|
-
|
-
|
-
|
-
|
985
|
-
|
985
|
$
|
985
|
||||||||||||||||
|
Minimum
pension liability adjustment (net of income tax expense of $2
million)
|
-
|
-
|
-
|
-
|
-
|
3
|
3
|
3
|
|||||||||||||||||
|
Comprehensive
income
|
$
|
988
|
|||||||||||||||||||||||
|
|
|||||||||||||||||||||||||
|
Tax
benefit from employee stock plans
|
-
|
-
|
46
|
-
|
-
|
-
|
46
|
||||||||||||||||||
|
Common
stock dividend
|
-
|
-
|
-
|
-
|
(460
|
)
|
-
|
(460
|
)
|
||||||||||||||||
|
Preferred
stock dividend
|
-
|
-
|
-
|
-
|
(14
|
)
|
-
|
(14
|
)
|
||||||||||||||||
|
Adoption
of SFAS No. 158 (net of income tax benefit of $7 million)
|
-
|
-
|
-
|
-
|
-
|
(10
|
)
|
(10
|
)
|
||||||||||||||||
|
Balance
at December 31, 2006
|
$
|
258
|
$
|
1,398
|
$
|
1,822
|
$
|
(475
|
)
|
$
|
5,213
|
$
|
(16
|
)
|
$
|
8,200
|