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FINWIRES

PG&E Plans $2 Billion Cut to 2027 Capital Spending

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PG&E (PCG) launched a strategic review of its businesses and plans to defer about $2 billion in planned investment in 2027 to reduce financing costs and strengthen its ability to fund California's growing energy needs, the company said in a statement on Wednesday.

The company said its revised 2027 capital plan would include about $11.4 billion in investment in California, down roughly $2 billion from its previous plan.

The reduction is expected to lower the company's debt financing needs by a similar amount and, in turn, reduce customers' financing costs.

PG&E said the changes are intended as a short-term measure while it evaluates longer-term options for the company amid financing risks tied to California's wildfire liability framework.

"Something has to change so that we can better serve our customers. That's why we're taking action today," PG&E Chief Executive Patti Poppe said in a statement.

The company's board has established a four-member Strategic Review Committee, composed of independent directors, to oversee the review.

PG&E said the process will consider regulatory, financial, operational and strategic alternatives, including potential changes to how the company is organized and financed.

A key objective will be to establish a financially stronger, investment-grade company capable of attracting lower-cost, long-term capital, PG&E said.

The review will also assess options aimed at maintaining the company's safety performance, improving customer affordability and strengthening the reliability and resiliency of California's energy system.

PG&E said any changes would honor existing labor agreements, pension commitments and claims obligations.

While reducing and delaying some planned investments, PG&E said it will continue funding critical safety programs and maintain current performance on compliance obligations, including its Wildfire Mitigation Plan and safety certification requirements.

The company reaffirmed its 2026 non-GAAP Core earnings guidance of $1.64 to $1.66 per share and initiated 2027 guidance of $1.78 to $1.82 per share.

As part of the strategic review, PG&E said it will reconsider its longer-term Core earnings-per-share growth target as well as its capital investment and rate-base outlooks for 2028 through 2030.

Price: $12.87, Change: $-1.20, Percent Change: -8.50%

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