INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The significant components of income tax provision (benefit) by taxing jurisdiction were as follows:

	PG&E Corporation						Utility
	Year Ended December 31,
(in millions)	2020		2019		2018		2020		2019		2018
Current:
Federal	$	(26)	$	1	$	(5)	$	(26)	$	4	$	5
State	(34)		101		(8)		(34)		94		(7)
Deferred:
Federal	258		(2,361)		(2,264)		290		(2,363)		(2,278)
State	171		(1,136)		(1,009)		185		(1,137)		(1,009)
Tax credits	(7)		(5)		(6)		(7)		(5)		(6)
Income tax provision (benefit)	$	362	$	(3,400)	$	(3,292)	$	408	$	(3,407)	$	(3,295)

Schedule of Deferred Tax Assets and Liabilities

The following tables describe net deferred income tax assets and liabilities:

	PG&E Corporation				Utility
	Year Ended December 31,
(in millions)	2020		2019		2020		2019
Deferred income tax assets:
Tax carryforwards	$	7,641	$	1,390	$	7,529	$	1,308
Compensation	187		151		109		92
Wildfire-related claims (1)	544		6,520		544		6,520
Operating lease liability	489		642		488		640
Other (2)	212		112		219		121
Total deferred income tax assets	$	9,073	$	8,815	$	8,889	$	8,681
Deferred income tax liabilities:
Property related basis differences	8,311		7,984		8,300		7,973
Regulatory balancing accounts	763		381		763		381
Debt financing costs	526		—		526		—
Operating lease right of use asset	489		642		488		640
Income tax regulatory asset(3)	254		71		254		71
Other (4)	128		57		128		58
Total deferred income tax liabilities	$	10,471	$	9,135	$	10,459	$	9,123
Total net deferred income tax liabilities	$	1,398	$	320	$	1,570	$	442

(1) Amounts primarily relate to wildfire-related claims, net of estimated insurance recoveries, and legal and other costs related to various wildfires that have occurred on PG&E Corporation’s and the Utility’s service territory over the past several years.

(2) Amounts include benefits, environmental reserve, and customer advances for construction. 

(3) Represents the tax gross up portion of the deferred income tax for the cumulative differences between amounts recognized for ratemaking purposes and amounts recognized for tax, including the impact of changes in net deferred taxes associated with a lower federal income tax rate as a result of the Tax Act.

(4) Amount primarily includes an environmental reserve.

Schedule of Effective Income Tax Rate Reconciliation

The following table reconciles income tax expense at the federal statutory rate to the income tax provision:

	PG&E Corporation						Utility
	Year Ended December 31,
	2020		2019		2018		2020		2019		2018
Federal statutory income tax rate	21.0	%	21.0	%	21.0	%	21.0	%	21.0	%	21.0	%
Increase (decrease) in income tax rate resulting from:
State income tax (net of federal benefit) (1)	(15.3)		7.5		7.9		19.1		7.5		7.9
Effect of regulatory treatment of fixed asset differences (2)	39.0		2.8		3.6		(44.9)		2.8		3.6
Tax credits	1.5		0.1		0.1		(1.7)		0.1		0.1
Bankruptcy and emergence (3)	(82.5)		—		—		54.1		—		—
Other, net (4)	(2.1)		(0.6)		(0.1)		2.2		(0.5)		—
Effective tax rate	(38.4)	%	30.8	%	32.5	%	49.8	%	30.9	%	32.6	%

(1) Includes the effect of state flow-through ratemaking treatment.

(2) Includes the effect of federal flow-through ratemaking treatment for certain property-related costs.  For these temporary tax differences, PG&E Corporation and the Utility recognize the deferred tax impact in the current period and record offsetting regulatory assets and liabilities.  Therefore, PG&E Corporation’s and the Utility’s effective tax rates are impacted as these differences arise and reverse.  PG&E Corporation and the Utility recognize such differences as regulatory assets or liabilities as it is probable that these amounts will be recovered from or returned to customers in future rates.  In 2020, 2019, and 2018, the amounts also reflect the impact of the amortization of excess deferred tax benefits to be refunded to customers as a result of the Tax Act passed in December 2017.

(3) The Utility includes an adjustment for the measurement of the deferred tax asset associated with the difference between the liability recorded related to the TCC RSA and the ultimate value of PG&E Corporation stock contributed to the Fire Victim Trust. PG&E Corporation includes the same adjustment as the Utility and a permanent non-deductible equity backstop premium expense. This combined with a pre-tax loss and a pre-tax income for PG&E Corporation and the Utility, respectively, accounts for the remaining difference.

(4) These amounts primarily represent the impact of tax audit settlements and non-tax deductible costs in 2020 and 2019.

Schedule of Change in Unrecognized Tax Benefits

The following table reconciles the changes in unrecognized tax benefits:

	PG&E Corporation						Utility
(in millions)	2020		2019		2018		2020		2019		2018
Balance at beginning of year	$	420	$	377	$	349	$	420	$	377	$	349
Reductions for tax position taken during a prior year	(43)		(1)		(27)		(43)		(1)		(27)
Additions for tax position taken during the current year	60		44		55		60		44		55
Settlements	—		—		—		—		—		—
Expiration of statute	—		—		—		—		—		—
Balance at end of year	$	437	$	420	$	377	$	437	$	420	$	377

Schedule of Operating Loss and Tax Credit Carryforward Balances

The following table describes PG&E Corporation’s operating loss and tax credit carryforward balances:

(in millions)	December 31, 2020		Expiration Year
Federal:
Net operating loss carryforward - Pre-2018	$	3,600	2031 - 2036
Net operating loss carryforward - Post-2017	24,887		N/A
Tax credit carryforward	134		2029 - 2040
State:
Net operating loss carryforward	$	25,364	2039 - 2040
Tax credit carryforward	100		Various