FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis for PG&E Corporation and the Utility are summarized below. Assets held in rabbi trusts are held by PG&E Corporation and not the Utility.


	Fair Value Measurements
	At September 30, 2022
(in millions)	Level 1		Level 2		Level 3		Netting (1)		Total
Assets:
Short-term investments	$	160	$	—	$	—	$	—	$	160
Fixed-income securities	—		49		—		—		49
Nuclear decommissioning trusts
Short-term investments	103		—		—		—		103
Global equity securities	1,690		—		—		—		1,690
Fixed-income securities	1,057		806		—		—		1,863
Assets measured at NAV	—		—		—		—		23
Total nuclear decommissioning trusts (2)	2,850		806		—		—		3,679
Customer credit trust
Short-term investments	7		—		—		—		7
Global equity securities	251		—		—		—		251
Fixed-income securities	180		436		—		—		616
Total customer credit trust	438		436		—		—		874
Price risk management instruments (Note 9)
Electricity	—		32		205		22		259
Gas	—		27		—		39		66
Total price risk management instruments	—		59		205		61		325
Rabbi trusts
Short-term investments	25		—		—		—		25
Global equity securities	4		—		—		—		4
Fixed-income securities	—		68		—		—		68
Life insurance contracts	—		66		—		—		66
Total rabbi trusts	29		134		—		—		163
Long-term disability trust
Short-term investments	4		—		—		—		4
Assets measured at NAV	—		—		—		—		111
Total long-term disability trust	4		—		—		—		115
TOTAL ASSETS	$	3,481	$	1,484	$	205	$	61	$	5,365
Liabilities:
Price risk management instruments (Note 9)
Electricity	$	—	$	20	$	174	$	(22)	$	172
Gas	—		12		—		(2)		10
TOTAL LIABILITIES	$	—	$	32	$	174	$	(24)	$	182

(1) Includes the effect of the contractual ability to settle contracts under master netting agreements and cash collateral.

(2) Represents amount before deducting $530 million primarily related to deferred taxes on appreciation of investment value.


	Fair Value Measurements
	December 31, 2021
(in millions)	Level 1		Level 2		Level 3		Netting (1)		Total
Assets:
Short-term investments	$	289	$	—	$	—	$	—	$	289
Nuclear decommissioning trusts
Short-term investments	22		—		—		—		22
Global equity securities	2,504		—		—		—		2,504
Fixed-income securities	1,158		866		—		—		2,024
Assets measured at NAV	—		—		—		—		31
Total nuclear decommissioning trusts (2)	3,684		866		—		—		4,581
Price risk management instruments (Note 9)
Electricity	—		9		214		6		229
Gas	—		4		—		137		141
Total price risk management instruments	—		13		214		143		370
Rabbi trusts
Fixed-income securities	—		104		—		—		104
Life insurance contracts	—		76		—		—		76
Total rabbi trusts	—		180		—		—		180
Long-term disability trust
Short-term investments	6		—		—		—		6
Assets measured at NAV	—		—		—		—		132
Total long-term disability trust	6		—		—		—		138
TOTAL ASSETS	$	3,979	$	1,059	$	214	$	143	$	5,558
Liabilities:
Price risk management instruments (Note 9)
Electricity	—		11		248		(24)		235
Gas	—		10		—		(3)		7
TOTAL LIABILITIES	$	—	$	21	$	248	$	(27)	$	242

(1) Includes the effect of the contractual ability to settle contracts under master netting agreements and cash collateral.

(2) Represents amount before deducting $783 million, primarily related to deferred taxes on appreciation of investment value.

Fair Value Measurement Inputs and Valuation Techniques

Fair Value at

(in millions)

At September 30, 2022

Valuation
Technique

Unobservable
Input

Fair Value Measurement

Assets

Liabilities

Range (1)/Weighted-Average Price (2)

Congestion revenue rights

162

Market approach

CRR auction prices

$ (2,265.69) - 2,265.94 / 0.43

Power purchase agreements

Discounted cash flow

Forward prices

$ (6.91) - 210.05 / 59.52

(1) Represents price per megawatt-hour.

(2) Unobservable inputs were weighted by the relative fair value of the instruments.

Fair Value at

(in millions)

At December 31, 2021

Valuation
Technique

Unobservable
Input

Fair Value Measurement

Assets

Liabilities

Range (1)/Weighted-Average Price (2)

Congestion revenue rights

188

Market approach

CRR auction prices

$ (40.77) - 2,265.94 / 0.40

Power purchase agreements

155

Discounted cash flow

Forward prices

$ (7.97) - 256.20 / 47.17

(1) Represents price per megawatt-hour.

(2) Unobservable inputs were weighted by the relative fair value of the instruments.

Level 3 Reconciliation

The following table presents the reconciliation for Level 3 price risk management instruments for the three and nine months ended September 30, 2022 and 2021, respectively:


	Price Risk Management Instruments
(in millions)	2022		2021
Asset (Liability) balance as of July 1	$	11	$	(18)
Net realized and unrealized gains (losses):
Included in regulatory assets and liabilities or balancing accounts (1)	20		(62)
Asset (Liability) balance as of September 30	$	31	$	(80)

(1) The costs related to price risk management activities are recovered through rates. Accordingly, unrealized gains and losses are deferred in regulatory liabilities and assets and net income is not impacted.


	Price Risk Management Instruments
(in millions)	2022		2021
Liability balance as of January 1	$	(34)	$	(72)
Net realized and unrealized gains (losses):
Included in regulatory assets and liabilities or balancing accounts (1)	65		(8)
Asset (Liability) balance as of September 30	$	31	$	(80)

Carrying Amount and Fair Value of Financial Instruments

The carrying amount and fair value of PG&E Corporation’s and the Utility’s long-term debt instruments were as follows (the table below excludes financial instruments with carrying values that approximate their fair values):


	At September 30, 2022				At December 31, 2021
(in millions)	Carrying Amount		Level 2 Fair Value		Carrying Amount		Level 2 Fair Value
Debt (Note 5)
PG&E Corporation	$	4,616	$	4,302	$	4,619	$	4,796
Utility	33,726		27,420		31,816		35,803

Schedule of Unrealized Gains (Losses) Related to Available-for-sale Investments

The following table provides a summary of equity securities and available-for-sale debt securities:


(in millions)	Amortized Cost		Total Unrealized Gains		Total Unrealized Losses		Total Fair Value
As of September 30, 2022
Nuclear decommissioning trusts
Short-term investments	$	103	$	—	$	—	$	103
Global equity securities	427		1,314		(28)		1,713
Fixed-income securities	2,014		8		(159)		1,863
Total (1)	$	2,544	$	1,322	$	(187)	$	3,679
As of December 31, 2021
Nuclear decommissioning trusts
Short-term investments	$	22	$	—	$	—	$	22
Global equity securities	479		2,066		(10)		2,535
Fixed-income securities	1,938		98		(12)		2,024
Total (1)	$	2,439	$	2,164	$	(22)	$	4,581

(1) Represents amounts before deducting $530 million and $783 million as of September 30, 2022 and December 31, 2021, respectively, primarily related to deferred taxes on appreciation of investment value.

Schedule of Available for Sale Securities Table

The fair value of fixed-income securities by contractual maturity is as follows:


	As of
(in millions)	September 30, 2022
Less than 1 year	$	19
1–5 years	619
5–10 years	411
More than 10 years	814
Total maturities of fixed-income securities	$	1,863

The following table provides a summary of equity securities and available-for-sale debt securities:


(in millions)	Amortized Cost		Total Unrealized Gains		Total Unrealized Losses		Total Fair Value
As of September 30, 2022
Customer credit trust
Short-term investments	$	7	$	—	$	—	$	7
Global equity securities	284		2		(35)		251
Fixed-income securities	639		—		(23)		616
Total	$	930	$	2	$	(58)	$	874

Schedule of Activity for Debt and Equity Securities

The following table provides a summary of activity for the fixed-income and equity securities:


	Three Months Ended September 30,				Nine Months Ended September 30,
(in millions)	2022		2021		2022		2021
Proceeds from sales and maturities of nuclear decommissioning trust investments	$	766	$	224	$	2,135	$	1,176
Gross realized gains on securities	21		21		158		150
Gross realized losses on securities	(40)		(2)		(105)		(18)

The fair value of fixed-income securities by contractual maturity is as follows:


	As of
(in millions)	September 30, 2022
Less than 1 year	$	—
1–5 years	169
5–10 years	162
More than 10 years	285
Total maturities of fixed-income securities	$	616

The following table provides a summary of activity for the fixed-income and equity securities:


	2022
(in millions)	Three Months Ended September 30,		Nine Months Ended September 30,
Proceeds from sales and maturities of customer credit trust investments	$	79	$	79
Gross realized gains on securities	8		8
Gross realized losses on securities (1)	(18)		(18)

(1) Includes $7 million of impaired debt securities which were written-down to their respective fair values during the three and nine months ended September 30, 2022.