PACIFIC GAS & ELECTRIC Co

The following discussion presents PG&E Corporation’s and the Utility’s operating results for the three and nine months ended September 30, 2026 and 2025. See “Key Factors Affecting Financial Results” above for further discussion about factors that could affect future results of operations.

The consolidated results of operations consist primarily of results related to the Utility, which are discussed in the “Utility” section below. The following table provides a summary of income (loss) attributable to common shareholders for the three and nine months ended September 30, 2026 and 2025:

PG&E Corporation’s net loss primarily consists of interest expense on long-term debt.

Utility

The table below shows certain items from the Utility’s Condensed Consolidated Statements of Income for the three and nine months ended September 30, 2026 and 2025. In general, expenses the Utility is authorized to pass through directly to customers (such as costs to purchase electricity and natural gas, as well as costs to fund public purpose programs) and the corresponding amount of revenues collected to recover those pass-through costs do not impact net income.

Operating Revenues

The Utility’s electric and natural gas operating revenues decreased by $62 million, or 1%, in the three months ended September 30, 2026, compared to the same period in 2025. This decrease was primarily due to:

•approximately $140 million less in interim rate relief authorized in the 2023 WMCE proceeding (see “2023 WMCE Application” below) in the three months ended September 30, 2026, compared to the same period in 2025; and

•$111 million less in revenues to recover the cost of electricity in the three months ended September 30, 2026, compared to the same period in 2025. These costs are passed through to customers and do not impact net income.

•approximately $60 million in revenue reductions related to the 2022 WMCE proceeding in the three months ended September 30, 2025, with no comparable reductions in the same period in 2026.

The Utility’s electric and natural gas operating revenues increased by $840 million, or 5%, in the nine months ended September 30, 2026, compared to the same period in 2025. This increase was primarily due to:

•approximately $650 million in revenues authorized in the 2023 WMCE final decision (see “2023 WMCE Application” below) in the nine months ended September 30, 2026, with no comparable revenues in the same period in 2025. The revenues recognized are incremental to revenues previously recognized for interim rate relief;

•$252 million more in revenues to recover the cost of electricity in the nine months ended September 30, 2026, compared to the same period in 2025;

•approximately $140 million more in revenues authorized in the 2023 GRC in the nine months ended September 30, 2026, compared to the same period in 2025; and

•approximately $60 million in revenue reductions related to the 2022 WMCE proceeding in the nine months ended September 30, 2025, with no comparable reductions in the same period in 2026.

•approximately $380 million less in interim rate relief authorized in the 2023 WMCE proceeding (see “2023 WMCE Application” below) in the nine months ended September 30, 2026, compared to the same period in 2025.

Cost of Electricity

The Utility’s Cost of electricity includes the cost of power purchased from third parties (including renewable energy resources), fuel and associated transmission costs used in its own generation facilities, fuel and associated transmission costs supplied to other facilities under power purchase agreements, costs to comply with California’s cap-and-invest program, and realized gains and losses on price risk management activities. Cost of electricity also includes net energy sales (Utility owned and third parties’ generation) in the CAISO electricity markets and directly from third parties. These costs are passed through to customers and do not impact net income. See Note 8 of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1.

There were no material changes to the Cost of electricity in the three and nine months ended September 30, 2026, compared to the same periods in 2025.

Cost of Natural Gas

The Utility’s Cost of natural gas includes the costs of procurement, storage and transportation of natural gas, costs to comply with California’s cap-and-invest program and realized gains and losses on price risk management activities. These costs are passed through to customers and do not impact net income. See Note 8 of the Notes to the Condensed Consolidated Financial Statements in Part I, Item 1.

There were no material changes to the Cost of natural gas in the three and nine months ended September 30, 2026, compared to the same periods in 2025.

Operating and Maintenance

The Utility’s Operating and maintenance expenses decreased by $95 million, or 4%, in the three months ended September 30, 2026, compared to the same period in 2025. This decrease was primarily due to:

•approximately $140 million less in previously deferred expenses authorized through interim rate relief for the 2023 WMCE application (see “2023 WMCE Application” below) in the three months ended September 30, 2026, compared to the same period in 2025.

•approximately$70 million more in costs associated with extended operations at DCPP in the three months ended September 30, 2026, compared to the same period in 2025.

The Utility’s Operating and maintenance expenses increased by $54 million, or 1%, in the nine months ended September 30, 2026, compared to the same period in 2025. This increase was primarily due to:

•approximately $400 million morein costs due to recognition of previously deferred expenses authorized in the 2023 WMCE final decision (see “2023 WMCE Application” below) in the nine months ended September 30, 2026, with no comparable costs in the same period in 2025. The expenses are incremental to the expenses previously recognized in the 2023 WMCE application as part of interim rate relief; and

•approximately $30 million more in costs associated with extended operations at DCPP in the nine months ended September 30, 2026, compared to the same period in 2025.

•approximately $380 million less in previously deferred expenses authorized through interim rate relief for the 2023 WMCE application (see “2023 WMCE Application” below) in the nine months ended September 30, 2026, compared to the same period in 2025.

Wildfire-Related Claims, Net of Recoveries

The Utility’s Wildfire-related claims, net of recoveries decreased by $1 million, or 100%, and $100 million, or 100%, in the three and nine months ended September 30, 2026, compared to the same periods in 2025. The Utility recognized pre-tax charges of $100 million related to the 2019 Kincade fire in the nine months ended September 30, 2025, with no comparable costs in the same period in 2026.

Wildfire Fund Expense

The Utility’s Wildfire Fund expense increased by $55 million, or 64%, and $98 million, or 36%, in the three and nine months ended September 30, 2026, compared to the same periods in 2025. These increases were primarily due to accelerated amortization associated with SCE’s disclosure of a receivable from the Wildfire Fund related to the Eaton fire, with no comparable costs in the same periods in 2025.

Depreciation, Amortization, and Decommissioning

The Utility's Depreciation, amortization, and decommissioning expenses increased by $74 million, or 7%, and $132 million, or 4%, in the three and nine months ended September 30, 2026, compared to the same periods in 2025. These increases were primarily due to the growth in plant balance from capital additions, partially offset by higher deferred depreciation expense for costs awaiting regulatory decisions.

Interest Income

There was no material change in Interest income in the three months ended September 30, 2026, compared to the same period in 2025.

The Utility’s Interest income decreased by $64 million, or 17%, in the nine months ended September 30, 2026, compared to the same period in 2025. This decrease was primarily due to lower dividend income and lower interest-bearing account balances, partially offset by higher interest-bearing self-insurance related balances.

Interest Expense

The Utility’s Interest expense increased by $38 million, or 5%, and $86 million, or 4%, in the three and nine months ended September 30, 2026, compared to the same periods in 2025. These increases were primarily due to the issuance of additional long-term debt and higher borrowings under its revolving credit facility, partially offset by lower balancing account interest.

Other Income, Net

The Utility’s Other Income, Net increased by $19 million, or 20%, and $83 million, or 33%, in the three and nine months ended September 30, 2026, compared to the same periods in 2025. These increases were primarily due to a higher return from the trust assets for the qualified pension plan in the three and nine months ended September 30, 2026, compared to the same periods in 2025.

Income Tax Provision

The Utility’s Income tax provision increased by $117 million, or 58%, in the three months ended September 30, 2026, compared to the same period in 2025. This increase was primarily due to decreased deductions for certain costs attributable to electric generation.

The Utility’s Income tax provision decreased by $5 million, or 5%, in the nine months ended September 30, 2026, compared to the same period in 2025. The income tax provision was comparable to the prior-year period.

The effective tax rates were (11.7)% and (4.2)%, and (28.3)% and (4.7)% for the three and nine months ended September 30, 2026 and 2025, respectively. While the effective tax rate for the nine months ended September 30, 2026 was generally consistent compared to the same period in 2025, the change in the effective tax rate for the three months ended September 30, 2026 compared to the same period in 2025 was primarily due to decreased deductions for certain costs attributable to electric generation. The Utility’s effective tax rate is below the federal statutory rate of 21% for 2026 and 2025, primarily due to the effect of the flow-through ratemaking treatment for certain property-related costs. For these temporary tax differences, the Utility recognizes the deferred tax impact in the current period and records offsetting regulatory assets and liabilities. Therefore, the Utility’s effective tax rate is impacted as these differences arise and reverse. The Utility recognizes 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.