SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: July 20, 1995
PACIFIC GAS AND ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
California 1-2348 94-0742640
(State or other juris- (Commission (IRS Employer
diction of incorporation) File Number) Identification Number)
77 Beale Street, P.O.Box 770000, San Francisco, California 94177
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(415) 973-700
Item 5. Other Events
A. Performance Incentive Plan - Year-to-Date Financial Results
The Performance Incentive Plan (Plan) is an annual incentive
compensation plan applicable to all regular, nonbargaining unit
employees of the Company and designated subsidiaries. The Plan
provides for awards based on (1) the Company's success in meeting
overall corporate financial performance objectives, based on combined
earnings per share for the Company's utility operations, Diablo
Canyon nuclear power plant (Diablo Canyon) operations and the
Company's nonregulated operations conducted through PG&E Enterprises
(Enterprises), a wholly owned subsidiary; and (2) the performance of
the employee's organizational unit in meeting its individual
objectives. The corporate and organizational objectives include cost
control, quality and reliability of service to customers, financial
performance and operational efficiency.
Under the Plan, the Nominating and Compensation Committee of the
Board (Committee) makes the final determination of officer awards
based upon achievement of the Plan objectives. The Committee has the
discretion to modify or eliminate officer awards. The final
determination of non-officer awards is made by the chief executive
officer, who also has the discretion to modify or eliminate non-
officer awards.
The performance measurement target for the 1995 Plan year was
disclosed in a Report on Form 8-K dated January 4, 1995, and was
based upon the corporate capital and operating budgets prepared for
1995.
The 1995 budgeted earnings per share for the utility were derived
from, among other things, (i) budgeted revenues as authorized by the
California Public Utilities Commission (CPUC) for 1995 which include
the continuation of the Company's economic stimulus rate and electric
rate freeze, (ii) the Company's capital budget for 1995 of
approximately $1.3 billion for utility operations and (iii) budgeted
operating expenses for utility operations that are approximately 9%
less than budgeted for 1994. The budgeted operating expenses for
utility operations assume Customer Energy Efficiency (CEE) and
electric research development and demonstration (RD&D) expenditures
that are $150 million less than previously authorized for 1995,
consistent with the CPUC decisions issued in December 1994 granting
the Company's request for reduced CEE and RD&D expenditures in 1995.
The utility budgeted earnings per share assumes contribution to
earnings of $.10 per share from Pacific Gas Transmission Company.
The budgeted earnings per share for Diablo Canyon were derived from,
among other things, (i) a reduction in the price of power produced by
Diablo Canyon from 11.89 cents per kilowatt-hour (Kwh) in 1994 to
11.0 cents per Kwh in 1995, consistent with the agreement to modify
the Diablo Canyon rate case settlement, which was approved by the
CPUC in May 1995, (ii) an operating capacity factor (excluding
refueling outages) of 91%, (iii) an overall annual capacity factor of
85.4% and (iv) one 45-day refueling outage at Unit 1 during 1995.
Budgeted operating expenses for 1995 relating to Diablo Canyon are
approximately 20% less than budgeted for 1994. Budgeted capital
expenditures for Diablo Canyon are approximately $47 million for
1995, which is 55% less than budgeted for 1994.
The budgeted earnings per share for Enterprises assumes net income of
$9 million from U.S. Generating Company and PG&E Properties, which is
offset by budgeted net losses of $19 million attributable primarily
to DALEN Resources Corp. (DALEN) and two new business areas,
international power generation and new products and services in U.S.
utility markets. As noted in footnote (4) below, in June 1995
Enterprises completed the sale to a third party of all of the capital
stock of DALEN.
All of the budgeted earnings per share amounts assume 430 million
shares of common stock outstanding. The budgeted earnings per share
amounts assume no significant gain or loss on the sale of assets.
On a quarterly basis, the Company discloses the year-to-date
financial performance of the Company relating to the three types
of operations: utility, Diablo Canyon and Enterprises. For
the six months ended June 30, 1995, selected financial
information is shown below:
<TABLE>
<CAPTION>
(in thousands of dollars, except per share amounts)
Six Months Ended June 30, 1995
=================================================================
Actual <F1> Budget <F2>
(unaudited)
<S> <C> <C>
Operating Revenues:
Utility $ 3,631,677 $ 3,970,976
Diablo Canyon 1,008,614 <F3> 933,405
PG&E Enterprises 114,790 148,430
----------- ----------
Total Consolidated $ 4,755,081 $ 5,052,811
=========== ==========
Net Income (Loss):
Utility $ 404,986 $ 395,826
Diablo Canyon 322,242 <3> 271,929
PG&E Enterprises 6,979 <4> (4,172)
----------- ----------
Total Consolidated $ 734,207 $ 663,583
=========== ==========
Earnings (Loss) Per
Common Share:
Utility $ 0.89 $ 0.86
Diablo Canyon 0.74 <F3> 0.62
PG&E Enterprises 0.02 <F4> (0.01)
----------- ----------
Total Consolidated $ 1.65 $ 1.47
=========== ==========
<FN>
<FN1>
(1) In the opinion of management, the unaudited "actual" financial
information presented above reflects all adjustments to date which
are necessary to present a fair statement of operating revenues, net
income and earnings per common share for the interim period. All
material adjustments are of a normal recurring nature, except as
noted below. This information should be read in conjunction with the
1994 Consolidated Financial Statements and Notes to Consolidated
Financial Statements incorporated by reference in the Company's
Annual Report on Form 10-K, and the Consolidated Financial Statements
and Notes to Consolidated Financial Statements in the Quarterly
Report on Form 10-Q for the quarter ended March 31, 1995.
<FN2>
(2) The budgeted corporate earnings per share is a performance
target and is not a forecast of actual performance that will be
realized by the Company. The budgeted amount does not reflect the
resolution of various regulatory uncertainties or other
contingencies, including those disclosed in the Notes to the
Company's Consolidated Financial Statements, which could affect the
Company's performance during the year. Actual performance during the
year may differ materially from the budgeted amount.
<FN3>
(3) Diablo Canyon operated at an overall capacity factor of
98.2% compared to a budgeted overall capacity factor of 91.0% for
the six months ended June 30, 1995.
<FN4>
(4) In June 1995, Enterprises completed the sale of DALEN, resulting
in a gain of $.03 per share in the six-month period ended June 30,
1995.
</FN>
</TABLE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
PACIFIC GAS AND ELECTRIC COMPANY
LESLIE H. EVERETT
By ________________________________
LESLIE H. EVERETT
Corporate Secretary
Dated: July 20, 1995
