ALJ/SMW/avs Date of Issuance 4/27/2012

Decision 12-04-015 April 19, 2012

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Application of PACIFIC GAS AND ELECTRIC COMPANY to issue, sell, and deliver one or more series of debt securities and to guarantee the obligations of others in respect of the issuance of debt securities, the total aggregate principal amount of such long-term indebtedness and guarantees not to exceed $4.75 billion; to execute and deliver one or more indentures; to sell, lease, assign, mortgage, or otherwise dispose of or encumber utility property; to issue, sell and deliver in one or more series, cumulative Preferred Stock -- $25 Par Value, Preferred Stock - $100 Par Value, Preference Stock or any combination thereof; to utilize various debt enhancement features; enter into interest rate hedges; and for an exemption from the Commission's Competitive Bidding Rule. (U39M)

Application 11-11-001 (Filed November 1, 2011)

DECISION AUTHORIZING PACIFIC GAS AND ELECTRIC COMPANY
TO ISSUE UP TO $4.75 BILLION OF DEBT AND PREFERRED STOCK

TABLE OF CONTENTS

Title Page

DECISION AUTHORIZING PACIFIC GAS AND ELECTRIC COMPANY TO ISSUE UP TO $4.75 BILLION OF DEBT AND PREFERRED STOCK 11

1. Summary 22

2. Background 22

3. Request 44

4. Discussion 88

4.1. Public Utilities Code Requirements for Issuance of Securities 88

4.2. Forecast of Sources and Uses 99

4.3. Types of Securities to be Issued 1010

4.4. Encumbrance of Utility Property 1212

4.5. Securities Enhancements 1515

4.6. Competitive Bidding Rule 1616

4.6.1. Diverse Business Enterprises 1818

4.6.2. Securities for Which Competitive Bidding is Not Applicable 1818

4.6.3. Alternative CBR Procedures 1919

4.6.4. CBR - Conclusion 1919

5. Reporting Requirement 2020

6. Fee 2121

7. Financial Information 2222

8. California Environmental Quality Act (CEQA) 2222

9. Categorization and Need for Hearing 2323

10. Comments on Proposed Decision 2323

11. Assignment of Proceeding 2424

Findings of Fact 2424

Conclusions of Law 2525

ORDER 3131

DECISION AUTHORIZING PACIFIC GAS AND ELECTRIC COMPANY
TO ISSUE UP TO $4.75 BILLION OF DEBT AND PREFERRED STOCK

1. Summary

This decision grants Pacific Gas and Electric Company (PG&E) the authority to issue up to $4.75 billion of new debt securities and new preferred or preference stock. This decision also authorizes PG&E to: 1) encumber accounts receivable and utility property; 2) guarantee the securities or other obligations of PG&E's regulated affiliates and regulated subsidiaries, and governmental entities that issue securities on behalf of PG&E; 3) enter into various enhancement features; 4) receive certain exemptions from the Commission's Competitive Bidding Rule; and 5) report all debt securities information required by General Order 24-B on a quarterly basis. We also grant PG&E's motion to file and maintain as confidential selected information filed in response to a request from the assigned Administrative Law Judge.