- Company name
- PG&E
- Sector
- Regulated electric & gas utility
- About
- PG&E owns Pacific Gas and Electric Company. This is the monopoly electric and gas utility for northern and central California. It delivers power and natural gas to about 16 million people. PG&E earns a regulated return on the money it spends on poles, wires, pipelines, and power plants. State regulators set this return through rate cases.
- Thesis
- PG&E's stock trades at a low multiple compared to other regulated utilities. The reason is wildfire liability. The 2019 bankruptcy taught investors that one bad fire season can wipe out years of profit. In August 2026, California lawmakers failed to pass a bill that would have limited this liability, and the stock fell sharply. But PG&E has cut ignitions from its own equipment by more than 70% on circuits with new safety settings, and it has now buried over 1,000 miles of power lines in high fire-risk areas. If lawmakers revisit liability reform, or if PG&E gets through more fire seasons without a major equipment-caused fire, the market may lower the risk premium it assigns to the stock.
- Risks
- PG&E still faces open-ended wildfire liability. Lawmakers failed to pass a bill in 2026 that would have capped this liability, so a large future fire caused by PG&E equipment could again threaten its balance sheet, as it did in 2019.
PG&E faces about 190 lawsuits, with more than 9,000 plaintiffs, over the 2021 Dixie Fire. A trial for one plaintiff is scheduled for December 2026, and the result could set a costly precedent for the remaining claims.
PG&E's multi-year capital plan depends on a favorable outcome on wildfire liability reform. After the 2026 reform effort failed, PG&E already deferred billions of dollars of work, including new data center connections that are central to its growth plan.
- Recent events
- 2026-08-31: California lawmakers ended their legislative session without passing a wildfire liability reform bill. PG&E stock fell about 20% in one trading day, its worst single-day drop since March 2020.
2026-07-23: PG&E reported Q2 2026 results. Core earnings per share were $0.40, above what analysts expected. The company reaffirmed full-year 2026 guidance.