PG&E 2010 Annual Report Download - page 30

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Financing Activities
The Utility’s cash flows from financing activities for 2010,
2009, and 2008 were as follows:
(in millions) 2010 2009 2008
Borrowings under revolving credit
facilities $ 400 $ 300 $ 533
Repayments under revolving credit
facilities (400) (300) (783)
Net issuances of commercial paper,
net of discount of $3 in 2010 and
2009, and $11 in 2008 267 43 6
Proceeds from issuance of short-term
debt, net of issuance costs of $1 in
2010 and 2009 249 499 –
Proceeds from issuance of long-term
debt, net of premium, discount,
and issuance costs of $23 in 2010,
$25 in 2009, and $19 in 2008 1,327 1,384 2,185
Short-term debt matured (500) ––
Long-term debt matured or
repurchased (95) (909) (454)
Energy recovery bonds matured (386) (370) (354)
Preferred stock dividends paid (14) (14) (14)
Common stock dividends paid (716) (624) (568)
Equity contribution 190 718 270
Other (73) (5) (36)
Net cash provided by financing
activities $ 249 $ 722 $ 785
In 2010, net cash provided by financing activities
decreased by $473 million compared to 2009. In 2009, net
cash provided by financing activities decreased by $63
million compared to 2008. Cash provided by or used in
financing activities is driven by the Utility’s financing
needs, which depend on the level of cash provided by or
used in operating activities and the level of cash provided
by or used in investing activities. The Utility generally
utilizes long-term senior unsecured debt issuances and
equity contributions from PG&E Corporation to fund debt
maturities and capital expenditures and to maintain its
CPUC-authorized capital structure, and relies on short-
term debt to fund temporary financing needs.
PG&E CORPORATION
As of December 31, 2010, PG&E Corporation’s affiliates
had entered into four tax equity agreements with two
privately held companies to fund residential and
commercial retail solar energy installations. Under these
agreements, PG&E Corporation will provide payments of
up to $300 million, and in return, receive the benefits of
local rebates, federal investment tax credits or grants, and a
share of these companies’ customer payments. PG&E
Corporation could be required to pay up to an additional
$41 million in the event that its ownership interests are
liquidated when in a deficit position. (See Note 2 of the
Notes to the Consolidated Financial Statements.) However,
PG&E Corporation’s financial exposure for these
arrangements is generally limited to its lease payments and
investment contributions to these companies. As of
December 31, 2010, PG&E Corporation had made total
payments of $149 million under these tax equity
agreements. Lease payments and investment contributions
are included in cash flows from operating and investing
activities, respectively, within the Consolidated Statements
of Cash Flows.
In addition to the investments above, PG&E
Corporation had the following material cash flows on a
stand-alone basis for the years ended December 31, 2010,
2009, and 2008: dividend payments, interest payments,
common stock issuance, the senior note issuance of $350
million in March 2009, net tax refunds of $189 million in
2009, and transactions between PG&E Corporation and the
Utility.
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