PG&E 2010 Annual Report Download - page 5

A LETTER TO OUR STAKEHOLDERS FROM CHAIRMAN, CEO, AND
PRESIDENT PETER A. DARBEE
Last year will long be remembered as one of the most
difficult in our company’s history, as we confronted and
worked to overcome formidable challenges. Above all was
the September 9 explosion on our natural gas pipeline in
San Bruno, California, which tragically claimed eight
lives, injured many more, destroyed or damaged dozens
of homes, and shook many people’s confidence in PG&E.
There are no words sufficient to fully convey my
personal sadness at this tragedy. As we move forward to
implement lessons learned from this accident and become
a stronger and safer company, I know I can speak for
everyone at PG&E when I say that the people whose lives
have been impacted continue to be in all our thoughts
and prayers.
This accident and other challenges in 2010 have made
it clear that we have a long journey ahead to become the
industry leader we aspire to be, and our team and I are
more determined than ever to do what it takes to reach
that goal.
Our pledge is that PG&E will ultimately emerge from
this experience not simply as a better company, but rather
as a standard-bearer for excellence among utilities. Indeed,
we take seriously our responsibility to see that the lessons
from this event not only help PG&E reach a new level of
performance, but also help others in our industry to do
the same.
Most of all, our resolve is focused on raising the
standards for the way PG&E manages and operates its
natural gas infrastructure. We are also committed to
cultivating stronger relationships with our customers—
beginning with restoring their trust in the safety and
integrity of our system and operating practices.
As we pursue these goals, we are cooperating with our
regulators, policy makers, and other stakeholders. As
always, though, our success will also depend on the
efforts of our 20,000 men and women. Their spirit of
service has been the soul of PG&E for more than 100
years, and it has sustained us through the ups and downs
that any long-lived company inevitably experiences.
Even amid last year’s challenges, PG&E employees
accomplished important goals on behalf of our
customers. They re-inspected thousands of miles of
natural gas lines in the wake of the San Bruno accident.
They restored power following outages more quickly than
any time in a decade and reduced the frequency of
outages to the lowest level in more than two decades.
They safely and efficiently brought two new power plants
into operation. They achieved ambitious sustainability
targets for reducing our energy and water use. And they
helped our customers realize significant savings through
further gains in energy efficiency.
But perhaps most telling, they came forward in
overwhelming numbers to help victims of the San Bruno
accident, providing PG&E with a strong presence in the
community and putting a human face on our
commitment to help residents recover and rebuild.
However, without diminishing the importance of these
and other individual accomplishments, let it be said
clearly that no one on our leadership team was satisfied
with the sum of PG&E’s performance in 2010.
The challenges encountered last year raised concerns
among our customers, put strains on relationships, and,
in some cases, hurt our standing in the eyes of valued
stakeholders. Our team is working aggressively to reverse
these setbacks and learn from these events.
Importantly, PG&E’s longer-term performance results
remain solid. In recent years we have made meaningful
strides in areas from reliability and workplace safety to
energy efficiency and environmental leadership. And,
despite the impact of the challenges in 2010, we have
delivered competitive returns for shareholders over the
past several years.
This letter presents an overview of last year’s
accomplishments and challenges, together with insights
into our plans for the current year and beyond as we work
to regain our momentum and deliver the level of
performance our stakeholders have rightly come to
expect.
MAINTAINING SOLID FINANCIAL
PERFORMANCE
As we do every year, in 2010 we again strove to see that
PG&E continues to represent a solid investment
opportunity. We recognize that only by consistently
delivering on this requirement can we also see to it that
PG&E is able to access new capital on the best terms for
our customers and fund the substantial investments
necessary to provide service on their behalf.
Once again last year, new capital investments in
PG&E’s utility asset base, together with incentives earned
by helping customers realize significant energy efficiency
savings goals, helped to drive growth in core earnings.
However, the financial impacts of the San Bruno accident
had an adverse effect on the company’s earnings as
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