NOTE 4: DEBT

Long-Term Debt

The following table summarizes PG&E Corporation’s and the Utility’s long-term debt:

		December 31,
(in millions)		2017		2016
PG&E Corporation
Senior notes:
Maturity	Interest Rates
2019	2.40%	$	350	$	350
Unamortized discount, net of premium and debt issuance costs			-		(2)
Total PG&E Corporation long-term debt			350		348
Utility
Senior notes:
Maturity	Interest Rates
2017	5.63%		-		700
2018	8.25%		400		800
2020	3.50%		800		800
2021	3.25% to 4.25%		550		550
2022	2.45%		400		400
2023 through 2047	2.95% to 6.35%		14,975		12,375
Less: current portion (1)			(400)		(700)
Unamortized discount, net of premium and debt issuance costs			(185)		(161)
Total senior notes, net of current portion			16,540		14,764
Pollution control bonds:
Maturity	Interest Rates
Series 2004 A-D, due 2023(2)	4.75%		-		345
Series 2008 F and 2010 E, due 2026 (3)	1.75%		100		-
Series 2008 G, due 2018 (4)	1.05%		45		-
Series 2009 A-B, due 2026 (5)	1.78%		149		149
Series 1996 C, E, F, 1997 B due 2026 (6)	variable rate(7)		614		614
Less: current portion			(45)		-
Total pollution control bonds			863		1,108
Total Utility long-term debt, net of current portion			17,403		15,872
Total consolidated long-term debt, net of current portion		$	17,753	$	16,220

(1) On January 19, 2018, the Utility sent a notice of redemption to redeem all $400 million aggregate principal amount of the 8.25% senior notes due October 15, 2018 on February 18, 2018. On January 31, 2018, the Utility deposited with the trustee funds sufficient to effect the early redemption of these bonds and satisfy and discharge its remaining obligation of $400 million.

(2) In June 2017, the Utility repurchased and retired $345 million principal amount of Pollution Control Bonds series 2004 A-D.

(3) Pollution Control Bonds series 2008F and 2010E were remarketed and issued in June 2017. Although the stated maturity date for both series is 2026, these bonds have a mandatory redemption date of May 30, 2022.

(4) Pollution Control Bonds series 2008G were remarketed and issued in June 2017 and mature on December 1, 2018.

(5) Each series of these bonds is supported by a separate direct-pay letter of credit. Subject to certain requirements, the Utility may choose not to provide a credit facility without issuer consent.

(6) Each series of these bonds is supported by a separate letter of credit. In December 2015, the letters of credit were extended to December 1, 2020. Although the stated maturity date is 2026, each series will remain outstanding only if the Utility extends or replaces the letter of credit related to the series or otherwise obtains consent from the issuer to the continuation of the series without a credit facility.

(7) At December 31, 2017, the interest rate on these bonds ranged from 1.45% - 1.70%.

Pollution Control Bonds

The California Pollution Control Financing Authority and the California Infrastructure and Economic Development Bank have issued various series of fixed rate and multi-modal tax-exempt pollution control bonds for the benefit of the Utility. Substantially all of the net proceeds of the pollution control bonds were used to finance or refinance pollution control and sewage and solid waste disposal facilities at the Geysers geothermal power plant or at the Utility’s Diablo Canyon nuclear power plant. In 1999, the Utility sold all bond-financed facilities at the non-retired units of the Geysers geothermal power plant to Geysers Power Company, LLC pursuant to purchase and sales agreements stating that Geysers Power Company, LLC will use the bond-financed facilities solely as pollution control facilities for so long as any tax-exempt pollution control bonds issued to finance the Geysers project are outstanding. Except for components that may have been abandoned in place or disposed of as scrap or that are permanently non-operational, the Utility has no knowledge that Geysers Power Company, LLC intends to cease using the bond-financed facilities solely as pollution control facilities.

Repayment Schedule

PG&E Corporation’s and the Utility’s combined long-term debt principal repayment amounts at December 31, 2017 are reflected in the table below:

(in millions,
except interest rates)	2018		2019			2020			2021			2022			Thereafter			Total
PG&E Corporation
Average fixed interest rate		-			2.40%			-			-			-			-			2.40%
Fixed rate obligations	$	-		$	350		$	-		$	-		$	-		$	-		$	350
Utility
Average fixed interest rate		7.52%			-			3.50%			3.80%			2.31%			4.68%			4.61%
Fixed rate obligations	$	445		$	-		$	800		$	550		$	500 (2)		$	14,975		$	17,270
Variable interest rate
as of December 31, 2017		-			1.78%			1.59%			-			-			-			1.63%
Variable rate obligations (1)	$	-		$	149		$	614		$	-		$	-		$	-		$	763
Total consolidated debt	$	445		$	499		$	1,414		$	550		$	500		$	14,975		$	18,383

(1) The bonds due in 2026 are backed by separate letters of credit that expire June 5, 2019, or December 1, 2020.

(2) Pollution Control Bonds series 2008F and 2010E were remarketed and issued in June 2017. Although the stated maturity date for both series is 2026, these bonds have a mandatory redemption date of May 30, 2022.

Short-term Borrowings

The following table summarizes PG&E Corporation’s and the Utility’s outstanding borrowings under their revolving credit facilities and commercial paper programs at December 31, 2017:

		Credit			Letters of			Commercial
	Termination	Facility			Credit			Paper			Facility
(in millions)	Date	Limit			Outstanding			Outstanding			Availability
PG&E Corporation	April 2022	$	300	(1)		$	-		$	132		$	168
Utility	April 2022		3,000	(2)			49			50			2,901
Total revolving credit facilities		$	3,300			$	49		$	182		$	3,069

(1) Includes a $50 million lender commitment to the letter of credit sublimit and a $100 million commitment for swingline loans defined as loans that are made available on a same-day basis and are repayable in full within 7 days.

(2) Includes a $500 million lender commitment to the letter of credit sublimit and a $75 million commitment for swingline loans.

For the year ended December 31, 2017, PG&E Corporation’s average outstanding commercial paper balance was $81 million and the maximum outstanding balance during the year was $161 million. For 2017, the Utility’s average outstanding commercial paper balance was $469 million and the maximum outstanding balance during the year was $1.1 billion. There were no bank borrowings for PG&E Corporation or the Utility in 2017.

Revolving Credit Facilities

In May 2017, PG&E Corporation and the Utility each extended the termination dates of their existing revolving credit facilities by one year from April 27, 2021 to April 27, 2022. PG&E Corporation's and the Utility's revolving credit facilities may be used for working capital, the repayment of commercial paper, and other corporate purposes.

Borrowings under each credit agreement (other than swingline loans) will bear interest based on the borrower’s credit rating and on each borrower’s election of either (1) a London Interbank Offered Rate (“LIBOR”) plus an applicable margin or (2) the base rate plus an applicable margin. The base rate will equal the higher of the following: the administrative agent’s announced base rate, 0.5% above the overnight federal funds rate, and the one-month LIBOR plus an applicable margin. The borrower’s credit rating at the time of borrowing will determine the applicable rate within the following ranges. The applicable margin for LIBOR loans will range between 0.9% and 1.475% under PG&E Corporation’s credit agreement and between 0.8% and 1.275% under the Utility’s credit agreement. The applicable margin for base rate loans will range between 0% and 0.475% under PG&E Corporation’s credit agreement and between 0% and 0.275% under the Utility’s credit agreement. In addition, the facility fee under PG&E Corporation’s and the Utility’s credit agreements will range between 0.1% and 0.275% and between 0.075% and 0.225%, respectively.

PG&E Corporation’s and the Utility’s revolving credit facilities include usual and customary provisions for revolving credit facilities of this type, including those regarding events of default and covenants limiting liens to those permitted under their senior note indentures, mergers, sales of all or substantially all of their assets, and other fundamental changes. In addition, the respective revolving credit facilities require that PG&E Corporation and the Utility maintain a ratio of total consolidated debt to total consolidated capitalization of at most 65% as of the end of each fiscal quarter. PG&E Corporation’s revolving credit facility agreement also requires that PG&E Corporation owns, directly or indirectly, at least 80% of the outstanding common stock and at least 70% of the outstanding voting capital stock of the Utility.

Commercial Paper Programs

The borrowings from PG&E Corporation’s and the Utility’s commercial paper programs are used primarily to fund temporary financing needs. PG&E Corporation and the Utility can issue commercial paper up to the maximum amounts of $300 million and $2.5 billion, respectively. PG&E Corporation and the Utility treat the amount of outstanding commercial paper as a reduction to the amount available under their respective revolving credit facilities. The commercial paper may have maturities up to 365 days and ranks equally with PG&E Corporation’s and the Utility’s other unsubordinated and unsecured indebtedness. Commercial paper notes are sold at an interest rate dictated by the market at the time of issuance. For 2017, the average yield on outstanding PG&E Corporation and Utility commercial paper was 1.29% and 1.11%, respectively.

Other Short-term Borrowings

In February 2017, the Utility’s $250 million floating rate unsecured term loan, issued in March 2016, matured and was repaid. Additionally, in February 2017, the Utility entered into a $250 million floating rate unsecured term loan maturing on February 22, 2018. The proceeds were used for general corporate purposes, including the repayment of a portion of the Utility’s outstanding commercial paper.

In November 2017, the Utility issued $500 million in unsecured floating rate senior notes that mature on November 28, 2018. The proceeds were used towards repayment of the $250 million unsecured floating rate senior notes due November 30, 2017 and the balance was used to support the Northern California wildfire response efforts.