SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2021

Summary of Revenues Disaggregated by Type of Customer

The following table presents the Utility’s revenues disaggregated by type of customer:


	Year Ended
(in millions)	2021		2020
Electric
Revenue from contracts with customers
Residential	$	6,089	$	5,523
Commercial	5,042		4,722
Industrial	1,493		1,530
Agricultural	1,565		1,471
Public street and highway lighting	73		69
Other (1)	(84)		(130)
Total revenue from contracts with customers - electric	14,178		13,185
Regulatory balancing accounts (2)	953		673
Total electric operating revenue	$	15,131	$	13,858

Natural gas
Revenue from contracts with customers
Residential	$	2,759	$	2,517
Commercial	713		597
Transportation service only	1,346		1,211
Other (1)	140		61
Total revenue from contracts with customers - gas	4,958		4,386
Regulatory balancing accounts (2)	553		225
Total natural gas operating revenue	5,511		4,611
Total operating revenues	$	20,642	$	18,469

(1) This activity is primarily related to the change in unbilled revenue and amounts subject to refund, partially offset by other miscellaneous revenue items.

(2) These amounts represent revenues authorized to be billed or refunded to customers.

Schedule of Estimated Useful Lives and Balances of Utility's Property, Plant and Equipment

The Utility’s estimated service lives of its property, plant, and equipment were as follows:


	Estimated Service	Balance at December 31,
(in millions, except estimated service lives)	Lives (years)	2021		2020
Electricity generating facilities (1)	5 to 75	$	11,217	$	12,505
Electricity distribution facilities	10 to 70	37,723		34,902
Electricity transmission facilities	15 to 75	15,516		14,414
Natural gas distribution facilities	20 to 60	14,100		12,962
Natural gas transmission and storage facilities	5 to 66	9,067		8,293
Financing lease		18		18
Construction work in progress		3,480		2,757
General plant and other	5 to 50	7,838		8,041
Total property, plant, and equipment		98,959		93,892
Accumulated depreciation		(29,131)		(27,756)
Net property, plant, and equipment (2)		$	69,828	$	66,136

(1) Balance includes nuclear fuel inventories. Stored nuclear fuel inventory is stated at weighted-average cost. Nuclear fuel in the reactor is expensed as it is used based on the amount of energy output. See Note 15 below.

(2) Includes $850 million of fire risk mitigation-related property, plant, and equipment securitized in accordance with AB 1054. See Note 5 below.

Schedule of Changes in Asset Retirement Obligations

The following table summarizes the changes in ARO liability during 2021 and 2020, including nuclear decommissioning obligations:


(in millions)	2021		2020
ARO liability at beginning of year	$	6,412	$	5,854
Liabilities incurred in the current period	—		268
Revision in estimated cash flows	(1,378)		53
Accretion	287		265
Liabilities settled	(23)		(28)
ARO liability at end of year	$	5,298	$	6,412

Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income

The changes, net of income tax, in PG&E Corporation’s accumulated other comprehensive income (loss) for the year ended December 31, 2021 consisted of the following:


(in millions, net of income tax)	Pension Benefits		Other Benefits		Total
Beginning balance	$	(39)	$	17	$	(22)
Other comprehensive income before reclassifications:
Unrecognized net actuarial gain (net of taxes of $391 and $53, respectively)	1,007		137		1,144
Regulatory account transfer (net of taxes of $390 and $53, respectively)	(1,003)		(136)		(1,139)
Amounts reclassified from other comprehensive income:
Amortization of prior service cost (net of taxes of $2 and $4, respectively) (1)	(4)		10		6
Amortization of net actuarial (gain) loss (net of taxes of $2 and $9, respectively) (1)	4		(24)		(20)
Regulatory account transfer (net of taxes of $1 and $5, respectively) (1)	2		14		16
Net current period other comprehensive income	6		1		7
Ending balance	$	(33)	$	18	$	(15)

(1) These components are included in the computation of net periodic pension and other postretirement benefit costs. See Note 12 below for additional details.

The changes, net of income tax, in PG&E Corporation’s accumulated other comprehensive income (loss) for the year ended December 31, 2020 consisted of the following:


(in millions, net of income tax)	Pension Benefits		Other Benefits		Total
Beginning balance	$	(22)	$	17	$	(5)
Other comprehensive income before reclassifications:
Unrecognized net actuarial gain (loss) (net of taxes of $162 and $66, respectively)	(417)		170		(247)
Regulatory account transfer (net of taxes of $155 and $66, respectively)	400		(170)		230
Amounts reclassified from other comprehensive income:
Amortization of prior service cost (net of taxes of $2 and $4, respectively) (1)	(4)		10		6
Amortization of net actuarial (gain) loss (net of taxes of $1 and $6, respectively)(1)	2		(15)		(13)
Regulatory account transfer (net of taxes of $1 and $2, respectively) (1)	2		5		7
Net current period other comprehensive loss	(17)		—		(17)
Ending balance	$	(39)	$	17	$	(22)

(1) These components are included in the computation of net periodic pension and other postretirement benefit costs. See Note 12 below for additional details.

Schedule of Lease Expense

The following table shows the lease expense recognized for the fixed and variable component of the Utility’s lease obligations:


	Year Ended December 31,
(in millions)	2021		2020
Operating lease fixed cost	$	578	$	679
Operating lease variable cost	1,782		1,852
Total operating lease costs	$	2,360	$	2,531

Schedule of Future Expected Operating Lease Payments

At December 31, 2021, the Utility’s future expected operating lease payments were as follows:


(in millions)	December 31, 2021
2022	$	533
2023	276
2024	118
2025	111
2026	105
Thereafter	444
Total lease payments	1,587
Less imputed interest	(310)
Total	$	1,277