PG&E Secures $15 Billion Loan From U.S. Energy Department

The Energy Department plans to offer a record $15 billion loan guarantee to Pacific Gas & Electric, California’s largest utility, to improve its electrical grid and fund climate resiliency projects, the department said on Tuesday.

The loan guarantee is the biggest commitment to date from the department’s Loan Programs Office, which has doled out tens of billions of dollars in loans and guarantees under the Biden administration to fund energy and electric vehicle projects. The conditional commitment, which still has to be finalized, will help PG&E invest in hydroelectric power generation, batteries and power lines.

PG&E, one of the largest utilities in the country serving roughly 16 million people in Northern and Central California, is grappling with a surge of demand for electricity spurred by the shift to electric vehicles, the expansion of data centers and efforts to phase out fossil fuels. The company is also under pressure to prevent its equipment from setting off devastating fires.

“These infrastructure investments will help PG&E meet forecasted load growth, increase electric reliability and reduce costs for its consumers across California,” the Energy Department said in a statement.

State regulators have also put pressure on PG&E to limit rate increases for California residents, though officials have approved multiple rate increases this year.

This month, the Public Advocates Office, which represents consumers in utility rate cases before the California Public Utilities Commission, issued a report citing PG&E’s rate increases as the highest among the state’s investor-owned utilities.