PCGPG&E Corporation

AB 1054 did not specify a period of coverage; therefore, this accounting treatment is subject to significant accounting judgments and estimates. In estimating the period longevity of coverage, the fund, PG&E Corporation and the Utility use a dataset with historical, publicly available fire-loss data caused by electrical equipment to create Monte Carlo simulations of expected loss. The simulation that began with 12 years of historical, publicly available fire-loss data from wildfires caused by electrical equipment, data, and subsequently plan to PG&E Corporation and the Utility add an additional year of data each following subsequent year. The period In addition to historical data, significant assumptions also include the estimated amount of historic Wildfire Fund claim payments, the number of years of fire-loss data data, estimated costs of wildfire settlement claims from other participating utilities, CPUC’s determinations of whether costs were just and reasonable in cases of electric utility-caused wildfires and the effectiveness amounts required to be reimbursed to the Wildfire Fund, and the effects of mitigation efforts by climate change. Due to the California electric utility companies are significant assumptions used judgment required to estimate the useful life. These assumptions along with life of the other assumptions below create Wildfire Fund, there is a high degree of uncertainty related for many of these assumptions, and so subsequent changes to the available information could materially impact the remaining estimated useful life of the Wildfire Fund. The simulation creates annual distributions fund. Based upon the outcome of potential losses due newly run Monte Carlo simulations when known information becomes available, PG&E Corporation and the Utility may determine to fires that could be attributed to increase or decrease, as applicable, the participating electric utilities. Initial use estimated life of five years of historical data, with average annual statewide claims or settlements of approximately $6.5 billion versus 12 years of historical data, with average annual statewide claims or settlements of approximately $2.9 billion, would have the fund. For instance, in 2024, a re-evaluation in the estimate resulted in a six year amortization period. As of December 31, 2024, a 5% change the Wildfire Fund life increasing from 15 to the assumption around current and future mitigation effort effectiveness would increase the amortization period by five years assuming greater effectiveness and would decrease the amortization period by five years assuming less effectiveness. 20 years.

The Utility’s electricity and natural gas systems rely on a complex, interconnected network of generation, transmission, distribution, control, and communication technologies, which can be damaged by natural events such as severe weather or seismic events and by malicious events, such as physical and cyber attacks. Nationally, there has been an increase in physical attacks on substations. Physical attacks targeting the Utility’s physical assets or personnel could cause damage, disrupt operations, or cause injuries. Cyber attacks targeting utility systems are significant and are continuing to increase in sophistication, magnitude, and frequency. Any failure, interruption, or decrease in the functionality of the Utility’s operational networks could cause harm to the public or employees, significantly disrupt operations, negatively impact the Utility’s ability to safely generate, transport, deliver and store energy and gas or otherwise operate in a safe and efficient manner or at all, and damage the Utility’s assets or operations or those of third parties. parties, increase costs, and impact the Utility’s ability to track or collect revenues and to maintain effective internal controls over financial reporting. Such events could subject the Utility to significant expenses, claims by customers or third parties, government inquiries, penalties for violation of applicable privacy laws, investigations, lawsuits, and regulatory actions and could result in material fines, penalties, loss of customers, and harm to PG&E Corporation’s and the Utility’s reputation, any of which could have a material effect on PG&E Corporation’s and the Utility’s business strategy, financial condition, or results of operations.

In November 2024, September 2025, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, 2025-07, Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606), which amends amended the existing guidance to require disclosure, (a) reduce the cost and complexity of evaluating whether contracts with features based on the operations or activities of one of the parties to the contract are derivatives, (b) better portray the economics of those contracts in the notes to the financial statements, and (c) reduce diversity in practice resulting from the broad application of specified information about certain costs the current guidance and expenses. This ASU will become effective changing business environment. The amendments also are expected to reduce diversity in practice by clarifying the applicability of Topic 606, Revenue from Contracts with Customers, to share-based noncash consideration from a customer for the transfer of goods or services. PG&E Corporation and the Utility for fiscal years beginning after early adopted the ASU as of December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early 31, 2025. The adoption permitted. of this ASU did not have a significant impact on PG&E Corporation and the Utility are currently evaluating the impact the guidance will have on their Utility’s Consolidated Financial Statements and related disclosures.

Each SEC rules require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and such proceedings involve potential monetary sanctions that the company reasonably believes will exceed a specified threshold. Consistent with SEC rules, each of PG&E Corporation and the Utility has elected to use $1 million as the quantitative threshold for disclosure of environmental proceedings described in Item 103(c)(3)(iii) of Regulation S-K. such proceedings.