Where Could PG&E’s Next Growth Come From

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PG&E (PCG) stock lost 20.1% in the year to October 26, 2026, trailing a 15.3% return for the S&P 500. On its October 22 call, management reaffirmed a forecast for core earnings per share to rise 9% at the midpoint in 2027. A plan PG&E filed at the end of September could add a lot more investment beyond 2027. So what did PG&E file, and how far along is that work?

PG&E Wants To Bury Far More Power Lines

At the end of September, PG&E filed a 10-year electric undergrounding plan proposing to move 5,000 more miles of power lines underground between 2028 and 2037. The company expects to finish about 1,900 miles by the end of 2027, making the new plan a far larger version of work already under way.

The filing follows years of progress on fire safety. On the October 22 call, management said its weather-normalized ignition rate, a measure of how often fires start on the system, has fallen 74% since 2017. That marks the lowest level since the company began tracking the metric. The undergrounding plan itself remains a proposal, not an approved program.

How Big Is The Plan Next To PG&E's Value?

The plan contemplates a $16.6 billion investment over ten years. That is more than half of PG&E's market value of $28.3 billion at the October 26 close. Spread over ten years, the yearly average equals about 15% of PG&E's 2027 capital plan. That matters for shareholders: on the October 22 call, management said customer capital investment continues to be the primary driver of the company's earnings growth.

On October 26, PG&E closed 32.1% below its highest close of the past 365 days. The stock trades at 9.2 times its earnings over the past twelve months, compared with 22.9 for the S&P 500.

What Has To Go Right For PG&E's Plan?

The method used to judge the plan is a concern for management. On the October 22 call, management said it is concerned that a benefit-cost test in a recent CPUC proposed decision would prevent undergrounding from reaching thousands of customers in high-risk communities. Asked on the same call how many miles this method would affect, management said the company was still working through that number.

Money is the other hurdle. Citing high financing costs, the company reduced its 2027 capital plan by $2 billion and has begun notifying customers whose projects may be delayed. Total debt equals 231.4% of its market value, compared with 19.4% for the S&P 500. Management said it would not issue shares at the current stock price, and that it has already addressed its expected equity needs through 2030.

PG&E has also stopped giving guidance beyond 2027 during a strategic review, and management expects to share the outcome no later than next summer. The company is expected to report its next results in February 2027. Its 2027 capital plan, now $11.4 billion, is the figure to watch in that report.

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