©2011 Pacific Gas and Electric Company. All rights reserved. SmartMeter TM Steering Committee Update – January 2013

2 Steering Committee January 2013 Report Agenda ► Monthly Updates ► Release Status Update ► Deployment Status Update ► Schedule Update ► Deployment Update ► Budget Status – Expenditures by Workstream ► Budget Status – Benefits ► Issues / Risks Summary ► Program Metrics ► Appendix ► Project Deployment Plan Progress ► Contingency Reconciliation ► SmartMeter TM Acronyms

3 Steering Committee January 2013 Report Release Status Update Challenges Actions/Status EACFunded BudgetITDScopeScheduleResourcesIssuesRisks IT Releases: December 31, 2012 Release 1 Release 2 Release 3 Overall ▪ IT has executed against the SmartMeter plan. HAN enablement and Peak Time Rebate roadmaps are in progress. Overall ▪ Development for all in-scope functionality completed as of 3/30/12 ▪ Project stabilization work complete for all components except MV90 and NEMs. ▪ HAN enablement in implementation ▪ Peak Time Rebate roadmap awaiting Commission approval.

4 Steering Committee January 2013 Report Deployment Status Update Actions/Status Challenges EAC2012 Forecast (2012 EOY / CPI) ScopeScheduleResourcesIssuesRisks Deployment: December 31, 2012 Endpoints (2012 YTD) Gas Network (2012 YTD) Electric Network (2012 YTD) Endpoints ▪ Mass deployment is 95% completed. Remaining meter installs continuing in less concentrated geographic areas. ▪ Field Deployment team addressing less common meter types, including NEM and Transformer Rated meter implementation. ▪ Higher than traditional number of ‘Unable-To-Complete’ meters. Electric Network ▪ Initial design scope of electric network is complete. ▪ Assess whether additional electric network is necessary in light of customers opting out of SmartMeter™ Program. Endpoints ▪ Continuing to complete requests for opt-outs in a timely manner. ▪ Plans are being developed to address gaps in Meter Reading routes caused by opt-outs and UTC’s. ▪ Field resources traditionally dedicated to SmartMeter installations are being utilized to support restoration activities on an as-needed basis Electric Network ▪ Tracking the impact of opt-outs on network. ▪ Working with technology supplier and internal stakeholders to address network coverage in ‘hard-to-reach’ areas.

5 Steering Committee January 2013 Report Legend Schedule Update Benefits Field Delivery Approved Milestone (delay)  Meter Reading Reductions (ITD) Forecasted Milestone (delay) Milestone MetBaseline Milestone Forecasted Milestone (early) Milestone TBD IT Release Deployment SM Operations Center Mar JanFeb Jul Jun MayApr Aug Sep All in-scope functionality completed May 2012 Nov Oct Dec 2013  645 Positions Captured   9.1M SmartMeter™ meters/modules w/o retrofits 9.5 SmartMeter™ meters/modules including retrofits 2012 Dec

6 Steering Committee January 2013 Report Deployment Update As of December 31, 2012

7 Steering Committee January 2013 Report 2012 Budget Status – Expenditures by Workstream * Annual budgets revised with intent to complete project in Year-to-Date Variance Explanations: Favorable YTD capital variance ($34.4M) primarily due to fewer meter/module installations (#3), fewer electric meter purchases (#4), and delayed timing of initial HAN roll- out (#5). Favorable YTD expense variance ($4.3M) primarily due to lower spending than planned in Business Operations/PMO (#7), Customer (#10), and IT (#13). ** In December, there was a reclassification of $3.7M from capital to expense for prior field removal and installation costs associated with SSN warrantied meters (#3, #11). A $3M CA sales tax refund was also included in the December budget amount (#3), however it is now anticipated to be received in 2013.

8 Steering Committee January 2013 Report 2012 Budget Status – Benefits

9 Steering Committee January 2013 Report Issues Summary Target Resolution Date IssueImpactStatus Summary Ongoing Installation attempts affected by access refusals and desire for customer choice program. Increased costs, increase in unable to complete (UTC) back-log, customer change management. Communicating with customers about the new SmartMeter Opt-Out Program to facilitate customer elections. Customer Choice Phase 2 resolution is expected in 2013.

10 Steering Committee January 2013 Report Risks Summary #Created OnIPScore Prev. Score RiskImpactStatus Summary Assoc. Issue 19/30/ Increased forecast deployment costs and external resources requirement Key drivers: Delays in deployment, resource availability and installation complexity Increased installation costs and contract resources required to complete remaining installations effectively and timely Pursuing identified opportunities to increase installation efficiency within ongoing operations and adherence to scope. 29/1/ Network deployment and performance in ‘hard-to-reach’ areas can not be completed successfully. Key drivers: Network performance in ‘hard-to-reach’ areas and availability of alternate solutions. Deployment delays, resource planning and increased costs. Pursuing resolution of network coverage in ‘hard-to-reach’ areas with technology supplier, including potential alternate network solutions.

11 Steering Committee January 2013 Report Program Metrics

12 Steering Committee January 2013 Report Project Deployment Plan Progress

13 Steering Committee January 2013 Report Contingency Reconciliation

14 Steering Committee January 2013 Report SmartMeter TM Acronyms