PG&E’s Next Big Move: What Californians Need to Know in 2025

California households served by Pacific Gas & Electric (PG&E) face another round of bill turbulence as the utility tries to balance wildfire liabilities, massive grid hardening projects and an ambitious clean-energy build-out. PG&E’s latest general rate case filing—the blueprint that sets base electricity prices—seeks what executives call the “smallest percentage increase in a decade,” capping the jump at 3.6 percent in 2027 after keeping rates flat in 2026. That might sound modest, but it comes on the heels of a separate settlement that regulators say will already add about $4.90 to the average monthly residential bill this year, largely to cover wildfire-related costs. What’s driving the numbers • Wildfire payouts: The Fire Victim Trust, created after the 2019 bankruptcy, announced it has boosted pro-rata payments to survivors to 66 percent as it closes in on processing nearly 255,000 claims. Funding those payments pressures PG&E’s balance sheet and, ultimately, ratepayers. • Undergrounding 10,000 miles of lines: PG&E told the California Public Utilities Commission (CPUC) the multibillion-dollar “undergrounding” push is the fastest way to curb fire risk and future liabilities, but it is also the largest capital driver in this decade’s rate plan. • Insurance reform: CEO Patti Poppe says pending Sacramento legislation could stabilize wildfire insurance markets and “keep customer costs lower than feared,” allowing PG&E to narrow future rate requests. Short-term bill outlook Despite the settlement increase, PG&E projects that average electric rates should hold steady or dip slightly through the end of 2025 thanks to expiring surcharges and falling natural-gas commodity prices. The bigger question is 2026-27, when new capital spending and the next tranche of wildfire amortization hit customer statements. How customers can blunt the impact 1. Shift to time-of-use: Running major appliances after 9 p.m. can shave 5-15 percent off summer bills, according to PG&E smart-meter data. 2. Electrify with incentives: Federal and state rebates now cover up to $14,000 for heat pumps and induction ranges, devices that also reduce gas charges. 3. Community solar share: More community choice aggregators (CCAs) in PG&E territory let residents buy into off-site solar farms without rooftop installation hurdles. 4. Claim wildfire tax relief: California lawmakers permanently exempted wildfire settlements from state income tax, so victims can keep every recovery dollar for rebuilding. What happens next • CPUC workshops on PG&E’s rate case run through September, with a final decision expected in December. • If lawmakers pass the “Wildfire Reinsurance Expansion Act” this summer, analysts expect PG&E to file a supplemental testimony revising downward its 2027 revenue requirement. • The Fire Victim Trust plans to issue its final round of payments in early 2026; any unspent funds will be redistributed, potentially lowering future surcharges. Bottom line PG&E says it can deliver a safer, cleaner grid while keeping household bills “at or below inflation,” yet every new wildfire cost threatens that promise. With hearings, legislation and payout milestones converging over the next 18 months, customers should track decisions closely and use every efficiency tool available to stay ahead of the next rate spike.