OAKLAND — PG&E handed out higher executive compensation to the utility giant’s top boss and other key executives in 2023 — pay increases that came at a time of soaring monthly customer bills and rising profits.
CEO Patricia Poppe received slightly less than $17 million — $16.99 million, to be precise — in total direct compensation for the company’s 2023 fiscal year that ended in December, according to a new regulatory filing with the Securities and Exchange Commission. The compensation boost was about 20.3% higher than her executive pay for the previous year when she received about $14.1 million.
The pay and benefits package angered frustrated customers and advocates pushing the utility to change the way it operates.
“Customers, shocked by record-breaking bills, have a right to be upset that PG&E shareholders are showering their CEO with $17 million a year,” said Mark Toney, executive director with The Utility Reform Network, or TURN.
This January, PG&E monthly bills reached $294.50 a month on average for the typical residential customer who receives combined electricity and gas services from the Oakland-based utility. That was 22.3% higher than the average monthly charges that went into effect a year ago.
PG&E defended the hefty compensation. “Our executives’ compensation was tied to delivering the improvements in safety, operational and financial performance that PG&E achieved in 2023,” spokesman Mike Gazda said.
An average of about 74% of a PG&E executive’s compensation is tied to performance, according to the company. Of the 11 named company executives listed in the regulatory report, five received an increase in total direct compensation while six received decreases, a review by this news organization of PG&E’s annual filing with the SEC shows.
Separately from her 2023 total compensation, Poppe received a gain of $24.4 million through the vesting of an award of restricted stock, the SEC filing shows.
In 2023, PG&E’s profits soared higher, buoyed by surging electricity and natural gas revenues.
The power company earned an eye-popping $2.24 billion in profits in 2023, an increase of 24.6% from 2022, PG&E reported in February.
PG&E also predicted that its shareholders, a combination of big investment firms, major mutual funds and large Wall Street players, can anticipate that 2024 will produce even greater profits.
“Less than 1% of the reported 2023 profits were paid to shareholders,” PG&E stated in an email sent to this news organization. “More than 99% are being re-invested back into our energy system to improve how we serve customers and support our return to financial health.”
The utility’s customers don’t pay for the company’s executive compensation. Shareholders foot that bill, according to PG&E.
“PG&E executive compensation complies with California Public Utilities Commission and other regulatory requirements and has been approved by California’s Office of Energy Infrastructure Safety,” the company stated.
PG&E monthly bills have zoomed higher in recent years, and part of PG&E’s rationale for requesting permission from state regulators to raise rates repeatedly is that the company requires more revenue to bankroll improvements to equipment to prevent the types of catastrophic wildfires the company has caused in the past.
PG&E has been ordered to pay billions of dollars in penalties for its role in causing a deadly gas explosion in 2010 in San Bruno and a series of devastating wildfires in Northern California, including the deadly Camp Fire in 2018 that claimed more than 80 lives and decimated the town of Paradise.
In 2020, PG&E pleaded guilty to 84 counts of involuntary manslaughter in connection with the lethal Camp Fire in Butte County.
The company’s history makes the newly revealed compensation for executives frustrating for customers.
“If they have enough to provide their executives with millions of dollars in raises because of record-breaking profits,” Toney said, “then they can provide rate relief to millions of captive customers who can no longer afford to pay their monthly utility bills.”