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PG&E Welcomes Release of Independent Evaluation Confirming Accuracy of Utility's SmartMeter™ Meters

Release Date: September 2, 2010
Contact: PG&E External Communications (415) 973-5930

SAN FRANCISCO, Calif. – Pacific Gas and Electric Co. (PG&E) today welcomed the release by the California Public Utilities Commission (CPUC) of an independent, third-party evaluation of the utility's SmartMeter™ program. The report is available at www.pge.com/smartmeter.

The report, prepared by The Structure Group of Houston, Texas, states that PG&E's new meters are recording customer electric usage accurately. It also found that issues that arose early in the program were limited in scope, were being "appropriately addressed by PG&E" and often reflected factors unrelated to the meters, including higher-than-normal energy usage caused by a heat wave.

"We have wholeheartedly supported this third-party verification in order to make sure that our meters are accurate and our program is sound," said PG&E Senior Vice President and Chief Customer Officer Helen Burt. "We want our customers to be armed with the facts, not with speculation. We are pleased that The Structure Group's detailed analysis confirms the integrity of our meter program and provides assurance to customers that our meter readings are accurate. We also agree with its criticism of our failure to address customer concerns on a timely basis, and have taken steps to address that real shortfall in our program."

At the CPUC's direction, Structure independently tested 750 SmartMeter™ devices and 147 legacy electromechanical meters from April to August of this year, both in the laboratory and in the field. The consulting firm also reviewed 1,378 accounts from customers who complained about their bills, and conducted 20 direct phone interviews with customers.

This assessment is the second expert third-party evaluation of advanced metering devices in the United States. The previous assessment, conducted by another consultancy for the Texas Public Utilities Commission, concluded that similar utility smart meters are accurate.

Highlights from the report include:

• Structure said its "evaluation provides the reasonable conclusion that PG&E's SmartMeters™ are accurately recording electric usage within acceptable CPUC tolerances, and are being accurately utilized in customer billing."

• "Identified exceptions related to meter and billing issues appeared to have been limited and did not appear to have been prevalent in the overall deployed Smart Meter population."

• Structure "identified multiple factors that appeared to contribute to the escalation of Smart Meter high bill complaints during late 2009 and early 2010," including the deployment of meters coincident with a heat wave that drove up customer energy usage; individual changes in customer usage, such as room or pool additions; and rate increases that compounded the effects of weather on bills.

• Structure was also critical of PG&E, noting that issues arose because the utility took inadequate steps to notify customers about the meter installations, failed to address their concerns about new technology and lacked stringent bill quality control.

• "Structure found PG&E to have been historically in compliance, or have recently come into compliance, with the majority of best practices associated with Smart Meters."

• "All of the Smart Meters tested in Structure's independent laboratory passed the accuracy testing." Of 613 field tests, two SmartMeter™ meters malfunctioned and all the rest passed accuracy tests. In contrast, of 148 legacy electromechanical meters reviewed, one malfunctioned and six failed the accuracy test.

• Structure also concluded the PG&E's cyber security program meets the objectives set by the main Smart Grid industry task force.

SmartMeter™ devices are part of a statewide energy infrastructure upgrade that is critical to California's economic future. This automated metering technology will help modernize the electric grid to make it stronger and more efficient. It will empower customers to better understand and manage their energy use to reduce monthly costs. The SmartMeter™ program is also essential to enabling growth in renewable energy, laying the foundation for a low-carbon economy.

Since May, PG&E has released reports that are submitted to the CPUC on a monthly basis regarding all aspects of its SmartMeter™ program. The reports, along with weekly updates on the SmartMeter™ program, can be found at {www.pge.com/smartmeter}.

Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest combined natural gas and electric utilities in the United States. Based in San Francisco, with 20,000 employees, the company delivers some of the nation's cleanest energy to 15 million people in Northern and Central California. For more information, visit http://www.pge.com/about/newsroom/.

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