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Corporate Philanthropy

By being active members of our communities and supporting organizations and initiatives that create neighborhoods with robust businesses, plentiful jobs, vibrant schools, great parks and a healthy citizenry, we are contributing to a more sustainable society. We give money, time, advice—and technology—to make a difference and improve the quality of life.

In 2006, PG&E increased its shareholder-funded charitable contributions to nearly $14.7 million from approximately $12 million in 2005, achieving our goal of contributing 1 percent of pre-tax earnings from operations. And we did it in a way that was responsive to the needs of both the communities and constituencies we serve and provides support for a better environment and more sustainable future. PG&E provided cash grants, in-kind contributions, and other forms of support to nonprofit organizations and government agencies throughout northern and central California; we also contributed to statewide and national organizations. To do this, we worked with communities and local organizations to identify community needs and develop programs that delivered targeted contributions. In 2007, PG&E plans to make charitable contributions of $18.3 million or 1.2 percent of pre-tax earnings.

In 2006, we targeted five broad areas for charitable giving: education, environment and energy, emergency preparedness, economic development, and civic and community. The chart above provides an overview of the percentage of contributions in each area in 2006.

Within these categories, we directed a significant portion of the contributions to support organizations working in underserved communities. For example, in 2006, approximately 71 percent of our corporate contributions went to organizations supporting low-income communities, people of color, senior citizens, the disabled, the homeless, the working poor and unemployed and the GLBT community. This is an increase of 6 percentage points from 2005. In addition, 21 percent of our corporate contributions went to organizations with minority leadership, up from 17 percent in 2005. Going forward, we intend to increase the contributions directed toward assisting the most vulnerable members of our communities.

Examples of PG&E's 2006 contributions include:

Helping California's Schools Use Technology to Reduce Their Environmental
Impact and Save Money.
California's schools face unprecedented challenges—
including increasing operating costs, reduced funding and pressures to improve

Students at Evergreen 6th Grade Academy in Paradise, Calif., celebrate their participation in PG&E's Solar Schools program.

the overall educational environment for students. Recognizing this challenge, we
launched the Solar Schools Program in 2004; this is a shareholder-funded initiative
that reinforces PG&E's commitment to renewable energy, education and the need to address climate change in a way that benefits underserved schools, students and the community at large.

The largest program of its kind, Solar Schools provides participating schools throughout northern and central California with a free 1.3-kW solar energy installation and supporting educational materials that help each participating school meet the California Department of Education's standards for science, social studies, math and English. In 2006, we facilitated the installation of solar arrays in 30 schools, trained more than 600 teachers in a solar sciences curriculum, and made grants of $225,000 in support of these efforts. As a result, more than 77,000 students will gain first-hand knowledge of the potential of solar energy and, hopefully, be inspired to pursue educational opportunities in science. In recognition of the success of this program, in 2006, PG&E received the prestigious California Governor's Environmental and Economic Leadership Award.

Contributing Our Expertise and Deploying Advanced Technologies to Help Make Energy More Affordable. PG&E's Solar Habitat Program, a partnership between PG&E and Habitat for Humanity, is helping to reduce energy bills for low-income homeowners and making a real contribution to improving air quality and mitigating climate change. Through this program, PG&E is providing expertise, volunteers, and charitable grants to help build energy-efficient homes and install roof-top solar-powered systems. This means that these homeowners need to buy less power to meet their basic energy needs, which saves them money and protects the environment.

In 2006, PG&E supported solar installations on 51 homes throughout our service area. These solar panels will each generate nearly 300 kWh of clean, renewable energy from sunlight each month, saving the families approximately $500 a year; each panel will also help avoid the release of more than 132,000 pounds of carbon dioxide (CO2) to the atmosphere over the 30-year life of the system. In 2007, this program will be expanded to at least 18 Habitat for Humanity chapters in our service area in northern and central California.

PG&E Helps Establish Northern California as a Leader in
Energy Efficiency Research and Technology

Ensuring Our Customers and Communities Are Prepared for Disasters. As an outgrowth of the commemoration of the 1906 San Francisco earthquake, PG&E partnered with the U.S. Geological Survey (USGS), New American Media, the Asian Pacific Fund, and the California Earthquake Authority to translate and distribute culturally appropriate non-English versions of the USGS document "Putting Down Roots in Earthquake Country"—a primer on how to prepare your family and your home for the next big Bay Area earthquake. In addition, PG&E is hosting a series of town hall meetings with our partners to provide enhanced emergency preparedness information for community-based organizations whose clients are primarily from underserved populations. PG&E is also hosting and contributing its expertise to a series of training sessions for ethnic media outlets so that they are better informed about both how to prepare for an earthquake and how to communicate to their audiences after one strikes.

This effort is an extension of our three-year commitment of over $1 million to Red Cross Chapters in Northern California to support their preparedness activities for vulnerable populations.

Supporting Our Communities So They Can Build for the Future. For the fifth consecutive year, PG&E sponsored its Local Economic Development (LED) grants program, which distributed almost $400,000 in grants to 62 community-based and governmental organizations to assist in their efforts to build more economically viable communities. These grants were used for a variety of economic and community development initiatives, including business retention, business recruitment, infrastructure planning, downtown improvement, training, web sites, marketing materials and green business development. Over the past five years of this program, PG&E has provided more than $1.3 million to 248 LED projects.
Partnering to Educate Tomorrow's Leaders about the Importance of a Healthy Environment. In partnership with the National Fish and Wildlife Foundation (NFWF), PG&E formed the Nature Restoration Trust (NRT) in 1999 to provide grants to community-based organizations and schools for high school environmental education projects. As part of the program, students from participating schools perform hands-on habitat restoration around their communities. In 2006, PG&E and NFWF held the first NRT Conference, which brought together grantees for a series of seminars, panel discussions and "best practices" discussions. California Secretary for Resources Mike Chrisman opened the conference and reinforced that hands-on environmental education at the K-12 level is critical to ensuring a healthy environment for the future.
Partnering with Our Employees to Provide Educational Opportunities for Underserved Youth. PG&E partners with its seven Employee Associations to provide opportunities to underserved youth from diverse communities so they can further their education. In 2006, these associations awarded a total of $136,750 in scholarships, an increase of more than 25 percent from 2005. These scholarships enabled more than 100 youth from throughout our service area to pursue educational opportunities at the college level.
Providing Seed Funding to Audubon California to Support Educational
Programs and Habitat Restoration at the 6,800-acre Bobcat Ranch.
Home to
important blue oak, chaparral and riparian habitat, the Bobcat Ranch also connects

A bird box is installed with the help of a local student, as part of Audubon California's large-scale restoration effort at the Bobcat Ranch. Photo: Audubon California Landowner Stewardship Program.

to the 750,000-acre Blue-Ridge Berryessa Natural Area, a large area of oak woodland and grassland habitat unique to Northern California. In 2007, PG&E will be participating with Audubon's Landowner Stewardship Program to enhance native riparian vegetation at the company's natural gas storage facility, located in close proximity to Bobcat Ranch.
Supporting the Center for Advanced Research and Technology. We have helped in efforts to equip high school juniors and seniors from the Fresno and Clovis Unified school districts with the tools necessary to solve local environmental problems. Students collaborated with research and regulatory organizations to restore native habitat, research the effects of temperature and chemical fluctuations on coral, and collect and analyze water quality samples to assess the health of local water bodies.
Expanding Employee Giving to More Community Organizations. In addition to the nearly $14.7 million in shareholder-funded contributions granted in 2006, PG&E's employees again demonstrated a great commitment to nonprofit organizations in their communities through the company's Campaign for the Community. PG&E expanded its campaign effort with new incentives for employees and increased support from senior management. Donations pledged in 2006 exceeded $3.2 million, compared with $2.7 million in 2005. These donations, made by nearly 7,150 employees and retirees, will help support more than 3,000 organizations throughout our service area and beyond.