PG&E: Hanging on to a Ray of Hope (pdf abstract)
Purchase the full report on GlobaLens (Case study # 1-429-377)– published 02/2014, 16 pages.
Developed by: Chris Wolff, Masayuki Kawasaki, Natalie Guishar, and John Serron (’16) under the supervision of Andrew Hoffman
DESCRIPTION: Pacific Gas & Electric (PG&E), along with other California utilities, is facing a challenge to its long-term viability. Solar is becoming increasingly popular in California, as the economics have gradually made solar more attractive to the state’s residents. The California legislature and California Public Utilities Commission (CPUC) have furthered the transformation, through an ambitious Renewable Portfolio Standard (RPS) and policies such as net metering. PG&E’s market share has eroded and its profit structure has been turned on its head, leaving upper management facing existential questions. This case was written under the supervision of Andrew Hoffman, director of the Erb Institute, by graduate students Chris Wolff, Masayuki Kawasaki, Natalie Guishar, and John Serron at the University of Michigan.
TEACHING POINTS:
After reading and discussing this case, students should be able to:
- Explain PG&E’s dilemma with respect to solar power.
- Describe some of the options PG&E is considering as it tries to chart a viable and successful path forward.
- Compare and contrast PG&E’s experience with other industries whose core business models are being threatened.