PG&E; profit rises on higher rates

PG&E; Corp., owner of California’s largest utility, said second-quarter profit rose 16% on higher electricity rates.

Net income climbed to $269 million, or 74 cents a share, from $232 million, or 65 cents, a year earlier, the San Francisco-based company said. Sales rose to $3.19 billion from $3.02 billion.

PG&E;’s utility, Pacific Gas & Electric, has been successful in gaining regulatory approval for general rate increases and investments in power plants and upgraded meters. Higher revenue from general rates added 9 cents a share to earnings for the quarter, while operating and maintenance costs fell by $60 million.

Pacific Gas received regulatory approval in March for a $213-million, or 4.5%, general rate increase this year.

PG&E; was expected to earn 66 cents a share during the second quarter, based on the average of analyst estimates compiled by Bloomberg.

The company also said it still expected to meet a previous forecast that annual earnings would be in the range of $2.70 to $2.80 a share. For 2008, the company repeated its earlier target of $2.90 to $3 a share.

PG&E; shares rose $1.20, or 2.7%, to $46.36.