Higher rates lift PG&E; earnings

PG&E; Corp., owner of California’s largest utility, said second-quarter profit rose 8.9% on higher rates.

Net income increased to $293 million, or 80 cents a share, from $269 million, or 74 cents a share, a year earlier, the San Francisco-based company said. Revenue climbed 12% to $3.58 billion.

California utilities are spending more on electricity generators and power lines to bolster reliability and meet rising demand from a growing population.

Last year, California regulators said the company’s Pacific Gas & Electric utility could raise rates by $213 million in 2007 and by $125 million annually from 2008 through 2010.

The company’s per-share earnings missed by 2 cents the average of analyst estimates compiled by Bloomberg. Shares of PG&E; fell 70 cents to $37.80.

The company’s Pacific Gas & Electric utility provides power to about 5.1 million homes and businesses and natural gas to 4.3 million. Electricity revenue rose 12% in the second quarter, compared with a year earlier, PG&E; said. Natural-gas revenue rose 13%.