PG&E has rejected a $2.5 billion offer from the city of San Francisco to buy the utility's local power lines.

In a letter to city officials, PG&E said the city’s offer was too low. The utility also said that the city underestimated substantial costs and, if PG&E sold the assets to the city, customers would see their rates rise.

"Our San Francisco-based facilities are not for sale and to do so would not be consistent with our charter to operate or our mission to serve Northern and Central California communities," said PG&E CEO and President Bill Johnson in the letter.

He went on to say that they "disagree with the suggestion that PG&E's San Francisco customers would be better served by another entity."