----- Forwarded by Jeff Dasovich/NA/Enron on 01/31/2001 04:22 PM -----

	"Ronald Carroll" <rcarroll@bracepatt.com>
	01/31/2001 02:38 PM
		 
		 To: <jdasovic@enron.com>, <smara@enron.com>
		 cc: 
		 Subject: Fwd: PG&E Press Release Following Release of CPUC Audit


----- Message from "Tracey Bradley" <tbradley@bracepatt.com> on Wed, 31 Jan 
2001 08:44:20 -0600 -----
cc:	"Andrea Settanni" <asettanni@bracepatt.com>, "Charles Shoneman" 
<cshoneman@bracepatt.com>, "Jeffrey Watkiss" <dwatkiss@bracepatt.com>, "Paul 
Fox" <pfox@bracepatt.com>, "Ronald Carroll" <rcarroll@bracepatt.com>
Subject:	PG&E Press Release Following Release of CPUC Audit
Note:  When I checked, the audit report was not yet available on the CPUC web 
site.

Wednesday January 31, 12:31 am Eastern Time

Press Release

PG&E Issues Statement Following Release of CPUC Report

SAN FRANCISCO--(BUSINESS WIRE)--Jan. 30, 2001--Pacific Gas and Electric 
Company today issued the following statement, in response to the report 
released by the California Public Utilities Commission (CPUC): 

``It is premature to comment in detail about the CPUC report issued late 
today. We plan to study and evaluate this report thoroughly. As the CPUC is 
well aware: 

Pacific Gas and Electric Company procured power for its customers in 
accordance with all CPUC requirements, despite having to make purchases at 
rates substantially higher than those that it could charge to customers. As 
the CPUC report confirms, these purchases have resulted in uncollected 
amounts of $6.7 billion as of December 31, 2000.

The transfer of approximately $4 billion from Pacific Gas and Electric 
Company to PG&E Corporation was consistent with CPUC directives. PG&E 
shareholders invested their money to build the utility's power plants, and, 
under California law, when those plants were sold under deregulation, 
shareholders were entitled to recover their investments.

CPUC rules require sharp lines between the corporation's utility and 
non-utility businesses and establish a rigorous framework to ensure that 
those lines are observed. Ratepayers are not to subsidize the growth of 
PG&E's national business -- and they have not.

The report suggests that the use of affiliate earnings and greater cash 
conservation efforts could have made a difference. That is simply not the 
case. Even if the $117 million of NEG earnings that the report attributes to 
California were used to purchase power and the utility implemented Draconian 
cash conservation measures -- including laying off every management employee, 
reducing the rank-and-file workforce by an additional one-thousand employees, 
breaking contracts and implementing a salary freeze on Union employees -- the 
total savings would amount to less than one month's worth of power at current 
prices. 

``The important objective of all parties -- the utilities, lawmakers and 
regulators including the CPUC -- should be to move expeditiously to achieve a 
constructive solution to the energy crisis, which is threatening the safety 
of Californians and the economic well-being of the state.'' 

For more information about Pacific Gas and Electric Company, please visit our 
web site at http://www.pge.com. 


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Contact: 

     Pacific Gas and Electric
     News Department, 415/973-5930