Parties to the Gas OII PG&E Settlement:

Last week, the CPUC approved the Comprehensive PG&E Settlement Agreement,
resolving all issues concerning PG&E in the Gas Strategy Investigation.  The
next step is getting the tariffs approved.  A revised draft of proposed
tariffs is attached.  In addition, attached please find a list of issues
raised at the draft tariff workshop PG&E hosted on April 10, 2000 (as well
as a few issues that were provided more recently), along with PG&E's
proposed resolution of those issues.

Issue Resolution Matrix:
 <<APRIL 10  ISSUES RESMATRIX 5-25-2000.doc>>

Core Storage Unbundling and Billing Credits:
 <<CTAgreement 5-25-2000.doc>>  <<CTAAttach-D 5-25-2000.doc>>
<<CTAAttach-I-5-25-2000.doc>>  <<CTAAttach-J-5-25-2000.doc>>  <<Attachment K
5-25-00.doc>>  <<creditapp 5-25-2000.doc>>  <<G-CRED5-25-2000.doc>>  <<G-CFS
5-25-2000.doc>>  <<G-CT 5-25-2000.doc>>  <<RULE 23 5-25-2000.doc>>

Meter Add On and Ownership:
 <<MeterAddOnTariff 5-25-2000.doc>>  <<MeterOwnershipTariff 5-25-2000.doc>>

Preliminary Statements:
 <<PrelimGLBCA 5-25-2000.doc>>  <<PrelimGPSAG-5-24-2000.doc>>
<<PrelimGPSC-5-25-2000.doc>>

Balancing and related rules:
 <<RULE14 5-25-2000.doc>>  <<Rule21-2 5-25-2000.doc>>  <<RULE25
5-25-2000.doc>>  <<SBAmendment 5-25-2000.doc>>
> This version of Schedule G-BAL has been re-organized and will look
> different than the version PG&E provided to the parties on March 28, 2000.
> In this version, the Balancing rules include two distinct sections as
> noted in the left hand margin: Monthly Balancing and Self-Balancing.  All
> the language from the current tariff is contained here as well as language
> from the March 28th version. Some additional language has been added for
> clarification and as a response to issues discussed in the April 10, 2000
> meeting.
>
>  <<G-BAL 5-25-2000.doc>>
We solicit any suggestions you may have on these drafts, preferably in
writing, to be sent on or before Friday, June 9, 2000, to the attention of
Stu Tartaglia (SET2@PGE.com), Steve Moorleghen (SBM2@PGE.com), and Randy
Litteneker (RJL9@PGE.com).  In addition, we will hold a half-day tariff
workshop to discuss these draft tariffs on Tuesday, June 13th.  Details of
the time and room number for that workshop will follow.

We must file the tariffs with the CPUC by July 17, 2000.  A detailed
schedule for completion of these tariffs is attached.  We look forward to
working with you to complete these tariff changes.

> Ron Stoner     Randy Litteneker
> (415) 973-3606    (415) 973-2179
>
>
 <<OII Tariff Schedule for Parties_.doc>>

 - APRIL 10  ISSUES RESMATRIX 5-25-2000.doc
 - CTAgreement 5-25-2000.doc
 - CTAAttach-D 5-25-2000.doc
 - CTAAttach-I-5-25-2000.doc
 - CTAAttach-J-5-25-2000.doc
 - Attachment K 5-25-00.doc
 - creditapp 5-25-2000.doc
 - G-CRED5-25-2000.doc
 - G-CFS 5-25-2000.doc
 - G-CT 5-25-2000.doc
 - RULE 23 5-25-2000.doc
 - MeterAddOnTariff 5-25-2000.doc
 - MeterOwnershipTariff 5-25-2000.doc
 - PrelimGLBCA 5-25-2000.doc
 - PrelimGPSAG-5-24-2000.doc
 - PrelimGPSC-5-25-2000.doc
 - RULE14 5-25-2000.doc
 - Rule21-2 5-25-2000.doc
 - RULE25 5-25-2000.doc
 - SBAmendment 5-25-2000.doc
 - G-BAL 5-25-2000.doc
 - OII Tariff Schedule for Parties_.doc