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PG&E ISSUES STATEMENT FOLLOWING DWR'S RELEASE OF LOWER REVENUE REQUIREMENT

SAN FRANCISCO -- Pacific Gas and Electric Company today issued the following statement after the California Department of Water Resources (DWR) released its revised revenue requirement:

"After an initial review, we are encouraged by DWR's announcement that their revenue requirement is approximately $4 billion lower than previously estimated. The new revenue requirement appears to reflect the changing market conditions that have led to lower gas and electricity prices.

"It is not yet clear how these new numbers interact with the California Public Utilities Commission's proposed $600 million cost shift between Northern and Southern California customers. We continue to support a fair and balanced distribution of costs between all utility customers, as DWR originally proposed.

"These new figures are another positive step in resolving the state's energy crisis. We look forward to working with the Governor in his on-going efforts to lower wholesale electricity prices and bring stability back to the market for our customers.

"We hope this development will facilitate efforts by Treasurer Angelides, DWR, and other parties to quickly and fully recover the state's power purchase costs."