EDITORS: Please do not use "Pacific Gas and Electric" or "PG&E" when referring to PG&E Corporation or its National Energy Group. The PG&E National Energy Group is not the same company as Pacific Gas and Electric Company, the utility, and is not regulated by the California Public Utilities Commission. Customers of Pacific Gas and Electric Company do not have to buy products or services from the National Energy Group in order to continue to receive quality regulated services from Pacific Gas and Electric Company.

PG&E CORP. MOVES TO DISMISS ATTORNEY GENERAL'S LAWSUIT

San Francisco - PG&E Corporation (NYSE: PCG) today filed a motion in the Northern District U.S. Bankruptcy Court to dismiss a lawsuit filed against the Corporation by the California Attorney General. The Corporation said the attorney general's complaint illegally interferes with the court's supervision of Pacific Gas and Electric Company's plan of reorganization process and illegally seeks to punish PG&E Corporation for co-sponsoring the plan of reorganization.

The attorney general's complaint alleges that PG&E Corporation and its directors made improper use of the Bankruptcy Court by virtue of PG&E Corporation's co-sponsoring of the pending Plan of Reorganization. It also seeks restitution of assets allegedly wrongfully transferred to PG&E Corporation from Pacific Gas and Electric Company.

The financial transactions cited by the attorney general have been thoroughly reviewed and audited multiple times - by the California Public Utilities Commission, and by the state Legislature - with no findings that the transactions were anything but entirely appropriate and legal.

The company said it believes the attorney general's complaint is without merit, and is part of his ongoing efforts to obstruct Pacific Gas and Electric Company's plans for emerging from bankruptcy.