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's Response to California Senate

PACIFIC GAS AND ELECTRIC COMPANY RESPONDS TO STATE SENATE COMMITTEE; IT DID NOT ENGAGE IN ENRON-LIKE TRADING ACTIVITIES

Filing Also Tells Committee the Utility Properly Bid Its Resources Into the Market

(SAN FRANCISCO - Pacific Gas and Electric Company today informed the California State Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market that it did not engage in Enron-style trading activities.

In the same filing, the utility described its load forecasting and submission process and told the Committee that it accurately provided its generation and demand data to the California Independent System Operator (CAISO) and California Energy Resources Scheduling (CERS) officials to determine the utility's "net open" position for which CERS buys power.

As part of this process, PG&E works with CERS to implement procedures where the utility supplies CERS and the CAISO rolling seven-day forecasts, at least twice per business day. Additional updates are made if there are significant changes in the forecast conditions.

The Committee asked California's investor-owned electric utilities and other energy providers to submit information on their power marketing and trading activities in the California energy market. Several of the Committee's questions were similar to ones raised by the Federal Energy Regulatory Commission (FERC). In its response to FERC, which was also provided to the Committee, the utility stated that it did not engage in Enron-like trading practices.

Copies of PG&E's responses to the Committee and FERC are available on the utility's website at www.pge.com.