3: SECURITIES AND EXCHANGE COMMISSION

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: November 30, 2001

 


Commission
File
Number

Exact Name of
Registrant
as specified in
its charter


State or other
Jurisdiction of
Incorporation


IRS Employer
Identification
Number

_____________

_____________

_____________

_____________

1-12609

1-2348

333-66032

PG&E Corporation

Pacific Gas and
Electric Company

PG&E National Energy Group, Inc.

California

California

Delaware

94-3234914

94-0742640

94-3316236

Pacific Gas and Electric Company
77 Beale Street, P. O. Box 770000
San Francisco, California  94177

PG&E Corporation
One Market, Spear Tower, Suite 2400
San Francisco, California  94105

PG&E National Energy Group, Inc.
7600 Wisconsin Avenue
Bethesda, Maryland  20814

(Address of principal executive offices) (Zip Code)

Pacific Gas and Electric Company
(415) 973-7000

PG&E Corporation
(415) 267-7000

PG&E National Energy Group, Inc.
(301) 280-6800

(Registrant's telephone number, including area code)

Item 5. Other Events.

PG&E Corporation's subsidiaries, PG&E National Energy Group, Inc. (PG&E NEG) and Pacific Gas and Electric Company (Utility), have separate contractual relationships with Enron Corporation, including its subsidiaries or affiliates (Enron). As has been widely reported, the major credit rating agencies have downgraded Enron's credit ratings to below investment grade.

Enron currently owes the Utility damages as a result of an energy contract termination. The market value of the termination to be paid to the Utility is in dispute, but the Utility is drawing on letters of credit of approximately $100 million, which would reduce the risk of nonpayment almost entirely.

PG&E NEG's current pre-tax uncollateralized trading exposure to Enron is approximately $8 million for which reserves will be established. In addition, PG&E NEG has certain forward commodity hedge contracts with Enron in connection with hedging its assets over the next five years. These contracts have a market value of approximately $70 million based on forward prices. PG&E NEG is evaluating the appropriate level of reserves, if any, with respect to these hedging contracts.

PG&E Corporation does not believe that the matters discussed above will have an adverse impact on PG&E Corporation's previously announced growth target for 2002 earnings per share from operations, even though it will have to evaluate in 2001 the appropriate level of reserves related to the forward commodity hedges.

This report contains forward-looking statements about the potential impact of Enron's deteriorated creditworthiness and guidance about PG&E Corporation's 2002 earnings per share. These statements are subject to various risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward looking statements. Information about the issues that could lead to material changes in performance is contained in the companies' reports filed with the Securities and Exchange Commission. Some of the factors that could cause results to differ materially include:



SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.

 

 

 

PG&E CORPORATION

 

By: CHRISTOPHER P. JOHNS        

 

     ________________________________________

 

     CHRISTOPHER P. JOHNS
     Senior Vice President and Controller

 

   
 

PACIFIC GAS AND ELECTRIC COMPANY

 

By: DINYAR B. MISTRY        

 

     ________________________________________

 

     DINYAR B. MISTRY
     Vice President and Controller

   
 

PG&E NATIONAL ENERGY GROUP, INC.

 

By: THOMAS E. LEGRO        

 

     ________________________________________

 

     THOMAS E. LEGRO
     Vice President, Chief Accounting Officer
      and Controller

Dated: November 30, 2001