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PG&E says CPUC amended order provides breathing room

SAN FRANCISCO, Calif., Jan. 4, 2001 (BUSINESS WIRE) — PG&E today commended the California Public Utilities Commission for recognizing the severity of the electricity price crisis facing California’s consumers by the adoption of its amended final decision.

The decision increases retail electric rates, addresses recovery of previously incurred costs by removing inappropriate language from the proposed decision, and identifies the need for the securitization as a mechanism to deal with undercollection of wholesale energy costs, PG&E said.

“This action by the CPUC should give us breathing room to allow the Governor and the Legislature to address the problem,” said Robert D. Glynn, Jr., Chairman, CEO and President of PG&E Corporation.

“This is the most substantive action we have seen in months on this crisis,” he said. “Initial reaction by the financial markets to this modified order has been positive.”

“Although this decision does not yet solve the problem,” Glynn said, “it is an important first step. Most importantly, the tone, as well as the content of the order, should provide adequate assurance to our lenders and suppliers that a solution to the problem is in the making and that they should continue to work with us while this solution is being finalized.”

Glynn noted that the Commission removed some, but not all of the retroactive accounting changes designed to artificially extend the rate freeze. “While we are still troubled by aspects of the decision that are not consistent with the law, we are encouraged that the Commission will finally hold hearings on the end of the rate freeze issue.”

Glynn added that now it is up to the Governor and the Legislature who have indicated that they are poised to address this serious problem, “and we have every confidence that they will take appropriate action,” he said. “I am guardedly optimistic that rational minds will prevail.”