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 CORPORATION OBTAINS EXTENSION OF WAIVER OF KEY RATINGS TRIGGER

SAN FRANCISCO - Lenders under PG&E Corporation's (NYSE:PCG) aggregate $1.02 billion term-loan agreement have agreed to continue to waive through October 21, 2002, subject to earlier termination under certain circumstances, the agreement's requirement that PG&E National Energy Group (PG&E NEG) maintain an investment grade credit rating by either Standard & Poor's or Moody's Investors Service.

Discussions with PG&E NEG's lenders are currently underway. PG&E Corporation said that it is continuing its discussions with its lenders, General Electric Capital Corporation, Lehman Brothers, and certain other lenders, to develop long-term modifications to its credit agreement.