Pacific Gas & Electric (PCG)

FOR IMMEDIATE RELEASE February 18, 2005

CONTACT: PG&E Corporation

PG&E CORP. REPORTS FOURTH QUARTER AND FULL YEAR 2004 FINANCIAL RESULTS

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Fourth quarter 2004 consolidated net income reported under GAAP was $2.04 per share. (All "per share" amounts are presented on a diluted basis.)



•

Earnings from operations were $0.44 per share for the quarter.



•

Full-year GAAP results were $10.57 per share, due largely to one-time, non-cash items.



•

Full-year earnings from operations were $2.12 per share.



•

Guidance for 2005 earnings from operations is reaffirmed at $2.15 to $2.25 per share.

        (San Francisco)—PG&E Corporation's (NYSE: PCG) consolidated net income as reported in accordance with generally accepted accounting principles (GAAP) was $871 million, or $2.04 per share for the fourth quarter of 2004. As previously reported, a one-time, non-cash item related to the elimination of the Corporation's equity interest in its former national energy unit increased GAAP results by $684 million, or $1.60 per share. Consolidated net income in the fourth quarter of 2003 was $37 million, or $0.09 per share.

        On a non-GAAP earnings-from-operations basis, earnings for the fourth quarter were $186 million, or $0.44 per share, compared with $139 million, or $0.33 per share, in 2003. Earnings from operations excludes certain non-operating income and expenses. These items are shown as "Items Impacting Comparability" on the attached financial tables, which reconcile earnings from operations with consolidated net income as reported in accordance with GAAP.

        For Pacific Gas and Electric Company alone, fourth quarter earnings from operations were $191 million, or $0.45 per share, compared with $141 million, or $0.34 per share, in 2003.

        The quarter-over-quarter difference in earnings from operations primarily reflects the effects of the delayed 2003 General Rate Case (GRC) decision. The net effect was approximately $0.11 per share that otherwise would have been reflected in fourth quarter of 2003 earnings from operations.

        Other factors impacting the quarter-over-quarter difference include about $0.06 per share of earnings on the Chapter 11 settlement regulatory asset in the fourth quarter of 2004, as well as $0.06 per share from higher electric and gas transmission revenues. Higher electric transmission revenues were driven by electric transmission rate decisions, and higher gas transmission revenues reflected the effects of colder-than-normal weather. These positive items were offset by $0.07 per share of additional costs from a second scheduled refueling outage at the Diablo Canyon power plant, with the remaining $0.05 per share due to a higher number of shares outstanding and other items.

FOR IMMEDIATE RELEASE February 18, 2005

CONTACT: PG&E Corporation

PG&E CORP. REPORTS FOURTH QUARTER AND FULL YEAR 2004 FINANCIAL RESULTS

•

Fourth quarter 2004 consolidated net income reported under GAAP was $2.04 per share. (All "per share" amounts are presented on a diluted basis.)



•

Earnings from operations were $0.44 per share for the quarter.



•

Full-year GAAP results were $10.57 per share, due largely to one-time, non-cash items.



•

Full-year earnings from operations were $2.12 per share.



•

Guidance for 2005 earnings from operations is reaffirmed at $2.15 to $2.25 per share.

        (San Francisco)—PG&E Corporation's (NYSE: PCG) consolidated net income as reported in accordance with generally accepted accounting principles (GAAP) was $871 million, or $2.04 per share for the fourth quarter of 2004. As previously reported, a one-time, non-cash item related to the elimination of the Corporation's equity interest in its former national energy unit increased GAAP results by $684 million, or $1.60 per share. Consolidated net income in the fourth quarter of 2003 was $37 million, or $0.09 per share.

        On a non-GAAP earnings-from-operations basis, earnings for the fourth quarter were $186 million, or $0.44 per share, compared with $139 million, or $0.33 per share, in 2003. Earnings from operations excludes certain non-operating income and expenses. These items are shown as "Items Impacting Comparability" on the attached financial tables, which reconcile earnings from operations with consolidated net income as reported in accordance with GAAP.

        For Pacific Gas and Electric Company alone, fourth quarter earnings from operations were $191 million, or $0.45 per share, compared with $141 million, or $0.34 per share, in 2003.

        The quarter-over-quarter difference in earnings from operations primarily reflects the effects of the delayed 2003 General Rate Case (GRC) decision. The net effect was approximately $0.11 per share that otherwise would have been reflected in fourth quarter of 2003 earnings from operations.

        Other factors impacting the quarter-over-quarter difference include about $0.06 per share of earnings on the Chapter 11 settlement regulatory asset in the fourth quarter of 2004, as well as $0.06 per share from higher electric and gas transmission revenues. Higher electric transmission revenues were driven by electric transmission rate decisions, and higher gas transmission revenues reflected the effects of colder-than-normal weather. These positive items were offset by $0.07 per share of additional costs from a second scheduled refueling outage at the Diablo Canyon power plant, with the remaining $0.05 per share due to a higher number of shares outstanding and other items.