Pacific Gas & Electric (PCG)

NOTE 2: THE UTILITY’S CHAPTER 11 FILING

As a result of the California energy crisis, the Utility filed a voluntary petition for relief under the provisions of Chapter 11 on April 6, 2001. The Utility retained control of its assets and was authorized to operate its business as a debtor-in-possession during its Chapter 11 proceeding. PG&E Corporation and the subsidiaries of the Utility, including PG&E Funding LLC, (which issued rate reduction bonds) and PG&E Holdings LLC (which holds stock of the Utility), were not included in the Utility’s Chapter 11 proceeding. The Utility recorded its estimate of all valid claims of approximately $9.5 billion as liabilities subject to compromise at December 31, 2003, including interest on disputed claims and approximately $2.7 million of long-term debt.

NOTE 2: THE UTILITY'S CHAPTER 11 FILING

        As a result of the California energy crisis, the Utility filed a voluntary petition for relief under the provisions of Chapter 11 on April 6, 2001. The Utility retained control of its assets and was authorized to operate its business as a debtor-in-possession during its Chapter 11 proceeding. PG&E Corporation and the subsidiaries of the Utility, including PG&E Funding LLC, (which issued rate reduction bonds) and PG&E Holdings LLC (which holds stock of the Utility), were not included in the Utility's Chapter 11 proceeding. The Utility recorded its estimate of all valid claims of approximately $9.5 billion as liabilities subject to compromise at December 31, 2003, including interest on disputed claims and approximately $2.7 million of long-term debt.