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: June 6, 2001
Exact Name of
Commission Registrant State or other IRS Employer
File as specified Jurisdiction of Identification
Number in its charter Incorporation Number
- ---------- -------------- --------------- --------------
1-12609 PG&E Corporation California 94-3234914
1-2348 Pacific Gas and California 94-0742640
Electric Company
Pacific Gas and Electric Company PG&E Corporation
77 Beale Street, P.O. Box 770000 One Market, Spear Tower, Suite 2400
San Francisco, California 94177 San Francisco, California 94105
(Address of principal executive offices) (Zip Code)
Pacific Gas and Electric Company PG&E Corporation
(415) 973-7000 (415) 267-7000
(Registrant's telephone number, including area code)
Item 5. Other Events.
Pacific Gas and Electric Company Bankruptcy
As previously disclosed, Pacific Gas and Electric Company (Utility),
the California utility subsidiary of PG&E Corporation, had filed a
complaint against the California Public Utilities Commission (CPUC) and
its Commissioners requesting that the U.S. Bankruptcy Court for the
Northern District of California issue an injunction to prohibit the
enforcement of the CPUC's March 27, 2001 decision adopting changes to
the transition period accounting mechanisms. On June 1, 2001, the
Bankruptcy Court issued a decision denying the Utility's request and
granting the CPUC's motion to dismiss the complaint. Although the Court
held that the Eleventh Amendment to the U.S. Constitution did not bar
the Utility's suit against the individual Commissioners, the Court
concluded that the Utility was not entitled to a stay or an injunction
to prevent implementation and enforcement of the regulatory accounting
order. First, the Court held that, assuming the Bankruptcy Code
provision imposing an automatic stay on pre-petition proceedings might
ordinarily apply (an issue that the Court expressly declined to decide),
the Court determined that the Commissioners were acting pursuant to
their police and regulatory power when issuing the order. Accordingly,
the Court found that the order was exempt from the automatic stay
provision pursuant to a statutory exemption for the commencement or
continuation of an action or proceeding by a governmental unit to
enforce such governmental unit's police and regulatory power. Second,
the Court held that the Utility had not shown any actual or threatened
violation of federal law sufficient to warrant injunctive relief, nor
did the balance of equities favor an injunction.
The Utility believes that the retroactive accounting changes by which
the Utility's under-collected power purchases costs would be transformed
into under-collected transition costs unlawfully delays the termination
of the rate freeze. The Utility has advised the CPUC that the rate
freeze ended at least as early as August 2000. The Utility will
continue to pursue all legal challenges to this unlawful CPUC decision.
The Utility's application for rehearing of this decision is pending at
the CPUC.
As previously reported, at December 31, 2000, the Utility wrote off
certain regulatory balancing accounts related to transition costs and
under-collected power purchase costs, among other items, as the Utility
was unable to conclude that such assets were probable of recovery under
applicable accounting standards. During the first quarter of 2001, the
Utility expensed power purchase costs, including estimated charges from
the ISO for its power purchases. In the absence of regulatory balancing
accounts, the Utility's earnings will be subject to much greater
volatility than in the past, as fluctuating revenues and expenses will
be reflected in reported earnings rather than recorded or deferred in
balancing accounts which previously permitted revenues and expenses to
be spread out and matched over a longer period. PG&E Corporation's
earnings also will be subject to increased volatility reflecting the
volatility of the Utility's earnings.
Item 9. Other Events
The information in this Current Report on Form 8-K, including the
exhibit listed below, is being furnished, not filed, pursuant to
Regulation FD. The information in this report and in such exhibit shall
not be incorporated by reference into any registration statement filed
pursuant to the Securities Act of 1933, as amended. The information
furnished in this Current Report on Form 8-K and in such exhibits
relates to the Utility.
Pursuant to Bankruptcy Court procedures, the Utility is required to
file monthly operating reports with the U.S. Bankruptcy Court for the
Northern District of California. On June 5, 2001, the Utility filed an
unaudited income statement for the month ended April 30, 2001 and an
unaudited balance sheet dated April 30, 2001. Both statements are
attached as Exhibit 99 to this report.
Exhibit 99 - Pacific Gas and Electric Company Income Statement for
the month ended April 30, 2001 and Balance Sheet dated April 30, 2001
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
Vice President and Controller
PACIFIC GAS AND ELECTRIC COMPANY
By: DINYAR B. MISTRY
-----------------------------
DINYAR B. MISTRY
Vice President and Controller
Dated: June 6, 2001