PRESS RELEASES 2000 RELEASE
FOR IMMEDIATE RELEASE
September 11, 2000
Contact: Greg S. Pruett
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 UPDATES INDUSTRY ANALYSTS ON OUTLOOK FOR PG&E NATIONAL ENERGY GROUP

(New York) - In remarks to energy industry analysts today, Thomas G. Boren, President and CEO of PG&E Corporation's (NYSE: PCG) National Energy Group (NEG), reported on the unit's performance and on initiatives to continue to grow the business. He said the unit remains on target to deliver 30 percent of Corporation's total earnings by 2002. He credited the unit's strong performance in the first two quarters of 2000, in part, to the recently completed consolidation of the business and successful efforts to sharpen the NEG's strategy. Boren emphasized that the unit continues to take steps to boost its performance further.

Specifically, Boren said the NEG is focused on extracting greater value from its energy trading operations, accelerating the growth in "megawatts controlled" either through asset ownership or contractual arrangements, and enhancing its ownership and management of strategic natural gas transportation and storage assets.

Boren also said that as the NEG pursues these objectives, it is aggressively working to use its balance sheet and equity more efficiently, increasing capital velocity to boost returns. Examples include using more innovative asset ownership and management strategies such as tolling agreements, expanding the NEG's use of sophisticated financial structures to optimize leverage and risk, and monetizing assets and redeploying capital to higher value opportunities.

Boren said the NEG's program to develop new power plants continues to move forward with plants under construction or in development in key regions, including the West, the Northeast and the Midwest. These facilities represent more than 15,700 megawatts of capacity, in addition to the 7,000 megawatts currently controlled by the NEG. The NEG is also building its portfolio through new contractual arrangements, known as tolling agreements, that give it rights to supply fuel to and sell the power from facilities it does not own or operate, he said.

Achieving the NEG's overall growth objective goes well beyond building new power plants and pipelines, Boren said. He stressed the vital role the unit's energy trading and marketing organization must play in executing the NEG's strategy. The NEG trading and marketing group is expanding its role beyond that of a support function to that of a driver for growth through control of contractual assets, he said. The group is expanding its portfolio, diversifying its resources with a blend of physical and contractual energy assets, capturing efficiencies through e-business, and developing new products, Boren said.

Boren's overview was followed by remarks from senior members of the NEG management team. The presentations highlighted the NEG's capabilities and strategies in core competencies for success in the competitive market, including risk management, market assessment and valuation, transaction evaluation, and asset financing.

"The National Energy Group has the strategy and the full spectrum of skills and resources it takes to achieve its growth objectives and deliver solid, sustainable results to shareholders," Boren said. "Our performance in 2000 is the result of our focus and commitment to these goals, and a solid foundation on which we will build going forward."

PG&E Corporation, with revenues of more than $20 billion and operations in 21 states, markets energy services and products throughout North America through its National Energy Group. PG&E Corporation's businesses also include Pacific Gas and Electric Company, the Northern and Central California utility that deliver natural gas and electricity to one in every 20 Americans.

This press release contains forward-looking statements regarding the future performance of PG&E Corporation and its businesses. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially. Some of the factors that could cause actual results to differ materially include: the pace and extent of the ongoing restructuring of the electric and natural gas industries across the United States; future conditions in the energy markets; the extent to which current or planned generation development projects are completed and the pace and cost of such completion; generating capacity expansion and retirements by others; the Corporation's ability to successfully manage fluctuations in commodity gas and electricity prices; the method and timing of disposition and valuation of the Utility's hydroelectric generation assets; the timing of the completion of the Utility's transition cost recovery and the consequent end of the current electric rate freeze in California; the pace and extent of competition in the California generation market and its impact on the Utility's costs and resulting collection of transition costs; future operating performance of the Diablo Canyon Nuclear Power Plant; and other factors discussed in reports filed with the Securities and Exchange Commission by the Corporation and Pacific Gas and Electric Company.

 

Copyright © 2004 - PG&E Corporation. All Rights Reserved . feedback . privacy policy