BEFORE THE
PUBLIC UTILITIES COMMISSION
OF THE STATE OF CALIFORNIA

Application of Pacific Gas and Electric Company for Approval of Open Season Procedures for Awarding Firm Capacity on its Transmission Facilities

(U 39 G)		
Application No. 01-06-020

Reply Comments
of
Pacific Gas and Electric Company (U 39 G)

Pacific Gas and Electric Company (“PG&E”) respectfully submits the following reply comments pursuant to ALJ Brown’s order, issued June 14, 2001, i.e., “Administrative Law Judge’s Ruling Shortening Time for Protests or Responses and Replies to the Application Filed by Pacific Gas and Electric Company.”  PG&E has received comments or protests from seven parties: Office Of Ratepayer Advocates (“ORA”), California Cogeneration Council (“CCC”); Calpine Corporation (“Calpine”), Coral Energy Resources, L.P. (“Coral”); Northern California Generation Coalition and The Utility Reform Network (“NCGC” and “TURN”); and PanCanadian Energy Services, Inc. (“PanCanadian”).  PG&E responds as follows to the pleadings.
I.  ORA
The ORA asserts that all post Gas Accord issues, including approval of this open season, should be addressed on a comprehensive basis in one proceeding.  By the ORA’s own admission, the required time to process a comprehensive application will be quite lengthy – probably ending over 12 months from now.  In the meantime, the market for interstate and intrastate capacity is and will be moving forward at a rapid pace, with or without the participation of PG&E and many of its customers.  By its open season and application, PG&E only seeks to participate in this market under the rules already established by the Commission.
Interstate pipelines typically conduct open seasons prior to any formal application for construction and/or rates and in fact are doing so right now in order to provide direct service to PG&E customers.  If the ORA’s request to suspend the open season and to approve an open season in mid 2002 were adopted, a significant portion of the intra-state market would simply be put “on hold.”  By conducting the open season now, PG&E hopes to facilitate upstream interstate expansions and avoid potential supply constraints that will likely significantly increase market prices for all customers.  The ORA’s proposal to suspend the open season and litigate all issues until any action is taken is a strategy that could lead to delays in adding infrastructure and lead to sustained high prices similar to the electric industry.
The ORA suggests that the five questions posed in the ALJ “Order Shortening Time” raise issues requiring a thorough review, evaluation and analysis rather than speculative responses.  PG&E submits that none of the topics raised by the ALJ’s five inquiries require extensive and prolonged review at the present time.  Respecting core capacity: For instance, with respect to core capacity, PG&E is withholding from this open seasons more than sufficient capacity to satisfy any reasonable level of capacity to be assigned to the core for the future.  To address the ORA’s concerns regarding smaller, non-core customers, PG&E has taken steps to provide noncore customers with preferred access to capacity in the second open season to be held next year.  With two open seasons (the second one facilitating non-core access), the market will be able to decide the appropriate duration of the contracts.  PG&E is not forcing any customer to make more than a year commitment.  The ORA complains that PG&E’s market concentration limits are arbitrary.  Yet the ORA does not propose any alternative.  
In fact, the Commission approved no market concentration limits for the Gas Accord; yet for this post Gas Accord capacity, PG&E has imposed significant limits (including limits on affiliates), prompting some parties (such as Calpine) to complain that the limits are too low.  The “answer“ to market concentration limits cannot be an exact one, but must be a reasonable attempt to limit concentration.  PG&E has made that reasonable step to limit concentration.  Once a party obtains capacity, it may refuse to release it and may retain the benefits of the open season.  PG&E believes that continued “policing” of market concentrations in the secondary market will be counterproductive and would be a response to a problem (undue concentration) that does not exist on the current system.  
The ORA complains that PG&E provides no factual “evidence” that it requires fifteen-year contractual commitments to be competitive.  PG&E is not requiring fifteen-year commitments.  In fact, to participate in the open season, the minimum commitment is only one year.  The market will decide what contract terms are appropriate (and the market in the second open season may provide different responses as to appropriate terms).  PG&E is offering the opportunity to obtain long-term contracts because that is what many customers appear to desire.  If no customers desire a fifteen-year commitment, PG&E will not provide service under a 15-year contract.
The ORA – noting that many companies hold very long-term capacity on the upstream pipelines – acknowledges that a number of customers do need or desire long-term contracts.  PG&E believes there are customers who would like to secure capacity on the PG&E system to match their upstream positions.  Neither PG&E’s existing tariffs nor Commission policies prohibit long-term contracts.  PG&E need only seek Commission approval to enter into long-term agreements.
The ORA suggests, apparently critically, that the open season procedures are geared toward large marketers and large end-use customers.  PG&E has taken several steps to ensure that a variety of end-use customers may obtain capacity.  For example, PG&E has included a maximum acceptable award limit in the request form so that a smaller customer can request the maximum amount allowed without the risk that it would be awarded more capacity than it wants or could use.  Secondly, PG&E is offering capacity above 5 years in lengths of only 10 and 15 years.  This was done to reduce the uncertainty of a customer believing that it might have to bid 5 years, plus 1 month, or bid for 6 years, in order to obtain capacity over a reasonably short period.  Third, we believe that the most significant feature addressing the needs of smaller customers is the second open season to be held next year.  Under our open season plans, smaller customers will have more flexibility than under a plan that would tend to “push” end-users to bid for capacity in a first open season.  Under PG&E’s plan, smaller customers will have flexibility because they will the opportunity over the next year to sign supply arrangements with capacity holders obtaining capacity in this open season.  Then, if such customers believe they need more capacity, they may bid for their own capacity in the second open season.  (PG&E will file proposed rules for the second open season in its post Gas Accord filing.)  In conclusion, PG&E believes its open season plans provide important protections for smaller customers that wish to obtain their own capacity.
The ORA asserts that the market concentration limits require further “examination” and that the process PG&E proposes here fails to consider capacity limitations in the secondary market.  The reality is that ongoing market concentration limits would be difficult, at best, to police.  In D.99-07-015, “Order Identifying Promising Options for Further Study,” the Commission reaffirmed its long-standing policy of not regulating the prices, terms or conditions of secondary market transactions.  Instead, the Commission stated that it prefers to consider this type of regulation “only if market conditions warrant.”  Consistent with this policy, PG&E included the open season market concentration limits to limit the most serious attempts to corner the market for capacity.  However, as for continuing specified limits to “police” market concentration, PG&E respectfully submits that the Commission could study market concentration measures and secondary market controls for years and the large players will still find a way around the rules – particularly rules that appear to thwart market forces. 
The ORA complains that PG&E needs regulatory authority to hold the proposed open season and, having no regulatory authority, the process is somehow unlawful.  First, PG&E is seeking, in the instant application, the authority the ORA claims it does not have.  Further, PG&E’s approved tariffs do not limit its ability to sell firm transportation rights on its system beyond December 31, 2002.  Moreover, PG&E – mindful that it must apply its tariffs and provide service in a manner that is not unduly discriminatory – has designed the open season rules and structure to permit customers to request and obtain service in an open, reasonable and equitable manner.
The ORA is concerned that the open season procedures limit a negotiated settlement of the post Gas Accord issues.  Virtually, all the significant issues to be addressed by PG&E’s post Gas Accord filing are not pre-determined by the open season.  Nor does the award of capacity limit a party’s ability to advocate or negotiate acceptable solutions, including rates.  A number of parties already have long-term capacity with rates that fluctuate with each rate case.  Even “preferred access” to capacity by smaller noncore customers in the second open season is not precluded.  A significant amount of capacity is being withheld from this open season for a second open season.  The rules of the second open season will be included in PG&E’s post Gas Accord filing and the Commission will have the opportunity to approve such rules, after parties have provided input, prior to the second open season.
II.  California Cogeneration Council
CCC demands that the Commission permit PG&E to conduct the open season only after PG&E has made its decision on whether to assume or reject its qualifying facility (“QF”) Power Purchase Agreements (“PPA”).  Alternatively, if PG&E is to proceed with the open season at this time, co-generators should be given the option to terminate their capacity commitments without cost in the event that PG&E rejects their PPA's in PG&E’s bankruptcy proceeding.  PG&E does not believe that Commission review of this open season should be used to interfere with the normal processes of the bankruptcy court.  If a QF is successful in obtaining capacity in the open season then the only real question is whether it intends to operate under contract to PG&E (if PG&E assumes the QF purchase power agreement) or to sell its generation into the market (if PG&E should reject the QF contract).  Indeed, on June 19, 2001, the Federal Energy Regulatory Commission (“FERC”) ordered QFs to offer power not under contract to a utility in the ISO’s spot markets.  (Docket No. EL00-95-031, et al.)  Unless the QF intends to discontinue operations, a scenario which seems unlikely in California’s tight energy generation market, there is very little risk that a QF would not be able to use the capacity it obtains through the open season or would not be able to release capacity it to a third party in the secondary market.
CCC further suggests PG&E should waive the creditworthiness requirements that would otherwise be applicable to co-generators until PG&E pays the co-generators customers in full what is claimed to be owed to them under the PPA’s.  In establishing credit for Qualifying Facilities (QFs) in this open season, PG&E will take into consideration any monies which may be due QFs from PG&E under long term-power purchase agreements.
III.  Additional Comments of Coral and PanCanadian
CCC, Coral and PanCanadian assert that uncertainty over the rates for pipeline capacity will prejudice customers, particularly small customers or will limit participation in the open season.  Most pipeline capacity commitments in the United States are made without price guarantees provided by the pipeline including many of PG&E’s Line 401 contract holders.  Customers awarded capacity (and those who are not awarded capacity) have access to and will actively participate in the CPUC ratemaking process to ensure the rates adopted by the CPUC are fair and reasonable.  
PanCanadian further asserts that substantial subscriptions in the open season for Redwood path capacity would prejudice an argument (perhaps an argument that PanCanadian will make) to remove the price difference between the Redwood and Baja paths.  Since firm capacity on the Redwood path was completely sold for the term of Gas Accord I, PG&E does not need further commitments on the Redwood path to make the argument PanCanadian may fear.  Furthermore, given that a portion of each path’s capacity is being withheld for a second open season, the results of this open season will have no impact on any party’s litigation position on rates for the Gas Accord II period. 
PanCanadian would also like PG&E to “justify” why it has withheld capacity from this open season.  Instead of a second open season to help smaller customers, PanCanadian may believe it sees a conspiracy to “drive up” prices for capacity.  But, if anything, the second open season makes it less urgent for customers to participate in this open season and thereby lessens, not increases, the potential for higher value requests.  Beyond these observations, PG&E believes it has sufficiently and adequately addressed the rationale for the second open in these Reply Comments as well as in the initial Comments, filed June 20, 2001. 
Finally the CCC and PanCanadian suggest that PG&E is attempting to “preempt” its competitors by conducting the open season now.  PG&E does not believe it can “preempt” Its competitors.  Of course, PG&E does wish to compete.  Under the circumstances in the California market, PG&E believes that it has an appropriate set of assets and services to offer to the market and to compete effectively and serve customers.  PG&E’s open season is a wholly appropriate response to large out-of-state pipeline companies who wish to lock customers into long-term contracts and only serve a limited number of customers they deem profitable.  The result of the out-of-state pipelines coming into California is not only “healthy” competition, but increased costs for small customers.  The market, not PG&E, will have the last word.  If the market prefers the service offering of these competitors, then PG&E’s open season will have a limited response.  If customers prefer PG&E service, PG&E must be able to, right away, provide assurances that customers will have matching downstream capacity to match their interstate expansion capacity.  In addition, PG&E must be able to use the open seasons results to judge the extent of demand for intrastate pipeline capacity, in order to plan possible capacity expansions.
There is potential market demand for additional capacity.  For instance, Calpine suggests it will need substantially more pipeline capacity, up to 1.8Bcf/d of intrastate capacity.  Without customer commitments to capacity gained through this open season, PG&E has one less tool to judge how much additional capacity, if any, it should build. 
IV.  Northern California Generation Coalition and The Utility Reform Network
TURN and NCGC assert PG&E has the process “backwards.”  In fact, PG&E is following the way most open seasons are run for gas transmission capacity on interstate pipelines. 
TURN and NCGC wish the Commission to first address the issue of end-use customers having preference in obtaining pipeline capacity.  As noted above, this issue can be addressed in the rules for the second open season.  That open season will be held before January 1, 2003 and will provide for capacity with terms beginning post-Accord.  PG&E is withholding a significant amount of capacity, i.e., 325 MDth/d of annual capacity from this open season, to be allocated to customers next year.  The Commission may determine in PG&E’s post Gas Accord filing if end-use customers should have preference to that “second season” capacity.  The 325 MDth/d represents some 80% of PG&E’s noncore demand, excluding power plants, oil refineries and the largest QFs.
TURN and NCGC express a concern about a possible impact of an open season on the Department of Water Resources (DWR).  PG&E appreciates the concern.  PG&E will work with DWR to ensure it has all the information it needs to fully participate.  Indeed, one of the factors supporting PG&E’s decision to conduct an open season is support for long-term gas supply commitments for generators attempting to negotiate long-term electric generation supply agreements with the DWR.
TURN and NCGC argue the Commission would contradict its own recent statements to the FERC if it were to allow PG&E to proceed with an open season without “price caps.”  The institution of price caps is independent of any allocation of capacity through an open season.  Moreover, the Commission and parties will have ample opportunity to advocate just and reasonable or cost-based rates (read “price caps) and any secondary market controls, if necessary, for post-Gas Accord service.  
V.  Calpine
Calpine’s comments contrast with the ORA’s comments.  The comments demonstrate the diversity of the market and the appropriateness of the middle ground PG&E is proposing between no market concentration limits and the apparently lower market concentration limits that ORA may advocate.  Calpine argues for no proposed market concentration limits.  PG&E would be agreeable to run the open season without any market concentration limits, but believes that in proposing limits, we are addressing Commission concerns.
Calpine is concerned that PG&E will use, or withhold capacity for market center activities while including the capacity in transportation rates.  PG&E does not withhold transportation capacity from the market to benefit another service.  Because of the scheduling priority of services in PG&E’s tariffs, PG&E would not be able to withhold transportation capacity to benefit the market center.  PG&E’s market center services are “as-available” services with the lowest priority.  They are the first services interrupted whenever firm or as-available transportation volumes are nominated.  Under the Gas Accord structure, PG&E is at-risk for all transportation, storage and market center costs and revenues.  Accordingly, even if Calpine’s accusations were accurate, which they are not, there would be no impact on customer’s rates.  As we have stated many times before, the capacity withheld from the open season simply provides the Commission an opportunity to specify conditions for a second open season and will permit the parties and the Commission to make any changes in core capacity assignments.
Calpine would like PG&E to rank Redwood “off-system” capacity equally with Redwood “on-system,” when awarding capacity.  PG&E will continue to find higher economic value in Redwood off-system capacity even in the event that rates for the two paths are equal.  Off-system flows represent an incremental market for PG&E and a way to more fully utilize its system. The current Gas Accord rates used for ranking requests do approximate the higher economic value PG&E places on Redwood off-system gas flows.
Calpine would also like PG&E to accept fixed price and negotiated price bids in this open season.  This is a common practice in interstate open seasons.  However, when this is done, the pipeline holding the open season almost always has the right to accept or reject special offers based whether the pipeline believes the offer has benefits for the fixed price risk that the pipeline is taking.  PG&E believes that the market will provide sufficient interest in the PG&E pipeline capacity without the need to resort to these additional options and is choosing not to consider such special offers in this open season.
Calpine requests the Commission to expand cogen parity provisions to permit QFs who receive payments solely based on a Malin-based SRAC price by guaranteeing access to Malin unless the Commission modifies D.01-03-067 Decision Modifying Decision 96-12-028, D.01-03-067 (“Wood Decision”).  The Wood Decision is one of many Commission decisions that modify energy prices utilities pay QFs.  QF contracts with utilities expressly call for energy prices approved by the Commission from time to time.  We respectfully suggest that accommodating QFs for each and every modification the Commission makes to their energy prices is not a practical way to regulate a gas pipeline or the market generally.
VI.  CONCLUSION
PG&E believes it has presented a balanced open season proposal, appropriate for today’s market.  PG&E is hopeful that these comments will assist the Commission in approving an order on July 12, 2001 granting the approvals requested in PG&E’s Application.
Respectfully submitted,

JOSHUA BAR-LEV
LAWRENCE C. WITALIS
DAVID W. ANDERSON

By:   ______________________
        DAVID W. ANDERSON

Law Department
Pacific Gas and Electric Company
Post Office Box 7442 (Mail Code: B30A)
San Francisco, California 94120 
Telephone:  (415) 973‑6659	
Fax:  (415) 973-5520	
E-mail:  dwa3@pge.com

Attorneys for 	
PACIFIC GAS AND ELECTRIC COMPANY
June 25, 2001

EXHIBIT 1

Electronic Mail List used to Provide Reply Comments by E-mail on June 25, 2001

cab@cpuc.ca.gov; aamirali@caiso.com; adonnelly@prmllp.com; agold@coral-energy.com; alan.killion@williams.com; alex.sugaoka@uaecorp.com; askaff@energy-law-group.com; bbrunel@smud.org; bcope@ci.redding.ca.us; bcragg@gmssr.com; bhabersack@gasbiz.com; bmantz@sempra-slns.com; bobfraser@aec.ca; brad.king@usa.conoco.com; bradylaw@pacbell.net; bruce.a.connell@usa.conoco.com; burkee@cts.com; bwood@energy.state.ca.us; cabaker@duke-energy.com; ceyap@earthlink.net; cgoodman@energymarketers.com; charles.jacobini@acnenergy.com; chawes@txuenergy.com; cprice@igservice.com; craigc@calpine.com; csullivan@coral-energy.com; danny_macdonald@powerspring.com; dave.sloan@gt.pge.com; davef@abag.ca.gov; ddame@ncpa.com; djones@gasbiz.com; dmkellerton@ibm.net; dpk@cipa.org; dwswapp@duke-energy.com; ed@clfp.com; edwardoneill@dwt.com; egw@aelaw.com; eke@aelaw.com; epoole@adplaw.com; eric.eisenman@neg.pge.com; erin_m_delsing@reliantenergy.com; fillmotw@sce.com; frazier@bull.som.yale.edu; frl3@pge.com; girish_balachandran@city.palo-alto.ca.us; gjb2@pge.com; gnadeau@suncor.com; grant_kolling@city.palo-alto.ca.us; gregory_hood@oxy.com; gregs@mid.org; gsullivan@Sempra.com; gworster@txuenergy.com; hankd@calpine.com; healyb@epenergy.com; jdasovic@enron.com; jerryl@abag.ca.gov; jfawcet@enron.com; jfossum@westernhubs.com; jgopal@energy.state.ca.us; jhla@dynegy.com; jkarp@whitecase.com; jleslie@luce.com; jmartini@cipa.org; jnm@cpuc.ca.gov; joe.paul@dynegy.com; john_ulrich@city.palo-alto.ca.us; johnj@bcjlaw.com; jsuwara@sempra.com; judypau@dwt.com; justin_sutton@powerspring.com; jweil@aglet.org; jwr5532@aol.com; karen@klindh.com; karl@ncpa.com; katie_elder@rmiinc.com; keeling.robert@epenergy.com; keith.brown@swgas.com; khatz@titanenergy.com; khensman@aeraenergy.com; kl@mrwassoc.com; kmagruder@newpower.com; kmccrea@sablaw.com; kotoole@westernhubs.com; kpurbhoo@enron.com; kzemp@lightspeed.net; lbdr@powercomenergy.com; lindseyhowdowning@dwt.com; llorenz@pacent.com; marcel@turn.org; mbaldwin@igservice.com; mbornhoeft@socalgas.com; mcconnk@epenergy.com; mcollette@econone.com; mday@gmssr.com; mdjoseph@adamsbroadwell.com; mflorio@turn.org; michael.alexander@sce.com; michael_r._soland@oxy.com; mike.huk@gov.ab.ca; mmbr@dynegy.com; mmce@dynegy.com; mnyberg@energy.state.ca.us; mtbrommer@tid.org; napedersen@jonesday.com; nmcvay@socalgas.com; pat_mulhern@oxy.com; paulamirault@aec.ca; pbray@newpower.com; pcervin@br-inc.com; pete.frost@usa.conoco.com; peter.saunders@paramountres.com; Phanschen@mofo.com; phil@royl.com; pinney@capp.ca; pkeeler@br-inc.com; plg@cpuc.ca.gov; prescorw@bp.com; randy_richards@powerspring.com; raveen_maan@city.palo-alto.ca.us; rbetonte@socalgas.com; rcrowley@coral-energy.com; rdw0@pge.com; redavis@sempra.com; reson@venocoinc.com; rishikawa@socalgas.com; rliebert@cfbf.com; rmp@cpuc.ca.gov; rnagatani@venocoinc.com; robert.ricobene@exeloncorp.com; robertacohan@aol.com; rochmanm@cubjpa.org; rochmanm@spurr.org; rocky_rasley@oxy.com; ron_oechsler@rmiinc.com; rosst@nertec.com; rpurves@sdge.com; rroth@sempra-slns.com; salleyoo@dwt.com; sandra_mcdonough@pcp.ca; scohn@smud.org; slins@ci.glendale.ca.us; sross@state.nm.us; sslavigne@duke-energy.com; steve.huhman@mirant.com; steve_ponder@fpl.com; sturner2@newpower.com; swatson@socalgas.com; tdickers@westerngas.com; tlewis@titanenergy.com; tlr@capoil.com; tobi_rogers@vintagetul.com; tomb@crossborderenergy.com; tpeterso@energy.state.ca.us; tsurak@socalgas.com; vaughn.white2@williams.com; vhconsult@earthlink.net; wgmanuel@tid.org; wng@fpl.com; worthycg@bp.com; yukon95813@aol.com; zaiontj@pb.com; abb@eslawfirm.com; agoldberg@lgl.twc.com; alan_reid@pancanadian.ca; alfredo.huertas@enron.com; andy.bettwy@swgas.com; ascott@sdge.com; atrowbridge@dbsr.com; bburns@caiso.com; bdahncke@pcenergy.com; benledene@aec.ca; bfolsom@avistacorp.com; bgaillar@enron.com; bjeider@ci.burbank.ca.us; bmcc@mccarthylaw.com; bpedersen@igservice.com; bradb@calpine.com; btheaker@caiso.com; candjenterprises@home.com; chilen@llgm.com; chj@aelaw.com; chris.king@utility.com; cmkehrein@ems-ca.com; cottlli@sf.whitecase.com; cushnice@sce.com; cyowell@ziagroup.com; dalbers@avistacorp.com; david.bayless@utility.com; difellman@earthlink.net; dlevine@caiso.com; douglass@energyattorney.com; dwswapp@duke-energy.com; ecrem@ix.netcom.com; eklinkner@ci.pasadena.ca.us; ewo@jmbm.com; fergusonm@epenergy.com; fogelmanm@steefel.com; ghinners@reliantenergy.com; gnstillwagon@tid.org; gpickering@idahopower.com; gtbl@dynegy.com; gwright@sempra.com; haorndorff@aeraenergy.com; hgleason@energyamerica.com; iep@iepa.com; igsinc@ix.netcom.com; inggm@sce.com; jaime.ramirez@swgas.com; jamesauld@aec.ca; jbennett@gmssr.com; jcattermole@pcenergy.com; jharrigan@socalgas.com; jlinam@socalgas.com; jmackay@unitedgas.com; jmct@gmssr.com; jond@qstr.com; joseh@lif.org; jpjordan@swidlaw.com; jsqueri@gmssr.com; jsteffen@iid.com; jtachera@energy.state.ca.us; jurewijl@sce.com; jvaccaro@sdge.com; jyoung@igservice.com; kbhensman@aeraenergy.com; keith-sappenfield@reliantenergy.com; kfyip@seiworldwide.com; kirk.t.morgan@wgp.twc.com; kmills@cfbf.com; kpoole@adamsbroadwell.com; kschellin@mtpower.com; ljhubbard@sempra.com; lmh@eslawfirm.com; lynn.g.dahlberg@wgp.twc.com; mark.c.moench@wgp.twc.com; mcclintocke@epenergy.com; michael-briggs@reliantenergy.com; mjaske@energy.state.ca.us; mpa@aelaw.com; mpocino@rcgroup.com; mrokose@energyamerica.com; nge@value.net; office@mccarthylaw.com; oro@cpuc.ca.gov; oshirock@pacbell.net; paul.macavoy@yale.edu; phanschen@mofo.com; phildavies@aec.ca; pjpowerlaw@aol.com; plg@cpuc.ca.gov; pmoritzburke@cera.com; porterdk@sce.com; pstohr@dbsr.com; rbw@mrwassoc.com; rcooper@usg.com; rczahar@aol.com; regaffairs@sf.whitecase.com; rfoss@coral-energy.com; rgloistein@orrick.com; rhc@mrwassoc.com; richard.jordan@swgas.com; rick.counihan@greenmountain.com; rjl9@pge.com; rmccann@cal.net; robertg@greenlining.org; roger_tisdale@oxy.com; ronknecht@aol.com; rpetti@ladwp.com; rshively@enerdynamics.com; rtask@reliantenergy.com; scarter@nrdc.org; sedgar@socalgas.com; simonsen@rmi.net; skatz@sempratrading.com; smcfadden@igservice.com; sneiman483@aol.com; spb1@cwclaw.com; stomashe@energy.state.ca.us; stringham@capp.ca; tgary@pcenergy.com; thamilto@enron.com; thompson@wrightlaw.com; toca@utility-savings.com; tom.roth@et.pge.com; tsolberg@spurr.org; txb6@pge.com; mclark@dgs.ca.gov

CERTIFICATE OF SERVICE BY MAIL

	I, the undersigned, state that I am a citizen of the United States and am employed in the City and County of San Francisco; that I am over the age of eighteen (18) years and not a party to the within cause; and that my business address is Pacific Gas and Electric Company, Law Department B30A, 77 Beale Street, San Francisco, California 94105.

	 I am readily familiar with the business practice of Pacific Gas and Electric Company for collection and processing of correspondence for mailing with the United States Postal Service.  In the ordinary course of business, correspondence is deposited with the United States Postal Service the same day it is submitted for mailing.
		
	On the 25th day of June, 2001, I served a true copy of:

Reply Comments of Pacific Gas and Electric Company (U 39 G)

by placing it for collection and mailing, in the course of ordinary business practice, with other correspondence of Pacific Gas and Electric Company, enclosed in a sealed envelope, with postage fully prepaid, addressed to:

CPUC Official Service List For:  I.99-07-003

Marshall D. Clark
c/o OEA, Suite 409
717 K Street
Sacramento CA 95814

	I certify and declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. 

	Executed on the 25th of June 2001.

	AMY S. YU