CORP. OBTAINS WAIVER OF KEY RATINGS TRIGGER
Company Comments on Moody’s Investor Services Downgrade
of PG&E National Energy Group Credit Ratings
SAN FRANCISCO, Ca. – PG&E Corporation today issued the
following statement following Moody’s Investors Service credit
rating downgrade for the Corporation’s PG&E National Energy
Group (PG&E NEG) and the PG&E NEG’s primary operating
“The lenders in the Corporation’s credit agreement
with General Electric Capital Corporation, Lehman Commercial Paper
Inc, and certain other lenders have provided a waiver through August
16, 2002, of the requirement that the PG&E National Energy Group
maintain an investment grade credit rating by either Standard &
Poor’s or Moody’s Investor Services.
“We are now working with these lenders to discuss long-term
modifications to this lending agreement, as our team has done successfully
in the past. We look forward to reaching an agreement soon.
“Although the action by Moody’s is a disappointment,
we continue to believe the fundamentals in our national energy business
and its operating units are solid. As emphasized in the Corporation’s
conference call last week with the financial community, the PG&E
NEG is continuing to implement aggressive measures aimed at reducing
expenses and financing needs going forward.
“The action by Moody’s does not result in substantial
incremental impacts at the PG&E NEG beyond those associated
with last week’s credit action by Standard and Poor’s.
“The PG&E NEG has reviewed its estimated sources and uses
of cash over the next 12 months, and we believe that the company’s
liquidity is sufficient to meet the anticipated cash requirements,
including those associated with the rating agencies’ actions,
including Moody’s action today. The PG&E NEG’s liquidity
analysis appears in its 10Q filed Friday with the U.S. Securities
and Exchange Commission.”