BETHESDA, Md., - PG&E Corporation's (NYSE: PCG) PG&E National Energy Group (PG&E NEG) today announced that it has eliminated credit ratings triggers with respect to $889 million in financial commitments.

Ratings triggers are clauses in financing agreements that require a company to maintain a certain level of investment grade credit ratings. Failure to maintain the specified ratings trigger a requirement for the company to post collateral, take other action, or pay back the debt. Such obligations have come under increasing scrutiny by the financial community because they can exacerbate a company's liquidity position and actually contribute to the inability to meet financial obligations.

Working with lenders, PG&E NEG restructured financing arrangements including $609 million in equity commitments for the Lake Road and La Paloma power plants and a $280 million guarantee backing the equipment revolving credit facility. Ratings triggers had been removed earlier from PG&E NEG's guarantee backing its remaining $701 million equity commitment from the GenHoldings I, LLC portfolio financing.

In place of the ratings triggers in these facilities, the lenders have agreed to substitute specific financial covenants that are consistent with those contained in PG&E NEG's revolving credit and other loan facilities.

"We have worked carefully with the lenders to develop this package of covenants and reporting requirements to replace ratings triggers," said John Cooper, PG&E NEG's senior vice president for finance. "We remain committed to maintaining credit quality, preserving liquidity and strengthening our balance sheet."

Lake Road Generating is an 840-megawatt natural gas-fired combined-cycle plant located in Killingly, Conn. that recently went operational. La Paloma Generating is an approximately 1,121-megawatt natural gas-fired combined-cycle generating facility currently under construction in Kern County, California. It is expected to begin operations in late 2002.

PG&E National Energy Group is rated BBB by Standard & Poor's with a stable outlook and Baa2 by Moody's with a negative outlook.

Headquartered in Bethesda, Md., PG&E National Energy Group develops, builds, owns and operates electric generating and natural pipeline facilities and provides energy trading, marketing and risk-management services.