November 08, 2000
Contact: Sandra McDonough, 503-833-4601
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.


The 550-megawatt plant would be the company's second Oregon generating station

PORTLAND, OR - PG&E Corporation's National Energy Group (NYSE: PCG) has filed an application with the Oregon Office of Energy to build a new generating station in Eastern Oregon's Umatilla County, adjacent to the company's operating power plant in Hermiston. The company said the new facility, slated to begin operation in 2003, will help meet the Northwest's growing energy needs.

"The PG&E National Energy Group has long had a strong business presence in the Pacific Northwest, including our natural gas transmission system and the Hermiston Generating Plant," said Thomas B. King, president and COO of the PG&E National Energy Group (NEG). "We hope to build on our experience in the region to become a major contributor in the effort to meet the region's growing energy demand. The Umatilla Generating Project is a key component of that strategy."

King noted that forecasts by the Northwest Power Planning Council show that the region has a one-in-four chance of experiencing an energy shortfall during winter months if new resources are not developed. To reduce that probability to a one-in-twenty chance, 3,000 megawatts of new electric generating capacity will need to be built before 2003. The proposed 550-megawatt Umatilla Generating Project would generate enough power for 550,000 homes.

The NEG has filed an application with the Oregon Office of Energy for a site certificate for the plant. The application was in the form of an amendment to a previous certificate filing made five years earlier. Roger Garratt, lead developer for the project, said the permitting process should take about a year. The company hopes to begin construction on the plant in early 2002.

"Based on our experience in siting and building the Hermiston Generating Plant five years ago, we are very familiar with the Oregon siting process and its focus on building consensus among the stakeholder groups," Garratt said. "We have already begun meeting with a number of interested parties, including representatives of the local community, and we look forward to continuing the effort."

The Umatilla Generating Project will be a highly efficient combined cycle combustion turbine, built adjacent to the 474-megawatt Hermiston Generating Plant, which the NEG co-owns with PacifiCorp. The two plants will share much of the same infrastructure, maximizing efficiencies. The Umatilla plant will burn natural gas, with its fuel supply transported via the NEG's Pacific Northwest natural gas pipeline system.

PG&E Corporation, with 1999 revenues of nearly $21 billion and operations in 21 states, markets energy services and products throughout North America through its National Energy Group. The Corporation has ownership and management interests in more than 30 power plants and has one of the largest energy trading and risk management programs in North America.

This news release discusses certain matters that may be considered "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding the intent, belief or current expectations of PG&E Corporation ("the Company") and its management or those of the PG&E National Energy Group and its management. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results such as, but not limited to, (i) changes in government regulations and anticipated deregulation of the electric energy industry; (ii) commercial operations of new plants that may be delayed or prevented because of various development and construction risks, such as a failure to obtain financing and the necessary permits or equipment to operate or the failure of third-party contractors to perform their contractual obligations, (iii) a competitor's development of a lower-cost generating gas-fired power plant, (iv) fluctuations in natural gas and electricity prices and the ability to successfully manage such price fluctuations or (v) the risks associated with marketing and selling power from power plants in the newly competitive energy market. Prospective investors are also referred to the other risks identified from time to time in the Company's reports and registration statements filed with the Securities and Exchange Commission.