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<title>Form 8-K Dated May 25, 2004</title>
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<p align="center"><font size="3" face="Times New Roman">SECURITIES AND EXCHANGE
COMMISSION</font></p>
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<tr>
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<p><font size="3" face="Times New Roman"><br />
 </font></p>
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<p align="center"><font size="3" face="Times New Roman">Washington,
D.C.&nbsp; 20549</font></p>
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<p><font size="3" face="Times New Roman"><br />
 </font></p>
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<p align="center"><font size="3" face="Times New Roman">FORM
8-K</font></p>
</td>
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<p><font size="3" face="Times New Roman"><br />
 </font></p>
</td>
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<p align="center"><font size="3" face="Times New Roman">CURRENT
REPORT</font></p>
</td>
</tr>

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<p><font size="3" face="Times New Roman"><br />
 </font></p>
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<p align="center"><font size="3" face="Times New Roman">Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of
1934</font></p>
</td>
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<td colspan="4" height="43" valign="top">
<p><font size="3" face="Times New Roman"><br />
 </font></p>
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<p align="center"><font size="3" face="Times New Roman">Date of
Report: May 25, 2004</font></p>
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<p><font size="3" face="Times New Roman"><br />
 </font></p>
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<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
</tr>

<tr>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman"><br />
 Commission<br />
 File<br />
 Number</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman">Exact Name
of<br />
 Registrant<br />
 as specified in<br />
 its charter</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman"><br />
 State or other<br />
 Jurisdiction of<br />
 Incorporation</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman"><br />
 IRS Employer<br />
 &nbsp; Identification<br />
 Number</font></p>
</td>
</tr>

<tr>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">_____________</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">_____________</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">_____________</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">_____________</font></p>
</td>
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<tr>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">1-12609<br />
 </font></p>

<p align="center"><font size="3" face=
"Times New Roman">1-2348</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman">PG&amp;E
Corporation<br />
 </font></p>

<p align="center"><font size="3" face="Times New Roman">Pacific Gas
and<br />
 Electric Company</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">California<br />
 </font></p>

<p align="center"><font size="3" face=
"Times New Roman">California</font></p>
</td>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">94-3234914<br />
 </font></p>

<p align="center"><font size="3" face=
"Times New Roman">94-0742640</font></p>

<p align="center"><font size="3" face="Times New Roman"><br />
 </font></p>
</td>
</tr>

<tr>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top"></td>
<td valign="top"></td>
<td valign="top"></td>
</tr>

<tr>
<td colspan="2" valign="top">
<p align="center"><font size="3" face="Times New Roman">Pacific Gas
and Electric
Company&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br />
 77 Beale Street, P. O. Box
770000&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br />
 San Francisco,
California&nbsp;&nbsp;94177&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td colspan="2" valign="top">
<p align="center"><font size="3" face="Times New Roman">PG&amp;E
Corporation<br />
 One Market, Spear Tower, Suite 2400<br />
 San Francisco, California&nbsp;&nbsp;94105</font></p>
</td>
</tr>

<tr>
<td colspan="4" valign="top">
<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
</tr>

<tr>
<td colspan="4" valign="top">
<p align="center"><font size="3" face="Times New Roman">(Address of
principal executive offices) (Zip Code)</font></p>
</td>
</tr>

<tr>
<td valign="top">
<p align="center"><font size="3" face="Times New Roman"><br />
 </font></p>
</td>
<td valign="top"></td>
<td valign="top"></td>
<td valign="top"></td>
</tr>

<tr>
<td colspan="2" valign="top">
<p align="center"><font size="3" face="Times New Roman">Pacific Gas
and Electric Company<br />
 (415) 973-7000</font></p>
</td>
<td colspan="2" valign="top">
<p align="center"><font size="3" face="Times New Roman">PG&amp;E
Corporation<br />
 (415) 267-7000</font></p>
</td>
</tr>

<tr>
<td colspan="4" valign="top">
<p align="center"><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
</tr>

<tr>
<td colspan="4" valign="top">
<p align="center"><font size="3" face=
"Times New Roman">(Registrant's telephone number, including area
code)</font></p>
</td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top"></td>
<td valign="top"></td>
<td valign="top"></td>
</tr>
</table>
</div>
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</font>

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<div align="center"><font size="3" face="Times New Roman"></font>
<hr size="2" width="100%" align="center" />
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<font size="3" face="Times New Roman"><br clear="all" />
</font>

<p><font size="3" face="Times New Roman">Item 5.&nbsp;&nbsp;Other
Events and Regulation FD Disclosure</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face="Times New Roman">California Public
Utilities Commission (CPUC) Holding Company Conditions</font></p>

<p><b><i><font size="3" face="Times New Roman"></font></i></b></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
May 21, 2004, the California Court of Appeal for the First
Appellate District in San Francisco issued an opinion finding that
(1) the CPUC has limited jurisdiction over the parent holding
companies of the California investor-owned electric utilities to
enforce various conditions imposed by the CPUC when the CPUC
authorized the formation of the holding companies, and (2) the
CPUC&rsquo;s interim opinion (adopted on January 9, 2002, after the
formation of the holding companies) interpreting one of these
conditions, the capital requirements condition, was not ripe for
review by the appellate court.</font> <font size="3" face=
"Times">&nbsp; The court said that since the CPUC had not yet
claimed that any of the holding companies had violated the capital
requirements condition, there was no set of facts before the court
that raised the issue of whether the CPUC's interpretation was
valid.</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
capital requirements condition provides that the capital
requirements of the utility, as determined to be necessary and
prudent to meet the utility&rsquo;s obligation to serve or to
operate the utility in a prudent and efficient manner, must be
given first priority by the parent holding company.&nbsp; On
January 9, 2002, the CPUC decided that the capital requirements
condition, at least under certain circumstances, includes the
requirement that each of the holding companies &ldquo;infuse the
utility with all types of capital necessary for the utility to
fulfill its obligation to serve.&rdquo;&nbsp; The three major
California investor-owned electric utilities and their parent
holding companies filed petitions for review of this broader
interpretation as being inconsistent with the prior understanding
of that condition as applying only to maintaining a certain level
of capital expenditure or equity investment in the utilities&rsquo;
plant and equipment.&nbsp;</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Also
on January 9, 2002, the CPUC asserted that it maintains
jurisdiction to enforce the conditions against PG&amp;E Corporation
and similar holding companies.&nbsp; Nevertheless, the CPUC
dismissed PG&amp;E Corporation (without prejudice) from its
investigation, initiated in 2001, into whether the California
investor-owned electric utilities, including Pacific Gas and
Electric Company (Utility) have complied with the holding company
conditions, noting that the issue of whether the Utility&rsquo;s
original plan of reorganization under Chapter 11 by which the
Utility proposed to disaggregate its businesses would violate the
CPUC&rsquo;s new interpretation of the capital requirements
condition would be resolved in the &ldquo;appropriate judicial
forums.&rdquo;&nbsp; The next day, on January 10, 2002, the
California Attorney General (AG) filed a complaint against PG&amp;E
Corporation, alleging, among other claims, that the Utility&rsquo;s
original plan of reorganization and past transfers of money from
the Utility to PG&amp;E Corporation, and allegedly from PG&amp;E
Corporation to other affiliates of PG&amp;E Corporation, violated
various conditions, including the capital requirements condition as
interpreted by the CPUC the day before.&nbsp; Similar complaints
were filed against PG&amp;E Corporation by the City and County of
San Francisco (CCSF) and a private plaintiff.</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Among
other requests, the AG seeks civil penalties of $2,500 per
violation against each defendant for a total penalty of not less
than $500 million and restitution of assets allegedly wrongfully
transferred to PG&amp;E Corporation from the Utility.&nbsp; In
October 2003, the U.S. District Court for the Northern District of
California (District Court) found that the AG&rsquo;s and
CCSF&rsquo;s restitution claims belonged to the Utility and were
subject to the bankruptcy court&rsquo;s jurisdiction.&nbsp; The
District Court also determined that the AG&rsquo;s civil penalty
and injunctive relief claims could be resolved in state
court.&nbsp; The AG and CCSF have appealed the District
Court&rsquo;s ruling.</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
connection with the implementation of the Utility&rsquo;s plan of
reorganization on April 12, 2004, the Utility released PG&amp;E
Corporation and its directors from any claims that it might have
had for restitution.&nbsp; The bankruptcy court&rsquo;s order
confirming the plan of reorganization provides that the AG&rsquo;s
claims for civil penalties and injunctive relief were not released
in connection with implementation of the plan.&nbsp; PG&amp;E
Corporation believes that the applicable calculation methodology
for civil penalties, if any violations were found, would not result
in a material adverse effect on its financial condition or results
of operations.&nbsp; In addition, because the CPUC has agreed to
release all claims against PG&amp;E Corporation and the Utility
related to past holding company actions during the energy crisis,
PG&amp;E Corporation believes that the effect of the appellate
court&rsquo;s opinion on the pending CPUC investigation into
actions by the California investor-owned utilities and the other
parent companies during the energy crisis would not result in a
material adverse effect on PG&amp;E Corporation&rsquo;s financial
condition or results of operations.</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Although
PG&amp;E Corporation was dismissed from the CPUC&rsquo;s
investigation, it joined with the two other parent holding
companies in petitioning the appellate court for review of the
CPUC&rsquo;s assertion of jurisdiction over them in the
investigation.&nbsp; Under the December 2003 settlement agreement
entered into among the CPUC, PG&amp;E Corporation, and the Utility
to resolve the Utility&rsquo;s Chapter 11 proceeding, the CPUC
agreed that, once the CPUC approval of the settlement agreement is
no longer subject to appeal, it will release all claims against
PG&amp;E Corporation and the Utility related to past holding
company actions during the California energy
crisis.&nbsp;</font></p>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PG&amp;E
Corporation has forty days in which to determine whether it will
appeal the decision to the California Supreme Court.&nbsp; PG&amp;E
Corporation is unable to predict how the CPUC will seek to enforce
the holding company conditions in the future with respect to
PG&amp;E Corporation and what effect such enforcement will have on
PG&amp;E Corporation&rsquo;s cash flow, results of operations, or
financial condition.</font></p>

<font size="3" face="Times New Roman"><br clear="all" />
</font>

<div align="center">
<table border="0" cellspacing="0" cellpadding="0">
<tr>
<td valign="top">
<p align="center"><font size="3" face=
"Times New Roman">SIGNATURE</font></p>
</td>
</tr>

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<td valign="top"></td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face="Times New Roman">Pursuant to the
requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their
behalf by the undersigned thereunto duly authorized.</font></p>
</td>
</tr>

<tr>
<td valign="top"></td>
</tr>
</table>
</div>

<p><font size="3" face="Times New Roman"></font></p>

<table border="0" cellspacing="0" cellpadding="0">
<tr height="86">
<td height="86" valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td height="86" valign="top">
<p><font size="3" face="Times New Roman">PG&amp;E CORPORATION<br />
 </font></p>
</td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LINDA
Y.H. CHENG</font></p>
</td>
</tr>

<tr height="1">
<td height="1" valign="top"></td>
<td height="1" valign="top" bgcolor="black"></td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Linda Y.H.
Cheng<br />
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporate Secretary</font></p>

<p><font size="3" face="Times New Roman"><br />
 </font></p>
</td>
</tr>

<tr>
<td valign="top"></td>
<td valign="top"></td>
</tr>

<tr>
<td valign="top"></td>
<td valign="top"></td>
</tr>

<tr height="30">
<td height="30" valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td height="30" valign="top">
<p><font size="3" face="Times New Roman">PACIFIC GAS AND ELECTRIC
COMPANY<br />
<br />
 </font></p>

<p><font size="3" face="Times New Roman"></font></p>
</td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;LINDA
Y.H. CHENG</font></p>
</td>
</tr>

<tr height="1">
<td height="1" valign="top"></td>
<td height="1" valign="top" bgcolor="black"></td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
</td>
<td valign="top">
<p><font size="3" face=
"Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Linda
Y.H. Cheng<br />
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Corporate
Secretary</font></p>
</td>
</tr>

<tr>
<td valign="top"></td>
<td valign="top"></td>
</tr>

<tr>
<td valign="top">
<p><font size="3" face="Times New Roman">Dated:&nbsp; May 25,
2004</font></p>
</td>
<td valign="top"></td>
</tr>
</table>

<p><font size="3" face="Times New Roman"></font></p>

<p><font size="3" face="Times New Roman"></font></p>
</div>
</body>
</html>
[{"type": "8-K", "sequence": "1", "filename": "final052504.htm", "description": "FORM 8-K", "secsgml_size_bytes": 19483}]
{"company-data": {"conformed-name": "PACIFIC GAS & ELECTRIC CO", "cik": "0000075488", "assigned-sic": "4931", "irs-number": "940742640", "state-of-incorporation": "CA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-02348", "film-number": "04830608"}, "business-address": {"street1": "77 BEALE ST", "street2": "P O BOX 770000", "city": "SAN FRANCISCO", "state": "CA", "zip": "94177", "phone": "4152677000"}, "mail-address": {"street1": "77 BEALE STREET", "street2": "P O BOX 770000", "city": "SAN FRANCISCO", "state": "CA", "zip": "94177"}}
Form 8-K Dated May 25, 2004
SECURITIES AND EXCHANGE
COMMISSION
Washington,
D.C.  20549
FORM
8-K
CURRENT
REPORT
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of
Report: May 25, 2004
Commission
File
Number
Exact Name
of
Registrant
as specified in
its charter
State or other
Jurisdiction of
Incorporation
IRS Employer
Identification
Number
_____________
_____________
_____________
_____________
1-12609
1-2348
PG&E
Corporation
Pacific Gas
and
Electric Company
California
California
94-3234914
94-0742640
Pacific Gas
and Electric
Company
77 Beale Street, P. O. Box
770000
San Francisco,
California  94177
PG&E
Corporation
One Market, Spear Tower, Suite 2400
San Francisco, California  94105
(Address of
principal executive offices) (Zip Code)
Pacific Gas
and Electric Company
(415) 973-7000
PG&E
Corporation
(415) 267-7000
(Registrant's telephone number, including area
code)
Item 5.  Other
Events and Regulation FD Disclosure
California Public
Utilities Commission (CPUC) Holding Company Conditions
On
May 21, 2004, the California Court of Appeal for the First
Appellate District in San Francisco issued an opinion finding that
(1) the CPUC has limited jurisdiction over the parent holding
companies of the California investor-owned electric utilities to
enforce various conditions imposed by the CPUC when the CPUC
authorized the formation of the holding companies, and (2) the
CPUC's interim opinion (adopted on January 9, 2002, after the
formation of the holding companies) interpreting one of these
conditions, the capital requirements condition, was not ripe for
review by the appellate court.
The court said that since the CPUC had not yet
claimed that any of the holding companies had violated the capital
requirements condition, there was no set of facts before the court
that raised the issue of whether the CPUC's interpretation was
valid.
The
capital requirements condition provides that the capital
requirements of the utility, as determined to be necessary and
prudent to meet the utility's obligation to serve or to
operate the utility in a prudent and efficient manner, must be
given first priority by the parent holding company.  On
January 9, 2002, the CPUC decided that the capital requirements
condition, at least under certain circumstances, includes the
requirement that each of the holding companies "infuse the
utility with all types of capital necessary for the utility to
fulfill its obligation to serve."  The three major
California investor-owned electric utilities and their parent
holding companies filed petitions for review of this broader
interpretation as being inconsistent with the prior understanding
of that condition as applying only to maintaining a certain level
of capital expenditure or equity investment in the utilities'
plant and equipment.
Also
on January 9, 2002, the CPUC asserted that it maintains
jurisdiction to enforce the conditions against PG&E Corporation
and similar holding companies.  Nevertheless, the CPUC
dismissed PG&E Corporation (without prejudice) from its
investigation, initiated in 2001, into whether the California
investor-owned electric utilities, including Pacific Gas and
Electric Company (Utility) have complied with the holding company
conditions, noting that the issue of whether the Utility's
original plan of reorganization under Chapter 11 by which the
Utility proposed to disaggregate its businesses would violate the
CPUC's new interpretation of the capital requirements
condition would be resolved in the "appropriate judicial
forums."  The next day, on January 10, 2002, the
California Attorney General (AG) filed a complaint against PG&E
Corporation, alleging, among other claims, that the Utility's
original plan of reorganization and past transfers of money from
the Utility to PG&E Corporation, and allegedly from PG&E
Corporation to other affiliates of PG&E Corporation, violated
various conditions, including the capital requirements condition as
interpreted by the CPUC the day before.  Similar complaints
were filed against PG&E Corporation by the City and County of
San Francisco (CCSF) and a private plaintiff.
Among
other requests, the AG seeks civil penalties of $2,500 per
violation against each defendant for a total penalty of not less
than $500 million and restitution of assets allegedly wrongfully
transferred to PG&E Corporation from the Utility.  In
October 2003, the U.S. District Court for the Northern District of
California (District Court) found that the AG's and
CCSF's restitution claims belonged to the Utility and were
subject to the bankruptcy court's jurisdiction.  The
District Court also determined that the AG's civil penalty
and injunctive relief claims could be resolved in state
court.  The AG and CCSF have appealed the District
Court's ruling.
In
connection with the implementation of the Utility's plan of
reorganization on April 12, 2004, the Utility released PG&E
Corporation and its directors from any claims that it might have
had for restitution.  The bankruptcy court's order
confirming the plan of reorganization provides that the AG's
claims for civil penalties and injunctive relief were not released
in connection with implementation of the plan.  PG&E
Corporation believes that the applicable calculation methodology
for civil penalties, if any violations were found, would not result
in a material adverse effect on its financial condition or results
of operations.  In addition, because the CPUC has agreed to
release all claims against PG&E Corporation and the Utility
related to past holding company actions during the energy crisis,
PG&E Corporation believes that the effect of the appellate
court's opinion on the pending CPUC investigation into
actions by the California investor-owned utilities and the other
parent companies during the energy crisis would not result in a
material adverse effect on PG&E Corporation's financial
condition or results of operations.
Although
PG&E Corporation was dismissed from the CPUC's
investigation, it joined with the two other parent holding
companies in petitioning the appellate court for review of the
CPUC's assertion of jurisdiction over them in the
investigation.  Under the December 2003 settlement agreement
entered into among the CPUC, PG&E Corporation, and the Utility
to resolve the Utility's Chapter 11 proceeding, the CPUC
agreed that, once the CPUC approval of the settlement agreement is
no longer subject to appeal, it will release all claims against
PG&E Corporation and the Utility related to past holding
company actions during the California energy
crisis.
PG&E
Corporation has forty days in which to determine whether it will
appeal the decision to the California Supreme Court.  PG&E
Corporation is unable to predict how the CPUC will seek to enforce
the holding company conditions in the future with respect to
PG&E Corporation and what effect such enforcement will have on
PG&E Corporation's cash flow, results of operations, or
financial condition.
SIGNATURE
Pursuant to the
requirements of the Securities Exchange Act of 1934, the
registrants have duly caused this report to be signed on their
behalf by the undersigned thereunto duly authorized.
PG&E CORPORATION
LINDA
Y.H. CHENG
Linda Y.H.
Cheng
Corporate Secretary
PACIFIC GAS AND ELECTRIC
COMPANY
LINDA
Y.H. CHENG
Linda
Y.H. Cheng
Corporate
Secretary
Dated:  May 25,
2004