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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">UNITED
                  STATES</font></div>
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                  AND EXCHANGE COMMISSION</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Washington,
                  D.C.&#160; 20549</font></div>
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              <td colspan="5" valign="top" width="78%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
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                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">FORM
                  8-K</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">CURRENT
                  REPORT</font></div>
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                </div>
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              <td colspan="5" valign="top" width="78%">
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Pursuant
                  to Section 13 or 15(d) of the Securities Exchange Act of 1934</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
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              <td align="left" colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;</font></div>
              </td>
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            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Date
                  of Report:</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">December
                  20, 2007</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Date
                  of earliest event reported)</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">PG&amp;E
                  CORPORATION</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Exact
                  Name of Registrant as specified in Charter)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">California</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">1-12609</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">94-3234914</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(State
                  or other jurisdiction of incorporation)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Commission
                  File Number)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(IRS
                  Employer</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Identification
                  No.)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="2" valign="top" width="51%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="3" valign="top" width="27%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td colspan="2" valign="top" width="51%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">One
                  Market, Spear Tower, Suite 2400, San
                  Francisco, CA</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="3" valign="top" width="27%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">94105</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="2" valign="top" width="51%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Address
                  of principal executive offices)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="3" valign="top" width="27%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Zip
                  code)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">415-267-7000</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Registrant&#8217;s
                  Telephone Number, Including Area Code)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">N/A</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Former
                  Name or Former Address, if Changed Since Last Report)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">PACIFIC
                  GAS AND ELECTRIC COMPANY</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Exact
                  Name of Registrant as specified in Charter)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">California</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">1-2348</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">94-0742640</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(State
                  or other jurisdiction of incorporation)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Commission
                  File Number)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(IRS
                  Employer</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Identification
                  No.)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td colspan="2" valign="top" width="26%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="2" valign="top" width="26%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td colspan="4" valign="top" width="52%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">77
                  Beale Street, P.O. Box 770000, San Francisco,
                  California</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td valign="top" width="25%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">94177</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="4" valign="top" width="52%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Address
                  of principal executive offices)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
              <td valign="top" width="25%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Zip
                  code)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">(415)
                  973-7000</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Registrant&#8217;s
                  Telephone Number, Including Area Code)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline">N/A</font></font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(Former
                  Name or Former Address, if Changed Since Last Report)</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>
            <tr>
              <td colspan="5" valign="top" width="78%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" colspan="5" valign="top" width="78%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt">
                </div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Check
                  the appropriate box below if the Form 8-K filing is intended to
                  simultaneously satisfy the filing obligation of the registrant
                  under any
                  of the following provisions (see General Instruction A.2. below):</font></div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">[&#160;]</font></div>
              </td>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;&#160;&#160;</font></div>
              </td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Written
                  communications pursuant to Rule 425 under the Securities Act (17
                  CFR
                  230.425)</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">[&#160;]</font></div>
              </td>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Soliciting
                  Material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                  240.14a-12)</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">[&#160;]</font></div>
              </td>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Pre-commencement
                  communications pursuant to Rule 14d-2(b) under the Exchange Act</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(17
                  CFR 240.14d-2(b)</font></div>
              </td>
            </tr>
            <tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">[&#160;]</font></div>
              </td>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Pre-commencement
                  communications pursuant to Rule 13e-4(c) under the Exchange Act</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">(17
                  CFR 240.13e-4(c))</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center">&#160;</div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Item
        8.01.&#160;&#160;Other Events</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">A.&#160;&#160;Long</font><font style="DISPLAY: inline; COLOR: #000000">-</font><font style="DISPLAY: inline; COLOR: #000000">Term
        Procurement Plan</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On
        December 20, 2007, the California
        Public Utilities Commission (CPUC) voted to issue a decision that approves,
        with
        several modifications, the long-term electricity procurement plans (LTPP</font><font style="DISPLAY: inline; COLOR: #000000">s</font><font style="DISPLAY: inline; COLOR: #000000">)
        submitted by the California
        investor-owned electric utilities covering the </font><font style="DISPLAY: inline; COLOR: #000000">10</font><font style="DISPLAY: inline; COLOR: #000000">-year
        period from 2007 through
        2016.&#160;&#160;Each utility is required to submit an LTPP that is designed to
        reduce greenhouse gas emissions and uses the State of California&#8217;s preferred
        loading order to meet forecasted demand; i.e., increases in future demand
        will
        be offset through energy efficiency programs, demand response programs,
        renewable generation resources, distributed generation resources, and finally,
        through new conventional generation.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        CPUC&#8217;s decision forecasts that Pacific Gas and Electric Company (Utility) will
        need to obtain an additional 800 to 1,200 megawatts (MW) of new conventional
        generation by 2015 based on forecasts prepared by the California Energy
        Commission.&#160;&#160;The decision finds that in earlier years (i.e.,<font style="DISPLAY: inline; FONT-STYLE: italic">&#160;</font>2007-2013), the
        Utility
        has a surplus of resources and in 2014 the forecast shows a small need for
        66
        MW.&#160;&#160;The Utility had estimated that it would need to obtain new
        conventional generation of up to 2,300 MW starting in 2011.&#160;&#160;The
        decision notes that if a previously approved contract is terminated before
        the
        generation project is built the Utility will retain the procurement authority
        for the MWs subject to the terminated contract.&#160;&#160;At the end of the
        solicitation or request-for-offer (RFO) process, the Utility must justify
        why
        each bid was selected or rejected.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        decision allows utilities to acquire ownership of new conventional generation
        resources only through turnkey arrangements proposed by third parties in
        the
        utilities&#8217; competitive RFO process.&#160;&#160;The decision prohibits the
        utilities from submitting bids for utility-build generation in their respective
        RFOs until questions can be resolved in the 2008 LTPP proceeding about how
        to
        compare utility-build generation bids with bids from independent power
        producers.&#160;&#160;The decision also permits utility-owned generation
        projects to be proposed through a separate application outside of the RFO
        process in the following circumstances: (1) to mitigate market power
        demonstrated by the utility to be held by others; (2) to support a use of
        preferred resources, such as a renewable energy source; (3) to expand existing
        facilities; (4) to take advantage of a unique and fleeting opportunity (such
        as
        a bankruptcy settlement); and (5) to meet unique reliability needs.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        decision prohibits the utilities from using debt equivalence in evaluating
        bids
        to enter into power purchase agreements from independent power producers,
        although the decision states that the utilities&#8217; cost of capital proceeding may
        still be used to raise concerns regarding the impact of a particular power
        purchase agreement on a utility&#8217;s debt-to-equity ratio.&#160;&#160;Finally, the
        decision eliminates the limitations adopted by the CPUC in 2004 that prohibited
        the utilities from <font style="DISPLAY: inline; COLOR: #000000">recovering
        construction costs in excess of their final bid price from ratepayers but
        required the utilities to share half of any construction cost savings with
        ratepayers while absorbing any cost overruns.&#160;&#160;Instead, the decision
</font>allows the utilities to make flexible proposals for utility-owned
        generation ratemaking on a case-by-case basis.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        CPUC
        decision encourages the utilities to pursue the goal to meet 33% of their
        load
        with renewable resources by 2020, although the decision found that further
        analysis is needed regarding the feasibility and cost of achieving a target
        renewable portfolio standard of 33%.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        utilities are required to submit revised LTPPs reflecting the changes required
        by the CPUC within 90 days of the date the decision is mailed.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">B.&#160;&#160;Energy
        Efficiency</font><font style="DISPLAY: inline; COLOR: #000000">Proceeding</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">On
        December 21, 2007, in response to a petition filed by the California
        investor-owned utilities, a proposed decision was issued recommending the
        modification of the CPUC&#8217;s September 20, 2007 decision establishing incentive
        ratemaking mechanisms for implementation of the utilities&#8217; energy efficiency
        programs<font style="DISPLAY: inline; FONT-STYLE: italic">.</font>&#160;&#160;(The proposed
        decision is available on the CPUC&#8217;s website.)</font></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">&#160;</div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt">2</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">&#160;</div>
        </div>
      </div><br>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Under
        the
        September 20, 2007 decision, before the utilities can earn incentives, the
        utilities must achieve at least 85% of the CPUC&#8217;s overall savings goal over the
        three-year program cycle.&#160;&#160;The proposed decision would grant the
        utilities' request and modify the earlier decision to (i) permit the utilities
        to keep any incentive earnings claimed on an interim basis even if the final
        energy savings are less than 85% of the CPUC's goals for that three-year
        energy
        efficiency program cycle so long as the final energy savings are at least
        65% of
        the CPUC&#8217;s goals, and (ii) confirm that the utilities would not be required to
        pay back any interim earnings under any circumstances unless the final energy
        savings are less than 65% of the CPUC's goals.&#160;&#160;However, the proposed
        decision recommends reducing the amount of the incentives that the utilities
        could claim on an interim basis from 70% of the estimated total for a particular
        three-year program cycle to 50% of the estimated total, subject to verification
        of actual energy savings.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">The
        maximum amount of incentives that the Utility could earn (and the maximum
        amount
        that the Utility could be required to reimburse customers) over the 2006-2008
        program cycle&#160;is $180 million.&#160;&#160;The actual amount and timing of
        the financial impact will depend on the level of energy efficiency savings
        actually achieved over the three-year program cycle and when the applicable
        accounting standard for recognizing incentives or reimbursement obligations
        is
        met.&#160;&#160;If adopted as proposed, the decision should enable the utilities
        to recognize incentives earned, or reimbursement obligations incurred, without
        having to wait until the actual energy savings over the three-year program
        cycle
        are verified.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Comments
        on the proposed decision are due January 10, 2008.&#160;&#160;PG&amp;E
        Corporation and the Utility cannot predict whether the proposed decision
        will be
        adopted.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; COLOR: #000000; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">C.&#160;&#160;Credit
        Ratings</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">On
        December 27, 2007, </font><font style="DISPLAY: inline; COLOR: #000000">Moody's Investors Service</font><font style="DISPLAY: inline; COLOR: #000000">(</font><font style="DISPLAY: inline; COLOR: #000000">Moody's</font><font style="DISPLAY: inline; COLOR: #000000">)
        announced that it had upgraded
        PG&amp;E Corporation&#8217;s and the Utility&#8217;s issuer credit ratings, citing an
        improved regulatory climate in </font><font style="DISPLAY: inline; COLOR: #000000">California</font><font style="DISPLAY: inline; COLOR: #000000">,
        among other
        reasons.&#160;&#160;Moody&#8217;s upgraded PG&amp;E Corporation&#8217;s issuer rating and
        its senior unsecured bank credit facility to Baa1 from Baa3.&#160;&#160;Moody&#8217;s
        upgraded the Utility&#8217;s issuer rating, its senior unsecured bank credit facility,
        and its senior unsecured debt rating to A3 from Baa1.&#160;&#160;Moody&#8217;s also
        upgraded the Utility&#8217;s preferred stock rating to Baa2 from Baa3.&#160;&#160;The
        rating action concludes Moody&#8217;s review initiated in April
        2007.&#160;&#160;Moody&#8217;s outlook for PG&amp;E Corporation and the Utility was
        changed to stable from rating under review.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 11.4pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; COLOR: #000000">As
        previously disclosed, </font>the
        December 2003 settlement agreement entered into among PG&amp;E Corporation, the
        Utility, and the CPUC to resolve the Utility&#8217;s proceeding under Chapter 11 of
        the U.S. Bankruptcy Code requires the CPUC to authorize a minimum <font style="DISPLAY: inline; COLOR: #000000">52% common equity ratio and
        a
</font>minimum return on equity (ROE) for the Utility of 11.22% until the
        Utility receives a credit rating of &#8220;A3&#8221; from Moody&#8217;s or &#8220;A-&#8221; from <font style="DISPLAY: inline; COLOR: #000000">S</font><font style="DISPLAY: inline; COLOR: #000000">tandard
&amp;
</font><font style="DISPLAY: inline; COLOR: #000000">P</font><font style="DISPLAY: inline; COLOR: #000000">oor&#8217;s</font><font style="DISPLAY: inline; COLOR: #000000">&#160;</font><font style="DISPLAY: inline; COLOR: #000000">Rating
        Service</font>.&#160;&#160;<font style="DISPLAY: inline; COLOR: #000000">As a result of Moody&#8217;s action,
        t</font>his requirement has terminated.&#160;&#160;On December 20, 2007, the
        CPUC authorized the Utility to maintain its 52% equity ratio and its 11.35%
        ROE
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        CPUC is expected to issue a</font><font style="DISPLAY: inline; COLOR: #000000"> decision</font><font style="DISPLAY: inline; COLOR: #000000">
        by April 24, 2008</font><font style="DISPLAY: inline; COLOR: #000000">&#160;</font><font style="DISPLAY: inline; COLOR: #000000">addressing
</font><font style="DISPLAY: inline; COLOR: #000000">mecha</font><font style="DISPLAY: inline; COLOR: #000000">nisms
        that could replace the
</font><font style="DISPLAY: inline; COLOR: #000000">utilities</font><font style="DISPLAY: inline; COLOR: #000000">&#8217;</font><font style="DISPLAY: inline; COLOR: #000000">
        future </font><font style="DISPLAY: inline; COLOR: #000000">annual cost of capital
        proceedings.</font></font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 11.4pt"><br></div><br>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; WIDTH: 100%; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
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          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt">3</font></div>
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            <hr style="COLOR: black" noshade size="2">
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 27pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: 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 hereunto
        duly authorized.</font></div>

      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="34%">

              </td>
              <td align="left" valign="bottom" width="1%">

              </td>
              <td align="left" colspan="3" valign="bottom" width="37%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">PG&amp;E
                  CORPORATION</font></div>
              </td>
            </tr>
            <tr>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="2" valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="2" valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Dated:
                  December 27, 2007</font></div>
              </td>
              <td align="left" valign="bottom" width="1%">

              </td>
              <td align="left" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">By:</font></div>
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                  </div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;LINDA
                    Y.H.CHENG</font></div>
                  <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                  </div>
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
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              <td align="left" valign="bottom" width="1%">

              </td>
              <td valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%">

              </td>
              <td align="left" valign="bottom" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;LINDA
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                </div>
              </td>
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      <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%">

            <tr>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="bottom" width="34%">

              </td>
              <td align="left" valign="bottom" width="1%">

              </td>
              <td align="left" colspan="3" valign="bottom" width="37%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">PACIFIC
                  GAS AND ELECTRIC COMPANY</font></div>
              </td>
            </tr>
            <tr>
              <td valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="2" valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
              <td colspan="2" valign="middle" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;</font></td>
            </tr>
            <tr>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">Dated:
                  December 27, 2007</font></div>
              </td>
              <td align="left" valign="bottom" width="1%">

              </td>
              <td align="left" valign="top" width="3%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">By:</font></div>
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                    Y.H.CHENG</font></div>
                  <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                  </div>
                </div>
                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
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              <td align="left" valign="bottom" width="1%">

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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;LINDA
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 13.7pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 12pt; FONT-FAMILY: Times New Roman">&#160;Vice
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                <div style="DISPLAY: block; TEXT-INDENT: 0pt; LINE-HEIGHT: 0pt">
                </div>
              </td>
            </tr>

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form8k122707.htm
UNITED
                  STATES
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:
December
                  20, 2007
(Date
                  of earliest event reported)
PG&E
                  CORPORATION
(Exact
                  Name of Registrant as specified in Charter)
California
1-12609
94-3234914
(State
                  or other jurisdiction of incorporation)
(Commission
                  File Number)
(IRS
                  Employer
Identification
                  No.)
One
                  Market, Spear Tower, Suite 2400, San
                  Francisco, CA
94105
(Address
                  of principal executive offices)
(Zip
                  code)
415-267-7000
(Registrant's
                  Telephone Number, Including Area Code)
N/A
(Former
                  Name or Former Address, if Changed Since Last Report)
PACIFIC
                  GAS AND ELECTRIC COMPANY
(Exact
                  Name of Registrant as specified in Charter)
California
1-2348
94-0742640
(State
                  or other jurisdiction of incorporation)
(Commission
                  File Number)
(IRS
                  Employer
Identification
                  No.)
77
                  Beale Street, P.O. Box 770000, San Francisco,
                  California
94177
(Address
                  of principal executive offices)
(Zip
                  code)
(415)
                  973-7000
(Registrant's
                  Telephone Number, Including Area Code)
N/A
(Former
                  Name or Former Address, if Changed Since Last Report)
Check
                  the appropriate box below if the Form 8-K filing is intended to
                  simultaneously satisfy the filing obligation of the registrant
                  under any
                  of the following provisions (see General Instruction A.2. below):
[ ]
Written
                  communications pursuant to Rule 425 under the Securities Act (17
                  CFR
                  230.425)
[ ]
Soliciting
                  Material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                  240.14a-12)
[ ]
Pre-commencement
                  communications pursuant to Rule 14d-2(b) under the Exchange Act
(17
                  CFR 240.14d-2(b)
[ ]
Pre-commencement
                  communications pursuant to Rule 13e-4(c) under the Exchange Act
(17
                  CFR 240.13e-4(c))
Item
        8.01.  Other Events
A.  Long
-
Term
        Procurement Plan
On
        December 20, 2007, the California
        Public Utilities Commission (CPUC) voted to issue a decision that approves,
        with
        several modifications, the long-term electricity procurement plans (LTPP
s
)
        submitted by the California
        investor-owned electric utilities covering the
10
-year
        period from 2007 through
        2016.  Each utility is required to submit an LTPP that is designed to
        reduce greenhouse gas emissions and uses the State of California's preferred
        loading order to meet forecasted demand; i.e., increases in future demand
        will
        be offset through energy efficiency programs, demand response programs,
        renewable generation resources, distributed generation resources, and finally,
        through new conventional generation.
The
        CPUC's decision forecasts that Pacific Gas and Electric Company (Utility) will
        need to obtain an additional 800 to 1,200 megawatts (MW) of new conventional
        generation by 2015 based on forecasts prepared by the California Energy
        Commission.  The decision finds that in earlier years (i.e.,
2007-2013), the
        Utility
        has a surplus of resources and in 2014 the forecast shows a small need for
        66
        MW.  The Utility had estimated that it would need to obtain new
        conventional generation of up to 2,300 MW starting in 2011.  The
        decision notes that if a previously approved contract is terminated before
        the
        generation project is built the Utility will retain the procurement authority
        for the MWs subject to the terminated contract.  At the end of the
        solicitation or request-for-offer (RFO) process, the Utility must justify
        why
        each bid was selected or rejected.
The
        decision allows utilities to acquire ownership of new conventional generation
        resources only through turnkey arrangements proposed by third parties in
        the
        utilities' competitive RFO process.  The decision prohibits the
        utilities from submitting bids for utility-build generation in their respective
        RFOs until questions can be resolved in the 2008 LTPP proceeding about how
        to
        compare utility-build generation bids with bids from independent power
        producers.  The decision also permits utility-owned generation
        projects to be proposed through a separate application outside of the RFO
        process in the following circumstances: (1) to mitigate market power
        demonstrated by the utility to be held by others; (2) to support a use of
        preferred resources, such as a renewable energy source; (3) to expand existing
        facilities; (4) to take advantage of a unique and fleeting opportunity (such
        as
        a bankruptcy settlement); and (5) to meet unique reliability needs.
The
        decision prohibits the utilities from using debt equivalence in evaluating
        bids
        to enter into power purchase agreements from independent power producers,
        although the decision states that the utilities' cost of capital proceeding may
        still be used to raise concerns regarding the impact of a particular power
        purchase agreement on a utility's debt-to-equity ratio.  Finally, the
        decision eliminates the limitations adopted by the CPUC in 2004 that prohibited
        the utilities from
recovering
        construction costs in excess of their final bid price from ratepayers but
        required the utilities to share half of any construction cost savings with
        ratepayers while absorbing any cost overruns.  Instead, the decision
allows the utilities to make flexible proposals for utility-owned
        generation ratemaking on a case-by-case basis.
The
        CPUC
        decision encourages the utilities to pursue the goal to meet 33% of their
        load
        with renewable resources by 2020, although the decision found that further
        analysis is needed regarding the feasibility and cost of achieving a target
        renewable portfolio standard of 33%.
The
        utilities are required to submit revised LTPPs reflecting the changes required
        by the CPUC within 90 days of the date the decision is mailed.
B.  Energy
        Efficiency
Proceeding
On
        December 21, 2007, in response to a petition filed by the California
        investor-owned utilities, a proposed decision was issued recommending the
        modification of the CPUC's September 20, 2007 decision establishing incentive
        ratemaking mechanisms for implementation of the utilities' energy efficiency
        programs
.
(The proposed
        decision is available on the CPUC's website.)
2
Under
        the
        September 20, 2007 decision, before the utilities can earn incentives, the
        utilities must achieve at least 85% of the CPUC's overall savings goal over the
        three-year program cycle.  The proposed decision would grant the
        utilities' request and modify the earlier decision to (i) permit the utilities
        to keep any incentive earnings claimed on an interim basis even if the final
        energy savings are less than 85% of the CPUC's goals for that three-year
        energy
        efficiency program cycle so long as the final energy savings are at least
        65% of
        the CPUC's goals, and (ii) confirm that the utilities would not be required to
        pay back any interim earnings under any circumstances unless the final energy
        savings are less than 65% of the CPUC's goals.  However, the proposed
        decision recommends reducing the amount of the incentives that the utilities
        could claim on an interim basis from 70% of the estimated total for a particular
        three-year program cycle to 50% of the estimated total, subject to verification
        of actual energy savings.
The
        maximum amount of incentives that the Utility could earn (and the maximum
        amount
        that the Utility could be required to reimburse customers) over the 2006-2008
        program cycle is $180 million.  The actual amount and timing of
        the financial impact will depend on the level of energy efficiency savings
        actually achieved over the three-year program cycle and when the applicable
        accounting standard for recognizing incentives or reimbursement obligations
        is
        met.  If adopted as proposed, the decision should enable the utilities
        to recognize incentives earned, or reimbursement obligations incurred, without
        having to wait until the actual energy savings over the three-year program
        cycle
        are verified.
Comments
        on the proposed decision are due January 10, 2008.  PG&E
        Corporation and the Utility cannot predict whether the proposed decision
        will be
        adopted.
C.  Credit
        Ratings
On
        December 27, 2007,
Moody's Investors Service
(
Moody's
)
        announced that it had upgraded
        PG&E Corporation's and the Utility's issuer credit ratings, citing an
        improved regulatory climate in
California
,
        among other
        reasons.  Moody's upgraded PG&E Corporation's issuer rating and
        its senior unsecured bank credit facility to Baa1 from Baa3.  Moody's
        upgraded the Utility's issuer rating, its senior unsecured bank credit facility,
        and its senior unsecured debt rating to A3 from Baa1.  Moody's also
        upgraded the Utility's preferred stock rating to Baa2 from Baa3.  The
        rating action concludes Moody's review initiated in April
        2007.  Moody's outlook for PG&E Corporation and the Utility was
        changed to stable from rating under review.
As
        previously disclosed,
the
        December 2003 settlement agreement entered into among PG&E Corporation, the
        Utility, and the CPUC to resolve the Utility's proceeding under Chapter 11 of
        the U.S. Bankruptcy Code requires the CPUC to authorize a minimum
52% common equity ratio and
        a
minimum return on equity (ROE) for the Utility of 11.22% until the
        Utility receives a credit rating of "A3" from Moody's or "A-" from
S
tandard
&
P
oor's
Rating
        Service
.
As a result of Moody's action,
        t
his requirement has terminated.  On December 20, 2007, the
        CPUC authorized the Utility to maintain its 52% equity ratio and its 11.35%
        ROE
        for 2008.
The
CPUC is expected to issue a
decision
by April 24, 2008
addressing
mecha
nisms
        that could replace the
utilities
'
future
annual cost of capital
        proceedings.
3
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 hereunto
        duly authorized.
PG&E
                  CORPORATION
Dated:
                  December 27, 2007
By:
LINDA
                    Y.H.CHENG
LINDA
                  Y.H. CHENG
Vice
                  President, Corporate Governance and Corporate Secretary
PACIFIC
                  GAS AND ELECTRIC COMPANY
Dated:
                  December 27, 2007
By:
LINDA
                    Y.H.CHENG
LINDA
                  Y.H. CHENG
Vice
                  President, Corporate Governance and Corporate Secretary
4