Revenue Cycle Phase 1

To:  ALJ Kim Malcolm and all parties in the consolidated Revenue Cycle
Services Credits Proceeding (Application 97-11-004 et al.)

By this e-mail I am informing you that, contrary to earlier
representations, PG&E will not have the capability to provide credits on
end-use customers' bills on January 1, 1999.

Earlier in this proceeding it was PG&E's good faith belief that the
company could provide credits on end-use customers' bills on January 1
provided that certain critical path billing system issues were decided
by mid-1998.  Unfortunately, late this week PG&E concluded that end-use
customer credits cannot be implemented before late summer 1999.  The
problem is not in calculating the credit amount due to each customer
each month beginning January 1999, but rather in having the credit
amount be part of each customer's bill.  This problem exists even if the
credit were to be only one line of the bill format.

I fully understand that this change in PG&E's assessment of its
implementation capability will raise many serious questions and
concerns.  A PG&E billing system expert, case manager Sandy Burns, and I
will be available at the workshop Tuesday morning to discuss this
situation in detail, including possible alternative arrangements for
January 1999.  Then at the prehearing conference Tuesday afternoon we
will seek guidance as to how best to proceed.

Andy Niven
.