3. PG&E's Petition to Modify D.00-12-064

PG&E requests several modifications to D.00-12-064.⁸ First, PG&E requests authority to issue $4 billion of additional debt to finance its TRA undercollection. PG&E states that its growing TRA undercollection,⁹ which reached $4.5 billion on November 30, 2000, has fully consumed the $1.4 billion of short-term debt that was authorized by D.00-10-065. PG&E estimates that its authority to issue $2 billion of long-term debt under D.00-12-064 will be depleted by March 2, 2001. PG&E believes that its remaining authority under D.00-12-064, together with the $8 billion of additional debt requested by PG&E in its two petitions, will allow PG&E to finance its growing TRA undercollection through December 2001.

Second, PG&E requests authority to finance its TRA undercollection with any of the short-term and long-term debt instruments authorized by D.00-10-065 and D.00-12-064, including debt secured by a lien on PG&E's property, plant, equipment, and other assets. PG&E states that it needs authority to issue different types of debt due to the large size of its TRA undercollection and volatile conditions in the credit markets. For example, PG&E states that there is currently no market for its commercial paper due to uncertainty about PG&E's credit quality. Consequently, in order to find lenders willing to finance its TRA undercollection, PG&E needs flexibility to issue many different types of debt.¹⁰ PG&E states that although it seeks authority to issue various types of debt, the carrying cost of the TRA undercollection for ratemaking purposes should be no higher than the 3-month commercial paper rate.

Third, PG&E requests authority under § 851 to finance it TRA undercollection with debt secured by a lien on its accounts receivable. PG&E states that any such debt will be structured as a true sale for bankruptcy purposes, a sale for financial reporting, and debt for tax purposes. PG&E states that authorizing it to issue secured debt will provide PG&E with additional flexibility to finance its huge TRA undercollection. PG&E also states secured debt may be cheaper than other types of debt.

Finally, PG&E requests that the Commission exclude from PG&E's authorized capital structure¹¹ any debt that PG&E issues to finance its TRA undercollection, including long-term, fixed-rate debt.

PG&E urges the Commission to grant its Petition as soon as possible in order to avoid the possibility of PG&E not having access to sufficient capital to finance its TRA undercollection. So that the Commission may act quickly, PG&E asks the Commission to waive the 30-day period in Rule 47(f) for parties to file responses to PG&E's Petition. PG&E states that the Commission has authority under Rule 47(f) to waive the 30-day period, and that it is appropriate to do so because (1) A.00-10-029 was uncontested, and (2) the urgency of the situation. PG&E also asks the Commission to waive the 30-day period in § 311(g)(1) for public review and comment regarding the Commission's draft decision. PG&E states that the Commission has authority under § 311(g)(2) and Rules 77.7(f) and (g) to waive the 30-day period for public review and comment.