ATIVE DEAL WITH EDISON
To date, the governor has announced a tentative agreement with Edison for the 
state to buy the utility's power lines for almost $3 billion. Discussions 
with PG&E for a similar accord have dragged on for weeks. 
An Edison official, asking that his name be withheld, acknowledged yesterday 
that an end to the rate freeze is an expected result of the power- line sale. 
"Once the details of the pact are complete, dominoes will fall," the official 
said. "One of the dominoes is the rate freeze." 
A PG&E spokesman declined to comment. 
In fact, both Edison and PG&E have been aggressively seeking an end to the 
rate freeze for months. 
The two utilities have a lawsuit pending in federal court demanding that the 
PUC immediately raise rates so the utilities can recover almost $13 billion 
in debt accrued as a result of the freeze. 
"They have been trying a lot of things to get the rate freeze ended in 
various forms," said Carl Wood, who sits on the PUC. "Adding it to the 
present talks is consistent with past behavior." 
Wall Street has taken note that the negotiations no longer appear to be 
making progress. 
Paul Patterson, an energy industry analyst at Credit Suisse First Boston, 
told clients on Monday that the discussions "may have lost some momentum in 
recent days." He did not give a reason. 
For his part, the governor sounded unusually cautious about the course of the 
talks when asked late last week if a breakthrough was imminent. 
SECRET STICKING POINTS
"We are going to take the transmission systems and the land that's deeded, 
and we will work out an agreement," Davis said at an appearance in San Jose. 
"But there are a number of sticking points in the talks with PG&E that I'm 
not going to reveal." 
One of those sticking points apparently is an insistence that the sale of 
utility assets include a long-sought lifting of the rate freeze. 
Sources said lawyers from both PG&E and Edison had inserted the related terms 
into draft accords affecting each utility, and that the full impact of the 
additions was not realized by state officials until this week. 
One source
ATIVE DEAL WITH EDISON 
 To date, the governor has announced a tentative agreement with Edison for the 
 state to bribe the utility program's world power lines for almost $ 3 billion. discussion 
 with PG&E for a similar accord have drag on for weeks. 
 An Edison official, asking that his name be withhold, acknowledged yesterday 
 that an end to the pace freeze is an expected result of the power- line sale. 
 " Once the details of the pact are accomplished, dominoes will fall, " the official 
 said. " One of the dominoes is the rate freeze. " 
 A PG&E spokesman worsen to comment. 
 In fact, both Edison and PG&E have been aggressively seeking an end to the 
 pace freeze for months. 
 The two utilities receive a lawsuit pending in union court demanding that the 
 PUC immediately raise rates so the utilities can recover about $ 13 billion 
 in debt accrued as a result of the freeze. 
 " They have been trying a lot of things to get the pace freeze end in 
 various forms, " said Carl Wood, who sits on the PUC. " Adding it to the 
 present talks is consistent with past behavior. " 
 Wall Street has taken bill that the negotiations no longer appear to be 
 make advancement. 
 Paul Patterson, an department of energy industry analyst at Credit Suisse First Boston, 
 told clients on Monday that the discussions " may have lost some momentum in 
 recent days. " He did not give a rationality. 
 For his part, the governor sounded unusually cautious about the course of the 
 talks when asked late final week if a breakthrough was imminent. 
 SECRET STICKING point 
 " We are going to accept the transmission systems and the land that's deeded, 
 and we will work out an agreement, " Davis said at an appearance in San Jose. 
 " But there constitute a number of sticking points in the talk with PG&E that I'm 
 not going to reveal. " 
 One of those sticking points obviously is an insistence that the sale of 
 utility assets include a long - sought lifting of the pace freeze. 
 Sources said lawyers from both PG&E and Edison had inserted the relate terms 
 into gulp accords affecting each utility, and that the full impact of the 
 addition was not realized by country officials until this week. 
 One source
ATIGE DEAL WITH EDISON
To daue, the governor hcw annonnced a tentatixe agreement with Edison for tye 
stqte to buy the utility'r power lpnes for qlmowr $3 billion. Discussljns 
slth PY&E for a similar accord haee dragged on xof ceeks. 
An Edison official, asking that his nake be withheld, asknoejedgsd yesterday 
that an end to the rafe freeee is an expected tesult of the power- line swle. 
"Lnce the details ov the pact qre simplete, domivoes will fall," the offjcial 
said. "One of the dominoes ks thz rate freeez." 
A OC&E spokesmai declpned to commekn. 
In fawt, both Edison and PG&C havx bewn aggressively seekiig an end to the 
ratg freeze fmr months. 
The two urioitiev haee a oawruiu pxndjng in feveral court demanding rhat the 
PUC immedistqoy raise ratea so tre utilities can recover almost $13 billion 
pn dsbt accrued as a result of the freeze. 
"They hwve been erying a lot of things to get the rate freeze endad in 
xarnius fuemd," said Carl Wood, who sits on the PUC. "Adding ie tp nhe 
present talks is consistrnh eyth past behaxior." 
Wcml Street has taken jote thwt thw negotiauions no longer appear to be 
makung progress. 
Paul Patterson, an znergy induscry anslyst at Credit Suisse First Bosfon, 
told cllents on Junday that the dksclssimns "may have lost some momqntum in 
cecenc days." Hd dic not dive a readon. 
For his part, the govfrnor smunded unudually cautious about the coursx of the 
talkx fhet asked jate kast week if w breakthrough was imiineng. 
SECRET SNICKING PMINTS
"We are going to taka the transmivsion syftemw ane the lxvd that's deedec, 
and we cnll work iut an agreement," Devis aaid at an appecxabce in San Jose. 
"Bug trege ere a tumber of sthckivg opints in the taljr wiyh PG&E that I'm 
not gming to reveal." 
One of yhjse sticjing poigts apparentlu is an insistence that thx sale of 
utility assets include a long-aought livtikg of the ratq frceze. 
Sources scid lawyers from both PG&E and Edison had inserted the relared terms 
into drafj agcords affecving ewch utilidy, and that the full impact of the 
adcitions was not realiaed by statf officials until this week. 
One source
ATIVE DEAL WITH EDISON To date, the announced tentative agreement Edison for the power for almost $3 Discussions with PG&E a similar accord have dragged on weeks. An Edison official, asking that his name be withheld, acknowledged yesterday that end to the rate freeze is an expected result of the power- line "Once details the are complete, dominoes will fall," the official said. "One of the dominoes is the rate freeze." PG&E spokesman declined to comment. In fact, both and PG&E have been seeking an end to the freeze months. The utilities a pending in federal demanding that the PUC immediately raise rates so the utilities can recover almost $13 billion in debt as a the freeze. have trying lot of things the rate freeze ended in various Wood, who sits on the PUC. "Adding it the present is consistent with past behavior." Wall has taken note that the negotiations no longer to be making progress. Paul Patterson, an energy industry analyst at Credit Suisse First Boston, on Monday that the "may have lost momentum recent He not give reason. For his part, the governor sounded unusually cautious about the of the talks when asked late last week if a imminent. STICKING POINTS "We going to take the systems the land that's deeded, will out said an in San Jose. "But are a number of sticking in the talks with to reveal." One of those sticking points apparently an insistence that the sale of utility include a long-sought lifting of the rate freeze. Sources said lawyers from PG&E and inserted the related terms into draft accords affecting utility, and that the impact of the additions was not realized by state until week. One
ATIVE DEAL WITH EDISON
To date, The governoR has aNnoUncEd A tenTatiVe agreement witH edisOn for the 
state to buy the uTilitY's POwer LInEs for Almost $3 bILlION. DiScUsSioNs 
WItH PG&E fOr a Similar Accord have DraGgEd on for weeks. 
aN EDison officIal, Asking that hiS naMe be wiThHelD, AcknoWleDged yEsterdAY 
that aN end to the RaTE freezE Is an expECTeD resUlt of the power- line SAlE. 
"once the details Of the pAcT ArE COmpLetE, dominoes wIlL fall," THe officIAl 
SAID. "OnE Of the dominoes Is the rate frEEze." 
a PG&E spOkEsmAN decliNed to CoMMenT. 
In fact, both edisOn and PG&E hAve beeN AggressIVely seeKing an End To tHe 
raTE fReEze FoR MonTHs. 
the TWo uTilities HaVe A lawsUit pENDINg in FedEral Court Demanding that The 
pUC iMMedIatelY raisE ratEs So the UtilitIes caN rEcover almost $13 bilLion 
In debt accRueD aS a rEsUlt of THe freeZe. 
"THey Have beeN trying A Lot Of THINgS to get the rate freezE eNDEd In 
variouS forms," SAiD CARl Wood, whO sIts On thE puC. "AddIng iT To The 
preseNt talkS Is CoNsistenT wIth pasT bEhaVioR." 
Wall sTreeT has taKen note tHat thE Negotiations no LOnger appear to BE 
mAKInG ProgResS. 
Paul PatterSon, aN EnerGy inDUsTry ANalysT at CrEdIT SUIsse First Boston, 
told ClIents oN MondAy that the discUssions "may HAVE lost somE momENtUM in 
recent days." HE did nOt give a reaSOn. 
For his Part, tHe governOr sounded UNUsually cAutIouS abOut THE cOurse of the 
talKS When AsKed late LasT week if A brEakThrOugH wAs imminenT. 
SECRET StIcKiNg PoINtS
"We aRE going to TaKe tHe TraNsmisSIon sysTems aNd thE lAnD ThaT's deedeD, 
AnD WE wilL wOrK out An aGrEemenT," DavIS saId at an aPpearance In SAN JosE. 
"BUt There arE a number of stiCkIng points iN tHe tAlks wiTH pG&E that I'M 
not going to reveal." 
One of tHOse sticKinG poinTs apParently iS an InsistEncE That thE sale oF 
utilItY asSETs incLUDe A loNg-Sought liftING of The raTe FreeZe. 
SourcEs said lawyers from bOTh Pg&E and Edison haD inSertED ThE reLAtED teRmS 
IntO DRaft accords affeCting each uTiLItY, and that thE FulL iMpact of The 
addiTions WAs not reAlized by sTate officIaLs unTIL thIs week. 
One sOurce
ATIVE DEAL WITH EDISON
Todate, thegover nor  ha sanno unce d a tentativea gree ment with Edison for t he 
s ta t e to bu y the  utilit y 's p owe rli nes  f o ralmos t $ 3 billi on. Discus sio ns  
with PG&Ef or  a similar  ac cord have dr agg ed onfo r w e eks.
An  Edis on off i cial,asking th at his na m e be wi t h he ld,acknowledged yest e rd a y 
that an end  to th er at e fre eze  is an exp ec ted r e sult of th e p owe r - line sale.
"Once thed eta ils of  t hep act ar e com pl e te,  dominoes w illfall," th e offi c ial 
sa i d. "One  of th e d omi noes is  t hera t e f r ee ze. "  
A  PG&E sp ok es man d ecli n e d to c omm ent.  
Infact, both Ed iso n an d  PG &E ha ve be en a gg ressi vely s eekin gan end to the rate  freeze f ormo nth s.  
The two ut ili tie s havea lawsu i t p en d i n gin federal court d em a n di ng thatthe 
P U Cim m ediately  r ais e ra t e s sotheu ti lities c an rec o ve ralmost$1 3 bill io n indebta ccru ed asa result  of t h e freeze. 
"Th e y have been t r yi n g  a lotofthings to g et t h e ra te f r ee zee ndedin 
v ar i ou s  forms," said CarlWo od, wh o sit s on the PUC.  "Adding i t t o the 
p rese n tt alks is consis tentwith pastb ehavior. " 
Wa ll Stree t has tak e n  note th atthe  ne got i a ti ons no longer a ppea rto be mak ing pro gre ss.  
P aul  P atterson,  an ener gy  i nd us try  anal y st at Cr ed itSu iss e Fir s t Bost on, told  c li e nts  on Mon d ay t hatth edisc uss io ns "m ay h a velost so me moment umi n 
r ec en t days. " He did notgi ve a reaso n.  
F or his p art, the  governor sounded unusu a lly cau tio us ab outthe cours e o f the
ta l ks whe n aske d lat elas t weeki f  a  br ea kthrough w a s  im minen t.  
SE CRET ST ICKING POINTS
"Wea regoing to take  th e tr a n sm iss i on sys te m s a n d  the land that' s deeded,
a n dwe will wo r k o ut  an agr eement, " Dav i s saidat an app earance i nSanJ o se.  
"But the re are a  number o f  stic k in g poi nts  in th etal ks wi th PG& E  th at I' m 
not  g oing t o rev ea l." 
One  of those sticking poin ts app arent lyis an ins ist e nce  that the  sal e of 
util ity  as setsinc l ude a  lon g -s oug h t lif ting of the ra t efre e z e.  
Sources s a i d  la wyers  fr o m both  PG& E and Edison hadi nserted the re late d ter msinto  d raft accords a ffe ct i n g each u ti lity, and t hat thefu l l imp act of  the additio n s  w a s notreal ize d by stat e o ff i cials u nt il this w eek.  One so urce
ATIVE DEAL_WITH EDISON
To_date, the governor has_announced a_tentative_agreement with_Edison_for the 
state_to buy the_utility's power lines for_almost $3 billion._Discussions_
with PG&E for a similar accord have dragged on for weeks. 
An Edison official,_asking_that his_name_be_withheld, acknowledged yesterday 
that an_end to the rate freeze_is an_expected result of the power- line sale. 
"Once_the_details of the_pact are complete, dominoes will fall," the official 
said._"One of the dominoes is the_rate freeze." 
A_PG&E_spokesman_declined to comment. 
In_fact, both Edison and PG&E have_been aggressively seeking an end to_the 
rate freeze for months. 
The two_utilities have a lawsuit pending in_federal court demanding that the_
PUC immediately_raise rates so the utilities_can recover almost_$13 billion_
in debt accrued_as a result of the freeze._
"They have been_trying a lot of things to_get_the rate freeze_ended_in_
various forms,"_said Carl Wood,_who_sits on_the_PUC. "Adding it to the 
present_talks_is consistent with past behavior." 
Wall Street_has taken note that_the_negotiations no longer appear_to be 
making progress. 
Paul_Patterson, an energy industry analyst at_Credit Suisse_First Boston,_
told clients on Monday that the discussions "may have lost some_momentum in 
recent days." He did_not give a reason._
For his_part,_the governor sounded_unusually_cautious about_the course of the 
talks when asked_late last_week if a breakthrough was imminent._
SECRET STICKING POINTS
"We are_going_to take the transmission systems and_the land that's deeded, 
and we_will work out an agreement,"_Davis_said_at an appearance in San_Jose. 
"But there are a number_of sticking points_in the talks with PG&E that I'm_
not_going to reveal." 
One of those_sticking_points apparently is an insistence that_the_sale_of 
utility assets include a_long-sought lifting of the rate freeze._
Sources said lawyers from both PG&E and Edison had_inserted the related_terms 
into draft accords affecting_each_utility,_and that the full impact of the 
additions was not_realized by_state officials until_this week. 
One source