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: March 16, 2001

            Exact Name of
Commission  Registrant        State or other   IRS Employer
File        as specified      Jurisdiction of  Identification
Number      in its charter    Incorporation    Number
----------  --------------    ---------------  --------------

1-12609     PG&E Corporation  California       94-3234914

1-2348      Pacific Gas and   California       94-0742640
            Electric Company

Pacific Gas and Electric Company    PG&E Corporation
77 Beale Street, P.O. Box 770000    One Market, Spear Tower, Suite 2400
San Francisco, California  94177    San Francisco, California 94105

(Address of principal executive offices) (Zip Code)

Pacific Gas and Electric Company    PG&E Corporation
(415) 973-7000                      (415) 267-7000

    (Registrant's telephone number, including area code)

Item 5.  Other Events.

Liquidity and Financial Condition

As of March 15, 2001, Pacific Gas and Electric Company's (Utility) cash
reserves are $2.7 billion, reflecting receipt of a $1.1 billion portion of
a federal income tax refund of $1.2 billion received by PG&E Corporation,
the Utility's parent. Since the Utility's operations showed a loss last
year for tax purposes due to the escalating cost of the Utility's power
purchases in excess of customer revenues for the delivery of that power,
the majority of the refund was returned to the Utility.  The $1.1 billion
paid to the Utility fully reflects the refund the Utility would have
received if it had filed taxes as a "stand alone entity" (i.e., if it had
filed a separate tax return and had not joined in the filing of a
consolidated return with PG&E Corporation).

While the tax refund improved the Utility's cash position, it is not
adequate to cover the Utility's under-collected power purchase costs. If
the Utility were current with all payments to its creditors (including the
$938.5 million balance of its bank loans which the lenders can accelerate
at any time), the cash position would be negative $1.6 billion.

The Utility intends to use a portion of the cash provided by the tax refund
to fund the day-to-day operations of the Utility's gas and electric
distribution and transmission system to help ensure that essential customer
needs are met during the ongoing energy crisis.

Based on a preliminary estimate that is subject to revision, as of January
31, 2001, the Utility's under-collected balance in its Transition Revenue
Account (TRA) (a regulatory balancing account used to track unrecovered
power purchase costs), was approximately $8.3 billion.  Beginning on
January 18, 2001, the California Department of Water Resources (DWR) began
purchasing power for the Utility's customers. To the extent the DWR did not
purchase power, the California Independent System Operator (ISO) continued
to purchase power to maintain the reliability of the electric grid and may
charge the Utility a proportionate share of the ISO's purchases. The
January 31, 2001 TRA balance includes certain costs that the Utility
believes may not be the responsibility of the Utility such as: power
procurement costs incurred by the DWR, estimated ISO charges for power
purchases in those cases where the DWR did not purchase power, and charges
for an allocated portion of defaulted payments owed to the California Power
Exchange by another California investor-owned utility.  Until the treatment
of these costs are clarified the Utility has included them in its estimated
TRA balance. As of February 1, 2001, California Assembly Bill 1X (AB 1X)
authorized the DWR to (1) purchase power to meet the power needs of the
Utility's customers that cannot be met by the Utility's own generation and
power purchased by the Utility under contracts with qualifying facilities
and other generators, and (2) issue revenue bonds to pay for its power
purchases. If the DWR purchases enough power to cover fully the Utility's
"net short" position, the ISO would not continue billing the Utility for
the ISO's emergency power purchases to the same extent  as occurred in
January. The extent to which the Utility's TRA balance may continue to grow
depends on several factors, including how AB 1X is interpreted and
implemented by the DWR and the CPUC, and other legislative and regulatory

With respect to the Utility's commercial paper, the Utility intends,
subject to the continuing uncertainties, to make a first quarter interest
payment on April 2, 2001.  This payment will be for the interest only, from
the original maturity date of each note through March 31, 2001.  Interest
will be calculated at the annual rate of 6.40125 percent, which was the 3-
month LIBOR rate as of December 28. 2001.

The Utility also intends to defer quarterly interest payments on the
Utility's 7.90 percent Deferrable Interest Subordinated Debentures, Series
A, due 2025, until further notice in accordance with the indenture.  The
corresponding quarterly payments on the 7.90 percent Cumulative Quarterly
Income Preferred Securities, Series A, (QUIPS) issued by PG&E Capital I,
due on April 2, 2001, will be similarly deferred. Distributions can be
deferred up to a period of five years per the indenture.  Investors will
accumulate interest on the unpaid distributions at the rate of 7.90

As of March 15, 2001, PG&E Corporation's cash reserves are $300 million,
which includes the remaining balance of the total $1.2 billion tax refund.


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

                              By: CHRISTOPHER P. JOHNS
                                  CHRISTOPHER P. JOHNS
                                  Vice President and Controller

                              PACIFIC GAS AND ELECTRIC COMPANY

                              By: DINYAR B. MISTRY
                                  DINYAR B. MISTRY
                                  Vice President and Controller

Dated: March 16, 2001