Pacific Gas Transmission Company

First Revised Volume No. 1-A

Effective Date: 02/02/1998, Docket: GT98- 17-000, Status: Effective

First Revised Sheet No. 124 First Revised Sheet No. 124 : Effective

Superseding: Substitute Original Sheet No. 124

TRANSPORTATION GENERAL TERMS AND CONDITIONS

(Continued)

30. GAS SUPPLY RESTRUCTURING TRANSITION COSTS (Continued)

30.3 Applicability of GSR Transition Costs

GSR Transition Costs shall be applicable to all Shippers except

those firm Shippers paying incremental rates on PG&E GT-NW which

are also Supporting Parties to the FERC-approved settlement in

Docket No. RS92-46-000.

30.4 Recovery of Surcharge Amounts

PG&E GT-NW shall recover from each Shipper meeting the appli-

cability criteria defined in Paragraph 30.3 the affected Shipper's

GSR Surcharge amounts and Direct Bill, if applicable, during the

Initial GSR Cost Collection Period and shall continue to recover

such amounts during any applicable Carryover GSR Cost

Collection Period as necessary to complete the full recovery

(but no overrecovery) of PG&E GT-NW's GSR Costs.

30.5 Transition Cost Recovery Mechanism

(a) Absorption -- PG&E GT-NW's shareholder shall absorb 25% of

all Approved GSR Costs.

(b) Direct Bill -- 25% of all Approved GSR Costs will be

recovered by PG&E GT-NW through a Direct Bill. A Direct

Bill will be assessed to PG&E for 100% of the Direct Bill

amount, excluding the amount to be collected from the

Northwest Shippers and credited against the Direct Bill

portion as defined in Paragraph 30.5(d). PG&E may pay

its Direct Bill in a lump sum, plus carrying charges on

the principal amount accrued, in accordance with

Paragraph 30.5(e) until the payment is made. In lieu of

paying the Direct Bill in a lump sum, PG&E may elect one

of three payment schedules. PG&E's Direct Bill amount

and the monthly amount due under each extended payment

option, which shall include carrying charges accrued on

the unpaid balance in accordance with Paragraph 30.5(e),

shall be specified in the Statement of Effective Rates

and Charges of First Revised Volume No. 1-A.

Costs will be recovered by PG&E GT-NW through a volumetric

MMBtu-mile surcharge. The GSR Transition Cost Surcharge

shall include any applicable carrying charges accruing on

the unrecovered balance. The GSR Transition Cost

Surcharge shall be stated in the Statement of Effective

Rates and Charges of PG&E GT-NW's FERC Gas Tariff First

Revised Volume No. 1-A as the same may change from time to

time, depending on PG&E GT-NW's GSR Costs. (Continued)