Pacific Gas Transmission Company

First Revised Volume No. 1-A

Effective Date: 06/01/2001, Docket: RP01-400-000, Status: Effective

Fourth Revised Sheet No. 139 Fourth Revised Sheet No. 139 : Effective

Superseding: Substitute Third Revised Sheet No. 139

TRANSPORTATION GENERAL TERMS AND CONDITIONS

(Continued)

36. DISCOUNT POLICY

36.1 PG&E GT-NW may from time to time offer a discount from the maximum

applicable rate for service under any service agreement governed by

this FERC Gas Tariff. If and when PG&E GT-NW offers a discount, such

discount shall first be applied to the GRI Surcharge and last to the

base tariff rate.

36.2 Types Of Discounts

From time to time, PG&E GT-NW and Shipper may agree in writing

on a level of discount of the otherwise applicable rates and

charges in addition to a basic discount from the maximum rates.

For example, PG&E GT-NW may provide a specific discount rate based

on:

1) achievement of a specified quantity levels (including

quantity levels above, below, or equal to a specified level);

2) specified time periods;

3) specified points of receipt, points of delivery, supply areas,

defined geographic areas; or transportation paths; or

4) a specified relationship to the quantities actually

transported (i.e., that the rates shall be adjusted in a

specified relationship to the quantities actually transported).

In all circumstances the discounted rate shall be between the

maximum rate and the minimum rate applicable to the service

provided.