Assigned

Moody’s Investors Service assigned a Baa2 issuer rating toPG&E National Energy Group Inc. (NEG) and confirmed the ratingsof subsidiaries, PG&E Gas Transmission-Northwest (GTN: seniorunsecured debt at Baa1) and PG&E Generating Co. LLC (PG&EGen: bank loan rating of Baa2). PG&E Gen’s rating is removedfrom review for possible downgrade where it was placed on Jan. 29,2001. The ratings of PG&E Gen’s subsidiaries are alsoconfirmed. The rating outlook for NEG and all rated subsidiaries isstable. The Baa2 issuer rating reflects the consolidated strengthof NEG’s business units, including the cash flows and operatingincome from GTN, PG&E Gen, USGenNE, and PG&E EnergyTrading, Moody’s said. Of particular note is the amount of cashflows provided by highly predictable sources, including theregulated cash flows coming from GTN, the dividends sourced by thecontracted portfolio of PG&E Gen and the cash flows expectedfrom the standard offer tariff customers of USGenNE. NEG’s Baa2issuer rating incorporates the legal ring-fencing structureimplemented by PG&E Corp. on Jan. 12 to insulate the creditquality of NEG and its subsidiaries from the effects of any creditdeterioration at PG&E Corp. Specifically, PG&E Corp.established PG&E National Energy Group LLC (NEG LLC) as abankruptcy-remote entity and the direct parent of NEG. PG&ECorporation contributed 100% of the issued and outstanding sharesof NEG to NEG LLC. Specific provisions were established which helpto insulate NEG from the financial condition and the creditors ofits parent company.

After a hard fight over a small project assigned bigsignificance by the contestants, the National Energy Board (NEB)has upheld the doctrine that has ushered pipeline competition intothe Canadian natural-gas community. An NEB panel under boardChairman Ken Vollman approved a new, producer-sponsored bypass ofthe TransCanada-Nova system in Alberta, rejecting pleas for thefederal agency to stop setting precedents favoring new entries intogas transportation.

Duff & Phelps Credit Rating Co. has assigned ratings tosecurities issued by Kelvin Ltd. (Kelvin) that represent thefirst-ever securitization through the capital markets of aportfolio of weather-related risks aggregated by Koch EnergyTrading.

Standard & Poor’s today affirmed the ratings of Duke EnergyCorp. and related entities and assigned a negative rating outlook.