BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION


 Petition of     )
       )
 PUGET SOUND ENERGY, INC.  ) DOCKET UG-010806
       )
 For an Order Granting an Extension of  ) ORDER MODIFYING
 The Termination Date of the Purchased Gas ) ACCOUNTING ORDER
 Incentive Mechanism    ) IN DOCKET UG-980833
 …………………………………………...… )

1 On May 30, 2001, Puget Sound Energy, Inc. (“Petitioner” or “Company”), filed 
a petition for an order   regarding the short-term extension of accounting and 
ratemaking treatment of the Company’s purchased gas  adjustment (“PGA”) 
incentive mechanism.  The Order approving the Company’s existing PGA incentive 
filing  in Docket UG-980833 included a sunset date of June 30, 2001.  The 
Company is seeking a short-term  extension of the sunset date until October 31, 
2001, and a modification to the mechanism, while the Company  seeks to develop 
longer-term revisions to its PGA incentive for the Commission’s consideration.

2 On June 21, 2001, PSE submitted substitute tariff pages and a revised 
petition based on an agreement with  Staff,  identifying the criteria necessary 
for granting an extension of the sunset date.

CHANGES IN PGA INCENTIVE MECHANISM ACCOUNTING

3 The Company requested the existing accounting procedure be extended and 
modified.  This included the need  to increase the 2001 proration of the 
existing symmetrical sharing bands from one-half, as established in   
UG-980833, to ten-twelfths consistent with request to extend the mechanism 
through October 31, 2001.   The annual sharing bands established in UG-980833 
are:
  a. An incentive gain or loss in the first band, from $0 to $500,000, is 
shared between ratepayers    and the Company at the ratio of 100%/0%, 
respectively.
  b. The portion of an incentive gain or loss in the second band, from $500,000 
to $27,000,000 is    shared between the ratepayers and the Company at the ratio 
of 60%/40%, respectively.
  c. The portion of an incentive gain or loss in the third band, greater than 
$27,000,000 is shared    between the ratepayers and the Company at the ratio of 
66.7%/33.3%, respectively.

4 All other accounting procedures and regulatory treatment are as described in 
the Order approving the   Company’s current PGA incentive, in Docket UG-980833, 
with the exception of the Fixed Cost Benchmark.   The Fixed Cost Benchmark will 
be decreased by $100,000 per month for the four month extension period.   The 
Fixed Cost Benchmark is decreased to include a greater level of capacity 
release revenues.

FINDINGS

5 Puget Sound Energy, Inc., is engaged in the business of furnishing electric 
and gas service within the state of  Washington as a public service company, 
and is subject to the regulatory authority of the Commission as to its  rates, 
services, facilities and practices.

6 On June 21, 2001, the Company filed a revised petition for an order to 
temporarily extend and modify the  accounting and regulatory treatment of its 
PGA incentive mechanism approved in Docket UG-980833.

7 The temporary continuation of the Company’s existing PGA incentive mechanism 
on a short-term basis is  reasonable.

ORDER

 THE COMMISSION ORDERS:

8 Approval is hereby given for the accounting treatment in the Company’s 
revised petition, dated June 21,  2001, for a temporary extension of the 
Company’s existing PGA incentive mechanism to October 31, 2001,  with the 
prorationing of the symmetrical sharing bands and decrease in the fixed cost 
benchmark.

9 The Commission retains jurisdiction over these matters.

DATED at Olympia, Washington, and effective this 27th day of June, 2001.

WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION




     MARILYN SHOWALTER, Chairwoman



     PATRICK J. OSHIE, Commissioner