ENOVA CORP, DEF 14A, 1998-03-13

ENOVA CORP
DEF 14A, 1998-03-13
ELECTRIC SERVICES

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<PAGE>
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant / /
Filed by a Party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
ENOVA CORPORATION
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/ / No fee required

/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11

(1) Title of each class of securities to which transaction applies:

------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:

------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):

------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:

------------------------------------------------------------------------
(5) Total fee paid:

------------------------------------------------------------------------

/ / Fee paid previously with preliminary materials.

/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:

------------------------------------------------------------------------
(3) Filing Party:

------------------------------------------------------------------------
(4) Date Filed:

------------------------------------------------------------------------

<PAGE>
ENOVA CORPORATION
---------------------------------------------------------------------

DEAR SHAREHOLDER:
--------------------------------------------------------------------------

You are invited to attend the 1998 Annual Meeting of Enova Corporation
shareholders at 10:00 a.m. on Tuesday, April 28, 1998, at the Del Mar
Fairgrounds, 2260 Jimmy Durante Boulevard, Mission Tower Building, Del
Mar, California.

During this meeting, the business of Enova Corporation will be
reviewed. A summary of the meeting will be included in the Spring Report
to Investors, which will be mailed to you in May.

Whether or not you plan to attend the meeting, please fill out, sign
and return your proxy card right away. Your vote is very important.

Sincerely yours,
Stephen L. Baum
Chairman and
Chief Executive Officer

Donald E. Felsinger
President and
Chief Operating Officer
<PAGE>
[MAP INSERTED HERE]
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS OF ENOVA CORPORATION
- ----------------------------------------------------------------------------
ENOVA CORPORATION
- ----------------------------------------------------------------------------
P.O. Box 129400, 101 Ash Street
- ----------------------------------------------------------------------------
San Diego, California 92112-9400
- ----------------------------------------------------------------------------

Tuesday, April 28, 1998
- --------------------------------------------------------------------------------

The Annual Meeting of Shareholders of Enova Corporation will be held on Tuesday,
April 28, 1998, at 10:00 a.m. at the Del Mar Fairgrounds, 2260 Jimmy Durante
Boulevard, Mission Tower Building, Del Mar, California, to:

1. Elect the three directors constituting Class III of Enova Corporation's
board of directors to serve a three-year term--the names of the three
nominees intended to be presented for election are William D. Jones, Ralph
R. Ocampo, M.D. and Thomas C. Stickel; and

2. Act upon such other business as may properly come before the meeting.

The Enova Corporation board of directors has fixed the close of business on
March 2, 1998 as the record date for the determination of shareholders entitled
to notice of and to vote at the meeting and any adjournment or postponement
thereof. It is anticipated that the proxy material will be mailed to
shareholders on or about the date of this notice.

San Diego, California
By order of the Board of
Directors
March 13, 1998
Stephen L. Baum
Chairman and
Chief Executive Officer
- --------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT! Please sign and return your enclosed proxy promptly,
even if you expect to attend the meeting. A business-reply envelope is enclosed
for your convenience in returning the proxy. It requires no postage if mailed
within the United States. Ample free parking will be available at the Del Mar
Fairgrounds.
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT
TUESDAY, APRIL 28, 1998

<TABLE>
<CAPTION>
CONTENTS PAGE
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<S> <C>
Chairman's and President's Letter

Notice of Annual Meeting

Proxy Statement............................................................................................ 1

Introduction............................................................................................. 1

Meeting Date, Voting, Proxies............................................................................ 1

Election of Directors of Enova........................................................................... 2

Nominees............................................................................................... 4

Board Meetings/Committees.............................................................................. 5

Security Ownership of Management and Certain Beneficial Holders........................................ 6

Executive Compensation and Transactions with Management and Others..................................... 8

Relationship with Independent Public Accountants......................................................... 25

Annual Report and Availability of Form 10-K.............................................................. 25

Shareholder Proposals for 1999 Annual Meeting............................................................ 25

Proxy Solicitations...................................................................................... 25

Other Business to Be Brought Before the Annual Meeting................................................... 25
</TABLE>
<PAGE>
ENOVA CORPORATION
--------------

PROXY STATEMENT
-------------------

INTRODUCTION

This Proxy Statement is provided to the shareholders of Enova Corporation
(Enova) in connection with its 1998 annual meeting of shareholders, together
with any adjournments or postponements thereof (the Annual Meeting). The Annual
Meeting is scheduled to be held on Tuesday, April 28, 1998 at 10:00 a.m. at the
Del Mar Fairgrounds, 2260 Jimmy Durante Boulevard, Mission Tower Building, Del
Mar, California.

This Proxy Statement and the enclosed proxy were first mailed on or about
March 13, 1998 to shareholders entitled to vote at the Annual Meeting.

Mail to Enova should be addressed to Shareholder Services, P.O. Box 129400,
San Diego, California 92112-9400.

MEETING DATE, VOTING, PROXIES

The board of directors of Enova is soliciting proxies for use at the Annual
Meeting, and a form of proxy is being provided with this Proxy Statement. Any
proxy may be revoked at any time before it is exercised by filing a written
notice of revocation with Enova or by presenting an executed proxy bearing a
later date at or before the Annual Meeting. A shareholder also may revoke a
proxy by attending the Annual Meeting and voting in person. However, attendance
at the Annual Meeting will not in and of itself constitute revocation of a
proxy. All shares represented by valid proxies will be voted as specified in
this Proxy Statement.

The Enova board of directors has fixed the close of business on March 2,
1998 as the record date (the Record Date) for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting. At the close of
business on the Record Date there were 113,606,162 shares of Enova Common Stock,
without par value, outstanding and entitled to vote.

Each share of Enova Common Stock is entitled to one vote on each matter
considered by Enova shareholders.

Shares represented by properly executed proxies received by Enova prior to
or at the Annual Meeting will be voted at the Annual Meeting in accordance with
the instructions specified in such proxies. If no instructions are specified in
a proxy, shares represented thereby will be voted "FOR" the election of the
nominees for directors of Enova, unless authority to vote is withheld as
provided in the proxy. In the event that any other matters properly come before
the Annual Meeting, the holders of proxies solicited by the Enova board of
directors will vote on those matters in accordance with their judgment, and
discretionary authority to do so is included in the enclosed proxy.

Shares represented by proxies in which authority to vote is "WITHHELD" with
respect to any nominee will be counted in the number of votes cast, but will not
be counted as votes for or against the nominee. If a broker or other nominee
holding shares for a beneficial owner does not vote on a nominee, the shares
will not be counted in the number of votes cast.

THE ENOVA BOARD RECOMMENDS THE ELECTION OF ITS NOMINEES FOR DIRECTORS.

1
<PAGE>
ELECTION OF DIRECTORS OF ENOVA

There are presently 10 members on the Enova board. Enova's Restated Articles
of Incorporation divide the board into three approximately equal classes of
directors serving staggered three-year terms, with one class of directors to be
elected at each annual meeting of the shareholders of Enova. Three directors are
to be elected at the Enova Annual Meeting (representing the Class III
Directors). The Enova board has nominated three of the four current members of
Class III of the Enova board to be re-elected. The fourth member, Thomas A.
Page, is not standing for re-election due to his retirement, and the number of
Class III Directors has been reduced accordingly. Directors elected to Class III
of the Enova board will serve a three-year term expiring in 2001.

Should any of the nominees for the Enova board become unavailable (an event
which is not anticipated), and the size of the board is not reduced accordingly,
proxies will be voted for the remainder of the listed nominees and for such
other nominees as may be designated by the Enova board as replacements for those
who become unavailable. The nominees for the Enova board receiving the highest
number of affirmative votes of the shares entitled to vote for such nominees
shall be elected as directors. Votes withheld from any nominee are counted for
purposes of determining the presence or absence of a quorum, but have no other
legal effect under California law.

The Enova board's nominees for reelection at the Enova Annual Meeting as
Class III Directors (with terms expiring in 2001) are W. D. Jones, R. R. Ocampo
and T. C. Stickel. The Enova board Class I Directors (with terms expiring in
1999) are R. C. Atkinson, S. L. Baum, A. Burr and R. A. Collato. The Enova board
Class II Directors (with terms expiring in 2000) are D. W. Derbes and R. H.
Goldsmith.

A brief biography of each nominee for election as a director of Enova, and
each continuing director, is presented below.

CONTINUING MEMBERS OF ENOVA BOARD (CLASS I)
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<TABLE>
<S> <C> <C> <C>
RICHARD C. ATKINSON, PH.D. STEPHEN L. BAUM
Dr. Atkinson is president Mr. Baum has been the
[PHOTO1] of the University of [PHOTO2] chairman of Enova since
California. He served as January 1, 1998, and chief
the chancellor of the executive officer of Enova
University of Cali- and a member of the Enova
fornia at San Diego from board since January 1,
1980 to 1995. He is a 1996. Mr. Baum was a
director of QUALCOMM, Inc. member of the SDG&E board
Before joining UCSD, he from January 1, 1996,
served as director of the through

National Science Foundation. He is a former December 22, 1997. Mr. Baum joined SDG&E as
long-term member of the faculty at Stanford vice president and general counsel in 1985
University. and became senior vice president and general
Age 68 counsel in 1987. He was appointed as an
Director of Enova (Class I) since 1994; executive vice president in January 1993. Mr.
Director of SDG&E since 1992; Member of the Baum is a director of Wright Strategies, Inc.
Audit Committees of Enova and SDG&E. and Pacific Diversified Capital Company
(PDC).
Age 57
Director of Enova (Class I) since January
1996; Director of SDG&E from January 1, 1996,
through December 22, 1997; Chairman of the
Executive and Nominating Committees of Enova.
</TABLE>

2
<PAGE>

<TABLE>
<S> <C> <C> <C>
ANN BURR RICHARD A. COLLATO
Ms. Burr is president of Mr. Collato has been
[PHOTO3] Time Warner Communications [PHOTO4] president and chief
in Rochester, New York. executive officer of the
She was formerly president YMCA of San Diego County
of the San Diego Division since January 1981. He is
of Time Warner Cable, a former director of
which includes Y-Mutual Ltd., a
Southwestern Cable TV and reinsurance company, and
American Cablevision of The Bank of San Diego. He
Coronado. She is a member is a trustee of
Springfield

of the board of trustees of the Rochester College, Jenna Druck Foundation and Bauce
Institute for Technology, the RIT Research Foundation, and is a director of Project
Corporation and George Eastman House. Design Consultants.
Age 51 Age 54
Director of Enova (Class I) since 1994; Director of Enova (Class I) since 1994;
Director of SDG&E since 1993; Member of the Director of SDG&E since 1993; Member of the
Audit and Nominating Committees of Enova and Audit (Chairman), Executive, and Nominating
SDG&E. Committees of Enova and SDG&E.
</TABLE>

CONTINUING MEMBERS OF ENOVA BOARD (CLASS II)
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<TABLE>
<S> <C> <C> <C>
DANIEL W. DERBES ROBERT H. GOLDSMITH Mr.
Mr. Derbes is president of Goldsmith is a management
[PHOTO5] Signal Ventures. From [PHOTO6] consultant. He is a former
November 1985 until chairman, president and
December 31, 1988, he was chief executive officer of
president of Allied-Signal Exten Industries, Inc. and
International Inc. and a former chairman and
executive vice president chief executive officer of
of Allied-Signal Inc., a Rohr, Inc. Mr. Goldsmith
multi- national advanced also is a former vice
techno-

chairman and chief operating officer of
logies company. Mr. Derbes is a director of Precision Forge Co., senior vice president of
Oak Industries, Inc. and WD-40 Co. He also is Pneumo Corporation's Aerospace and Industrial
a member of the board of trustees of the Group and vice president and general manager,
University of San Diego. commercial (aircraft) engine projects
Age 67 division and the gas turbine division, of
Director of Enova (Class II) since 1994; General Electric Company.
Director of SDG&E since 1983 and Age 67
non-executive chairman of SDG&E since January Director of Enova (Class II) since 1994;
1, 1998; Member of the Executive, Executive Director of SDG&E since 1992; Member of the
Compensation and Technology (Chairman) Executive and Finance Committees of Enova and
Committees of Enova. Member of the Executive SDG&E and of the Technology Committee of
(Chairman), Nominating (Chairman) and
Executive Compensation Committees of SDG&E. Enova.
</TABLE>

3
<PAGE>
NOMINEES FOR ELECTION TO ENOVA BOARD (CLASS III)
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<TABLE>
<S> <C> <C> <C>
WILLIAM D. JONES RALPH R. OCAMPO, M.D.
Mr. Jones is president, Dr. Ocampo is a San Diego
[PHOTO7] chief executive officer [PHOTO8] physician and surgeon.
and a director of CityLink Age 66
Investment Corporation. Director of Enova (Class
From 1989 to 1993, he III) since 1994; Director
served as general of SDG&E since 1983;
manager/senior asset Member
manager and investment of the Executive
manager with certain real Compensation Committees of
estate subsidiaries of The Enova and

Prudential. Prior to joining The Prudential, SDG&E and of the Technology Committee
Mr. Jones served as a San Diego City Council of Enova.
member from 1982 to 1987. Mr. Jones is a
director of The Price Real Estate Investment
Trust and a member of the board of trustees
of the University of San Diego.
Age 42
Director of Enova (Class III) and SDG&E since
1994; Member of the Finance (Chairman) and
Nominating Committees of Enova and SDG&E.
THOMAS C. STICKEL
Mr. Stickel is the
[PHOTO9] chairman, chief executive
officer and founder of
University Venture
Network. Mr. Stickel is
the founder of American
Partners Capital Group,
Inc. He previously was the
chairman, chief executive
officer and president of
TCS

Enterprises, Inc. and the Bank of Southern
California, both of which he founded. Mr.
Stickel is a director of Onyx Acceptance
Corporation, Blue Shield of California,
O'Connor R.P.T., Scripps International, Inc.,
Clair Burgener Foundation and the Del Mar
Thoroughbred Club.
Age 48
Director of Enova (Class III) and SDG&E since
1994; Member of the Executive Compensation
(Chairman) and Finance Committees of Enova
and SDG&E and of the Technology Committee
of Enova.
</TABLE>

4
<PAGE>
BOARD MEETINGS/COMMITTEES

During 1997, the SDG&E and Enova Audit Committees met three times, the
Executive Compensation Committees met four times and the Nominating Committees
met twice. The Enova board met fourteen times, while the SDG&E board met eleven
times.

During 1997, all directors attended 75% or more of the aggregate total
meetings of the Enova and SDG&E boards and committees on which they served with
the exception of Dr. Atkinson, who attended 58% of such meetings.

Enova and SDG&E each maintain Audit, Executive, Executive Compensation,
Finance and Nominating Committees. Enova also maintains a Technology Committee.
The major functions of each of the Audit, Executive Compensation and Nominating
Committees are described briefly below.

AUDIT COMMITTEES. In addition to recommending an independent auditor for
each ensuing year, these committees review (1) the overall plan of the annual
independent audits, (2) financial statements, (3) audit results, (4) the scope
of internal audit procedures and (5) the auditors' evaluation of internal
controls. These committees are composed exclusively of directors who are not
salaried employees of Enova or SDG&E.

EXECUTIVE COMPENSATION COMMITTEES. These committees review the salaries and
other forms of compensation of executives of Enova and SDG&E, and make
compensation recommendations to the full boards of directors. These committees
are composed exclusively of directors who are not salaried employees of Enova or
SDG&E.

NOMINATING COMMITTEES. In addition to considering and recommending nominees
to the Enova and SDG&E boards, these committees recommend (1) criteria for board
and committee composition and membership and (2) directors' compensation. These
committees consider any nominees recommended by shareholders by letter to the
respective board. These committees are composed of at least three directors who
are not salaried employees of Enova or SDG&E.

5
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL HOLDERS

The following table presents certain information as of January 31, 1998,
except as otherwise noted, regarding the equity securities of Enova beneficially
owned by (i) the directors, (ii) the executive officers named in the "Summary
Compensation Table" below under "Executive Compensation and Transactions with
Management and Others," (iii) the directors and executive officers of Enova as a
group, and (iv) the only beneficial owners known to Enova to hold more than 5%
of any class of the voting securities of Enova.

<TABLE>
<CAPTION>
AMOUNT AND NATURE
OF BENEFICIAL
OWNERSHIP PERCENT OF
BENEFICIAL OWNER (SHARES)(A) CLASS
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<S> <C> <C>
Directors and Named Executive Officers:
R. C. Atkinson.................................................................... 1,990 *
A. Burr........................................................................... 1,900 *
R. A. Collato..................................................................... 3,388 *
D. W. Derbes...................................................................... 4,790 *
R. H. Goldsmith................................................................... 2,277 *
W. D. Jones....................................................................... 1,445 *
R. R. Ocampo...................................................................... 14,135 *
T. C. Stickel..................................................................... 1,689 *
T. A. Page........................................................................ 230,936 *
S. L. Baum........................................................................ 70,700 *
D. E. Felsinger................................................................... 54,012 *
D. R. Kuzma....................................................................... 16,368 *
E. A. Guiles...................................................................... 19,346 *
All Directors and Executive Officers of Enova and SDG&E as a group
(19 persons)..................................................................... 530,751(B) *
Others:
Franklin Resources, Inc........................................................... 7,926,050(C) 6.98%
777 Mariners Island Boulevard
San Mateo, CA 94404
Union Bank of California Trust Department......................................... 9,195,522(D) 8.09%
530 B Street
San Diego, CA 92101
</TABLE>

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* Less than 1% of the shares outstanding.

6
<PAGE>
(A) All shares are beneficially owned by the directors and named officers, with
sole voting and investment power, except for the following:

- Dr. Atkinson: 1,600 shares held jointly with spouse/children of same
household.

- Mr. Collato: 3,388 shares held jointly with spouse/children of same
household.

- Dr. Ocampo: 14,135 shares held jointly with spouse/children of same
household.

- Mr. Page: 95,417 shares held jointly with or separately by spouse/children of
same household; 46,720 shares of restricted stock granted under the 1986
Long-Term Incentive Plan (LTIP) as to which vesting has not occurred; 57,482
shares credited to an account with the San Diego Gas and Electric Savings
Plan (the Savings Plan) with the trustee.

- Mr. Baum: 67,736 shares held jointly with or separately by spouse/children of
same household (of which 34,150 are shares of restricted stock granted under
the LTIP as to which vesting has not occurred); 2,964 shares credited to a
Savings Plan account with the trustee.

- Mr. Felsinger: 6,754 shares credited to a Savings Plan account with the
trustee; 24,155 shares of restricted stock granted under the LTIP as to which
vesting has not occurred.

- Mr. Kuzma: 1,219 shares credited to a Savings Plan account with the trustee;
10,530 shares of restricted stock granted under the LTIP as to which vesting
has not occurred.

- Mr. Guiles: 2,792 shares credited to a Savings Plan account with the trustee;
8,785 shares of restricted stock granted under the LTIP as to which vesting
has not occurred.

(B) Excludes 25,919 shares delivered to Enova in January 1998, to satisfy
certain withholding tax obligations relating to the vesting of shares
pursuant to the LTIP as described below under "1986 Long-Term Incentive
Plan." All shares are beneficially owned by the directors and officers, with
sole voting and investment power, except for the following:

- 200,926 shares held jointly with or separately by spouses or children living
in the same household.

- 99,440 shares credited to the officers' Savings Plan accounts with the
trustee.

- 161,490 shares of restricted stock granted to officers in 1994, 1995, 1996
and 1997 under the LTIP, as to which restrictions for vesting of shares have
not yet been satisfied.

(C) According to a Schedule 13G/A filed January 29, 1998, the indicated shares
are owned by Franklin Resources, Inc., its subsidiaries and investment
companies advised by such subsidiaries.

(D) 9,139,518 shares are held by the bank in its capacity as trustee under the
Savings Plan. The trustee has discretion under the Savings Plan to vote the
shares in the absence of voting directions by the Savings Plan participants.
The bank also holds 56,004 shares of Enova Common Stock as trustee for
various other trusts.

7
<PAGE>
SECTION 16 REPORTING

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
Enova's directors and officers, and persons who own more than 10% of a
registered class of Enova's equity securities, to file reports of ownership and
changes in ownership of such equity securities with the Securities and Exchange
Commission (the SEC) and the exchange (I.E., the New York or American Stock
Exchanges) upon which such securities are traded. Directors, officers and
greater than 10% shareholders are required by SEC regulations to furnish Enova
with copies of all Section 16(a) forms they file.

Based solely on a review of the copies of such forms furnished to the
company, Enova believes that from January 1, 1997 through December 31, 1997 its
directors, officers and greater than 10% beneficial owners complied with all
Section 16(a) filing requirements.

EXECUTIVE COMPENSATION AND TRANSACTIONS WITH MANAGEMENT AND OTHERS

The following table sets forth information as to all compensation awarded,
paid, earned or distributed by Enova and/or SDG&E during the last three fiscal
years for services in all capacities to or for the benefit of the chief
executive officer and the other four highest compensated executive officers
whose earned compensation exceeded $100,000. Since Enova paid no amounts to any
executives for services as such in 1995, the following table for 1995 presents
information solely for SDG&E. Certain Policies and Guidelines for Affiliated
Company Transactions, which are mandated by the California Public Utilities
Commission and have been adopted by SDG&E and Enova, provide that SDG&E will be
compensated by Enova for personnel and resources which are used by Enova,
including executive resources.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM
------------------------------------- COMPENSATION
OTHER ANNUAL ------------- ALL OTHER
SALARY BONUS COMPENSATION LTIP PAYOUTS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR (A) (B) (C) (D)(E) (F)
- ---------------------------------------------- --------- ---------- ---------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C> <C>
T. A. Page 1997 $ 583,465 $ 592,000 $ 15,761 $ 403,947 $ 122,611
Chairman of Enova and 1996 550,010 429,000 14,076 315,605 169,874
SDG&E 1995 560,577 404,000 12,571 549,205 104,908

S. L. Baum 1997 554,872 509,000 1,776 259,778 130,814
President and Chief 1996 455,489 322,000 1,592 146,940 101,511
Executive Officer of Enova and Vice Chairman 1995 264,423 291,000 1,426 173,661 32,874
of SDG&E

D. E. Felsinger 1997 414,387 364,000 2,979 206,531 47,647
Executive Vice President 1996 356,546 228,000 2,667 129,758 60,534
of Enova and President and Chief Executive 1995 242,885 269,000 2,387 126,580 18,203
Officer of SDG&E

D. R. Kuzma 1997 248,020 133,000 (-) 77,906 44,509
Senior Vice President, 1996 214,673 112,000 (-) 38,414 58,120(G)
Chief Financial Officer and Treasurer of 1995 124,362 118,000 (-) 20,963 37,047(G)
Enova and SDG&E

E. A. Guiles 1997 225,212 152,000 (-) 77,600 31,335
Senior Vice President 1996 201,558 101,000 (-) 57,670 20,910
of Enova 1995 190,773 149,000 (-) 91,127 14,124
</TABLE>

8
<PAGE>
(A) Amounts shown reflect compensation paid and amounts deferred. All officers
may elect to defer bonuses and base salary for periods of time they select.

(B) Bonuses are paid pursuant to the Executive Incentive Compensation Plan
(EICP) as described under "Report of the Executive Compensation Committee"
below.

(D) Restricted stock awarded in 1997 pursuant to the LTIP is reported below in
the Long-Term Incentive Plan Restricted Stock Awards table. LTIP payouts
relate to restrictions lifted on restricted stock awarded pursuant to the
LTIP. Payouts are based on Enova's performance, as described below under
"1986 Long-Term Incentive Plan." The LTIP also provides for the granting of
stock options. In October 1997, Enova rescinded all stock options granted in
October 1996. There were no stock options awarded in 1997 pursuant to the
LTIP and no stock options outstanding as of December 31, 1997.

(E) The aggregate holdings/value of restricted stock held on December 31, 1997,
by the individuals listed in this table, are: T. A. Page, 63,715
shares/$1,649,685; S. L. Baum, 44,915 shares/$1,183,010; D. E. Felsinger,
32,785 shares/$859,083; D. R. Kuzma, 13,760 shares/$358,510; and E. A.
Guiles, 12,045 shares/$311,800. The value of the aggregate restricted stock
holdings at December 31, 1997, is determined by multiplying $26.9375, the
fair market value of Enova's Common Stock on December 31, 1997, less the
purchase price of $2.50 per share for restricted stock purchased in 1993,
1994 and 1995, by the number of shares held. These December 31, 1997 share
amounts include the share amounts shown in "Security Ownership of Management
and Certain Beneficial Holders" above. In certain instances, the January 31,
1998 amounts are less due to the vesting of certain shares in January 1998.
Regular quarterly dividends have been paid on restricted stock held by these
individuals, when declared by Enova.

(F) All other compensation includes a cash amount paid to each officer
designated solely for the purpose of paying (i) the premium for an insurance
policy providing death benefits equal to two times the sum of annual base
pay plus the average of such officer's three highest bonuses; such cash
amount includes a gross-up payment such that the net amount retained by each
officer, after deduction for any income tax imposed on such payment, will be
equal to the gross amount which would have been paid to such officer had the
income tax not been imposed; (ii) a match under deferred compensation
agreements which allows officers who have exceeded the maximum pretax amount
under the Savings Plan to continue to make pretax deferrals of base
compensation to an account in their name up to a maximum of 15%; up to 6% of
base compensation will be matched by a contribution of 50 cents per dollar
deferred; no amount can be deferred by an officer or matched under such
agreement until the officer contributes to the Savings Plan the maximum
amount allowed by the tax law; (iii) SDG&E matching contributions to the
Savings Plan; and (iv) an amount to provide financial and estate planning
services up to a maximum of $10,000 for T. A. Page, S. L. Baum and D. E.
Felsinger, and $7,500 for D. R. Kuzma and E. A. Guiles in 1997 (amounts
received in 1997 may exceed this allowance since each officer was given
until September 1, 1997, to incur expenses in connection with this benefit
for 1996). The respective amounts paid in 1997 for each of the above
officers were: T. A. Page, $82,233, $28,474, $1,904 and $10,000; S. L. Baum,
$91,835, $24,406, $1,945 and $12,628; D. E. Felsinger, $21,498, $14,063,
$1,773 and $10,313; D. R. Kuzma, $34,088, $8,494, $1,927 and $0; and E. A.
Guiles, $9,302, $3,887, $4,000 and $14,146.

(G) Includes the one-time reimbursement of moving expenses in the amounts of
$8,405 in 1995 and $20,295 in 1996.

9
<PAGE>
CERTAIN TRANSACTIONS

In July 1997, SDG&E entered into a three-year procurement agreement with
American Innotek Inc. pursuant to which SDG&E purchased certain field supplies
from American Innotek for $132,000. Mr. Thomas Stickel, a director of SDG&E and
of Enova, is a financial advisor to American Innotek.

COMPENSATION OF DIRECTORS

From January 1, 1997, through June 30, 1997, Enova directors not holding
salaried positions with Enova or SDG&E were paid an annual retainer of $30,000,
payable at the rate of $2,500 per month. Non-employee directors were also
reimbursed for their out-of-pocket expenses incurred to attend meetings during
such period. No additional fees were paid during such period for attendance at
any meeting of the Enova or SDG&E boards or of any committee of such boards. On
July 28, 1997, the Enova and SDG&E boards made certain changes to their
respective non-employee director compensation packages. Pursuant to these
changes, effective July 1, 1997, each non-employee director shall receive an
annual retainer of $25,000 and a per meeting fee of $1,000 for each board and
committee meeting attended, either in person or by teleconference. Joint or
separate meetings of the Enova and SDG&E boards or of the same committee of each
corporation held on one day, as well as concurrent meetings of one or more
committees of either Enova or SDG&E constitute one meeting for the purposes of
calculating the $1,000 fee. Furthermore, each committee chair receives an
additional $1,000 fee for each committee meeting he or she attends either in
person or by teleconference. All payments are made quarterly. All Enova
directors except Messrs. Page and Baum are non-employee directors.

During 1997, SDG&E directors were not paid for their service as such (all
SDG&E directors not holding salaried positions in Enova or SDG&E during 1997
were also Enova directors). All SDG&E board and committee meetings during 1997
were held in conjunction with Enova meetings. Accordingly, the directors
incurred no incremental out-of-pocket expenses in connection with SDG&E meetings
in 1997.

In addition to the annual retainer for service as a director, the LTIP
provides for the grant of up to 300 shares of Enova Common Stock per year to
non-employee directors. This grant was made promptly following the 1995, 1996
and 1997 Annual Meetings to each incumbent non-employee director based upon
service during the prior year, and this grant will continue to be made on the
same terms for future annual meetings, including the Annual Meeting. Although
non-employee directors of Enova and SDG&E are eligible for the annual grant of
300 shares of Enova Common Stock under the LTIP, a director serving on both
boards will receive only one grant of 300 shares annually.

Messrs. Baum, Derbes and Page are directors of Enova and SDG&E who also
served during 1997 as directors of PDC. As a non-employee director, Mr. Derbes
received a $500 fee for attending each meeting of PDC. Mr. Derbes resigned from
PDC's board of directors in December 1997.

Messrs. Baum and Page received no fees or other compensation for serving as
directors of Enova, SDG&E or any of their subsidiaries.

Directors may elect to defer their retainers and/or fees for periods of time
they select.

On December 17, 1990, the board of SDG&E adopted a Retirement Plan for
Directors applicable to directors serving on the board of SDG&E on or after such
date. This Retirement Plan also applies to directors of Enova. If a director has
at least five years of total board service and retires or resigns from the board
in good standing, then beginning on the first day of the calendar quarter
following the later of the director's retirement from the board or attaining age
65, or, if the director dies leaving a surviving spouse before retiring from the
board, beginning on the first day of the calendar quarter following the later of
the date of the director's death or the 65th anniversary of his or her birth,
the director (or a surviving spouse) will receive during each subsequent
12-month period, a benefit amount equal to the director's annual cash
compensation, including the director's annual retainer plus ten times the
per-meeting fee, in effect at the

10
<PAGE>
time of retirement, resignation or death. These benefits shall be paid quarterly
in advance in four equal payments for a benefit period equal to the number of
years of the director's total service on the board. The benefit will end upon
the completion of the benefit period or the death of the later to die of the
director and a surviving spouse, whichever occurs first. In computing the
benefit period, periods of service as an employee director shall be disregarded,
and concurrent service on the boards of SDG&E and Enova will not result in
double-counting of years of service.

EMPLOYMENT CONTRACT OF MR. PAGE

On September 12, 1988, Mr. Page and SDG&E entered into an employment
agreement dated as of June 15, 1988. Mr. Page's employment agreement provides
that he will serve as chief executive officer and chairman of the board of
directors of SDG&E for a period of two years beginning June 15, 1988, subject to
automatic extensions for successive two-year periods (unless the contract is
terminated as described below) and that he will receive a salary at a rate of
not less than $31,916.66 per month or such greater amount as may, from time to
time, be determined by the board. Mr. Page resigned from his position as chief
executive officer effective January 1, 1996, and as chairman of the Enova and
SDG&E boards effective January 1, 1998. Mr. Page continues to serve as an
executive employee and a member of the SDG&E and Enova boards. Mr. Page is not
standing for re-election as a Director of Enova and SDG&E and has announced his
intention to retire as an executive employee of Enova effective April 28, 1998.
Mr. Page's resignations did not and will not trigger a "termination" under the
employment agreement as described below.

The employment agreement also provides that Mr. Page will be entitled to
participation in the EICP, any other annual bonus plan, the Savings Plan, the
LTIP and any other long-term incentive plan. In addition, Mr. Page is entitled
to participate in the Supplemental Executive Retirement Plan (SERP) and the
Pension Plan. Pursuant to an earlier agreement between Mr. Page and SDG&E, Mr.
Page was credited with years of service under the Pension Plan and the SERP
equal to his years of service with SDG&E plus five extra years.

Under the employment agreement, if Mr. Page's employment is terminated (i)
by the board upon two years' written notice, (ii) upon his death or permanent
disability, (iii) by SDG&E for cause or (iv) by Mr. Page upon 30 days written
notice to SDG&E, which termination is other than a "Constructive Termination"
(as defined below), he will receive benefits through the last day of his term of
employment and no additional benefits. If Mr. Page's employment is terminated
(i) because of the dissolution, liquidation or winding-up of SDG&E, (ii) by a
majority vote of the SDG&E board of directors without cause upon 30 days written
notice or (iii) by Mr. Page as a result of (A) any violation of the compensation
provisions of the employment agreement, (B) any adverse and significant change
in Mr. Page's position, duties, responsibilities or status, including the
failure to be elected to the board and as chief executive officer of SDG&E or
(C) a change in Mr. Page's normal business location to a point away from SDG&E's
main headquarters (each, a Constructive Termination), he will be entitled to two
years' salary paid in a lump sum plus a bonus equal to 200% of the average of
the three highest bonuses paid to him during the previous five years, continued
health and life insurance benefits under various plans, his SERP benefit
(without regard to the limit described therein relating to Section 280G of the
Internal Revenue Code of 1986, as amended (the Code)) and his LTIP benefit. If
any of the payments set forth in the previous sentence become subject to the
excise tax imposed by Section 4999 of the Code, SDG&E will pay Mr. Page an
additional amount such that the net amount retained by Mr. Page after deduction
for such excise tax and any income and excise tax imposed on such additional
amount will be equal to the gross amount which would have been paid to Mr. Page
under the agreement had the excise tax not been imposed. The benefits payable to
Mr. Page under the agreement on account of a change in control are in lieu of
any benefits which would have otherwise been payable to Mr. Page under the
Executive Severance Allowance Plan. The term "change in control" includes such
significant events as those described under "Pension Plan and Supplemental
Executive Retirement Plan" below.

11
<PAGE>
EMPLOYMENT CONTRACTS OF MESSRS. BAUM AND FELSINGER

On September 18, 1996, Enova entered into an employment agreement with Mr.
Baum to serve as its President and Chief Executive Officer and SDG&E entered
into an employment agreement with Mr. Donald E. Felsinger to serve as its
President and Chief Executive Officer and as Executive Vice President of Enova.
On December 22, 1997, Enova assumed SDG&E's obligations in connection with Mr.
Felsinger's employment agreement by amending and restating such agreement.
Pursuant to this amended and restated agreement, Mr. Felsinger is to serve as
Enova's President and Chief Operating Officer.

The agreements have an initial two-year term, which automatically will be
extended for a two-year period on September 18, 1998, and on each even-numbered
anniversary thereof, unless terminated in accordance with their terms. During
the term of the agreements, Mr. Baum will receive an annual base salary of not
less than $495,000 and Mr. Felsinger will receive an annual base salary of not
less than $350,000, subject to increases from time to time. In addition, Messrs.
Baum and Felsinger will be entitled to participate in the EICP, the LTIP, the
SERP and other bonus, incentive or deferred compensation and retirement plans
and fringe-benefit programs of Enova and SDG&E, as applicable.

In the event that Mr. Baum's or Mr. Felsinger's employment is involuntarily
terminated on account of the dissolution, liquidation or winding-up of Enova or
SDG&E, as the case may be, or without "cause," or if Messrs. Baum and Felsinger
terminate their employment for "good cause" (as such terms are defined in the
agreements), they will receive: (i) a lump sum payment of two years' base
salary, determined by annualizing their highest monthly base salary paid at any
time during the term, (ii) a bonus equal to 200% of the average of their three
highest annual bonus awards, not necessarily consecutive, paid in the previous
five years, (iii) accelerated vesting and exercisability and/or immediate
removal of all restrictions on any outstanding LTIP award or other long- or
short-term incentive awards, and notwithstanding any conflicting provision in
the applicable incentive plan, each such option or award will remain outstanding
for three years from the date of termination of employment, (iv) continued
health and life insurance benefits and other existing benefit plans for two
years, and (v) two years of additional age and service credit (and for Mr.
Felsinger, if he is not yet age 53, he will be credited with the additional
amount of age credit as if he had attained age 55) under the SERP, without
giving effect to certain early retirement factors therein. Additionally, such
termination will be considered a "qualifying termination" under Mr. Baum's or
Mr. Felsinger's split-dollar life insurance agreement in order to fund their
benefits under the SERP.

The pending business combination of Enova and Pacific Enterprises will not
constitute a "change in control" for purposes of the agreements. However, in the
event that Mr. Baum's or Mr. Felsinger's employment terminates under any of the
foregoing circumstances following the occurrence of another transaction that
would constitute a "change of control" as defined in the LTIP, then, in addition
to the foregoing payments and benefits: (i) each outstanding option or award
will remain outstanding until the expiration of its original term, (ii) health,
life insurance and other benefits will continue until he reaches normal
retirement age and, thereafter, he will be treated as if he had retired at
normal retirement age under the Pension Plan, and (iii) he will receive a lump
sum payment of his benefits under the SERP, less the value of his entitlement
under the Pension Plan, to be paid without regard to the SERP's limitation of
payments on account of the application of Section 280G of the Code. The
agreements also provide for a gross up payment to be made to offset the effects
of any excise tax imposed under Section 4999 of the Code.

12
<PAGE>
CERTAIN ARRANGEMENTS REGARDING DIRECTORS AND MANAGEMENT
RELATING TO THE PENDING BUSINESS COMBINATION WITH PACIFIC ENTERPRISES

BOARD OF DIRECTORS

The business combination of Enova and Pacific Enterprises will create a New
Holding Company which will be known as Sempra Energy. The New Holding Company
Board of Directors will consist of an equal number of directors designated by
each of Pacific Enterprises and Enova. Mr. Baum, Chairman and Chief Executive
Officer of Enova, will serve on the New Holding Company Board, assuming he is
elected by the New Holding Company's shareholders. To date, Enova and Pacific
Enterprises have not decided who, in addition to Mr. Baum and the President and
Chief Operating Officer of Pacific Enterprises, will serve on the New Holding
Company Board after completion of the business combination.

EMPLOYMENT AGREEMENTS

The New Holding Company has entered into employment agreements with Mr. Baum
and Mr. Felsinger that will become effective upon the completion of the business
combination. Each agreement provides for an initial employment term of five
years (subject to earlier mandatory retirement at age 65) with automatic
one-year extensions on the fourth anniversary of the completion of the business
combination (and each anniversary thereafter) unless either party elects not to
extend the term.

Mr. Baum's employment agreement provides that, commencing upon the
completion of the business combination and ending on the earlier of September 1,
2000, or the second anniversary of the completion of the business combination,
he will serve as Vice Chairman of the Board of Directors, President and Chief
Operating Officer of the New Holding Company and as a member of its Office of
the Chairman. During the period, if any, commencing on the second anniversary of
the completion of the business combination and ending on September 1, 2000, Mr.
Baum will be nominated to the position of, and if elected will serve as, Vice
Chairman of the Board, Chief Executive Officer and President of the New Holding
Company. During the period, if any, commencing September 1, 2000, and ending on
expiration of his employment agreement, Mr. Baum will be nominated to the
position of, and if elected will serve as, Chairman, Chief Executive Officer and
President of the New Holding Company.

Under the terms of his agreement, Mr. Baum will receive an annual base
salary of not less than $645,000 during the period in which he serves as
President and Chief Operating Officer of the New Holding Company and thereafter
(during which he will serve as Chief Executive Officer and President of the New
Holding Company) an annual base salary of no less than that of his predecessor
as Chief Executive Officer of the New Holding Company and will be entitled to
participate in (i) annual incentive compensation plans and long-term
compensation plans and awards providing him with the opportunity to earn, on a
year-by-year basis, short-term and long-term compensation at least equal (in
terms of target, maximum and minimum awards expressed as a percentage of annual
base salary) to the greater of his opportunities in effect prior to the
completion of the business combination and awards granted to the Chief Executive
Officer under incentive compensation plans during the period in which he serves
as President and Chief Operating Officer of the New Holding Company and (ii) all
retirement and welfare benefit plans applicable generally to employees and/or
senior executive officer of the New Holding Company.

Mr. Felsinger's employment agreement provides that, commencing on the
completion of the business combination, he will serve as President and the
Principal Executive Officer of the business of the New Holding Company and its
subsidiaries that are not regulated by the California Public Utilities
Commission. In such capacities, Mr. Felsinger will report to the Office of the
Chairman or, if such office no longer exists, the Chief Executive Officer of the
New Holding Company.

13
<PAGE>
As compensation for services, Mr. Felsinger will receive an annual base
salary of not less than $440,000, and will be entitled to participate in (i)
annual incentive compensation plans and long-term compensation plans and awards
providing him with an annual bonus opportunity at least equal (in terms of
target, maximum and minimum awards expressed as a percentage of annual base
salary) to his opportunities in effect prior to the completion of the business
combination and (ii) all retirement and welfare benefit plans applicable
generally to employees and/or senior executive officers of the New Holding
Company.

The employment agreements with Messrs. Baum and Felsinger provide that if
the New Holding Company terminates the executive's employment (other than for
cause, death or disability) or the executive terminates his employment for good
reason, the executive will be entitled to receive an amount equal to (i) the sum
of his annual base salary and annual incentive compensation (equal to the
greater of his target bonus for the year of termination or the average of the
three years' highest gross bonus awards in the five years preceding
termination), multiplied by the number of years remaining in the term of his
agreement, but in no event less than two, provided that in the event of
termination following a change in control such multiplier will be three; (ii) a
pro rata portion of the target amount payable under any annual incentive
compensation awards for the year or, if greater, the average of the three years'
highest gross bonus awards paid to the executive in the five years preceding the
year of termination; and (iii) the present value of the benefits attributable to
additional years of age and service credit for purposes of the calculation of
retirement benefits under the SERP as if he had remained employed for the
remainder of the term of the agreement, but in no event less than two years.

In addition, the employment agreements with Messrs. Baum and Felsinger
provide that (i) all equity-based long-term incentive compensation awards will
immediately vest and become exercisable, provided that any awards granted on or
after the completion of the business combination will remain outstanding and
exercisable until the earlier of the 18 months following termination or the
expiration of the original term of the award; (ii) with respect to all
cash-based long-term incentive compensation awards that are outstanding under
any plan, the New Holding Company will pay the executive a pro rata portion of
all outstanding cash-based, long-term incentive compensation awards at target;
(iii) the executive will be allowed to continue to participate in the New
Holding Company's welfare benefit plans for a period of two years or until he is
eligible for retiree medical benefits, whichever is longer, provided that in the
event of termination following a change in control such period will not be less
than three years; and (iv) the executive will be entitled to payment of any
compensation previously deferred. Each employment agreement also provides that
the executive will not be entitled to receive any benefits that would be subject
to the excise taxes under Section 4999 of the Code PROVIDED, HOWEVER, that the
executive may enter into and receive additional compensation under a
post-termination consulting and non-competition agreement with the New Holding
Company and PROVIDED, that in the event the executive receives a notice from the
Internal Revenue Service to the effect that the amounts payable under the
consulting and non-competition agreement would be subject to the excise tax
imposed under Section 4999 of the Code, the New Holding Company will provide the
executive with an additional payment to offset the effects of such excise tax.

INCENTIVE/RETENTION BONUS AGREEMENTS

The boards of directors of Enova and SDG&E have authorized
incentive/retention bonus agreements with 10 selected executives and officers.
The purpose of the agreements is to (i) compensate covered individuals for the
performance of services related to the business combination, in addition to
their ongoing duties, and (ii) provide an incentive for these individuals to
continue their employment with the New Holding Company. The amount payable under
each agreement is equal to a specified multiple of the participant's base salary
plus annual incentive bonus at target. The multiple is 1.0 or less except for
one individual for whom the multiple is 2.0. Payment of the bonuses is
conditioned upon the completion of the business combination or another business
combination transaction during the term of the agreements. If the business
combination is completed, payment generally will be made if (i) the covered
individual

14
<PAGE>
continues employment with New Holding Company and its subsidiaries for a
specified period of six to twelve months following the completion of the
business combination or (ii) the covered individual's employment is actually or
constructively terminated prior to or following the completion of the business
combination other than for cause. The incentive/retention bonus agreements
provide for the deferral of payment of amounts that would otherwise fail to be
deductible by reason of Section 162(m) of the Code. If the amount of the
foregoing benefits, when taken together with any other payments to a covered
individual, would otherwise fail to be deductible by reason of the "golden
parachute" provisions of Section 280G of the Code, the amount of such benefits
will be reduced to the extent necessary to provide that the net payments will be
so deductible. To the extent any provisions of the agreements would disqualify
the business combination or another business combination transaction for
treatment as a pooling of interests for accounting purposes, such provisions
will be deemed null and void.

The incentive/retention bonus agreements also provide for the deferral,
under a deferred compensation plan, of amounts otherwise payable under the
agreements. The entire amount of the bonuses will be deferred for a period of at
least two years from the completion of the business combination. The entire
bonus amount will be deemed to be invested in the New Holding Company common
stock, with any deemed dividends deemed to be reinvested in additional shares.
One-half of the bonus will be payable two years from the completion of the
business combination. The remaining half will be payable at the later of (i) two
years from the completion of the business combination and (ii) the first date on
which a share of the New Holding Company common stock attains a value that is
10% higher than the value of a share of Enova common stock on October 11, 1996,
the last trading day before the announcement of the business combination, as
adjusted for the business combination. The bonus payments will be made in cash,
based on the value of the New Holding Company common stock on each payment date.
The same terms generally apply to non-officers of Enova, except that the
mandatory deferral period is one year. In addition, participants may select a
deferral period of greater than two years, during which time the amounts
deferred will continue to be deemed invested in the New Holding Company common
stock with dividends reinvested.

The incentive/retention bonus agreements provide for maximum aggregate
incentive/retention bonus payments to all officers of approximately $4.7 million
assuming the business combination is completed. The approximate amounts payable
to the five most highly compensated executive officers of Enova (excluding any
increase or decrease attributable to the deferral of such amounts) are as
follows: Mr. Page, $880,000; Mr. Baum, $1,032,000; Mr. Felsinger, $704,000; Mr.
Kuzma, $736,400; and Mr. Guiles, $316,000.

In addition, the Chief Executive Officer of Enova has been granted the
authority to provide incentive/ retention bonus agreements to other non-officer
employees. The maximum aggregate bonus amounts payable under such agreements are
$5 million.

15
<PAGE>
1986 LONG-TERM INCENTIVE PLAN

The LTIP provides that the Enova Executive Compensation Committee may grant
to certain executives any combination of nonqualified stock options, incentive
stock options, restricted stock, stock appreciation rights, performance awards,
stock payments or dividend equivalents. To date, all outstanding grants made to
executives under the LTIP were in the form of restricted stock.

RESTRICTED STOCK GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
ESTIMATED FUTURE
PAYOUTS
NUMBER OF UNDER NON-STOCK
RESTRICTED PERFORMANCE PERIOD PRICE-BASED
NAME SHARES UNTIL PAYOUT PLANS (A)(B)
- ----------------------------------------------------------- ----------- ----------------------- ----------------
<S> <C> <C> <C>
T. A. Page................................................. 23,300 Four Annual Periods $ 576,675

S. L. Baum................................................. 16,820 Four Annual Periods $ 416,295

D. E. Felsinger............................................ 12,020 Four Annual Periods $ 297,495

D. R. Kuzma................................................ 3,760 Four Annual Periods $ 93,060

E. A. Guiles............................................... 4,180 Four Annual Periods $ 103,455
</TABLE>

(A) The value (target) of the restricted stock awards is determined by
multiplying $24.75, the fair market value of Enova common stock on October
27, 1997, the date of grant, by the number of shares granted.

(B) The payout amounts set forth in this column represent both the maximum and
the target amounts payable upon achievement of all performance-vesting
goals. The minimum payout upon failure to achieve any of the performance
vesting goals would be $0. The actual payout will depend upon the
achievement of performance-vesting goals and upon the fair market value of
Enova common stock at the date of vesting.

With respect to LTIP shares acquired in 1986 through 1992, all restrictions
have been lifted in prior years.

With respect to LTIP restricted shares granted in 1993, 1994, 1995 and 1996,
restrictions on one-quarter of the number of shares originally placed in escrow
were released and the shares were delivered to the executives because SDG&E's
1997 earnings per share (measured in terms of Enova's earnings per share from
and after January 1, 1996) exceeded the earnings per share target set by the
Executive Compensation Committee. All restrictions have now been lifted on LTIP
shares acquired in 1993. With respect to LTIP restricted shares granted in 1997
and all outstanding shares granted in 1994, 1995 and 1996, restrictions on
one-quarter of the number of shares originally placed in escrow are to be
released and shares are to be delivered to the executives for each of the four
succeeding calendar years if the company earns the CPUC-authorized return on
rate base for SDG&E in such succeeding years. If the authorized rate of return
is not met for any performance year-end, those shares would be released and
shares delivered if SDG&E has met or exceeded its authorized return, at the end
of the first, second and third quarters of the following year, for the twelve
months then ending. As to restricted shares granted in 1994, 1995, 1996 and
1997, the restrictions on all remaining shares may be released by the Enova
board of directors after considering the impact on earnings of industry and
corporate restructuring.

16
<PAGE>
adjusted to reflect industry and corporate restructuring. The 1996 and 1997
earnings per share targets were met and restrictions have been lifted on the
1994 and 1995 special grants.

In general, restricted shares may not be sold, transferred or pledged until
restrictions are removed or expire. The LTIP was amended by the Enova board of
directors in July 1996 to authorize holders of restricted shares to transfer
such shares to revocable inter vivos trusts for estate-planning purposes and to
eliminate the $2.50 per share purchase price. Holders of restricted stock have
voting rights and will receive dividends prior to the time the restrictions
lapse if, and to the extent, paid on Enova Common Stock generally.

All shares of restricted stock acquired are placed in escrow. It is
anticipated that restricted stock would be forfeited and would be resold to
Enova at original cost, if any, in the event that vesting is not achieved by
virtue of performance or other criteria. Shares acquired prior to 1996 were
purchased by executives at $2.50 per share.

The LTIP's primary purpose is to enhance the value of Enova to its
shareholders by encouraging executives to remain with Enova and/or SDG&E and to
act and perform to increase the price of Enova shares and Enova earnings per
share, as well as to earn SDG&E's authorized rate of return. The restricted
shares are subject to substantial restrictions on the rights of the executives
to benefit fully from such shares unless and until certain earnings improvement
and/or share value, and continued service requirements, are met. If these
requirements or other criteria are not met, it is anticipated that the
executives' rights to such shares would be forfeited and such shares would be
returned to Enova. These conditions help to align executives' interests with
those of shareholders.

Under the LTIP, all outstanding incentive awards become fully vested and
exercisable without restrictions upon the occurrence of one of two events after
a change in control. The first triggering event is the failure of a successor
corporation or its parent or subsidiary to make adequate provision for
continuation of the LTIP by substituting new awards. In the second triggering
event, even if adequate provision for continuation of the LTIP and substitution
of new awards has been made, an executive's incentive awards will become vested
and exercisable if the executive is terminated within three years after a change
of control for reasons other than cause, retirement, death or disability, or if
the executive voluntarily terminates employment due to adverse circumstances.

The term "change in control" includes such significant events as those
described under "Pension Plan and Supplemental Executive Retirement Plan" below.
The adverse circumstances allowing such voluntary termination of employment
consist of significant and adverse changes in the executive's position, duties,
responsibilities or status, or the reduction or elimination of the executive's
compensation or incentive compensation opportunities.

The LTIP will expire in 2005. Outstanding incentive awards will not be
affected by such expiration or termination and will vest or be forfeited in
accordance with their terms.

17
<PAGE>
PENSION PLAN AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (SERP)

<TABLE>
<CAPTION>
PENSION PLAN AND SERP TABLE AGGREGATE ANNUAL BENEFIT
- -------------------------------------------
FOR CREDITED
YEARS OF SERVICE(A)
-------------------------
ASSUMED 10 YEARS
ANNUAL AND
COMPENSATION 5 YEARS THEREAFTER
- ---------------- ------------- ----------
<S> <C> <C>
$100,000 $ 30,000 $ 60,000
200,000 60,000 120,000
300,000 90,000 180,000
400,000 120,000 240,000
500,000 150,000 300,000
600,000 180,000 360,000
700,000 210,000 420,000
800,000 240,000 480,000
</TABLE>

- ---------

(A) Credited years of service under the Pension Plan for the five highest paid
executive officers are: T. A. Page, 20 years; S. L. Baum, 13 years; D. E.
Felsinger, 25 years; D. R. Kuzma, 3 years; and E. A. Guiles, 25 years.
Amounts shown assume accrual of benefits at 6%; benefits accrue at 5% per
year of service for participants with service beginning after July 1, 1994.

In addition to the Pension Plan, the SERP provides a supplemental retirement
benefit for certain executives. The Pension Plan and the SERP are available for
executives of Enova as well as executives of SDG&E; however, concurrent service
for both Enova and SDG&E will not result in double-counting of years of service.

The aggregate monthly benefit payable under the combined Pension Plan and
SERP to an executive who retires at age 62 or thereafter and has completed at
least five years of service will be a percentage of the executive's final pay
equal to 5% times years of service (up to a maximum of 10 years); however,
officers appointed prior to July 1, 1994, shall receive 6% times years of
service (up to a maximum of 10 years). Final pay is defined in the SERP as the
monthly base pay rate in effect during the month immediately preceding
retirement, plus 1/12 of the average of the highest three years' gross bonus
awards. Alternatively, the executive may elect to receive a lump-sum cash
payment equal to the actuarially determined present value of the monthly
benefits. The SERP also provides reduced benefits to executives who retire
between the ages of 55 and 61, if the executive has completed at least five
years of employee service.

The above table shows the aggregate annual retirement benefits payable to
executives under the Pension Plan and the SERP, assuming a straight life annuity
form of pension at the normal retirement age of 62 for specified compensation
and years of service. The benefit amounts listed in the table are not subject to
a deduction for Social Security benefits. SERP payments will be reduced by
benefits payable under the Pension Plan.

The SERP, as amended, provides monthly surviving-spouse benefits equal to
50% of the defined benefits, and disability benefits equal to 100% of the
defined benefits. The SERP also provides enhanced benefits to an executive who
is adversely affected within three years after the occurrence of an event
constituting a change in control of Enova or SDG&E, as the case may be (a Change
of Control). If, during that period, an executive is terminated for reasons
other than cause, retirement, death or disability, or voluntarily leaves
employment for reasons specified in the SERP, the executive may elect either to
take early retirement, if otherwise qualified to do so, or to receive a lump sum
cash payment equal to the actuarially determined present value of normal
retirement benefits based on 10 years of service.

18
<PAGE>
The lump-sum payment under the SERP may be limited. If that payment alone,
or when added together with other payments that the executive has the right to
receive from Enova or SDG&E, as the case may be, in connection with a Change in
Control, becomes subject to the excise tax imposed by Section 4999 of the Code,
the aggregate payments must be reduced until no such payments are subject to the
excise tax. The effect of this limitation is that total severance payments made
to an executive in connection with a Change in Control may not exceed
approximately 2.99 times the executive's average W-2 income for the five years
preceding the Change of Control.

Certain significant events described in the SERP constitute a Change in
Control, such as the dissolution of Enova or SDG&E, the sale of substantially
all the assets of Enova or SDG&E, a merger or the acquisition by one person or
group of the beneficial ownership of more than 25% of the voting power of Enova
or SDG&E, coupled with the election of a new majority of the board of Enova or
SDG&E, as the case may be. A merger initiated by Enova or SDG&E, in which Enova
or SDG&E, as the case may be, is the surviving entity, is not a change in
control; accordingly, the formation of Enova and the proposed combination with
Pacific Enterprises, including the formation of the New Holding Company, do not
constitute a Change in Control. The adverse actions that allow an executive to
leave employment voluntarily are described in the SERP and consist of events
such as a significant and adverse change in the executive's position, duties,
responsibilities or status, or the reduction or elimination of the executive's
compensation or incentive compensation opportunities.

Some or all of the amounts to be paid which are discussed in the above
paragraphs will be funded out of the cash value of life insurance policies paid
for by the employer on behalf of the executive.

EXECUTIVE SEVERANCE ALLOWANCE PLAN

The Executive Severance Allowance Plan, as amended (the Executive Severance
Plan), covers officers with one or more years of employee service in lieu of
coverage under the severance plan for non-officer employees. The Executive
Severance Plan is available for executives of Enova as well as executives of
SDG&E; however, concurrent service for both Enova and SDG&E will not result in
double-counting of years of service.

The Executive Severance Plan provides two different severance allowances
depending upon whether the officer's termination is related to a Change in
Control. Termination unrelated to a Change in Control essentially means a
termination due to a reduction in staff or a termination resulting from the sale
of a work unit. The term Change in Control includes such significant events as
those described under "Pension Plan and Supplemental Executive Retirement Plan"
above. If, within three years after a Change in Control, the officer is
terminated for reasons other than cause, retirement, death or disability, or
leaves employment voluntarily due to adverse actions, the officer is entitled to
a severance allowance. The adverse actions that allow an officer to leave
employment voluntarily are described in the Executive Severance Plan and consist
of events such as a significant and adverse change in the officer's position,
duties, responsibilities or status, or the reduction or elimination of the
officer's compensation or incentive compensation opportunities.

In the event of a termination unrelated to a Change in Control, officers
with one or more years of employee service, but less than five years of employee
service, will receive a severance allowance consisting of a continuation of base
salary and health and basic life insurance benefits for nine months. Officers
with five or more years of employee service receive a continuation of base
salary and such benefits for 12 months.

19
<PAGE>
The Executive Severance Plan provides that if the length of an officer's
severance allowance is greater under the employees' severance plan than under
the Executive Severance Plan, the officer's severance allowance under the
Executive Severance Plan will be for that longer period.

In the event of a termination related to a Change in Control, the officer
will receive a severance allowance consisting of one year's final pay in a lump
sum payable within five days after termination and, at the officer's option,
either the continuation of health and basic life insurance coverage for 12
months or a lump sum payment equal to the present value of that coverage.
Payments pursuant to the Executive Severance Plan alone, or when combined with
compensation from other Enova or SDG&E sources made in connection with a Change
in Control, may not exceed approximately 2.99 times the officer's average W-2
income for the five years preceding the Change in Control.

The Executive Severance Plan provides a procedure and a formula to reduce
the total payments to be received by an officer by reason of a Change in Control
if such total payments would exceed the 2.99 limitation (causing an excise tax
to be due) and if the officer waives receipt of all or a portion of the excess.

REPORT OF THE EXECUTIVE COMPENSATION COMMITTEE

The Executive Compensation Committee, which is composed entirely of
independent outside directors, acts on behalf of the board of directors in the
interests of the shareholders in formulating policy and administering approved
programs for compensating Enova and SDG&E officers and other senior executives.

The compensation policy, with respect to executives, is to provide a total
compensation package comprising base salary, annual incentive and long-term
incentive, and benefit programs. The terms and administration of the plans by
which such forms of compensation are determined (1) are structured and
administered in the best interests of the shareholders, (2) are reasonable in
comparison to competitive practice, (3) are aligned and vary with corporate
performance, and (4) will continue to motivate and reward on the basis of Enova,
subsidiary and individual performance. The Executive Compensation Committee
believes that a significant portion of the total compensation of all executives,
and most specifically, the chairman, and president and chief executive officers
of Enova and SDG&E, should be "at risk" and based upon the achievement of
measurable, superior financial and operational performance.

In discharging its responsibility, the Executive Compensation Committee,
subject to the final approval of the board of directors, determines the factors
and criteria to be used in compensating the chief executive officers, as well as
other executives of Enova and SDG&E, and applies these factors and criteria in
administering the various plans and programs in which these executives
participate to ensure they are (1) consistent with compensation policy, (2)
compatible with other compensation programs and (3) administered in accordance
with their terms and the objectives for which they are intended.

To assist in the performance of the above and to ensure that it is provided
with unbiased, objective input, the Executive Compensation Committee has elected
to retain the services of an outside independent compensation consulting firm.
The Executive Compensation Committee considers the compensation practices and
levels paid by major nationwide companies. To ensure compensation components and
levels are aligned with Enova's diverse activities, a comprehensive study was
conducted in 1996 by the outside consultant. The study analyzed and compared
Enova compensation practices and levels to those of the nationwide,
multi-industry comparison group including other utility holding companies. The
Executive Compensation Committee believes that by taking into account the
compensation practices of other comparative utility holding companies as well as
major nationwide nonutility companies, it can best determine the level of
compensation necessary to attract, retain and motivate its executives. The
compensation consultant provided 1997 comparative information and made
recommendations to the Executive

20
<PAGE>
Compensation Committee accordingly. In addition, the Executive Compensation
Committee reviews economic and comparative compensation surveys compiled and
provided by the Human Resources Division of SDG&E.

While it may rely on such information, the Executive Compensation Committee
is ultimately and solely responsible for any decisions made or recommended to
the board of directors with regard to the compensation of Enova and SDG&E
executives.

The Executive Compensation Committee has reviewed the compensation of Enova
and SDG&E executives and has determined that their compensation is consistent
with Enova's policies.

CHIEF EXECUTIVE OFFICERS' COMPENSATION

The compensation of Messrs. Page, Baum and Felsinger, as well as that of the
other executives, is directly tied to the achievement of the corporate goals
described below. For 1997, Mr. Page served as chairman of the board of Enova and
SDG&E. Throughout 1997, Mr. Baum served as president and chief executive officer
of Enova and vice chairman of SDG&E and Mr. Felsinger served as president and
chief executive officer of SDG&E and executive vice president of Enova.

The base salary of the chief executive officers, and the other executives,
was targeted at the competitive median (50th percentile) for the above-mentioned
comparison group. For 1997, the targeted participation levels for the chairman
and presidents and chief executive officers were 60% under the Executive
Incentive Compensation Plan (EICP) and 70% under the Long-Term Incentive Plan
(LTIP), of base salary. Actual incentive compensation earned under these two
plans was contingent upon Enova and SDG&E's attaining stated performance goals.
At targeted compensation levels, 57% of the chairman's and presidents' and chief
executive officers' total compensation was contingent on the achievement of
these quantifiable corporate performance goals. As discussed further below in
the EICP and LTIP sections, these goals address Enova earnings per share,
economic value added and market-to-book ratio, and SDG&E operating and
maintenance expenses, capital expenditures, electric-system reliability, safety
and customer satisfaction.

BASE SALARY COMPENSATION

The base-salary component for the chief executive officers and the other
executives is reviewed annually and is based upon the responsibilities of the
position and the experience of the individual. The Executive Compensation
Committee also takes into account the base salaries of executives with similar
responsibilities at the above-mentioned comparison group. Other factors taken
into consideration by the Executive Compensation Committee are the condition of
the local and national economies and the financial and operational health of
Enova and SDG&E. The individual performance of the specific executive is also
considered. The base salary information is gathered and analyzed in order to
determine the appropriate compensation level. While these statistical factors
may warrant one level of pay, more subjective elements such as the condition of
the economy may dictate another.

21
<PAGE>
EXECUTIVE INCENTIVE COMPENSATION PLAN (EICP)

Under the EICP, cash payments may be made annually to the chief executive
officers and other executives based on a combination of financial and operating
performance goals. There are three elements that determine the individual
awards: (1) the executive's base salary, (2) the participation level, and (3)
corporate performance. The participation level is expressed as a percentage of
base salary and is set by the Executive Compensation Committee based on the
executive's duties and level of responsibility. The amount of the individual
award is determined by multiplying the executive's base salary by the
participation level and then modifying it by total corporate performance.

The EICP is highly leveraged on the basis of performance. Accordingly, no
payments may be made unless and until the minimum performance levels are
exceeded. Under the terms of the EICP, corporate performance is measured against
preset quantifiable goals approved by the Executive Compensation Committee at
the beginning of the year. A target and a minimum and maximum performance range
are established for each goal. In 1997, financial goals addressed (1) the
economic value-added and (2) the ratio of Enova's stock market price to its book
value, which is then compared to other utilities. Operating goals addressed (1)
adherence to SDG&E's operating budget and increased revenue enhancements, (2)
capital investments, (3) customer-service satisfaction as measured by customer
surveys, (4) customer electric service reliability as measured in duration and
frequency of outages and (5) employee lost-time accidents. Total corporate
performance is determined from the degree of achievement of each of these goals.
These goals directly support the performance-based-rates goals approved by the
California Public Utilities Commission. The Executive Compensation Committee
gives equal weight to the financial goals and the operating goals in order to
balance shareholder and customer interests. This serves to assist SDG&E in
reaching its twin goals of lowering rates and increasing earnings at the same
time.

The 1997 financial goal of economic value added was exceeded and the
market-to-book ratio is still in the top 25% of utilities. Two of the five
operating target goals were exceeded, namely adherence to operating budget and
revenue enhancements, and capital investments. The other three operating goals'
performance fell below target, namely customer-service satisfaction, electric
system reliability and employee lost-time accidents. For 1997, the individual
awards could not exceed 120% of base salary for the chairman and presidents and
chief executive officers, 80% for other Enova executives and 60% for SDG&E
executives. The EICP compensation component represents 26% of the chairman's and
presidents' and chief executive officers' total mix of compensation based upon
the targets set under the EICP and LTIP. The actual amounts earned by each of
the five highest compensated executives under the EICP are listed in the Summary
Compensation Table.

1986 LONG-TERM INCENTIVE PLAN (LTIP)

The LTIP was approved by the shareholders of SDG&E in 1986, and amended and
reapproved by the shareholders of SDG&E in 1995, to promote the interests of
SDG&E and its shareholders. Enova has assumed the LTIP and the obligation to
issue Enova common stock thereunder. The LTIP delegates the responsibility of
administration and goal determination to the Executive Compensation Committee.
The LTIP's primary purpose is to enhance the value of Enova to its shareholders
by encouraging executives to remain with Enova and/or SDG&E and to act and
perform to increase the price of Enova shares and Enova's earnings per share, as
well as to earn SDG&E's authorized rate of return. The shares represented by the
Restricted Stock are subject to substantial restrictions on the rights of
executives to benefit fully from such shares unless and until certain earnings
improvement and/or share value, and continued service requirements are met. If
these requirements or other criteria are not met, it is anticipated that the
executives' rights to such shares would be forfeited and such shares would be
returned to the Plan.

All Enova and SDG&E executives are eligible to participate in the LTIP at
various levels. The number of shares granted is determined by a formula adopted
by the Executive Compensation Committee, and is calculated as a percentage of
base salary. The higher the responsibility level, the higher the participation

22
<PAGE>
level (or percentage of risk). For example, in 1997 the chairman and presidents
and chief executive officers participated at 70% of base salary, making the LTIP
equal to 30% of the mix of total target compensation. As a component of the
executives' total compensation package, the LTIP formula is reviewed annually.
The review takes into consideration that the value of such shares, at the time
of grant, has been determined to be consistent with the size of grants made to
executives in similar positions in the above-mentioned companies. Other factors
accounted for are LTIP goals, current share ownership and current participation
levels. In 1996, the Executive Compensation Committee established target
share-ownership levels. The executives were given five (5) years to attain and
maintain these levels. The minimum levels are four times base salary for the
chairman and presidents and chief executive officers, two times base salary for
senior vice presidents and one times base salary for vice presidents.

With respect to LTIP restricted shares granted in 1993, 1994, 1995 and 1996,
restrictions on one-quarter of the number of shares originally placed in escrow
were released and the shares were delivered to the executives because SDG&E's
1997 earnings per share (measured in terms of Enova's earnings per share from
and after January 1, 1996) exceeded the earnings per share target set by the
Executive Compensation Committee. With respect to LTIP restricted shares granted
in 1997 and all outstanding shares granted in 1994, 1995 and 1996, restrictions
on one-quarter of the number of shares originally placed in escrow are to be
released and shares are to be delivered to the executives for each of the four
succeeding calendar years if the company earns the CPUC-authorized return on
rate base for SDG&E in such succeeding years. If the authorized rate of return
is not met for any performance year-end, those shares would be released and
shares delivered if SDG&E has met or exceeded its authorized return, at the end
of the first, second and third quarters of the following year, for the twelve
months then ending. As to restricted shares granted in 1994, 1995, 1996 and
1997, the restrictions on all remaining shares may be released by the Enova
board of directors after considering the impact on earnings of industry and
corporate restructuring.

In addition to the above-described restricted shares, special grants of
2,500 shares were made to each of S. L. Baum and D. E. Felsinger in 1994 and
1995. The restrictions on these shares are to be lifted at the end of 1996 and
1997, respectively, if Enova meets or exceeds the target earnings per share for
1996 and 1997 as set by the Executive Compensation Committee at the time of
grant. Such target earnings may be adjusted to reflect industry and corporate
restructuring. The 1996 and 1997 earnings per share targets were met and
restrictions have been lifted on the 1994 and 1995 special grants.

The number of restricted shares granted to Enova and SDG&E's five
highest-compensated executives in 1997, pursuant to the LTIP, is shown in the
Long-Term Incentive Plan Restricted Stock Grants table.

REVENUE RECONCILIATION ACT OF 1993

In 1993, Section 162(m) of the Code was amended to limit the deductibility
of most forms of compensation over $1,000,000 paid to top executives of publicly
held corporations. As a result of the amendments to the LTIP approved by the
shareholders of SDG&E at their 1995 Annual Meeting, the Executive Compensation
Committee believes that awards of stock options and stock appreciation rights
under the LTIP will not be subject to the limitations on compensation
deductibility. The Executive Compensation Committee intends to maintain
flexibility in the manner and conditions under which grants of restricted stock
are made under the LTIP, however, and, in the future, such grants may be subject
to the limitations on compensation deductibility under certain circumstances.

The report is submitted by the Executive Compensation Committee:

Thomas C. Stickel, Chairman
Daniel W. Derbes
Ralph R. Ocampo, M.D.

January 26, 1998

23
<PAGE>
COMPARATIVE COMMON STOCK PERFORMANCE

The following graph compares the percentage change in the cumulative total
shareholder return on Enova Common Stock over the last five fiscal years with
the performances of the Standard & Poor's 500 Index and the Dow Jones Utilities
Index over the same period. The returns were calculated assuming an initial
investment of $100 in Enova Common Stock, the S&P 500, and the Dow Jones
Utilities Index on December 31, 1991, and reinvestment of all dividends. Note
that periods prior to the formation of Enova (January 1, 1996) are measured in
terms of SDG&E Common Stock.

<TABLE>
<CAPTION>
DOW JONES 15
ENOVA S&P 500 INDEX UTILITIES INDEX
--------- --------------- ---------------
<S> <C> <C> <C>
1992 100 100 100
1993 110 110 110
1994 92 112 93
1995 121 153 123
1996 124 189 132
1997 157 252 163
</TABLE>

(A) The Dow Jones Utilities Index (consisting of 11 electric utilities and four
gas utilities) is maintained by Dow Jones & Company, Inc. and reported daily
in The Wall Street Journal.

(B) Calculations for the S&P 500 Index were performed by Standard & Poor's
Compustat Services, Inc.

RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS

Deloitte & Touche LLP has been employed by Enova since its formation and has
been employed by SDG&E for many years to audit financial statements and for
other purposes. Representatives of Deloitte & Touche LLP are expected to be
present at the Annual Meeting. They will have the opportunity to make a
statement, if they so desire, and will respond to appropriate questions from
shareholders.

ANNUAL REPORT AND AVAILABILITY OF FORM 10-K

THE ENOVA 1997 ANNUAL REPORT TO SHAREHOLDERS ACCOMPANIES THIS PROXY
STATEMENT. THE COMBINED ANNUAL REPORT OF ENOVA AND SDG&E TO THE SEC ON FORM 10-K
FOR 1997 WILL BE PROVIDED TO SHAREHOLDERS, WITHOUT CHARGE, UPON WRITTEN REQUEST
TO SHAREHOLDER SERVICES, P.O. BOX 129400, SAN DIEGO, CALIFORNIA, 92112-9400.

SHAREHOLDER PROPOSALS FOR 1999 ANNUAL MEETING

Proposals that Shareholders may wish to have included in the proxy materials
relating to the next Annual Meeting (1999) must be received by Enova by November
13, 1998.

PROXY SOLICITATIONS

In addition to the original solicitation by mail, some of the officers and
employees of Enova and SDG&E may solicit proxies by personal visits, telephone
or mail without receiving compensation in addition to their regular salaries.
Enova anticipates that the expense associated with these solicitation efforts
will be nominal. Enova will reimburse brokerage firms and other securities'
custodians for reasonable expenses incurred by them in forwarding proxy material
to beneficial owners of stock.

Enova and SDG&E have retained Georgeson & Co., Inc., a proxy solicitation
firm, to assist in the dissemination of proxy materials and the solicitation of
proxies at an estimated cost of $12,500 plus disbursements. All costs associated
with these solicitations will be allocated between Enova and SDG&E.

24
<PAGE>
OTHER BUSINESS TO BE BROUGHT BEFORE THE ANNUAL MEETING

The board of directors of Enova does not know of any matters that will be
presented for action at the Annual Meeting other than the matters described
above. However, if any other matters properly come before the Annual Meeting,
the holders of proxies solicited by the Enova board of directors will vote on
those matters in accordance with their judgment, and discretionary authority to
do so is included in the enclosed proxy.

By order of the Board of Directors
Stephen L. Baum
Chairman and
Chief Executive Officer

San Diego, California
March 13, 1998

25
<PAGE>

/X/ Please mark your
votes as in this example

This Proxy when properly executed will be voted in the manner directed herein
by the undersigned shareholder(s).
If no direction is made, this Proxy will be voted FOR Item 1.

The Board of Directors recommends a vote "FOR" the Nominees.

1. ELECTION FOR WITHHELD NOMINEES:
OF CLASS III / / / / WILLIAM D. JONES
DIRECTORS RALPH R. OCAMPO, M.D.
THOMAS C. STICKEL

For, except vote withheld from the following nominee(s):

- ---------------------------------------------------------------------

Check box if you are planning to attend the
Annual Meeting of Enova shareholders. / /

Please check here if you receive more than one
Annual Report and do not wish to receive the
extra copy(ies). This will not affect the distribution
of dividends or proxy statements. / /

Please sign exactly as name appears hereon. Joint owners
should each sign. When signing as attorney, executor, ad-
ministrator, trustee or guardian, please give full title as such.

- ----------------------------------------------------------------

- ----------------------------------------------------------------
SIGNATURE(S) DATE

TRIANGLE FOLD AND DETACH HERE TRIANGLE

ANNUAL MEETING OF SHAREHOLDERS
OF ENOVA CORPORATION

TUESDAY, APRIL 28, 1998
10:00 A.M.

DEL MAR FAIRGROUNDS
SOLANA GATE ENTRANCE
MISSION TOWER BUILDING
DEL MAR, CA
(SEE MAP ON REVERSE SIDE FOR DIRECTIONS)

YOUR VOTE IS IMPORTANT:
PLEASE COMPLETE, DATE AND SIGN YOUR PROXY CARD AND
PROMPTLY RETURN IT IN THE ENCLOSED POSTAGE-PAID ENVELOPE.

[LOGO]

<PAGE>

P PROXY
R THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
O ENOVA CORPORATION
X POST OFFICE BOX 129400, SAN DIEGO, CALIFORNIA 92112-9400
Y
ANNUAL MEETING OF SHAREHOLDERS -- APRIL 28, 1998

STEPHEN L. BAUM, RICHARD A. COLLATO, DANIEL W. DERBES and ROBERT
H. GOLDSMITH, jointly or individually, are hereby appointed as proxies with
full power of substitution to represent and vote all shares of stock of the
undersigned shareholder(s) of record on March 2, 1998, at the Annual
Meeting of Shareholders of Enova Corporation, to be held at Del Mar
Fairgrounds, 2260 Jimmy Durante Blvd., Del Mar, CA, on April 28, 1998,
and at any adjournment or postponement thereof, as indicated on reverse
side.
For Participants in the San Diego Gas & Electric Company Savings Plan
(the "Plan"), the proxy also serves as voting instructions to the Trustee
to vote the shares of Enova Corporation Common Stock beneficially owned by
the Participant in the Plan.

THIS CARD IS ONLY FOR SHARES OF COMMON STOCK

(Continued and to be signed on other side)

SEE REVERSE
SIDE

TRIANGLE FOLD AND DETACH HERE TRIANGLE
DIRECTIONS TO THE DEL MAR FAIRGROUNDS
(SOLANA GATE ENTRANCE, MISSION TOWER BUILDING)

[MAP TO DEL MAR FAIRGROUNDS]