
<PAGE>

                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549
                                _______________

                                   FORM 11-K

                ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934


(Mark One):
[X]  ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
     1934

     For the fiscal year ended December 31, 1998

                                      OR

[_]  TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
     OF 1934

     For the transition period from __________ to __________.


                       Commission file number: 333-77145

A.  Full title of the plan and the address of the plan, if different from that
of the issuer named below:

    PG&E Corporation Retirement Savings Plan

B.  Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:

        PG&E Corporation
        One Market, Spear Tower
        Suite 2400
        San Francisco, CA  94105
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                             REQUIRED INFORMATION

1.  The Statements of Net Assets of the Savings Fund Plan Master Trust as of
    December 31, 1998 and 1997 and the Statements of Net Changes in Net Assets
    of the Savings Fund Plan Master Trust for the years then ended, together
    with the report of Arthur Andersen LLP, independent accountants, the
    Statements of Net Assets Available for Benefits of the Savings Fund Plan
    Part I* (the Pacific Gas and Electric Company Savings Fund Plan for Non-
    Union Employees) as of December 31, 1998 and 1997 and the Statements of Net
    Changes in Net Assets of the Savings Fund Plan Part I* for the years then
    ended, together with the report of Arthur Andersen LLP, independent
    accountants, are contained in Exhibit 1 to this Annual Report.

2.  The Consent of Arthur Andersen LLP, independent accountants, is contained in
    Exhibit 2 to this Annual Report.



* As of June 1, 1999, Part I was transferred to the PG&E Corporation Retirement
  Savings Plan.
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                                  SIGNATURES

     The Plan.  Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.


                                PG&E CORPORATION RETIREMENT SAVINGS PLAN



Date:  June 30, 1999            By:  BRUCE R. WORTHINGTON
                                     ------------------------------------
                                     Bruce R. Worthington
                                     Chairman, Employee Benefit Committee
