FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person * MARKELL ERIC M   2. Issuer Name and Ticker or Trading Symbol PUGET ENERGY INC /WA [PSD] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner __X__ Officer (give title below) _____ Other (specify below) Sr. VP Energy Resources (Last) (First) (Middle) 10885 NE 4TH STREET, PSE-12 3. Date of Earliest Transaction (Month/Day/Year) 02/28/2007 (Street) BELLEVUE, WA 980045591 4. If Amendment, Date Original Filed(Month/Day/Year) 6. Individual or Joint/Group Filing(Check Applicable Line) _X_ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person (City) (State) (Zip) Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned

1.Title of Security (Instr. 3) 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common 02/28/2007   A   5,291 A (1) 11,599 D   Common 02/28/2007   M   2,535 A (2) 14,134 D   Common 02/28/2007   F   666 D $ 24.51 13,468 D   Common               10,407 I By Brokerage Account

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security (Instr. 3)

2. Conversion or Exercise Price of Derivative Security

3. Transaction Date (Month/Day/Year)

3A. Deemed Execution Date, if any (Month/Day/Year)

4. Transaction Code (Instr. 8)

5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5)

6. Date Exercisable and Expiration Date (Month/Day/Year)

7. Title and Amount of Underlying Securities (Instr. 3 and 4)

8. Price of Derivative Security (Instr. 5)

9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)

10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4)

11. Nature of Indirect Beneficial Ownership (Instr. 4)

Code

V

(A)

(D)

Date Exercisable

Expiration Date

Title

Amount or Number of Shares

LTIP

(3)

02/28/2007

J(4)

15,336

12/31/2006

12/31/2006

Common

15,336

$ 0

0

D

LTIP

(5)

02/28/2007

A

6,223

12/31/2009

12/31/2009

Common

6,223

$ 0

6,223

D

LTIP - 3 year cycle

(2)

02/28/2007

M

14,694

12/31/2006

12/31/2006

Common

14,694

(2)

0

D

LTIP

$ 0 (6)

12/31/2007

12/31/2007

Common

13,799

13,799

D

LTIP

$ 0 (5)

12/31/2008

12/31/2008

Common

7,172

7,172

D

PSE Deferred Compensation Plan

$ 0 (7) (8)

(8)

(8)

Common

1,188

1,188

D

Reporting Owners

Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
MARKELL ERIC M 10885 NE 4TH STREET, PSE-12 BELLEVUE, WA 980045591			Sr. VP Energy Resources

Signatures

By: /s/ James W. Eldredge		03/02/2007
**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 4(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1)	Performance based restricted stock grants under the Puget Energy Long Term Incentive Plan (LTIP) for Officers and Key Employees with dividend rights. Performance based restricted stock vests over a three-year period only if performance criteria are met. If performance criteria for vesting of the shares is met, 15% of performance shares will vest on January 1, 2008, 25% on January 1, 2009 and 60% on January 1, 2010.
(2)	Represents an award of 2004-2006 Puget Energy Long Term Incentive Plan performance shares.
(3)	LTIP share grants under the Puget Energy Long-Term Incentive Plan for Officers and Key Employees. LTIP Shares are paid in Puget Energy stock when vested in an amount ranging from zero to 175% of LTIP Share Grants.
(4)	0 shares were awarded for the 2003-2006 LTIP cycle grants. Outstanding share grants were forfeited.
(5)	Performance shares grants under the Puget Energy Long Term Incentive Plan (LTIP) for Officers and Key Employees. LTIP performance shares are paid in stock (or cash) when vested from zero to 175% of LTIP performance shares granted.
(6)	LTIP share grants under the Puget Energy Long-Term Incentive Plan for Officers and Key Employees. LTIP Shares are paid in stock (or up to 50% in cash) when vested in an amount ranging from zero to 155.5% of LTIP Share Grants.
(7)	One common share will be received for each stock unit.
(8)	Phantom share units deferred in the Puget Sound Energy Deferred Compensation Plan.

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