FYI.  Appears that the Davis administration has thrown down the gauntlet, 
looking to position itself in a way that will allow it to blame the FERC/Bush 
administration for California's electricity crisis, unless FERC agrees to the 
ISO's price cap plan.

Best,
Jeff

----- Forwarded by Jeff Dasovich/NA/Enron on 03/08/2001 10:41 AM -----

	"Katie Kaplan" <kaplan@iepa.com>
	03/08/2001 10:44 AM
		 
		 To: "'Alex Sugaoka (E-mail)'" <alex.sugaoka@uaecorp.com>, "'Bill Carlson 
(E-mail)'" <william_carlson@wastemanagement.com>, "'Bill Woods (E-mail)'" 
<billw@calpine.com>, "'Bob Ellery (E-mail)'" <bellery@spi-ind.com>, "'Bob 
Escalante (E-mail)'" <rescalante@riobravo-gm.com>, "'Bob Gates (E-mail)'" 
<bob.gates@enron.com>, "'Carolyn A Baker (E-mail)'" 
<cabaker@duke-energy.com>, "'Cody Carter (E-mail)'" 
<cody.carter@williams.com>, "'Curt Hatton (E-mail)'" 
<Curt.Hatton@gen.pge.com>, "'Curtis Kebler (E-mail)'" 
<curtis_l_kebler@reliantenergy.com>, "'David Parquet'" 
<david.parquet@enron.com>, "'Dean Gosselin (E-mail)'" 
<dean_gosselin@fpl.com>, "'Doug Fernley (E-mail)'" 
<fernley.doug@epenergy.com>, "'Douglas Kerner (E-mail)'" <dkk@eslawfirm.com>, 
"'Duane Nelsen (E-mail)'" <dnelsen@gwfpower.com>, "'Ed Tomeo (E-mail)'" 
<ed.tomeo@uaecorp.com>, "'Eileen Koch (E-mail)'" <eileenk@calpine.com>, 
"'Eric Eisenman (E-mail)'" <eric.eisenman@gen.pge.com>, "'Frank DeRosa 
(E-mail)'" <frank.derosa@gen.pge.com>, "Frazier Blaylock (E-mail)" 
<frazier_blaylock@ogden-energy.com>, "'Greg Blue (E-mail)'" 
<gtbl@dynegy.com>, "'Hap Boyd (E-mail)'" <Hap_Boyd@enron.com>, "'Hawks Jack 
(E-mail)'" <jack.hawks@gen.pge.com>, "'Jack Pigott (E-mail)'" 
<jackp@calpine.com>, "'Jim Willey (E-mail)'" <elliottsa@earthlink.net>, "'Joe 
Greco (E-mail)'" <jgreco@caithnessenergy.com>, "'Joe Ronan (E-mail)'" 
<joer@calpine.com>, "'John Stout (E-mail)'" <john_h_stout@reliantenergy.com>, 
"'Jonathan Weisgall (E-mail)'" <jweisgall@aol.com>, "'Kate Castillo 
(E-mail)'" <CCastillo@riobravo-gm.com>, "'Kelly Lloyd (E-mail)'" 
<kellyl@enxco.com>, "'Ken Hoffman (E-mail)'" <khoffman@caithnessenergy.com>, 
"'Kent Fickett (E-mail)'" <kfickett@usgen.com>, "'Kent Palmerton'" 
<kent.palmerton@williams.com>, "'Lynn Lednicky (E-mail)'" 
<lynn.a.lednicky@dynegy.com>, "'Marty McFadden (E-mail)'" 
<marty_mcfadden@ogden-energy.com>, "'Paula Soos'" 
<paula_soos@ogden-energy.com>, "'Randy Hickok (E-mail)'" 
<rjhickok@duke-energy.com>, "Rick S. Koebbe (E-mail)" 
<rskoebbe@powerworksinc.com>, "'Rob Lamkin (E-mail)'" 
<rllamkin@seiworldwide.com>, "'Roger Pelote (E-mail)'" 
<roger.pelote@williams.com>, "'Ross Ain (E-mail)'" <ain@worldnet.att.net>, 
"'Stephanie Newell (E-mail)'" <stephanie-newell@reliantenergy.com>, "'Steve 
Iliff'" <siliff@riobravo-gm.com>, "'Steve Ponder (E-mail)'" 
<steve_ponder@fpl.com>, "'Susan J Mara (E-mail)'" <smara@enron.com>, "'Tony 
Wetzel (E-mail)'" <twetzel@thermoecotek.com>, "'William Hall (E-mail)'" 
<wfhall2@duke-energy.com>
		 cc: "'Andy Brown (E-mail)'" <ABB@eslawfirm.com>, "'B Brown Andy (E-mail)'" 
<andybrwn@earthlink.net>, "'Bob Weisenmiller (E-mail)'" <rbw@mrwassoc.com>, 
"'Jan Smutny-Jones (E-mail)'" <smutny@iepa.com>, "'Jean Munoz (E-mail)'" 
<jmunoz@mcnallytemple.com>, "'Jeff Dasovich (E-mail)'" 
<Jeff.Dasovich@enron.com>, "'John Larrea (E-mail)'" 
<john.g.larrea@williams.com>, "'Julee Malinowski-Ball (E-mail)'" 
<jmball@ns.net>, "'Kassandra Gough (E-mail)'" <kgough@calpine.com>, "'Katie 
Kaplan (E-mail)'" <kaplan@iepa.com>, "'Kristin Vellandi (E-mail)'" 
<kvellandi@pstrategies.com>, "'Lynn Lednicky (E-mail)'" <lale@dynegy.com>, 
"Marie Moretti (E-mail 2)" <mmoretti@mccabeandcompany.net>, "'Marty Wilson 
(E-mail)'" <mwilson@pstrategies.com>, "'McNally Ray (E-mail)'" 
<rmcnally@mcnallytemple.com>, "''Nam Nguyen' (E-mail)'" 
<nam.nguyen@powersrc.com>, "'Norton Kelli (E-mail)'" 
<knorton@mcnallytemple.com>, "'Paula Hall-Collins (E-mail)'" 
<paula.hall-collins@williams.com>, "'Richard Hyde (E-mail)'" 
<rwhyde@duke-energy.com>, "'Theo Pahos (E-mail)'" <tpahos@ppallc.com>, "'Tom 
Ross (E-mail)'" <tross@mcnallytemple.com>
		 Subject: FW: CAISO Notice - Draft Market Stabilization Plan


Greetings:
Late last night the ISO released a Market Stabilization plan that would
essentially impose cost based pricing control caps and apply a strict
California First Policy.

Here's ISO's 3-page sketch to impose cost-based pricing intended to control
costs on consumers on very short order.  Unit-specific cost-based bid caps
will apply to ISO markets.  ISO will have dispatch control over all CA
generation.  Capital costs and return appear to be excluded from the bid
caps.  ISO will pick of the day-ahead and day-of energy markets lot to the
demise of CalPX, thus ending the "market separation."  There appears to be
language that intimates direct unit dispatch, but the document is very thin
on this. ISO proposes payments based either on the "as-bid" up to unit bid
cap, or apparently a uniform market-clearing price based on marginal units
cap.  Out of state resources are paid California capped rates.  Settlement
will be on numbers other than those posted (so much for transparency).
There's looking to procure AS based on optimization, although this is not
spelled out well (it appears that self-provision is gummed up completely).

To prevent "MW Laundering" CA will required in-area generation to make all
capacity
available whenever Stage 1 or higher emergency (i.e., reserves below 7%).
This California
First! rule means the generation must be scheduled against CA loads or bid
into day-ahead
market.  If you don't bid your bid cap is applied.  There will be a capacity
element
similar to RMR.  This change will require FERC buy-in, which obviously will
be
litigation-central, and its likely to create a cascade of similar
requirements from other
states ...

Thanks Andy for the quick summary!

IEP will monitor the Friday call and review all documents to let people know
what is happening.

Katie Kaplan
Manager of State Policy Affairs
Independent Energy Producers Association
(916) 448-9499

-----Original Message-----
From: Woertz, Byron [mailto:BWoertz@caiso.com]
Sent: Wednesday, March 07, 2001 6:40 PM
To: ISO Market Participants
Subject: CAISO Notice - Draft Market Stabilization Plan

                ISO Market Participants:
                Attached is the ISO's draft market stabilization plan.  This
document will be the basis of our conference call on Friday, March 9th at
10:00.
                 <<Market Stabilization Draft 010307.doc>>
                Byron B. Woertz, Jr.
                Director, Client Relations
                (916) 608-7066

 - Market Stabilization Draft 010307.doc
Enron Emails
Enron Emails