Trust And Antitrust
The New York Times, 06/24/01

Looking at E-Business From Both Sides Now
The New York Times, 06/24/01

Getting Serious About Earth-Friendly Energy
Los Angeles Times, 06/24/01

ENERGY CRUNCH / Power players lay blame / Deregulation creators defend their
actions
The San Francisco Chronicle, 06/24/01

USA: California power refund talks begin Monday at FERC.
Reuters English News Service, 06/24/01

PGE CRITICIZES ELECTRICITY PRICE LIMITS
Portland Oregonian, 06/24/01

India: Calcutta HC rejects EMC plea
Business Line (The Hindu), 06/24/01

India: DPC lenders unhappy with S&W report
Business Line (The Hindu), 06/23/01

Enron CEO gets pie in face
Press Trust of India Limited, 06/23/01

POWER POLLUTION NO LAUGHING MATTER
South Florida Sun-Sentinel, 06/23/01

San Francisco Tourists Just Roll with the Outages
Contra Costa Times - Walnut Creek, California, 06/23/01

El Paso Awaits Decision as Generators Prepare to Face Lawsuits
Bloomberg, 06/23/01

Alleged Power Overcharges May Be Less Than Calif Argues
Dow Jones Energy Service, 06/22/01

Editorial Desk; Section 4
Reckonings
Trust And Antitrust
By PAUL KRUGMAN

06/24/2001
The New York Times
Page 13, Column 1
c. 2001 New York Times Company

When the European Commission indicated it was likely to block the proposed
merger between General Electric and Honeywell, American politicians from
George W. Bush on down cried foul, with some alleging that the decision was
politically motivated. They're almost certainly wrong about that, but it is
true that the E.C.'s case against the merger is far from watertight. Mario
Monti, Europe's competition referee, may have made a bad call on this play.
Nonetheless, our politicians should lower their voices. Mr. Monti is one of
the good guys in today's global economy. He should not be made the target of
attempts at political intimidation.
To put the G.E.-Honeywell affair in context, you need to realize that this
case is a triple switcheroo: it contradicts not one but three pieces of
conventional wisdom.
First, the conventional view is that globalization weakens governments,
because it forces them to compete for private investment. Broadly speaking,
this view is right. (Conventional wisdom usually is.) There are, however,
exceptions to the rule, and antitrust policy is one of those exceptions. In
today's world, no company can compete effectively unless it can operate
freely on both sides of the Atlantic -- which it can do only with a green
light from antitrust authorities in both the United States and Europe. The
result is that instead of eroding the power of those authorities,
globalization has extended their reach: American regulators can block
European mergers, and vice versa.
Second, this case inverts traditional roles. Until recently, only the U.S.
seemed to take antitrust policy seriously. Europeans might have U.S.-style
legislation on the books, but they often seemed to feel that cartels, like
extramarital affairs, were nothing to worry about as long as the participants
were discreet -- and they were scornful toward puritanical Americans who
insisted on enforcing the letter of the law. Lately, however, Europe has
gotten serious about antitrust, giving the competition commissioner broad
powers to block mergers and investigate allegations of anticompetitive
behavior. Mr. Monti, an American-trained university professor who assumed
that office in 1999, has used those powers aggressively. General Electric and
Honeywell are by no means the first companies to find Mr. Monti blocking what
they thought was a done deal.
Was Mr. Monti right to block this particular deal? It's a complicated issue.
Let's just say that the case against this merger is similar to the case for
breaking up Microsoft, though it seems a lot weaker. On the other hand, you
don't need as strong an argument to block a merger as you do to break up a
going concern. We're in a gray area, with the precise shade of gray a matter
of opinion.
Even if you disagree with Mr. Monti's opinion, however, his sincerity is not
in doubt. The best answer to those who claim that this is really a
protectionist ploy is Mr. Monti's track record: he has repeatedly shown
himself willing to oppose the demands of powerful European interest groups.
Why would he suddenly become a tool of protectionists?
And that leads us to the third switcheroo. Europeans are accustomed to cozy
cohabitation between politicians and businessmen; Americans tend to insist on
at least the appearance of an arms-length relationship. But just at the
moment when the Europeans have placed competition policy in the hands of a
sternly upright professor, the United States has acquired an administration
that seems oblivious to normal concerns about conflict of interest.
It's not yet clear whether the Bush administration really is a government of,
by and for big corporations to an extent not seen since Warren G. Harding was
president, or whether it just looks that way. But the stories keep
accumulating. Intel's chief lobbyist says that his highly inappropriate
meetings with Karl Rove were ''quite useful'' to its merger case -- and Mr.
Rove didn't even get a slap on the wrist. According to the outgoing chairman
of the Federal Energy Regulatory Commission, the head of Enron offered to
support him at the White House if he changed his policy positions. And it
took three months -- and a sharp prod from Jake Tapper at Salon -- before
Treasury Secretary Paul O'Neill honored his promise to sell his Alcoa stock.
As a consumer, I'm not sure I trust these people to protect me from the
market power of giant corporations.
And so it's nice to know that Mr. Monti is out there, looking after my
interests.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

Money and Business/Financial Desk; Section 3
BOOK VALUE
Looking at E-Business From Both Sides Now
By FRED ANDREWS

06/24/2001
The New York Times
Page 6, Column 1
c. 2001 New York Times Company

BOOKS about e-business have proliferated over the last year. Undeterred by
the dot-com crash and financial travails of many Internet companies, business
publishers have turned to churning out an ever-widening array of guides to
help well-established companies prosper on the Web.
The books range from simplified manuals to weighty analyses of the dynamics
of e-business ventures. Here are two examples at opposite ends of the
spectrum: ''D2D: Dinosaur to Dynamo'' by David Stauffer (John Wiley & Sons,
$27.95), and ''Place to Space: Migrating to E-Business Models'' by Peter
Weill and Michael R. Vitale (Harvard Business School Press, $35).
At first blush, ''D2D'' is a once-over-lightly account, a scissors-and-paste
recycling of other books and the business press, duly footnoted, to be sure.
The pages are salted with so many diverting lists, special boxes and
eye-catching headlines (''Why the Web Can Be Farmer-Friendly'') that the main
text is an annoying weave through an obstacle course. With short paragraphs
and lots of space between lines, the book cried out to be skimmed.
But Mr. Stauffer, who has written books about America Online and Cisco
Systems and many articles explaining how companies have adapted to the
Internet, has assembled a fascinating menagerie of 20 businesses that have
taken to e-business with great success. His brief histories include the
obligatory e-favorites -- Enron, General Electric, Charles Schwab -- as well
as peers like Ford Motor and Bertelsmann. But he also tells you about Snap-on
Inc., DoveBid industrial auctioneers, the Antevia Inc. relocation service and
Powell's Books of Portland, Ore., a thriving ''independent'' whose
68,000-square-foot flagship is one of the nation's largest bookstores.
Powell's began in 1970, buying lightly used textbooks for next to nothing and
reselling them at substantial mark-ups. Now a $36 million business, Powell's
has found its Web site ideal for matching a used, rare or out-of-print title
from its enormous holdings with someone, somewhere, who wants to buy it.
Unlike Amazon.com, its famous competitor, Powell's makes money online (and
has done so from Day 1). Its annual sales volume of $232,000 per online
employee is higher than Amazon's. And what happens to books that customers
return to Amazon? Powell's buys them, at nearly 80 percent off the cover
price.
Further afield, Tesco, the huge supermarket chain in Britain, has become a
leading Internet grocery by tying its Web delivery service to its local
stores. Snap-on, of Kenosha, Wis., sells high-quality tools for auto
mechanics through 6,000 franchisees who drive its distinctive white vans; the
company solved its ''channel conflicts'' by paying franchisees for Internet
sales as though they had made the sales themselves. DoveBid, an $80 million
appraiser and auctioneer of used business and industrial equipment, has
pioneered simultaneous live and Web auctions.
Like a baseball scout who prefers the honesty of minor league ball, Mr.
Stauffer pays these less prominent players refreshing respect. Though he
commonly relies on second-hand material, he is scrupulous with footnotes and
credits. His judgments are not bad, and in more than half the histories he
adds his own interviewing. Each chapter opens with a capsule company profile
and closes with ''Leader's Lessons,'' the author's observations.
A final chapter on ''what it takes to make it'' is nothing out of the
ordinary. Mr. Stauffer says the digital world requires a ''vocal and
unflagging'' chief executive. He also says a company needs ''bricks and
clicks that don't discriminate'' -- in other words, don't think of online and
offline as separate markets. His other advice: provide added services and
follow the rule that it's better ''to be fast than to be right.''
The book concludes with 60 offhand homilies on e-business success. No one
will accuse ''D2D'' of being profound.
But what's not to like about an all-star team that makes room for tiny
Quality Transmission Service, a $400,000, six-employee operation in Tempe,
Ariz.? Its founder, Bob Jones, built a shoestring Web site that has become a
model for local businesses. His ''Ask Bob'' feature attracts 10 or 12
questions a day. The Web site has lured customers from 35 miles away (the
shop's normal reach is 10 miles) and reliably brings in two or three new
customers a week -- a 15 to 20 percent increase for Mr. Jones's business.
''PLACE TO SPACE,'' more academic than other e-biz books, offers as clear an
explanation of the anatomy of e-business as one could expect. From extensive
study, the authors have concluded that all e-business can be reduced to one
or another of eight basic building blocks, which then combine into more
complex companies, like atoms forming a molecule.
Mr. Weill is director of the Center for Information Business Systems at
M.I.T.; Mr. Vitale is dean and director of the Australian School of
Management at Sydney. Their strength is not originality but the clarity and
thoroughness of their analysis.
Their eight building blocks, which they call ''atomic e-business models,''
are already part of the digital vocabulary. The array includes
direct-to-customer sales (Amazon, for instance); full-service providers (GE
Supply); shared infrastructure (reservation systems); virtual communities
(Motley Fool); portals, auctions and aggregators (Yahoo and eBay), and
content providers (AccuWeather and Morningstar).
The book devotes a methodical chapter to each, dissecting what each way of
doing e-business assumes, how it works, what holds it together. A tutorial
follows on infrastructure, distribution channels and market segments. The
authors cover core competencies, strategic objectives and sources of value.
Eventually, this extensive learning is distilled into seven pages of tables,
laying bare the logic of all eight models and enumerating, say, nine factors
critical to a direct-to-customer business like Amazon's or three core
competencies for running a virtual community like iVillage.
Some readers may like the crisp schematics that accompany the text. Others
may mistake the drawings for an attack plan for multiple-warhead nuclear
missiles. The schematic of an Internet-based investment business has six big
arrowheads on the left, three on the right, all menacing a big black
rectangle, along with smaller arrows and dotted lines.
No question, this book is homework. Thankfully, the authors leaven the
abstract, didactic parts of their work with abundant examples from a
half-dozen cogent case studies. Among the cases are Reuters, CDNow, GE Supply
and, especially interesting, Lonely Planet, the Australian publisher of
travel guides for vagabonds.
From one lone title 30 years ago (''Across Asia on the Cheap''), Lonely
Planet has prospered to about 600 titles, 400 employees and 65 million
Australian dollars (about $34 million) in revenue for 2000. Its Web site
draws three million daily hits, reflecting the attraction of the Thorn Tree
chat room, where travelers keep in touch and exchange tips by posting 1,500
messages a day. Lonely Planet also offers global voice mail and CitySync, a
digital download of guides to major cities. It has undertaken the ambitious
job of converting all its guides, maps and detailed research to accessible
digital form.
Even on this solid base, e-business raises tough questions for Lonely Planet.
How can it make money from the two million fans of its Web site? Should it
try? How should it handle ''channel conflict'' and balance sales from the
Internet with its traditional retailers' interests?
As its rule of thumb, Lonely Planet looks for some assurance that it will get
a 50 percent gross margin before embarking on a new guide. The authors ask
whether e-business ideas are ever firm enough to meet that hurdle. And most
intriguing, the authors write that Lonely Planet has ''a huge opportunity''
to reinvent the travel guide by customizing digital guides to a traveler's
itinerary and tastes, with digital updates delivered along the way.
THOUGH newly published, ''Place to Space'' is already dated. The authors
refer to the ''partial'' fall of dot-coms but not to the later convulsions.
The book continually describes (but does not necessarily praise) e-ventures
long since laid low. What reader would suspect that Motley Fool just
announced its second round of layoffs this year or that Hearst narrowly
rescued iVillage from Nasdaq delisting? The book notes that in four months,
Priceline.com signed up nearly 500,000 customers for its ultimately
disastrous Web-based grocery service. ''The approach seems popular,'' the
authors observe.
Though every book risks obsolescence from events, their study gives little
hint of the coming tempest. Reading ''Place to Space'' is like watching a
video visit to the zoo without knowing that the lion, the walrus and most of
the monkeys have died. The book's explanatory value still stands, but the
dot-com massacre does raise questions about what some examples actually
exemplify.
Still, the book has endearing touches. At one point, the authors explain the
remarkable success of Asian airlines in putting bickering aside and building
Abacus, a joint computer reservation system. The decision to cooperate rather
than compete, they say, ''was probably motivated by a combination of fear and
greed.'' How often do you find candor like that?

Photos

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

Business; Financial Desk
JAMES FLANIGAN
Getting Serious About Earth-Friendly Energy
JAMES FLANIGAN

06/24/2001
Los Angeles Times
Home Edition
C-1
Copyright 2001 / The Times Mirror Company

The growing concern about global warming--even President Bush concedes the
need to reduce carbon dioxide emissions--promises a shift to nonpolluting
energy sources and new attitudes toward environmental investment in industry
in the years ahead.
Change will be more gradual than dramatic, perhaps a 20% rise in use of wind
and solar power to generate electricity and the beginnings of commercial use
of fuel cells to drive cars and trucks by 2010.
Nonpolluting, renewable energy will still make up less than 7% of total U.S.
energy consumption 10 years hence, predicts the Energy Department. But trends
will be established in this decade.
Business will base investment on environmental concerns as never before.
Reminders that the Earth's temperature will rise for the next 50 years no
matter what we do now will bolster development of energy-efficient machines
and industrial processes.
The chemical firm DuPont Co., for example, aims to reduce emissions of
greenhouse gases--carbon dioxide and methane--by 65% over this decade. Also
by 2010, DuPont hopes to rely on renewable sources for 10% of its energy use.
That 10% estimate may not sound heroic, but it's based on the expectation
that renewable energy will be cost-competitive with oil, natural gas and
coal, says Paul Tebo, DuPont's vice president for environmental and health
policies. "It's important that renewables become cost-competitive because
investing in them if they're uneconomic creates other problems," Tebo says.
Where does the business of renewable energy stand today? Wind power is
attracting a lot of investment and will grow rapidly in the next few years.
Solar power now boasts $2.7 billion in annual sales worldwide; only 25% of
those sales, however, are in the U.S.
Fuel-cell development is intense, with every major automotive company backing
research and testing pilot projects for on-board power plants in which
hydrogen energy drives the car and most of the exhaust is clean water. By
2008, vehicles propelled by fuel cells will be used by early adopters, as
hybrid cars are today, says Dan Sperling, head of the Institute for
Transportation Studies at UC Davis, a major center of fuel-cell research.
More than $1.5 billion will be invested this year in projects to generate
electricity from wind power, says Randy Swisher of the American Wind Power
Assn. in Washington. That's double the previous highest investment total.
Investment is growing because wind power has become efficient. A single
windmill generator today is capable of doing the work of 10 windmills of the
1970s, when wind-power experiments began.
Wind generation can deliver electricity at 3 cents to 6 cents a
kilowatt-hour, promising a $15 to $30 electric bill for the average home that
uses 500 kilowatt-hours per month.
In addition, wind-power projects are being encouraged by a federal tax credit
of 1.5 cents per kilowatt-hour to the investing companies.
FPL Energy, a subsidiary of Florida's FPL Group, and Enron Wind Corp., a
subsidiary of Enron Corp., are the largest companies in wind generation. But
mostly it is a business of small firms and investment partnerships.
Zilkha Renewable Energy, a privately held Houston firm, will be involved in
$100 million worth of wind-power projects this year in Iowa, Pennsylvania,
California and Britain, often in partnership with Denmark's EnXco Inc.
Denmark gets 15% of its electricity from wind power, a typical percentage for
European countries, which are more environmentally conscious than the U.S.
Solar energy is still comparatively expensive, producing electricity from
photovoltaic cells at 20 cents to 30 cents a kilowatt-hour. That would equate
to monthly electric bills of $100 to $150 for the average home.
Solar energy can be produced more cheaply by vast solar arrays in desert
areas. This method, called thermal, can produce power at 10 cents a
kilowatt-hour today, says Avi Brenmiller, chairman of Solel Solar Systems, an
Israeli firm that built a giant solar thermal plant in California's Mojave
Desert.
An irony is that Israel, a largely desert country, does not use a lot of
solar power to date--mostly because conventional fossil-fuel power has been
cheaper, Brenmiller says. Brenmiller looks for new solar projects to be
launched in the U.S. and abroad as a result of uncertain energy prices and
availability.
The main cost of solar energy is the capital needed to build panels of solar
cells on roofs of homes and buildings and on farms to run irrigation. "After
the plant is built, the cost of fuel--the sunlight--is essentially zero,"
observes Marwan Masri, director of renewable energy for the California Energy
Commission.
State and federal grants of up to half the capital cost encourage solar
projects. Masri is working with home builders to install solar cells in all
homes in new subdivisions, so the cost of providing energy can be amortized
over 30 years along with the home mortgages.
Meanwhile, solar energy powers buildings, traffic lights and irrigation
projects around the world, with Japan and Germany using more solar energy
than the U.S.
BP Solar, a division of BP; Kyocera Corp. of Japan; and Siemens of Germany,
which owns the former Westinghouse Electric Corp. in the U.S., are global
leaders in solar.
But the technology of solar cells, akin to that of semiconductors, is still
under development. Small firms, such as Evergreen Solar Inc. of Marlboro,
Mass., and AstroPower Inc. of Newark, Del., are working on cheaper and more
effective ways to make solar cells, reports analyst James LoGerfo of Banc of
America Securities.
In fuel cells, Xcellsis, a joint venture of DaimlerChrysler, Ford Motor Co.
and Ballard Power Systems Inc., has developed fuel-cell engines based on
methanol and gasoline for demonstration models being tested in Germany and
the U.S.
Fuel cells that derive hydrogen from gasoline, methanol or natural gas are
less environmentally ideal than improved models that will appear later in the
decade.
But, clearly, new industries that will change the way the world lives are
taking their first big steps. And concerns about global warming that are
giving these industries a push today won't diminish in the years ahead.
Climate change that will add 2.5 to 10 degrees to the Earth's temperature
over the next 50 years is already assured because of heat from past emissions
that is stored in the world's oceans, reports UC Irvine Chancellor Ralph J.
Cicerone, a renowned atmospheric scientist, who headed a recent study of
global warming for President Bush.
As temperatures mount, so will sentiment and pressure for new thinking on
energy, environment and the world economy.
*
James Flanigan can be reached at jim.flanigan@latimes.com.

PHOTO: More than $1.5 billion is expected to be invested this year in
wind-power projects.; ; PHOTOGRAPHER: Zilkha Renewable Energy Co.; PHOTO:
Zilkha Renewable Energy of Houston is at work on this wind-power project in
California's Altamont Pass area.; ; PHOTOGRAPHER: Zilkha Renewable Energy Co.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

NEWS
ENERGY CRUNCH / Power players lay blame / Deregulation creators defend their
actions
Robert Salladay
Chronicle Sacramento Bureau

06/24/2001
The San Francisco Chronicle
FINAL
A.1
(Copyright 2001)

Five years after dismantling California's energy markets, former Gov. Pete
Wilson says he's proud of his role in deregulation and is "stunned and
outraged" that his successor tries to pin the blame on him.
Former state Senate President pro tem Bill Lockyer, now the state attorney
general, is both contrite and vengeful, recently saying he wanted to put a
powerful energy executive -- and friend of President Bush -- in prison with
an amorous cellmate named Spike.
Former Assembly Speaker Curt Pringle, presently a lobbyist, now forwards
e-mail jokes to fellow Republicans with Davis re-election slogans, including:
"Davis in 2002: Your bridge to the 18th century."
These were the leaders who brought deregulation to California. As they engage
in deflections and defenses one year after the state plunged into crisis,
their comments also highlight a newer debate over unintended consequences,
the role of the federal government in making things worse, and the
neglectfulness of subsequent politicians.
For his part, Wilson has become increasingly angry at the Davis
administration's "offensive and unfair" claims that Wilson and the
Legislature got the state into this mess.
"I'm afraid they have reached the conclusion that the response has been too
little, too late to avoid what will be hundreds of hours of blackouts, and
that they better find a way to blame somebody else," Wilson said.
Davis, he said, has blamed "the new administration in Washington, the old
administration in Sacramento, power providers. It's interesting, because
there was not a peep out of the lieutenant governor (Davis) at the time
during what I thought was a fairly active and public debate. He was hardly
without a voice, but he certainly was without comment."
Wilson said Davis' performance over the past year called into question Davis'
1998 campaign slogan. "I used to laugh when he talked about being the
best-trained, best-prepared candidate in history," Wilson said. "But what the
hell."
DEREGULATION BILL
A tiny legislative committee that was dominated by state Sen. Steve Peace,
D-El Cajon, and then Assemblyman James Brulte, R-Rancho Cucamonga, wrote the
deregulation bill in 1996. Corporate lobbyists and utilities also had
tremendous sway over the legislation. Pringle, Lockyer and Wilson steered the
legislation their way.
The bill was a reaction to movements under way at the California Public
Utilities Commission and in the federal government. The bill essentially
unbundled the big utilities' monopoly over power, separating control of
selling, marketing and producing energy.
It also was supposed to cut rates 10 percent and pay utilities hundreds of
millions of dollars for investments they'd made in nuclear power and other
energy plants.
Wilson said Davis should, in fact, be grateful that the 1996 deregulation
bill encouraged power companies to expand into California. He contends that
without the measure, the state would be faced with a regulated market and
10,000 fewer megawatts of power -- and more blackouts.
DAVIS' COMPLAINTS
Davis has continually said that California failed to build power plants in
the 12 years before his administration. In truth, seven smaller power plants
were built during Wilson's eight years, and deregulation started the process
on a host of others that are now being approved more quickly by the Davis
administration.
"We wanted to entice investors," Wilson said. "You can't do that if they're
not allowed to compete."
Wilson acknowledges that the state misread exactly how quickly California
would grow. During the high-tech boom, Silicon Valley built acres of "server
farms" to supply the Internet that accounted for a large amount of the
increase in new power usage in California.
Peace has point-blank blamed executives at Cisco Systems. He has said they
should be thrown in jail for simultaneously supplying the server-farm boom
and opposing the building of a power plant in Santa Clara County. Cisco
opposed the 600-megawatt plant, it said, to protect the health and welfare of
its employees nearby.
Wilson doesn't go as far as Peace in wanting to jail people. And he's not
willing to accuse out-of-state generators of price-gouging, in part because
"blanket condemnation" may scare away further investment in California -- and
it ignores that some municipal utilities in California charge high prices as
well.
"If they find that people have in fact manipulated the market," Wilson said,
"then they ought to come down hard on them."
LOCKYER'S HARDER LINE
As attorney general, Lockyer has opened an investigation into whether power
companies have conspired to push up electricity prices and gouge consumers.
Unlike Peace and Wilson, Lockyer is unwilling to defend the 1996 legislation
and deregulation.
"If I could repeal it and start all over again, I think that I would," he
said.
But even Lockyer acknowledges that the Legislature needed to do something in
1996. That's because it appeared inevitable that the utilities and corporate
interests would get some form of deregulation through the state PUC and the
federal government, which had already opened up the natural gas market.
"Our energy experts thought the PUC was doing it in a way that was overly
friendly to big business and would have ended up having residential customers
subsidizing big business," Lockyer said. "The efforts were made to try to
figure out how to make the market competitive without tilting toward big
business."
The real killer in deregulation, Lockyer contends, is that neither the
Legislature (himself included) nor the governor paid enough attention to the
supply end. That allowed a handful of firms to have near-total control over
power output, Lockyer said. Peace has called this the "domestic equivalent of
OPEC in the West."
Lockyer has been busy demonizing power firms as well. He still faces
criticism for telling the Wall Street Journal his plans for Kenneth Lay,
chairman of the Texas energy trader Enron Corp.: "I'd love to personally
escort Lay to an 8-by-10 cell that he could share with a tattooed dude who
says, 'Hi, my name is Spike, honey.' "
Lockyer, who told The Chronicle he was directing his comments to the East
Coast financial establishment, toned down a bit in a more recent interview.
"The system works well. It doesn't work when there is illegal activity and a
handful of companies that control the whole market," Lockyer said.
And then there is Pringle, who generally has escaped questioning for his role
in getting the 1996 measure passed.
Pringle said he had little impact on the legislation, relying instead on
Brulte.
But he puts some blame on consumer groups that offered Proposition 9 in 1998,
which set out to roll back much of the deregulation measure.
Wilson has charts from the state energy commission showing the application to
build plants spiked up after the measure was defeated. "At the most critical
moment," Pringle said, "when we were trying to suck development into the
state, you had trepidation."
Wilson, Lockyer and Pringle have been relatively silent on the matter when
compared with Peace.
Peace has been waging his own relentless war, both defending the 1996
legislation and accusing the federal government of "creating a flawed
national model of electricity deregulation and then (failing) to confront the
consequences."
The real culprit is far more complicated than just Proposition 9, Peace
contended in a recent letter to Bush.
The state PUC, he said, ordered utilities in the early 1990s to build more
plants, but the utilities got federal regulators to overrule the order.
Among other things, he said, the federal government uncritically adopted a
flawed plan separating the West's transmission system from the generation of
electricity. That allows generators to extort the grid operator by
threatening to withhold power, he added.
Pringle said he can't even attempt to get as detailed as Peace when it comes
to explaining what went wrong.
"Everyone has a degree in which they need to stand up, but the people in
charge today are in charge of fixing it," Pringle said. "If you want to go
around the rosy and say did Republicans blow something? Yeah. Did Wilson?
Yeah. Lockyer, Brulte, Peace? Yeah. The consumer associations? We're all
tagged."

PHOTO (5); Caption: (1) Bill Lockyer, state attorney general, raked energy
CEOs., (2) James Brulte, assemblyman, helped craft deregulation., (3) Curt
Pringle, ex-Assembly speaker, scorned Davis., (4) Steve Peace, state senator,
wants Cisco Systems execs., (5) Pete Wilson, ex- governor, rapped Gov. Gray
Davis.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

USA: California power refund talks begin Monday at FERC.
By Chris Baltimore

06/24/2001
Reuters English News Service
(C) Reuters Limited 2001.

WASHINGTON, June 24 (Reuters) - California officials looking to win some
payback from power generators who have reaped huge profits from selling
electricity to the state and its utilities get an opportunity this week to
prove their case and push for up to $9 billion in refunds.
A Federal Energy Regulatory Commission (FERC) administrative law judge
overseeing refund settlement talks in California's power market said Friday
the energy firms that sold electricity in the state will probably have to pay
back overcharges of "several billion dollars."
In an interview with Reuters, Judge Curtis Wagner, the head FERC
administrative law judge who will preside over the 15-day conference starting
Monday, said California Gov. Gray Davis' claim the state was owed $9 billion
was excessive.
"I think that's high," Wagner said when asked about Davis' figure.
"I'm hoping to come up with a settlement of the issue of a refund of
overcharges - if there are overcharges. My sense is that there probably are,"
he said.
FERC clarified late on Friday that the settlement talks are not limited to
possible California refunds, but may also focus on settling past accounts
related to other power sales in the Pacific Northwest.
Enron Corp. , Mirant Corp. , Duke Energy Corp. , Williams Cos. , Reliant
Energy Inc. and Dynegy Inc. are among the producers that FERC could compel to
make refunds. The companies have said they did nothing wrong.
Davis, the California Public Utilities Commission and the state's
investor-owned utilities will join in the negotiations at FERC headquarters
in Washington. If no agreement is reached, Wagner will have seven days to
make a recommendation to the five FERC commissioners on the refund issue.
The chasm of opinions between the two sides is huge. Davis says power
companies like Duke and Enron collectively owe his state $9 billion in
refunds for overcharges, a far cry from the $130 million in refunds FERC has
so far approved.
Reliant is one of the energy companies that bought power plants divested by
California utilities as a condition of the state's ill-fated deregulation
plan. Along with firms like Dynegy and Enron, it sold power from those plants
to the state for rates at up to $1,000 a megawatt hour.
ENERGY FIRMS BALK AT REFUND DEMAND
Energy producers have balked at Davis' $9 billion figure.
"Obviously we don't agree with figure," said a spokeswoman for Reliant
Energy. "We don't think it's anywhere close to that magnitude."
A Dynegy spokesman said $9 billion was excessive, and Dynegy was "willing to
discuss any reasonable proposals that will lead to a long-term solution."
Davis has painted the energy companies as modern-day robber barons looking to
"bilk" his state out of millions of dollars.
"California has been a cash cow to a lot of energy companies ... that have
done extraordinarily well," the California governor said last week during
Senate testimony.
Davis said he based his figure on a study by the California Independent
System Operator's Department of Market Analysis, which said wholesale prices
exceeded "reasonable competitive market levels" by about $6.7 billion between
May 2000 and February 2001. Extended through May 2001, that amount is closer
to $8.9 billion.
"Refunds are ... a primary vehicle to provide relief" to high energy prices,
Davis said at a Senate hearing Wednesday. "They should be repaid."
Davis accused FERC commissioners of being "asleep at the switch" for not
taking prompt action on refunds.
As part of FERC's price mitigation plan adopted last week to rein in rampant
prices in the California wholesale power market, the agency required all
public utility buyers and sellers to participate in the conference.
All California generators, investor-owned utilities, some municipal utilities
and state officials from the Public Utility Commission and Davis' office will
attend, Wagner said.
The administrative law judge said reaching an agreement in the 15-day period
scheduled for the conference was "going to be tight."
"But it's something we need quick action on," he added. "Sometimes it's best
to have a short time period to do something."
Wagner is also separately hearing the California Public Utilities
Commission's complaint accusing El Paso Corp. of improperly sharing
information with its natural gas marketing arm to boost the price of natural
gas deliveries to California.
The judge has found himself at the center of a political whirlwind over the
role U.S. regulators should take to head off the California energy crisis.
The White House has repeatedly rejected price caps, while Democrats insist
they are the only way to shield rate payers from prices ten times higher than
usual.
"The political arena is not making it any easier," Wagner said, though he
said no lawmaker had contacted him directly on the issue.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

BUSINESS
PGE CRITICIZES ELECTRICITY PRICE LIMITS
GAIL KINSEY HILL of the Oregonian Staff

06/24/2001
Portland Oregonian
SUNRISE
F01
(Copyright (c) The Oregonian 2001)

Summary: The utility says the federal action could make Oregonians the losers
this winter
When federal regulators set price limits last week on wholesale electricity
in the West, they intended to buffer rate increases for consumers and ease
energy shortages in the region.
They may have failed on both counts, at least in the Northwest, according to
Oregon's largest utility.
"Oregonians could well be losers," said Fred Miller, executive vice president
of Portland General Electric, which serves 728,000 residential and business
customers in the state.
PGE officials were so disturbed by the Federal Energy Regulatory Commission's
order that on Friday they faxed a letter to Oregon's congressional delegates
warning that the provisions could increase the likelihood of shortages in the
Northwest this winter, hamper conservation efforts and discourage developers
from building new power plants.
PGE may be the commission's harshest critic in the Northwest. By late last
week other utility officials were still sorting through the 50-page order the
commission posted Tuesday, trying to figure out whether the order bore good,
bad or inconsequential news.
PacifiCorp, Oregon's second-largest utility, declined to comment until
officials had thoroughly reviewed the order.
Some hoped for relief from high-cost power purchases. Others fretted over a
bad situation made worse. But none of the utility officials interviewed by
The Oregonian embraced the order as a sure- fire antidote to energy shortages
and rising retail rates.
PGE serves about 40 percent of the state's electricity customers, primarily
in the populous northern Willamette Valley. The utility, a subsidiary of
power marketer Enron Corp., has opposed price caps ever since policy-makers
began bandying about the idea some months ago.
Under the commission's order, price limits move up or down based on the
operating costs of the least efficient gas-fired power plant called into
service in California during a declared power emergency.
The floating cap is a relatively tame approach to price controls, but PGE
still doesn't like it.
"If you freeze prices, you're going to get more demand and less supply," the
very responses utilities have been trying to counter, Miller said.
During the past year, PGE benefited from high-priced markets. It bought more
power than it needed to serve customers, then sold the excess at a profit.
The strategy is not s sure thing. PGE could have lost money. But it came out
ahead, and it used the proceeds to waylay rate increases.
While utilities throughout the Northwest were raising rates by double digits,
PGE was holding steady.
"We bought long," Miller said. "That's how we avoided rate increases."
Miller has another big worry. This winter. The regulatory commision's order
links the price caps to the operating costs of the least efficient gas-fired
plant operating in California during electric emergencies. In nonemergency
times, the limit falls to 85 percent of that price.
That means the lower price likely will prevail in winter, when demand
slackens in California but rises in the Northwest. Miller maintains the lower
price could discourage suppliers from selling into the region, which
increases the likelihood of shortages in the Northwest.
"Maybe what's most irksome," said Miller, "is that we essentially have turned
over our future this winter to the Californians."
Then, there's B.C. Hydro, a power provider that often sells large amounts of
power to the Northwest in the winter. The price controls may not apply to the
Canadian utility, and Northwest buyers may be forced to pay top dollar for
the imports they often need in winter months.
In its letter to congressional delegates, PGE says it will contact FERC "and
suggest ideas on how the Western energy scenario can be improved but without
unfairly transferring these problems to PGE's customers."
In addition, Miller expects developers who have announced plans to build
power plants may pull away because prices no longer justify the investment.
PGE, Miller said, may scrap two small projects capable of adding about 70
megawatts to the electricity grid.
Debating benefits
When federal regulators issued their order, they said the entire West would
soon feel the benefits of more stable prices.
"The commission's goal remains to fix dysfunctional markets and to ensure
that markets regain their competitive footing as quickly as possible," said
Curt Hebert Jr., chairman of the Federal Energy Regulatory Commission'
Responses from other utility officials in the Northwest varied, but none
predicted an easing of rates for consumers.
"We have a mixed reaction to it," said Mark Crisson, Tacoma Power's director
of utilities. "At least they finally did something, but, at this point, it's
too little too late."
Tacoma Power, a municipal utility, was among the first to feel the hit of
high electricity prices, which began their infamous rise in May 2000. Caught
short of electricity as dry weather depleted water needed for hydro-powered
generators, Tacoma rushed to the short term, or "spot" market to cover
customer demand. On one memorable December day, after colder temperatures set
in, it paid almost $3,000 a megawatt-hour, 100 times the usual rate.
Six months ago, the utility raised rates by 50 percent on average, said Mike
Crisson, Tacoma Power's director of utilities. At the same time, it pushed
for price caps but got nowhere.
"We needed them right away," Crisson said. "Here we are, six months later and
they're half-measures."
In the meantime, Tacoma Power, reduced its dependence on the spot market by
locking in long-term contracts, Crisson said.
Other utilities in the region took similar action.
"We're pretty much protected," said Neil Neroutsos, a spokesman for Snohomish
County People's Utility District, Washington's second largest utility.
Seattle City Light, governed and operated by the city, is Washington's
largest utility.
Snohomish raised its rates by 35 percent Jan. 1.
Eugene Water and Electric Board locked in some longer-term contracts to
reduce its reliance on the wholesale market and could actually lose money on
the strategy. If the utility ends up with a surplus and has to sell the extra
power on the market, the caps could make the transactions money-losers, said
Scott Spettel, the utility's power and planning manager.
Even so, Spettel expects the price controls to help more than hurt.
"All in all, lower prices are good for consumers," he said.
Waiting on BPA
Many Northwest utilities, particularly ones that are government-. or
member-owned, rely heavily on Bonneville Power Administration for electricity
and haven't yet heard whether the federal caps will affect new BPA rates to
take effect Oct. 1.
BPA, a federal agency based in Portland, markets almost half the electricity
consumed in the Northwest. It will announce its new rates, which could jump
by more than 75 percent, late this week.
"The order's fairly complex," said Steve Oliver, vice president of bulk power
for BPA. "We're still taking a look."
This summer, BPA will neither buy nor sell much power on the spot market and,
therefore, rarely will deal with the price limits.
Another factor dulling the effect of the regulatory action is the market
itself. Earlier this year, spot prices routinely hit $200 to $300 a
megawatt-hour. They recently dropped to below $100 a megawatt- hour and have
stayed below triple-digit territory.
The weeks ahead likely will put the caps to the test. When hot summer days
sweep through California, spot prices are expected to rise as rapidly as the
mercury.
Energy experts project that Federal Energy Regulatory Commission'sprice
limits will hold prices to about $130 to $150 a megawatt hour. The
projections assume natural gas prices don't spike again.
You can reach Gail Kinsey Hill at 503-221-8590 or by e-mail at
gailhill@news.oregonian.com.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

India: Calcutta HC rejects EMC plea

06/24/2001
Business Line (The Hindu)
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) -
Asia Intelligence Wire

KOLKATA: Mr Justice Prabir Kumar Samanta of the Calcutta High Court rejected
the petition of Electrical Manufacturing Co Ltd (EMC) seeking a directive
from the court to strike down an order of the lower court.
A Civil Judge (Senior Division) of the Sealdah Court vacated an ad-interim
order relating to repayment of loan granted by Enron India Pvt Ltd to EMC to
the tune of Rs 6 crore for constructing a transmission line under the
Maharashtra State Electricity Board.
- Our Bureaus

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

India: DPC lenders unhappy with S&W report

06/23/2001
Business Line (The Hindu)
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) -
Asia Intelligence Wire

MUMBAI, June 22. LENDERS to Dabhol Power Company have asked the engineering
consultant, Stone and Webster (S&W), to rework its report on the cost
implications of mothballing the Dabhol power project.
The lenders were not happy with the consultants for having delayed the
report, it is learnt. Also, the costs were not ratified by Enron.
They have reportedly written to S&W asking it to have a relook at the options
available and rework the figures.
According to sources, the lenders were not satisfied with the costs of
various options worked out by the consultant. Lenders are still deliberating
on a remedy that could be best in the current situation.
According to some reports, S&W had estimated the cost of completing the
project at around $400 million. However, the figure could not be confirmed.
The consultant was mandated to compute the cost of three alternatives -
suspend the project as it stands now without any penalties, mothball the
incomplete project, or complete the project with lenders' funds and then
mothball it. At present, 92 per cent of the project is complete.
The termination of the agreements by construction contractors had almost
ruled out the first option. However, the lenders reportedly were not happy
with Enron too for "contributing" to the delay.
The sources say there is also a possibility that Enron may try to persuade
the contractors to reconsider their decision as the lenders are open to all
options.
Lenders feel that if the consultant had given a thorough report on time, some
arrangement could have been chalked out. S&W was supposed to complete the
report in a week from June 7. That would have enabled the lenders to reach a
concrete decision on funding the rest of the project. Indian lenders have not
met or formally discussed the issue after the Singapore meeting on June 5 and
6.
- Dinesh Narayanan

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

Enron CEO gets pie in face

06/23/2001
Press Trust of India Limited
(c) 2001 PTI Ltd.

Washington, June 22 (PTI) Enron Chief Executive Officer Jeffrey Skilling was
hit on the head with a pie as he defended energy companies against the
criticism that they created an energy shortage and profiteered from it during
a speech at the Commonwealth Club of California.
Skilling wiped the pie, which had been heaved by activist Francine Cavanaugh,
and carried on with the speech. Cavanaugh was detained but not arrested.
US Senate candidate and consumer activist Medea Benjamin said Cavanaugh was
from an international pie-throwing group called the Biotic Baking Brigade.
The group has thrown pies at several notable figures, including Microsoft
co-founder Bill Gates and Mayor Willie Brown.
Enron has come under fire after accusations from Californian Governor Gray
Davis and State officials for allegedly forcing electricity prices skyward by
holding back supply.
Enron and other companies have denied such charges. They claim that the State
and State-based utilities owe them billions in unpaid bills.
(THROUGH ASIA PULSE) 23-06 2001

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

EDITORIAL
POWER POLLUTION NO LAUGHING MATTER

06/23/2001
South Florida Sun-Sentinel
Broward Metro
14A
(Copyright 2001 by the Sun-Sentinel)

Mr. Lowe's cartoon on the very important issue of power plants was very
irresponsible and played only for laughs.
Anyone in his right mind would not place three power plants, two of which
will burn dirty diesel fuel (Enron's), in an urban area, within two miles of
each other.
There are hospitals, schools, homes, community centers, nursing homes, etc.,
under the shadow of a combined seven 80-foot smokestacks spewing out their
poison.
There are much better options: such as cleaner plants spread out over a much
larger area. Florida Power & Light and the Broward County Commission have
stated that Florida has enough power for the next 10 years. A moratorium
hopefully will be put in place for one year to wait for the 20/20 study. What
is the rush? Is it because Enron, a megabusiness along with their strong
political presence (the White House and governor's mansions) has a complete
disregard for the people?
Maybe the next very funny cartoon by Lowe will be a few babies choking while
the smokestacks are burning. Humor is important, but let him know the facts
before he uses his barbs.
Ann Mantell
Coconut Creek

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

San Francisco Tourists Just Roll with the Outages
Jasmine Kripalani

06/23/2001
KRTBN Knight-Ridder Tribune Business News: Contra Costa Times - Walnut Creek,
California
Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News; Source: World
Reporter (TM)

SAN FRANCISCO--Tourists are constantly asking the gift shop manager at Coit
Tower if a blackout could occur while they ride the elevator to the top of
the 210-foot fire hose nozzle-shaped landmark.
"They're serious when they ask it. I always tell 'em, `We got the last guy
out in only three days,'" said Walt Lo.
Tour guides, hotel managers and gift shop clerks in the Bay Area have
developed a sense of humor about the California energy crisis. But for many
visitors the perception of blackouts conjures up images of streets without
traffic lights and people trapped in elevators.
Before leaving their Indiana suburb for vacation, Mike and Lisa Bonahoom
worried about what was ahead, but not enough to stop them from booking a
three-night stay at the room designed by former Grateful Dead frontman Jerry
Garcia in the Hotel Triton.
"The perception in the Midwest is that (Californians) don't have lights,"
said Mike Bonahoom.
Lisa, added: "We heard news reports that they shut the lights off every day
(at a set time) in order to save electricity, and people would plan their day
around that I worried about getting stuck in an elevator for hours, but I
didn't mention any of this to the kids."
It's a fear California's travel and tourism commission is taking so seriously
that it has handed a public relations firm about a half-million dollars to
plan an advertising campaign that will convince the rest of the world that
it's still safe to travel to the Golden State.
Communications director Fred Sater blames visitors' fears on the media's use
of the term "rolling blackout."
"`Planned outage' or `power interruption' -- that's the correct phrase," he
said. Sater believes "rolling blackout" inaccurately implies long periods of
darkness across the state.
The San Francisco visitors bureau has taken a less expensive approach. It has
posted a letter and Frequently Asked Questions list on its Web site
(www.sfvisitor.org) that assures potential visitors that emergency services
are still available and that they won't get stuck on an amusement park ride.
But all the warnings in the world wouldn't have done much good on Thursday at
about 1:10 p.m. when the lights in parts of San Francisco flickered, then
went out for about an hour.
Pacific Gas & Electric said 7,000 of its customers were without power and
attributed it to a bad cable between Broadway and Vallejo on Mason Street.
One of those customers included a souvenir shop near Fisherman's Wharf.
Kathy Joy had to wait several minutes before she could complete a sweatshirt
purchase. The cashier rushed to the front of the store with her solar-powered
calculator in hand and returned with a total.
"That'll be $19.90," Sharon Stevenson told Joy and added that she could only
accept cash. Joy had the cash.
Other stores, many of which mistook the outage for a blackout, were forced to
shut down their businesses.
Sean Farber, a sales manager at Studio 39, a video-making business in which a
person's body is transposed on a backdrop of the Golden Gate Bridge, took
advantage of the power outage to express his political viewpoint by posting a
sign that read: "Thanks to PG&E, Enron, and George W Bush We will be closed
until 3:00."
Others saw the outage as an entrepreneurial opportunity.
"Hey, folks, there's a rolling blackout. You might as well go on a Bay
cruise," a tour operator loudly offered.
Many didn't even notice the hourlong power outage.
Two visitors from Naples, Fla., who were in town for the NASCAR races,
noticed the darkened businesses only after a reporter pointed it out.
"Well, if this means I can't get into the pub, I will be very upset," said
Craig Barrero, who was clad in shorts and toting a video recorder.
Other tourists said the only time the energy crisis has affected them is when
they're ready to check out of their hotel room.
When Robyn and Ben Reeve from Australia walked into their room at the Hilton
on Fisherman's Wharf, they found the usual amenities: tightly tucked linens
between mattresses and the bathroom towels symmetrically draped over a brass
bar.
The Reeves also found a letter from the general manager informing them that
they would have to pay a $2.85 energy tax per night.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.

El Paso Awaits Decision as Generators Prepare to Face Lawsuits
2001-06-23 11:56 (New York)

El Paso Awaits Decision as Generators Prepare to Face Lawsuits

     (For more on California's energy crisis, see {EXTRA <GO>}

     Washington, June 23 (Bloomberg) -- El Paso Corp., the owner
of the biggest network of interstate natural-gas pipelines, is the
first company to face a public hearing on charges of manipulating
California energy prices. It likely won't be the last.
     U.S. Administrative Law Judge Curtis Wagner is to decide by
Sept. 24 on allegations that El Paso held natural gas off the
California market to boost prices. The U.S. Federal Energy
Regulatory Commission can accept or reject Wagoner's ruling.
     The case was brought by the state's two biggest utilities and
the California Public Utilities Commission, which also is working
with state Attorney General Bill Lockyer on a civil lawsuit
against power producers. Lockyer plans to convene a grand jury
next month to investigate claims that the generators withheld
electricity to drive up prices.
     ``You're getting the attorney general and the CPUC looking at
potentially going into court,'' said Mark Easterbrook, an analyst
with Dain Rauscher Wessels. ``Investors just don't want to deal
with this uncertainty.''
     The Standard & Poor's Utilities Index, whose members include
generators Mirant Corp., Duke Energy Corp. and Reliant Energy
Inc., has fallen 8 percent in the past month. The S&P Natural Gas
Distributors & Pipe Lines Index has dropped 17 percent. It
includes El Paso and energy traders Enron Corp., Dynegy Inc. and
Williams Cos.
     California's electricity prices rose more than ninefold in
the first quarter from a year earlier, and state officials
forecast that shortages during hot weather may bring as many as 30
days of blackouts through August.
     Generators have repeatedly said they didn't break the law,
blaming high prices on rising demand and a lack of new supply. No
major power plants have been built for a decade in California.
     ``These investigations are built around some sort of odd
theory of market manipulation, and we did absolutely no such
thing,'' Mirant spokesman Chuck Griffin said. ``Our dealings have
been above-board and according to the rules that were established
before we were even in the market.''

                           Common Theme

     Both El Paso and the generators are accused of withholding
supplies to drive up prices. Lockyer says power companies held
back electricity under the guise of routine plant maintenance,
forcing utilities to pay soaring prices for megawatts that
remained on the market.
     The El Paso case stems from the Houston-based company's sale
of California-bound pipeline capacity to its merchant-energy unit.
Plaintiffs allege the El Paso unit withheld the billion cubic feet
of space to drive up natural-gas prices in California. Gas is used
to fuel many of the state's power plants.
     FERC economists testified on behalf of the CPUC and the
utilities, PG&E Corp.'s Pacific Gas & Electric and Edison
International's Southern California Edison. California gas prices
ranged from $11.79 to $18.80 per thousand cubic feet by December,
compared to $4 to $7 elsewhere in the U.S., a FERC study showed.
     ``At least part of the FERC staff took seriously the idea
that a firm could establish market power and raise prices,'' said
Severin Borenstein, director of the University of California's
Energy Institute, who isn't involved in the El Paso trial.

                            Gas Prices

     El Paso argues that gas prices surged because the state's
electricity shortage spurred generators to run their plants almost
nonstop, and utilities' credit risk increased as they ran out of
cash buying power at soaring prices.
     Judge Wagner finished hearing testimony this week on the
market-manipulation charge. He is now investigating claims that El
Paso's merchant-energy unit unfairly won the 15-month pipeline
contract.
     Whatever the outcome, the hearings may educate California
investigators about energy trading. State deregulation of energy
markets has boosted profits for trading companies that buy and
sell electricity and natural gas.
     ``California is learning how to understand the energy
markets,'' said Michael Aguirre, a former prosecutor handling two
lawsuits against power companies, one for California Lieutenant
Governor Cruz Bustamante. ``The learning curve has been a very
steep one.''

Alleged Power Overcharges May Be Less Than Calif Argues
By Jason Leopold

06/22/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

OF DOW JONES NEWSWIRES
LOS ANGELES -(Dow Jones)- Nearly every energy company, including municipal
utilities, that has the ability to supply California with electricity has
allegedly overcharged the state tens millions of dollars over the course of a
year, according to the state's power grid operator.
But the $9 billion total in alleged overcharges detailed by Gov. Gray Davis
to the U.S. Congress this week may have been overstated by more than $2
billion, according to documents obtained by Dow Jones Newswires.
Generators whose wholesale power prices are regulated by the Federal Energy
Regulatory Commission, or FERC, allegedly overcharged the state $2.1 billion
from May to September 2000 and $2.6 billion between October and February,
according to the ISO. FERC can order refunds only from October onward because
of a federal law that requires a filing for refunds to be made within 60 days
of the purchases, according to FERC. The ISO began appealing for refunds in
December, claiming the alleged overcharges were a result of market power, or
the ability to boost wholesale prices above competitive levels.
However, a $1 billion alleged overcharge by Sempra Energy Trading Corp. and
San Diego Gas & Electric, both units of Sempra Energy (SRE), was deleted by
the ISO, according to the documents. The ISO wouldn't explain the reason it
erased the company's alleged overcharge.
Generators said Davis's numbers "didn't add up" and maintained that they
didn't overcharge the state.
The ISO said it planned to recalculate the figures but the agency didn't
discredit Davis's refund estimate.
Some of the numbers calculated by the ISO are much higher than the companies'
entire earnings for 2000, according to earnings statements.
Energy companies with the largest overcharges between May 2000 and February,
as alleged by the ISO:
British Columbia Power Exchange Corp.: $439 million
Aquila Inc. (ILA): $48 million
Automated Power Exchange: $16 million
Calpine Corp. (CPN): $236 million
Coral Power LLC: $27 million
Duke Energy Corp. (DUK): $804 million
Electric Clearinghouse Inc. (DYN): $530 million
Enron Corp. (ENE): $39 million
El Paso Corp. (EPG) : $29 million
Idaho Power (IDA): $28 million
Portland General Electric: $44 million
Puget Sound Energy: $24 million
Reliant Energy Inc. (REI) $750 million
Mirant Corp. (MIR), formerly Southern Co., $753 million
Sempra Energy Trading Corp. (SRE): $82 million (this number has been
eliminated by the ISO)
Williams Cos. (WMB) $860 million
-By Jason Leopold, Dow Jones Newswires; 323-658-3874;
jason.leopold@dowjones.com

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.


Gerald, pls re-issue as index minus $ .95 US/mmbtu.

I will review the rest later... By the way, do you think that the conditions
precedent language is relevent still, or should we strike it..?

 -----Original Message-----
From:  Nemec, Gerald
Sent: Monday, May 21, 2001 12:47 PM
To: Tycholiz, Barry
Subject: New Sierra Confirm

Per your request, please see the attached.

 << File: SierraPowerTA No3.doc >>


Drop the first comma in the first sentence of the third paragraph.  Otherwise
good to go.

	Mark Frevert/ENRON@enronXgate
	Sent by: Nicki Daw/ENRON@enronXgate
	03/16/2001 08:42 AM

		 To: Steven J Kean/NA/Enron@Enron, Greg Whalley/HOU/ECT@ECT, David W
Delainey/HOU/EES@EES, Dan Leff/HOU/EES@EES
		 cc: Maureen McVicker/NA/Enron@Enron, Liz M Taylor/HOU/ECT@ECT, Kay
Chapman/HOU/EES@EES, Kathy Dodgen/HOU/EES@EES, Barbara
Hooks/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt, Keith Dodson/NA/Enron@ENRON, Brian
Stanley/EU/Enron@ENRON
		 Subject: DEnron Engineering and Operational Services - DRAFT Announcement

Please find attached draft announcement for your review and comment.

I would like to release this on Monday (March 19th).

Thanks

Mark


Maybe I'll host a Brown-Bag Lunch Info Session for the
Enron IT Department on basic file recovery techniques.

 - Pastoria Due Diligence Index 101100.doc
 - Pastoria Due Diligence Index.doc
 - Wheatland Due Diligence Index.doc


fyi.

-----Original Message-----
From: Maria.Anzilotti@dynegy.com [mailto:Maria.Anzilotti@dynegy.com]
Sent: Wednesday, January 09, 2002 7:48 PM
To: Hotte, Steve
Cc: Barbara.Miller@dynegy.com
Subject: IT Due Diligence Requests

Steve,

I attached a due diligence list to give you a heads up on some of the items
I will need to review.  I saw what you had on your overview list for Friday
and it looks good.  Whatever we don't cover on Friday, we'll schedule
follow-up meetings on.  Thanks.

Maria E. Anzilotti
Senior Vice President
Enterprise Technology
Dynegy Inc.
Phone:  713-507-6478
e-mail:  maria.anzilotti@dynegy.com

IT Due Diligence List:

   List of all business applications associated with the various pipeline
   functions.  Identify in-house versus third party packages.  If
   third-party, specify release/version information, copies of contract and
   maintenance agreements.

   List of all administrative/corporate systems providing pipeline services
   (e.g.  SAP).

   Blueprint/topology of infrastructure to support pipeline systems
   (excluding administrative/corporate systems).  Include ownership of
   hardware as well as any spare parts inventory, and contract and
   maintenance agreements.

   Prepare to discuss data center facilities involved in pipeline
   operations.  Specifically, provide layouts and usage of Ardmore
   facility.

   Document desktop requirements

   List all third party technical services, including internet, EDI,
   contractor services.

   Prepare an overview of tools,  policies, and procedures involved in
   securing pipeline technology.  Include network, desktop, applications,
   firewall, and web security processes.

   Provide information regarding general expense and approved capital
   budgets.  Include a list of capital projects in-flight for NNG.  Also,
   require data points regarding allocations and direct billings for NNG
   technical services from ETS and other Enron entities providing pipeline
   services.  Prepare an overview of financial tracking process for
   technology spend.

   Provide organizational information regarding technology resources to
   support NNG, both dedicated and shared.


Wade/Rob/Bruce:

I think we should reconfigure the MOU to constitute a binding obligation to purchase and sell rather than a MOU that would lead to a definitive agreement.  We are trying to force an answer, it seems to me at this stage of the game, a definitive offer should be put forward for acceptance or rejection.

Thoughts?

Jim

 -----Original Message-----
From: 	Cline, Wade
Sent:	Monday, November 19, 2001 12:17 PM
To:	Hughes, James A.; Walls Jr., Rob; Lundstrom, Bruce; Dutt, Ranabir; dcsturme@ben.bechtel.com; richard.allison@gecapital.com; pnagarva@ben.bechtel.com; Gurunath, Mohan; Kraske, Paul; Mathis, Robert
Subject:	Draft MOU regarding equity sale

Attached is most recent draft of MOU regarding equity sale of DPC.


Vince,

I thought you might be interested in this too...
We have had several meetings with UH up until now and things are progressing
nicely.
Rice U will follow in mid January and after that, Uof Co at Boulder and
Chicago will follow too.

Per Mark Tawney's request, I am going to include you in another message
following this.  Don Kouri from UH will be visiting soon.  The purpose of
that discussion will be his area of research - more details in the next
message on that - and a seminar we'd like to set up and include your folks
too...

Yannis
----- Forwarded by Yannis Tzamouranis/HOU/ECT on 12/11/2000 03:37 PM -----

	Yannis Tzamouranis
	12/11/2000 03:18 PM

		 To: Mark Tawney/HOU/ECT@ECT, Gary Taylor/HOU/ECT@ECT, D Todd
Hall/HOU/ECT@ECT, Yannis Tzamouranis/HOU/ECT@ECT, Steven Vu/HOU/ECT@ECT,
Joseph Hrgovcic/HOU/ECT@ECT, Brando Hayden/HOU/ECT@ect, Michael
Nguyen/HOU/ECT@ECT, Rajib Saha/HOU/ECT@ECT, Valter Stoiani/Corp/Enron@ENRON,
Timothy M Norton/HOU/ECT@ECT, Todd Kimberlain/NA/Enron@Enron, Reno
Casimir/NA/Enron@ENRON, Seth Hurwitz/Corp/Enron@Enron, Brian
Harper/NA/Enron@ENRON, Salisha Ramos/NA/Enron@Enron, Betty J
Coneway/HOU/ECT@ECT, Gray Calvert/NA/Enron@Enron
		 cc:
		 Subject: Compendium of Research issues

Folks,

in view of our upcoming collaboration with educational & research
institutions, I am putting together a compendium of problem statements within
various research domains.  This list will be used to solicit the interest of
researchers and graduate students who would then work under our supervision.

While the details of how this effort will be organized are still largely up
in the air (list of financial institutions, reporting structure, financial
considerations, confidentiality agreements, exchange of seminars and short
courses, etc) we are making an attempt to define our common interests.  Such
areas are:
Econophysical (e.g. market development; how weather expectations shape the
market; etc.)
Product development (e.g. agriculture and weather; solar radiation and
telecommunications, the Jet stream and Airlines; etc.)
Analytical/Mathematical/Simulation efforts (building a MC simulation for any
given problem might fall under here; working with incomplete data sheets/ways
for filling in data holes; etc.)
Purely weather (e.g. a statistical analysis of the long term effects of solar
phenomena on weather would enter this category)

In light of the above and within the next couple of days,I would like to ask
you to provide me with problem statements within these areas that you have an
interest in and which might offer themselves to this kind of collaboration.
At this point, we're brainstorming; we would thus be happy to have even the
sketchiest of ideas and have the weakest of expectations for well formulated
projects.

Looking forward to hearing from you,

Yannis T.


As a registered reader of PMA Online?s Daily Power Report, we are happy to
provide you with a free trial subscription to Restructuring Today until May
4. Please see yesterday?s issue attached. As a paid subscriber you receive
timely news the date of issue.

Restructuring Today has distinctive industry news and analysis which PMA
can?t deliver from the wire services, and at only $487 for over 250 issues
each year, we consider it a bargain.

Act before May 9 to receive $50 off!

Check it out, and if you'd like to subscribe, just give us your name, email
and telephone number, hit "reply" and a subscription agent will contact you.
You can also find a subscription order form on the back page of the
newsletter.

Requires Acrobat Reader 3.1 or higher, available free at:
http://www.adobe.com/prodindex/acrobat/readstep.html#reader

( ) YES, I WANT TO SUBSCRIBE TO RESTRUCTURING TODAY IN PDF FORMAT FOR ONLY
$437/year ($50 of the regular price for subscriptions orders placed before
May 9).

( ) I AM INTERESTED IN A CORPORATE SUBSCRIPTION TO RESTRUCTURING TODAY
(Provide telephone number)

NAME:

EMAIL*:

TELEPHONE:

( ) PLEASE DO NOT SEND ME TRIAL SUBSCRIPTIONS IN THE FUTURE

Thanks for reading!

 - rt010420pma.pdf


Hi Scott,

Do you want to get together a few minutes early tomorrow to discuss
indemnity/LOL, etc?

Kay


Same price as other volume, start date is fine, e-mail me for confirm

 -----Original Message-----
From: 	Dickin, Mark
Sent:	Thursday, July 19, 2001 8:44 AM
To:	Zufferli, John
Subject:	Electricity purchase for Co-op

Hi John,

We have determined that there was a small portion of power that was underhedged for Co-op. Lori Poffenroth has asked me to purchase this to balance our exposure.

EDC buys from ECC:

Quantity: 0.05823 MW
Flat block 7x24 financial fixed price
Start date: July 20, 2001 (or as early as possible), HE 1:00 (MPT)
End date: December 31, 2005 HE 24:00 (MPT)

Please advise me of Price and Start Date.

Thanks. Mark.


The promotional memo came out a couple of hours too late for me to be able to
mention it to you on the phone this afternoon.  Congratulations on your
promotion to Managing Director.  --Sally


Kelly M. Johnson
Enron Corp.
Executive Assistant
Tel: (713) 853-6485
Fax: (713) 853-2534
E-Mail: kelly.johnson@enron.com


Mike,

Just got it this morning. An area to focus on.

Vince

---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 01/21/2000
07:15 AM ---------------------------

webmaster@cera.com on 01/20/2000 04:04:48 PM
To: Vince J Kaminski/HOU/ECT@ECT
cc:
Subject: Briefing Note: Demand Overtakes Hydro in 2000 - CERA Alert

**********************************************************************
CERA Alert:Thu, January 20, 2000
**********************************************************************

Title: Briefing Note: Demand Overtakes Hydro in 2000
Author: Moritzburke, Zenker, Snyder
E-Mail Category: Alert
Product Line: California Energy ,
URL: http://www.cera.com/cfm/track/eprofile.cfm?u=5166&m=1054 ,

Western energy markets are starting the new year with precipitation
conditions that suggest a repeat of 1999's hydroelectric conditions:
near-normal snowpacks in the Pacific Northwest and Canada and low snowpacks
in California. More significantly, even if snowpacks remain high in the
Pacific Northwest, normal demand growth coupled with normal runoff patterns
in the second and third quarters of 2000 would

*  reinforce the likelihood that gas prices will again set the floor for
on-peak power prices

*  keep differentials across western power markets narrow

*  support higher power prices and increase volatility as gas-fired
generation is run more intensively to meet demand in a market with tightening
capacity margins

From 1999 to 2000, natural gas demand will swing upward by nearly 1,200
million cubic feet (MMcf) per day in the third quarter in response to a
return to normal hydroelectric output and demand growth. Gas price increases
will follow from this increased demand. Although differentials between Topock
and the Henry Hub during the third quarter of last year averaged only $0.05
per MMBtu above the Henry Hub price, CERA expects to see differentials this
year averaging around $0.25 per MMBtu above Henry. This stronger western
demand should also narrow differentials between the Henry Hub and the San
Juan Basin, and to a lesser extent, between Henry and the Permian Basin.

Western Snowpack and Hydro Capacity: A Subregional Story
Since the beginning of winter the Pacific Northwest has received normal
precipitation, with greater snowpacks in the northern part of that region
than in the southern part. California currently lags behind historical
precipitation levels at roughly 26 percent of average (see Figure 1). Given
current conditions, it is possible that California will end winter at
below-average hydroelectric conditions.

Western hydroelectric facilities are concentrated in Oregon, Washington, and
British Columbia, which contain over 75 percent (roughly 46,500 megawatts
[MW]) of the Western Systems Coordinating Council's (WSCC's) hydroelectric
capacity, producing 80 percent (roughly 253,500 gigawatt-hours [GWh]) of the
region's total hydroelectric generation in an average year (see Figure 2).
Because of this high concentration of facilities, above-average precipitation
in the Pacific Northwest can help to offset below-average precipitation in
California and other parts of the West, although transfer capabilities limit
the amount of energy exported from those regions.

Power Markets for 2000: Building on 1999 Dynamics
Despite hydroelectric output that was 15 percent higher than average in 1999,
western power prices reflected the cost of gas-fired generation resources
during nearly all periods of the year. This was a greater proportion of the
year than in 1998 even though hydroelectric production in 1998 was only 95
percent of 1999 levels.* CERA expects several factors to strengthen this
dynamic in 2000, assuming normal weather conditions:

*  Western demand growth. Normal weather and economic growth will increase
regional demand by roughly 2 percent in 2000. Growth will be strongest in the
second and third quarters, at 6 percent and 3.5 percent, respectively, adding
9,000 GWh of demand in the second quarter, followed by 6,000 GWh in the third.

*  Return to normal hydroelectric production levels and patterns. Not only
was 1999 hydroelectric production above normal, but 1999 Pacific Northwest
runoff was prolonged by cool weather in the second and third quarters. Normal
runoff dynamics in 2000 would remove roughly 6,500 MW of hydro capacity from
the Pacific Northwest resource stack from the second to the third quarters
(see Figure 3). By contrast, Pacific Northwest hydroelectric capacity was
depleted by an estimated 3,000 MW from the second to the third quarters in
1999 as a result of slower snowpack melt. This provided unseasonably high
hydroelectric availability in the Pacific Northwest through the third and
fourth quarters. The combination of reduced hydroelectric availability in a
normal-weather year in 2000, a shifting of hydroelectric production back to a
second quarter peak, and higher West-wide demand will increase the pull on
nonhydroelectric generation resources (see Figure 4).

*  Energy exports to California. Sustained hydroelectric availability in 1999
in the Pacific Northwest allowed exports from the region to California to
remain strong through the third and fourth quarters, with exports at 150 and
290 percent of normal, respectively. Exports added roughly 1,400 average
megawatts (aMW) above average--and as much as 2,000 aMW in August--to
California's resource base throughout the year. For 2000, CERA expects normal
hydroelectric exports to average roughly 2,000 aMW (total of 17,500 GWh)
during the year and 2,400 aMW (total of 5,300 GWh) in the third quarter (see
Figure 5).

In 2000 the combination of normal load growth, normal spring and summer
weather, and reduced hydroelectric availability will cause capacity margins
to shrink, particularly in California (see Figure 6). The impact on power and
gas prices will be

*  Higher average power prices. Lower average streamflows will diminish the
output of run-of-river hydroelectric facilities during peak summer demand
periods. As runoff dwindles into the summer, production from reservoir-fed
facilities is available for a decreasing period of the on-peak hours. Other
generation resources, particularly gas-fired, will be used to meet demand
during a growing number of shoulder and off-peak hours in 2000. On-peak power
prices will be driven higher by the increased use of gas-fired generation
during shoulder hours. Off-peak power prices will respond to the greater
reliance on gas-fired generation during those hours.

*  Higher average gas prices. Gas demand for power generation is expected to
increase by 600 MMcf per day on average in 2000 and by up to 1,200 MMcf per
day in the third quarter. This will contribute to price strength in western
gas markets and to the higher costs of generating power.

Natural Gas Market
Although the effects of a return to normal hydro conditions become most
evident in the third quarter as overall generation loads increase, CERA
expects that some decline in hydroelectric output relative to last year is
already causing a modest increase in gas demand in California. Although
January West Coast weather has been comparable to last year, flows into
California are up by 300 MMcf per day so far this month; storage withdrawals
are up on a year-over-year basis as well. Based on the lower snowpack and
lower average precipitation in California this month relative to last
January, in-state hydroelectric generation explains approximately 400 MMcf
per day of increased gas demand.

Normal hydroelectric generation this year will likely bring a 250 MMcf per
day increase in western gas demand for power generation during the first
quarter. Early indications of normal-to-above-normal snowpack and
precipitation in the Pacific Northwest should center these increases in
California.

This modest demand increase has helped support prices in the western markets,
with regional weather differences contributing to western strength as well.
Weather in both the United States as whole and the West averaged 10 percent
warmer than normal during December, but during January temperatures in the
West averaged only 8 percent warmer than normal while temperatures in the
United States averaged 30 percent below normal.

Western Regional Prices
Over the next two months as seasonal heating loads within the West begin to
tail off and hydroelectric generation increases modestly, differentials
between western producing basins and the Henry Hub should widen. At the same
time, as required flows into California decline, the Topock premium above
Henry Hub prices should decline, with prices eventually falling below the Hub
price. However, with normal weather in the West, that general weakening in
western prices will likely take place toward the end of February and into
March. Given the warm January, CERA expects heating load to decline by only
400 MMcf per during February. Loads look sufficient to sustain western
differentials near current levels.

California
As more normal winter weather takes hold in the East, prices should increase
in that market relative to California. So far this month, strong flows into
the state have held Topock differentials around $0.10 per MMBtu relative to
the Henry Hub. During February flows into the state are expected to decline
somewhat as heating demand begins to decline. Table 1 shows expected flows
into California for winter 1999/2000 compared with winter 1998/1999. That
weakening in the Topock differential is limited, however. Expected lower
storage inventories in California relative to last year, as well as a low
upside to eastern prices, should keep Topock prices from falling more than
$0.05 per MMBtu below the Henry Hub during February. Topock prices are
expected to maintain a $0.03 per MMBtu premium to the Henry Hub price (see
Table 2).

Pacific Northwest
Although some cold weather in the Pacific Northwest has held Malin prices
close to Topock prices during January, CERA expects the Malin price to weaken
relative to Topock during February--and more dramatically in March. Two
factors are expected to contribute to this weakening:

*  Hydroelectric output. Although February will bring a decline in heating
load in both the Pacific Northwest and California regions, gas will receive
some support from decreased hydroelectric generation relative to last year in
California. In the Pacific Northwest gas demand is limited during spring even
in normal hydroelectric generation conditions.

*  Canadian flows. Flows to the West Coast on Pacific Gas Transmission during
the first quarter of 1999 dropped from an average of 2.6 Bcf per day during
1998 to 2.4 Bcf per day as Canadian supplies headed into the Midwest on the
Northern Border expansion. This year, given the year-over-year increase in
Canadian supply, those flows into the Pacific Northwest should rebound to
1998 levels.

The Topock-Malin differential so far this month has averaged only $0.06 per
MMBtu. During the first quarter of 1999, that differential averaged $0.09 per
MMBtu. Because of the forces described above, CERA expects a wider
differential--$0.13 per MMBtu--this February.

Rocky Mountains
Similar forces will drive a widening in Rocky Mountain prices relative to
prices in the south. Regional Rockies supplies are likely to increase as
regional demand declines--although warm January weather will limit declines
to 100 MMcf per day during February. The decline in heating load in the
Pacific Northwest, with continued strong Canadian imports, will allow
increased exports from the Pacific Northwest into the Rocky Mountain region
on Northwest pipeline--similar to 1998 conditions. Within the Rockies, supply
builds continue in the Powder River Basin; the new Fort Union and Thunder
Creek gathering systems are now delivering a total of approximately 100 MMcf
per day into the Rocky Mountain interstate pipeline system. Rockies
differentials to the Henry Hub should average $0.25 per MMBtu during February.

Southwest
As demand declines and supply builds in the Rocky Mountains, CERA expects the
spread between Rocky Mountain and San Juan Basin prices to increase slightly,
but for February, Rockies heating load will likely keep the prices close.
Although the differential between the two basins has averaged $0.03 this
month and held at less than $0.05 during December, a $0.05 per MMBtu spread
appears likely for February. This slight increase marks only the beginning of
a wider divergence. CERA expects the differential between the two basins to
widen to over $0.15 per MMBtu this summer as San Juan prices gain support
from strong demand in California power markets.

**end**

Follow URL for PDF version of this Alert with associated tables and graphics.
Please note: should a link not occur using the above URL, please use the
following:
http://www.cera.com/client/ce/alt/012000_16/ce_alt_012000_16_ab.html

**********************************************************************
This electronic message and attachments, if any, contain information
from Cambridge Energy Research Associates, Inc. (CERA) which is
confidential and may be privileged. Unauthorized disclosure, copying,
distribution or use of the contents of this message or any attachments,
in whole or in part, is strictly prohibited.

Terms of Use: http://eprofile.cera.com/tos.html
Questions/Comments: webmaster@cera.com
Copyright 2000. Cambridge Energy Research Associates


Happy B-day punk!

How old are you now? 30?  Oh well, I guess we will see ya tonight.

I don't think you are at work today but if you are shoot me a line.

-Eric


Just a reminder:  the following QBR has been scheduled for your unit:

 Date:   8/29/00
 Time:   1 pm - 4 pm
 Place:  EB3314
 Topic:  Coal & Emissions QBR

Please contact Kay (3x0643) or Beverly (5x7857) if you have any questions.
Thanks


Hi Louise, John,

Attached are the two requested updates on East Power and East Power Financial deal counts for Oct 19th. Savita sent the requested PowerPoint slides and they should also be in your mailboxes. Just let me know if you have any questions, or need any additional information.

Thanks,

Torrey Moorer
EnronOnline Product Control Group
(713) 853-6218


Pat,

Yes -- I would love to be included on the list for an alternative tour time.

Susan

-----Original Message-----
From: Pat Sorrells [mailto:Executive_Director@periwinklefoundation.org]
Sent: Monday, November 26, 2001 10:55 AM
To: Bailey, Susan
Cc: Kelley Harrell
Subject: RE: Orientation Meeting -- January 14, 2002

Susan,
Thanksgiving was great!  Hope yours was a well?

Thanks for letting us know about Orientation.  Would you be interested in
taking a tour of the new Cancer Center at another time?  I was planning on
setting up an alternative tour time if anyone is interested.  Let me know.
Pat

-----Original Message-----
From: Bailey, Susan [mailto:Susan.Bailey@ENRON.com]
Sent: Monday, November 26, 2001 10:26 AM
To: psorrells@periwinklefoundation.org
Subject: Orientation Meeting -- January 14, 2002

Pat,

Hope you had a lovely Thanksgiving??

Please be advised -- I will be UNABLE to attend the Board Orientation
Meeting.

Regards,
Susan S. Bailey
Senior Legal Specialist
Enron Wholesale Services
Legal Department
1400 Smith Street, Suite 3803A
Houston, Texas 77002
phone: (713) 853-4737
fax: (713) 646-3490
email: susan.bailey@ enron.com

**********************************************************************
This e-mail is the property of Enron Corp. and/or its relevant affiliate and
may contain confidential and privileged material for the sole use of the
intended recipient (s). Any review, use, distribution or disclosure by
others is strictly prohibited. If you are not the intended recipient (or
authorized to receive for the recipient), please contact the sender or reply
to Enron Corp. at enron.messaging.administration@enron.com and delete all
copies of the message. This e-mail (and any attachments hereto) are not
intended to be an offer (or an acceptance) and do not create or evidence a
binding and enforceable contract between Enron Corp. (or any of its
affiliates) and the intended recipient or any other party, and may not be
relied on by anyone as the basis of a contract by estoppel or otherwise.
Thank you.
**********************************************************************


Kay:

Attached please find a revised NDA as per our discussion this morning.  I was
unable to mark this document or generate a red-line, so unfortunately I'm
only able to send you a clean copy.  The version attached is the earlier
version I sent you with the following changes:

1.  Section 2 was revised to delete lenders and to add the last sentence as
per your revisions below.
2.  Section 5 was revised as per your revisions attached below.
3.  Section 6 was revised to clarify that compilations, etc. must contain
info of the receiving Party or a third Party in addition to the Confidential
Information.
4.  Section 10 was revised to provide that confidential information will be
protected for 3 years from the Effective Date.

If the revised NDA is acceptable, I will finalize and have it executed and
then forwarded as per you instructions for execution by i2.

Regards,

Leslie Hansen

	Gillian Johnson@ENRON
	12/04/2000 12:51 PM

		 To: Leslie Hansen/HOU/ECT@ECT
		 cc: Tana Jones/HOU/ECT@ECT, Denis O'Connell/LON/ECT@ECT
		 Subject: i2/enroncredit NDA

Leslie,

Please review i2's comments on their standard NDA as revised by us.  I will
be out of the office for the rest of the week so please call me on my cell
phone at 832-541-4115.

Thanks.

Gillian
---------------------- Forwarded by Gillian Johnson/NA/Enron on 12/04/2000
12:49 PM ---------------------------

Kay_Klafehn@i2.com on 11/30/2000 06:44:53 PM
To: Gillian.Johnson@enron.com
cc: Cam_Reed@i2.com, Shea_Dugger@i2.com, Patty_Arnold@i2.com

Subject: i2/enroncredit NDA

Gillian,
I have reviewed Enroncredit's requested changes to the NDA.  Most are fine.
In response to some, I have added or changed some language.  The only real
significant issue that I could see was the length of the protection period.
The absolute minimum i2 will agree to is 3 years.  Please review my changes
in the attached document.  I would be happy to discuss any of these and can
be reached at the numbers below.
Thanks for your help and your consideration.
K
(See attached file: EnronCredit.com 113000kak.doc)

Kay A. Klafehn
i2 Legal

W.  469.357.7157
M.  214.679.6531
F.   469.357.6566
 - EnronCredit.com 113000kak.doc


Lisa,

I was returning your phone call to Carol St. Clair about the agreement and
deleted the message by mistake before I got to your phone no.  Can you give
me a call at (713) 853-3399.  Thanks!


Notice No. 01-26
January 19, 2001

TO:        ALL NYMEX MEMBERS AND MEMBER FIRMS
ALL NYMEX CLEARING FIRMS
ALL NYMEX OPERATIONS MANAGERS
FROM:     Neal Wolkoff
          Executive Vice President

SUBJECT:     MARGIN RATE CHANGE: FEBRUARY, MARCH, AND APRIL 2001 CONTRACTS
ONLY

Effective Date:    Friday, January 19, 2001 (1:00 p.m.).

Futures Contract:  Henry Hub Natural Gas Futures.

Contract Months: February, March, and April 2001 Contracts Only.

Rate Change:
NYMEX Division Margins for the February and March 2001
Henry Hub Natural Gas Futures Contracts Only

Effective Date:    Friday, January 19, 2001 (1:00 p.m.)

Clearing Member (Maintenance Margin):            Old:  $14,000  New:  $12,000

Member Customer (Initial Margin):                Old:  $15,400  New:  $13,200

Non-Member Customer (Initial Margin):            Old:  $18,900  New:  $16,200

NYMEX Division Margins for the April 2001
Henry Hub Natural Gas Futures Contract Only

Effective Date:    Friday, January 19, 2001 (1:00 p.m.)

Clearing Member (Maintenance Margin):            Old:  $5,000   New:  $6,000

Member Customer (Initial Margin):                Old:  $5,500   New:  $6,600

Non-Member Customer (Initial Margin):            Old:  $6,750   New:  $8,100
 Current systems calculate the margin requirement for spread positions by
first determining the "Scan Risk" and then multiplying the number of spreads
by a rate set by the Exchange.  Scan Risk is determined by netting the
outright margin required for each leg of a spread.  Note the outright margin
level required for the February and March 2001 contracts, the April 2001
contract, and all subsequent contracts differ.  Spreading between differently
margined contracts results in a higher spread margin than between equally
margined contracts.  Below are provided three spread scenarios where the legs
of the spread are margined differently.

Scenario One
A spread consisting of one leg in either the February 2001 or March 2001
contracts and another in the April 2001 contract will have its requirement
(at the clearing member rates) calculated at $8,500 starting on Friday,
January 19, 2001.

Example at Clearing Member Rates
One Long February 2001 or March 2001 NG    (1 x $12,000)   =        $12,000
One Short April 2001 NG                 (1 x $6,000)    =   -     $  6,000
Net Scan Risk                         ($12,000-$6,000) =        $  6,000
Spread Rate                          (1x $2,500)     =   +     $  2,500
Total Requirement                                 =        $  8,500

Scenario Two

A spread consisting of one leg in either the February 2001 or March 2001
contracts and another in any month following the April 2001 contract will
have its requirement (at the clearing member rates) calculated at $9,500
starting on
Friday, January 19, 2001.

Example at Clearing Member Rates
One Long February 2001 or March 2001 NG    (1 x $12,000)   =        $12,000
One Short May 2001 - January 2004 NG       (1 x $5,000)    =   -     $  5,000
Net Scan Risk                         ($12,000-$5,000) =        $  7,000
Spread Rate                          (1x $2,500)     =   +     $  2,500
Total Requirement                                 =        $  9,500

Scenario Three

A spread consisting of one leg in the April 2001 contract and another in any
month following the April 2001 contract will have its requirement (at the
clearing member rates) calculated at $3,500 starting on Friday, January 19,
2001.

Example at Clearing Member Rates

One Long April 2001 NG          (1 x $6,000)    =        $  6,000
One Short May 2001 - January 2004 NG       (1 x $5,000)    =   -     $  5,000
Net Scan Risk                         ($6,000-$5,000)  =        $  1,000
Spread Rate                          (1x $2,500)     =   +     $  2,500
Total Requirement                                 =        $  3,500

Summary of NYMEX Division Margins on Natural Gas Futures Spreads
Scenario One: February or March 2001 Contracts versus the April 2001 Contract
Clearing Member (Maintenance Margin):               $  8,500
Member Customer (Initial Margin):                   $  9,350
Non-Member Customer (Initial Margin):               $11,475
Scenario Two: February or March 2001 Contracts versus Contracts following the
April 2001 Contract
Clearing Member (Maintenance Margin):               $  9,500
Member Customer (Initial Margin):                   $10,450
Non-Member Customer (Initial Margin):               $12,825
Scenario Three: April 2001 Contract versus Contracts following the April 2001
Contract
Clearing Member (Maintenance Margin):               $  3,500
Member Customer (Initial Margin):                   $  3,850
Non-Member Customer (Initial Margin):               $  4,725
Should you have any questions regarding these changes, please contact Arthur
McCoy at (212) 299-2928 or Joe Sanguedolce at (212) 299-2855.  This notice
supersedes all previous notices regarding outright margins for the NYMEX
Henry Hub Natural Gas Futures Contract.

__________________________________________________
Please click on the link below to indicate you have received this
email.

"http://208.206.41.61/email/email_log.cfm?useremail=sara.shackleton@enron.com&
refdoc=(01-26)"

Note: If you click on the above line and nothing happens, please copy
the text between the quotes, open your internet browser,
paste it into the web site address and press Return.


The meeting referenced below has been postponed until 3:00pm Eastern /
12:00pm Pacific on Friday, December 15th.
---------------------- Forwarded by Lysa Akin/PDX/ECT on 12/14/2000 11:34 AM
---------------------------

Lysa Akin
12/13/2000 09:07 AM
To: Lysa Akin/PDX/ECT@ECT, Tom Alonso/PDX/ECT@ECT, Robert
Anderson/PDX/ECT@ECT, Kathy Axford/PDX/ECT@ECT, Robert Badeer/HOU/ECT@ECT,
Tim Belden/HOU/ECT@ECT, Jody Blackburn/PDX/ECT@ECT, Jesse Bryson/HOU/ECT@ECT,
Jim Buerkle/PDX/ECT@ECT, Jessica Burry/PDX/ECT@ECT, Angela
Cadena/PDX/ECT@ECT, Christopher F Calger/PDX/ECT@ECT, Monika
Causholli/PDX/ECT@ECT, Fran Chang/PDX/ECT@ECT, Andy Chen/PDX/ECT@ECT, Paul
Choi/SF/ECT@ECT, Ed Clark/PDX/ECT@ECT, Stanley Cocke/PDX/ECT@ECT, Chip
Cox/PDX/ECT@ECT, Sean Crandall/PDX/ECT@ECT, Debra Davidson/PDX/ECT@ECT, Smith
L Day/HOU/ECT@ECT, Michael M Driscoll/PDX/ECT@ECT, Heather
Dunton/PDX/ECT@ECT, Caroline Emmert/HOU/ECT@ECT, Michael
Etringer/HOU/ECT@ECT, Mark Fischer/PDX/ECT@ECT, Amy FitzPatrick/PDX/ECT@ECT,
John M Forney/HOU/ECT@ECT, Chris H Foster/HOU/ECT@ECT, Dave
Fuller/PDX/ECT@ECT, Lisa Gang/PDX/ECT@ECT, Jim Gilbert/PDX/ECT@ECT, Winston
Goodbody/HOU/ECT@ECT, Ashok Gurusamy/PDX/ECT@ECT, Mollie
Gustafson/PDX/ECT@ECT, Mark Guzman/PDX/ECT@ECT, Mary Hain/HOU/ECT@ECT, Don
Hammond/PDX/ECT@ECT, Leaf Harasin/PDX/ECT@ECT, Tim Heizenrader/PDX/ECT@ECT,
Carla Hoffman/PDX/ECT@ECT, D Brett Hunsucker/HOU/ECT@ECT, Donna
Johnson/PDX/ECT@ECT, Saji John/HOU/ECT@ECT, Karen E Jones/HOU/ECT@ECT, Paul
Kane/PDX/ECT@ECT, Paul Kaufman/PDX/ECT@ECT, Jan M King/HOU/ECT@ECT, Holli
Krebs/HOU/ECT@ECT, Kristian J Lande/HOU/ECT@ECT, Monica Lande/PDX/ECT@ECT,
Alan Larsen/PDX/ECT@ECT, Elliot Mainzer/PDX/ECT@ECT, Chris
Mallory/PDX/ECT@ECT, John Malowney/HOU/ECT@ECT, Wayne Mays/PDX/ECT@ECT, Mike
McClain/PDX/ECT@ECT, Anna Mehrer/PDX/ECT@ECT, Jeremy Morris/PDX/ECT@ECT, Matt
Motley/PDX/ECT@ECT, Mark Mullen/PDX/ECT@ECT, Susmitha Nalluri/PDX/ECT@ECT,
Kourtney Nelson/PDX/ECT@ECT, Tracy Ngo/PDX/ECT@ECT, Jeffrey Oh/PDX/ECT@ECT,
Murray P O'Neil/HOU/ECT@ECT, Jonalan Page/PDX/ECT@ECT, Lani
Pennington/PDX/ECT@ECT, Todd Perry/PDX/ECT@ECT, Phillip Platter/HOU/ECT@ECT,
David Poston/PDX/ECT@ECT, Mike Purcell/PDX/ECT@ECT, Dale
Rasmussen/HOU/ECT@ECT, Mark Rathbun/PDX/ECT@ECT, Lester Rawson/PDX/ECT@ECT,
Jeff Richter/HOU/ECT@ECT, Donald Robinson/PDX/ECT@ECT, Grace
Rodriguez/PDX/ECT@ECT, Stewart Rosman/HOU/ECT@ECT, Stacy
Runswick/PDX/ECT@ECT, Valarie Sabo/PDX/ECT@ECT, Holden Salisbury/PDX/ECT@ECT,
Julie Sarnowski/HOU/ECT@ECT, Diana Scholtes/HOU/ECT@ECT, Richard
Schweiger/PDX/ECT@ECT, Walter Seaton/PDX/ECT@ECT, Cara Semperger/PDX/ECT@ECT,
John Shackelford/PDX/ECT@ECT, Jeff Shields/PDX/ECT@ECT, Jeff G
Slaughter/PDX/ECT@ECT, Larry Soderquist/HOU/ECT@ECT, Geir
Solberg/PDX/ECT@ECT, Chris Stokley/HOU/ECT@ECT, Mike Swerzbin/HOU/ECT@ECT,
Kate Symes/PDX/ECT@ECT, Jake Thomas/HOU/ECT@ECT, Maria Van
Houten/PDX/ECT@ECT, Frank W Vickers/HOU/ECT@ECT, Kim Ward/HOU/ECT@ECT, Laura
Wente/HOU/ECT@ECT, Teri Whitcomb/PDX/ECT@ECT, Collin Whitehead/PDX/ECT@ECT,
Bill Williams III/PDX/ECT@ECT, Bill Williams/PDX/ECT@ECT, Diana
Willigerod/PDX/ECT@ECT, Greg Wolfe/HOU/ECT@ECT, Christian Yoder/HOU/ECT@ECT,
Alan Comnes/PDX/ECT@ECT, Theresa Villeggiante/PDX/ECT@ECT
cc:
Subject: FERC Meeting Friday, Dec. 15th

We have secured a phone bridge to listen to the special FERC meeting being
held on Friday, Dec. 15th.

I have reserved the Cascade Conference Room for the call.

Please call me Thursday if you have any questions, or see Mary Hain today.

Thank you.

Lysa
x7927


Ava, I was in the office for October 1 - 15th.   Thanks. Lynn

 -----Original Message-----
From: 	Garcia, Ava
Sent:	Monday, October 08, 2001 8:46 AM
To:	Berger, Larry; Blair, Lynn; Bodnar, Michael; Buchanan, John; Kowalke, Terry; Zadow, Raetta; Barry, Patrick; Blair, Jean; Bryan, Randy; Callans, Nancy; Carr, James; Clapper, Karen; Perry, Renee; Porter, Diana; Walden, Shirley; Washington, Kathy; Wilkens, Jerry; Aldinger, William; Collins, Marion; Conklin, Jacob; Coon, Galen; Cooper, Tim; Cramer, James; Howard, Jack; Laferla, Lynda ; Phillips, Mary; Rivers, Cynthia; Adams, Jean; Benningfield, Robert; Forbish, Sherry; Greaney, Chris; Hibbard, Scott; Janzen, Randy; Linhart, Joe; McDaniel, Janet; Scurlock, Debra; Sturr, Kathy; Vaughan, Cara; Woodson, Harry; Giambrone, Laura; Hernandez, Bert; McEvoy, Christine; Miller, Chris L; Minter, Tracy; Mulligan, Amy; Ward, Linda
Subject:	Timesheets

Please turn in your timesheet by Firday October 12th.

Thanks,
Ava

 << File: BlankTimesheet(15).doc >>