You are a little late, but you did remember.  The fact you remembered
at all is pretty good for a guy.  I had a great b-day with Will and
then later his family took me out.  I love being the only girl in
this family.  It sounds like you have been busy.  Anything
interesting going on in your life?  Have you been in town?  Take
care.  Thanks for remembering! I love you bro!!
--
Sharon Snyder
ssnyder@shelton.org


Does EPSA agree that FERC should require all Transmission Providers should agree to an RTO of the FERC's choosing or lose MBR for all affiliates?  That's the other message Lynne should put out.

Jim

 -----Original Message-----
From: 	Novosel, Sarah
Sent:	Monday, November 19, 2001 1:02 PM
To:	Comnes, Alan; Nicolay, Christi L.; Scott, Susan M.; Guerrero, Janel
Cc:	Steffes, James D.; Shapiro, Richard; Robertson, Linda
Subject:	EPSA Paper on Market Based Rates

I sat in on the EPSA call on market based rates on Friday.  As you know, the Commission has on its agenda for tomorrow a new proceeding entitled "Investigation of Terms and Conditions of Public Utility Market-Based Rate Authorizations" (presumably being done under the Commission's section 206 authorization).  EPSA realizes that circulating its paper on market based rates probably does not make sense now that the Commission has noticed this proceeding, but they are prepare a press release for Lynn Church to release if, after seeing what the Commission has in mind, the investigation will apply to all holders of market based rates.  The press release will state that an investigation of the entire industry is overbroad, and (assuming the Commission makes all market based rates subject to refund during the investigation) that a refund obligation will introduce even more uncertainty into the industry than already exists.

I have a call in to EPSA to see if I can get any more details about what the press release will say.  Please let me know if you have any questions or suggestions for the press release.   I'll let everyone know what comes out of the FERC meeting as soon as I find out.

Sarah


Any progress here. Rick


i changed it


When: Occurs every 2 week(s) on Monday effective 7/23/2001 from 12:30 PM to 1:30 PM (GMT-06:00) Central Time (US & Canada).
Where: EB30c2

*~*~*~*~*~*~*~*~*~*


Mike means "Mark Taylor".  Would you please let me know if Mark wants me to
finalize.  Thanks.  ss
---------------------- Forwarded by Sara Shackleton/HOU/ECT on 12/20/99 11:59
AM ---------------------------

Michael Etringer

12/20/99 11:23 AM

To: Marie Heard/HOU/ECT@ECT
cc: Sara Shackleton/HOU/ECT@ECT
Subject: Confirmation for Deseret

Marie,
I have been talking with Sara concerning Deseret and she indicated that I
should contact you if I need short term follow-up on this agreement.
Currently, Phil Tice and David Taylor are in final discussions concerning
certain language within the Annex of this agreement.  Pending resolution of
these issues, I will need to have the confirmation letter to this agreement
modified prior to sending to Deseret.  The current language references a
price of $33.75 per MWh.  This should be replaced with $34.00 in every case.

Please let me know if you have questions.  When Phil and David have come to
final agreement, we will need to e-mail a final copy of the agreement to
Deseret for initial signiture.  We can then follow-up with a Fed Ex copy for
signitures?  Let me know if this is the normal procedure.  We have a deal
pending that I would like to close today if possible.

Mike
503-464-3836


when you're chief of staff, you get all the fun....

	9069761@skytel.com
	05/09/2001 03:34 PM

		 To: Jeff.Dasovich@enron.com
		 cc:
		 Subject:

Reply Message:
Reply from STEVEN KEAN  is No to Jeff.Dasovich@enron.com||give a gray a big
hug for

Original Message:
Jeff.Dasovich@enron.com||give a gray a big hug for me.  best, jeff


The following reports have been waiting for your approval for more than 4 days.  Please review.

Owner: Henry H Quigley
Report Name: Quigley 100301
Days In Mgr. Queue: 14


1. Change the bold in 1. to "for any reason other than an event of Force
Majeure having the effect of rendering customer unable to accept any volumes
at the primary delivery point during the continuation of such event of force
majeure.

2.  in 1 say that demand charges shall not exceed .055.   Also put in there
that we will provide customer with a copy of Koch's transportation invoice to
verify what we are charged for deficient volumes.

3.  Add a sentence at the end of no.1 that says that "Provided that prioir to
Company's incurring those incremental gas transportation and/or gas supply
costs, customer agrees to pay the incremental amount. "   (they want us to
notify them first and have them agree before we schedule the gas to them)

4.   On the contract, in the definition of Force Majeure they want to add
"for any reason including but not limited to operational or economic reasons"


---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 02/12/2001
11:12 AM ---------------------------

Shirley Crenshaw
02/12/2001 09:41 AM
To: ludkam@aol.com
cc: Vince J Kaminski/HOU/ECT@ECT
Subject: Vince's Itinerary 2-12 - 2-14-01

HI Ludmilla:

Here is Vince's itinerary for today through Wednesday.

Have a great day!


---------------------- Forwarded by Kam Keiser/HOU/ECT on 05/07/2001 06:06 PM
---------------------------
From: Sean Riordan/ENRON@enronXgate on 05/07/2001 03:30 PM
To: Kam Keiser/HOU/ECT@ECT
cc:
Subject:

Kam,

    I don't know if they are looking for more people on this floor but a
friend of mine, Juan Araiza, is looking for work after graduating from
Trinity this week.  Please find his resume enclosed.

SPR


Tim, lets not worry about margin at this point - we are trying to get a
handle on headcount and direct expenses/capital charge first.  You will have
your day in court to discuss margin soon.

Regards
Delainey
---------------------- Forwarded by David W Delainey/HOU/ECT on 11/10/2000
12:46 PM ---------------------------

	From:  Tim Belden                           11/10/2000 12:32 PM

To: David W Delainey/HOU/ECT@ECT
cc:
Subject: 2001 Plan

---------------------- Forwarded by Tim Belden/HOU/ECT on 11/10/2000 09:34 AM
---------------------------
From: Tim Belden on 11/10/2000 10:31 AM
To: John J Lavorato/Corp/Enron, Dave Delainey
cc:
Subject: 2001 Plan

I received the 2001 plan that Dave sent up here.  Chris and I talked and are
working through all of the questions that Dave had.  I noticed that the gross
margin plan for west power trading was $170 million.  When you were here I
talked about $100 million total and then you talked me up to $120 million
total with $100 from the trading efforts and $20 from middle
market/services.  Why the change from $120 to $170?  Perhaps it was a
typo?????  While I intend to make as much money as I possibly can next year,
the $170 number seemed high.  Particularly given the regulatory freak show
that is going down in California right now.


BREAKING NEWS from CNN.com

-- U.S. Central Command: Member of U.S. Special Forces killed in hostile fire in Afghanistan.
Watch CNN or log on to http://CNN.com /AOL Keyword: CNN for the latest news.

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CNN Interactive email id:13203135402264058


Avril Forster - (Power Market Report) - Meet at Stacey's Desk EB3102g

Please call if you have any questions.

Thanks,

"Z" (Zionette) Vincent
x54858


I didn't have this email when I left yesterday.

---------------------- Forwarded by Chris Germany/HOU/ECT on 02/23/2000 08:01
AM ---------------------------

"Immer, Ingrid" <Ingrid.Immer@Williams.com> on 02/22/2000 04:09:06 PM
To: Chris Germany/HOU/ECT@ECT, Judy Townsend/HOU/ECT@ECT
cc:
Subject: Enron Name Change

Chris and Judy,
Please pass on to any of your folks who need to know that we've completed
the name change from Enron Cap & Trade to Enron North America.  Your new
business party number is 7973.
Let me know if any problems arise.  Thanks.   ii


Mark Taylor

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Ava, please add Jean Blair to the shift differential for Nov. 1.  It is important that jean is
    working the whole month either 10:00 to 7:00 or Shirley's shift to get the differential.
    Therefore I would not envision Jean being the 6:30 a.m. or 8:30 a.m. person.
    Thanks. Lynn

-----Original Message-----
From: Bryan, Randy
Sent: Monday, October 08, 2001 11:19 AM
To: Blair, Lynn
Cc: Blair, Jean; Bryan, Randy; Callans, Nancy; Washington, Kathy; Barry, Patrick; Wilkens, Jerry; Clapper, Karen; Porter, Diana; Carr, James; Perry, Renee; Walden, Shirley
Subject: RE: North Team Differential Pay

Lynn,
    After further discussion, Jean Blair has volunteered to be the primary back up for Shirley and second evening person.  This will change her shift hours from 10-7 to cover the core evening hours, provide additional support for Shirley, and be able to fill in for Shirley while she is on comp days or vacation.  Will this be acceptable in order for Jean to receive the differential pay for working an evening shift?  Thanks.

-----Original Message-----
From: Bryan, Randy
Sent: Wednesday, August 29, 2001 10:26 AM
To: Blair, Lynn; Kowalke, Terry; Buchanan, John
Cc: Wilkens, Jerry; Callans, Nancy; Washington, Kathy; Clapper, Karen; Porter, Diana; Carr, James; Walden, Shirley; Blair, Jean; Perry, Renee; Bryan, Randy
Subject: North Team Differential Pay

Lynn,
    The team has decided that we only need one primary evening person, which is Shirley Walden.  In the event that Shirley is out of the office, the team will use a rotational schedule between all team members to cover the evening shift.  I have attached a tentative schedule for evening coverage. If you have any questions, please let me know.  Thanks.

Randy Bryan
Market Services Representative
Northern Natural Gas Company
(713) 853-0438


please schedule a round of interviews with john griffith with scott, hunter,
phillip, and tom asap (today if possible).
thx


here's juleanna's take on the nyt quote, fyi.  i wouldn't press them on the
correction.  (and didn't think it would hurt to share her extraneous comment
with my client, either!) best, ed g.

-----Original Message-----
From: Juleanna_R._Glover@ovp.eop.gov
[mailto:Juleanna_R._Glover@ovp.eop.gov]
Sent: Thursday, May 17, 2001 9:02 AM
To: Ed Gillespie
Subject: RE: Friday Evening

i'll make sure the people that matter know the quote was wrong.  no need to
publicly clarify, unless it is mandatory from the client's perspective.

i'd love to see you some day soon, too.  you're really relied upon around
here ... hear your name all the time in connection w. tough issues, but you
know that already.


Attached below is the updated list of potential Japanese customers for
EnronOnline.  Note that column "B" now contains a "legal name" for each
company.  I hope that this will help in reviewing these counterparties.  Once
again, we are shooting for the end of next week to have this review
completed.
Please let me know if there is anything that I can do to help in this process.

Thanks!!!

Frank
---------------------- Forwarded by Frank L Davis/HOU/ECT on 04/05/2000 08:16
AM ---------------------------

Rousseau Anai@ENRON_DEVELOPMENT
04/04/2000 11:53 PM
To: mparraca@enron.com
cc: Frank L Davis@ECT
Subject: Legal Name

Hi guys

I've filled in the formal names for all the potential clients except the
bottom two (which I will get soon).

My guess is that its going to be a very long process for you to run the
credit process over all 110 companies by the time we get this up and running.
Maybe you could start with the trading houses and investment banks which are
likely going to be the counterparties we deal with first.

Could you also inform me of any counterparties that fail the credit process -
I will not send a mailout to companies that fail the test.

Regards
Rousseau


You are awsome!!  Thanks so much!

ds

 -----Original Message-----
From: 	Thompson, Virginia
Sent:	Friday, August 31, 2001 11:55 AM
To:	Scholtes, Diana
Cc:	Crandall, Sean; Chang, Fran
Subject:	Modesto deals

Diana-

  I have put documentation in your box, but here is a summary of the Modesto deals:

Deal Number	Amount 	Date Entered 	Deal Date	Recognized and Pulled thru		PMA Statement Recognition

651899.1	-155,797.90	June-2001	April-2001	July-2001 (this one recognized late)	August-2001 (should have been July 01)
665408.1	-408,800.00	June-2001	May-2001	June-2001				July-2001
651899.2	-  31,134.28	July-2001	May-2001	July-2001				August-2001
693176.1	-504,162.50	July-2001	June-2001	July-2001				August-2001
	          -$1,099,894.68

Total recognized July 2001 PMAs:	($ 408,800.00)
Total recognized August 2001 PMAs:	($ 691,094.68)
				           ($1,099,894.68)

I hope that this helps.

Please let me know if you have any questions.

Virginia


Attached, per your request, you will find the priorities for Mexico this
year.  I still need to do a valuation exercise with the help of mi amigo
Jaime Steffes.

Saludos,

Ricardo


why?  (touchee)

	Paul Kaufman/ENRON@enronXgate
	05/10/2001 01:54 PM

		 To: Janel Guerrero/Corp/Enron@Enron, Richard Shapiro/NA/Enron@Enron, Mark
Palmer/Corp/Enron@ENRON, James D Steffes/NA/Enron@Enron, Linda
Robertson/NA/Enron@ENRON, Ray Alvarez/NA/Enron@ENRON, Daniel
Allegretti/NA/Enron@Enron, Howard Fromer/NA/Enron@Enron, Jeff
Dasovich/NA/Enron@Enron, Susan M Landwehr/NA/Enron@Enron, Karen
Denne/Corp/Enron@ENRON
		 cc: Lora Sullivan/Corp/Enron@ENRON, Ginger Dernehl/NA/Enron@Enron, Linda J
Noske/HOU/ECT@ECT, Terri Miller/NA/Enron@Enron
		 Subject: RE: campaign leadership agenda

I'd like to add a report on the WGA meeting yesterday re:  RTO West and
Transmission.

 -----Original Message-----
From:  Guerrero, Janel
Sent: Thursday, May 10, 2001 9:40 AM
To: Shapiro, Richard; Palmer, Mark; Steffes, James; Robertson, Linda;
Alvarez, Ray; Allegretti, Daniel; Fromer, Howard; Kaufman, Paul; Dasovich,
Jeff; Landwehr, Susan; Denne, Karen
Cc: Sullivan, Lora; Dernehl, Ginger; Noske, Linda; Miller, Terri
Subject: campaign leadership agenda

May 10, 2001
Agenda

California
Update on meetings with Governor Davis
 outlook for solution package
Update on meetings with Chamber/CMA et al
Ending of special session/passage of bonds legislation
CPUC tiered rate increases
ISO update
IEP/DA coalition update
Press update
CA briefing book
Other issues??

Western States
Upcoming meetings/scheduling
Press outreach

New York
FERC adoption of NY ISO rules
Official coalition name: Empire State Energy Suppliers
Registration as non-profit with the state
By laws
Letter of Agreement with the state
Update on development of message
Advertising effort
IPPNY message

Washington, DC
Barton markup
Bush energy plan
FERC update
DOE update
CEO Summitt
Press update
Other issues?

Price Risk Managment
Update

Litigation
Update


Tana,

I have no problems.

Jeff

	Tana Jones
	11/07/2000 08:23 PM

		 To: Alan Aronowitz/HOU/ECT@ECT, Jeffrey T Hodge/HOU/ECT@ECT, Stacy E
Dickson/HOU/ECT@ECT, Leslie Hansen/HOU/ECT@ECT, Shari Stack/HOU/ECT@ECT,
Harry M Collins/HOU/ECT@ECT, David Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT,
Marie Heard/Enron Communications@Enron Communications, Robbi Rossi/Enron
Communications@Enron Communications, John Viverito/Corp/Enron@Enron, Jane
McBride/AP/Enron@Enron, Andrea Calo/SA/Enron@Enron
		 cc: Bradley Diebner/HOU/ECT@ECT, Tom Moran/HOU/ECT@ECT, Edward
Sacks/Corp/Enron@Enron, Karen Lambert/HOU/ECT@ECT, Lisa Lees/HOU/ECT@ECT,
Stephanie Sever/HOU/ECT@ECT
		 Subject: RUSH Approval - ANP Power Marketing Company

The above counterparty should be coming on tonight's list.  We would like to
open them for gas ASAP, and Credit is reviewing the financials now to give
them some headroom on power.  If you could let me know ASAP whether you have
any issues.


Just a heads up from a Business Coalition for Clean Air (BCCA) meeting we had
on Monday to try to raise the proposed $1.6 million for 2001 activities.
(You will hear all about the business plan today.)

The suggested amount for you/Enron is $200,000--12.5% of the total.  Enron
gave $50,000 for the 2000 effort, which was about 8% of the total they ended
up raising ($617,000).   it is your call on what is reasonable, and keep in
mind there might be another round later on.

We have been working on a list of potential donors with "A" being the
impacted such as refiners and petrochemical companies and "B" being
beneficiaries such as contractors.  Ned Holmes office suggested that you pick
the names of the potential donors for the Enron visit and he will just take
the rest.  The list is being updated, so we will have to wait until the
meeting to look at it.

- Rob


UN WIRE
An Independent News Briefing about the United Nations
-------------------------------------------------------
Monday, 16 October, 2000 - http://www.unfoundation.org

Today's UN WIRE Stories

UN AFFAIRS
 1 AWARD: UNHCR Head Receives Seoul Peace Prize
 2 FRAUD: Woman Found Guilty For Spending UN Money

HEALTH
 3 EBOLA: Outbreak Blamed For 35 Deaths In Uganda
 4 HIV/AIDS: Southeast Asian Crisis Could Rival Africa's --
Scientists
 5 HIV/AIDS II: Mbeki Says He Will Withhold Comments
 6 POLIO: African Nations Launch Coordinated Campaign; More

WOMEN, CHILDREN AND POPULATION
 7 WOMEN'S RIGHTS: Global Protests Target Violence, Poverty
 8 RURAL WOMEN: Groups Call For Greater Awareness, Empowerment
 9 CHILD RIGHTS: UNICEF Ambassador Criticizes US

ENVIRONMENT
 10 POLLUTION: Canada, US Announce Smog Reduction Accord
 11 RHINOS: Kenya Boasts Stable, Growing Population

ECONOMICS, TRADE AND DEVELOPMENT
 12 DEBT RELIEF: Poor Countries Need More -- UN Report
 13 LATIN AMERICA: Disparities Widen As Mexico, Chile, Brazil
Grow
 14 INDONESIA: World Bank Concerned About Recovery

HUMANITARIAN AID AND FOOD SECURITY
 15 WORLD FOOD DAY: Little Headway Made Against Hunger -- FAO
 16 SOUTHEAST ASIA: UNHCR Chief Holds Talks With Myanmar; More

HUMAN RIGHTS, JUSTICE AND DEMOCRACY
 17 UN RIGHTS COMMITTEE: 70th Session Opens Today

CRIME, CORRUPTION AND DRUGS
 18 YUGOSLAVIA: UN, UK Police Arrest 25 In Crime Raid
 19 BOLIVIA: UNDCP Pushes Alternative Crops To Replace Coca

PEACEKEEPING AND SECURITY
 20 MIDDLE EAST: Emergency Talks Begin In Egypt; More
 21 CONGO: UN Gives Warring Parties Two Months To Resume Talks

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Begining 6/4/01 most North American Gas and Power quotes will be displayed on and transactable from the TRUEQUOTE trading platform. Please call me if you have any questions or need more information. Thanks.

Savita
X31787


Notice No. 01-64
February 20, 2001

MEMORANDUM

TO:
ALL NYMEX AND COMEX MEMBERS

FROM:
Neal L. Wolkoff, Executive Vice President

DATE:
February 20, 2001

RE:
Implementation of NYMEX Resolution

The purpose of this Notice is to advise Members that an Exchange Resolution,
which is attached, confers upon COMEX Division Members (owners and those
members who hold a seat pursuant to an A-B-C agreement) trading privileges
for the execution of customer orders by open outcry in the Platinum Ring for
the following NYMEX Division contracts: Platinum Futures; Palladium Futures,
Liquefied Propane Gas Futures and Platinum Options.  The Resolution further
provides that such trading privileges are revocable upon 90 days notice by
the Exchange,s Board of Directors.

The Exchange has also made related, conforming amendments to NYMEX Rules
6.43A (&Broker Association Registration Requirements8); 6.44 (&Registration
for Billing of Floor and NYMEX ACCESS7 Brokerage8) and 8.66 (&Billing and
Commissions8).

The new Resolution and the amendments to the NYMEX rules shall become
effective on Wednesday, February 21, 2001.

Please be advised that before a COMEX Member can exercise these trading
privileges, the COMEX Member must first comply with the applicable
requirements for NYMEX Division Floor Members, including training for trading
on the NYMEX floor and obtaining a guarantee from a NYMEX Clearing Member.

If you have any questions, please contact M. Dawn Lowe, Vice President, NYMEX
Membership Department, at (212) 299-2370; George Henderson, Vice President,
NYMEX Floor Dept., at (212) 299-2071; or Suellen Galish, Vice President,
NYMEX Legal Dept., at (212) 299-2215.

 * * * *

RESOLUTION OF THE BOARD OF DIRECTORS TO CONFER ADDITIONAL TRADING PRIVILEGES
TO COMEX MEMBERS FOR PLATINUM, PALLADIUM AND PROPANE

RESOLVED that the COMEX Division Members (owners and those members who hold a
membership pursuant to an A-B-C Agreement) shall be conferred the privilege
to trade Platinum Futures, Palladium Futures, Liquefied Propane Gas Futures
and Platinum Options for customers in the Platinum ring by open-outcry; and

IT IS FURTHER RESOLVED that this trading privilege is revocable upon 90 days
notice by further act of the Board of Directors in its sole discretion.

NYMEX AMENDMENTS TO NYMEX RULE 6.43A

 (Asterisks indicate additions; brackets indicate deletions)

Rule 6.43A BROKER ASSOCIATION REGISTRATION REQUIREMENTS

 (A) The term &broker association8 shall mean two or more Trading Members at
least one of whom is actin as a Floor broker, who: I) engage in floor
brokerage activity on behalf of the same employer; ii) have an employer
relationship which relates to floor brokerage activity; iii) share profits
and losses associated with their floor brokerage or trading activity;; iv)
are officers, directors and/or ten percent (10%) shareholders of the same
corporation which relates to floor brokerage activity; or v) regularly share
a deck of orders.  ** For the purposes of this rule only the terms &Floor
Broker8 and &Trading Member8 shall include COMEX Members who have NYMEX
Division trading privileges. **

[The balance of the rule remains the same.]

Rule 6.44 REGISTRATION FOR BILLING OF FLOOR AND NYMEX ACCESS
  BROKERAGE

Member Firms and Floor Members engaged personally in floor brokerage or
operating brokerage businesses on the Exchange floor are required to register
with the Membership Department, their names and the names of the entities
under which brokerage will be billed, and the names of all persons having
ownership interests in such entities, including the percentage of their
ownership interests, and to provide upon request any supporting information
requested by the Membership Department or the Compliance Department. ** For
the purposes of this rule the terms &Member8, &Member Firm8 and &Floor
Member8 shall include COMEX Members who have NYMEX Division trading
privileges. **

[The balance of the rule remains the same.]

Rule 8.66 BILLING AND COMMISSIONS

(A) Any bill for services rendered on the trading floor or on NYMEX ACESSc
shall be issues in the name of, and as payable to a Member or Member Firm. *
* For the purposes of this rule the terms &Member8 and &Member Firm8 shall
include COMEX Members who have NYMEX Division trading privileges. * *

[The balance of the rule remains the same.]

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

"http://208.206.41.61/email/email_log.cfm?useremail=tana.jones@enron.com&refdo
c=(01-64)"

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.


Greg Whalley
Office #   713-853-5220 - EB3324
Office Fax# 713-853-1838
Home#  713-465-1641
Cell#  713-962-7307

Nyree Jones@ENRON_DEVELOPMENT
03/06/2000 12:27 PM
To: Greg Whalley@ECT
cc:
Subject: GLOBAL ASSETS OPERATION CRISIS CONTACT LIST

HELLO,

I am Nyree Jones and I am working with Don Hawkins and Mike Fuentes and we
are currently updating the crisis contact list.  Will you please provide the
following information about yourself:  OFFICE, FAX, HOME, CELLULAR, AND PAGER
NUMBERS (If applicable).  We appreciate your assistance.

Thank you very much.

Nyree


These are the numbers Smurfit has.

Please look over and approve.

Thanks

Mike P. Purcell
Settlements Coordinator
Volume Management-Portland
503-464-8297


Here's the latest...
---------------------- Forwarded by Kay Mann/Corp/Enron on 12/14/2000 03:47
PM ---------------------------

Scott Laidlaw@ENRON_DEVELOPMENT
12/14/2000 11:46 AM
To: Ben Jacoby/HOU/ECT@ECT
cc: Dan Shultz/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Kay Mann/Corp/Enron@Enron

Subject: westinghouse 501D5A - update

confirming today's calls, westinghouse is asking enron whether we'd consider
the following settlement of the "north america peaker/panama/electrocities"
gtg issue, particularly as it relates to the damaged generator (again, plz
understand that this is not a formal offer at this time; will come within
days depending on our response.  westinghouse does not want to go to their
senior management with a "settlement" offer without knowing that enron will
respond favorably when formally presented; i.e., just a waste of time for all
concerned):

westinghouse will re-imburse enron asap with money's paid to date by enron to
westinghouse.  note - westinghouse is willing to consider taking back the gtg
for what enron paid westinghouse, BUT NO addl monies will be offerred or
considered.  this is a "ceiling."
money to be wired within days of settlement agreement.
westinghouse takes back the unit "as-is."
no further claims/rights of action between the parties on this gtg/contract.
this potential of an offer from westinghouse has a life span of just a few
days (i.e., this week).  westinghouse is "long" on D5A machines and for them
to take this one back into the fold will present them with marketing
challenges in 2001.

pros
brings cash back to enron on the balance sheet before end of year.
we don't currently have a use for this gtg in an enron project.  (i.e.,
unless an idc treatment can be agreed, project's now can't typically afford
this unit).
we don't currently have an anticipated use for this gtg in the next 6 to 9
months in an enron project.
we don't have to pay for storage; i.e., such costs are already accruing.
dispute resolution (per contract) consists of senior management meeting
seeking to settle; if unable, the remedy is the n.y. courts.  therefore, we
can avoid lawsuit.  therefore, we'll save on outside legal costs.
as part of settlement, we can possibly secure an option forward or first
right of refussal on a "f" or "g" machine for projects in 2002.
by settling now, this avoids further month by month increases in idc.

cons
idc costs to be written off by ena (or elsewhere?).

for ben - plz advise.  dan shultz, kay mann (hopefully) and scott laidlaw are
available to meet today on this issue.  regards.  scott.


I got it.  I love you too.

D


Mike:

I regret that we had a difficult call yesterday.   We greatly appreciate the
good work that you do and the commitment you and your firm have to our
company.  Moreover, I recognize that the legislature is a difficult
environment and that there is substantial pressure on you and Sandy.  I also
recognize that needs and demands can change quickly and, at times, our RCR
process can be difficult!

All that said, however, the Government Affairs group has an obligation to use
our internal and external resources in the best and most cost-effective
manner.  The RCR process helps us satisfy that obligation..

From our conversation yesterday and a later call with Sandy, it appears that
there is some confusion on how we will use the RCR process to contract for
legal support for our legislative efforts.  Hopefully this e-mail will
clarify the process so there is no confusion in the future and so that you
can feel comfortable you are undertaking work that is authorized and for
which we have a budget.

1.  To begin, it appears from your e-mail yesterday that Goodin, MacBride has
billings as of May 11 for approximately $10,000 on direct access, windfall
profits, the "Global Settlement," and Power Plant Siting.  With respect to
this work, I recognize that there may have been confusion about our budgeting
and RCR approval process.  These billings will be included in the
RCR-approval requests discussed below.

2As we discussed yesterday, the work associated with the billings in May was
conducted without any RCR approval or any budget in place.  As you know we
terminated the two legislative retainers at the end of April.  No RCRs were
filed to cover the matters on which work was completed in May.

I did receive a budget on legislative matters on May 8.  However, a decision
was made only yesterday to proceed on a specific matter-by-matter basis.  The
work in May should not have been undertaken while we considered whether to
proceed with an overall legislative budget or proceed with specific RCRs.  In
short, the proposed budget was not RCR approval.

In the future, any work undertaken by Goodin MacBride should only be
conducted pursuant to an approved RCR.  If an emergency arises--i.e., an
issue arises that could not have been contemplated, we can get emergency
approval for work necessary to respond to the emergency.   Please contact me
in the event of an emergency.  I can be reached through my office
line--503.464.7945, pager--888.916.2262, or cell phone 503.539.4733.  If I
can't be reached, please contact Jim Steffes.  Jim's pager number is
888.906.9676.  Note that both Jim and I wear the pager at all times and
respond immediately to messages left on the pager.

3.  Pending RCR approval for the matters identified below, I have asked
Goodin MacBride to participate in the Direct Access coalition meetings taking
place today and tomorrow.  In a discussion with Sandy yesterday, I agreed
that Goodin MacBride should participate in a telephonic conference on the
Calderon bill.

4.  To the maximum extent possible, you should include Leslie Lawner in
future Direct Access Coalition meetings, conference calls, legislative
drafting efforts, etc.

5.  If there is any confusion on whether there is RCR approval for a
particular matter, please contact me before undertaking an assignment.  If I
am unavailable, please contact Jim Steffes.

6.  Today, Sandy is filing several RCRs for legislative support on Direct
Access, Siting, Windfalls Profits, and the Global Settlement.  They will be
considered at next Monday's RCR conference call.  If they are approved, Sandy
will manage the Goodin MacBride assignments associated with Direct Access,
Siting, and Windfalls Profits.

7.  Jeff Dasovich will manage all work associated with the Global Settlement,
whether it is legislative or not.  This does not mean that Sandy cannot give
assignments to Goodin MacBride that involve the Global Settlement; it simply
means that before that work begins Jeff must approve the work.

This particular issue is a critical matter for our company.  Jeff is involved
in the strategy and business calls concerning this matter and is working on a
daily basis with Jim Steffes, Rick Shapiro and Steve Kean to develop our
position and advocate that position in the settlement discussions.  We must
ensure that our Sacramento efforts are fully coordinated with our strategy
and business interests (as they develop through the settlement
discussions).   To avoid any confusion on the scope of Jeff's responsibility,
I consider all legislation addressing the Edison MOU, any future MOUs with
Sempra, and "Plan B," to be part of the Global Settlement.

Please contact me if you have any questions regarding any of the above.
Again, we appreciate your hard work and commitment to our efforts.

Paul Kaufman


Call me a "softie," but I couldn't help passing this one on.  Have a great
weekend! SRS :-)

First Important Lesson - Everyone's job is important

During my second month of nursing school, our professor gave us a pop quiz. I
was a conscientious student and had breezed through the questions, until I
read the last one:

"What is the first name of the woman who cleans the school?"

Surely this was some kind of joke. I had seen the cleaning woman several
times. She was tall, dark-haired and in her 50's, but how would I know her
name? I left the question blank.

Just before class ended, one student asked if the last question would count
toward our quiz grade. "Absolutely," said the professor. "In your careers,
you will meet many people. All are significant. They deserve your attention
and care, even if all you do is smile and say 'hello'."

"I've never forgotten that lesson. I also learned her name was Dorothy.

Second Important Lesson - Pickup in the Rain

One night, at 11:30 PM, an older African American woman was standing on the
side of an Alabama highway trying to endure a lashing rain storm. Her car had
broken down and she desperately needed a ride. Soaking wet, she decided to
flag down the next car. A young white man stopped to help her, generally
unheard of in those conflict-filled 1960s.

The man took her to safety, helped her get assistance and put her into a taxi
cab. She seemed to be in a big hurry, but   wrote down his address and
thanked him. Seven days went by and a knock came on the man's door. To his
surprise, a giant  onsole color TV was delivered to his home.

A special note was attached. It read: "Thank you so much for assisting me on
the highway the other night. The rain  drenched not only my clothes, but also
my spirits. Then you came along. Because of you, I was able to make it to my
dying husband's bedside just before he passed away. God bless you for helping
me and unselfishly serving others." Sincerely, Mrs. Nat King Cole.

Third Important Lesson - Always remember those who serve.

In the days when an ice cream sundae cost much less, a 10 year old boy
entered a hotel coffee shop and sat at a table. A waitress put a glass of
water in front of him. "How much is an ice cream sundae?" he asked.

"Fifty cents," replied the waitress.

The little boy pulled his hand out of his pocket and studied the coins in it.
"Well, how much is a plain dish of ice cream?" he inquired.

By now more people were waiting for a table and the waitress was growing
impatient. "Thirty-five cents," she brusquely  replied."

The little boy again counted his coins. "I'll have the plain ice cream," he
said. The waitress brought the ice cream, put the bill on the table and
walked away. The boy finished the ice cream, paid the cashier and left.

When the waitress came back, she began to cry as she wiped down the table.
There, placed neatly beside the empty dish, were two nickels and five pennies
-- You see, he couldn't have the sundae, because he had to have enough left
to leave her a tip.

Fourth Important Lesson - The Obstacle in Our Path

In ancient times, a King had a boulder placed on a roadway. Then he hid
himself and watched to see if anyone would  remove the huge rock.

Some of the king's wealthiest merchants and courtiers came by and simply
walked around it. Many loudly blamed the king for not keeping the roads
clear, but none did anything about getting the stone out of the way.

Then a peasant came along carrying a load of vegetables. Upon approaching the
boulder, the peasant laid down his burden and tried to move the stone to the
side of the road.

After much pushing and straining, he finally succeeded. After the peasant
picked up his load of vegetables, he noticed  a purse lying in the road where
the boulder had been. The purse contained many gold coins ad a note from the
king indicating that the gold was for the person who removed the boulder from
the roadway. The peasant learned what many of us never understand:

Every obstacle presents an opportunity to improve our condition.

Fifth Important Lesson - Giving When it Counts

Many years ago, when I worked as a volunteer at a hospital, I got to know a
little girl named Liz who was suffering from a rare and serious disease. Her
only chance of recovery appeared to be a blood transfusion from her 5-year
old brother, who had miraculously survived the same disease and had developed
the antibodies needed to combat the illness.

The doctor explained the situation to her little brother, and asked the
little boy if he would be willing to give his blood to his sister.

I saw him hesitate for only a moment before taking a deep breath and saying,
"Yes, I'll do it if it will save her."

As the transfusion progressed, he lay in bed next to his sister and smiled,
as we all did, seeing the color returning to her cheeks. Then his face grew
pale and his smile faded. He looked up at the doctor and asked with a
trembling  voice, "Will I start to die right away?"

Being young, the little boy had misunderstood the doctor; he thought he was
going to have to give his sister all of his blood in order to save her.

You see, after all, understanding and attitude, are everything.


Gas Liberalization Turns Volatile For German Utility
The Wall Street Journal Europe, 08/23/01
2 Sides Spend Millions To Generate Support
The Washington Post, 08/23/01
Traders, Old Utilities Tangle Over Wires
The Washington Post, 08/23/01
Relentless Search for Growth Humbles a Mutual Fund Star
The New York Times, 08/23/01
From Maine to N.Y. Way of Atlanta; Trades Light Up States by Long Distance
The Washington Post, 08/23/01
UK: Copper pushes ahead in subdued LME pre-market.
Reuters English News Service, 08/23/01
Papers on Dabhol project not received
The Times of India, 08/23/01
INDIA: ANALYSIS-Poor governance hobbles India's reform drive...
Reuters English News Service, 08/23/01

Politics & Economy
European Notebook
Gas Liberalization Turns Volatile For German Utility
By Philip Shishkin
Staff Reporter

08/23/2001
The Wall Street Journal Europe
2
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Two years ago, the municipal utility in Heidelberg, Germany decided to do something very unusual for European utilities. It went shopping for natural gas.
For more than 40 years, the utility, Stadtwerke Heidelberg, didn't have a choice in suppliers. As with other large industrial buyers of natural gas in Europe, it was locked into long-term supply contracts; in its case, with Ruhrgas AG and two other regional pipeline operators, which own most of the natural gas pipelines in Germany and are regulated by German authorities.
But in 1998, the European Union moved to deregulate Europe's natural gas market, freeing factories, utilities and other large industrial gas purchasers to forgo their traditional suppliers and look elsewhere. The directive took effect in August 2000.
So when Stadtwerke Heidelberg's latest contract expired, it went shopping for gas, one of the first German utilities to do so.
"We wanted to show that it's possible to get gas from another supplier," said Peter Erb, the utility's manager of energy trading. "All the big players in the German market were saying it's not possible." As for his traditional suppliers, Mr. Erb said, "They were very angry."
In the end, Stadtwerke Heidelberg succeeded in finding an alternative supplier, but the utility's troubles in the open market show just how difficult the process can be.
The utility and its new supplier, Enron Corp. of the U.S., had to negotiate with Ruhrgas and the two other natural gas providers for six months before they could get access to transmission pipelines. They also had to navigate through a confusing thicket of tariffs, rules and technical requirements.
Although the EU's gas directive required pipeline owners to provide non-discriminatory access to their system, it didn't make clear how that would be done. As many would-be gas suppliers quickly learned, negotiating such access can be very tough. The rules differ in different European nations and the pipeline owners can use the confusing regulations to their advantage to frustrate competitors.
So far, there isn't "the degree of competition that the industrial gas users expect from a liberalized market," said Francesco Balocco, energy issues manager at the European operations of Dow Chemical Co.
Energy consulting firm Dri-Wefa recently surveyed 59 large industrial gas buyers, and found that while 40% have sought new gas contracts, only 12% have switched suppliers. The survey identified 13 new entrants into the gas-supply market, including incumbent national players expanding in other EU countries and also large energy-trading firms such as Enron.
Stadtwerke Heidelberg started its effort to diversify its natural-gas purchasing in December 1999, when it had just months remaining on its 20-year contract. Mr. Erb picked up the phone and started calling potential suppliers and found the most interest at Enron's German headquarters. The Houston, Texas-based natural gas giant had grown explosively at home by competing for business against monopoly gas providers, and it was looking to do the same abroad.
It took the two companies six months to secure access to pipelines in Germany. "It's absolutely natural for a network operator that is also competing in the supply market to try to keep us off the network," said Paul Hennemeyer, Enron's director of regulatory affairs. Enron's officials ran into constant delays, were asked to supply more and more information and sometimes even had a hard time reaching the right people at the companies they were negotiating with, Mr. Hennemeyer said.
Ruhrgas says it was trying to be helpful, but argues that lengthy negotiations were inevitable because it was tackling many access issues for the first time. "We made every contribution to provide for fair and easy access network access," said a Ruhrgas spokeswoman. "In the beginning, the system needed some time to develop." Shortly after a deal was reached, the German government spelled out new rules on pipeline access, which will make future negotiations easier.
In Oct. 2000, Enron began to deliver gas to Stadtwerke Heidelberg, and to another German municipal utility, which followed a similar negotiating path. Stadtwerke Heidelberg moved cautiously; it bought 30% of its natural gas from Enron, with the remainder from its traditional suppliers. Enron and Stadtwerke Heidelberg won't discuss the details of their contract, though both say Enron offered a cheaper price than Stadtwerke Heidelberg's other suppliers.
But the German utility quickly absorbed the cost-saving lessons of a deregulated market:
Starting in October, the utility will drop Enron in favor of another company, Wingas, which has built a new pipeline to Heidelberg. The reason: a combination of a better price and the convenience of a new supply route.
"We obviously didn't break out the Champagne," Enron's Mr. Hennemeyer recalls. But he says Enron welcomes such switching of suppliers in general as a sign of the free market.

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

A Section
2 Sides Spend Millions To Generate Support

08/23/2001
The Washington Post
FINAL
A15
Copyright 2001, The Washington Post Co. All Rights Reserved

To hear executives at Enron Corp. tell it, their company has been outgunned for years by the giant utilities in the lobbying battles in Washington over electricity policy.
"We're a little guy," said Jeffrey K. Skilling, who served as chief executive of the Houston company until he quit last week. "We've been fighting a battle against some very big hitters."
From 1992 to 1999, utilities spent large sums to keep electricity deregulation at bay, helping to prevent Congress from taking any action to mandate it at the local level and engineering a House restructuring bill generally viewed as favorable to utilities. That bill died in the House Commerce Committee in 1999.
"A ferocious lobbying campaign was waged" on retail deregulation, said a former Republican aide. Southern Co., the big Atlanta-based utility holding company, made its influence felt, he added.
In 1992, Southern hired Mississippian Haley Barbour to work for it in Washington. Barbour left in 1993 to serve as chairman of the Republican National Committee, a post he held until 1997. When he left the RNC, Southern again used his services.
After the GOP took control of Congress in 1995, the company also had direct access to House Speaker Newt Gingrich (R-Ga.) and Senate Majority Leader Trent Lott (R-Miss.), who looked out for the company's utilities in their home states.
Reports filed last year with the Federal Energy Regulatory Commission provide other insights into the source of Southern's strength in the South. In 1999, its affiliates in Mississippi, Alabama, Georgia and Florida reported spending more than $20 million on various civic, political and related activities, including $250,000 for the Birmingham Early Learning Center, $323,717 for the Mississippi Power Foundation, and dozens of other gifts ranging from $5,000 to the Gulf Coast Symphony to $191,398 for community charities in north Florida.
But Enron Chairman Kenneth Lay was cultivating his own GOP connections. A longtime fundraiser and activist for former president George Bush, Lay and Enron officials had contributed more than $550,000 to his son's presidential bid by July 1999, according to the Center for Public Integrity.
Lay, according to a spokesman, has also helped raise money for House Majority Whip Tom DeLay (R-Tex.) and for his Republican Majority Issues Committee, which was set up in 1999 to support House GOP members facing close races.
Nonetheless, Southern Co. still outspent Enron on lobbying in 1999 by $4.2 million to $1.9 million, according to the Center for Responsive Politics.
"People talk about Enron being big and powerful," Skilling said. "I mean, come on . . . the utilities were powerful adversaries. We're still a little company compared to them."
-- Dan Morgan

http://www.washingtonpost.com
Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

A Section
Traders, Old Utilities Tangle Over Wires
Dan Morgan
Washington Post Staff Writer

08/23/2001
The Washington Post
FINAL
A01
Copyright 2001, The Washington Post Co. All Rights Reserved

ATLANTA -- Last of three articles
Ever since steamboat captain W.P. Lay founded Alabama Power Co. in 1906 to develop electricity along the Coosa River, utility companies have been stringing wires throughout the South for one purpose: so southerners could have power and light.
Now a bunch of outsiders, who buy and sell electricity but don't have a single retail customer below the Mason-Dixon line, have their sights set on those wires, and they are getting a helping hand from some powerful allies in Congress and the Bush administration.
Aided by supercomputers, and operating out of trading rooms as big as hockey rinks, the new breed of traders buy blocks of electricity anywhere along the nation's power grid, then borrow transmission lines to ship it to the highest bidder. But to more effectively move power from where it is cheap to where it is in strong demand, they want to remove what they contend is a "wire curtain" around the South. That means forcing the southeastern utilities to relinquish control of the wires to a new, federally supervised regional authority.
"The monopoly is the wires, and that's where the battles occur," said Jeffrey K. Skilling, who was chief executive of Houston's Enron Corp., the largest of the power merchants, until he resigned last week.
The clash grows out of a huge federal gamble on electricity deregulation.
In 1992, with many utility behemoths staggering under debt from cost overruns on nuclear plants and the rapid spread of computer technology putting new demands on the grid, Congress opted for a competitive market. The plan was to dismantle long-standing utility monopolies and replace them with innovative electricity companies responsive to the laws of supply and demand.
Now these new merchants of power, along with restructured utilities that have shed their old ways and embraced the new competitive world, have become strong advocates for a free-flowing, national electricity market. But in a classic Washington lobbying confrontation, they are running into resistance from traditional utilities, exemplified by Atlanta's Southern Co., now the parent of Alabama Power and other southern utilities.
At issue is how fast the federal government, in the wake of the California electricity crisis, should push for yet more changes.
Last month, the Federal Energy Regulatory Commission (FERC), recently stocked with President Bush's pro-market appointees, ordered most utilities to negotiate with federal mediators on procedures for handing over control of their wires to a few big regional authorities. Those authorities, in turn, will build new transmission lines, do away with bottlenecks, set uniform rates and ensure equal access to all. Next month, the Senate will take up proposals to give FERC even more authority to restructure the electricity industry.
But what is good for Enron may not necessarily be good for utility customers in the South, according to executives at Southern Co., whose affiliates dominate power sales in Georgia, Alabama, Mississippi and north Florida. Southern Co., Chairman H. Allen Franklin said in a recent interview, "will not go blindly" into the system proposed by FERC.
Although unfettered access to Southern's 26,650 miles of lines might help long-distance sellers of wholesale power such as Enron, company officials say it could mean congestion, power outages and higher prices for their 3.9 million retail customers.
"When California was restructured, it was thought there would be massive savings," Franklin said. "Well, there haven't been."
Building the Power Trade
If the California energy crisis left doubts about the future of a competitive market in electricity, a visit to Houston dispels them.
In the city's energy alley, Enron Corp. -- with annual sales of more than $100 billion last year, double those of Texaco -- is finishing a new 40-floor office building adjacent to its 50-story tower. Enron's competitors, Dynegy Inc., Reliant Energy and El Paso Energy, are a few blocks away. Duke Energy North American, merchant arm of Charlotte-based Duke Power, has settled in as well. And Calpine Corp. plans to take over 12 floors of a new 32-story building near Enron.
These power merchants are at the center of a burgeoning unregulated wholesale market, which now handles about a quarter of U.S. electricity output. But it is still a work in progress, fluid and accommodating in the Northeast and parts of the Midwest but much less open in the South.
In exchange for utilities opening up their transmission lines to the new wholesale market, the 1992 Energy Policy Act law allowed them to buy or build unregulated power plants outside their service areas. Many did. Quickest to embrace competition were California and the Northeast, which had long endured high power costs. To spur competition, California and some northeastern states went further, requiring utilities to sell off their regulated plants and begin buying bulk power from wholesalers.
Many states went further still, ending their utilities' long monopoly over retail sales and allowing customers to pick their own electricity provider.
The Northeast already was something of a mecca for power traders because of its experiments with power pooling, in which groups of utilities merge their separate transmission systems and use a central manager to market and distribute their electricity.
Enron, formed in 1985 by the merger of two big gas-pipeline companies, was quick to seize the opportunities. Its chairman, Kenneth Lay, a former official at the Federal Power Commission, FERC's precursor, during the Nixon administration, had pioneered natural gas trading during the volatile period of pipeline deregulation in the 1980s.
As the electricity market began to develop in the early 1990s, Lay and Skilling, a weekend dirt biker with a degree from Harvard Business School, began applying some of the lessons learned in the natural gas markets.
Enron signed its first long-term power contract in 1989, Skilling recalls. Independent companies that wanted to install gas-fired generators and sell the power on the grid could buy the gas from Enron under long-term contract -- then sell the electricity back to Enron.
"We started creating forward and futures markets" using "a lot more financial engineering" than was required in other commodity businesses, Skilling said. By the late 1990s, Enron was buying the output of generating plants days, weeks, months and even years before it was produced, using sophisticated weather and economic data to predict a price at which it could be profitably sold.
During the past five years, Enron has been one of the nation's fastest-growing companies. Its net income rose 40 percent in the second quarter of this year, although the price of a share has sunk to less than half of its 2000 high of $90, mainly because of setbacks in businesses unrelated to electricity. Investors pushed the price still lower after Skilling's departure last week.
Southern Inhospitality
Like other merchants, Enron plunged into California after the legislature opened up that giant state to electricity competition. But the Southeast remained less-friendly territory.
Texas is the only southern state to adopt retail deregulation. Florida goes so far as to ban out-of-state companies from building almost any plant for the wholesale market.
The region is the domain of huge traditional utilities that control the wires from Louisiana to Florida and up into Appalachia and the Carolinas. The web of power lines, tied to the utilities' coal-, nuclear- and gas-fired generating plants, reaches across states via 500-kilovolt workhorses and down into neighborhoods served via single wires strung on wooden poles.
For Southern Co., its reputation as a traditional utility heavy is a badge of pride. In 1997, it displayed a picture of a gorilla on its annual report.
Clustered around its borders are Entergy, another huge holding company that serves Louisiana, Arkansas, and parts of Mississippi and Texas; Florida Power & Light; Carolina Power & Light; Duke Power; and the federal government's centralized power giant, the Tennessee Valley Authority.
Those utilities have been under little pressure from customers to share the lines with wholesale competitors in the interest of lower prices. Prices run 15 percent or more below the national average, thanks to a rich lode of coal and natural gas and general public acceptance of the high-tension lines that carry the power generated by those fuels.
FERC, in a series of orders from 1996 to 2000, required utilities to open their wires for power shipments by independent merchants and to post how much transmission capacity they have available at any given time. The message, a former official said, was "they couldn't use the wires to preclude others from getting their juice to market."
But merchants say it is difficult to ascertain the accuracy of the postings made by the southeastern utilities because they operate the transmission lines as part of their closed, plant-to-customer systems.
A November 2000 FERC staff investigation of bulk power markets in the Southeast concluded that the transmission monopoly enjoyed by the region's utilities has discouraged independent power producers from siting new plants in the region.
FERC investigators cited Southern Co.'s refusal to let SkyGen Energy Inc. connect to its transmission lines in Alabama. Southern said the added load "would cause an area-wide stability problem for electric supply."
In that case, FERC denied SkyGen's request for relief.
Enron Vice President Kevin Presto said that day-ahead sales to customers such as municipal utilities in Southern's territory have become possible. But he said Enron has trouble getting long-term transmission commitments from Southern that would enable it to sell such power regularly. Also, he said, Enron cannot easily move power long distances through Southern's grid. "If I tried to buy transmission across Southern Co. to Jacksonville Electric, there'd be zero available," Presto said.
Of the overall situation in the Southeast, he said that the utilities "give you 0 to 5 percent of their transmission capability because they preserve the rest of it for native load [retail customers]. So you have a huge highway that's supposed to promote the free sale of electrons that isn't available to the wholesalers."
Southern Co. Chairman Franklin dismissed as "unfounded" the complaints of the merchants, and officials representing Alabama and Georgia municipal utilities tied to Southern Co.'s lines say they generally have been treated well.
Robert Johnston, president of the Municipal Electric Authority of Georgia (MEAG), which supplies power to 48 towns, took issue with the notion of a wire curtain.
"The market is growing in Georgia," he said. MEAG has its own trading room and has done business with a hundred or so traders or independent power producers. It also has its own generators producing power at four sites, though Southern Co. has an interest in all of them.
"There's not a grass-roots interest" driving the reforms, Franklin said. "It's the wholesale players."
While it squares off against the newcomers in the Southeast, though, Southern itself has aggressively exploited the growing wholesale market. Until it was spun off as a separate company earlier this year, Mirant Corp., Southern Co.'s marketing subsidiary, competed in California, the Midwest and the North, supplementing leaner profits from Southern Co.'s regulated units.
"Southern's strategy has been clear: Compete elsewhere and run a monopoly at home," said Allen Mosher, director of policy analysis at the American Public Power Association.
Well Connected for Battle
The next move is up to the federal government.
Next month, Sen. Jeff Bingaman (D-N.M.), chairman of the Energy and Natural Resources Committee, plans to propose legislation giving FERC expanded powers over wholesale transactions and transmission, so that "vested interests" will not be able to "manipulate the use of the transmission system" to benefit their own plants, Bingaman's office said.
In the House, key players will be Commerce Committee Chairman W.J. "Billy" Tauzin (R-La.), whose state is home to Southern Co.'s western neighbor, Entergy, and Rep. Joe Barton (R-Tex.), chairman of the energy and environment subcommittee, who has had close ties to the huge coal-dependent Texas utility TXU.
Last week, Entergy hired former FERC chairman Curt L. Hebert Jr., a Mississippi prote{acute}ge{acute} of Senate Minority Leader Trent Lott (R-Miss.), to handle regulatory and government affairs.
Enron recently hired a former aide to House Majority Leader Richard K. Armey (R-Tex.), as well as a former senior spokesman in the Bush campaign, Edward Gillespie of Quinn Gillespie & Associates.
Enron officials are counting on support from House Majority Whip Tom DeLay (R-Tex.), the hometown Houston congressman, though it is uncertain how much influence DeLay, an enthusiast for electricity deregulation, can bring to bear.
Industry lobbyists who gathered on Capitol Hill in July for closed-door meetings that DeLay sponsored, but did not attend, could not reach consensus on electricity. As a result, the energy bill passed by the House on Aug. 2 skirted key issues involving greater accessibility to the grid and electricity reliability.
Bush's election, and the fact that many utilities have plunged enthusiastically into the competitive market, clearly has created a more favorable political climate for the power merchants. Bush's first two appointees to FERC, Pat Wood III and Nora Mead Brownell, moved quickly to fix what they viewed as the Washington electricity bottleneck.
Wood had worked with Enron during a six-year effort to create a more competitive energy market in Texas, where Wood headed the state's public utility commission. Brownell, a former Pennsylvania utility regulator, won praise from Enron in 1997 when she helped block a restructuring plan that Enron contended would keep it out of the Philadelphia market.
On July 11, with a majority in tow, Wood, Brownell and William L. Massey, a Clinton appointee who is an ardent supporter of competition, tossed out proposals by Southern Co. and other utilities and directed utilities throughout the country to commence negotiations with federal mediators on handing over control of their lines to four independent regional transmission organizations, or RTOs.
"It was about time [a bomb] was dropped," Wood said.
But FERC's action may only have been what power association's Mosher calls the "beginning of a long movie."
Among those opposing expanded FERC authority are environmentalists who are fearful that new federal powers could lead to an expansion of high-voltage power lines; western property-rights advocates; and state utility regulators. Politically well-connected groups not now regulated by FERC -- including the TVA, rural electric co-ops and municipal power systems -- are also wary of new federal powers.
"There are big questions about FERC's role, who will determine transmission-line charges, should there be federal [authority] to site power lines, should there be FERC jurisdiction over power generation and reliability," said Rep. Richard Burr (R-N.C.), vice chairman of the House Energy and Commerce Committee.
Idaho utility regulator Marsha Smith, who heads the electricity committee for the National Association of Regulatory Utility Commissioners, noted that her state's three investor-owned utilities cannot transfer ownership or control of their transmission lines "without our approval."
Such approval does not seem likely anytime soon. Smith noted that 60 percent of the state's power comes from hydroelectric dams. "That's public property," she said.
In Alabama, James Sullivan, a state utility regulator overseeing Southern Co.'s affiliate, said he was not happy about the way FERC was proceeding.
"I'm opposed to any [changes to] our electric system in Alabama until I know it's going to bring rates down and enhance reliability for us," he said.
In the view of Southern Co. Chairman Franklin, it is still an "open question" whether FERC has the legal authority to force utilities to surrender control of all their wires.
Nonetheless, the restructuring of the power markets may already have gone too far to "put the genie back in the bottle," according to a former FERC official.
The power merchants readily concur.
"Everybody's paying too much because you've got this huge conservatism built into this bureaucratic operation of the utilities," Enron's Presto said.
Staff researcher Richard Drezen contributed to this report.

http://www.washingtonpost.com
Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

Business/Financial Desk; Section A
Relentless Search for Growth Humbles a Mutual Fund Star
By PATRICK McGEEHAN

08/23/2001
The New York Times
Page 1, Column 1
c. 2001 New York Times Company

James D. McCall was one of Wall Street's best stock pickers in the late 1990's, his hand so hot that Merrill Lynch, eager to revive sales of its mutual funds, paid a ransom to his previous employer to win his services. Starting early last year, Merrill's brokers collected more than $1.5 billion from their clients for Mr. McCall to invest.
But in a breathtaking reversal of fortune, Mr. McCall has compiled one of the worst investment records of the new century with that money. All but about $650 million has been lost, leaving shares that cost many Merrill customers more than $10 each worth slightly more than $2.
As of Tuesday, Mr. McCall's main fund, Merrill Lynch Focus Twenty, held the rare distinction of ranking in the bottom 1 percent among funds of its kind for the previous day, week, month, quarter and year, according to Morningstar Inc., a company that analyzes mutual funds.
Though Mr. McCall is free to invest anywhere in the stock market, he has stuck to a growth-seeking strategy that kept the fund invested primarily in technology stocks throughout that sector's long, steep decline. Down almost 80 percent in the last year, the fund's performance has been significantly worse than that of the average technology fund, let alone its peer group of more diversified funds. It did, however, register aggressive gains in two market rallies.
Lately, the Focus Twenty fund seemingly went from bad to cursed as some of Mr. McCall's favorite stocks were laid even lower by a series of unfortunate surprises. His bigger holdings include Enron, whose shares fell 8 percent after its chief executive suddenly resigned, and Ciena, which dropped 30 percent in a day on disappointing earnings.
''It has been a miserable week,'' Mr. McCall allowed in an interview on Tuesday. ''It's not easy managing a portfolio like this in this type of an environment.''
Mr. McCall's rapid rise and fall demonstrates how fleeting stock-picking stardom can be, said John C. Bogle, founder of the Vanguard Group mutual fund company. Too often, Mr. Bogle said, investors chase after the past returns of the fund manager of the moment, only to find out they were pursuing a ''comet.'' (Investors in Vanguard's own aggressive growth fund, Vanguard Growth Equity, have had their shares drop 53 percent in value from their peak 17 months ago.)
Still, Vanguard is known for its index funds -- the antithesis of Mr. McCall's stock-picking discipline -- and Mr. Bogle is indexing's most outspoken champion. In speeches around the country, he has repeatedly and coyly -- avoiding any mention of Merrill's name -- cited the giant brokerage firm's creation of Focus Twenty and another fund in March 2000 as an example of racing to cash in on the latest market fad.
In roughly five weeks, Merrill's brokers gathered a total of more than $2 billion for Focus Twenty and the Internet Strategies fund. Almost immediately, those funds collapsed along with the Internet and technology stocks they owned. Internet Strategies, which Mr. McCall does not manage, never recovered and has now lost more than 80 percent of its value; Merrill plans to merge it with another of its stock funds.
But Mr. McCall, 47, said his fund did not face a similar fate. Indeed, he said, Robert Doll, the chief investment officer for Merrill's funds, recently told the firm's brokers that Merrill was committed to Focus Twenty and its aggressive, concentrated style.
Mr. Doll was not available for comment, but Merrill confirmed Mr. McCall's account. ''We are committed to having a full range of investment styles, aggressive growth being one of them,'' said a spokesman, Erik Hendrickson.
Funds seeking to rack up market-beating returns by making big bets on as few as 20 stocks proliferated in the late 1990's, in part because of Mr. McCall's success managing the PBHG Large Cap 20 fund for Pilgrim Baxter, a fund company in Wayne, Pa. In the two and a half years Mr. McCall ran it, the PBHG fund ranked first among its peer group -- funds that buy stocks of large companies whose earnings are expected to grow quickly -- with average annual returns of more than 50 percent.
It was those knockout numbers that brought Merrill calling in its search for proven growth-fund managers to broaden the firm's value-oriented lineup of funds. After Mr. McCall accepted Merrill's job offer, Pilgrim Baxter sued to stop him from breaking his employment contract. Mr. McCall countersued, and Merrill later agreed to pay an undisclosed sum to settle the litigation.
In court papers, Pilgrim Baxter disclosed that Mr. McCall had earned as much as $1.5 million annually there. Mr. McCall and Merrill officials have repeatedly declined to reveal how much the firm paid Pilgrim Baxter or any details of Mr. McCall's compensation at Merrill. Often, however, investment returns affect the pay of fund managers.
Like Focus Twenty, most of the concentrated funds sank last year with the collapse of technology stocks. The managers of some of those funds, including Marsico Focus, have shifted money out of volatile technology and telecommunications stocks and into more mature companies, like Citigroup and Omnicom, which owns ad agencies.
Mr. McCall sniffed at some of those choices, saying that the fund managers were not staying true to their mission of aggressive growth investing.
''I'm not going to own an Omnicom,'' he said, ''or a Sony or a Viacom or General Dynamics, because they're growing in the single digits.'' Thomas Marsico, the manager of Marsico Focus and one of the original concentrated-fund managers, did not return a call seeking comment.
Mr. McCall said he would continue to try to identify the companies that have the best chance of increasing their profits at extraordinary rates, regardless of what value other investors are assigning to those prospects at any given time.
''Valuation is not one of the factors that enters into our methodology,'' Mr. McCall said.
About 70 percent of Focus Twenty's assets are in technology stocks, according to Morningstar. But the fund's biggest holding now is Idec Pharmaceuticals, a drug maker.
Kunal Kapoor, a Morningstar analyst who tracks Merrill's funds, calls Mr. McCall a momentum investor who seeks ''growth at any price.'' Mr. McCall may be the best investor of that stripe, Mr. Kapoor said, but the strategy is so risky that he questions whether it was ever appropriate for so many of Merrill customers.
''I was really surprised by the amount of funds they were able to raise for a fund like that in such a short time,'' Mr. Kapoor said. ''The question is: Do you really need a fund like this?''
Reading a prepared statement, Mr. Hendrickson said Merrill Lynch considered concentrated funds to be ''an appropriate option'' for some investors, because they ''maximize the impact of professional stock-picking over the long term and additionally may serve as an alternative to individual stock holdings.''
He pointed out that Merrill managed another concentrated fund, Merrill Lynch Focus Value, that had performed well this year, gaining more than 3 percent.
As for Mr. McCall's returns, Mr. Kapoor said he could not fault Focus Twenty because it had performed as would be expected for a fund of its composition. It rang up some of the biggest gains of any fund in two brief periods when the market picked up -- the third quarter of 2000 and April of this year -- and some of the biggest losses when the market was down.
Rather, he said he was more disappointed with the other fund Mr. McCall manages, the Merrill Lynch Premier Growth fund, which is supposed to be less volatile because it holds about 50 stocks. That fund is down more than 50 percent this year and has shrunk to less than $100 million in assets.
Mr. McCall said that he had warned Merrill's brokers all along just how volatile his returns could be and that Focus Twenty was no place for investors to put money they might need any time soon.
But, he said, he thinks that now, more than ever, is the time to take a chance on the fund, with its shares selling for about $2.20.
''I don't think $2 a share is a lot to risk,'' the indomitable fund manager said. ''We could go down from here certainly, but over the long term, there is more potential on the upside than on the downside.''

Photo: Before James D. McCall came to Merrill Lynch, he was at Pilgrim Baxter, where he successfully managed the PBHG Large Cap 20 fund. (Ethan Hill)(pg. C2) Chart: ''Losing Big'' Since March 2000, clients of Merrill Lynch have poured more than $1 billion into the main fund managed by James D. McCall. As many fund managers pulled their money out of technology stocks, Mr. McCall stayed with the sector and compiled one of the worst investment records among fund managers the last 18 months. Chart shows Merrill Lynch Focus Twenty fund since Mar. 2000 (Source: Bloomberg Financial Markets)(pg. C2)
Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

A Section
From Maine to N.Y. Way of Atlanta; Trades Light Up States by Long Distance

08/23/2001
The Washington Post
FINAL
A15
Copyright 2001, The Washington Post Co. All Rights Reserved

If the state of New York avoids brownouts this summer, it will be due in a small way to the efforts of Andrew Gillespie, a young electricity trader who works for Mirant Corp. in an Atlanta suburb.
Mirant grew out of Atlanta-based Southern Co.'s aggressive attempt to enter the unregulated market that was developing outside its home region. Early this year, Southern spun off Mirant as a separate company that Wall Street stock traders value at about $11 billion.
Gillespie spends much of the day staring at a map of New York that glows green on his computer screen. The map displays the prices at which electricity is selling at key points on the state's power grid.
One summer day, Gillespie called a trader who buys electricity from New England's centralized power pool, which manages power sales from regional utilities such as New England Power, Boston Edison and Central Maine Power.
He agreed to buy 14 megawatts over a 16-hour period the next day and pay about $9,000. He used the phone to offer the power to the New York Independent System Operator, a nonprofit organization set up to manage the state's wholesale market and its high-voltage transmission system, for a small markup.
Then he waited to find out whether the offer was accepted. If it was, he would go online to book a transmission route. If not, he would unload the power on another trader in the over-the-counter market, made up of merchant companies such as Enron Corp., Dynegy Inc., Duke Energy North America, Reliant Energy, El Paso Merchant Group, Calpine Corp. and Entergy-Koch Power Marketing.
Traders like the Northeast because it allows one-stop shopping. "If I want to wheel power from Maine through Massachusetts to Connecticut, I pay just one transmission charge rather than having to call each utility and schedule it," said Michael Hobbs, Mirant's marketing director for the northeastern United States.
In the South, traders say, booking transmission can be a lot more complicated -- and sometimes impossible. Utilities operate their own contained systems and advise traders when and if they have "ATC," available transmission capacity.
Electricity trading is a commodity business not unlike selling wheat, platinum or hog bellies, though it is trickier than most, according to Marce Fuller, Mirant's chief executive, because electricity can't be stored.
"Information is paramount," Hobbs said, so Mirant traders keep a constant eye on weather reports and also consult the company's on-site meteorologist. To provide further assistance, a digital board that wraps around the trading room updates information ranging from the temperature and humidity in Brazos County, Tex., to the spot price of electricity at "COB," traders' slang for the California-Oregon border.
The jobs of the traders at Mirant, Enron and the other companies didn't exist a few years ago, and neither did most of the companies. Regulated utilities, co-ops and a few big government power agencies, such as the Tennessee Valley Authority, generated almost all of the power and shipped it to retail customers over their own wires.
Now roughly a quarter of the electricity produced in the United States comes from unregulated companies that sell almost exclusively to the long-distance bulk-power trade -- the wholesale market.
-- Dan Morgan

http://www.washingtonpost.com
Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

UK: Copper pushes ahead in subdued LME pre-market.

08/23/2001
Reuters English News Service
(C) Reuters Limited 2001.

LONDON, Aug 23 (Reuters) - Copper prices rebounded in London Metal Exchange (LME) pre-market trade on Thursday, having fallen through the psychological $1,500 a tonne level the previous evening, traders said.
"There was nothing on the close last night to suggest anything happening, and there was no interest overnight, but this morning we've seen a number of the electronic screens - particularly Enron - being marked higher," said one senior trader.
Three months copper was indicated at $1,513/1,515 at 0850 GMT, up $11 from Wednesday's evening kerb close.
"The market hasn't given up the ghost yet. There's still some room to push higher, with minor technical resistance around $1,525," the trader said.
With consumer buying still largely absent, trading conditions remained subdued, however.
"The appeal of the markets is limited at the moment. Too many fingers have been burned - you can still see a lot of the specs sidelining themselves," the trader said.
"We've suffered consumer destocking in the first and second quarters. There's a bit of weakness in the U.S. dollar, which is helpful, but business confidence isn't great."
Despite periodic short-covering rallies, the overall downtrend remains in place pending concrete evidence of an upturn in the economic situation, analysts said.
"The short-term moving averages may be a bit more constructive after last week's rally, but the trend is still down. I remain sceptical for the time being," the trader said.
Aluminium also pushed higher in early trade, indicated up $5 at $1,428/1,430.
Initial resistance is evident at $1,430 with a stiffer upside barrier at $1,440, analysts said.
Nickel edged up $20 to $5,720/5,750, shrugging off news that Russia's Norilsk Nickel had restarted work at its key nickel plant, which was halted after an accident on Sunday.
"The third smelting furnace started working at 0400 local time (2000 GMT) on August 23," spokesman Yevgeny Yerokhin told Reuters. "By this time another two furnaces had already started working."
"The plant will fully restore its production volumes by the end of the day on August 24," he added.
The smelting division of the nickel plant, in the Norilsk region on the northern Siberian Taimyr peninsula, was halted on Sunday after a leak of melted metal damaged water cooling systems and electricity supply lines.
The plant's management has promised to catch up with the output arrears stemming from the accident within a month.
The rest of the complex was little moved in early trade.
Zinc was indicated unchanged at $849/852, showing little response to overnight news thatthe U.S. Defense National Stockpile Center (DNSC) had cancelled its remaining long-term zinc sales in fiscal year 2001 after it failed to make any zinc award in its latest bid invitation.
"DNSC anticipates resuming sales in the first quarter of fiscal year 2002 depending on market conditions," it said in a statement. The DNSC had been offering prime western zinc for sale by sealed bid on a monthly basis.
Lead was also unchanged at $480/483, with tin up $10 at $3,870/3,900 and alloy down $5 at $1,180/1,190 after a hefty 1,580-tonne increase in LME stocks.

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

Papers on Dabhol project not received

08/23/2001
The Times of India
Copyright (C) 2001 The Times of India; Source: World Reporter (TM)

MUMBAI: The consumers' representative for the Maharashtra Electricity regulatory Commission (MERC), ``Prayas,'' has not yet received the sheaf of documents from the Maharashtra State Electricity Board (MSEB) concerning the Dabhol power project (DPC) which it had asked for.
The MERC had passed an order on July 31 asking the MSEB to furnish the financial documents relating to some contracts signed by Enron for the project. The MSEB is learnt to be now examining the legality of making these documents public after a stern letter from the Dabhol Power Company, pointing out that the board might be liable for ``damages and legal action'' if the contractors take offence to making the documents public.
Enron wrote to the MSEB a few days after the order, contending that most of these documents had confidentiality clauses which would make it actionable. Asked about this, sources at DPC said that suppliers would be upset if their terms and conditions were made public since Enron's is only one of the plants sourcing business from them. For instance, Enron's LNG fuel supply contract with an Oman company has a confidentiality clause and would fear exposing its contract terms to the public in view of the fact that over 80 per cent of its supply is concentrated in Japan, Taiwan and Korea. ``It would be damaging for its business if our deal, which is less than 18 per cent of its business, ends up influencing its other deals,'' the source said.

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

INDIA: ANALYSIS-Poor governance hobbles India's reform drive...

08/23/2001
Reuters English News Service
(C) Reuters Limited 2001.

ANALYSIS-Poor governance hobbles India's reform drive
By Alan Wheatley, Asian Economics Correspondent
NEW DELHI, Aug 22 (Reuters) - After six months of political stalemate, the rave reviews for Finance Minister Yashwant Sinha's reforming budget have given way to the despairing conclusion that perhaps India embraces change only in a crisis.
In which case, a new wave of reforms might not be far away.
For unless growth picks up substantially from last year's 5.2 percent pace, policy experts said India would face a further deterioration in its public finances and rising unemployment that could put the world's largest democracy under serious strain.
"We can't go on without further reforms for very long because we won't be able to grow even by five percent," said Shashanka Bhide, chief economist of the National Council of Applied Economic Research.
"So the crisis is already there. If we're not going to get six percent-plus growth rates, then it's a political problem."
There is a broad consensus - on paper - on the need for a second wave of reforms to build on ground-breaking liberalisation measures rushed in after a balance-of-payments crisis in 1991.
Because its economy is fairly closed, India has weathered the current global downturn much better than most of its Asian neighbours, who would be delighted with five percent growth.
Still, output has slowed for two years in a row as post-reform momentum has petered out. And crucially, five percent growth falls far short of the 8.7 percent average needed over the next decade to achieve Prime Minister Atal Behari Vajpayee's goal of doubling per capita income, currently around $460 a year.
"Eight million people come into the workforce every year and a five percent growth rate would leave large numbers of people unemployed, which means there will be greater social unrest," said P Chidambaram, a former finance minister.
"A five percent growth rate, while statistically acceptable, is simply politically unacceptable and socially unacceptable."
COMPETITIVE POLITICS
It was to raise the economy's speed limit that Sinha unveiled in his February budget a raft of far-reaching structural reforms making it easier to fire workers and rolling back the policy of reserving certain industries for small and medium-sized firms.
The reforms are high on the list of the many blueprints for change in India but they soon became mired in what the Planning Commission aptly calls the "compulsion of competitive politics".
On a charitable view, the slow progress is a reflection of the wondrous kaleidoscope that is India's multi-party democracy.
"This is not a country, this is a vast continent in search of a synthesis in the political domain, the social domain and the economic domain," said Amit Mitra, secretary general of the Federation of Indian Chambers of Commerce and Industry.
Less charitably, the legislative paralysis is due to the failure by an enfeebled Vajpayee to crack heads in his unwieldy 19-party coalition and force ministers to put the national interest before the myriad vested interests opposed to change.
Arjun Sengupta, a professor at the Centre for Policy Research, said the absence of a unified agenda meant each member of the coalition was ploughing its own furrow, resulting in policy inconsistency that was deterring badly needed investment.
"This is the main problem we have today: we do not have a coherent, unified policy framework," Sengupta said.
He said the reform task facing the government was all the more difficult because India's most populous and backward states were falling farther and farther behind the better-off ones.
"If the Centre cannot take care of the problems of disparity between the states, we are facing major problems which can become explosive," Sengupta, a former ambassador and IMF official, said.
Peering through the gloom, optimists point to the precedent of legislation passed without the pressure of a crisis in 1999 to open up India's insurance market to foreign firms.
They hope two equally controversial reform bills, to liberalise the crisis-ridden power sector and to make it easier to wind up bankrupt firms, will also eventually become law after they won cabinet approval last week, ending months of wrangling.
"Anybody who says reforms have been a failure in this country hasn't looked at figures on poverty very closely," said Planning Commission member N.K. Singh. He said the poverty rate had fallen in the past decade to 27 percent from 37 percent.
REFORM PRIORITIES
The list of reforms needed to sustain this improvement is lengthy. Because of its pivotal role in the economy, the power sector is many experts' number one priority. The well-catalogued troubles that foreign firms such as Enron Corp have encountered dealing with India's all-but-bankrupt state power boards have flashed warning signals to potential foreign investors.
Domestic investors have also been deterred because industrial users pay twice as much as they would in China for electricity.
Nevertheless, attempts at serious reform have foundered on twin political rocks: how to end overmanning at the power boards, estimated at 50-70 percent, and how to charge users, mainly farmers, market rates for stolen or heavily subsidised power.
D.K. Srivastava, a professor at the National Institute of Public Finance and Policy, said politicians might consider tough measures if they could be assured that benefits would be visible before they have to seek re-election two or three years later.
"Any government under any minister will say to you, How can I survive unless I can show my voters jobs?'," Srivastava said. "This is one of the basic constraints on power sector reform."
T.K. Bhaumik, a senior adviser at the Confederation of Indian Industry, agreed and said reformers were partly to blame for having failed to sell the case for change to India's mass poor.
"We did not articulate the economic reform process to the people," Bhaumik said. On privatisation, for instance, policy-makers did not spell out the consequences for jobs.
"I don't think we really understood the issues properly. We simply followed the Washington consensus and that didn't go down well with the people," he said.
As Divestment Minister Arun Shourie knows only too well. The privatisation programme he oversees, a litmus test of India's reform will, is stalled because of what Shourie calls "fractured" politics and "noise" generated by corporate interests.
Shourie said he could only hope that fading growth would jolt India's politicians into putting the country's interests first.
"We're on the cusp at the moment on the question of reforms and I feel the real circumstances in which India is placed will force the political class to do the right thing," he said.

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


Attached is the GE override letter to accompany the facility agreements.

I'm trying to figure out the ABB form.

Kay


Daily Agenda
Thursday, May 17, 2001

Today's events...
* 11:30 a.m., SACRAMENTO   Gov. Gray Davis holds news conference to
respond to President Bush's energy plan, Capitol, room 1190. Contact:
916-445-4571.
* 2 p.m., SACRAMENTO   Assemblyman Juan Vargas discusses legislation
that would prevent utilities from disconnecting power to many senior
citizens, Capitol, room 2188. Contact: Wendy Harmon, 916-319-2079.

In the news...
* SacBee, Hardy: UC reinstitutes affirmative action.
http://www.sacbee.com/news/news/local01_20010517.html
* SacBee, Weintraub:
http://www.sacbee.com/voices/news/voices05_20010517.html
* LA Times, Tamaki: Governor's budget may have shortfall.
http://www.latimes.com/news/state/20010517/t000041479.html
* SF Chronicle, Lucas: LAO - Budget shortfall predicted.
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2001/05/17/MN82295.DTL

In committee...
* OPEN ISSUES.  Budget Subcommittee No. 1 on Health and Human
Services.  8:00am or upon call of the Chair, room TBA.
* OPEN ISSUES.  Budget Subcommittee No. 2 on Education Finance.
8:00am or upon call of the Chair, room TBA.
* OPEN ISSUES.  Budget Subcommittee No. 3 on Resources.  8:00am or
upon call of the Chair, room TBA.
* OPEN ISSUES.  Budget Subcommittee No. 4 on State Administration.
8:00am or upon call of the Chair, room TBA.
* OPEN ISSUES.  Budget Subcommittee No. 5 on Information Technology
and Transportation.  8:00am or upon call of the Chair, room TBA.

Today on the floor...
* Assembly session at 8:30am.  (Squawk Box 89.7, Assembly TV, CH. 7)
* Senate session at 8:30am.  (Squawk Box 99.1, Senate TV, CH. 5)

Richard Costigan, III
Chief of Staff
Office of the Assembly Republican Leader
California State Assembly
Phone:(916) 319-2005


Lynn, do you have any more of these pens.  If so, could you send me 7 or 8.  If not I'll just order them.

TK

-----Original Message-----
From: Walker, Scott [mailto:swalker@sidrichgas.com]
Sent: Tuesday, November 20, 2001 4:31 PM
To: T. K. Lohman (E-mail)
Subject: Pens

I received a pen at your meeting in Houston a couple of weeks ago and had
received a pen that lights up.  The guys over here have been bugging me to
find out if you have anymore available.  If not do not worry about it.

Thanks
Scott

P.S. When does Lorraine return to work