I agree with Mark's points.  While we have advocated our merger with PGE
(which did not concentrate market power) we have intervened in opposition to
most others.  Moreover, there is some hope that the German government will
take the opportunity to use the proposed utility merger to force greater open
access.   We will likely encourage that action and may oppose the merger
otherwise.   Most mergers in this industry are defensive, not procompetitive,
and, in my view, deserve no credit for convergence, innovation, or
liberlization.
---------------------- Forwarded by Steven J Kean/HOU/EES on 09/10/99 01:17
PM ---------------------------

Mark Schroeder@ECT
09/10/99 05:26 AM
To: Margaret Carson/Corp/Enron@Enron
cc: Joan Wasylik/LON/ECT@ECT, Danny McCarty/LON/ECT@ECT, Steven J
Kean/HOU/EES@EES
Subject: Speech to the British Institute of Energy Economists

Margaret - apologies for the delay in getting comments to you on your
speech.  Due to press of other matters I will be brief.

First, your speech caption, refernecing "mergers" is somewhat different than
the topic shown in the agenda, i.e., "Industry Structure and Competitive
Behaviour", but I trust you are wroking that out with the BIEE.

Second, in your first paragraph, you note that developments in the energy
sector over the last decade are due to the mergers of the last five years (a
point I will retrun to later), but in any event, not entirely consistent in
terms of timeframes.

Third, I am surprised that the Enron Corp. view is that gas and electricity
markets grew as they did over the decade due to mergers.  In the past, things
like unbundling and non-discriminatory third-party access have featured
prominently in our advocacy.  Indeed, though it was not my role at Enron, I
would have thought that in many of the recent electricity mergers pre-dating
Order No. 888 we would have joined the chorus of voices arguing that these
mergers concentrated market power, and that such market power could only be
mitigated with the provision of non-discriminatory third-party access (an
argument we will be repeating in, e.g., Germany, as noted below).  Finally, I
would note that in the past, I thought we had questioned the value of mergers
as an impediment to competitive markets, as I recall Ken Rice gave an
infamous address/speech, in which he described "good" mergers and "bad"
mergers, i.e., defensive mergers like Houston Industries and NorAm.  I
actually borrowed heavily from that speech two years ago, in paris, but if we
have changed our tune, that is good to know.  Even the "good" mergers
identified in his/my speech, e.g., Enron/Portland, have had the "goods"
thwarted, in part, by regulators, who would not let us do all we wanted to do
that was pro-competitive.  Also, in the past, we have used as a good example
of "convergence" the arbitrage we have done at Sithe's facility in NY,
pointing out that we are in an "energy" or "BTU"market, not gas alone, or
electricity alone.  Not clear to me that mergers in the US demonstrate this.

Fourth, accepting that it is the Enron Corp. view that mergers are symbolic
of the convergence of gas and electricity, and are what yield the many
beneifts of competition that you dsicuss elsewhere in your speech (I do, of
course, agree with all the platitueds that competition yilds more service
offerings, innovation, etc.), you should be aware, coming over to this
market, that a number of mergers are taking place that we have expressed
concerns about in comments to the regulators, and will do so in the future.
here are some you should be aware of:  Veical integration in the UK
electricity industry (not clear yet that this will result in better/more
service, but definitely loss of counter-parties, re-bundling of business
before retail unbundling/competition has taken hold); Exxon/Mobil
(consolidation in the upstream sector in Continental Europe, which is already
concentrated), VEBA/VIAG in Germany (probalby okay, assuming thrid-party
access is allowed/enhanced to the wires).  Just FYI, any objections we have
are usually communicated confidentially.

Fifth, if you are ging to emphasise mergers, as per your title and opening
paragraph, I question the inclusion of all the discussion on privatisation,
which is good, but does not seem to demonstrate the benefits of merger
activity, which I read is the premise of your speech, per paragraph one.  In
addition, recitation of ownership of miles of gathering lines and
transmission lines does demonstrate change in aggregate ownership, but not
clear it is all due to mergers (e.g., I thin NNG is just capital expansion),
nor does the connection get made that this has lead to innovative or enhanced
service offerings.  I do think excellent points can be made about the
deregulation/divestment of gathering, and getting it out of federal
regualtroy purview, but that is not in the speech at this point.

Sixth, you describe "network industries" well, but in the broader context of
your speech, I think your listeners will assume you are referring to the
physical network, rather than the Enron vision, which you capture accurately,
nor is it easily understood how this demonstrates or adds to your point about
convergence.

Seventh, in your table of converged companies, you could be asked about the
fact that Duke has already disposed of the pipeline assets it acquired in the
PanEnergy deal (since sold to CMS), apparently keeping only the trading
business.  Also, our pieeline assets to do not serve our cogen facilites in
NJ, so not clear to me that thisdemonstrate convergence in the East Coast.

Hope this helps.  I will be travelling today and Monday, but if you have
questions, please leave me voice mails, and I will return your calls.

P.S. at p. 7 you describe "secular" change.  I assme that this should read
"sectoral" change.

Mark


Glad you had a good time.  Next time we will have both SeaDo's working and
hopefully the lake will be a little higher.  We have your sandals.  At least
I think they are yours.  I am in Chicago right now.  We will try and get them
to you soon.  Use dgiron@enron.com for my email address.

DG

Mike Fultz <Mike.Fultz@HALLIBURTON.com> on 07/19/2000 10:48:53 AM
To: "'dgiron@enron.com'" <dgiron@enron.com>
cc:
Subject: RE: Email Address

Hey Darron,

What's going on??  Just wanted to say thanks for inviting me to go out on
the boat last weekend.  Hope I was not rude when we were leaving, but I
really started to feel like crap.  When we got back to Scott's I almost
puked a couple times and was stuck on the crapper for some time.  I ended up
not going to work on Monday and half of Tuesday because of the hebee jebees.
Anyway, if you ever need anyone to help you with the boat when you go out
(uh, yeah), give me a call and I would be glad to 'help' out.

Mike

> -----Original Message-----
> From: Darron C Giron [SMTP:Darron.C.Giron@enron.com]
> Sent: Tuesday, March 21, 2000 8:04 AM
> To: kristi.giron@cfisd.net; cgiron@mindspring.com; hollyw@email.msn.com;
> bwallace@tcast.com; mebert@tdhca.state.tx.us; mail43232@pop.net;
> scrowell@us.oracle.com; smmayers@earthlink.net; kwpope@pdq.net;
> mike.fultz@halliburton.com; dbeckman@bindview.com
> Subject: Email Address
>
>
>
> The address of dgiron@ect.enron.com is being deleted because of a company
> name
> change.  If you still use this, change it to dgiron@enron.com.  Thanks.
>
> DG
>


Please put me in line for a flu shot. I would like one as soon as they are
available.


---------------------- Forwarded by Jeff Dasovich/SFO/EES on 06/13/2000 03:49
PM ---------------------------

"Cherry, Brian - TPBKC" <BCherry@sempra.com> on 06/13/2000 02:35:23 PM
To: "'Pocta, Robert M.'" <rmp@cpuc.ca.gov>, "Cherry, Brian - TPBKC"
<BCherry@sempra.com>, "'AlexanMS@sce.com'" <AlexanMS@sce.com>,
"'paulamirault@aec.ca'" <paulamirault@aec.ca>, "'david.bayless@utility.com'"
<david.bayless@utility.com>, "'Tomb@crossborderenergy.com'"
<Tomb@crossborderenergy.com>, "'Burkee@cts.com'" <Burkee@cts.com>,
"'Craigc@calpine.com'" <Craigc@calpine.com>,
"'Rick.Counihan@greenmountain.com'" <Rick.Counihan@greenmountain.com>,
"'Jdasovic@enron.com'" <Jdasovic@enron.com>, "'Mday@gmssr.com'"
<Mday@gmssr.com>, "'bdingwall@unitedgas.com'" <bdingwall@unitedgas.com>,
"'Douglass@arterhadden.com'" <Douglass@arterhadden.com>, "'eke@aelaw.com'"
<eke@aelaw.com>, "'Jfawcet@enron.com'" <Jfawcet@enron.com>,
"'rfoss@coral-energy.com'" <rfoss@coral-energy.com>, "'Gileau, Patrick L.'"
<plg@cpuc.ca.gov>, "'johnj@bcjlaw.com'" <johnj@bcjlaw.com>,
"'Johnson_Pamela@lacoe.edu'" <Johnson_Pamela@lacoe.edu>,
"'karpjos@sf.whitecase.com'" <karpjos@sf.whitecase.com>, "'jleslie@luce.com'"
<jleslie@luce.com>, "'kmccrea@sablaw.com'" <kmccrea@sablaw.com>,
"'jmpa@dynegy.com'" <jmpa@dynegy.com>, "'porterdk@sce.com'"
<porterdk@sce.com>, "'RochmanM@cubjpa.org'" <RochmanM@cubjpa.org>,
"'RochmanM@spurr.org'" <RochmanM@spurr.org>, "'susan.scott@enron.com'"
<susan.scott@enron.com>, "Betonte, Robert - TP2RSB" <RBetonte@socalgas.com>,
"Brill, Thomas R." <TBrill@sempra.com>, "Follett, B. David - TPDBF"
<DFollett@sempra.com>, "Harrigan, James P. - TP1JPH"
<JHarrigan@socalgas.com>, "Hay, James E." <JHay@sempra.com>, "Lorenz, Lad -
TPLPL" <LLorenz@socalgas.com>, "McVay, Nancy W - TPNWM"
<NMcVay@socalgas.com>, "Morrow, Rick - TP3RMM" <RMorrow@socalgas.com>,
"Purves, Ralph A." <RPurves@SDGE.com>, "Sakarias, Wayne P."
<WSakarias@SDGE.com>, "Schavrien, Lee" <LSchavrien@sempra.com>, "Sullivan,
Glen J." <GSullivan@sempra.com>, "Surak, Thomas M. - TP1TMS"
<TSurak@socalgas.com>, "Teeter, James S." <JTeeter@SDGE.com>, "Van Lierop,
Jan - TP2JXV" <tp2jxv@socalgas.com>, "Watson, Steven - TP2SAW"
<SWatson@socalgas.com>, "Wright, Gillian - TP1GXW" <GWright@sempra.com>,
"Barker, David - TPDTB" <DBarker@socalgas.com>, "'How-Downing, Lindsey'"
<lindseyhowdowning@dwt.com>, "'Jun, Christine'" <chj@aelaw.com>, "'Gileau,
Patrick L.'" <plg@cpuc.ca.gov>, "'Khoury, Dexter'" <bsl@cpuc.ca.gov>,
"'ack@aelaw.com'" <ack@aelaw.com>, "Nelson, Eric B. - TPEBN"
<ENelson@socalgas.com>, "Suwara, J.- TPJUS" <JSuwara@sempra.com>, "Wright,
Gillian - TP1GXW" <GWright@sempra.com>, "Reed, William" <WReed@sempra.com>,
"'Pedersen, Norman'" <napedersen@jonesday.com>, "'Paul, Joe'"
<jmpa@dynegy.com>, "'Hawiger, Marcel'" <marcel@turn.org>, "'Fawcett, Jeff'"
<jfawcet@enron.com>, "'O'Neill, Ed'" <ewo@jmbm.com>, "'Power, Pat'"
<pjpowerlaw@aol.com>, "'Ramirez, Jaime'" <jaime.ramirez@swgas.com>, "'Black,
Larry'" <larry.black@swgas.com>, "Fair, Pam" <PFair@SDGE.com>, "'Hall, Rich'"
<rch8@PGE.com>, "'Eisenman, Eric'" <EXE3@PGE.com>, "'Stoner, Ron'"
<rrs5@PGE.com>, "'McConn, Kathy'" <mcconnk@epenergy.com>
cc:
Subject: FW: Late Exhibit Draft

Attached for your review and comment is a draft table identifying incoming
interstate capacity at receipt points on SoCalGas' system and a system map
identifying those locations, per the request of ALJ Biren.? We have confirmed
wherever possible the incoming receipt point capacities with the pipelines
and also tried to fairly characterize the take-away capacities and deliveries
from those receipt points.? Please forward your comments to me as soon as
possible so that we can coordinate the filing of the draft exhibit to the
service list by July 16.

? <<exhibitpipecap.xls>>  <<SoCalGas.doc>>

 - exhibitpipecap.xls
 - SoCalGas.doc


I'm hearing rumblings about the need to perform various preliminary tasks
(survey work, etc.).  I've given the admonition to avoid incurring hard costs
until the financing/accounting treatment has come together.  That lead to the
question of what is a hard cost.  I know construction/equipment obligations
are problems, studies generally ok.  This leads me to the conclusion that a
geotechnical survey would be ok.  Am I safe here?

Thanks,

Kay


OR
Well, which one is it?  You want to share some information with the rest of
Enron, but you don't know whether it belongs in the ThinkBank or in eMeet.
Here is a handy quiz to help you make the decision.  Answers appear just
below the quiz.
What kind of information do you want to share?
A.  A well-developed idea or suggestion for something that will affect
Enron's bottom line, either through revenue or savings.
B.  A question or a statement that you want someone else at Enron to answer
or discuss.
C.  None of the above.
D.  Both A and B.
If you chose "A," deposit an idea in the ThinkBank's Idea Vault.  If you
chose "B," eMeet is the place for you.  If you chose "C" or "D," send an
e-mail to ethink@enron.com and let us know what you're trying to share.
We'll help you find the right place for it in eThink.

Wednesday, Mar. 29 at 10 a.m. Houston time, join Mark Koenig, executive vice
president of Enron Investor Relations.  Mark will answer questions about the
role of Investor Relations and also provide a stock update.  Remember, if you
can't make the live event, pre-submit your questions now on the eSpeak site.
Mark will be able to address them during his eSpeak, and you can see his
answers in the transcript after the event.

ethink.enron.com


Thank you, Michael!  I'm forwarding your answer to Vince Kaminski, and thank
you for reading!

Sam Smith
5-8322

	Enron Energy Services

	From:  Michael Kim @ EES                           08/28/2000 02:50 PM

To: william.smith@enron.com
cc:

Subject: Probability Question from Vince's Article

Answer is 0.2344

It's been awhile since I studied probability.  I think this is a conditional
probability problem.

Thank you.

Mike Kim


What volumes do we have for Power Gas Marketing and for the sale to Clinton?
AND what has Clinton agreed to pay us?  What is the deal number for the sale
to Clinton?

---------------------- Forwarded by Chris Germany/HOU/ECT on 10/31/2000 07:31
AM ---------------------------

Gloria G Barkowsky
10/30/2000 04:53 PM
To: Chris Germany/HOU/ECT@ECT, Wade R Price/HOU/ECT@ECT, Donnie
Myers/NA/Enron@ENRON
cc:
Subject: Re: CNG/Peoples Natural Gas

1)  Volumes for Phillips for 08/00 have been changed to 7765 dth from 7542 mcf
   2)  Volumes for Phillips for 09/00 have been changed to 11796 dth from
11452 mfc

These changes were given to me by Donnie Myers.   Thanks, Gloria

Gloria G Barkowsky
09/29/2000 09:22 AM
To: Chris Germany/HOU/ECT@ECT
cc: Wade R Price/HOU/ECT@ECT, Donnie Myers/NA/Enron@ENRON
Subject: Re: CNG/Peoples Natural Gas

Do we know yet how we are going to handle this problem??

Chris Germany
09/21/2000 03:32 PM
To: Gloria G Barkowsky/HOU/ECT@ECT, Wade R Price/HOU/ECT@ECT, Donnie
Myers/NA/Enron@ENRON
cc: Mary Theresa Franklin/HOU/ECT@ECT
Subject: Re: CNG/Peoples Natural Gas

Wade, for July and August, give me the actual volumes and price for Phillips
and Power Gas Marketing behind Peoples.  AND are these volumes MCF's or
MMBTU's?  AND do we back out any gathering charges on this gas?

Gloria G Barkowsky
09/21/2000 02:30 PM
To: Chris Germany/HOU/ECT@ECT
cc: Wade R Price/HOU/ECT@ECT, Donnie Myers/NA/Enron@ENRON
Subject: CNG/Peoples Natural Gas

Chris - this buy/sell deal with Phillips (seller) and Clinton (buyer) is
causing some
problems for these guys in settlements.  Wade is paying by mcf's, so when I
change
the volumes for Phillips, it of course effects Donnie's volumes for Clinton.
Should this
not be done as a buy/sell, or what should we do about this?  I will be out of
the office
tomorrow, but back on Monday.  Donnie is needing an answer on this soon.  So
far,
it looks like 07/00 and 08/00.  Thanks, Gloria


Carol St. Clair
EB 3892
713-853-3989 (Phone)
713-646-3393 (Fax)
----- Forwarded by Carol St Clair/HOU/ECT on 05/31/2000 01:39 PM -----

	"PAUL BRUCE WRIGHT" <PWRIGHT@LLGM.COM>
	05/31/2000 01:25 PM

		 To: <Carol.St.Clair@enron.com>
		 cc:
		 Subject: Re: Update on Insurance/Derivative Transaction

I would expect that I (I use Bruce), Scot, John McGreevy and Sam Behrens
would likely be involved.  Sam is an energy lawyer familiar with nuclear
facilities and would be helpful with background issues.

>>> <Carol.St.Clair@enron.com> 05/31/00 01:03PM >>>

Paul:
Did you mean to refer to dates in June?  Alos, could you let me know which
persons or persons will be handling the areas that we need covered as so
far I am only aware of you and Scott and i wasn't sure if others would be
involved.  Thanks.
Carol

                    "PAUL BRUCE
                    WRIGHT"              To:     <Carol.St.Clair@enron.com>
                    <PWRIGHT@LLGM        cc:
                    .COM>                Subject:     Re: Update on
Insurance/Derivative Transaction

                    05/31/2000
                    10:25 AM

I will be away from the office on business from the evening of Friday, May
12th, returning on Monday, May 22nd.  During this period, I will not have
email access for a portion of the trip and there may, therefore, be a delay
in my responding to emails sent during this period.


Sara -

Per our earlier conversation, could you please prepare a revised guaranty for
Merrill Lynch?  There are two significant changes to the guaranty currently
in place:

1)  Beneficiary of the new guaranty should be Merrill Lynch International
Bank, Ltd.   The current guaranty is to Merrill Lynch International Bank.

2)  The guaranty amount should be increased from $30 million to $150 million.

Please send revised guaranty to:

  Todd Gibson, Vice President
  Merrill Lynch & Co., Inc.
  4 World Financial Center, 16th Floor
  New York, NY 10080

Thanks for all your help and please let me know if you have any questions.

Jay


With the filing of the Hart-Scott-Rodino application last week, it looks like our updated launch timeline is as follows. Note that it is still possible that this timeline could shift:

Week of Jan 28:

We will distribute a packet to each of the Originators/Traders who have volounteered to call customers and assist in getting signed Password Applications. The packets will contain:

Key Messages
Frequently Asked Questions (FAQs)
Top Counterparty Checklist
External Customer Cover Letter
Password Application (PA)
Registration Form
Fax Cover Sheet for PA/Registration
Electronic Trading Agreement (ETA)
Internal online Marketing Contact List

Each person receiving a pack will contact the Master Users at the companies they have volounteered for and send them copies of the Password Application (PA) and Electronic Trading Agreement (ETA). During this week, we will be working hard to get as many of the PA's returned as possible. Once we have a signed PA, we can send the customer their new User ID, which will allow them to start trading on the day we launch the new site.

A Splash page will be available at www.UBSWenergy.com or via an automatic redirect from www.enrononline.com. This page will tell customers about the pending launch of www.UBSWenergy.com and provide links to the PA and Registration screens and also to the User Admin screens, which will allow customer Master Users to start setting up their Sub Users.

The Splash page will look something like the following:

Week of Feb. 4:

We will send out a mass mailing to approx. 3,000 individuals at 450 companies inviting them to sign up for the site. Included in the package will be a simple brochure, copies of the PA and ETA, key messages and a list of Frequently Asked Questions.

Week of Feb. 11:

The site will launch, with at least financial products (timing for gas physical and power physical to be determined according to regulatory issues).

General Terms and Conditions (GTC's) will be available online and must be accepted online before a company can start to trade a particular commodity.

Trading/Origination Coordination

The Top 50 customers will have at least an initial contact within the first two days of starting the marketing effort and that all customers who previously traded either gas or power will receive a mailing within the first 10 days. An online marketer has been assigned as coordinator for each company and will assist each Trader/Originator in following up with Master Users as necessary to make sure PA's are signed and returned.

UBSWenergy Marketing Contacts:

For Marketing-specific questions, please use the following contacts. For other questions, please contact Bob Shults (30397) or Dave Forster (31861).

Teresa Mandola (39807) - Power
Jennifer McQuade (53614) - Power
Dan Diamond (39673) - Gas

<Embedded Picture (Metafile)>


I'm not sure I agree with you.  There is a big difference between listing the
price for a reference entity's credit online (i.e. in a nearly public manner)
vs. providing a price quote to customers who request it.  The almost public
nature of the marketing  may influence whether or not the reference entity is
happy with Enron trading the product.  Even if they are not affected in this
way, having given them notice in advance will at least give us moral high
ground if the reference entity later decides to object.

Louise Kitchen
02/16/2000 03:49 PM
To: Bryan Seyfried/LON/ECT@ECT
cc: David Forster/LON/ECT@ECT, Mark Dilworth/LON/ECT@ECT, Paul
Goddard/LON/ECT@ECT, Mark Taylor/HOU/ECT@ECT
Subject: Re: letter to reference credits

Remove all references to EnronOnline its unnecessary in this context -
suffice to say you will be trading through all the normal Enron methods.

Louise

Bryan Seyfried
16/02/2000 20:24
To: David Forster/LON/ECT@ECT
cc: Louise Kitchen/LON/ECT@ECT, Mark Dilworth/LON/ECT@ECT, Paul
Goddard/LON/ECT@ECT

Subject: letter to reference credits

Attached is the letter that we intend to send to CFO/Treasurers of reference
credits.  The section on EnronOnline was recommended by Sullivan and Cromwell
and reviewed by Goddard, Dilworth and Simons.

There may be a few minor edits before it goes out.

Thanks

bs


After the Day ahead market ran, the PDCI (TNOB) branch group TTC in the
(S-N) direction was changed from 1904 MW to 1873 MW for HE's 0100 through
1200 for operating day 8/1/01.  The reason for the change is for work on the
Valve Group 6 at Sylmar.  The first applicable Hour Ahead market to run with
these values is HE 0600.  The ISO will update you of any changes in line
rating status.  Sent by Market Operations, inquiries please call the Hour
Ahead Desk.

The system conditions described in this communication are dynamic and
subject to change.  While the ISO has attempted to reflect the most current,
accurate information available in preparing this notice, system conditions
may change suddenly with little or no notice.


Please see the following articles:

Sac Bee, Wed, 7/11: Mediator talked of a bigger refund: He reportedly
suggested a $4.5 billion deal midway through the failed talks

Sac Bee, Wed, 7/11: Davis repeats threat to sue FERC to get full refund

Sac Bee, Wed, 7/11: Dan Walters: Davis plays in a virtual world while the
energy reality continues

Sac Bee, Wed, 7/11: Energy Digest: Ratepayer panel shot down again

Sac Bee, Wed, 7/11: Missing megawatts: Conservation saving state from
blackouts (Editorial)

SD Union, Wed, 7/11: Governor tells FERC to be fair and then some

SD Union, Wed, 7/11: Calpine says deal with state close on alleged overcharges

SD Union, Wed, 7/11: Judge refuses to let ratepayers form official committee
in utility
bankruptcy case

LA Times, Wed, 7/11: Judge Bars Ratepayers Panel From PG&E Case

SF Chron, Wed, 7/11: Developments in California's energy crisis

SF Chron, Wed, 7/11: Enron Corp. sues to block Senate from forcing document
release

SF Chron, Wed, 7/11: Governor threatens to sue utilities for refunds
Davis says California won't settle for $1 billion

SF Chron, Wed, 7/11: News briefs on the California power crisis

Mercury News, Wed, 7/11: White House bends under energy conservation pressure

Mercury News, Wed, 7/11: Davis ups the voltage  (Editorial)

OC Register, Wed, 7/11: Lights go out on Davis' power show   (Commentary)

------------------------------------------------------------------------------
------------------------------------------------------------------------

Mediator talked of a bigger refund: He reportedly suggested a $4.5 billion
deal midway through the failed talks.
By David Whitney
Bee Washington Bureau
(Published July 11, 2001)
WASHINGTON -- Midway through the negotiations between California and power
sellers to settle the myriad issues arising out of the state's energy crisis,
the mediator told California's negotiating team that he thought a deal worth
more than $4.5 billion would be appropriate -- a much higher figure than he
suggested after the talks ended Monday.
Whether the statement by Curtis Wagner, the chief administrative law judge
for the Federal Energy Regulatory Commission, was a negotiating ploy or a
reflection of his evolving beliefs is not clear.
Before the settlement talks began two weeks earlier, Wagner said he thought
Gov. Gray Davis' demand for $8.9 billion in refunds was too high and that a
settlement probably would be in the range of $2 billion to $2.5 billion.
The disclosure that Wagner had contemplated a much higher figure midway
through the negotiations suggests the state had more support than the judge
let on Monday when he said after the talks foundered that he thought a deal
should involve "hundreds of millions, maybe a billion" dollars.
While the state wants $8.9 billion, $3 billion of that was for overcharges
during the five months preceding last October and are beyond FERC's scope of
review. Even as a starting point then, the $4.5 billion mentioned by Wagner
represented 75 percent of the money the state was demanding for alleged price
gouging between October and May.
The judge's $4.5 billion figure, divided between cash payments and savings
from long-term power contracts, was confirmed by three sources who asked to
be identified only as "close to the negotiations" because participants had
been required to sign confidentiality statements.
The sources gave virtually identical accounts of a July 2 meeting with Wagner
in which the judge also dismissed as "inadequate" a $670 million settlement
offer made by power generators and marketers.
By Monday, the settlement offer had risen to $716 million. But the state
refused to back off its $8.9 billion demand, and there never was any serious
back-and-forth negotiations during the 15-day period the regulatory
commission had given Wagner to craft a deal.
As a consequence of the failed talks, Wagner said Monday that within a week
he will send the five-member commission his recommendations on how it might
approach an order refunding power overcharges.
Among Wagner's suggestions is that the commission convene a hearing before a
different administrative judge to take testimony from generators, marketers
and the state on how to arrive at a fair settlement.
The options sketchily outlined by Wagner on Monday included limiting the time
when refunds are allowed -- something that could reduce state claims by about
one-third -- and changing the way power plant costs are calculated to a
formula more favored by generators.
It is not clear whether Wagner, who moved from one negotiating team to
another during his two-week quest for a deal, ever raised the $4.5 billion
settlement figure to the power marketers and generators.
Joel Newton, who represented Dynegy Power, Duke Energy, Reliant Energy,
Williams-AES and Mirant in the talks, said Tuesday he was bound by the
confidentiality pledge to keep silent on the internal negotiations.
Wagner also is refusing all media calls.
According to the account of the negotiations confirmed by sources Tuesday,
Wagner was angry at the snail's pace of progress after the first week of the
talks.
On Friday, June 29, Wagner called everyone into his hearing room and scolded
them. He condemned the California team, saying they all ought to wear "clown
suits" because they were "in the pocket" of Davis and refused to show any
independence.
He then turned to the generators and said that after a week of talks, nothing
had been heard from them. He told them he wanted them to produce "real
numbers, and hard numbers" over the weekend and that if they didn't, he would
-- "and you're not going to like it."
Wagner's admonition apparently moved no one toward a deal. On Monday, in the
meeting with the California delegation, one source quoted Wagner as saying
the settlement number he received from the generators and marketers "is so
low I can't even present it to you."
"I'm not happy with the figures, they're not adequate," others quoted the
judge as saying.
At that point, the sources said, Wagner said he was thinking of a settlement
of $2.5 billion in cash, $2 billion in long-term contract savings and other
money from out-of-state investor-owned utilities and even the federal
Bonneville Power Administration, which markets power from dams in the
Northwest.
But as the clock wound down on the negotiations, nothing much happened until
Friday and Saturday, when the California team met with the five largest power
generators.
It was at those meetings that the generators offered $510 million in refunds
to settle their disputes with the state. But the money would have gone to
reduce the tab for what they were owed by the state and California utilities,
and it was loaded with conditions, including the state dropping all of its
investigations and lawsuits.
Wagner declared the talks over Monday, saying he was unable to bring the
parties together.

The Bee's David Whitney can be reached at (202) 383-0004 or
dwhitney@mcclatchydc.com.

Davis repeats threat to sue FERC to get full refund
By Emily Bazar
Bee Capitol Bureau
(Published July 11, 2001)
Gov. Gray Davis shot words of caution at federal regulators Tuesday, warning
that he will sue them if they order power companies to refund anything less
than the $8.9 billion he and other state officials have demanded.
The Democratic governor also lobbed threats at state legislators, suggesting
that he may call a special session to prevent them from embarking upon a
monthlong summer break next week.
Instead of vacationing, Davis said, lawmakers must work to approve an
agreement between the state and Southern California Edison that would save
the utility from bankruptcy.
Though the governor has indicated previously that the state may take the
Federal Energy Regulatory Commission to court, his announcement Tuesday made
it clear he intends to follow through.
Settlement talks with power generators to determine how much, if any, the
companies overcharged California for electricity concluded Monday with no
resolution.
Now, the decision rests with the FERC's governing board, and Davis said the
state won't back away from the $8.9 billion figure it demanded during talks.
"You order what you think is fair," Davis said during a news conference with
the state's top negotiators. "We'll take what you order, and we'll see you in
court."
Davis acknowledged that a legal battle could drag out for months or years.
He added that he believes the disagreement -- or even a protracted court
battle -- will not affect a tentative agreement between the state and Edison.
Under terms of the deal, money to pay off the utility's debt would come from
a state purchase of its transmission lines and from a portion of consumers'
electricity rates.
According to the agreement, the Legislature must approve the deal by Aug. 15,
and Davis said he intends to hold lawmakers to that date.
Davis said the deadline is important because creditor committees will
scrutinize the Legislature's every move to determine whether to force Edison
into bankruptcy court rather than await a political deal.
Legislators are scheduled to leave for summer recess July 20 and return Aug.
20.
Davis threatened to use his executive powers to force lawmakers to remain in
Sacramento and work on the Edison agreement, if necessary.

The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com.

Dan Walters: Davis plays in a virtual world while the energy reality continues

(Published July 11, 2001)
California still has a very real and very severe energy crisis, to wit:
The state is still running up massive debts as it pays more for power than it
can recover from ratepayers and is having trouble borrowing billions of
dollars to cover the debt.
There is a strong possibility, perhaps a probability, that when summer's heat
truly descends, there will be severe power blackouts as air conditioners
demand more juice than California can generate or buy.
One major utility, Pacific Gas and Electric, has filed for bankruptcy
protection and a second, Southern California Edison, is on the brink of
joining it.
There is, however, a virtual energy crisis consisting of political spin,
media leaks and made-for-television buzz words -- and it is rapidly becoming
dominant, while the real situation fades into the background.
This week's comic opera proceedings before a Federal Energy Regulatory
Commission administrative judge in Washington had little to do with reality
and everything to do with the virtual version.
Gov. Gray Davis and other officials demanded $8.9 billion in refunds from the
generators and brokers who have been selling California power for the past
year, alleging that California is, in Davis' words, "being gouged and ripped
off." But the number itself was more or less plucked out of thin air -- an
arithmetic exercise by the state power grid's traffic controller not intended
for a refund proceeding. And while Judge Curtis Wagner saw it as unrealistic,
Davis and other state officials insisted on its validity.
"There are refunds due that total hundreds of millions of dollars and maybe a
billion dollars," Wagner said as a final negotiating session collapsed. But
that's a far cry from the $8.9 billion that Davis insists is due. "If you
think California is going to settle for $1 billion in refunds, we will see
you in court," Davis said Tuesday.
Why is Davis being so belligerent? Because it's good politics. Ever since he
began berating out-of-state generators and accusing them of ripping off
California, Davis' approval ratings have been climbing. If he settled for
substantially less -- the power generators probably would agree to a couple
of billion dollars to rid themselves of the matter -- Davis would be
embarrassed. Politically, he's served by continuing to portray himself as
fighting for California and against the out-of-state generators.
That it's more political construct than reality is indicated by another event
this week, Davis' release of state power purchase data from early in the year
-- numbers that were made public only because a judge told him he had to do
it.
Davis and his minions have been accusing Texas-based generators and power
brokers of particularly egregious price gouging -- clearly playing on
Californians' instinctive mistrust of anything Texan and implying that Texan
George W. Bush is a co-conspirator. But the power purchase records -- which
were released only to journalists willing to pay a stiff fee -- indicate that
less than 10 percent of California's power purchase dollars were going to
Texas and the private sellers, in general, charged the state less than such
publicly owned utilities as the Los Angeles Department of Water and Power.
The clearly adverse position being taken by FERC and the purchase data that
undercut his jingoistic sloganeering are not, however, deterring Davis from
continuing to operate, at least for public consumption, in the melodramatic
virtual world.
One cannot, however, ignore reality forever. The likelihood of a
pro-generator decision from FERC means that there will be no easy out for
Davis, or for his pending deal to prevent Southern California Edison from
slipping into bankruptcy court. The Legislature has refused to act on the
Edison rescue plan while it awaited an indication of whether the utility's
debts would be slimmed down by FERC.
This week's farcical events make it more likely that the Edison deal will
stall out permanently in the Legislature and its creditors will force the
utility into bankruptcy court later this summer. That's part of that nasty
old reality that cannot simply be wished away.

The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.com
.

Energy Digest: Ratepayer panel shot down again

(Published July 11, 2001)
SAN FRANCISCO -- U.S. Bankruptcy Judge Dennis Montali on Tuesday reaffirmed
his earlier decision to disband a ratepayers committee that would have given
consumers an official voice in the Pacific Gas and Electric Co. bankruptcy
case.
The judge said bankruptcy court isn't the right forum for refunding rates or
settling potential future claims.
He eliminated erroneous statements from the opinion he originally issued
seven weeks ago. U.S. bankruptcy trustee Linda Ekstrom Stanley, who had moved
for reconsideration, called the new version "a very careful decision" but did
not rule out an appeal.
Stanley on May 4 appointed an official committee of ratepayers to represent
PG&E customers, saying they might be forced to pay for the utility's massive
losses.
--Claire Cooper

Missing megawatts: Conservation saving state from blackouts

(Published July 11, 2001)

A public that doesn't believe that California's electricity crisis is genuine
is nonetheless acting as if it is. Experts are revising down scary
predictions of rolling blackout after rolling blackout as Californians have
opted to conserve rather than consume.
During June, Californians cut back on electricity use by roughly 4,750
megawatts when it mattered the most, on hot afternoons. Those decisions
shaved about 12 percent from the expected demand. That's equivalent to the
output of nine or 10 medium-size power plants. Last June, grid operators had
to call six shortage alerts. This June, which was hotter, they called none.
For a state that's been derided as selfish and wasteful, that's nothing short
of amazing.
Some of what Californians are doing now to conserve isn't likely to become
habit in the long run. Businesses may want to turn back on all the banks of
lights. Homeowners may decide that 82 degrees is the right temperature when
power is short but too warm when California's supply emergency is over.
Yet there's a huge potential payoff into the future if some of these changes
become permanent. It's encouraging that the most effective forms of
conservation -- switching to more energy-efficient appliances or
manufacturing techniques -- have yet to be implemented on a large scale.
Subsidies for these programs have yet to translate into changes in businesses
and in homes that will lower demand even further.
For a while this spring, some attempted to diminish the role of conservation.
Conservation is a "personal virtue," said Vice President Dick Cheney. But
Californians know it's become both a personal and public necessity. The
public may have thought the electricity shortage was an illusion, but
everyone knew that the higher electricity bills that began arriving in June
were real. And so was the risk that the lights would go out on hot days.
Yes, the state needs more supply to catch up with the growth in demand. Yet
long after the crisis is over, there will be plenty of potential on the
efficiency side of the equation as well, to protect the quality of life and
reduce the high electricity costs that will likely plague the state for years.

Governor tells FERC to be fair and then some

Davis firm on demand for $8.9 billion refund
By Ed Mendel
UNION-TRIBUNE STAFF WRITER
July 11, 2001
SACRAMENTO -- Gov. Gray Davis had a tough message for federal regulators
yesterday after the failure of settlement talks in California's bid to get an
$8.9 billion refund from electricity suppliers: "See you in court."
The governor said California will seek a full $8.9 billion refund for
electricity overcharges, even if federal regulators award the maximum refund
of $5.4 billion allowed under their guidelines.
"Our message is just order what you are going to order," Davis said of the
Federal Energy Regulatory Commission. "We believe you should order $8.9
billion. But you order what you think is fair. We will take what you order,
then we will see you in court."
Davis, joined by his negotiating team, made the remarks at a news conference
a day after two weeks of closed-door talks with suppliers in Washington
failed to reach an agreement.
An administrative law judge made a recommendation to the regulatory
commission that Davis' top negotiator, Michael Kahn, chairman of the
California Independent System Operator, expects to result in a refund of more
than $1 billion.
Davis said that a revealing decision will be made by the commission, which he
hopes has embarked on a "new path" with the appointment by President Bush of
two new members, Pat Wood of Texas and Nora Brownell of Pennsylvania.
"Are they on the side of consumers, as the federal power act envisions them
being," Davis asked, "or are they just there to do the industry's bidding, as
they have so often in the past?"
Kahn said rules adopted by FERC cut off the refund period at last October,
trimming $3 billion from the $8.9 billion overcharge claimed by California
dating to May 2000.
He said FERC has no jurisdiction over municipal utilities, such as the Los
Angeles Department of Water and Power, that sold power to the state. The
municipal districts overcharged the state by about $600 million, according to
Kahn.
As a result, he said, the maximum refund that FERC could order for California
is about $5.4 billion.
"We made it clear to everyone that if we did not settle for $8.9 billion, we
would seek redress in court for the remainder of the money above $5.4
billion," Kahn said.
Calpine of San Jose and several other generators have expressed interest in
the state's offer to negotiate one-on-one with the state while the federal
regulators consider their decision, Kahn said.

Calpine says deal with state close on alleged overcharges

By Don Thompson
ASSOCIATED PRESS
July 10, 2001
SACRAMENTO ) Calpine Corp. said Tuesday it is near agreement with California
officials over money the state says the company overcharged for electricity.
That would make it the first company to settle a part of the $8.9 billion the
state wants in negotiations before the Federal Energy Regulatory Commission.
However, San Jose-based Calpine has offered far less than the $236 million
the state claims it is owed.
"We obviously disagree with that number, because we disagree with some of the
assumptions" used for the estimate, said Calpine spokesman Bill Highlander.
"We don't think it's anywhere near that. We think it's a low number."
He wouldn't specify the company's counteroffer, but noted new FERC figures
showing the company did $29 million in business with the state in the first
five months of this year.
The California Independent System Operator estimated the company owed more in
overcharges than it had in total sales for the period from May 2000 to May
2001, a financial impossibility, Highlander said.
The ISO essentially multiplied what Calpine was able to produce by the amount
it charged for electricity, Highlander said, without taking into account how
much electricity the company actually sold.
ISO spokesman Michael Bustamante defended the projections by the state's grid
operator, estimates he said were validated during two weeks of FERC
negotiations that ended Monday. The ISO took the methodology adopted by the
federal regulator in a June 19 order capping electricity rates, then worked
backward to May 2000 to reach its estimate, Bustamante said.
Generators and state negotiators were unable to reach a settlement during the
two weeks of talks overseen by FERC chief administrative law judge Curtis L.
Wagner, leaving Wagner to make his own recommendation to the commission.
Wagner said Monday the state may be owed perhaps $1 billion in overcharges,
but said that could be offset by money the generators are owed for the power
they sold into the state.
California officials believe generators owe about $4 billion in refunds using
the June 19 order that Wagner adopted as his benchmark, even given Wagner's
determination that the commission can only consider overcharges after Oct. 2.
At one point during negotiations, Wagner told California officials he thought
an appropriate settlement should top $4.5 billion, according to one
negotiator who spoke on condition he not be named. Wagner suggested
generators could pay $2.5 billion in cash and $2 billion in long-term
electricity contracts at cheaper rates, the source said.
That was very different from the $670 million in refunds Wagner privately
said generators were offering. For instance, the source said, while Reliant
Energy on Monday offered $50 million in refunds, California believes
Reliant's share of overcharges is closer to $1 billion.
Jan Smutny-Jones, executive director of the Independent Energy Producers,
applauded the possibility that some generators will settle with the state
without waiting for a FERC decision and likely protracted court battle.
"We need to solve this problem and move on," Smutny-Jones said.
??
)
Associated Press writer Mark Sherman contributed to this story from
Washington, D.C.

Judge refuses to let ratepayers form official committee in utility bankruptcy
case

ASSOCIATED PRESS
July 10, 2001
SAN FRANCISCO ) The federal judge overseeing Pacific Gas and Electric Co.'s
bankruptcy case ruled Tuesday the utility's ratepayers cannot form an
official committee to represent their interests.
Ratepayer advocates had sought such recognition to ensure the utility would
not raise rates further as a way of paying off its debts.
But U.S. Bankruptcy Judge Dennis Montali agreed with PG&E and the official
creditors committee and rejected the idea for the second time in two months.
Montali suggested instead that ratepayers organize an informal committee to
bring their concerns to the court, and said the ratepayers also could bring
matters before the state Public Utilities Commission.
A separate committee of ratepayers would have been able to vote on the final
reorganization of the company, a plan that could affect power service and
rates.
PG&E filed for Chapter 11 bankruptcy April 6, and owes billions of dollars to
more than 50,000 creditors. It was brought down, in part, by California's
botched experiment with deregulation.

Judge Bars Ratepayers Panel From PG&E Case
Power: Customers are not creditors in the utility's bankruptcy, ruling says.
Action does not preclude refunds for consumers.
TIM REITERMAN
TIMES STAFF WRITER

July 11 2001

SAN FRANCISCO -- A federal judge Tuesday reaffirmed his decision to bar a
ratepayers committee from Pacific Gas & Electric Co.'s bankruptcy case and
denounced the committee's attorney for suggesting that the action could
prevent PG&E customers from receiving refunds for excessive energy charges.

Judge Dennis Montali ruled against a U.S. trustee and the ratepayers
committee in deciding that ratepayers as a group had no claims and were not
creditors when PG&E filed for bankruptcy on April 6.

But Montali criticized "misguided remarks" by a committee attorney on July 5
and news media accounts that followed the hearing. The judge said the reports
left the misconception that by disallowing a ratepayers committee, he would
reject all claims of ratepayers and they could lose out on future refunds.

The judge and PG&E officials emphasized that there are no matters involving
PG&E customer refunds before the state Public Utilities Commission.

State officials are seeking about $9 billion in refunds, however, from the
Federal Energy Regulatory Commission for alleged overcharges to Californians
by energy companies since last year.

The distribution of any ratepayer refunds would be decided by the PUC, and
customers would be paid whether or not they filed Bankruptcy Court claims by
a Sept. 5 deadline, the judge and PG&E attorneys said.

The judge took the highly unusual step of directing PG&E and U.S. Trustee
Linda Ekstrom Stanley to consider remedies to allay any confusion among
PG&E's 5.5 million customers.

He suggested publishing clarifications in newspapers that carried the
erroneous information, in PG&E customer bills and on Web sites.

Stanley had formed a ratepayers committee of business, government and
consumer representatives, saying they will be affected by PG&E's Chapter 11
reorganization.

But Montali decided that ratepayers do not qualify as creditors under
bankruptcy law and are not entitled to official status that allows them to
participate in the bankruptcy and receive funding from PG&E.

Stanley said she has not yet decided whether to appeal the ruling to federal
district court.
Copyright 2001, Los Angeles Times

Developments in California's energy crisis
The Associated Press
Wednesday, July 11, 2001
,2001 Associated Press
URL:
http://www.sfgate.com/cgi-bin/article.cgi?file=/news/archive/2001/07/11/state1
036EDT0129.DTL
(07-11) 07:36 PDT (AP) --
Developments in California's energy crisis:
WEDNESDAY=
* No power alerts Wednesday as electricity reserves stay above 7 percent.
TUESDAY=
* U.S. Bankruptcy Judge Dennis Montali again agreed with PG&E and the
official creditors committee, saying such a committee of Pacific Gas and
Electric Co. ratepayers has no legal standing in bankruptcy court. Ratepayer
advocates had sought the recognition to ensure the utility would not raise
rates further as a way of paying off its debts.
* PG&E has agreed to pay $4.1 million in tax penalties to 49 counties where
the utility owns property. The utility already paid $41.2 million in overdue
property taxes in May -- the additional amount covers a 10 percent fee for
paying those taxes late.
* Calpine Corporation says it is near agreement with California officials
over money the state says the company overcharged for electricity. That would
make it the first company to settle a portion of the $8.9 billion dollars the
state is seeking in proceedings before the Federal Energy Regulatory
Commission. But the San Jose-based company is offering much less than the
$236 million dollars the state claims it is owed.
* No power alerts Tuesday as electricity reserves stay above 7 percent.
* Shares of Edison International closed at $14.05, up 5 cents. PG&E Corp.
drop 55 cents to close at $13.55. Sempra Energy, the parent company of San
Diego Gas & Electric Co., closed at $27.67, up 15 cents.
WHAT'S NEXT=
* The Senate committee investigating possible price manipulation in
California's energy market meets Wednesday. The committee will vote on
contempt citations against generators Mirant and Enron, which failed to
comply with subpoenas for documents. The committee will meet again July 18 to
consider compliance by six other suppliers that have until Tuesday to turn
over documents.
THE PROBLEM:
High demand, high wholesale energy costs, transmission glitches and a tight
supply worsened by scarce hydroelectric power in the Northwest and
maintenance at aging California power plants are all factors in California's
electricity crisis.
Southern California Edison and Pacific Gas and Electric say they've lost
nearly $14 billion since June 2000 to high wholesale prices the state's
electricity deregulation law bars them from passing on to consumers. PG&E,
saying it hasn't received the help it needs from regulators or state
lawmakers, filed for federal bankruptcy protection April 6. Electricity and
natural gas suppliers, scared off by the companies' poor credit ratings, are
refusing to sell to them, leading the state in January to start buying power
for the utilities' nearly 9 million residential and business customers. The
state is also buying power for a third investor-owned utility, San Diego Gas
& Electric, which is in better financial shape than much larger Edison and
PG&E but is also struggling with high wholesale power costs.
The Public Utilities Commission has approved average rate increases of 37
percent for the heaviest residential customers and 38 percent for commercial
customers, and hikes of up to 49 percent for industrial customers and 15
percent or 20 percent for agricultural customers to help finance the state's
multibillion-dollar power buys.
Track the state's blackout warnings on the Web at
www.caiso.com/SystemStatus.html.
,2001 Associated Press ?

Enron Corp. sues to block Senate from forcing document release
DON THOMPSON, Associated Press Writer
Wednesday, July 11, 2001
,2001 Associated Press
URL:
http://www.sfgate.com/cgi-bin/article.cgi?file=/news/archive/2001/07/11/state1
212EDT0141.DTL
(07-11) 09:12 PDT SACRAMENTO (AP) --
Enron Corp. is suing state officials to stop a Senate subpoena of its
financial records in a dispute over alleged overcharges for its electricity
sales to California.
"They've sent two things to Texas -- our money and these documents, and they
saying we can't get either one back," said Laurence Drivon, special legal
counsel to the Senate Select Committee to Investigate Market Manipulation.
The suit came hours before the committee will consider asking the full Senate
to cite the Houston-based company for contempt Wednesday. The other subject
of possible sanctions, Atlanta-based Mirant Inc., appears to be cooperating,
Drivon said.
Committee chairman Joe Dunn, a Santa Ana Democrat, said the committee's
investigation will continue despite Enron's "pure act of intimidation. We're
not going to back down."
Enron's suit said the company's financial papers are outside the committee's
jurisdiction because most of its operations and paperwork are outside
California.
That shouldn't matter, Drivon said, citing last year's successful of
out-of-state documents during the investigation into the activities of former
Insurance Commissioner Chuck Quackenbush. Previous investigations have
included documents subpoenaed from other nations, he said.
Companies doing business in California cannot claim immunity from its laws or
oversight, Drivon and Dunn said. Houston-based Reliant Energy made the same
argument but then agreed to turn over 1,800 documents.
,2001 Associated Press ?

Governor threatens to sue utilities for refunds
Davis says California won't settle for $1 billion
Mark Martin, Chronicle Staff Writer
Wednesday, July 11, 2001
,2001 San Francisco Chronicle
URL:
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/07/11/M
N139275.DTL
Sacramento -- One day after a federal judge rebuked California's claim that
energy generators owe the state $8.9 billion, Gov. Gray Davis all but vowed
to sue the companies to recoup the money.
"If you think California will settle for $1 billion in refunds, we'll see you
in court," Davis said yesterday.
Continuing his heated rhetoric on the energy crisis, Davis blasted the energy
companies for being inflexible during a 14-day negotiation session in
Washington, D.C., that ended Monday. Both the state and power generators
argue each is owed money as a result of California's dysfunctional
electricity market.
Federal Energy Regulatory Commission chief administrative law Judge Curtis L.
Wagner ended the talks by saying the state was owed far less than it claimed,
but the FERC's governing board will make a final decision on who owes what to
whom in the coming months.
Yesterday, Davis made it clear he wouldn't accept a FERC decision that
strayed far from the state's calculations that power companies overcharged
California nearly $9 billion.
"The ball is in the FERC's court," he said. "They must step up and provide
the refunds we've asked for."
While Davis said California officials had gone to Washington prepared to
discuss ways to reach a settlement, including renegotiating long-term
contracts to buy power, an energy industry official faulted the state for its
unwillingness to compromise.
Generators put forward an offer even though they believe no refunds are owed,
said Jan Smutny-Jones, executive director of the Independent Energy
Producers.
Smutny-Jones said the state needed to stop thinking it would get the $8.9
billion.
"It's clear from the way the issue was characterized by the judge that $9
billion is not something the state is going to see any time in the near
future, " he added. "It is not based in reality."
Davis also took heat from Republicans yesterday.
"He desperately needs that refund, so he can renegotiate the dreadful
contracts he has entered into," said Rob Stutzman, a consultant for the
California Republican Party. "He's sitting at the poker table with very few
chips."
In other energy news yesterday, a judge refused to let a committee represent
the public in the Pacific Gas & Electric Co. bankruptcy case and said a
consumer lawyer's "irresponsible position" at a hearing last week could
mislead PG&E customers into filing needless refund claims with the court.
U.S. Bankruptcy Judge Dennis Montali said any refunds owed to customers were
unrelated to the bankruptcy case and would be determined by regulators.
At the hearing Thursday, attorney KaarenThomas argued that unless a committee
represented customers' interests, PG&E could try to bar all refund claims
that weren't filed by Sept. 5.
Montali ruled in May that the committee was not authorized by federal
bankruptcy law, and reaffirmed his ruling yesterday.
Chronicle staff writers Lynda Gledhill and Robert Egelko contributed to this
report.
E-mail Mark Martin at markmartin@sfchronicle.com.
,2001 San Francisco Chronicle ? Page?A - 3

News briefs on the California power crisis
The Associated Press
Wednesday, July 11, 2001
,2001 Associated Press
URL:
http://www.sfgate.com/cgi-bin/article.cgi?file=/news/archive/2001/07/11/state0
738EDT0118.DTL
(07-11) 04:38 PDT SAN JOSE, Calif. (AP) --
Energy supplier Calpine Corp. has reached a deal to purchase 236 billion
cubic feet of natural gas in Texas and New Mexico for $355 million plus
assumption of nearly $50 million of debt.
Company officials made the announcement Tuesday and said the purchase will
increase its natural gas reserves.
"This transaction meets our desire to own and operate production in a
strategic basin," said Cathy Piece, Calpine's director of land and
acquisitions. "These assets significantly strengthen our reserve base and
will help fuel our growing Western power program."
The San Jose-based company has agreed to purchase 35 wells in New Mexico that
produce 6 million cubic feet of gas per day from The Bayless Companies. The
second transaction involves the acquisition of a majority interest of Michael
Petroleum of Houston. The Texas company produces about 43 million cubic feet
of gas per day.
Calpine officials said the agreements will allow them to meet their future
capacity demands for both natural gas and electricity. The company wants to
generate more than 70,000 megawatts of electricity by the end of 2005 and
have natural gas reserves of 6.7 trillion cubic feet.
LOS ANGELES (AP) -- Newly elected Mayor James Hahn has postponed selling the
city's surplus power to the state so he can examine how it will impact
ratepayers.
Hahn's predecessor, Richard Riordan, said last month the city's Department of
Water and Power would sell its extra electricity -- about 500 megawatts a
day_ to the state at cost between July and September.
The contract was supposed to have been signed last week.
Steve Maviglio, a spokesman for Gov. Gray Davis, said Tuesday that the state
is ready to sign the contract.
"We're ready to sign," he said. "Like most negotiations that aren't final,
things go back and forth. The new (Hahn) administration wants to review the
document before it."
Davis had threatened to seize surplus power from municipal utilities, which
haven't been subjected to the California energy crisis, because he claimed
they were gouging the state.
TEMECULA, Calif. (AP) -- State officials said they are studying alternative
routes for a power transmission line proposed by San Diego Gas and Electric
Co.
The utility wants to run a 500,000-volt power line through southwestern
Riverside County connecting its power grid with Southern California Edison's.
The cost of the project is estimated at $271 million and must be approved by
the state's Public Utilities Commission.
But state officials listed alternative routes in papers released at a public
hearing Tuesday. Some of the other ideas include putting the transmission
line around the edges of an Indian reservation or running a route through the
Cleveland National Forest.
Once a final selection is made, the information will be given to PUC
commissioners who will either approve or deny the project.
Many residents who live in the path of the proposed transmission line don't
want the project. An attorney representing several groups that oppose SDG&E's
plans said there was no mention of alternative routes in environmental
documents submitted by the company.
"Looking at the various route segments offered by SDG&E as alternatives is
like trying to arrange the deck chairs on the Titanic," said attorney Mark
Mihaly.
,2001 Associated Press ?

White House bends under energy conservation pressure
Posted at 6:25 a.m. PDT Wednesday, July 11, 2001
BY H. JOSEF HEBERT

Associated Press Writer

WASHINGTON (AP) -- Under pressure to include more conservation measures that
reduce energy use, congressional Republicans are moving toward a compromise
to increase fuel efficiency requirements for sport utility vehicles as part
of an energy package.
Key House GOP lawmakers said Tuesday they expect some increase in fuel
economy requirements, especially for SUVs, in energy legislation working its
way through the House. Democrats, who have a majority in the Senate, also
favor requiring improved motor vehicle fuel efficiency.
At the same time, the Bush administration signaled its willingness Tuesday to
begin a rule-changing process that would allow the first increase in 25 years
in the federal corporate automobile fuel economy, or CAFE, standard.
Transportation Secretary Norman Mineta asked Congress to lift immediately a
six-year prohibition that bans the department from consideration of fuel
economy increases. Lawmakers already agreed this year not to extend the ban
beyond September, but Mineta said he wants to start examining possible
changes right away.
CAFE standards, which mandate fuel economy requirements for vehicle fleets,
have not been increased since their introduction in 1975. That year's law,
spurred by energy shortages in the early 1970s, required passengers cars to
meet a fleet average of at least 27.5 miles per gallon. Light trucks -- a
category that includes SUVs, vans and pickups -- have to meet a 20.7 mpg
fleet average.
With the widespread popularity of SUVs and vans in recent years, many
environmentalists have argued that the lower truck standard has compromised
the intent of the 1975 law. SUVs and vans comprise more than 40 percent of
the passenger vehicles on the road today.
As three committees began crafting energy legislation, lawmakers were
searching for a bipartisan compromise to increase fuel economy requirements
for motor vehicles. Some increase in the CAFE requirement was virtually
assured, several GOP lawmakers said, although disagreements remain on how
much of an increase, whether it should apply to automobiles as well as SUVs,
vans and small trucks, and the timetable for phasing in new requirements.
Energy legislation that the House Energy and Commerce Committee was taking up
later Wednesday contains no fuel economy provision.
But Rep. Billy Tauzin, R-La., the committee chairman, said discussions were
under way to work out a compromise on a fuel economy proposal. He said he
expects an amendment on CAFE to be added to the bill, either during
deliberations in his committee or on the House floor.
Rep. Joe Barton, R-Texas, chairman of the subcommittee drafting the energy
package, saw a good chance the truck standards will be raised and said the
automobile standard might be increased as well. Other GOP sources who talked
about the private discussions on condition of not being identified by name
said a likely outcome is that the truck standard will be increased three or
four mpg and the auto standard left alone.
Momentum for some CAFE increase has been growing in recent weeks as GOP
lawmakers came under increasing pressure to come up with additional
conservation proposals to those proposed in the White House's energy policy.
It largely focuses on production, with few specific measures to dramatically
curb energy demand.
Democrats have pressed for tougher automobile fuel economy standards.
Automakers have fought attempts to increase the standards. They say such
government edicts limit consumer choice and force manufacturers to build
smaller cars that customers don't want. Supporters of increased fuel economy
argue that new technologies are available to increase fuel efficiency without
decreasing vehicle size.
President Bush's energy blueprint would consider CAFE increases, but not
before a National Academy of Sciences report is issued, probably this month,
on impact of the standard on energy savings, safety and auto industry
competition.

Davis ups the voltage
Published Wednesday, July 11, 2001, in the San Jose Mercury News
Vow to sue for refunds may be a bluff, but he should keep pushing FERC
THE strategic choice facing Gov. Gray Davis in the struggle over electricity
price refunds has come down to three questions: When do you negotiate, when
do you demand, and when do you bluff?
Negotiations are over, Davis declared Tuesday. He demanded that the Federal
Energy Regulatory Commission order refunds now. ``The case is nearly a year
old,'' he said. ``They have to decide which side they're on.''
Probably no one but Davis knew to what extent he was bluffing when he also
said, ``If you think California is going to settle for $1 billion in refunds,
we will see you in court.''
A FERC administrative judge said Monday that the amount due the state may be
around $1 billion, or perhaps nothing at all, when counter-claims against the
state are subtracted.
Energy experts are divided about whether the state would win a suit to
overturn a decision by a federal commission. The federal courts have some
limited jurisdiction, according to University of California Energy Institute
director Severin Borenstein, but that a court would reverse a commission in a
case like this is ``extremely unlikely.''
Frank Wolak, a Stanford economist, had the opposite view, when asked whether
the state has a good chance of winning: ``I think so. It happens all the
time.''
At a Sacramento press conference, Davis continued to insist that there have
been overcharges of $8.9 billion. But other state officials conceded that
only $5.4 billion of that is actually on the table in the FERC proceedings.
Davis said he'll take what he can get there, and sue for the rest.
The state argues that because FERC has determined that wholesale prices have
not met the Federal Power Act's requirement to be ``just and reasonable,''
refunds are in order. But the commission has not defined what portion
exceeded ``just and reasonable.''
Throughout his press conference, Davis used the prospect of litigation like a
goad to spur the federal regulators into action. But if you listened
carefully, he also indicated he'll give them more time to consider the case.
Considering the iffy odds of winning in court, we suggest he keep goading the
federal commissioners -- while giving them all the time they need.

Wednesday, July 11, 2001

Lights go out on Davis' power show
Three new developments show that some economic reality finally is being
applied to California's electricity crisis:
First, "The nation's chief energy judge said Monday that California is owed
maybe $1 billion in refunds from power generators, a fraction of the $8.9
billion demanded by Gov. Gray Davis," reported the Register yesterday. Even
that $1 billion amount might be balanced by the amount the state still owes
the power producers.

To suggest workable and market-oriented solutions to the California
electricity crisis.

Judge Curtis Wagner's recommendation will be taken up by the Federal Energy
Regulatory Commission, which is being petitioned for the money by the state
of California.
Because the judge's words will bolster FERC's apparent desire not to grant
the "refunds," the state probably will go to court, where the matter could be
stuck for years.
"In the long term, this may indicate that competitive electricity has a
future even in California, but not thanks to the state," Robert Michaels, a
professor of economics at Cal State Fullerton, told us. He's referring to the
state's botched 1996 "deregulation" effort, which has been made worse by Gov.
Gray Davis and other officials since the crisis began a year ago.
"FERC since the 1980s favors competition, within the parameters of political
reality," Mr. Michaels added. "Now we're at square one: The industry doesn't
owe $9 billion to California." As this process continues, he said, another
positive aspect will be that a lot of facts will get aired. "We'll see what
has been happening in the markets" in which power is bought and sold.
Second, light already is shining on one area: This crisis was not "Made in
Texas'' by cronies of President Bush, as Gov. Davis and other Democrats have
been contending.
In May, the governor attacked the president for ignoring "the greed of these
Texas energy companies," such as Reliant and Dynergy.
In fact, according to information on state power contracts the governor
finally released Monday, Texas companies were way down on the list of
producers.
"In roughly the first five months of the year, the state shelled out $1.2
billion to Atlanta-based Mirant, the most any company was paid for
electricity, followed by $1 billion to Powerex, the marketing arm of BC Hydro
in British Columbia [in Canada]. It also paid $331 million to the Los Angeles
Department of Water and Power," reported the San Jose Mercury News.
Only about 10 percent of our state's power during this period came from
companies with headquarters in Texas.
Third, and finally, a new study by the Cato Institute shows what should be
done next:
lAbolish retail rate caps, allowing prices to be set by the market.
This would be a better system than the present one, where the state buys the
electricity and passes much of the cost along through the state budget (paid
by taxpayers) and bonds paid for by long-term electricity price increases.
Higher immediate prices would encourage conservation and production, leading
in time to lower prices.
lMove to real-time pricing so people shift activities such as washing to
off-peak hours.
lAbolish the Independent System Operator, which moves electrons around.
Give this function back to the utilities, who did it far better before
"deregulation." Gov. Davis should set the pace by ending his Clintonian blame
shifting and embracing these realistic solutions.


Best of Luck, Mary.  Don't let them make California mistakes Down-East
style!  Call if you ever need any thing from the left coast.  Mike Day

-----Original Message-----
From: Mary.Hain@enron.com [mailto:Mary.Hain@enron.com]
Sent: Friday, March 23, 2001 10:24 AM
To: David_Aamodt@pgn.com; dapnucc@teleport.com; dick@pnucc.org;
seabron.adamson@frontier-economics.com; Frank_Afranji@pgn.com;
raa@vnf.com; Joseph.Alamo@enron.com; ajaldrich@snopud.com;
Jeff.Alexander@enron.com; Al.Alexanderson@enron.com;
Keonee.Almaida@enron.com; hollis.alpert@ferc.fed.us;
Brenda.Anderson@enron.com; angles@howry.com; Alan.B.Aronowitz@enron.com;
gdb@vnf.com; npbaker@bpa.gov; ellen@tca-us.com; paulb@citizenspower.com;
paulb@citizenspower.com; garybarbour@email.msn.com;
jbartus@cammckenna.com; glynda.becker@mail.house.gov;
Samuel.Behrends@enron.com; bbennett@bpa.gov; sberman@hewm.com;
ramsen.betfarhad@mail.house.gov; KBILAS@SKADDEN.COM; sbooye@Skadden.com;
raymond.r.boyce@state.or.us; tbradley@bracepatt.com;
scott.brattebo@pacificorp.com; sbrose@steptoe.com;
sbuchheit@bracepatt.com; alanb@wutc.wa.gov; Jim.Byrne@enron.com;
vergil.cabasco@mail.house.gov; johncameron@dwt.com;
Doug.Carmichael@enron.com; Ed.Cassidy@enron.com; ajchambe@llgm.com;
Melissa.Chiechi@enron.com; elchristensen@snopud.com;
kevin.clark@ci.seattle.wa.us; rcloward@avistacorp.com;
david_cohen@rniinc.com; Bill.Comish@enron.com;
Victor.Contract@enron.com; powerlac@aol.com;
Frederick.Coolbroth@enron.com; michaelcorrigan@bchydro.bc.ca;
kcorum@nwppc.org; KCurry@bracepatt.com; wcurry@enron.com;
gdahlke@paine-hamblen.com; kadaly@mcimail.com; mday@gmssr.com;
dearing@chelanpud.org; tdeboer@paine-hamblen.com; Tom_Delaney@enron.com;
sdleonard@earthlink.net; dldorrell@stoel.com; Mary.Doyle@enron.com;
Jay.Dudley@enron.com; mce2280@idahopower.com;
michaelearly@earthlink.net; Katherine.Edwards@enron.com;
rle@givenspursley.com; imaxtrans@aol.com; Chris.Elliott@enron.com;
sandra.elliott@ferc.fed.us; kerwin@ect.enron.com; dezickson@mwe.com;
Jim.Fallon@enron.com; fallonr@howrey.com; Elias.Farrah@enron.com;
Michele_Farrell@pgn.com; dfaulk@puget.com; gfergus@brobeck.com;
Willard.Fields@enron.com; sfisher@avistaenergy.com; pfox@bracepatt.com;
Pat.Franklin@enron.com; John.Frazzell@enron.com; ericf@prestongates.com;
don.furman@pacificorp.com; segfurst@bpa.gov; Jackie.Gallagher@enron.com;
craiggannett@dwt.com; Alvaro.Garcia@enron.com; sbishop@gibbs-bruns.com;
wgibson@nwppc.org; ggilbert@ci.tacoma.wa.us; Pat.Gilman@enron.com;
Alex.Goldberg@enron.com; jlgreene@energyadvocates.com;
Chris_Groener@mail.house.gov; Mary.Groggin@enron.com;
Mark.E.Haedicke@enron.com; Stephen.Hall@enron.com;
steve.c.hall@enron.com; Leo.Hamblin@enron.com; whannaford@NWPPC.org;
jim.harding@ci.seattle.wa.us; rhardy@hardyenergy.com; kharri@puget.com;
Steve_Hawke@pgn.com; dhawkins@caiso.com; marc.hellman@state.or.us;
Scott.Helyer@enron.com; mhenry@bracepatt.com; dwmp@teleport.com;
rhornby@tca-us.com; mhornst@aol.com; dhuard@jmbm.com;
Marlene.Huntsinger@pgn.com; cfi1@tca-us.com;
Richard.Ingersoll@enron.com; pljacklin@stoel.com; montrey@aol.com;
danj@cfmdc.com; kgjohnson@bpa.gov; ljohnson@pwrteam.com;
Karen.E.Jones@enron.com; mkanner@kannerandassoc.com;
karid@perkinscoie.com; pkaufma@ect.enron.com; Paul.Kaufman@enron.com;
Jeffrey.Keeler@enron.com; Devon Kehoe; James.Keller@enron.com;
Joe.Kelliher@mail.house.gov; kkennedy@bdbc.com; Rick.Kessler@enron.com;
rdking@bpa.gov; Harry.Kingerski@enron.com; Harry.Kingerski@enron.com;
rsk@schwabe.com; gwilliams8@austin.rr.com; John.Klauberg@enron.com;
Holli.Krebs@enron.com; ekrogh@wiredweb.com; blafferty@avistacorp.com;
wdlamb@bpa.gov; John.Lamb@enron.com; Therese.Lamb@enron.com;
srlarson@bpa.gov; Cindy_Tatham@co.washington.or.us;
zora.lazic@bchydro.com; kaleathley@bpa.gov; pamela_lesh@pgn.com;
Debi.LeVine@enron.com; lcg@europa.com; doug.little@powerex.com;
Robert.Loeffler@enron.com; Chris.Long@enron.com; sjlong@bpa.gov;
rlopezv@www.conet.com.mx; david_lucio@iep.illinova.com;
king.lum@bchydro.bc.ca; kevin.lynch@pacificorp.com;
Mark.Maehr@enron.com; Randal.T.Maffett@enron.com;
John.Malowney@enron.com; Sueyen.Mao@enron.com; Susan.J.Mara@enron.com;
Susan.J.Mara@enron.com; Lee.Martin@enron.com; maurw@perkinscoie.com;
Wayne.Mays@enron.com; Michael.McCall@enron.com;
Sandra.McCubbin@enron.com; Travis.McCullough@enron.com;
Michael.McDonald@enron.com; brugen@erols.com; mckinley@wpuda.org;
mcm@vnf.com; mcnichol@wapa.com; shauna@pnucc.org;
Maureen.McVicker@enron.com; pmeringolo@brobeck.com; demetcalf@bpa.gov;
cemeyer@bpa.gov; jmilegich@sppc.com; fred_miller@pgn.com;
Jeffrey.Miller@enron.com; jerry.miller@pacificorp.com;
Laura.Miller@enron.com; scott.miller@ferc.fed.us; Bill.Miner@enron.com;
phil_moeller@gorton.senate.gov; pmohler@hewm.com; emoler@velaw.com;
nkmorgado@bpa.gov; Mike@tonkon.com; krmoxness@bpa.gov;
mmps@millcreeklaw.com; pmurphy@mbllp.com; terrym@millcreeklaw.com;
bmurtha@acy.sunint.com; Rich.Nassief@enron.com; tod@mgninc.com;
Douglas_Nichols@pgn.com; Patty.Nichols@enron.com;
Christi.Nicolay@enron.com; tmnoguchi@bpa.gov; darcy@tonkon.com;
Sarah.Novasel@enron.com; Sarah.Novosel@enron.com;
Tom.O'Donnell@enron.com; PObenchain@idahopower.com; Pegy.Olds@enron.com;
Carol.Opatrny@enron.com; tpaine@avistacorp.com; Dave.Parquet@enron.com;
bpascoe@mtpower.com; afpaschke@bpa.gov; ccperigo@bpa.gov;
wlpernas@stoel.com; lpeters@pacifier.com; jill@pnucc.org;
Mona.L.Petrochko@enron.com; npickover@bracepatt.com;
Phillip.Platter@enron.com; Alfred.Pollard@enron.com;
Walt.Pollock@enron.com; gporter@sppc.com; Kevin.M.Presto@enron.com;
jquint@puget.com; arlene.ragozin@ci.seattle.wa.us; maraschio@bpa.gov;
Dale.Rasmussen@enron.com; Scott.Rasmussen@enron.com;
Bobby.Reeves@enron.com; preiten@pngc.com; reyna2r@kochind.com;
shellyr@pacifier.com; Jeff.Richter@enron.com; raroach@bpa.gov;
atrodrigues@bpa.gov; rarogers@bpa.gov; peterroi@erols.com;
Rothfelder@rlo-law.com; Richard.Sanders@enron.com; jsaven@pacifier.com;
Michael.Schilmoeller@enron.com; jschlect@avistacorp.com;
Sabine.Schnittger@frontier-economics.com; Diana.Scholtes@enron.com;
Roger.Seifert@enron.com; Cara.Semperger@enron.com;
asettanni@bracepatt.com; Richard.Shapiro@enron.com; vsharp@enron.com;
msmith1@enron.com; Joshua.Sheinkman@enron.com; jshurts@nwppc.org;
Sid@enron.com; msizer@ci.tacoma.wa.us; slavens.paula@deps.ppl.com;
small@wrightlaw.com; small@wrightlaw.com; douglas.smith@ferc.fed.us;
Mike.Smith@enron.com; Roger.Smith@enron.com; Larry.Soderquist@enron.com;
Harvey.Spigal@enron.com; mstauffer@mtpower.com;
James.D.Steffes@enron.com; James.D.Steffes@enron.com;
mestewardpsedc@worldnet.att.net; JKStier@BPA.gov;
rbstrong@paine-hamblen.com; DASwanstrom@Verner.com;
Mike.Swerzbin@enron.com; tabors@tca-us.com; Ron.Tapscott@enron.com;
James.K.Tarpey@enron.com; Jake.Thomas@enron.com;
ryan_thomas@burns.senate.gov; jrt2058@idahopower.com; maryann@pnucc.org;
mtierney@sempra.com; robin_tompkins@pgn.com; Ann.Tumlinson@enron.com;
AW.Turner@enron.com; Sheila.Tweed@enron.com; Lisa.Urick@enron.com;
rvermeers@avistacorp.com; Frank.W.Vickers@enron.com;
John.Walley@enron.com; kristiwallis@sprintmail.com; walshl@howrey.com;
swalton@enron.com; Steve.Walton@enron.com; kaward@bpa.gov;
Kim.Ward@enron.com; Carol.Wardell@enron.com; dwatkiss@bracepatt.com;
sawatson@bpa.gov; judy.welch@NWPP.ORG; 211-6155@MCIMAIL.COM;
Kwenzel@zzz.com; cwestadt@sppc.com; Brian.Whalen@enron.com;
Bill.Williams@enron.com; klwmtp@worldnet.att.net; lyn_williams@pgn.com;
Greg.Wolfe@enron.com; Vickie.Wolk-Laniewski@enron.com;
Ed.Wood@enron.com; mwood@stoel.com; Steve.Wright@enron.com;
Teresa.L.Wright@enron.com; WSCC@enron.com; Charles.Yeung@enron.com;
Christian.Yoder@enron.com; Steven.J.Kean@enron.com;
Steve.Kean@enron.com; Travel.in.the.Park@enron.com;
D.Brett.Hunsucker@enron.com; Carla.Hoffman@enron.com;
Bernadette.Hawkins@enron.com; Joe.Hartsoe@enron.com;
Donna.Fulton@enron.com; Roger.Fragua@enron.com;
James.B.Fallon@enron.com; Michael.Etringer@enron.com;
Terry.W.Donovan@enron.com; Stacy.Dickson@enron.com;
Ginger.Dernehl@enron.com; Rhonda.L.Denton@enron.com;
Jeff.Dasovich@enron.com; Sean.Crandall@enron.com; Tom.Briggs@enron.com;
t.briggs@enron.com; Stacey.Bolton@enron.com; dbenevid@enron.com;
dbenevid@enron.com; Tim.Belden@enron.com; Robert.Badeer@enron.com;
Phillip.K.Allen@enron.com; Alan.Comnes@enron.com; Lysa.Akin@enron.com;
Portland.West.Desk@enron.com; assad@elektro.com.br;
Alan.Comnes@enron.com; Alberto.Levy@enron.com; Aleck.Dadson@enron.com;
Allison.Navin@enron.com; Amy.Fabian@enron.com;
Barbara.A.Hueter@enron.com; Bernadette.Hawkins@enron.com;
Bill.Moore@enron.com; cristinah@elektro.com.br;
Carlos.Gustavo.Azevedo@enron.com; Carmen.Perez@enron.com;
Carolyn.Cooney@enron.com; Charles.Yeung@enron.com;
Chauncey.Hood@enron.com; Chris.Long@enron.com;
Christi.L.Nicolay@enron.com; Cynthia.Sandherr@enron.com;
Damon.Harvey@enron.com; Dan.Staines@enron.com;
Daniel.Allegretti@enron.com; Dave.Mangskau@enron.com;
Donald.Lassere@enron.com; Donna.Fulton@enron.com; Eidy.Catala@enron.com;
Elizabeth.Linnell@enron.com; Frank.Rishe@enron.com;
Geriann.Warner@enron.com; Ginger.Dernehl@enron.com;
Gisele.S.Braz@enron.com; Gloria.Ogenyi@enron.com;
Guillermo.Canovas@enron.com; Harry.Kingerski@enron.com;
Howard.Fromer@enron.com; James.D.Steffes@enron.com;
Janine.Migden@enron.com; Javier.Pantoja@enron.com;
Jean.R.Dressler@enron.com; Jean.Ryall@enron.com; Jeff.Brown@enron.com;
Jeff.Dasovich@enron.com; Jeffrey.Keeler@enron.com;
Joao.Paixao@enron.com; Joe.Allen@enron.com; Joe.Connor@enron.com;
Joe.Hartsoe@enron.com; Joe.Hillings@enron.com; Jose.Bestard@enron.com;
Joseph.Alamo@enron.com; Kathleen.Sullivan@enron.com;
Kerry.Stroup@enron.com; Kikumi.Kishigami@enron.com;
Kirsten.Bellas@enron.com; Lara.Leibman@enron.com;
Laurie.Knight@enron.com; Leslie.Lawner@enron.com;
Linda.J.Noske@enron.com; Linda.Robertson@enron.com;
Lindsay.Meade@enron.com; Lisa.Yoho@enron.com; Lora.Sullivan@enron.com;
Luiz.Maurer@enron.com; Lysa.Akin@enron.com; Marchris.Robinson@enron.com;
Marcia.A.Linton@enron.com; Marcie.Milner@enron.com; Mary.Hain@enron.com;
Maureen.McVicker@enron.com; Melinda.Pharms@enron.com;
Michelle.Belzak@enron.com; Mona.L.Petrochko@enron.com;
Nancy.Hetrick@enron.com; Patrick.Keene@enron.com; Ray.Alvarez@enron.com;
Rebecca.W.Cantrell@enron.com; Ricardo.Charvel@enron.com;
Richard.Ingersoll@enron.com; Richard.Shapiro@enron.com;
Robert.Frank@enron.com; Robert.Hemstock@enron.com;
Robert.Neustaedter@enron.com; Robin.Kittel@enron.com;
Ron.McNamara@enron.com; rboston@enron.com; Rubena.Buerger@enron.com;
Sandra.McCubbin@enron.com; Sarah.Novosel@enron.com;
Scott.Bolton@enron.com; Sergio.Assad@enron.com; Stella.Chan@enron.com;
Stephen.D.Burns@enron.com; Steve.Montovano@enron.com;
Steve.Walton@enron.com; Steven.J.Kean@enron.com; Sue.Nord@enron.com;
Susan.J.Mara@enron.com; Susan.M.Landwehr@enron.com;
Terri.Miller@enron.com; Thane.Twiggs@enron.com; Tom.Briggs@enron.com;
Tom.Chapman@enron.com; Tom.Delaney@enron.com; Tom.Hoatson@enron.com;
Tracy.Cooper@enron.com; Valeria.Lima@enron.com; Vinio.Floris@enron.com;
Xi.Xi@enron.com; Steven.J.Kean@enron.com; Jeffrey.Keeler@enron.com;
Christi.L.Nicolay@enron.com; Sarah.Novosel@enron.com;
Robert.Frank@enron.com; Lara.Leibman@enron.com; Gloria.Ogenyi@enron.com;
Richard.Shapiro@enron.com; Leslie.Lawner@enron.com;
Paul.Kaufman@enron.com; Aleck.Dadson@enron.com;
Daniel.Allegretti@enron.com; Howard.Fromer@enron.com;
Joe.Hartsoe@enron.com; rboston@enron.com; Janine.Migden@enron.com;
Christie.Patrick@enron.com; Jane.Wilson@enron.com;
Rhonda.L.Denton@enron.com; kmagruder@newpower.com; scovino@newpower.com;
Rebecca.Carter@enron.com; Shelley.Corman@enron.com;
Janet.Butler@enron.com; Kevin.M.Presto@enron.com;
Brad.Richter@enron.com; Greg.Piper@enron.com; Kevin.McGowan@enron.com;
Kim.Ward@enron.com; Leslie.Reeves@enron.com
Subject: I'm Leaving Enron

I am going to be the Senior Regulatory Counsel at ISO New England starting
on April 9, 2001.   My last day in the Portland area will be March 31,
2001.  I enjoyed working with you and wish you the best of everything.  My
new address will be:

Mary Hain
Senior Regulatory Counsel
ISO New England Inc.
One Sullivan Road
Holyoke, MA  01040-2841
(413) 535-4000
mhain@ISO-NE.com


The presentations from the San Antonio Leadership Conference are now
accessible from the Business Risk Management intranet page.  Just click on
"Conference San Antonio."   Please pass this information on to accounting
personnel who were not at the conference as well.

Attached is the mentoring questionnaire for you to volunteer to be a mentor
in our new mentoring program.  You can complete it electronically and email
it to me or you can print it and send it to EB 1923.  Thanks for being a part
of this new program.

Jan


My wife obviously has to much time.  This is her vote for the team name.

-----Original Message-----
From: Mjgm4@aol.com [mailto:Mjgm4@aol.com]
Sent: Wednesday, February 06, 2002 1:57 PM
To: gibsonm@mrcorp.com
Subject: open,QUICK!

isn't he darlin'?

 - lugnut dude.ppt


I attach a draft dated 5/10/01 of a Two Way Cash and Letter of Credit Form of
Credit Support Annex to be used with EEI Masters.  Because the Draft Annex is
based on the form  used by the Swap Group, I have also attached a version
marked to show changes from the Swap Group's form.

While preparing this I also reviewed the Credit Annex draft prepared by
Morgan Stanley and Shari Stack's comments on it.  Unlike the MS draft, mine
doesn't contemplate any kinds of collateral other than cash and letters of
credit (which is what EAS wanted, I believe.)  In addition, Shari had posed
the question of whether any defaults under the Credit Annex itself should be
made Events of Default under the Master Agreement.  Although my initial
reaction is that we should not add any such additional defaults under the
Credit Annex as Events of Default, please think about this question as you
review the draft.

I look forward to your comments.
Janet


Please create the executables.

Thanks,
James

Gerald Nemec@ECT
08/01/2000 09:25 AM
To: James Centilli/ET&S/Enron@ENRON
cc: Mark Courtney

Subject: TW Letter

Attached is the letter.  I am forwarding per Mark's request.  Let me know if
you have any comments.  If everything looks good, let me know and I will
create executables.  Thanks.


Thanks for the heads up.  Let me know when you need help...

	Sara Shackleton
	11/28/2000 04:34 PM

		 To: Tana Jones/HOU/ECT@ECT
		 cc:
		 Subject: Re: metals trading

FYI
----- Forwarded by Sara Shackleton/HOU/ECT on 11/28/2000 04:33 PM -----

	Diana Higgins
	11/28/2000 08:06 AM

		 To: Sara Shackleton/HOU/ECT@ECT
		 cc: Hamish M Scutt/EU/Enron@Enron
		 Subject: Re: metals trading

Hi Sara,

The Enron entity is
Enron Metals Limited

(which formerly was Metallgesellschaft Limited)

I can evaluate the credit, and also Anna Shaw, Hamish Scutt or Lindsay
Edmonds, so if you send a request would appreciate if you copy all of us.

Thanks a lot

Diana

From: Sara Shackleton on 27/11/2000 18:31 CST
To: Diana Higgins/LON/ECT@ECT
cc: Mark Taylor/HOU/ECT@ECT

Subject: metals trading

Diana:

I negotiated the Enron North America Corp.  ISDA Master Agreement with the
"President and Fellows of Harvard University" (together with John Suttle).
Harvard is interested in metals trading.  What is the entity trading metals
(financial)?  Will you evaluate the credit?

Please let me know.  Thanks.  Sara


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NOTE NEW LOCATION 30C1

1. Weather Update

2. Willis Phillip Pricing Model for the Northeast (2:30 to 3:00)

3. Technical Analysis Update

4. Mitch Robinson Power 101 (3:00 to 4:30)

Following Week:

June 26th - Technical Analysis 101


Attached is a list of Notaries in ENA Legal.

Janette Elbertson
Enron North America Corp.
Legal Department - EB3326
Telephone:  (713) 853-7906
Fax:  (713) 646-2600
janette.elbertson@enron.com


Start Date: 4/18/01; HourAhead hour: 12;  No ancillary schedules awarded.  No
variances detected.

    LOG MESSAGES:

PARSING FILE -->> O:\Portland\WestDesk\California Scheduling\ISO Final
Schedules\2001041812.txt


Dutch:

Look at this and see if it is a newsletter that you think any of yall would be interested in receiving.

-Ina

-----Original Message-----
From: Bridgeton Global Research [mailto:research@bridgetonglobal.com]
Sent: Tuesday, November 06, 2001 7:09 AM
To: Rangel, Ina
Subject: November 6 Natural Gas Research

Attached is the November 6, 2001 natural gas summary from Bridgeton Global
Investor Services' research department.


great time.  thanks a million.  sorry i had to do homework for some of it.
what would you like me to cook/bring for friday?  i make a mean oyster
stuffing.  and my homemade cranberry sauce is ok, too.  just let me know.

	Nancy Sellers <Nancy.Sellers@RobertMondavi.com>
	11/20/2000 11:57 AM

		 To: Cameron <cameron@perfect.com>, Jeff Dasovich <Jeff_Dasovich@enron.com>,
"Prentice @ Berkeley" <PSellers@haas.berkeley.edu>, Prentice Sellers
<PSellers@pacbell.net>, Scott Laughlin <scottwl@hotmail.com>
		 cc:
		 Subject: Many many thanks

for such a fun birthday dinner and such extravagant presents!  My word - you
guys sure went all out.  Best of course was having you all there.  I love
you!!

Nancy
(707) 251-4870 (phone)
(707) 265-5446 (fax)
"Plus je bois, mieux je chante"


Cara,

	Not a prob, the application wont look at the prod summary file unless you log in against PWRPRODN, so if you are logging against the test db's yer safe.. and for the summary to work it does require at least one previous summary detail in that excel file to work.. it uses that excel's defined macros and such to calculate the totals.. so doing a complete purge wouldnt do good.. do let me know if you have any questions about this.. be more than happy to help.
regards
Asem
x31700

 -----Original Message-----
From: 	Semperger, Cara
Sent:	Monday, August 13, 2001 03:24 PM
To:	Atta, Asem
Subject:	RE: Further Testing of PSW

Hi Asem;

O:\Portland\WestDesk\SCHEDULING\PhysicalAndBookoutSummary_v2_54_WESTPROD.xls
This is the right address.  I am reluctant to add data to the production model, as it will mess up my reports.  I might rename a test file with a strange date, and then purge it.

That should work, eh?

Thanks,

C
 -----Original Message-----
From: 	Atta, Asem
Sent:	Monday, August 13, 2001 1:20 PM
To:	Semperger, Cara
Cc:	Venkataswami, Vishwanatha; Smith, Will
Subject:	RE: Further Testing of PSW

Cara,

	Reason for the error is that the file it was looking for was titled PhysicalAndBookoutSummary_v2_54_WESTTestP.xls . Ive gone ahead and made changes to the application to read the file named as such. Since we're talking about locations of these summary files.. is the production report located at O:\Portland\WestDesk\SCHEDULING\PhysicalAndBookoutSummary_v2_54_WESTPROD.xls ? unfortunately i dont have access to the directories to find out for myself.

thanks
Asem
x31700
 -----Original Message-----
From: 	Venkataswami, Vishwanatha
Sent:	Monday, August 13, 2001 03:09 PM
To:	Atta, Asem
Subject:	FW: Further Testing of PSW

 -----Original Message-----
From: 	Semperger, Cara
Sent:	Monday, August 13, 2001 03:08 PM
To:	Bentley, Corry; Poston, David; Smith, Will; Venkataswami, Vishwanatha
Subject:	Further Testing of PSW

Good Afternoon,

I tried to run the Physical and Bookout summary, and got this error

"Unable to locate M:\Electric\Schedule\Process\WEST\Stage\PhysicalAndBookoutSummary_v2_54_WESTTest.xls"

c


Amy,  I revised a few things in the agreement.  Should be ready to go.


We've swapped voice mails.  I suspect I'll hear from him this am.

Kay

Dale Rasmussen@ECT
10/30/2000 10:01 PM
To: Kay Mann/Corp/Enron@Enron
cc: Stuart Zisman/HOU/ECT@ECT

Subject: LM 6000 summary

Kay:  Did Kent Shoemaker ever get back to you on when/how we should contact
him about the LM 6000 contract summary for LV Cogen?


I am, in fact, at the office as we speak. I am NOT in?Yet.

-----Original Message-----
From: Fenner, Chet [mailto:Chet_Fenner@bmc.com]
Sent: Friday, March 29, 2002 10:12 AM
To: 'chad knipe'; Fenner, Chet; Brad Corrier; Joe Parks; EriK Wollam; Brian Constantine; Brian & Terry Constantine
Subject: RE: G.F.

Yes.  Save the welcome back for Sunday.  Today is when HE split (right, Father?).
-----Original Message-----
From: chad knipe [mailto:knipe3@msn.com]
Sent: Friday, March 29, 2002 7:54 AM
To: Chet Fenner; Brad Corrier; Joe Parks; EriK Wollam; Brian Constantine; Brian & Terry Constantine
Subject: G.F.
Any of you swines fortunate enough to work today?  I have some minor boning to do later but will get IN eventually.  Hope ya'll have a so-so, OK, decent, better than average, or just plain Good Friday.
Welcome back jesus.

C.


Alan --

Not sure if the West Desk is interested in Demand Bidding issues with the
ISO, but wanted you to loop around with the commercial people to see if there
are any specific problems with the current ISO programs.

Please communicate any issues with Harry Kingerski.

Jim

----- Forwarded by James D Steffes/NA/Enron on 03/26/2001 08:33 AM -----

	Harry Kingerski
	03/23/2001 04:00 PM

		 To: Neil Bresnan/HOU/EES@EES, Jay Ferry/HOU/EES@EES, Fred L
Kelly/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt, Jubran Whalan/HOU/EES@EES, Dennis
Benevides/HOU/EES@EES
		 cc: Leslie Lawner/NA/Enron@Enron, Alan Comnes/PDX/ECT@ECT, Jeff
Dasovich/NA/Enron@Enron, James D Steffes/NA/Enron@Enron
		 Subject: FW: Demand Bidding Legislation   (what used to be AB31X- Wright)

We are working to get demand bidding into CA legislation (AB31X).  The ISO
wants from us our laundry list of issues of why their existing programs are
inadequate.  This is a great opportunity to influence them.

Neil and Jubran, could you give us your specific issues and suggestions?  Jay
and Fred, any suggestions would be great from you also.

We will set up a call for Monday at 4 pm CST to discuss and will get phone
number out to you.  Thanks.
----- Forwarded by Harry Kingerski/NA/Enron on 03/23/2001 03:50 PM -----

	MDay <MDay@GMSSR.com>
	03/23/2001 03:37 PM

		 To: "'Harry Kingerski'" <hkingers@enron.com>, "'Jim Steffes, Enron'"
<jsteffe@enron.com>, "'Leslie Lawner, Enron'" <llawner@enron.com>, "'Sandi
McCubbin Enron SF'" <smccubbi@enron.com>
		 cc: "'Jeff Dasovich Enron SF'" <jdasovic@enron.com>, "'Scott Govenar, Enron
lobbyist'" <sgovenar@govadv.com>, "'Sue Mara at Enron SF'" <smara@enron.com>,
"'Bev Hansen, Enron lobbyist'" <bhansen@lhom.com>, "'Hedy Govenar, Enron
Sacto lobbyist'" <hgovenar@govadv.com>
		 Subject: FW: Demand Bidding Legislation   (what used to be AB31X- Wright)

Here is a note from Mike Florio of the ISO Board.  This is encouraging, he
wants to talk further about how the ISO programs can be changed to
accomplish what we want.  What would be most helpful is an item by item
analysis by EES (read: Harry and his people) as to why the existing or
proposed ISO programs are inadequate (or why we need to have 31X amended to
have the ISO do programs for direct access customers parallel to the utility
programs in 31X.)  I need this information soon in order to keep the
dialogue going with Florio.  Thanks for your help.  Mike Day

-----Original Message-----
From: Mike Florio [mailto:mflorio@turn.org]
Sent: Wednesday, March 21, 2001 7:51 PM
To: MDay
Subject: Re: Demand Bidding Legislation (what used to be AB31X- Wright)

Just to show how up to speed I am, I thought that the ISO was already
planning to do this.  Their presentation on demand programs at the last
board meeting showed a scheduling coordinator option and a UDC option, with
different billing and settlement provisions for each.  But it's hard for me
to judge what is adequate (and user-friendly) and what is not absent some
expert help.  I'm definitely interested in the concept and have no great
faith in utility management of programs of this nature.  Let's pursue.
MIKE

P.S.  In his own inimitable way, Dan Richard "offered" me the ORA job way
back when.  I said: "Gee, Dan, I thought we were friends!"   When he acted
all surprised and hurt in that way of his, I reminded him that Marty Lyons
and Mark Loy come with the turf.  End of discussion.

At 05:05 PM 3/21/2001 -0800, you wrote:
>Mike:
>
>I wanted your reaction to a proposal we were making in response to the
>Wright 31X bill on demand bidding programs.  We strongly support these
>programs, and feel that ESPs can bring a lot of benefit to the program by
>aggregaring customers, educating them on the benefits of bidding
"Negawatts"
>and helping to meter and verify their load reductions.  We are certain that
>we could help enroll more customers in the program than if the utilities
>alone were in charge.  So, we proposed language for 31X which allowed ESPs
>to aggregate customers in the utility day ahead and hour ahead programs,
and
>proposed an additional day ahead program based on economic value, (not
>reliability criteria, like reserve margins).
>
>The utilities and the large customers wanted to clarify that we would not
>include direct access customers in the utility programs, because of the odd
>funding source (reductions from the amounts paid to DWR).  We agreed with
>the concept, we don't want to fund demand reduction programs for Direct
>Access customers through DWR payments, but we also feel strongly that there
>should be similar non-discriminatory demand reduction programs for all
types
>of customers, including DA.  So we came up with the idea of inserting
>language in the bill to require the ISO to institute demand bidding
programs
>which match the ones mandated in the bill for the IOUs.  I gave our
>suggestion to Robin Larson, and I don't imagine you've seen it yet, but
>would you give me your reaction to the basic concept?   I looked at the ISO
>website and tried to evaluate the demand bidding programs already in
>place--with a limited amount of understanding, but Enron's business folks
>indicated that they did not consider the existing programs to be the
>equivalent of what the utilities will be implementing.  If that is so, how
>about putting similar programs in place so we can actively market and
>encourage all customers to bid their negawatts (especially the economic,
bid
>and contract in advance deals) so that the ISO can count on the demand
>reductions in advance of a day's operations?
>
>I await your response.
>
>I am so sorry you are not the next ORA director, I was certain you would be
>appointed to that, too. (gallows humor)
>
>Mike Day


The attached list of Action Items will be reviewed for progress within the next couple of weeks.  Please keep in mind, this memo should be kept confidential.

Thank you,

Lisa A. Costello
Assistant to Robert Jones
Enron Networks HR
713/853-1819
lisa.costello@enron.com