The Orange County Register ISO: Duke was just following orders ?The power
producer says the ????
???????agency's disclosure that it ordered units ramped up and down
discredits whistleblowers. July
???????2, 2001 By KATE BERRY

San Diego Union Tribune Duke Energy lashes back at charge of price rigging By
Bill Ainsworth
???STAFF WRITER ?July 2, 2001

Los Angeles Times, July 2, 2001 Monday, Home Edition, Page 1, 1338 words,
????THE NATION; ; Rule May Spur Firms to Waste Energy, JOSEPH MENN, TIMES
STAFF
????WRITER, PALO ALTO

Los Angeles Times, July 2, 2001 Monday, Home Edition, Page 1, 1708 words,
????NEWS ANALYSIS; For Unit of Edison, a Rough Road Ahead; Power: Mission
????Energy's ability to grow is being hampered by its parent's efforts to stay
????out of Bankruptcy Court., JERRY HIRSCH, TIMES STAFF WRITER

Los Angeles Times, July 2, 2001 Monday, Home Edition, Page 7, 297 words,
????The State; ; Californians Cut Energy Use 12.3% From Last Year, TWILA
DECKER,
????TIMES STAFF WRITER

Los Angeles Times, July 2, 2001 Monday, Home Edition, Page 7, 746 words,
????The State; ; Beating Up a Powerful Friend and Creating a Good Impression,
????GEORGE SKELTON, SACRAMENTO

The San Francisco Chronicle, JULY 2, 2001, MONDAY,, FINAL EDITION, NEWS;,
????Pg. A1, 1080 words, Usage down -- Davis' team gloats; ???Energy advisers
????call campaign big success, Jim Doyle

The San Francisco Chronicle, JULY 2, 2001, MONDAY,, FINAL EDITION, NEWS;,
????Pg. A1, 1394 words, Why suppliers get away with huge profits;
????Manipulation of power market appears to be legal, experts say, Carolyn
Said

AP Online, July 1, 2001; Sunday, Domestic, non-Washington, general news
????item, 411 words, Power Grid Operator Details Swings, LOS ANGELES

The Associated Press State & Local Wire, July 1, 2001, Sunday, BC cycle,
????Business News, 637 words, Reports say Calif. power grid operator behind
Duke
????plant's output swings, LOS ANGELES

The Associated Press State & Local Wire, July 1, 2001, Sunday, BC cycle,
????State and Regional, 614 words, Report: State grid operator behind plant's
????output swings, LOS ANGELES

The Associated Press State & Local Wire, July 1, 2001, Sunday, BC cycle,
????State and Regional, 506 words, State: Californians cut power use 12
percent
????last month, By LESLIE GORNSTEIN, AP Business Writer, LOS ANGELES

ISO: Duke was just following orders

The power producer says the agency's disclosure that it ordered units ramped
up and down discredits whistleblowers.

July 2, 2001

By KATE BERRY
The Orange County Register

The California Independent System Operator, the agency that runs California's
electric grid, said Sunday that Duke Energy was following its orders to ramp
generating units up and down during a three-day period in January when the
company was accused by three whistleblowers of price- manipulation.

Duke Energy said the disclosure Friday that the ISO was responsible for
"ramping up" and "ramping down" its generating units would discredit the
accusations of the three former plant employees.

The whistleblowers were lauded last month by Gov. Gray Davis as "heroes."
They testified June 22 before a Senate committee that Duke controlled its
power supplies to drive up prices.

Duke is the subject of several federal and state investigations, including a
grand jury inquiry, into whether generators operated to drive up prices in
California's unregulated wholesale electricity market.

Steve Maviglio, a spokesman for Davis, could not explain why the governor or
the Senate committee were unaware that the ISO was responsible for having the
generating units ramp up and down.

On Friday, the ISO released a memo to the state's Electricity Oversight Board
stating that Duke's "peaking" unit in Chula Vista was "in accordance" with
ISO regulations. The memo said Duke followed the agency's orders to increase
and decrease production 38 times during a three-day period in mid-January.

Duke spokesman Tom Williams said the ISO memo refutes the testimony of the
whistleblowers.

"These former employees had an incomplete picture of what was going on," he
said. "They made assumptions."

Stephanie McCorkle, an ISO spokeswoman, said her agency did not rebut the
testimony of the former employees because the ISO was not asked to testify,
nor was it involved in the Senate committee hearings.

She said the ISO routinely tells generating units - especially peaker plants
-- to ramp up and ramp down at a moment's notice to control the ebb and flow
of electricity through the grid.

The plant's production was an automated dispatch system that allowed the ISO,
not Duke, to control the output. The ramping up and down of units can be done
for several reasons, including price, fluctuating demand, operating reserves
and congestion, she said.

The ISO is still investigating Duke's bidding pattern during the period from
Jan. 17 to Feb. 14, when Duke routinely charged prices as high as $3,880 a
megawatt-hour. Neither the ISO nor Duke has released pricing information from
their plants.

The Federal Energy Regulatory Commission ordered Duke to refund $20 million
for the prices it charged in January and February, even though the company
has not been paid for the power purchases.

"It's not a secret that we had high prices in this period because of credit
reasons," Williams said. "The price issue has been fully fleshed out. People
need to not lose sight of the fact that we haven't been paid."

Peter Navarro, an economics professor at the University of California,
Irvine, said the Duke whistleblowers also testified about the broader issue
of power plants being kept offline for routine maintenance - a central reason
in why California faced threats of rolling blackouts in the winter.

"It would be a shame if Duke came out looking like a wronged white knight
just because of the governor's overexuberance in targeting power suppliers,"
said Navarro, who has been highly critical of Davis' handling of the
electricity crisis.

Duke Energy lashes back at charge of price rigging

By Bill Ainsworth
STAFF WRITER

July 2, 2001

SACRAMENTO -- Duke Energy, which has been stung by allegations of price
gouging at its Chula Vista plant, has begun fighting back by selectively
releasing documents it says exonerate the company of trying to drive up
prices by withholding electricity during a critical power shortage in January.

Duke has released a memo from the state electricity grid manager saying the
company was following state orders when it powered the plant up and down
during three days in January.

But the company has refused to release price information that a spokeswoman
from the Independent System Operator, the grid manager, said was critical to
fully understanding whether the company engaged in price gouging.

The dispute is part of a larger battle between Gov. Gray Davis and the power
generating companies that have made enormous profits from the California
energy crisis.

Last month, in a dramatic public hearing before a state Senate committee,
three former workers at the Chula Vista plant accused Duke of turning
electricity production up and down to manipulate prices, throwing away spare
parts and prolonging plant outages.

Duke, which is based in North Carolina, leases the plant from the San Diego
Unified Port District.

Duke officials called the allegations "baseless," saying plant workers
weren't in a position to know why the plant was powered up and down. Duke
spokesman Tom Williams acknowledged that the company never explained its
actions to employees, saying it was none of their business.

Duke said the plant was following orders from the ISO when it powered down on
Jan. 16 during a Stage 3 alert, when electricity supplies were so low that
rolling blackouts were threatened.

Yesterday, the company released a memo from the grid manager confirming that
from Jan. 16 through Jan. 18, the company followed ISO direction. "The units
did follow the ISO dispatch orders," the memo said.

But Duke refused to disclose how much it charged the state for electricity on
those days, saying the information was confidential.

The ISO, in a March report, accused Duke and other generating companies of
manipulating the market by withholding power and by bidding prices higher
than the state can afford.

Stephanie McCorkle, spokeswoman for the ISO, said the pricing information is
needed to get a complete picture of Duke's actions in January. She said the
grid manager may have ordered the South Bay plant to power down because Duke
was charging prices so high the state could not afford them.

"The ISO frequently orders plants to ramp down because the plant owner is
charging high prices. Output will certainly fluctuate if the price is so
astronomical we can't afford it," she said.

The ISO has the pricing information but is not allowed to release it without
authorization from the power company.

Duke spokesman Williams yesterday said the ISO memo shows that Duke reduced
plant output to keep the electricity grid in balance -- that is, to make sure
that supply was equal to demand.

He said Duke charged high prices during those three days in January,
including the record price of $3,880 per megawatt-hour, because it feared it
would not be paid.

"It's not a secret at this time that we had some high credit prices," he said.

Michael Aguirre, a lawyer who is suing Duke and who helped get the ex-workers
to testify to the Senate committee, chastised the company for not fully
disclosing the prices.

"They should have the courage that these workers had to come forward with all
the information," he said. "They should make a full disclosure."

The memo from the ISO does not address broader charges by the former
employees that the company had been powering its plant up and down for the
entire year to drive up the price of electricity.

Glenn Johnson, a former mechanic at the South Bay plant, has said working
turbines frequently were taken offline for "economic reasons." He and other
plant workers say that meant the company was trying to drive prices higher.

Williams yesterday said "economic reasons" meant the cost of running the
extra turbines was so high the company could not recover the operating costs.

"It's not to drive prices up, it's because you can't produce the power and
make money," he said.

Aguirre said he was skeptical that Duke could not make money operating close
to capacity at a time when wholesale electricity prices were skyrocketing.

Lt. Gov. Cruz Bustamante yesterday accused the company of trying to explain
away its price gouging. "Duke should stop trying to manipulate the media the
way it has California's energy market," he said.

On Friday, Duke asked the ISO to release its memo to just two news
organizations, the Los Angeles Times? and the Charlotte Observer? in North
Carolina. But McCorkle refused, saying a document should be available to
everybody or to nobody.

The newspapers nevertheless obtained the document. Williams said the company
selected those two news organizations because it had been working with them
for weeks on the story. He said Duke plans to release the memo to the public
at a news conference today.

Davis wants nearly $9 billion in refunds from Duke and other companies that,
under the state's flawed deregulated electricity system, acquired power
plants from public utilities and raised wholesale rates dramatically.

Duke Energy, which has been accused by state and federal regulators of
overcharging California customers for its power, set a California record when
it sought $3,880 per megawatt-hour in January.

By comparison, during the first half of 2000, power sold for about $30 a
megawatt-hour.

Los Angeles Times
July 2, 2001 Monday ?Home Edition

SECTION: Part A; Part 1; Page 1; National Desk

LENGTH: 1338 words

HEADLINE: THE NATION;

Rule May Spur Firms to Waste Energy

BYLINE: JOSEPH MENN, TIMES STAFF WRITER

DATELINE: PALO ALTO

BODY:

??The fluorescent lights are burning bright on the top floor of a
Hewlett-Packard Co. office building here, even as sunlight streams in from
skylights and windows, and it pains HP electricity conservation czar Erik
Andres.

??Although the Silicon Valley computer firm has spent more than $1 million on
the latest conservation software and gadgetry and has cut electricity
consumption by 12% from a year ago, Andres won't switch off any more lights.

??If he did, it would make it harder for the company to comply when Pacific
Gas
& Electric orders Hewlett-Packard to cut its power use by as much as 15% in 15
minutes. That's the curtailment promise HP and more than 50 other large
companies around the state recently made to their utilities to win exemptions
from rolling blackouts.

??"We could cut our power 10% right now and not feel it," Andres said,
gesturing upward. "The only reason the lights are on in here is for the
curtailment."

??Andres' dilemma illustrates an unfortunate paradox: California's main
program
for protecting businesses from blackouts is perversely rewarding firms that,
on
most days, conserve the least. Power wasted in the resulting game-playing is
driving up demand and may increase the likelihood of blackouts for
Californians
who aren't exempt, according to utility customers and analysts.

??Since few companies will confess to using more power than they need, it's
impossible to know how much energy is squandered. But few believe
Hewlett-Packard, considered to be among Silicon Valley's better corporate
citizens, is alone.

??"HP isn't the only one who's got smart people," said Richard McCann, a
partner at energy consulting firm M.Cubed in Davis, Calif. "Every program you
have, you're going to have people that figure out how to work the system."

??A lot is at stake in the curtailment program, which was approved in its
current form in May by the California Public Utilities Commission. PG&E, which
has signed up the most customers for the plan, says a 10% power savings from
those companies would amount to 77 megawatts--enough to keep the lights on in
50,000 homes. That kind of savings could have mitigated the effect of the last
rotating blackouts PG&E had to impose. Southern California Edison and smaller
utilities are also participating in the program.

??But if companies can win blackout exemptions later by burning a few more
bulbs now, they will.

??"Anything a business can do to avoid rolling blackouts has a tremendous
appeal," said Joe Desmond, a software executive who works on energy issues for
the Silicon Valley Manufacturing Group.

??Firms Agree to Energy Cuts Under Program

??The prospect of dozens, even hundreds, of hours of outages this summer has
large companies fretting about millions of dollars in lost productivity,
ruined
equipment and other damages. Given that, industry experts say companies in the
curtailment program are only responding logically to the details in the PUC
plan, which carries a title so bureaucratic they find it hard to say with a
straight face: the Optional Binding Mandatory Curtailment Program.

??The program works like this:

??If a company pledges to cut power use from a utility's circuit, the utility
will leave that circuit on when it blacks out other areas. (Smaller businesses
and other users that share a circuit have a much harder time meeting the
requirements, so fewer have applied.)

??Failure to meet the utility's reduction target--whether 5%, 10% or 15%--is
severely punished. The excess use is billed at $6,000 a megawatt-hour,
compared
with recent market prices of about $100 an hour. And repeated misses get
companies barred from the program for five years.

??The trick lies in what usage level the reductions are measured from.

??Under PUC rules, that baseline level is an average of the power consumed
during the 10 most recent days without calls for power curtailment. Weekends
are
excluded, if the call comes during the workweek.

??That means the more power a company uses now, the easier it is to meet the
target when the call comes.

??"It has taken away the incentive for people to do voluntary conservation,"
said Oracle Corp. Energy Director Mukesh Khattar. "There is a dark side that
comes to your mind" and suggests letting the air conditioning rip. Oracle and
most other companies interviewed say they haven't stopped saving electricity.

??But anecdotal evidence shows that "some people are reluctant to conserve, so
that they can keep their average high," said Jennifer Tachera, a staff
attorney
at the California Energy Commission.

??Hewlett-Packard, Oracle and others complain that the curtailment program
gives them little credit for the conservation measures they have already
taken,
such as installing more efficient air conditioners and lights. HP has cut its
electricity use by 12.5% in the six months through April from a year earlier.

??The companies also point out that the 10 most recent days without a
curtailment call are likely to have lower temperatures, and lower
air-conditioning demand, than the first day with a call. That makes the
baseline
artificially low--and makes it even more tempting to conserve less in advance.

??"They're measuring on the 10 days when it's cool, as opposed to the one day
when it's 103 in San Francisco," said consultant Carolyn Kehrein of Energy
Management Services.

??Solutions to Problem Aren't Readily Found

??The big energy users and trade groups have suggested alternatives for
setting
the baseline.

??One scenario would set the baseline at the level used on the same day a year
earlier. But many companies have added or closed facilities since then.

??Another solution, said William Booth of the California Large Energy
Consumers' Assn., would be to allow each customer to negotiate a reasonable
baseline with its electricity supplier.

??"Any blanket approach is going to affect different companies in different
ways," Booth said. But the utilities say they don't have the staff for that.

??A third proposal would set the baseline at the level of consumption when the
call comes in. But opponents are worried that as daily demand projections get
more sophisticated, companies could manipulate that baseline as well.

??"We understand that the reluctance to go there is mainly based on the fear
of
'gaming,' where a customer will jack up their usage just before they believe
they will be called," said Dorothy Rothrock, vice president of the California
Manufacturers and Technology Assn. She said monitoring could catch that type
of
maneuver.

??And a fourth idea, supported by Hewlett-Packard and other industrial users,
would adjust the baseline for temperature changes.

??"It would be a lot better than what we have now," said Bill Smith of the
Electric Power Research Institute, a utility think tank, who for a year has
been
advocating the use of such a formula.

??Jonathan Lakritz, an energy expert at the PUC, said all baselines are
subject
to manipulation and the agency had to pick one quickly before temperatures
started rising.

??"We were doing this under extreme time pressure," Lakritz said. "Certainly
some people are going to find it in their best interest to raise their
baseline."

??In the program as it stands, the PUC and the utilities say they hadn't heard
about companies manipulating the system.

??Then again, Lakritz said, "there weren't very many people that were coming
to
the commission and explaining how they were going to game the system."

??Lakritz said that the PUC is making minor adjustments to the program but
that
more serious changes probably won't be made until the summer is over.

??Lynda Ziegler, Southern California Edison's director of business and
regulatory planning, said she was disappointed to hear of possible abuses.

??"I think that is very unfortunate," Ziegler said. "It's against what
everyone
in California is trying to do, which is make it through this summer."

??*

??MORE INSIDE

??Saving energy: Consumers are doing their part. B7

??Power costs: Edison unit's ability to grow is at risk. C1

LOAD-DATE: July 2, 2001

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??????????????????????Copyright 2001 / Los Angeles Times

??????????????????????????????Los Angeles Times

??????????????????????July 2, 2001 Monday ?Home Edition

SECTION: Business; Part 3; Page 1; Financial Desk

LENGTH: 1708 words

HEADLINE: NEWS ANALYSIS;
For Unit of Edison, a Rough Road Ahead;
Power: Mission Energy's ability to grow is being hampered by its parent's
efforts to stay out of Bankruptcy Court.

BYLINE: JERRY HIRSCH, TIMES STAFF WRITER

BODY:

??For the first time in months, Edison International can see a path through
the
financial and political labyrinth that previously looked to dead-end in
bankruptcy proceedings.

??Yet the survival of the Rosemead-based power company is by no means assured,
as its moves to dodge a date with a federal bankruptcy judge have taken a
tremendous toll.

??In particular, a desperate effort to save itself last week may have dealt a
debilitating blow to Edison's best remaining business, a subsidiary that
builds
and operates power plants around the world.

??That company, Edison Mission Energy, was once considered the crown jewel of
independent power producers.

??But today, the Irvine-based subsidiary is burdened with more than a billion
dollars of debt, used to help its parent company repay loans and avoid
insolvency last week; key managers have fled; and industry analysts and former
company executives say it has little hope for growth and will be at a
financial
disadvantage to its competitors for years to come.

??In the end, Edison's strategy to save itself and its Southern California
Edison utility may prove to be a successful but Pyrrhic victory, producing
enough cash flow to stave off bankruptcy but not nearly the capital needed
for a
healthy future.

??"The path we are on is difficult and fraught with peril," John Bryson,
Edison
International's chief executive, said in an interview Friday. "But it is clear
to us that trying to work this out is vastly preferable to trying to do it
with
lawyers and judges and creditors committees in a bankruptcy court."

??The latter course is the one chosen by PG&E Corp., the San Francisco holding
company that voluntarily plunged its Pacific Gas & Electric utility into
Chapter
11 proceedings in April. PG&E was willing to trade the chance that a federal
bankruptcy judge would strip the utility of important assets to pay creditors
but otherwise leave untouched its other main business, independent power
producer National Energy Group.

??Both utilities became mired in debt, losing billions of dollars buying
electricity when wholesale prices spiked during the last year.

??While Edison executives cope with a legislative stalemate in
Sacramento--where attempts to craft a rescue plan for SCE have stalled--they
can
take heart in several recent developments.

??Major new power plants are coming online, including a Kern County joint
venture of Mission Energy and a division of Texaco Inc. Wholesale energy
prices
have declined, at least for now. SCE has reached repayment agreements with a
group of small generators, the most skittish of its creditors.

??"A number of elements have come together," Bryson said.

??Having survived a near-death experience last week, when Wall Street nearly
balked at Edison's efforts to refinance $1.2 billion in loans and bonds that
started to come due Saturday, Bryson sees an Aug. 15 deadline for a rescue
plan
worked out with Gov. Gray Davis as the next critical milestone for the
company.

??The question now, said Theodore Craver Jr., Edison's chief financial officer
and point man on Wall Street, is how long creditors will wait if they don't
see
a plan coalescing at the state level.

??"This is just not a matter of keeping lightbulbs on," Craver said. "There
are
still billions of dollars of unpaid debt and bills that need to be taken care
of. And the people who are owed that money are anything but relaxed."

??The utility rescue plan worked out between Edison and Davis still lies
stagnant in the California Legislature--its key provision being the state's
purchase of the company's electricity transmission grid for nearly $2.8
billion--and alternative proposals have thus far failed to gather momentum.

??Although the state Senate recently began hearings on the deal at the
governor's request, no votes have been cast, and there is widespread
acknowledgment among lawmakers that the proposal, as written, is functionally
dead.

??Moreover, with the $100-billion state budget and other major matters
demanding the attention of Democrats and Republicans alike, there is little
effort being made in the Capitol to craft a solution before the mid-August
deadline the utility had given state leaders.

??In fact, with lawmakers set to take their annual summer break next month
after the end of partisan budget theatrics, it is almost certain that no SCE
rescue would be approved before fall, if at all.

??Senate President Pro Tem John Burton (D-San Francisco) bluntly stated at a
recent news conference that he feels no pressure to approve a deal with so
many
consequences for the people of California in so little time.

??Assembly Speaker Bob Hertzberg (D-Sherman Oaks), meanwhile, continues to
lead
efforts to craft an alternative plan that would place much of the burden of
financing an SCE rescue on big business. In exchange, companies would be
allowed
to bypass the traditional utilities and contract directly with energy
marketers
for power.

??Although the plan has gathered the most support yet among lawmakers, it also
has met with opposition from business leaders, who contend that they alone
should not shoulder the costs of the energy crisis.

??Bryson is concerned but not panicked over the inaction at the legislative
level.

??"It is a long process trying to understand what has to be done and who needs
to do it," he said.

??Yet he concedes that persuading creditors to remain patient is a difficult
and at times "testy experience"--not to mention something that worries
analysts.

??"You still have the risk that if any creditors get spooked, it is very easy
for just a few of them to get together and file an involuntary-bankruptcy
petition," said Jon Cartwright, a bond analyst at Raymond James & Associates
in
St. Petersburg, Fla.

??Whether or not Edison winds up in U.S. Bankruptcy Court, analysts say the
company's extraordinary efforts to prevent a bankruptcy filing will have a
long-term effect on Mission Energy.

??Independent power producers depend on strong cash flow and borrowing power
to
grow. That's because power plants generally have a limited output. They don't
work like a retail chain, which will see profit soar when sales per store
increase. Independent power producers grow by building new plants and adding
generating capacity.

??"There's no question that if credit costs at Edison Mission Energy are
extremely high, we will be encumbered in our efforts to grow the company,"
Bryson said. Last week's bond sale to refinance Edison International's debt
was
secured by Mission Energy and had a yield of 14%, about double what a healthy
company would pay.

??Analysts are more pessimistic.

??"It's going to be difficult to even get a project," analyst Cartwright said.
"You need a customer before you can do anything, and who is going to sign up
with Mission Energy right now?"

??Specifically, he said, Mission's ability to generate the cash flow required
to start construction of new projects has been placed in doubt.

??The company has grown rapidly in recent years, nearly quadrupling generation
capacity since 1998. As of July 2000, Mission Energy trailed only AES Corp. of
Arlington, Va., internationally, according to Platts, an information company
that tracks the independent power industry.

??Mission Energy's revenue soared 260% to $3.2 billion from 1998 to 2000. But
profit growth has not kept pace. Net income of $125.3 million in 2000 was
nearly
$7 million less than what the company earned in 1998 on a fraction of the
revenue.

??Just as worrisome to the company's ability to grow is the recent flight of
executives.

??As the energy crisis in California grew, nearly a dozen key executives
bolted, including Chief Financial Officer James Iaco, Corporate Secretary
Martha
Spikes and Thomas Legro, a vice president.

??These latest defections add to what has become a nearly complete turnover in
Mission Energy's management since early 2000, including the departures of
Chief
Executive Ed Muller, Senior Vice President S. Linn Williams and Michael
Childers, a vice president of business development who was one of the
company's
chief architects for growth.

??Bryson said it should surprise no one that people are leaving.

??"The skill base remains very good," he said, "but people want to be sure
they
have a future to exercise their skills at building a company."

??Bryson believes that such opportunities remain at Mission Energy. He noted
that the company is working on four or five projects. And there is room, he
said, to boost cash flow and profit through smart management and improving
operating efficiencies at the company's formidable stable of existing power
plants.

??*

??Times staff writer Miguel Bustillo in Sacramento contributed to this report.

??RELATED STORIES

??Power paradox: Businesses pad use to gain in blackouts. A1

??Energy savers: State residents are consuming less power. B7

??Moving Up

??Edison Mission Energy has been producing more power in recent years and
moving up in the ranks of the world's top independent power producers:

??2000

??Rank/company Megawatts of generating capacity 1. AES 33,044 2. Edison
Mission
Energy 22,935 3. International Power 14,933

??1999

??Rank/company Megawatts of generating capacity 1. AES 20,459 2. International
Power 16,362 3. Mirant 12,660 4. Edison Mission Energy 9,383

??1998

??Rank/company Megawatts of generating capacity 1. AES 16,241 2. International
Power 10,562 3. TXU 6,973 4. Edison Mission Energy 6,223 Sources: Platts,
McGraw-Hill

??Rising Revenue, Falling Profit

??Edison Mission Energy's revenue has risen rapidly in recent years, but
profit
growth hasn't kept pace.

??*

??Operating revenue (In billions)

??1998: $0.89 billion

??1999: $1.64 billion

??2000: $3.24 billion

??*

??Net income (In millions)

??1998: $132.1 million

??1999: $130.3 million

??2000: $125.3 million

??Source: Company reports

GRAPHIC: GRAPHIC: Rising Revenue, Falling Profit, Los Angeles Times GRAPHIC:
Moving Up, Los Angeles Times

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??????????????????????????????Los Angeles Times

??????????????????????July 2, 2001 Monday ?Home Edition

SECTION: California; Part 2; Page 7; Metro Desk

LENGTH: 297 words

HEADLINE: The State;
;
Californians Cut Energy Use 12.3% From Last Year

BYLINE: TWILA DECKER, TIMES STAFF WRITER

BODY:

??Blackout-weary Californians are apparently doing what has been asked of
them:
consuming less energy.

??State residents used 12.3% less power in June 2001 compared with June last
year, according to findings released Sunday by the California Energy
Commission.

??The figures also show that during peak times of the day, energy consumption
was cut even further to 14.1%.

??"It's all the little things Californians are doing," said Roger Salazar, a
spokesman for Gov. Gray Davis. "Whether it's changing to fluorescent
lightbulbs,
setting the thermostat at 78 degrees . . . or turning in old appliances. All
of
these things are adding up."

??The conservation efforts coupled with the addition of three new power
plants,
two of which are expected to be online this week, lessens the likelihood of a
summer of rolling blackouts, Salazar said.

??On Wednesday, a 320-megawatt power plant opened near Bakersfield. Today, a
550-megawatt plant is scheduled to open in Sutter County. A third is set to
open
in Contra Costa County on July 9.

??But Salazar cautioned that no one can control Mother Nature.

??"We're not in the prediction business," he said. "If we have a week of hot
days, that could increase demand. All we can do is do the things that are in
our
control."

??In compiling its figures, the commission factored in changes in economic
growth, population increases and temperature variations between June 2000 and
June 2001.

??Without factoring in those differences, there was an actual meter reduction
of 3,834 megawatts.

??Though the figures are a good sign, Davis warned residents not to become
complacent.

??"Every kilowatt saved is money we keep in California and out of the pockets
of out-of-state generators," he said. "For those of you who can, I urge you to
do more."

LOAD-DATE: July 2, 2001

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??????????????????????Copyright 2001 / Los Angeles Times

??????????????????????????????Los Angeles Times

??????????????????????July 2, 2001 Monday ?Home Edition

SECTION: California; Part 2; Page 7; Metro Desk

LENGTH: 746 words

HEADLINE: The State;
;
Beating Up a Powerful Friend and Creating a Good Impression

BYLINE: GEORGE SKELTON

DATELINE: SACRAMENTO

BODY:

??Politicians are too predictable, you say. Well, here's a twist: Republican
conservative beats up on big business.

??Secretary of State Bill Jones, running uphill for governor, lectured the
power industry "to change business practices or face consequences."

??Consequences like being shut out of California's huge electricity
market--12%
of the nation's population, the world's fifth-largest economy.

??Jones scolded:

??"Either you get with the program, or Californians may take matters into
their
own hands. I tell you, if you do not get up and do something to help this
state--and by doing so, help yourselves--then you as energy providers face a
dim
future here . . .

??"Let me remind you of a little process we have out here in California called
the ballot initiative. When people get angry enough, voters can and do take
action directly through the polls."

??You probably have not read or heard about this dressing down by a
pro-business Republican of profiteering power suppliers, some of whom he
asserted "simply got greedy."

??That's because Jones normally does not attract a lot of attention. Too dull
and predictable, we newsies say. And he gave this dinner speech late on a
weeknight, June 21, in out-of-the-way Ojai. The audience was relatively
small--62 people attending a conference of the Western Power Trading Forum.

??"I probably was not as welcome leaving as I was coming in," Jones says. "But
it's the kind of speech those folks needed to hear."

??"He got a mixed reaction," recalls the power group's executive director,
Gary
Ackerman. "We'd like to see stronger support from gubernatorial candidates
because we feel we've done nothing wrong and have played by the rules.

??"But there's some sympathy and understanding that any politician worth his
salt is not going to stand up and go 'rah-rah' for the generators. . . .

??"He's in a lot of good company with people who feel the same way."

??That's verified by a new Times poll. When registered voters were asked
whether they agree or disagree that "independent power companies have
manipulated the electricity market in California in order to make a higher
profit," 89% agreed--77% "strongly."

??Moreover, 90% of voters called energy a serious problem, but only 35%
believed "there is an actual shortage" of electricity.

??The problem, voters think, is gaming and gouging.

??So even if Jones was in strange territory for a Republican politician, he
was
on safe ground with voters.

??Jones' strategy, however, is not merely to pander to voters. His aim is to
be
seen as a straight shooter--an experienced politician who's knowledgeable and
doesn't pull punches.

??That contrasts with his only announced opponent for the GOP gubernatorial
nomination, megabucks businessman Bill Simon, who never before has run for
office. Simon is still doing crash homework on basic issues and is
super-cautious in answering questions about his views.

??Asked last week at the Sacramento Press Club whether he thinks power
producers have gouged consumers, the onetime prosecutor replied, "That really
rests on the investigations. . . . I wouldn't want to prejudge culpability."

??If he had answered the Times poll, Simon would have been among the very
few--6%--who weren't sure.

??Former Mayor Richard Riordan, who's being egged on by President Bush to run
for governor, probably won't be attacking greedy generators either. That's
because he could be branded one himself. The L.A. DWP was one of the biggest
gougers last winter while selling electricity to the state.

??That's priceless fodder for Jones. But in Ojai, he pounded primarily on Gov.
Gray Davis--"he took a problem and made it into a crisis"--and the private
producers.

??Jones admonished the power companies to embrace the Federal Energy
Regulatory
Commission's new wholesale electricity price caps.

??"You are in many ways waging war on yourselves," he said. "The reports of
never-before-heard-of profits of several generators have fueled resentment .
. .
and soured the long-term prospects for true market reforms."

??Ackerman, the dinner host, said Jones arrived as an unknown, but "left
people
with a positive image. . . .

??"I'll add one thing. This man has integrity. I talked to him about
[campaign]
contributions. He didn't hesitate. He said he wouldn't accept money from
generators during the [energy] crisis."

??This is intriguing strategy. Beat up a usual ally. Leave a good impression.
Earn praise for ethics.

??Refreshing politics.

LOAD-DATE: July 2, 2001

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?????????????????Copyright 2001 The Chronicle Publishing Co.

?????????????????????????The San Francisco Chronicle

?????????????????????JULY 2, 2001, MONDAY, FINAL EDITION

SECTION: NEWS; Pg. A1

LENGTH: 1080 words

HEADLINE: Usage down -- Davis' team gloats;

Energy advisers call campaign big success

SOURCE: Chronicle Staff Writer

BYLINE: Jim Doyle

BODY:
Gov. Gray Davis' top energy advisers took credit yesterday for the apparent
success so far of their new conservation campaign, calling it the most
aggressive energy-savings effort in the nation's history.

???California's new conservation programs have sparked the public imagination
to significantly reduce energy use -- 12.3 percent less electricity used last
month alone -- save money and avoid blackouts, state energy officials told
reporters during a conference call.

???"People are choosing by the millions to conserve," said David Freeman, the
governor's senior energy adviser. "It is a demonstration of enormous
implications not only for California but the rest of the country. . . .
Californians are acting in their own self-interest and in a patriotic way."

???He noted that the sales of clotheslines in the state have "gone through the
roof," and that fans are practically sold out.

???Reduced power demand was a key factor in the state's avoidance of rolling
blackouts last month, Freeman said. But, he said, "We're not out of the woods
yet," meaning that the new conservation bandwagon is still unlikely to get the
state through the summer without major rolling blackouts.

???"We'll be keeping our fingers crossed," Freeman said. "We're not making any
predictions. . . . We don't know what the temperature is going to be. We
haven't
had a situation where you have real hot weather throughout the state three or
four days in a row. We don't know how many power plants will break down in
July."

???The biggest indicator that Californians appear to be saving more power than
expected came when the governor's energy advisers released figures for the
state's reduced demand for electricity, indicating that for the second month
in
a row Californians exceeded the governor's request to cut power usage by 10
percent. For June, electricity use was down 12.3 percent from last year; in
May,
the state's power use was down 11 percent.

???The savings last month came even though June was a bit hotter than last
year, and there are 500,000 more residents in California than a year ago.

???"Conservation is really working. It's really phenomenal," Steve Larson,
executive director of the California Energy Commission, said in the call.

???"People have stepped to the plate and knocked the ball out of the park. . .
. The demand is down," he said, praising consumers for, among other things,
setting thermostats at higher temperatures in warm weather to reduce air
conditioning.

???EVERYONE'S SAVING ENERGY

???"In all areas of the state, people are conserving and at a fairly
consistent
rate," he said. "It's all sectors. It's business, residents, everyone who uses
electricity. . . . (But) we don't know if these numbers are going to hold."

???In addition to the overall reduction in use, electricity demand at peak
times during June 2001 declined by 5,570 megawatts -- or 14.1 percent compared
to June 2000. Those savings are equivalent to shutting down half a dozen major
power plants.

???The state experienced 10 days in June 2000 where power demand exceeded
40,000 megawatts -- a threshold level that can result in emergency blackouts.
Last month, however, there were no comparable days of extreme power demand.

???Energy officials also noted that new power plants are going online, adding
that the governor will flip the switch on a new, 500-megawatt unit today near
Yuba City in Sutter County.

???"We have record conservation. We have record (power) generation. And we've
locked in long-term energy at reasonable rates," said Roger Salazar, the
governor's deputy press secretary. "It is having a tremendous impact."

???DOUBTING THOMASES

???Skeptics say the numbers aren't as rosy as they are cracked up to be.

???Some have said California's energy savings are simply the result of
businesses shutting down in the stalled-out economy. Others suggest the state
has twiddled the latest conservation figures -- based on differences in this
year's temperature and population growth -- in search of good ink for the
governor.

???And political polls show that Californians are skeptical about the reasons
for the state's energy crisis.

???But the governor's energy advisers insist that state economic growth has
continued and that businesses and residential customers are making significant
reductions in power use.

???"It's real conservation that is taking place," Freeman said. "The bulk of
the savings are coming from voluntary actions that consumers are taking.
There's
nothing unreal about the money people can save in saving energy. I think there
is a combination of a selfish desire to save money and an unselfish desire to
avoid blackouts for the community as a whole."

???Not surprisingly, state energy officials credit the governor's initiatives
for the latest favorable statistics.

???"None of this is happening accidentally," Freeman said. "(These programs),
in combination, are the most aggressive energy conservation programs ever
enacted in the United States of America."

???10 COMPONENTS

???California's energy conservation programs involve 10 major components,
ranging from special pleas to CEOs and ads directed at residential power users
to consumer rebates and new penalties for the biggest power users:

???-- A paid advertising campaign urges California residents and businesses to
conserve energy to not only help avoid blackouts but also to save money.

???-- Residential users whose power usage is 20 percent lower than last year
are entitled to an additional 20 percent discount off their electricity bills.

???-- $850 million has been set aside for rebates and monetary incentives for
consumers who buy new refrigerators and air conditioners that are the most
energy efficient available.

???-- Industrial users who increase their power usage face stiff penalties in
the form of steep rate hikes.

???"We've reached out to everyone from CEOs to building managers and janitors
to schoolchildren," said Aileen Adams, secretary of the state Department of
Consumer Services. "We feel that all these things taken together have a huge
impact."

???In addition, new energy efficiency standards recently went into effect for
state buildings.

???Wally McGuire, director of the California Conservation Campaign, said 236
organizations have signed declarations of their intent to immediately cut at
least 20 percent of their electrical power use.

???The governor's energy advisers declined to indicate the cost of their
energy
conservation efforts.E-mail Jim Doyle at jdoyle@sfchronicle.com.

GRAPHIC: PHOTO

LOAD-DATE: July 2, 2001

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?????????????????Copyright 2001 The Chronicle Publishing Co.

?????????????????????????The San Francisco Chronicle

?????????????????????JULY 2, 2001, MONDAY, FINAL EDITION

SECTION: NEWS; Pg. A1

LENGTH: 1394 words

HEADLINE: Why suppliers get away with huge profits;

Manipulation of power market appears to be legal, experts say

SOURCE: Chronicle Staff Writer

BYLINE: Carolyn Said

BODY:
Most Californians think power generators have "gamed" the electricity market,
illegally gouging the state to make billions of dollars. But if energy
companies
are so blatantly villainous, why hasn't anyone been able to collar them?

???The answer is simple, said Harry Snyder, who follows electricity
deregulation for the West Coast office of Consumers Union.

???"Gaming is legal under market theory," he said. "It's called maximizing
profits. They didn't need to break the law in order to screw consumers."

???For months, dozens of investigators from the attorney general's office, the
Public Utilities Commission, the California Independent System Operator and a
special state Senate committee have pored over reams of documents, conducted
copious interviews and visited power plants up and down the state.

???All they want is to prove what seems self-evident to most consumers: Energy
firms drove up electricity prices by withholding supply, shutting down plants
and exploiting the bidding process.

???It's not that simple, say most experts. California created the
dysfunctional
trading market; the companies figured out ways to play by its rules and still
make out like bandits.

???"The state of California can make all the allegations about gaming and
manipulation that it wants, but, damn, it set up the system," said Arthur
O'Donnell, editor and associate publisher of California Energy Markets. "It's
resulted in high prices because of imbalance between supply and demand. Stop
whining about it and fix the damn system."

???PROFIT PARADISE

???Deregulation created a kind of happy hunting ground for energy traders.
There was no "demand elasticity" -- no matter how high the price got, grid
operators couldn't just say, "No thanks, we'll buy less power and have a
rolling
blackout today instead." That meant power companies could charge an arm and a
leg, and California would pay it.

???"It is not illegal for a company to jack up its prices or to put less out
on
the market in order to keep a higher price in the market," said Severin
Borenstein, director of the University of California Energy Institute. "Those
are both legal as long as a company does it on its own; it can't collude with
other companies to do it."

???Still, the generators' behavior is so suspicious that California may be
able
to prove antitrust violations, said state Sen. Joseph Dunn, D-Santa Ana,
chairman of the Senate committee investigating alleged price manipulation.

???'MARKET POWER'

???Making an antitrust case breaks down into two parts: Prove the companies
had
"market power," then prove that they exercised it in concert.

???Market power itself is not illegal. Simply put, it means the ability to set
a price without competitive consequences -- without losing business, in other
words.

???For example, Dunn said, if an auto dealer suddenly decides to raise car
prices by $5,000, the logical consequence would be for car buyers to visit
other
dealers. But if a dealer raises prices and does not lose business -- because
other dealers also raise their prices -- market power has been exercised.

???You can see market power at work in everything from milk to plane tickets.
Grocers and airlines shop their competitors to see how much they are charging
and adjust their prices accordingly.

???Most economists and other experts agree that market power exists in
California's wholesale electricity market, primarily among the big five
generators -- Duke Energy, Dynegy, Williams Energy, Reliant and Mirant.

???But, again, the mere existence of market power does not prove wrongdoing.
However, if power generators (or grocers or airlines) did, indeed, hold a
secret
meeting to set prices, that would be collusion, an illegal activity.

???SEARCH FOR EVIDENCE

???"It's very hard to prove collusion cases unless you have a smoking gun --
tapes, a document, a witness who will testify or wear a wire," Borenstein
said.

???Absent a smoking gun, investigators can try to prove indirect collusion or
concerted activity by scrutinizing plant records and examining instances of
power being withheld and prices going up.

???"There is behavior in the California market that you can't explain in any
other way than by concerted activity," Dunn said.

???"If all five (big generators) withhold their full capacity when demand
exists, it suggests the companies are not acting in competition with each
other
but in complement. We can't yet identify any legitimate reasons for
across-the-board withholding," Dunn said.

???"The only thing that results from all this withholding on a given day is
that they drive up the price tomorrow."

???There is ample evidence that withholding has occurred, but no definite
proof
so far that it happened in concert. The Chronicle reported in May that several
power firms ramped their generators up and down to create artificial
shortages,
which jacked up prices. Those shortages caused the blackouts early this year,
which were unprecedented because they occurred in the winter, when electricity
demand is low.

???Three former Duke Energy employees testified before Dunn's committee last
month that the firm raised and lowered plant production, idled units and
destroyed some equipment -- all to drive up prices.

???Duke, which will testify later this month, took out full-page newspaper ads
across the state to rebut the allegations, saying it was merely following
directives from California grid operators.

???Yesterday, the Los Angeles Times reported that, according to its review of
internal documents, grid operators in fact had instructed Duke to vary its
power
output at the plant in question.

???To make a case, investigators still have to link withholding by individual
firms into a mosaic that shows they acted in concert.

???Even if an antitrust case cannot be proved, power companies may still be
liable for civil penalties. The PUC intends to file a case this summer that
would levy such civil charges as violation of contract, unfair business
practices and fraud.

???Gary Cohen, general counsel of the PUC, said: "We have evidence and will be
able to prove that there have been times when the grid was in an alert, an
emergency, and the ISO put out a dispatch order for a particular unit to come
to
full power and they didn't (although) there was no maintenance or other
mechanical reason that would have prevented them.

???"At a minimum, that would be a violation of the ISO tariff, which is like a
contract. That's breach of contract."

???Fraud charges could come if generators gave misleading information about
why
plants were shut down, he said. "They may have thought it looked bad to say
'We're taking a break' and (instead) said they were down for mechanical
reason.
If they said something that's not true, what follows from that is a fraud
case,"
Cohen said.

???Unfair business practices could be charged if power firms intentionally
withheld supply during power emergencies to drive up the price, he said.

???Cohen said he hopes the PUC investigation will also lead to changing the
law, so these practices would be illegal. "If we don't have the right rules,
maybe we need to make some new rules."

??-------------------------------------------------------

??Examining energy pricesThese are among the federal and state investigations
of California's energy crisis: -- Federal Energy Regulatory Commission: has
been
examing the high natural gas prices in California that contributed to the
state's spiraling electricity costs. The agency has also reviewed allegations
that companies overcharged for power in the energy market.

???-- California Senate Committee to Investigate Price Manipulation of the
Wholesale Energy Market: has been looking into charges of price manipulation.

???-- California Attorney General Bill Lockyer: has been pressing ahead with a
review of the practices of wholesale power companies.

???-- California Public Utilities Commission: has undertaken a broad
investigation into the origins of the state's energy problems and whether the
market for power was manipulated.Chronicle Research

??-------------------------------------------------------

??Tell us what you think-- What are your suggestions for saving energy? Send
your best tips to Energy Desk, San Francisco Chronicle, 901 Mission St., San
Francisco, CA 94103; or put your ideas in an energy-efficient e-mail to
energysaver@sfchronicle.com.

??E-mail Carolyn Said at csaid@sfchronicle.com.

LOAD-DATE: July 2, 2001

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???????????????????????Copyright 2001 Associated Press

??????????????????????????????????AP Online

?????????????????????????????July 1, 2001; Sunday

SECTION: Domestic, non-Washington, general news item

LENGTH: 411 words

HEADLINE: ?Power Grid Operator Details Swings

DATELINE: LOS ANGELES

BODY:

???The operator of the state's power grid has acknowledged that it was
responsible for swings in production at a power plant that Gov. Gray Davis
said
were evidence of price gouging by out-of-state energy companies, two
newspapers
reported Sunday.

??The California Independent System Operator told its oversight board that
records showed Duke Energy was following its orders to adjust output in order
to
help balance the grid and not to drive up prices, the Los Angeles Times and
The
Charlotte (N.C.) Observer reported.

??Three former workers at a Duke Energy power plant near San Diego told state
investigators on June 22 that production units were shut down in what they
called a scheme to drive up electricity prices.

??Duke responded last week with full-page ads in newspapers from California to
its home state of North Carolina, saying production was increased and
decreased
at the order of the ISO.

??The company said the three workers ''did not know and were not in an
operational capacity to know that the ISO directs output.''

??The ISO gave its analysis to selected lawmakers late Friday after Duke,
based
in Charlotte, N.C., gave the agency's confidential orders to the Times and the
Observer.

??The ISO analysis found that Duke's South Bay plant had accurate logs showing
that the units followed the ISO's orders.

??''It's regrettable that some people have inferred things that just weren't
the case,'' said Duke spokesman Tom Williams.

??However, the ISO findings may not clear Duke entirely of charges that it
manipulated power supplies during three days in January when prices
skyrocketed,
said Gregg Fishman, an ISO spokesman.

??State officials cautioned that further investigation is still needed to
determine if Duke used other tactics to manipulate the power market.

??Duke is one of several out-of-state generators that entered the California
market after the state deregulated its power industry in 1998. It operates
four
plants and accounts for about 5 percent of the state's generating capacity.

??The Federal Regulatory Commission last month found the company overcharged
California by millions earlier this year when it was charging $3,880 a
megawatt-hour for electricity. The commission found that Duke was entitled to
only $273 per megawatt-hour. In one month, the average home in North and South
Carolina uses one megawatt hour at a cost of $73.

?????(PROFILE

?????(CO:Duke Energy Corp; TS:DUK; IG:ELC;)

?????)

LOAD-DATE: July 1, 2001

?????????????????????????????18 of 149 DOCUMENTS

???????????????????The Associated Press State & Local Wire

The materials in the AP file were compiled by The Associated Press. ?These
materials may not be republished without the express written consent of The
Associated Press.

????????????????????????July 1, 2001, Sunday, BC cycle

SECTION: Business News

LENGTH: 637 words

HEADLINE: Reports say Calif. power grid operator behind Duke plant's output
swings

DATELINE: LOS ANGELES

BODY:

??The operator of California's power grid has acknowledged that it was
responsible for swings in production at a Duke Energy power plant that Gov.
Gray
Davis held as an example of price gouging by out-of-state energy companies.

??The Los Angeles Times and Charlotte Observer reported Sunday that the
California Independent System Operator told its oversight board that records
showed Charlotte, N.C.-based Duke Energy was following orders to help balance
the grid and not driving up prices.

??Three former workers at Duke Energy's San Diego-area plant told state
investigators June 22 that production units were shut down in what they
called a
scheme to drive up electricity prices.

??Duke responded last week by taking out full-page newspaper ads defending
itself against the accusations by the former workers.

??Duke officials said in the ads - which appeared in newspapers in California,
Texas, South Carolina and North Carolina - that plant production was increased
and decreased at the order of Cal-ISO, the agency that controls the state's
power grid and monitors supply and demand.

??The California version of Duke's advertisement specifically denied the
workers' allegations, and claimed they "did not know - and were not in an
operational capacity to know - that the ISO directs output. ..."

??Davis had praised the three workers as heroes and Lt. Gov. Cruz Bustamante
said they had delivered the "smoking gun" needed to prove price gouging.

??Cal-ISO has not yet publicly acknowledged its role in the ramping up and
down
of electricity production, but gave its analysis late Friday to selected
lawmakers. The move came after Duke gave the agency's confidential orders to
the
Times and the Observer.

??The agency's analysis found that Duke's South Bay units had accurate logs
showing that the units followed Cal-ISO's dispatch orders.

??Duke's documents also show the company offered all available power from the
plant to the ISO. Sometimes, the agency bought the right to generating
capacity
but did not - even under threat of imminent blackouts - exercise that right by
asking Duke to produce the power.

??ISO's memo does not address Duke's assertions of how much power it made
available to the ISO or how much power the agency bought and didn't buy.

??"It's regrettable that some people have inferred things that just weren't
the
case," said Duke spokesman Tom Williams.

??Duke, like other generators, has refused to supply prices for power it sold
and offered to sell, citing competitive pressures. Without that information,
accurate conclusions can't be drawn about Duke's business practices, ISO
spokeswoman Stephanie McCorkle said. She said the agency is not ready to
provide
additional information.

??Duke has been challenged for its production tactics and pricing at the state
and national level. The Federal Regulatory Commission last month found the
company had overcharged California by millions earlier this year when it was
charging $3,880 a megawatt-hour for electricity. The commission found that
Duke
was entitled to only $273 per megawatt-hour.

??In one month, the average home in North and South Carolina uses one megawatt
hour at a cost of $73.

??Duke is one of several out-of-state generators that entered the California
market after the state deregulated its power industry in 1998. With three
plants
it owns and the leased South Bay plant, Duke accounts for about 5 percent of
the
state's generating capacity.

??On Thursday, the state Senate committee investigating Duke and others held
two generators in contempt for failing to provide records of their operations
in
California. Duke was not held in contempt because it agreed to turn over
documents by the July 10 deadline, said Ronda Paschal, a spokeswoman for state
Sen. Joe Dunn, D-Santa Ana, a committee leader.

LOAD-DATE: July 2, 2001

?????????????????????????????19 of 149 DOCUMENTS

???????????????????The Associated Press State & Local Wire

The materials in the AP file were compiled by The Associated Press. ?These
materials may not be republished without the express written consent of The
Associated Press.

????????????????????????July 1, 2001, Sunday, BC cycle

SECTION: State and Regional

LENGTH: 614 words

HEADLINE: Report: State grid operator behind plant's output swings

DATELINE: LOS ANGELES

BODY:

??The operator of the state's power grid has acknowledged that it was
responsible for swings in production at a power plant that Gov. Gray Davis
held
as an example of price gouging by out-of-state energy companies.

??The Los Angeles Times and Charlotte Observer reported Sunday that the
California Independent System Operator told its oversight board that records
showed Duke Energy was following orders to help balance the grid and not
driving
up prices.

??Three former workers at Duke Energy's San Diego-area plant told state
investigators June 22 that production units were shut down in what they
called a
scheme to drive up electricity prices.

??Duke responded last week by taking out full-page newspaper ads defending
itself against the accusations by the former workers.

??Duke officials said in the ads - which appeared in newspapers in California,
Texas, South Carolina and North Carolina - that plant production was increased
and decreased at the order of Cal-ISO, the agency that controls the state's
power grid and monitors supply and demand.

??The California version of Duke's advertisement specifically denied the
workers' allegations, and claimed they "did not know - and were not in an
operational capacity to know - that the ISO directs output. ..."

??Governor Davis had praised the three workers as heroes and Lt. Gov. Cruz
Bustamante said they had delivered the "smoking gun" needed to prove price
gouging.

??Cal-ISO has not yet publicly acknowledged its role in the ramping up and
down
of electricity production, but gave its analysis late Friday to selected
lawmakers. The move came after Charlotte, N.C.-based Duke gave the agency's
confidential orders to the Times and the Charlotte Observer newspaper.

??The agency's analysis found that Duke's South Bay units had accurate logs
showing that the units followed Cal-ISO's dispatch orders.

??"It's regrettable that some people have inferred things that just weren't
the
case," said Duke spokesman Tom Williams.

??The agency's findings may not clear Duke entirely of charges that it
manipulated power supplies during three days in January when prices
skyrocketed,
said Gregg Fishman, an ISO spokesman.

??"Those facts are all correct, but they may not add up to a complete picture
of what happened during those three days," Fishman told the Charlotte Observer
on Saturday.

??State officials cautioned that further investigation is still needed to
determine if Duke used other tactics to manipulate the power market.

??"ISO's comments on the ramping still do not resolve the full question," said
state Sen. Joe Dunn, D-Santa Ana.

??Duke has been challenged for its production tactics and pricing at the state
and national level. The Federal Energy Regulatory Commission last month found
the company had overcharged California by millions earlier this year when it
was
charging $3,880 a megawatt-hour for electricity. The commission found that
Duke
was entitled to only $273 per megawatt-hour.

??In one month, the average home in North and South Carolina uses one megawatt
hour at a cost of $73.

??Duke is one of several out-of-state generators that entered the California
market after the state deregulated its power industry in 1998. With three
plants
it owns and the leased South Bay plant, Duke accounts for about 5 percent of
the
state's generating capacity.

??On Thursday, the state Senate committee investigating Duke and others held
two generators in contempt for failing to provide records of their operations
in
California. Duke was not held in contempt because it agreed to turn over
documents by the July 10 deadline, said Ronda Paschal, a spokeswoman for
Dunn, a
leader of the committee.

LOAD-DATE: July 2, 2001

?????????????????????????????20 of 149 DOCUMENTS

???????????????????The Associated Press State & Local Wire

The materials in the AP file were compiled by The Associated Press. ?These
materials may not be republished without the express written consent of The
Associated Press.

????????????????????????July 1, 2001, Sunday, BC cycle

SECTION: State and Regional

LENGTH: 506 words

HEADLINE: State: Californians cut power use 12 percent last month

BYLINE: By LESLIE GORNSTEIN, AP Business Writer

DATELINE: LOS ANGELES

BODY:

??California businesses and residents cut electricity use by 12 percent in
June
compared with the same period last year, state officials said Sunday - proof,
they said, that the governor's plan for coping with a tight power supply is
working.

??"The people of California are speaking very loudly and very effectively," S.
David Freeman, senior energy adviser to Gov. Gray Davis, said Sunday in a
conference call with reporters.

??Peak electricity demand in June declined by 5,570 megawatts, or 14.1
percent,
compared with June of 2000, according to adjusted figures prepared by the
California Energy Commission. Overall, monthly electricity consumption dropped
12.3 percent.

??One megawatt is enough energy to power 1,000 homes.

??The analysis used raw figures from the California Independent System
Operator, which manages most of the state's power grid.

??The figure provided by the ISO was a reduction of only 3,834 megawatts, the
state officials said. The CEC's adjusted number was higher because it
accounted
for population growth and slightly hotter weather so far this year.

??In June 2000, there were 10 days when electricity demand exceeded 40,000
megawatts. There were no such days in June 2001.

??State officials stopped short of saying the conservation marks an end the
state's energy crisis. But they said Californians' energy-saving measures were
an important reason the state avoided blackouts last month, and added that new
generators going online this summer will give the power grid some breathing
room.

??"The combination of new power plants and conservation is closing the gap,"
Freeman said.

??The first new major power plant in California in more than a decade opened
last week in Bakersfield. Davis, who has said the state's power supply will
grow
by 4,000 megawatts this summer, is expected to appear Monday at the unveiling
of
a new, 500-megawatt plant in Yuba City.

??The CEC report lacked specifics on whether businesses or consumers are
conserving more, or on exactly how most Californians are conserving. But
officials did offer plenty of anecdotal evidence.

??"For whole-house fans, the kinds that replace air conditioners, in one store
in the Sacramento area, last year they sold 18, and this year there were 1,000
sales," said Wally McGuire, the state's conservation campaign manager. "I am
assuming that people are buying them as replacements to air conditioners."

??"Incidentally, the sales of clotheslines in the state are going through the
roof," Freeman said.

??State officials said they did not know how much conservation efforts are
costing the state, but Davis has said that the state has pledged $800 million
to
conservation efforts.

??Freeman said the efforts are saving money that would otherwise be spent
buying power on the spot market.

??Sunday's report roughly matches a similar analysis put out last month about
May electricity demands. That report showed that demand was down 11 percent.
In
April this year, monthly electricity use was down 7 percent over the previous
year.

LOAD-DATE: July 2, 2001


Rhonda,

This is PG&E!  Let me know if we have to change contracts or volumes?

FYI! CCD: PIPELINE CAPACITY CONSTRAINT AT DELIVERY LOCATION.  REDUCTION FOR AN OVER-NOMINATED DELIVERY LOCATION.

Robert

-----Original Message-----
From: CGT_Customer_Services@nisource.com
[mailto:CGT_Customer_Services@nisource.com]
Sent: Monday, October 01, 2001 7:01 AM
To: Ramirez, Robert
Subject: Columbia Reduction for Enron N A

Company: 002909     Arng: 63115-00059     Eff Date: 2001-10-01

                        ----- Receipt -----   ----- Delivery -----
                           Quantity  Cut CD      Quantity  Cut CD

Nominated                        35                    34
Working                          35                    34
Capacity Allocation               0                     0  CCD
Confirmed                         0                     0


Christi,

per your email.

Kay
---------------------- Forwarded by Kay Mann/Corp/Enron on 04/06/2001 10:54
AM ---------------------------

Kay Mann
04/06/2001 05:37 AM
To: Christi L Nicolay/HOU/ECT@ECT
cc:

Subject: MDEA

---------------------- Forwarded by Kay Mann/Corp/Enron on 04/06/2001 05:28
AM ---------------------------

Kay Mann
04/05/2001 08:13 AM
To: Reagan Rorschach/Enron@EnronXGate, David Fairley/Enron@EnronXGate
cc:

Subject: MDEA

Here's a starting point.  I've tried to bracket stuff with open issues like
this [ ], but I'm sure there are more questions than [ ]s.  I'm really
unclear on the financial aspect of the deal.

Reagan, I didn't stop to put the exhibits you sent in, as I thought it was
better to get the doc in your hands (and Mr. Fairley's) for a detailed review.

Kay


Christina,

The Indian Springs plant delivery into HPL will be taken out of service for
repiping work effective Wednesday morning the 15th.   ENA will be moving
Texas Desk purchases via Koch Gateway from Teco Polk Co. Plant (12780) to
MidCon Needville (6350).  I have confirmed available capacity with Koch and
made sure that the IT agreement is evergreen and will work for these
purposes.

Please let me know what I can do to ensure that the nomination process works
as smoothly as possible.  I will work with Daren and Liz to make sure that
the purchase and sales tickets are moved to Koch.  Please let me know who is
responsible for the Transport Usage ticket on Koch, if necessary, I will put
the ticket in this afternoon.  We will be responsible for a $.02 Commodity
fee, ACA of $.0022  and 1.6% fuel (monetizes to $.09 approximately) to move
these volumes.

ENA will be receiving 84,987 Dth at the plant and  delivering 83,627 into
MidCon Texas.  We also have the option to deliver by displacement into MidCon
at Goodrich or Edna, or displace deliveries to Koch Bayside.

Please let me know if you have any questions or need anything further from
me.

Mary

ext. 35251


______________________________________________________
Get Your Private, Free Email at http://www.hotmail.com

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Message-ID: <FB1AC367144FD311A7910008C7E639CD3E6389@exchange.cns.gov>
From: "Liakakos, John" <JLiakako@cns.gov>
To: "'ACHRIST642@aol.com'" <ACHRIST642@aol.com>
Cc: "'Basile'" <opabasile@aol.com>, "Christian, Alfred"
<AChristi@cns.gov>,        "'Dean Skandalis'" <dskandalis@mpegla.com>,
"'gavgerinos@hotmail.com'"  <gavgerinos@hotmail.com>,
"'greekpaul@rocketmail.com'"  <greekpaul@rocketmail.com>,        "'John
Papathakis'" <jpapa@alextom.com>,        "'John Vasilios'"
<john.vasilios@allfirst.com>,        "'lincoln316@go.com'"
<lincoln316@go.com>,        "'Luke Georgalas'" <lukegeor@yahoo.com>,
"'Maria Del Mar Navarro'" <delmar74@yahoo.com>,        "'Melis'"
<melrimer@aol.com>,        "'Michael Skandalis'"
<mikes@mghadvertising.com>,        "'Mike Georgalas'"
<mikegeor@wam.umd.edu>,        "'Paul Handakas'" <Handakas_P@BLS.GOV>,
"'Paul Trintis'" <ptrintis@cs.com>,        "'Sotiri Koumoudis'"
<sotirient@aol.com>,        "'tgerp@hotmail.com'" <tgerp@hotmail.com>,
"'Tim Stayeas'"  <Timothy.Stayeas@digital.com>
Subject: One Liners
Date: Tue, 22 Feb 2000 08:09:21 -0500
MIME-Version: 1.0
X-Mailer: Internet Mail Service (5.5.2448.0)
Content-Type: text/plain; charset="iso-8859-1"
Content-Transfer-Encoding: 7bit

 Which sexual position produces the ugliest children?
 > > > > >
Ask your Mom.
====================================================
How do you know when you're really ugly?
> > > > > >
Dogs hump your leg with their eyes closed.
====================================================
What is the quickest way to clear out a mens restroom?
> > > > > >
Say, "Nice Dick"
=====================================================
How do you know when you're leading a sad life?
> > > > > >
When a nymphomaniac tells you, "Lets just be friends."
=====================================================
Why don't bunnies make noise when they have sex?
> > > > > >
Because they have cotton balls.
=====================================================
Mom's have Mother's day, Dad's have Fathers day, What do single guys have?
> > > > > >
Palm Sunday
=====================================================
Why is being in the Military like a blowjob?
> > > > > >
The closer you get to discharge, the better you feel.
=====================================================
What do you call a 90 year old man who can still masturbate?
> > > > > >
Miracle Whip
====================================================
What does a 75 year old woman have between her breasts?
> > > > >
Her Navel.
=====================================================
What has a whole bunch of little balls and screws old ladies?
> > > > > >
A Bingo Machine.
=====================================================
What's the difference between a porcupine and a BMW?
> > > > > >
A porcupine has the pricks on the outside.
=====================================================
Why did God create alcohol?
> > > > > >
So ugly people could have sex too.
=====================================================
What did the blonde say when she found out she was pregnant?
> > > > > >
"Are you sure it's mine?"
=====================================================
What's the difference between Beer Nuts and Deer Nuts?
> > > > > >
Beer Nuts are $1.25, and Deer Nuts are always under a buck.
 =====================================================
What three two-letter words mean small?
> > > > > >
"Is It In?"
====================================================
Why does Mike Tyson cry during sex?
> > > > > >
Mace will do that to you.
=====================================================
If you are having sex with two women and one more walks in, what do you
have?
> > > > > >
Divorce proceedings most likely.
 ======================================================
Why did OJ Simpson want to move to West Virginia?
> > > > > >
Everyone has the same DNA.
======================================================
A beggar walked up to a well dressed woman on Rodeo Drive and said "I
haven't
eaten anything in four days."

She looked at him and said, "God I wish I had your willpower."
 ======================================================
> > > > > > And some to offend Damn Near Everyone...........
> > > > > >
> > > > > > ======================================================
Did you hear about the Chinese couple who had a retarded baby?
> > > > > >
They named him Sum Ting Wong.
======================================================
What would you call it when an Italian has one arm shorter than the other?
> > > > >
A speech impediment.
======================================================
What does it mean when the flag at the Post Office is flying at half mast?

They're hiring.
======================================================
What do toilets, a clitoris, and an anniversary have in common?
> > > > > >
Men miss them all.
======================================================
Why do men find it difficult to make eye contact?
> > > > > >
Breasts don't have eyes.
======================================================
Why aren't there any Puerto Ricans on Star Trek?
> > > >
Because they're not going to work in the future either.
======================================================
Did you hear about the dyslexic Rabbi?

He walks around saying "Yo."
======================================================
What do you call an Alabama farmer with a sheep under each arm?

A pimp.
======================================================
Why do drivers education classes in Redneck schools use the car only on
Mondays, Wednesdays, and Fridays?

Because on Tuesday and Thursday, the Sex Ed. class uses it.
======================================================
What's the difference between a Southern zoo, and a Northern zoo?

A Southern zoo has a description of the animal on the front the cage, along
with a recipe.
======================================================
How do you get a sweet little 80 year old lady to say F*#@?

Get another sweet little 80 year old lady to yell "Bingo"
======================================================
What's the Cuban National Anthem?

Row row row your boat.
======================================================
What's the difference between a Northern fairytale and a Southern fairytale?

A Northern fairytale begins "Once upon a time"
A Southern fairytale begins "Y'all ain't gonna believe this shit."

John Liakakos
Community Relations Specialist
Northeast Region- NCCC


Hope you're well.  I'll be over sometime this quarter.  Of course the new
house isn't furnished yet.  Who has time to go the grocery store?
The hotel is the Hotel Costes on the Foubourg (sp?) St. Honore.  It's muy
bueno.  Please, let's not telll the world about this gem.

   Merritt Thomas                01/09/2001 03:07 AM

To: Jeffrey A Shankman/HOU/ECT@ECT
cc:
Subject: paris - cool hotel

Jeff,

When you get a chance, could you email me the name of that hotel in Paris you
were telling me about?  My friend Megan and I are going to pop over to Paris
for a weekend later this month and we might check it out.

Hope everything is well with you.  Is the new house all furnished?  Will we
be seeing you on this side of the world anytime soon?

Happy New Year!

Regards,
Merritt


[IMAGE]
[IMAGE]	 [IMAGE]     Dear Jeff Skilling,   Selecting the right gift or seasonal accent to adorn your home  or office is made easy with our original bouquets, orchids and  preserved designs. Each of these intriguing items has its own  character and ambience and is meant to complement the good life.   Take our Orchid  Blaze Bouquet  (shown right) for example. With its fiery orange  orchids and black matte vase, it makes the perfect seasonal centerpiece.  This eye-catching bouquet is easy to arrange too.   The Colmanara  Orchid Plant  is quite possibly the most exciting new orchid  to be introduced in the last decade. This alluring orchid, nicknamed  ?Wildcat? is diligently sought-after for its long lasting  blooms.   Our Antiqued  Holiday Wreath  is a preserved design whose color scheme works  with most decors. It is available with our brass wreath hanger,  making it a breeze to display. And don?t forget the ideal  autumn birthday gift! The Golden  Harvest Roses  bouquet is sure to add special meaning to a  wonderful occasion.  Remember to visit Autumn  Sales  where you will find keen gifts like the Autumn  Jewel Arch  at very special prices!  Calyx  & Corolla   	[IMAGE]
		[IMAGE]
		 -------------------------------------------------------------   If you do  not wish to receive future Calyx & Corolla updates, please reply to this email with "REMOVE jeff.skilling@enron.com" as the  subject line.

[IMAGE]


- 12-28-2001.xls


FYI - Not sure if all of you have this information.

C
---------------------- Forwarded by Caroline Emmert/HOU/ECT on 04/02/2001
03:14 PM ---------------------------

Caroline Emmert
09/07/2000 12:22 PM
To: John M Forney/HOU/ECT@ECT
cc: Chris Stokley/HOU/ECT@ECT
Subject: Buy/Resells - What We Learned

John,

From our research into Avista and others, here is what we have learned about
using Buy/Resells:

Whether to select "Buy From" or "Sell To" upon deal entry is determined by
the ultimate purpose of the BR, as shown here:

Purpose:
Pay the Customer (sleeve or other service they have provided to EPMI)

Type is Buy From
Pricing is:  Buy = EPMI price
      Sell = Customer price

Charge the Customer (services or other, like transmission recapture)

Type is Sell To
Pricing is:  Buy = Customer price
      Sell = EPMI price

I hope this helps to determine the correct way of entering a buy/resell, and
will alleviate settlement discrepancies in the future.  If you agree with
this, feel free to share it with the real time group.

Caroline


Yes.  Contact either Gia or John and get the ball rolling.  Thanks

Michael Terraso
08/18/2000 04:20 PM
To: Steven Kean
cc: Maureen McVicker

Subject: PLEASE READ & RESPOND

Steve, I received this note from Jeff Keeler who is on the government affairs
distribution list.  Would you also want the EHS groups to work with Gia or
John in developing value added documentation for this year's budget process?
Mike
---------------------- Forwarded by Michael Terraso/OTS/Enron on 08/18/2000
04:14 PM ---------------------------

	From:  Jeffrey Keeler                           08/18/2000 02:42 PM

To: Michael Terraso/OTS/Enron@ENRON
cc: Stacey Bolton/HOU/EES@EES, Mary Schoen/NA/Enron@Enron

Subject: PLEASE READ & RESPOND

Mike:   here is a message from Steve Kean that is very relevant to the part
of our call the other day in which we discussed the need to determine what
EHS' (or Environmental Strategies') role should be in communicating with JIm
Steffes' group and documenting the value we add.   I will talk to Jim, but I
am planning to have my group provide this information and meet the deadline
in this memo.   You may want to inquire with Steve as to whether others in
EHS should participate as well.

Jeff
---------------------- Forwarded by Jeffrey Keeler/Corp/Enron on 08/18/2000
03:39 PM ---------------------------

Steven J Kean@EES
08/18/2000 02:39 PM
Sent by: Maureen McVicker@EES
To: Govt Affairs (w/Assts), Mark Palmer/Corp/Enron@ENRON, Karen
Denne/Corp/Enron@ENRON
cc:

Subject: PLEASE READ & RESPOND

Dear Colleagues,

On numerous occasions this past year, Enron Government Affairs (EGA) support
provided to commercial groups resulted in substantial increases in project
economics and enhanced the overall value of many deals. The Regulatory Risk
Analytics group has been tasked to help you quantify EGA,s portion of this
value added over the past year. For budgetary reasons, it is critical for
every EGA member to participate in this exercise and document his/her share
of significant value added.  Please contact Gia Maisashvili or John Neslage
to discuss the  methodology for determining EGA,s value added as soon as
possible.   The contact information for Gia is (713)  853-4346, and for John
its (713) 853-6827.

The dead line for this effort is Friday,  September 1st

Thank you for your cooperation


Just an update: Today I set up a front month fixed price gas daily product
priced at parity to NYMEX.  I thought the response was tremendous.  It really
shows that we might have an angle to put out more of the curve and become the
predominant benchmark for the industry rather than the exchange.

One problem I had was linking 2 syncopated basis products.  I set up a new
product for the prompt that was Nov GD/D Henry Hub that was a syncopated
basis of 0/0 to the Nov Nymex.  However, since Dec Nymex is a syncopated
basis to Nov Nymex, I could not set up a syncopated basis link around the Dec
Nymex.  Any ideas?


Just got this clarified by Scott G., that this is not a special pricing but
like any other contract. ENA will bill CES for both demand and commodity
charges, ENA is billed by TCO for $0.01 demand and commodity and Aristech pays
TCO the remaining demand.

 Jeffrey Porter
 04/20/2000 03:53 PM

To: Chris.Germany@enron.com
cc: Joan.Veselack@enron.com, Kara Destephanis/CES/ColumbiaGas@COLUMBIAGAS,
Robert.Allwein@enron.com, Joann.Collins@enron.com, Doug
Kinney/CES/ColumbiaGas,
John Whited/CES/ColumbiaGas@ColumbiaGas
Subject: Re: COH Choice for 4/21 - PLEASE READ - WEEKEND SETUP

Just a note that the bill from TCO goes to Aristech and CES pays Aristech for
both demand and commodity. Any gas we buy from Enron should not include any
commodity costs. Thanks JPP

Joan.Veselack@enron.com on 04/20/2000 12:12:17 AM
Please respond to Joan.Veselack@enron.com

To: Kara Destephanis/CES/ColumbiaGas@COLUMBIAGAS
cc: Chris.Germany@enron.com, Jeffrey Porter/CES/ColumbiaGas@COLUMBIAGAS,
Robert.Allwein@enron.com, Joann.Collins@enron.com
Subject: Re: COH Choice for 4/21 - PLEASE READ - WEEKEND SETUP

Kara, because we are close on the SST's max MDQ, we are going to use some
of Aristech's Capacity. Also, to be pro-active on the huge temperature
swings that we have been seeing on the weekends, we are going to do a 50/50
split with storage. Hopefully, this will prevent overrun charges and
overdelivery gas. Cross our fingers!!!!!!!!!  This has been approved
through Jeff Porter, the CES Choice God!!!!!

Also Joann Collins is on call this weekend. Friday is an "unofficial
holiday" for us. Joann will be in the office tomorrow morning to do Choice.

Contract Changes:

7-1: 67693     11558
     67829     5000 (aristech capacity)
Total          16558

7-5  67693     9693
     67829     3527 (aristech capacity)
Total          13220

Thank you!!!!!!!!!!!!!!!!!!!!


dkinney@columbiaenergygroup.com on 03/16/2000 10:53:20 AM
To: "        -         *steve.gillespie@enron.com" <steve.gillespie@enron.com>
cc: "        -         *Porter, Jeffrey" <jporte1@columbiaenergygroup.com>,
"        -         *Perrone, Brian" <bperron@columbiaenergygroup.com>, Chris
Germany/HOU/ECT@ECT
Subject: NIPSCO Choice

Steve--The attached file contains estimates for the upcoming 12-month period
of
our monthly flowing volume requirements for the NIPSCO Choice program,
including estimated peak-day requirements (part of which come out of
storage).   I am referring to the values in Cols. L,M, and N in the attached.
Can you please give us a price quote for getting these volumes to the NIPSCO
citygate?

Please call me if you have questions.

Thanks.

Doug Kinney
Ph:  703-561-6339
Fax:  703-561-7317

 - NIPSCO Choice Est Vol Reqs.xls


-----Original Message-----
From: 	"iris mack" <irismmack@hotmail.com>@ENRON
Sent:	Tuesday, January 29, 2002 10:55 AM
To:	Black, Tamara Jae
Cc:	Burnett, Lisa
Subject:	Return to Harvard

Hi TJ and Lisa,
     Happy 2002!!  I hope this email finds you well.
     This brief note is to inform you that I will be returning to Harvard - where I received my doctorate in Applied Mathematics.
     I have accepted a job offer from the Harvard Management Company - which manages Harvard's endowment of $20 billion (and still counting).
     If you are ever in the Boston area, please do look me up.
     Also, will you please forward this email onto the power group so that some of my other friends will know how to get in touch with me in the future.
Best regards to you and yours in 2002,
Iris Marie Mack, MBA/PhD

P.S.:  During my first couple of months in Boston I will be staying in corporate housing.  Therefore the best way to reach me is via email:  irismmack@hotmail.com .  Thanks!!!

Join the world's largest e-mail service with MSN Hotmail. Click Here


The Donald -
Thanks for your help with this.  I'll make sure an invoice is sent.

dkirken@columbiaenergygroup.com on 12/11/2000 10:01:17 AM
To: " - *Colleen.Sullivan@enron.com" <Colleen.Sullivan@enron.com>
cc:
Subject: Re: CES-CDC transaction

Colleen,

Thanks for this (I guess).  If you would have Mary Ellenberger invoice CES for
this as was done for the National Steel 11/00, 12/00 situation, I will see
that
Enron is paid for this.

Thanks,

The Donald

Colleen.Sullivan@enron.com on 12/08/2000 12:01:23 PM
Please respond to Colleen.Sullivan@enron.com

To: Donald Kirkendall/CES/ColumbiaGas@COLUMBIAGAS
cc: Mark.Breese@enron.com, Dick.Jenkins@enron.com, Jeffrey.T.Hodge@enron.com

Subject: CES-CDC transaction

Per our discussion, it has been brought to my attention that there is
another CES transaction that ENA has been asked to serve that we have been
unable to find in any of the CES/ENA contracts or paper work.  It is a
three month transaction for 40,000/day at the Columbia Gulf-Mainline Pool,
priced at the Gas Daily Monthly Index plus $.0125.    The transaction is
with the Columbia Distribution Companies:  Columbia Gas of Ohio, Virginia,
Kentucky, Maryland, and Pennsylvania.  I have sent copies of the agreements
to you via fax.

The good news is that this is an index transaction, so there is no forward
exposure.  The bad news is that, since we did not know about this
transaction prior to the beginning of December, by the time CDC contacted
us (because there was no nomination made), prices had risen considerably
from the first of the month index.  ENA immediately purchased base load
supply to cover this, which at this point has drastically reduced the
exposure; however, ENA will look to CES to cover the difference between the
contract price and the rest of the month pricing as of 12/1/00.

The weighted average price of rest of the month sales at the Henry Hub on
EnronOnLine for 12/1/00 was $6.6125.  Since Henry Hub is a more liquid
location than Columbia Gulf-Mainline, that is how the transaction was
hedged.  The basis difference between Henry Hub and Columbia Mainline (per
the monthly indices) was $.05, making ENA's cost to cover the CDC volumes
$6.6625.  This makes the total dollar amount $706,800  (40,000/d x 31 days
x the difference between the contract price and the cost to cover, or
$.57).

Please call me once you have had a chance to review this with the proper
CES representatives or if you have any questions.  My number is
713/853-5514.  Thanks for your assistance.


I will continue to run the financial risk desk.

 -----Original Message-----
From: 	Zipper, Andy
Sent:	Wednesday, February 06, 2002 3:17 PM
To:	McLaughlin Jr., Errol
Subject:	RE: UBS Group

I will be running the power options desk with UBS. I will still be trading gas though. how about you ?


hey lucky fuck.  i just gave you $20 instead of $15 for the $20 you gave me.
so you still owe me $5.  i can't believe you didn't tell me i was making a
mistake and stole $5 from me.  i am gonna have to regulate.


Oh no, that is too short of a response.  Please don't be upset.  I want to be with you sooooooooooo bad.  I hope you know that.

 -----Original Message-----
From: 	Villarreal, Alexandra
Sent:	Thursday, October 18, 2001 3:26 PM
To:	Griffith, John
Subject:	RE:

thats fine

 -----Original Message-----
From: 	Griffith, John
Sent:	Thursday, October 18, 2001 3:23 PM
To:	Villarreal, Alexandra
Subject:

Oh by the way, I am going to take my car in on Monday, so maybe you can give me a ride on Monday.  I will let you know, thanks for the offer.  I do not know what I am doing this evening yet.  Probably not have time to do anything, I thought I would.  I am sorry.   I would like to meet for breakfast though.  Hope you have time.

I miss you today.