-----Original Message-----
From: Yee, Colin
Sent: Friday, January 25, 2002 9:01 AM
To: Alder, Doug; Bain, Stacy; Engelhardt, Matthew; Maxwell, Tara;
Simpson, Regan; Steinke, Nathan; Tymofichuk, Christin
Subject: FW: The Rules of Manhood

-----Original Message-----
From: Colin Yee [mailto:cmyee@home.com]
Sent: Thursday, January 24, 2002 10:26 PM
To: mandmmitton@shaw.ca; cmyee@collinsbarrow.com; Wes Giebelhaus
Subject: Fw: The Rules of Manhood

> The Rules of Manhood
>  >>>
>  >>> *  Thou shall not rent the movie Chocolat.
>  >
>  >>> * In Black Jack, always split aces  and eights. No arguments.
>  >
>  >>> * Under no circumstances may two men  share an umbrella...
>  >
>  >>> * Any man who brings a camera to a  bachelor party may be legally
> killed
>  >>> and eaten by his fellow  partygoers.
>  >
>  >>> * When you are queried by a buddy's wife,  girlfriend, mother,
> father, priest, shrink, dentist, accountant or  dog walker, you need
not
and
> should not provide any  useful information whatsoever as to his
whereabouts.
> You are permitted to  deny his very existence.
>
> * Unless he murdered someone in your  immediate family, you must bail
a
> friend out of jail within 12  hours.
>
> * You may exaggerate any anecdote told in a bar by 50  percent without
> recrimination; beyond that, anyone within earshot  is allowed to
> call,"Bullshit!". (Exception: When tryi
> ng to pick up  a girl, the allowable
> exaggeration rate rises to 400  percent.)
>
> * If you've known a guy for more than 24 hours, his  sister is off
limits
> forever.
>
> * The maximum amount of time  you have to wait for another guy who's
>>>
> running late is 5 minutes.  For a girl, you are required to wait 10
>minutes
> for  >>> every point of  hotness she scores on the classic 1-10 scale.
>
> * Bitching about  the brand of free beer in a buddies refrigerator is
>  >>> forbidden. You  may gripe if the temperature is unsuitable.
>  >
> * No man is ever  required to buy a birthday present for another man.
In
>  >>> fact, even  remembering a friends birthday is strictly optional.
>
> * Agreeing  to distract the ugly friend of a hot babe your buddy is
>  >>trying to hook up  with is your legal duty. Should you get carried
away
>  >with your  >>> good  deed and end up having sex with the beast, your
pal
> is forbidden to  >>speak  of
> it, even at your bachelor party.
>
> * Before dating a buddy's  ex, you are required to ask his permission
>  >and he, in return, is required to  grant it.
>  >
> * Women who claim they "love to watch sports" must be  treated as
spies
>>>
> until they demonstrate knowledge of the game and  the ability to pick
a
>  >Buffalo wing clean.
>
> * If a man's  zipper is down, that's his problem- you didn't see
>  >nothin'.
>
> * The universal compensation for buddies who help you move is beer.
>
> * A man must never own a cat or like  his girlfriend's cat.
>
> * Your girlfriend must bond with your  buddy's girlfriends within 30
>  >>> minutes of meeting them. You,  however, are not required to make
nice
>  >with her  >>> girlfriend's  significant dick-heads --- low-level
sports
> bonding is all  >>> the law  requires.
>
> * When stumbling upon other guys watching a sports  event, you may
>  >always ask the score of the game in progress, but you may  never ask
w
> ho's
>   >playing.
>  >
>  >>> * When your girlfriend/wife expresses  a desire to fix her whiney
> friend >>up with your pal, you may give her the  go-ahead only if
you'll
be
> able to  >>> warn your buddy and give him  time to prepare excuses
about
> joining the  >>> priesthood.
>  >
>  >>> * It is permissible to consume a fruity chick drink only when
you're
>  >>> sunning on a tropical beach... and it's delivered by a  topless
super
>  >model...and it's free.
>  >
>  >>> * A man in the company  of a hot, suggestively dressed woman must
> remain  >>> sober enough to  fight.
>  >
>  >>> * If a buddy is out numbered, out manned, or too drunk  to fight,
you
>  >>must jump into the fight. Exception: If within the last 24  hours
his
> actions  >>> have caused you to think, "What this guy needs is  a good
> ass-whooping",  >then  >>> you may sit back and enjoy.
>  >
>  >>>
> * Friends don't let friends wear Speedos. Ever. Issue closed.
>  >
>  >>> * Never hesitate to reach for the last beer or the last slice of
> pizza,  >>> but not both. That's just plain mean.
>  >
>  >>> * If  you compliment a guy on his six-pack, you better be
referring
to
>  >>his  beer.
>  >
>  >>> * Never join your girlfriend/wife in dissing a buddy,  except
when
> she's  >>> withholding sex pending your  response.
>  >
>  >>> * Never talk to a man in the bathroom unless you're  on equal
footing;
>  >>> either both urinating or both waiting in line. In  all other
> situations,  >a nod  >>is all the conversation you need.
>  >
>  >>> * If a buddy is already singing along to a song in the car, you
may
> not  >>> join him....
>  >
>  >>> * If fast dancing is  absolutely necessary, a man may NEVER raise
his
>  >>hands above shoulder  level ....
>  >
>  >>
> ;> * Before allowing drunken friend to cheat  on his girl, you must
> attempt  >>> one intervention. If he is able to  get on his feet, look
you
> in the eye,  >and deliver a, "F--- OFF!", you are  absolved of all
> responsibility.
>
> * The morning after you and a  babe who was formerly "just a friend"
>have
> carnal, drunken monkey sex, the  fact that you're feeling weird and
>  >>guilty is no reason not to nail her  again before the discussion
about
>  >what a big  >>> mistake it  was.
>
>
>


ENE Sells to Bank of America out of the money swap    Apr 2 Dec 2
ENE Buys out of the money from Duke                         Apr 2 Dec 2
Duke buys out of money from B of A                             Apr 2 Dec 2

Volumes and Price to be set in order to create about $30-$50 million depending on ENE exposure to Duke

-----Original Message-----
From: Arnold, John
Sent: Tuesday, November 06, 2001 9:20 PM
To: Quigley, Dutch
Subject: RE: Diamond Shamrock Refining Company LP

am i suppose to call?

-----Original Message-----
From: Quigley, Dutch
Sent: Tue 11/6/2001 2:30 PM
To: Arnold, John
Cc:
Subject: FW: Diamond Shamrock Refining Company LP

 -----Original Message-----
From:   Vanek, Darren
Sent:   Tuesday, November 06, 2001 1:58 PM
To:     Quigley, Dutch
Subject:        Diamond Shamrock Refining Company LP

Dutch-
Kerry O'Brien
210-592-4449

I really have not given Kerry any information except that I would look into the situation.


hey, Adam!

My name is Joseph and I'm assistant to Jeff Dasovich, who forwarded your
e-mail to me, as well
as Mona Petrochko, both of whom are directors here in the San Francisco
office.

Please note our address as follows, which applies to Jeff, Mona and myself:

Enron Corp.
101 California Street
Suite 1950
San Francisco CA  94111

Jeff's phone:    415.782.7822
e-mail:   jeff.dasovich@enron.com

Mona's phone: 415.782.7821
e-mail:   mona.l.petrochko@enron.com

my phone:  415.782.7841
e-mail:   joseph.alamo@enron.com

Our fax number: 415.782.7854

Adam, I hope this helps, and if you have any more questions or need any more
info, please do not
hesitate to contact me.  (Are you new?? Welcome aboard, fellow Admin!)

Thanks,

Joseph Alamo
Sr. Administrative Assistant
Government Affairs - The Americas
San Francisco CA

---------------------- Forwarded by Joseph Alamo/NA/Enron on 11/29/2000 02:01
PM ---------------------------
From: Jeff Dasovich on 11/29/2000 03:43 PM CST
Sent by: Jeff Dasovich
To: Joseph Alamo/NA/Enron@Enron
cc:

Subject: Re: Address Information

Can you get this kind person the info?  Thanks very much.

	"ADAM KRISTENSEN" <adamk@sheltercorp.com>
	11/29/2000 03:32 PM

		 To: jeff.dasovich@enron.com
		 cc:
		 Subject: Address Information

Mr. Dasovich,

Hello, my name is Adam, and I work as an administrative assistant to
Ms. Susan Landwehr in Enron's Minneapolis satellite office.  She has
asked me to compile an address list of several of her colleagues,
including yourself.

Unfortunately, I have been unable to find your street address or that
of your coworker, Mona Petrochko.  If you could email this
information back to me, it would be much appreciated.  Thanks.

Adam Kristensen
ENRON Corp.


Per Brad Schneider,


Tana -

Please forward copies of the ETA and PA to Paul Davis (e-mail address
above).  If you don't have them in your directory, Frank Davis should be able
to get them to you.

Thanks,

Mark


So no messages from you all day long. Out of sight, out of mind I guess.
Heather Kroll


With respect to Western Area Power Administration - CRSP.  Can't "ditto"
Credit on that one, Credit gives no direction as to what they want to trade.
The database reflects that Leslie approved them to trade power already in
July of last year, so my intention is to keep them open.  I don't know what
"CRSP" means at the end of their name, do you?

	Shari Stack
	02/22/2001 04:16 PM

		 To: Tana Jones/HOU/ECT@ECT
		 cc: Rhonda L Denton/HOU/ECT@ECT, Leslie Hansen/HOU/ECT@ECT
		 Subject: Re: EOL approvals, 2-21-01

With regard to:

UAMPS: Approved for West Physical Power, Buys and Sales
Western Area Power Administration: Approved for West Physical Power, Buys and
Sales

With regard to:
Utah Municipal Power Agency: NOT APPROVED  (not a current CP/Not FERC
authorized)

With regard to everyone else on the list:

Ditto Credit

Thanks,

Shari

	Tana Jones
	02/21/2001 03:14 PM

		 To: Alan Aronowitz/HOU/ECT@ECT, Jeffrey T Hodge/HOU/ECT@ECT, Shari
Stack/HOU/ECT@ECT, Harry M Collins/HOU/ECT@ECT, David
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt, Marie Heard/Enron
Communications@Enron Communications, Robbi Rossi/Enron Communications@Enron
Communications, John Viverito/Corp/Enron@Enron, Jane McBride/AP/Enron@Enron,
Andrea Calo/SA/Enron@Enron, Peter Keohane/CAL/ECT@ECT
		 cc:
		 Subject: EOL approvals, 2-21-01

----- Forwarded by Tana Jones/HOU/ECT on 02/21/2001 05:14 PM -----

	Walter Guidroz@ENRON
	02/21/2001 05:09 PM

		 To: Karen Lambert/HOU/ECT@ECT, Tana Jones/HOU/ECT@ECT, Samuel
Schott/HOU/ECT@ECT, Mark Taylor/HOU/ECT@ECT, Brant Reves/HOU/ECT@ECT, Debbie
R Brackett/HOU/ECT@ECT, David Hardy/LON/ECT@ECT, Lesli Campbell/HOU/ECT@ECT,
Cynthia Clark/Corp/Enron@ENRON, Enron Europe Global Contracts and Facilities,
Enron Europe Global CounterParty/LON/ECT@ECT, Stephanie Sever/HOU/ECT@ECT,
Tom Moran/HOU/ECT@ECT, Claudia Clark/HOU/ECT@ECT, William S
Bradford/HOU/ECT@ECT, Lisa Lees/HOU/ECT@ECT, Juana Fayett/Corp/Enron@Enron,
Jana Morse/Corp/Enron@Enron, Trang Le/HOU/ECT@ECT, Paul Maley/LON/ECT@ECT,
Sonya Clarke/LON/ECT@ECT, Lee Munden/LON/ECT@ECT, Tim Davies/LON/ECT@ECT,
Karen O'Day/NA/Enron@Enron, Tanya Rohauer/HOU/ECT@ECT, Kelly
Lombardi/NA/Enron@Enron, Brian Lindsay/Enron Communications@Enron
Communications, EOL Call Center, Bernice Rodriguez/HOU/ECT@ECT, Bill D
Hare/HOU/ECT@ect
		 cc:
		 Subject: EOL approvals, 2-21-01

Please see attached.


California and Energy Providers in Talks Over Electric Fees
The New York Times, 06/26/01

Taking No Chances; Disaster-Conscious Firms Treat Global Warming as a Reality
The Washington Post, 06/26/01

Conflict of Interest
Los Angeles Times, 06/26/01

India Flagging Asset Sales Risk Lower Moody's Outlook (Update2)
Bloomberg, 06/26/01

SMARTMONEY.COM: California Dreamin'
Dow Jones News Service, 06/25/01

Much Calif Power Price Gouging Beyond FERC's Reach -ISO
Dow Jones Energy Service, 06/25/01

Oregon House May Vote Monday On Electricity Deregulation
Dow Jones Energy Service, 06/25/01

USA: Fresh look at wind energy blows to US from Europe.
Reuters English News Service, 06/25/01

USA: UPDATE 3-Some $15 billion at stake in US power refund talks.
Reuters English News Service, 06/25/01

USA: FPL starts wind farm to power 10,500 Wisc. homes.
Reuters English News Service, 06/25/01

USA: Calif says power refund demand will top $9 billion.
Reuters English News Service, 06/25/01

Business/Financial Desk; Section C
California and Energy Providers in Talks Over Electric Fees
By JOSEPH KAHN

06/26/2001
The New York Times
Page 7, Column 1
c. 2001 New York Times Company

WASHINGTON, June 25 -- For the first time since the end of the Clinton
administration, California and the companies that sell it electricity sat at
the same table today to try to resolve a multibillion-dollar feud over the
state's energy bills.
California is demanding that power companies refund as much as $9 billion for
what it says were overcharges, while power companies say that the state's
nearly insolvent utilities owe them billions of dollars. City and state
officials from across the West are also participating in the negotiations.
The Federal Energy Regulatory Commission convened the talks, which are
scheduled to last up to two weeks. The sessions are the first since top
Clinton administration officials tried and failed to broker a settlement to
California's electricity crisis in their waning days in office.
''The time to put California's past energy problems to rest and structure a
new arrangement for California's energy future is now,'' said Curtis Wagner,
an administrative law judge for the energy commission who is presiding over
the settlement talks.
The proceeding, which was standing-room-only on opening day, attracted scores
of people representing multiple sides in the dispute. The main participants
are electricity generating companies, electric utilities, and public
officials from state and local governments and regulatory agencies.
Mr. Wagner urged the public officials and companies involved to reach an
agreement on how much California and other states in the Western grid should
have paid for power over the last year, when California's partly deregulated
market broke down. He said that if they failed to do so by July 10, he would
recommend a solution to the energy agency's five commissioners, who would
then have the option of imposing a settlement.
Wholesale power costs in California, which totaled $7 billion in 1999, soared
to about $27 billion last year and, by some state estimates, could double
again this year. The higher costs, which have not been fully passed along to
consumers, have rendered California's two main utility companies unable to
pay their bills and forced the state to buy power in their place.
The opening bid by Gov. Gray Davis, who set out his views in a letter sent to
the energy commission today, is that the leading electricity generators
should refund about $9 billion that ''they have overcharged the people of the
state of California.'' Michael Kahn, chairman of the California Independent
System Operator, is leading the state delegation.
Generating companies have dismissed that figure as grossly inflated. They
acknowledge that prices are high. But they say the charges are linked to
shortages of natural gas, a crucial fuel for electricity generation, and were
set fairly in a free market.
The companies also contend that a large proportion of what they have billed
California is a credit premium justified because wobbly utilities owe them as
much as $15 billion. Reliant Energy, Duke Energy, the Williams Companies, the
Enron Corporation and the Mirant Corporation are among the major sellers of
electricity in the Western region.
The energy commission, which has the duty of determining ''just and
reasonable'' electricity prices under a New Deal-era law, long ago found that
the California market had become dysfunctional and that prices were
unjustified. But the agency has struggled to come up with a method for
determining fair rates, changing its method three times in recent months.
So far, the agency has identified about $125 million in potential
overcharges. But that number was reached using a restrictive method that the
agency has since abandoned.
Last week, the agency adopted a new price control regime that is intended to
limit price spikes throughout the West. If the controls it is using now were
retroactively applied to electricity sales made over the last year, the
generators would be asked to refund much more money. By some estimates, the
refunds could total more than $1 billion but seem likely to fall well short
of the $9 billion California is seeking.

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

Financial
Taking No Chances; Disaster-Conscious Firms Treat Global Warming as a Reality
Greg Schneider
Washington Post Staff Writer

06/26/2001
The Washington Post
FINAL
E01
Copyright 2001, The Washington Post Co. All Rights Reserved

After two unusually warm winters melted profits at his natural gas
distributing company in Dallas, Robert W. Best decided he needed protection.
So he spent $4.9 million on a new tool called weather insurance.
If global warming causes the customers of his Atmos Energy Co. to continue
using less gas to heat their homes, the policy will pay out cash to offset
the company's operating losses.
That's the kind of practical response beginning to take place throughout U.S.
industry as business leaders face up to the prospect of climate change.
While the Bush administration debates other governments about whether
man-made pollution causes global warming -- and, if so, who should take
responsibility -- many industries are trying to cope with the realities of
extreme weather.
Insurance companies have begun hiring meteorologists to reassess the risk of
natural disasters. Farmers are planting different types of crops and looking
for crisis-proof seeds. Great Lakes shipping companies are petitioning
Congress for dredging to compensate for falling water levels. Colorado ski
resorts are discounting tickets to bring people back to the slopes after two
sweaty winters.
These changes are incremental, not massive shifts in operations. But over
time, those incremental reactions could add up to a major adaptation to
"climate change's pervasive and growing impacts over the next century," said
Nick Sundt, a scientist with the U.S. Global Change Research Program in
Washington.
"I don't know for sure about global warming, but I do know the past 15 or 20
years have been warmer than normal," said Best, the chairman, president and
chief executive of Atmos. "Some people will claim it's the natural cycle, but
for us it doesn't really matter. . . . We've got to do something to protect
ourselves."
Atmos, which distributes natural gas in 11 states, including Virginia, began
investing in weather insurance a year ago. The winter that began in November
1998 and the one that followed were both more than 15 percent warmer than
usual across the company's entire market, Best said.
He read about weather insurance in a trade journal and bought it through
energy broker Enron Corp. If temperatures had been warmer than average last
winter by a certain amount, Atmos would have gotten money back. As it turned
out, last winter was slightly cooler and the insurance didn't kick in. But
Atmos, concerned about the broader warming trend, has signed up for two to
three more years.
Enron began offering the insurance in about 1997, said Todd Kimberlain, chief
meteorologist for Enron Weather Risk Management. El Nin~o -- a periodic flow
of warm surface water in the Pacific that disrupts weather patterns worldwide
-- had produced several extremely warm winters, and companies were looking
for a way to make themselves less financially vulnerable, Kimberlain said.
Some scientists believe El Nin~o and other weather systems intensify when
gases such as carbon dioxide are released into the atmosphere by the burning
of fossil fuels. Such substances are called greenhouse gases because they
tend to trap heat, warming up the earth's surface.
The extra heat could provide energy to drive El Nin~o, hurricanes and other
weather events. Warmer air can hold more moisture, so when it does rain,
there is more potential for flooding. The real danger of global warming, some
scientists say, is that it could produce greater extremes in the weather -- a
possible explanation for such recent phenomena as unforeseen high storm waves
in the North Atlantic and flooding in Europe.
An unusually fierce El Nin~o has been blamed for reducing water levels in the
Great Lakes over the past three years. Pleasure boats float below dock level
and cargo ships can't pull up to shore to unload -- all symptoms of a problem
that caused shipping companies to lose thousands of tons of carrying capacity
last year.
George J. Ryan, president of the Lake Carriers' Association of shipping
companies, said he personally worries about the causes of the lower water
levels, but professionally just has to focus on the solutions. "I have to say
from an industrial standpoint, I just have to consider what it will take for
us to remain competitive," he said.
While Great Lakes water levels have gone through low cycles in the past, Ryan
said, none of them came on as quickly as the most recent cycle. The recent
warm winters prevented the lakes from freezing, causing them to continue
evaporating year-round.
For now, boating interests are asking Congress to spend about $2 million to
deepen a pair of Great Lakes channels. But both industry and scientists fear
global warming could cause long-term water loss -- predicted to be as much as
four feet by the end of the century -- that would require far more expensive
dredging and could even threaten the U.S. steel industry with crippling
transportation costs.
The same uncertainty has affected the recreational skiing industry. Beginning
in 1998, U.S. ski resorts suffered two straight winters of unusual warmth and
low snowfall. While this year brought better conditions for the Northeast,
several resorts in Colorado had to extensively discount tickets to boost
their business. That led to sharp drops in profits.
On the other hand, business is fine for Areco Snow Systems North America, the
Vermont-based distributor of Swedish snow-making equipment. Artificial snow
has become the only way ski resorts can guard against increasingly erratic
winters, said the company's president, Peter Geise. "There's definitely a
warming trend," he said.
For some industries, the biggest worry is that the weather is becoming more
unpredictable and extreme.
"What's of increasing concern to those in agriculture is that it seems like
we have greater variation in the weather," said Richard Stuckey, past
executive vice president of the Iowa-based Council for Agricultural Science
and Technology.
What farmers really need, he said, are seeds that can withstand both drought
and floods. In western Iowa, for instance, a recent period of unusual dryness
led farmers to switch from corn to the more drought-resistant sorghum. But
now they are struggling with unseasonably cool, wet weather.
Wanda Sorrells hears similar complaints from gardeners all over the country
who call her for advice at the Park Seed Co. in Greenwood, S.C. As a senior
staff horticulturist, Sorrells said she has become increasingly perplexed by
the weather extremes she hears about from customers.
"There just seem to be unusual occurrences and these fluctuations where it
will be unusually warm for a few weeks and then unusually cold, and that can
be hard on certain plants," Sorrells said.
The biotechnology giant Monsanto Co. has an extensive search program for
plant genes that are resistant to drought and other stresses in hopes of
engineering hardier crops. While a company spokesman said those efforts are
not aimed specifically at global warming, they are in response to an
increasing demand from farmers for more resilient plants.
Agricultural scientists agree there are higher levels of carbon dioxide in
the atmosphere. But they disagree on whether the increase is caused by human
activity and whether it leads to global warming. Higher carbon dioxide is not
necessarily bad for agriculture; it's what plants breathe, after all.
Even climatic warming could have short-term benefits.
"The temperature change in itself might lengthen the growing season and it
might enable people farther north to grow crops that are now" not feasible,
said Paul Waggoner, a scientist at the Connecticut Agricultural Experiment
Station in New Haven. "Maybe the Dakotas would become like Kansas. You'd go
from spring wheat to winter wheat. That sort of thing."
While farmers have years to adapt to such potential changes, the uncertainty
alarms another industry: insurance, which needs to understand long-term risk
to set rates and stay financially viable. "They don't want to get caught
behind the eight ball and have the risks change without them knowing about it
in advance," said John M. Wallace, a professor of atmospheric sciences at the
University of Washington who has taken part in national climate studies.
Many of his colleagues, Wallace said, have held conferences to explain
climate change to the insurance industry, "and they're starting to hire some
of our graduates, as well."
One of those graduates is Lixin Xeng, who advises insurance companies as a
vice president for risk analysis and technology services at Benfield Blanch
Co., a global risk management and distribution firm.
"This year is warmer than 50 years ago on average, no argument," Xeng said.
"And what we're interested in is whether this warming causes more natural
disasters to occur."
Those disasters can range from the unexpected ferocity of a Hurricane Andrew,
which devastated southern Florida in 1992, to the spread of a tropical
disease such as the West Nile virus in a temperate place such as New York.
Meanwhile, British Petroleum PLC not only accepts that rising levels of
carbon dioxide are causing the earth's average temperature to rise, it hopes
to make a profit on it. The company is looking for profitable ways to reduce
emissions and hopes to become the world's largest manufacturer of solar
energy equipment.
"Now people are starting to look at this as a business opportunity," said
Jeff Morgheim, who occupies a new position at BP: climate change manager.
Companies, he said, are starting "to look at this in a whole new way."

http://www.washingtonpost.com

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

California; Letters Desk
Conflict of Interest

06/26/2001
Los Angeles Times
Home Edition
B-12
Copyright 2001 / The Times Mirror Company

Re "Army Boss Vows No Conflict in Enron Ties," June 20:
I see that Army Secretary Thomas E. White Jr., holder of $25 million worth of
stock in the Enron energy company, is seeking advice from Army lawyers about
whether to recuse himself from any role in Army decisions on Enron contracts.
This is the same man who vowed in his confirmation hearing: "I will
personally commit to you to avoid even any appearance of a conflict in terms
of any future relationships that Enron may choose to have with the department
or attempt to have with the department."
Would somebody please tell Secretary White that no decent, honest person
needs a lawyer to tell him that he does, indeed, have a very serious conflict
of interest.
Bill Sharp
Huntington Beach

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

India Flagging Asset Sales Risk Lower Moody's Outlook (Update2)
2001-06-26 01:50 (New York)

India Flagging Asset Sales Risk Lower Moody's Outlook (Update2)

     (Adds date Fitch lowered its outlook.)

     Mumbai, June 26 (Bloomberg) -- India must step up sales of
state assets and trim its budget deficit to avoid a reduction in
the outlook for its debt, said Kristin Lindow, vice president and
lead analyst for India at Moody's Investors Service.
     ``We are disappointed and would like to see urgency in
completing the economic reform process,'' Lindow said in an
interview. ``Our positive outlook on India is getting to a point
where we are wondering whether it shouldn't be changed.''
     A lower outlook for India's debt would mean the country and
its companies would miss a chance to reduce their borrowing costs,
among the region's highest. The yield on India's benchmark 10-year
bond fell 5 basis points to 9.52 percent today on expectations of
an interest rate cut. That's higher than 6.33 percent for
comparable Chinese bonds and 6.44 percent for South Korean bonds.
     Moody's gave India a positive outlook in June 1999, meaning
it was considering an upgrade of its ``Ba2'' rating, which is two
notches below investment grade and among the lowest in the region.
Since then, India has missed targets for the sale of state assets,
a move that would boost corporate performance and raise revenue
for the state.
     ``The timing of the government's sale of state-run companies
isn't good,'' Lindow said. ``Several of the companies have now
become unprofitable.''
     Among the state-run companies to be privatized are Indian
Airlines and Bharat Heavy Electricals Ltd., a maker of power plant
equipment.

                         Airline Loss

     Indian Airlines lost 1.77 billion rupees ($38 million) in the
year ended March 31 and is expected to lose another 2.51 billion
rupees this financial year, according to media reports. Bharat
Heavy Electricals' profit for the year ended March 31 dropped 49
percent to 3.05 billion rupees.
     India needs money from sales in stakes of more than 200
companies to trim its budget deficit. In the fiscal year that
ended March 31, India planned to sell stakes in 43 companies to
raise 100 billion rupees. It made just one sale -- a 74 percent
stake in a bakery, Modern Food Industries, for 1 billion rupees.
     This year, India plans to raise 120 billion rupees through
asset sales. The government plans to trim the deficit to 4.7
percent of gross domestic product this fiscal year from an
estimated 5.2 percent of GDP last year.

                    Falling Bond Yields

     Government bond yields have been falling to record lows on
expectations that the Reserve Bank of India will cut interest
rates, following a widely predicted move by the U.S. Federal
Reserve later this week.
     ``There won't be any movement in the market based on the
possibility of Moody's lowering its outlook on India,'' said Rajiv
Anand, who manages 16 billion rupees of Indian debt for Standard
Chartered Mutual Fund. ``The correction would happen if Moody's
actually downgraded the rating.''
     Bond yields rose after ratings company Fitch cut India's long-
term sovereign ratings outlook to ``negative'' from ``stable'' on
May 31. Fitch, which rates India ``BB plus,'' one notch below
investment grade, cited ``concerns about fiscal policy,
privatization and a deterioration in the investment climate.''

                         Enron Dispute

     Lindow of Moody's said she was concerned about a dispute
between the Maharashtra State Electricity Board and Enron Corp.,
the country's biggest foreign investor, which built a $3 billion
power plant. The dispute is widely seen as a litmus test for
foreign investment in India.
     The state electricity board has refused to pay 3 billion
rupees for power supplied by Enron's local unit, Dhabol Power Co.
India hasn't delivered on guarantees to pay for the power. Lindow
also cited the Enron dispute as a cause
     ``Foreign investors are becoming wary because of Enron's
problem and the government failure to honor its contractual
obligation,'' Lindow said. ``It has put up several red flags.''
     A third major ratings company, Standard & Poor's, rates India
``BB,'' two notches below investment grade.

SMARTMONEY.COM: California Dreamin'
By Michael DeSenne

06/25/2001
Dow Jones News Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Of SMARTMONEY.COM

DESPITE THE ROUND-THE-CLOCK efforts of state and federal officials to solve
California?s energy crisis, residents are bracing for more rolling blackouts
this summer. And while the nation?s energy prices on the whole are starting
to decline, it?s clear that fossil fuels won?t light our homes and cool our
offices forever.
Even President Bush, a loyal oilman, understands this reality. While pushing
a reform plan heavy on fossil fuels last month, he acknowledged the need for
new, alternative-energy sources.
Of course, there?s still no consensus on what those sources will be, and this
is a high-risk game. Investors who pick correctly from among the leading
possibilities could find themselves sitting on a gusher during the next
energy crunch. But as anyone who invested in previous alternative-energy
sources like solar power, ethanol or - god forbid - cold fusion - can attest,
this is a business that?s big on dreams, long on waits and short on
commercially viable technologies.
And even the long-term winners among these stocks (if there are any) can be
counted on to deliver some major volatility in the meantime. The blame for
that goes to the California crisis, whose twists and turns drive
alternative-energy stocks up and down, headline by headline. "Anytime it
appears that the California panic is being solved, these stocks tend to trade
down, so the sentiment is shifting on a daily basis," says Christine Farkas,
a Merrill Lynch energy analyst.
For adventurous investors who find such prospects electrifying, the most
promising technology at this point seems to be the fuel cell, a device that
extracts hydrogen from fossil fuels such as natural gas or coal and converts
it into electricity. Environmentalists love fuel cells because the byproducts
of the electrochemical process - mostly heat and water vapor - include few
harmful emissions, especially when compared with what?s put out by internal
combustion engines.
Right now, the fuel-cell sector is crowded, with different companies at
different stages of the product-development cycle aiming for different
end-users. While some are building smaller fuel-cell systems to power cars,
others are constructing large fuel-cell-powered plants that can meet the
electricity needs of huge factories. Still others are targeting residential
uses. Which ones are likely to emerge as leaders? One may be FuelCell Energy
(FCEL). According to Chief Executive Jerry Leitman, the Danbury, Conn.-based
fuel-cell developer expects to start booking orders by year?s end for its
first product, a 300-kilowatt power plant roughly the size of a semi-trailer
that can light up the equivalent of 100 homes. Quieter and more mobile than
traditional electricity generators, the fuel-cell-powered plants can be
located closer to commercial and industrial customers, such as hospitals and
office buildings. Eventually, FuelCell plans to roll out 1.5 megawatt and
three megawatt units. Investors seem to like what they see. FuelCell?s stock
price, while highly volatile, has jumped 76% over the past year. (By
contrast, fuel-cell rival Plug Power?s (PLUG) residential products are
further from retail reality - and its stock is down 65% in the past 12
months. The same goes for Ballard Power Systems (BLDP), a Canadian firm
targeting the auto industry, whose shares have lost 50% in the last year.)
Earlier this month, FuelCell netted $241.5 million through a secondary stock
offering. CEO Leitman says the proceeds will be used to boost annual
manufacturing capacity to between 400 megawatts and 500 megawatts, a goal he
expects to reach in 2004. "That puts us into a profitable position when we
get to that 400 to 500 megawatts of production," he says. (Leitman declined
to offer more specific profit projections.) Merrill Lynch expects the company
to hit 400 megawatts of capacity in 2004 or 2005, with profitability coming
in 2005. In the interim, however, the earnings picture isn?t pretty. For its
second quarter ended April 30, FuelCell booked just $6.5 million in revenues
and posted a net loss of $5.1 million.
FuelCell investors were reminded about quickly shifting sentiment last
Tuesday. During a hearing over state funding of an Enron (ENE) fuel-cell
project in Connecticut, opponents of the plan suggested the money could be
better spent on other power endeavors. As a result FuelCell, which would
supply fuel cells to the power-plant project, saw its shares fall 17% to
$24.50 that day. In response to the sell-off, Friedman Billings upgraded the
stock to Buy from Accumulate, saying the drop was unwarranted since long-term
fundamentals remain very positive. FuelCell shares jumped 10% to $26.97 on
Wednesday. A final decision on the funding won?t be handed down by state
regulators until September. The next hearing is scheduled for mid July.
Another promising player is Active Power (ACPW), an Austin, Texas-based maker
of battery-free backup power systems. The gist: A spinning steel disk stores
kinetic energy, which kicks in when a primary power supply goes down. The
target audience includes high-tech firms and telecoms that rely on
uninterrupted power supplies. Active Power says one of its systems, about the
size of a refrigerator, replaces 50,000 pounds of lead and sulfuric-acid
batteries.
The good news: Active Power already has products on the market. The most
promising, which went on sale last summer, is the CAT UPS, a flywheel-based
backup power system jointly developed with Caterpillar (CAT). Base units
retail for $90,000 to $115,000, with top-of-the-line configurations selling
for as much as $350,000. The product, which is expected to make up about 80%
of Active Power?s sales for 2001, is already having an impact on the top
line: Revenues jumped to $5.1 million in the first quarter, up 91% from the
fourth quarter. (It posted a net loss of $6.7 million, or 17 cents a share.)
Active Power shares, which ended Friday at $18.47, are down 65% from their
first-day close of $52.75 but are still above their August 2000 offering
price of $17.
Active Power is on the verge of announcing the distributor of its next
commercial product, the HIT6, a more advanced power-supply product aimed at
telecoms that?s being field-tested in 2001 with commercial rollout slated for
2002. Upbeat news about another commercial product could do some nice things
to Active Power?s stock - in the short run, at least. And that?s the essence
of alternative-energy investing: lots of promise, little profit and stunning
share price volatility based mostly on the news. But while we?re still a long
way from a fuel cell in every proverbial pot, we?re a lot closer than we used
to be. And the California crisis is only heating up the race to find new
power sources. After weighing the risks, which are substantial, the key
question for investors is, are these technologies of tomorrow worth putting
money into today? If you decide that they are, be sure to plunk down your
money after a big sell-off. There?ll probably be plenty to choose from.
For more information and analysis of companies and mutual funds, visit
SmartMoney.com at http://www.smartmoney.com.

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

Much Calif Power Price Gouging Beyond FERC's Reach -ISO
By Jason Leopold
Of DOW JONES NEWSWIRES

06/25/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

LOS ANGELES -(Dow Jones)- Federal energy regulators only have the authority
to order refunds for about a third of the $9 billion California Gov. Gray
Davis claims energy companies have overcharged the state in the 12 months to
May 2001, documents from the state's wholesale market operator show.
Of the total, $2.9 billion came from the May-September period the Federal
Energy Regulatory Commission has said it can't act on, and $2.8 billion from
the October-May period is attributable to municipal utilities over which FERC
lacks jurisdiction, according to documents from the California Independent
System Operator.
That leaves just $3.3 billion in alleged overcharges that FERC could
potentially order refunded - far less than the $9 billion Davis seeks.
Talks between generators and state officials to settle billions of dollars in
unpaid bills and issues of overcharging began Monday. Curtis Wagner, the FERC
administrative law judge presiding over the talks, has said California will
likely see refunds from generators, but far less than the $9 billion Davis
expects.
Davis said Sunday California is going to Washington, D.C., "with one goal,
and that is to bring back $9 billion."
Nearly half that amount is attributable to municipal utilities, the ISO
documents show. The ISO said the Los Angeles Department of Water and Power,
for example, overcharged California $75 million between May and October.
David Freeman, the governor's chief energy adviser and the former general
manager of the LADWP, said the agency didn't overcharge the state, but
conceded it profited by selling spare power to the ISO.
Davis adviser Nancy McFadden said the state needs FERC to lay the groundwork
for the state to seek refunds from public utilities by ordering refunds from
corporate energy suppliers.
But during a conference call Sunday with reporters, McFadden and Davis press
secretary Steve Maviglio couldn't explain how the governor would go about
getting refunds from companies whose wholesale power prices aren't regulated
by FERC.
Davis testified before the U.S. Congress last week that generators
overcharged the state $9 billion and that FERC should order the refunds.
State Sen. Jim Brulte, R-Rancho Cucamonga, has asked for an investigation
into Davis's testimony, saying the figures were based on "shaky
calculations."
To come up with its conclusions, the ISO compared hourly market prices
received by sellers to an estimate of market prices that could have been
expected under competitive market conditions.
The ISO established a benchmark for what it determined was competitive - at
times about $125 per megawatt-hour to $200/MWh, a fraction of actual prices
in the market - based on the cost of natural gas and compliance with
air-quality rules.
The ISO, however, typically used the price of gas at California's northern
border, according to the documents. Generators paid a higher price for the
fuel in Southern California, raising the cost of making electricity.
The ISO also used reports of earnings by the state's "Big Five" power
suppliers during 2000 - earnings that for some quadrupled - to draw the
conclusion that generators overcharged the state, according to the documents.
The ISO attributed high power prices in part to the state's three largest
utilities' failure to buy the power they needed in advance, leaving the grid
operator to pick up the shortfall at the last minute, according to the
documents.
The ISO alleges the following companies overcharged the state by the listed
amounts between May 2000 and February: American Electric Power Service Corp.
(AEP): $22.9 million
Arizona Public Service Co. (PNW): $24.6 million
Aquila Power Corp. (ILA): $28 million
Avista Energy Inc. (AVA): $48 million
Automated Power Exchange: $16 million
British Columbia Power Exchange Corp: $439 million
Calpine Corp. (CPN): $236 million
Constellation Power Source Inc. (CEG): $7.8 million
Cargill-Alliant LLC: $1.4 million
Citizens Power Sales: $557,000
Coral Power, LLC,. a unit of Shell Oil (RD): $27 million
Duke Energy Corp. (DUK): $804 million
Dynegy Inc. (DYN): $530 million
Enron Corp. (ENE): $39 million
El Paso Corp. (EPG): $29 million
El Paso Power Electric Co. (EE): $24,475
Hafslund Energy Trading LLC: $712,528
Idaho Power (IDA): $28 million
Koch Energy Trading: $2.5 million
Los Angeles Department of Water and Power: $75 million
MDSC: $24 million
Mieco Inc.:$1.6 million
Morgan Stanley Capital Group (MWD): $124,644
NewEnergy Inc.: $1.5 million
Nevada Power Co. (SRP): $9.1 million
PacifiCorp: $65 million
PECO Energy Co. (EXC): $4.2 million
Portland General Electric (ENE): $44 million
Public Service Co. of Colorado: $14.1 million
Public Service Co. of New Mexico (PNM): $15.5 million
Puget Sound Energy: $24 million
Reliant Energy Inc. (REI) $750 million
Mirant Corp. (MIR), formerly Southern Co., $753 million
*Sempra Energy Trading Corp. (SRE): $82 million (this number has been
wiped out by the ISO)
Sierra Pacific Power Co. (SRP): $23 million
TEK: $11 million
Tuscon Electric Power: $1.1 million
UPA: $131,715
Winston and Strawn: $11,917
Williams Cos. (WMB) $860 million

Total FERC jurisdictional sellers: $4.7 billion
*Total without SETC/SDG&E: $4.6 billion

Total FERC and Non-FERC sellers: $6.7 billion
*Total without SETC/SDG&E: $6.6 billiion

Total March-May overcharges: $2.3 billion

-By Jason Leopold, Dow Jones Newswires; 323-658-3874;
jason.leopold@dowjones.com

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

Oregon House May Vote Monday On Electricity Deregulation

06/25/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

LOS ANGELES -(Dow Jones)- Oregon's House of Representatives may vote Monday
on delaying electricity deregulation for large businesses until March 1,
2002, a spokesman for the Oregon Public Utilities Commission, or OPUC said.
Under the partial-deregulation bill, large business customers of Enron
Corp.'s (ENE) Portland General Electric Co. unit and Scottish Power's (SPI)
PacifiCorp (X.PCP) unit could buy power from competing electricity suppliers,
or opt to retain regulated rates until July 2003, said OPUC spokesman Bob
Valdez.
Residential and small-business customers would continue to have regulated
rates.
If the restructuring bill passes, the OPUC would determine by late July which
customers qualify as "large businesses", Valdez said. He added that he
couldn't speculate on what percentage of the state's total electricity load
might fall under partial deregulation.
The bill, which passed the Senate on Friday and is scheduled for a vote in
the House Monday, delays large customer choice from its original Oct. 1 start
date.
The revised date ensures the state will get through the winter, when demand
is highest, without the possibility of glitches caused by the new system,
Valdez said.
The new date also ensures customers won't mistakenly attribute a rate
increase, also planned for Oct. 1, with the start of deregulation. The rate
hike is necessary because the Bonneville Power Administration, a federal
hydropower marketer which sells to the state's utilities, must buy some power
next year in the high-priced spot market to meet burgeoning customer demand.
The rate hike will reflect the extra costs.
"Delaying the start of restructuring until March provides a separation in
people's minds from the rate hike this fall. It's political," Valdez said.
Monday's vote on the Republican-sponsored bill also may be delayed, however.
Democrats walked off the House floor late Monday morning, because they were
upset about a separate bill on redistricting, Valdez said.
"At most, the delay will last a day or so. At some point, the House Speaker
will get tired of it and just force them back on to the floor," Valdez said.
Republicans have a six-vote majority in the House, but support for the
restructuring bill doesn't really fall along party lines, he said.
-By Jessica Berthold, Dow Jones Newswires; 323-658-3872;
jessica.berthold@dowjones.com

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

USA: Fresh look at wind energy blows to US from Europe.
By Jonathan Landreth

06/25/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW YORK, June 25 (Reuters) - Windpower is poised for a relaunch in the
United States, where regulators, investors and utilities, following Europe's
lead, are tilting toward improved technology that now makes windpower
cost-effective, experts say.
Long-tainted by failures that burned early U.S. backers and by critics who
saw windmills as an eyesore and as a danger to birds, windpower still only
provides the United States with less than 1 percent of its energy.
"But now there is a perceived shortage of power that wasn't there 5 to 10
years ago," said Maurice Miller, an independent renewable energy consultant
in California, where a bungled attempt at deregulation and a host of other
factors has made rolling electricity blackouts part of life in the state.
"Wind energy companies are now perceived as viable, competitive businesses,"
said Miller, who, as former chief financial officer of U.S. Windpower, the
wind industry's most notorious failure would know.
Nowadays, windpower is a viable business by nearly any standard, and is
growing at 25 percent a year worldwide.
Led by Denmark, which gets 10 percent of its electricity from wind, and by
widespread wind development in Germany and Spain, well-placed windfarms in
spots such as the American plains states are estimated to be capable of
producing three times the total electricity now generated in the entire
nation.
Wind turbine technology, vastly improved in recent years, is ideal for
flatlands where hot air rises - off the plains of the Dakotas, Kansas and
Texas, for instance - and where cool winds are drawn off bodies of water such
as the Great Lakes, the Gulf of Mexico or the Pacific Ocean off California's
coast.
SLOW TO SHIFT
But Merrill Lynch analyst Steven Fleishman said wind is still a "minute
factor" for the two biggest players in the U.S. windpower market, giant
utility Florida Power and Light , and Enron Corp. , the largest U.S. maker of
wind turbines.
Still, spurred by prices that make windpower as affordable as natural gas or
coal as well as by tax subsidies for developers and government mandates
requiring utilities to buy more power from renewable energy sources, both
companies are now involved in big windpower projects.
And now a handful of other U.S. fund managers say wind has huge potential to
make money. So much so, that Jack Robinson's Winslow Green Growth and Green
Century Balanced mutual funds have twice the weighting in renewable energy
companies as the S&P 500 index .
"Wind is at an inflection point where it doesn't need subsidies to be
competitive with traditional power sources," Robinson said.
THE COST OF WIND
While governor of Texas, President George W. Bush signed a law mandating
utilities to buy more power from alternative energy sources. Texas now has
the fourth largest installed windpower capacity in the United States, and can
deliver wind power at a competitive 5 cents per megawatt hour.
But Robert Beningson, chief executive of York Research Corp., an alternative
energy developer based in New York City, said wind only achieves such
competitive prices with the crutch of tax subsidies for developers.
What the U.S. wind industry needs now to catch up with Europe's wind power
craze, Beningson said, is an extension of the Production Tax Credit (PTC), a
move mentioned but not mandated in the Bush administration's new proposed
energy policy.
Lyn Harrison, editor of industry magazine Windpower Monthly agrees.
"Wind is Bush's chance to marry his big business stance and the environmental
messages in his proposed energy plan," said Harrison, whose magazine has
offices in wind-rich Denmark and California.
Long term forecasts in the early 1990s by Pacific Gas & Electric and the
Electric Power Research Institute (EPRI) said wind would ultimately become
the least expensive electricity source.
Current data shows those forecasts are no longer pipe dreams. Based on its
knowledge of current market conditions, the Washington, D.C.-based American
Wind Energy Association (AWEA) estimates that the cost of tax-subsidzed wind
energy at good sites ranges from 3 cents to 6 cents per kilowatt-hour (kWh).
Without the tax subsidies, or PTCs, wind generated electricity still sells at
a low cost between 4 cents and 6 cents per kWh, comparable with the 4.8 cent
to 5.5 cent per kWh cost of coal and the 3.9 cent to 4.4 cent per kWh cost of
gas.
WIND'S TROUBLED PAST
But experts note that wind still suffers from its early bad reputation with
U.S. investors.
Since its inception in the United States the late 1970s, the American wind
power industry faced an uphill battle against bigger and more established oil
and gas companies.
In September 1993, a California company called U.S. Windpower, then the only
U.S. maker of wind turbines, raised $90 million in an initial public offering
underwritten by Merrill Lynch, hoping to use the money to improve its turbine
technology.
By May 1996, U.S. Windpower filed for bankruptcy after a series of mechanical
failures proved windpower too expensive.
"There isn't a major institutional investor who wasn't burned by U.S.
Windpower," said Jan Paulin, chief executive of Sea West, a private wind
developer based in San Diego. "Their efforts were noble but they
miscalculated."
Because wind development's cost reflects the time and money needed for making
better equipment, scouting the windiest sties, and getting permits to build
wind farms, the economics of the wind turbine business are highly sensitive
to the interest rate banks charge developers, experts say.
"It's a shame that U.S. institutional investors have such an outdated view of
the industry and the technology," Paulin said. "To this day, most of the U.S.
wind power developments were initially funded by European banks."
Also, governmental commitment to windpower in Europe helped jump-start the
industry before it became self sufficient.
WINDPOWER IN EUROPE
If wind farms were financed on the same terms as natural gas plants, their
cost would drop by nearly 40 percent, according to an AWEA study.
Technological improvements that enable turbines to generate steady streams of
power no matter what the wind's speed means that it is just a matter of time
before U.S. investors, like Europeans, head straight into the wind business,
fund manager Robinson said.
"American investors will come to wind, but they may not be investing in U.S.
companies at this point in time as there are very few pure plays," said
Robinson, whose funds hold the shares of Denmark's two biggest publicly
listed wind turbine makers, Vestas Wind Systems , the largest wind turbine
maker in the world, and NEG Micron , the No. 4 wind turbine company in the
world.
Shares of Vestas and NEG Micron - both part of the Copenhagen Bourse's top-20
index, KFX - soared on May 1 after a Danish government researcher forecast
that wind turbines would supply 10 percent of the world's electricity in 20
years.
Soon after, Merrill Lynch started coverage of Vestas with a "neutral" rating
in the intermediate term and a "buy" rating in the long term, citing a belief
that the wind power companies were on course for a sustained period of strong
growth.
Denmark already gets 10 percent of its power from wind, and Vestas and NEG
Micron share prices have doubled in a year.
Vestas also holds a 40 percent stake in world's No. 2 wind turbine maker,
Gamesa Eolica, which is part of Spain's Gamesa Group .

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

USA: UPDATE 3-Some $15 billion at stake in US power refund talks.
By Patrick Connole

06/25/2001
Reuters English News Service
(C) Reuters Limited 2001.

WASHINGTON, June 25 (Reuters) - California and other Western states angered
by alleged bilking by power generators on Monday sought to convince the U.S.
Federal Energy Regulatory Commission's chief law judge to refund them some
$15 billion for wholesale power purchases made during the past year.
The settlement talks, involving dozens of companies and state officials from
California and the Western region, were to continue for the next two weeks.
California alone believes it was bilked out of more than $9 billion by
electricity generators during an unrelentingly expensive power price spike in
its partially deregulated wholesale market.
"We are not going to ask FERC for $9 billion. We're going to ask for a lot
more than that for our litigating position," Michael Kahn, chairman of the
California Independent System Operator, told reporters outside the
closed-door settlement conference at FERC. The California ISO operates the
state's electricity transmission grid.
Judge Curtis Wagner, who convened the talks in a packed hearing room at FERC
headquarters, said parties must reach a deal "now" or face the prospects of a
FERC-ordered plan.
"I can tell you now that you are far better off to work out the refund issue
in these settlement proceedings," he told lawyers representing some 60-odd
parties before the conference went into closed session.
"The time to put California's past energy problems to rest and structure a
new arrangement for California's energy future is now. We can do it if we
try. I have the utmost faith in you," Wagner said.
CLAIMS, COUNTER CLAIMS
While California claims it was overcharged by electricity generators who
deliberately pushed prices higher, many of the out-of-state generators claim
they have not yet been paid for some transactions.
The generators - including Enron Corp. , Duke Energy Corp. and Williams Cos.
- have denied wrongdoing.
A representative from energy generator and marketer Reliant Energy Inc.
attending the settlement conference said he was concerned the California
Independent System Operator's method of calculating its $9 billion sales
overcharge figure is based on "black box" methodology.
"Those are mystical calculations," said John Stout of Reliant. "From what we
can gather they don't cover all our costs."
The ISO's cost calculations do not account for operation and maintenance fees
of generating facilities, Stout said.
"That doesn't seem quite fair," he said.
In his statement opening the conference, Wagner acknowledged the enormous
sums at issue.
"This issue includes the enormous number of dollars in wholesale power that
have been purchased for PG&E Corp., SoCal Edison and (the state) Department
of Water Resources, for which the generators have not been paid," Wagner
said.
"On the other hand, the state of California alleges that its distribution
companies and the DWR have been overcharged $9 billion. The amounts involved
must be, both ways, resolved at the outset to put everyone on the same
playing field."
While the state's power grid operator has vowed to press for more money,
California Gov. Gray Davis has said the state is owed roughly $9 billion
dollars for overcharges.
In April, the state's largest utility Pacific Gas and Electric Co., a unit of
PG&E Corp. , voluntarily filed for protection from creditors due to the
state's electricity crisis. Southern California Edison (SoCal), a unit of
Edison International , is trying to avoid the same fate.
Wagner said if the talks were not successful by July 9, he would make a
recommendation on refunds and non-payment issues to FERC's five
commissioners.
FERC previously ordered about $124 million in refunds for overcharges during
January and February.
Last week, FERC expanded a "price mitigation" plan to all 11 Western states
to curb runaway wholesale prices. The plan fell short of the strict price
caps sought by California officials and some Democrats, but has been praised
as a good first step in stabilizing wholesale prices.
California state officials were to meet later on Monday with Wagner to help
set an agenda for the settlement talks, Kahn told reporters outside the
settlement conference.
The settlement conference was open to the public for the first hour before
being closed for companies to discuss confidential business information.
JUDGE LISTS ISSUES
Wagner said in addition to the refunds and payment issues, there were six
other matters that must be considered and agreed on by the numerous parties.
They included the question of how much additional power generation for sale
should be moved from the spot market to longer-term contracts.
"This includes both current and future long-term contracts and the length of
such," Wagner said.
Other matters listed by the judge were:
- Resolution of the credit worthiness of power buyers;
- The independence of the California Independent System Operator board,
possibly including a reorganization of the state grid operator;
- Issues concerning intrastate and interstate natural gas transportation and
the constraints in southern California;
- Question of whether the settlement should offer immunity from existing and
future lawsuits and prosecutions against the generators;
- The issue of the Pacific Gas & Electric bankruptcy.
(Additional reporting by Chris Baltimore).

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

USA: FPL starts wind farm to power 10,500 Wisc. homes.

06/25/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW YORK, June 25 (Reuters) - FPL Energy, LLC, a unit of FPL Group Inc. ,
said Monday it began operations at the largest wind-generating power plant in
Wisconsin, the 30-megawatt (MW) Montfort Wind Farm located west of Madison in
Iowa County.
The plant will generate enough electricity to power 10,500 Wisconsin homes,
FPL said in a statement.
Electricity generated at the facility, in the town of Eden, Wisc., is being
sold under multi-year contracts to Wisconsin Electric-Wisconsin Gas, a unit
of Wisconsin Energy Corp. , and Alliant Energy-Wisconsin Power and Light ,
FPL said.
The facility consists of 20 1.5-MW Enron wind turbines atop 215-foot towers
outfitted with 110-foot blades.
Wind trade associations have said that wind power will account for more than
18,000 MW of capacity worldwide before the end of 2001.
Wind power and other renewable energy sources like solar and geothermal have
been spotlighted in recent months as clean alternatives to burning more
fossil fuels to meet rapidly rising electricity demand.
FPL Energy is the largest generator of wind power in the U.S. with more than
1,000 MW of capacity in Iowa, Texas, Minnesota, Wisconsin, Oregon and
California.
FPL has a net ownership of approximately 600 MW.
The company also has four wind projects under construction that will add
nearly 850 MW to its portfolio by the end of 2001.
FPL Group's principal subsidiary is Florida Power & Light Co., which serves
more than 7 million people in Florida.
- New York Power Desk, 646 223-6074, fax 646 223-6079, e-mail
Eileen.Moustakis@reuters.com.

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

USA: Calif says power refund demand will top $9 billion.

06/25/2001
Reuters English News Service
(C) Reuters Limited 2001.

WASHINGTON, June 25 (Reuters) - A California official said Monday the state
will seek "a lot more" than $9 billion in negotiations with generators for
alleged wholesale electricity overcharges during the past year.
Michael Kahn, chairman of the California Independent System Operator, the
entity that runs the state's power grid, told reporters that overcharge
claims would run much higher than the $8.9 billion previously estimated.
"We are not going to ask FERC (Federal Energy Regulatory Commission) for $9
billion. We're going to ask for a lot more than that for our litigating
position," Kahn told reporters outside a closed-door settlement conference at
FERC. The conference led by FERC Administrative Law Judge Curtis Wagner began
earlier on Monday in an attempt to reach a settlement.
Kahn also said that the $8.9 billion overcharge figure previously cited by
California Governor Gray Davis was "extremely conservative but one that the
ISO is confident in." State officials would meet later in the day with Judge
Wagner to help set an agenda for the settlement talks, he said.
While California claims it was overcharged by electricity generators who
deliberately pushed prices higher, many of the out-of-state generators claim
they have not yet been paid for some transactions. The generators - which
include Enron Corp. , Duke Energy Corp. , Reliant Energy Inc. and Williams
Cos. - have denied any wrongdoing.

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


Attached is a new draft of the letter to John Pope with all comments
received.  Dick Ingersoll will send this out to TVA tomorrow.  If you have
any other additions, please get them to me today.


2 primary contributing factors:

1) EOL transaction volume increase
2) CES acquisition

Paula Harris
10/09/2000 03:41 PM
To: Scott Neal/HOU/ECT@ECT
cc:
Subject: East Gas Volume Confirmation

Scott,

As you are already aware, we have to provide volume (settled sales only)
explanations to Investor Relations each month.  Given that it's a quarter end
month, it is even more important that we receive good explanations which
sufficiently support your trading business.  The format includes a year to
year comparison, quarter to quarter comparison as well as a month to month
comparison for any increases/decreases greater than 10%.  Your stats are as
follows:

EAST GAS TRADING (Bbtu/Day - Settled Sales Only)

Year to Year
September 2000 7,258
September 1999 3,179
Increase  128%

Quarter to Quarter
3Q 2000  7,282
3Q 1999  2,910
Increase  150%

If you could send me an explanation explaining what's driving your increase
by tomorrow morning, that would be great.

Thanks, Paula


Attached please find the referenced list.  Remember, no credit derivatives
are approved for any counterparites unless Credit has indicated they are a
credit derivative counterparty on the list.


hello kay, got your e-mail.  i haven't made a list yet.  i was in bay city all day today, came home with a bad-#@# head-ache, back ache, have had dirreah all day,  then i come home to find out i have to be in the dentist tomorrow for at least 2 more hours. they have to grind my teeth down some more.  she told me her lab was picky. they called her and told her that she needed to grind some more because they want a perfect look and needed more room to make them look like the wax model they did. oh yeah the rest of the crap above is all a bad pms symptom,  i started spotting tonite so the next three days or gona be a doosy.  well i'll get back tomorrow ok.                love ya, bev


Kevin

I'm contacting you in the hope that you may be able to provide us with some info regarding British Energy.  I'm a trader on the UK Power Desk where BE are one of our major counterparties.  We are currently assessing what their strategy is likely to be in the UK and this depends in part on how profitable their US/Canadian assets are.  Do you have any insights on what they are up to in these markets right now - i.e how much of their output do you believe they have hedged forward and at what price ?  If BE succeed in restarting another 1600MW at Bruce is this likely to depress the market price there ? In general what do we believe the outlook to be for the US and Canadian markets.

Any info would be much appreciated !

Should you need to speak to me my phone number is +0044 207 783 6919

Many thanks
Derek


All,

Attached is the latest version of the captioned Schedule (10/25/99).


We can not agree to even present to senior management the increase in advance rate to 50% from 30% on the utility billed AR.   The changes in the Eligible Accounts language has to do with the aggregation of the NewPower AR from it's customers, which the utility purchases.   Thus the many customer receivables are replaced by one large utility receivable.   I would appreciate legal comments with this and elsewhere.

As I had send in my e-mail message to Todd Hermanson last Saturday, and repeated again on the telephone on Wednesday, these terms have not been approved in accordance with Enron Corp's Transaction Approval Process.   Any communication should clearly state this.

-----Original Message-----
From: Marc.Manly@NewPower.com [mailto:Marc.Manly@NewPower.com]
Sent: Friday, October 12, 2001 6:07 PM
To: Eickenroht, Robert; Mellencamp, Lisa
Cc: david.burns@bakerbotts.com; Tribolet, Michael; Bradford, William S.;
Nettelton, Marcus; elizabeth.guffy@bakerbotts.com;
joseph.cialone@bakerbotts.com; wesley.shields@bakerbotts.com
Subject: Amendment to Master Credit Agreement

Lisa and Robert:

I attach a revised (new draft from NewPower) version of the Amendment and
General Security Agreement, together with a blacklined version of this
redraft against the last document we received from you.  Our changes, which
we have not had the opportunity to discuss directly with you, include the
following:  a revision of the security interest from a general lien to a
lien on all receivables and inventory only, and an increase in the October
cap from $20 to $25 million (which I understand were agreed between Cronin
and Tribolet); a revision in the definition of Eligible Accounts to reflect
receivables purchase arrangements with certain utilities (which I
understand was agreed between Hermanson and Tribolet); a proposed revision
in the advance factor for utility billed receivables from 30% to 50% (which
has not been agreed but is our proposed fix to give us comfort that the
Eligible Accounts get us up to the $25 million and $40 million limits) and
certain other changes to correct typos or to clarify certain points as to
which I believe we are in agreement.  Notably, this draft contains no
provisions that would protect NewPower against the risk of losing surety
collateral, or the risk of commodity price declines that would require the
posting of additional collateral.  As to the latter risk, my clients and
yours have been exploring swaps and other arrangements that we may employ
to mitigate that risk.

I also attach copies of proposed resolutions for the Business Review
Committee and the Board of Directors in connection with these documents.

On the assumption that these documents are acceptable, we have scheduled a
meeting of the Business Review Committee for this upcoming Tuesday
afternoon (we could not get a quorum any time today or Monday) and assuming
a positive recommendation by  the BRC, immediately thereafter we would
schedule a telephone Board Meeting for all necessary approvals, at which
point the documents could be executed and an 8-K disclosure filed.

                                              Marc E. Manly

(See attached file: 2ndamend-NPW-101201-clean.doc)(See attached file:
2ndamend-NPW-101201-blk.doc)(See attached file:
secagmt-NPW-101201-clean.doc)(See attached file:
secagmt-NPW-101201-blk.doc)(See attached file: BRC Report.doc)(See attached
file: BRC resolutions.doc)


fyi...
---------------------- Forwarded by Karen Denne/Corp/Enron on 05/11/2001
02:36 PM ---------------------------

Karen Denne
05/11/2001 02:16 PM
To: Kenneth Lay/Corp/Enron@ENRON
cc: Rosalee Fleming/Corp/Enron@ENRON, Jeff Dasovich/NA/Enron@Enron (bcc:
Karen Denne/Corp/Enron)

Subject: Information for Call to LA Mayor Dick Riordan

Ken -- Thank you for making next Thursday, May 17 available for CEO meetings
in California.  We are working to set up two meetings -- one in Los Angeles
and one in Silicon Valley (we'll call on Scott McNealy's contact person to
help pull the Northern California meeting together).   For the Los Angeles
meeting, we'd like you to call Mayor Dick Riordan (213-847-3456) and ask for
his help in pulling together a group of key, influential business leaders.
As background, Riordan is a very wealthy Republican businessman who has been
term-limited out and has not yet made public his future political aspirations
(a bid for governor has been mentioned by insiders).

You might congratulate him on helping to settle the Writer's Guild strike and
ask if he'd now like to resolve the energy crisis (He's in a bit of a spat
with Dave Freeman over who can claim credit for LADWP's success during this
energy situation -- see attached LA Times article).  You can say you've been
told that he was one of the clearer heads during the deregulation process and
were instrumental in keeping DWP out of the regulatory mess.

This is an opportunity for Riordan to help broker a solution, and that's why
you're calling him.  You met with Robert Day (Trust Co of the West) who
suggested that you call Riordan and enlist his support.

Explain about our comprehensive solution -- business support is critical to
garner political support.

You'll be in Los Angeles next Thursday.  Ask if he could invite and host a
meeting of key business leaders and introduce you.  I've attached a suggested
list of prominent businessmen, close associates and personal friends of
Riordan's.  We'd like to position this meeting as an insider's conversation
of what's going on with the energy situation.  This meeting should be for
principals only.

Ask Riordan to identify someone in his office who we can work with to set up
the meeting.  Enron's consultant in LA (Marathon Communications) will work to
coordinate the event.

If Riordan is not available next Thursday, ask him if he would ask Eli Broad
(chairman of Sun America and a Democratic billionaire) or Jerry Perenchio
(chairman of Univision) to host the meeting.

Proposed Invitees

*Eli Broad - Chairman, Sun America
*Ron Burkle - Yucaipa Companies
Jeffrey Katzenberg - DreamWorks
Sherry Lansing- Paramount
Nelson Rising- Catellus
Bob Daly - LA Dodgers
Ray Irani - Occidental Petroleum
*Jerry Perenchio - Univison
Michael Eisner/Bob Iger - Disney
Ed Roski - Majestic Realty
Earvin Johnson/Ken Lombard - Johnson Development Corporation
Bruce Karatz - Kaufmann & Broad
Terry Semel - Yahoo!
Gary Winnick - Global Crossing
Henry Yuen - Gemstar
*Carl McKinsey
*Liam McGee - Bank of America
*Barry Munitz - Getty Trust
*Gordon Binder - Amgen (ret)
David Baltimore - Cal Tech
Danny Villanueva - Bastion Capital
Phil Anschutz - Qwest Communications, Staples Center
*Dennis Tito - civilian spaceman (former LADWP Commissioner)
Kent Kresa - Northrop Grumann

Sunday, May 6, 2001
Riordan and Freeman's Feud Erupts in Public
Power: Each questions the other's role in keeping the city free of
California's energy crisis.
By MICHAEL FINNEGAN, TERENCE MONMANEY, Times Staff Writers

?????With California mired in energy troubles, Mayor Richard Riordan and his
former power chief S. David Freeman trumpet the extraordinary fortune of Los
Angeles: no rate hikes and no blackouts.
?????Yet Riordan and Freeman have sullied their mutual success story by
waging bitter campaigns to discredit each other--at first behind the scenes
but now in public.
?????Pettiness, ingratitude, conflicts of interest, overblown claims of
achievement: Such is the back and forth between two leaders who would seem to
have good reason to pat each other on the back.
?????To Freeman, who has resigned as general manager of the L.A. Department
of Water and Power to become chief energy advisor to Gov. Gray Davis, it
seems Riordan resents his high-profile role in trying to steer California out
of the energy crisis.
?????So the mayor, Freeman charged, has elbowed his way into energy issues
that he is ill-equipped to handle and taken steps along the way that could
harm the environment.
?????"With all due respect, I have 25 years of experience and knowledge--and
he has 25 days," Freeman said. "But he's the mayor, and he didn't like it
that I didn't just say yes to everything he came up with."
?????To Riordan, Freeman's efforts to fight air pollution have given short
shrift to the threat of skyrocketing power rates in Los Angeles. The mayor
said Freeman also failed to recognize potential conflicts of interest between
his city and state roles in the power crisis. And he scoffed at Freeman for
saying he had lifted morale at DWP.
?????"Morale was terrible under him," Riordan said. "I mean, they are so
relieved right now."
?????The backbiting has left associates suspecting the clash is really about
egos. City Councilwoman Ruth Galanter sees Riordan and Freeman as proud,
successful men unable to say, "I couldn't have done it without X, Y and Z."
?????"Each of them is used to being the boss and taking pleasure at being
recognized as the boss," she said.
?????Much of the conflict has taken place in private meetings. And the mayor,
a Republican multimillionaire, has taken pains to play down his dispute with
Freeman, a liberal Democrat from Tennessee who wears a cowboy hat and speaks
with a Southern drawl.
?????In an interview after his resignation, Freeman laid out the conflict
point by point, often in terms bluntly critical of the mayor. One of his
concerns, Freeman said, was that Riordan in his final two months as mayor
could reverse the agency's progress in protecting the environment.
?????Freeman cited Riordan's plans concerning coal-fired power plants in
Nevada and Utah that are partly controlled by the DWP, the nation's largest
municipal utility. The first is the Mohave Generating Station in Laughlin,
Nev., a plant that has been blamed for spreading some of the haze that
shrouds the Grand Canyon. The DWP had planned to sell its stake in the plant,
but Freeman said Riordan ordered him to back out of the sale.
?????He described the mayor's move as a sign that Riordan and his appointees
on the board that oversees DWP were "completely insensitive to the fact that
that power plant is one of the most environmentally troubling plants in the
West."
?????"I've worked real hard to try to build some environmental sensitivity
into the DWP policy," Freeman said. "And I am concerned as to whether the
current commissioners and the mayor have that sensitivity, and what they
might do in the interim to basically overturn the progress we've made."
?????The other plant is part of the Intermountain Power Project in central
Utah. Riordan has proposed building a new coal-fired generating unit there,
but Freeman said he objected because of the pollution it would cause.
?????In both cases, Riordan said he was striking the appropriate balance
between protecting the environment and meeting the energy needs of Los
Angeles at an affordable cost. By keeping its share of the Mohave plant and
expanding the Utah plant, Los Angeles can avert the astronomical price hikes
of natural gas--and the sharp rise in ratepayers' bills that would follow,
Riordan said.
?????Natural gas, which provides 26% of the fuel for DWP plants, causes less
air pollution than coal, which provides 51%. The rest is mainly nuclear and
hydroelectric. Los Angeles has averted rate hikes and blackouts in part
because the DWP relies less on natural gas than most other California power
providers.
?????"I favor clean air and more natural gas, but not to the point where
we're going to destroy the economy of Los Angeles," Riordan said.
?????On the Mohave plant, Riordan questioned the benefit of selling the
city's share to a buyer that would simply continue running it.
?????"It's still going to be coal-driven," he said. "How does selling it help
the environment?"
?????The tension between the two has built steadily as the state power crisis
has worsened. With the charismatic DWP chief drawing favorable news coverage
in stories on how L.A. has dodged the crisis, Riordan and the DWP
commissioners began to view him as "too big for my britches," Freeman said.
?????The conflict reached its peak on April 17, the day Freeman resigned to
become the governor's advisor. The DWP board president, Kenneth T. Lombard,
said the mayor told commissioners that day that "it made the most sense to
release him immediately."
?????"All we were doing, frankly, was release him from his responsibilities,
and then whatever time he needed to clean out his office was fine with us,"
Lombard said.
?????From Riordan's standpoint, Freeman needed to be stripped of his
authority right away because of a potential conflict of interest: The city
utility sells surplus power to the state, so Freeman would be on both sides
of the sales.
?????Freeman, who had voluntarily bowed out of a DWP meeting on the state
power crisis earlier that day, was outraged at his sudden release, in part
because he was denied the chance to say goodbye to agency employees. In an
interview, he called the conflict of interest assertion "complete malarkey."
?????"The insinuation that I have done anything less than protect the
interests of the city of Los Angeles is bordering on slanderous, considering
what I've accomplished here," he said.
?????Brian D'Arcy, who heads the union local that represents 6,000 DWP
employees, agreed that Riordan and his commissioners "kind of ran him out of
here. For David to be summarily jettisoned out of here without even a
howdy-do is absolutely tacky," D'Arcy said.
?????Riordan said Freeman deserves "an A-plus" for his work at DWP. The mayor
conceded that he knew of nothing that Freeman had done "to hurt Los Angeles."
But, he added, "when you have a conflict of interest, you have to act before
anything happens."
?????Freeman has long bridled at the oversight of DWP, not just by the mayor,
but by the agency's board and the City Council. In 1998, he called for City
Charter amendments to consolidate authority in a more independent board of
directors. The proposal went nowhere.
?????Freeman's concerns were echoed in a report to be released Monday. The
Rand Enterprise Analysis report was commissioned by the DWP. It calls for
restructuring DWP management much the way Freeman proposed. But Riordan and
Galanter, who chairs the Council's Commerce, Energy and Natural Resources
Committee, rejected the concept. Copyright 2001 Los Angeles Times


Thanks, Lamar.  The ARM coalition's attorney is drafting the comments, which should be ready for review later this morning.  The comments will deal exclusively with the rules governing the DA suspension and won't address the contracts issue--comments on Carl Wood's demand to see the contracts will come later in the week, or first thing next week.

With respect to the positions in the comments, it's a composite of the positions of many ESPs and their customers.  Appears that some ESPs in the ARM group may want to assign customers to another ESP, which is why those comments are there.  Also, some customers want to be classified as DA in perpetuity, irrespective of their contract terms--which is why renewal, or the ability to change to another ESP, will get a lot of play.  And as you know, UC is being very aggressive in our planning meetings about facility-adds.

We could file separately, but the combined push for 1) establishing liberal suspension rules and 2) keeping contracts out of the Commission's hands will come from other folks and is likely to be pretty strong.  Not sure that separate comments would get us any additional value.  Let us know what you think.

In addition, Carl Wood isn't very interested in balancing suspension rules with the need to review contracts.  He's taking a "chain saw" approach.  He claims that he wants to see the contracts in order to determine whether he can re-set the suspension date retroactive to July 1, which the rest of the Commission currently does not seem to support.  In short, he appears hell-bent on trying to get his hands on people's contracts.  At this point the industry seems pretty solidly united in its opposition to giving them to him.

We're contacting the other Commissioners to determine whether Wood is out on his own on the contract issue--our sense at this point is that he may not have any support from other commissioners.  We'll let you know as soon as we find out.

I'll forward the draft ARM comments to you and Kevin later this AM.  If you have any other quesitons, let us know.

On the cost allocation issues, that's on a slightly slower track, but in the same forum.  Edison's position is the one they proposed to us in negotiations, which we rejected--1) all customers pay for Edison's undercollection (bundled and DA alike), 2) all customers pay for stranded DWR long-term contracts (bundled and DA alike).   The advice letters regarding implementation of the DA suspension don't offer any real detail on allocation and those issues will be hard-fought over during the first part of Q1.  That's the status thus far.  We'll know more on December 12th, when the Commission will hold another hearing on how it plans to address these issues over the next 60-90 days.

Best,
Jeff

-----Original Message-----
From: Frazier, Lamar
Sent: Mon 11/26/2001 7:59 PM
To: Dasovich, Jeff
Cc: Smith, Mike D.; Keeney, Kevin; Mara, Susan; Steffes, James D.; Blachman, Jeremy
Subject: Re: California Update--11.26.01

Jeff,

Thanks for the update.

Kevin and I are on point to provide input for Origination to the proposed Wednesday filing.  Please be sure to send drafts to Kevin and myself ahead of time.  I think we need to be careful to recognize that if on one hand we propose liberal rules for the administration of the Suspension of DA that we are careful not provide Com Wood for a reason/justification for requiring full disclosure of DA contracts (i.e. provisions for adding new facilities, roll-overs, etc.).  I am also somewhat cautious about proposing that ESP's have the right to assign contract amongst each other.  The logistical nightmares of perfecting that may not be worth our wild promoting to the CPUC.

Finally, and maybe I have some of this activity confused but the Utilities issued "Draft Advice Letters" regarding how they planned to implement the suspension of DA.  I believe it was in those Draft Letters that they (I know for sure that SCE did) provided a sneak preview of how it intended to allocate surcharges and settle negative CTC payment issues.  What is the status of that activity and how and when will Enron's position be submitted to the CPUC/Utilities?

Regards,

Lamar

From:   Jeff Dasovich/ENRON@enronXgate on 11/26/2001 07:19 PM

To:     David W Delainey/ENRON@enronxgate, Janet Dietrich/ENRON@enronxgate, Mike D Smith/ENRON@enronxgate, Vicki Sharp/HOU/EES@EES, Lamar Frazier/HOU/EES@EES, Kevin Keeney/HOU/EES@EES, Dan Leff/ENRON@enronxgate, Tim Belden/ENRON@enronXgate, Stephen Swain/ENRON@enronXgate, Alan Comnes/ENRON@enronXgate, Susan J Mara/ENRON@enronXgate, James D Steffes/ENRON@enronXgate, Richard Shapiro/ENRON@enronXgate, Jeremy Blachman/ENRON@enronxgate, Jeff Richter/ENRON@enronXgate, Christopher F Calger/ENRON@enronXgate, David Parquet/ENRON@enronXgate

cc:

Subject:        California Update--11.26.01

Rules governing suspension of DA and threats of retroactive suspension

??????? We have helped assemble a coalition of ESPs and business customers to get the most liberal rules possible (e.g., customers can renew DA contracts, customers can add facilities if contract permits, ESPs can assign contracts to other ESPs with consent of customer, ESP and customer can modify existing contract provisions.)

??????? The ESP coalition that we're a part of will file comments on Wednesday on how the suspension rules ought to work.

??????? Retroactively suspending DA remains on the table for debate and remains a threat. But support at the Commission for retroactivity has diminshed considerably and most think that the likelihood of retroactivity is low at this point.

??????? One Commissioner--Carl Wood--continues to express support for pushing the date back, however.

Ruling Issued by California Commissioner requiring market participants to submit their DA contracts to the Commission by first week of December for review.

??????? Commissioner Wood is openly and ideologically opposed to consumer choice and competition and continues his attempts to roll back choice.

??????? Wood issued a ruling "requiring" ESPs and customers to submit their contracts to the PUC for review to determine among other things whether the DA suspension date should be retroactively pushed back to some date prior to Sept 20.

??????? We are working with the same group of business customers and ESPs to oppose Wood's order.

??????? Today, the group agreed to the following:

1) Overall, customers and ESPs will not submit contracts to the California Commission (though there may be a small group that breaks ranks).

2) The group will jointly ask the full Commission to overturn Wood's ruling requiring submission of contracts on the grounds that the ruling is illegal. The group will likely file the joint appeal by the end of this week or first thing next week.

3) In addition, folks will submit separate comments on or around Dec. 3rd to the Commission regarding:

a) the legal reasons to support the argument that the commission doesn't have the legal authority to ask parties to turn over contracts, and,

b) the policy reasons to support the argument that the Commission doesn't need specific contracts, or contract language, to implement the suspension of DA effectively.

Edison's Proposal to Implement the Settlement It Reached with the PUC in Order to Avoid Bankruptcy.

??????? A local consumer group ("TURN") protested Edison's filing.

??????? TURN told the Commission that the proposal requires signficantly more time, scrutiny and analysis than Edison would allow under its proposed schedule.

??????? We're likely to support TURN's suggestion that considerably more time and scrutiny are required since Edison's proposal could have a significant effect on EES' book in California.

Will distribute additional information as it happens. If you have any questions, don't hesitate to contact us.

Best,

Jeff


Swing out with the Sparacino & Company Dancers, rousing performance of  SWING
KIDS! at the Miller Outdoor Theatre in Hermann Park.  Enron Night will be
Friday,  April 20 at 8:30pm and the performance is free of charge to the
public.   Although reservations are not required, you may secure a VIP seat
by calling 713.520.9070 or e-mailing dancer@neosoft.com.  The evening is
compliments of Sparacino & Company Dancers.

The Enron Volleyball Association will be sponsoring it's annual Spring Fever
Volleyball Tournament to be held at Third Coast Volleyball Club.  For the
first time, we will have a separate bracket for teams of four.  Food and
drinks will be provided and cash prizes will be awarded to the top three
teams from each bracket.  For more information, contact Traci Nguyen
(713.853.9032).

The Lone Star Boxer Rescue Golf Tournament will be held at Cypresswood Golf
Course on Wednesday, April 11 beginning with a Shotgun Start at 1pm.  All
proceeds for the tournament benefit the Lone Star Boxer Rescue group which is
an all volunteer organization who works to provide veterinary treatment and
find new, permanent homes for unwanted and abandoned Boxer dogs.

http://home.enron.com:84/messaging/registration.doc

http://home.enron.com:84/messaging/sponsorship.doc

Thanks to everyone who participated in our Birdies for Charity fundraiser in
the Enron Lobby last Tuesday, April 3rd.  Because of your generosity, we were
able to raise $500 for Junior Achievement.  This amount will be matched by
Enron, making our total donation $1,000.

The winners of the drawing were George Gilbert-the golf travel bag; Jim
Fussell-the Tiger Woods collector golf balls; and Charlie Vetters-the golf
shirt and hat.

Recycle Your Cell Phone!!!
Did you forget to bring in your discarded cell phones last week?  If so,
please send them to Gavin Dillingham at 3AC1526b by April 30th.  By bringing
your old phones, bag phones, batteries, adapters, charging units and other
cell phone related items, you will support Enron's effort to benefit the
Houston Chapter of CARE.

CARE is on the world's largest international relief and development
organizations with funds going directly to develop sustainable agricultural
and economic systems including medical and educational programs in Latin
America, Asia, Africa, Europe and the Caribbean.  All collected cell phones
will be recycled back into use or disposed of in an environmentally
responsible manner and you will receive an acknowledgement letter from CARE
for this donation.

The Manvel Lions Club is hosting its 5th annual Crawfish Cook Off benefiting
the Manvel Public Library.   The school library in Manvel was closed several
months ago due to &environmentally unsafe8 conditions.  A temporary library
(with rights to operate for 1 year) was opened on March 24, 2001 to provide
this public service until a new permanent location can be established.

Date:  Saturday, April 28, 2001
Time:  12:00 to 5:00 p.m.
Place:  Sacred Heart Church
6502 County Rd 48 (off Highway 6)
Manvel, Texas
Activities: In addition to the Crawfish Cook Off, there will be a Raffle,
Auction,
Music, Games, Food and much, much more.

Raffle Items: Huskee 16.5 428 Cut Lawn Mower
  Poulan 208 Gas Chain Saw
  Huskee 4HP 228 Cut Big Wheel Push Mower
  Ryobi Gas Grass Trimmer
  Electric Leaf Blower

Raffle Tickets available for: 1 for $2.00
    3 for $5.00

Come join us for a day of music, games, food and a lot of fun that helps
benefit the kids of the community.  Donations are also needed for the
auction.  For raffle tickets, donation items or more information, please
contact Susan Lopez at 713-853-7947 or 281-331-8207.

WalkAmerica, taking place April 29, is the March of Dimes biggest
fund-raiser. Money raised from the WalkAmerica supports pioneering research
and innovative programs that save babies born prematurely or with birth
defects. Since its beginning in 1970, WalkAmerica has raised more than $1
billion to help give babies a fighting chance.

Every dollar raised will be matched by Enron.

You can read more about the March of Dimes at www.modimes.org.

For more information, please contact Kimberly Nelson (ext. 33580) or Gina
Taylor (ext. 37681).

Support TEAM ENRON and Jeff Skilling by participating in the MS150 from
Houston to Austin on April 21st and April 22nd.  All-purpose volunteers are
needed to handle various logistical duties including serving meals to the
Team, playing music, directing riders to the Enron Tent, setting-up and
tearing-down, making massage appointments... to name just a few!
Can't commit to the whole weekend?  Participate where you can!  Main sites
include Bellville (Saturday lunch), LaGrange (overnight stop), Bastrop
(Sunday lunch) and Austin (the FINISH LINE!).  While everyone will be
responsible for their own transportation & lodging, our volunteers are
welcome to camp out with the Team in the Enron Tent in LaGrange.  You may
also investigate the possibility of staying at lodging establishments in the
area.
All volunteers will receive a free Enron Cycling Club tee-shirt, free meals
and a priceless experience.  Feel free to bring along your friends and family
to volunteer, too!  Take this opportunity to be a hero for our riders who
take on this cycling adventure to benefit the National Multiple Sclerosis
Society supporting the Houston, Dallas, San Antonio, Austin, and Corpus
Christi areas.  Please contact Heather Choate via e-mail or at x33278 for
more information!

VOLUNTEERS NEEDED FOR 15TH  ANNUAL HOUSTON HOOP-IT-UP MAY 5-6!

The best way to get yourself jump-started for a full year of Hoops.  Become a
part of this jammin,hoops scene with over 1,200 teams & 4,800 players.  Join
us at Greenspoint Mall for a basketball-crazed atmosphere.  Games and special
events being played simultaneously on 110 courts so the basketballs will be
flying HOOP-IT-UP is where you play for FUN.  EVENT BENEFITS THE &ESCAPE
FAMILY RESOURCE CENTER8

SATURDAY )  MAY 5TH 8:00 ) 6:00 PM
SUNDAY )  MAY 6TH 8:00 ) 5:00 PM

For more information please call &Hoop-It-Up Hotline8: 713-521-4535 or
E-Mail: Hoopitup@Texas.Net

Join the Integrated Solutions Team & PSI Homesavers on April 21 & April 28!
Enron is proud to support PSI Homesavers with three crews for their annual
spring volunteer project.  More crews can be added so sign up to participate
or include your team!  Responsibilities include being part of a work crew to
complete needed exterior home repairs for low income, predominately elderly
homeowners in Houston neighborhoods.  Contact Donnis Traylor at. ext. 55667
for more information!

M.D. Anderson will be at Enron April 23-25 and April 27 to administer
mammograms.  Call 713-745-4000 to schedule an appointment.  Cost is $25 for
employees, spouses, retirees and EDS; $85 for contractors.  Please consider
donating an extra $1 to The Rose (an organization that provides free
mammograms to low-income women).

Double click on the icon below to learn more about the new Enron Kids'
Center.

http://home.enron.com:84/messaging/e_kids_announce01.pdf

Have News to Share?
To post news or events in Enron In Action, please e-mail your information to
EIA@enron.com
no later than 12:00 noon the Thursday prior to the next Monday,s mailing.


Hi Green Roomers!

Great season.  I thought you might like to know that we did in fact finish
at the  top of our league. This season was the first time in 7 years we won
our league.  Some have inquired about a playoff game between the 1st and 2nd
placed teams.  So far I have not found that to be true, but will let you
know ASAP if I hear differently.  Here is a link to the GPSD league and
standings.

http://www.gpsdsoccer.com/

As we discussed at our last game and even though I wanted to leave the
managing to some one else.  Given our success and the fun we are having I am
willing to manage the Greenroom one more season this Fall Season in second
division.

To enter a team we will need to come up with $670 by July 23rd.  So if you
want to keep playing on the team please send me (Jon Gail) a check in the
amount of $50.00 at the address below.  If I collect extra money it will be
used to buy a few new uniforms.

Again great season and thanks to all for making it a positive experience.

Jon Gail
8573 SW Dakota Drive
Tualatin OR 97062

Ph: 503-691-8067