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----- Forwarded by Jeff Dasovich/NA/Enron on 01/11/2001 07:56 PM -----
=09Scott Govenar <sgovenar@govadv.com< =0901/11/2001 05:19 PM =09=09=20 =09=09 To: Hedy Govenar <hgovenar@govadv.com<, Mike Day <MDay@GMSSR.com<, B= ev=20 Hansen <bhansen@lhom.com<, Jeff Dasovich <jdasovic@enron.com<, Susan J Mara= =20 <smara@enron.com<, Joseph Alamo <JAlamo@enron.com<, Paul Kaufman=20 <paul.kaufman@enron.com<, David Parquet <David.Parquet@enron.com<, Marcie= =20 Milner <mmilner@enron.com<, Tim Belden <Tim.Belden@enron.com<, Rick Shapiro= =20 <rshapiro@enron.com<, Jim Steffes <james.d.steffes@enron.com<, Alan Comnes= =20 <acomnes@enron.com<, Chris Calger <ccalger@enron.com<, Mary Hain=20 <mary.hain@enron.com< =09=09 cc:=20 =09=09 Subject: Extraordinary Session - Update MEMORANDUM RE FIRST EXTRAORDINARY COMMITTEE SESSION From: Sandi McCubbin Mike Day January 11, 2001 Note: This memo will supplement the committee analysis which you will receive by separate fax. ABX1-5 Keeley re the governance of the ISO and PX was discussed first. A number of possible amendments were discussed by members. Suggested amendments included extending the term of members beyond one year, increasing the number of members beyond 3, whether there should be senate confirmation of ISO and PX board members, or at least voting representation for the legislature on the Energy Oversight Board which will approve the ISO/PX members. There was also discussion of whether FERC would approve of this new governance structure. Another discussion centered on whether the positions should be full time, as opposed to part time, and how to define =01&affiliated=018 in conjunction w= ith the bill=01,s ban on members of the ISO and PX being affiliated with a market participant. Support for the bill: Consumers Union, EOB on behalf of the administration, CalPIRG, PX, TURN, UCAN, ORA, Coalition of Utility Employees. Opposition: ISO, which raised issues regarding incompatibility with FERC orders and concern that the bill would lead to lengthy litigation. They suggested that if the ISO and PX boards were appointed solely by the California governor that FERC would not find that legally sufficient to be =01&independent=018. ABX1-6 Dutra/Pescetti addressed retained utility generation assets and commission regulation of same. The bill as written is merely a clean up to clarify that the CPUC would retain jurisdiction over utility generation after it is valued for purposes of calculating CTC=01*until and unless the CPUC gives permission for the plant to be sold under Section 851. The discussion evolved into a lengthy inquiry over the different regulatory schemes for utility and non-utility generation. Assemblyman Leonard questioned whether it was efficient to have a market where a portion of the generation was regulated and another portion unregulated. More and more members skirted the subject of attempting to regulate the non-utility generators within the state. In supporting testimony, CPUC President Lynch essentially asked for jurisdiction over such generators, stating that CPUC inspectors were denied access to an AES plant at Redondo Beach for 9 hours during an ISO alert yesterday. Chmn. Wright asked Lynch to assemble a list of the regulatory powers she would seek. In support: CPUC, TURN, UCAN, CUE, PG&E, SCE PG&E agreed with Lynch and also argued that the Legislature should revisit the exemption regulation for marketers and non-utility generators contained in Code section 216(I). PG& also had suggested technical amendments, which were not released, which dealt with confirming that Section 367 still requires market valuation and that the CPUC can set the ratemaking for such retained assets. We have talked with the author about meeting with him after the amendments are available. No amendments were voted on for any of these bills until they are brought up in the Senate. Thus there was only limited discussion of amendments.
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